Guiding Case No. 3

Full Text of the Guiding Case

Keyword(s)

Main Points of the Adjudication

1. A state functionary who exploits the advantages of office to seek benefits for an entrusting person and, together with the entrusting person, obtains “profits” in the name of “jointly organizing” a company but does not actually contribute capital or participate in the operation and management shall be punished for accepting bribes.

2. A state functionary who knows that a person has an entrusted matter and yet accepts his property shall be regarded as having promised to “seek benefits for others.” The determination of “accepting bribes” is not affected by whether benefits were actually sought for the other person or whether benefits were actually obtained.

3. A state functionary who exploits the advantages of office to seek benefits for an entrusting person and purchases goods like houses from the entrusting person at obviously below-market prices shall be punished for accepting bribes. [1] The amount of bribes accepted is calculated in accordance with the difference between the local market price at the time of the transaction and the price actually paid.

4. The determination of the crime of accepting bribes is not affected by the fact that after a state functionary has accepted property, she, due to the investigation of individuals and matters connected to her acceptance of bribes, returns it to conceal the crime.

Article 385, Paragraph 1 of the Criminal Law of the People’s Republic of China

Basic Facts of the Case

Between August and September of 2003, the defendants, PAN Yumei (潘玉梅) and CHEN Ning (陈宁), respectively exploited the advantages of their office as Secretary of the Street Working Committee of Maigao Bridge, Qixia District, Nanjing Municipality, Jiangsu Province and Director of the Office of Maigao Bridge to help a certain CHEN, General Manager of a real estate development limited company in Nanjing, among other things, obtain 100 mu of land in Maigao Bridge’s Innovation Park District at low prices. [2] Furthermore, on September 3, the defendants respectively used the names of their relatives to jointly register and form Nanjing Duohe Industry and Trade Co., Ltd. (hereinafter referred to as “Duohe Company”) with CHEN in order to “develop” the above-mentioned land. PAN Yumei and CHEN Ning neither actually contributed capital nor participated in the operation and management of this company.

In June 2004, CHEN, in the name of Duohe Company, transferred the company and its land to a sporting goods limited company in Nanjing. PAN Yumei and CHEN Ning, in the name of participating in profit-sharing, respectively accepted RMB 4.8 million offered by CHEN. In March 2007, because PAN Yumei was being investigated, CHEN Ning, while on a business trip to the United States, arranged for his driver to return RMB 800,000 to CHEN. After this case was exposed, the illicit money and gains generated from such money obtained by PAN Yumei and CHEN Ning were all recovered in accordance with law.

From February to October of 2004, the defendants, PAN Yumei and CHEN Ning, respectively exploited the advantages of their office as Secretary of the Street Working Committee of Maigao Bridge and Director of the Office of Maigao Bridge to help a property placement and development limited company in Nanjing purchase land in Maigao Bridge’s Innovation Park. At four different times, each of them accepted RMB 500,000 offered by a certain WU, General Manager of the company.

In the first half of 2004, defendant PAN Yumei exploited the advantages of office as Secretary of the Street Working Committee of Maigao Bridge to help a development limited company in Nanjing have a fee waiver of RMB 1 million on the project of transferring Jin Qiao Building. When purchasing the real estate developed by the company, PAN Yumei accepted over RMB 610,000, an amount paid on behalf of her by a certain XU, General Manager of that company, to cover the difference between the house price and the amount she paid and related taxes (the price of the house including taxes was RMB 1,210,817; PAN paid RMB 600,000). In April 2006, because procuratorial organs had already grasped from XU’s company accounts the situation that she had merely made partial payment for the purchase of the house, PAN Yumei reimbursed XU RMB 550,000.

Furthermore, from the time prior to the 2000 Chinese New Year to December 2006, defendant PAN Yumei exploited the advantages of office to accept first RMB 2.01 million and USD 490,000 from a certain GAO, Secretary of a Party Branch in the Maigao Bridge Office and General Manager of a certain commerce and trade limited company in Nanjing, and then USD 10,000 from a certain FAN of a Nanjing property placement limited company of a real estate group in Zhejiang. Between 2002 and 2005, defendant CHEN Ning exploited the advantages of office to accept first RMB 210,000 from GAO, Secretary of a Party Branch in the Maigao Bridge Office, and then RMB 80,000 from a certain LIU, Deputy Director of the Maigao Bridge Office.

