Civil Enforcement Act

Obligees entitled to receive a distribution or payment from the proceeds of the sale are the following:

an attaching obligee (limited one that has filed a petition for a compulsory auction or an auction to enforce a general statutory lien by the deadline for a distribution demand);

obligees that have filed a distribution demand by the deadline to demand distribution;

the obligee in any provisional seizure that is registered before registration of the seizure (meaning the seizure resulting from the first order commencing compulsory auction proceedings; the same applies in the following item); and

obligees holding any statutory lien (excluding general statutory liens held by the obligees stated in item (i) or item (ii)), pledge or mortgage which is registered (including provisional registration based on the provisional disposition prescribed in Article 53, paragraph (2) of the Civil Preservation Act) before registration of the order of the seizure and are extinguishable through the sale (including the holder of mortgage instruments connected to that mortgage).

If the right of the obligee stated in item (iv) of the preceding paragraph has been registered after registration of a provisional seizure, that obligee may receive distribution or payment only when the obligee effecting a provisional seizure has been defeated in the suit on the merits or the provisional seizure has ceased to be effective.

If proceedings for a compulsory auction involving a seizure have been stayed and a judicial decision to continue the proceedings has been issued under Article 47, paragraph (6), and if the attaching obligee subject to the stay is defeated in a suit or other dispute connected with that stay, obligees holding any right prescribed in paragraph (1), item (iv) which is registered after registration of the seizure and before registration of a seizure connected with the judicial decision of continuation may receive distribution or payment.

A claim for which the fixed due date has yet to arrive is deemed to have become due as it concerns distribution or payment.

If the claim referred to in the preceding paragraph bears no interest, the amount of distribution or payment must be calculated with the amount of principal, which together with the interest for the period from the day of distribution or payment until the due date calculated based on the statutory interest rate as of the day of distribution or payment constitutes the amount of the claim, being deemed to be the amount of the claim.

An obligee or obligor who is dissatisfied with the claim or amount of distribution of any of the obligees stated in the distribution list may, on the distribution date, file an opposition (referred to as "filing an opposition to distribution" below).

An enforcement court must implement a distribution of only the part of the proceeds against whose distribution no filing an opposition to distribution has been filed.

An obligee who has filed an opposition to distribution or an obligor who has filed an opposition to distribution against an obligee who does not have an authenticated copy of an enforceable title of obligation must file an action to oppose distribution.

The action referred to in the preceding paragraph is under the jurisdiction of the enforcement court.

The action referred to in paragraph (1) must be denied if the plaintiff fails to appear on the first date of oral argument, except when the plaintiff fails to appear based on grounds not attributable to them.

In a judgment on the action referred to in paragraph (1), the distribution list must be changed, or the distribution list must be rescinded for the preparation of a new distribution list.

An obligor who has filed an opposition to distribution against an obligee who has an authenticated copy of an enforceable title of obligation must file an action to dispute a claim or the action referred to in Article 117, paragraph (1) of the Code of Civil Procedure.

The filing of an opposition to distribution is deemed to have been withdrawn if the obligee or the obligor who has filed it fails to prove to the enforcement court that they have filed the action referred to in paragraph (1), or fails to prove that they have filed the action referred to in the preceding paragraph and to submit an authenticated copy or certificate of recorded information of a judicial decision to stay enforcement in connection with that action, within one week (or, if the purchaser is to pay money pursuant to the proviso to Article 78, paragraph (4), within two weeks) from the distribution date (or, for the filing of an opposition to distribution against a holder of a mortgage instrument who is not known, the day on which that holder became known).

If any of the following grounds exist for the claim of an obligee who is to receive distribution or payment, the court clerk must make a statutory deposit of money equivalent to the amount of the distribution or payment:

if the claim is one subject to a condition precedent or one with an uncertain due date;

if the claim is one held by the obligee effecting a provisional seizure;

if the document stated in Article 39, paragraph (1), item (vii) or Article 183, paragraph (1), item (ii), (e) has been submitted;

if an authenticated copy of a judicial decision temporarily prohibiting the enforcement of the statutory lien, pledge or mortgage (referred to as a "statutory lien or other charge" in this paragraph) under the claim has been submitted;

if provisional registration or provisional registration based on a provisional disposition under Article 53, paragraph (2) of the Civil Preservation Act has been made for the statutory lien or other charge under the claim;

if the amount for distribution is not fixed due to the existence of a statutory lien or other charge that is registered after the registration of a provisional seizure or a seizure subject to a stay; or

if an action to oppose distribution has been filed.

The court clerk must make a statutory deposit of money equivalent to the amount of distribution or payment for any obligee who failed to appear to the enforcement court to receive distribution or payment (including any unknown holder of mortgage instruments).

If a statutory deposit has been made under paragraph (1) of the preceding Article, and the grounds for that statutory deposit have extinguished, the enforcement court must implement distribution or payment of the deposit money.

If distribution is to be implemented pursuant to the provisions of the preceding paragraph, and it is no longer possible to implement distribution to an obligee connected with a statutory deposit based on the grounds stated in items (i) through (v) of paragraph (1) of the preceding Article, or to an obligee effecting a provisional seizure or an attaching obligee subject to a stay of enforcement connected with a statutory deposit based on the grounds stated in item (vi) of that paragraph, or if an obligee connected with a statutory deposit based on the grounds stated in item (vii) of that paragraph has been defeated in an action to oppose distribution filed by the obligor, the enforcement court must also change the distribution list for obligees who did not file an opposition to distribution.

