Absconding husbands, homeless wives and helpless creditors: Safeguarding the interests of stakeholders during enforcement proceedings

Alvin Sia

LLM Candidate,  Peking University School of Transnational Law

Women’s property rights were restricted by social norms in imperial China.[1] Property was passed down through male heirs.[2] In most cases, wives could not inherit property upon their husband’s death.[3] Most property brought by a wife into marriage belonged to her husband’s family.[4] Meanwhile, a wife was beholden to her father before marriage and subordinate to her husband after marriage.[5] Against this backdrop, there is a Chinese saying that “a wife pays for her husband’s debts”.[6]

This saying still holds true under existing marriage laws of the People’s Republic of China. Creditors may enforce against property owned jointly by the non-debtor spouse and debtor spouse. In many cases, the husband is the borrowing spouse.[7] This has resulted in cases where the husband absconds from debt while the wife is forced to sell property to pay off the creditor.[8]

Aside from the non-debtor spouse, the creditor sometimes faces difficulties in recovering debts due to actions of the debtor. Debt enforcement can sometimes be likened to a game of cat-and-mouse. While the creditor attempts to execute against debtor’s property, the debtor may evade enforcement by hiding or transferring property to a third party.

In comparison, there are mechanisms and limitations to safeguard interests of non-debtor spouses in other jurisdictions. In civil law jurisdictions such as France, if the debtor spouse takes out a personal loan, creditors can only enforce against separate assets belonging to the debtor spouse. In US community property states, there are exceptions to prevent creditors from seizing residential homes of non-debtor spouses. In Taiwan, non-debtor spouses can claim compensation if they help pay off their spouse’s personal debt. In common law jurisdictions, creditors can only enforce a debt against the debtor’s share of property, leaving the non-debtor’s share of property intact.

This article argues that Chinese marriage laws can be fine-tuned to protect non-debtor spouses while preserving creditors’ enforcement rights. This article is divided into four sections. The first section introduces the concepts of community property (夫妻共同财产)and joint marital debt (夫妻共同债务) under Chinese marriage laws. The second section examines issues faced by creditors and non-debtor spouses in enforcement against community debt. The third section discusses whether such issues arise in other jurisdictions. References are made to the French and German Civil Code, the Civil Code of Taiwan, US community property states, as well as case precedents in common law jurisdictions. The fourth section proposes adopting legal mechanisms from these jurisdictions to strike a balance between the rights of creditors and non-debtor spouses.

Section I – Marriage laws in China

Legislative reforms in women’s property rights

In imperial China, it was difficult for women to hold and acquire property during marriage due to a patrilineal system based on Confucian ideology.[9] In a patrilineal system, only men could inherit property as property was passed down to male heirs.[10] During marriage, the scope of a woman’s personal property was limited. Apart from the bride’s clothing and personal possession, all other property brought by the wife into the marriage belonged to the husband’s family.[11] In any event, traditional family structures confined women to a domestic household role, which severely hampered her ability to earn income and acquire property.[12] The lowly status of women as compared to men is reflected in the old Chinese saying, “married daughters are like spilt water”, someone that is no longer a member of her uterine family.

During the Republican period, the Guomindang party passed a resolution on the Women’s Movement, pledging to support the principle of gender equality under the law.[13] Meanwhile, Republican lawmakers rejected patrilineal principles in imperial China.[14] These culminated in the passing of the Republican Civil Code of 1929.[15] Under the Republican Civil Code, property no longer belonged to the patriline but rather to the conjugal unit. In particular, property acquired by spouses during marriage was considered community property.[16] A wife could manage, use and dispose property she owned and inherited during marriage.[17] Thus, Republican civil law broke away from legal and gender norms tied to Confucian patrilineal ideology.[18]

Following the establishment of the People’s Republic of China in 1949, the Republican Civil Code was abolished in mainland China[19] but remained effective in Taiwan. The following year, the 1950 Marriage Law of the People’s Republic of China (“1950 Marriage Law”) was enacted. Like the Republican Civil Code, the 1950 Marriage Law[20] expressly conferred on women exclusive property rights during marriage. Under the 1950 Marriage Law, both husband and wife could inherit property.[21] Each spouse had equal rights to manage, use and dispose family common property (家庭共同财产).[22] In addition, following a divorce, the wife retained ownership rights over property owned before marriage.[23] These provisions formed the basis for the community property system, which was well-suited for the period following the Chinese Civil War, when there was economic strife and poverty.[24] The community property system merged the property each spouse had owned before marriage with what they individually or collectively acquired during the marriage.[25] This system emphasised the role of marriage and family in safeguarding people’s livelihood.[26]

In 1980, the community property system was expanded to give spouses the liberty to designate whether property was owned jointly or separately by them.[27] This expansion was made in light of an increase in quantity and variety of property owned by spouses during the 1980s. The 1980 Marriage Law thus gave effect to spouses’ liberty in deciding how to own property within marriage.[28] Since the 1980 Marriage Law, jointly-owned property by spouses was referred to as “joint marital property” (夫妻共同财产) rather than “family communal property” (家庭共同财产).[29]

In 2001, the 1980 Marriage Law was amended to clarify the scope of joint marital property.[30] The Marriage Law of the People’s Republic of China (2001 Amendment) (“2001 Marriage Law”)[31] provides that wages, income and bonuses are jointly owned by the married couple.[32] Pre-marital property and articles of living specially used by either party, are separately owned by one spouse.[33] The 2001 Marriage Law introduced new vocabulary such as “to each their own” (各自所有) that stressed individual possession of property before and after marriage.[34] These amendments gave further effect to spouses’ liberty in owning property during marriage, by delineating the scope of joint marital property.[35]

Thus, developments in Chinese marriage laws generally improved women’s rights to own property during the subsistence of marriage. However, women’s rights towards property after divorce are not as well protected in two aspects. First, most marital homes are in the names of husbands.[36] Under Chinese marriage laws, husbands get to keep the marital home after divorce while their wives are entitled to compensation for the amount contributed to down payment or mortgage payment of such property.[37] In reality, very few women keep written records of monies contributed to purchase of marital homes, and thus will be hard-pressed to prove their share to the marital homes in court.[38] Second, even after the marital home has been conveyed from husband to wife pursuant to a divorce settlement, creditors may enforce against such community property.[39] This latter aspect is discussed in the next section.

Community debt under Chinese marriage law

While traditional Chinese marriage celebrates the joyous union of man and woman, this union also binds spouses together in debt in the event the marriage deteriorates. Under Chinese marriage laws, one spouse may be liable for the other spouse’s personal debt. Under the 2001 Marriage Law, the debt of either spouse shall be cleared off by the individual property of the debtor subject to two conditions.[40] First, the husband and wife have agreed to individually own their property. Second, if the creditor has knowledge of the said agreement.

However, there were various problems in the application of the 2001 Marriage Law, one of which was the prevalence of spouses undergoing “fake divorces” to evade debt obligations.[41] To address this specific problem, the Supreme People’s Court issued the Interpretation of the Supreme People’s Court about Several Problems Concerning the Application of the Marriage Law of the People’s Republic of China (II) in 2003 (“2003 Judicial Interpretation”).[42] Article 24 of the 2003 Judicial Interpretation (“Article 24”) provided that a debt incurred in one spouse’s name during marriage is generally treated as a joint debt of the husband and wife.[43] To rebut this presumption, the non-debtor spouse had to prove two points. First, the debt was clearly stipulated as a personal debt between creditor and debtor. Second, the husband and wife had agreed to individually own their property and the creditor knew of such agreement.[44] The wording of Article 24 was designed to prevent spouses from colluding to evade debt obligations, by specifying the standard for proving a community debt.[45]

However, Article 24 operated harshly against non-debtor spouses, particularly from 2014 to 2016. It became apparent during these years that there were a large number of court decisions in which the non-debtor spouse was found liable for a joint debt.[46] Typically in these cases, a non-debtor spouse was unaware of a debt incurred by the other spouse until the creditor sought to enforce against her property.[47] These decisions generated discussion on social media, particularly among wives who were compelled to pay off their husband’s debts in court.[48] One Ms. Wang posted an article on Sina Weibo titled “Marrying has its risks, take care in obtaining your marriage certificate”, in which she recounted her experience as a non-debtor spouse, and called on Article 24 to be repealed.[49] State-run media such as The People’s Daily Online also reported public dissatisfaction with Article 24.[50]

Meanwhile, practitioners highlighted the detrimental effects of Article 24 on non-debtor spouses. Chinese lawyer Shi Fu Long commented in an article published in 2018 that “Article 24 allowed individuals to borrow recklessly, then pull their oblivious spouses underwater with them”.[51] An article published by the People’s Court daily newspaper in 2019 further reported that wives often faced claims over debts incurred by their spouse, due to their weaker financial position in a marriage.[52] It was even reported that thousands of letters were sent to the Legislative Affairs Commission of the Standing Committee of the National People’s Congress, urging a review of Article 24.[53] These letters drew attention to the plight of non-debtor spouses.[54] In June 2017, members of the Legislative Affairs Commission and the National People’s Congress met to discuss issues related to Article 24.[55]

