Gist of the Judgment of the People's Court Case Database 116: Disputes over the Right of Recourse (1)

Gist of the Judgment of the People's Court Case Database 116: Disputes over the Right of Recourse (1)

01. Reference case: The compensator has the right to transfer the lender's creditor's rights after substitution - a Shenzhen company v. Li Moujia, a dispute over the right of recovery

[Summary of the trial]:

I. The nature of subrogation is usually a guarantee or assignment of creditor's rights. When there is no guarantee in the contract, the act of substitution is not equivalent to assuming the guarantee liability, and in the case that the contract stipulates that the compensator obtains the status of a creditor after making compensation, the act of subrogation is actually a transfer of creditor's rights, and the creditor has the right to recover from the debtor after the assignment of creditor's rights and obtains the subordinate rights enjoyed by the creditor against the debtor, including the security right. Second, the right of recovery arises on the basis of statutory or agreement, and the law does not prohibit the parties from agreeing to recover from each other, and if the contract expressly stipulates that it is a guarantee liability, the act of substitution is actually the performance of the guarantee liability, and the compensator recovers from the debtor after assuming the guarantee liability, which is a statutory recovery and does not need to be agreed; If the compensator recovers from other guarantors, it must have an agreement to recover, and if there is no agreement, it cannot recover from other guarantors.

II. According to Article 14 of the Interpretation of the Supreme People's Court on the Application of the Civil Code of the People's Republic of China on the Guarantee System, the guarantor's act of accepting the creditor's rights shall be deemed to bear the guarantee liability.

The effective judgment of the court held that the lender was a real-name registered user of a certain platform, provided loans to the borrower through the platform, signed an electronic contract in accordance with the relevant rules of the platform, and authorized a company in Beijing to sign the "Loan Contract", Li Moujia as the borrower and Li MouB as the co-borrower signed the "Loan Contract" with a company in Beijing, Li Moujia confirmed the identity of the lender in the "Lender Information Form", the loan was actually lent, and the "Loan Contract" was established in accordance with the law and was binding on the relevant parties. Li X A and Zhang X claimed that the contract was not established on the grounds that the Loan Contract was not signed by the lender, but the court did not accept it. It should be made clear that the violation of the mandatory provisions of laws and administrative regulations is one of the statutory circumstances that lead to the invalidity of the contract, but the mandatory provisions here refer to the mandatory provisions of validity rather than the mandatory provisions of management. In view of this, the court found that the signing of the contract involved in the case was the true expression of the intention of the relevant parties, and the content did not violate the mandatory provisions of laws and administrative regulations, and was legal and valid.

In this case, Li Moujia overdue the repayment, and a Shenzhen company repaid the principal and interest of Li Moujia's loan to the lender in accordance with the Debt Subrogation Agreement, and after the Shenzhen company repaid, it had the right to recover the subrogated money from Li Moujia. A company in Shenzhen filed a lawsuit in this case on August 2, 2019, and the overdue interest should be calculated from that date, and the standard advocated by a company in Shenzhen is higher than the statutory standard, and the court adjusted the starting date, base and standard of the claim of a company in Shenzhen. The court did not support a company's claim for overdue interest for the excess part. As a co-borrower, Li X B should bear the joint responsibility for the repayment of the amount that Li X A should repay. The Debt Subrogation Agreement stipulates that after a company in Shenzhen repays its debts, it will obtain the rights of the lender and repay the creditor's rights, and the creditor's rights will be transferred to the ownership of a company in Shenzhen, and Mr. Zhang and Luo, as the guarantors of joint and several liability, shall bear the guarantee liability to a company in Shenzhen. A company in Shenzhen requires Zhang and Luo to bear the guarantee liability, and the guarantee liability should not be exempted before the guarantee period has passed. The opinions of Li X A and Zhang X on Li X A having repaid the loan in full and Zhang X not bearing the guarantee liability lacked basis and were not accepted by the court.

