Court Orders Repayment of CNY 119,000 in Loan Dispute

A court in Eastern China City has ruled in favor of a plaintiff who sought repayment of three personal loans totaling CNY 119,000. The borrower failed to repay the amounts, and a guarantor was held liable for part of the debt. The defendants did not appear in court or present any defense.

The plaintiff, Mr. Chen, claimed that the first defendant, Mr. Tu, borrowed money on three separate occasions in late 2010 and early 2011. The loans were made on October 25, 2010 (CNY 50,000), November 5, 2010 (CNY 30,000), and January 24, 2011 (CNY 39,000). The second defendant, Mr. Tu (a different individual), agreed to act as a guarantor for the first two loans totaling CNY 80,000. Despite repeated requests, the borrower did not return any of the funds, and the guarantor did not fulfill his obligation.

During the court hearing, the plaintiff presented three written promissory notes as evidence of the loans and the guarantee. The defendants were summoned by public notice but failed to appear, and they did not submit any evidence or arguments. The court therefore treated the plaintiff’s evidence as unchallenged and admitted it into the record. The hearing proceeded in the absence of the defendants, and the court made its decision based on the submitted materials.

The court found that a lawful lending relationship existed between Mr. Chen and the borrower. Under the Contract Law, a borrower must repay a loan when it becomes due. The court also applied the Guarantee Law, which holds a guarantor jointly liable for the guaranteed amount. Because the borrower had not repaid any part of the debt, the court ordered him to return the full CNY 119,000. The guarantor was ordered to bear joint responsibility for the CNY 80,000 covered by his guarantee.

In its legal reasoning, the court emphasized that the promissory notes clearly documented the loan amounts, dates, and the guarantor’s undertaking. Since the defendants did not appear, they forfeited their right to challenge the evidence. The court relied on the principle that a guarantor who performs his obligation may later seek reimbursement from the borrower. The decision also included a provision for double interest on any delayed payment, as required by the Civil Procedure Law.

This case underscores the enforceability of written loan agreements and guarantees in Chinese courts. Even when defendants are absent, a court can issue a default judgment based on credible documentary evidence. Borrowers and guarantors should be aware that failure to appear or respond does not prevent a judgment against them. The ruling provides a practical reminder for lenders to keep clear records and for guarantors to understand the full scope of their liability.

Disclaimer: This article is for informational purposes only and does not constitute legal advice.