Ch5. Property Law — The Fundamentals of Ownership and Real Estate Rights

What Are Property Rights (Real Rights)?

A property right (real right in civil law tradition) is the right to directly and exclusively control a specific object. Where a personal right (obligation) is “the right to demand something from someone,” a property right is “the right to control the thing itself.”

Core Characteristics of Property Rights:

Directness: Direct control over the object (no third-party cooperation needed)
Exclusivity: Two identical property rights over the same object cannot coexist
Publicity: Must be publicly disclosed via registration or possession to take effect
Numerus Clausus: Only legally recognized types are allowed (closed list of property rights)

Types of Property Rights

Ownership

The most complete property right. The comprehensive right to use, enjoy the fruits of, and dispose of an object.

Power	Meaning	Example
Use	Directly utilize the object	Living in a house
Enjoyment	Collect fruits from the object	Collecting rent
Disposition	Sell, gift, or pledge as collateral	Selling an apartment

How Ownership Is Acquired:

By legal act: purchase, gift, exchange
By operation of law: inheritance, adverse possession, accession (accretion, commingling, processing)

Limited Property Rights

Property rights that carry only some of the powers of ownership.

① Usufructuary Rights — the right to use and enjoy another’s land

Superficies: Right to own buildings, structures, or trees on another's land
Easement: Right to use another's land for the benefit of one's own land
Chonsei (Right of Lease): Pay a lump sum deposit and use/enjoy another's real estate

② Security Interests — property rights serving as collateral for a debt

Possessory Lien: Retain an object until receiving payment for a debt related to it
Pledge: Transfer possession of movable property or securities to creditor as security
Mortgage: Use real estate as security while the debtor retains possession ★

Mortgages are the most important. When you take out a bank loan using your home as collateral, that is a mortgage.

Changes in Real Property Rights and Registration

Registration is the recording of changes in real property rights in an official public register (the land register).

Effect of Registration

Constitutive requirement for property right changes: no property right acquired without registration
(Civil Code: property right changes in real estate take effect only upon registration)

Exceptions: inheritance, compulsory acquisition, court judgment, auction — acquired without registration
(but registration required before disposition)

Structure of the Land Register

Title Section	Part A	Part B
Property description (address, area)	Ownership matters	Non-ownership property rights
Lot number, land use, structure type	Owner, attachment, injunction	Mortgage, chonsei, superficies

The Problem of Register Reliability

Civil law systems generally do not grant full reliance protection to the land register.

What lack of full reliance protection means:
Even if you trust the register and buy, the true rights holder may appear and you may lose protection.

Example: Purchasing a home registered under forged documents → possible obligation to return to true owner.

Therefore: When buying real estate, verify the register + inspect the property + use a licensed agent for safety.

Possession and Possessory Rights

Possession is the factual state of controlling an object. The law protects possession itself, even without a valid underlying right.

Functions of Possessory Rights

Protection of possession: Even without title, a person dispossessed by force can assert possessory remedies
Adverse possession: 20 years of continuous, open, hostile, and peaceable possession with intent to own → right to claim ownership through registration
Protection of good-faith possessor: A person in good-faith possession has the right to retain fruits collected

Adverse Possession Requirements:
20 years + intent to own + peaceable and open possession
→ Grants right to demand registration (not automatic title acquisition)

Possessing as owner (adverse possession can apply)
Possessing as tenant (adverse possession does not apply)

Co-Ownership

Tenancy in Common

Multiple persons own fractional shares of a single object.

Share disposition: each co-owner may freely dispose of their share
Use and enjoyment: in proportion to shares
Management decisions: majority of shares required
Disposition of whole: unanimous consent required

Joint Ownership (Partnership Property)

Partners own the property jointly. Individual shares cannot be separately disposed of. Example: partnership assets in a business partnership

Collective Ownership (Association Property)

Property of an unincorporated association (clan organization, church, etc.). Individual members hold no fractional share.

Security Interests in Depth: Mortgages

Characteristics of a Mortgage

Accessory nature: secured debt extinguished → mortgage also extinguished
Following nature: debt assignment carries the mortgage with it
Indivisibility: partial repayment does not reduce the mortgage
Real subrogation: if the mortgaged property is destroyed, mortgage attaches to insurance proceeds

Foreclosure and Priority of Distribution

Upon default, the mortgagee may apply for foreclosure auction and receive preferential repayment.

Priority Order for Distribution:
1st: Court costs of the auction
2nd: Property-related taxes (property tax, etc.)
3rd: Small-amount residential tenant deposits (statutory priority)
4th: Mortgages and registered leases (in order of registration date)
5th: General wage claims
6th: Other general unsecured claims

Practice Quiz

Q. Which of the following is NOT a usufructuary right? A. Superficies B. Easement C. Mortgage D. Chonsei (Right of Lease)

Answer: C. Mortgage — A mortgage is a security interest. Usufructuary rights involve using and enjoying another’s property; security interests serve as collateral for debt.

Q. Person A has openly and peaceably possessed Person B’s land with intent to own it for 20 years. Does A automatically acquire ownership?

No. After the adverse possession period runs, registration is still required to acquire ownership. If a third party completes a transfer registration before A registers, A may lose the benefit of adverse possession.

Key Summary

	Property Rights	Personal Rights (Obligations)
Object	Things	Debtor’s acts
Effect	Against all (erga omnes)	Against debtor only
Publicity	Registration / possession	Not required
Types	Closed list (numerus clausus)	Open (freedom of contract)

Memory tip: Ownership > Usufructuary Rights (superficies, easement, chonsei) > Security Interests (lien, pledge, mortgage) — from most complete to most limited

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