Study On The Status Of Debtors In Litigations Of Creditors' Subrogation

The creditors' subrogation system was established in China in 1999 by the Contract Law and judicial interpretations thereof,designed to ensure that the obligatory properties of principal debtors(the term “principal debtors” is used to refer to “debtors” herein,so as to conveniently distinguish them from “subordinate debtors”)shall not be reduced by their indolence in exercising their creditors' rights against their subordinate debtors so as to protect the rights of creditors of the creditors.However,in practice,the creditors' subrogation system does not play its due role.The key reasons for this lie in the most difficult procedural obstacles caused by the ambiguity of the status of principal debtors in participating in litigations of creditors' subrogation and the unclarity of their rights and obligations in such litigations,apart from the arguments in the creditors' subrogation system of China which needs to solve.It is because that the Civil Procedure Law of China and judicial interpretations thereof do not specifically define the status and rights and obligations of principal debtors in litigations of creditors' subrogation,and such silence in the legislation inevitably results in endlessly different understandings and everlasting arguments in practice.For example,some scholars hold that the status of principal debtors in litigations of creditors' subrogation shall be witnesses,some scholars hold that the status of principal debtors shall be joint defendants or joint plaintiffs,and some other scholars hold that the status of principal debtors shall be third parties entitled to independent claims;yet,the prevailing opinion holds that principal debtors shall be third parties not entitled to independent claims.Such arguments in theories directly affect the role played,the rights enjoyed,and obligations undertaken by principal debtors in litigations of creditors' subrogation,and the adjudged force of judgments of courts,and further affect whether the creditors' subrogation system can fully play its due role in practice.Therefore,it is especially urgent to specify the status of principal debtors in litigations of creditors' subrogation and make clear their rights and obligations if we really want to let the creditors' subrogation system play its due role and effectively protect the rights of creditors,and simultaneously prevent the procedural rights of principal debtors from being infringed upon.This Article is composed of four parts.Part One points out the problems,analyzing the practical problems caused by the ambiguity of the status of principal debtors in litigations of creditors' subrogation and the unclarity of their rights and obligations in such litigations.Party Two briefly introduces the creditors' subrogation system and analyzes its systematic functions and limitations in the present contentious procedures.Part Three introduces the third party system in China,make comparisons with the third party systems respectively in Germany,Japan,the USA,France and etc..Part Four analyzes and expounds whether the principal debtors shall be witnesses,joint plaintiffs,joint defendants and third parties entitled to independent claims or third parties not entitled to independent claims as perceived by the prevailing opinion when they participate in litigations of creditors' subrogation,or shall be any of the roles of third parties in Germany,Japan,the USA or France.If none of the aforesaid roles of third parties may completely cover the roles of principal debtors litigations ofcreditors' subrogation,the third parties in litigations of creditors' subrogation in China shall be reacquainted,their special characteristics shall be acknowledged,and they shall be granted the special status of third parties.Finally,the author's assumptions of the special status,rights and obligations of principal debtors in litigations of creditors' subrogation are expounded,with the desire to provide thoughts to identify the status of principal debtors in litigations of creditors' subrogation and clarify their rights and obligations in such litigations in China,so as to approach the purpose to further play the value of creditors' subrogation system and also properly protect the principal debtors' procedural rights.