Priority and Procedure in Enforcement by Realisation of Security

Legal Article · 12 November 2026
Av. Thomas Andreas Di Constantinople

Realisation of security aims to satisfy a secured claim primarily from the value of the pledged or mortgaged property. The principle of first resort to security in Article 45 of the Enforcement and Bankruptcy Law and its exceptions are fundamental to selecting the enforcement route. Not every secured claim follows the same procedure.

Realisation of movable pledges and mortgages is subject to different enforcement provisions. The nature of the supporting document may also affect whether judgment-based or non-judgment procedures apply. The mortgage instrument's content, secured debt, and maturity must be examined as separate issues.

The security provider and personal debtor are not always the same person. Where security is established over a third party's property, the owner's position in enforcement and required notifications are particularly important. Personal liability must not be confused with liability limited to the value of the secured property.

Insufficient sale proceeds may raise questions concerning deficiency documents and remedies available for the outstanding claim. However, a provisional shortfall before sale and a definitive shortfall after sale are different legal situations. The creditor must take collections in multiple files into account together.

For example, the registered amount of a maximum-amount mortgage does not alone prove that the actual debt equals that amount. The scope of security, accrued claim, and interest items must be assessed separately. The existence of security does not automatically remove defences concerning sale conditions, service, or extinguishment of the debt; each allegation must be examined under the relevant special remedy framework.

This article has been prepared for general legal information purposes.