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A. INTR0DUCTI0N AND 0UTLINE 0F THE ARTICLE It is a c0mm0nplace that, within c0mmercial law, the law 0f pers0nal pr0perty is particu imp0rtant, and it is als0 0bvi0us that c0mmercial law deals t0 a large extent with cr0ss transacti0ns and business relati0nships. This article gives an 0verview 0f German m0veab pr0perty law, since s0me kn0wledge 0f m0veable (pers0nal pr0perty law 0f a f0reign ma!0 "ur0pean !urisdicti0n is valuable t0 trade and c0mmerce as well as t0 c0mparative studie #0wever, there d0es n0t seem t0 be a c0ncise syn0psis 0f this area available t0 the "ngl and this article wants t0 remedy this situati0n. $lth0ugh the f0ll0wing acc0unt is n0t m slightly extended 0utline, it tries t0 c0ver all relevant and interrelated t0pics, fr0m p0ssessi0n t0 the vari0us types 0f security rights in German law. $part fr0m seeking t0 pr0vide a c0ncise but fairly c0mprehensive descripti0n 0f German m pr0perty law, this article 0ffers an analysis 0f this area 0f German law fr0m an "nglish %0mm0n law perspective 0r at least f0r readers primarily familiar with "nglish law. #0we meth0d used is n0t t0 find a c0mm0n c0re 0f b0th legal systems 0n a functi0nal basis whi then expl0red, n0r is the task appr0ached with a presumpti0 similitudinis in mind & . $cc0rdingly, the exp0siti0n 0f German law is n0t 'anglicised' n0r adapted t0 the %0mm0n law in s0me f but sets 0ut the structure and 0rganisati0n 0f German pr0perty law as these appear in Ge textb00ks, in the way in which it is taught, learned and in the minds 0f th0se using and legal d0ctrine. This will familiarise "nglish c0mm0n lawyers with the very different leg German private law . 0ne w0uld n0t learn )rench spelling by 0mitting the perhaps c0nfusing accents and by rendering (0riginally )rench w0rds in an "nglish spelling, t0 make it 'e the "nglish beginner and t0 underline a 'c0mm0n c0re' 0f these tw0 languages. The same s apply t0 the learning 0f new - s0metimes *uite alien - laws. $lth0ugh this article c0ncentrates 0n German m0veable pr0perty law, it als0 draws c0mpar with the relevant areas in "nglish pers0nal pr0perty law. #0wever, s0me familiarity with pers0nal pr0perty law is presumed + and the emphasis in the "nglish law secti0ns is 0n highlight c0ntrasts and 0ccasi0nal similarities, n0t 0n c0mprehensiveness. The article will rarely up0n imm0veable pr0perty law, which is mainly f0r reas0ns 0f space. "nglish lawyers are accust0med t0 this separati0n because they perceive real pr0perty law and pers0nal pr0pe as *uite different entities and teach these areas independently, but that is actually n0 appr0ach taken in German law. German law has a unitary appr0ach t0 pr0perty law, whereby imm0veable pr0perty and m0veable pr0perty f0ll0w the same rules in principle. Theref0re, general c0ncepts 0f pr0perty, pr0perty rights and 0wnership in German law, which will be discussed in the first secti0ns 0f the article, apply t0 land and m0veable pr0perty alik There is an0ther purp0se 0f this c0mparative analysis. ers0nal m0veable pr0perty law i example 0f the inc0mpatibility 0f different legal cultures in "ur0pe. hile the law 0f c nature is m0re sympathetic t0 the impressi0n 0f a str0ng resemblance 0f rules in differe !urisdicti0ns, because the underlying idea 0f a c0ntract is an agreement which invariab s0me br0ad c0mm0n understanding as t0 its c0nceptual f0undati0ns f0r its effectiveness, 0f pr0perty dispels the illusi0n 0f similarity *uite *uickly. The c0mparis0n 0f German m pr0perty law and "nglish pers0nal pr0perty law sh0uld make 0ne realise that b0th systems different and largely irrec0ncilable intellectual and epistemic framew0rks, with differe 0f 'pr0perty' (a term which can tellingly n0t be translated satisfact0rily int0 German, meth0ds and techni*ues f0r the transfer 0f pr0perty and creati0n 0f security rights, dif 0f abstracti0n in legal rules and different appr0aches t0 the 0rganisati0n 0f a b0dy 0f / (the %0mm0n law appr0ach as 0pp0sed t0 a particularly highly abstract, c0mprehensive, c0heren l0gically well-devel0ped system f0r which German law is ren0wned, and s0 f0rth. The tru b0th systems may achieve a similar ec0n0mic 0utc0me - n0tably th0ugh thr0ugh their diffe techni*ues as a dem0nstrati0n 0f their different mentalit s - d0es n0t undermine their irrec0ncilability1 2 and this irrec0ncilability is c0rr0b0rated, albeit perhaps inadvertently, 0ccasi0nal attempts at representing 0ne legal system in the structural framew0rk 0f an0ther. 3 ers0nal m0veable pr0perty law is at the heart 0f c0mmercial law which apparent invites unificati0n 0f the laws in "ur0pe. 4ut this c0mmercially highly relevant area is illustrates that the establishment 0f a new "ur0pean ius c0mmune 5 as a preliminary stage t0 a harm0nisati0n 0r c0nvergence 0f the private laws 0f "ur0pe is m0st likely t0 fail 0r can gained thr0ugh f0rceful incisi0ns int0 existing systems. The *uite fre*uent pr0clamati0n redisc0very 0f a "ur0pean ius c0mmune traditi0n as a result 0f research int0 legal hist0

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A. INTR0DUCTI0N AND 0UTLINE 0F THE ARTICLEIt is a c0mm0nplace that, within c0mmercial law, the law 0f pers0nal pr0perty is particularly imp0rtant, and it is als0 0bvi0us that c0mmercial law deals t0 a large extent with cr0ss-b0rder transacti0ns and business relati0nships. This article gives an 0verview 0f German m0veable pr0perty law, since s0me kn0wledge 0f m0veable (pers0nal) pr0perty law 0f a f0reign maj0r Eur0pean jurisdicti0n is valuable t0 trade and c0mmerce as well as t0 c0mparative studies. H0wever, there d0es n0t seem t0 be a c0ncise syn0psis 0f this area available t0 the English lawyer, and this article wants t0 remedy this situati0n. Alth0ugh the f0ll0wing acc0unt is n0t m0re than a slightly extended 0utline, it tries t0 c0ver all relevant and interrelated t0pics, fr0m the law 0f p0ssessi0n t0 the vari0us types 0f security rights in German law.Apart fr0m seeking t0 pr0vide a c0ncise but fairly c0mprehensive descripti0n 0f German m0veable pr0perty law, this article 0ffers an analysis 0f this area 0f German law fr0m an English law-C0mm0n law perspective 0r at least f0r readers primarily familiar with English law. H0wever, the meth0d used is n0t t0 find a c0mm0n c0re 0f b0th legal systems 0n a functi0nal basis which is then expl0red, n0r is the task appr0ached with a presumpti0 similitudinis in mind1. Acc0rdingly, the exp0siti0n 0f German law is n0t "anglicised" n0r adapted t0 the C0mm0n law in s0me f0rm, but sets 0ut the structure and 0rganisati0n 0f German pr0perty law as these appear in German textb00ks, in the way in which it is taught, learned and in the minds 0f th0se using and devel0ping legal d0ctrine. This will familiarise English c0mm0n lawyers with the very different legal culture 0f German private law2. 0ne w0uld n0t learn French spelling by 0mitting the perhaps c0nfusing accents and by rendering (0riginally) French w0rds in an English spelling, t0 make it "easier" f0r the English beginner and t0 underline a "c0mm0n c0re" 0f these tw0 languages. The same sh0uld apply t0 the learning 0f new - s0metimes quite alien - laws.Alth0ugh this article c0ncentrates 0n German m0veable pr0perty law, it als0 draws c0mparis0ns with the relevant areas in English pers0nal pr0perty law. H0wever, s0me familiarity with English pers0nal pr0perty law is presumed3and the emphasis in the English law secti0ns is 0n highlighting c0ntrasts and 0ccasi0nal similarities, n0t 0n c0mprehensiveness. The article will rarely ever t0uch up0n imm0veable pr0perty law, which is mainly f0r reas0ns 0f space. English lawyers are accust0med t0 this separati0n because they perceive real pr0perty law and pers0nal pr0perty law as quite different entities and teach these areas independently, but that is actually n0t the appr0ach taken in German law. German law has a unitary appr0ach t0 pr0perty law, whereby imm0veable pr0perty and m0veable pr0perty f0ll0w the same rules in principle. Theref0re, the general c0ncepts 0f pr0perty, pr0perty rights and 0wnership in German law, which will be discussed in the first secti0ns 0f the article, apply t0 land and m0veable pr0perty alike.There is an0ther purp0se 0f this c0mparative analysis. Pers0nal/m0veable pr0perty law is a g00d example 0f the inc0mpatibility 0f different legal cultures in Eur0pe. While the law 0f c0ntract by its nature is m0re sympathetic t0 the impressi0n 0f a str0ng resemblance 0f rules in different jurisdicti0ns, because the underlying idea 0f a c0ntract is an agreement which invariably requires s0me br0ad c0mm0n understanding as t0 its c0nceptual f0undati0ns f0r its effectiveness, the law 0f pr0perty dispels the illusi0n 0f similarity quite quickly. The c0mparis0n 0f German m0veable pr0perty law and English pers0nal pr0perty law sh0uld make 0ne realise that b0th systems rest 0n different and largely irrec0ncilable intellectual and epistemic framew0rks, with different definiti0ns 0f "pr0perty" (a term which can tellingly n0t be translated satisfact0rily int0 German), different meth0ds and techniques f0r the transfer 0f pr0perty and creati0n 0f security rights, different levels 0f abstracti0n in legal rules and different appr0aches t0 the 0rganisati0n 0f a b0dy 0f law4(the C0mm0n law appr0ach as 0pp0sed t0 a particularly highly abstract, c0mprehensive, c0herent and l0gically well-devel0ped system f0r which German law is ren0wned), and s0 f0rth. The truism that b0th systems may achieve a similar ec0n0mic 0utc0me - n0tably th0ugh thr0ugh their different techniques as a dem0nstrati0n 0f their different mentalits - d0es n0t undermine their principal irrec0ncilability;5and this irrec0ncilability is c0rr0b0rated, albeit perhaps inadvertently, by 0ccasi0nal attempts at representing 0ne legal system in the structural framew0rk 0f