Insights

Whether the debit note signed by only one party in Ningbo is a joint debt of husband and wife.

Ningbo Author：LuXu WANG

During the marriage, Mr. Zhang borrowed 500000 yuan from his friend and issued an IOU, but his wife did not sign it. After the loan matured, the friend sued both Mr. Zhang and his wife, demanding that they jointly repay the debt. The wife felt deeply wronged: she hadn’t signed the agreement and was unaware of the loan—so why should she be responsible for repaying it? The answer to this question hinges on the actual purpose of theBorrowings, not on whether or not she signed it. The conclusion is: whether the IOU signed by only one party belongs to the joint debt of husband and wife depends on whether the loan is used for the joint life, joint production and operation of husband and wife, or whether it is based on the joint intention of both parties. Large loans beyond the needs of the family's daily life (such as 500000 yuan in this case) are not joint debts by default. The creditor shall prove that they are used for the joint life or operation of the husband and wife-if proof cannot, the spouse.

1. legal basis: three-tier structure of joint debt determination

Article 1064 of the the People's Republic of China Civil Code stipulates that: the debt of joint signature of both husband and wife or mutual intention of one of the husband and wife, as well as the debt of one of the husband and wife for the daily needs of the family in his own name during the marriage relationship, belong to the joint debt of husband and wife; the debt of one of the husband and wife during the marriage relationship exceeds the daily needs of the family in his own name, does not belong to the joint debt, however, the creditor can prove that the debt is used for the joint life of the husband and wife, joint production and operation, or on the basis of the joint intention of the husband and wife.

Breaking down this provision reveals a three-tiered structure for determining marital joint debt:

  1. Common meaning representation layer: both parties sign together, jointly issue a debit note, or one party ratify afterwards (such as WeChat recognition, joint repayment, coming forward to negotiate repayment plan), the debt is the common debt. This is the least controversial layer, and the party advocating common debt only needs to prove the existence of "common meaning.
  2. family affairs agency layer: the debts incurred by one party in his own name for the daily needs of the family (daily food, clothing, housing, transportation, children's education and medical care, etc.) belong to the scope of "daily family affairs agency". Even if the other party does not sign, it is presumed to constitute a common debt. At this level, creditors are not required to provide additional evidence, but the scope is limited to “the needs of daily family life.”
  3. Use of proof layer: large loans (such as 500000 yuan) beyond the daily needs of the family are not joint debts by default in law; if creditors claim joint debts, they must provide evidence to prove that the loan is used for the joint life, joint production and operation of husband and wife or based on the common intention of both parties-the burden of proof lies with the creditor, and the spouse is exempted from liability if proof cannot be provided.

"Family Daily Life Needs" does not have a national unified amount standard. The court will make a comprehensive judgment based on the local living standard, family income, loan amount, usage and other factors: tens of thousands of yuan of medical expenses and decoration expenses may belong to the scope of daily life, while hundreds of thousands of yuan of investment and large consumption are obviously exceeded. In the Ningbo area referee, a loan of 500000 yuan is usually considered to be "significantly beyond the daily needs of the family" and must be proved by the creditor to complete the use.

2. situation breakdown: under what circumstances "return without signature"

A promissory note signed by only one spouse may be deemed a joint debt of the spouses in the following circumstances:

  1. The loan is used for family purchase, decoration and car purchase: The money flows to the real estate, the family's bulk consumption, and benefits both parties, even if only one party signs, it is usually considered as a joint debt.
  2. The loan is used for children's education, medical treatment, studying abroad and other major family expenses: It belongs to borrowing for the benefit of the family, the spouse benefits, and tends to have joint debt.
  3. The loan is used for the business jointly operated by the husband and wife.: The money goes into the joint operating account and is used for the purchase turnover, the operating income belongs to the family, and the debt belongs to the joint debt; if one party operates individually, it depends on whether the operating income is used for the family to live together-if the income goes home, the debt may be regarded as joint, otherwise it is not.
  4. ex post facto ratification of the spouse: the party who has not signed the contract will sign the debit note afterwards, promise to repay the loan in the collection record, repay part of the loan with common property, etc., which constitute ratification and turn into common debt.
  5. The loan amount is within a reasonable range for daily living expenses.: Small loans (such as family emergency loans within tens of thousands of yuan) and the purpose is indeed used for family life, fall into the category of family agency.

