Fiduciary alienation is a commonly utilized form of guarantee in financing and acquisition agreements, particularly in transactions involving real estate and vehicles.
The good’s ownership is temporarily given to the trustee (bank or financial institution) until the debtor has fully paid off the debt, with the debtor retaining direct possession of the good.
Can property that has been physically disposed of in enforcement proceedings be used as collateral?
The response relies on a thorough examination of laws and legal precedents, taking into account the specifics of the fiduciary transfer agreement and the entitlements of the fiduciary lender.
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What does fiduciary alienation mean?
Fiduciary alienation is an agreement where the borrower transfers the resoluble ownership of an asset to the lender as security for a debt.
The creditor owns the good in trust, but the debtor retains direct possession and usage rights.
This type of model is frequently used in financing as it provides increased security to the lender, enabling them to recover the asset in case of non-payment.
After the debt is forgiven, ownership of the item reverts back to the borrower.
Fiduciary alienation is governed by Law No. 9,514/1997 and Decree-Law No. 911/1969.
Can pawns be made with fiduciarily alienated goods?
Fiduciarily alienated assets in Brazil cannot be used as collateral to settle the debts of the fiduciary debtor.
The trustee retains ownership of the property until the debt is fully paid off.
Important exceptions exist.
- The purchasing rights of the fiduciary debtor on the good can be pawned even though the good itself cannot be pawned.
The creditor in the execution process can request the amount that has been paid by the fiduciary debtor.
Art. 835, XII of the CPC allows for the postponement of rights stemming from contracts.
Article 835 of the Civil Procedure Code specifies the preferred order for the pawn to follow.
Purchasing rights from promise of purchase and sale and fiduciary alienation in guarantee.
- In cases where the value of the goods is more than the debt owed, the surplus can be used as collateral, as long as it upholds the rights of the creditor.
- If the fiduciary property is not connected to guaranteeing a specific debt, it may be pledged under unusual circumstances.
How does the rental address system operate?
Practical advice for lawyers on fiduciary relationships
Examine the contract of fiduciary alienation.
Before suggesting or questioning the pawn, review the conditions of the fiduciary alienation agreement.
- Who is the person in charge.
- The amount owed by the debtor and the proportion that has already been paid by the trustee.
- The potential transfer of buying privileges.
Require authenticated copies of the contract at the office or financial institution to confirm clauses that impact the item’s pawnability.
Feather Acquisitive Rights Request
If the item cannot be used as collateral, inquire about the withdrawal rights of the trustee borrower, specifying the amount equivalent to the payments made.
Ask the financial institution’s office to provide information on the debt balance and available purchasing rights.
Attend the boundaries of unseizability.
Ensure that the asset is not safeguarded by insolvency protection laws, such as in the situation of a family home under Law 8.009/90.
Practical connections between property rights and trust transfer
While the alienated good cannot typically be used as collateral, utilizing purchasing rights as an option in legal proceedings is feasible.
Pledging alternative assets of the trustee in debt that are not associated with the fiduciary guarantee could also serve as an additional approach to debt recovery.
A financed vehicle in a debt enforcement scenario may not be used as collateral directly, but the portion already paid by the debtor could be pledged through the purchasing rights.
Jurisprudence regarding the pledging of assets and trust transfers.
Explanation of the app – adherence to the principle of collaboration and legality
1. The smaller decision focuses on a specific part of the application being taken into consideration, rather than on broader self-assumptions. It involves delaying judgment but only to a limited extent, specifically regarding purchasing rights. 2. The judgment deduction in the execution process involves satisfying the credit shown in the executive title. The creditor can identify the debtor’s rights that can be used to settle the debt through a sale. The magistrate, guided by cooperation principles and evidence of the debtor’s economic rights, approved the creditor’s request within legal boundaries, restricting only purchasing rights.
Judgment number 1374920, with Rapporteur LUÍS GUSTAVO B. DE OLIVEIRA from the Fourth Class, was issued on 23/9/2021 and published in DJE on 8/10/2021.
Purchasing rights feather – adherence to the legal order of preference
Article 805 of the Code of Civil Procedure requires that any delay be carried out in a manner that is least costly for the debtor, without disregarding the creditor’s interest in debt satisfaction as stated in Article 797. The substitution of the penalty is contingent upon the creditor’s agreement and must be evaluated for its appropriateness in satisfying the debt, ensuring no harm to the creditor, and complying with the legal provisions outlined in Articles 835, 847 §4, and 848 incise I of the Code. The proposal to replace a property pawned with vehicles under fiduciary alienation does not align with the legal requirements of Article 835, given that it may cause harm to the creditor and does not adhere to the legal framework specified in the Code of Civil Procedure.
Judgment number 1141935, with Rapporteur Esdras Neves from the Sixth Class, was issued on 6/12/2018 and published in the DJE on 11/12/2018.
Possibility of using rights to a well-located property in an unauthorized condominium as collateral
1. The understanding within the e. TJDFT framework allows for delays and divestiture in public auctions of possession rights related to irregular properties due to their economic value, particularly in the Federal District where public entities’ properties are often transferred to individuals. 2. It is permissible to pledge possession rights of properties in irregular condominiums as the encumbrance is on the personal rights, not the property itself. 3. Public auctions do not transfer ownership of the land, which remains with the current holder as per the real estate records. It is crucial for claimants to be aware of the property’s status as they may lose it if the Public Power invalidates the rights granted. 4. Acknowledging the economic value of possession rights on the property, it is feasible to repeat the public auction to allow the purchasing rights to be pledged for settling condominium debts. 5. Decision modified in favor of the appellant.
Judgment 1313096, 07132092820208070000, John Egmont as the Rapporteur, Second Class, Judgment Date: 27/01/2021, and published in the DJE on 09/02/2021.
An efficient substitute for fiduciary alienation is to establish procurement rights.
The pawning of goods in fiduciary alienation agreements involves specific details that highlight the unique aspects of this form of security.
The fiduciary good usually cannot be used as collateral, but there are legal options such as pledging the purchasing rights of the fiduciary debtor, which can help in repaying the debt.
Goods that are not connected to the fiduciary guarantee or that exceed the debt’s value could potentially be a solution, as long as the rights of the fiduciary creditor are respected.
A thorough examination of the pertinent contracts and laws, along with utilizing the appropriate procedural methods, is crucial for attorneys handling cases related to fiduciary alienation to secure the retrieval of debts in a lawful and efficient way.
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