Study On Pledge Of The Contract Creditor’s Rights

The whole dissertation is divided into six chapters.Chapter I mainly states the fundamental principle of the pledge system of contract creditor’s rights. It first states the concepts and features of the pledge system of contract creditor’s rights. It points out that the obligatory right, as the object of the pledge, is of negotiability. The obligatory right is a sort of claim with property content, and the pledge of obligatory right is essentially a sort of security containing property benefits. And then, this chapter generalizes the evolution of the pledge system of contract creditor’s rights. It insists that the ancient Rome law has set up the pledge system of contract creditor’s rights, while the ancient Germanic law lacked the possibility of pledge of obligatory right. The modern countries with civil law system inherited ancient Rome law and established respectively their pledge system of contract creditor’s rights. England, one of modern countries with Anglo-American law tradition, excludes the direct pledge system of obligatory right, resulting from its adhering to the idea that pledge must be set on condition of delivery of the hostage, while the United States of America admits the pledge system of contract creditor’s rights. The contemporary security law has changed in idea from exchange value into earning-capacity value. The rise of obligatory right in importance and the boom of financing guarantee have brought about the prosperity of the obligatory right pledge. The pledge of contract creditor’s rights can well balance the interests between creditors and debtors, meet the financing needs of enterprises, and greatly promote the economic efficiency of the whole society. In nature, the general pledge of obligatory right is set on the obligatory right, and doesn’t mean the transferring of this obligatory right. This kind of mortgage is a controlling power upon the pledged obligatory right, not a pure right of obligatory claim for the third debtor. The pledge of obligatory right is the combination of instrumental obligatory right and the intentional obligatory right.Chapter II discusses about the object of pledge of the contract creditor’s rights. The contract creditor’s rights can be act as the object of pledge on the condition of its propertization and its negotiability. The fact that the obligatory right functions as the object of the real right clear away its theoretic barrier. The rise of importance of obligatory right in modern life provides it with social situations. The breakthrough of the traditional privity theory of obligatory right creates its realizing conditions. There are two conflicting points about whether the obligatory right can be pledged. The negative theory bases on its big risk and poor potency of publication. But this article thinks that the commercial risk of the pledge should be undertaken by the relevant parties, while the legal risk and its poor publicity can be controlled by means of perfecting corresponding regulations. Although the risk under the pledge of contract creditor’s rights is indeed bigger than that of real thing security, its function of protecting the interests of the creditors shouldn’t be overlooked. So the positive theory should be insisted in order to confirm the pledge of contract creditor’s rights, and to respect the parties’free will. The object of the general pledge of obligatory right differs from that of negotiable securities, and the criterion of distinguishing is whether the warrant is divisible or negotiable. The obligatory right fit for pledge should belong to those valid, negotiable and property obligatory right. As for the efficacy of pledged obligatory right which is revocable, it is valid on the condition that the right of rescission is enjoyed by the pledgor, considering that he has been deduced by law to abandon his right of rescission after he had pledged. If the right of rescission belongs to the third debtor, the efficacy of pledge depends upon whether the third debtor has received the information of pledge and how he has responded. The obligatory right exceeding limitation of action can be pledged on the condition of creditor’s approval, and as a result, the pledge should undertake the risk of failing to realize his claim where it is subject to the defense of the third debtor. The potential obligatory right can also act as the object of pledge, for that the oblgee cares about the value of thing pledged, not where the pledge establishes, but where the pledge is realized. In the end, this chapter probes into whether the obligatory right can be pledged where there exists the stipulation of forbidding transferring obligatory right. In the view of comparative law, there are three legislation examples about the states of efficacy for the third party, that is, being invalid, valid, and incapable to confront the third party in good faith. This article insists that the legislation example of confrontation effect deserves to adopt.Chapter Ⅲ quests for the establishment of the pledge of contract creditor’s rights. The first question is about the contract of pledge of obligatory right. As for its feature, in the pattern of expressionism and formalism, it should be defined as a contract for credit, but a contract for real right in the pattern of real right formalism. Our real right law has admitted the independence of real right behavior, so in China, the contract of pledge of obligatory right should be qualified as a contract for real right. In form, the