Joint and several liability (obligation) is... Concept, examples, differences

The concept of joint obligation and joint liability

The following definitions of the concept “joint and several liability” are given in dictionaries:

Joint and several liability is a type of civil liability for an obligation in which there are several debtors. It arises, for example, when the subject of the obligation is indivisible, or when harm is jointly caused. It is also provided for cases when the agreement does not provide otherwise (thus, under a surety agreement, the debtor and the guarantor are liable to the creditor as joint and several debtors, unless otherwise agreed). (Large legal dictionary. - M.: Infra-M. A. Ya. Sukharev, V. E. Krutskikh, A. Ya. Sukhareva. 2003.)
Joint and several liability is a type of civil liability when there is a plurality of debtors in an obligation, i.e. when several debtors are involved. Unlike shared liability, joint and several liability arises if it is provided for by contract or established by law. In some cases, joint and several liability is provided when the contract does not provide otherwise. Thus, under a surety agreement, the debtor and the surety are liable to the creditor as joint and several debtors, unless otherwise provided by the surety agreement. The parties to this agreement may establish other responsibilities. (Dictionary of financial terms.)

As can be seen from Article 322 of the Civil Code of the Russian Federation, the law identifies two concepts - joint obligations and joint liability.

Joint and several obligations are a “one-for-all” obligation of several persons.

Joint and several obligations arise when several persons act on the side of the debtor and are jointly liable to the creditor. The creditor has the right to make claims against joint and several debtors in any sequence, against any of them or all at once (Article 323 of the Civil Code of the Russian Federation). In this case, the creditor is not required to justify his choice.

Joint and several obligation is the obligation (liability) of debtors according to the principle of mutual responsibility: each of the joint debtors has the obligation to repay the debt as a whole, as if each debtor were the only debtor.

The essence of a joint and several obligation is that until the obligation is fully fulfilled, any of the joint and several debtors is considered obliged to fulfill it.
At the same time, the satisfaction of all the claims of the creditor, completed by one, releases all joint debtors, however, the debtor who has fulfilled the joint obligation acquires the right of claim against the remaining debtors by way of recourse, minus his share (Article 325 of the Civil Code of the Russian Federation).

The meaning of the term “joint and several liability”

To put it in understandable language, this is the right of the victim in various situations to recover from the defendants through legal

proceedings for compensation for the damage caused to him. And it doesn’t matter exactly how many defendants the plaintiff has. But compensation for damage can be made either by each of them in equal shares, or by one person in full. In addition, if the victim, for example, did not receive any part of the damages from one defendant, he receives the full legal right to demand the rest from the other.

It is important to note that it is the plaintiff, as practice shows, who determines the person who will now compensate him in full for all damage caused. On the other hand, the law does not prohibit the defendants, by agreement and without notifying the victim, of distributing obligations among themselves regarding compensation. As a result of this, the plaintiff receives a fairly advantageous position, due to complete confidence that all his claims will be satisfied, and his rights will be protected and restored.

In what cases does joint liability (obligation) arise?

It follows from the provisions of Article 322 of the Civil Code of the Russian Federation that joint obligation (liability) arises in the following cases:

1) if the solidarity of the obligation or requirement is provided for by the contract (for example, the person who transferred the real estate encumbered with rent into the ownership of another person is jointly liable for the requirements of the annuity recipient only if joint liability is established by the contract. In the absence of such a condition of the contract, subsidiary liability arises (clause 2 of Art. 586 Civil Code of the Russian Federation);

2) if the solidarity of the obligation or requirement is established by law , in particular in case of indivisibility (133 Civil Code of the Russian Federation) of the subject of the obligation, in case of joint infliction of harm, etc.;

Joint and several liability is usually provided for by a mandatory norm of law. For example:

liability of participants in a simple partnership agreement for general obligations that arose not in connection with the agreement of the same name (see paragraph 1 of Article 1047 of the Civil Code of the Russian Federation);
liability of persons who jointly caused harm (see Article 1080 of the Civil Code of the Russian Federation);
liability of owners of sources of increased danger for harm caused as a result of the interaction of sources (see paragraph 3 of Article 1079 of the Civil Code of the Russian Federation);
liability of adult family members of the tenant of residential premises under a social tenancy agreement (clause 2 of article 69 of the Housing Code of the Russian Federation);
liability of heirs for the debts of the testator (clause 1 of Article 1175 of the Civil Code of the Russian Federation), etc.

