Research On The Legal Nature Of Title Retention

The modification of title retention in the Civil Code adopts a legislative model that combines formalism and functionalism,resulting in the nature of title retention becoming blurred and causing related effects within and outside the Civil Code system.Therefore,it is necessary to re-interpret the nature of title retention within the current legal framework.There are three approaches to interpreting title retention.The first is the ownership theory,which asserts that the seller retains full ownership of the goods until the purchase price is fully paid.The second is the security interest theory,which regards title retention as a form of secured transaction,where the seller’s interest in the goods serves as collateral for the unpaid purchase price.The third approach is the hybrid theory of security interest ownership,which lies somewhere between the other two theories and sees title retention as a form of hybrid property right that has both ownership and security interest elements.However,the latter theory is still lacking a coherent explanation within the current system of property law.In the context of statutory relaxation of property rights law,the view of "functioning of ownership as security interests" is still excluded from the security interest system in the Civil Code,and there are essential differences in attributes and implementation methods compared with security interests.In terms of attributes,title retention does not have the subrogation attribute and material substitution of security interests,while in terms of implementation methods,the seller retaining ownership can both "refer to the implementation procedure of security interests" to recover the subject matter and request the return of the original property by terminating the contract.The retention of ownership by the seller has not been emptied as a mere formality,and its potential for complete ownership can be explained by theories of power separation and elasticity of ownership.The new registration-against system added in the Civil Code plays a role in enhancing the appearance of non-possessory ownership rights and maintaining transaction security,but it cannot link title retention with the concept of security interests through the registration-against system.According to the ownership-based theory,the legal structure of title retention is that ownership of the subject matter is attached to a condition suspending delivery,in which the seller retains the right to recover possession until the buyer pays the remaining price or completes certain conditions.The seller’s right to recover possession is a right to claim possession of the subject matter,which can be exercised through negotiation,non-litigation,or litigation procedures.The use of the "application of security rights implementation procedures" is only a legislative technique.On the contrary,if title retention is interpreted as a security-based theory,it cannot explain the unique setting of the seller’s right of recovery and redemption,nor can it complete the legal structure of title retention.Under the theory of ownership,the system of retention of title should improve the public notification system,establish diversified ways of public notification to distinguish the registrability of the subject matter,and improve the electronic registration system for people.The bankruptcy law and civil litigation related systems should be connected to the Civil Code and relevant judicial authorities,and the rights of the parties to the retention of title in bankruptcy and forced execution should be handled from the perspective of formalism interpretation theory.Since the ownership of the subject matter has not been transferred and the price claim has not been settled,the retention of title contract should be considered as an unfulfilled contract.When the parties to the retention of title contract are bankrupt,their bankruptcy administrator should have the limited right to decide whether to continue performing the contract.When the parties to the retention of title are subject to forced execution,the path for the seller to realize the right to claim is to object to the execution object or apply for priority payment rights.The purchaser can choose to continue performing the contract or terminate the contract for liquidation.If they choose to continue performing the contract,they should continue to pay the price according to the contract.