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Laws of Japan |
This English translation of the Civil Code has been prepared up to the revisions of Act No. 78 of
2006 Effective June 21, 2006
in compliance with the Standard Bilingual Dictionary March 2007
edition .
This is an unofficial translation. Only the original
Japanese texts of laws and regulations have
legal effect, and the translations are to be used solely as reference material to aid
in the
understanding of Japanese laws and regulations.
The Government of Japan shall not be responsible for the accuracy, reliability
or currency of the
legislative material provided in this Website, or for any consequence resulting from use of the
information
in this Website. For all purposes of interpreting and applying law to any legal issue or
dispute, users should consult the original
Japanese texts published in the Official Gazette.
Civil Code Act No. 89 of 1896
PART 2 Real Rights
Chapter
1 General Provisions
Article 175 Establishment of Real Rights
No real rights can be established other than those prescribed by
laws including
this Code.
Article 176 Creation and Transfer of Real Rights
The creation and transfer of real rights shall take
effect solely by the
manifestations of intention of the relevant parties.
Article 177 Requirements of Perfection of Changes
in Real Rights concerning
Immovable properties
Acquisitions of, losses of and changes in real rights concerning immovable
properties
may not be asserted against third parties, unless the same are registered
pursuant to the applicable provisions of the Real Estate
Registration Act Law No.
123 of 2004 and other laws regarding registration.
Article 178 Requirements
of Perfection of Transfer of Real Rights concerning
Movables
The transfers of real rights concerning movables may not be asserted
against third
party, unless the movables are delivered.
-1-
Article 179 Confusion
of Rights
1 If ownership and other real rights with respect to the same Thing have vested in
the same person, such other real
rights shall be extinguished; provided, however,
that, this shall not apply to cases where that Thing is, or such other real rights
are, the object of the rights of a third party.
2 If any real rights other than ownership and other rights for which those
real
rights are the object have vested in the same person, such other rights shall be
extinguished. In such cases, the provisions
of the proviso to the preceding
paragraph shall apply mutatis mutandis.
3 The provisions of the preceding two paragraphs shall
not apply to possessory
rights.
Chapter 2 Possessory Rights
Section 1 Acquisition of Possessory Rights
Article 180 Acquisition of Possessory Rights
Possessory rights shall be acquired by holding Thing with an intention to do so
on
one s own behalf.
Article 181 Possession by Agents
Possessory rights may be acquired by an agent.
Article 182 Actual
Delivery and Summary Delivery
1 The transfers of possessory rights shall be effected by the delivery of the Thing
possessed.
2 In cases where a transferee or his/her agent actually holds a Thing, the transfers
of possessory rights may be effected by
the parties' manifestations of intention
alone.
Article 183 Constructive Transfers
If an agent manifests an intention that
The thing possessed by it shall
thenceforward be possessed on behalf of its principal, the principal shall thereby
acquire possessory
rights.
Article 184 Transfers of Possession by Instructions
In cases where a Thing is in an agent s possession, if the
principal orders that
agent to thenceforward possess that Thing on behalf of a third party, and such third
party consents thereto,
that third party shall acquire possessory rights.
-2-
Article 185 Change in Nature
of Possession
In cases where it is assumed, due to the nature of the title, that a possessor does
not have the intention to own, the nature of the possessor
s possession shall not
change unless that possessor manifests to the person who made him/her possess the
Thing that he/she has the
intention of ownership, or commences possession under a
new title with an intention to own from that time.
1 It shall be presumed
that a possessor possesses Thing with the intention to own,
in good faith peacefully and in public.
2 If there is evidence of
possession at two different points in time, it shall be
presumed that possession continued during the interval.
Article 187 Succession
to Possession
1 A successor to a possessor may, at the option of the successor, assert either
his/her possession only, or his/her
possession together with that of the predecessor.
2 In cases where a person asserts the possession of the predecessor together
with
his/her own, he/she shall also succeed to defects in the same.
Section 2 Effect of Possessory Rights
Article
188 Presumption of Lawfulness of Rights Exercised with respect to
Possessed Thing
It shall be presumed that a possessor lawfully
has the rights that a possessor
exercises with respect to Thing in his/her possession.
Article 189 Acquisition of Fruits by Possessor
in Good Faith
1 A possessor in good faith shall acquire fruits derived from Thing in his/her
possession.
2 If a possessor
in good faith is defeated in an action on the title, he/she shall be
deemed to be a possessor in bad faith as from the time when
such action was
brought.
Article 190 Return of Fruits by Possessors in bad faith
1 A possessor in bad faith shall be obligated
to return fruits, and reimburse the
price of fruits that he/she has already consumed, has damaged due to negligence or
has failed
to collect.
2 The provisions of the preceding paragraph shall apply mutatis mutandis to
persons who possess Thing through violence
or duress, or by concealing the same.
-3-
Article 191 Compensation for Damages by
Possessors
If possessed Thing has suffered loss or damage due to reasons attributable to the
possessor, a possessor in bad faith
shall be liable to compensate the person
recovering the loss for the entire loss, and a possessor in good faith shall be liable to
compensate such person for the loss to the extent he/she is actually enriched as a
result of such loss or damage; provided, however,
that a possessor who does not have
the intention of holding as owner must compensate the entire loss, even if he/she is
in good faith.
Article 192 Immediate Acquisition
A person who commences the possession of movables peacefully and openly by a
transactional
act acquires rights to exercise with respect to such movables
immediately if he/she is in good faith and faultless.
Article 193
Recovery of Stolen or Lost Goods
In the cases provided for in the preceding article, if the possessed Thing is lost or
stolen goods,
the victim or person who lost the Thing may demand the recovery of
that Thing from the possessor within two years from the time of
the loss or theft.
Article 194
If a possessor purchased lost or stolen goods in good faith at an auction or in a
public market,
or from a merchant who sells similar Things, the victim or person who
lost the Thing may not recover the Thing unless he/she reimburses
the possessor for
the price paid.
Article 195 Acquisition of Rights through Possession of Animals
A person who possesses a non-domestic
animal bred by others acquires rights to
exercise with respect to that animal if he/she was in good faith at the beginning of
the
possession, and if recovery is not demanded by the owner of the animal within
one month of the time when that animal left the possession
of its owner.
Article 196 Possessors' Claims for Reimbursement of Expenses
1 In cases where a possessor returns Thing in his/her
possession, he/she may have
the person recovering the Thing reimburse necessary expenses including amounts
paid to preserve that Thing,
provided, however, that, if the possessor has acquired
fruits, ordinary necessary expenses shall be borne by the possessor.
2
With respect to beneficial expenses including amounts paid by a possessor to
improve Thing in his/her possession, limited to
cases where there is a current
increase in value, the possessor may, at the election of the person recovering the
Thing, have
the person recovering the Thing reimburse monies the possessor paid
-4-
or the amount
of the increased value; provided, however, that, with regard to a
possessor in bad faith, the court may, at the request of the
person recovering the
Thing, grant a reasonable period for same.
Article 197 Possessory Actions
A possessor may bring a possessory
action in accordance with the provisions of the
following article through Article 202. The same shall apply to a person who takes
possession on behalf of others.
Article 198 Actions for Maintenance of Possession
When a possessor is disturbed in his/her possession,
he/she may claim for the
discontinuation of the disturbance and compensation for damages by bringing an
action for maintenance of
possession.
Article 199 Actions for Preservation of Possession
When a possessor is likely to be disturbed of his/her possession,
he/she may claim
either for the prevention of the disturbance or for the submission of security for the
compensation for damages
by bringing an action for preservation of possession.
Article 200 Actions for Recovery of Possession
1 When a possessor is forcibly
dispossessed, he/she may claim for the restoration of
the Thing and compensation for damages by bringing an action for recovery
of
possession.
2 An Action for recovery of possession cannot be filed against a specific successor
of the usurper of possession;
provided, however, that this shall not apply if that
successor had knowledge of the fact of usurpation.
Article 201 Periods of
Time for Bringing Possessory Actions
1 Actions for maintenance of possession must be brought during the disturbance or
within
one year after the disturbance is extinguished; provided, however, that, in
cases where possessed Thing is damaged due to construction,
if one year has
elapsed from the time when that construction started or if that construction has
been completed, such action
cannot be brought.
2 Actions for preservation of possession may be brought so long as the danger of
disturbance exists. In
such cases, the proviso to the preceding paragraph shall
apply mutatis mutandis if possessed Thing is likely to be damaged by construction.
3 Actions for recovery of possession must be brought within one year of the time
when possession was unlawfully usurped.
Article
202 Relationship with Actions on Title
-5-
1 Possessory Actions do not preclude
actions on title, and actions on title do not
preclude possessory actions.
2 With respect to possessory actions, no judgment
may be made based on reasons
relating to title.
Section 3 Extinction of Possessory Rights
Article 203 Grounds
for Extinction of Possessory Rights
Possessory rights shall be extinguished when the possessor renounces his/her
intention to possess,
or loses possession of the possessed Thing; provided, however,
that this shall not apply if the possessor brings an action for recovery
of possession.
Article 204 Grounds for Extinction of Agent s Possessory Rights
1 In cases where a person possesses
a Thing through an agent, possessory rights
shall be extinguished on the grounds listed below:
i That the principal renounces
his/her intention to have his/her agent possess;
ii That the agent manifests his/her intention to the principal to thenceforward
possess the possessed Thing on behalf of himself/herself or a third party; or
iii That the agent has lost the direct
control over the possessed Thing.
2 Possessory rights shall not be extinguished solely as a result of the extinction of
the power of representation.
Section 4 Quasi-Possession
Article 205
The provisions of this Chapter shall apply
mutatis mutandis to cases where a
person exercises his/her property rights with an intention to do so on his/her own
behalf.
Chapter 3 Ownership
Section 1 Extent of Ownership
Subsection 1 Content and Scope of Ownership
Article 206 Content of Ownership
An owner has the rights to freely use, obtain profit from and dispose of the Thing
owned, subject
to the restrictions prescribed by laws and regulations.
Article 207 Scope of Ownership in Land
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Ownership in land shall extend to above and below the surface of the land, subject
to the restrictions prescribed
by laws and regulations.
Article 208
Deleted
Subsection 2 Neighboring Relationships
Article 209 Requests for
Use of Neighboring Land
1 An owner of land may request the use of the neighboring land to the extent
necessary for constructing
or repairing walls or buildings on or in the vicinity of
the boundary; provided, however, that he/she may not enter the dwelling
house of
the neighbor without the approval of the same.
2 In the cases provided for in the preceding paragraph, if the neighbor
sustained
damages, he/she may claim compensation.
Article 210 Right of Passage over Other Land for Access to Public Roads
1
An owner of land that is surrounded by other land and has no access to public
roads may pass through the other land that surrounds
his/her land to reach the
public roads.
2 The preceding paragraph shall likewise apply in cases where an owner cannot
access
the public roads unless he/she passes through ponds, lakes, rivers,
waterways or seas, or in cases where there is a considerable
difference in height
between the land and the public road on account of a cliff.
Article 211
1 In the cases provided for in
the preceding article, the location and method of
passage must be so chosen as to meet the needs of the person who is entitled
to the
right of passage under the provisions of that article, and cause the least damage to
the other land.
2 A person who
holds the right of passage under the provisions of the preceding
article may construct a road if necessary.
Article 212
A person
who is entitled to the right of passage pursuant to the provisions of
Article 210 must pay compensation for damage caused to the
other land that he/she
passes through; provided, however, that, except for damage arising from the
construction of a road, compensation
may be paid on an annual basis.
Article 213
-7-
1 If the partition of land creates
a parcel of land that has no access to public
roads, the owner of such parcel of land may pass to the public roads only through
the lands owned by others who participated in the partition. In such cases, it
shall not be necessary to pay compensation.
2 The provisions of the preceding paragraph shall apply mutatis mutandis to cases
where the owner of land assigns part of his/her
land to others.
Article 214 Prohibition of Obstruction of Natural Water Streams
A landowner may not interfere with a natural
water stream flowing from
neighboring land.
Article 215 Removal of Barriers to Water Streams
If a stream is blocked at low-lying
ground due to a natural disaster or other
unavoidable event, an owner of higher ground may carry out construction work
necessary
to remove the barrier to the stream at his/her own expense.
Article 216 Repairs of Structures related to Streams
If land suffers,
or is likely to suffer, damage due to destruction or blockage of a
structure installed on other land to store, discharge or draw water, the owner of that
land may
have the owners of such other lands repair the structure or remove the
barriers, or, if necessary, have the same carry out preventive
construction work.
Article 217 Customs with respect to Allocation of Expenses
In the cases provided for in the preceding two
articles, if there are other customs
with respect to the allocation of expenses, those customs shall prevail.
Article 218 Prohibition
of Installation of Structures that Discharge Rainwater to
Neighboring Lands
A landowner may not install any structure including
a roof that discharges
rainwater directly onto neighboring land.
Article 219 Changes to Streams
1 An owner of land containing
a stream including a channel or moat may not
change the course or width of the same if the land on the other side is owned by
others.
2 If the land on both sides of a stream is owned by the owner of the land
containing the stream, that owner may change
the course or the width of the same;
provided, however, that he/she must return the stream to its natural course at the
point
where the stream meets neighboring land.
3 If there are customs that differ from the provisions of the preceding two
-8-
paragraphs, those customs shall prevail.
Article 220 Running Water through Lower Ground
for Discharge
An owner of a higher ground may run water through lower grounds to dry out
his/her higher ground in cases where that
land is flooded, or to discharge surplus
water for household or agricultural or industrial use until the water meets a public
stream
or sewage system. In such cases, the location and method that cause the
least damage to the lower ground must be selected.
Article 221 Use of Structures to Direct Water
1 A landowner may use structures established by owners of higher ground or lower
ground in order to cause water from his/her land to pass through the same.
2 In the cases provided for in the preceding paragraph,
the person who uses the
structures of others must bear the expenses of the establishment and preservation
of the structures in
proportion to the benefit he/she enjoys.
Article 222 Construction and Use of Dams
1 If the owner of land containing a stream
needs to construct a dam, he/she may
construct that dam by fixing it to the other side even if the land on the other side
is
owned by others; provided, however, that he/she must pay compensation for
damages arising as a result.
2 The owner of the land
on the other side may use the dam under the preceding
paragraph if he/she owns part of the land containing the stream.
3 The
provisions of Paragraph 2 of the preceding article shall apply mutatis
mutandis to the cases provided for in the preceding paragraph.
Article 223 Installation of Boundary Markers
A landowner may install boundary markers, sharing the expenses with the owner
of
the neighboring land.
Article 224 Expenses of Installation and Preservation of Boundary Markers
The expenses of installation
and preservation of boundary markers shall be borne
equally by neighbors; provided, however, that measuring expenses shall be borne
in
proportion to the sizes of the relevant land parcels.
Article 225 Installation of Fences
1 If two buildings are owned by
different owners and there is an open lot between
them, each owner may install a fence on the boundary, sharing the expenses with
the other owner.
2 If no agreement can be reached between the parties, the fence under the
-9-
preceding paragraph must be wooden fencing, bamboo fencing or fencing made of
similar material and must be
two meters high.
Article 226 Expenses of Installation and Preservation of Fences
The expenses of installation and preservation
of the fences under the preceding
article shall be borne equally by the neighbors.
Article 227 Installation of Fences by One of Neighbors
One of neighboring owners may install a fence
using materials better than those
provided for in Paragraph 2 of Article 225 or elevating the height provided for under
the same
paragraph; provided, however, that he/she must bear the increase in
expenses arising as a result of the same.
Article 228 Customs
relating to Installation of Fences
If there are customs that differ from the provisions of the preceding three articles,
those
customs shall prevail.
Article 229 Presumption of Co-ownership of Boundary Markers
Boundary markers, fences, walls, channels
and moats installed on boundary lines
shall be presumed to be co-owned by the neighbors.
Article 230
1 The provisions of the
preceding article shall not apply to a wall on a boundary
line that forms a part of a building.
2 If the height of a wall that
separates two neighboring buildings of different
heights is higher than the height of the lower building, the preceding paragraph
shall likewise apply with respect to such portion of that wall that is higher than
the lower building; provided, however, that
this shall not apply to fire walls.
Article 231 Construction Work raising Height of Co-owned Walls
1 One of neighboring owners
may raise the height of a co-owned wall; provided,
however, that, if the wall cannot withstand the construction work, he/she must
reinforce that wall as necessary or rebuild the same.
2 If the height of a wall is raised under the provisions of the preceding
paragraph,
the raised portion shall be owned solely by the person who carried out the
construction work.
Article 232
In the
cases provided for in the preceding article, if a neighbor suffers damage,
he/she may demand compensation for the same.
- 10 -
Article 233 Cutting of Branches and Roots of Trees and Bamboo
1 If a tree or bamboo
branch from neighboring land crosses a boundary line, the
landowner may have the owner of that tree or bamboo sever that branch.
2 If a tree or bamboo root from neighboring land crosses a boundary line, the
owner of the land may sever that root.
Article
234 Restrictions on Buildings near Boundary Lines
1 In order to construct a building, the building must be distanced 50 centimeters
or more away from the boundary line.
2 If a person attempts to construct a building in violation of the provisions of the
preceding paragraph, the owner of the neighboring land may have construction
suspended or changed; provided, however, that, if
one year has lapsed from the
time when such construction started or if that building has been completed, the
owner may only claim
damages.
Article 235
1 A person who installs a window or porch hereinafter in this and the following
paragraph including a
veranda at a distance of less than one meter from a
boundary line allowing the observation of the residential land of others,
must put
up a privacy screen.
2 The distance under the preceding paragraph shall be calculated by measuring
the length of
a straight line from the point on the window or porch closest to the
neighboring land to where it reaches the boundary line at
a right angle.
Article 236 Customs relating to Construction near Boundary Lines
If there are customs that differ from the provisions
of the preceding two articles,
those customs shall prevail.
