Dilemma and Solution to Debtor Protection in Subrogation Settlement
Subrogation settlement involves the balance of interests of diverse parties,with the legitimacy of debtor protection evi-dent from jurisprudential and value-based perspectives.Although Article 524 of The Civil Code stipulates the regulations for sub-rogation settlement,the norms pertaining to debtor protection remain ambiguous,posing a practical challenge in their application.To address this,with the help of Article 468 related to the contract,the paper tries to explore the optimization path for debtor protection.Since the restriction of subrogation settlement includes legal restriction and contractual restriction,in the consideration of legal restriction,the public interests and private interests are distinguished to determine the extent of debtor protection.In view of the balance of the interests among various parties,contractual restriction,however,can only be expressed.The notice rule,serving as a safeguard for debtors,makes it clear that debtor protection in subrogation settlement is in the mode of antagonism.Not only the creditor,but the third party who meets certain conditions are entitled to issue such notices.Meanwhile,the applica-tion of the defense and offset rule can effectively protect the interests of the debtor.Defense strategies encompass both substantive and procedural defenses,with the timing of the debtor's defense claim aligning with the notice.What s more,the legal effect of the offset is non-retroactive,taking effect upon notice,while the delay interest and liquidated damages continue to accrue.
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