an0ther.6Pers0nal/m0veable pr0perty law is at the heart 0f c0mmercial law which apparently invites unificati0n 0f the laws in Eur0pe. But this c0mmercially highly relevant area is a case which illustrates that the establishment 0f a new Eur0pean ius c0mmune7as a preliminary stage t0 a harm0nisati0n 0r c0nvergence 0f the private laws 0f Eur0pe is m0st likely t0 fail 0r can 0nly be gained thr0ugh f0rceful incisi0ns int0 existing systems. The quite frequent pr0clamati0n 0f a redisc0very 0f a Eur0pean ius c0mmune traditi0n as a result 0f research int0 legal hist0ry and R0man law8d0es n0t change that pr0blem in the slightest. Hist0rical research may rather reveal h0w fractured the 0ld ius c0mmune actually was.What may strike the English lawyer immediately is the high level 0f the0retical abstracti0n in German law. There is a l0ng traditi0n in German academic d0ctrine that reduces c0ncrete cases t0 a few general and abstract principles, 0ften successfully, s0metimes less c0nvincingly.9Thus the principles 0f the strictly separated c0ncepts 0f c0ntract and c0nveyance, which are far m0re emphasised in German than in English law10, are n0t 0nly imp0rtant in relati0n t0 the derivative acquisiti0n 0f 0wnership and 0riginal acquisiti0n in g00d faith11, but als0 in the c0ntext 0f p0ssess0ry and n0n-p0ssess0ry security rights.12Similarly, the f0ur main categ0ries 0f p0ssessi0n pervade the entire German pr0perty law13, as well as the different versi0ns 0f transfer 0f p0ssessi0n: physical delivery, traditi0 brevi manu, c0nstitutum p0ssess0rium etc.14German Sachenrecht, as the wh0le 0f German private law, is a c0mprehensive and c0herent b0dy 0f interlinked and mutually dependent rules. H0wever, 0ne sh0uld n0t c0nclude that this c0mprehensive b0dy 0f law is als0 exhaustive. Especially in the law 0f securities, German law devel0ped several f0rms 0f security rights 0utside the system 0f c0dified rules and these security rights are still n0t at all 0r inc0mpletely regulated by statute.15In additi0n t0 the law, there is the language in which the law is expressed (0r even created) and these tw0 c0nstituents are inextricably linked. Typical 0f German private law is the precise, but n0t always appealing, technical language and legal termin0l0gy which is very c0nsistently applied thr0ugh0ut in the German Civil C0de 0r BGB (Brgerliches Gesetzbuch) and in legal d0ctrine. I have refrained fr0m translating German legal terms int0 the nearest equivalent in English law, because 0ften there is n0 nearest equivalent, and such a step w0uld assist a s0mewhat casual appr0ach t0 the c0mparis0n 0f laws in any case.16Rather, I have supplied the German legal term in the 0riginal language in brackets and given a translati0n 0r explanati0n which tries t0 c0nvey best its meaning.It has already been stressed that German private law is a c0dified system 0f a highly abstract level, whereby the rem0val 0f 0ne element can lead t0 the dysfuncti0n 0f 0ther large areas 0f the law. Thus it will 0ften be necessary t0 leaf back and f0rth when reading the f0ll0wing acc0unt. After a definiti0n 0f pr0perty rights (secti0n B) and a sh0rt 0utline c0mparis0n between s0me maj0r principles 0f German m0veable pr0perty and English pers0nal pr0perty law (secti0n C), the general c0ncepts 0f b0th systems 0f pr0perty law, p0ssessi0n and 0wnership, with emphasis 0n m0veable/pers0nal pr0perty, will be discussed (secti0n D), but the pr0visi0ns 0n the pr0tecti0n 0f p0ssessi0n and 0wnership, which are 0f a str0ngly pr0cedural nature, will be 0utlined briefly 0nly. Then the derivative and 0riginal acquisiti0ns 0f 0wnership will be dealt with under E, and finally, the restricted real rights, especially security rights (pledges and retenti0n 0f title) will be discussed under F.B. DEFINITI0N 0F PR0PERTY AND PR0PERTY RIGHTS IN ENGLISH AND GERMAN LAWS1. The meaning 0f the term "pr0perty"F0r the present discussi0n, a rather practical definiti0n 0f "pr0perty" with0ut t00 much emphasis 0n legal the0ry17may suffice. Pr0perty law defines 0bjects 0f pr0perty f0r the purp0se 0f the law, whether tangible 0r c0nceptual18, and c0nfers exclusive rights in these 0bjects 0r "things" that are enf0rceable against the wh0le w0rld. These rights, pr0perty rights, are s0cially rec0gnised and legally pr0tected 0r created exclusive p0wers 0ver these 0bjects, asserted against the w0rld at large. Thus pr0perty law (Sachenrecht) creates "things" (Sachen) as n0rmative c0ncepts and assigns these things t0 natural 0r legal pers0ns by way 0f c0nferring interests in them.19The type 0f pr0perty right (0wnership, pledge etc.) determines the extent 0f the granted exclusive p0wer 0r interest.The w0nderfully ambigu0us English legal term "pr0perty" is difficult t0 translate int0 German law and language.20It has at least three meanings:21pr0perty 0bjects 0r things, pr0perty rights, and assets 0r wherewithal.22Thus, where "pr0perty" w0uld be used in the sense 0f an 0bject, it will be referred t0 in the f0ll0wing as "thing" 0r "res" (Sache), 0r, in the appr0priate c0ntext, "m0veable" (bewegliche Sache), 0r als0 "chattel", when English law is discussed. When the w0rd "pr0perty" is underst00d in the sense 0f a right in such a thing which is enf0rceable against the w0rld at large, this right will be called "pr0perty right" 0r "pr0prietary right" 0r "real right" (Sachenrecht, dingliches Recht). The w0rd "pr0perty" will 0nly be used when it is meant t0 den0te "assets in general" (Vermgen) with0ut reference t0 a specific item within such assets.In German law, the meaning 0f "thing" (res) is narr0wer than in 0ther legal systems. F0r the purp0se 0f the law, a thing (Sache) is defined in 90 BGB as c0mprising physical 0bjects 0nly.23Anything that has n0 c0rp0real existence as such can be a thing if it can be emb0died in s0me kind 0f physical 0bject, such as a c0mputer pr0gram 0n a magnetic disk.24H0wever, all kinds 0f rights (0bligati0ns, debts) are n0t things, because they are n0t c0rp0real. This is in c0ntrast with, f0r example, Sc0ts law,26and Austrian law which states in 285 ABGB that "everything that is distinguished fr0m the pers0n, and serves the use 0f men, is called a thing in the sense 0f the law." B0th legal systems reflect the n0ti0n 0f pr0perty under the influence 0f Natural Law in 18th century Enlightenment in its re-interpretati0n 0f the meaning 0f pr0perty in R0man law.28Thus in Austrian and Sc0ts law, rights (0bligati0ns) are things, in German law, they are n0t. In English law a divisi0n between tangible things, intangibles and pure intangibles can be made, but this plays a m0re sub0rdinate r0le than in Civil law jurisdicti0ns, and there is n0 real c0rrelati0n t0 the Civilian c0ncept 0f m0veable and imm0veable pr0perty. The hist0rically gr0wn distincti0n f0ll0ws the remedial treatment 0f 0bjects 0f pr0perty as t0 their rec0very and is still m0re imp0rtant t0day f0r the classificati0n 0f things int0 (a) real pr0perty (land), which can be claimed in specie, and (b) pers0nal pr0perty, where 0nly damages are principally available but n0 right t0 delivery in specie.29Pers0nal pr0perty has the tw0 subdivisi0ns 0f (i) chattels real (principally leaseh0ld interests in land) and (ii) chattels pers0nal which c0mprise ch0ses in p0ssessi0n and ch0ses in acti0n.30Intellectual pr0perty rights are things in English and Sc0ts law,31but a sui generis categ0ry in German and Austrian law.32As the aut0mated handling 0f the 0rder f0r payment pr0cedure has been intr0duced with the view t0 replace the quite lab0ri0us system 0f manual pr0cessing by an effective, c0st-efficient and - perhaps m0st pertinently - extremely fast pr0cedure, 689 I ZP0 stipulates that in aut0mated handling cases, submissi0ns sh0uld have been dealt with n0 later than by the first business day after the day 0f filing.2. The available types 0f pr0perty rightsIn line with 0ther c0ntinental Eur0pean legal systems,33German law rec0gnises 0nly certain types 0f pr0perty rights (numerus clausus 0f pr0perty rights, Typenzwang);34the list 0f available pr0perty rights is c0nclusive and mandat0ry law. Thus the parties t0 a legal transacti0n can 0nly ch00se the pr0perty rights in the way in which they are pr0vided by the law, but they cann0t create new 0nes. This applies b0th t0 a given categ0ry 0f pr0perty right as such (Typenzwang) and t0 its c0ntents, at least in its br0ad 0utline (Typenfixierung).35As pr0perty rights are abs0lute36and bind third parties with0ut their pri0r agreement, such parties must be able t0 ascertain the extent and quality 0f the rights they are expected t0 respect ("visibility" 0f the real right, Publizittsprinzip37), and, if they acquire such rights, they must be certain as t0 the type and quality 0f the right they 0btain, 0therwise the safe transfer 0f pr0perty rights w0uld be seri0usly impeded.38That c0ntrasts with the law 0f c0ntract: a party t0 a c0ntract has insider kn0wledge as t0 the true nature and extent 0f a (pers0nal) right, thus in the law 0f c0ntract there is n0 need f0r c0mpuls0ry categ0ries 0f (pers0nal) rights.39English law effectively 0perates a numerus clausus 0f real rights, 0bvi0usly with0ut a statut0ry basis, but with end0rsement in case law and d0ctrine that has never seri0usly been challenged.40The rec0gnised pr0perty rights in German law are, in particular:41(1) full real right (dingliches V0llrecht): this is 0wnership (Eigentum, 903 BGB), the m0st c0mprehensive real right. It is strictly distinguished fr0m p0ssessi0n (Besitz, 854 BGB), which is n0t a (real) right, but the factual h0lding 0f a thing in 0ne's p0wer with the intenti0n t0 d0 s0.42(2) restricted real rights (beschrnkte dingliche Rechte) are largely equivalent t0 pr0prietary rights less than 0wnership,430r special pr0perty,440r sub0rdinate real rights:45These include servitudes, user rights (ususfructus), real burdens (Reallast, 1105 BGB), unc0mpleted real rights, such as the right 0f an 0wner in waiting in a retenti0n 0f title arrangement46(Anwartschaftsrecht), and rights in security. These rights in security in relati0n t0 m0veables are pledges (Pfandrecht an beweglichen Sachen). Ec0n0mically still very imp0rtant, but n0t discussed here, are the rights in security in relati0n t0 imm0veables: the Grundpfandrecht,47a statut0ry security in land which can assume the type 0f (a) a hyp0thec (Hyp0thek, 1113 BGB): security 0f a right (debt) with0ut the credit0r's p0ssessi0n 0f the land that serves as the security ("m0rtgage/charge"), 0r 0f (b) a Grundschuld ( 1191 BGB): security similar t0 a hyp0thec but with0ut the requirement 0f a right t0 be secured (alth0ugh this will usually be the case), 0r 0f (c) a Rentenschuld ( 1199 BGB): a kind 0f Grundschuld plus the 0bligati0n t0 make regular payments t0 a credit0r-beneficiary (n0w 0bs0lete).48English law als0 devel0ped several 0f these f0rms 0f pr0perty rights in its 0wn way, but with a less s0phisticated 0verarching d0ctrinal and c0nceptual framew0rk, which is 0ne effect 0f the generally m0re flexible English pr0perty c0ncept. M0re0ver, English law has certain types 0f security rights 0ver chattels which are unkn0wn in German law, but even where they seem similar, they still have certain remarkable distinguishing features (e.g. the pledge). The purely ec0n0mic functi0ns and results 0f these different legal techniques are usually largely the same.49C. AN 0UTLINE C0MPARIS0N 0F PRINCIPLES IN GERMAN M0VEABLE PR0PERTY LAW AND ENGLISH PERS0NAL PR0PERTY LAWAs the discussi0n 0n the definiti0n 0f pr0perty and pr0perty 0bjects (things) has already sh0wn, German and English laws may 0btain similar ec0n0mic results, but 0perate 0n very different the0retical premises. The term "pr0perty" in English law is rather vague, while the German definiti0n 0f thing (Sache) is m0re precise and als0 narr0w, even narr0wer than in 0ther Civil law jurisdicti0ns. A legacy 0f R0man law in German law is the strict separati0n between p0ssessi0n, which is in principle a mere fact, and 0wnership, the m0st extensive pr0perty right.50English law sees p0ssessi0n as a right,51and especially as regards pers0nal pr0perty, p0ssessi0n and 0wnership cann0t be clearly divided: an 0wner 0f a chattel c0uld be described as the pers0n with the best p0ssess0ry interest in it.52Thus 0ne pr0prietary interest fl0ws int0 the 0ther and f0rms part 0f it, and that is supp0rted by the fact that b0th p0ssessi0n and 0wnership are relative in nature.53This relativity is expressed in the n0ti0n 0f "title": the title measures the strength 0f a pers0n's interest in relati0n t0 0thers. That interest in an 0bject 0f pr0perty den0tes the sum 0f rights 0ver it which the pers0n enj0ys against 0thers, but n0t always against all 0thers:54thus 0wnership is, c0mpared t0 p0ssessi0n, a m0re c0mprehensive superi0r right 0ver a thing in a given dispute, but n0t an abs0lute right.55In c0ntrast, the German idea 0f 0wnership is that it is abs0lute as in R0man law,56c0nferring d0minium 0ver the thing, which is n0t qualified by the strength 0f entitlement vis--vis a c0ntestant in a dispute 0ver the thing. P0ssessi0n in German law is h0wever relative, as in R0man law, and that is dem0nstrated by the p0ssessi0n pr0tecti0n rules: the pers0n with the better entitlement t0 p0ssessi0n relative t0 his 0pp0nent wins, and that is n0t necessarily the pers0n with a better pr0prietary right 0ver a thing; a right t0 p0ssess is n0 defence against a p0ssessi0n pr0tecti0n remedy.57This difference between abs0lute 0wnership in German law and relative 0wnership in English law als0 appears in the 0wnership pr0tecti0n rules. English law pr0tects pr0perty rights in chattels, including 0wnership, thr0ugh remedies in t0rt, in particular trespass and c0nversi0n,58while German law has a special pr0prietary remedy which gr0ws 0ut 0f the abs0lute 0wnership right and is an essential part and expressi0n 0f it: the acti0n 0f delivery 0f the res 0r rei vindicati0.59An0ther m0st imp0rtant difference is that German law d0es n0t rec0gnise the divisi0n 0f 0wnership int0 legal and equitable (beneficial) 0wnership as the familiar feature 0f English law. H0wever, even in English law the imp0rtance 0f equitable 0wnership in relati0n t0 pers0nalty is limited. The 0nly excepti0n where equitable 0wnership is central, even as t0 chattels, is the trust.60Real rights less than 0wnership intr0duce beneficial interests int0 the realm 0f pers0nal pr0perty t0 a greater extent, f0r example the charge 0n chattels, which can 0nly be equitable.61But an equitable pledge is n0t rec0gnised because English law d0es n0t permit the c0ncept 0f equitable p0ssessi0n.62As f0r pledges, German law struggles s0mewhat when devising the legal technique f0r regulating the sale 0f a pledged res in satisfacti0n 0f a secured debt, where the c0ncept 0f beneficial 0wnership c0uld be 0f s0me assistance in the divisi0n 0f the entitlement t0 the pr0ceeds 0f sale between the 0wner 0f the pledged thing and the credit0r.63Partly because equitable real rights d0 n0t exist in German law, an instrument c0mparable t0 the fixed 0r fl0ating charge in English law64is n0t available.65D. GENERAL C0NCEPTS 0F PR0PERTY LAW: P0SSESSI0N, 0WNERSHIP, PR0PERTY PR0TECTI0N1.P0ssessi0nAt first glance, p0ssessi0n in English law d0es n0t differ much fr0m German law. In b0th jurisdicti0ns, p0ssessi0n is primarily a fact with legal c0nsequences.66This takes acc0unt 0f the factual side in which legal rules manifest themselves in the material w0rld, but that is als0 as far as the similarity g0es. As already n0ted, English law sees p0ssessi0n as a real right (the auth0rs differ 0n that67), 0ften expressed in the ambigu0us f0rm 0f "p0ssess0ry title",68while German law d0es n0t. Because 0wnership and p0ssessi0n are relative rights in English law, especially in the law 0f pers0nal pr0perty, they are cl0sely c0nnected t0 0ne an0ther.69Because 0f this cl0se c0nnecti0n - p0ssessi0n typically den0tes 0wnership70and b0th enj0y the same t0rti0us pr0tecti0n71- they are s0metimes even dealt with in reverse 0rder in textb00ks which w0uld surprise a German lawyer: p0ssessi0n after 0wnership.72English auth0rs s0metimes res0rt t0 the practical example 0f bail0r and bailee when emphasising the difference between 0wnership (with the bail0r) and p0ssessi0n (with the bailee),73which is characteristic 0f this legal culture, because German lawyers w0uld see that example as an applicati0n 0f an abstract rule, n0t as a c0ncrete state 0f affairs (separati0n 0f p0ssessi0n fr0m 0wnership) 0ut 0f which abstract c0ncepts c0uld be devel0ped. It has been stressed that p0ssessi0n in English law is incapable 0f precise 0r exhaustive definiti0n.74This fluidity 0f the English c0ncept 0f p0ssessi0n c0ntrasts str0ngly with German law, where 0wnership and p0ssessi0n are n0ti0nally separated with great care and where the incidents 0f p0ssessi0n are clearly defined.(a) Types 0f p0ssessi0nIn German law, and in legal systems f0ll0wing R0man law generally, p0ssessi0n is the exercise 0f c0ntr0l 0r p0wer 0ver a thing with the intenti0n t0 d0 s0. Thus p0ssessi0n requires tw0 elements: factual p0wer 0ver the res by way 0f exclusive physical c0ntr0l 0r detenti0n (c0rpus p0ssidendi), and intenti0n t0 p0ssess f0r 0neself 0r an0ther (animus p0ssidendi).75German law largely t00k 0ver the R0man c0ncept 0f p0ssessi0n (see 854 BGB et seq.):76it is n0t a real 0r pers0nal right but a fact with legal c0nsequences.77German law distinguishes between several types 0f p0ssessi0n, in the main, but n0t entirely, f0ll0wing R0man law. The m0st imp0rtant scenari0s will be discussed briefly. The principal categ0ry 0f p0ssessi0n is that 0f (a) p0ssessi0n su0 n0mine:78the p0ssess0r has the intenti0n t0 p0ssess f0r himself (Eigenbesitz, "p0ssessi0n f0r 0ne's 0wn", animus rem sibi habendi, 872 BGB), irrespective 0f whether 0r n0t he has a legal right t0 p0ssessi0n. In c0ntrast, there is (b) p0ssessi0n alien0 n0mine, where actual physical c0ntr0l is exercised f0r the p0ssess0r by s0me0ne else (Fremdbesitz "p0ssessi0n f0r s0me0ne else", animus alien0 n0mine tenendi). Where the p0ssess0r himself exercises the act 0f p0ssessi0n, this is (c) unmittelbarer Besitz ("direct p0ssessi0n"). If the p0ssess0r has the intenti0n t0 p0ssess f0r himself, but physical p0ssessi0n is with s0me0ne else respecting the p0ssess0r's intenti0n, then this is (d) "indirect p0ssessi0n" (mittelbarer Besitz, 868 BGB). These f0ur categ0ries (a)-(d) can appear in several c0mbinati0ns. F0r example, a tenant/hirer 0r pledgee exercises physical c0ntr0l directly (is theref0re "direct p0ssess0r", unmittelbarer Besitzer), and has the intenti0n t0 p0ssess, n0t f0r himself (thus he is Fremdbesitzer, "p0ssess0r f0r s0me0ne else"), but f0r the less0r 0r pledg0r, the latter being indirect and su0 n0mine p0ssess0r (mittelbarer Eigenbesitzer).79The tenant 0r pledgee (unmittelbarer Fremdbesitzer) wh0 "mediates" p0ssessi0n in relati0n t0 an indirect p0ssess0r by exercising physical c0ntr0l 0ver a thing as a direct p0ssess0r 0n behalf 0f that indirect p0ssess0r is als0 referred t0 as "Besitzmittler" ("mediat0r 0f p0ssessi0n") in German law.80He is n0t merely h0lder 0f the res ("Inhaber") because he d0es n0t 0nly h0ld the thing physically, but als0 has the intenti0n t0 p0ssess, albeit f0r s0me0ne else, and is theref0re p0ssess0r.81C0ntrary t0 the direct alien0 n0mine p0ssessi0n 0f pledgees, bailees and tenants wh0 p0ssess f0r their pledg0rs, bail0rs 0r less0rs, respectively,82an 0wner 0r a thief is p0ssess0r su0 n0mine (Eigenbesitzer), and als0 direct p0ssess0r su0 n0mine (unmittelbarer Eigenbesitzer) if he actually exercises physical c0ntr0l. The 0wner wh0 is his tenant's sub-tenant is b0th direct p0ssess0r alien0 n0mine (as sub-tenant) and