2017 and 2018 marked turning points for non-debtor spouses. Article 24 was amended to include an additional provision prohibiting claims over debts fabricated by one spouse in collusion with the creditor, and gambling debts incurred by one spouse. This addition was intended to address malicious and fabricated debt claims that burdened non-debtor spouses.[56] This amendment was made pursuant to the issuance of the Interpretation on Several Issues Concerning the Application of the Marriage Law of the People’s Republic of China (II) (2017 Amendment) (“2017 Interpretation on Marriage Law”).[57]

In addition, the burden of proving a community debt was reallocated from the debtor to the creditor, through the issuance of the Interpretation of the Supreme People’s Court on Issues concerning the Application of Law in the Trial of Cases Involving Marital Debt Disputes was issued on 16 January 2018 (“2018 Interpretation on Marital Debt Disputes”).[58] The burden of proof now falls on the creditor to demonstrate that debts incurred in the name of one spouse was a community debt. To do so, the creditor must prove that such debt is used to meet the joint needs of life or production or operation of husband and wife.[59] Alternatively, the creditor must prove that the debt based on the husband and wife’s common declaration of will,[60] for example through the joint signatures of husband and wife.[61] This amendment was intended to address the problem of unwary spouses being burdened by debts incurred by the other spouse.[62]

Since 2021, marriage laws were consolidated in Book Five of the Civil Code of the People’s Republic of China (the “Civil Code”).[63] The definition of community property in the Civil Code[64] is materially the same as that in the 2018 Interpretation on Marital Debt Disputes. There are two categories of community debt in the Civil Code. First, debts incurred according to the common expression of intent of both spouses, such as a debt jointly signed by both spouses. Second, debts incurred by one of the spouses in his own name during the marriage to meet the daily needs of the family.

Under the Civil Code, the burden of proving a joint debt lies with the creditor. The court will not support claims regarding debts fabricated by one spouse in collusion with the creditor, and gambling debts incurred by one spouse. In this regard, Article 34[65] and Article 33[66] of the Interpretation (I) of the Supreme People’s Court on the Application of the “Marriage and Family” Book of the Civil Code of the People’s Republic of China (“the 2020 Interpretation on the Civil Code”) replaced, in materially the same terms, the provisions in the 2017 Interpretation on Marriage Law and the 2018 Interpretation on Marital Debt Disputes.[67]

Section II – Issues in enforcement against community debt

Finding of joint debt liability against non-debtor spouse

In theory, the enactment of Article 1064 of the Civil Code makes it more challenging for creditors to prove a joint debt, and to enforce against property belonging to the non-debtor spouse. In practice, however, it is difficult to gauge the tangible effects of such legal developments. There is a lack of complete statistics showing the proportion of cases in which non-debtor spouses were found liable for joint debts, over the past 5 years.

From 2018 to 2019 when the 2017 Interpretation on Marriage Law and the 2018 Interpretation on Marital Debt Disputes were still in effect, a survey of court decisions in Openlaw showed a holding of joint debt in 93.39% of cases, compared to a holding of personal debt in 6.61% of cases.[68] No survey results were available from the year 2020 onwards. Based on a sampling of cases in China Judgment Online in 2022, the figures in 2018 and 2019 have changed.[69] In April 2022, the court held in 5 of 8 cases (62.5%) that there was a joint debt.[70] Based on the court’s decisions in publicly available cases, one may tentatively suggest that developments in Chinese marriage laws from 2017 onwards have improved the position of non-debtor spouses. However, these cases in April 2022 demonstrate that it is still possible for creditors to enforce debts against the non-debtor spouse.

In addition, academics and practitioners have highlighted issues within the marital debt framework. An article published by the People’s Court Daily in March 2022 acknowledged how execution against joint-owned property may impact the lives of the non-debtor spouse and her family members, if joint-owned property is used as a residential home.[71] This article suggests that such issues remain live in practice, and that the Supreme People’s Court is considering possible legal reforms in future.[72]

Hidden gender prejudice within Article 1064 of the Civil Code

While the language of Article 1064 of the Civil Code is gender-neutral, the operation of Article 1064 prejudices wives more than husbands.[73] This is due to family structures in which wives assume more household responsibility while earning less income than her husband[74] and having less participation in the labour force.[75] This also means that husbands are more likely to incur personal debts in the course of business and be embroiled in legal disputes.

Over the past five years, husbands consistently form the majority of borrowing spouses. In a survey conducted on Chinese judgments in 2017, out of 70 judgments involving joint marital debt, 61 judgments involved a male borrowing spouse.[76] In a similar survey conducted in 2018, out of 70 judgments involving joint marital debt, 60 judgments involved a male borrowing spouse.[77] In a survey of marital dispute cases heard in the Beijing No. 1 Intermediate People’s Court in 2019, 73% of debtor spouses were male.[78] This trend has continued after the Civil Code took effect in 2021. In a sampling of 8 cases in April 2022 on China Judgment Onlines, 7 involved a husband as the borrowing spouse, among which the court held there was a joint debt in 4 of these cases.[79] The upshot of these judgments is that wives are more likely to be jointly liable for personal debts incurred by their husbands, than the other way around.

Gender prejudice towards non-debtor wives is demonstrated in the sampled cases. In one of these cases, the husband managed a shrimp-rearing business and incurred a debt for the purchase of shrimp feed.[80] The wife claimed she had no knowledge of such debt. The court ruled that the wife was jointly liable for the husband’s personal debt, upon the husband’s passing. The court found that the husband’s business was the source of income for the spouses’ family, and the debt was incurred during the spouses’ marriage. Hence what began as a personal debt was eventually imposed on the wife as a joint marital debt upon the death of her husband.

Despite being couched in gender-neutral terms, Article 1064 of the Civil Code penalises wives more so than husbands in community debt disputes, due to the prevalence of husbands as borrowing spouses. Personal debts incurred by husbands can be transmitted to their spouses through Article 1064, even if the latter were unaware or did not agree to the incurrence of debt in the first place.

Obstacles to creditor enforcement

On the other hand, the marital property regime under the Civil Code can be abused by spouses, who prevent creditors from enforcing judgments. Debtor spouses may hide property or transfer property to third parties, making it difficult for creditors to trace the whereabouts of such property.

The possibility of such misconduct has been acknowledged by the Supreme People’s Court[81] and through the enactment of criminal legislation. Collusion to evade debt obligations attracts sanctions under Chinese Criminal Law.[82] On 3 December 2020, a debtor husband was prosecuted for transferring property to his wife and child through a divorce agreement, to evade creditor enforcement.[83] The husband was found guilty of the offence of refusal to enforce the judgment. He was sentenced to a one-year imprisonment term. This case is but one of many in which the debtor was charged for evasion of debt obligations.[84] These cases suggest that debt evasion is prevalent in practice.[85]

However, there is a safeguard for creditors in the event the debtor transfers property to the non-debtor spouse. Creditors can invoke Article 35 of the 2020 Interpretation on the Civil Code to enforce against community property owned by the debtor spouse and non-debtor spouse, as long as the creditor can prove that a community debt is involved.[86] In practice, the court has referred to Article 35 and held that the creditor was not bound by a divorce agreement between debtor spouse and non-debtor spouse, regarding transfer of properties and apportionment of debt liability.[87]

Hence, while there are obstacles towards creditor enforcement, these issues are addressed through penalties imposed on evasive debtors under the Chinese Criminal Law, as well as statutory safeguards under the 2020 Interpretation on the Civil Code to allow enforcement against community property transferred between spouses.

Scope for refinement of Civil Code

While legal developments appear to improve the position of non-debtor spouses and safeguard rights of creditor enforcement, there is scope for further legal refinement based on recent academic views and court decisions. Non-debtor spouses continue to face the prospect of losing their homes over personal debts incurred by their spouses.

To address this issue, it is useful to examine the ways in which other jurisdictions tackle issues in debt enforcement as Chinese academics sometimes refer to marriage laws in foreign jurisdictions[88] while Chinese laws have incorporated elements of foreign laws including the common law system.[89] The following section looks at the position in civil law jurisdictions including France, Germany and Taiwan, US community property states, and common law jurisdictions including UK and Singapore.

Section III – Issues in debt enforcement in other jurisdictions

Position in civil law jurisdictions

As China is a civil law jurisdiction, a useful starting point for comparison would be other civil law jurisdictions. In Taiwan, spouses have the liberty to decide how to own property during marriage, just like in the mainland. Under the Taiwan Civil Code,[90] spouses may sign a pre-nuptial or post-nuptial agreement entering into either a community property regime or separate property regime. If there is no such agreement, then the statutory mixed property regime applies. Under this mixed property regime property, property acquired before marriage belongs to one spouse, while property acquired after marriage belongs jointly to both spouses.[91]

However, there is an added mechanism for non-debtor spouses under the Taiwan Civil Code, in which the non-debtor spouse can seek compensation from the debtor spouse, if she discharges his personal debts from her own separate property (补偿请求权).[92] In this regard, there is no equivalent provision under the Civil Code. A Chinese academic has commented that this compensation system can be adopted in China.[93] This approach may address the unfairness towards imposing liability on non-debtor spouses.

