Real estate purchased by either spouse constitutes an important component of marital joint property and serves as every family’s “safe haven”. After a court imposes seizure measures on the judgment debtor’s real estate, the spouse of the judgment debtor may file an outsider objection and institute an outsider objection lawsuit. For the spouse of a judgment debtor, how to safeguard legitimate rights and interests when the court seals real estate registered under the judgment debtor’s name?
Case Review
In the enforcement procedure for debts owed by Xu, the court sealed a residential property registered under Xu’s name. Xu’s spouse filed an outsider objection with the No.1 Intermediate People’s Court of Beijing, claiming the sealed property was marital joint property, requesting the court to terminate enforcement against the property and lift the seizure.
After the court ruled to dismiss the outsider objection, Xu’s spouse instituted an outsider objection lawsuit, requesting the court to halt enforcement of the property, confirm it as marital joint property, and rule that each spouse holds a 50% share.
Trial Result of Outsider Objection
Article 25 of the Provisions of the Supreme People’s Court on Handling Enforcement Objections and Reconsideration Cases by People’s Courts stipulates:
When examining an outsider’s objection, the people’s court shall determine the right holder according to the following criteria: for registered real estate, determination shall be based on the real estate registration ledger.
In this case, the disputed house is registered under the name of judgment debtor Xu. Since Xu failed to perform obligations determined by the effective judgment, the court’s adoption of compulsory enforcement measures against the property is legally well-grounded.
The claim by Xu’s spouse that the disputed house is marital joint property cannot exclude enforcement of the property. Accordingly, the court rejected the objection requests to terminate enforcement and lift the seizure. Dissatisfied with the ruling, Xu’s spouse filed an outsider objection lawsuit.
Trial Result of Outsider Objection Lawsuit
Upon review, the court held that the disputed house was acquired by Xu and his spouse during the subsistence of their marital relationship and therefore qualifies as marital joint property.
Nevertheless, Xu is the debtor and judgment debtor determined by effective judicial documents, and the property is registered under his name. The court’s imposition of compulsory enforcement measures on the property is proper. The spouse’s co-ownership right over the property is insufficient to exclude the people’s court’s compulsory enforcement.
People’s courts generally do not support partition of marital joint property during marriage, unless statutory exceptional circumstances apply. Hence, the court also rejected Xu’s spouse’s request to confirm a 50% ownership share in the disputed property.
Judge’s Remarks
Where a people’s court seals, seizes or freezes property actually possessed by or registered under a judgment debtor, and the judgment debtor’s spouse files an objection on the ground that the property is marital joint property, the case shall be handled in accordance with the outsider objection procedure prescribed in Article 227 of the Civil Procedure Law of the People’s Republic of China. Any party dissatisfied with the result may institute an outsider objection lawsuit.
In such cases, an objection filed by the spouse on the ground that the real estate is marital joint property shall be reviewed as an outsider objection. Since outsider objection adopts procedural review based on appearance of rights, the court’s sealing and disposal of the property in accordance with housing registration records complies with legal provisions.
A spouse dissatisfied with the ruling may file an outsider objection lawsuit. In this procedure, the court focuses its substantive review on two points:
- Whether the spouse enjoys legitimate rights over the disputed property;
- Whether such rights are sufficient to exclude enforcement.
First, through substantive examination, if the property is confirmed to be acquired during marriage, it shall legally constitute marital joint property, and the court shall recognize the spousal co-ownership.
However, Article 4 of the Judicial Interpretation (III) of the Supreme People’s Court on the Application of the Marriage Law of the People’s Republic of China stipulates:
During the existence of a marital relationship, where one spouse claims partition of joint property, the people’s court shall not support the claim, save for the following major reasons that do not harm the interests of creditors:
(1) One spouse has committed serious acts damaging marital joint property interests such as concealing, transferring, selling, damaging or squandering marital joint property, or fabricating marital joint debts;
(2) A person for whom one spouse bears statutory maintenance obligations suffers from a serious illness requiring medical treatment, while the other spouse refuses to bear the relevant medical expenses.
Therefore, courts do not support partition of marital property during marriage unless the aforesaid exceptional circumstances exist.
Second, Article 14 of the Provisions of the Supreme People’s Court on Sealing, Seizing and Freezing Property in Civil Enforcement stipulates:
A people’s court may seal, seize or freeze property co-owned by a judgment debtor and others, and shall promptly notify the co-owners. Where co-owners reach an agreement on partition of the jointly-owned property and the agreement is recognized by the creditor, the people’s court may affirm its validity. Where co-owners institute a partition lawsuit or the enforcement applicant institutes a partition lawsuit by subrogation, the people’s court shall grant permission. Enforcement against the property shall be suspended during the litigation period.
Accordingly, it is proper for the court to take compulsory enforcement measures against marital jointly-owned real estate, and the spouse’s co-ownership right is insufficient to exclude the court’s enforcement.
Thus, the spouse’s claim of co-ownership cannot bar the court’s enforcement of the real estate.
Legal Reminder
In judicial practice, where either spouse is listed as a judgment debtor and marital joint property is involved in enforcement, the court shall generally notify the co-owners and may lawfully adopt enforcement measures against the jointly-owned property.
When a spouse files an outsider objection lawsuit, the court will conduct substantive review of rights, verify whether the property to be enforced qualifies as marital joint property, and confirm the scope of the spouse’s co-ownership rights. Courts will also properly protect the legitimate property rights and interests of outsiders in enforcement proceedings.
How can the spouse of a judgment debtor safeguard his or her legitimate rights and interests?
Wumei Law Firm suggests the following approaches:
- Assist the spouse in performing legal obligations in a timely manner to avoid compulsory enforcement of joint property;
- Actively negotiate with the enforcement applicant to reach enforcement settlement, resolve the dispute properly and prevent the initiation of compulsory measures;
- After the property is confirmed as marital joint property, promptly assert co-ownership rights to the court, apply for protection of legitimate rights and interests in enforcement procedures, and reserve the due property share of the non-debtor spouse.