1896de Book3 Chapter09 Title01
From Thai Codification Codes of 1925
- Based on the English Translation by: Wang, Chung Hui (1907). The German Civil Code, translated and annotated with historical introduction and appendices. London: Stevens and Sons. [available on Archive.org]
- Original Version in German.
Book III. Low of Things.
Chapter IX. Pledge of Moveables and of Rights.
Title I. Pledge of Moveables.
- [I] A moveable may, for the securing of a claim, be charged in such manner that the creditor is entitled to seek satisfaction out of the moveable (i.e., a pledge).
- [II] A pledge may also be granted as a security for a future or a conditional claim.
- [I] For the grant of a pledge it is necessary that the owner deliver the thing to the creditor and make a real agreement with him to the effect that the pledge shall belong to the creditor. If the creditor is in possession of the thing, a real agreement as to the creation of the pledge is sufficient.
- [II] The delivery of a thing which is in the indirect possession of the owner may be replaced by the owner transferring the indirect possession to the pledgee and notifying the pledge to the possessor.
- Instead of delivery of the thing the creation of joint possession is sufficient, if the thing is in the joint custody of the creditor; where it is in the possession of a third party, its delivery can be made only to the owner and the creditor jointly.
- If the thing does not belong to the pledgor, the provisions of 932, 934, 935, applicable to the acquisition of ownership, apply mutatis mutandis to the grant of a pledge.
- If the thing is charged with a right of a third party, the pledge takes priority to such right, unless the pledgee, at the time of acquiring the pledge, was in bad faith as against such right. The provisions of 932, par. 1, sentence 2, 935, and 936, par. 3, apply mutatis mutandis.
- The rank of a pledge is determined by the date of its grant, even if it was granted as a security for a future or a conditional claim.
- [I] The thing pledged is liable for the claim in the condition in which it is at the time of the assertion of the right of pledge, as, e.g., for interest and stipulated penalties. If the personal debtor is not the owner of the thing pledged, the liability is not increased by any juristic act which the debtor enters into after the creation of the pledge.
- [II] The thing pledged is liable for the claims of the pledgee for reimbursement of outlay, for the costs of notice and of legal process to be repaid to the pledgee, and also for the costs of a sale of the thing pledged.
- [I] The pledgor may set up as against the pledgee any defences which the personal debtor has against the claim, and also any defences which a surety has under 770. If the personal debtor dies, the pledgor may not avail himself of the fact that the heir has only a limited liability for the debt.
- [II] If the pledgor is not the personal debtor, he does not lose a defence through its waiver by the latter.
- The pledge extends to products which are severed from the thing pledged.
- [I] A pledge may be granted in such manner that the pledgee is entitled to draw the emoluments of the thing pledged.
- [II] If a thing which naturally bears fruit is delivered to the pledgee for his sole possession, it is to be presumed, in case of doubt, that the pledgee is entitled to take the fruits.
- [I] If the pledgee has the right to draw the emoluments, he is bound to take care to secure the emoluments and to render an account.
- [II] The net proceeds of the emoluments shall be applied towards the satisfaction of the principal claim; but where costs and interest are to be paid, the net proceeds shall first be applied to the payment of the costs and interest.
- [III] Different provisions are permissible.
- The pledgee is bound to take the pledged thing into his custody as though he were a depositary.
- If the pledgee incurs any outlay upon the thing pledged, the pledgor's duty to make reimbursement is determined according to the provisions relating to management of affairs without mandate. The pledgee is entitled to remove an attachment with which he has provided the thing pledged.
- [I] If the pledgee violates the rights of the pledgor to a serious extent, and if he continues to do so in spite of a remonstrance of the pledgor, the pledgor may require that the thing pledged be lodged at the expense of the pledgee, or if it is not suitable for lodgment, that it be delivered to a custodian appointed by the Court.
- [II] Instead of lodgment or delivery of the pledged thing to a custodian, the pledgor may require the return of the thing pledged on satisfaction made to the creditor. If the claim does not bear interest and is not yet due, the pledgee is only entitled to the sum which, with addition of statutory interest from the time of payment to maturity, would equal the amount of the claim.
- [I] If the destruction of the thing pledged or a serious diminution of its value is to be apprehended, the pledgor may require the return of the thing pledged upon giving security in some other manner; the giving of security by sureties is excluded.
- [II] The pledgee shall, without delay, notify the pledgor of the threatened destruction, if such notice is practicable.
- [I] If the security of the pledgee is endangered by the threatened destruction of the thing pledged, or by an apprehended serious diminution in its value, he may cause the thing pledged to be sold by public auction.
