Last year I was remiss in not blogging about the KMT’s abolition of the Taiwanese law which held minors responsible for the debts of their deceased parents. Now it seems as though the KMT has made further changes to the law, exempting adult children as well:
A committee of the Legislative Yuan approved yesterday the latest revisions of regulations to exempt adults from excess debts incurred by their parents or other family elders after inheriting assets from them.
The new rules added to the Civic Code by the Judiciary and Organic Laws Committee will allow the heirs to abandon the inheritance rights as a way to give up both the assets and debts if the debt amounts are higher than the value of assets they are entitled to.
I was astounded to learn that inheritance laws were so Dickensian here. While I personally don’t stand to benefit in any way from these reforms, I will say this: Good on the KMT, and good on Ma Ying-jeou. It’s pretty outrageous to think of a person just borrowing a pile of money and wasting it all, secure in the knowledge that his kids will be the ones who’ll have to pay for it.
(The banks are right about one thing though; this WILL cause creditors to tighten their loan policies. But I would argue that it’s good that banks should evaluate loans on the MERITS of the borrowers’ proposals, rather than basing their decisions simply on the collateral of children’s future labor.)
UPDATE (Apr 26/08): More details on this here.