45 Types! Circumstances in which the guarantor does not bear responsibility under the Civil Code
Time:
2021-02-24
Author:
Source:
Law Lecture Hall - Understanding the Civil Code
Visits:
24
Since January 1, 2021, the official implementation of the "Civil Code" and the "Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China" has ushered in a new era in which Chinese laws protect the legitimate rights and interests of guarantors! The guarantee legal system before the "Civil Code" focused on how to protect the interests of creditors. Starting from the "Civil Code", the protection of the legitimate rights and interests of debtors and guarantors will also be greatly strengthened.
1. If the creditor and the guarantor do not agree on the guarantee liability in writing, the guarantor shall not be liable.
Article 685 of the "Civil Code" stipulates: The guarantee contract may be a separate written contract or a guarantee clause in the main creditor's rights and debts contract. If a third party makes a guarantee to the creditor in writing unilaterally, and the creditor accepts it without objection, the guarantee contract is established.
Article 490 of the "Civil Code" stipulates: If laws or administrative regulations stipulate or the parties agree that the contract shall be concluded in writing, if the parties do not adopt the written form, but one party has performed the main obligations and the other party accepts it, the contract is established.
The judgment of (2016) Su 0382 Minchu No. 1736 holds that: Li Zhankun only provided a verbal guarantee for Yuan Yicheng's loan to Zhang Yuejun, and did not sign a written contract. The plaintiff Zhang Yuejun also has no evidence to prove that Li Zhankun has performed the main guarantee obligation, so the guarantee contract is not established, and Li Zhankun should not bear the guarantee responsibility.
2. If the creditor fails to file a lawsuit or arbitration against the guarantor or claim rights during the guarantee period, the guarantor shall not be liable.
Article 693 of the "Civil Code" stipulates: If the creditor of a general guarantee fails to file a lawsuit or apply for arbitration against the debtor within the guarantee period, the guarantor shall no longer be liable for the guarantee. If the creditor of a joint and several liability guarantee fails to request the guarantor to assume the guarantee liability within the guarantee period, the guarantor shall no longer be liable for the guarantee.
The "Civil Code" stipulates: If there is no agreement or the agreement is unclear, the guarantee period shall be 6 months after the expiration of the main performance period.
3. The guarantor's right of defense of prior prosecution has the right to refuse to assume the guarantee liability.
Article 687 of the "Civil Code" stipulates: If the parties agree in the guarantee contract that the guarantor shall bear the guarantee liability when the debtor cannot perform the debt, it is a general guarantee. The guarantor of a general guarantee has the right to refuse to assume the guarantee liability to the creditor before the main contract dispute has been tried or arbitrated, and the debtor's property has been forcibly executed according to law but still cannot perform the debt.
The prerequisite conditions for the guarantor's right of defense of prior prosecution are the same under the old and new laws, both requiring the main contract to be tried or arbitrated, and the debtor's property to be forcibly executed. The change lies in the exceptional circumstances.
4. After the debtor's bankruptcy begins, if the guarantor's guarantee period has expired, the creditor has no right to demand that the guarantor bear the liability even 6 months after the end of the bankruptcy proceedings.
Article 44 of the "Interpretation of the Guarantee Law" stipulates that the guarantor shall still be liable for the part of the creditor's rights that has not been paid in the bankruptcy proceedings after the creditor declares the creditor's rights. If the creditor requires the guarantor to bear the guarantee liability, it shall be filed within six months after the end of the bankruptcy proceedings. It seems that the guarantee period is no longer a consideration factor for the guarantee liability in the event of the debtor's bankruptcy. Combined with the Reply of the Supreme People's Court on How to Apply Article 44 of the Interpretation on Several Issues Concerning the Application of the Guarantee Law of the People's Republic of China to the Yunnan Provincial Higher People's Court, "Article 44 only applies to the guarantee period has not expired when the debtor's bankruptcy proceedings begin, and the guarantee period expires during the creditor's declaration of creditor's rights to participate in the liquidation of bankruptcy property", it can be seen that the debtor's bankruptcy does not exclude the application within the guarantee period, that is, only when the debtor is bankrupt before the guarantee period has expired, and the creditor has not claimed the guarantee liability from the guarantor, the creditor can still claim from the guarantor within six months after the end of the bankruptcy proceedings. However, if the guarantee period has been exceeded when the debtor is bankrupt, there is no room for the application of the aforementioned provisions.