Article 237 Restrictions on Digging near Boundary Lines
1 In order
to dig a well, service water pit, sewage pit or compost pit, the same
must be distanced two or more meters from the boundary line,
and in order to dig
a pond, cellar or urine pit, the same must be distanced one or more meters from
the boundary line.
2 In
order to bury water pipes, or dig a channel or moat, the same must be
distanced from the boundary line by a measurement equivalent
to at least half the
depth of the same; provided, however, that the distance is not required to be more
than one meter.
Article 238 Duty of Care regarding Digging near Boundary Lines
- 11 -
When construction under the preceding article is to be carried out near a
boundary
line, necessary care must be taken to ensure the prevention of earth collapses or
leakages of water or contaminated liquids.
Section 2 Acquisition of Ownership
Article 239 Ownership in Ownerless Thing
1 Ownership of movables without an owner
shall be acquired by possessing the
same with the intention to own.
2 Ownership of real estate without an owner shall vest
in the National Treasury.
Article 240 Finding of Lost Property
If the owner of lost property is not identified within three months
of the time when
public notice thereof is effected as prescribed by the Lost Property Act Law No. 73
of 2006 , the person who
found the lost property shall acquire ownership in the
same.
Article 241 Discovery of Hidden Treasure
If the owner of hidden
treasure is not identified within six months of the time
when public notice thereof is effected as prescribed by the Lost Property
Act, the
finder shall acquire ownership in the same; provided, however, that, with respect to
hidden treasure discovered in a Thing
belonging to other person, the finder and such
other person shall acquire equally proportionate ownership in the same.
Article
242 Accession to Real Estate
The owner of real estate shall acquire ownership in a Thing that has been attached
thereto as its
accessory ; provided, however, that the rights of the other person who
attached such Thing by virtue of his/her title shall not be
precluded.
Article 243 Accession to Movables
If two or more movables with different owners are so joined to each other that they
can no longer be separated without damaging the same, ownership of the composite
Thing shall vest in the owner of the principal movables.
The same shall apply if
excessive expense would be required to separate the same.
Article 244
If the distinction of principal
and accessory cannot be made between the joined
movables, the owner of each movable shall co-own the composite Thing in proportion
to the respective price current at the time of the accession.
- 12 -
Article 245 Mixture
The provisions of the preceding two articles shall apply mutatis mutandis to cases
where the Things of different owners are mixed
together and can no longer be
distinguished.
Article 246 Processing
1 If a person hereinafter in this article referred to
as "Processor" contributes
work to the movables of others, ownership of the Thing so worked up shall vest in
the owner of the
materials; provided, however, that, if the value derived from the
work significantly exceeds the value of the materials, the Processor
shall acquire
ownership in the processed Thing.
2 In the cases provided for in the preceding paragraph, if the Processor supplies
a
portion of the materials, the Processor shall acquire ownership in the processed
Thing, limited to if the value of such supplied
materials plus the value derived
from the work exceeds the value of the materials of others.
Article 247 Effect of Accession,
Mixture or Processing
1 If the ownership of a Thing is extinguished in accordance with the provisions of
Article 242 through
the preceding article, other rights in existence in relation to
such Thing shall also be extinguished.
2 In the cases provided
for in the preceding paragraph, if the owner of a Thing has
become the sole owner of the Thing formed by accession, mixture or
processing
hereinafter in this paragraph referred to as "composite Thing" , other rights in
existence in relation to such
Thing shall thereafter exist in relation to the
composite Thing, and if the owner of the Thing becomes a co-owner of the
composite
Thing, other rights in existence in relation to such Thing shall thereafter
exist in relation to his/her share in the same.
Article 248 Demands for Compensation
in conjunction with Accession, Mixture or
Processing
A person who suffers loss because of the application of the provisions of
Article 242
through the preceding article may demand compensation in accordance with the
provisions of Article 703 and Article 704.
Section 3 Co-Ownership
Article 249 Use of property in co-ownership
Each co-owner may use the entire property in co-ownership
in proportion to his/her
share.
- 13 -
Article 250 Presumption of Proportion of Co-owner
s Shares
Each co-owner s share shall be presumed to be equal.
Article 251 Changes to Co-owned Thing
No co-owner
may make any alteration to the property in co-ownership without the
consent of the other co-owners.
Article 252 Management of Co-owned
Thing
Matters regarding the management of property in co-ownership shall be
determined by a majority of the value of the shares
of the co-owners, except for cases
provided for in the preceding paragraph; provided, however, that any co-owner may
carry out acts
of preservation.
Article 253 Obligations to bear Burdens regarding property in co-ownership
1 Each co-owner shall pay the expenses
of management and otherwise bear
burdens regarding the property in co-ownership, in proportion to his/her share.
2 If a co-owner
does not perform the obligations under the preceding paragraph
within one year, other co-owners may acquire the share of such person
by paying
reasonable compensation.
Article 254 Claims on property in co-ownership
A claim that one of co-owners holds against
other co-owners with respect to the
property in co-ownership may be exercised against their specific successors.
Article 255
Renunciation of Shares and Death of Co-owners
If one of co-owners renounces his/her share or dies without an heir, his/her share
shall vest in other co-owners.
Article 256 Demands for Partition of property in co-ownership
1 Each co-owner may demand the
partition of property in co-ownership at any
time; provided, however, that this shall not preclude concluding a contract to the
effect that a partition will not occur for a period within five years.
2 The contract under the proviso to the preceding paragraph
may be renewed;
provided, however, that the period thereof may not exceed five years from the time
of the renewal.
Article
257
The provisions of the preceding article shall not apply to the property in
co-ownership provided for in Article 229.
- 14 -
Article 258 Partition of property in co-ownership by Judgment
1 If no agreement
is reached among co-owners with respect to the partition of
property in co-ownership, a demand for partition of the same may be
submitted to
the court.
2 In cases provided for in the preceding paragraph, if the property in co-ownership
cannot be partitioned
in kind, or it is likely that the value thereof will be
significantly reduced by the partition, the court may order the sale of
the same at
auction.
Article 259 Performance of Obligations regarding Co-ownership
1 If one of the co-owners holds a claim
regarding co-ownership against other
co-owners, upon partition, the portion of the property in co-ownership that vests in
the
obligors may be appropriated for the performance of the same.
2 If it is necessary to sell the portion of the property in co-ownership
that vests in
the obligors to obtain the performance under the preceding paragraph, the obligee
may demand the sale of the same.
Article 260 Participation in Partition of property in co-ownership
1 Persons who hold rights with respect to property in co-ownership
and the obligee
of any co-owner may participate in partitions at their own expense.
2 If, notwithstanding a request for participation
under the provisions of the
preceding paragraph, partition is effected without allowing the participation of the
person who submitted the
request, that partition may not be asserted against the
person who submitted the request.
Article 261 Co-owners' Warranties upon
Partitions
Each co-owner shall bear, in proportion to his/her share, the responsibility of
warranty that a seller would have as
to the Thing other co-owners have acquired by
partition.
Article 262 Documents regarding property in co-ownership
1 If a partition
has been completed, each person who participated in the partition
must retain the documents regarding the Thing he/she acquired.
2 Documents regarding the Thing that is partitioned for some or all co-owners
must be retained by the person who acquired the
largest portion of that Thing.
3 In the cases provided for in the preceding paragraph, if no person acquired the
largest portion,
the person who is to retain the documents shall be determined by
mutual agreement among the persons who participated in the partition.
If no
agreement is reached, the court shall designate the same.
4 The person who is to retain the documents must
allow other persons who
- 15 -
participated in the partition to use the documents
at the request of the same.
Article 263 Rights of Common with Nature of Co-ownership
Rights of common that have the nature of
co-ownership shall be governed by local
custom and shall otherwise be subject to the application of the provisions of this
Section.
Article 264 Quasi Co-ownership
The provisions of this Section shall apply mutatis mutandis to the cases where two
or more persons
share property rights other than the ownership; provided, however,
that this shall not apply if laws and regulations provide otherwise.
Chapter 4 Superficies
Article 265 Content of Superficies
A superficiary shall have the right to use the land of others
in order to own
structures, or trees or bamboo, on that land.
Article 266 Rents
1 The provisions of Articles 274 through 276
shall apply mutatis mutandis to cases
where the superficiary must pay periodical rent to the owners of the land.
2 In addition
to the provisions of the preceding paragraph, provisions on leasehold
shall apply mutatis mutandis to rent to the extent that application
is not
inconsistent with the nature of the same.
Article 267 Mutatis Mutandis Application of Provisions regarding Neighboring
Relationships
The provisions of Subsection 2, Section 1 of the preceding Chapter Neighboring
Relationships shall apply
mutatis mutandis between superficiaries or between a
superficiary and a landowner; provided, however, that the mutatis mutandis
application
of the provisions of Article 229 to holders of superficies shall be limited to
cases where structures on the boundary line are installed
after the creation of the
superficies.
Article 268 Duration of Superficies
1 In cases where the duration of superficies is not
fixed by the act that established
the same, if there is no other custom, the superficiary may renounce their rights at
any time;
provided, however, that, if rent must be paid, the superficiary must give
notice one year or more in advance or pay rent for one
year that has not yet
become due and payable.
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2 If the superficiary does
not renounce its rights in accordance with the provisions
of the preceding paragraph, the court may, at the request of the parties
concerned,
fix a duration of twenty years or more but not more than fifty years, taking into
consideration the kind and status
of the structures, or trees or bamboo and other
circumstances at the time of the creation of the superficies.
Article 269 Removal
of Structures
1 When the right of the superficiary is extinguished, he/she may restore the land
to its original condition and
remove structures and trees or bamboo on the same;
provided, however, that, if the owner of the land gives notice that he/she will
purchase the same by offering to pay an amount equivalent to the market price,
the superficiary may not refuse that offer without
justifiable grounds.
2 If there are customs that differ from the provisions of the preceding paragraph,
those customs shall
prevail.
Article 269-2 Superficies for Underground or Overhead Space
1 Underground or overhead space may be used as the object
of superficies in order
to own structures by specifying limits in the vertical dimension. In such cases,
restrictions
on the use of that land may be added in the act that establishes
superficies for the purpose of facilitating the exercise of the
superficies.
2 The superficies under the preceding paragraph may be established even in cases
where third parties hold rights
to use or receive profits from land if all persons
who hold those rights or rights underlying the same consent. In
such cases,
persons who hold the rights to use or receive profits from the land cannot preclude
the exercise of the superficies
to the same.
Chapter 5 Emphyteusis
Article 270 Content of Emphyteusis
An emphyteuta shall have the right to engage in
cultivation or livestock farming
on the land of others by paying rent.
Article 271 Restrictions on Alterations to Land by Emphyteutas
An emphyteuta may not make any alteration of the land that will result in
irreparable damage.
Article 272 Transfer of Emphyteusis
or Leasing of Land
An emphyteuta may assign his/her rights to others, or lease the land during the
duration of his/her rights to
cultivate or farm livestock; provided, however, that this
shall not apply if such acts are prohibited by the act that established
his/her rights.
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Article 273 Mutatis Mutandis Application of Provisions regarding
Lease
In addition to the provisions of this Chapter and those provided for in the act that
established the emphyteusis, provisions
regarding lease shall apply mutatis mutandis
to the obligations of a emphyteuta, to the extent that application is not inconsistent
with the nature of the same.
Article 274 Rent Reductions or Exemptions
An emphyteuta may not demand an exemption from or reduction
in the rent even
if a loss of profits has been suffered due to force majeure.
Article 275 Waiver of Emphyteusis
If an emphyteuta
has gained no profit whatsoever for three or more consecutive
years or has gained profits less than the rent for five or more consecutive
years due
to force majeure, he/she may surrender his/her rights.
Article 276 Demand for Extinction of Emphyteusis
If an emphyteuta
fails to pay the rent for two or more consecutive years, the
landowner may demand the extinction of the emphyteusis.
Article 277
Customs regarding Emphyteusis
If there are customs that differ from the provisions of Article 271 through the
preceding article,
those customs shall prevail.
Article 278 Duration of Emphyteusis
1 The duration of the emphyteusis shall be twenty years or
more but no more than
fifty years. Even if an act establishing emphyteusis provides for a period longer
than fifty years, the
duration shall be fifty years.
2 The establishment of emphyteusis may be renewed; provided, however, that the
duration of the
same may not exceed fifty years from the time of renewal.
3 If an act establishing emphyteusis does not provide for the duration
of the
emphyteusis, the duration of the same shall be thirty years unless there is a
custom to the contrary.
Article 279 Removal
of Structures
The provisions of Article 269 shall apply mutatis mutandis to emphyteusis.
Chapter 6 Servitudes
Article
280 Content of Servitudes
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A person entitled to a servitude shall have the
right to make lands of others
available for the benefit of their own lands in accordance with purposes prescribed in
the acts establishing the servitudes; provided,
however, that those rights should not
violate the provisions limited to those that relate to public policy under Section 1
of Chapter 3 Extent of Ownership .
Article 281 Appurtenant Nature of Servitudes
1 Servitudes are appurtenant to ownership in
the dominant land hereinafter
referring to the land of a person entitled to a servitude, enjoying benefits from the
land of others and shall be transferred together with that ownership, or shall be
the subject of other rights that exist in
relation to the dominant land; provided,
however, that this shall not apply if the act establishing the servitude provides
otherwise.
2 Servitudes may neither be assigned nor made the subject of other rights apart
from the dominant land.
Article 282 Indivisibility
of Servitudes
1 One of the co-owners of land may not extinguish, with respect to his/her own
share, a servitude that exists
on behalf of or in relation to the land.
2 In cases where land is partitioned or a portion thereof is assigned to others, a
servitude shall exist on behalf of or in relation to the respective portions of the
same; provided, however, that this shall not
apply if the servitude, by its nature,
relates only to a portion of the land.
Article 283 Acquisition of Servitudes by Prescription
A servitude can be acquired by prescription so long as it is continuously exercised
and can be externally recognized.
Article
284
1 If one of the co-owners of land acquires a servitude by prescription, the other
co-owners shall also acquire the same.
2 Interruption of prescription shall not be effected against co-owners unless it is
made against each co-owner who exercises
the servitude.
3 In cases where there are two or more co-owners who exercise a servitude, even if
there is cause to suspend
the prescription with respect to one of them, the
prescription shall run in favor of each co-owner.
Article 285 Water Servitude
1 If water on servient land hereinafter referring to a land of any person other
than the one entitled to the servitude, made
available for the benefit of the
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dominant land subject to a water servitude
is insufficient for the demand of the
dominant land and the servient land, the water shall be used in proportion to the
demand
on each parcel of land, firstly for household purposes with the remaining
portion used for other purposes; provided, however, that
this shall not apply if the
act establishing the servitude provides otherwise.
2 If more than one water servitude is created
with respect to the same servient
land, the persons subsequently entitled may not prevent the use of water by those
previously
entitled.
Article 286 Obligations of Owners of Servient Land to Install Structures
If the owner of servient land has assumed
obligations to install or repair structures
for the exercise of a servitude at his/her own expense by the act establishing the
servitude
or by a contract executed after the same, specific successors of the owner of
the servient land shall also assume those obligations.
Article 287
An owner of servient land may be exempted from obligations of the preceding
article at any time by abandoning the
ownership in the portion of the land necessary
for the servitude and transferring the same to the person entitled to a servitude.
Article 288 Use of Structures by the Owner of Servient Lands
1 The owner of a servient land may use structures installed on
the servient land
for the exercise of the servitude to the extent his/her use does not obstruct the
exercise of that servitude.
2 In the cases provided for in the preceding paragraph, the owner of the servient
land must bear the expense for the installation
and preservation of the structures
in proportion to the benefit he/she receives.
Article 289 Extinction of Servitude by Acquisition by Prescription of Servient
Lands
If the possessor of servient land has so possessed the same as to satisfy the
requirements for acquisitive prescription, the servitude
shall be extinguished thereby.
Article 290
The extinctive prescription of the preceding article is nullified by the person
entitled
to the servitude exercising his/her rights.
Article 291 Extinctive Prescription of Servitudes
The period of the extinctive prescription
provided for in Paragraph 2 of Article 167
shall commence upon the final exercise of the servitude if the servitude is not
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exercised continuously, and upon the occurrence of a fact that prevents the exercise
of the servitude if the servitude is exercised continuously.
Article 292
In cases where dominant land is co-owned by more than
one person, if there is a
suspension or interruption of prescription in favor of one co-owner, such suspension
or interruption shall
also be effective for the benefit of other co-owners.
Article 293
If a person entitled to a servitude does not exercise a portion
of his/her rights, only
that portion shall be extinguished by prescription.
Article 294 Rights of Common without the Nature of
Co-Ownership
Rights of common that do not have the nature of co-ownership shall be governed by
local customs and shall otherwise
be subject to the mutatis mutandis application of
the provisions of this Section.
Chapter 7 Rights of Retention
Article
295 Content of Rights of Retention
1 If a possessor of a Thing belonging to another person has a claim that has arisen
with
respect to that Thing, he/she may retain that thing until that claim is
satisfied; provided, however, that this shall not apply
if such claim has not yet
fallen due.
2 The provisions of the preceding paragraph shall not apply in cases where
possession
commenced by means of a tortious act.
Article 296 Indivisibility of Rights of Retention
A holder of a right of retention may
exercise his/her rights against the whole of the
Thing retained until his/her claim is satisfied in its entirety.
Article 297 Collection
of Fruits by Holders of Rights of Retention
1 A holder of a right of retention may collect fruits derived from the Thing
retained,
and appropriate the same to the satisfaction of his/her claim prior to
other obligees.
2 The fruits under the preceding paragraph
must be appropriated first to the
payment of interest on the claim, and any remainder must be appropriated to the
satisfaction
of the principal.