In France, the scope of enforcement against non-debtor spouses is limited under the French Civil Code.[94] Spouses are jointly and severally liable only for contracts made for the support of the household or the education of children.[95] Beyond this, joint and several liability does not arise as regards expenditures that are manifestly excessive with reference to the way of living of the household.[96] Moreover, non-debtor spouses are not liable for personal loans incurred by debtor spouses, unless there was express consent between spouses.[97]

In Germany, debtor spouses are generally responsible for paying off their own debts. Under the German Civil Code,[98] neither the husband nor wife’s assets become the spouses’ joint property.[99] Non-debtor spouses are liable for debts incurred by the debtor spouse, only in the exceptional situation where the latter spouse become liable through commitments entered into to ensure that daily needs of the family are covered.[100]

Based on statutory language in these civil law jurisdictions, it is more difficult for non-debtor spouses to become jointly liable for a debt incurred by the debtor spouse, as compared to the position under the Civil Code. Apart from these civil law jurisdictions, further comparison can be made to US states with a community property regime.

Position in US community property states[101]

Similar to the position under the Civil Code, community property is subject to creditor enforcement under legislation in US community property states. In the California Family Code, the community estate is liable for a debt incurred by either spouse before or during marriage, regardless of whether one or both spouses are parties to the debt.[102] In the Arizona Revised Statutes Title 25, the community property is liable for the premarital separate debts or other liabilities of a spouse.[103]

In practice, courts in US community property states have imposed joint liability on spouses for personal debts incurred by one spouse. In Texas, an appeals court held that the husband and wife were jointly liable for unpaid legal fees incurred by the wife during her divorce proceedings.[104] Meanwhile, the Louisiana Supreme Court has held that the entire community property between husband and wife can be used to pay off the husband’s pre-marital debt.[105]

Nonetheless, these community property states have adopted homestead exceptions to limit or prohibit enforcement against residential property owned by non-debtor spouses.[106] Homeowners in these states can protect some equity in their residential home. The quantum of equity protected varies in each state. Such protected equity is immune from creditor enforcement and bankruptcy proceedings. Hence, the non-debtor spouse’s proprietary interest is better protected in US community property states, as compared to the position under the Civil Code.

A final comparison can be made to common law jurisdictions. Although the marital property regime in common law jurisdictions and in China are different, Chinese academics have proposed solutions to issues in enforcement proceedings, and these solutions feature in common law jurisdictions.[107] Thus, the common law jurisdictions may be a further source of inspiration for legal reform.

Position in common law jurisdictions

The rights of non-debtor spouses are protected in three ways in common law jurisdictions. First, in the UK, spouses hold property separately[108] and are liable for their respective debts.[109] The same position applies in Singapore.[110] Second, there is a variant of the homestead exception in Singapore. Public housing is exempt from execution by judgment creditors, unlike private housing.[111] The rationale behind this exemption is to ensure residents have a roof over their heads.[112] Third, when creditors enforce debt against property jointly owned by debtor spouse and non-debtor spouse, creditors are only permitted to seize the debtor’s share in such property, leaving the non-debtor’s share intact. Upon enforcement, the property will be divided and sold off to satisfy the debt and to reimburse the non-debtor spouse.[113]

The above approach strikes a balance between the rights of creditors and non-debtor spouses. In common law jurisdictions, creditors can enforce against property even if it is held in joint names by the debtor and his non-debtor spouse.[114] However, creditor enforcement is limited to the debtor’s share in property. The non-debtor’s share in property cannot be seized. Hence, while the non-debtor spouse may lose her residential home during enforcement, she will at least be compensated financially and can look for alternative housing.

Section IV – Improvements to present laws

Despite recent reforms to Chinese Marriage Laws, creditor enforcement may still operate harshly against non-debtor spouses. In this regard, the above-mentioned jurisdictions have developed mechanisms to limit debt enforcement against non-debtor spouses. Each of these solutions can potentially be adopted under the Civil Code.

The first solution is to incorporate the modified homestead exemption in Singapore, into the Civil Code. In China, the government provides “affordable housing” for less affluent families.[115] In theory, a homestead exemption can be applied to non-debtor spouses residing in “affordable housing”. This exemption will allow non-debtor spouses to retain their home in the event of enforcement.

In practice however, debtors have abused the homestead exemption to frustrate creditor claims. Debtors in the US have intentionally acquired properties in states with liberal homestead exemptions, to evade creditor enforcement. For example, in the wake of the Enron scandal, former Enron CEO sold off property in Colorado and held onto property in Texas.[116] Debtors may also intentionally and exclusively own public housing to evade enforcement, although this has not been officially reported in Singapore yet. Hence, the homestead exemption may be applied too liberally to the creditors’ detriment.

The second solution is to allow the non-debtor spouse to seek compensation for repayment of the other spouse’s debts, similar to the mechanism under Article 1038 of the Taiwan Civil Code. However, this approach may be problematic if the debtor spouse absconds or lacks resources to compensate the non-debtor spouse. The non-debtor spouse may be unable to enforce her rights of compensation. In addition, this approach may lead to satellite litigation in court over the original creditor-debtor claim. This may in turn burden the court system by prolonging court disputes.

The third solution is to restrict enforcement of the debtor’s share of property, as in common law jurisdictions. In other words, the non-debtor should retain her share of property during enforcement proceedings through reimbursement of sale proceeds. At present, Article 12 of the Provisions of the Supreme People’s Court for the People’s Court to Seal Up, Distrain and Freeze Properties in Civil Enforcement (2020 Amendment) (“Article 12”) already allows the court to give effect to an arrangement by joint owners to divide their property, subject to creditor’s agreement.[117]

In practice however, it may be difficult for the joint owners to obtain the creditor’s consent to divide up property, or to demonstrate proof of such consent. The courts may also be wary of attempts to evade debt obligations through property transfers under divorce agreements, and thereby decline to give effect to such agreements in enforcement proceedings. This is illustrated in a 2022 decision.[118] The creditor successfully sued the debtor husband under a financing agreement and enforced the judgment against the non-debtor wife’s immovable property. The wife resisted enforcement by arguing that the property was transferred to her under a divorce agreement. The creditor asserted that spouses had colluded to prevent debt enforcement by transferring property. The court held there was insufficient evidence to show that the creditor had consented to the division of property under the divorce agreement. Hence the terms of the divorce agreement did not bind the creditor.

In contrast, courts in the UK are empowered to divide property during enforcement proceedings, even if the creditor does not agree on division. The practice of the UK Courts is to allow a charging order to attach against a jointly owned property, so long as the creditor can show that the debtor has a beneficial interest in that property.[119] The precise extent of beneficial interest need not be ascertained until the creditor applies for a court order to sell off the property.[120] In deciding whether to order a sale of property, the UK courts must consider factors such as the quantum of judgment debt and whether the judgment debtor has infant children.[121]

The present framework under Article 12 is too rigid as it requires creditor’s consent before the court can give effect to an agreement to divide property. Creditor’s consent may not be forthcoming when parties are in the heat of a dispute. The UK approach in enforcement proceedings accords more flexibility and can be adopted in the Civil Code. The courts should be accorded discretion in ascertaining the non-debtor’s share in property and ordering a sale of such property to satisfy judgment debts. This approach would strike a balance between the rights of the creditor and non-debtor spouse. It allows the creditors to recover the debt at least in part, while financially compensating the non-debtor spouse.

Conclusion

Although certain traditional beliefs and practices have been abolished in modern society, the saying that “a wife pays for her husband’s debts” still holds true in modern China. Judicial application of Chinese marriage laws has resulted in unfair outcomes for non-debtor spouses, who are usually wives. In some cases, the wife ends up facing a mountain of debt while the husband absconds from creditor claims.

In other jurisdictions, there are legal mechanisms that protect the interests of non-debtor spouses. However, not all these legal mechanisms can be incorporated wholesale into Chinese laws. In this regard, this article proposes following the UK approach in enforcement proceedings. The Chinese courts should be accorded discretion in dividing property up during enforcement proceedings, by considering factors such as the interests of family members living within that property.[122] This approach would protect the non-debtor spouse’s share of property, while preserving the creditor’s right of enforcement. It is hoped that this proposal would equalize the position of creditors and non-debtor spouses in civil litigation.

ANNEX 1

Date of decision Citation Holding
1 April 2022 (2022)苏04民终372号 Debt was a joint debt.

The debt (200,000 RMB loan) was incurred in the course of the debtor husband’s business. The non-debtor wife benefited from the profits of her husband’s business during marriage.

6 April 2022 (2022)鲁03民终1074号 Debt was not a joint debt.

The debt was incurred by the husband. The creditor failed to prove that the debt was incurred according to the common expression of intent of both spouses, or incurred during the marriage to meet the daily needs of the family.

7 April 2022 (2022)鲁03民终1075号 Debt was not a joint debt.

The debt was incurred by the husband.

The creditor failed to prove that the debt was incurred according to the common expression of intent of both spouses, or incurred during the marriage to meet the daily needs of the family. The debt quantum of 250,000 RMB was in excess of the daily needs of the family.

12 April 2022 (2022)湘09民终559号 Debt was a joint debt.

The non-debtor spouse could not prove that she had no knowledge of the debt incurred by her husband. Creditor should be allowed to enforce the debt against the non-debtor spouse, upon the passing of the debtor spouse.

15 April 2022 (2021)辽08民终3635号 Debt was not a joint debt.

The debt was incurred by the husband. The non-debtor spouse did not sign on the loan agreement. The debt was not used to meet the daily needs of the family.