- [II] The proceeds take the place of the thing pledged. On demand by the pledgor the proceeds shall be lodged.
- [I] The auction sale of the thing pledged is permissible only after the pledgor has been warned of it; the warning may bo dispensed with if the thing pledged is liable to be destroyed and there is danger in delaying the auction. In the case of a diminution in value it is necessary, beside the warning, that the pledgee shall have fixed a reasonable period for the pledgor to give further security, and that the period shall have elapsed.
- [II] The pledgee shall without delay notify the pledgor of the auction sale; if he fails to give such notice he is bound to make compensation.
- [III] The warning, the fixing of a period, and the notice may be dispensed with if they are impracticable.
- If the thing pledged has an exchange or market price, the pledgee may make the sale privately at the current price by a broker publicly empowered to make such sales or by a person authorised to hold public auctions.
- If a pledge exists over several things, each is liable for the whole claim.
- [I] A pledgee is bound to return the pledged thing to the pledgor after the extinction of the pledge.
- [II] The pledgor may require the return of the thing pledged on satisfaction of the pledgee as soon as the debtor is entitled to make satisfaction.
- The satisfaction of the pledgee may also be effected by the pledgor by lodgment or set-off.
- If the pledgor is not the personal debtor, the claim passes to him in so far as he satisfies the pledgee. The provisions of 774 applicable to a surety apply mutatis mutandis.
- The claims of the pledgor for compensation on account of alterations or deteriorations of the thing pledged, and also the claims of the pledgee for reimbursement of outlay incurred and for permission to remove an attachment, are barred by prescription in six months. The provisions of 558, pars. 2 and 3, apply mutatis mutandis.
- If any right of the pledgee is violated, the provisions applicable to claims arising from ownership apply mutatis mutandis to the claims of the pledgee.
- [I] The satisfaction of the pledgee out of the thing pledged is effected by sale.
- [II] The pledgee is entitled to sell the thing pledged as soon as the claim is due in whole or in part. If the object owed is not money, the sale is permissible only if the claim has been transmuted into a money claim.
- An agreement made before the right to sell has arisen, whereby the ownership of the thing is to pass or is to be transferred to the pledgee if satisfaction is not made, or is not made in due time, is void.
- Among several things pledged the pledgee may, unless it is otherwise provided, select which are to be sold. He may put up for sale only so many of the things pledged as are necessary for his satisfaction.
- If the pledgee is not in sole possession of the thing pledged, he may, as soon as the right to sell has arisen, demand the delivery of the thing pledged for the purpose of sale. In lieu of such delivery, the thing pledged shall, on demand by the pledgor, be delivered to a custodian appointed by the parties Jointly; the custodian shall, upon acceptance of the thing, bind himself to keep it ready for sale.
- The pledgee is not bound to hand over to a pledgee subsequent to himself in rank the thing pledged for the purpose of sale. If he is not in possession of the thing pledged, and if he does not himself require the sale, he cannot prohibit the sale by a subsequent pledgee.
- [I] The sale of the thing pledged shall be effected according to the provisions of 1234 to 1240.
- [II] If the pledgee has acquired for his right to sell an executory title against the owner, he may also cause the sale to be effected under the provisions applicable to the sale of a judicially attached thing.
- [I] The pledgee shall warn the owner in advance of the sale, and shall at the same time specify the amount in money on account of which the sale is to take place. The warning may not be given until after the right to sell has arisen; it may be dispensed with if it is impracticable.
- [II] The sale cannot be made until the expiration of one month after the warning. If the warning is impracticable, the month is to be reckoned from the time when the right to sell arises.
- [I] The sale of the thing pledged is to be effected by means of public auction.
- [II] If the thing pledged has an exchange or market price, the provision of 1221 applies.
- The auction shall be held in the place where the thing pledged is in custody. If a reasonable result is not to be expected from the auction in the place of custody, the thing pledged is to be put up for auction in some other suitable place.
- The time and place of the auction shall be publicly advertised with a general description of the thing pledged. The owner and third parties who have rights in the thing pledged are especially to be notified; the notification may be dispensed with if it is impracticable.
- [I] The thing pledged shall be sold only subject to the condition that the purchaser has to pay the purchase price immediately in cash, and that he shall lose his rights if this is not done.
- [II] If the sale is made without such condition, the purchase price is deemed to be received by the pledgee; the rights of the pledgee against the purchaser remain unaffected. If the immediate payment of the purchase price is not made the same rule applies, unless, before the expiration of the day on which the auction is held, the right to declare a forfeiture of the purchaser's rights is exercised.
