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BLACK LETTER RULES

(As of June 2007, Budapest Draft, Work in Progress, All Rights Reserved)

Book VIII

Acquisition and Loss of ownership in Movables

Chapter 1: General Provisions

Section 1: Scope of Application and Relation to Other Provisions

VIII. – 1:101: Scope of Application

(1) This Book applies to the acquisition, loss and protection of ownership in movables and to specific related issues.
(2) This Book does not apply to the acquisition or loss of ownership in movables
(a) by universal succession, in particular under the applicable law of succession and under the applicable company law;
(b) by expropriation or forfeiture, on execution or otherwise by authority of law [, with the exception of chapters 3 and 4];
(c) by separation from a movable or immovable asset;
[alternative: delete this subparagraph]
(d) by occupation, unless covered by chapter 4 of this Book;
[alternative: delete this subparagraph]
(e) by finding and
[alternative: delete this subparagraph]
(f) by abandonment.
[alternative: delete this subparagraph]

VIII. – 1:102: Priority of Other Provisions

(1) Where ownership in a movable has the effect of a security right, the provisions set out in Book IX apply and have priority over the provisions of this Book.
(2) Where ownership in a movable is transferred to or from a trust, the provisions set out in Book X apply and have priority over the provisions of this Book.

VIII. – 1:103: Application of Rules on General Contract Law by Way of Analogy

Where, under the provisions of this Book, proprietary effects are directly determined by an agreement, Books I and II apply, by way of analogy, to this agreement.
[(2) This rule does not apply to the following provisions: ….]

Section 2: Definitions

VIII. – 1:201: Movables

(1) “Movables” in the sense of this Book are corporeal movable assets, including animals, liquids and gases.
(2) In particular, this Book does not apply to
(a) claims, financial instruments and company shares;
(b) current money [banknotes and coins];
(c) intellectual or industrial property rights or other intangible assets;
(d) documentary intangibles, except documents entitling to delivery of movables [documents of title] and
(e) electricity.
(3) This Book also applies to a co-owner’s undivided share in a movable.

VIII. – 1:202: Registered Movables

Whether registration constitutes a requirement for the acquisition or loss of ownership is determined by national law.

VIII. – 1:203: Transferor

The “transferor” in the sense of this Book may be the owner, a person granted a right or authority to transfer ownership by the owner or, in the case of good faith acquisition (Chapter 3), a person without a right or authority to transfer ownership.

VIII. – 1:204: Ownership

Ownership is the most comprehensive right a person can have over a movable, comprising the fullest enjoyment of the movable and exclusion of interference by others within the limits of the law. This right includes, in particular, the right to use, modify, destroy, dispose of and recover the movable, with effect against any other person and that person’s creditors.

VIII. – 1:205: Co-ownership

(1) Ownership in a movable can be held by two or more co-owners in the form of shared or joint ownership. In both cases, each co-owner is owner of an undivided share in the whole movable.
(2) In the case of shared ownership each co-owner can dispose of his share by himself.
(3) In the case of joint ownership all co-owners have to act jointly in order to dispose of a share.
(4) Unless provided otherwise, the provisions on ownership set out in this Book apply to the undivided share of a co-owner.

VIII. – 1:206: Limited Proprietary Rights

Limited proprietary rights in the sense of this Book are
(a) security rights as provided in Book IX;
(b) usufruct rights [and similar rights to use] as provided by the relevant national law;
(c) [the lessee’s right under the draft on leasing of movables? – To be decided by the Bergen Group]
(d) [trust-related rights? – To be decided by the Trust Group]
(e) [others?].

VIII. – 1:207: Direct and Indirect Possession

Possession means the exercise of direct physical control (by the possessor) or indirect physical control (by means of another person) over a movable.

VIII. – 1:208: Possession by Owner-Possessor

(1) An “owner-possessor” is a person who exercises physical control (whether direct or indirect) over a movable with the intention of doing so as, or as if, an owner.
[(2) Owner-Possession can also be exercised indirectly by the owner-possessor by means of another person holding the movable for the owner-possessor (limited-right-possessor or agent-possessor).]

