Viewpoint... Talk about whether creditors have ownership or priority compensation rights for houses under their name.

Published:

2022-08-09

In recent years, due to the impact of the new crown epidemic, the downward pressure on the economy continues to increase, many small and medium-sized enterprises are facing financing difficulties, and some even take "unconventional" channels for financing. For example, some small and medium-sized real estate enterprises are short of funds in the process of housing development, but the houses they develop do not have the conditions to apply for property rights certificates. These enterprises finance by registering the developed houses online or in advance to the lender's name to provide guarantee. The specific operation mode is generally that the debtor and the creditor sign the "commercial housing sales contract", agree to sell the debtor's house to the creditor, and sign the "commercial housing sales contract" online for the record; the creditor does not pay the purchase price to the debtor, and the debtor does not deliver the house to the creditor; and usually does not have the conditions for advance notice registration. If the debtor is unable to repay the debt due, does the lender, as a creditor, have the right to claim ownership of the house or to have a priority right to pay for the auction, sale or discount of the house. This question mainly involves whether the concession and guarantee is established, the following author combined with the Supreme People's Court's relevant jurisprudence for analysis. The relevant provisions and composition analysis of the 1. concession and guarantee system. The concept of cession and guarantee has existed for a long time in judicial practice, and the relevant provisions first appeared in Article 24 of the Provisions of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases (2020 Amendment) (hereinafter referred to as the Judicial Interpretation of Private Lending); article 71 of the Minutes of the National Court's Civil and Commercial Trial Work Conference (hereinafter referred to as the Minutes of the Ninth People's Conference) provides for the first time in its entirety for the nature, effectiveness and priority of the assignment of security; thereafter, the Supreme People's Court on the application of<中华人民共和国民法典>The Interpretation of the Guarantee System (hereinafter referred to as the Judicial Interpretation of the Guarantee System) further optimizes and perfects the cession guarantee system in the Minutes of the Ninth People's Conference. Article 24 of the Judicial Interpretation of Private Lending stipulates that if the parties take the conclusion of a contract of sale as a guarantee for the private lending contract, the borrower cannot repay the loan upon maturity, and the lender requests the performance of the contract of sale, the people's court shall hear the case in accordance with the legal relationship of private lending. If the parties change their claims in accordance with the court hearing, the people's court shall grant permission. After the judgment made in accordance with the legal relationship of private lending comes into effect, the borrower fails to perform the monetary debt determined by the effective judgment, and the lender may apply for the auction of the subject matter of the contract of sale in order to repay the debt. The borrower or lender shall have the right to claim return or compensation for the difference between the price of the auction proceeds and the principal and interest of the loan due. Article 71 of the minutes of the nine people's meeting stipulates that if the debtor or a third party enters into a contract with the creditor, the debtor shall formally transfer the property to the creditor's name, the debtor shall pay off the debt at maturity, the creditor shall return the property to the debtor or the third party, if the debtor fails to pay off the debt at maturity, and the creditor can auction, sell or repay the creditor's rights at a discount, the people's court shall determine that the contract is valid. If the contract stipulates that the debtor fails to pay off the debts when due and the property belongs to the creditor, the people's court shall find that part of the agreement invalid, but it shall not affect the validity of other parts of the contract. According to the above-mentioned contract, the parties have completed the transfer of the publicity method of property rights changes to the creditor's name, and the debtor has not paid off the debts when due, and the creditor requests to confirm that the property belongs to it, the people's court will not support it, but the creditor requests to refer to the law on security rights. If the provisions of the People's Court gives priority to the auction, sale, or discount of property to repay its claims, the people's claims, the people's rights. The people's court shall also support the debtor's request for the auction, sale or discount of the property to repay the debts owed to the creditor under the contract due to the failure to pay off the debts due. The first paragraph of Article 68 of the "Judicial Interpretation of the Guarantee System" stipulates: The debtor or a third party and the creditor agree to transfer the property to the creditor in form, and the debtor fails to perform the due debt, the creditor has the right to discount the property or auction, Where the price from the sale of the property repays the debt, the people's court shall determine that the agreement is valid. If the parties have completed the publicity of the change of property rights, the debtor fails to perform the debt due, and the creditor requests priority payment of the property by reference to the relevant provisions of the Civil Code on security interests, the people's court shall support it. From the above provisions, it can be seen that there are two prerequisites for the achievement of the assignment of security: first, the assignment of security must transfer the ownership of the property to the name of the creditor; Second, the debtor or a third party and the creditor reach an agreement to use the property owned by the debtor or a third party to set up a guarantee for the performance of the debtor's debt at maturity. 