Responsible for debt incurred by siblings

Querist : Anonymous (Querist) 05 June 2020 This query is : Resolved
I am from Chennai. Married 35 year old male and have one son. My younger brother aged 30, borrowed money from various persons, chits, bank, relatives for his business purpose and now he is unable to pay them back. In what way it will affect me when they ask for his debt. Am I any way legally responsible. How to handle this. Please guide

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K Rajasekharan (Expert) 06 June 2020
Since he is a grown up adult you have no legal liability in regard to his debts if you have not voluntarily executed any document that binds you to his debts.

Dr J C Vashista (Expert) 06 June 2020
Are you a guarentor in either of loan taken by your brother ? If so, you are liable.

P. Venu

(Expert) 06 June 2020
Yes, you are not liable except to the extent of guarantee or surety you have stood for your son.

Sudhir Kumar, Advocate (Expert) 06 June 2020
If you are guarantor you are fully liable

Sudhir Kumar, Advocate (Expert) 06 June 2020
Money given to friends and relatives is always a charity in the garb of loan which is given in expectation of refund but always taken with intention of non-refund.

Such loan is taken by a person:-

(i) Who lacks business sense and cannot raise funds out of his own business and suddenly wants to be rich.

(ii) who cannot raise bank loan because :-

Either
he himself is not creditworthy

Or
the purpose for which he seeks loan is illegal

or
the purpose for which he seeks loan is not at all commercially viable.

(iii) Who knows he can afford not to refund.
(iv) Who trusts his thick skin
(v) Who intends not to refund
(vi) Who has made fortification against action of refund.

So he has to find someone who can part with his money. SO he finds a lender near him (friend or relative)

Such loans are given by the persons :-

(i) Who has surplus money.
(ii) Who displays and boasts of such surplus money.
(iii) Who stupidly believe that there will be a refund.
(iv) Fails to realise as to why he alone (not bank) is being contacted for loan.
(v) Who has extreme trust on the debtor
(vi) who are either stupid or extremely greedy of the unusual (or illegal) rate of interest.

Such loans are always given

(i) Without documentation.
(ii) Without witness
(iii) Without guarantor.
(iv) During cordial relations

Soon after giving such loan :-

(a) Relations are no more remain cordial
(b) Business started by such money (easy money belonging to other) invariably fails.
(c) Such loans always sink and not refunded.
(d) Person seeking such refund suffers at legal process.
(e) Person seeking such refund legally or by persualtion is socially criticised.

Raj Kumar Makkad (Expert) 06 June 2020
You are not liable for any debt except in which you stood as guarantor. Morally you should try to convince your brother to repay the loans he has obtained.

Rajendra K Goyal (Expert) 06 June 2020
Borrowings were raised by your younger Brother.

You are not guarantor for the said borrowings.

Legally your brother is liable to pay the debt taken by him.

If you have guaranteed or is a co-borrower of the loan you are liable to pay.

Responsible for debt incurred by siblings

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