Article 298 Keeping the Thing Retained by Holders of Rights of Retention
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1 A holder of a right of retention must possess the Thing retained with the care of
a good manager.
2 A
holder of rights of retention may not use, lease or give as a security the Thing
retained unless he/she obtains the consent of
the obligor; provided, however, that
this shall not apply to uses necessary for the preservation of that Thing.
3 If the holder
of a right of retention violates the provisions of the preceding two
paragraphs, the obligor may demand that the right of retention
be extinguished.
Article 299 Demands for Reimbursement of Expenses by Holders of Rights of
Retention
1 If a holder of a right
of retention incurs necessary expenses with respect to the
Thing retained, he/she may have the owner reimburse the same.
2 If
a holder of a right of retention incurs beneficial expenses with respect to the
Thing retained, to the extent that there is currently
an increase in value as a
result of the same, he/she may have the expenses incurred or the increase in value
reimbursed at the
owner s election; provided, however, that the court may, at the
request of the owner, grant a reasonable period for the reimbursement
of the same.
Article 300 Exercise of Rights of Retention and Extinctive Prescription of Claims
The exercise of a right of retention shall not preclude
the running of extinctive
prescription of claims.
Article 301 Extinction of Rights of Retention by Tender of Security
An obligor
may demand that a right of retention be extinguished by tendering
reasonable security.
Article 302 Extinction of Rights of Retention
by Loss of Possession
A right of retention shall be extinguished if the holder of the right of retention
loses possession of the
Thing retained; provided, however, that this shall not apply if
the Thing retained is leased or it is made the subject of a pledge
in accordance with
the provisions of Paragraph 2 of Article 298.
Chapter 8 Statutory Liens
Section 1 General
Provisions
Article 303 Content of Statutory Liens
A holder of a statutory lien shall have the rights to have his/her own claim
satisfied prior to other obligees out of the assets of the relevant obligor in accordance
with the provisions of laws including this
Act.
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Article 304 Extension of Security Interest to Proceeds of Collateral
1
A statutory lien may also be exercised against Things including monies that the
obligor is to receive as a result of the
sale, lease or loss of, or damage to, the
subject matter of the statutory lien; provided, however, that the holder of the
statutory
lien must attach the same before the payment or delivery of the monies
or other Thing.
2 The provisions of the preceding
paragraph shall likewise apply to the
consideration for real rights established by the obligor on the subject matter of the
statutory
lien.
Article 305 Indivisibility of Statutory Liens
The provisions of Article 296 shall apply mutatis mutandis to statutory liens.
Section 2 Kinds of Statutory Liens
Subsection 1 General Statutory Lien
Article 306 General Statutory
Lien
A person who has a claim that arose from the causes listed below shall have a
statutory lien over the entire property of the
obligor:
i Expenses for the common benefit;
ii An employer-employee relationship;
iii Funeral expenses;
or
iv The supply of daily necessaries.
Article 307 Statutory Liens for Expenses for Common Benefit
1 Statutory
liens for expenses for the common benefit shall exist with respect to
the expenses of preservation, liquidation or distribution
of the property of the
obligor incurred for the common benefit of all obligee.
2 With respect to expenses that were not
beneficial for all obligees, a statutory lien
shall exist solely for obligees who received a benefit as a result of such expenses.
Article 308 Statutory Liens for Employer-Employee Relationships
Statutory liens for employer-employee relationships shall exist
with respect to
salaries and other claims that arose under the employer-employee relationship
between the obligor and his/her employee.
Article 309 Funeral Expenses
1 Statutory liens for funeral expenses shall exist with respect to the reasonable
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expenses of a funeral observed for the obligor.
2 The statutory lien under
the preceding paragraph shall also exist with respect to
the reasonable expenses of a funeral observed by the obligor for a relative
whom
the obligor is bound to support.
Article 310 Statutory Liens for Household Items
Statutory liens for daily necessaries
shall exist with respect to the supply of food
and drink items, fuel and electricity for the most recent six months required for
the
household of the obligor or his/her relatives who reside with the obligor and whom
the obligor is bound to support and the domestic
servants of the same.
Subsection 2 Statutory Liens over Movables
Article 311 Statutory Liens over Movables
A person who has a claim that arose from the causes listed below shall have a
statutory lien over certain movables of the obligor:
i A lease of immovable
property;
ii A lodging at a hotel or inn;
iii The transportation of passengers or luggage;
iv The preservation
of movables;
v The sale of movables;
vi The supply of seed or fertilizer hereinafter including eggs of silkworms
or
mulberry leaves used to feed silkworms ;
vii Agricultural labor; or
viii Industrial labor.
Article
312 Statutory Liens for Leases of Immovable Properties
Statutory liens for a lease of immovable property shall exist with respect
to the
movables of the lessee in connection with obligations of the lessee that arose from the
lease relationship including rent
for that immovable property.
Article 313 Scope of Subject Matter of Statutory Liens for Leases of Immovable
Properties
1 The statutory lien of a lessor of land shall exist with respect to movables
furnished to that land or buildings for the
use of that land, movables provided for
the use of that land, and fruits of that land in the possession of the lessee.
2
The statutory lien of a lessor of a building shall exist with respect to movables
furnished to that building by the lessee.
Article 314
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In the cases of assignment of lessee s rights or subleasing,
the statutory lien of
the lessor shall extend to the movables of the assignee or sublessee. The same shall
apply to monies that the
assignee or sublessee is to receive.
Article 315 Scope of Secured Claims under Statutory Liens for Leases of Immovable
Properties
In cases where all of the lessee s property is to be liquidated, the statutory lien of
the lessor shall exist only with respect
to obligations, including rent, for the previous,
current and next terms, and obligations to compensate for damage that arose in
the
previous and current terms.
Article 316
In cases where a lessor has received a security deposit, he/she shall have a
statutory
lien solely in respect of the portion of his/her claim that will not be satisfied
by that security deposit.
Article 317 Statutory
Liens for Lodging at Hotels
Statutory lien for lodging at hotels shall exist with respect to the hand luggage of a
hotel guest
left at that hotel, in connection with room charges, and food and beverage
charges, that should be borne by the hotel guest.
Article
318 Statutory Liens for Transportation
Statutory liens for transportation shall exist with respect to luggage in the
possession
of the transporter, in connection with transportation charges for
passengers or luggage and expenses incidental to the same.
Article
319 Mutatis Mutandis Application of Provisions on Immediate Acquisition
The provisions of Articles 192 through 195 shall apply
mutatis mutandis to
statutory liens under the provisions of Article 312 through the preceding article.
Article 320 Statutory Liens
for Preservation of Movables
Statutory liens for the preservation of movables shall exist with respect to
movables, in connection
with expenses required for the preservation of those
movables, or expenses required for the preservation, approval or execution of
rights
regarding those movables.
Article 321 Statutory Liens for Sale of Movables
Statutory liens for the sale of movables shall
exist with respect to movables, in
connection with the price of those movables and interest on the same.
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Article 322 Statutory Liens for Supply of Seed or Fertilizer
Statutory liens for the supply of seed
or fertilizer shall exist with respect to fruits
including eggs of silk worms or any Thing derived from the use of mulberry leaves
used to feed silkworms derived from land where the seed or fertilizer was used,
within one year of that use, in connection
with the price of that seed or fertilizer and
interest on the same.
Article 323 Statutory Liens for Agricultural Labor
Statutory liens for agricultural labor shall exist,
with respect to fruits derived from
labor, in connection with the most recent year s wages of the person who engages in
that
labor.
Article 324 Statutory Liens for Industrial Labor
Statutory liens for industrial labor shall exist, with respect to manufactured
things
derived from labor, in connection with the most recent three months' wages of the
person who engages in that labor.
Subsection 3 Statutory Liens for Immovable Properties
Article 325 Statutory Liens for Immovable Properties
A person
who has a claim that arose from the causes listed below shall have a
statutory lien over certain immovable property of the obligor:
i The preservation of immovable property;
ii Construction work for immovable property; or
iii The sale of
immovable property.
Article 326 Statutory Liens for Preservation of Immovable Properties
Statutory liens for the preservation
of immovable property shall exist with respect
to immovable property, in connection with the expenses required for the preservation
of that immovable property or the expenses required for the preservation, approval or
execution of rights regarding that immovable
property.
Article 327 Statutory Liens for Construction Work for Immovable Properties
1 Statutory lien for construction work
for immovable property shall exist, with
respect to immovable property, in connection with the expenses of construction
work
performed by a person who designs, carries out or supervises construction
work regarding the immovable property of the obligor.
2 The statutory liens under the preceding paragraph shall exist, in cases where
there is a current increase in the value
of the immovable property resulting from
the construction work, with respect to that increased value.
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Article 328 Statutory Liens for Sales of Immovable properties
Statutory liens for sales of immovable
properties shall exist, with respect to
immovable property, in connection with the price of that immovable property and
interest
on the same.
Section 3 Order of Priority of Statutory Liens
Article 329 Order of Priority of General Statutory Liens
1 In cases where there is conflict among general statutory liens, the order of
priority shall follow the order listed in
each item of Article 306.
2 In cases where there is conflict between a general statutory lien and a special
statutory lien,
the special statutory lien shall prevail over the general statutory
lien; provided, however, that statutory liens on expenses for
the common benefit
shall have the effect of prevailing over all obligees who received the benefit of the
same.
Article 330
Order of Priority of Statutory Liens over Movables
1 In cases where there is conflict among special statutory liens with respect
to the
same movables, the order of priority shall follow the order listed below. In such
cases, if there are two or
more preservers with respect to the statutory liens for
preservation of movables listed in Item ii , a new preserver
shall prevail over
previous preservers.
i Statutory liens for leases of immovable properties, lodging at hotels and
transportation;
ii Statutory liens for the preservation of movables; and
iii Statutory liens for the sale
of movables, the supply of seed or fertilizer,
agricultural labor and industrial labor.
2 In the cases provided for
in the preceding paragraph, if a holder of a statutory
lien ranked first knew at the time he/she acquired that claim of the existence
of a
holder of a statutory lien of the second or third rank, he/she cannot exercise his/her
rights against those persons. The
same shall likewise apply against persons who
preserved Things on behalf of the holder of a statutory lien of the first rank.
3 Regarding fruits, the first rank shall belong
to persons who engage in
agricultural labor, the second rand shall belong to persons who supply seed or
fertilizer, and the third
rank shall belong to lessors of land.
Article 331 Order of Priority of Statutory Liens over Immovable properties
1 In cases
where there is conflict among special statutory liens with respect to the
same immovable properties, the order of priority shall
follow the order of the items
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of Article 325.
2 In cases where successive
sales are made with respect to the same immovable
properties, the order of priority of the statutory liens for the sale of the
immovable
properties among sellers shall follow the chronological order of the sales.
Article 332 Statutory Liens with Same Priority
If there are two or more holders of statutory liens with the same priority with
respect to the same object, the holders of statutory
liens shall be paid in proportion to
the amounts of their claims.
Section 4 Effect of Statutory Liens
Article 333 Statutory
Liens and Third-party Acquirers
Statutory liens may not be exercised with respect to the movables that are the
subject matter of
the same after the obligors have delivered those movables to
third-party acquirers.
Article 334 Conflict between Statutory Liens
and Pledges of Movables
In cases where there is conflict between a statutory lien and a pledge of movables,
the pledgee of such
movables shall have the same rights as those of the holder of a
statutory lien of the first rank under Article 330.
Article 335
Effect of General Statutory Liens
1 Holders of general statutory liens cannot be paid out of immovable properties
unless they
are first paid out of property other than immovable properties and a
claim that is not satisfied remains.
2 With respect to
immovable properties, holders of general statutory liens must
first be paid out of those that are not the subject matters of special
security.
3 If holders of general statutory liens fail to participate in distributions in
accordance with the provisions of
the preceding two paragraphs, they cannot
exercise their statutory liens against registered third parties with respect to
amounts
that would have been paid to them if they had participated in the
distribution.
4 The provisions of the preceding three paragraphs
shall not apply to cases where
the proceeds of immovable properties are distributed prior to the proceeds of assets
other than
immovable properties, or the proceeds of immovable properties that is
the subject matter of a special security are distributed
prior to the proceeds of
other immovable properties.
Article 336 Perfecton of General Statutory Liens
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General statutory liens may be asserted against obligees without special security,
even if the
liens are not registered with respect to the relevant immovable property;
provided, however, that this shall not apply to registered
third parties.
Article 337 Registration of Statutory Liens for Preservation of Immovable
Properties
In order to preserve the
effectiveness of statutory liens for preservation of
immovable properties, registration must be carried out immediately after the
completion of the act of preservation.
Article 338 Registration of Statutory Liens for Construction Work for Immovable
Properties
1 In order to preserve the effectiveness of statutory liens for construction work for
immovable properties, the budgeted expenses
of the construction work must be
registered prior to the commencement of the same. In such cases, if the expenses
of the construction
work exceed the budgeted amount, a statutory lien shall not
exist with respect to the amount in excess of the same.
2 The amount
of increase in value of immovable properties that resulted from
construction work must be evaluated by an appraiser selected by the court at the
time of the participation in the distribution.
Article 339 Registered Statutory Liens for Preservation of Immovable Properties
or
Construction Work for Immovable Properties
Statutory liens registered in accordance with the provisions of the preceding two
articles may be exercised prior to mortgages.
Article 340 Registration of Statutory Liens for Sales of Immovable Properties
In
order to preserve the effectiveness of statutory liens for the sale of immovable
properties, a statement to the effect that the price
of the immovable properties or
interest on the same has not been paid must be registered simultaneously with the
execution of the
sales contract.
Article 341 Mutatis Mutandis Application of Provisions regarding Mortgages
In addition to the provisions of this
Section, the provisions regarding mortgages
shall apply mutatis mutandis to the effects of statutory liens, to the extent that
application
is not inconsistent with the nature of the same.
Chapter 9 Pledges
Section 1 General Provisions
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Article 342 Content of Pledges
Pledgees shall have the right to possess Thing received
from obligors or third
parties as security for their claims and to have their own claims paid prior to other
obligees out of that
Thing.
Article 343 Subject Matter of Pledges
Pledges cannot be created over a Thing that cannot be assigned to others.
Article
344 Creation of Pledges
The creation of a pledge shall take effect by delivering the subject matter of the
same to the obligee.
Article 345 Prohibition of Possession by Pledgors as Agents
A pledgee may not allow a pledgor to possess the Thing pledged on
behalf of the
pledgee.
Article 346 Scope of Secured Claims under Pledges
Pledges shall secure the principal, interest, penalties,
expenses of executing the
pledge, expense of preserving the Thing pledged and the compensation of damage
arising from failure to
perform obligations or latent defects in the Thing pledged;
provided, however, that this shall not apply if the act establishing
the pledge
provides otherwise.
Article 347 Retention of the Thing Pledged
Pledgees may retain the Thing pledged until the claims
provided for in the
preceding article are satisfied; provided, however, that this right cannot be asserted
against obligees who have
priority over the pledgees.
Article 348 Sub-pledges
Pledgees may sub-pledge the Thing pledged within the duration of their rights,
upon their own responsibility. In such cases, the pledgees shall be responsible for any
loss arising from the -pledge even if the
same is caused by force majeure.
Article 349 Prohibition on Disposition of the Thing Pledged by Contract
Pledgors cannot, either
by the acts establishing pledges or by contracts made prior
to the due dates for performance of their obligations, allow pledgees
to acquire
ownership of the Thing pledged as payment, nor promise to allow pledgees to dispose
of it in any manner other than is
prescribed by law.
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Article 350 Mutatis Mutandis Application of Provisions on
Rights of Retention and
Statutory Liens
The provisions of Articles 296 through 300 and those of Article 304 shall apply
mutatis
mutandis to pledges.
Article 351 Third Party Pledgors' Rights to Obtain Reimbursement
If persons who created pledges to secure
the obligations of others have performed
those obligations or have lost ownership of the Thing pledged due to the execution of
the
pledges, they shall have the right to obtain reimbursement from the obligors in
accordance with the provisions regarding guarantee
obligations.
Section 2 Pledges of Movables
Article 352 Requirements for the Perfection of Pledges of Movables
Pledgees
of movables cannot assert their pledges against third parties unless they
are in continuous possession of the Thing pledged.
Article 353 Recovery of Possession of the Thing Pledged
Pledgees
of movables may, if the pledged Thing is usurped, recover the same solely
by bringing actions for recovery of possession.
Article
354 Execution of Pledges of Movables
If claims of pledgees of movables are not performed, they may, limited to cases
where there
are reasonable grounds, demand from a court immediate appropriation
of the Thing pledged to the performance of the claims in accordance
with the
evaluation of an appraiser. In such cases, the pledgees of movables must notify the
obligors in advance of the demand.
Article 355 Order of Priority of Pledges of Movables
If more than one pledge is created with respect to the same movables, the
order of
priority of those pledges shall follow the chronological order of their creation.
Section 3 Pledges of Immovable
Properties
Article 356 Use and Profit by Pledgees of Immovable Properties
Pledgees of immovable property may use and receive
the profits from the
immovable property that is the subject matter of a pledge, in accordance with the
method of its use.
Article
357 Management Expenses Borne by Pledgees of Immovable Properties
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Pledgees
of immovable properties shall pay the expenses of management and
otherwise bear burdens in relation to the immovable properties.
Article 358 Prohibition on Charging of Interest by Pledgees of Immovable
Properties
Pledgees of immovable properties cannot
demand interest on their claims.
Article 359 Cases of Other Provisions in Act of Establishment
The provisions of the preceding
three articles shall not apply in cases where the
acts establishing pledges provide otherwise or execution against profits derived
from
the immovable properties as collateral hereinafter referring to the execution against
profits from secured immovable properties
provided for in Item ii of Article 180 of
the Civil Execution Act Law No. 4 of 1979 has been commenced.
