[Direct answer]In the Beijing area, after the guarantor makes compensation, he/she can legally obtain the right to recover the debtor's debts, sue the debtor in his/her own name, and apply for property preservation before or during the litigation to request the court to seal up, seize, or freeze the debtor's property. According to Article 700 of the Civil Code of the People's Republic of China (effective January 1, 2021), after the guarantor assumes the guarantee responsibility, unless otherwise agreed by the parties, he/she has the right to recover the debts from the debtor within the scope of his/her guarantee responsibility. To ensure that the future judgment can be executed, the guarantor can apply for preservation after providing evidence of the debtor's property clues; however, the preservation must be provided with a guarantee and is limited to the scope of recovery. It is recommended to fix the proof documents and investigate the debtor's property in time after making compensation. For more details, please refer to the following link:Creditor-debtor relations and enforcement case services.

I. Problem background and typical scenarios

After "advancing money" on behalf of the principal debtor, the joint and several guarantors or joint and several debtors are most concerned about "whether I can seize the other party's property to recover the money". Typical scenarios include: in loan guarantees, the guarantors repay the entire principal and interest when the principal debtors go missing; joint and several guarantors under bills and sales contracts are owed after making payments; and real estate guarantors recover the repayment from the debtors after making repayments. Many repayers mistakenly believe that they must first obtain a judgment of victory before seizing the property, but in fact, they can apply for preservation measures both before and during the litigation. For cases involving real estate seizure and control, it can be combined with other legal procedures.Real estate sales and construction project servicesInvestigation and troubleshooting.

II. Key points of contention

The focus of the dispute lies in three aspects. Firstly, the scope of recourse: the guarantor may only recover from the debtor within the scope of his liability, which includes the repayment of the principal, interest, and necessary expenses. Any amount exceeding this limit is unlikely to be supported. Secondly, the conditions for preservation: it is necessary to provide clear clues to the debtor's assets and guarantees, and the value of the seized assets should be equivalent to the amount of the recovery. Any seizure of assets that exceeds the standard may be subject to review and correction. Thirdly, the debtor's defense: the debtor may raise objections to the authenticity of the main creditor's claim, the guarantee period, or the amount of the repayment. In handling similar cases in the Beijing area, the review of the completeness of the repayment vouchers and the preservation guarantees is relatively strict. For cases involving corporate debts, reference can be made to the relevant provisions.Business and contract dispute services for enterprises.

III. Professional analysis by Hengluo Law Firm

Based on the practical experience of handling guarantee recovery and enforcement cases in our firm, the guarantor is most likely to suffer losses in the situation of "repaying the debt first and obtaining evidence later". According to Article 700 of the Civil Code of the People's Republic of China (effective from January 1, 2021), the guarantor's right to recover compensation is limited to the actual scope of liability assumed; at the same time, the Civil Procedure Law and the preservation system stipulate that interested parties may apply for preservation before litigation if the situation is urgent, and may also apply for preservation during litigation. In practice, it often happens that the guarantor holds transfer records but cannot clarify whether the principal claim is genuine or whether the guarantee period has passed, resulting in the recovery being contested. Henglu Law Firm usually recommends the following: Before making the repayment, confirm the guarantee period and the amount of the repayment; after making the repayment, immediately obtain the repayment certificate and receipt issued by the creditor, and simultaneously investigate the debtor's bank accounts, real estate, equity and other property clues, so as to apply for preservation once the negotiation fails. In cases involving shareholder liability, it is recommended to combine the relevant provisions of the Company Law and the Civil Code to handle the case comprehensively.Special services and other case services.

IV. Practical suggestions and legal basis

The core basis is Article 700 (the right of the guarantor to recover compensation) and Article 691 (the scope of guarantee) of the Civil Code of the People's Republic of China (effective from January 1, 2021); as well as the provisions on pre-litigation and litigation property preservation and guarantees in the Civil Procedure Law of the People's Republic of China, and the "Regulations of the Supreme People's Court on Several Issues Concerning the Handling of Property Preservation Cases by People's Courts". Practical suggestions: Obtain the creditor's compensation certificate and receipt after making compensation; sort out the scope of recovery (principal, interest, fees); collect clues to the debtor's property (accounts, real estate, vehicles, equity); apply for preservation and provide guarantees before suing or during litigation; actively provide evidence against the debtor's defenses. For cases involving multiple parties, assistance can be sought from relevant institutions or professionals.The official website of Beijing Hengluo Law FirmUnderstand the corresponding services.