19 April 2022 (2022)京01民终1420号 Debt was a joint debt.

The debtor spouse (wife) had borrowed 50,000 RMB from the creditor, and transferred the said amount to the non-debtor spouse.

 

21 April 2022 (2022)湘06民终844号 Debt was a joint debt.

The debtor spouse (husband) took out a loan from the creditor in the course of the debtor’s business. The debtor failed to repay the loan. The non-debtor spouse was jointly liable for the debt since she had also participated in the business activities of her husband.

24 April 2022 (2022)鲁14民终1021号 Debt was a joint debt.

The debt was incurred by the husband. Even though the wife did not sign on the loan agreement, she had benefited from the loan together with her husband.

ANNEX 2

US State Statutory provision on community property and community debt Statutory provision on homestead exception
Arizona ARIZ. REV. STAT. ANN.

§ 25-215

ARIZ. REV. STAT. ANN.

§ 33-1101

California CAL. FAM. CODE § 910(a) Code of Civil Procedure

§ 704.730

Idaho Idaho Code 32-906 Idaho Code 55-1001, 1003
Louisiana Louisiana Civil Code,

Article 2345

2011 Louisiana Laws Revised Statutes Title 20
Nevada Nevada Revised Statutes Chapter 123.050 Nevada Revised Statutes Chapter 115.010
New Mexico New Mexico Statutes,