Sometimes the solidary nature of the obligation is established by a dispositive norm. For example:

the liability of insurers who jointly insure one object is joint and several, unless the contract defines the rights and obligations of each of the insurers (Article 953 of the Civil Code of the Russian Federation);
the liability of the guarantor and the debtor in case of failure (improper performance) of the obligation by the latter is joint and several, if the guarantee agreement does not provide for subsidiary liability (Clause 1 of Article 363 of the Civil Code of the Russian Federation).

3) the presence of an obligation of several debtors under an obligation related to entrepreneurial activity (provided that the law, other legal acts or terms of the obligation do not provide otherwise);

Joint and several obligations established by the contract

The legislation does not clearly indicate in what form joint liability is established in the contract, but from the analysis of Art. 322 of the Civil Code of the Russian Federation, it follows that it is necessary from the content of the agreement that each of the debtors has assumed responsibility for the debt as a whole and that the full fulfillment of an obligation by one debtor releases other joint debtors from fulfilling this obligation. In this case, it does not matter whether the concept of joint obligation or any similar concept is used in the contract. The term “joint and several liability” may be absent, but for it to arise, the essence of such liability must be clearly described.

Examples of joint and several liability from a contract can be:

guarantee agreement (Article 363 of the Civil Code of the Russian Federation), which states that in case of non-fulfillment or improper performance by the debtor of the obligation secured by the guarantee, the guarantor and the debtor are jointly and severally liable to the creditor, unless the law or the guarantee agreement provides for the subsidiary liability of the guarantor;
an agreement on the transfer of property encumbered with rent (clause 2 of Article 586 of the Civil Code of the Russian Federation), where it is possible to establish joint and several liability in the agreement.

The Supreme Court of the Russian Federation on joint and several liability in case of indivisibility of obligations and joint infliction of harm

Joint and several liability can only be applied in cases expressly established by contract or law, in particular,

when the subject of the unfulfilled obligation is indivisible
or in case of joint infliction of non-contractual damage in accordance with paragraph 1 of Article 1080 of the Civil Code of the Russian Federation, when it is not possible to establish which of the harm-cauters is responsible for which part of the damage (Definition of the Supreme Court of the Russian Federation dated July 22, 2016 N 305-ES16-7662 in case N A40- 108601/2014)

The essence of the concept

The Civil Code of the Russian Federation defines that a joint and several debt is the responsibility to pay one obligation, assigned equally to several persons at once. Solidarity may arise from the requirements of a treaty. For example, when issuing a loan, when, according to the terms of the loan, in the event of no payments on the part of the borrower, the obligation to reimburse funds is immediately transferred to all guarantors. Solidarity can also arise when the object of the obligation is indivisible. According to Art. 133 of the Civil Code of the Russian Federation, an indivisible object should be understood as a thing that cannot be divided without causing harm to it.

This way you can understand what it means to collect a debt jointly and severally. When several persons (individuals or legal entities) are jointly liable to the creditor for the same obligation. An example is a writ of execution from the court to pay debts for housing and communal services (rent, utilities, etc.) by all adult residents of the apartment.

A debt for which several persons are liable is called joint and several.

Solidary obligation with passive and active plurality

A joint and several obligation with passive plurality is a joint obligation or liability of joint debtors (Articles 322 - 325 of the Civil Code). The regime of joint and several passive plurality guarantees the interests of the creditor, since it provides him with the opportunity to make a claim simultaneously against all debtors or any of them, both in the full amount and in another amount at the choice and desire of the creditor himself.