If a statutory deposit is made under paragraph (1) of the preceding Article and the grounds for that statutory deposit have been extinguished, an obligee connected with that statutory deposit (when a statutory deposit is made for the reasons provided in item (vi) of that paragraph, an obligee effecting a provisional seizure or obligee effecting a seizure subject to a stay of enforcement; the same applies in this Article) must immediately notify the enforcement court to that effect.

If a statutory deposit is made under paragraph (1) of the preceding Article and two years have passed from the day when the statutory deposit is made (when notification is provided stating that the grounds for the statutory deposit have not been extinguished pursuant to the provisions of this paragraph, then the day that the last notification is provided) without the provision of the notification under the preceding paragraph, enforcement court must demand that, if the grounds for the statutory deposit have been extinguished, obligees connected with the statutory deposit provide notification to that effect, and if the grounds for the statutory deposit have not been extinguished, that those obliges provide notification to that effect.

If an obligee connected to a statutory deposit who received demand under the preceding paragraph does not provide notification under paragraph (3) or does not provide notification stating that the grounds for the statutory deposit have not been extinguished under the preceding paragraph within two weeks from the day that the demand is received, the enforcement court may make a decision that a distribution or payment is implemented in relation to the statutory deposit pursuant to the provisions of paragraphs (1) and (2) excluding the obligee connected to the statutory deposit.

A decision specified in the preceding paragraph becomes effective on the day when an inalterable period of one week passes from the day that the obligee connected to the relevant statutory deposit received the notification; provided, however, that this does not apply when the obligee connected to the relevant statutory deposit submits notification provided in paragraph (3) or notification that the grounds for the statutory deposit have not been extinguished provided in paragraph (4) before the inalterable period passes.

When an obligee connected to a statutory deposit provides notification to the enforcement court stating that the grounds for the statutory deposit have not been extinguished before the period prescribed in paragraph (4) passes, notification stating that the grounds for the statutory deposit have not been extinguished is deemed to have been received under that paragraph regarding application of the provisions of that paragraph.

An enforcement court must, to commence a forced administration procedure, issue a commencement order for forced administration and in it, declare that immovable property be seized for the obligee and prohibit the obligor from disposing earnings and, if the obligor has a claim for a rent or any other right to seek delivery related to earnings from the immovable property (referred to as a "delivery claim" below), order the person who has the obligation to make that delivery to the obligor (referred to as the "person obligated to deliver" below) to deliver the subject matter of the delivery to the administrator.

The earnings referred to in the preceding paragraph are natural fruits to be harvested on a later date and civil fruits that are already due and will be due on a later date.

The commencement order referred to in paragraph (1) must be served upon the obligor and any person obligated to deliver.

The commencement order referred to in paragraph (1) becomes effective against a person obligated to deliver when the commencement order is served upon that person obligated to deliver.

An appeal may be filed against a judicial decision on a petition for forced administration.

If a commencement order for a forced administration has already been issued, or if a petition for a forced administration is filed for immovable property for which a commencement order for enforcement against earnings from secured immovable property has been issued provided in Article 180, item (ii), the enforcement court is to issue another commencement order for forced administration.

A court clerk must, upon servicing a commencement order for forced administration upon a person obligated to deliver, make a demand to the person obligated to deliver to state the presence or absence of any order of seizure or disposition of seizure against the delivery claim and any other matters specified by the Rules of the Supreme Court within two weeks from the day of service of the commencement order. In this case, the provisions of Article 147, paragraph (2) apply mutatis mutandis.

When a commencement order for forced administration has become effective against a person obligated to deliver pursuant to the provisions of Article 93, paragraph (4), the effects of any order of seizure or disposition of seizure against the delivery claim, which is already effective, are suspended; provided, however, that this not applies to cases where the commencement order for forced administration becomes effective against the person obligated to deliver after the times stated in the items of Article 165 (including the cases where the provisions of the items of Article 165 (excluding item (iii) and item (iv)) are applied mutatis mutandis pursuant to Article 167-14, paragraph (1) and the cases where they are applied mutatis mutandis pursuant to Article 193, paragraph (2)).

When a commencement order for forced administration has become effective against a person obligated to deliver pursuant to the provisions of Article 93, paragraph (4), the effects of any order of provisional seizure against the delivery claim, which is already effective, are suspended.

The obligee in the order of seizure or disposition of seizure referred to in paragraph (1), an obligee who made a distribution demand in the procedure of enforcement against a claim (meaning the enforcement against a claim prescribed in Article 143) or enforcement against a claim arising from a small claims action (meaning enforcement against a claim arising from a small claims action as prescribed in Article 167-2, paragraph (2)) by the time of suspension of the effects of the order of seizure or disposition of seizure referred to in paragraph (1), and the obligee in the order of provisional seizure referred to in the preceding paragraph may receive distribution or payment in the forced administration procedure referred to in the preceding two paragraphs, notwithstanding the provisions of Article 107, paragraph (4).