Section 40-3-8

New Mexico Statutes,

Section 42-10-9

Texas Texas Family Code,

§ 3.002 and § 3.201

Texas Property Code § 41.002
Washington Revised Code of Washington

26.16.030

Revised Code of Washington

6.13.030

Wisconsin Wisconsin Code,

Chapter 766

Wisconsin Code,

Chapter 815.18

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  4. See John L. McCreery, Women’s Property Rights and Dowry in China and South Asia, Ethnology , Apr., 1976, Vol. 15, No. 2 (Apr., 1976), pages 168 to 169. The author mentions that the bride’s trousseau, consisting of clothing and jewelry was considered her personal property. However, land or other property provided as a dowry was given not to the bride herself, but instead to the branch of her husband’s family composed of herself, her husband and their descendants.
  5. Ma Jin (马瑾) and Li Zhao Fu (李兆福), (夫妻与亲子:中西方文化家庭伦理观比较研究)[Husband- wife and parent-child: comparative study on ethical concepts of families between Chinese and Western cultures], 17 March 2017, available at https://xb.sut.edu.cn/sk/fileup/HTML/2017-3-278.shtml (last accessed on 27 July 2022).
  6. Cheng An Ying (程安营), (从该案看日常生活经验法则的适用) [Analysing the application of empirical rules in daily life through case study], 6 November 2009, available at http://www.hncourt.gov.cn/public/detail.php?id=91107 (last accessed on 27 July 2022).
  7. Liu Yin Qiu (刘吟秋),离婚夫妻之间未举债被负债,女方占比73% [During divorce, spouses are liable for debts they did not incur. Women comprise 73% of non-debtor spouses.], article published in the People’s Court Daily newspaper on 26 March 2019, available at http://rmfyb.chinacourt.org/paper/html/2019-03/26/content_153413.htm?div=-1 (last accessed on 27 July 2022). This article mentions that in a survey of marital dispute cases heard in the Beijing No. 1 Intermediate People’s Court, 30% of these cases involved one spouse requesting the other spouse to bear joint liability for debts incurred by the former spouse. Within these cases, 73% of debtor spouses were male.See also Section I of this article, which discusses public reaction towards Chinese marriage laws regarding detriment towards wives as non-debtor spouses.
  8. Chinese public demands revision of marriage law to protect women, article published by the People’s Daily Online on 17 November 2016, available at https://www.chinadaily.com.cn/china/2016-11/17/content_27402671.htm (last accessed on 27 July 2022).
  9. Littlejohn, Lauren J., Confucianism: How Analects Promoted Patriarchy and Influenced the Subordination of Women in East Asia” (2017), Young Historians Conference 2017, available at https://pdxscholar.library.pdx.edu/cgi/viewcontent.cgi?article=1120&context=younghistorians (last accessed on 27 July 2022). The author mentions that “Confucianism created a patriarchal society where women were powerless against their husbands and fathers, were not allowed to participate in public life, and could not inherit property nor carry on the family name”.
  10. Ibid.
  11. Supra note 4.
  12. Supra note 9. The author mentions that “The Confucian gender distinction has influenced the modern day expectation for women to have children and stop working once they get married. Women’s domestic role fosters greater dependency on males, because women are confined to their homes and are reliant on the income of their husbands and fathers.”
  13. Margaret Kuo, Intolerable Cruelty, Marriage, Law and Society in Early Twentieth-Century China (2012), Chapter Two Republican Legal Exceptionalism, pages 27 and 28.
  14. Margaret Kuo, Intolerable Cruelty, Marriage, Law and Society in Early Twentieth-Century China (2012), Chapter Two Republican Legal Exceptionalism, pages 40 to 43.
  15. Zhong Hua Min Guo Min Fa Dian (中华民国民法典) [Republican Civil Code, 1929-1930], accessible at https://www.jus.org.cn/%E6%96%87%E4%BB%B6:%E6%B0%91%E6%B3%95%E7%AC%AC%E5%9B%9B%E7%BC%96_%E4%BA%B2%E5%B1%9E1.pdf (accessed on 27 July 2022).
  16. Supra note 15, Chapter IV Family Article 1016.
  17. Supra note 15, Chapter IV Family Article 1017.
  18. Margaret Kuo. The Construction of Gender in Modern Chinese Law: Discrepant Gender Meanings in the Republican Civil Code, Front. Hist. China, 2012, 7(2): 282‒309.
  19. The provisions of the Common Program of the Chinese People’s Political Consultative were passed on 29 September 1949. Article 17 of the Common Program abolished the laws passed by the Guomindang party, and provided that new laws will be enacted to replace the former laws. The provisions of the Common Program of the Chinese People’s Political Consultative are available at http://www.cppcc.gov.cn/2011/12/16/ARTI1513309181327976.shtml (last accessed on 27 July 2022).
  20. Zhong Hua Ren Min Gong He Guo Hun Yin Fa (中华人民共和国婚姻法) [Marriage Law of the People’s Republic of China] (promulgated by the Standing Committee of the National People’s Congress, effective 1 May 1950).
  21. Supra note 20, article 12.
  22. Supra note 20, article 10.
  23. Supra note 20, article 23.
  24. Yang Yan Ke (杨琰珂)and Jing Hong Qin (荆红琴),从夫妻财产制度发展看中国法治进步 [Viewing improvements in China’s rule of law through developments in the marital debt system], article published in the People’s Court Daily newspaper on 12 June 2019, available at http://rmfyb.chinacourt.org/paper/html/2019-06/12/content_156382.htm?div=-1#:~:text=1950%E5%B9%B4%E3%80%8A%E4%B8%AD%E5%8D%8E%E4%BA%BA%E6%B0%91%E5%85%B1%E5%92%8C%E5%9B%BD,%E7%BA%B3%E5%85%A5%E5%85%B1%E6%9C%89%E8%B4%A2%E4%BA%A7%E7%9A%84%E8%8C%83%E5%9B%B4%E3%80%82 (last accessed on 27 July 2022).
  25. Watson, Rubie S., and Patricia Buckley Ebrey, Marriage and Inequality in Chinese Society. Berkeley:  University of California Press (1991), Chapter 10 Women, Property and Law in the People’s Republic of China, available at http://ark.cdlib.org/ark:/13030/ft6p3007p1/ (last accessed on 27 July 2022).
  26. Supra note 24.
  27. Zhong Hua Ren Min Gong He Guo Hun Yin Fa (中华人民共和国婚姻法) [Marriage Law of the People’s Republic of China] (promulgated by the Standing Committee of the National People’s Congress, effective 1 January 1981), Article 13. Article 13 provides that “The property acquired by the husband and the wife during the period in which they are under contract of marriage shall be in their joint possession, unless they have agreed otherwise. Husband and wife shall enjoy equal rights in the disposition of their jointly possessed property.”
  28. Zhong Hua Ren Min Gong He Guo Hun Yin Fa Shi Yi Ji Shi Yong Zhi Nan《中华人民共和国婚姻法》释义及实用指南 [Guidelines for the interpretation and application of the Marriage Laws of the People’s Republic of China], interpretation of Article 17 of the 2001 Marriage Law, available at http://www.faxin.cn/LibraryInter/TwsyContent.aspx?gid=A191379&tiao=17&code=1JwPdCKz5/Dd67GhiQsf9w1LNEMMaYQVayM02PyPSwU= (last accessed on 27 July 2022). These guidelines explain the background behind the amendments to the 1950 Marriage Law in 1980.
  29. See Zui Gao Ren Min Fa Yuan Guan Yu Ren Min Fa Yuan Shen Li Li Hun An Jian Chu Li Cai Chan Fen Ge Wen Ti De Ruo Gan Ju Ti Yi Jian 《最高人民法院关于人民法院审理离婚案件处理财产分割问题的若干具体意见》[Several Specific Opinions of the Supreme People’s Court on the Handling of Property Division Issues by the People’s Courts in the Trial of Divorce Cases] (adopted by the Adjudication Committee of the Supreme People’s Court). This opinion distinguished between “family common property” and “joint marital property”. Under Article 2 of this opinion, “joint marital property” refers to the property acquired by both husband and wife during the existence of the marital relationship.
  30. Supra note 28.
  31. Zhong Hua Ren Min Gong He Guo Hun Yin Fa (2001 Xiu Zheng) (中华人民共和国婚姻法(2001修正)) [Marriage Law of the People’s Republic of China (2001 Amendment)] (amended by the Standing Committee of the National People’s Congress, effective 28 April 2001).
  32. Supra note 31, article 17. Article 17 provides that “The following properties incurred during the existence of marriage shall be jointly owned by both husband and wife:
    a. wages and bonuses; b. any income incurred from production or management; c. any income incurred from intellectual property; d. any property inherited or bestowed, with the exception of those as mentioned in Article 18 (c) of this law; e. other property that shall be jointly owned. Both husband and wife shall have equal rights in the disposal of jointly owned property
    .”
  33. Supra note 31, article 18. Article 18 provides that “The following property shall be owned by either the husband or the wife: a. the pre-marital property that is owned by one party; b. the payment for medical treatment or living subsidies for the disabled arising from bodily injury on either party; c. the articles of living specially used by either party; d. other property that shall be used by either party.”
  34. Deborah S. Davis, On the Limits of Personal Autonomy: PRC Law and the Institution of Marriage in Wives, Husbands, and Lovers: Marriage and Sexuality in Hong Kong, Taiwan, and Urban China (2014), edited by Deborah S. Davis and Sara L. Friedman, pages 41 to 61.
  35. Supra note 28.
  36. A 2012 Horizon Research and iFeng.com survey of thousands of home buyers in Beijing, Shanghai, Guangzhou, and Shenzhen found that men’s names are on the property deeds of 80% of marital homes, but women’s names are included on the deeds of only 30% of marital homes. See the article titled Mei Mei: Zhong Guo Fang Di Chan Fan Rong Tu Xian Xing Bie Bu Ping Deng Wen Ti, 美媒:中国房地产繁荣 凸显性别不平等问题 [US media: China’s real estate boom reveals gender inequality issues] published by 凤凰网 (ifeng.com) on 4 May 2014, available at https://house.ifeng.com/news/2014_05_04-46136484_0.shtml (last accessed on 27 July 2022). See also Leta Hong Fincher, Leftover Women: The Resurgence of Gender Inequality in China (2014) at page 46.
  37. Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong Zhong Hua Ren Min Gong He Guo Min Fa Dian Hun Yin Jia Ting Bian De Jie Shi (Yi) 最高人民法院关于《中华人民共和国民法典》婚姻家庭编的解释(一) [Interpretation (I) of the Supreme People’s Court on the Application of the “Marriage and Family” Book of the Civil Code of the People’s Republic of China] (promulgated by the Judicial Committee of the Supreme People’s Court, effective 1 January 2021), article 78. Article 78 provides that “Where, before marriage, one spouse signs a real estate purchase contract, makes a down payment with his or her separate property and gets a loan from a bank, if, after marriage, the spouse repays the loan with community property and the real estate is registered under the name of the down payment payer, such real estate shall be disposed of by both parties upon agreement at the time of divorce.Where no agreement is reached in accordance with the preceding paragraph, the people’s court may render a judgment that such real estate should belong to the party under whose name the real estate is registered, and the outstanding loans shall be the personal debt of the aforesaid party. For the money jointly paid by both parties after marriage to repay the loan and the corresponding property appreciation, the party under whose name the real estate is registered shall compensate the other party at the time of divorce under the principles prescribed in paragraph 1 of Article 1087 of the Civil Code.”
  38. See Leta Hong Fincher, Leftover Women: The Resurgence of Gender Inequality in China (2014), pages 47 and 48.