A joint and several obligation with active plurality is a joint and several claim of joint and several creditors (Articles 322, 326 of the Civil Code). See more details “Solidary claim of creditors”

Differences between joint and subsidiary liability

Solidary and subsidiary liability differ, first of all, in the procedure for holding them accountable.

If, in case of subsidiary liability, the creditor has the right to hold another person liable only additionally, after the debtor (after the debtor fails to fulfill the creditor’s demands for performance), then in case of joint liability, the creditor has the right to hold accountable either any of the joint and several debtors, or all of them together, and demand performance from them obligations of the debtor in any amount within the total amount of losses or damage.

It should be recalled that in case of subsidiary liability, the creditor does not have the right to demand satisfaction of his claim against the principal debtor from the person bearing subsidiary liability if this claim can be satisfied by offsetting a counterclaim against the principal debtor or by undisputed collection of funds from the principal debtor (clause 2 of Article 399 Civil Code of the Russian Federation).

Protection from joint liability 

If you are held jointly and severally liable in court, you should think about defense. The format of protection will directly depend on your legal status and the specifics of the obligations:

If you are one of the founders of an LLC, then you do not need to be afraid of being taken to court - joint and several liability is not provided for in this case (however, do not forget about subsidiary liability).
If your spouse took out a loan and you are held accountable, you can claim that the money was not spent on the family. However, this strategy will only be successful if your spouse actually concealed the loan.
If you are a credit co-borrower, and you live quite poorly, try to talk with the creditor before the trial - there is a chance that he will transfer his claims to another co-borrower.

An example of a joint and several obligation (with a guarantee). Collection procedure

A classic example is the joint obligation (liability) of a guarantor or several guarantors to be responsible for the fulfillment of the borrower’s obligation to the bank.

To ensure the fulfillment of the borrower's obligations to repay the loan, a guarantee agreement is concluded between the bank and another company, under the terms of which the guarantor is jointly and severally liable to the bank for the borrower's fulfillment of the terms of the loan agreement.

In case of non-fulfillment (or improper fulfillment) of obligations by the borrower, the bank makes a demand to the borrower for early repayment of the loan.

However, the borrower did not satisfy the bank’s demand, and therefore the bank filed a lawsuit to collect the amount of debt, interest, penalties, etc....

In the above example, the bank has the right to collect the amount of debt from both the borrower and the guarantors, or from all of these persons at once, at the bank’s choice.

If the obligation of the borrower-debtor is fulfilled at the request of the bank by the guarantor, the latter has the right to demand recovery of the paid funds from other debtors, but minus his share.

We also recommend on the topic:

The debtor and the guarantor, as subjects of joint liability, are brought into the case as co-defendants (clause 1.2 of the review of judicial practice in civil cases related to the resolution of disputes regarding the fulfillment of loan obligations" (approved by the Presidium of the Supreme Court of the Russian Federation on May 22, 2013);
The death of a guarantor under a loan agreement does not terminate the guarantee (clause 9 of the review of judicial practice in civil cases related to the resolution of disputes regarding the fulfillment of loan obligations).

First to the borrower, then to the guarantor?

The creditor has the right to make a claim both against all solidary debtors jointly and against any of them, both in full of the obligation and in any part of it. Having not received full satisfaction from one of the joint and several debtors, he has the right, according to the same rules, to demand what was not received from the others, who remain responsible to him until his demands are fully satisfied.

These provisions are not controversial in judicial practice.

At the same time, in a number of cases, a dispute arises between the parties about the application of the provisions of Articles 322, 323 of the Civil Code of the Russian Federation, in particular, about the order of submission of claims for the collection of debt on a loan: for example, one of the parties believes that such claims should first be presented to to the borrower, and only then to the guarantors.