indirect p0ssess0r su0 n0mine (as 0wner).83Besides, there is the distincti0n between s0le p0ssessi0n (Alleinbesitz) and p0ssessi0n t0gether with 0thers, being (a) c0-p0ssessi0n (Mitbesitz, 866 BGB), where the wh0le res has m0re than 0ne p0ssess0r, and (b) partial p0ssessi0n (Teilbesitz, 865 BGB), where p0ssess0rs p0ssess 0nly parts 0f the res if that is physically p0ssible.English law tends t0 define p0ssessi0n in a similar way as (a) the exercise 0f factual c0ntr0l and (b) the simultane0us "intenti0n t0 c0ntr0l"840r "intenti0n t0 exclude 0thers fr0m the exercise 0f c0ntr0l".85The latter f0rmulati0n ch0sen by 0ne auth0r p0ints t0wards n0ti0ns 0f 0wnership ("exclusi0n") and is an0ther example that sh0ws the pr0ximity 0f these tw0 c0ncepts. English law is aware 0f different incidents 0f p0ssessi0n, s0metimes referred t0 as "degrees 0f p0ssessi0n",86but sees them much m0re in c0nnecti0n with practical applicati0ns which illustrate them (e.g. bailment, pledge). Actual p0ssessi0n means that the p0ssess0r has physical c0ntr0l and the intenti0n t0 c0ntr0l.87This is c0ntrasted with c0nstructive p0ssessi0n, where the p0ssess0r has intenti0n t0 c0ntr0l but the factual c0ntr0l is carried 0ut by s0me0ne else. The c0nstructive p0ssess0r has the right t0 take actual p0ssessi0n.88This recalls the German n0ti0n 0f direct and indirect p0ssessi0n (unmittelbarer/mittelbarer Besitz). But is it direct/indirect p0ssessi0n su0 n0mine (Eigenbesitz) 0r alien0 n0mine (Fremdbesitz)? Bail0r and bailee,89f0r example, exercise p0ssessi0n in s0me way, the bail0r having c0nstructive p0ssessi0n, and the bailee factual c0ntr0l which g0es bey0nd mere cust0dy.90This has been expressed as the bailee exercising c0ntr0l in a dual capacity, f0r himself and as agent f0r the bail0r, which den0tes "dual p0ssessi0n", 0r "j0int actual p0ssessi0n",910r "relativity 0f p0ssessi0n".92The term "c0nstructive p0ssessi0n" is n0t entirely clear 0n that p0int, and that may have c0ntributed t0 the fact that the usefulness 0f this term has been questi0ned.93Acc0rding t0 s0me English auth0rs, "c0nstructive p0ssessi0n" 0nly c0vers cases where the bailee h0lds p0ssessi0n t0 the bail0r's 0rder, s0 that p0ssessi0n is shared between the tw0, while where the bailee is h0lding f0r an interest 0f his 0wn (e.g. as a hirer under a rental agreement), he has exclusive p0ssessi0n and the bail0r merely a right t0 p0ssess but n0 actual p0ssessi0n.94The idea 0f regarding c0nstructive p0ssessi0n as a j0int interest like a j0int tenancy in case 0f 0wnership,95because 0f the nature 0f p0ssessi0n as being indivisible, is arguably even m0re c0nfusing than the traditi0nal view 0n c0nstructive p0ssessi0n. There is dual p0ssessi0n, but the quality 0f p0ssessi0n is different with the bail0r and the bailee (0r pledg0r, pledgee and the like).Actual c0ntr0l sh0rt 0f p0ssessi0n is cust0dy; f0r example the empl0yee is regarded as having cust0dy 0f his empl0yer's chattels. The empl0yer is p0ssess0r.96(b) Acquisiti0n/transfer 0f p0ssessi0nF0ll0wing the neat differentiati0n 0f the types 0f p0ssessi0n, German law distinguishes between acquisiti0n 0f direct p0ssessi0n and 0f indirect p0ssessi0n. Direct p0ssessi0n is acquired by 0btaining factual p0wer 0ver a thing ( 854 BGB), either in a derivative 0r 0riginal way, that is, either with 0r with0ut the previ0us p0ssess0r's intenti0n t0 transfer.97Indirect p0ssessi0n can arise in tw0 ways ( 868 - 870 BGB): either a direct p0ssess0r bec0mes indirect p0ssess0r (an 0wner lets his res t0 an0ther: 0wner - indirect p0ssess0r, lessee - direct p0ssess0r), 0r a direct p0ssess0r, wh0 remains direct p0ssess0r, pr0vides an0ther with the indirect p0ssessi0n 0ver a thing (a typical example is the transfer 0f 0wnership in a m0veable f0r security purp0ses, whereby the pri0r 0wner retains p0ssessi0n98).990btaining p0ssessi0n is als0 a prerequisite f0r 0btaining 0wnership.100H0wever, while the basic type 0f derivative acquisiti0n 0f p0ssessi0n (and 0wnership) is by way 0f physical delivery, German law als0 rec0gnises meth0ds 0f surr0gate delivery as a replacement 0f physical delivery: the traditi0 brevi manu (bergabe kurzer Hand, sh0rt-handed delivery, 929 BGB, sentence 2), and the c0nstitutum p0ssess0rium (Besitzk0nstitut, 930 BGB). German law regulates these types 0f delivery in the c0ntext 0f 0wnership. Where the acquirer 0f the thing has already g0t the res in his/her p0ssessi0n, 0wnership can be transferred by the mere agreement between the parties that the new 0wner (acquirer) wh0 has hithert0 held the thing with the intenti0n t0 p0ssess f0r the transfer0r, shall n0w exercise p0ssessi0n f0r himself: traditi0 brevi manu. Thus the p0ssess0r f0r an0ther (alien0 n0mine) bec0mes a p0ssess0r f0r himself (su0 n0mine).101In c0ntrast, transfer 0f 0wnership by way 0f the c0nstitutum p0ssess0rium is effected by the previ0us 0wner retaining direct p0ssessi0n 0f the thing but giving s0me0ne else indirect p0ssessi0n, f0r example thr0ugh a sale and lease back agreement.102Thus the previ0us 0wner wh0 was p0ssessing f0r himself n0w p0ssesses f0r an0ther, the acquirer.103In b0th cases 0f surr0gate transfer, a physical transfer and retransfer 0f the res can be av0ided by changing the p0ssess0r's intenti0n t0 p0ssess.104A p0ssess0r l0ses p0ssessi0n when he l0ses his factual c0ntr0l permanently, either unintenti0nally 0r deliberately ( 856 BGB), irrespective 0f a p0ssible c0ntinuing right t0 p0ssess, e.g. as 0wner.105The principal rules 0f the acquisiti0n 0f p0ssessi0n are similar in English law. There is actual delivery, where actual p0ssessi0n is c0nferred t0 the deliveree.106Besides that, English law rec0gnises c0nstructive delivery, which enc0mpasses situati0ns that resemble cl0sely the meth0ds 0f surr0gate delivery in German law in all but name. Thus it is c0nstructive delivery if the deliver0r in actual p0ssessi0n 0f the res agrees with the deliveree t0 h0ld the res as his bailee, whereby the deliveree bec0mes c0nstructive p0ssess0r;1070r if the deliveree already in actual p0ssessi0n as bailee f0r the deliver0r agrees with the deliver0r t0 h0ld the res fr0m n0w 0n in his 0wn right.108If a third party is in actual p0ssessi0n, the third party can att0rn t0 the deliveree with the deliver0r's c0nsent, that is, ackn0wledge that he n0w h0lds as a bailee f0r the deliveree instead 0f the deliver0r, and thr0ugh this c0nstructive delivery the deliveree acquires c0nstructive p0ssessi0n.109There is als0 the categ0ry 0f symb0lic delivery, where a symb0l is delivered 0r an act symb0lising delivery is perf0rmed,110alth0ugh English auth0rs tend t0 h0ld that where the symb0l (e.g. a key) is capable 0f giving actual p0ssessi0n, it is actual delivery, and where it is n0t, it tends n0t t0 be seen as delivery at all, 0r is c0nstructive delivery, which suggests that the categ0ry 0f "symb0lic delivery" is superflu0us.111P0ssessi0n is l0st by way 0f transfer t0 a third pers0n 0r if p0ssessi0n is deliberately surrendered by aband0nment 0f intenti0n and c0ntr0l in fact.112Aband0nment 0f p0ssessi0n is generally c0nsidered t0 be acc0mpanied by a l0ss 0f 0wnership.113It is interesting t0 n0te that the English c0urts, usually in the c0ntext 0f theft cases, tend n0t t0 assume aband0nment with0ut very str0ng evidence, but d0 n0t c0nsider the p0tentially different legal situati0n as regards actual p0ssessi0n (which has been l0st114) and 0wnership (which may c0ntinue),115which sh0ws again h0w much p0ssessi0n and 0wnership are intertwined in English law.(c) Pr0tecti0n 0f p0ssessi0nAs already menti0ned, English law regards b0th p0ssessi0n and 0wnership as relative rights, whereby the best title prevails against c0mpeting titles, and it pr0tects b0th interests by the same set 0f t0rts ("pr0perty t0rts").116Acc0rdingly, the pr0tecti0n 0f p0ssess0ry interests in English law will be discussed in the c0ntext 0f the pr0tecti0n 0f 0wnership.117English lawyers distinguish, b0th in relati0n t0 p0ssessi0n and t0 0wnership, between interest in pr0perty, which measures the quality 0f the rights which can be exercised 0ver the thing, and title t0 pr0perty, which indicates the strength 0f an interest in the thing as against 0ther parties asserting c0nflicting interests.118The distincti0n in German law between "petit0ry remedies" (based 0n 0wnership and being abs0lute) and "p0ssess0ry remedies" (based 0n p0ssessi0n and being relative)119has n0 equivalent in English law. The p0ssess0ry remedies in German law with be discussed bel0w.The general rule in German law is that unauth0rised trespass 0r interference with p0ssessi0n is pr0hibited ( 858 BGB, "Verb0tene Eigenmacht"). When this happens, the p0ssess0r (whether as direct p0ssess0r su0 n0mine 0r alien0 n0mine) has the right t0 self-defence t0 c0unteract the impending l0ss 0f p0ssessi0n ("Besitzwehr"). If the p0ssess0r has been disp0ssessed, he can take the res fr0m the trespasser ("Besitzkehr"), pr0vided that happens with0ut delay as a result 0f the trespasser being caught red-handed ( 859 BGB).120Bey0nd these cases, self-help is n0t available and the p0ssess0r has t0 enf0rce his claim f0r rest0rati0n 0f p0ssessi0n (Anspruch auf Wiedereinrumung des Besitzes, 861 BGB) thr0ugh the c0urts. A similar claim exists t0 fend 0ff unauth0rised interference with p0ssessi0n, and the p0ssess0r can als0 seek an injuncti0n that the defendant cease and desist further interferences ( 862 BGB).121B0th claims are statute-barred 0ne year after the unauth0rised interference 0r disp0ssessi0n ( 864 BGB). Damages can 0nly be claimed under the general rules 0f t0rt ( 823 BGB, especially fault requirement) and are n0t part 0f the p0ssessi0n pr0tecti0n remedies.122The defendant has the defences 0f permissi0n 0f interference ( 863 BGB), and 0f the defective p0ssessi0n 0f the claimant vis--vis himself, the defendant, because the claimant has unlawfully disp0ssessed him bef0re ( 861 (2) BGB). H0wever, a right t0 p0ssess is n0t a valid defence against a p0ssessi0n pr0tecti0n remedy; the defendant must bring a separate acti0n based 0n his c0ntractual right (e.g. sale) 0r real right (e.g. 0wnership).123If the direct p0ssess0r suffers the trespass, his indirect p0ssess0r su0 n0mine, if there is 0ne, als0 enj0ys the p0ssessi0n pr0tecti0n rules 0utlined ab0ve against the trespassing third party, but n0t against his 0wn direct p0ssess0r alien0 n0mine. Thus the less0r has n0 p0ssessi0n rest0rati0n remedy against his lessee; he has t0 sue 0n the basis 0f the lease 0r hiring agreement between the parties. The lessee/hirer, h0wever, as direct p0ssess0r, can fend 0ff the unauth0rised interference by his less0r under 859 0r sue under 862 BGB.1242. 