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  • Interpretation
  • No.304【Under Translation】
  • Date
  • 1992/08/14
  • Issue
    • Do the proviso to Article 866 of the Civil Code and J. Y. Interpretation Yuan-tze No.1446, which maintain that superficies or other rights to use and collect benefits created after the registration of a mortgage should not affect the mortgagee’s right, contradict the people’s property rights guaranteed by the Constitution?
  • Holding
    •        Article 866 of the Civil Code stipulates that, “After the creation of a mortgage, the owner of a real property may create superficies and other rights on the same real property provided that the mortgage shall not be affected thereby.” If the mortgage is affected because of the creation of superficies or other rights, according to J. Y. Interpretation Yuan-tze No. 1446, such superficies or rights shall not be effective against the mortgagee, and the Enforcement Court can directly enforce the execution of an auction for the mortgaged real property upon the mortgagee’s application. Because the mortgage is a right over things and will become public upon registration, the superficies or other rights to use and collect benefits on the mortgaged real property, which were obtained after the registration of the mortgage, shall not affect the mortgage registered prior to such superficies and rights. Such superficies or other rights to use and collect benefits may continue to exist if neither affects the mortgage. The rights of the one who obtains such superficies and other rights after the registration of the mortgage have been taken into consideration. Thus, the aforesaid Article 866 of the Civil Code and J. Y. Interpretation Yuan-tze No. 1446 do not contradict the Constitution.
  • Reasoning
    •        Article 866 of the Civil Code stipulates that “After the creation of a mortgage, the owner of a real property may create superficies and other rights on the same real property provided that the mortgage shall not be affected thereby.” If the mortgage is affected because of the creation of superficies or other rights, according to J. Y. Interpretation Yuan-tze No. 1446, such superficies or rights shall not be effective against the mortgagee, and the Enforcement Court can directly enforce the execution of an auction for the mortgaged real property upon the mortgagee’s application. Because the mortgage is a right over things and will become public upon registration, the superficies or other rights to use and collect benefits on the mortgaged real property, which were obtained after the registration of the mortgage, shall not affect the mortgage registered prior to such superficies and rights. If the mortgage is affected by the superficies or other rights to use and collect benefits which were created by the owner on the mortgaged real property after the creation of the mortgage, and where the mortgagee applies for the auction of the mortgaged real property, and no person proposed a purchase, or where the proposed purchase price is insufficient for the repayment of the claim secured by such mortgage, the Enforcement Court shall then enforce an auction by removing said rights and, after the real property is auctioned, release the possession of the party whose rights had been removed to the buyer.This is necessary for the mortgagee to be repaid in the same status as when the mortgage was created. In contrast, such superficies or other rights to use and collect benefits will continuously exist where neither of these affects the mortgage. The rights of the one who obtains such superficies and other rights after the registration of the mortgage have been taken into consideration. Thus, the aforesaid provision in Article 866 of the Civil Code and J. Y. Interpretation Yuan-tze No. 1446 do not contradict the principle of the protection of the people’s rights under the Constitution.
      
    • *Translated by John C. Chen.
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