On The Conflict And Interest Balance Between Realization Of Mortgage And Leasehold

The role of mortgage is to bring into play the security value of the object,while the role of leasehold is to realize the use value of the object.The difference in the way the object is used has led to the increasingly common coexistence of mortgage and leasehold in one object.Mortgage and leasehold,the former belongs to property rights and the latter belongs to claims,which are different in nature and content,and their coexistence would not give rise to conflicts.However,based on the special protection of leasehold,it has gradually acquired certain characteristics of property rights,while the difficulties focusing on the conflict between mortgage and leasehold have gradually emerged.In judicial practice,there are often disputes over the treatment of leasehold when the mortgage is realized.Under the current legal system,if the leasehold is established first and the mortgage is established later(i.e.lease first and mortgage later),the treatment according to Article 405 of the Civil Code is not controversial in practice.However,Article 405 of the Civil Code deleted the provision in the second sentence of Article 190 of the former Property Law that the mortgage is established first and the leasehold is established later(i.e.,mortgage first and lease later).Given the contradictions and conflicts between the provisions of original law and judicial interpretations,the amendment of the Civil Code regarding the conflicting rules of mortgage and leasehold will generate more controversies in practice.This article takes Article 405 of the Civil Code as starting point to discuss the criteria for determining the subordination of mortgage and leasehold,while analyzing the treatment of leasehold upon the realization of mortgage in cases where mortgage is established first and leasehold is established later.On this basis,it attempts to construct the fundamental norms of leasehold removal and fully discusses the rights and remedies of lessee after leasehold removal for the reference of practical circles.Since the conflicts involving leasehold and mortgage in judicial practice basically revolve around immovable property,the objects of mortgage and leasehold discussed in this paper are immovable property unless otherwise specified.