Article
360 Duration of Pledges of Immovable Properties
1 The duration of pledges of immovable properties cannot exceed ten years. Even
if a longer period is provided for in the act establishing the pledge, the duration of
the same shall be ten years.
2 The
creation of pledges may be renewed; provided, however, that the duration of
the same cannot exceed ten years from the time of the
renewal.
Article 361 Mutatis Mutandis Application of Provisions on Mortgages
In addition to the provisions of this Section, the
provisions of the next chapter shall
apply mutatis mutandis to pledges of immovable properties to the extent that
application is
not inconsistent with the nature of the same.
Section 4 Pledges of Rights
Article 362 Subject Matter of Pledges of
Rights
1 Pledges may have property rights for their subject matters.
2 In addition to the provisions of this Section, the provisions
of the preceding three
Sections General Provisions, Pledges of Movables and Pledges of Immovable
properties shall apply
mutatis mutandis to pledges under the preceding
paragraph, to the extent that application is not inconsistent with the nature of
the
same.
Article 363 Creation of Pledges over Claims
When a pledges is to be created over a claim, and the delivery of an
instrument
evidencing it is required for its assignment, the creation of the pledge shall take
effect by the delivery of such
instrument.
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Article 364 Requirements for Perfection of Pledges over Nominative
Claims
If a pledge is created over a nominative claim, that pledge cannot be asserted
against third parties including third party
obligors unless notice of the creation of the
pledge is given to third party obligors in accordance with the provisions of Article
467, or unless the third party obligors acknowledge the same.
Article 365 Requirements for Perfection of Pledges over Debts Payable to Order
If a pledge is created over debts payable
to order, that pledge cannot be asserted
against third parties unless the creation of the pledge is endorsed on the instrument
of
the same.
Article 366 Collection of Claims by Pledgees
1 A pledgee may directly collect the claim that is the subject matter
of the pledge.
2 If monies are the subject matter of a pledged claim, the pledgee may collect the
same to the extent of the
portion that corresponds to the amount of the pledgee s
own claim.
3 If the due date of the pledged claim under the preceding
paragraph arrives prior
to the due date of the claim of the pledgee, the pledgee may have the third party
obligor deposit that
amount to be paid to the pledgee. In such cases, the pledge
shall exist over the amount so deposited.
4 If the subject
matter of the pledged claim is not monies, the pledgee shall have
the pledge over the Thing received as performance of the obligation.
Article 367
Deleted
Article 368
Deleted
Chapter 10 Mortgages
Section 1 General Provisions
Article 369
Content of Mortgages
1 A Mortgagee shall have the right to receive the performance of his/her claim
prior to other obligees
out of the immovable properties that the obligor or a third
party provided to secure the obligation without transferring possession.
2 Superficies and emphyteusis can be the subject matter of a mortgage. In such
cases, the provisions of this Chapter
shall apply mutatis mutandis.
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Article 370 Scope of Effect of Mortgages
A mortgage
shall extend to the Things that is an integral part of immovable
properties that is the subject matter of the mortgage hereinafter
referred to as
"Mortgaged Immovable Properties" except for buildings on the mortgaged land;
provided, however, that this
shall not apply in cases where the act establishing the
mortgage provides otherwise or the obligee can rescind the act of the obligor
in
accordance with the provisions of Article 424.
Article 371
If there is a default with respect to a claim secured by a mortgage,
the mortgage
shall extend to the fruits of the Mortgaged Immovable Properties derived after the
default.
Article 372 Mutatis Mutandis
Application of Provisions on Right of Retention
The provisions of Article 296, Article 304 and Article 351 shall apply mutatis
mutandis to mortgages.
Section 2 Effect of Mortgages
Article 373 Order of Priority of Mortgages
If more than one
mortgage is created with respect to the same immovable
properties, the order of priority of those mortgages shall follow the chronological
order of their registration.
Article 374 Changes in Order of Priority of Mortgages
1 The order of priority of mortgages may
be changed with the agreement of all
mortgagees; provided, however, that, if there are interested persons, the consent of
the
same must be obtained.
2 The changes in order under the preceding paragraph shall not take effect unless
registered.
Article
375 Scope of Secured Claims under Mortgages
1 If mortgagees have rights to demand periodic payments including interest, they
may exercise their mortgages solely with respect to payments that have fallen due
in the most recent two years; provided, however,
that, if special registration is
effected with respect to prior periodical payments that have fallen due, the
mortgagees shall
not be precluded from exercising their mortgages as from the
time of that registration.
2 In cases where mortgagees have rights
to demand the compensation for damages
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resulting from defaults in obligations,
the provisions of the preceding paragraph
shall apply mutatis mutandis to the damages of the most recent two years;
provided,
however, that the aggregate period including the interest and other
periodical payments may not exceed two years.
Article 376 Disposition of Mortgages
1 A mortgagee may apply his/her mortgage to secure other claims, or assign or
waive his/her mortgage, or its order of priority,
for the benefit of other obligees of
the same obligor.
2 In the cases provided for in the preceding paragraph, if a mortgagee
disposes of
his/her mortgage for the benefit of two or more persons, the order of priority of the
rights of persons who receive
the benefit of that disposition shall follow the
chronological order noted in the registration of the mortgage.
Article 377 Requirements
for Perfection of Disposition of Mortgages
1 In the cases in the preceding article, in accordance with the provisions of Article
467, mortgagees cannot assert the disposition of mortgages against principal
obligors, guarantors, mortgagors or their respective
successors unless the
disposition is notified to the primary obligors or the principal obligors acknowledge
that disposition.
2 If the principal obligors have received the notice or given acknowledgement
under the provisions of the preceding paragraph,
performance effected without the
approval of the persons who receive the benefit of the disposition of mortgages
cannot be asserted
against those beneficiaries.
Article 378 Payment of Mortgage Proceeds
If a third party who purchases the ownership or superficies
of Mortgaged
Immovable Properties pay the price of the same to the relevant mortgagee at the
request of the mortgagee, the mortgage
shall be extinguished for the benefit of that
third party.
Article 379 Claims for Extinction of Mortgages
A third party acquirer
of Mortgaged Immovable Properties may make a claim for
the extinction of a mortgage as prescribed in Article 383.
Article 380
No primary obligor, guarantor or successor of the same may make a claim for the
extinction of a mortgage.
Article 381
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A third party acquirer of Mortgaged Immovable Properties that is subject to a
condition
precedent may not make a claim for the extinction of a mortgage whilst
whether or not the condition precedent is satisfied is still
undetermined.
Article 382 Timing of Claims for Extinction of Mortgages
A third party acquirer of Mortgaged Immovable Properties
must make a claim for
the extinction of a mortgage before attachment by auction as a result of the execution
of the mortgage takes
effect.
Article 383 Procedures for Claims for Extinction of Mortgages
If a third party acquirer of Mortgaged Immovable Properties
intends to make a
claim for the extinction of a mortgage, he/she must send the documents listed below
to each registered obligee:
i A document that specifies the cause and date of the acquisition, the name and
address of the assignor and the acquirer,
the nature, location and price of the
Mortgaged Immovable Properties and burdens of the acquirer;
ii A certificate
of registered matters regarding the Mortgaged Immovable
Properties limited to certificates certifying all registered matters
currently in
effect ; and
iii A document to the effect that, if the obligee does not file a petition for auction
by executing the mortgage within two months, the third party acquirer of the
immovable properties will pay or deposit
the price provided for in Item i or an
amount specifically designated in accordance with the order of priority of claims.
Article 384 Deemed Approval of Obligees
In the cases listed below, obligees who have received the documents listed in each
item
of the preceding article shall be deemed to have approved the price or amount
that the third party acquirer of Mortgaged Immovable
Properties has offered as
stated in the document listed in Item iii of that article:
i If the obligee does not file
a petition for auction by executing the mortgage
within two months after receipt of the documents listed in each item of the
preceding
article;
ii If the obligee withdraws a petition under the preceding item;
iii If a ruling dismissing a petition
under Item i has become final and binding;
or
iv If a ruling rescinding auction procedures based on a petition
under Item i
excluding rulings under the provisions of Paragraph 3 of Article 63 or
Paragraph 3 of Article 68-3 of
the Civil Execution Act applied mutatis mutandis
under Article 188 of the same act, or under the provisions of Paragraph 2
of
Article 183 of the same Act in cases where the certified copy under Item v,
- 36 -
Paragraph 1 of the same article is provided has become final and binding.
Article 385 Notice
of Petitions for Auction
If an obligee who has received the documents listed in each item of Article 383 files
a petition under
Item i of the preceding article, he/she must give notice to such
effect to the obligor and assignor of the Mortgaged Immovable
Properties within the
period under that item.
Article 386 Effect of Claims for Extinction of Mortgages
A mortgage shall be extinguished
if all registered obligees approve the price or
amount offered by the third party acquirer of the Mortgaged Immovable Properties
,
and the third party acquirer of the Mortgaged Immovable Properties has paid or
deposited the price or amount approved.
Article 387 Perfection of Leases with Registered Consent of Mortgagees
1 If all persons holding mortgages, the registrations
of which precede the
registration of a lease, give their consent, and such consents are registered, the
lease so registered can
be asserted against those mortgagees who gave their
consent.
2 For a mortgagee to give the consent under the preceding paragraph,
the
approval of the persons who hold rights for which the mortgage is the object and
other persons who will suffer detriment
as a result of the consent of the mortgagee
must be obtained.
Article 388 Statutory Superficies
In cases where land and a building
on the land belong to the same owner, if a
mortgage is created with respect to that land or building, and the execution of that
mortgage
results in the creation of different owners, it shall be deemed that a
superficies has been created with respect to that building.
In such cases, the rent
shall be fixed by the court at the request of the parties.
Article 389 Auction of Buildings on Mortgaged
Lands
1 If a building is constructed on mortgaged land after the creation of a mortgage,
the mortgagee may auction the building
together with the land; provided, however,
that his/her right of priority may be exercised solely against the proceeds of the
land.
2 The provisions of the preceding paragraph shall not apply in cases where the
owner of that building has rights
with respect to the possession of the mortgaged
land that can be asserted against the mortgagee.
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Article 390 Purchases of Mortgaged Immovable Properties by Third Party
Acquirers
A third party acquirer
of Mortgaged Immovable Properties may be the purchaser
at the auction of the same.
Article 391 Claims for Reimbursement of Expenses
by Third Party Acquirers of
Mortgaged Immovable Properties
If a third party acquirer of Mortgaged Immovable Properties has incurred
necessary or beneficial expenses with respect to the Mortgaged Immovable
Properties, he/she shall be entitled to obtain reimbursement
of the same out of the
proceeds of the Mortgaged Immovable Properties prior to other obligees, in
accordance with the distinctions
in Article 196.
Article 392 Distribution of Proceeds in cases of Joint Mortgage
1 In cases where an obligee holds mortgages
on several immovable properties to
secure the same claim, if the proceeds of those immovable properties are to be
distributed simultaneously, the obligee shall divide the
burden of the claim in
proportion to the value of each immovable property.
2 In cases where an obligee holds mortgages on several
immovable properties to
secure the same claim, if the proceeds from a particular immovable property alone
are to be distributed,
the mortgagee may receive the payment of his/her entire
claim out of those proceeds. In such cases, subordinated mortgagees may
exercise
their mortgages in subrogation of that mortgagee, up to the amount that that
mortgagee who receives payment would otherwise
be entitled to receive from the
proceeds of other immovable properties, in accordance with the provisions of the
preceding paragraph.
Article 393 Note in Registration of Subrogation in case of Joint Mortgages
A person who exercises a mortgage by way of subrogation
under the provisions of
the second sentence of Paragraph 2 of the preceding article may note his/her
subrogation in the registration
of that mortgage.
Article 394 Payment from Assets other than Mortgaged Immovable Properties
1 A mortgagee may receive payment
from assets other than the Mortgaged
Immovable Properties, limited to the extent of the portion of his/her claim not paid
from
the proceeds of that Mortgaged Immovable Properties.
2 The provisions of the preceding paragraph shall not apply to cases where
the
proceeds of other assets are to be distributed prior to the proceeds of the
Mortgaged Immovable Properties. In such cases,
each other obligee may demand
that the amount to be distributed to the mortgagee be deposited in order to have
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the mortgagee receive payment under the provisions of that paragraph.
Article 395 Suspension
of Delivery by Users of Mortgaged Buildings
1 Any person who uses or receives profits from a building subject to a mortgage
by
virture of a lease that cannot be asserted against the mortgagee, and who is listed
as follows in the following paragraph
referred to as "Mortgaged Building User"
shall not be required to deliver that building to the purchaser thereof until six
months
have elapsed from the time when the purchaser purchased that building at
auction:
i A person who has been using or receiving
profits from the building since prior
to the commencement of auction procedures; or
ii A person who is using or
receiving profits from the building by virtue of a
lease given after the commencement of auction procedures by the administrator
of compulsory administration or execution against profits from secured
immovable properties.
2 The provisions
of the preceding paragraph shall not apply in cases where the
purchaser issues a notice to the Mortgaged Building User demanding
payment of
consideration for a period of one month or more with respect to the use of the
building in that paragraph that has
occurred after the time of purchase by the
purchaser, establishing a reasonable period, and no payment is made within that
reasonable
period.
Section 3 Extinction of Mortgages
Article 396 Extinctive Prescription of Mortgages
No mortgage shall be
extinguished by prescription in relation to obligors and
mortgagors unless it is extinguished simultaneously with the claim the mortgage
secures.
Article 397 Extinction of Mortgages by Acquisition by Prescription of Mortgaged
Immovable Properties
If a person
who is neither an obligor nor a mortgagor has possessed the Mortgaged
Immovable Properties in complete conformity with the requirements
for acquisitive
prescription, the mortgage shall be extinguished thereby.
Article 398 Renouncement of Mortgaged Superficies
Even
if a holder of superficies or a emphyteuta who created mortgage on his/her
superficies or emphyteusis renounces his/her rights, the
renouncement cannot be
asserted against the mortgagee.
- 39 -
Section 4
Revolving Mortgages
Article 398-2 Revolving Mortgages
1 Mortgages may be created, by an establishing act, in order to secure
unspecified
claims of a certain scope, up to the limit of a maximum amount.
2 The scope of the unspecified claims to be
secured by the mortgage under the
provisions of the preceding paragraph hereinafter referred to as "Revolving
Mortgage" must be prescribed by limiting the scope to claims arising from specific
contracts with the obligor for continuous
transactions or other claims arising from
certain kinds of transactions with the obligor.
3 Claims that accrue continuously
with the obligor pursuant to a specific cause, or
claims on negotiable instruments or checks may be treated as claims that are
to be
secured by a Revolving Mortgage, notwithstanding the provisions of the preceding
paragraph.
Article 398-3 Scope of Secured
Claims under Revolving Mortgages
1 A revolving mortgagee may exercise his/her Revolving Mortgage up to the
maximum amount
with respect to all fixed payments of principal as well as
periodical payments including interest and compensation for damages
resulting
from failure to perform obligations.
2 In cases where a claim on a negotiable instrument or check acquired by
way of
causes other than the transactions with the obligor is treated as a claim to be
secured by a Revolving Mortgage, if any
of the following grounds exist, such
Revolving Mortgage may be exercised only with respect to claims acquired before
such grounds
arose; provided, however, that even with respect to claims acquired
after such grounds arose, the exercise of the Revolving Mortgage
shall not be
precluded as far as the claims were acquired without knowledge of those grounds:
i The suspension of payments
by the obligor;
ii A petition for the commencement of bankruptcy procedures, the
commencement
of rehabilitation procedures, the commencement of
reorganization procedures or the commencement
for special liquidation with
respect to the obligor; or
iii A petition for auction in relation to Mortgaged Immovable
Properties or
attachment for delinquent taxes.
Article 398-4 Alterations in Scope of Secured Claims under Revolving
Mortgages
and of Obligors
1 The scope of the claims to be secured by a Revolving Mortgage may be altered if
the alteration
is effected before the principal is fixed. The same shall likewise
apply with respect to alterations of obligors.
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2 In order to effect the alterations under the preceding paragraph,
it is not
required that the approval of third parties including subordinated obligees be
obtained.
3 If the alteration under
Paragraph 1 is not registered before the principal is fixed,
it shall be deemed that such alteration was not effected.
Article
398-5 Alterations in Maximum Amounts of Revolving Mortgages
Alterations in the maximum amount of a Revolving Mortgage cannot be
made
unless the approval of the interested parties is obtained.
Article 398-6 Provision of Date for Fixing Principal of Revolving
Mortgage
1 With respect to the principal secured by a Revolving Mortgage, the date when
the principal is to be fixed may be
prescribed or changed.
2 The provisions of Paragraph 2 of Article 398-4 shall apply mutatis mutandis to
the cases under the
preceding paragraph.
3 The date under Paragraph 1 must be within five years of the day when the date
was prescribed or changed.
4 If registration with respect to an alteration in the date under Paragraph 1 is not
effected before the old date, the principal
secured shall be fixed on that old date.
Article 398-7 Assignments of Secured Claims under Revolving Mortgages
1 A person who acquires a claim from
a revolving mortgagee before the principal is
fixed may not exercise the Revolving Mortgage with respect to such claim.
The
same shall likewise apply to a person who made payment for or on behalf of an
obligor before the principal was fixed.
2 If an obligation is assumed before the principal is fixed, the revolving mortgagee
may not exercise his/her Revolving Mortgage
with respect to the obligation of the
person who assumes the obligation.
3 If any novation due to a change of obligee or obligor
is effected before the
principal is fixed, the parties may not transfer the Revolving Mortgage to the
obligations after the novation,
notwithstanding the provisions of Article 518.
Article 398-8 Inheritances of Revolving Mortgagees or Obligors
1 If an inheritance
of a revolving mortgagee commences before the principal is
fixed, the Revolving Mortgage shall secure the claims that exist at
the time of the
commencement of the inheritance and shall otherwise secure claims the heir
prescribed by agreement between the
heirs and the revolving mortgagor acquires
after the commencement of the inheritance.
