A certain company, as a borrower, signed a loan contract with a certain bank in 2015, with a loan term of 1 year and a loan amount of 7 million yuan. Wang and Li, as guarantors, respectively signed guarantee contracts with banks to provide guarantees for a company's loan of 7 million yuan. Wang was born in 2000 and is a shareholder of a certain company. Li, the mother of Wang, as Wang's legal representative, signed the resolution of the shareholders' meeting and ratified Wang's act of providing guarantees for a certain company's loan.

Later, a certain company, as the borrower, failed to fulfill its obligation to repay principal and interest as agreed, and Wang and Li, as guarantors, also failed to fulfill their repayment obligations as stipulated in the contract. A certain bank has filed a lawsuit with the court, demanding that a certain company, Wang, and Li fulfill their obligation to repay principal and interest.

After trial, the court found that Wang was a person with limited capacity for civil conduct when signing the guarantee contract, and was unable to express his true intention regarding the signing of the guarantee contract. Li's subsequent recognition of the guarantee contract was not made for Wang's benefit, and the guarantee contract should be deemed invalid according to law. Therefore, the bank's lawsuit requesting Wang to bear the guarantee liability was rejected.

The focus of controversy in this case is whether Wang bears the guarantee responsibility. Wang signed the guarantee contract at the age of 15, which is a person with limited capacity for civil conduct. The signing of the 7 million yuan guarantee contract is not suitable for his age and intellectual status, and he cannot make a true expression of intention. Based on the assets under Wang's name, the shares he holds in a certain company, and the subscribed capital, Wang's provision of guarantee for the company clearly exceeds his economic ability and carries extremely high risks. Therefore, as the guardian, Li's retroactive recognition of the guarantee contract does not constitute a purely profit-making act of receiving rewards, gifts, remuneration, etc., but rather a disposal of the ward's property for the sake of the ward's interests, and should be deemed invalid. Wang does not assume any guarantee responsibility.

The original intention of establishing the guardianship system is to compensate for the lack of minors' behavioral capacity, safeguard their interests, and ensure their healthy growth. Therefore, the legal provisions restrict the basic principles and scope of the guardian's exercise of the power of agency, that is, the guardian's exercise of the power of agency should be based on the best interests of the ward, and the guardian should not dispose of the ward's property except for safeguarding the ward's interests. As a common and typical guarantee method, the establishment of a guarantee contract is to ensure the realization of the creditor's rights. Once the guarantor signs the guarantee contract, there is a risk of assuming the performance of the debt in the future. If the debtor fails to repay the loan as agreed, the guarantor has the responsibility to repay the debt.

When signing the guarantee contract, if the guarantor is a minor, the effectiveness of the guarantee should focus on the following two points:

One is whether the act of signing a guarantee contract by a minor is represented, ratified, or agreed upon by their legal representative. The act of providing guarantees for the debts of others is aimed at protecting the interests of creditors and belongs to a single contract. It is clearly not a purely beneficial civil legal act and is not suitable for one's age and intellectual status. According to Article 19 of the Civil Code of the People's Republic of China, it shall be represented, ratified, or agreed upon by its legal representative, otherwise it shall not be effective for minors.

The second is whether the representation, consent, or ratification of the legal representative is made with the purpose of safeguarding the interests of minors. The purpose of establishing a guardianship system is to protect the legitimate rights and interests of individuals without civil capacity and those with limited civil capacity. According to Article 35, Paragraph 1 of the Civil Code of the People's Republic of China, guardians shall follow the principle that is most beneficial to the ward when performing their guardianship duties. The guardian can only dispose of the property of the ward for the purpose of safeguarding the interests of the ward. "For the interests of the ward" should be regarded as the ward setting rights and obtaining benefits. For example, to protect the basic rights and interests of the ward such as education and medical treatment, entering into a guarantee contract is in line with the ward's interests.

The loan amount involved in this case is 7 million yuan. If the debtor is unable to repay it, the minor Wang, who is still in high school, will be jointly and severally liable for the loan and interest. His personal property will face huge risks and will also lay serious hidden dangers for his future studies and life, which is not conducive to the healthy growth of the minor. When dealing with matters involving minors, priority should be given to safeguarding the legitimate rights and interests of minors, carefully balancing the interests of all parties, and maximizing the protection of the interests of minors. Therefore, regardless of whether the guarantee behavior has been approved or ratified by Wang's guardian, the guarantee contract involved in the case has no legal effect on Wang.

This article is transferred from the WeChat official account "Shandong Gaofa". Thank you!