Sub-section III. Method of sale
436. (Method of sale, etc.)
1. Sale of the immovable shall be by tender or auction.
2. If, and only if, sale cannot be carried out by tender or auction, the sale may be
carried out by such other method as prescribed by the execution court.
3. In the case of sale by tender or auction, the execution court must set the date, time
and place of sale, and have the bailiff carry out the sale.
4. In the case of sale under Paragraph 3, the court clerk must give public notice with
a description of the immovable to be sold, the minimum sale price and the date,
and time and place of sale.
5. In the case of sales under Paragraph 3, Article 396 (Maintenance of order in the
sale premises) shall apply mutatis mutandis.
437. (Guarantee of offer to purchase)
1. Any person wishing to offer to purchase an immovable must provide a guarantee
in the amount of 10 percent of the minimum sale price, provided that the execution
court may set a guarantee that exceeds this amount if it thinks fit.
2. On request by a person other than the highest bidder, the execution court shall
promptly return the guarantee provided in accordance with Paragraph 1 to such
person(s) after the sale has been completed pursuant to Article 436 (Method of
sale, etc.).
438. (Prohibition of offer to purchase by debtor in execution)
No debtor in execution shall be entitled to make an offer to purchase.
439. (Determination of highest bidder, etc.)
1. After completion of the tendering or auction, the bailiff shall determine the highest
bidder, and, after announcing the name or title of said bidder and the amount
tendered, shall declare the date of tender or auction closed.
2. In case where two or more bidders tendered the highest price, the bailiff shall have
these bidders tender again to determine the highest bidder. In this case, the bidders
may not tender the purchase price less than the amount he/she previously offered.
3. If no bidder provided in the Paragraph 2 tenders, the highest bidder shall be
determined by a lot. The same shall apply in case where two or more bidders
tendered the same highest price in the [second] tender provided in the Paragraph 2.
4. After carrying the tender or auction, the bailiff must without delay prepare a tender
protocol or auction protocol that contains the following particulars and submit
same to the execution court:
(a) a description of the immovable;
(b) the date and time of tender or auction;
(c) description of the highest bidder and its agent;
(d) the price of purchase by the highest bidder;
(e) if the highest bidder could not be determined, this fact and the
circumstances; and/or
(f) if measures prescribed in Article 396 (Maintenance of order in the sale
premises) have been taken, the reasons and the measures taken.
5. The bailiff must have the highest bidder or his/her representative or agent sign the
tender protocol or auction protocol.
440. (Date for ruling of sale)
1. The execution court must set a date for the purpose of ruling on sale and [on such
date] must declare whether to permit or to refuse to permit the sale.
2. If the execution court sets a date for ruling on sale, it must give notice to that
effect to interested persons.
441. (Statements of opinion concerning permission or refusal to permit sale)
Persons having an interest in the permission or refusal of permission for sale of the
immovable may state their opinions on the date for ruling of sale concerning any
grounds listed in Paragraph 2 of Article 442 (Permission or refusal of permission for
sale) that affect their rights.
442. (Permission or refusal of permission for sale)
1. Except in cases described in Paragraph 2, the execution court must issue a ruling
permitting sale.
2. Where any of following grounds is found, the execution court must issue a finding
refusing permission for sale:
(a) The compulsory sale proceedings should not be commenced or continued;
(b) The highest bidder is not qualified or incapable of purchasing the immovable,
or its representative is not authorized to purchase the immovable;
(c) An application is made for refusal of permission for sale under Paragraph 1
of Article 445 (Application for refusal of permission for sale in a case where
the immovable has been damaged, etc.);
(d) There is a serious error in the procedure for ruling of minimum sale price;
and/or
(e) There is a serious error in the sale procedures.
443. (Measures in case of excessive sale)
1. Where more than one immovable property have been sold, and the whole of the
creditors’ claims and execution costs are likely to be satisfied by the price offered
for any one or more of such properties, the execution court shall reserve its ruling
of permission to sell the other properties.
2. In cases described in Paragraph 1, if there is more than one arrangement with
which the total of the offered price of one or more property is likely to satisfy the
whole of the claims of the creditors and execution costs, the execution court shall
first hear the opinion of the debtor in execution as to which property should be
sold.
3. The highest bidder for a property concerning which a ruling of permission to sell
has been reserved under Paragraph 1 may cancel his/her offer at the execution
court.
4. If the price has been paid for a property concerning which a ruling of permission
to sale has been made, the execution court shall cancel the compulsory sale
procedure of any property falling under Paragraph 3.
444. (Chomtoah appeal against ruling permitting or refusing to permit sale)
1. An interested party may file a Chomtoah appeal against a ruling permitting or
refusing to permit a sale, but only in cases where such party's rights would be
infringed by such ruling.
2. A Chomtoah appeal against a ruling permitting sale must be based on one of the
grounds listed in Paragraph 2 of Article 442 (Permission or refusal of permission
for sale) or on a serious error in the procedures of the ruling permitting the sale.
3. If it deems necessary, the Chomtoah appeal court may designate a respondent to
the Chomtoah appellant.
4. A ruling permitting or refusing to permit a sale shall only become effective after it
becomes final and binding.
445. (Application for refusal of permission for sale in a case where the immovable
has been damaged, etc.)
1. In cases where the immovable is seriously damaged by reason of natural disaster
or other cause not attributable to fault on the part of the highest bidder or owner
purchaser after the making of an offer to purchase, said highest bidder or
purchaser may submit an opinion for disallowance of the sale prior to a ruling
permitting sale being handed down, and may file a motion for cancellation of such
ruling if it has already been issued, until the time of payment of the price.
2. A Chomtoah appeal may be filed against a ruling on a motion for cancellation of a
ruling allowing sale under Paragraph 1.
3. A ruling upon motion under Paragraph 1 canceling a ruling permitting sale shall
not become effective until it becomes final and binding.
446. (Withdrawal of motion for compulsory sale after making of offer to
purchase)
In order to withdraw a motion for compulsory sale after the making of an offer to
purchase, a creditor in execution must obtain the consent of the highest bidder or
purchaser as the case may be.
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