The Research On Constitutive Requirements Of Bona Fide Acquisition Of Chattel Real

To organize the procedure of bona fide acquisition from perspective of time,bona fide acquisition of chattel real shall have three constitutive requirements: aperson unauthorized to dispose realty or chattel has a rational right appearance ofreal right of chattel real; an assignee can transfer chattel real in good faith; thepublication of real right alternation has been completed.The first constitutive requirement of bona fide acquisition of chattel real is aperson unauthorized to dispose realty or chattel’s having a rational right appearanceof real right of chattel real. Subject to Article9of the Property Law, registration isthe publication method of real right alternation. Therefore, the publication of realright alternation is inoperative without registration. The Property Law also stipulatesthe date when the establishment and transference of real tight of general chattelscome into effect. Unless otherwise specified in the Law, real right alternation ofchattels shall come into effect from the time of delivery. However, in accordancewith Article24of the Property Law, delivery is the requirement of validity of realright alternation of chattels, and registration is a method of rivalry conditions toconfront bona fide third party. This can be called delivery’s coming into effect andregistration of antagonism. Due to the Article106of the Property Law is too generaland the particularity of chattel real, it is necessary to deeply analyze bona fideacquisition of chattel real. Right appearance of an assignor shall be the preconditionof the beginning of bona fide acquisition. Only with a right appearance that can betrusted by the assignee, can the assignee be in good faith and can bona fideacquisition be completed. Since Article24of the Property Law has given chattel realtwo methods of publication including delivery (possession) and registration, authorof this essay will summarize four types of right appearance, covering possession aswell as registration, possession but no registration, registration but no possession, nopossession and no registration. The assignor’s right appearance under thecircumstance of possession as well as registration is identical with the owner’s right appearance in chattel real transaction, so it is easier to identify that the assignee isbona fide acquisition. The assignor’s right appearance under the condition ofpossession but no registration only has one type of right appearance. In order toidentify the good faith of an assignee, certain conditions are required. Registrationbut no possession, no possession and no registration cannot generate bona fideacquisition. In conclusion, precondition for identifying bona fide acquisition ofchattel real is that the assignor shall possess the chattel real.The second constitutive requirement of bona fide acquisition of chattel real isan assignee’s transferring the chattel real in good faith. Bona fide can remedy thelogic defect that the assignor has no right to deal with his or her subjective matter.After measuring all parties’ legal interests, the Property Law chose to protect theinterests of bona fide assignee. If the assignee cannot be defined as bona fide, therewill be no bona fide acquisition. Bona fide means unknown not because of grossnegligence. Unknown not because of gross negligence means a subjective state thatthe assignee without negligence or with levissima culpa ignores the assignor’shaving no right to deal with realty or chattel. Under these circumstances, theassignee can be defined as bona fide, thus applying to bona fide acquisition system.If because of gross negligence, an assignee is fully aware of or not aware of theassignor’s having no right to dispose realty or chattel, the assignee is not bona fide.In a chattel real transaction, a rational bona fide assignee shall not only conductobligation of examine, but also duplicate documentary evidence provided by theassignor. Unlike that the original obligee needs to take burden of proof, assignee’sproof is not a compulsory duty. The transaction occasion selected by the party is asignificant standard to judge whether the assignee is bona fide. Besides, whether theassignor is with suspicious appearance and movements and whether the assignor andthe assignee are relatives can be regarded as references. Reasonable price isclassified into the second constitutive requirement, because in juridical practice,price factor is more as a consideration factor to facilitate the court to judge whetherthe assignee is bona fide. Because the chattel real has great economic value and thesame standard as general chattels to define what a reasonable price is, to determine aprofessional standard in all kinds of chattel real transaction field is a more reasonable method. What’s more, it shall be emphasized that the assignee has already paidsubjective matter’s price during the transaction. Another key factor to judge whetherthe assignee is bona fide is the criterion time of bona fide. When an assignor hasdelivered chattel real to an assignee, though real right alteration has happenedbetween an assignor and an assignee, real right alteration does not generate absoluterights, and cannot confront bona fides third party. The purpose of bona fideacquisition system is to maintain property protection and transaction safety and notonly the assignor’s and the assignee’s interests need to be protected, but also thirdparty’s interests. Therefore, when defining bona fide’s criterion time, it is necessaryto investigate whether bona fide can last to the registration time.The third constitutive requirement of bona fide acquisition of chattel real is thatreal right alternation has been completed. To terminate a complete and valid realright alternation, bona fide acquisition shall finish the publication. In considerationof the effects of publication of indicated delivery and possession reformulation isinsufficient; to deny the application of bona fide acquisition under these twocircumstances is beneficial to protect party’s and third party’s legitimate rights andinterests in the transaction and can facilitate to maintain transaction safety. Thoughthe assignee has possessed subjective matter, he or she has not completed bona fideacquisition. In addition, an assignor shall conduct change of registration for theassignee. After the assignee has become the registered oblige of subject matter, bonafide acquisition of chattel real has been completed in a real sense. Therefore, in reallife, a registered but not possessed assignee does not exist. Reality is the source ofmaterials for theoretical research. Since this sort of assignee does not exist, there isno need to discuss it in theory.