In summary, defendant PAN Yumei accepted bribes of over RMB 7.92 million and USD 500,000 (equivalent to RMB 3,981,234), totaling RMB 11.902 million; defendant CHEN Ning accepted bribes of RMB 5.59 million.

Results of the Adjudication

On February 25, 2009, the Intermediate People’s Court of Nanjing Municipality, Jiangsu Province, by the (2008) Ning Xing Chu Zi No. 49 Criminal Judgment, determined that defendant PAN Yumei was guilty of the crime of accepting bribes and was sentenced to death with a two-year suspension of execution, deprived of political rights for life, and confiscated of all of her property; defendant CHEN Ning was guilty of accepting bribes and was sentenced to life imprisonment, deprived of political rights for life, and confiscated of all of his property. After the judgment was pronounced, PAN Yumei and CHEN Ning appealed. On November 30, 2009, the Higher People’s Court of Jiangsu Province, based on the same facts and reasons, rendered the (2009) Su Xing Er Zhong Zi No. 0028 Criminal Ruling. It rejected the appeal, upheld the original judgment, and examined and approved the first-instance criminal judgment, in which, based on the crime of accepting bribes, defendant PAN Yumei was sentenced to death with a two-year suspension of execution, deprived of political rights for life, and confiscated of all of her property.

Reasons for the Adjudication

In the effective ruling and/or judgment, the court(s) opined:

With respect to the defense views put forward by the defendants, PAN Yumei and CHEN Ning, as well as their defenders [3] that the defendants’ acts of jointly organizing Duohe Company with CHEN and reaping a “profit” of RMB 4.8 million through the development of land should not be determined to be accepting bribes: According to investigation, at the time, PAN Yumei was Secretary of the Street Working Committee of Maigao Bridge while CHEN Ning was Director of the Maigao Bridge Street Office, and they were responsible for leading or coordinating business invitations and land transfers in Maigao Bridge Innovation Park District. The two persons respectively exploited the advantages of their office to help CHEN obtain land etc. in Innovation Park District at low prices and this was [a type of] exploitation of the advantages of office to seek benefits for others. During this period, PAN Yumei, CHEN Ning, and CHEN held discussions to jointly organize Duohe Company for developing the above-mentioned land. All of the registered capital of the company came from CHEN; PAN Yumei and CHEN Ning neither actually contributed capital nor participated in the operation and management of the company. Therefore, PAN Yumei and CHEN Ning respectively exploited the advantages of their office to seek benefits for CHEN, and the RMB 4.8 million that each gained in the name of jointly organizing a company with CHEN to develop that piece of land were not so-called corporate profits, but were a portion of benefits generated from the resale of the land obtained for CHEN at a low price by exploiting the advantages of their office. This exemplified the power-in-exchange-for-money nature of the crime of accepting bribes and belonged to a disguised form of accepting bribes occurring in the name of jointly organizing a company, and [the defendants] should be punished for accepting bribes.

With respect to the defense views put forward by defendant PAN Yumei and her defender that PAN Yumei had not actually sought benefits for XU: According to investigation, when the entrusting person XU bribed PAN Yumei and requested a fee waiver of RMB 1 million in the project of transferring Jin Qiao Building, PAN Yumei accepted the bribes, knowing that XU had an entrusted matter. Although the entrusted matter was not realized, “seeking benefits for others” includes acts of different stages, such as promise, implementation and realization, and the existence of any of these acts [made the situation] properly categorized as seeking benefits for others. The promise to “seek benefits for others” could be determined from an explicit or implicit expression of intent to seek benefits for others. PAN Yumei, who knew that another person had an entrusted matter and yet accepted his property, should be regarded as having promised to seek benefits for that person. The determination of “accepting bribes” was not affected by whether benefits were already actually sought for the other person or whether benefits were actually obtained because these were only issues concerning the circumstances of the bribe acceptance.