VIII. – 1:209: Possession by Limited-Right-Possessor

(1) A “limited-right-possessor” is a person who exercises physical control (whether direct or indirect) over a movable for the owner-possessor with the intention of doing so in her/his own interest in accordance with a specific legal relationship between her/him and the owner-possessor which gives the limited-right-possessor the right to possess the movable.
[(2) Limited-right-possession can also be exercised by the limited-right-possessor by means of another person holding the movable for the limited-right-possessor. In these cases, the other person exercises physical control over the movable
(a) as an agent-possessor in the sense of Article VIII. – 1:210 for the limited-right-possessor or
(b) as a limited-right-possessor for the other (indirect) limited-right-possessor with the intention to do so in her/his own interest in accordance with a specific legal relationship between her/him and the owner-possessor and/or in accordance with a specific legal relationship between her/him and the other (indirect) limited-right-possessor.]

VIII. – 1:210: Possession by Agent-Possessor

An “agent-possessor” is a person who exercises physical control (whether direct or indirect) over a movable for an owner-possessor or limited-right-possessor and does not fulfill the prerequisites of Article VIII. – 1:209. Such is the case especially
(a) where the agent-possessor is integrated in the household or other organisational area of the owner-possessor (the limited-right-possessor), and the owner-possessor (the limited-right-possessor) leaves the movable to him for practical reasons and he may give binding instructions as to the use of the movable in the interest of the owner-possessor (the limited-right possessor), or
(b) where he/she accidentally finds himself in the position to exercise the aforementioned control.

Section 3: Further General Rules

VIII. – 1:301: Transferability

(1) All movables are transferable except where provided otherwise by the applicable law. A contractual limitation or prohibition of the transfer of a movable does not affect the transferability of the movable.
(2) Accessories to immovable assets or other movables are not transferable separately. [Maybe to be elaborated in more detail.]

Chapter 2: Transfer of Ownership Based on the Transferor’s Right or Authority

Section 1: Requirements for the Transfer of Ownership

VIII. – 2:101: Requirements for the Transfer of Ownership in General

(1) The transfer of ownership in a movable requires
(a) the transferor’s right or authority to transfer ownership in the movable and
(b) delivery, an equivalent to delivery, an agreement as to the time ownership is to pass or, where provided so by national law, an entry into the register based on
(c) an obligation to transfer ownership.
(2) Where the obligation defines the movable in generic terms, ownership can only pass when the movable is identified to the obligation. Where movables form part of an identified bulk, Article VIII. – 2:108 applies.

VIII. – 2:102: Transferor’s Right or Authority

(1) The transferor must have the right or authority to transfer ownership in the movable at the time ownership is to pass.
(2) Where the transferor lacks a right or authority to transfer ownership at that time, the transfer takes place [takes effect] when the right is obtained or the entitled person has ratified the transfer at a later time. On ratification the transfer produces the same effects as if it had initially been carried out with authority.

VIII. – 2:103: Obligation to Transfer Ownership

(1) The obligation to transfer ownership may arise from a contract, other legal act or provision of law.
(2) For the purposes of this Book, an “obligation” in the sense of Article VIII. – 2:101 is also implied in a gratuitous transfer.

VIII. – 2:104: Delivery

(1) For the purposes of this Book, delivery of a movable takes place when the transferor gives up and the transferee obtains (direct?) possession of the movable in the sense of Article VIII. – 1:208.
(2) Where the movable is to be transported, delivery takes place when the respective carrier or the transferee obtains possession at the place of delivery of the transferor’s obligation. Irrespective of whether an independent carrier was engaged by the transferor or the transferee, a carrier possesses for the transferor in the sense of Article VIII. – 1:208 (2) before delivery [in the sense of sentence 1] has taken place. A carrier possesses for the transferee after delivery has taken place.

VIII. – 2:105: Equivalents to Delivery

(1) Where the movable already is in possession of the transferee, the creation of the obligation has the same effect as delivery.
(2) Where the movable is in possession of a third party, the same effect as delivery is achieved when the third party receives a notice from the transferor from which follows the transfer of ownership to the transferee, unless this is incompatible with the agreement of the parties.
(3) The same effect as delivery of the movable is achieved when the transferor gives up and the transferee obtains possession of means enabling the transferee to obtain possession of the movable, unless this is incompatible with the agreement of the parties.
(4) The same effect as delivery of the movable is achieved by an entry into the register in accordance with Article VIII. – 2:110.

VIII. – 2:106: Transfer by Documents of Title

Where a person exercising physical control (in direct possession?) over a movable issues a document containing the undertaking to deliver the movable to the current holder of the document, the transfer of that document is equivalent to delivery of the movable. The document may be an electronic one.