Article 687 of the "Civil Code" stipulates that When the debtor is bankrupt, the guarantor of a general guarantee does not have the right of defense of prior prosecution, and the creditor can directly claim the guarantee liability from it.
5. If the creditor transfers all or part of the creditor's rights without notifying the guarantor, the transfer shall not be effective against the guarantor.
Article 696 of the "Civil Code" stipulates: If the creditor transfers all or part of the creditor's rights without notifying the guarantor, the transfer shall not be effective against the guarantor.
If the creditor transfers part of the creditor's rights without notifying the guarantor, the guarantor shall bear the guarantee liability for the part of the creditor's rights that has not been transferred by the creditor. That is, the creditor shall claim rights or file a lawsuit or arbitration against the guarantor within the guarantee period. If the creditor does not claim rights, the guarantor shall not be liable for the guarantee.
If the creditor transfers all the creditor's rights without notifying the guarantor, and the transferee of the creditor's rights, rather than the creditor, claims rights or files a lawsuit or arbitration against the guarantor during the guarantee period, the guarantor shall not bear any guarantee liability.
6. If the guarantor and the creditor agree to prohibit the transfer of creditor's rights, and the creditor transfers the creditor's rights without the guarantor's written consent, the guarantor shall no longer be liable to the transferee.
Article 696 of the "Civil Code" stipulates: If the guarantor and the creditor agree to prohibit the transfer of creditor's rights, and the creditor transfers the creditor's rights without the guarantor's written consent, the guarantor shall no longer be liable to the transferee.
If the guarantor agrees in writing to prohibit the transfer of creditor's rights, and the creditor transfers the creditor's rights to the outside world without the guarantor's written consent, even if the creditor notifies the guarantor, the guarantor shall absolutely not bear any guarantee liability to the transferee. Even if the transferee claims rights or files a lawsuit or arbitration against the guarantor during the guarantee period, the guarantor shall not bear any guarantee liability to the original creditor and the transferee of the creditor's rights.
7. After the guarantee period has passed, the guarantor's mere signing of the "Demand Letter" served by the creditor to the debtor does not constitute a new guarantee.
《The Supreme People's Court's Reply on How People's Courts Should Determine the Issue of Guarantors Signing Collection Notices After the Expiration of the Guarantee Period》To the Higher People's Courts of Yunnan, Hebei, and Sichuan Provinces: Your requests Yun Gao Fa [2003] No. 69 《Request for Instructions on How to Determine the Nature and Responsibility of a Guarantor Signing a催款通知书 (Collection Notice) After the Guarantee Period Has Expired》, (2003) Ji Min Er Qing Zi No. 1 《Request for Instructions on How to Determine the Civil Liability of a Guarantor Who Has Stamped the
After research, the reply is as follows: According to the provisions of the "Guarantee Law of the People's Republic of China", if the creditor fails to claim the guarantee liability from the guarantor in accordance with the law after the expiration of the guarantee period, the guarantee liability shall be extinguished. After the guarantee liability is extinguished, if the creditor notifies the guarantor in writing to demand that it bear the guarantee liability or pay off the debt, and the guarantor signs on the payment notice, the people's court shall not determine that the guarantor continues to bear the guarantee liability. However, if the content of the payment notice meets the provisions of the Contract Law and the Guarantee Law regarding the establishment of a guarantee contract, and is approved by the guarantor's signature, and it can be determined that a new guarantee contract is established, the people's court shall determine that the guarantor bears the responsibility in accordance with the new guarantee contract.
