[Direct answer]In the Beijing area, are secured creditors given priority repayment in bankruptcy proceedings? This is a practical issue of widespread concern among parties involved. According to the Contracts Chapter of the Civil Code of the People's Republic of China (effective January 1, 2021) and the Civil Procedure Law of the People's Republic of China (amended on December 24, 2021 and effective January 1, 2022), handling such matters requires grasping the core elements and evidence, and asserting rights in accordance with the law. Whether a favorable outcome can be achieved depends on the clarity of the facts, the adequacy of the evidence, and the choice of legal procedures, rather than on promises of outcomes. It is recommended to sort out materials and fix key evidence as soon as possible, and to formulate a plan with the assistance of a professional lawyer to avoid losing rights due to exceeding the statutory time limit or insufficient evidence. For more details, please refer to the following link:\nLegal services for creditor-debtor disputes.

I. Problem background and typical scenarios

Are secured claims given priority repayment in bankruptcy? Related needs are also quite common in the Beijing area. When handling such cases, it involves both substantive rights and procedural choices. In combination with the above, we can provide more professional legal services to our clients.Provide legal services for case executionBased on practical experience, it is recommended that the parties first clarify their legal relationships before deciding on the path of protecting their rights or negotiating with others.

II. Key points of dispute

The focus of disputes in such cases often lies in three aspects: first, whether the creditor-debtor relationship is established, and whether the promissory notes, transfer records, and reconciliation statements form a complete chain of evidence; second, whether the interest and penalty are legal, and the part exceeding the protection cap will not be supported; third, whether the enforcement can be carried out, and the core issues are asset investigation and transfer evasion. Each of these aspects requires evidence and strategies to support them.

III. Professional analysis by Hengluo Law Firm

Based on a related case handled by our firm, it can be seen that this case involves a dispute over the liability of shareholders for damaging the interests of the company's creditors. Ma * and A Company had a dispute over the intermediary contract, and the effective judgment ordered A Company to return the intermediary service fee of 423,500 yuan. After enforcement, A Company had no property available for execution, and the execution was terminated. Ma * entrusted Yuan Hang, a lawyer from Beijing Hengluo Law Firm, and found that Liu * and Zhang *, the shareholders of A Company, had not paid in their capital in full. The core dispute is whether the shareholders' payment period can be accelerated under the subscribed system. Applicable laws: the "Judicial Interpretation of the Company Law (III)", the "Nine Civil Cases Memorandum", and the provisions related to the causes of bankruptcy. The lawyer filed a lawsuit against the shareholders for damaging the interests of the company's creditors, and the court ruled that Liu * should bear supplementary compensation liability within the scope of 9 million yuan unpaid and Zhang * should bear supplementary compensation liability within the scope of 1 million yuan unpaid. Hengluo Law Firm advises that in handling such cases, it is necessary to focus on the core points and organize evidence and legal arguments around the disputed issues. This case is handled by Beijing Hengluo Law Firm.Yuan HangThe attorney (practice certificate number: 11101202110286151, subject to the certificate issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

The legal basis mainly includes the provisions of the Civil Code of the People's Republic of China (implemented on January 1, 2021) on the validity of contracts, loans, and breach of contract liability; the provisions of the Civil Procedure Law of the People's Republic of China (amended on December 24, 2021 and implemented on January 1, 2022) on preservation, enforcement, and credit punishment; as well as relevant judicial interpretations on enforcement. Practical suggestions: Creditors should first fix the promissory notes, transfer records, and account reconciliation documents; apply for property preservation before and after suing to prevent transfer; apply for enforcement and asset investigation immediately after the judgment; and pay attention to the debtor's refusal to execute the judgment and inclusion in the credit blacklist if the debtor has no assets. For enterprise debts, relevant provisions can be combined with other legal provisions to ensure the effectiveness of enforcement.Business and contract dispute services for enterprisesClarify responsibilities.

5. Henglu Law Firm's Reminder

The recovery of creditor's rights and the collection of evidence and property clues are the two core aspects. There are three key points: leaving traces during lending and transactions, refusing cash and oral agreements; applying for property preservation before or during litigation; and applying for enforcement and providing property clues promptly after the judgment. It is essential to avoid exceeding the three-year statute of limitations. If professional support is needed, you can seek assistance from relevant professionals.Special services and other case servicesThe docking team.