On the contrary, the following situations usually belong to the personal debt of the borrower: the loan is used for illegal activities such as gambling, drug taking, usury and on-lending (this kind of loan may be invalid due to violation of public order and good customs); the fictitious debt of one party or malicious collusion with the creditor to damage the interests of the spouse; the loan is obviously beyond the needs of the family and has nothing to do with the family (personal profligacy, personal spending, personal investment failure, financing of the third party, etc.); the husband and wife have separate property and the creditor is informed. If the divorce agreement or divorce judgment stipulates that "the debt shall be borne by one party", it shall only have internal effect and cannot be used against bona fide creditors, but it may be recovered from the other party in accordance with the agreement after the external settlement.

Key points of attack and defense of 3. creditors and non-borrowers

When the creditor lends a large sum of money, it should: require both husband and wife to sign together, or indicate the purpose of the loan in the debit note; pay by bank transfer and note the purpose, and keep the evidence of capital flow; if the spouse is found to have not signed, timely fix the evidence of "common meaning" or "for family" through written collection, reconciliation confirmation and other ways to avoid no evidence after oral communication.

The non-borrowing party (unsigned spouse) should be defended from three levels: first, keep records of the family's daily expenses and personal income to prove that the family life does not depend on the loan, and the large amount of the loan is not used for the family to live together; second, preserve uninformed and unrecognized evidence-do not easily sign the collection form, do not replace repayment, and do not make a promise to "repay together" in chat; Third, actively respond to the lawsuit after being sued, advocating that the creditor should prove the purpose of the loan, and should not be treated negatively because "I did not sign"-negative response may lead to default judgment and take the adverse consequences of failing to prove on his head.

4. List of Evidence and Key Procedural Points

The evidence organization of this kind of dispute has different emphases according to different subjects:

The list of evidences for creditors to claim common debts: debit notes, transfer vouchers (bank records, Alipay WeChat records), evidence of the purpose of borrowing (chat records, purchase contracts, consumption records), evidence of the flow of funds to live together or operate together, evidence of spouse ratification (supplementary signature, joint repayment, commitment records).

The evidence list of non-borrowing party's defense: household income and expenditure flow (proving that the family does not need to borrow or the loan does not enter the family), proof that the personal income is sufficient to cover the household expenditure, consumption records unrelated to the loan, communication records without knowledge and recognition, evidence that the loan flows to personal consumption or illegal purposes (you can apply to the court to obtain the other party's account flow to find out the whereabouts of the money).

Procedural, the joint debt case sued by the creditor is under the jurisdiction of the court of the defendant's domicile, and the parties in Ningbo should respond to the lawsuit in the courts of all districts (counties and cities) in Ningbo, and can also be handled online through the "People's Court Online Service (Zhejiang)" small program; in the lawsuit, you can apply to the court for an investigation order to get the borrower's bank flow and transfer records, identify the actual whereabouts of large loans-the whereabouts of the money is often a matter of knowing whether it is for the family or for the individual. If a jointly identified debt remains unpaid after the judgment, enforcement may be sought; if the judgment determines that the debt is personal, the risk of being sued as a spouse is eliminated.

