Article 320. Selling Pledged Property in a Compulsory Non-Judicial Procedure

1. When selling pledged property in a compulsory non-judicial procedure, the auction shall be carried out by the nominated person, who may be a legal entity or a citizen who has the power of attorney from the pledge holder, to sell the pledged property in the case of violation of the obligation secured with the pledge.

2. The nominated person shall carry out the following procedure:

1) compile notification to the pledger of the non-execution of the obligations and register it at the body where the pledge agreement was registered;

2) in the case where the claims which ensue from the notice are not satisfied, but not earlier than two months after the moment of its dispatch to the pledger, compile the notice of auction of the pledged property, register it with the body where the pledge agreement was registered, and hand it to pledger;

3) officially publish the announcement of the auction in the local press.

Article 321. Premature Execution of an Obligation Which is Secured with the Pledge and the Imposition of a Claim Upon the Pledged Property

1. A pledge holder shall have the right to claim a premature execution of obligations secured with pledge in the following cases:

1) when the pledged item went out of possession of the pledger with whom it was left not in accordance with the provisions of the pledge agreement;

2) violation by the pledger of the rules for the replacement of pledged property (Article 314 of this Code);

3) the loss of the pledged item under the circumstances for which the pledge holder is not responsible (paragraph 2 of Article 313 of this Code), unless the pledger exercises the right stipulated in paragraph 2 of Article 314 of this Code.

2. A pledge holder shall have the right to claim a premature execution of the obligation secured with pledge, and if his claim is not satisfied, to impose the claim upon the pledged item in the following cases:

1) violation by the pledger of the rules concerning subsequent pledge;

2) non-execution by the pledger of the obligations stipulated in sub-paragraphs 1 and 2 of paragraph 1 and paragraph 2 of Article 312 of this Code;

3) violation by the pledger of the rules for disposal of pledged property (paragraph 2 of Article 315 of this Code).

Article 322. Cessation of Pledge

1. Pledge shall cease as follows:

1) with the cessation of the obligation secured with pledge;

2) upon the claim of the pledger, where the bases exist which are stipulated in paragraph 3 of Article 312 of this Code;

3) in the case of destruction of a pledged item or cessation of the pledged right, unless the pledger failed to exercise the right stipulated in paragraph 2 of Article 314 of this Code;

4) in the case of selling pledged property through a public auction and also in the event that its sale turned out to be impossible (Article 319 of this Code).

2. An note must be made on the cessation of pledge in the register in which the pledge agreement was registered.

3. In cessation of pledge as a result of the execution of the obligation secured with the pledge, or by demand of the pledger (paragraph 3 of Article 312 of this Code), the pledge holder who holds pledged property shall be obliged to immediately return it to the pledger.