Judicial Application Of Punitive Damages In The Consumer Protection Law

Punitive damages which originated from the legal system of Britain and the United States, are made by courts and a class of money awarded in cases beyond what is needed to compensate the plaintiff for his injuries. It serves multiple purposes, including compensation for loses, punishing and preventing illegal acts. In China, punitive damage is first specified in Article 49 of the Consumer Protection Law. The provision of punitive damages in the revised Law of the People's Republic of China on the Protection of Consumer Rights and Interests, enacted in March 15th,2014, has changed from original terms of the "retreat one lose one" to "retreat one lose three". Besides, business operators shall pay punitive damages up to twice the amount of the losses due to defective products. However, in the two decades of implementation of the law, heated discussions have been continuously going on in judicial application. For example, the definition of cheating, the amount of damages, moral crisis and etc.Thus, punitive damages in the Consumer Protection Law should apply to China's national conditions. The system of punitive damages should protect the legitimate interests and rights of consumers, as well as taking the development of economy and business operators'endurance capacity into consideration. First, consumptive fraud is different from general fraud in civil cases or contract fraud. Objectively, consumptive fraud contains intention and serious negligence. Subjectively, consumptive fraud consists of acts and omissions. Second, it is suggested "three times compensation" should be changed into "within three times compensation". The amount of damages should be decided by judges in individual cases, considering the degree of fault, consequences and administrative penalty. Third, according to the principle the punishment fitting the crime, punitive damages and administrative responsibility should complement each other. Four, judicial apparatus should cooperate with government administrative departments. Occupational plaintiffs who sue for benefits are not helpful to build a good consuming environment. Government administration plays an important role in supervising market order. When a cheating judgment is made, administration should urge illegal business operators fix their faults.