Sun Caiming & Yang Hai v Dongfang Oceans and Fisheries Bureau in respect of administrative compensation

Last update time:2019-10-22 05:06:42

Sun Caiming & Yang Hai v Dongfang Oceans and Fisheries Bureau in respect of administrative compensation

[Basic facts]

On 8 June 2011, Dongfang Fisheries Law Enforcement Brigade (affiliated to Dongfang Oceans and Fisheries Bureau, currently known as Dongfang Oceans and Fisheries Monitoring Brigade) at request granted Sun Caiming the permission to set up floating rafts (250m2) in the areas of (the northwest breakwater of) Basuo Port, to be effective from 8 June 2011 to 8 June 2026. Dongfang Oceans and Fisheries Monitoring Brigade charged Sun Caiming and Yang Hai in the sum of RMB2,000 for the administration of the floating rafts. Sun Caiming and Yang Hai did not obtain a certificate of right to use sea areas or an aquaculture permit before setting up the floating rafts.

From 18 January 2018, Dongfang Oceans and Fisheries Bureau started to send notices to Sun Caiming and Yang Hai, including the “Notice of Compulsory Removal of Illegal Floating Rafts at Sea”, “Notice of Deadline for Removal of Illegal Floating Rafts in the Basin of Basuo Central Fishing Port”, and “Notice of Compulsory Removal of Illegal Marine Constructions”. On 29 May, Dongfang Oceans and Fisheries Bureau towed away the floating rafts of Sun Caiming and Yang Hai by coercive measures. As shown in the photos taken at the scene, the towed away floating rafts consisted of ten rafts (including living accommodations), measuring 4m * 4m each and totaling 160m2. Sun Caiming and Yang Hai considered that the tow-away enforced by Dongfang Oceans and Fisheries Bureau caused huge financial losses to them. Therefore, they brought an action to request Dongfang Oceans and Fisheries Bureau to pay RMB1,848,600 as compensation for the loss of the floating rafts and costs on the purchase and farming of fry.

[Judgments]

This Court held that Dongfang Oceans and Fisheries Bureau violated the administrative procedures by enforcing the tow-away without protecting the procedural rights of Sun Caiming and Yang Hai (it had been adjudged in a separate case that the compulsory tow-away was illegal). Consequently, the injured parties, i.e. Sun Caiming and Yang Hai, had the right to claim for compensations. However, they did not provide evidence for the alleged loss for costs on fry purchase and farming and did not obtain a certificate of right to use sea areas or an aquaculture permit before setting up floating rafts. Further taking into account the market prices for constructing floating rafts and the rate of depreciation thereof, this Court ordered Dongfang Oceans and Fisheries Bureau to pay Sun Caiming and Yang Hai the sum of RMB70,000 as compensation for the loss of the floating rafts. The other claims were rejected. Dongfang Oceans and Fisheries Bureau was unsatisfied with the judgment and proceeded to file an appeal. The Higher People’s Court of Hainan Province affirmed the original judgment in the second instance.

[Significance]

This case has provided a reasonable interpretation on the range of “legitimate interests” for the purpose of state compensation. In accordance with Article 2 of the Law of the People's Republic of China on State Compensation, if the exercise of duty by the administrative authorities or the staff thereof infringes upon the legitimate interests of a citizen, legal person or any other organization and causes damage, the injured party has the right to claim for compensations. Generally, if a concerned person is engaged in aquaculture without obtaining a certificate of right to use sea areas or an aquaculture permit, the proceeds obtained from the aquaculture operations shall not be deemed the legitimate interests of the person. In the subject case, while the law enforcement brigade affiliated to the fisheries authorities had no power to authorize the use of sea areas or issue an aquaculture license but granted the Permission to Set up Floating Rafts to the concerned person. The concerned person, with trust in the fisheries authorities, believed that the administrative licensing was a valid and effective permit and had been engaged in the business for a long time. The concerned person’s ownership of the floating rafts and fry shall be deemed part of its legitimate interests, and the losses arising from the demolition and dislocation of the floating rafts shall get compensations. 

However, if the concerned person is at fault for the loss, the administrative authorities shall assume less liability accordingly. In this case, the concerned person was also at fault by setting up the floating rafts without obtaining a certificate of right to use sea areas or an aquaculture permit and also failing to take effective measures to avoid the loss of fry during the period when they received notices from the administrative authorities. The administrative authorities therefore shall assume less liability for compensation.