- [I] The pledgee and the owner may bid at the auction. If the pledgee is the successful bidder, the purchase price is deemed to be received by him.
- [II] The bid of the owner can be rejected if the amount is not tendered in cash. The same rule applies to the bid of the debtor, if the pledge is for the debt of another.
- [I] Things of gold and silver cannot be sold at the auction below the bullion value.
- [II] If a sufficient bid is not made, the sale may be made privately by a person authorised to conduct public auctions, at a price equal to the bullion value.
- The pledgee shall without delay notify the pledgor of the sale of the thing pledged and of the result of the sale, provided the notification is practicable.
- [I] By the legitimate alienation of the thing pledged, the acquirer obtains the same rights as if he had acquired the thing from the owner. This applies even if the pledgee is the successful bidder.
- [II] All rights of pledge over the thing are extinguished, even if they were known to the acquirer. The same rule applies to a usufruct, unless it has priority in rank to all rights of pledge.
- [I] The alienation of the thing pledged is not legitimate if it is in violation of the provisions of 1228, par. 2, 1230, sentence 2, 1235, 1237, sentence 1, or 1240.
- [II] If the pledgee infringes any other provision applicable to the sale, he is bound to make compensation if any fault is imputable to him.
- Where a thing is alienated as a pledged thing without the alienor having any right of pledge over it, or without satisfying the requisites upon which the legitimacy of the alienation depends, the provisions of 932 to 934, 936 apply mutatis mutandis if the alienation has been made in the manner provided for by 1233, par. 2, or if the provisions of 1235 or of 1240, par. 2, have been observed.
- [I] The owner and the pledgee may agree upon a method of selling the thing pledged varying from the provisions of 1234 to 1240. If a third party has in the thing pledged a right which is extinguished by the alienation of the thing, the consent of such third party is necessary. The consent shall be declared to the person in whose favour it is given; it is irrevocable.
- [II] The observance of the provisions of 1235, 1237, sentence 1, and 1240 may not be waived before the right to sell arises.
- [I] If a method of selling the pledged thing, varying from the provisions of 1235 to 1240, appears to be equitable, having regard to the interests of the parties, either of them may require that the sale be made by such method.
- [II] If an agreement is not formed, the Court decides.
- In so far as the proceeds of a sale of the thing pledged accrue to the pledgee in satisfaction for his claim, the claim is deemed to have been satisfied by the owner. For the rest the proceeds take the place of the thing pledged.
- In the sale of the thing pledged the pledgor is deemed, in favour of the pledgee, to be the owner, unless the pledgee knows that the pledgor is not the owner.
- A person who would lose a right in the thing pledged through its alienation may satisfy the pledgee as soon as the debtor is entitled to make payment. The provisions of 268, pars. 2 and 3, apply mutatis mutandis.
- [I] Upon the transfer of the claim the pledge passes to the transferee. The pledge cannot be transferred without the claim.
- [II] If, in the transfer of the claim, the transfer of the pledge is excluded, the pledge is extinguished.
- [I] The new pledgee may demand the delivery of the thing pledged from the former pledgee.
- [II] Upon acquisition of possession the new pledgee takes the place of the former pledgee in respect of the obligations towards the pledgor attached to the pledge. If he does not fulfil the obligations, the former pledgee is liable for any damage to be made good by him, as a surety who has waived the plea of beneficium excussionia. The liability of the former pledgee does not arise if the claim passes to the new pledgee by operation of law, or is assigned to him by reason of a statutory obligation.
- A pledge is extinguished upon the extinction of the claim for which it exists.
- [I] A pledge is extinguished if the pledgee gives back the thing pledged to the pledgor or to the owner. Any reservation in respect of the continuance of the pledge is ineffective.
- [II] If the thing pledged is in the possession of the pledgor or the owner, it is presumed that the thing pledged has been given back to him by the pledgee. This presumption applies even if the thing pledged is in the possession of a third party who has obtained the possession from the pledgor or the owner after the creation of the pledge.
- If there is a defence to the pledge whereby the enforcement of the pledge is permanently barred, the pledgor may require the return of the thing pledged. The owner has the same right.
- [I] For the termination of a pledge by juristic act, a declaration made by the pledgee to the pledgor or the owner to the effect that he gives up the pledge is sufficient.
- [II] If the pledge is charged with the right of a third party, the consent of the third party is necessary. The consent shall be declared to the person in whose favour it is given; it is irrevocable.
- [I] A pledge is extinguished if the ownership and the pledge merge in the same person. It is not extinguished so long as the claim secured by the pledge is charged with the right of a third party.
