Hypotheca

The institution of hypotheca (hypothec) probably developed as a modification of pignus, to which it bore a close resemblance. The chief difference between the two institutions was that whilst in the case of pignus the debtor or pledgor delivered possession of the pledged property to the pledgee or creditor, in the case of hypotheca no such delivery took place.

Hypotheca was constituted by a mere agreement whereby the debtor granted the creditor a real right in a thing as security for the discharge of a debt. In this case, neither ownership nor possession of the hypothecated property was transferred.^{^[553]}

Hypotheca seems to have evolved from a practice that arose in connection with the leasing of land. The landowner who wished to lease his land to a tenant required security for the payment of the debt, but the tenant often had only movables, such as cattle, slaves, farming equipment and similar property, which he needed to exploit the land (invecta et illata). Therefore, the landowner and the tenant would agree that the movables the latter brought onto the leased property as well as the future crop would serve as security for the payment of the rent, but would remain the property of the owner who would also retain possession. Originally, this agreement did not entail any rights, whether real or personal, for the lessor and was thus not enforceable. But by the end of the republican era it was rendered enforceable by means of an interdict, known as interdictum Salvianum, which enabled the lessor to obtain possession of the invecta et illata from the tenant if the rent was not paid.^{^[554]} However, this interdict did not grant real security since it could only be employed against the tenant and not against third parties in possession of the objects in question.

At a later stage the praetor introduced a more effective remedy in the form of a real action, the actio Serviana, by which the landowner as a holder of a real right could claim possession of the invecta et illata from any person in possession of such property. Once the landowner had obtained possession of the objects in question, he could proceed to exercise the ius distrahendi. Finally, when hypotheca was recognized as a form of real security applicable to any form of property and to all cases where a debtor-creditor relationship engendered an obligation, an analogous action developed that was referred to as actio quasi Serviana or actio hypothecaria.^{^{New Roman",serif;color:black'>[555]}}

An advantage of the hypotheca was that practically any movable or immovable thing and even incorporeal objects (such as a claim or a usufruct) or future things (for instance, a future harvest) could serve as security.^{^[556]} A general hypothec—a hypothec in respect of an entire estate—was also possible.

A hypothec was usually established by agreement (pactum) between the creditor and the debtor. The absence of formalities and the consequent lack of publicity entailed a risk of fraud and a new owner always had to take into account the possibility of eviction by means of the actio hypothecaria. There were, however, other ways of creating a hypothec. For example, a testator could stipulate in his will that a certain thing or things in his estate were to serve as security for the payment of a legacy. There developed, further, certain tacit or legal hypothecs (hypotheca tacita or legitima) that were established over a certain object or the whole estate of the debtor by operation of law and without prior agreement between the parties concerned. One of the most important of these hypothecs was the lessor's tacit hypothec over the objects brought onto the leased premises by the lessee (invecta et illata) and this hypothec served to secure payment of the rent.^{^[557]} Other examples of tacit hypothecs included the hypothec of the imperial treasury (fiscus) over the estate of its debtors, mainly in respect of taxes due to it^{^[558]}; the hypothec of a person under guardianship or curatorship over the estate of his guardian or curator for the fulfilment of obligations towards the former^{^[559]}; the hypothec of a wife over the property of her husband for repayment of the dowry^{^[560]}; and the hypothec of a claimant to a legacy or fideicommissum over the deceased estate as security for the payment of their legacy or performance of the fideicommissum?''^{^[561]}

Since the hypothecated property remained in the hands of the original pledgor, more than one hypothec could be established over the same property to secure obligations to different creditors.^{^[562]} However, this had a major disadvantage: it could easily happen that the value of the hypothecated thing fell short of covering the total amount of the debts secured.

In general, the creditors would be unaware of this prospect since, as previously noted, hypotheca was constituted informally without publicity and Roman law did not require the registration of hypothecs. In such a case, the applicable general rule was that the creditor whose hypothec was created at an earlier stage had a stronger right than that established later (prior tempore, potior iure).^{^[563]} This meant that the creditor whose hypothec had been created first was the first to satisfy his claim from the proceeds of the sale of the hypothecated property; thereafter, the claims of the successive holders of hypothecs were met until the proceeds were exhausted.^{^[564]} The creditors whose hypothecs came last were the ones who suffered the possible loss. It should be noted, moreover, that only the first secured creditor could exercise the right to sell the property at issue (ius distrahendi). If he failed to exercise this right, the next holder of a hypothec could come forth and tender payment of the first holder's claim thereby taking his place. This right of a successive holder of hypothec was referred to as ius offerendi et succedendi?^{^[565]} There were a number of exceptions to the prior tempore, potior iure rule insofar as certain hypothecs were deemed privileged and therefore accorded priority, even though other hypothecs may have preceded them chronologically. Examples of such preferent hypothecs were the tacit hypothecs of the fiscus and the wife (mentioned previously) and, in later times, hypothecs that were registered with the authorities or effected in writing before three witnesses.^{^[566]}

Finally, as already indicated, the prior tempore, potior iure rule could be bypassed by the exercise of the ius offerendi et succedendi: a subsequent holder of a hypothec could offer to discharge the debt due to an earlier holder and in this way take his place for both debts.^{^[567]}

3.7.4

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Source: Mousourakis G.. Fundamentals of Roman Private Law. Springer, 2012.— 366 p.. 2012

Hypotheca

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