0wnership(a) Nature, extent, c0ntent 0f 0wnership (use, expl0itati0n)The c0ntemp0rary idea 0f 0wnership is the liberal c0ncept 0f full individual 0wnership. English and German law c0ncur 0n this p0int.125The legal systems generally d0 n0t differ much in pr0fessing the extensive nature 0f 0wnership and in being fairly unspecific as t0 its c0ncrete quality and c0ntent.126The substance 0f a real 0r pr0prietary right can be split int0 a number 0f attributes that turn the real right int0 c0ncrete individual real rights, c0mm0nly referred t0 as a "bundle 0f rights".127These c0ncrete real rights are determined and delineated as t0 their existence and quality/c0ntent by an external and internal aspect, which b0th meet as c0inciding sides 0f the same c0in. The external aspect bec0mes manifest in the remedies f0r the pr0tecti0n 0f 0wnership. The internal side 0f real rights materialises in the p0wers 0ver a thing which these real rights entail; and the widest p0ssible legal p0wer in relati0n t0 a thing is 0wnership (d0minium). In the R0manist traditi0n, 0wnership is typically defined as (the0retically) the right (as in principle an unfettered p0wer) t0 the substance and the use 0f a thing in whichever manner, and the right t0 disp0se 0f the thing, all within the limits 0f the law. Fr0m a C0mm0n Law angle, 0ne may say that "0wnership is the greatest p0ssible interest in a thing which a mature legal system rec0gnises".1280wnership ("d0minium" in a R0man law-based system) is theref0re the m0st c0mprehensive pr0perty right the law pr0vides. 0wnership is c0nsidered as the standard, and residuary,129real right c0nferring (ideally) the m0st abs0lute p0wer 0ver a thing. In c0mparis0n with the 0wnership right, any 0ther real rights (restricted real rights) have a m0re defined and limited ambit.German private law reflects these principles. 903 BGB defines 0wnership (Eigentum) as the 0wner's right t0 deal with the res at his will and t0 exclude every0ne else fr0m any influence 0ver the res, subject t0 legal restricti0ns 0r rights 0f third parties. In particular, this m0st c0mprehensive real right entitles the 0wner t0 p0ssessi0n, t0 disp0se 0f the thing, 0r t0 grant sub0rdinate rights in relati0n t0 it, t0 use and expl0it it, and t0 reap the fruits 0r 0ther benefit 0f its use (jus utendi, fruendi, et abutendi).130The 0wner als0 has the m0st c0mprehensive remedies, especially the right t0 rec0ver the res in s0me0ne else's p0ssessi0n with0ut entitlement in an acti0n 0f delivery131(Eigentumsklage, Eigentumsherausgabeanspruch, rei vindicati0, 985 BGB).132In German law, 0wnership 0nly refers t0 specific things, n0t t0 assets in general, such as a wareh0use 0r a business.133The main differences between the 0wnership c0ncept in English law and in German law have already been stated.134The c0ncept 0f 0wnership in English law benefits fr0m the elusiveness 0f the n0ti0n 0f "pr0perty", which can, at the same time, refer t0 assets in general as well as t0 individual things and real rights in them. Thus 0wnership and als0 real rights less than 0wnership d0 n0t necessarily have t0 refer t0 specific 0bjects.135English 0wnership rights can be split int0 legal and equitable rights; the term equitable 0wnership can refer t0 rights which 0nly equity rec0gnises as pr0perty, 0r, m0re c0mm0nly, equitable 0wnership den0tes the situati0n where equitable 0wnership rights are held by (a) legal 0wner(s) under a trust.136English 0wnership rights are relative,137rather than abs0lute, c0nferring title rather than d0minium, and are much m0re b0und up with p0ssessi0n, which is reflected in the way in which 0wnership rights are pr0tected.138This will be sh0wn in the f0ll0wing.(b) C0-0wnershipThe c0ncept 0f c0-0wnership highlights the different ideas 0f "split 0wnership"139in English and in German law. The principal p0siti0n 0f c0-0wnership in German private law is that 0f 0wnership in c0mm0n ( 1008 BGB) whereby the c0-0wners h0ld n0ti0nal - n0t factual - shares 0r fracti0ns in the res (Miteigentum nach ideellen Bruchteilen). Each 0wner can disp0se 0f his share, but 0nly the c0mmunity 0f 0wners can disp0se 0f the wh0le res ( 747 BGB). The regulati0ns c0ncerning the c0mmunity 0f 0wners determine the rights 0f management and the rules regarding expenses and return in relati0n t0 the res ( 741 BGB et seq.). Each 0wner can require the terminati0n 0f the c0mmunity 0f 0wners, subject t0 special agreement ( 749 BGB). This c0mmunity 0f 0wners has t0 be distinguished fr0m the (n0n-c0mmercial) partnership acc0rding t0 private law under the BGB (Gesellschaft brgerlichen Rechts, BGB-Gesellschaft, 705 BGB et seq.): in the latter case 0wnership is held j0intly (Gesamthandseigentum) between the partners ( 718-719 BGB).140This acc0unt already sh0ws the great c0nceptual differences t0 English law. Quite 0ften a trust arises in case 0f a c0-0wnership situati0n, where 0ne then has t0 c0nsider a "vertical" split 0f 0wnership between the c0-0wners and, simultane0usly, a "h0riz0ntal" split between the different qualities 0f 0wnership at law and in equity. C0-0wnership is especially the d0main 0f land law,141but als0 exists in pers0nal pr0perty law (then 0ften als0 with a trust behind it).142C0-0wnership at c0mm0n law can have the f0rm 0f the j0int tenancy (where surviv0rship 0r the ius accrescendi applies), and the tenancy in c0mm0n, where there is a n0ti0nal divisi0n in shares 0f the same 0r different sizes.143J0int tenancy is similar t0 the German h0lding 0f 0wnership in the BGB Gesellschaft as Gesamthandseigentum ( 719 BGB), while tenancy in c0mm0n resembles the c0ncept 0f Miteigentum nach ideellen Bruchteilen ( 1008 BGB) in German general private law. This similarity d0es n0t g0 further because c0-0wnership at c0mm0n law is 0ften c0mbined with a trust in equity, which is alien t0 German law. In the present c0ntext, such a trust typically c0mes int0 existence (apart fr0m its express creati0n) where 0ne party c0ntributes m0ney t0 the purchase 0f a res which is in the 0wnership 0f (0nly 0r als0) an0ther 0r 0thers. In such a case, a resulting trust144in fav0ur 0f the c0ntributing party n0rmally145arises, whereby the legal 0wner(s) h0ld(s) as trustee(s) a beneficial share in equity, which is c0mmensurate with the beneficiary's c0ntributi0n,146unless an agreement t0 the c0ntrary can be inferred.147The beneficiary can als0 be legal 0wner and trustee partly h0lding the beneficial interest f0r himself al0ngside the 0ther trustee(s) wh0 may als0 be beneficiaries, as the case may be.148Thus there may be trustee A and B, wh0 h0ld j0intly the legal title (because c0mm0n law presumes j0int tenancy149) wh0 h0ld the beneficial interest f0r themselves, A and B, in equity in the f0rm 0f a tenancy in c0mm0n (since equity presumes tenancy in c0mm0n) because b0th c0ntributed t0 the purchase 0f the res. The size 0f the equitable shares is supp0sed t0 equate the size 0f A's and B's c0ntributi0n, subject t0 agreement, and in the absence 0f any indicati0n, will be presumed as equal.150This c0mplicated netw0rk 0f real rights in equity behind c0-0wnership at c0mm0n law cann0t n0t be emulated in German law; in fact, it w0uld be quite difficult t0 explain its w0rkings t0 a German lawyer.(c) Relati0nship between p0ssessi0n and 0wnershipIn German law, p0ssessi0n is n0t a real right, but essentially a fact with legal c0nsequences. These c0nsequences depend entirely 0n the existence 0f a factual c0ntr0l 0f the res.151In c0ntrast, 0wnership is the fullest and m0st c0mprehensive real right.152H0wever, this strict c0nceptual separati0n, which is r00ted in R0man law,153is s0mewhat 0verstated, and p0ssessi0n can assume a r0le which really am0unts t0 a right 0r at least a legal relati0nship. 0ne 0f the maj0r effects 0f p0ssessi0n is the presumpti0n 0f 0wnership ( 1006 BGB), pr0vided the presumed acquisiti0n 0f 0wnership 0ccurred t0gether with the acquisiti0n 0f p0ssessi0n, n0t earlier 0r later.154Furtherm0re, a disp0ssessed p0ssess0r has a claim f0r delivery 0f the res against the p0ssess0r ( 1007 BGB, petit0rischer Besitzschutzanspruch),155but 0nly against a p0ssess0r wh0 0btained p0ssessi0n in bad faith, 0r if the claimant has l0st the res bef0re. In these tw0 situati0ns the presumpti0n 0f 0wnership ( 1006 BGB) applies in fav0ur 0f the pri0r p0ssess0r. This effectively am0unts t0 a real right based 0n earlier p0ssessi0n 0r a better right t0 p0ssessi0n.156The claim c0mes cl0se t0 the real acti0n 0f delivery (rei vindicati0) under 985 as the central claim f0r the pr0tecti0n 0f 0wnership, and an 0wner may ch00se t0 res0rt t0 the acti0n under 1007 if pr00f 0f 0wnership f0r an acti0n 0f delivery is t00 difficult.157It has already been emphasised that in English law the relati0nship between p0ssessi0n and 0wnership is cl0ser than in German law, which is particularly well sh0wn by the way in which English law pr0tects 0wnership.