With respect to the defense views put forward by defendant PAN Yumei and her defender that PAN Yumei’s purchase of XU’s real estate should not be determined to be accepting bribes: According to investigation, the market price, together with taxes, of the real estate purchased by PAN Yumei should exceed RMB 1.21 million, but PAN Yumei only paid RMB 600,000, which was obviously below the local market price of that real estate at the time of the transaction. PAN Yumei’s acts of exploiting the advantages of office to seek benefits for the entrusting person and purchasing real estate at obviously below-market prices from the entrusting person was a way of concealing the power-in-exchange-for-money nature of her accepting of bribes by formally paying a certain amount of the price, and she should be punished for accepting bribes. The amount of bribes accepted was calculated in accordance with the difference between the local market price at the time of the real estate transaction in question and the price actually paid.

With respect to the defense views put forward by PAN Yumei and her defender that, in her purchase of the real estate developed by XU, PAN Yumei had already paid XU the price difference on the real estate before the case was exposed and hence should not be determined to have accepted bribes: According to investigation, in April 2006, and before the case was exposed, PAN Yumei had reimbursed XU for RMB 550,000 of the price difference in the purchase of the real estate developed by XU. It had been nearly two years since she purchased the house at a low price in the first half of 2004, and thus she had not promptly reimbursed the huge price difference. PAN Yumei’s reimbursement acts were acts of returning illicit money undertaken for the purpose of concealing the crime because XU was found by procuratorial organs to have discussions about other cases, and procuratorial organs had already grasped from XU’s company accounts the situation that PAN Yumei merely made partial payment for the purchase of the house. Therefore, PAN Yumei’s reimbursement of the price difference on the house in order to conceal the crime did not affect the determination of her being guilty of the crime of accepting bribes.

In summary, the aforementioned defense views put forward by defendants, PAN Yumei, CHEN Ning, and their defenders could not stand and were not adopted. PAN Yumei and CHEN Ning, as state functionaries, respectively exploited the advantages of their office to seek benefits for others and accepted others’ property; these acts already constituted the crime of accepting bribes. Furthermore, the amounts of the bribes accepted were especially enormous. But, at the same time, in view of the mitigating circumstances that the two defendants possessed – including that they both gave truthful account of their crimes and confessed their crimes with good attitudes after being apprehended, that they took the initiative to account remaining crimes of the same type that judicial organs had not grasped, that they returned part of the illicit money before the case was exposed, and that they cooperated in the recovery of all of the illicit money in question after the case was exposed – the courts of first and second instances rendered the above ruling and judgment in accordance with law.

Endnotes

*           The citation of this translation of the Guiding Case is: 《潘玉梅、陈宁受贿案》(PAN Yumei and CHEN Ning, A Bribe-Accepting Case), China Guiding Cases Project, English Guiding Case (EGC3), Jan. 9, 2012 Edition, available at https://cgc.law.stanford.edu/guiding-cases/guiding-case-3.

This document was primarily prepared by Christine Qingyu Liu and Randy Wu. The document was finalized by Jennifer Ingram and Dr. Mei Gechlik. Minor editing, such as splitting long paragraphs, adding a few words included in square brackets, and boldfacing the headings to correspond with those boldfaced in the original Chinese version, was done to make the piece more comprehensible to readers. The following text, otherwise, is a direct translation of the original text and reflects formatting of the Chinese document released by the Supreme People’s Court.

The following Guiding Case was discussed and passed by the Adjudication Committee of the Supreme People’s Court of the People’s Republic of China and was released on December 20, 2011, available at http://old.chinacourt.org/public/detail.php?id=472160. See also 《最高人民法院关于发布第一批指导性案例的通知》 (The Supreme People’s Court’s Notice Concerning the Release of the First Batch of Guiding Cases), Dec. 20, 2011, available at http://old.chinacourt.org/html/article/201112/21/472164.shtml.

[1]           Translators’ note: The original Chinese expression is “房屋等物品” (goods like houses), which, unfortunately, suggests that houses are goods. The Supreme People’s Court probably meant to use “财物”(property), instead of “物品” (goods), to group “houses”, a type of real property, under “property”.

[2]           Translators’ note: 1 mu = 0.165 acre.

[3]           Translators’ note: In China, a defender (“辩护人”) is not necessarily an attorney. For more information, see Article 32 of the Criminal Procedure Law of the People’s Republic of China, adopted on July 1, 1979 and amended on Mar. 17, 1996.