ON The Creditor's Subrogation

Planned economy system is the shackles of the development of civil law. Civil law gains its new life with the emergence of commercial economy and develops with the establishment of market economy system. Many of the major systems of our civil law, with creditor's subrogation system being one of them, came into being during the establishment and improvement of our socialist market economy system. Creditor's subrogation is an important way of maintenance of debt. It is a possibility which the creditor assumes rights against the third party in the name of the debtor. Creditor's subrogation system includes various aspects such as the concept of creditor's subrogation, ways and procedures of its exertion and its legal consequences etc.. The paper discusses creditor's subrogation system from the following six aspects.The first part deals with the definition of creditor's subrogation and its nature. As to the definition and nature of creditor's subrogation, different jurisprudents, ancient or modern, Chinese or foreign, may have different viewpoints. The author, starting by expounding some basic characteristics of creditor's subrogation such as its statutory nature and its innate nature, arrives at the conclusion that creditor'ssubrogation means a possibility for the creditor to assume rights against the debtor in its own name. The author further makes a distinction between creditor's subrogation and some relevant concepts such as creditor's rescission right, assignment of claim and procuration of creditor's right. The author, by analyzing comparatively different opinions concerning creditor's subrogation, holds that creditor's subrogation is a kind of substantial right -- debt maintenance, not a claim right nor a formation right.The second part discusses the characteristics and functions of creditor's subrogation. The author thinks that creditor's subrogation has four main characteristics and three main functions. The four characteristics lie in its adherence and subordination to creditor's right, the legal requirements as for its contents, procedures and ways of execution and its legal effects, its innate nature which is unconditioned by the subjective mind of the parties, and the limitation of creditor's subrogation. As for the functions of creditor's subrogation, the author mainly discusses its three main functions in our country, namely: first, it can make perfect our debt law system and protect the interests of the creditors; second, it is beneficial for the solution of acute problems such as " triangular debt" and "interlocking debt" so as to promote economic development; third, it is advantageous to thesolution of executive difficulty so as to economize judicial resources and set up the judicial authority of the people's courts.The third part deals with the conditions of the creation of creditor's subrogation. This is the core part of creditor's subrogation system. As for this, there are three different viewpoints among civil law scholars in our country, namely " theory of three contions", "theory of four conditions" and " theory of five conditions". The author agrees with the third viewpoint, that is, there exist five conditions in the creation of creditor's subrogation. Firstly, the creditor has objective, real and legally effective right against the debtor. Secondly, the debtor should have right over the subdebtor. Thirdly, the debtor is idle in assuming right against the subdebtor. Fourthly, the debtor performs its obligation to the creditor late and untimely. Fifthly, the creditor is facing the risk of unable to realize its right.The fourth part discusses the legal relationship of creditor's subrogation. Through analysis on creditor's subrogation system and in combination with the basic legal theories, the author proposes a new viewpoint as for the legal relationship of subrogation. The author holds that the legal relationship of subrogation is a composite legal relationship with two interrelated obligations and liabilities relationship coexisted.There are three subjects in such leg...