2. for the provision of "guarantee" of the house, only for the net sign for the record without notice registration does not constitute a transfer of security, creditors do not enjoy ownership and priority compensation rights. The author has collected and sorted out a number of relevant judgment documents made by the Supreme People's Court recently, and the main points of the judgment are summarized as follows: (I) Cai Ridong and Huaihua Jinshun Real Estate Development Co., Ltd. Dispute over Property Rights Confirmation [(2021) Supreme Fa Min Shen No. 1697]] The main purpose of the decision: The transfer of security requires the debtor or a third party to reach an agreement with the creditor, and the debtor or a third party to have ownership of the property provided, and the net signature filing of the house is not a change of ownership and does not produce the legal effect of the transfer and security. (II) Cui Xuewei and Chongqing Baoshi Real Estate Co., Ltd. General Bankruptcy Creditor's Rights Confirmation Dispute [(2020) Supreme Famin Shen No. 6918]] The main purpose of the decision: the premise of the security right of the house involved in the case is that the parties have completed the publicity of the change of property rights in accordance with the contract, and the property has been transferred to the creditor's name in the form. Although the housing involved in the case went through the online signing procedures, but the housing involved in the case has not changed the registration to the creditor's name, nor did it go through the registration procedures of the security right, the creditor does not enjoy the priority of the housing involved in the case. According to Article 16 of the Enterprise Bankruptcy Law, after the people's court accepts the bankruptcy application, the debtor's debt to individual creditors is invalid. As an ordinary bankruptcy creditor, he has no right to request the debtor to deliver the house to him and handle the transfer procedure. (III) Chen Liang, CITIC Trust Co., Ltd. and Kunshan Hongfeng Real Estate Co., Ltd. Case of Objection to the Execution of Outsiders [(2016) Supreme Law Minzong No. 369]] The main point of the judgment: when the realization of the loan creditor's rights is guaranteed in the form of house sale, the buyer of the house cannot claim to exclude the enforcement of the house according to the lack of real intention of the house sale relationship, even if both parties have already handled the house presale online signing filing, without showing the corresponding evidence that the loan relationship is transformed into the house sale relationship. (IV) Duyun Economic Development Zone Jinxinyuan Microfinance Co., Ltd. and Tan Jiaqin Private Loan Dispute [(2020) Supreme Law Minzai No. 90]] The main purpose of the decision: the guarantee established for the loan to buy and sell the house and handle the presale registration and filing is an atypical guarantee rather than a concession guarantee, does not produce the priority effect of the real right. The establishment of the transfer and security requires that the real estate has completed the publicity of the change of rights, and the property has been transferred to the creditor's name in the form. However, in this case, the housing involved in the case is only presale the record registration in the name of Pingjing and Ted, did not complete the change of ownership of the house, the relationship does not belong to the transfer and guarantee. It can be seen from the above-mentioned judgment documents of the Supreme People's Court that the view of the Supreme People's Court is clear, that is, the debtor only files the house online signature to the creditor's name to provide security, and does not produce the legal effect of concession and security. The creditor neither has the ownership of the house involved in the case, nor does it have the priority to receive compensation for the auction, sale and discount of the house. Some people may wonder why Article 24 of the Judicial Interpretation of Private Lending states that "the parties use the conclusion of a contract of sale as a guarantee for the private lending contract, ...... After the judgment made in accordance with the legal relationship of private lending takes effect, the borrower fails to perform the monetary debt determined by the effective judgment, and the lender may apply for auction of the subject matter of the contract of sale to repay the debt." According to the provisions of the "net sign" whether the person has the priority of compensation for the auction, sale and discount of the house, the question arises because the understanding of the above provisions is not comprehensive and thorough. Because Article 24 of the Judicial Interpretation of Private Lending does not give the borrower (I. e. the creditor) priority over the subject matter of the sales contract, the agreement of the sales contract between the two parties does not have the effect of real right against the third party. Although the creditor has the right to request the auction and sale of the property under the sales contract, the creditor to which the sales contract points has no priority to receive compensation. That is, if the house has been preserved and executed by the court, or if the debtor is a corporate legal person and has entered the bankruptcy liquidation procedure, or the house has actually been sold to another person, or there is a pre-established sales contract, etc., the so-called "net sign guarantee" that only handles the net sign of the house does not have legal exclusiveness and priority compensation. For example, the above-mentioned fourth case, that is, (2020) the civil judgment No. 90 of the Supreme Law Minzeng, found that: "The transaction mode of Jinxinyuan Company and Huasheng Company is in line with the circumstances stipulated in Article 24 of the Judicial Interpretation of Private Lending, according to this, it is confirmed that Huasheng Company signed the" Commercial Housing Sales Contract "with outsiders Ted Company and Ping Jing and registered the commercial housing presale in the name of the outsider to provide guarantees for debts. Atypical guarantees are established between the parties. Jinxinyuan Company can have the right to apply for auction of 82 sets of commercial housing provided by Huasheng Company for filing and registration within the scope of the 16.5 million yuan debt involved in the case that Unisea Company fails to repay on schedule, the realization of the claim on the price received." Although the decision recognized that the "net sign guarantee" was an atypical guarantee, it made it clear that "the atypical guarantee, rather than the concession guarantee, does not produce the priority effect of the property right". 