Article 693 of the "Civil Code" stipulates: If the creditor of a general guarantee fails to file a lawsuit or apply for arbitration against the debtor during the guarantee period, the guarantor shall no longer be liable for the guarantee. If the creditor of a joint and several liability guarantee fails to request the guarantor to assume the guarantee liability during the guarantee period, the guarantor shall no longer be liable for the guarantee. After the guarantee period has passed, the guarantor shall no longer bear the guarantee liability definitively, unless the creditor and the guarantor reach a new agreement on the guarantee matters. However, after the guarantee period has passed, the guarantor's mere signing on the "Demand Letter" served by the creditor to the debtor does not constitute a guarantee invitation by the creditor, and the guarantor's mere signing does not constitute a commitment, so it does not constitute a new guarantee.
8. If the creditor allows the debtor to transfer all or part of the debt without the written consent of the guarantor, the guarantor shall no longer be liable for the debt transferred without its consent, unless otherwise agreed between the creditor and the guarantor.
Article 697 of the Civil Code stipulates: If the creditor allows the debtor to transfer all or part of the debt without the written consent of the guarantor, the guarantor shall no longer be liable for the debt transferred without its consent, unless otherwise agreed between the creditor and the guarantor.
The transfer of debt by the debtor to a third party requires the consent of the creditor and the guarantor. If the creditor does not agree to the debtor's transfer of debt, the debt transfer does not occur. If the creditor agrees to the debtor's transfer of debt, but the guarantor does not agree, the debt transfer is also effective, but the guarantor is no longer liable for the transferred debt.
9. If the guarantor of a general guarantee provides the creditor with the true information of the debtor's property available for execution after the expiration of the performance period of the principal debt, and the creditor abandons or is negligent in exercising its rights, resulting in the property not being executed, the guarantor shall no longer be liable for the guarantee within the value range of the executable property it provides.
Article 698 of the Civil Code stipulates: If the guarantor of a general guarantee provides the creditor with the true information of the debtor's property available for execution after the expiration of the performance period of the principal debt, and the creditor abandons or is negligent in exercising its rights, resulting in the property not being executed, the guarantor shall no longer be liable for the guarantee within the value range of the executable property it provides.
Banks, as financial institutions, often agree in loan and guarantee contracts that the guarantor shall open an account with the loan bank, and once the debtor is overdue in repaying the bank loan, the loan bank has the right to directly deduct the overdue loan principal and interest from the bank account opened by the guarantor with the loan bank. However, if the debtor or a third party provides real estate mortgage to the loan bank at the same time, and the bank abandons or is negligent in executing the real estate mortgage for the convenience of execution, the guarantor shall no longer be liable for the guarantee within the value range of the mortgaged property.
10. The guarantor may assert the debtor's statute of limitations defense against the creditor. If the debtor waives the statute of limitations defense, the guarantor still has the right to assert the statute of limitations defense against the creditor.
11. If the debtor has the right of set-off or revocation against the creditor, the guarantor may refuse to bear the guarantee liability within the corresponding scope.
12. If the creditor defrauds the guarantor or the debtor defrauds the guarantor and the creditor is aware of it, the guarantor may sue to revoke the guarantee act.
Article 148 of the Civil Code: If a party uses fraudulent means to cause the other party to perform a civil legal act against their true intentions, the defrauded party has the right to request the people's court or arbitration institution to revoke it.
Article 149: If a third party commits fraudulent acts, causing one party to perform a civil legal act against their true intentions, and the other party knows or should have known about the fraudulent acts, the defrauded party has the right to request the people's court or arbitration institution to revoke it.
In the era of the original "Guarantee Law", there were also explicit provisions for creditors defrauding guarantors or debtors defrauding guarantors, and creditors being aware of it. Article 30 of the "Guarantee Law": Under any of the following circumstances, the guarantor shall not bear civil liability:
(1) Both parties to the main contract collude to defraud the guarantor into providing a guarantee;
(2) The creditor of the main contract uses fraud, coercion, or other means to cause the guarantor to provide a guarantee against their true intentions. Article 40 of the Judicial Interpretation of the "Guarantee Law": If the debtor of the main contract uses fraud, coercion, or other means to cause the guarantor to provide a guarantee against their true intentions, and the creditor knows or should have known about the facts of fraud or coercion, it shall be handled in accordance with the provisions of Article 30 of the Guarantee Law.
