Can a mortgage be banned from bankruptcy

Scope of the discharge of residual debt

In practice, the question arises again and again as to what effects the discharge of residual debt has on existing securities. The Federal Court of Justice had to rule on such a case in its decision of December 10, 2020 - IX ZR 24/20.

facts

On March 10, 2003, the defendant (B) filed a compulsory administrative procedure due to outstanding trade tax claims amounting to 50,122.27 € a compulsory security mortgage registered on a property of the plaintiff (K). With the resolution of June 13, 2010, the insolvency proceedings were opened for the assets of the K, then on June 10, 2016 he was granted the discharge of residual debt. With his lawsuit, K demanded that B be granted a cancellation permit with regard to the compulsory security mortgage. The lawsuit was unsuccessful in the first and second instance. With his revision approved by the appellate court, K ​​is continuing his application for a deletion permit.

Decision of the BGH: No right to cancellation

The Federal Court of Justice rejects the appeal.
The basis for K's possible cancellation claim is Section 1169 of the German Civil Code (BGB). According to this provision, the property owner can demand the waiver from the mortgagee if he is entitled to an objection by which the assertion of the mortgage is permanently excluded. Instead, he can also request the granting of a deletion permit in accordance with Section 1168 in conjunction with Section 875 (1) BGB.
However, the prerequisites of § 1169 BGB are not actually fulfilled. The prerequisite for a compulsory security mortgage is an enforceable title and an entry of the mortgage in the land register. The security mortgage is strictly ancillary, but there are objections and objections to the secured claim that do not prevent a claim from the mortgage. Such a case is given if the mortgage is supposed to compensate for the loss of the claim. Examples of this are limited heir liability (Section 1137 (1) sentence 2 BGB) or the objection to the statute of limitations (Section 216 (2) BGB). Even under the old law of the bankruptcy and settlement order, the reduction through a (compulsory) settlement (§§ 193 KO, 82 para. 2 VerglO) was a case in which the owner did not reduce the claim against the claim from the mortgage could object.
In insolvency proceedings, the mortgage entitles the holder to separate satisfaction (cf. § 49 InsO), although the personal claim secured by the mortgage can only be pursued in accordance with the regulations on insolvency proceedings and satisfaction by means of individual foreclosure is not possible. Nevertheless, the owner had to tolerate the foreclosure of the mortgage on the encumbered property without being able to invoke the lack of enforceability of the secured claim.
The purpose of the discharge of residual debt is to free the debtor from his liabilities that have not been satisfied in the insolvency proceedings (§ 1 sentence 1, § 286 InsO). It also works against all insolvency creditors (Section 301 (1) sentence 1 InsO). The discharge of the remaining debt, however, does not lead to the expiry of the claim affected by it, as can be seen from Section 301 (1) InsO. Rather, this becomes an imperfect obligation that can be fulfilled but not enforced. A mortgage that secures an insolvency claim does not pass to the owner according to § 1163 Abs. 1 S. 2 BGB.
According to Section 301 (2) sentence 1 InsO, the rights of the insolvency creditors from a right to separate satisfaction would otherwise not be affected by the discharge of residual debt. The mortgage entitles, however, to separate satisfaction from the encumbered property, as would result from § 49 InsO. In this respect, nothing else would apply to the compulsory security mortgage. The compulsory mortgage establishes a right to a property in accordance with Section 10 (1) No. 4 ZVG, which is also referred to in Section 49 InsO. This would also apply to Section 301 (2) sentence 1 InsO and remain unaffected by the discharge of residual debt.
The principle of the accessory nature of the mortgage does not apply to the extent that Section 301 (2) sentence 1 InsO makes a different provision.
K also does not need a tolerance title if he wants to obtain satisfaction by means of a foreclosure auction. This results from Section 867 (3) ZPO, insofar as the enforceable title is sufficient insofar as the entry of the mortgage is noted on it. Ultimately, it does not matter that G, if this provision did not exist or if he wanted to realize the mortgage in a way other than by way of a foreclosure auction, according to § 1147 BGB from the mortgage, he could sue for toleration of foreclosure on the property. An enforcement of the personal claim, which would no longer be possible after the discharge of residual debt has been granted, is not required for this.

The provision of § 868 ZPO is also not applicable in the case of the discharge of residual debt. According to this provision, the owner of the property acquires the compulsory mortgage if the decision to be enforced or its provisional enforceability has been lifted. Compared to Section 868 ZPO, Section 301 (2) sentence 1InsO is the more specific provision. This expressly states that the rights from the (compulsory security) mortgage remain unaffected.

Legal appreciation
The decision of the Federal Court of Justice is consistent and ultimately results from the clear interpretation of Section 301 (2) InsO. Really secured claims are therefore largely insolvency-proof, which will gain in importance in practice in view of the shortened period for obtaining discharge of residual debt.

Author Dr. Wolfgang PoppPosted on Categories crisis, restructuring and bankruptcy