Professional Documents
Culture Documents
NVE-OAA
TIP - TNA
there
is
a
transfer
of
ownership from the debtor to
the creditor.
there is no
transfer
of
ownership.
The
creditors
simply acquire the right to sell
the properties of the debtor
and apply the proceeds of the
sale to the satisfaction of their
credit.
creditors
Payment
extinguishes
the
obligation to the extent of the
value of the thing delivered,
unless the parties agree that
the
obligation
be
totally
extinguished
Only
possession
and
administration
with
authorization
to
convert
property to cash with which
the debts shall be paid
Assignment
presupposes
insolvency of debtor
several debts. He turns over property to his creditors who are given the authority
to sell the property and to apply the proceeds to his debt.
In payment by cession, property is turned over by the debtor to the creditors
who acquire the right to sell it and divide the net proceeds among themselves.
In payment by cession, the creditors do not own the property to be sold. The
creditors only have the power to sell. The net proceeds of the sale will be
distributed according to the agreement.
Payment by cession does not generally terminate all debts due since normally
there is still a balance due. The balance will continue to be due unless the parties
agree otherwise. Usually, the termination is only to the extent of the net proceeds. The
extinguishment of the obligation is pro tanto.
Payment by cession must be distinguished from insolvency.
debtor is still liable if there is a balance or proceeds of the prop not sufficient
to cover all obligation unpaid amount remains due and demandable