2 If an inheritance of an obligor commences
before the principal is fixed, the
Revolving Mortgage shall secure the obligations that exist at the time of the
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commencement of the inheritance and shall otherwise secure the claims that the
heir
prescribed by agreement between the revolving mortgagee and the revolving
mortgagor assumes after the commencement of the inheritance.
3 The provisions of Paragraph 2 of Article 398-4 shall apply mutatis mutandis to
cases where an agreement is made under the
preceding two paragraphs.
4 If the agreements under Paragraph 1 and Paragraph 2 are not registered within
six months of the
commencement of the inheritance, principal secured shall be
deemed to have been fixed at the time of the commencement of the inheritance.
Article 398-9 Mergers of Revolving Mortgagees or Obligors
1 If there is a merger with respect to a revolving mortgagee before
the principal is
fixed for that revolving mortgagee, the Revolving Mortgage shall secure the claims
that exist at the time of
the merger and shall otherwise secure claims that a
juridical person that survives the merger or a juridical person that is incorporated
by the merger acquires after the merger.
2 If there is a merger with respect to an obligor before the principal is fixed for
that obligor, the Revolving Mortgage shall secure the obligations that exist at the
time of the merger and shall otherwise secure
the obligations that a juridical
person that survives the merger or a juridical person that is incorporated by the
merger assumes
after the merger.
3 In the cases provided for in the preceding two paragraphs, the revolving
mortgagor may demand that the principal
secured be fixed; provided, however, that
this shall not apply, in the cases provided for in the preceding paragraph, if the
relevant obligor is the revolving mortgagor.
4 If a demand is made in accordance with the provisions of the preceding
paragraph,
the principal secured shall be deemed to have been fixed at the time of
the merger.
5 The demand under the provisions of Paragraph
3 may not be made if two weeks
have elapsed since the day when the revolving mortgagor acquired knowledge of
the merger. The
same shall apply if one month has elapsed from the day of the
merger.
Article 398-10 Company Splits of Revolving Mortgagees or
Obligors
1 If, before the principal is fixed, a split in which the relevant revolving mortgagee
is the company to be split is
effected, the Revolving Mortgage shall secure the
claims that exist at the time of the split and shall otherwise secure claims
acquired
after the split by the split company and the company incorporated by the split, or
claims acquired after the split by the company that succeeded
to some or all of the
rights and obligations of the split company regarding its business.
2 If, before the principal is fixed,
a split in which the relevant obligor is the
- 42 -
company to be split is effected,
the Revolving Mortgage shall secure the obligations
that exist at the time of the split and shall otherwise secure obligations
that are
assumed after the split by the split company and the company incorporated by the
split, or claims acquired after the
split by the company that assumed some or all of
the rights and obligations of the split company regarding its business.
3 The
provisions of Paragraphs 3 through 5 of the preceding article shall apply
mutatis mutandis to cases under the preceding two paragraphs.
Article 398-11 Disposition of Revolving Mortgages
1 Before the principal is fixed, a revolving mortgagee cannot dispose of a
Revolving
Mortgage under the provisions of Paragraph 1 of Article 376; provided, however,
that he/she shall not be precluded
from applying that Revolving Mortgage to secure
other claims.
2 The provisions of Paragraph 2 of Article 377 shall not apply
to payments made
before the principal is fixed in the cases provided for in the proviso to the
preceding paragraph.
Article
398-12 Assignments of Revolving Mortgages
1 Before the principal is fixed, a revolving mortgagee may assign a Revolving
Mortgage,
with the approval of the revolving mortgagor.
2 A revolving mortgagee may divide his/her Revolving Mortgage into two
Revolving
Mortgages and assign either of the same in accordance with the
provisions of the preceding paragraph. In such cases, the rights
for which that
Revolving Mortgage is the subject matter shall be extinguished with respect to the
Revolving Mortgage that was
assigned.
3 In order to effect an assignment under the provisions of the preceding
paragraph, the approval of the person who
holds the rights for which that
Revolving Mortgage is the subject matter must be obtained.
Article 398-13 Partial Assignments
of Revolving Mortgages
Before the principal is fixed, a revolving mortgagee may, with the approval of the
revolving mortgagor,
effect a partial assignment of the Revolving Mortgage
hereinafter in this Section referring to assignments of Revolving Mortgages
that the
assignor effects without dividing the Revolving Mortgage in order to co-own the same
with the assignee .
Article 398-14
Co-ownership of Revolving Mortgages
1 Co-owners of a Revolving Mortgage shall be paid in proportion to the amount of
their respective
claims; provided, however, that, if before the principal is fixed, a
proportion other than the above is agreed, or if it is agreed
that a certain person
- 43 -
should be paid prior to the others, that agreement shall
prevail.
2 A co-owner in a Revolving Mortgage may, with the consent of the other
co-owners, assign rights of the same in accordance
with the provisions of
Paragraph 1 of Article 398-12.
Article 398-15 Assignments or Waivers of Order of Priority of Mortgages
and
Assignments or Partial Assignments of Revolving Mortgages
If a revolving mortgagee who has accepted an assignment or waiver
of the order of
priority of a mortgage has assigned or partially assigned his/her Revolving Mortgage,
the assignee shall receive
the benefit of the assignment or waiver of that order of
priority.
Article 398-16 Joint Revolving Mortgages
The provisions of
Articles 392 and 393 shall apply with respect to Revolving
Mortgages, limited to cases where, simultaneously with the establishment
of the
same, it is registered that a Revolving Mortgage has been established on several
immovable properties to secure the same claim.
Article 398-17 Alterations of Joint Revolving Mortgages
1 An alteration in the scope, obligors or maximum amount of the claims to be
secured, or assignment
or partial assignment of the Revolving Mortgages for which
registration is effected in accordance with the preceding article shall
not take effect
unless registration is effected with respect to all immovable properties over which
that Revolving Mortgages
are established.
2 The principal that is to be secured by the Revolving Mortgages for which the
registration under the preceding
article is effected shall be fixed even where
grounds that would fix the same with respect to one immovable property alone
arise.
Article 398-18 Aggregate Revolving Mortgages
A person who has Revolving Mortgages on several immovable properties may
exercise
his/her right of priority with respect to the proceeds of each immovable
property up to the respective maximum amounts, except for
cases provided for in
Article 398-16.
Article 398-19 Requests for Fixing of Principal of Revolving Mortgages
1 If three years
have elapsed from the time of the creation of a Revolving
Mortgage, the revolving mortgagor may request the fixing of the principal
secured.
In such cases, the principal secured shall be fixed when two weeks have elapsed
since the time of that request.
- 44 -
2 A revolving mortgagee may request the fixing of the principal secured
at any
time. In such cases, the principal secured shall be fixed on the request of the
same.
3 The provisions of
the preceding two paragraphs shall not apply in cases where
the date on which the principal secured is to be fixed is prescribed.
Article 398-20 Grounds for Fixing of Principal of Revolving Mortgages
1 The principal secured by a Revolving Mortgage shall
be fixed in the following
cases:
i If the revolving mortgagee has filed, with respect to the Mortgaged Immovable
Properties, a petition for auction or execution against profits from secured
immovable properties or the attachment
under the provisions of Article 304 cited
in Article 372; provided, however, that this provision shall apply only in cases
where the commencement of either auction procedures or execution procedures
against secured immovable properties
to realize profits, or an attachment has
been effected;
ii If the revolving mortgagee has effected an attachment
for delinquent taxes
against the Mortgaged Immovable Properties;
iii If two weeks have elapsed from the time when
the revolving mortgagee
acquired knowledge of the commencement of auction procedures or attachment
for delinquent
taxes against the Mortgaged Immovable Properties; or
iv If the obligor or revolving mortgagor has become subject to a ruling
for the
commencement of bankruptcy procedures.
2 If the effect of the commencement of auction procedures, the attachment
under
Item iii of the preceding paragraph or the ruling to commence bankruptcy
procedures under Item iv of
that paragraph has been extinguished, it shall be
deemed that the principal secured was not fixed; provided, however, that this
shall
not apply if any person has acquired that Revolving Mortgage or a right for which
the Revolving Mortgage is the subject
matter on the assumption that the principal
was fixed.
Article 398-21 Requests for Reductions in Maximum Amount of
Revolving
Mortgages
1 After the principal is fixed, the revolving mortgagor may request a reduction in
the maximum amount
of that Revolving Mortgage, to the amount of the obligations
actually in existence plus the amount of the periodical payments including
interest
and the amount of damages due to default in obligations that will arise in the
following two years.
2 As to reductions
in the maximum amount of Revolving Mortgages for which
registration under Article 398-16 has been effected, the request under the
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preceding paragraph shall be sufficient if made with respect to one of those
immovable properties.
Article
398-22 Requests for Extinction of Revolving Mortgages
1 If the amount of the obligations actually in existence after the principal
is fixed
exceeds the maximum amount of the Revolving Mortgage, a person who created
his/her Revolving Mortgage to secure obligations
of others or a third party who
acquired ownership, superficies, emphyteusis or a lease that can be asserted
against any third
party with respect to the Mortgaged Immovable Properties, may
request the extinction of that Revolving Mortgage by tendering or
depositing an
amount equivalent to that maximum amount. In such cases, that tender or
deposit shall have the effect
of payment.
2 Revolving Mortgages for which registrations are effected under Article 398-16
shall be extinguished if the request
for extinction in accordance with the preceding
paragraph is made with respect to one immovable property.
3 The provisions of
Articles 380 and 381 shall apply mutatis mutandis to the
requests for extinction under Paragraph 1.
Chapter 2 Contracts
Section 1 General Provisions
Subsection 1 Formation of Contracts
Article 521 Offers that Specify Period
for Acceptance
1 An offer which specifies a period for acceptance may not be revoked.
2 If an offeror does not receive notice
of acceptance of the offer set forth in the
preceding paragraph within the period referred to in the same paragraph, the offer
shall cease to be effective.
Article 522 Late Arrival of Notices of Acceptance
1 Even in cases where the notice of acceptance
of the offer under Paragraph 1 of
the preceding Article arrives after the lapse of the period referred to in the same
paragraph,
if the offeror is in a position to know that the notice was dispatched at
a time which, under normal circumstances, would have
allowed the notice to arrive
within that period, the offeror must dispatch a notice of late arrival to the other
party without
delay; provided, however, that this shall not apply when the offeror
dispatches the notice of delay before the arrival of the notice
of acceptance.
2 When the offeror fails to give the notice of late arrival referred to in the main
clause of the preceding paragraph,
the notice of acceptance shall be deemed to have
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arrived within the period
referred to in Paragraph 1 of the preceding Article.
Article 523 Effect of Delayed Acceptance
The offeror may deem a delayed
acceptance to be a new offer.
Article 524 Offers that do not Specify Period for Acceptance
An offer made to a person at a distance
without specifying a period for acceptance
may not be revoked until the lapse of a reasonable period for the offeror to receive a
notice of acceptance.
Article 525 Offeror's Death or Loss of Capacity to Act
The provisions of Paragraph 2 of Article 97 shall
not apply where the offeror
expresses his/her intention to the contrary, or the other party has come to know the
fact of the offeror's
death or loss of capacity to act.
Article 526 Time of Formation of Contract between Persons at Distance
1 A contract between
persons at a distance shall be formed upon dispatch of the
notice of acceptance.
2 In cases where no notice of acceptance is
required due to the offeror's
manifestation of intention or usage of trade, the contract shall be formed upon the
occurrence
of any fact which ought to be regarded as a manifestation of intention of
acceptance.
Article 527 Late Arrival of Notices of
Revocation of Offer
1 Even if a notice to revoke an offer arrives after the dispatch of the acceptance
notice, if the offeree
is in a position to know that the notice was dispatched at a
time which, under normal circumstances would have allowed the notice to arrive
before the dispatch of the acceptance
notice, the offeree must dispatch a notice of
the late arrival to the offeror without delay.
2 If the offeree fails to give
the notice of late arrival referred to in the preceding
paragraph, it shall be deemed that no contract was formed.
Article 528
Acceptances which Modify Offer
If the offeree has accepted the offer by adding any condition or by making any
other modification,
it shall be deemed that the offeree has refused the offer and has
made a new offer.
Article 529 Advertisements Offering Prizes
A person who places an advertisement to the effect that any person who performs a
defined act will be given a set reward hereinafter
in this Subsection referred to as
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an "advertiser offering prizes" shall
be obligated to give the reward to the person
who has performed the act.
Article 530 Revocation of Advertisements Offering Prizes
1 In the case set forth in the preceding Article, the advertiser offering prizes may
revoke its advertisement using a method
identical to that used for the above
advertisement whilst no person has completed the designated act; provided,
however, that
this shall not apply when a statement to the effect that the offer will
not be revoked was made in the advertisement.
2 Where
revocation may not be carried out by the method provided in the main
clause of the preceding paragraph, the revocation may be carried
out by another
method. In such cases, the revocation shall only be effective against persons with
knowledge of the revocation.
3 If the advertiser offering prizes specifies the period during which the designated
act must be performed, it shall be presumed
that the advertiser has waived its
right to revoke.
Article 531 Right to Receive Rewards in Advertisements Offering Prizes
1
If more than one person has performed the act designated in the advertisement,
only the person who performed the act first shall
be entitled to receive the reward.
2 Where two or more persons have performed the act set forth in the preceding
paragraph simultaneously,
each shall be entitled to receive an equal share of the
reward; provided, however, that the person entitled to the reward shall
be selected
by lot if the reward is by nature indivisible, or the advertisement provides that
only one person is entitled to
receive the reward.
3 The provisions of the preceding two paragraphs shall not apply if the
advertisement expresses any intention
to the contrary.
Article 532 Advertisement Offering Prizes to Most Outstanding Applicant
1 If, in cases where two or more persons
have performed the act designated in the
advertisement, the reward is to be given only to the most outstanding applicant,
the
advertisement shall be effective only if it specifies the application period.
2 In the cases of the preceding paragraph, the most
outstanding applicant shall be
judged by the person specified in the advertisement and if no such person is
specified in the
advertisement, by the person who places the advertisement.
3 Applicants may not raise any objection to the judge's decision referred
to in the
preceding paragraph.
4 The provision of the second paragraph of the preceding Article shall apply
mutatis mutandis
to cases where the acts of two or more persons are judged to be
equal.
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Subsection 2 Effect of Contracts
Article 533 Defense for Simultaneous Performance
A party to a bilateral contract
may refuse to perform his/her own obligation until
the other party tenders the performance of his/her obligation; provided, however,
that
this shall not apply if the obligation of the other party is not yet due.
Article 534 Obligees to Assume Risk
1 In cases
where the purpose of a bilateral contract is the creation or transfer of
real rights regarding specified things, if the things have been lost or damaged due
to reasons not attributable to the obligor, such loss or damage shall fall on the
obligee.
2 The provisions of the preceding
paragraph shall apply to any contract regarding
unspecified things from the time when the things have been identified in
accordance
with the provisions of Paragraph 2 of Article 401.
Article 535 Assumption of Risk in Bilateral Contract with Condition Precedent
1 The provisions of the preceding Article shall not apply where the subject matter
of a bilateral contract with conditions precedent
is lost whilst the conditions are
pending.
2 If the subject matter of a bilateral contract with conditions precedent has been
lost or damaged due to reasons not attributable to the obligor, the loss or damage
shall fall on obligee.
3 In cases where
the subject matter of a bilateral contract with conditions
precedent has been lost or damaged due to reasons attributable to the
obligor, if
the condition has been satisfied, the obligee may, at his/her choice, demand
performance or exercise the obligee's
right to cancel. In such cases, claims for
damages shall not be precluded.
Article 536 Obligors' Assumption of Risk
1
Except in the cases provided for in the preceding two Articles, if the performance
of any obligation has become impossible due
to reasons not attributable to either
party, the obligor shall not have the right to receive performance in return.
2 If the
performance of any obligation has become impossible due to reasons
attributable to the obligee, the obligor shall not lose his/her
right to receive
performance in return. In such cases, if the obligor gains any benefit as a result of
being released from his/her
own obligation, the obligor must reimburse the obligee
for the benefit.
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Article
537 Contracts for the Benefit of Third Parties
1 If one of the parties promises in a contract that he/she will tender a certain
performance to any third party, the third party shall have the right to claim that
performance directly from the obligor.
2
In the cases set forth in the preceding paragraph, rights of the third party shall
accrue when the third party has expressed
his/her intention to the obligor to enjoy
the benefit of the contract under that paragraph.
Article 538 Determination of Rights
of the Third Party
After rights of the third party have come into existence in accordance with the
provisions of the preceding
Article, the parties may not modify or extinguish those
rights.
Article 539 Obligors' Defense
The obligor may raise the defense
founded on the contract referred to in Paragraph
1 of Article 537 against a third party who is to enjoy the benefit of the contract.
Subsection 3 Cancellation of Contracts
Article 540 Exercise of Right to Cancel
1 If one of the parties has a
right to cancel in accordance with the provisions of the
contract or law, the cancellation shall be effected by manifestation of
intention to
the other party.
2 The manifestation of intention under the preceding paragraph may not be
revoked.
Article
541 Right to Cancel for Delayed Performance
In cases where one of the parties does not perform his/her obligations, if the other
party demands performance of the obligations, specifying a reasonable period and no
performance is tendered during that period, the
other party may cancel the contract.
Article 542 Right to Cancel for Delayed Performance where Time is of the Essence
In cases
where, due to the nature of the contract or a manifestation of intention by
the parties, the purpose of the contract cannot be achieved
unless the performance is
carried out at a specific time and date or within a certain period of time, if one of the
parties has failed
to perform at the time that period lapses, the other party may
immediately cancel the contract without making the demand referred to in the
preceding Article.