Boundary and Deduce Cases of 5. "Family Daily Life Needs"

"Family Daily Life Needs" is a watershed to judge the nature of IOUs, but the law does not define a national unified amount line, and the court usually makes a case-by-case judgment based on the following factors: the relationship between the amount of loans and the level of family income (the family with a monthly income of 20,000 borrows 50,000 for emergencies, and the family with a monthly income of 5,000 borrows 500,000, which is completely different in nature); the purpose of borrowing (children's tuition fees, medical first aid and daily purchasing belong to the category of daily life; The down payment for house purchase, large investment and luxury consumption obviously exceed); The local living standard (the reasonable amount in economically developed areas such as Ningbo is higher than that in underdeveloped areas); The actual situation of the family at that time (whether there were any major expenses and whether it was in the period of house purchase and decoration). The criterion for determination is “both the proportion and the purpose matter”; it is inaccurate to discuss whether debts exceeding a certain amount are necessarily personal without considering the family’s actual circumstances.

In order to make it easy to understand, the following three sets of scenes show the applicable differences of the same rule: Scene 1, the husband borrows 60000 yuan for his wife's hospitalization operation, but the wife doesn't sign it -- the medical expenses belong to the daily needs of the family, and it is generally recognized that the common debt should be repaid by the wife; Scene 2, the husband borrows 500000 yuan for personal stock speculation, without the wife knowing, the money goes directly into the husband's securities account-obviously beyond the daily needs and not used for the family. The creditor must prove that the stock speculation income is used for the family or the husband and wife's joint operation. What cannot be proved is personal debt. Scenario 3: The husband borrows 300000 yuan in his own name to invest in his own sole proprietorship shop, and the operating income is used for family expenses-although it exceeds daily needs, but belongs to "for the joint production and operation of husband and wife" and husband and husband and wife. The difference between the three scenarios again points to the same review clue: the flow of money to families living together and operating together is the substantive basis of common debt.

In practice, there is another kind of situation that should be specially pointed out: if one of the spouses signs in the blank of the debit note or collects money on behalf of the other, it may be identified as joint intention or ratification; if the other party provides guarantee for the loan, it shall be independently liable according to the legal relationship of guarantee. Both signatures and guarantees imply liability, and non-borrowers must be cautious before writing on documents involving loans.

6. The issue of recourse after the non-debtor party is forced to make repayment.

Even if the spouse is finally determined to be responsible for the settlement of the joint debt, it does not mean "paying for nothing"-the internal recovery mechanism is an important relief channel. Article 1089 of the Civil Code stipulates that the joint debts of husband and wife shall be repaid jointly; if the joint property is insufficient to pay off or the property belongs to each other, the two parties shall agree to pay off, and if the agreement fails, the people's court shall make a judgment. Article 35 of the Interpretation (I) stipulates that after one party has assumed responsibility for the settlement of the joint debts of the husband and wife, it may claim that the other party shall bear the corresponding debts in accordance with the divorce agreement or the effective document of the court. This means that if a spouse who has not signed the agreement has paid off an amount exceeding their share of the debt to a third party, they have the right to seek reimbursement from the spouse who incurred the debt.

There are four practical points of recovery: first, the scope of recovery is limited to "exceeding the share to be borne"-in principle, both parties bear half of the common debt (there is an agreement from the agreement), and one party will exercise the right of recovery on the part to be borne by the other party after paying all or most of the debt; second, if the divorce agreement or judgment has agreed on the debt sharing ratio, the recovery will be calculated directly according to the ratio without re-determined the nature of the debt; third, if there is no agreement at the time of divorce, the court in the recovery suit will determine the internal sharing ratio in the light of the reasons for the formation of the debt, the purpose, the income of both parties and other factors. In practice, it is also suggested that if the non-borrower can prove that the debt belongs to the other party's personal debt in the response stage, it is the best outcome. No matter which step you take, the settlement document (bank transfer, court execution bill) is the core evidence that must be preserved.

class case reference: the external loan handled by one party in the marriage, which the court determines is not beyond the scope of the family agency, belongs to the joint debt of husband and wife. It can be seen that whether a debit note signed by only one party is a joint debt depends on whether the loan is used for the daily life of the family, common life or common production and operation, and the evidence of the parties. Trial court: Zhejiang Xiangshan County People's Court Case No.:(2016) Zhejiang 0225 Minchu No. 3525; Source: Ningbo Local Marriage Case Bank.

