Simon Says: Does a Debt Go When a Borrower Dies?

This is the sixteenth in a weekly series of legal advice provided in a short and entertaining story format.


This week's areas of Interest: Debt Obligations and Inheritance


This week's keywords: Contract, Lender and Borrower, Inheritance and Heir



Does a Debt Go When a Borrower Dies?



Jack is a middle aged man living in Beijing. He goes to the gym, runs every morning before work and swims with Jackson, his son, every weekend.
One day, while he was having his morning jog, he felt a sudden pain in his chest. He also began coughing violently, spewing blood everywhere. Confused, he went to see the local doctor. After a simple diagnosis, the doctor suggested he have a CT scan to see what was happening.


Terrible news awaited Jack. He was diagnosed with stage 4 lung cancer. Jack didn’t believe it at first, as he was a non-smoker. After visiting multiple hospitals, he was left with the same conclusion – maybe his morning jogs in the smog of Beijing was a cause of his lung cancer, and he didn’t have much time left, less than half a year.


Jack knew that lung cancer was incurable, so he didn’t want to waste money on treatment either. He decided to buy every kind of insurance he could find, so he could leave some money for his son before he died. However, as insurers were informed of his sickness, all his applications were turned down, as he was basically a dead man walking.


Knowing he had not much inheritance for his son, Jack had to think of another way. An idea popped into his mind. He would borrow money and buy assets with it, as a last gift for his son.


A few months after Jack’s death, his son Jackson was approached by a guy saying that his dad had owed him some money.


Surprised, Jackson said, “Well I am sorry to say that he passed away about a year ago. If you want money back, go to his grave for it.’


So does Jackson need to pay his father’s debt?




Prof Simon Says:


Yes, Jackson has to pay for the debt from his dad’s estate.


According to Chinese laws, debts shall be repaid from deceased’s inheritance and all assets of the deceased shall be taken into account, like houses, shares, debenture and cash.


If the estate fails to repay all the debts, it is up to the heirs to decide whether to take money out of their own pockets to finish up the payment. Under Chinese law, there is no mandatory legal obligation to force the heirs to repay the deceased’s debts other than from the estate.


Simon Says - Episode 16: Does a Debt Go When a Borrower Dies?



For more about this or to contact Professor Simon Choi at, +86 13823677853 or by WeChat: simonhkchoi. 


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"This article was originally written in Chinese by Mr Huanyu Li and rewritten into English by Simon Choi."


Simon Choi

About the Author: Professor Simon Choi

Prof Simon Choi, solicitor and linguist, is an international lawyer, qualified to practise law in England & Wales and in Hong Kong, China. Simon graduated from law schools of the Peking University, the University of London and the University of Hong Kong respectively, with an in-depth knowledge of Chinese laws and common laws and with more than 20 years experience in China practice and international trade, investment, finance, merger & acquisition. He is an adjunct professor of laws at the Zhongnan University of Economics and Law. Simon is the founding partner of Acme Ardent and can be reached at or +86 13823677853.

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14 Jun 2017

By Simon Choi

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