VIII. – 2:107: Agreement as to the Time Ownership is to Pass

The parties may agree on a different time ownership is to pass.
[Relation to “documents of title” (Article VIII. – 2:105 (3)(a)) and goods to be registered (cf. Article VIII. – 2:107) may be discussed.]

VIII. – 2:108: Transfer of Undivided Share in a Bulk

(1) “Bulk“ means a mass or collection of fungible movables which is identified as contained in a defined space or area.
(2) If the parties agree on an immediate transfer, the transferee of a specified quantity of an identified bulk, which has not yet been separated from the bulk and identified to the transferee’s relationship with the transferor, acquires immediate co-ownership in the bulk. The undivided share of the transferee in a bulk at any time shall be such share as the quantity of movables due to the transferee out of the bulk bears to the quantity of the movables in the bulk at that time.
(3) Where the aggregate of the undivided shares of transferees in a bulk determined under paragraph (2) above would at any time exceed the whole of the bulk at that time, the undivided shares in the bulk of each transferee shall be reduced proportionately so that the aggregate of the undivided shares is equal to the whole bulk.

VIII. – 2:109: Deemed Consent by Co-Owner to Dealings in Bulk Movables

(1) A transferee who has become co-owner of a bulk by virtue of Article VIII. – 2:108 shall be deemed to have consented to
(a) any delivery of movables out of the bulk to any other co-owner of the bulk, being movables which are due to him under his contract, and
(b) any dealing with or removal or disposal of movables in the bulk by any other co-owner of the bulk in so far as the movables fall within that co-owners undivided share in the bulk at the time of the dealing, removal or disposal.
(2) [ under construction ]

VIII. – 2:110: Transfer of Registered Movables

(1) Ownership in a movable which has to be registered according to the applicable national law can only be transferred by the required entry into the register, where the applicable national law provides that ownership can only be transferred by an entry into the register and the requirements of Article VIII. – 2:101 (1)(a) and (c) are met.
(2) Ownership in a movable which has to be or can be registered according to the applicable national law can be transferred by entry into the register or by delivery, an equivalent to delivery or an agreement as to the time ownership is to pass, where the applicable national law provides that ownership can also be transferred by entry into the register and the requirements of Article VIII. – 2:101 (1)(a) and (c) are met.

Section 2: Effects

VIII. – 2:201: Time Ownership Passes

(1) Ownership passes when all requirements set out in Articles VIII. – 2:101–2:107 [= section 1] are fulfilled.
(2) Where the parties have made an agreement as to the time ownership is to pass (Article VIII. – 2:106), that time is decisive.

VIII. – 2:202: Effects of the Transfer of Ownership

(1) At the time provided by Article VIII. – 2:201 ownership passes within the limits of the transferor’s right or authority to dispose, with effect between the parties and with effect against third persons.
(2) This rule does not affect rights between the parties under the law of obligations, may they be based on this Code or another provision of law or on an agreement of the parties, such as to
(a) the passing of risk;
(b) a right to withhold performance
(c) a right of stoppage in transit / right to take back goods in transit
(d) a right to fruits or benefits
(e) a right to use or an obligation not to use or otherwise deal with the movable.
(3) A right to withhold performance and a right of stoppage in transit [right to take back goods in transit?] in the sense of paragraph (2) has effect against the transferee, further acquirers from the transferee and the transferee’s general creditors. Such a right does not affect a lien or similar right of a carrier or warehouse-keeper or similar person. [Addition: The right under this paragraph amounts to a security right in the sense of Book IX.]
Alternative 1: para (3) restricted to right to withhold performance.
Alternative 2: no para (3) (= no third party effect at all).
(4) Where ownership is transferred or retained for security purposes, the effects are regulated in Book IX [Hamburg group].