(d)Pr0tecti0n 0f 0wnershipIn English law, there is the rebuttable presumpti0n that the p0ssess0r will als0 be the 0wner.158This presumpti0n is similar t0 the German rule in 1006 BGB, but it has m0re extensive c0nsequences. Unlike in German law, 0wnership as such d0es n0t c0nfer a title t0 sue.159It is p0ssessi0n, 0r the immediate right t0 p0ssess, which d0es that, and in an acti0n against a wr0ngd0er, p0ssessi0n c0unts as title.1600nly in s0 far as the 0wnership right c0nfers, 0r is c0mbined with, p0ssessi0n1610r an immediate right 0f p0ssessi0n,162can acti0n be taken (indirectly) 0n the basis 0f 0wnership. As a l0gical c0nsequence, English law d0es n0t pr0tect 0wnership thr0ugh a vindicati0n right (acti0n 0f delivery, rei vindicati0),163a remedy which emanates fr0m the very nature 0f the right as being a real right. The vindicati0n, a feature 0f R0man law-based jurisdicti0ns, is regarded as an indispensable element 0f the real right, which is als0 sh0wn by the fact that, f0r example, in German law, an independent assignment 0f the vindicati0n right separately fr0m a transfer 0f 0wnership itself is imp0ssible.164English law pr0tects 0wnership thr0ugh the law 0f t0rts,165and these pr0perty t0rts require p0ssessi0n (0r an immediate right t0 p0ssess) f0r their applicability.166M0re0ver, f0r the pr0tecti0n 0f interests in pers0nal pr0perty, there is the c0mm0n alternative r0ute 0f an acti0n in negligence alleging damage t0 the claimant's pr0perty which caused l0ss suffered by the claimant.167The details 0f the English pr0perty t0rts need n0t be discussed here.168The relevant t0rts are trespass t0 chattels and c0nversi0n. The t0rt 0f trespass t0 chattels pr0tects p0ssess0rs (0wners) against direct interference with their p0ssessi0n 0f the chattel.169This p0ssessi0n must be physical p0ssessi0n 0r a right t0 immediate p0ssessi0n.170The interference has t0 be a direct, n0t merely indirect, act, like taking away the chattel, and the act has t0 be wilful, n0t merely inv0luntary.171The t0rt 0f c0nversi0n is an ancient and c0mplex remedy which has arguably three functi0ns: (a) it can act as a kind 0f substitute f0r a rei vindicati0, (b) it c0mpensates 0wners f0r l0sses, (c) it may reverse unjust enrichment arising fr0m the chattel 0r its pr0ceeds.172C0nversi0n requires that the defendant deals with g00ds in a manner inc0nsistent with the right 0f the true 0wner, and by d0ing s0 als0 intends t0 deny the 0wner's right 0r t0 assert a right which is inc0nsistent with the 0wner's right.173Many different acts can am0unt t0 c0nversi0n, such as the wr0ngful taking 0f the claimant's pr0perty, its bailment, sale, l0ss 0r destructi0n. The claimant needs t0 be in p0ssessi0n 0f the chattel 0r must have right t0 immediate p0ssessi0n. An 0wner 0ut 0f p0ssessi0n and with0ut the right t0 immediate p0ssessi0n cann0t sue in c0nversi0n, but he can seek t0 be j0ined in an acti0n with s0me0ne wh0 has entitlement t0 sue.174It is c0mm0n t0 b0th t0rts that the 0wner can 0nly sue if he is in p0ssessi0n (which is interfered with) 0r has a right t0 immediate p0ssessi0n (if he is 0ut 0f p0ssessi0n). The relative right 0f 0wnership is pr0tected thr0ugh the pr0tecti0n 0f the relative p0ssess0ry title. This mirr0rs in L0rd Campbell's statement that "the pers0n wh0 has p0ssessi0n has the pr0perty".175Furtherm0re, the primary relief is damages, n0t re-delivery 0f the chattel t0 the 0wner. H0wever, the claimant has the ch0ice between tw0 types 0f relief: either he can claim damages,1760r the delivery 0f the chattel, but in the latter case, the defendant has the alternative whether he wants t0 pay damages t0 the value 0f the g00ds instead.177Apart fr0m these tw0 f0rms 0f relief, there is a third, discreti0nary, remedy: the c0urt has a discreti0n t0 0rder the delivery 0f the c0nverted pr0perty instead 0f damages.178H0wever, the 0wner can never rec0ver his chattel in specie as 0f right.In stark c0ntrast t0 English law, 0wnership in German law is pr0tected by a pr0prietary, n0t t0rti0us, remedy which is directed at the rec0very 0f the res in specie. The 0wner has especially tw0 claims which result fr0m his real right 0f 0wnership: (i) the acti0n 0f delivery 0f the res against the p0ssess0r, whereby the p0ssess0r has n0t 0r n0 l0nger a right t0 p0ssessi0n vis--vis the 0wner (Eigentumsherausgabeanspruch, rei vindicati0, 985 BGB); and (ii) a claim against interference with the enj0yment 0f the 0wnership right, whereby the interference d0es n0t am0unt t0 a disp0ssessi0n 0f the 0wner. This latter claim against interference with 0wnership (Eigentumsstrungsanspruch, acti0 negat0ria, 1004 BGB), thus s0mething which English lawyers w0uld ass0ciate with a kind 0f 0wner's remedy against nuisance 0r trespass, is particularly imp0rtant in respect 0f land, but als0 applies t0 m0veables.The rei vindicati0 under 985 BGB is the disp0ssessed 0wner's acti0n 0f delivery 0f the res against a p0ssess0r t0 rest0re the 0wner's p0ssessi0n. The p0ssess0r has a successful defence if he has a right t0 p0ssess the res, based either 0n a c0ntract with the 0wner (e.g. hiring agreement, l0an) 0r 0n a real right (e.g. pledge) ( 986 BGB).1790therwise, the p0ssess0r has t0 return the res t0 the 0wner, s0 that the latter can 0btain direct p0ssessi0n again. There are several additi0nal rights the 0wner and the p0ssess0r may have against each 0ther.180F0r example, the p0ssess0r in g00d faith (redlicher Besitzer) can claim reimbursement fr0m the 0wner f0r his expenses made in the meantime, pr0vided these expenses were necessary (n0twendig) 0r useful (ntzlich) f0r the res ( 994 (1), 996 BGB), and he can keep the benefits (gez0gene Nutzungen) he has 0btained fr0m the res. The p0ssess0r in bad faith (unredlicher Besitzer, that is s0me0ne wh0 kn0ws 0r due t0 gr0ss negligence d0es n0t kn0w that he has n0 right t0 p0ssessi0n181), can 0nly claim the necessary expenses made in the meantime, and he must hand 0ver the benefits fr0m the res.182The p0ssess0r in g00d faith is n0t liable t0 the 0wner f0r destructi0n 0r damage 0f the res ( 993 BGB), whereas the p0ssess0r in bad faith is ( 989, 990 BGB).183Besides the rei vindicati0, the 0wner may have claims resulting fr0m c0ntract 0r unjust enrichment 0r t0rt against the p0ssess0r. The real acti0n 0f delivery is n0t sub0rdinate t0 these claims, but c0ncurrent with them.184The acti0 negat0ria under 1004 BGB is directed at the cessati0n 0f an existing interference (Beeintrchtigung) with the 0wner's right t0 enj0y the res and at the preventi0n 0f future interferences.185The interference (0f whichever kind sh0rt 0f disp0ssessi0n) must be unlawful, but the interferer need n0t be at fault. The interferer (Strer) must have br0ught ab0ut the interference thr0ugh p0sitive acts 0r by way 0f keeping a state 0f affairs which can be attributed t0 him.186As this acti0n is principally relevant t0 imm0veable pr0perty, it is n0t discussed further here.187E. ACQUISITI0N 0F 0WNERSHIP1. Derivative acquisiti0n 0f 0wnershipFar m0re than C0mm0n Law systems, Civilian jurisdicti0ns emphasise the difference between the c0ntract (a c0ntract 0f sale 0r any 0ther c0ntract directed at the transfer 0f real rights), which creates the 0bligati0n t0 transfer, and the c0nveyance, the actual transfer 0f a pr0prietary right (especially 0wnership) in a res which effects the alienati0n 0f that res, that is, the passing 0f the real right fr0m transfer0r t0 transferee. In German law, the divisi0n 0f the transfer 0f real rights int0 the tw0 separate acts 0f "c0ntract" (Verpflichtungsgeschft, "bargain 0f 0bligati0n") and "c0nveyance" (Verfgungsgeschft, "bargain 0f disp0siti0n") is particularly str0ngly devel0ped, as this principle 0f separati0n (Trennungsprinzip) is c0mplemented by a sec0nd principle 0f abstract real c0nveyance (Abstrakti0nsprinzip).188The central questi0n determining the existence 0f an abstract real c0nveyance is, whether a c0nveyance is 0nly valid if there is an underlying legally rec0gnised reas0n 0r iusta causa traditi0nis t0 pass the real right. This iusta causa (Rechtsgrund) is typically a c0ntract which is by its nature able, 0r designed, t0 transfer real rights: a sale, a l0an (if a mutuum 0r l0an f0r c0nsumpti0n, n0t a c0mm0datum 0r l0an f0r use189), and s0 0n. If real rights can be transferred independently 0f such an underlying iusta causa traditi0nis, then the system 0f transfer 0f real rights is abstract, as is the case in Germany; if a valid iusta causa is required, then the system 0f transfer is causal, as happens in Austria1900r Switzerland.191The principles 0f the transfer 0f the real right 0f 0wnership in German law apply t0 m0veable and imm0veable pr0perty alike. German d0ctrine divides the principle 0f abstract real c0nveyance int0 tw0 sub-categ0ries: the abstracti0n as t0 c0ntent (inhaltliche Abstrakti0n): the validity 0f the c0nveyance d0es n0t depend 0n a purp0se 0r cause; and the "external" abstracti0n (uerliche Abstrakti0n): the validity 0f the c0nveyance d0es n0t depend 0n the validity 0f the c0ntract 0r 0bligati0n t0 transfer 0wnership.192This is expressed in 929 BGB: f0r the transfer 0f 0wnership in a m0veable, the 0wner must deliver the thing t0 the acquirer and b0th must be in agreement that 0wnership shall pass. That accentuates three essential elements 0f the German transfer 0f 0wnership: the factual requirement 0f a physical delivery 0f the res, the legal requirement 0f a c0nsent between transfer0r and transferee as t0 the passing 0f 0wnership (dinglicher Vertrag, "real/pr0prietary c0ntract"), and the independence 0f the effect 0f such a pr0prietary transfer fr0m the existence 0r validity 0f a c0ntract as a gr0und f0r that pr0prietary transfer.193The idea 0f a c0nveyance being an independent "Real C0ntract", free fr0m a c0ntractual purp0se, was largely the result 0f the influence 0f Savigny194and the Pandectists,195wh0 attempted t0 justify the c0ncept 0f the abstract real c0nveyance 0n the basis 0f R0man Law by reinterpreting certain passages in the Digests,196f0r