Real Estate Registration Review and Compensation Issues

Abstract: The examination standard of real estate registration affects the scope of the responsibility of the registration institution to a great extent. There are many reasons for the responsibility of the registration agency, but the responsibility relationship caused by the third party providing false materials to apply for registration is particularly worthy of study. This paper first introduces the two standards of real estate registration review adopted by various countries in the world, analyzes the reasons for the liability of the registration authority, and focuses on the relationship between the third party who provides false materials to apply for registration and the registration authority.

Keywords: real estate registration examination standard compensation liability

Article 21, paragraph 2, of the "Property Law" stipulates that if a registration error causes damage to others, the registration agency shall be liable for compensation. This article clarifies the liability of the real estate registration authority for erroneous registration, which not only provides a corresponding remedy for the victims who have suffered damage due to erroneous registration, but also plays a certain role in regulating and restricting the official behavior of the registration authority, and its positive significance is worthy of recognition. The assumption of liability is closely related to the criteria for registration review. Therefore, starting from the standard of registration review, this paper focuses on the causes of registration compensation and the responsibility relationship with the third party.

1. the examination standard of real estate registration

Real estate registration refers to the administrative act of the real estate registration agency on behalf of the government to register and publicize the ownership of real estate, real estate usufructuary rights, real estate security rights, etc., to confirm the ownership of real estate rights in accordance with the law and make it effective for the world. [1] The registration of immovable property involves not only the significant property rights of citizens, but also the liability of the State. The determination of the registration review standard will directly affect the compensation of the rights and interests of the victims and the conditions and scope of the state's liability for compensation.

(I) introduction of foreign real estate registration examination standards

On the issue of review criteria, States generally have two approaches: first, substantive review by the registry, with a broader liability for the State; and second, a model of formal review by the registry plus pre-substantive review by a third party or notary, with a narrower liability for the State.

1. Substantive examination

Substantive examination is the registration body not only to examine the registration application in the registration procedures of the law, but also to examine the substantive law of the rights of the relationship is valid. Countries such as Switzerland and Japan have adopted this approach. According to articles 963 and 965 of the Swiss Civil Code, the scope of the examination by the registration authority includes the application for registration, the written statement of the owner of the real estate, the documentary evidence of the applicant's right to dispose of the property, and the documentary evidence of legal reasons, of which "legal reasons" are the basic legal relations that lead to the change of real property rights. Japan's real estate registration law stipulates the documents to be submitted for registration and the investigation power of the registration authority.

2, the registration authority form review of the substantive examination of third-party institutions.

Formal review is the registration officer's application for registration, not to examine whether it is consistent with the rights relationship in substantive law, but only to examine whether the application for registration is legal in terms of registration procedures. The demarcation between formal examination and substantive examination lies in whether the registration authority, in addition to examining the registration consent, also examines the act of property rights, with the negative being the formal examination and the positive being the substantive examination. Few countries now adopt a simple form of review, and in order to achieve a safe and efficient coexistence of results, countries generally construct mechanisms that share the registration review function of the registration authority, I .e., a form of review by the registration authority plus a substantive review by a third-party body. The main countries that have adopted this model are Italy, Germany and France. For example, the Italian registration authority only examines whether the application materials of the parties are complete. In order to ensure the true validity of the registration materials, it takes the form of notarization or the judgment of the court to ensure the authenticity of the registration before the real estate registration. Article 2657 of the Italian Civil Code states: "Registration shall not take place if it is not registered in accordance with a judgment, a notarial deed or a private certificate with a signature or judicial authentication. Judgments and documents produced abroad shall be recognized." Article 2671 stipulates: "The notary or other public affairs officer who accepts the production or certification of documents that should be registered shall be obliged to complete the registration of the documents within the shortest time, and shall compensate for the damage caused by the delay. In the case of more than 30 days from the time of production or certification, the application of the fine stipulated in the special law shall not be affected." [2] There is a notarized participation in the transactions of real estate in Germany. As provided for in article 313 of the German Civil Code, a notarized certificate is required for a contract in which one of the parties bears the obligation to transfer or transfer ownership of the land. When registering other real property rights, the property rights are agreed to be certified by a notary. If there is an error in the work of the notary, compensation shall be made.