VIII. – 2:203: Transfer Based on Invalid, Ineffective, Avoided or Terminated Obligation

(1) Where a movable is or has been transferred based on an obligation that is invalid, ineffective or avoided under Book II Chapters 5 or 6 [or other rules comparable to these provisions], ownership never passes or is deemed to have never passed to the transferee (retroactive proprietary effect). [This rule applies to the relationship between the parties as well as to the relationship to third parties.]
(2) Where a movable is transferred based on an obligation that has been terminated under Book III Chapter 3 or under special provisions on specific contracts) [or other rules comparable to these provisions], ownership does not pass to the transferee. Where a movable has been transferred based on an obligation that is terminated afterwards, termination has no proprietary effect.
(3) This Article does not affect any [obligatory] right to recover the movable [or its value] based on other provisions of this Code [or other rules comparable to these provisions].
[The article could be extended to:
avoidance in bankruptcy or on demand of a creditor (actio Pauliana); effect maybe: retroactive effect only in relation to the creditor(s);
“avoidance” of gratuitous transfers, if there will be specific rules (to be developed in accordance with the relevant working team);
“avoidance” of bequests (depending on inheritance law);
“avoidance” on other grounds, as may exist (e.g. in protection of family interests).]

VIII. – 2:204: Transfer Based on Obligation under Condition or Time Limit

(1) Where a movable has been transferred based on an obligation under a resolutive condition, the occurrence of that condition does not have retroactive proprietary effect, except the transfer of ownership has been made
(a) to administer the movable [to be decided by the trust group];
(b) for security purposes [to be decided by the Hamburg group] or
(c) gratuitously [to be decided in accordance with the gratuitous group].
(2) Where a movable is transferred based on an obligation under a suspensive condition, ownership passes when the relevant event occurs. If this creates a security right, the rules of Book IX [Hamburg group] apply.
(3) The same rules apply to a transfer based on an obligation under a resolutive or suspensive time limit.

Section 3: Special Constellations

VIII. – 2:301: Multiple Obligations to Transfer Ownership

Where the transferor is obliged to transfer ownership in a movable to two or more transferees, ownership is acquired by the transferee who first fulfils all requirements of section 1.

VIII. – 2:302: Indirect Representation / Transfer or Acquisition of Ownership on Account of Another

(1) In the situations covered by Article 3:301 PECL, if the agent acquires a movable from a third party on behalf of the principal, the principal directly acquires ownership in the movable (representation for acquisition).
(2) In the situations covered by Article 3:301 PECL, if the agent transfers a movable on behalf of the principal to a third party, the third party directly acquires the ownership in the movable (respresentation for alienation).
(3) The acquisition of ownership in the movable by the principal (paragraph 1) or by the third party (paragraph 2) takes place when two obligations to transfer between the principal and the intermediary and the intermediary and the third party [Article VIII. – 2:101 (1)(c)] exist and delivery, an equivalent to delivery, an agreement as to the time ownership is to pass, or an entry into the register in the sense of Article VIII. – 2:101 (1)(b) between the third party and the intermediary have occurred.

VIII. – 2:303: Passing of Ownership in Case of Direct Delivery in a Chain of Transactions

Where there is a chain of obligations to transfer ownership and delivery or an equivalent to delivery is effected directly between two parties within this chain, ownership passes with the effect as if it had been transferred from each member of the chain to the next.

Section 4: Additional Provisions

Not yet discussed with advisers & further debate within the working group needed!

VIII. – 2:401: Protection of Third Person Holding the Movable

Where ownership is transferred while the movable is in possession of a third person, the third person may set up against the transferee all [substantive and procedural] defences which it could have used against the transferor. If the third person re-surrenders the movable to the transferor before receiving notice of the transfer of ownership, it is protected against the transferee.
[Alternative to sentence 1:
Where ownership is transferred while the movable is in possession of a third person, the third person may set up its right of retention based on expenses made on the movable against the transferee’s claim to surrender the movable.]

Chapter 3: Good Faith Acquisition of Ownership

VIII. – 3:101: Good Faith Acquisition through a Person not Entitled to Transfer Ownership

(1) Where the transferor has no right or authority to transfer ownership in the movable the transferee nevertheless acquires and the former owner loses ownership provided that
(a) the requirements set out in Article VIII. – 2:101 (1)(c) and (2) are fulfilled;
(b) the transferee acquires the movable for value;
(c) the requirements set out in Articles VIII. – 2:104, VIII. – 2:105 or VIII. – 2:106 are fulfilled, or, for registered movables in the sense of Article VIII. – 2:110 (1), the movable is registered for the transferor and the transferee is entered into the register as the new owner; and
(d) the transferee does not know nor has reason to suspect that the transferor has no right or authority to transfer ownership in the movable at the time ownership would pass under Article VIII. – 2:201. The facts from which follows that the transferee has no reason to suspect the transferor’s lack of right or authority have to be proven by the transferee. Actual knowledge of the transferee has to be proven by the owner.
(2) Good faith acquisition in the sense of paragraph (1) does not take place where the movable has been stolen from the owner or the person possessing it for him.
(3) Paragraph (2) does not apply where the movable is acquired by a consumer through a person transferring the movable in the ordinary course of his/her trade, business or profession. This rule does not apply to cultural objects in the sense of Article VIII. – 4:101 (4).

