Studies On The Legal Issues Of Loans Repaying

Loans repaying is common in banking practice. For it's characteristic, the effectiveness of the new loan contract and its suretyship liability are always the most disputed problems in theory and practice. Based on the cases of the Supreme People's Court, this thesis discussed the main legal issues on loans repaying, such as the effectiveness of the new loan contract, the effectiveness of the suretyship contract of the new loan contract, how to affirm the activity of loans repaying, the surety liability of the new loan contract, and so on.The thesis analyses the meaning and the essence of the loans repaying. The author considered that it should be regarded as Novatio, or can be called the establishment of the new contract and the termination of the old contract, on the essence of loans repaying. It is different from the modification of a contract, and it has an essential distinction with the deferred payment. Loans repaying means the termination of the old contract. This is the precondition to discuss the issues on loans repaying.As far as the effectiveness of the new loan contract is concerned, the author thought that it should be effective. The most important reasons include: 1)the intention expressed of the lender and borrower is genuine; 2)the loan contract itself doesn't damage the interests of a third party; 3)it doesn't violate the compulsory provisions of the laws and administrative regulations. The harm to the finance system shouldn't be the reasons to deny the effectiveness of the new established loan contract; for it is the task of the economic laws to regulate the banking practice. Besides, the effectiveness of the new established loan contract has been affirmed in practice by the official. On the other hand, denying the effectiveness of it can't solve the disputed problem between the lender and borrower. Furthermore, the result of the negativism would make the problems more complex.On the effectiveness of the suretyship contract of the new loan contract in loans repaying, the opinion of the author is that it should be reviewed carefully. If the useage cause in the contract was described as `buy the raw and processed materials`, `working capital` and so on, instead of `loans repaying`, the suretyship contract would be determined to be null and void, for the reason of malicious collusion. The exception is that the surety known or should know that the new loan was used to refund, while the suretyship contract was established.On how to affirm the activity of loans repaying, the author thinks the criterion is the composing conditions in law, instead of the refund activity in practice. As long as the surety proved the lender and borrower have the action of loans repaying, the surety has just finished his burden of proof, and shouldn't prove the same intention expressions between the lender and borrower.The surety liability of the new loan contract is bone of contention. The surety bears the liability on condition that the surety know the fact that the new loan would be used to repay the old loan, according to Supreme People's Court Interpretation on Guaranty Law of the People's Republic of China. The author agreed with this regulation. However, the judicial interpretation make an exception that the surety should bear the liability still, if the surety in both two loan contracts was the same one.The author disagrees with it, and advises to delete this exception. If the old loan has been used to repay the older for many times, is it the necessary condition that the surety knows the loan was used to repay when he consent to bear the suretyship liability for the first time? We couldn't find the solution in the judicial interpretation. In the opinion of the author, loans repaying means the establishment of the new contract and the termination of the old contract, and the surety bear suretyship liability because of his knowing the fact that the loan has been used to refund, therefore, the surety should bear the suretyship liability as long as he knows the nearly loan repaying. Besides, if the surety renounces the claim to demur at knowing the fact of loans repaying, he would bear the surety liability all the same.