HOME > CASES >

Where the real estate is mortgaged before the lease, the auction of real estate made by the court with the mortgagee’s consent does not affect the realization of the mortgage right, even without the consent of lessee or secondary lessee


Updated:2021-10-27    Views:

In the case of lawsuit of enforcement opposition between Hu X as the plaintiff

and Wang X, Wang XX, Zheng X as the defendants, Shenyang Metal Materials

General Factory, Zhou X, Shenyang Jiadian Logistics Co., Ltd., Qu X as the third

parties36, Hu X as the secondary lessee raised an opposition for enforcement on

the grounds that the Court’s auction was illegal without his consent and removal

of the lease in advance, and claimed that he had a legal and valid lease on the real

estate and refused to perform the enforcement duty of vacating the house requested

by the Court. The Court held that the real estate had been mortgaged before the

lease, and the auction of real estate with the mortgagee’s consent was a specific

way for the mortgagee to exercise the right of mortgage to realize the repayment

of the debt. The proceeds of the auction had priority in paying off the mortgagee’s

claim, and the lease right did not adversely affected the realization of the prior

mortgage, and should not accord with the articles about the lease right provided in

the Provisions of the Supreme People Court on Auction and Sale of Properties in

Civil Enforcement Proceeding by People’s Courts, “continuous existence in the to

be-auctioned property may affect the realization of the prior real right for security

and other priorities of getting repaid, the people’s court may eliminate them prior

to the auction”, so the auction did not need to obtain the consent of the secondary

lessee and remove the right of lease in advance. The Court held that the auction

was justified and rejected Hu X’s claim. 


Copyright 2019-2020 Dalian Maritime Court. All Rights Reserved