contract of pledge of obligatory right should be in written form, but this formal requirement can not be considered as the request of validity, but as a testifying function. In content, this contract should include explicit intention of pledge, exact description of the pledged obligatory right, and informing affairs for the third debtor. The contract should stipulate the exercise period of pledge of obligatory right, but should not stipulate fluidity clause. The second question is about the information of pledge. The information of pledge is an important protection mechanism for the pledge and the third debtor, which is not only a setting requirement of the pledge, but also a valid requirement of pledge for confronting the third debtor. The informing of pledge should be regarded as a basic obligation of the pledgor, and at the same time, the pledge will be granted to inform the third debtor if necessary in order to protect his interests. The receiver of information of pledge is the third debtor, and different third debtors should be treated according to different kinds of pledged obligatory right. The forms of informing should not be restricted within some special ones, but they should at least consist of the information of the pledgor and pledge, the declaration of will of pledge, the definition of the specific pledged obligatory right, and other necessary clauses. This chapter also analyses the efficacy of informing pledge, respectively for the pledgee, the third debtor and pledgor himself. The third question is about delivering the document of obligation. The document of obligation characterizes as a testimonial paper for obligatory right, and it can not stand for the obligatory right itself. The pledgor should deliver the document of obligation in the pledge of obligatory right, which is not an essential of establishment for the pledge of obligatory right, but functions merely in realizing this pledge right. The fourth question is about the publicity of the pledge of obligatory right. The civil law system confirms three kinds of forms of publicity, e.g. informing the third debtor, delivering document of obligation and registering. But the Anglo-American law system adopts mainly registering of declaration. Generally speaking, this article suggests that in China, the pledge of obligatory right should choose the informing the third debtor as its basic form of informing, and take the delivering document of obligation as a reinforcing form of publicity. The form of registering is ill-adapted to the current legal system or Chinese situation. The fifth question is about the bona fide acquisition of pledge of obligatory right. It is possible and necessary for the bona fide acquisition to apply to the pledge of obligatory right. Where the third debtor raised no definite objection to the false obligatory right pledged upon receiving the information of pledge, and the pledgee mistook it as a real obligatory right, it constitutes a basic requirement for the bona fide acquisition of the pledge of obligatory right. The efficacy of the bona fide acquisition of the pledge of obligatory right lies in that the pledgee can acquire the pledge and legal protection. The third debtor is obliged to clear off his debt within the scope of pledged or guaranteed obligatory right, and then to pursue the party who has pledged the false obligatory right. The pledgor should compensate for the loss or damage suffered by the pledgee or the third debtor which resulted in the pledgor’s pledging his false obligatory right with obvious fault.Chapter IV probes into the protecting regulations for the relevant parties in the pledge of obligatory right. In the pledge of obligatory right, what the pledgee cares much about is the control over the pledged obligatory right and realization of the pledge, while the third debtor expects to avoid suffering from the loss of interests innocently, and the common third party cares mainly about the potential trade security. The basic train of thought of interest protection for respective parties is to construct interest balance mechanism. This chapter focuses on the interest protection for the pledgee and the third debtor, which mainly contains three aspects as follows:the first is the pledgor’s liability for warranty against defects for the pledged obligatory right; the second is the pledgee’s preservative right of the pledge for obligatory right; the third is the pledgee’s priority of compensation. The basic principle of protecting the third debtor’s interest is that the third debtor must not suffer from the pledge of obligatory right resulting from the transaction between the pledgor and the pledgee. The third debtor can exercise all the deraignments against the pledgor by the pledee before receiving the information of pledge, except that he has explicitly renounced the deraignment or undoubtedly recognized the pledged obligatory right. At the same time, in accordance with the conditions, the third debtor may claim for right of set-off in respect to the pledged obligatory right, which, of course, should be put into proper limitation for the sake of interest balance. This chapter also discusses the way the third debtor claims for right of set-off and other relevant questions. When the pledged obligatory right is disposed multiply, the third debtor should not bear the additional performing expenses. Furthermore, American joint action mechanism can be used for reference in order that the interested creditors can participate to propose their claims by means of necessary