VIII. – 3:102: Good Faith Acquisition of Ownership free of Limited Proprietary Rights

Where the movable is encumbered with a limited proprietary right of a third person and the transferor has no right or authority to dispose of the movable free of the third person’s right, the transferee nevertheless acquires ownership free of this right provided that
(a) the transferee acquires ownership under the requirements of chapter 2 or Article VIII. – 3:101;
(b) the transferee acquires the movable for value;
(c) the requirements set out in Articles VIII. – 2:104, VIII. – 2:105 or VIII. – 2:106 are fulfilled; and
(d) the transferee does not know nor has reason to suspect that the transferor has no right or authority to transfer ownership in the movable free of the third person’s right at the time ownership passes. The facts from which follows that the transferee has no reason to suspect the transferor’s lack of right or authority have to be proven by the transferee. Actual knowledge of the transferee has to be proven by the holder of the limited proprietary right.

Chapter 4: Acquisition of Ownership by Continuous Possession

Section 1: Requirements for Acquisition of Ownership by Continuous Possession

VIII. – 4:101: Basic Rule

(1) An owner-possessor acquires ownership by continuous possession of the movable
(a) for a period of ten years, provided that the possessor, throughout the whole period, possesses in good faith;
or
(b) for a period of thirty years.
(2) For the purposes of paragraph (1)(a)
(a) a person possesses in good faith if, and only if, the person possesses in the belief of being the rightful owner and is reasonably justified in that belief; and
(b) a person who was in good faith when obtaining possession is presumed to be in good faith for the rest of the period.
(3) Acquisition of ownership by continuous possession is excluded for a person who obtained possession by unlawfully depriving the former possessor of possession in the sense of Article VIII. – 6:201. Sentence 1 does not apply to a limited-right-possessor (Article VIII. – 1:209) who refuses to restore the movable after the legal relationship with the indirect possessor has ended.

VIII. – 4:102: Cultural objects

(1) Under this Chapter, acquisition of ownership of a movable qualifying as a “cultural object” in the sense of Article 1 (1) of Council Directive 93/7/EEC , regardless whether the cultural object has been unlawfully removed before or after 1 January 1993, requires continuous possession of the movable
(a) for a period of 30 years under the preconditions of paragraph (1)(a);
or
(b) for a period of 50 years.
(2) Member States may adopt or maintain in force more stringent provisions to ensure a higher level of protection for the rightful owner of cultural objects in the sense of this paragraph or in the sense of national or international regulations.

VIII. – 4:103: Continuous Possession

(1) Involuntary loss of possession does not exclude continuous possession in the sense of Article VIII. – 4:101, provided that possession is recovered within one year or an action is instituted within one year, which leads to such recovery.
(2) Where the owner-possessor is in possession of the movable at the beginning and at the end of the period there is a presumption of continuous possession for the whole period.

Section 2: Additional Provisions as to the Qualifying Period for Acquisition of Ownership

VIII. – 4:201: Extension in Case of Incapacity

(1) If a person subject to an incapacity is without a representative when the period would begin to run, the commencement of the period against that person is suspended until either the incapacity has ended or a representative has been appointed.
(2) If the running of the period has already begun before incapacity occurred, the period against such a person does not expire before one year has passed after either incapacity has ended or a representative has been appointed.
(3) The running of the period is suspended where the owner is a person subject to an incapacity and the owner-possessor is that person’s representative, as long as this relationship lasts. The period does not expire before one year has passed after either the incapacity has ended or a new representative has been appointed.

VIII. – 4:202: Suspension in Case of Impediment beyond Owner’s Control

(1) The running of the period is suspended as long as the original owner is prevented from exercising the right to recover the movable by an impediment which is beyond the owner’s control and which the owner could not reasonably have been expected to avoid or overcome. The mere fact that the does not know where the movable is does not cause suspension under this Article.
(2) Paragraph (1) applies only if the impediment arises, or subsists, within the last six months of the period.