3. for the provision of "guarantee" of the house, whether the advance registration does not constitute a concession and guarantee, whether to enjoy the right of priority compensation there is a certain dispute. The author has summarized the main points of several relevant cases that have been determined to constitute a concession and guarantee, and analyzed them as follows: (I) Zeng Fuyuan and Hunan Xinguo Real Estate Development Co., Ltd. Contract Dispute Case [(2019) Supreme Famin No. 304]] The main purpose of the judgment: if the security has been actually delivered to the creditor or the security has been changed and registered in the name of the creditor, and the publicity of the change of property rights has been completed, the creditor's status as the owner shall be denied according to the interpretation rule of "lifting weights to be clear and light", the validity of the security real right of the transfer and guarantee shall be recognized to a limited extent, and the creditor's right to receive the preferential payment of the price of the proceeds from auction, it is not only a respect for the autonomy of the parties, but also does not cause damage to the interests of other creditors of the debtor, reflecting the core value of the contract of transfer and security of the interests of both parties. After the establishment of the legal relationship between Xinguo Company and Zeng Fuyuan, the act of registering the advance purchase of commercial housing with the Contract for the Sale and Purchase of Commercial Housing constitutes the legal relationship between the concession and the guarantee contract. (II) Fang Ping's Case of Objection with Ji Zhongen and Liaoyang Longde Real Estate Development Co., Ltd. [(2019) Supreme Fa Min Shen No. 1832]] The main point of the judgment: Fang Ping recognized that the commercial housing sales contract signed with Lund Company was to guarantee the performance of Lund Company's debt of 10 million yuan borrowed from it, that is, the real intention of both parties was to provide guarantee for the loan between both parties with the house involved in the case. Fang Ping was not the real buyer of the house involved in the case, and both parties did not have a real housing sales relationship, but a guarantee legal relationship. The security right holder may participate in the distribution of the auction sale price of the security, claim priority payment to protect its legitimate rights and interests, but cannot exclude enforcement. (III) Hunan Loudi Jiancheng Real Estate Co., Ltd. and Li Xiaoling Bankruptcy Creditor's Rights Confirmation Dispute [(2019) Xiang Min Zhong No. 870]] The main point of the judgment: Jiancheng Company and Li Xiaoling signed the "Commercial Housing Sales Contract". After registering the 15 houses involved in the case in advance, Jiancheng Company cannot sell the houses involved in the case again or set up other rights. Therefore, the advance registration has exclusive effect and plays a certain role in publicizing changes in property rights. At present, Xianghua Company has not paid off its debts at maturity, and the creditor Li Xiaoling may enjoy the priority right of payment of the proceeds of the disposition of the house involved in the case by reference to the provisions of the law on security interests. Through the above-mentioned jurisprudence, it can be interpreted that after the registration of the house that will provide the guarantee, although the creditor does not have ownership of the house in question, but the proceeds of the disposition of the house in question have the right of priority compensation. However, some scholars and practitioners hold different views on this, that the completion of the change of property rights is one of the constituent elements of the transfer and security, only to meet the full constituent elements of the transfer and security can be called the transfer and security. With reference to the system of advance notice registration of real estate mortgage, the above situation is not enough for transfer and guarantee, that is, the advance notice registration of real estate mortgage cannot produce the legal effect of mortgage establishment, and cannot produce the legal effect of creditors enjoying the priority right of compensation to the mortgage. With reference to the real estate mortgage contract, even if the advance notice registration is made, it will not produce the effect of ownership change. The registration of housing advance notice is not the same as the registration of housing property rights, does not make the change of ownership of the house registered to the creditor's name, even if the advance notice registration does not constitute a concession and security, the lender (creditor) can not rely on this to buy and sell the subject matter of the contract of sale, sale, discount payment priority. Through the above analysis, it can be seen that the "net sign guarantee" which widely exists in the field of private lending is not the operation mode of legal real right guarantee in China. It is difficult for the lender (I. e. creditor) to realize the role of guarantee. The lender should fully consider the risks and treat it with caution.</中华人民共和国民法典>

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