Local governments lose an astonishing 30-50% of law suits in China, according a magazine article described in SCMP (SCMP 4/23, "Governments on wrong side of law"). The article suggests that this shows that local government are acting contrary to the law. These law suits are being brought under the China's 1989 Administrative Procedure law. Of these administrative law suits, 30-40% consist of cases concerning land seizures, housing relocations, social security and state-owned-enterprise reform (in essence, folks getting laid off from their state company jobs).
The assertion that local governments oftentimes act contrary to the law and are sued as a result seems pretty unremarkable. However, I am astonished that the plaintiffs appear to win so often. From all the things I have heard, the plaintiffs most of the time come out on the losing end. My sense was that judges would not ordinarily rule against local government officials in such matters. Even if judges in large metropolitan areas like Beijing and Shanghai may be more professional, and so such a high loss rate seems likely in such regions, that is less the case in the rural areas and away from the coast.