In summary, the practices of the above-mentioned countries take into account the security of real property transactions and the interests of innocent victims of registration errors. Substantive review by a third party The mechanism for sharing the risks and responsibilities of the registry review also takes into account the State's ability to compensate.

(II) the examination standard of real estate registration in China

In our country, it has been controversial whether the examination standard of real estate registration should be substantive examination or formal examination. Some experts suggested that the registration agency should have the obligation to examine whether the registration materials are true to avoid erroneous registration. Some experts also pointed out that the review of the registration authority is mainly a formal review, and substantive review cannot be done. Comrades from the competent authorities believe that the substantive review takes into account the safety of the results, but it is inefficient, and the registration authority also bears certain risks. Formal review is efficient and the registration authority does not take risks, but there are unsafe factors. [2](P203)

The author thinks that the real estate registration should adopt the substantive examination standard. This is because before the promulgation of the Property Law, most of China's original legal system adopted the standard of substantive review. In China, real estate registration mainly involves land, real estate, grassland, forest, ocean, geology and mineral resources. The "Land Registration Measures", "Forest and Forest Land Ownership Registration Management Measures" and "Marine Use Rights Registration Measures" all adopt substantive review standards. [1] Although China's real estate law stipulates that housing registration adopts formal review standards, in practice, the real estate management department also adopts a combination of substantive review and formal review. [2] From the perspective of transaction risk prevention, the use of substantive examination criteria in real estate registration can effectively prevent erroneous registration and help maintain the security of real estate transactions. The provisions of Article 12 of the Property Law also highlight the legislative intent of the legislator to choose substantive review.

Analysis of the reasons for the liability of 2. registration authorities.

The liability of the registration authority is related to whether it is at fault. From the point of view of the fault that causes the damage, there are mainly the following situations in which the registration error causes the loss to the counterpart:(1) the victim's own fault causes the loss of the registration error;(2) the registration authority's fault causes the loss of the registration error;(3) the third person other than the victim (hereinafter referred to as the third person) causes the loss of the registration error;(4) The common fault of the registration authority and the victim causes the loss of registration error;(5) The common fault of the registration authority and the third party causes the loss of registration error.

(I) the victim's fault or the joint fault of the registration authority and the victim causes losses due to registration errors.

When the damage is inevitable or aggravated by the victim's own actions, the victim is liable for his own fault, at which point the registration authority may be exempt from liability or partially exempt from liability. For example, if the registration information submitted by the victim to the registration authority intentionally or negligently is incorrect, the registration authority will register according to the information submitted by the victim, which will eventually lead to the loss of the victim. At this point, since the loss is caused by the parties' own actions, the victim bears the corresponding loss.

The loss of registration error caused by the fault of the (II) registration authority.

If the loss of registration error is caused entirely by the registration authority's own fault, then the registration authority bears full liability. From the point of view of registration practice, the registration authority should be liable for compensation in the following cases:(1) the registration authority delays the registration time without justifiable reasons. For example, when the applicant applies for registration, the registration authority should have gone through the registration formalities for the applicant in a timely manner, but the delay in processing without justifiable reasons caused a property right to be registered by another person, resulting in damage to the applicant;(2) Refusing without reason the legitimate request of the relevant party for inquiry and registration. For example, in the course of a transaction with a person, the counterparty requests to inquire whether a security or other burden has been placed on an immovable property, and the registration authority refuses to inquire without good reason, resulting in damage to the parties to the transaction. (3) Reject the party's right to request registration without justifiable reasons.

