A Study On The Conflict Of Rights Of Real Estate First Mortgaged And Then Leased Out

Leasehold is a right from a lease contract to allow the lessee possess and use the leased property.Mortgage right is a right to sell the mortgaged property and get the payment in priority,which controls the exchange value of the collateral without possession of that.Therefore,the mortgage right does not affect the mortgagor to lease the mortgaged property.If the leasehold is created before the mortgage,the lease relationship shall not be affected by the realization of mortgage according to Article405 of the PRC Civil Code.However,conflicts happen when the mortgage is established beforehand because the leasehold will undoubtedly affect the price of the mortgaged property.The conflict is particularly common and typical in the case of mortgages on real estate.However,there are many divergences between judicial practice and academic theory when dealing with the conflicts.In view of this,the paper attempts to study the relevant legal issues,in order to properly coordinate the relationship between the mortgagee and the tenant and balance the interests between the two.The paper expands from the following four parts:In the first part,the paper will raise relevant legal issues by the introduction of typical judicial cases.The four judicial cases introduced in the part prove that there are huge differences in judicial practice.By analyzing the four typical cases,the paper summarizes three major problems:How to judge the sequence of the leasehold and the mortgage,whether the leasehold must be removed when the right of mortgage is realized and how to protect the interests of the lessee.The second part concentrates on the standard of judging the sequence of real estate mortgage and leasehold.As the former right creates only when it is registered,there is no time difference between the publication and the creation of the right,so the part mainly discuss the judgment standard of the leasehold.The part points out the shortcomings of taking the time when the lease contract is established or the time when lessee takes possession of the leased property,as the standard respectively.In the future,when the registration system of house lease is mature and universal in China,the time of registration of lease contract shall be regarded as the criterion of judgment.The third part discusses whether the leasehold must be removed when the mortgage is realized,and by whom and in what way.Regarding the question of whether the leasehold is necessarily removed,the part sorts out the contradictions and controversies in judicial interpretations and theories on this issue.Then,by clarifying the articles of law,taking the method of benefit measurement and borrowing ideas form comparative laws,the paper demonstrates the rationality of the view that removes the leasehold when it effects the mortgage adversely.On this basis,the paper analyzes the methods of taking appraisal price,or the results of the first auction,or comparing the prices of two auctions as the standard to measure the existence of unfavorable effects.And proposes to judge the existence of that by combining the evaluation with the results of the first auction.In view of the subject and way of removing the lease right,the part sorts out the viewpoints and practices from the academic and practical field respectively under the two different situations of the contract realization of mortgage and the compulsory realization of that.After that,the paper puts forward the viewpoint that the leasehold should not be removed by private power,but should be removed by the court ruling.The fourth part analyzes the protection of lessee's interests after the leasehold is removed.The part discusses whether the lessee has the right to bring an action against the execution and whether the mortgagor should bear the liability for compensation and whether the lessee can postpone to move the house.As for the first question,after sorting out the differences in academic principles and various practices,the part demonstrates that the lessee can raise an action of execution objection in specific circumstances.In regard to the second question,the part holds that the mortgagor(lessor)should be liable for breach of contract because of failing to maintain the real estate in suitable condition for lessee,and bear the liability for negligence in contracting when he fails to disclose the mortagage information.The part also puts forward that only the ordinary lessee has the right to claim the liability of warrant for defects.Commercial lessee's ignorance of the mortgage registration information does not constitute good faith,so they have no right to claim that.With respect to the third question,the part proves the rationality of the establishment of delay-moving-house institution through the analysis of practical cases.