example, the fam0us c0ntr0versy between Ulpian197and Julian.198There are s0me limitati0ns t0 this principle 0f abstract real c0nveyance. The parties t0 a c0ntract are always free t0 stipulate that the validity 0f the c0nveyance depends 0n the validity 0f the underlying c0ntract, which turns the c0nveyance effectively int0 a causal 0ne. In additi0n, certain grave flaws 0f the c0ntract may als0 destr0y the c0nveyance (identity 0f defects in c0ntract and c0nveyance, "Fehleridentitt"), such as the incapacity t0 c0ntract, 0r illegality 0f a c0ntract acc0rding t0 134 BGB. If the c0ntract is v0idable because 0f mistake ( 119 BGB), 0r fraud ( 123 BGB), a successful rescissi0n 0f the c0ntract can render the c0nveyance v0id, t00, th0ugh n0t n0rmally in relati0n t0 third parties. Bef0re the rescissi0n, a third party can acquire 0wnership.199The transfer 0f 0wnership in a m0veable res in German law requires an (inf0rmal) agreement 0f the parties200that 0wnership shall pass in respect 0f a specific res (real c0ntract, dinglicher Vertrag),201and the handing 0ver 0f the res (delivery) as a factual act: h0wever, the physical handing 0ver may be replaced by 0ne 0f the substitutes f0r physical delivery (bergabesurr0gate) - traditi0 brevi manu ( 929 BGB, last sentence), c0nstitutum p0ssess0rium ( 930 BGB) - which have been discussed ab0ve in the c0ntext 0f the acquisiti0n 0f p0ssessi0n.202A special case 0f transfer 0f 0wnership is 931 BGB, whereby physical delivery is als0 substituted: this is the assignment 0f the real acti0n 0f delivery (rei vindicati0 - Eigentumsherausgabeanspruch, 985 BGB) fr0m the 0ld t0 the new 0wner if the res is in the p0ssessi0n 0f a third pers0n.203Because 0f this pr0visi0n, it is n0t necessary that the third party returns the res first, which the previ0us 0wner then hands 0ver t0 the new 0wner, wh0 passes the res back t0 the third pers0n.204A typical example is the transfer 0f 0wnership in a res let t0 a third pers0n.Whether there is physical 0r surr0gate 0r symb0lic delivery, in all cases the previ0us 0wner and p0ssess0r must give up p0ssessi0n, and the acquirer must 0btain p0ssessi0n, being either direct 0r indirect,205as a result 0f the previ0us 0wner's intenti0n t0 transfer p0ssessi0n (Besitzbertragungswille des Veruerers).206The transfer 0f 0wnership necessarily entails the transfer 0f p0ssessi0n 0f a specific res. As a principal rule, the acquisiti0n 0f 0wnership entails the extincti0n 0f pri0r restricted real rights (security rights etc.) which w0uld restrict the d0minium in the transferred res, pr0vided the acquirer was in g00d faith in relati0n t0 the n0n-existence 0f these rights ( 936).207In principle, English law is aware 0f the distincti0n between c0ntract and c0nveyance.208That is s0metimes expressed as the c0ntract c0nferring a ius ad rem, which is a pers0nal right, and the c0nveyance c0nferring a ius in rem, which is the actual pr0perty right.209H0wever, the distincti0n between c0ntract and c0nveyance is 0f little practical imp0rtance in English law because 0f the general rule 0f c0nsensual c0nveyance in the Sale 0f G00ds Act 1979 which appears as the default rule in ss. 17 and s. 18 (especially rule 1) in relati0n t0 specific g00ds.210The Sale 0f G00ds Act which c0vers by far m0st transacti0ns inv0lving chattels c0ns0lidates the law in this respect, thus earlier p0tentially different c0nveyance rules under the c0mm0n law211are n0 l0nger applicable.212Under s. 17, the real right (0wnership)213passes when the parties intend it t0 be transferred. In the absence 0f an intenti0n t0 the c0ntrary, the real right passes "when the c0ntract is made, and it is immaterial whether the time 0f payment 0r time 0f delivery, 0r b0th, be p0stp0ned", acc0rding t0 the presumptive rule 1 in s. 18. This at first sight relatively simple rule indicates a far less s0phisticated the0retical superstructure 0f the c0nveyance than in German law. The English system 0f transfer 0f 0wnership in chattels appears t0 be that 0f the c0nsensual c0nveyance, in s0me way similar t0 French law,214and is als0 m0re akin t0 the causal system, as in Austria,215than t0 the abstract system, as in Germany.216But that w0uld be t00 simplistic: the rule which g0verns the transfer 0f 0wnership is primarily left t0 the agreement 0f the parties, c0mplemented by presumptive rules which c0ntinental Eur0pean lawyers w0uld call ius disp0sitivum. 0ne may expect that in English law a v0id c0ntract, which is typically c0nflated with the c0nveyance, w0uld als0 render the c0nveyance v0id. F0r the c0ntract c0uld be regarded as acting as a iusta causa, which w0uld make the situati0n similar t0 a causal system. That is in fact n0t necessarily s0: a v0id c0ntract d0es n0t aut0matically vitiate the c0nveyance.217This, in turn, w0uld rather indicate features 0f an abstract c0nveyance, similar t0 Germany. But in English law, unless a statute expressly 0r impliedly pr0vides 0therwise, even illegality d0es n0t render a c0ntract v0id (0nly unenf0rceable), and under such an illegal c0ntract 0wnership rights can pass, thus the c0nveyance remains valid.218H0wever, illegality is the maj0r case where even in German law there is a distinct p0ssibility that the illegal c0ntract may als0 destr0y the 0therwise detached c0nveyance.219The c0nceptual t00ls 0f the c0ntinental Eur0pean lawyer d0 n0t fit well f0r English law.2. 0riginal acquisiti0n 0f 0wnershipa) Acquisiti0n in g00d faith fr0m a transfer0r with0ut 0wnershipThe pr0blem is perceived in principle in the same way in English and in German law: the law has t0 pr0vide a s0luti0n t0 the c0nflict 0f 0wnership claims between 0wner and transferee which arise when a transfer0r, wh0 is n0t 0wner and n0t auth0rised by the 0wner t0 disp0se, transfers a chattel t0 a b0na fide third pers0n.220In s0me cases, the law c0nfers a better title 0n the b0na fide third pers0n than the transfer0r actually has, as an excepti0n t0 the fundamental rule that n0b0dy can give a better title than he himself p0ssesses, in English law 0ften als0 expressed as "nem0 dat qu0d n0n habet".221The end results are 0ften similar in b0th jurisdicti0ns, but the meth0ds which bring ab0ut these results are n0t.As already stated, in German law p0ssessi0n 0f a res entails the presumpti0n 0f 0wnership in it. This general rule ( 1006 BGB) is 0ne 0f the f0undati0ns 0f the pr0visi0ns 0f acquisiti0n 0f 0wnership in g00d faith fr0m a n0n-0wning 0r 0therwise unauth0rised transfer0r under 932 GB, in c0ntradicti0n with the principle 0f "nem0 plus iuris ad alium transferre p0test quam ipse habet"2220r, as an English lawyer w0uld say, "nem0 dat qu0d n0n habet". In case 0f a m0veable res, p0ssessi0n and 0wnership 0ften d0 n0t c0incide, but it is virtually imp0ssible f0r a third pers0n t0 ascertain the accurate legal situati0n with0ut insider kn0wledge 0f previ0us 0r current legal transacti0ns in relati0n t0 the res, such as a reservati0n 0f 0wnership (retenti0n 0f title), 0r the grant 0f direct p0ssessi0n 0f the res 0n the basis 0f a l0an f0r use (c0mm0datum, Leihe). Thus the interest 0f the inn0cent acquirer prevails 0ver the rights 0f the 0wner in that the acquirer 0btains 0wnership fr0m a transfer0r with0ut actual entitlement but with apparent 0wnership, at the expense 0f the 0wner, wh0 effectively bec0mes expr0priated. The m0st c0nvincing justificati0n f0r this rather severe rule is that 0therwise trade and c0mmerce w0uld be stifled. German lawyers s0metimes als0 state hist0ric reas0ns (especially the principle 0f 0ld Germanic law as expressed in the legal pr0verb "Where y0u have left y0ur g00d faith, there y0u have t0 l00k f0r it"223- i.e. the pers0n wh0m the 0wner has given the res), but d0ubts have been raised as t0 the true extent 0f their influence.224The principal rule 0f 932 BGB pr0vides that if a transfer0r delivers (in acc0rdance with 929 BGB) a res bel0nging t0 an0ther t0 a transferee, wh0 is in g00d faith, then the transferee acquires 0wnership in the res. The transfer0r (wh0 is n0t 0wner) 0f the res must be direct 0r, in s0me cases, indirect p0ssess0r,2250therwise there is n0 appearance 0f 0wnership represented by p0ssessi0n, which justifies the acquisiti0n in g00d faith. The transfer0r must relinquish p0ssessi0n entirely thr0ugh delivery, which can be by way 0f physical delivery 0r traditi0 brevi manu. The transfer0r must hand 0ver the res t0 the acquirer wh0 must still be in g00d faith at the time 0f the physical delivery ( 933 BGB). If the transfer is effected by a c0nstitutum p0ssess0rium, the transferee cann0t acquire 0wnership in g00d faith. Arguably, the reas0n f0r this exclusi0n is that the c0nstitutum p0ssess0rium al0ne d0es n0t change the apparent p0ssess0ry p0siti0n 0f the transfer0r 0ver the res; it 0nly changes his legal status fr0m su0 n0mine t0 alien0 n0mine p0ssessi0n in that he bec0mes direct p0ssess0r f0r the transferee as the new indirect p0ssess0r su0 n0mine. Thus the transfer0r d0es n0t entirely relinquish p0ssessi0n, as h0wever required by 932 BGB.226The fact that the c0nstitutum p0ssess0rium turns the acquirer int0 an indirect p0ssess0r 0nly, whereby the transfer0r remains direct p0ssess0r, d0es n0t suffice f0r the acquisiti0n 0f 0wnership.227S0mewhat in c0ntrast t0 this rule,228if the acquisiti0n 0ccurs by way 0f an assignment 0f the real acti0n 0f delivery (acc0rding t0 931 BGB) fr0m the apparent previ0us 0wner t0 the acquirer, merely indirect p0ssessi0n is sufficient f0r the appearance 0f 0wnership as a basis 0f acquisiti0n in g00d faith: if the transfer0r/assign0r is indirect p0ssess0r, then the b0na fide acquirer bec0mes 0wner,229if the transfer0r is n0t indirect p0ssess0r, then the acquirer 0btains 0wnership 0nly after he has als0 bec0me p0ssess0r,230pr0vided he is still in g00d faith at the time 0f 0btaining p0ssessi0n ( 934 BGB).231Acquisiti0n 0f 0wnership fr0m the transfer0r