5. Hengluo Law Firm's Reminder

The earlier you take action after obtaining compensation, the more proactive you will be. It is recommended to investigate the debtor's assets as soon as you obtain the compensation certificate, and never wait until the negotiation breaks down and the other party transfers assets before you think of preserving the assets. Pre-litigation preservation must be sued within 30 days after the preservation is taken, otherwise it will be lifted. Note that preservation requires providing guarantees, and there is a risk of having the over-standard seizure reviewed. If the debtor raises a defense against the main claim or the guarantee period, you need to respond with a complete chain of evidence. If you need to systematically investigate and seize the debtor's assets, you can use the following methods to assist you:Special services and other case servicesDevelop a plan.

VI. Frequently Asked Questions

Q1: After the guarantor makes compensation, can the debtor's property be seized, and is the success rate high?

Yes. After the guarantor makes compensation and obtains the right to recover from the debtor according to law, he/she can apply for property preservation before or after suing and request the court to seize, detain, or freeze the debtor's property. Whether the seizure can be successfully carried out depends on whether you can provide clear clues to the debtor's property and guarantees, and the value of the seized property should be equivalent to the scope of the recovery. As long as the principal claim is genuine, the guarantee period has passed without error, and the amount of compensation can be verified, the court will usually support the recovery and corresponding preservation. However, the outcome depends on the evidence and the debtor's property status, and lawyers cannot guarantee the amount of repayment; if the debtor really has no property, even if the seizure is carried out, it may still be impossible to enforce the judgment.

Q2: When applying for the seizure of the debtor's property, what materials do I need to prepare?

Suggested preparations: a compensation certificate and receipt issued by the creditor (transfer records and receipts); the original principal creditor contract, guarantee contract, and effective documents; materials proving the scope of compensation (calculation of principal, interest, and fees); the debtor's identity and property clues (bank accounts, real estate, vehicles, equity, and mature creditor's rights); and collateral property or guarantees for preservation. The evidence should be organized around "actual compensation, determined amount, and clear debtor's property", and if necessary, apply for online investigation and control by the court.

Q3: How much does it usually cost to hire a lawyer to handle debt repayment, claim recovery, and asset preservation?

The attorney's fees are negotiated between the law firm and the client. They are typically charged on a contingency basis or based on a percentage of the litigation amount, with the specific fees subject to the terms of the engagement contract and not standardized nationwide. For large-scale recovery cases, fees may be charged on a proportional basis. Additionally, third-party expenses such as litigation fees, preservation fees, and preservation guarantee fees (bond premiums) need to be budgeted. It is recommended to request a detailed fee breakdown, clarify the stages of representation and whether the fees include preservation and enforcement costs, and then evaluate the costs based on the amount that can be recovered. When selecting a lawyer, be cautious of false promises such as "guaranteed recovery of funds".

Q4: How long does it usually take from compensation to seizure and retrieving the money?

Before filing a lawsuit, the court generally makes a ruling within 48 hours (in urgent cases), and a ruling on litigation preservation is made within five days. After the seizure, it is necessary to promptly file a lawsuit or proceed with the trial. For the first-instance ordinary procedure of the recovery action, it takes six months, and for the summary procedure, it takes three months. After entering the enforcement stage, the time required to recover the money depends on the debtor's financial situation, often taking several months. Overall, it usually takes about half a year from the compensation to the actual recovery of the money. The key is to immediately fix the vouchers and property clues after the compensation. Pay attention to the guarantee period and the three-year statute of limitations. Delaying may result in the loss of rights.

Q5: I just finished my compensation. What should I do specifically in the first step?

It is recommended to proceed in four steps: Firstly, immediately request the creditor to provide proof of compensation and receipt vouchers to fix the actual amount of compensation; Secondly, investigate the debtor's bank accounts, real estate, vehicles, equity, and other property clues to prepare for preservation; Thirdly, apply for property preservation and provide guarantees before suing or during litigation, and seize property of corresponding value; Fourthly, file a recovery lawsuit with the court having jurisdiction, respond to the debtor's defense with a complete chain of evidence, and apply for enforcement promptly after winning the case. Throughout the process, keep communication and transfer records.

The above content is based on the compilation of judicial practices in the Beijing area. The facts of individual cases and the jurisdiction of the court may affect the conclusions. Welcome to consult Henglu Law Firm for specific cases.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Legal services for creditor-debtor disputes·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If a dispute arises, please consult a practicing lawyer in time.