Case No.: :(2020) Jing 03 Min Zhong No. 5182

02. Reference case: Elements for the exercise of the right of recovery of shareholders after repeated transfers of "failure to perform or failure to fully perform the obligation of capital contribution" equity - Zhu XX v. Lu XX and Shanghai XX Energy Co., Ltd., a dispute over the right of recovery

[Summary of the trial]:

Even if the defective equity "has not been fulfilled or not fully fulfilled its capital contribution obligations" has been transferred several times, the company or creditors have the right to demand that all successor shareholders who knew or should have known that the equity was defective bear joint and several liability for capital filling. According to the principle of joint and several liability internal claim, the successor shareholder who has already assumed responsibility has the right to recover. For the establishment of the successor shareholder's right of recovery, the following requirements shall be met: first, the shareholder who succeeds to the defective equity has fulfilled the joint and several obligation to make up the capital, resulting in joint exemption, and second, the successor shareholder's performance of the capital compensation obligation exceeds its share of the joint and several liability.

The effective judgment of the court held that the reason for Zhu Moumou's claim for the right of recovery in this case was that the equity of an energy company in Shanghai transferred by Lu Moumou was defective, and Zhu Moumou made up the capital contribution on behalf of Lu Moumou, thus obtaining the right to recover from Lu Moumou. However, Lu Moumou is not the original shareholder of an energy company in Shanghai, and the source of his equity also comes from the transfer of the previous shareholder, and the main focus of the dispute in this case is: whether Zhu Moumou has the right to exercise the right of recourse. Combined with the requirements for the exercise of the right of recourse, it should be judged from two aspects: whether Zhu Moumou fulfilled the joint and several obligation to fill the defective equity capital, resulting in joint exemption, and whether Zhu Moumou's performed part exceeded the part he should bear.

Zhu Moumou did not fulfill the obligation to fill the capital for the defective equity.

According to the equity transfer agreement signed by the two parties, it is agreed that Lu Moumou and a Shanghai energy company have all accounted for and settled, and the two parties have no creditor's rights and debts, combined with the fact that Lu Moumou and a Shanghai energy company have remitted money to each other, it can be determined that these money transactions have been accounted for at the time of equity transfer, that is, the money invested by Lu Moumou in a Shanghai energy company will not be recovered, and it is reasonable to identify the money as Lu Moumou's capital contribution. Lu Moumou remitted a total of 5.51 million yuan to the company during the shareholding period, plus the payment of equity transfer money to Quan, it should be deemed that he has enjoyed the capital contribution of 1 million yuan to the company, and his investment in the company totaled 6.51 million yuan, and Lu Moumou received 2.24 million yuan from an energy company in Shanghai, and the 4.27 million yuan that Lu Moumou invested in an energy company in Shanghai will not be recovered after the discount, and it is reasonable to identify the amount as Lu Moumou's capital contribution, so Lu Moumou has completed the capital contribution obligation corresponding to 40% of the equity, and the equity transferred to Zhu Moumou is not

There is no defect, so in this case, it was the defendant Lu Moumou who fulfilled the obligation to fill the defective equity capital, which caused his former shareholders to be jointly exempted from liability, not the plaintiff Zhu Moumou. 2. The nature of Zhu's remittance to an energy company in Shanghai is not to bear joint and several liability for the capital filling of the defective equity. The equity transfer agreement stipulates that Lu Moumou holds 40% of the equity of an energy company in Shanghai, should contribute 4.24 million yuan, the actual capital contribution is 4.24 million yuan, and Zhu Mouhua voluntarily pays a premium of 4.55 million yuan to transfer 40% of the equity under the name of Lu Moumou, which shows that Zhu Moumou and Zhang have confirmed the fact that Lu Moumou's capital contribution is in place, even if Zhu Moumou is not clear about the situation of an energy company in Shanghai, but his spouse Zhang, as the founding shareholder and legal representative of the company, should be aware of the company's capital contribution, and also agree and recognize the above-mentioned equity transfer. It can be seen that Zhu Moumou knew that the equity was not flawed when the equity transfer occurred. The 2.24 million yuan that he remitted to an energy company in Shanghai after the transfer of equity was not to bear the joint responsibility of capital compensation caused by the defects in the equity, not to mention that Zhu Moumou undertook the part that exceeded his responsibility and enjoyed the right of recourse against the predecessor.