In the era of the "Civil Code", it is clearly stated that when the above circumstances occur, the guarantor may revoke the guarantee act through litigation or arbitration.
14. When the mortgage provided by the debtor and the guarantee provided by the guarantor coexist, the guarantor may be exempted from liability.
Article 409 of the Civil Code: If the debtor sets a mortgage on their own property, and the mortgagee waives the mortgage right, the order of the mortgage right, or changes the mortgage right, other guarantors shall be exempted from the guarantee liability to the extent that the mortgagee loses the priority right to compensation, unless the other guarantors promise to continue to provide the guarantee.
This article has already been stipulated in Article 194 of the "Property Law": If the debtor sets a mortgage with his own property, and the mortgagee waives the mortgage right, the priority of the mortgage right, or changes the mortgage right, the other guarantors shall be exempted from the guarantee liability within the scope of the mortgagee's loss of priority of compensation, unless the other guarantors promise to continue to provide guarantee.
15. If the main contract is invalid, the guarantee contract is invalid.
Article 8 of the Judicial Interpretation of the Guarantee Law: If the main contract is invalid, resulting in the guarantee contract being invalid, and the guarantor is not at fault, the guarantor shall not bear civil liability; if the guarantor is at fault, the part of the civil liability borne by the guarantor shall not exceed one-third of the part that the debtor cannot pay.
Article 388 of the Civil Code: If the main creditor's rights and debts contract is invalid, the guarantee contract is invalid, unless otherwise provided by law. After the guarantee contract is confirmed to be invalid, if the debtor, guarantor, and creditor are at fault, they shall each bear corresponding civil liability according to their fault.
The "Civil Code" does not stipulate that the main contract is invalid, resulting in the guarantee contract being invalid in the guarantee chapter, but it is reflected in the general provisions of the security rights in rem in Part IV. The "Civil Code" also stipulates that: a guarantee contract includes a mortgage contract, a pledge contract, and other contracts with guarantee functions. Lawyers believe that guarantee, as other contracts with guarantee functions, can be applied to this clause.
16. If the guarantee contract is invalid, the guarantee period can also bind the creditor.
Article 33 of the Implementation of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If the guarantee contract is invalid and the creditor fails to exercise his rights in accordance with the law within the agreed or statutory guarantee period, and the guarantor claims that he is not liable for compensation, the people's court shall support it.
17. If a branch company provides external guarantee in its own name without a resolution of the company's shareholders' (general) meeting or board of directors, it is invalid.
Article 11 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If a branch of a company provides external guarantee in its own name without a resolution of the company's shareholders' (general) meeting or board of directors, and the counterparty requests the company or its branch to bear the guarantee liability, the people's court shall not support it, unless the counterparty does not know and should not have known that the branch's external guarantee was not subject to the company's resolution procedures.
18. If an organ legal person provides a guarantee, the people's court shall determine that the guarantee contract is invalid.
Article 5 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If an organ legal person provides a guarantee, the people's court shall determine that the guarantee contract is invalid.
19. The guarantor shall not bear the guarantee liability for debts beyond the scope of the debtor's liability.
Article 3 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If the parties agree on special liability for breach of contract for the assumption of guarantee liability, or the agreed scope of guarantee liability exceeds the scope of liability that the debtor should bear, and the guarantor claims to only bear liability within the scope of liability that the debtor should bear, the people's court shall support it.
20. If a neighborhood committee or villagers committee provides a guarantee, the people's court shall determine that the guarantee contract is invalid.
Article 5 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If a neighborhood committee or villagers committee provides a guarantee, the people's court shall determine that the guarantee contract is invalid.
21. If non-profit schools, kindergartens, medical institutions, elderly care institutions, etc. for public welfare purposes provide guarantees, the people's court shall determine that the guarantee contract is invalid.
Article 6 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If non-profit schools, kindergartens, medical institutions, elderly care institutions, etc. for public welfare purposes provide guarantees, the people's court shall determine that the guarantee contract is invalid.
22. If the legal representative of a company exceeds his authority to conclude a guarantee contract with a non-bona fide counterparty on behalf of the company, the guarantee contract shall not be effective against the company.