Article 543 Right
to Cancel for Impossibility of Performance
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If performance has become impossible,
in whole or in part, the obligee may cancel
the contract; provided, however, that this shall not apply if the failure to perform
the
obligation is due to reasons not attributable to the obligor.
Article 544 Indivisible Nature of Right to Cancel
1 If one
party is constituted of two or more persons, the cancellation of the
contract may be effected only by, or against, all of those
persons.
2 In the case set forth in the preceding paragraph, if the right to cancel is
extinguished with respect to one of the
persons who constitute a party, it shall also
be extinguished with respect to the other persons.
Article 545 Effect of Cancellation
1 If one of the parties exercises his/her right to cancel, each party shall assume an
obligation to restore the other party
to that other party's original position;
provided, however, that this shall not prejudice the rights of a third party.
2 In
the case set forth in the main clause of the preceding paragraph, if any
monies are to be refunded, interest must accrue from the
time of the receipt of
those monies.
3 The exercise of the right to cancel shall not preclude claims for damages.
Article
546 Cancellation of Contract and Simultaneous Performance
The provisions of Article 533 shall apply mutatis mutandis to the preceding
Article.
Article 547 Extinguishment of Right to Cancel by Demand
If no period is provided for the exercise of the right to cancel,
the other party may
issue a notice of demand to the holder of the right to cancel, specifying a reasonable
period, to the effect
that the holder of the right to cancel is to give a definite answer
as to whether or not the right will be exercised within that
period. In such cases, if
no notice of cancellation is received within that period, the right to cancel shall be
extinguished.
Article 548 Extinguishment of Right to Cancel by Acts of Holder of Right to Cancel
1 The right to cancel shall be extinguished
if the holder of the right to cancel has
significantly damaged, or has become unable to return, the subject matter of the
contract
due to his/her act or negligence, or has converted the subject matter into
any other kind of thing by processing or alteration.
2 The right to cancel shall not be extinguished if the subject matter of the contract
has been lost or damaged due to reasons
not attributable to any act or negligence
of the holder of the right to cancel.
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51 -
Section 2 Gifts
Article 549 Gifts
Gifts shall become effective by the manifestation by one of the parties of his/her
intention to give his/her property to the other party gratuitously, and the acceptance
of the other party thereof.
Article 550
Revocation of Gift Not in Writing
Gifts not in writing may be revoked by either party; provided, however, that this
shall not apply
to any portion of the gift for which performance has been completed.
Article 551 Warranty by Donor
1 The donor shall not be
liable for any defect in or absence of the thing or right
that is the subject matter of the gift; provided, however, that this
shall not apply if
the donor has knowledge of the defect or absence and fails to inform the donee
thereof.
2 With respect
to encumbered gifts, the donor shall assume a warranty identical to
that borne by the seller, to the extent of that encumbrance.
Article 552 Periodic Gifts
Periodic gifts shall lose its effect on the death of the donor or the donee.
Article 553 Encumbered
Gifts
With respect to gifts with burden, in addition to the provisions of this Section, the
provisions regarding bilateral contracts
shall apply mutatis mutandis, to the extent
those provisions are not inconsistent with the nature of gifts with burden.
Article 554 Gifts on Donor's Death
With respect to gifts
that become effective on the death of the donor, the provisions
regarding testamentary gifts shall apply mutatis mutandis, to the
extent they are not
inconsistent with the nature of gifts that become effective on the death of the donor.
Section 3 Sale
Subsection 1 General Provisions
Article 555 Sale
A sale shall become effective when one of the parties promises
to transfer a certain
real rights to the other party and the other party promises to pay the purchase
money for it.
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Article 556 Pre-contract of Sales Exercisable by One Party
1 A pre-contract to sell or
purchase made by one party shall take the effect of a
sale when the other party has manifested his/her intention to complete such
sale.
2 If no period is provided in relation to the manifestation of intention set forth in
the preceding paragraph, the other
party to the pre-contact may issue a notice of
demand to the other party, specifying a reasonable period, to the effect that the
other party is to give a definite answer as to whether or not he/she will complete
the sale within that period. In such cases,
if the other party fails to give a definite
answer within that period, the pre-contract of sale by one party shall lose its effect.
Article 557 Earnest Money
1 When the buyer delivers earnest money to the seller, the buyer may cancel the
contract by forfeiting
his/her earnest money or the seller may cancel the contract
by reimbursing twice its amount, until either party commences performance
of the
contract.
2 The provisions of Paragraph 3 of Article 545 shall not apply to cases set forth in
the preceding paragraph.
Article 558 Expenses of Contracts for Sale
The expenses of contracts for sale shall be borne equally by both parties.
Article
559 Mutatis Mutandis Application to Contracts for Value
The provisions of this Section shall apply mutatis mutandis to contracts
for value
other than contracts for sale; provided, however that this shall not apply when it is
not permitted by the nature of the
contract for value.
Subsection 2 Effect of Sale
Article 560 Seller's Obligation when Selling Rights of Others
If the subject matter of the sale is the rights of others, the seller shall assume an
obligation to acquire the rights and transfer
the same to the buyer.
Article 561 Seller's Warranty when Selling Rights of Others
In the cases set forth in the preceding Article,
if the seller cannot acquire and
transfer to the buyer the rights the seller has sold, the buyer may cancel the
contract. In such
cases, if the buyer knew, at the time of the contract, that the rights
did not belong to the seller, the buyer may not demand compensation
for damages.
Article 562 Innocent Seller's Right of Cancellation in a Sale of Others' Rights
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1 In cases where the seller, at the moment of the contract, does not know that the
rights the seller has
sold do not belong to him/her, if the seller cannot acquire the
rights and transfer the same to the buyer, the seller may cancel
the contract by
compensating any damages.
2 In the cases set forth in the preceding paragraph, if the buyer, at the moment of
the contract, knows that the rights the buyer has bought do not belong to the
seller, the seller may cancel the contract by simply
notifying the buyer to the effect
that the seller cannot transfer the rights sold.
Article 563 Seller's Warranty where Rights
Partially Belonged to Others
1 If the seller cannot transfer any part of the rights which are the subject matter
of the sale
because the part of the rights belongs to others, the seller may demand
a reduction of the purchase money in proportion to the
value of the part in
shortage.
2 In the cases set forth in the preceding paragraph, a buyer in good faith may
cancel the contract if the buyer would not have
bought the rights if the rights
consisted only of the remaining portion.
3 A demand for the reduction in the purchase money
or cancellation of the
contract shall not preclude a buyer in good faith from making a claim for damages.
Article 564
The rights
under the preceding Article must be exercised within one year from the
time when the buyer knew the facts if the buyer was in good
faith, or within one year
from the time of the contract if the buyer had knowledge, as the case may be.
Article 565 Seller's
Warranty in Cases of Shortage in Quantity or Partial Loss of
Object
The provisions of the preceding two Articles shall apply mutatis
mutandis in cases
where there is any shortage in the object of a sale made for a designated quantity, or
in cases where part of the
object was already lost at the time of the contract, if the
buyer did not know of the shortage or loss.
Article 566 Seller's Warranty
in cases of Superficies or Other Rights
1 In cases where the subject matter of the sale is encumbered with for the purpose
of
a superficies, an emphyteusis, an easement, a right of retention or a pledge, if
the buyer does not know the same and cannot achieve
the purpose of the contract
on account thereof, the buyer may cancel the contract. In such cases, if the contract
cannot be cancelled,
the buyer may only demand compensation for damages.
2 The provisions of the preceding paragraph shall apply mutatis mutandis in
cases
where an easement that was referred to as being in existence for the benefit of
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immovable property that is the subject matter of a sale, does not exist, and in cases
where a leasehold is registered
with respect to the immovable property.
3 In the cases set forth in the preceding two paragraphs, the cancellation of the
contract
or claim for damages must be made within one year from the time when
the buyer comes to know the facts.
Article 567 Seller's
Warranty in cases of Mortgage or Other Rights
1 If the buyer loses his/her ownership of immovable property that is the object
of a
sale because of the exercise of an existing statutory lien or mortgage, the buyer
may cancel the contract.
2 If the buyer
preserves his/her ownership by incurring expenditure for costs,
he/she may claim reimbursement of those costs from the seller.
3 In the cases set forth in the preceding two paragraphs, the buyer may claim
compensation if he/she suffered loss.
Article
568 Warranty in cases of Compulsory Auctions
1 The successful bidder at compulsory auction may cancel the contract or demand
a reduction from the purchase money against the obligor in accordance with the
provisions from Article 561 through to the preceding
Article.
2 In the cases set forth in the preceding paragraph, if the obligor is insolvent, the
successful bidder may demand
total or partial reimbursement of the proceeds
against the obligees who received the distribution of the proceeds.
3 In the
cases set forth in the preceding two paragraphs, if obligors knew of the
absence of the object or right and did not disclose the
same, or if obligors knew of
the absence but demanded an auction, the successful bidder may demand
compensation for damages against
those persons.
Article 569 Seller's Warranty for Claims
1 If the seller of a claim warrants the solvency of the obligor, it
shall be presumed
that the seller warranted the solvency as at the time of the contract.
2 If the seller of a claim which is
not due yet warrants the future solvency of the
obligor, it shall be presumed that he/she warranted the solvency as at the due
date.
Article 570 Seller's Warranty against Defects
If there is any latent defect in the subject matter of a sale, the provisions
of Article
566 shall apply mutatis mutandis; provided, however, that this shall not apply in
cases of compulsory auction.
Article 571 Seller's Warranty and Simultaneous
Performance
The provisions of Article 533 shall apply mutatis mutandis to the cases set forth
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from Article 563 through to Article 566 and in the preceding Article.
Article 572 Special Agreement Disclaiming
Warranty
Even if the seller makes a special agreement to the effect that the seller will not
provide the warranties set forth from
Article 560 through to the preceding Article,
the seller may not be released from that responsibility with respect to any fact that
the seller knew but did not disclose, and with respect to any right that the seller
himself/herself created for or assigned to a
third party.
Article 573 Due Date for Payment of Purchase money
If there is a due date for the delivery of the subject matter
of the sale, it shall be
presumed that the same due date was also agreed for the payment of the purchase
money.
Article 574 Place
of Payment of Purchase money
If the purchase money is to be paid simultaneously with delivery of the subject
matter of the sale,
the payment must be made at the place of delivery.
Article 575 Ownership in Fruit and Payment of Interest on Purchase money
1
If any subject matter of a sale that is not delivered yet bears any fruit, the fruit
shall vest in the seller.
2 The buyer
shall assume an obligation to pay the interest on the purchase money
from the day of delivery; provided, however, that, if a due
date is provided for the
payment of the purchase money, it shall not be necessary to pay the interest until
that due date arrives.
Article 576 Refusal by Buyer to Pay Purchase money where Loss of Rights is
Likely
If the buyer is likely to lose the rights
he/she has bought, in whole or in part, due
to the existence of persons who assert rights to the subject matter of the sale, the
buyer may refuse to pay the purchase money, in whole or in part, in proportion to the
extent of that likelihood; provided, however,
that this shall not apply if the seller has
provided reasonable security.
Article 577 Refusal by Buyer to Pay Purchase money
in cases of Registered
Mortgage
1 If any mortgage is registered on immovable property that has been purchased,
the buyer may
refuse to pay the purchase money until the completion of the
procedures of the claim for extinguishment of the mortgage.
In such cases, the
seller may demand that the buyer file the claim for extinguishment of the
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mortgage without delay.
2 The provisions of the preceding paragraph shall apply mutatis mutandis to cases
where a statutory lien or pledge is registered on the immovable property that has
been bought.
Article 578 Seller's Demand
for Deposit of Purchase money
In the cases of the preceding two paragraphs, the seller may demand that the
buyer deposit the purchase
money.
Subsection 3 Redemption
Article 579 Special Agreement on Redemption
The buyer of immovable property may cancel
the sale by refunding the purchase
money and costs of the contract paid by the buyer in accordance with a special
agreement on redemption
executed simultaneously with the contract for sale. In
such cases, unless a contrary intention is manifested by the parties,
it shall be
deemed that the fruit of the immovable property and the interest on the purchase
money have been set off against each
other.
Article 580 Period for Redemption
1 The period for the redemption may not exceed ten years. If any special
agreement provides for any period longer than the above, the period shall be ten
years.
2 If a period for the redemption is
agreed, no further extension may be effected
subsequently.
3 If no period for the redemption is agreed, the redemption must
be effected within
five years.
Article 581 Perfection of Special Agreement on Redemption
1 If the special agreement on redemption is registered simultaneously with the
contract
for sale, the redemption shall also be effective against third parties.
2 The rights of a lessee who effected registration can
be asserted against the seller
while the lease remains effective, limited to a period not exceeding one year;
provided, however,
that this shall not apply if the lease is entered into with the
purpose of harming the seller.
Article 582 Exercise of Right
of Redemption by way of Subrogation
If an obligee of the seller intends to effect redemption on behalf of the seller in
accordance
with the provisions of Article 423, the buyer may extinguish the right of
redemption by paying the debts of the seller, to the extent
of the balance obtained by
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deducting the amount the seller is to pay from the
current value of the immovable
property as evaluated by a court-appointed appraiser, and, if any positive balance
remains, by refunding
the same to the seller.
Article 583 Implementation of Redemption
1 A seller may not effect redemption unless the seller provides
the purchase money
and the costs of the contract within the period provided for in Article 580.
2 If a buyer or subsequent acquirer
incurs expenses with respect to immovable
property, the seller must reimburse those expenses in accordance with the
provisions
of Article 196; provided, however, that, with respect to useful expenses,
the court may, at the seller's request, grant a reasonable
period for the
reimbursement.
Article 584 Sale of Co-ownership Interest with Special Agreements on Redemption
If one of the
co-owners of immovable property sells his/her equity interest with
special agreements on its redemption and the immovable property
is then divided or
subjected to auction, the seller may redeem the portion or purchase money that the
buyer receives or is to receive;
provided, however, that any division or auction
effected without notice to the seller may not be asserted against the seller.
Article
585
1 In the cases of the preceding Article, if the buyer is the successful bidder at the
auction of the immovable property,
the seller may effect the redemption by paying
the auction price and the costs provided for in Article 583. In such cases,
the
seller shall acquire full ownership of the immovable property.
2 If the buyer has become the successful bidder at an auction
as the result of the
request of division by other joint owner s , the seller may not effect the
redemption with respect only
to his/her own share.
Section 4 Exchange
Article 586
1 An exchange shall become effective by the mutual promises
by the parties to
transfer any property right other than the ownership of money.
2 In cases where one of the parties promises
to transfer the ownership of money
together with other rights, the provisions regarding purchase money for sale
contracts shall
apply mutatis mutandis to that money.
Section 5 Loans for Consumption
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Article 587 Loans for Consumption
A loan for consumption shall become effective when one of the parties receives
money or other
things from the other party by promising that he/she will return by
means of things that are the same in kind, quality and quantity.
Article 588 Quasi-loans for Consumption
In cases where any person has an obligation to provide money or other things
under any
arrangement which is not a loan for consumption, if the parties agree to
regard such things as the subject matter of a loan for consumption,
it shall be
deemed that this establishes a loan for consumption.
Article 589 Pre-contract of Loans for Consumption and Commencement
of
Bankruptcy Procedures
The pre-contract of a loan for consumption shall lose its effect if a ruling for the
commencement of bankruptcy
procedures is subsequently made against one of the
parties.
Article 590 Lender's Warranty
1 If there is any latent defect in any borrowed
Thing in a loan for consumption
with interest, the lender must replace it with another Thing without defect. In
such cases,
claims for damages shall not be precluded.
2 In a loan for consumption without interest, the borrower may return the value of
a borrowed Thing that is defective. In such cases, the provisions of the preceding
paragraph shall apply mutatis mutandis if
the lender knew of the defect but did
not disclose the same to the borrower.
Article 591 Timing of Returns
1 If the parties
do not define the time for return of borrowed Things, the lender
may demand their return, specifying a reasonable period.
2
The borrower may return borrowed Things at any time.
Article 592 Reimbursement of Value
If the borrower has become unable to
return Things in the same kind, quality and
quantity as that of the Things the borrower received from the lender, the borrower
must
return the current value of the Things; provided, however, that this shall not
apply in the cases provided for in Paragraph 2 of
Article 402.
Section 6 Loans for Use
Article 593 Loans for Use
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-
A loan for use shall become effective when one of the parties receives a defined
Thing from the other party by promising that
he/she will return the Thing after
he/she has gratuitously made use of and taken the profits of the same .
Article 594 Borrower's
Use and Profit
1 A borrower must make use of and take the profits of the Thing in compliance
with the method of use specified
by the contract or by the nature of the Thing
which is the subject matter of the contract.
2 A borrower may not allow third
parties to make use of or take the profits of the
Thing without obtaining the approval of the lender.
3 If a borrower has made
use of or taken the profits of the Thing in violation of the
preceding two paragraphs, the lender may cancel the contract.
Article
595 Responsibility for Costs of Borrowed Things
1 The borrower shall bear the ordinarily necessary costs of borrowed Things.
2 The provisions of Paragraph 2 of Article 583 shall apply mutatis mutandis to
costs other than the ordinarily necessary costs
under the preceding paragraph.
Article 596 Lender's Warranty
The provisions of Article 551 shall apply mutatis mutandis to loans
for use.
Article 597 Timing of Returns of Borrowed Things
1 A borrower must return borrowed Things at the time specified in
the contract.
2 When the parties have not specified a time for return, the borrower must return
the borrowed Things when he/she
has completed to make use of or take the profits
of the same in compliance with the purposes provided for in the contract; provided,
however, that the lender may demand the immediate return of the borrowed
Things even before the completion of using or taking
profits if a period sufficient
for using or taking profits has elapsed.
3 If the parties have not specified the timing of the
return and the purposes of the
using and taking profits, the lender may demand the return of the borrowed
Things at any time.
