Encumbrances (Section C)

MORTGAGE

Original name: IPOTECA

Definition of this right: Mortgage is a real right on a movable or immovable affected of the execution of an obligations.(article 2343 cod civil)

Type of right according to national classification: Privileges and real guarantees

Observations:  Pursuant to Article 78 Paragraph 3 of the Law no.71 / 2011, from the entry into force of the Code civil, special privileges under special laws will become legal mortgages and will be subject to the civil code regarding the legal mortgage.

Mortgage is a real right conferring on its holder a right of pursuit/foreclosure and a preferential right.

It is an accessory right to whom applies the accesorium sequitur principalae.

May be subject to mortgage: property right, usufruct right over immovable property (art.2379 paragraph 1 letter b) Civil Code and accessories, the share of right to real estate (Article 2379, paragraph 1, letter c) civil Code and the superficies right. (Article 2379, paragraph 1, letter d) civil Code).

The mortgages over rents and leases which bearing on present and future products of an immovable property and the allowances paid under insurance contracts on payment of rent or lease shall be subject to rules of real estate advertising.

If not otherwise provided by law, the mortgage prevails against third parties from the day of its registration in the public register. (Article 2346 civil code)

Mortgage agreement shall be authenticated, ad validitatem.

Mortgage may be conventional or legal. (Civil Code article 2349, paragraph 2)

Juridical doctrine classifies mortgages in general and special, as well as mortgage securities and real estate mortgages.

Legal Mortgage is regulated only in real estate matters and cases are provided in art.2386 civil code.

There are also cases of legal mortgage regulated in special laws.

Extinction of right of mortgage is done by striking off from the land book or the total destruction of building.

1.1. With respect to the mortgage liability, the Romanian mortgage system prepares in general one options:

a) Extract includes the exactly amount of loan and the interests and other liabilities are mentioned without indicated the amount.

1.2. Regular LR information in this system also comprises ordinarily:

1. Contract or basis of obligation guaranteed by a mortgage (e.g. a loan)
2. Name of the mortgagee or creditor
3. Name of the mortgagor or debtor (land owner)
4. Deed whereby mortgage was constituted or awarded

However, there should not be expected any information about deadline of the loan or credit or other contract which is basis of the mortgage or the deadline of the mortgage

1.3. With respect to the mortgage rank (preference of the mortgage in comparison with other mortgages or encumbrances), this LR system has the following criteria:

a. Mortgage rank depends on date of registration of the mortgage, so whoever may ascertain mortgage rank taking into consideration the information on the date of registration of the mortgage.

In this LR system these are the following:

PRIVATE PROPERTY RIGHT

Original name: Dreptul de proprietate privată

Definition of this right: Private property right is the right that entitles the owner to possess, use and dispose exclusively, absolute and perpetual, within the limits established by law.(article 555 civil code)

Type of right according to national classification: Private property right

Observations:  As a rule, the thing (the res) that is the object of private property right is in the civil circuit and the right is alienable, sizeable and prescriptive.

Acquiring/constitution of private property rights are under the law by:

– Conveyance (e.g. contract of sale, donation etc.);
– Legal or testamentary inheritance;
– Accession/adherence;
– Acquisitive prescription;
– Decisions of courts of law when transferring the property right by itself;
– Effect of an administrative act, only in cases stipulated by law;
– Law which regulates other kind of acquisitions.

Any convention that displaces or constitutes real rights which are to be registered in the Land Book should be concluded in authentic form. (ad validitatem ).

PUBLIC PROPERTY RIGHT

Original name: Dreptul de proprietate publică

Definition of this right: Public property right is property right that belongs to the State or administrative-territorial units that covers things which by their nature or by a special provision of the law, are public interest or public use, the condition to be acquired by one of the ways provided by law (article 858  civil code)

Type of right according to national classification: Public property right.

Observations:  In the absence of contrary provisions of law, any applicable rules the private property right applies to public property right, to the extent they are compatible with it.(article 554 paragraph 2 civil code)

The right is inalienable, unseizable and imprescriptible.

The formation of the public property right is done under the law through:

– Public procurement;
– Expropriation for public utility in compliance with the law;
– Donation or legacy accepted under the law, if the thing, by the will of the donor or its nature, it becomes public interest;
– Convention for consideration, if the object of the right(the res) by nature or by will of the donee  becomes  public interest or use  ;
– Transfer of the immovable thing from the private domain of the State in its public or from private domain of administrative units in the public of its;
– Other ways established by law.

Public rights shall not be extinguished by lack of use and cannot be acquired by acquisitive   prescription by third parties.

In compliance with law, the object of public property rights may be put into administration or use and can be leased.

The termination of the public property right is done through the destruction of the thing which is the object of the right and by passing it in private property, if it will stopped to be public use or interest.(article 864 civil code)

SUPERFICIES RIGHT

Original name: Dreptul de superficie

Definition of this right: Right of superficies is the right to have or to build a construction on the land belonging to  different person, above or beneath the land, over which the person acquires a right of use. (article 693 paragraph 1 Civil Code)

Type of right according to national classification: Superficies right

Observations:  This right is established by legal documents, adverse possession (lat. usucapio) and other means provided by law.