joint action, so as to avoid suffering from multiple action burden.Chapter V discusses about the realization of the pledge of contract creditor’s rights. The realization of the pledge of contract creditor’s rights must accord with the prerequisite that the host obligatory right guaranteed has not yet satisfied on the appointed date. Besides, it should be put into the consideration whether the pledged the obligatory right has matured. The succession of the above mentioned time limits has significant influence on realizing the pledge of obligatory right. Moreover, the pledge of contract creditor’s rights can be exceptionally fulfilled in the some special situations. The fulfilling methods of the pledge of contract creditor’s rights include appraising at the current rate and directly collecting the obligatory right, with the latter in the first place. If what the pledgee has directly collected is the monetary obligatory right, it may be used to satisfy the host obligatory right. If it belongs to other tangible properties, the pledgee will continue to possess the right of pledge or mortgage upon this property. On the basis of the feature of the general pledge of obligatory right, when the host obligatory right reaches its expiration limit, but the pledged obligatory right does not reach its expiration limit, the pledgee may advocate directly to the debtor the collection of the common property without waiting till the expiration limit of the pledged obligatory right. Where the conditions of realizing the pledge are accomplished, and if neither the debtor nor the third debtor has performed his debt, the pledgee is entitled to request the debtor, the pledgor or the third debtor to undertake joint liability for the amount of obligation guaranteed. Where the pledged obligatory right has reached its expiration limit of repayment, but the host obligatory right has not reach its expiration limit of repayment, the third debtor should obtain the approval of the other party when he performs obligation to either the pledgor or the pledgee. Where the both creditor rights have reached the expiration limit of repayment, the third debtor may directly perform his obligation to the pledgee without obtaining the pledgor’s approval. The party in bankruptcy has great influence on the realization of the general creditor’s rights pledge. This article analyses and discusses the special regulations differing from those normal conditions for the realization of the creditor’s rights pledge in respective situations of the pledgee bankruptcy, the debtor/the pledgor bankruptcy and the third of the debtor’s bankruptcy and so on. Finally, the article analyzes some special circumstances which affect the realizition of general creditor’s rights pledge, including the influence of reduplicate guarantee of the pledged creditor’s rights on the creditor’s rights pledge, the influence of the coexistence of the general creditor’s rights pledge with other security patterns on the liability distribution, the influence of the performance defense in the bilateral contract on the contractual creditor’s rights pledge, the influence of the debt confusion on the general creditor’s rights pledge, and so on.ChapterⅥ is the reflection on perfecting Chinese pledge system of contract creditor’s rights. It is not only the summary of the article’s complete content, but also the conception of establishing Chinese pledge system of contract creditor’s rights. This chapter first makes comment on our current pledge system of contract creditor’s rights, including the Security Law and the Real Rights Law. It thinks that the Security Law holds an obscure attitude towards the pledge system of contract creditor’s rights, which made no specialized stipulation for it, but did not close the door for this type of pledge system. The Real Rights Law, based on the Security Law, added the pledge of accounts receivable, and enlarged greatly the scope of the pledge of contract creditor’s rights. But its overall provision about the objects for pledge of rights thoroughly eliminated other types of pledge of contract creditor’s rightss unlisted. In the light of these comments, this chapter puts forward specific conception about perfecting Chinese pledge system of contract creditor’s rights. From the view of legislation design, the writer proposes, in accordance with strict classification of property rights, to recombine all property rights which can be pledged, and to adjust the content of Article223in the Real Rights Law. The first paragraph of Article223should stipulate explicitly that the certificate of deposit, the accounts receivable, and other contract creditor’s rights, which are legally negotiable, may be pledged, so that the pledge of contract creditor’s rights is overall recognized. In respect of the regulation design, the writer advocates that the parties should conclude a contract in writing to establish a pledge of contract creditor’s rights through, with informing the third debtor as an essential of the pledge, and that the pledgor should perform his obligation to deliver the document of creditor right if the obligatory right pledged is embodied in document, and that the rights and obligations of the pledgor, pledgee and the third debtor should be explicitly stipulated in the pledge of contract creditor’s rights. As for the supporting system, this article advocates that it is necessary to strengthen the construction of our credit system, to perfect the mechanism of exchange of the creditor rights, and to optimize the deposit system.