Article 598 Removal by Borrower
A borrower may restore a borrowed Thing to its original condition and remove
anything attached
to the same.
Article 599 Termination of Loan for Use upon Death of Borrower
Loans for use shall lose its effect on the death
of the borrower.
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Article 600 Restriction on Period of Rights to Demand Compensation
for Damages
and Reimbursement of Costs
Claims for compensation for damages resulting from using or taking profits of the
Thing
inconsistent with the main purport of the contract, and for the reimbursement
of costs incurred by the borrower, must be submitted
within one year from the time
when the lender receives the return of the borrowed Things.
Section 7 Leases
Subsection 1 General Provisions
Article 601 Leases
A
lease shall become effective when one of the parties promises to make a certain
Thing available for the using and taking the profits
by the other party and the other
party promises to pay rent for the same.
Article 602 Short-term Leases
In cases where a person
with limited capacity to act or a person with no authority
with respect to the act of disposition makes a lease contract, the leases
listed in the
following items shall not exceed the terms prescribed respectively in those items:
i Leases of forest for
the purpose of planting or felling trees: 10 years;
ii Leases of land other than the leases listed in the preceding item:
5 years;
iii Lease of a building: 3 years; and
iv Lease of a movable : 6 months.
Article 603 Renewal of Short-term
Leases
The terms prescribed in the preceding Article may be renewed; provided, however,
that the renewal must be carried out within
one year prior to the expiration of the
term for land, and within 3 months prior to the expiration of the term for a building,
and
within 1 month prior to the expiration of the term for a movable.
Article 604 Duration of Lease
1 The duration of a lease
may not exceed twenty years. Even if the contract
prescribes a longer term, the term shall be 20 years.
2 The
duration of a lease may be renewed; provided, however, that such period
may not exceed twenty years from the time of the renewal.
Subsection 2 Effect of Lease
Article 605 Perfection of Leasehold
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A lease of immovable property, when registered, shall also be effective against a
person who subsequently acquires
real rights with respect to the immovable property.
Article 606 Repairs of Leased Things
1 A lessor shall assume an obligation
to effect repairs necessary for using and
taking the profits of the leased Things.
2 The lessee may not refuse if the lessor
intends to engage in any act that is
necessary for the preservation of the leased Thing.
Article 607 Act to Preserve against
the Will of the Lessee
In cases where the lessor intends to engage in an act to preserve the leased Thing
against the will of the
lessee, if the lessee cannot achieve the purpose of the lease as
a result of the same, the lessee may cancel the contract.
Article
608 Lessee's Demand for Reimbursement of Costs
1 If a lessee has defrayed necessary expenses with respect to the leased Thing
which ought to be borne by the lessor, the lessee may immediately demand the
reimbursement of the same from the lessor.
2
If the lessee has incurred useful expenses with respect to the leased Thing, the
lessor must reimburse those expenses on termination
of the lease in compliance
with the provisions of Paragraph 2 of Article 196; provided, however, that the court
may, at the lessor's
request, grant a reasonable period for the reimbursement of
the same.
Article 609 Demand for Reduction of Rent due to Decrease
in Profits
A lessee of land for the purpose of profit making may, if he/she obtains profits less
than the rent due to force majeure,
demand that the amount of the rent be reduced
to the level of the amount of the profits; provided, however, that this shall not apply
with respect to leases of residential land.
Article 610 Termination due to Decrease in Profits
In the cases of the preceding
Article, the lessee referred to in that Article may
cancel the contract if he/she has made profits less than the rent for at least
two
consecutive years due to force majeure.
Article 611 Demands for Reduction of Rent due to Partial Loss of Leased Thing
1
If any part of a leased thing is lost due to reasons not attributable to the
negligence of the lessee, the lessee may demand a
reduction of the rent in
proportion to the value of the lost part.
2 In the cases set forth in the preceding paragraph, if the lessee cannot achieve
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the purpose of the lease with the remaining portion only, the lessee may cancel the
contract.
Article
612 Restrictions on Assignment and Subleasing of Leasehold
1 A lessee may not assign the lessee's rights or sublease a leased
Thing without
obtaining the approval of the lessor.
2 If the lessee allows any third party to make use of or take the profits
of a leased
Thing in violation of the provisions of the preceding paragraph, the lessor may
cancel the contract.
Article 613
Effect of Subleases
1 If a lessee lawfully subleases a leased Thing, the sublessee shall assume a direct
obligation to the
lessor. In such cases, advance payment of rent may not be
asserted against the lessor.
2 The provisions of the preceding
paragraph shall not preclude the lessor from
exercising his/her rights against the lessee.
Article 614 Timing of Payment of Rent
Rent must be paid at the end of the month with respect to movables, buildings and
land for residential purpose, and at the end
of the year with respect to other land;
provided, however, that, with respect to anything with a harvest season, the rent
must be
paid without delay after that season.
Article 615 Obligation of Lessee to Give Notice
If the leased Thing requires any repair,
or if any person asserts rights with respect
to the leased Thing, the lessee must notify the lessor without delay; provided,
however,
that this shall not apply if this is already known to the lessor.
Article 616 Mutatis Mutandis Application of Loans for Use
The
provisions of Paragraph 1 of Article 594, Paragraph 1 of Article 597 and
Article 598 shall apply mutatis mutandis to leases.
Subsection 3 Termination of Leases
Article 617 Offers to Terminate Leases with Indefinite Terms
1 If the parties
do not specify the term of a lease, either party may request to
terminate it at any time. In such cases, the leases listed
in the following items
shall terminate on the expiration of the respective periods from the day of the
request to terminate prescribed
respectively in those items:
i Leases of land: one year;
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ii
Leases of buildings: three months; and
iii Leases of movables and seating hire facilities: one day.
2 With respect
to leases of land with harvest seasons, the request to terminate
must be made after the end of that season and before the next
start of cultivation.
Article 618 Reservation of Rights to Terminate Leases with Definite Terms
Even if the parties specify the
term of a lease, the provisions of the preceding
Article shall apply mutatis mutandis if one party reserves, or both parties reserve,
the right to terminate during that period.
Article 619 Presumption of Renewal of Leases
1 In cases where a lessee continues
to make use or take the profits of the Thing
after the expiration of the term of the lease, if a lessor who knows of the same
raises no objection, it shall be presumed that a further lease is entered into under
conditions identical to those of the previous
lease. In such cases, each party may
request to terminate in accordance with the provisions of Article 617.
2 If one of the
parties has provided security for the previous lease, the security
shall be extinguished upon expiration of the term; provided,
however, that this
shall not apply to a security deposit.
Article 620 Effect of Cancellations of Leases
In cases where a lease
is cancelled, the cancellation shall be effective solely toward
the future. In such cases, if one of the parties is negligent,
claims for damages
against that party shall not be precluded.
Article 621 Limitation on Periods of Rights to Demand Compensation
for Damages
and Reimbursement of Costs
The provisions of Article 600 shall apply mutatis mutandis to leases.
Article 622
deleted
Section 8 Employment
Article 623 Employment
An employment contract shall become effective when one of the parties promises to
the other party that
he/she will engage in work and the other party promises to pay
remuneration for the same.
Article 624 Timing of Payment of Remuneration
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1 An employee may not demand remuneration until the work he/she promised
to
perform has been completed.
2 Remuneration specified with reference to a period may be claimed on the
expiration of that
period.
Article 625 Restrictions on Assignment of Employer's Rights
1 An employer may not assign his/her rights to third parties
unless the employer
obtains the employee's consent.
2 An employee may not cause any third party to work on his/her behalf unless
the
employee obtains the employer's consent.
3 If an employee causes any third party to work in violation of the provisions
of
the preceding paragraph, the employer may cancel the contract.
Article 626 Cancellation of Employment with Indefinite Term
1 If the term of employment exceeds five years, or employment is to continue
during the life of either party or any third party,
either party may cancel the
contract at any time after the expiration of five years; provided, however, that said
five years
shall be ten years with respect to employment for the purpose of
apprenticeship in commerce and industry.
2 If a person intends
to cancel a contract under the provisions of the preceding
paragraph, he/she must give notice three months in advance.
Article
627 Offer to Terminate Employment with Indefinite Term
1 If the parties have not specified the term of employment, either party
may
request to terminate at any time. In such cases, employment shall terminate on
the expiration of two weeks from the day of
the request to terminate.
2 If remuneration is specified with reference to a period, the request to terminate
may be made with
respect to the following period of time onward; provided,
however, that the request to terminate must be made in the first half
of the
current period.
3 If remuneration is specified with reference to a period of six months or more, the
request to terminate
under the preceding paragraph must be made three months
before the termination.
Article 628 Cancellation of Employment due to
Unavoidable Reasons
Even in cases where the parties have specified the term of employment, if there
are unavoidable reasons, either
party may immediately cancel the contract. In such
cases, if the reasons arise from the negligence of either one of the parties,
that party
shall be liable to the other party for damages.
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Article 629 Presumption
of Renewal of Employment
1 In cases where an employee continues to engage in his/her work after the
expiration of a term of
employment, if an employer knows of the same and raises
no objection, it shall be presumed that the further employment is entered
into
under conditions identical to those of the previous employment. In such cases,
each party may request to termination
under the provisions of Article 627.
2 If either party has provided security for the previous employment, the security
shall
be extinguished on the expiration of the term; provided, however, that this
shall not apply to fidelity bonds.
Article 630 Effect
of Cancellation of Employment
The provisions of Article 620 shall apply mutatis mutandis to employment.
Article 631 Request to
Terminate due to Commencement of Bankruptcy Procedures
for Employer
In cases where the employer is subject to a ruling for the
commencement of
bankruptcy procedures, the employee or the trustee in bankruptcy may request to
terminate under the provisions of
Article 627 even if the employment is for a definite
term. In such cases, neither party may claim compensation from the other party for
damages suffered as a result of the termination.
Section 9 Contracts for Work
Article 632 Contracts for Work
A contract for work shall become effective when one of
the parties promises to
complete work and the other party promises to pay remuneration for the outcome of
the work.
Article 633
Timing of Payment of Remuneration
Remuneration must be paid simultaneously with delivery of the subject matter of
work performed;
provided, however, that, if no delivery of a Thing is required, the
provisions of Article 624 1 shall apply mutatis mutandis.
Article 634 Contractor's Warranty
1 If there is any defect in the subject matter of work performed, the party ordering
the
work may demand that the contractor repair the defect, specifying a reasonable
period; provided, however, that this shall not apply
if the defect is not significant
and excessive costs would be required for the repair.
2 The party ordering the work may demand
compensation for damages in lieu of,
or in addition to, the repair of the defect. In such cases, the provisions of Article
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533 shall apply mutatis mutandis.
Article 635
If there is any defect in the
subject matter of work performed and the purpose of
the contract cannot be achieved because of the defect, the party ordering the
work
may cancel the contract; provided, however, that this shall not apply to a building or
other structure on land.
Article 636
No Application of Provisions on Contractor's Warranty
The provisions of the preceding two Articles shall not apply if the defect
in the
subject matter of the work arises due to the nature of the materials supplied by, or
instructions given by, the party ordering
the work; provided, however, that this shall
not apply if the contractor knew that the materials or instructions were
inappropriate
but did not disclose the same.
Article 637 Duration of Contractor's Warranty
1 The demand for repair or claim for damages and
cancellation of the contract
under the preceding three Articles must be made within one year from the time of
the delivery of
the subject matter of the work.
2 Where no delivery of the subject matter is required, the period referred to in the
preceding
paragraph commences to run from the time of the completion of the
work.
Article 638
1 A contractor for a building or other
structure on land shall be liable for a
warranty against defects in the structure or ground for the period of five years
from
delivery; provided, however, that the period shall be ten years for structures
made of stone, earth, bricks, concrete, steel and
other similar structures.
2 If any structure is lost or damaged due to the defects set forth in the preceding
paragraph, the
party ordering the work must exercise the rights under the
provisions of Article 634 within one year from the time of the loss
or damage.
Article 639 Extension of Duration of Warranty
The periods set forth in Article 637 and Paragraph 1 of the preceding
Article may
be extended by contract so long as they do not exceed the period of time provided for
the extinctive prescription under
the provisions of Article 167.
Article 640 Special Agreement of No Warranty
Even if the contractor agrees to a special agreement
to the effect that the
contractor will not be liable for the warranty provided in Article 634 or Article 635,
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the contractor may not be released from the contractor's liability with respect to facts
the contractor
knew and did not disclose.
Article 641 Cancellation of Contract by Party Ordering Work
The party ordering work may cancel the
contract at any time whilst the contractor
has not completed the work by compensating any damages.
Article 642 Cancellation on
Commencement of Bankruptcy Procedures for Party
Ordering Work
1 In cases where the party ordering work is subject to a ruling for the
commencement of bankruptcy procedures, the contractor
or the trustee in
bankruptcy may cancel the contract. In such cases, the contractor may participate
in the distribution of the
bankrupt estate with respect to remuneration for the
work already performed and any costs not included in that remuneration.
2
In the cases set forth in the preceding paragraph, claims for damages suffered as
a result of the cancellation of the contract
shall be permitted only for contractors
under contracts cancelled by the trustee in bankruptcy. In such cases, the
contractors
shall participate in the distribution of the bankrupt estate with respect
to such damages.
Section 10 Mandates
Article
643 Mandates
A mandate shall become effective when one of the parties mandates the other
party to perform a juristic act, and the
other party accepts the mandate.
Article 644 Duty of Care of Mandatary
A mandatary shall assume a duty to administer the mandated
business with the
care of a good manager compliance with the main purport of the mandate.
Article 645 Reports by Mandatary
A
mandatary must, if so requested by the mandator, report the current status of
the administration of the mandated business at any
time, and must report the
process and results without delay upon completion of the mandate.
Article 646 Delivery of Received Things
by Mandatary
1 The mandatary must deliver to the mandator monies and other Things that
he/she has received during the course
of administering the mandated business.
The same shall apply to fruits the mandatary has reaped.
2 The mandatary must transfer
to the mandator rights the mandatary has
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acquired in his/her own name on behalf
of the mandator.
Article 647 Mandatary's Responsibility for Consumption of Monies
If the mandatary has consumed monies for his/her
personal benefit that the
mandatary is to deliver to the mandator, or any monies that are to be used for the
benefit of the mandator,
the mandatary must pay interest for the period from the day
of that consumption. In such cases, if any damages still remain, the
mandatary
shall be liable to compensate for the same.
Article 648 Remuneration for Mandatary
1 In the absence of any special
agreements, the mandatary may not claim
remuneration from the mandator.
2 In cases where the mandatary is to receive remuneration,
the mandatary may
not claim the same until and unless he/she has performed the mandated business;
provided, however, that if
the remuneration is specified with reference to period,
the provisions of Paragraph 2 of Article 624 shall apply mutatis mutandis.
3 If the mandate terminates during performance due to reasons not attributable to
the mandatary, the mandatary may demand remuneration
in proportion to the
performance already completed.
Article 649 Mandatary's Claims for Advance for Costs
If costs will be incurred
in administering the mandated business, the mandator
must, at the request of the mandatary, pay an advance for those costs.
Article
650 Mandatary's Claims for Reimbursement of Expense
1 If the mandatary has incurred costs found to be necessary for the administration
of the mandated business, the mandatary may claim reimbursement of those costs
from the mandator and any interest on the same
from the day the costs were
incurred.
2 If the mandatary has incurred any obligation found to be necessary for the
administration
of the mandated business, the mandatary may demand that the
mandator perform the obligation on the mandatary's behalf. In such
cases, if the
obligation has not yet fallen due, the mandatary may require the mandator to
tender reasonable security.
3 If
the mandatary suffers any loss due to the administration of the mandated
business without negligence in the mandatary, he/she may
claim compensation for
the loss from the mandator.
Article 651 Cancellation of Mandate
1 A mandate may be cancelled by either party
at any time.
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2 If one of the parties cancels a mandate at a time that
is detrimental to the other
party, the former party must compensate the damages suffered by the other party;
provided, however,
that this shall not apply if there are unavoidable grounds.
Article 652 Effect of Cancellation of Mandate
The provision of Article
620 shall apply mutatis mutandis to mandates.
Article 653 Grounds for Termination of Mandate
A mandate shall terminate when:
i The mandator or mandatary dies;
ii The mandator or mandatary is subject to a ruling for the commencement of
bankruptcy procedures;
iii The mandatary is subject to an order for the commencement of guardianship.
Article 654
Disposition after Termination of Mandate
In cases where a mandate has terminated, if there are pressing circumstances, the
mandatary
or his/her heir or legal representative must effect necessary dispositions
until the time when the mandator or his/her heir or legal
representatives is able to
take charge of the mandated business.
Article 655 Requirement for Perfection of Termination of Mandate
The grounds of termination of mandate may not be asserted against the other
party unless the other party was notified of or knew
of the same.
Article 656 Quasi-Mandate
The provisions of this Section shall apply mutatis mutandis to mandates of
business that
do not constitute juristic acts.
Section 11 Deposits
Article 657 Deposits
A deposit shall become effective when
one of the parties receives a certain Thing by
promising that he/she will retain it for the other party.
Article 658 Use of Deposited
Thing and Retention by Third Parties
1 A depositary may not use, or allow third parties to retain, the Thing deposited
without
obtaining the consent of the depositor.
2 The provisions of Article 105 and paragraph 2 of Article 107 shall apply mutatis
mutandis to cases where a depositary may allow third parties to retain deposited
Things.
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Article 659 Duty of Care of Gratuitous Depositary
A person who has undertaken a deposit gratuitously shall
assume a duty to retain
the Thing deposited exercising care identical to that he/she exercises for his/her own
property.
Article
660 Obligation of Depositary to Give Notice
If a third party asserting rights with respect to the Thing deposited has brought a
lawsuit against the depositary, or has effected an attachment, provisional
attachment, or provisional disposition, the depositary
must notify the depositor of
that fact without delay.