  39. Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong Zhong Hua Ren Min Gong He Guo Min Fa Dian Hun Yin Jia Ting Bian De Jie Shi (Yi) 最高人民法院关于《中华人民共和国民法典》婚姻家庭编的解释(一) [Interpretation (I) of the Supreme People’s Court on the Application of the “Marriage and Family” Book of the Civil Code of the People’s Republic of China] (promulgated by the Judicial Committee of the Supreme People’s Court, effective 1 January 2021), article 35. Article 35 provides that “Where the divorce agreement of the parties or the effective judgment, ruling, or mediation decision of the people’s court has dealt with the partition of marital property, the creditor shall still have the right to file a claim against both parties for their community debt.”
  40. Supra note 31, article 19. Article 19 provides that “Husband and wife may come to an agreement whether the property incurred during the existence of marriage or prior to marriage to be owned by each party, to be jointly owned or partially owned by each party and partially owned by both parties. The agreement shall be made in written form. Where there is no such agreement or it is not explicitly agreed upon, the provisions of articles 17 and 18 shall apply. The agreement concerning the property obtained during the existence of marriage and pre-marital property shall be binding upon either party. Where husband and wife agree to individually own their property, the debt of either the husband or the wife shall be cleared off by the individual property of the debtor if the creditor has the knowledge of the said agreement.”
  41. This issue was raised during a press conference regarding the issuance of the Interpretation of the Supreme People’s Court on Issues concerning the Application of Law in the Trial of Cases Involving Marital Debt Disputes. During the press briefing, the director of the 1st Civil Division of the Supreme People’s Court, Cheng Xin Wen, explained the legislative intent behind Article 24. He mentioned that there were cases where spouses chose to divorce to evade enforcement. Article 24 was meant to address these occurrences, by creating a presumption of joint debt.See the article titled Zui Gao Fa Chu Tai Si Fa Jie Shi Ming Que Fu Qi Gong Tong Zhai Wu Ren Ding Biao Zhun, 最高法出台司法解释明确夫妻共同债务认定标准 [Supreme People’s Court issues judicial interpretation to clarify the standard of joint marital debt] published by the Supreme People’s Court on 17 January 2018, available at https://www.court.gov.cn/zixun-xiangqing-77372.html (last accessed on 27 July 2022).
  42. Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong (Zhong Hua Ren Min Gong He Guo Hun Yin Fa) Ruo Gan Wen Ti De Jie Shi (Er))最高人民法院关于适用《中华人民共和国婚姻法》若干问题的解释(二)[Interpretation of the Supreme People’s Court about Several Problems Concerning the Application of the Marriage Law of the People’s Republic of China (II)], (promulgated by the Judicial Committee of the Supreme People’s Court, effective 1 April 2004).
  43. Supra note 42, article 24. Article 24 provides that “During the existence of the marriage, if either the husband or wife files a claim for a personal debt in the name of one party, the debt shall be treated as a joint debt of the husband and wife, unless either the husband or wife is able to prove that the creditor and the debtor have clearly stipulated it as a personal debt or to show that the debt is under any of the circumstance as prescribed in the third paragraph of Article 19 of the Marriage Law.”
  44. Supra note 42, article 24.See also (Guan Yu Shi Yong Hun Yin Fa Ruo Gan Wen Ti De Jie Shi (Er)) De Li Jie Yu Shi Yong《关于适用婚姻法若干问题的解释(二)》的理解与适用 [Interpretation and application of the 2003 Judicial Interpretation].
  45. Supra note 41.
  46. See the article titled “婚姻法司法解释第24条引争议离婚“被负债”纠纷频发” [Controversies regarding Article 24 of the Judicial Interpretation to Marriage Law, divorced and in debt], published on 17 January 2017, available at http://www.xinhuanet.com//2017-01/17/c_1120323551_2.htm (last accessed on 27 July 2022). This article mentions that the loophole in Article 24 became more obvious in recent years. The article cites statistics from China Judgment Online to show that there were over 70,000 cases each year in 2014 and 2015, in which there was a finding of joint debt liability for loan disputes. This figure increased to more than 120,000 cases in 2016. The article further mentions that the loophole in Article 24 became more apparent in recent years.
  47. In one case applying Article 24, the wife claimed that her husband had incurred a debt without her knowledge. The husband had allegedly purchased property for his mistress in an extra-marital affair. The husband failed to repay the debt, and the creditor executed against the residential property of the husband and wife. The court allowed enforcement even though the residential property was transferred to the wife pursuant to a divorce agreement. This case is cited as [(2016)苏03民终5013号], Xia Mou Mou. v. Ji Mou Mou, 29 December 2017 (Xuzhou City Intermediate People’s Court).
  48. A group named “24 条公益群寒冰” [Article 24 Public Welfare Group] was set up on Sino Weibo. Members of this group urged Article 24 to be amended and for spouses to be liable for their own debts. The webpage of this group is accessible at https://weibo.com/u/6190035301 (last accessed on 27 July 2022).
  49. The original article on Sina Weibo cannot be accessed as of 17 May 2022. However, an article published by the Chinese state news agency Xin Hua Wang refers to the original article on Sina Weibo. See the article titled “婚姻法司法解释第24条引争议离婚“被负债”纠纷频发” [Controversies regarding Article 24 of the Judicial Interpretation to Marriage Law, divorced and in debt], published on 17 January 2017, available at http://www.xinhuanet.com//2017-01/17/c_1120323551_2.htm (last accessed on 27 July 2022).
  50. Chinese public demands revision of marriage law to protect women, article published by the People’s Daily Online on 17 November 2016, available at https://www.chinadaily.com.cn/china/2016-11/17/content_27402671.htm (last accessed on 27 July 2022).
  51. Shi Fu Long, A long overdue legal change will save married Chinese from debt, 7 February 2018, available at https://www.sixthtone.com/news/1001670/a-long-overdue-legal-change-will-save-married-chinese-from-debt (last accessed on 27 July 2022).
  52. Supra note 7.
  53. Xing Bing Yin (邢丙银), 婚姻法司法解释二第24条修正背后:近千封信建议法工委审查 [The background behind amendment to Article 24 of the Judicial Interpretation of Marriage Law: thousands of letters with proposals were sent to the Legislative Affairs Commission], article published by The Paper on 22 January 2018, available at https://www.thepaper.cn/newsDetail_forward_1961044 (last accessed on 27 July 2022).
  54. Ibid.
  55. Supra note 53.
  56. Supra note 41. The director of the 1st Civil Division of the Supreme People’s Court, Cheng Xinwen, explained that Article 24 was amended to address malicious, illegal and fabricated debt claims which burdened non-debtor spouses.
  57. Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong (Zhong Hua Ren Min Gong He Guo Hun Yin Fa) Ruo Gan Wen Ti De Jie Shi (Er)) 最高人民法院关于适用《中华人民共和国婚姻法》若干问题的解释(二)(2017 修正)[Interpretation of the Supreme People’s Court about Several Problems Concerning the Application of the Marriage Law of the People’s Republic of China (II) (2017 Amendment)], (adopted by the Judicial Committee of the Supreme People’s Court, effective 3 January 2017).See also Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong (Zhong Hua Ren Min Gong He Guo Hun Yin Fa) Ruo Gan Wen Ti De Jie Shi (Er)) 最高人民法院关于适用《中华人民共和国婚姻法》若干问题的解释(二)的补充规定 [Supplementary Provisions on Interpretation (II) of the Supreme People’s Court on Several Issues Concerning the Application of the Marriage Law of the People’s Republic of China], (adopted by the Judicial Committee of the Supreme People’s Court on 20 February 2017), effective 1 March 2017). These supplementary provisions added the following two paragraphs to Article 24 of the 2017 Interpretation on Marriage Law: “If one of the husband and wife colludes with a third party, fictitious debts, and the third party claims rights, the people’s court shall not support it” and “The people’s court shall not support the claim of a third party’s claim for debts incurred by one spouse in engaging in illegal and criminal activities such as gambling and drug use”.
  58. Zui Gao Ren Min Fa Yuan Guan Yu Shen Li She Ji Fu Qi Zhai Wu Jiu Fen An Jian Shi Yong Fa Lv You Guan Wen Ti De Jie Shi《最高人民法院关于审理涉及夫妻债务纠纷案件适用法律有关问题的解释》[Interpretation of the Supreme People’s Court on Issues concerning the Application of Law in the Trial of Cases Involving Marital Debt Disputes], (promulgated by the Judicial Committee of the Supreme People’s Court, effective 18 January 2018).
  59. Supra note 58, Article 3. Article 3 provides that “Where one spouse incurs a debt in his or her own name during marriage beyond the needs of everyday life of his or her family, if the creditor files any claim on the ground that it is a community debt of husband and wife, the court shall not support the claim, unless the creditor is able to prove that the debt is used to meet the joint needs of life or production or operation of husband and wife or based on their common declaration of will.”
  60. Ibid.
  61. Supra note 58, Article 1. Article 1 provides that “Debts incurred by a common declaration of will such as the joint signatures of husband and wife or the subsequent ratification by the other spouse shall be determined as community debts of husband and wife.”
  62. Supra note 41. The director of the 1st Civil Division of the Supreme People’s Court, Cheng Xin Wen, acknowledged public dissatisfaction with Article 24 and its negative impact on non-debtor spouses.
  63. Zhong Hua Ren Min Gong He Guo Ming Fa Dian《中华人民共和国民法典》[ Civil Code of the People’s Republic of China] (promulgated by the National People’s Congress, effective 1 January 2021).
  64. Supra note 63, Article 1064. Article 1064 provides that “Debts incurred according to the common expression of intent of both spouses, such as a debt jointly signed by both spouses and a debt signed by one spouse and subsequently ratified by the other spouse, and debts incurred by one of the spouses in his own name during the marriage to meet the daily needs of the family, constitute community debts.
    A debt incurred by one of the spouses in his own name during the marriage in excess of the daily needs of the family is not a community debt, unless the creditor may prove that such debt is used for both spouses’ daily life or for joint production and operation of the spouses, or such debt incurs according to the common expression of intent of both spouses
    .”
  65. Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong Zhong Hua Ren Min Gong He Guo Min Fa Dian Hun Yin Jia Ting Bian De Jie Shi (Yi) 最高人民法院关于《中华人民共和国民法典》婚姻家庭编的解释(一) [Interpretation (I) of the Supreme People’s Court on the Application of the “Marriage and Family” Book of the Civil Code of the People’s Republic of China] (promulgated by the Judicial Committee of the Supreme People’s Court, effective 1 January 2021), article 33. Article 33 provides that “Where a creditor files a claim for the personal debt incurred by a party before marriage against his (her) spouse, the people’s court shall not support such a claim, unless the creditor can prove that the debt is used to meet the joint needs of life of husband and wife.”
  66. Supra note 65, article 34. Article 34 provides that “Where the husband or wife, in collusion with a third party, fabricates a debt, and the third party claims that the debt is community debt, the people’s court shall not support such a claim. Where the husband or wife bears any debt during illegal and criminal activities such as gambling and drug abuse, and a third party claims that the debt is a community debt, the people’s court shall not support such a claim.”