- [II] The pledge is deemed not to have been extinguished where the owner has a legal interest in the continuance of the pledge.
- The provisions relating to a pledge constituted by juristic act apply mutatis mutandis to a pledge created by operation of law.
- [I] If a pledge exists in the share of one co-owner, the pledgee exercises the rights which result from the community of the co-owners in respect of the management of the thing and the mode of its use.
- [II] Before the pledgee's right to sell arises, the dissolution of the community can only be required in common by the co-owners and the pledgee. After the right to sell has arisen, the pledgee can require the dissolution of the community without the consent of the co-owner being necessary; he is not bound by any agreement whereby the co-owners have excluded permanently or temporarily the right to require the dissolution of the community or have prescribed a term of notice.
- [III] If the community is dissolved, there is due to the pledgee the pledge in the objects which take the place of the share.
- [IV] The pledgee's right to sell the share remains unaffected.
- The special provisions of 1260 to 1271 apply to a pledge affecting a ship entered in the ship register.
- [I] For the grant of such a pledge a real agreement between the owner of the ship and the creditor that the pledge shall belong to the creditor, and an entry of the pledge in the ship register, are necessary. The provisions of 873, par. 2, and 878 apply mutatis mutandis.
- [II] In the registration must be stated the name of the creditor, the amount in money of the claim, and, if the claim bears interest, the rate of interest. For the detailed description of the claim, reference may be made to the authorisation for registration.
- The relative rank of pledges granted in respect of a registered ship is determined according to the provisions of 879 to 881 and 1151.
- [I] So long as a pledge is entered in the ship register it remains operative in the case of alienation or charging of the ship, even if the acquirer is in good faith.
- [II] If the pledge is wrongfully cancelled and the ship is alienated, the provisions of 936, par. 1, sentence 1, and par. 2 apply, even if the acquirer obtains the ownership without delivery; the provision of 936, par. 3, does not apply. If a pledge which is subsequent in rank to the pledge wrongfully erased is transferred to a third party, the provision of 1208, sentence 1, applies.
- [I] If the entries of the ship register in respect of a pledge are not in accord with the actual legal situation, the rectification of the register may be required according to the provisions of 894, 895, 897, 898 applicable to the rectification of the land register.
- [II] If a pledge has been wrongfully cancelled, an objection to the correctness of the ship register may be entered in the manner provided for by 899, par. 2. As long as the objection is entered, the same rule applies as against the acquirer in the case of alienation or charging of the ship as if the pledge were registered.
- [I] The liability of the ship is limited to the registered amount of the claim and interest according to the registered rate of interest. The liability for statutory interest and for costs is determined according to the provision of 1118 applicable to hypotheca.
- [II] If the claim does not bear interest, or if the rate of interest is lower than five per cent., the pledge may, without the consent of persons having rights of equal or subsequent rank, be enlarged to the extent that the ship is liable for interest up to five per cent.
- [I] A pledge affecting a registered ship extends to the accessories of the ship, with the exception of accessories which have not come into the ownership of the owner of the ship.
- [II] The provisions of 1121, 1122 applicable to hypotheca apply mutatis mutandis to the liability of the accessories.
- The provisions of 1205 to 1257 do not apply, in so far as modifications result from the fact that the pledgee does not obtain possession of the ship. In the case provided for by 1254 the right to require termination of the pledge takes the place of the claim for the return of the thing pledged.
- The pledgor may, upon satisfaction of the pledgee, require the issue of the documents necessary for the cancellation of the pledge. The personal debtor has the same right, if he has a legal interest in the rectification of the ship register.
- The pledgee may seek satisfaction out of the ship and its accessories only by virtue of an executory title according to the provisions applicable to compulsory execution.
- Where the creditor is unknown he may be excluded from his pledge by means of public summons, if the conditions prescribed in 1170 or in 1171 for the exclusion of a hypotheca creditor exist. Upon the issue of the decree of exclusion the pledge is extinguished. The provision of 1171, par. 3, applies.
- To the pledge for a claim arising from an obligation to bearer, from a bill of exchange, or from any other instrument which can be transferred by indorsement, the provisions of 1189, and to the pledge for a claim arising from an obligation to bearer, the provisions of 1188 also apply mutatis mutandis.
- [I] A pledge affecting a registered ship may be granted in such manner that only the maximum amount for which the ship is to be liable is specified, the determination of the claim being in other respects reserved. The maximum amount must be entered in the ship register.
- [II] If the claim bears interest, the interest is included in the maximum amount.
- The provisions of 1260 to 1271 apply also to pledge of a share in a ship.