On the inconsistency of such a position, let us give an example of the arguments of the court, which considered a civil dispute:

“..Solidary obligations arise when several persons act on the side of the debtor and are jointly liable to the creditor. The creditor has the right to make claims against joint and several debtors in any sequence, against any of them or all at once (Article 323 of the Civil Code of the Russian Federation). In this case, the creditor is not required to justify his choice. The motives for filing a claim against any of the joint and several debtors or all of them at once may be different - more convenient jurisdiction, the most adequate property status of the selected debtor, or any personal relationship between the creditor and the selected debtor. The creditor has the right to distribute claims in a different manner. Due to joint liability, each of several debtors must satisfy the creditor's claim in full, but this satisfaction, made by one, frees all.

This legal structure best suits the interests of the creditor, because he has the right to make demands against the debtor who has more realistic opportunities to fulfill the obligation (bear responsibility) than the other joint debtors.

Taking into account the above, the appellant’s arguments about the order of presentation of demands for collection of loan debt: first to the borrower, and only then to the guarantors, are incorrect. Guarantors, by virtue of the provisions of Art. Art. 361, 363 of the Civil Code of the Russian Federation must be liable to the creditor jointly and severally with the debtor Suvar LLC, which presupposes the right of the creditor to apply for execution both to any of the joint debtors and to all debtors simultaneously” (extract from the appeal ruling of the Supreme Court of the Chuvash Republic dated September 20. 2017 in case No. 33-4338/2017).

Joint and several obligation to pay utility bills. Publications

We recommend materials previously published on the site on the topic:

Joint ownership and joint obligation to pay for housing and communal services
Joint and several liability of the owner's family members for payment of housing and communal services
Joint and several collection of debt for payment of housing and utilities from tenants under a social tenancy agreement
Statement of claim for collection of debt for utilities jointly and severally with the spouses - owners

Be jointly responsible

Cases in which a joint response for debts occurs can be divided into several categories:

General response of the borrower and guarantor to the lending institution.

When determining the optimal loan size, the income of the person guaranteeing the borrower is, of course, never taken into account, but the guarantor is assigned certain obligations. As soon as the borrower is unable to repay the loan debt, a special duty of the guarantor begins to operate, based on the principle: pay once you have guaranteed. This position of the guarantor, stipulated by civil law, cannot be challenged and corrected even in court.

When an overdue debt on a loan appears, the bank has the right to forcibly collect money not only from the borrower, a legal entity, but also from its guarantor on absolutely equal terms.

Joint and several liability of heirs.

It involves a joint response to the debts of the testator and may extend to legally capable persons living in residential properties due to a testamentary refusal. Together with the owners of such housing, they are jointly and severally liable for obligations relating to the use of such facilities.

Joint liability of legally married persons.

The husband and wife, in the amount of property owned personally by each of them, are jointly and severally liable for obligations if their jointly acquired property is insufficient for these purposes.

General obligations arising from insurance contracts.

Insurers are responsible to beneficiaries regarding the payment of insurance compensation.

General liability of participants in simple partnerships.

It is assumed to be in the amount of all property owned by the participants.

Joint and several obligations for utility payments

This type of general obligation is possible in situations where several owners own the same property, but the share of each of them is not allocated, and all owners are indicated on one certificate of title. All owners are jointly responsible for timely payment of utility bills.

Statements of claim for joint and several recovery under a contract and compensation for non-contractual damage

Statement of claim for compensation for damage caused by flooding of an apartment (in case of joint and several damage)
Statement of claim for recovery jointly and severally with the debtor and guarantor of debt under the lease agreement, fines and penalties
Statement of claim for recovery jointly and severally with the debtor and guarantor of the debt and contractual penalty under the purchase and sale agreement
Statement of claim for recovery from the joint and several defendant - guarantor of debt for work performed under a contract

Joint and several debt and partial obligation

The two concepts should not be confused, as they have different operating principles. To do this, it is enough to clearly understand what it means to collect an obligation jointly and severally from debtors. The creditor can receive the entire amount of the debt from one debtor, and that debtor has the right to file a recourse claim against the remaining debtors.

When a partial obligation arises, several debtors are also responsible to one creditor for the total debt, but in this case, each is responsible exclusively for their share. No one has the right to demand that the debtor overpay above the norm for other debtors. Moreover, if he does this of his own free will, he will not have the right to file a recourse claim.