Losses (III) to Registration Errors Caused by Third Party Fault

If the wrong act of the registration authority is through the fault of a third party (such as the provision of false material or fraud) to cause damage, such damage is indirect damage to the registration authority, then the registration authority is not liable for compensation, what kind of liability? Some scholars believe that the registration authority to carry out substantive examination of registration, because the third party intentionally or negligently submitted false information, the registration authority review is not strict resulting in the loss of the victim, should bear the liability for compensation. Some scholars believe that although the registration authority conducts substantive review, because there are many related issues involved in the real estate registration process, the registration authority is limited to manpower, material resources, and time constraints. It is impossible to review everything in detail. Therefore, if the registration error It is caused by false information submitted by a third party intentionally or negligently, then the third party should be liable for compensation, and the registration authority is not liable. In the current situation where my country's financial resources are not sufficient, this can also reduce the country's liability for compensation. Some scholars also believe that in this case, the third party should bear the liability first, and when the third party is unable to bear the responsibility, the registration authority should bear the supplementary responsibility.

1. Relevant foreign regulations

Before solving this problem, let's take a look at the relevant practices in Queensland, Australia. According to the laws and regulations of Queensland, Australia, if the land right holder loses due to fraud in the application for registration by others, errors by the registrar or registration staff, loss or damage of registration documents, etc., the registration agency shall be unconditional, timely, full, and advance Compensation. After the registration agency compensates, it replaces the right holder and can exercise the right of subrogation against the person responsible for the loss. If the error of the staff of the registration authority was made in good faith or was not due to negligence, the registration authority cannot recover from it. Queensland's practice of not distinguishing the size of the fault of the registration authority in the process of registration error and paying compensation by the registration authority takes full account of the innocence of the victim and plays a good role in protecting the rights and interests of the victim. However, Queensland's approach is supported by other supporting systems. First of all, Queensland has established a land compensation fund, each land registration will be charged 2 Australian dollars into the compensation fund, about 2 million yuan of compensation fund income per year. Secondly, the registration agency is very cautious in recruiting staff, and provides good and complete job training for staff, as well as strict inspections of all links in the registration process. Therefore, there are very few compensation cases caused by the mistakes of the staff of the registration agency. Since 1996, the registration agency has accepted an average of 1 million registrations per year, less than 2 compensation cases per year, and paid an average of A $264,000 per year, with a maximum of A $640,000. From 2002 to 2003, there were 6 compensation cases, 5 of which were caused by the illegal acts of the same lawyer.

Germany has also experienced a change from substantive review to formal review in the way of registration review. Before 1782, the real estate registration in Germany implemented substantive examination. The Prussian land ownership law of 1782 adopted the theory of property rights and its causality, and registration was no longer subject to substantive review, but to formal review. One of the main reasons for the change in the registration review model is that the registry lacks the sources of information and does not have the conditions to conduct a substantive review; the time required to conduct a substantive review is generally longer, which affects the efficiency of the transaction; and the substantive review, which places greater responsibility on the registry in the event of a registration error. The legislative intent is to limit the liability of the registry.

2, the registration authority to assume responsibility and fault.

Of course, the provisions of these countries can not be fully applicable to China's national conditions. The author thinks that whether the registration authority should bear the liability in this case depends on whether the registration authority is at fault or not. The determination of the fault of the registration authority should be linked to the duties of the authority. The French Blongo decision states that the responsibility of the executive is not absolute and varies according to the needs of the service. Most official activities are responsible for general fault, and some official activities are only responsible for serious fault in order to reduce the responsibility of the administrative subject because of special difficulties or special importance. The jurisprudence of the French Administrative Court holds that official faults can be divided into general faults and heavy faults according to their severity. The method of distinction is based on the medium level of attention and diligence in a specific situation as the standard, the lack of medium level of attention and diligence as the general fault, the lack of more than the general standard, and the obvious and serious lack, or intentional behavior as the heavy fault. In the process of real estate registration, although we advocate that the registration authority should conduct substantive review standards, according to the practical comrades, substantive review is more difficult in specific operations. The real estate registration department has a heavy workload and heavy tasks; the registration department has fewer personnel, and manpower, There is no way to review every material one by one due to material resources and restrictions; and the third party will deliberately conceal some true information by providing false materials, therefore, for the registration department, it is more difficult, inefficient and risky to do substantive review.