VIII. – 4:203: Suspension and Renewal in Case of Judicial Proceedings

(1) The running of the period is suspended from the time whenjudicial proceedings are begun against the owner-possessor or a person exercising physical control for the owner-possessor, by or on behalf of the rightful owner, contesting the owner-possessor’s ownership or possession. Suspension lasts until a decision has been made which has the effect of res iudicata or until the case has otherwise been disposed of. Suspension has effect only in relation to the person who institutes the judicial proceedings.
(2) Suspension under paragraph (1) is to be disregarded when the action is dismissed or otherwise unsuccessful. Where the action is dismissed because of incompetence of the court, the qualifying period does not expire before six months have passed from this decision.
(3) Where the action is successful, a new period begins to run from the day when the effect of res iudicata occurs or the case has otherwise been disposed of in favour of the owner.
(4) These provisions apply, with appropriate adaptations, to arbitration proceedings and to all other proceedings initiated with the aim of obtaining an instrument which is enforceable as if it were a judgment.

VIII. – 4:204: Postponement of Expiry in Case of Negotiations

If the owner and the owner-possessor or a person exercising physical control for the owner-possessor negotiate about the right of ownership, or about circumstances from which acquisition of ownership by the owner-possessor may arise, the period does not expire before six months have passed since the last communication made in the negotiations.

VIII. – 4:205: Period of a Predecessor to be taken into Account

(1) Where one succeeds another in owner-possession and the requirements set out in this Chapter are fulfilled cumulatively by the predecessor and the successor in possession, the period of the predecessor is taken into account in favour of the successor.
(2) The period of a predecessor in bad faith is not taken into account with respect to acquisition of the successor in good faith in the sense of Article VIII. – 4:101 (1)(a).

Section 3: Effects of Acquisition of Ownership by Continuous Possession

VIII. – 4:301: Acquisition of Ownership

(1) After expiry of the period the original owner loses and the owner-possessor acquires ownership.
(2) When the possessor knows or has reason to know that the movable is encumbered with a limited proprietary right of a third person, this right continues to exist as long as this right is not itself extinguished by expiry of the respective period.

VIII. – 4:302: Extinction of Rights under Unjustified Enrichment and Non-contractual Liability for Damage

Upon acquisition of ownership, the original owner loses all rights to recover the movable and all rights to payment of the monetary value of the movable or of any future use of the movable under the provisions on unjustified enrichment (Book VII) and non-contractual liability for damage (Book VI).

Chapter 5: Production, Combination and Commingling

VIII. – 5:101: Scope of the Chapter and Party Autonomy

(1) The following rules apply to production, combination and commingling in the sense of Articles VIII. – 5:102-5:104 unless the consequences are regulated by an agreement of the parties.
(2) The effects of a party agreement under paragraph (1) are subject to the rules on proprietary security rights (Book IX).
(3) This Chapter does not affect the applicability of the rules on non-contractual liability for damage (Book VI).

VIII. – 5:102: Production

(1) Where a new movable is produced out of material owned by one or more other persons, the producer becomes owner of the new movable and the owner or the owners of the material acquire a claim for compensation against the producer proportionate to the value of the respective material at the moment of production, secured by a proprietary security right in the new movable.
(2) If the proprietary security right in the new movable is extinguished by a good faith acquisition by a third party (Chapter 3), the security extends to the proceeds of the sale.

VIII. – 5:103: Combination and Commingling

(1) Where movables owned by different persons are combined or commingled in such a way that separation would be impossible or economically unreasonable, and
(a) one of the component parts is to be regarded as the principal part, the owner of that part acquires sole ownership of the whole, and the owner or the owners of the subordinate parts acquire a claim for compensation against the sole owner proportionate to the value of the respective part at the moment of combination or commingling, secured by a proprietary security right in the whole movable.
(b) none of the component parts is to be regarded as the principal part, the owners of the component parts become co-owners of the whole, each for a share proportionate to the value of the respective part at the moment of combination or commingling. If, in case of more than two component parts, one component part is clearly subordinate in relation to other parts, the owner of this part only acquires a claim for compensation against the co-owners proportionate to the value of the respective part at the moment of combination or commingling, secured by a proprietary security right in the whole movable.
(2) If the proprietary security right in the combined or commingled movable is extinguished by a good faith acquisition by a third party (Chapter 3), the security extends to the proceeds of the sale.

