With a subject amount of 4.92 billion yuan, this case set a record for the highest subject amount since the establishment of the Guangzhou Intermediate People’s Court. It involves cutting-edge issues such as the consolidated trial of different legal relationships, the characterization of credit enhancement measures, the scope of application of guarantee rules, and the liability of listed companies for “illegal guarantees”. The legal team representing this case sued both the trust loan debtor and the trust plan’s deficit coverage obligor in a single case, avoiding the huge litigation costs of separate lawsuits. This case is the first publicly-judged case that confirms that independent contract-based credit enhancement measures shall apply guarantee rules by analogy.
The “Deficit Coverage Agreement” is a widely used credit enhancement tool in financial practice. As the first publicly-judged case in China to determine that independent contracts should still apply guarantee rules by analogy, this case provides innovative judicial suggestions for the characterization of credit enhancement documents of financial institutions and the analogous application of guarantee rules, which will have a far-reaching impact on the design and application of such credit enhancement measures.
The case was awarded the 4th Golden Thread Award, exerting significant social influence and demonstrating remarkable innovation and guiding significance.