In the process of formulating the Property Law, some people proposed to establish an intermediary agency system and a system for right holders to provide materials themselves. A large amount of substantive review work in registration should be undertaken by intermediary agencies. Through the industry norms and industry self-discipline of intermediary agencies, the materials are Substantive review to ensure authenticity. The registration authority conducts a formal review of the information of qualified intermediaries. The registration authority shall be liable for the loss caused by the registration error and shall compensate by way of state compensation, and the intermediary shall compensate for the registration error caused by the intermediary agency. The author thinks that in our country has not yet established the registration review body sharing mechanism, taking into account the actual situation of the registration authority, the registration authority shall bear the liability for its heavy fault. For example:(1) Registration errors caused by gross negligence of the registration authority. For example, if a person registers a house entrusted to him by a friend in his own name, the relevant documents provided by him are incomplete, but without examination by the registration authority, he is registered and the right is recorded in that person's name. (2) The staff of the registration authority intentionally colluded with others or maliciously colluded with others, causing damage to the parties to the transaction. (3) Loss of the victim due to loss or damage of the registration documents. For those materials that do not fall within the scope of the responsibility of the registration department, such as the contract between the parties, as long as the registration authority does the corresponding duty of care, even if it is not found to be hypocritical, the existence of fault should not be determined. For the case where the applicant applies for registration according to the judgment or administrative decision of the court, as long as the judgment and administrative decision are true after being examined and verified by the registration authority, even if the registration error is caused by the wrong judgment of the court, the error of the registration authority should not be recognized.

3. between the third party who provides false materials to apply for registration and the registration agency.

(I) responsibility relationship

When there are both the fault of the third party providing false materials and the fault of the registration authority in a case of registration error, and both of them are liable for compensation, what is the liability relationship? Are they joint and several liability, share liability or supplementary liability? How do these two kinds of liability apply in procedure? That is, how do they apply when both state liability and civil liability exist. The "Property Law" does not make clear provisions on this, and the academic and practical circles have the following views or practices:

1, the principle of share responsibility. According to the specific circumstances of the case, the court determines the share of responsibility that the registration authority should bear according to its discretion and orders it to compensate for the corresponding losses, which is a more common practice in judicial practice at present. The Supreme Court (2001) Law Interpretation No. 23 stipulates: "When determining the amount of compensation, the role of administrative actions in the process and result of damage should be considered." This requires the court to fully consider the role of the registration authority in the process of damage consequences when handling cases to determine the amount of compensation it should bear. If the real estate registration authority and its staff do not strictly review the materials based on general negligence and cause registration errors, they shall bear secondary liability; if the real estate registration authority has gross negligence or intent, it shall bear the main liability.

2, the principle of supplementary liability. The victim has priority to obtain compensation through other channels. When the victim cannot obtain compensation by exhausting other means of compensation, he can file an administrative compensation lawsuit, and the real estate registration authority shall bear supplementary compensation liability. Supplementary liability means that when multiple actors have several responsibilities based on their different causes, the person directly responsible for the damage shall bear the responsibility in the first order, and the person responsible for the supplementary liability shall bear the responsibility in the case that the person responsible in the first order is unable to compensate, the compensation is insufficient or the whereabouts are unknown, and can request compensation from the person responsible in the first order. The supplement of supplementary responsibility is mainly reflected in two aspects: first, the supplement in the sense of procedure. "Supplement" refers to the supplement of the order, that is, the directly responsible person shall bear the liability for compensation first, and the supplementary responsible person shall bear the liability for compensation only when the directly responsible person has no compensation ability or cannot determine who is the directly responsible person. Second, supplement in the substantive sense. How to understand the scope of "supplement"? Liability is a whole, which is a supplement, which means to supplement the insufficient compensation, that is, to make up the difference. In other words, the scope of the supplement is the part of the compensation that cannot be achieved. Some scholars have suggested that the additional responsibility of States in certain circumstances may also be based on the consideration of the difficulty of the requirement of substantive examination by the registry body. However, the author thinks that it is not appropriate to adopt supplementary liability. Scholars advocate that supplementary liability exists in some cases. What exactly are these cases? How to define them? There is no unified understanding. Supplementary liability is a secondary liability, the victim should first ask the perpetrator to bear the liability, when the perpetrator can not afford to ask the registration authority to bear the responsibility, which will increase the cost and difficulty of the victim's relief.