Case No.: :(2020) Hu 01 Min Zhong No. 7595

03. Reference case: Determination of the legal relationship between the guarantor and the borrower and other guarantors - Zhang Moujia v. Bai et al., a dispute over the right of recovery

[Summary of the trial]:

Paragraph 1 of Article 18 of the Interpretation of the Supreme People's Court on the Application of the Civil Code of the People's Republic of China on the Guarantee System stipulates that "if the guarantor who has assumed the guarantee liability or compensation liability recovers from the debtor within the scope of its liability, the people's court shall support it." "A guarantor who has assumed liability under this interpretation shall recover from the debtor to the extent of its liability. In reality, in addition to suing the guarantor for the amount of the loan, the guarantor of the substitution also claims interest during the period of capital occupation, and the interpretation does not clearly stipulate whether the interest can be claimed. In the course of hearing a case, the people's court may support the party's claim for interest.

II. The guarantor of substitution may exercise the right of recovery against other guarantors, but the recovery ratio shall be determined according to the number of other guarantors. At the same time, according to <中华人民共和国民法典>the third paragraph of Article 13 of the Interpretation of the Supreme People's Court on the Application of the Relevant Guarantee System, "in addition to the circumstances provided for 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", and the phrase "the part that cannot be recovered from the debtor" should be understood as the debtor's inability to perform its debts or its inability to repay its debts.

The effective judgment of the court held that there were two points of dispute in this case. Including: first, whether the right of recourse can claim interest; The second is whether some guarantors can recover from other guarantors after assuming the repayment liability, as well as how to determine the recovery ratio and the performance priority with the debtor.

1. Can the right of recourse claim interest?

When Bai X and Zhang X B applied for a loan from a bank, Zhang X A and Zhang X C provided guarantees for them. Zhang X A repaid the bank loan on behalf of Bai X and Zhang X B, and Bai X and Zhang X B had no objection to the substitution money, and did not recognize the interest claimed by Zhang X A.

Article 700 of the Civil Code of the People's Republic of China stipulates that after the guarantor assumes the guarantee liability, unless otherwise agreed by the parties, it has the right to recover from the debtor within the scope of the guarantee liability and enjoys the rights of the creditor against the debtor, but shall not harm the interests of the creditor. Defendants Bai and Zhang are the beneficiaries of the substitution payment, and the plaintiff Zhang Moujia's funds are occupied from the date of substitution, and the interest during the occupation period shall be calculated and paid by the beneficiaries Bai and Zhang X B in accordance with the 1-year interest rate III and 55% of the loan prime rate (LPR) published by the National Interbank Funding Center in June 2023 from June 13, 2023 to the date of repayment of the substitution. Accordingly, Bai and Zhang argued that the reason for not recognizing the interest could not be established.

2. Whether some guarantors can recover from other guarantors after assuming the repayment liability, as well as how to determine the recovery ratio and the performance priority of the debtor

Paragraph 2 of Article 178 of the Civil Code of the People's Republic of China stipulates that "the share of liability of jointly and severally liable persons shall be determined according to the size of their respective responsibilities: it is difficult to determine the average liability of the size of liability." If the actual liability exceeds their own share of liability, the jointly and severally liable person shall recover from the other jointly and severally liable persons. And the second paragraph of Article 13 of the Interpretation of the Supreme People's Court on the Application of the Civil Code of the People's Republic of China on the Guarantee System stipulates that: "Where two or more third parties provide guarantee for the same debt, and the guarantors have not made an agreement on mutual recovery and have not agreed to undertake 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 the other guarantors to share the unrecoverable part of the debtor in accordance with the proportion, the people's court shall support it." "Where guarantors Zhang X A and Zhang X C sign the guarantee contract at the same time, and Zhang X A assumes the guarantee responsibility, and requests that the other guarantors Zhang X C share the part that cannot be recovered from the debtors Bai X and Zhang X B in accordance with the proportion of one-half, it should be supported.

