Pawnshops: Are They Allowed to Use Other People's Pledged Assets?

Is a Pawn Shop Allowed to Use the Collateral Property of Others?

Article 313 of the Civil Code 2015 stipulates the obligations of the pledgee as follows:

1. Preserve and safeguard the pledged property; if the pledged property is lost, misplaced, or damaged, compensation for damages must be made to the pledgor.

2. Not to sell, exchange, gift, or use the pledged property to ensure the performance of other obligations.

3. Not to lease, lend, exploit usability, or enjoy the fruits and yields from the pledged property, unless otherwise agreed upon.

4. Return the pledged property and related documents, if any, when the obligation secured by the pledge is terminated or replaced by another security measure.

Based on current regulations, if you and the pawn shop owner have not agreed on allowing the owner to use the vehicle, the owner's act of using the vehicle is a violation of the law.

What Are the Rights of the Pledgee?

Article 314 of the Civil Code 2015 stipulates the rights of the pledgee as follows:

1. Request the person unlawfully possessing or using the pledged property to return it.

2. Deal with the pledged property as agreed upon or according to legal provisions.

3. Be permitted to lease, lend, exploit the usability of the pledged property, and enjoy the fruits and yields from the pledged property, if agreed upon.

4. Be reimbursed for reasonable expenses incurred in preserving the pledged property when returning it to the pledgor.

Respectfully!