Some Issues Concerning the Realization of Property during an Enforcement Procedure
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Abstract
The article deals with some theoretical and practical issues concerning the auctioning of property of the debtor. Realization of property of the debtor is one on the main stages of an enforcement procedure, substantially influencing the success of an enforcement procedure as a whole. Consequently, the improper legal regulation of an auction can severely violate legal interests of the participants of the auction.
Article 708 of the CPC contains the provision that every interested person should be given an opportunity to inspect the property put up for sale prior to the action by rules determined by the bailiff. Existent legal regulation is, in the opinion of the author, insufficient. Taking into account the necessity to protect human rights and fundamental freedoms, an inspection of a dwelling-place of a debtor should be regulated in more detail, by establishing necessary limitations aimed to protect the privacy and respect for home of a debtor and its family members. If a debtor objects the inspection of its dwelling-place, potential purchasers should be given the opportunity to enter and inspect it only if the order of court to permit the entrance to the dwelling-place is presented. CPC should also fix an obligation of a bailiff to inform the debtor about the inspection of its dwelling place in advance.
Article 683 of the CPC should be supplemented by clearly fixing the right of a bailiff, in case if arrested mobile property is left in the possession of a debtor, to lay the debtor under obligation to ensure that interested persons will be able to inspect the property at the time indicated by the bailiff.
The right of a debtor to search for the purchaser of the property put up for sale up to the beginning of an auction, enshrined in Article 704 of the CPC, should as such be assessed positively. However, the mechanism for realisation of this right enables the debtor to misuse procedural rights and protract the recovery. The procedure applicable for the sale of property to a purchaser chosen by the debtor, if approval of such a sale by the notary is required by laws, should be simplified. In these cases the bailiff, upon the request of the claimant, should pass the order of definite form, including essential conditions of sale: term of contract, minimal price, and order of payment. Such a procedure of realization of property would enable a debtor to use possibilities of the market at that date and sell the property more profitable.
In the professional practice of bailiffs situations when participants prearrange not to increase the price of the property during the auction occur more and more often. In such cases one of the participants of the auction purchases property at the lowest price which is dependant on the agreement of participants, not on the market value of the property.
This problem could be solved by appropriate amendments of Articles 710 and 713 of the CPC. Listing the conditions for participation in the auction, additional condition should be fixed that every participant must provide to the bailiff up to the beginning of an auction in the sealed envelope his/her proposal on the price of the property, indicating also his/her name, personal code and address.
Article 708 of the CPC contains the provision that every interested person should be given an opportunity to inspect the property put up for sale prior to the action by rules determined by the bailiff. Existent legal regulation is, in the opinion of the author, insufficient. Taking into account the necessity to protect human rights and fundamental freedoms, an inspection of a dwelling-place of a debtor should be regulated in more detail, by establishing necessary limitations aimed to protect the privacy and respect for home of a debtor and its family members. If a debtor objects the inspection of its dwelling-place, potential purchasers should be given the opportunity to enter and inspect it only if the order of court to permit the entrance to the dwelling-place is presented. CPC should also fix an obligation of a bailiff to inform the debtor about the inspection of its dwelling place in advance.
Article 683 of the CPC should be supplemented by clearly fixing the right of a bailiff, in case if arrested mobile property is left in the possession of a debtor, to lay the debtor under obligation to ensure that interested persons will be able to inspect the property at the time indicated by the bailiff.
The right of a debtor to search for the purchaser of the property put up for sale up to the beginning of an auction, enshrined in Article 704 of the CPC, should as such be assessed positively. However, the mechanism for realisation of this right enables the debtor to misuse procedural rights and protract the recovery. The procedure applicable for the sale of property to a purchaser chosen by the debtor, if approval of such a sale by the notary is required by laws, should be simplified. In these cases the bailiff, upon the request of the claimant, should pass the order of definite form, including essential conditions of sale: term of contract, minimal price, and order of payment. Such a procedure of realization of property would enable a debtor to use possibilities of the market at that date and sell the property more profitable.
In the professional practice of bailiffs situations when participants prearrange not to increase the price of the property during the auction occur more and more often. In such cases one of the participants of the auction purchases property at the lowest price which is dependant on the agreement of participants, not on the market value of the property.
This problem could be solved by appropriate amendments of Articles 710 and 713 of the CPC. Listing the conditions for participation in the auction, additional condition should be fixed that every participant must provide to the bailiff up to the beginning of an auction in the sealed envelope his/her proposal on the price of the property, indicating also his/her name, personal code and address.
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Authors retain copyright of their work, with first publication rights granted to the Association for Learning Technology.
Please see Copyright and Licence Agreement for further details.