  67. See Zui Gao Ren Min Fa Yuan Guan Yu Fei Zhi Bu Fen Si Fa Jie Shi Ji Xiang Guan Gui Fan Xing Wen Jian De Jue Ding最高人民法院关于废止部分司法解释及相关规范性文件的决定 [Decision of the Supreme People’s Court to Repeal Some Judicial Interpretations and Relevant Regulatory Documents], issued by the Judicial Committee of the Supreme People’s Court, effective 1 January 2021), which repealed the 2017 Interpretation on Marriage Law and the 2018 Interpretation on Marital Debt Disputes.
  68. Xu Xue Qin (徐雪晴), Gong Wei(龚唯),为何有了“新解释”,纠错夫妻债务纠纷的历史遗案还那么难? [Why historical cases on marital debt disputes are problematic in spite of the new interpretation?], article published on The Paper on 29 March 2019, available at https://m.thepaper.cn/newsDetail_forward_3214161 (last accessed on 27 July 2022). The Paper is a Chinese digital newspaper run by the Shanghai United Media Group.
  69. A search was carried out in the web portal China Judgments Online on 12 May 2022, using the search terms “共同债务“, “《中华人民共和国民法典》第一千零六十四条”, “2022“. There were a total of 462 decisions in 2022 based on these search terms.
  70. See Annex 1 for breakdown of the holding of cases decided in April 2022.
  71. This point is discussed in an article published by the People’s Court Daily newspaper. See Wang Jun Xia (王军霞),夫妻共有房屋的执行困境与路径优化 [Difficulties in the enforcement of property jointly owned by spouses, and ways to improve the framework], article published on 3 March 2022, available at http://rmfyb.chinacourt.org/paper/images/2022-03/03/08/2022030308_pdf.pdf (last accessed on 27 July 2022). In this article, the author mentions that the enforcement against co-owned property may infringe the rights of the non-party to the debt.The author is a judicial clerk who works in the enforcement division of the Shanghai Intermediate People’s Court. The author’s expertise appears to be in enforcement of court judgments. The author’s designation is mentioned in the website of the Shanghai High People’s Court, available at http://www.hshfy.sh.cn/shfy/web/xxnr.jsp?pa=aaWQ9MjAyMTgxODQmeGg9MSZsbWRtPWxtNDYwz (last accessed on 27 July 2022).
  72. The People’s Court Daily is a daily newspaper managed and issued by the Supreme People’s Court. It mainly publishes articles written by judges from various courts across China. See the overview of the People’s Court Daily written by the China Justice Observer, available at https://www.chinajusticeobserver.com/t/people-s-court-daily (last accessed on 27 July 2022).
  73. Huang, J., Cheong, M.F., Marriage Transmitted Debt in the Chinese Civil Code: The Beginning of a Solution Rather than the End. Fem Leg Stud 30, 1–27 (2022).
  74. Huang, J., Cheong, M.F., Marriage Transmitted Debt in the Chinese Civil Code: The Beginning of a Solution Rather than the End. Fem Leg Stud 30, 1–27 (2022) at page 7.
  75. According to statistics from the World Bank, the ratio of female to male labour force participation rate from 1990 to 2020 has ranged from 81.5% to 86%. This means that males have consistently participated more in the labour force over the past 30 years. See article titled Ratio of female to male labour force participation rate (%) (modelled ILO estimate), published by the World Bank, available at https://data.worldbank.org/indicator/SL.TLF.CACT.FM.ZS?end=2020&locations=CN&start=1990 (last accessed on 27 July 2022).
  76. Huang, J., Cheong, M.F., Marriage Transmitted Debt in the Chinese Civil Code: The Beginning of a Solution Rather than the End. Fem Leg Stud 30, 1–27 (2022) at pages 11 and 12.
  77. Huang, J., Cheong, M.F., Marriage Transmitted Debt in the Chinese Civil Code: The Beginning of a Solution Rather than the End. Fem Leg Stud 30, 1–27 (2022) at page 19.
  78. Supra note 7.
  79. See Annex 1 for breakdown of the holding of cases decided in April 2022.
  80. Cao Xiu Yun. v. Wang Zhi Guang (sale contract dispute), 23 April 2022 (Yi Yang City Intermediate People’s Court), cited as (2022)湘09民终559号.
  81. Supra note 41.
  82. Zhong Hua Ren Min Gong He Guo Xing Fa(2020 Xiu Zheng)《中华人民共和国刑法(2020 修正)》[Criminal Law of the People’s Republic of China (2020 Amendment)] (promulgated by the Standing Committee of the National People’s Congress, effective 1 March 2021), Article 313. Article 313 provides that “Whoever refuses to execute a judgment or ruling rendered by a people’s court while he or she is able to do so shall be sentenced to imprisonment of not more than three years or limited incarceration or a fine if the circumstances are serious; or be sentenced to imprisonment of not less than three years but not more than seven years in addition to a fine if the circumstances are especially serious. Where an entity commits the crime as provided for in the preceding paragraph, a fine shall be imposed on it, and its directly responsible person in charge and other directly liable persons shall be punished in accordance with the provisions of the preceding paragraph.”
  83. Shen Mou Mou, evasion of enforcement through transfer of property under divorce agreement, (Zhang Jia Gang City People’s Court), 江苏省苏州市中级人民法院发布2021年度打击拒执犯罪十大典型案例之二:沈某某通过协议离婚转移财产被判处拒执罪案.
  84. See 最高法公布10起打击拒执罪典型案例 [Supreme People’s Court issues 10 model cases on combating evasion of debt offences], an article published by the People’s Daily Online on 5 June 2018, available at http://legal.people.com.cn/n1/2018/0605/c42510-30037516.html (last accessed on 27 July 2022). This article mentions that a total of 8687 individuals were convicted of the offence of debt evasion from January 2015 to April 2018 in Chinese courts across all levels.
  85. See夫妻共同债务:陷阱与救济 [Community debt of spouses: pitfalls and rescue mechanisms], 29 May 2019, article published by the People’s Procuratorate of Guangdong province, accessible at http://www.gd.jcy.gov.cn/xwzx/ajjj/201905/t20190529_2581708.shtml (last accessed on 27 July 2022). This article highlights how spouses collude to divorce in order to evade liability for debts.See also 妥善审理涉及夫妻债务纠纷案件,依法平等保护各方当事人合法权益 [Resolving marital debt disputes appropriately, protecting legal rights of stakeholders fairly and in accordance with the law], 17 January 2018, article published by the Supreme People’s Court of the People’s Republic of China, accessible at https://www.court.gov.cn/zixun-xiangqing-77362.html (last accessed on 30 June 2022). This article mentions how spouses collude to hinder creditor enforcement.
  86. Zui Gao Ren Min Fa Yuan Guan Yu Shi Yong Zhong Hua Ren Min Gong He Guo Min Fa Dian Hun Yin Jia Ting Bian De Jie Shi (Yi) 最高人民法院关于《中华人民共和国民法典》婚姻家庭编的解释(一) [Interpretation (I) of the Supreme People’s Court on the Application of the “Marriage and Family” Book of the Civil Code of the People’s Republic of China] (promulgated by the Judicial Committee of the Supreme People’s Court, effective 1 January 2021), article 35. Article 35 provides that “Where the divorce agreement of the parties or the effective judgment, ruling, or mediation decision of the people’s court has dealt with the partition of marital property, the creditor shall still have the right to file a claim against both parties for their community debt.Where one party, after having assumed the responsibility for paying off the community debt, claims that the other party should pay the corresponding debts according to the divorce agreement or the legal instrument of the people’s court, the people’s court shall support such a claim.”
  87. Lin Wei Dan. v. Postal Savings Bank of China Co., Ltd (Branch in Changsha city, Kaifu district) (financial loan dispute), 6 July 2022 (Changsha City Intermediate People’s Court), cited as (2022)湘01民终3871号.
  88. See the article titled Hun Yin Fa Si Fa Jie Shi (San) Da Ji Zhe Wen, 婚姻法司法解释(三)答记者问 [Judicial Interpretation No. 3 on Marriage Law, answering questions posed by interviewers] published by the Supreme People’s Court on 29 September 2011, available at https://www.court.gov.cn/shenpan-xiangqing-3186.html (last accessed on 27 July 2022). This article mentions how the Supreme People’s Court referred to marriage laws in foreign jurisdictions in opining whether spouses could apply to divide their property during marriage.See also the article by Yang Sui Quan (杨 遂 全), 现行婚姻法的不足 与民法典立法对策 [Deficiencies in the present Marriage Law and measures implemented in the Civil Law], published in the Chinese Journal of Law in 2003, available at http://www.faxueyanjiu.net/Admin/UploadFile/publish_article/2003/2/20030204.pdf (last accessed on 27 July 2022). The author mentions that China can look to the French Civil Code in determining issues such as residency rights of ex-spouse after divorce.
  89. See the article by Wang Jiang Yu (王江雨), 当代中国法律制度的基本特征、 结构与未来发展展望 [Basic features, structure and future aspirations for development of the legal system of contemporary China.], published in 东亚论文 [East Asia Research] in 19 August 2010, available at https://research.nus.edu.sg/eai/wp-content/uploads/sites/2/2017/11/CWP86.pdf (last accessed on 27 July 2022). The author mentions that the Chinese legal system is based on the civil law systems of Germany and Japan, but has also incorporated large elements of the English common law system, particularly in the commercial context.
  90. Minfa, (民法)[Taiwan Civil Code] (amended on 1 January 2020 by the Ministry of Justice), accessible at https://law.moj.gov.tw/ENG/LawClass/LawAll.aspx?pcode=B0000001 (last accessed on 27 July 2022).
  91. Supra note 90, Article 1017. Article 1017 provides that “The property of either the husband or the wife shall be divided into the property acquired before marriage and the property acquired in marriage, and shall be owned respectively. If the property could not be proven to be the property acquired before marriage or in marriage, it shall be presumed as the property acquired in marriage; if the property could not be proven to be owned by the husband or the wife, it shall be presumed as owned by the husband and the wife jointly.
    The remains of fruits gained from the property acquired either by the husband or the wife before marriage during the continuance of the marriage relationship shall be deemed as the property acquired in marriage. If the husband and the wife have contracted the holding of matrimonial property, and then adopted the statutory regime, the property before the adoption shall be deemed as the property acquired before marriage
    .”
  92. Supra note 90, article 1038. Article 1038 provides that “Debts payable out of the common property, where have been paid out of the common property, no claim for compensation will arise. Debts payable out of the common property, where have been paid out of the separate property, or debts payable out of the separate property, where have been paid out of the common property, the claim for compensation shall arise and can be made even during the continuance of the marriage relationship.”
  93. 田韶华,论共同财产制下夫妻债务的清偿 [Tian Shao Hua, Discussing debt repayment in a joint debt system], article published in the website of China Civil and Commercial Law, available at https://www.civillaw.com.cn/zt/t/?id=35988 (last accessed on 27 July 2022). The author is a professor at the law school of the Hebei University of Economics and Business.
  94. See the English translation of the French Civil Code, translated by Georges Rouhette, Professor of Law, with the assistance of Dr Anne Rouhette-Berton, Assistant Professor of English. The English version of the French Civil Code is available at https://www.fd.ulisboa.pt/wp-content/uploads/2014/12/Codigo-Civil-Frances-French-Civil-Code-english-version.pdf (last accessed on 27 July 2022).