Article 7 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If the legal representative of a company violates the provisions of the Company Law on the company's external guarantee resolution procedures and exceeds his authority to conclude a guarantee contract with the counterparty on behalf of the company, and the counterparty is not in good faith, the guarantee contract shall not be effective against the company.
23. If two or more third parties provide guarantees for the same debt, and the guarantors have not agreed on mutual recourse and sharing ratios, and the guarantor who has assumed the guarantee liability requests other guarantors to share the part that cannot be recovered from the debtor, the people's court shall not support it.
Article 13 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If two or more third parties provide guarantees for the same debt, and the guarantors agree on mutual recourse and sharing ratios, and the guarantor who has assumed the guarantee liability requests other guarantors to share the share according to the agreement, the people's court shall support it; if the guarantors agree to bear joint and several joint guarantees, or agree on mutual recourse but do not agree on the sharing ratio, each guarantor shall share the part that cannot be recovered from the debtor in proportion.
If two or more third parties provide guarantees for the same debt, and the guarantors have not agreed on mutual recourse and have not agreed to bear joint and several joint guarantees, but each guarantor signs, seals, or fingerprints on the same contract, and the guarantor who has assumed the guarantee liability requests other guarantors to share the part that cannot be recovered from the debtor in proportion, the people's court shall support it.
Except for the circumstances stipulated in the preceding two paragraphs, if the guarantor who has assumed the guarantee liability requests other guarantors to share the part that cannot be recovered from the debtor, the people's court shall not support it.
24. If the guarantor who has acquired the creditor's rights requests other guarantors to bear the guarantee liability as the creditor, the people's court shall not support it.
Article 14 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If two or more third parties provide guarantees for the same debt, and the guarantor acquires the creditor's rights, the people's court shall recognize that this act constitutes the assumption of guarantee liability. If the guarantor who acquires the creditor's rights requests other guarantors to assume guarantee liability as a creditor, the people's court shall not support it; if the guarantor requests other guarantors to share the corresponding share, it shall be handled in accordance with the provisions of Article 13 of this Interpretation.
25. The guarantor of the old loan is not liable when the debtor replaces the old debt with a new one.
Article 16 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If the parties to the main contract agree to repay the old loan with a new loan, the people's court shall not support the creditor's request for the guarantor of the old loan to assume guarantee liability.
26. If the new loan guarantor and the old loan guarantor are different and do not know that the old debt is being replaced with a new one, the new loan guarantor is not liable.
Article 16 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If the parties to the main contract agree to repay the old loan with a new loan, the people's court shall not support the creditor's request for the guarantor of the old loan to assume guarantee liability; if the creditor requests the guarantor of the new loan to assume guarantee liability, it shall be handled in accordance with the following circumstances:
(1) If the guarantors of the new loan and the old loan are the same, the people's court shall support it;
(2) If the guarantors of the new loan and the old loan are different, or the old loan has no guarantee and the new loan has a guarantee, the people's court shall not support it, unless the creditor has evidence to prove that the guarantor of the new loan knew or should have known the fact that the old loan was repaid with the new loan when providing the guarantee.
27. If the main contract is valid but the guarantee contract provided by a third party is invalid, and the creditor is at fault but the guarantor is not at fault, the guarantor shall not be liable for compensation.
28. If the main contract is invalid, resulting in the invalidity of the guarantee contract provided by a third party, and the guarantor is not at fault, the guarantor shall not be liable for compensation.
29. After assuming the guarantee liability, the guarantor may seek recourse from the debtor, but unless there is an agreement on recourse with other guarantors, the guarantor cannot seek recourse from other guarantors for the portion that the debtor cannot repay.
30. A guarantor who assumes the liability of subrogation can only seek recourse from other guarantors after failing to recover from the debtor.
Liu Guixiang (full-time member of the Supreme People's Court Adjudication Committee at the vice-ministerial level) believes in Several Major Issues Concerning Guarantees in the Civil Code: That is, whether the guarantor needs to seek recourse from the main debtor first before seeking recourse from other guarantors? Can recourse be sought from other guarantors only when it is impossible to seek recourse from the main debtor? I believe that in order to avoid the uncertainty of seeking recourse from the debtor and other guarantors and the circular recourse, it is advisable to seek recourse from the main debtor first, and then seek recourse from other guarantors for the part that cannot be recovered from the main debtor. Of course, in specific litigation, the guarantor can include the main debtor and other guarantors as joint defendants when exercising the right of recourse, and the people's court can clarify the order of repayment when making a judgment.