Article 661 Compensation of Damages by Depositor
The depositor must compensate
the depositary for damages that occur due to the
nature of or defects in the Thing deposited; provided, however, that this shall
not
apply if the depositor did not, without negligence, know of such nature or defect, or
the depositary knew of the same.
Article
662 Depositor's Demand for Return
Even if the parties specify the time for the return of the Thing deposited, the
depositor may
demand the return of the same at any time.
Article 663 Timing of Return of the Thing Deposited
1 If the parties have not specified
the timing of the return of the Thing deposited,
the depositary may return the same at any time.
2 If the timing of the return
is specified, the depositary may not return the
deposited goods prior to the due date unless there are unavoidable grounds.
Article
664 Place of Return of the Thing Deposited
The place for the return of the Thing deposited must be at the place where they
are
to be retained; provided, however, that, if the depositary has changed the place of
retention on reasonable grounds, the return may
be made at that current place of
retention.
Article 665 Mutatis Mutandis Application of Provisions on Mandate
The provisions of Article 646 to Article 650 excluding
Paragraph 3 of this Article
shall apply mutatis mutandis to deposits.
Article 666 Deposits for Consumption
1 The provisions
of Section 5 Loans for Consumption shall apply mutatis
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mutandis
to cases where a depositary may, under the contract, consume the Thing
deposited.
2 Notwithstanding the provisions of Paragraph
1 of Article 591 which shall apply
mutatis mutandis under the preceding paragraph, if the contract referred to in the
preceding
paragraph does not specify the timing of the return, the depositor may
demand the return at any time.
Section 12 Partnerships
Article 667 Partnership Contracts
1 A partnership contract shall become effective when each of the parties promises
to engage
in joint business by making a contribution.
2 The subject of the contribution may be services .
Article 668 Joint Ownership
in Partnership Property
The contributions of the partners and other partnership property shall be jointly
owned by all partners.
Article 669 Responsibility for Failure to Provide Monetary Contribution
In cases where monies are the subject of the contribution,
if any partner fails to
contribute his/her share of the contribution, he/she must pay interest on the same
and otherwise compensate
for damages.
Article 670 Method of Business Management
1 The management of partnership business shall be determined by the majority
of
the partners.
2 If more than one person is delegated to manage the business referred to in the
preceding paragraph under
the partnership contract referred to in the following
paragraph as "Operating Officers" , the same shall be determined by
majority.
3 Notwithstanding the provisions of the preceding two paragraphs, the ordinary
business of a partnership may be performed
by each partner or each Operating
Officer individually; provided, however, that this shall not apply if other partners
or Operating
Officers raise objections prior to the completion of the business.
Article 671 Mutatis Mutandis Application of Provisions on Mandates
The provisions of Article 646 to Article 650 shall apply mutatis mutandis to
partners who manage the business of a partnership.
Article 672 Resignations and Dismissals of Operating Partners
1 If one or more partners are delegated to manage partnership
business under the
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partnership contract, those partners may not resign without
reasonable grounds.
2 The partners referred to in the preceding paragraph may be dismissed by the
unanimous agreement of the
other partners, limited to cases where there are
justifiable grounds.
Article 673 Inspections by Partners of Condition of
Partnership Business and
Property
Each partner may inspect the condition of the business and property of the
partnership even if
he/she does not have the right to manage the business of the
partnership.
Article 674 Proportions of Partners' Distributions of
Profits and Losses
1 If partners have not specified the proportions of the distributions of the
partnership's profits and losses,
the proportions shall be determined in proportion
to the value of each partner's contribution.
2 If the proportions of the distributions
are specified solely with respect to either
profits or losses, it shall be presumed that the proportions are common to profits
and losses.
Article 675 Exercise of Right of Creditors of the Partnership against Partners
If a creditor of a partnership did
not, when his/her claim arose, the proportions of
the partners' shares of losses, the creditor may exercise his/her rights against
each
partner in equal proportions.
Article 676 Disposal Partners' Shares and Division of Partnership Property
1 If a partner
disposes of his/her share with respect to the partnership property,
the disposal may not be asserted against the partnership and third parties who
had
dealings with the partnership.
2 A partner may not seek the division of the partnership property before the same
is liquidated.
Article 677 No Set-off by Obligor of Partnership
An obligor of a partnership may not set off his/her obligation against his/her
claim
against the partners.
Article 678 Withdrawal of Partners
1 If a partnership contract does not specify the duration of
the partnership, or
specifies that the partnership is to continue for the life of a certain partner, each
partner may withdraw
at any time; provided, however, that, unless there are
unavoidable grounds, a partner may not withdraw at a time that is detrimental
to
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the partnership.
2 Even in cases where the duration of the partnership
is specified, each partner
may withdraw if there are unavoidable grounds.
Article 679
In addition to the cases referred to
in the preceding Article, partners shall
withdraw on the following grounds:
i The partner dies;
ii The partner is
subject to a ruling for the commencement of bankruptcy
procedures;
iii The partner is subject to an order for the
commencement of guardianship;
iv The partner has been expelled.
Article 680 Expulsion of Partners
The expulsion of a
partner may be effected by the unanimous agreement of the
other partners, limited to cases where there are justifiable grounds; provided,
however, that the expulsion may not be asserted against a partner who is expelled
unless a notice to that effect is given to that
partner.
Article 681 Refunds of Shares of Withdrawing Partners
1 Accounts as between the withdrawing partner and other partners
must be
settled according to the condition of the partnership property as at the time of the
withdrawal.
2 The share of
the withdrawing partner may be refunded in money, regardless of
the kind of his/her contribution.
3 With respect to any
matter not yet completed at the time of the withdrawal,
accounts may be made up subsequent to the completion of that matter.
Article 682 Causes of Dissolution of Partnerships
A partnership shall be dissolved on the successful completion of the business
that
is its object, or by the impossibility of such successful completion.
Article 683 Request for Dissolution of Partnerships
Each partner may request the dissolution of the partnership if there are
unavoidable grounds.
Article 684 Effect of Cancellation
of Partnership Contracts
The provisions of Article 620 shall apply mutatis mutandis to partnership
contracts.
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Article 685 Liquidation of Partnerships and Appointment of Liquidators
1 When a partnership
is dissolved, the liquidation shall be administered jointly by
all partners or by a liquidator appointed by the same.
2
A liquidator shall be appointed by a majority of all partners.
Article 686 Method of Management of Liquidators' Business
The
provisions of Article 670 shall apply mutatis mutandis to cases where there is
more than one liquidator.
Article 687 Resignations
and Dismissals of Liquidators who are Partners
The provisions of Article 672 shall apply mutatis mutandis to cases where the
liquidator
is appointed from among the partners under the partnership contract.
Article 688 Duties and Authority of Liquidators and Method
of Division of Residual
Assets
1 A liquidator shall have the duties to:
i conclude the current business
ii
collect debts and perform obligations; and
iii deliver the residual assets.
2 The liquidator may perform any and
all acts in order to perform its duties listed
in the respective items of the preceding paragraph.
3 Residual assets shall
be distributed in proportion to the value of the
contributions of each partner.
Section 13 Life Annuities
Article 689 Life Annuities
Life annuities shall
become effective when one of the parties promises to deliver
monies or other Things to the other party or a third party periodically
until the death
of the first party, the other party or the third party.
Article 690 Accounting for Life Annuities
Life annuities
shall be calculated on a daily basis.
Article 691 Cancellation of Contracts for Life Annuities
1 In cases where the obligor
in a life annuity has received the principal for the life
annuity, if the obligor fails to pay the life annuity or fails to perform
other
obligations, the other party may demand the return of the principal. In such
cases, the other party must return
the amount of the life annuity he/she has
already received to the obligor of the life annuity, less the amount of the interest
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on that principal.
2 The provisions of the preceding paragraph shall
not preclude claims for damages.
Article 692 Cancellation of Contracts for Life Annuities and Simultaneous
Performance
The
provisions of Article 533 shall apply mutatis mutandis to cases referred to in
the preceding Article.
Article 693 Declaration of
Continuation of Claim for Life Annuity
1 If a death provided for in Article 689 occurs due to grounds attributable to the
obligor
in a life annuity, the court may, at the request of the obligee in the life
annuity or the obligee's heirs, declare that the life
annuity claim shall continue for
a reasonable period.
2 The provisions of the preceding paragraph shall not preclude the exercise
of the
rights provided in Article 691.
Article 694 Testamentary Gifts of Life Annuities
The provisions of this Section shall
apply mutatis mutandis to testamentary gifts
of life annuities.
Section 14 Settlements
Article 695 Settlements
A settlement
shall become effective when the parties to a dispute promise to settle
the dispute through reciprocal concessions.
Article 696
Effect of Settlements
In cases where it is admitted at settlement that one of the parties has the rights
that are the subject of
the dispute, or that the other party did not have the rights, if
conclusive evidence is obtained to the effect that the first party
did not have the
rights in the past, or that the other party did have the rights, the rights are regarded
as either transferred to
the first party or extinguished at settlement.
Chapter 3 Negotiorum Gestio Management of Business
Article 697 Negotiorum
Gestio Management of Business
1 A person who commences the management of a business for another person
without being obligated
to do so hereinafter in this Chapter referred to as
"Manager" must manage that business hereinafter referred to as
"Management
of Business" in accordance with the nature of the business, using the method that
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best conforms to the interests of that another person the principal .
2 The Manager must engage
in Management of Business in accordance with the
intentions of the principal if the Manager knows, or is able to conjecture that
intention.
Article 698 Urgent Management of Business
If a Manager engages in the Management of Business in order to allow a
principal
to escape imminent danger to the principal's person, reputation or property, the
Manager shall not be liable to compensate
for damages resulting from the same
unless he/she has acted in bad faith or with gross negligence.
Article 699 Obligation of Managers
to Give Notice
A Manager must notify the principal that the Manager has commenced the
Management of Business; provided, however,
that this shall not apply if the principal
already knows of the same.
Article 700 Continuation of Management of Business by Managers
A Manager must continue the Management of Business until the principal or
his/her heirs or legal representatives can undertake it; provided, however, that this
shall not apply in cases where it is evident that the continuation of the Management
of Business is contrary to the intentions of
the principal, or is disadvantageous to the
principal.
Article 701 Mutatis Mutandis Application of Provisions on Mandates
The
provisions from Article 645 through to Article 647 shall apply mutatis
mutandis to the Management of Business.
Article 702 Managers'
Claims for Reimbursement of Costs
1 If a Manager has incurred useful expenses for a principal, the Manager may
claim reimbursement
of those costs from the principal.
2 The provisions of Paragraph 2 of Article 650 shall apply mutatis mutandis to
cases where
a Manager has incurred useful obligations on behalf of the principal.
3 If a Manager has engaged in the Management of Business
against the intention
of the principal, the provisions of the preceding two paragraphs shall apply mutatis
mutandis, solely to
the extent the principal is actually enriched.
Chapter 4 Unjust Enrichment
Article 703 Obligation to Return Unjust Enrichment
A person who has benefited hereinafter in this Chapter referred to as
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-
"beneficiary" from the property or labor of others without legal cause and has
thereby caused loss to others shall assume an
obligation to return that benefit, to the
extent the benefit exists.
Article 704 Obligation of Beneficiaries in Bad Faith to Return
A Beneficiary in bad faith must return the benefit received together with interest
thereon. In such cases, if any damages still
remain, the Beneficiary shall be liable to
compensate for the same.
Article 705 Performance knowing of Absence of Obligation
A person who has tendered anything as performance of an obligation may not
demand the return of the thing tendered if the person
knew, at the time, that the
obligation did not exist.
Article 706 Performance before Due Date
If an obligor has tendered anything
as performance of an obligation that has not
yet fallen due, the obligor may not demand the return of the thing tendered;
provided,
however, that, if the obligor tendered anything by mistake, the obligee
must return the benefit gained as a result.
Article 707
Performance of Obligations of Others
1 In cases where a person who is not an obligor has performed an obligation by
mistake,
if the obligee has, in good faith, allowed the instrument to be lost,
damaged the instrument, waived the security or lost the claim
by prescription, the
person who performed the obligation may not demand the return of the
performance.
2 The provisions of
the preceding paragraph shall not preclude the person who
performed an obligation from exercising his/her right of subrogation
against the
obligor.
Article 708 Performance for Illegal Causes
A person who has tendered performance of an obligation for
an illegal cause may
not demand the return of the thing tendered; provided, however, that this shall not
apply if the illegal cause
existed solely in relation to the Beneficiary.
Chapter 5 Torts
Article 709 Damages in Torts
A person who has intentionally
or negligently infringed any right of others, or
legally protected interest of others, shall be liable to compensate any damages
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resulting in consequence.
Article 710 Compensation for Damages Other than
Property
Persons liable for damages under the provisions of the preceding Article must also
compensate for damages other than those
to property, regardless of whether the
body, liberty or reputation of others have been infringed, or property rights of others
have
been infringed.
Article 711 Compensation for Damages to Next of Kin
A person who has taken the life of another must compensate
for damages to the
father, mother, spouse and children of the victim, even in cases where the property
rights of the same have not been infringed.
Article 712 Capacity for Liability
In cases where a minor has inflicted damages on others, if the minor does not have
sufficient intellectual capacity to appreciate
his/her liability for his/her own act, the
minor shall not be liable to compensate for that act.
Article 713
A person who has
inflicted damages on others while he/she lacks the capacity to
appreciate his/her liability for his/her own act due to mental disability
shall not be
liable to compensate for the same; provided, however, that this shall not apply if
he/she has temporarily invited that
condition, intentionally or negligently.
Article 714 Liability of Person Obligated to Supervise a Person without Capacity
1
In cases where a person without capacity to assume liability is not liable in
accordance with the provisions of the preceding two
Articles, the person with the
legal obligation to supervise the person without capacity to assume liability shall
be liable to
compensate for damages that the person without capacity to assume
liability has inflicted on a third party; provided, however,
that this shall not apply
if the person who has the obligation to supervise did not fail to perform his/her
obligation or if
the damages could not have been avoided even if he/she had not
failed to perform his/her obligation.
2 A person who supervises
a person without capacity to assume liability, on behalf
of a person who has the obligation to supervise, shall also assume the
liability
under the preceding paragraph.
Article 715 Liability of Employers
1 A person who employs others for a certain business
shall be liable for damages
inflicted on a third party by his/her employees with respect to the execution of that
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business; provided, however, that this shall not apply if the employer exercised
reasonable
care in appointing the employee or in supervising the business, or if the
damages could not have been avoided even if he/she had
exercised reasonable care.
2 A person who supervises the business on behalf of the employer shall also
assume the liability
under the preceding paragraph.
3 The provisions of the preceding two paragraphs shall not preclude the employer
or supervisor
from exercising their right to obtain reimbursement against the
employee.
Article 716 Liability of Party Ordering Work
A party
ordering work shall not be liable for the damages a contractor inflicted on
a third party with respect to his/her work; provided,
however, that this shall not
apply if the party ordering work is negligent in his/her order or instructions.
Article 717 Liability
of Possessor and Owner of Structure on Land
1 If any defect in the installation or preservation of any structure on land causes
damages to others, the possessor of such structure shall be liable to the victims to
compensate for those damages; provided,
however, that, if the possessor has used
necessary care to prevent the damages arising, the owner must compensate for the
damages.
2 The provisions of the preceding paragraph shall apply mutatis mutandis to cases
where there is any defect in the planting
or support of bamboos and trees.
3 In the cases of the preceding two paragraphs, if there is another person who is
liable for
the cause of the damages, the possessor or owner may exercise their right
to obtain reimbursement against such person.
Article
718 Liability of Possessor of Animal
1 A possessor of an animal shall be liable to compensate for the damages that the
animal
has inflicted on others; provided, however, that this shall not apply if
he/she managed the animal with reasonable care according
to the kind and nature
of the animal.
2 A person who manages the animal on behalf of the possessor shall also assume
the liability
under the preceding paragraph.
Article 719 Liability of Joint Tortfeasors
1 If more than one person has inflicted damages on others by their joint tortious
acts, each of
them shall be jointly and severally liable to compensate for those
damages. The same shall apply if it cannot be ascertained
which of the joint
tortfeasors inflicted the damages.
2 The provisions of the preceding paragraph shall apply to any person
who incited
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or was an accessory to the perpetrator, by deeming him/her to
be one of the joint
tortfeasors.
Article 720 Self-Defense and Aversion of Present Danger
1 A person who, in response to
the tortious act of another, unavoidably commits a
harmful act to protect himself/herself, the rights of a third party, or any
legally
protected interest, shall not be liable for damages; provided, however, that the
victim shall not be precluded from claiming
damages against the person who
committed the tortious act.
2 The provisions of the preceding paragraph shall apply mutatis
mutandis to cases
where a Thing belonging to others is damaged to avoid imminent danger arising
from that Thing.
Article 721
Fetus' Capacity to Hold Rights regarding the Right to Demand
Compensation for Damages
An unborn child shall be deemed to have
been already born with respect to the
right to demand compensation for damages.
Article 722 Method of Damages and Comparative Negligence
1 The provisions of Article 417 shall apply mutatis mutandis to compensation for
damages in tort.
2 If a victim is negligent,
the court may determine the amount of compensation by
taking that factor into consideration.
Article 723 Recovery in Defamation
The court may, at the request of the victim, order a person who defamed others, to
effect appropriate measures to restore the reputation
of the victim in lieu of, or in
addition to, damages.
Article 724 Restriction of Period of Right to Demand Compensation for Damages
in
Tort
The right to demand compensation for damages in tort shall be extinguished by the
operation of prescription if it is not
exercised by the victim or his/her legal
representative within three years from the time when he/she comes to know of the
damages
and the identity of the perpetrator. The same shall apply when twenty
years have elapsed from the time of the tortious act.
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