7. Frequently Asked Questions

If you didn’t sign it, do you definitely not have to pay it back?

Not necessarily. Borrowing for the daily needs of the family (e. g. family emergencies, children's expenses) is a joint debt even if the spouse does not sign it. Whether or not a signature is provided merely determines the starting point; it does not constitute an exemption from liability under the insurance policy.

Must creditors provide proof of the purpose for all large-amount loans?

Yes. Large loans that exceed the daily needs of the family are not part of the common debt by default, and the creditor must prove that the loan was used for the husband and wife to live together, to produce and operate together or to express their common will, otherwise the spouse is not responsible. This is the evidentiary rule established in Article 1,0

64of the Civil Code.

During a divorce, if the parties agree in their settlement that one spouse will assume all debts, can the creditor still seek repayment from the other spouse?

Yes. An agreement on debts contained in a divorce agreement or a court judgment is only effective between the spouses and cannot be invoked against bona fide creditors; creditors may still bring suit against both spouses to require them to jointly repay the debt. After one party has paid more than its share of the external liability, it may seek reimbursement from the other party pursuant to an agreement or a court judgment.

The loan was used for gambling—does the spouse have to repay it?

No need. If the lender knows or should know that the loan is used for gambling, drug abuse and other illegal and criminal activities, the loan relationship itself may be deemed invalid, and the debt is not a joint debt of the husband and wife. The non-borrowing party may assert that the debt is unrelated to the family and, if necessary, report it to the public security authorities.

8. Lawyer's Practical Insights

For a promissory note signed by only one party, does the spouse also have to repay the loan? The answer does not depend on whether or not the spouse signed it, but rather on the actual purpose for which the loan was used. In practice, there are three levels of judgment: if both parties sign jointly or ratify afterwards, it is a common debt; If one party bears the daily needs of the family in his own name, even if the other party does not sign it, it is presumed to be common. Large loans that exceed the needs of daily life do not belong to common debts by default, and the creditor shall prove that the money was used for the couple's common life or common operation.Only by understanding these three layers can we know where to go on offense and defense. Non-borrowers should especially focus on the third layer.

If they are sued together, the unsigned party does not need to panic, and first self-check with three points: whether the money is known to themselves, whether it benefits, and whether it is used for family joint expenses; whether the amount of borrowing is obviously beyond the daily needs relative to the family income; what is the relationship between the creditor and the borrower, and where the money actually flows. Accordingly, it is necessary to prepare proof of one's own income, records of household expenses, separate borrowing by the other party and evidence of unclear use, indicating that the creditor has not completed the use of the evidence. On the other hand, if you are a creditor, you should focus on proving that the money is used for the purchase of a house, decoration, joint operation or confirmation by both parties.

There are two points that are easy to be ignored: one is the recovery after passive settlement. If you repay the personal debt for the other party in divorce or execution, you should keep the repayment certificate and you can recover from the other party in the future; the other is not to make ratification without knowing it, for example, you can reply "we will repay" in the dunning information casually, or leave no trace after paying for the other party, all may be understood as recognition of common debt. When negotiating or mediating, if there are differences on the nature of the debt, it is better to write clearly "who the debt belongs to, who is external, who is internal" than to agree in general that "the debt will be dealt with separately", otherwise it will only be more difficult to prove if there is another dispute in the future.

Whether the debit note signed by one party constitutes the joint debt of husband and wife depends on two variables of "borrowing purpose + common meaning": if it is used in the daily life of the family, living together and operating together, the spouse shall bear the responsibility; if it exceeds the needs of daily life and the creditor cannot prove the purpose, the spouse shall be exempted from liability. For lenders, the safest risk control is "co-signing"-let the husband and wife jointly sign and indicate the purpose, with bank transfer to retain the flow of funds. Either side should understand that between the "name on the debit note" and the "common debt", there is a level of purpose review.