31. In a joint guarantee, if the creditor only claims rights against some guarantors within the guarantee period, the creditor has no right to require other guarantors to perform the guaranteed debt on their behalf.
Article 29 of the Interpretation of the Supreme People's Court on Several Issues Concerning the Application of the Guarantee System in the Civil Code of the People's Republic of China: If there are two or more guarantors for the same debt, and the creditor claims that it has exercised its rights against some guarantors in accordance with the law within the guarantee period, the people's court shall not support the claim that it has exercised its rights against other guarantors within the guarantee period.
32. If a creditor fails to exercise its rights against some guarantors within the guarantee period, resulting in other guarantors losing their right of recourse after assuming the guarantee liability, the other guarantors have the right to claim exemption from the guarantee liability to the extent that they cannot recover.
33. If the main debt is reconfirmed, the main debtor loses the original right of defense of limitation, and the limitation of the main debt is recalculated due to interruption. The reconfirmation of the main debt does not affect the guarantor's right to enjoy and exercise the right of defense of limitation of the main debt.
34. If the guarantee contract stipulates that the guarantor shall assume the guarantee liability until the principal and interest of the main debt are paid off, etc., the guarantee period shall be six months from the date of expiration of the performance period of the main debt. If the creditor claims rights against the guarantor after the above six-month period, the guarantor shall not be liable.
35. If the creditor of a general guarantee files a lawsuit or applies for arbitration against the debtor within the guarantee period, and then withdraws the lawsuit or arbitration application, and the creditor does not file another lawsuit or apply for arbitration before the expiration of the guarantee period, the people's court shall support the guarantor's claim that it no longer bears the guarantee liability.
36. If the creditor of a joint and several liability guarantee files a lawsuit or applies for arbitration against the guarantor within the guarantee period, and then withdraws the lawsuit or arbitration application, and a copy of the complaint or a copy of the arbitration application is not served on the guarantor, and the creditor does not file another lawsuit or apply for arbitration before the expiration of the guarantee period, the people's court shall support the guarantor's claim that it no longer bears the guarantee liability.
37. The people's court shall not support the creditor's claim against the guarantor for the uncompensated portion six months after the end of the bankruptcy proceedings.
38. If the creditor knows or should have known that the debtor is bankrupt, but neither declares the creditor's rights nor notifies the guarantor, causing the guarantor to be unable to exercise the right of recourse in advance, the guarantor shall be exempted from the guarantee liability within the scope of the creditor's possible compensation in the bankruptcy proceedings.
39. In a mixed guarantee provided by a third party and secured by the debtor's own real estate mortgage, if the creditor cancels the mortgage registration for the debtor without the guarantor's consent and accepts other mortgage guarantees provided by the debtor, it should still be considered that the creditor has waived the security for the debtor's property, and the guarantor should be exempted from the guarantee liability within the corresponding scope.
According to Article 194 of the Property Law, "If a debtor creates a mortgage on his own property, and the mortgagee waives the mortgage, the priority of the mortgage, or changes the mortgage, other guarantors shall be exempted from the guarantee liability to the extent that the mortgagee loses the priority of compensation, unless the other guarantors promise to continue to provide guarantee." In the absence of evidence from China Construction Bank Daqing Branch and no claim that the guarantors such as Shi Lijing promised to continue to bear the guarantee responsibility when it released the mortgage, the guarantee responsibility of the guarantors such as Shi Lijing within the scope of the priority compensation rights of the 1256 mortgaged houses in the case of China Construction Bank Daqing Branch should be exempted. Case source: (2018) Supreme Court Min Zhong No. 966.
40. The creditor's fault leads to the loss of security, which is regarded as its abandonment of security. Because it damages the guarantor's sequential trust interest, the guarantor is exempted from the guarantee liability within the scope of the creditor's loss of priority compensation rights (within the scope of security).