VIII. – 5:104: Commingling of Movables of the Same Kind

(1) Where movables of the same kind, which are owned by different persons, are commingled in such a way that separation would be impossible or economically unreasonable, these persons become co-owners of the whole, each for a share proportionate to the value of the respective part at the moment of commingling.
(2) Each co-owner can claim a quantity equivalent to his undivided share out of the mixture [the whole].

CHAPTER 6: Protection of Ownership and Protection of Possession and Detention

Section 1: Protection of Ownership

VIII. – 6:101: Protection of Ownership

(1) The owner is entitled to obtain or recover possession of the movable from any person exercising physical control over that movable, unless this person has a right to possess the movable in the sense of Article VIII. – 1:209.
(2) Where another person interferes with the owner’s rights as owner or where such interference is imminent, the owner is entitled to a declaration of ownership and to a protection order.
(3) A protection order is an order which, as the circumstances may require,
(a) prohibits imminent future interference;
(b) orders the cessation of existing interference;
(c) orders the removal of traces of past interference.

VIII. – 6:102: Recovery of Movable after Transfer Based on Invalid, Ineffective or Avoided Contract or Other Juridical Act

(1) Where a movable is or has been transferred based on a contract or other juridical act that is invalid, ineffective or avoided in the sense of Article VIII. – 2:203, the transferor may exercise her/his right of recovery under Article VIII. – 6:101 (1) in order to recover physical control of the movable.
(2) Where the obligation of the transferee to restore the movable to the transferor, after a transfer based on an invalid, ineffective or avoided contract or other juridical act in the sense of Article VIII. – 2:203, is one of two reciprocal obligations that have to be performed simultaneously in accordance with Article III. – 2:104, the transferee may withhold the restitution of the movable in the sense of paragraph 1, until the transferor has tendered performance of, or has performed her/his own reciprocal obligation in accordance with Article III. – 3:401.

Section 2: Protection of Mere Possession

VIII. – 6:201: Definition of “Unlawful” Dispossession and Interference

(1) A person depriving the possessor (Articles VIII. – 1:207-1:210) of her/his possession or interfering with that possession acts “unlawfully” under this Section, if the person acts without the consent of the possessor and the dispossession or interference is not permitted by law.
(2) The mere denial by the current possessor to restore the movable to the other party after the legal relationship, which formerly made the possession of the possessor lawful, had ended, is not an unlawful dispossession or interference in the sense of this Article.

VIII. – 6:202: Self-Help of Possessor

(1) A possessor (Articles VIII. – 1:207-1:210) or a third person acting in the interest of the possessor may resort to self-help against another person who unlawfully deprives the possessor of her/his possession of the movable, or who otherwise unlawfully interferes with that possession, or whose act of unlawful dispossession or interference is imminent.
(2) The means of self-help are limited to such immediate and proportionate action as is necessary to regain the movable or to stop or prevent the dispossession or interference.
(3) Under the restrictions of paragraphs 1 and 2 self-help may be also directed against an indirect owner-possessor (Article VIII. – 1:208 [2]) who unlawfully deprives the limited-right-possessor of his possession or interferes with her/his possession in violation of the specific relationship between owner-possessor and limited-right-possessor. This rule applies equally to an indirect limited-right-possessor (Article VIII. – 1:209 [2] [b]) who unlawfully deprives the other limited-right-possessor of her/his possession or interferes with that possession.
(4) Where a person in the exercise of her/his right of self-help causes legally relevant damage to the person dispossessing the possessor or interfering with her/his possession in the sense of paragraph (2), Article VI. – 5:202 applies.

VIII. – 6:203: Entitlement to Recover as Protection of Mere Possession

(1) Where another person unlawfully deprives an owner-possessor or a limited-right-possessor of her/his possession, the possessor is, within the period of one year, entitled to recover the movable, irrespective of who has the right or better position (Article VIII. – 6:301) to possess the movable. The period of one year starts to run at the time of dispossession.
(2) The right to recover may also be directed against an indirect owner-possessor (Article VIII. – 1:208 [2]) who unlawfully deprives the limited-right-possessor of her/his possession in violation of the specific relationship between them. This rule applies equally to an indirect limited-right-possessor (Article VIII. – 1:209 [2] [b]) who unlawfully deprives the other limited-right-possessor of his possession.
(3) The right to recover is excluded if the person seeking to exercise it unlawfully deprived the other person of his possession within the last year.
(4) Where the other person in the sense of paragraph 1 invokes her/his alleged right or better position (Article VIII. – 6:301) to possess the movable as a defence or counter-claim, the obligation to return the movable according to paragraph (1) may be replaced by an obligation to hand the movable over to the court or other competent public authority or to a third person (pursuant to an order of the competent authority).