  95. Article 220 of the French Civil Code provides that “Each one of the spouses has the power to make alone contracts which relate to the support of the household or the education of children: any debt thus contracted by the one binds the other jointly and severally. Nevertheless, joint and several obligations do not arise as regards expenditures that are manifestly excessive with reference to the way of living of the household, to the usefulness or uselessness of the transaction, to the good or bad faith of the contracting third party. They do not arise either, where they were not concluded with the consent of the two spouses, as regards instalment purchases or loans unless those relate to reasonable sums needed for the wants of everyday life.”
  96. Ibid.
  97. Article 1415 of the French Civil Code provides that “Each spouse may obligate only his separate property and his income, by surety or loan, unless they have been contracted with the express consent of the other spouse, who, in that case, does not obligate his separate property.”
  98. See the English translation of the German Civil Code, available at the website of the Federal Ministry of Justice at http://www.gesetze-im-internet.de/englisch_bgb/englisch_bgb.html#p4674 (last accessed on 27 July 2022).
  99. Section 1363 paragraph 2 of the German Civil Code provides that “The property of the husband and the property of the wife do not become the common property of the spouses; the same applies to property that one spouse acquires after marriage. The accrued gains that the spouses acquire in the marriage, however, are equalised if the community of accrued gains ends.
  100. Section 1357 paragraph 1 of the German Civil Code provides that “Each spouse is entitled to enter into transactions to appropriately provide the necessities of life of the family, also binding the other spouse. Such transactions entitle and oblige both spouses, unless it appears otherwise from the circumstances.
  101. The US community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin.
  102. CAL. FAM. CODE § 910(a) available at https://leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=FAM&division=4.&title=&part=3.&chapter=2.&article= (last accessed on 27 July 2022). § 910(a) provides that “Except as otherwise expressly provided by statute, the community estate is liable for a debt incurred by either spouse before or during marriage, regardless of which spouse has the management and control of the property and regardless of whether one or both spouses are parties to the debt or to a judgment for the debt.”
  103. ARIZ. REV. STAT. ANN. § 25-215; available at https://www.azleg.gov/ars/25/00215.htm#:~:text=25%2D215%20%2D%20Liability%20of%20community,for%20community%20and%20separate%20debts&text=A.,property%20owner%20to%20the%20contrary (last accessed on 27 July 2022). § 25-215(B) provides that “The community property is liable for the premarital separate debts or other liabilities of a spouse, incurred after September 1, 1973 but only to the extent of the value of that spouse’s contribution to the community property which would have been such spouse’s separate property if single.”
  104. Gardner Aldrich, LLP v. Tedder, 421 S.W.3d 1 (2011) (Court of Appeals of Texas, Fort Worth).
  105. Creech v. Capitol Mack, Inc., 287 So.2d 497 (1973) (Supreme Court of Louisiana).
  106. Refer to Annex 2 for a summary of homestead exceptions in US Community Property States.
  107. Supra note 71. In this article, the author proposes solutions to address issues in enforcement against real property owned by non-debtor spouses and debtor spouses. One solution is to sell the property and apportion sale proceeds between co-owners, while considering practical matters such as preserving family relationship. This solution is already adopted by the UK courts.
  108. Married Women’s Property Act 1882, Section 1(1), accessible at https://www.legislation.gov.uk/ukpga/Vict/45-46/75/enacted (last accessed on 27 July 2022). Section 1(1) provides that “A married woman shall, in accordance with the provisions of this Act, be capable of acquiring, holding, and disposing by will or otherwise, of any real or personal property as her separate property, in the same manner as if she were a feme sole, without the intervention of any trustee.”
  109. Supra note 108, Section 1(2). Section 1(2) provides that “A married woman shall be capable of entering into and rendering herself liable in respect of and to the extent of her separate property on any contract, and of suing and being sued, either in contract or in tort, or otherwise, in all respects as if she were a feme sole, and her husband need not be joined with her as plaintiff or defendant, or be made a party to any action or other legal proceeding brought by or taken against her; and any damages or costs recovered by her in any such action or proceeding shall be her separate property ; and any damages or costs recovered against her in any such action or proceeding shall be payable out of her separate property, and not otherwise.”
  110. The position in Singapore can be found in the Women’s Charter 1961, accessible at https://sso.agc.gov.sg/act/wc1961?ProvIds=P16-#pr51- (last accessed on 27 July 2022). Section 51 of the Women’s Charter 1961 provides that “Subject to the provisions of this Act, a married woman shall – (a) be capable of acquiring, holding and disposing of, any property; (b) be capable of rendering herself, and being rendered, liable in respect of any tort, contract, debt or obligation; (c) be capable of suing and being sued in her own name either in tort or in contract or otherwise and shall be entitled to all remedies and redress for all purposes; and (d) be subject to the law relating to bankruptcy and to the enforcement of judgments and orders, in all respects as if she were a feme sole.”
  111. See Housing and Development Act 1959, Sections 58(7) and 58(12), accessible at https://sso.agc.gov.sg/Act/HDA1959?ProvIds=P14-#pr58- (last accessed on 27 July 2022). Section 58(7) provides that “No protected property is to be attached in execution of an order of any court unless the order of the court is obtained by — (a) a mortgagee in exercise of the mortgagee’s rights under a mortgage created with the prior written consent of the Board over that property; or (b) a chargee in exercise of the chargee’s rights under a charge under any written law over that property.” Section 58(12) defines a “protected property” to mean “any flat, house or other building that has been sold by the Board under the provisions of this Part”.
  112. Lye Lin-Heng, Public Housing In Singapore: A Success Story In Sustainable Development, National University of Singapore Asia-Pacific Centre for Environmental Law Working Paper 20/02, page 12, available at https://law.nus.edu.sg/apcel/wp-content/uploads/sites/3/2020/06/014_2020_LyeLinHeng.pdf (last accessed on 27 July 2022). The author mentions that “However, one major benefit unique to HDB flats is that they are protected from creditors in the event of the owner’s bankruptcy if one of the owners is a Singapore citizen. This is to ensure greater security for a Singapore family should the breadwinner fall upon hard times.”
  113. In Singapore, this position is stated in the Land Titles Act 1993, Section 135(1), accessible at https://sso.agc.gov.sg/Act/LTA1993?ProvIds=P113-#pr135- (last accessed on 27 July 2022). Section 135(1) provides that “The interest in registered land which may be sold in execution under an enforcement order is the interest which belongs to the judgment debtor at the date of the registration of the enforcement order.”In UK, this position is stated in the Charging Orders Act 1979, Section 2(1)(a)(i), accessible at https://www.legislation.gov.uk/ukpga/1979/53/section/2 (last accessed on 27 July 2022). Section 2(1)(a)(i) provides that “Subject to subsection (3) below, a charge may be imposed by a charging order only on— any interest held by the debtor beneficially in any asset of a kind mentioned in subsection (2) below” Section 2(2) defines an “asset” to mean “land”.
  114. See the Singapore High Court decision of Ong Boon Hwee v Cheah Ng Soo [2019] 4 SLR 1392, at [73] .The Singapore High Court held that “a joint tenant’s interest is exigible to a WSS”. A WSS (Writ of Seizure and Sale) is an execution order over immovable property.See also the English decision in Lord Abergavenny’s case (1607) 6 Co Rep 78b; 77 ER 373, in which the court allowed the plaintiff to execute judgment against a land held under joint tenancy.See also the Canadian Supreme Court decision in Maroukis v Maroukis [1984] 2 SCR 137, in which a judgment debtor’s interest in immovable property which was held under a joint tenancy may be taken in execution.
  115. 建设部、发展改革委、监察部等关于印发《经济适用住房管理办法》的通知(2007修订) [Notice of the Ministry of Construction, the National Development and Reform Commission, the Ministry of Supervision, the Ministry of Finance, the Ministry of Land and Resources, the People’s Bank of China and the General Administration of Taxation on Issuing the Administrative Measures for Affordable Houses (2007 Revision)] (issued on 19 November 2007 by the Ministry of Construction, Ministry of Supervision and the State Development & Reform Commission), Article 1. Article 1 provides that “These measures are formulated for the purpose of improving and regulating the affordable housing system and protecting the legitimate rights and interests of all parties concerned”.
  116. Leigh J. Francis, Calling All Debtors, Want to Defraud Your Creditors? Here is How: The Tenancy by the Entirety Loophole and the Nullification of Section 522(o), (p), and (q) of the 2005 Bankruptcy Amendments, 18 U. Miami Bus. L. Rev. 1 (2010), available at http://repository.law.miami.edu/umblr/vol18/iss1/2 (last accessed on 27 July 2022).
  117. Zui Gao Ren Min Fa Yuan Guan Yu Ren Min Fa Yuan Min Shi Zhi Xing Zhong Cha Feng, Kou Ya, Dong Jie Cai Chan De Gui Ding (2020 Xiu Zheng))《最高人民法院关于人民法院民事执行中查封、扣押、冻结财产的规定(2020 修正)》[Provisions of the Supreme People’s Court for the People’s Court to Seal Up, Distrain and Freeze Properties in Civil Enforcement (2020 Amendment)], Article 12. Article 12 states that “A people’s court may seal up, distrain or freeze the properties jointly owned by the enforcee and other person(s), but shall notify the joint owners in time. Where the joint owners divide their jointly owned properties by agreement, and have been confirmed by the creditors, the people’s court may ascertain such division to be effective. The effectiveness of the sealing, distraining or freezing measure shall cover the portion of properties owned by the enforcee after division by agreement; meanwhile, the people’s court shall make an ruling on canceling the sealing, distraining or freezing measure over the portion of properties owned by other joint owners. Where any of the joint owners brings a lawsuit for dividing properties or the person applying for enforcement brings in subrogation a lawsuit for dividing properties, the people’s court shall grant permission, and suspend enforcement of the properties during the period of lawsuit.”
  118. Li Hong. v. Yang Zhen (objections to enforcement), 7 April 2022 (Dalian City Intermediate People’s Court), cited as (2022)辽02民终2695号.
  119. Walton & Anor v Allman [2015] EWHC 3325 (Ch) (18 November 2015), paragraph 57.
  120. Ibid.
  121. Supra note 119 at paragraph 60.
  122. Supra note 71. The author does not refer to UK laws in his article. However, he indirectly alludes to the UK approach in enforcement proceedings, by mentioning how the courts should balance the interests of creditor and property owners. The author also suggests that the courts consider the interests of family members living within the property subject to execution, during enforcement proceedings. These suggestions are in line with the approach of the UK courts such as in Walton & Anor v Allman [2015] EWHC 3325 (Ch).
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