REAL AND PERSONAL SECURITY The mortgagee may also take control of the mortgaged property, provided this is expressly stipulated and required in view of the execution The Civil Code contains an elaborate provision on the right of the moN,the and the buyer at an execution sale to annul certa in lease contracts relating to mortgaged property. ]This can be done only if the-notarial and registered-deed of mortgage explicitly stipulates that the mortga gor should be limited in his power to give the encum bered property in lease, although even then notable exceptions exist This provision can be understood only aga inst the background of the rule that lessees cannot be evicted if, after the lease, the leased property is being transferred or burdened with a lim ited real right, such as a mortgage. 33 In the case of a mortgage certain lessees are even protected if the lease dates from after the right of mortgage was established, even if an express stipulation was made that the mortgagor is not allowed to lease the burdened property. The protection of the lessees means that,e.g. the new owner is considered to be the new lessor The proceeds of the sale in execution must be paid to the notary. The notary is allowed to pay the creditors if there is no doubt how to divide the proceeds. If there is any doubt the notary will have to pay the net proceeds to a custodian. The interested parties may request a judicial ranking: the court will then decide how the proceed should be divided. As a result of the delivery pursuant to a forced sale and the payment of the purchase price by the buyer at the auction, all mortgages encumbering the property, all registered seizures and all limited real rights which cannot be invoked against the mortgagee are extinguished. The buyer can ask the President of the District Court for a declration that the sale took place as required by been paid to the notary entered in the public land register and it authorises the registrar to cancel the entries regarding mortgages and seizures. Retention of ownership('eigendomsvoorbehoud)4 Dutch aw regards the retention of ownership clause as a condition incorporated into the legalact of transfer. Unless the parties agreed otherwise the law will assume that they opted for a suspensive condition postponing the transfer of ownership until the condition of payment has been met (art. 3: 92 lid 1 CC). However, the parties may opt for a resolutive condition: here ownership, which initially passed, will revert upon The relevant article(3264 CC) takes about a whole page n prnt. We refer to the text as translated by Haanappel and Mackaay for further details. As to argicultural leases(pacht)see also art. 34 Pachhvet The prnciple that a sale will not break a lease(koop breekt geen huur)s lai down n art. 7A: 1612 CC(the provision of the old CC. whchstill applies) and the articls 7: 226 en 7: 227 new CC. which will enter nto force in the near future. The new articles 7-226 and 7- 227 have led to considerable academic debate. Seeeg M.M. van Asbreuk-van O, Deregel koop breck geen huur wetsvoorstel 26089 vertoont( verborgen)gebreken, WPNR 6386(2000);R Westrik, Koop breekt geen huur' en het huurbeding, Koninklijke Vemande, The Hague 2001),pp. 179ff See Reehus et al, Goederenrecht ch. 15, Minssen/an Velten, Zakenrecht Zekerheden, chREAL AND PERSONAL SECURITY 7 The mortgagee may also take control of the mortgaged property, provided this is expressly stipulated and required in view of the execution. The Civil Code contains an elaborate provision on the right of the mortgagee and the buyer at an execution sale to annul certain lease contracts relating to the mortgaged property.32 This can be done only if the - notarial and registered - deed of mortgage explicitly stipulates that the mortgagor should be limited in his power to give the encumbered property in lease, although even then notable exceptions exist. This provision can be understood only against the background of the rule that lessees cannot be evicted if, after the lease, the leased property is being transferred or burdened with a limited real right, such as a mortgage.33 In the case of a mortgage certain lessees are even protected if the lease dates from after the right of mortgage was established, even if an express stipulation was made that the mortgagor is not allowed to lease the burdened property. The protection of the lessees means that, e.g., the new owner is considered to be the new lessor. The proceeds of the sale in execution must be paid to the notary. The notary is allowed to pay the creditors if there is no doubt how to divide the proceeds. If there is any doubt the notary will have to pay the net proceeds to a custodian. The interested parties may request a judicial ranking: the court will then decide how the proceeds should be divided. As a result of the delivery pursuant to a forced sale and the payment of the purchase price by the buyer at the auction, all mortgages encumbering the property, all registered seizures and all limited real rights which cannot be invoked against the mortgagee are extinguished. The buyer can ask the President of the District Court for a declaration that the sale took place as required by law and that the purchase price has been paid to the notary. This declaration can be entered in the public land register and it authorises the registrar to cancel the entries regarding mortgages and seizures. 3 Retention of ownership (‘eigendomsvoorbehoud’)34 Dutch law regards the retention of ownership clause as a condition incorporated into the legal act of transfer. Unless the parties agreed otherwise the law will assume that they opted for a suspensive condition postponing the transfer of ownership until the condition of payment has been met (art. 3:92 lid 1 CC). However, the parties may opt for a resolutive condition: here ownership, which initially passed, will revert upon 32. The relevant article (3:264 C.C.) takes about a whole page in print. We refer to the text as translated by Haanappel and Mackaay for further details. As to argricultural leases (‘pacht’) see also art. 34 Pachtwet. 33. The principle that a sale will not break a lease (‘koop breekt geen huur’) is laid down in art. 7A:1612 CC (the provision of the old C.C. which still applies) and the articles 7:226 en 7:227 new C.C., which will enter into force in the near future. The new articles 7:226 and 7:227 have led to considerable academic debate. See e.g. M.M. van Asbreuk-van Os, De regel ‘koop breekt geen huur’ in wetsvoorstel 26089 vertoont (verborgen) gebreken, WPNR 6386 (2000); R. Westrik, Koop breekt geen huur’ en het huurbeding, Koninklijke Vermande, The Hague 2001), pp. 179 ff. 34. See Reehuis et al., Goederenrecht, ch. 15; Mijnssen/Van Velten, Zakenrecht, Zekerheden, ch. 7