VIII. – 6:204: Entitlement to Protection Order to Protect Mere Possession

(1) Where another person unlawfully interferes with the possession of a movable or such interference or an unlawful dispossession is imminent, the owner-possessor or the limited-right-possessor is, within the period of one year, entitled to a protection order (Article VIII. – 6:101 (3)), irrespective of who has the right or better position (Article VIII. – 6:301) to possess, use or otherwise deal with the movable. The period of one year starts to run from the time when the interference began or, in cases of repeated interferences, from the time when the last interference began.
(2) The protection order may also be directed against an indirect owner-possessor (Article VIII. – 1:208 [2]) who unlawfully interferes with the possession of her/his limited-right-possessor in violation of the specific relationship between them. This rule applies equally to an indirect limited-right-possessor (Article VIII. – 1:209 [2] [b]) who unlawfully interferes with the possession of the other limited-right-possessor.

VIII. – 6:205: Persons Succeeding the Unlawful Dispossessor in Possession

(1) A person succeeding the unlawful dispossessor (in the sense of Article VIII. – 6:201) in possession of the movable is treated in the same way as the unlawful dispossessor him/herself under this Section, provided that he/she knows or has reason to know of the existence of the unlawful dispossession.
(2) Knowledge or imputed knowledge in the sense of paragraph (1) is not required where the person succeeds in possession by virtue of death of the unlawful dispossessor.

[Section 3: Protection of Better Possession]

[VIII. – 6:301: Entitlement to Recover in Case of Better Possession

(1) A former owner-possessor or former limited-right possessor is entitled to recover possession of the movable from another person exercising physical control over that movable, if the former possession was “better” than the current possession of the other person in the sense of paragraph (2).
(2) The former possession is “better” than the the current possession if the former possessor is in good faith and has a right to possess, while the other person has no right to possess the movable. Where both persons are in good faith and have a right to possess the movable, the right derived from the owner prevails over a right derived from an owner-possessor who is not the owner; if this does not apply, the older rightful possession prevails. Where both persons are in good faith, but neither has a right to possess the movable, the current possession prevails.]

[VIII. – 6:302: Entitlement to Protection Order in Case of Better Possession

Where another person interferes with the possession or such interference or a dispossession is imminent, the owner-possessor or the limited-right-possessor, who is in good faith, is entitled to a protection order (Article VIII. – 6:101 (3)), unless the other person would, in case of dispossession, have a better possession in the sense of Article VIII. – 6:301 (2), or the third person has a better right to use or otherwise deal with the movable than the owner-possessor or limited-right-possessor.]

Section 4: Other remedies

VIII. – 6:401: Non-Contractual Liability

The owner and the limited-right-possessor are entitled to reparation for an infringement of their right of ownership, or their right to possess the movable under the terms of Article VI. – 2:206.

CHAPTER 7: Consequential Questions on Restitution of the Movable

VIII. – 7:101: Damage or Loss of the Movable During Possession

Where the possessor must restore the movable to the owner (Article VIII. – 6:101) and the movable has been destroyed or deteriorated during possession, the rights of the owner resulting from this damage are regulated by Book VI. The same applies where the movable was damaged or lost during possession, but is not possessed any more.

VIII. – 7:102: Fruits and Uses from the Movable During Possession

(1) Where the possessor must restore the movable to the owner (Article VIII. – 6:101) and the possessor obtained fruits or made use of the movable during possession, the rights of the owner resulting from such benefits are regulated by Book VII.
(2) Rights of the owner related to fruits or uses the possessor failed to collect during possession are regulated by Book VI.

VIII. – 7:103: Expenses Made on the Movable During Possession

(1) Where the possessor must restore the movable to the owner (Article VIII. – 6:101) and the possessor made expenses on the movable during possession, the possessor’s entitlement to reimbursement of such expenses is regulated by Books V and VII.
(2) The possessor is entitled to retain the movable in order to secure the rights under paragraph (1).
(3) The possessor is entitled to remove improvements from the movable provided he or she still owns the relevant part (Article VIII. – 6:101) and the movable can be restored to the owner in its previous condition.