Definition, concept, meaning, what is Domain reservation
1. Concept of reservation of domain
Covenant of retention of titleThe Covenant of retention of title is that Covenant that usually included in certain contracts of sale by which the seller reserves ownership of the thing sold until having received the full price, usually deferred.
Thus, the seller does not transmit good ownership, but only their possession.
What exists in these cases is a condition precedent, so until that condition is not met (i.e., until the full price is not paid), the property is not transmitted. Once satisfied the price, the property of good will be transmitted automatically.
This agreement does not affect the completion of the contract, but only to its completion and transmission of the domain.
It is very common in alienation of movable goods (e.g. cars), and quite rare in sale and purchase of real estate.
One of its main effects is that the non-payment of the price shall entail the resolution of the sale, and can the seller claim the return of the thing.
2. Definition of reservation of domainThe retention of title is a modality of the contract of sale in which the seller does not lose ownership of the alienated property in installments, until the buyer not to cancel the full price, in order to make sure the seller your credit.
It's a sale subject to the suspensive condition that the buyer pay all fees in that divided the sum agreed as the value of sales. Only to the cancelling of the debt will be considered either movable or immovable object of the contract owner.
It is supported only in some countries, with differences in regulation. For example in Colombia, which accepts it in article 952 of the commercial code, sets if the buyer does not pay all of the fees, the property continues to be seller, although the amount of fees paid must be reinstated to the purchaser. The buyer has three months to cancel unpaid fees and recover the property if the owner had not alienated him.
While the buyer holds the thing, you can not dispose of it at your leisure without the consent of the seller, and load with the same risks. If the thing will never materially transferred, risks are still seller who is also the owner.
If the owner does not authorize the sale of the good that is in the possession of the purchaser which are still not cancelled the debt, or ignore it, may choose to assert it, or will pay off the entire debt, ask the buyer to commit a crime.
Other countries which accept it are, Venezuela, Germany, Spain, Australia, Netherlands, England, Sweden and Poland. In Argentina, the article 1375 of the Civil Code equates it to the comisorio Pact.
3. Meaning of reservation of domain
Don sale domain reservation
1. Concept:The sale with reservation of ownership or domain Pact is selling in which, under the will of the parties is deferred the transfer of the thing or right sold so far in which the buyer paid the whole or a specified part of the price. As a result, is not called sale with reservation of title that in which transfer is voluntarily deferred until a time that has no relationship with the payment of the price.
2 Economic aspect:Sale with reservation of title is the strongest protection of the right of the seller to collect the price in terms of sales of movable property, so that facilitates transactions sales on credit with the advantages (and also possible disadvantages) that this entails for sellers and buyers.
In real estate, the mortgage is enough to ensure the seller against the failure to pay the price eventually; but in security matters, the legal protection of the seller established in the Civil Code was revealed insufficient to allow the free development of credit sale.
Indeed, of not being a sale with reservation of title, seller of movable property, in general, is not protected against the risk of insolvent buyer disposes and make the thing to a third tradition: the civil action against the purchaser is useless due to its insolvency; there against prosecution for misappropriation because yours was the thing that became alienated, and action against the third purchaser presents difficulty for section 794 of the Civil Code.
The retention of title, leaving ownership of the thing with the possibility to enforce even against third parties, the seller ensures the seller a guarantee, allowing you to sell on credit and make immediate delivery of the thing without limiting their operations to a select clientele, or excessively increase the price to cover large risks of loss from price.
On the other hand, the sale with reservation of title presents another economic aspect which our legislator had to deal with: the possibility of abuse of the seller to the buyer through the imposition of exorbitant clauses.
3. The retention of title before the special law:
Until it came into force the first law of sales with reservation of domain, on April 14, 1955, today replaced by the the 26 of December 1958 (G.O. No. 25.849, 29 December 1958, was argued frequently that it was impossible to negotiate the retention of title on the grounds that the Pact contradicted in the consensual nature of the sale. On the other hand, the difficulty was that interest regarding the retention of title was not opposable to all third party purchasers in good faith that they could invoke in his favour Article 794 of the Civil Code provisions.
The text of the law (art. 1,480 DC) left open the possibility of this mode of sale and the special law came to fill this gap in the security field.