Application Of Bank Deducting For Outstanding Loan Of The Accerlaration Clause In Bankruptcy Proceedings

Credit business is the main business of commercial banks and the important source of corporate financing.loan acceleration clauses are widely used in bank loan contracts and have gradually become a commercial practice for the banking industry to conduct credit business and have been retained in loan contracts in the form of format clauses.The application of the loan acceleration clause and the agreement of deducting for outstanding loan have indeed played an important role in the bank's rapid liquidation and maintenance of loan security.When the banks specifically apply the clause in the loan contract,although the causes for acceleration are slightly different,it is usually accompanied by the agreement of deducting for outstanding loan.When the enterprise is not bankrupt,the debt redemption on the contract law follows the principle of “first come,first served”.It is understandable that banks can achieve priority liquidation by deducting for outstanding loan than other creditors.However,when the enterprise is in bankruptcy,the bank's act of deduction is contrary to the principle of general settlement in bankruptcy law,which has caused unfair results to other creditors.If the bank's deduction after announcing the loan is accelerated occurs within the retroactive period of the bankruptcy revocation right,it is faced with the risk of being revoked.This paper starts with the effectiveness of the loan acceleration clauses,and after excluding unreasonable causes of acceleration,the validity of the provision shall be recognized legally,on premise of which,this paper discusses the application of the bank deduction and the right of set-off.When the behavior of bank decucting does not meet the requirements for the exercise elements of the right of set-off,the relationship between bank deduction and bankruptcy revocation right is discussed.This paper is divided into four parts in addition to the introduction and conclusions,:In the first part,the author starts with the case of the Agricultural Bank of China Ltd.Rizhao Langshan Branch vs.Beijing Dentons(Jinan)Law Firm requesting the revocation individual liquidation,briefly analyzes the reasons for the judgment of the first and second instance judges and summarizes the representative and controversial issues faced by judges in dealing with bank deductions in this case;In the second part,the author discusses the reasons for the acceleration of the loan expiration,and determines the effectiveness of the loan expiration clause on this basis.On the premise of excluding unreasonable causes of acceleration,as long as the loan accelerationclause voluntarily reached by both parties does not violate the mandatory provisions of laws and administrative regulations,and does not harm the public interest of the state and society,its effectiveness should be recognized;In the third part,the author analyzes the nature of the agreement of deducting for outstanding loan reached by the bank and the debtor enterprise,and consider it to be the performance of the right of set-off in enssence.And the author also discusses the different legal relationships between the depositor(debtor enterprise)and the bank.It is considered that the depositor and the bank own the general characteristics of the creditor-debtor relationship,but because of the different accounts,there are other legal relationships,so only some deposits of the debtor enterprise can be the object of application of the right of set-off;In the fourth part,the author analyzes the necessity of including the subjective elements into the category of the elements of bankruptcy revocation right,and believes that the subjective good faith of the bank in the implementation of deduction can be a just defense.At the same time,a detailed discussion is made on the scope of “do good to the debtor's assets”in Article 32 of the Bankruptcy Law.