It is a real estate right that bearing on a plot of land and is imprescriptible extinctive. ( Article 696 civil code)

Superficies right can be constituted at most for 99 years, after which it can be renewed.

The owner of the superficies right may alienate or burden construction, plantation or piece’s work without needing the consent of the landlord. (Article 695, paragraph 4 civil code)

With the alienation of construction, it is also transmitted the right to use the land. (i.e. alienated superficies right)

The right to use the land (superficies) must be alienated or mortgaged only together with the ownership of the building.

Extinction of superficies right occurs through:

a)  At the end of the defined period;
b) Through consolidation, if the land and building are owned by the same person;
c) The destruction of  construction , if there is an express stipulation in this regard;
d) In other cases provided by law (e.g., expropriation for public and termination of the lease).

USUFRUCT RIGHT

Original name: Dreptul de uzufruct

Definition of this right: The usufruct is the right to use the property to another person and to reap its fruits, just like the owner, but he has the duty to preserve its substance. (civil code Article 703)

Type of right according to national classification: Usufruct right

USE RIGHT

Original name: Dreptul de uz

Definition of this right: Right of use is the right of a person to use another’s work and to collect natural and industrial fruits only for their own needs and his family. (Civil Code Article 749)

Type of right according to national classification: Use right

Observations:  The object of the right of use may be exercised only for the purpose stipulated by law and cannot be a home. This right may not be transferred, and the object cannot be rented or leased (civil code Article 752)

HABITATION RIGHT

Original name: Dreptul de abitație

Definition of this right: Private property right is the right which entitled the holder to possess, use and dispose exclusively, absolute and perpetual, within the limits established by law. (Article 555 civil code)

Type of right according to national classification: Habitation right

Observations:  Right of habitation is a right of use that refers to a home.

This right may not be transferred, and the object cannot be rented or leased (article 752 civil code)

EASEMENT RIGHTS

Original name: Drepturi de servitute

Definition of this right: An easement is an encumbrance imposed on an immovable property belonging to a different owner.

Necessarily involves two immobile properties belonging to two different owners.

It constituted a real right over the immovable property of a person, other than the holder of the easement.

The immovable property in whose favour the easement is constituted is called dominant tenement and the property suffering it is the servient tenement.

Type of right according to national classification: Easement rights

Observations:  Easement may be established by legal act or adverse possession.

It is an accessory of dominant tenement and is only transmitted with it, as well as perpetual and indivisible.

There are many kinds of easements in Romanian law which is considered as a legal limits   stipulated by civil code: servitude of sewers, right to way, water usage (flow caused water, irrigation, the use of sources), distance between buildings, servitude of view, etc.

Cases of extinguish easement right are exhaustively listed in art. 770 civil code.

MANAGEMENT PUBLIC RIGHT

Original name: Dreptul de administrare publica

Definition of this right: Management right belongs to autonomous administrations or public administration or local authorities and other public institutions of national, county or local level. (Article 868 paragraph 1 Civil Code)

This right is established by Government decision or the county council or the local council. (Article 867 paragraph 1 Civil Code)

Type of right according to national classification: Management public  right

Observations:  Managing public property right is a real right, with mixed nature, both administrative and civil.

This right is inalienable, imprescriptible and unnoticeable.

CONCESSION RIGHT

Original name: Dreptul de concesiune

Definition of this right: The concession of public property is regulated both in the Civil Code and special laws (Emergency Ordinance no.554 / 2006 on the concession agreements of public assets and the Emergency Ordinance no.34 / 2006 on the award of public procurement a public works concessioncontracts and service concession contracts).

It is a real right derived from to right of public property, whose legal basis is the concession contract.

Type of right according to national classification: Concession right

Observations:  The concession right is a real right opposable erga omnes.

Concession contract is an intuited personae contract and a contract for consideration.

The duration of the concession cannot be more than 49 years, but it can be extended once, by the parties, for a period not more than half the initial duration. (article 7 of Emergency Ordinance no.554 / 2006 on the concession agreements of public assets)

FREE USAGE RIGHT

Original name: Dreptul de folosinta gratuită

Definition of this right: It is a real right that has as object public immovable property belonging to the State or territorial administrative units and its beneficiaries are only non-profit legal persons engaged in charitable or public utility or public services.
Acts of administrative authorities are the source of free usage right.

Type of right according to national classification: Free usage right

This information includes LR entries or notices related to restrictions decreed by judicial orders which mean either a claim on the property, or a challenge on the registered title, or an attachment of the property to debts as a result of judicial procedures, etc.

In this system:

a) Information on judicial restrictions or charges forms part of the regular land register extracts

b) Means of formal publicity ordinarily contains information about the judicial order that leads to the registration of notices or caveats; about if notices or caveats are temporary or indefinite entries, or warn about this issue.

For purposes of the information, orders of attachment or seizure decreed by administrative authorities lead to administrative restrictions or burdens.

Fiscal burdens (tax liabilities falling on the properties and entered in the Land Register) work in this system as real encumbrances.