Liability Of Mortgagor For Unregistered Real Estate Mortgage

As an important system to ensure the security of creditor’s rights,guarantee plays an important role in civil and commercial activities,and real estate mortgage has become one of the most common guarantee methods because of its high value and stability.In order to ensure the security of transactions,the establishment of real estate mortgage rights,which is a security right,must have a characteristic that can be recognized by a third party.That is,the mortgagor and the creditor must jointly apply to the registration authority for mortgage registration,and the registration authority will assign the mortgage right.The establishment situation is recorded in the book to complete the publicity.However,in judicial practice,unregistered real estate mortgages has often led to many legal disputes between civil entities.Article 46 of the "Interpretation of the Guarantee System of the Civil Code" is commendable for its response to some of the practical aspects of the "liability of the mortgagee in the event of an unregistered mortgage on immovable property".However,the following shortcomings remain: On the one hand,the provision is limited in its application to "failure to perform" and there is no mention of the remedies available when a mortgage contract on immovable property can still be performed,which is still a legal gap.On the other hand,the nature of the mortgagor’s liability is unclear.The specific content arrangement of this article includes:The first part is a historical review of the legal consequences when a mortgage on immovable property is not registered.Taking the implementation of the "Property Law" as the boundary,the legal consequences of the unregistered mortgages on immovable property can be broadly divided into two stages: In the first stage,according to the "Guarantee Law",the mortgage and the mortgage contract are dealt with together.The validity of mortgage contracts is related to whether it is registered or not,and in practice the mortgagor is usually not liable,liable for contractual negligence and liable for guarantee responsibility after conversion.The "Guarantee Law Interpretation" provides for the liability of the mortgagor in order to alleviate the embarrassment caused by the above-mentioned law,which provides a remedy for creditors,but is still inadequate.In the second stage,according to the principle of distinction of the Property Law,whether the creditor or the debtor is registered or not is not the key factor to determine the validity or invalidity of the mortgage contracts.Judicial decisions are mostly reflected in the fact that the mortgagor is liable for breach of contract or guarantee.The "Civil Code" is in the same line,and the "Interpretation of the Guarantee System of the Civil Code" provides for partial liability in the event of failure to perform,which is a major step forward.The second part discusses the nature of the mortgagor’s liability when the mortgage of real estate is not registered.From the theoretical point of view,it sorts out various viewpoints,analyzes and demonstrates the rationality of "theory of responsibility for breach of contract".The study finds that: Firstly,the "contractual negligence liability theory" has lost the premise and necessity of application under the current legislation.Secondly,the "atypical security liability theory based on mortgage contract" has overstepped the legal principle of autonomy for creditors through the application of default liability.Thirdly,there is no doctrinal basis for the theory of "liability under conversion" in our country,and it does not meet the requirements in terms of the constituent elements.Therefore,when a mortgage on immovable property is unregistered,the mortgage contract is valid and the mortgagor is liable for breaching the contract in accordance with the provisions of the "Civil Code" and the "Interpretation of the Guarantee System of the Civil Code",which are both legal and reasonable.The third part discusses the specific issue of the mortgagor’s responsibility when the mortgage of real estate has not been registered.The mortgagor assumes the liability for breach of contract on the premise that the mortgage contract is valid and the mortgage right has not been registered.The creditor may request the mortgagor to assume the following responsibilities: Firstly,continue to perform that is to assist in completing the mortgage registration,on the premise that the creditor files a complaint and the mortgage contract can still be performed.There is no order of priority between damages and continued performance and the court should respect the choice of the parties.Secondly,damages are subject to the creditor’s claim,the existence of damage and causes attributable to the mortgagor itself.If the principal debtor does not pay all the debts within the period of performance as agreed,the mortgagor may pay for the remainder to the extent of the actual value of the collateral,and may recover.The civil party may set a default clause in the mortgage contract in advance and the court shall respect this autonomy.