Problems of Mortgage Enforcement After the Lapse of Time

Abstract

The enforcement of mortgage under the Civil and Commercial Code involves the invocation of the mortgagee’s right. However, following a lapse of the time prescribed as the mortgage enforcement period, the enforcement cannot be undertaken, even though the right to the mortgaged property still resides with the mortgagee, as upheld by the Supreme Court judgment (at a plenary session). This raises the legal problem relating to the ratification of the right to the mortgaged property under the Civil and Commercial Code; that is, whether the mortgage has resulted in such a right, and the problem of whether after the lapse of the enforcement time under the Civil Procedure Code the mortgage enforcement is still legally permissible. This paper explores the principles and concepts involving real rights and mortgaging, prescription and the time limit for mortgage enforcement. The paper is a comparative study of the rights to mortgaged property and mortgage enforcement with a particular reference to the relevant law in France and Germany.

The study has found that the provisions in the Civil and Commercial Code on mortgage are not clear in both the ratification of the real right over the mortgaged property and mortgage enforcement following the lapse of time within which this legal measure must be taken, in accordance with the Civil Procedure Code. That is, whereas mortgage under the Civil and Commercial Code gives rise to bound everyone (erga omnes), this is still not regarded as constituting (numerus clausus) under the law, and the mortgage enforcement following the lapse of the time period for this undertaking is not possible even though the real right is still legally upheld. In France and Germany the real rights are incorporated in legal provisions or endorsed under property law, and the conditions for the revocation of the mortgage are clearly and consistently identified.