Hi,
I am new to this forum, I have a case and would like your inputs on the same.
If a husband is in a debt and his wife is not aware of the same. The case is, husband informed wife during marriage of a loan he has taken and he needs to repay. However, he never indulged information about how much the amount was and assured wife that its in control. Despite of many efforts from wife to ask him, he refused to tell or just said there is no liability to get her off back.
Wife comes to know many months later about the loan amount and its alamingly high. In this case, if something happens to husband (like death), how can wife protect herself as she will not be able to pay the same on her own. In this case, husband is paying regular instalments and is repaying the loan to best of his abilities.
Legal heirs, who takes over property as legal heir also takes over all liability like loan.
It suggested to get an insurance cover for loan so that if any mis-happening arise to the person, who originally took the loan, then insurance company will have to pay remaining loan and hence legal heirs will get only asset and not liability.
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Mr. Prasad has given valuable advice. Kindly follow it.
The Lady may also start putting in funds at her disposal or her funds in instruments which can not be attached by court decree e.g. PPF, Insurance Policy under MWPA.
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This is an interesting discussion.
Valuable advice of learned experts/members is sought.
Even if the legal heir {spouse in this case} is not co applicant or guarantor the law has included liability of legal heir for payment of debt.
Thus legal heir {wife} should have a right on the details and information on the debt on head of the family {husband in this case}. The disclosure or concealment by borrower may not absolve the legal heir from their liability to pay the debt.
The matter may not be limited to information alone but may extend and expand to payment of the debt in his lifetime thus leaving no liability of payment and on legal heir or being subjected to humiliation, and legal battles.
The elders in the family from both sides can sit and counsel the borrower {husband in this case} to appraise and share the documented details of the debt and ability to pay the full amount of debt.
Spouse may ensure that like during marriage each relative, near and dear ones contribute each one may contribute to clear the borrowing and thus help the family.
The wife and children may not be helped by just payment of regular EMI’s of the loan as there should be sufficient amount available after payment of loan to run the other affairs of the family.
The liability of the legal heir{s} is limited to the % of the estate inherited by each legal heir from deceased borrower.
The courts have made some scathing remarks in case of unwilling legal heir e.g.
Delhi High Court
Kamal Gupta vs Bank Of India on 1 November, 2007
“Where the context requires a definition to be given a different meaning than the one prescribed by the definition clause, courts are not powerless to give a different meaning to a defined word,”
“The rights which a dead man thus leaves behind him vest in his representative. They pass to some person whom the dead man, or the law on his behalf, has appointed to represent him in the world of the living. This representative bears the person of the deceased, and therefore has vested in him all the inheritable rights, and has imposed upon him all the inheritable liabilities of the deceased.”
“The representative of a dead man, though the property of the deceased is vested in him, is not necessarily the beneficial owner of it. He holds it on behalf of two classes of persons, among whom he himself may or may not be numbered. These are the creditors and the beneficiaries of the estate. Just as many of a man's rights survive him, so also do many of his liabilities; and these inheritable obligations pass to his representative, and must be satisfied by him”
“Therefore, from whatever angle we examine the issue it is apparent that the legal representatives and legal heirs of Smt.Parvati Devi would also be liable and their liability do not get absolved on her death. The mortgage and the letter of guarantee executed by the predecessor in interest of the appellants would not loose their force on the death of the executrix Smt.Parvati Devi.”
Hence the legal heir may put in effort and seek ways and means for payment of debt in lifetime of borrower.
If legal heirs are guarantor:
“ Revocation and Termination of Guarantee
The guarantee can be revoked for future transactions on happing of the following events:
a) On receipt of notice of revocation from the guarantor in that case the guarantor
has to give three months notice if necessary.
b) Provision is male in the agreement – Notice of death, insolvency, insanity of the
principal borrower or.
c) Change in the constitution of the principal borrower when it is a partnership firm
The guarantee shall stand revoked for future transaction from the date of receipt of
notice about the change in constitution either by admission or retirement or
expulsion of a partner etc.”
Attached:
Delhi High Court
Kamal Gupta vs Bank Of India on 1 November, 2007
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