FEATURES OF FORECLOSURE FOR A SHARE IN COMMON PROPERTY

  The main issue for the practical application of Art. 366 of the Civil Code of Ukraine is a question which should be the algorithm of action and to charge a share in the joint property. It is with such issues that clients turn to AB “Prikhodko & Partners” when there is a need for representation in ICEs, sale of joint property, share of shares, etc.

 First of all, it should be noted that the creditor has the right to levy a share that is in common partial ownership only in the absence or insufficiency of the debtor other property sufficient to satisfy the claims of creditors.

 We simulate the situation when a person has a decision on debt recovery and the state executor has started the procedure for implementing the decision.

 The state executor establishes through the official appeals the property and its location available to the goddess and finds out that the debtor has property belonging to several more persons on the right of joint partial ownership.

 According to Art. The Law of Ukraine “On Enforcement Proceedings” involves enforcement of decisions: the recovery of funds, securities, other property (property rights), corporate rights, property rights of intellectual property, objects of intellectual, creative activity, other property (property rights) the debtor, including if they are from other persons or belong to the debtor from other persons, or the debtor owns them jointly with other persons.

 Compensation can be made by: 1) the allocation of a particle in kind; 2) sale of a share with the direction of the amount of proceeds for repayment of the debt; 3) the transfer of the rights and obligations of the co-owner-debtor to the creditor.

  In the first case, the conditions for the allocation of a particle in nature will be: 1) a share can be distinguished from common property in kind; 2) a share can be allocated not only without loss of its intended purpose, but without changing its intended purpose; 3) no objections of other co-owners.

 Confirmation of the inability to allocate in kind the debtor’s share is the expert’s opinion. At the same time, it is worth asking the expert what is the market / real value of the debtor’s share, since this amount will be reflected in the court decision and it will be on it that the amount of the debt will be reduced.

 Regarding the presence of objections of another co-owner against the allocation: sufficient proof will be a written submission of a proposal to another co-owner to give him consent to the allocation and / or purchase of him share of the debtor.

   In addition, it is necessary to send the debtor a proposal for the voluntary sale of his share in the property with the subsequent repayment of the debt.

   If the existing circumstances do not meet the specified conditions, you can switch to the other two options: the sale of a share with the sending of the amount of proceeds to repay the debt; transfer of rights and obligations of the co-owner-debtor to the creditor.

   When selling a share with a referral of the amount of proceeds to repay the debt, the debtor, in accordance with the procedure provided for in Article 362 of the Civil Code of Ukraine, notifies other co-owners thereof. If the co-owners are abandoned or simply did not report the purchase of a share, such a share may be sold to other persons. In this case, the debtor’s voluntary sale of his share in the joint venture may take place at the request of the creditor or the enforcement of a compulsory sale by selling a share of public auction.

   Maybe the third option is the enforcement of a penalty – the forced transfer of rights and obligations of the debtor to the creditor with compensation, if any, there is a cessation of the right of joint ownership between the co-owner of the debtor and other co-owners. The lender becomes a new participant in the right of joint ownership. The new co-owner has the right to register by obtaining a certificate of title.

   On the enforcement of foreclosed property to satisfy claims of non-mortgage holders, the state executor shall inform the mortgagee no later than the day after the attachment of the property or when it became known that the debtor’s property was seized in the mortgage and it is explained to the mortgagee the right to apply to a court with a claim for the release of pledged property from arrest.

   On conducting a description of the debtor’s property and imposing on him arrest, the state executor makes an act of description and seizure of the debtor’s property. During the description and arrest of the debtor’s property, the state executor has the right to declare a ban on disposing of him or her, and, if necessary, restrict the rights to use the property, seize or remove it from the debtor and transfer it to storage to other persons, as indicated in the act of description and seizure. The type, scope and time limit are established by the state executor in each particular case taking into account the properties of the property, its value for the owner or possessor, the necessity of use and other circumstances. Expropriation of the arrested property with the transfer of it for realization is carried out within the term established by the state executor, but not earlier than five days after the imposition of the arrest.

Author: Anatoly Perepelchenko

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