[Case number] :(2023) Ning 0381 Min Chu No. 2202

04. Reference case: Judicial judgment and scope of recovery of the transfer of creditor's rights and assumption of guarantee liability in a financial lease contract - a dispute over the right of recovery between a science and technology development company in Hangzhou v. an Internet café in Qinghe County

[Summary of the trial]:

In a financial lease contract, if the lessor's claims are guaranteed by two or more third parties at the same time, and some of the guarantors pay the rent and accept the rent claims, it is an act of assuming guarantee liability, and cannot be recovered from other guarantors if there is no special agreement or does not meet other statutory circumstances.

The effective judgment of the court held that the third party, Xin Mou Financial Leasing Co., Ltd., and the defendant Qinghe County Internet café established a financial leasing legal relationship in accordance with the law, and after the contract involved in the case was concluded, the third party, Xin Mou Financial Leasing Co., Ltd., performed the payment obligations under the contract in accordance with the contract, and the defendant Qinghe County Internet Cafe failed to pay the rent on time, which constituted a breach of contract. The plaintiff, Hangzhou Science and Technology Development Co., Ltd., as the guarantor of joint and several liability, compensated the defendant Qinghe County Internet café for the rent owed to the third party, Xin XX Financial Leasing Co., Ltd., and transferred the creditor's rights in accordance with the law, according to the "Supreme People's <中华人民共和国民法典>Court's Ruling on Application". Article 14 of the Interpretation on the Guarantee System stipulates that if two or more third parties provide guarantee for the same debt, and the guarantor accepts the creditor's rights, the people's court shall determine that the act is a guarantee liability. On this basis, the court held that the plaintiff's act of substituting rent and accepting the creditor's rights was an act of assuming guarantee liability, so the cause of action in this case should be a dispute over the right of recovery. According to Article 700 of the Civil Code of the People's Republic of China, after the guarantor assumes the guarantee liability, it has the right to recover from the debtor within the scope of the guarantee liability, unless otherwise agreed by the parties. Therefore, the plaintiff, Hangzhou Science and Technology Development Co., Ltd., has the right to recover the rent of RMB 35,034 and the corresponding interest loss from the defendant an Internet café in Qinghe County. On the issue of whether defendants An XX, Xun XX, and Lian XX should bear the liability for repayment, according to Article 13 of the Interpretation of the Supreme People's Court on the Application of the (Civil Code of the People's Republic of China) on the Guarantee System, where two or more third parties provide guarantee for the same debt, and the guarantors agree to recover from each other, or each guarantor signs, seals, or fingerprints on the same contract, the guarantor may request the other guarantors to share the part that cannot be recovered from the debtor in accordance with the proportion. Where a guarantor who has assumed the guarantee liability requests that other guarantors share the part that cannot be recovered from the debtor, the people's court will not support it. In this case, the plaintiff, Hangzhou Science and Technology Development Co., Ltd., did not adduce evidence to prove that there was a situation that could be recovered from other joint and several liability guarantors, so the plaintiff's request that the defendants An XX, Xun XX and Lian XX bear the joint responsibility for repayment lacked factual and legal basis. However, because the defendant An XX is an investor in an Internet café in Qinghe County, according to article 31 of the "Law of the People's Republic of China on Sole Proprietorship Enterprises", if the assets of the sole proprietorship enterprise are insufficient to pay off the debts, the investor shall use his other personal assets to pay off. Therefore, defendant An XX, as an investor in defendant Qinghe County Internet café, should use his other personal assets to pay off defendant Qinghe County's Internet café's assets when its assets were insufficient to pay off its debts.

Case Number: :(2021) Hu 0115 Min Chu No. 34155

Transferred from the same judgment rule for similar cases