Judgment point: In this case, the creditor's fault leads to the loss of security, and the creditor fails to fulfill the obligation of prudent attention, which is regarded as its abandonment of security. The guarantor is exempted from the guarantee liability within the scope of the creditor's loss of priority compensation rights (within the scope of security). Considering that the guarantor's guarantee scope is 1.2 million loan principal and interest, and the mortgaged property in this case is sold by the debtor to a third party at a price of 1.5 million yuan, the value of the mortgaged property exceeds the guarantee scope, so the guarantor does not need to bear any responsibility. Case source: Hebei High Court "[Case Explanation] Creditor Abandons Security, Personal Guarantee is Exempted within the Scope of Security".
41. The creditor does not set up security for the debtor as agreed, and the guarantor with trust interest is exempted from liability.
Judgment point: If the guarantor provides joint and several liability guarantee for the debt after learning that the debtor and the creditor have signed a pledge contract (and the guarantee contract does not stipulate the order of realization of the creditor's rights), but the creditor does not require the debtor to deliver the pledged property, resulting in the failure to establish the pledge right, it should be determined that the guarantor enjoys the sequential trust interest, and it has the right to be exempted from the guarantee liability within the scope of the value that the pledge right cannot be established. Case source: (2017) Supreme Court Min Shen No. 925.
42. If there is both personal guarantee and security provided by the debtor on the same creditor's right, and the joint fault of the creditor and the debtor causes the pledge right that should be established according to law to fail to be established, and the guarantor is not at fault for this, the creditor should bear the adverse consequences for the failure to establish the pledge right.
Judgment point: In mixed guarantee, whether other guarantors can be exempted from liability within the scope of the creditor's rights of the security provided by the debtor should be combined with the fault of the creditor and the principal debtor, whether the guarantor is at fault, whether the parties have agreed on the order of realization of the creditor's rights, and other factors, based on the principles of good faith, fairness, and the principle of the debtor's ultimate responsibility, comprehensively judge whether to protect the guarantor's reasonable sequential trust interest.
The joint fault of the creditor and the debtor causes the pledge right that should be established according to law to fail to be established, the debtor should bear the liability for breach of contract for the failure to establish the pledge right, and the creditor's failure to request delivery and supervision of the pledged property should be regarded as an act of abandoning the pledge right. Article 176 of the Property Law has clear provisions on the order of realization of creditor's rights when the security provided by the debtor and the personal guarantee provided by a third party coexist. The guarantor has reasonable trust in the prior repayment of debts with the debtor's pledged property. The creditor's abandonment of the pledge right damages the guarantor's sequential trust interest, and the guarantor should be exempted from the guarantee liability within the scope of the pledgee's loss of priority compensation rights in accordance with Article 218 of the Property Law. Case source: Supreme People's Court Gazette Case No. 1, 2018, published the Supreme Court's Judgment No. 925 (2017) Supreme Court Min Shen.
43. If the creditor explicitly waives the guarantee liability of some guarantors, other guarantors shall be correspondingly exempted from liability.
44. In the joint and several liability guarantee, when the creditor only claims rights against the principal debtor but does not claim rights against the guarantor, the statute of limitations for the guarantee debt is not interrupted due to the interruption of the statute of limitations for the principal debt. If the creditor requires the guarantor to bear the guarantee liability after exceeding the guarantee statute of limitations, the people's court shall not support it.
45. If the creditor knows that the renewed loan funds are used to repay the bridge funds, it should also be identified as "borrowing new to repay old", and the guarantor is exempted from liability.
The method of repaying the old loan with bridge funds and then repaying the bridge funds with new loans (renewed loan funds) does not change the essence of the borrower using new loans to repay old loans due to the intervention of bridge funds. It should be identified as lending to repay loans, and the rules of lending to repay loans apply. If the guarantor does not know that it is lending to repay loans, the guarantor is exempted from liability, unless the guarantor is the guarantor of the old loan.
In summary, in the context of the "Civil Code", the legal risks of creditors' external loans are far greater than those of guarantors.
More News