When asserting a claim, evidence and property clues are the two core elements. It is recommended to sign a written contract and use transfer payments when borrowing or conducting transactions, and to refuse cash and verbal agreements. Keep loan notes or contracts, transfer certificates, account reconciliation and collection records, and guarantee and mortgage documents. Apply for property preservation as early as possible before or during litigation to seize the other party's accounts and real estate. After the judgment, promptly apply for enforcement and continue to provide property clues. Apply to be listed on the credit-untrustworthy list, and pursue enforcement responsibility against those who refuse to perform their obligations. Note the three-year statute of limitations. When collecting debts, keep records to interrupt the statute of limitations. When entrusting a lawyer, systematically evaluate the completeness of the evidence chain and the probability of recovering the debt. The court will not support interest exceeding the protection cap. Before suing, calculate the recoverable principal and interest and the cost of protecting rights to avoid suing blindly and increasing their own burden and litigation cycle.

VI. Frequently Asked Questions

Q1: After the debtor enters liquidation, can the mortgagee still recover the housing payment preferentially?

The creditor can prioritize the repayment of the mortgage value, which is known as the right of exclusion.According to Article 109 of the Enterprise Bankruptcy Law of the People's Republic of China (effective June 1, 2007), a creditor with a security right over a bankrupt's specific property has the right to priority compensation for that specific property; Article 110 further stipulates that the portion of the secured property that remains unpaid after the secured assets are sold shall be distributed as ordinary claims. The prerequisite are that the security is legally established and registered in accordance with the law, and the secured property truly belongs to the debtor; unsecured ordinary creditors can only be compensated proportionally, and the gap between the two is very obvious in the distribution plan.

Q2: If a claim is made for priority compensation of the mortgage, which guarantee registration materials must be provided in full?

Prepare at least five items.(I) The main creditor's contract, such as a loan contract or a sales contract; (II) The original mortgage contract or pledge contract; (III) The real estate registration certificate or the movable property mortgage registration information, which proves that the guarantee has been legally registered and the registration order has been established; (IV) The evidence of the main creditor's claim not being satisfied, such as transfer records and collection letters; (V) The description of the corresponding relationship between the guarantee and the creditor's claim, which proves that the mortgaged property is registered under the debtor's name. According to the Property Law of the People's Republic of China (implemented on January 1, 2021), the real estate mortgage right is established upon registration. If the materials are incomplete, the administrator will require them to be supplemented. If the registration order is later, the compensation will be discounted.

Q3: If a lawsuit is filed to allocate the proceeds from the sale of the collateral, are the legal fees calculated based on the value of the subject matter?

The litigation fee rate for property cases shall be applied when the amount of the disputed price adjustment is used as the subject matter of the litigation.According to Article 13 of the "Measures for the Payment of Litigation Costs" (implemented on April 1, 2007), property cases are calculated in stages based on the amount of the claim, with the fee rate decreasing as the amount increases. The acceptance fee is borne by the losing party, and the case can be settled by mediation with a 50% reduction. If a secured creditor sues the administrator or ordinary creditors over the scope of priority compensation, they should specify the disputed amount in the lawsuit to facilitate verification. The fees for hiring a lawyer should be agreed upon in writing according to the "Measures for the Management of Lawyer's Service Fees" (implemented on April 1, 2007) on a per-case or target-proportion basis, to avoid verbal commitments.

Q4: After the plan for the sale of the guaranteed property is approved, when will the proceeds be distributed?

There are no fixed days, but the program nodes are clear, and the progress can be tracked step by step.According to Article 112 of the Enterprise Bankruptcy Law of the People's Republic of China (effective June 1, 2007), the sale of bankruptcy property at a reduced price shall be subject to a resolution by the creditors' meeting; subsequently, the administrator shall draft a distribution plan for the bankruptcy property, submit it to the creditors' meeting for voting, and implement the distribution after it is approved by the court. Secured creditors should pay attention to three key points: whether the valuation and pricing are reasonable, whether the sale method has been voted on, and whether the amount of priority compensation in the distribution plan is accurate. If there are any objections at any stage, they should be raised in writing in a timely manner to prevent the secured payment from being mistakenly included in the ordinary distribution.

Q5: I have the original mortgage contract in hand. Which registration and verification should I handle first today?

First, go to the real estate registration authority to retrieve the mortgage registration information and verify the registration status and priority order.On that day, three tasks can be completed: Firstly, go to the real estate registration center with your identity proof to print the mortgage registration record, and confirm whether the mortgage has been established and whether there are prior rights in the same order; Secondly, check whether the location and area of the mortgaged property are consistent with the contract provisions to prevent omissions or errors in the registration; Thirdly, submit a written guarantee claim declaration to the court or administrator handling the bankruptcy case, attaching the contract and registration certificate. According to the Property Law of the People's Republic of China (implemented on January 1, 2021), an unregistered real estate mortgage right is not established and can only be claimed as an ordinary creditor's right. The earlier the verification is carried out, the more proactive it will be.

If you are currently facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the necessary evidence, to avoid missing the statutory time limits.Legal services for creditor-debtor disputes·Attorney Yuan Hang·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and public adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. If a dispute arises, please consult a practicing lawyer in time.