Construction Of Model Action System In China

Frequent occurrence of securities fraud on the securities market leads to the increase of civil actions.Severe information asymmetry exists between small-sized investors and listed companies.According to the substantive law,it's quite difficult for small-sized investors to gather evidence for securities misrepresents of listed companies,due to the principle of burden of proof.Especially,the first plaintiff who files a lawsuit to listed companies is in a state of cost-benefit imbalance.In view of this,our country launched a special judicial interpretation to reduce the burden of proof for the investors.In terms of procedural law,China has adopted the system of representative action for securities misrepresents in civil litigation,which ended in failure.Representative action for dealing with group disputes has been proved to be ineffective.Securities Law would take a brand-new representative action mode into consideration-the investor protection institutions taking the role as representatives,the representative action mode would take the "opt-out" as its core.However,the rules are too general,so the author makes a reasonable guess based on the principled provisions and analyzes its disadvantages,arguing that it has not improved much compared to the traditional representative action.At the same time,according to the Securities Law,model action has not been banned.Without adopting the new representative action mode,the court can still adopt the model action to carry out the trial of the cases.On this basis,civil disputes over securities misrepresents are consistent in tort act,but differ in causality and losses,since it's a kind of group tort cases.Some of the "elements" of these cases can be extracted and tried separately and the judgment could be applied to similar cases,as model action rises.Germany's Kap Mu G law,as the most representative act of the model action in the field of securities litigation has been the pattern of similar trial document in China,which was revealed by Shanghai financial court.The author starts with the concept of model action and points out the differences between it and representative action,the most important of which is whether it breaks the concept of "opposite parties" in traditional litigation.Based on the unique features of the field of securities misrepresentation in civil disputes,an empirical analysis is conducted to point out the necessity and feasibility of the application of model litigation in this field.The author considers that to carry on the reformation,we need to solve these problems:(1)The model case-the current theory views more stresses on the commonality of facts and legal application,but the author considers that only the commonality is not enough to reflect the meaning of "model",but the "comprehensivity" needs to be accepted,which means model case should include as many facts and legal issues as possible arising from the trial.In addition,the model case should have other considerations besides the characteristics of the case,the purpose of which is to promote the smooth trial of the case.The author also gives his own unique solution for how to select a case for a single defendant----the "progressive" trial mode is adopted for cases composed of different defendants.(2)Protection of the procedural rights for the plaintiffs of similar cases-There exists provision on the protection of litigants in Kap Mu G.In the documents of the Shanghai Financial Court,the litigation participation of the parties in similar cases has not been mentioned.The author thinks that the legitimacy of the expansion of subjective scope of res judicata is part from program litigation participation,but it conflicts the "adjudication" and "unification" of the model action.For this sake,the author is in favor of allow the plaintiffs of the similar cases file their opinions within a specific time,which would be explained and cross-examined selectively.At the same time,the legitimacy of the expansion of the subjective scope of judgment is partly derived from procedural guarantees for parties who have not participated in the litigation.(3)The expansion of subjective scope of res judicata-The author is in favor of similar cases can be heard and judged according to the facts and legal issues which have been heard in the previous case.In addition,due to the existence of the "pre-determination effect" theory and the special provisions on "court ruling documents" as evidence in the Interpretation of the Civil Procedure Law of China,the unity of judgment results can also be achieved from the view of "pre-determination effect".