3. The principle of joint and several liability, which holds that when the parties make a claim for compensation, the registration authority shall first compensate for all the losses, and then the registration authority shall recover its share of the civil tort, which may be called joint and several liability. [3] (P37)

The coexistence of the two responsibilities mainly occurs in the following two situations: one is that if the registration error stems from the false registration caused by intentional and malicious collusion between the registration agency and the applicant, in this case, it constitutes a subjective and interesting contact. The other is that the registration error is caused by the applicant providing false certification materials, and the registration authority has not fulfilled its obligation to review. From the point of view of the composition of the tort, although the two have no subjective meaning, but the behavior is related, is the common cause of the same damage, belongs to the objective behavior related to the common harm, is still a common tort. Therefore, the author agrees with the joint and several liability.

Handling of Concurrence of (II) Liability

When a real estate registration compensation has both the fault of a third party and the responsibility of the registration authority to examine the false, it is actually a competition between the civil liability of the third party and the liability of the registration authority. The author thinks that when the two kinds of responsibilities coexist, it should be treated as follows:

(1) Give the victim the option of relief procedures. When the registration error leads to the victim's damage, if there is both the third party's behavior and the registration authority's fault behavior, both should be liable, and the victim should be given the right to choose the right of choice, that is, the victim has the right to choose the state compensation in the first civil compensation in the second, and also has the right to choose the civil compensation in the first state compensation liability in the second.

(2) When the victim chooses any one of the parties to pursue responsibility, the subject of that party shall bear full liability for compensation. Because the nature of the registration authority's compensation is a public burden, it is to make up for the loss of the innocent victim, so as long as the victim is not at fault and the innocent suffers undue loss, then he has the right to hold the infringing party liable. Secondly, both the third party and the registration authority are at fault, and there is a causal relationship between their actions and the victim's loss, and they are each responsible for their own faults. Finally, why is it not in favor of a share of liability between the registration authority and a third party? It is because the proportion of fault between them is difficult to allocate and will increase the burden on the victim.

(3) The Property Law provides for a system of recovery, which allows the registration authority to recover from the person who caused the registration error after assuming responsibility. The author thinks that whether the third party is at fault and whether the registration authority has serious fault is the standard to judge whether they bear the liability, and the degree of fault becomes the standard of whether the registration authority recovers and the proportion of responsibility sharing.

(4) In order to protect the interests of the victims to the actual implementation, should also be given the corresponding protection in the procedure. If the victim chooses a civil lawsuit but does not receive compensation, he can file an administrative lawsuit again, and the time when the civil lawsuit is filed shall be regarded as the interruption of the limitation of administrative litigation.

References:

[1] Wang Da. Administrative Law Issues in Property Law: Real Estate Registration System [J]. Copies of National People's Congress, Constitutional Law, Administrative Law, 2007(10).

[2] Complete set of legislative background and views on property law. Edited by the Civil Law Office of the Legislative Affairs Committee of the Standing Committee of the National People's Congress, Beijing: Law Press, 2007.

[3] Chang Pengxiang. Also on the legal remedies for errors in real estate registration, Legal Science [J],2006(5).
(This article won the 2009 National Lawyers Forum Excellent Thesis, 2009 Shandong Lawyers Forum Excellent Thesis Third Prize, Jinan City Excellent Thesis Second Prize)