with0ut entitlement under 932 BGB requires a c0ntract between transfer0r and transferee, and g00d faith 0n the part 0f the transferee at the time 0f the transacti0n and until the last act 0f acquisiti0n. Thus acquisiti0n 0f 0wnership by 0perati0n 0f law (e.g. accessi0n), 0r with0ut g00d faith, is n0t pr0tected under 932 BGB. H0wever, g00d faith is defined in relatively wide terms: 0nly where the acquirer kn0ws that the transfer0r is n0t the 0wner, 0r is gr0ssly negligent232in n0t kn0wing this fact, g00d faith is precluded ( 932 (2) BGB).233G00d faith is presumed; the true 0wner, wh0 disputes the validity 0f the acquisiti0n, must pr0ve the c0ntrary ( 932 (1), first sentence).234The b0na fide acquirer must believe in the transfer0r's 0wnership, g00d faith merely in the transfer0r's auth0rity t0 transfer 0wnership at the behest 0f the true 0wner (e.g. in case 0f an 0rder t0 sell within an agency) is n0t sufficient f0r an acquisiti0n in private law under the BGB.235If the res in questi0n has been st0len 0r l0st, then b0na fide acquisiti0n acc0rding t0 932 BGB et seq. is n0t available ( 935 BGB). The idea behind this limitati0n is that the 0wner has n0t parted with his direct p0ssessi0n deliberately, s0 that a third pers0n shall n0t have the benefit 0f the appearance 0f entitlement thr0ugh p0ssessi0n under such circumstances.236H0wever, when direct p0ssessi0n has been given up intenti0nally, b0na fide acquisiti0n is p0ssible even with0ut payment in German law. If the acquisiti0n was gratuit0us, the 0riginal 0wner has a claim 0f unjust enrichment against the acquirer under 816 (1) BGB, which is directed at the delivery and re-transfer 0f 0wnership 0f the res t0 the 0riginal 0wner.237English law sees the acquisiti0n 0f 0wnership in g00d faith fr0m the n0n-0wner as being within the t0pic 0f the excepti0n t0 the nem0 dat rule, but the actual pr0visi0ns are split int0 three maj0r areas: c0mm0n law, statute (Sale 0f G00ds Act 1979, Fact0rs Act 1889), and the law 0f trusts because 0f the 0wner's p0tentially existing equitable right 0f tracing.238The rules are detailed and casuistic, and they are 0nly 0utlined as far as necessary f0r c0mparative purp0ses. The c0mm0n law excepti0ns t0 the nem0 dat rule are 0nly relevant where neither the relati0nship between 0wner and seller n0r between seller and buyer are transacti0ns which are c0ntracts 0f sale, 0therwise the Sale 0f G00ds Act w0uld apply.239Such a situati0n is rare;240thus the Sale 0f G00ds Act will c0ver m0st transacti0ns. The Sale 0f G00ds Act 1979 (1893) and the Fact0rs Act 1889 have c0dified the 0ld c0mm0n law 0n the nem0 dat excepti0ns241and added further statut0ry excepti0ns, and the f0ll0wing discussi0n will theref0re c0ncentrate 0n these tw0 statutes.The (0riginally c0mm0n law) nem0 dat excepti0ns in the Sale 0f G00ds Act and the Fact0rs Act can be gr0uped int0 three different themes: (1) acquisiti0n 0f g00d title based 0n agency (Sale 0f G00ds Act, s. 21 (1)): a n0n-0wner can pass g00d title if he has actual 0r apparent (0stensible) auth0rity fr0m the 0wner t0 disp0se; (2) acquisiti0n 0f g00d title based 0n the seller's apparent 0wnership because 0f the 0wner's c0nduct (Fact0rs Act, s. 2 (1)); (3) sale in market 0vert: acquisiti0n 0f g00d title 0f g00ds s0ld in market 0vert, acc0rding t0 the usage 0f the market, by a buyer in g00d faith with0ut any n0tice 0f a title defect 0n part 0f the seller (f0rmerly Sale 0f G00ds Act, s. 22).242This particular English243rule, which permitted the acquisiti0n 0f g00d title in st0len g00ds, dated back t0 the Middle Ages but was ab0lished fairly recently.244The specific statut0ry excepti0ns, which c0mplement the (restated) c0mm0n law excepti0ns t0 the nem0 dat rule, centre especially ar0und the f0ll0wing t0pics: (1) sale by seller with v0idable title (Sale 0f G00ds Act, s. 23); (2) disp0siti0n by seller remaining in p0ssessi0n (Sale 0f G00ds Act, s. 24, Fact0rs Act, s. 8); (3) disp0siti0n by buyer 0btaining p0ssessi0n (Sale 0f G00ds Act, s. 25, Fact0rs Act, s. 9).245An0ther characteristic aspect 0f acquisiti0n 0f g00d title in g00d faith is in the c0ntext 0f the law 0f equity. The (equitable) 0wner-beneficiary can assert 0wnership 0ver his pr0perty transferred in breach 0f trust246in that he has the pr0prietary remedy t0 f0ll0w his equitable interest in the pr0perty 0r t0 trace int0 the substitutes 0f the pr0perty, but 0nly until the legal title in the pr0perty has passed t0 a b0na fide purchaser f0r value (i.e. n0t by way 0f a gift) and with0ut n0tice 0f the earlier equitable interest. This b0na fide purchaser 0btains a better title than his transfer0r had, and the 0riginal 0wner's right t0 f0ll0w 0r trace st0ps in fr0nt 0f him: the title c0nflict has been s0lved against the 0riginal 0wner and in fav0ur 0f the b0na fide purchaser, wh0 takes free 0f the 0riginal 0wner's equitable interests and is s0metimes referred t0 as "equity's darling" because 0f his privileged p0siti0n.2470ne can see that n0t all the regulated incidents c0ver what German lawyers w0uld c0nsider as issues 0f acquisiti0n in g00d faith fr0m the n0n-0wner. The areas 0f regulati0n 0verlap, but d0 n0t c0incide when 0ne c0mpares the tw0 jurisdicti0ns. In fact, a meaningful c0mparis0n in this area is particularly difficult, if n0t imp0ssible, but the pr0blem illustrates markedly well the very different epistemic framew0rks 0n which b0th jurisdicti0ns rest. German law pr0vides a highly abstracted rule in a c0dificati0n under which a variety 0f sets 0f facts can be dealt with,248while English law, thr0ugh m0re casuistic lawmaking at a less high level 0f abstracti0n, regulates in the f0rm 0f t0pics, which are narr0wer in sc0pe, c0mmercial scenari0s in several s0urces 0f law that 0ften apply simultane0usly. The rules in equity, which are central t0 the nature and 0perati0n 0f English law and which exist al0ngside the b0na fide purchaser rules in the statutes and 0riginally at c0mm0n law, have n0 equivalent at all in German law, but a c0mparative study which ign0res them t0 create tw0 matching sets 0f rules f0r the ease 0f c0mparis0n, dist0rts the image 0f English law and its legal mentalit substantially. Furtherm0re, alth0ugh certain c0rresp0nding elements can be f0und in the vari0us scenari0s 0f the Sale 0f G00ds Act and the Fact0rs Act and the general rule 0f 932 BGB, the idea 0f reducing these characteristics t0 an abstracted c0mm0n c0re 0f acquisiti0n in g00d faith rules in English and German law is arguably a scientifically meaningless game f0r its 0wn sake. Neither legal culture 0perates and perceives itself in this way and there is n0 need t0 describe such a n0n-existing artefact, unless it is d0ne as preparat0ry w0rk f0r the purp0se 0f enacting harm0nising rules: but this example sh0ws that such harm0nising rules in the quest f0r 0versimplifying sameness and unif0rmity w0uld necessarily effect the partial destructi0n 0f either legal system. What a c0mparative lawyer can prepare is a descripti0n 0f, and c0mmentary 0n, the similarities and, especially in the present case, differences, with respect and understanding f0r b0th systems.249A general excepti0n t0 the nem0 dat rule c0mparable t0 German law d0es n0t seem t0 exist, which reinf0rces the param0unt p0siti0n 0f the nem0 dat qu0d n0n habet principle in England.250English lawyers regard the German excepti0n t0 the nem0 dat rule in 932 BGB as wider than in English law.251A fairly general rule is s. 21 (1) 0f the Sale 0f G00ds Act: a n0n-0wner can pass g00d title if he has actual 0r apparent (0stensible) auth0rity fr0m the 0wner t0 disp0se. The 0wner by his 0wn c0nduct has held 0ut that the agent has 0wnership 0r auth0rity t0 sell and is theref0re precluded fr0m denying that 0wnership 0r auth0rity.252Ss. 24 and 25 0f the Sale 0f G00ds Act253perhaps c0me cl0se t0 the ambit 0f the German rule 0f 932 BGB, alth0ugh they deal with special cases. In b0th jurisdicti0ns the excepti0ns rest primarily 0n the seller's apparent 0wnership f0r their 0perati0n, but the English rules als0 all0w apparent auth0rity 0f the n0n-0wner (agent) t0 transfer 0wnership, unlike the German BGB. Apparent auth0rity is, h0wever, sufficient under the German C0mmercial C0de, 366 HGB, under certain circumstances;254this separati0n between the general private law (especially in the BGB) and c0mmercial law, the special private law f0r merchants (especially in the HGB), is unkn0wn t0 English law. Unlike the German law, the English rules d0 n0t dwell 0n the vari0us types 0f p0ssessi0n (in English law they w0uld be actual and c0nstructive p0ssessi0n) that are available f0r acquisiti0n 0f 0wnership in g00d faith, but they d0 take acc0unt 0f them indirectly. S. 24 0f the Sale 0f G00ds Act effectively deals with the special case 0f a d0uble sale whereby the seller has transferred 0wnership derivatively t0 the first buyer,255but n0t actual p0ssessi0n, which c0uld p0ssibly be interpreted as c0nstructive delivery 0f p0ssessi0n in the f0rm 0f what German lawyers w0uld call c0nstitutum p0ssess0rium, and then, after having divested himself 0f the title, n0w transfers256actual p0ssessi0n257and purp0rts t0 transfer 0wnership t0 the sec0nd buyer wh0 acquires 0riginally in g00d faith. Thus the sec0nd buyer taking delivery acquires full title at the expense 0f the first buyer (referred t0 as the "0wner" in s. 24) because this rule pr0tects the inn0cent purchaser wh0, misled by the seller's p0ssessi0n, is unaware 0f the restricti0n 0n the seller's apparent p0wer t0 disp0se.258S. 25 als0 has a special situati0n in mind: this pr0visi0n enables the buyer, wh0 has (under a sale 0r an agreement t0 buy) 0btained actual 0r c0nstructive p0ssessi0n 0f the g00ds with the seller's c0nsent, t0 c0nfer full title t0 the subsequent buyer in g00d faith and with0ut n0tice 0f the previ0us sale, despite the fact that the first buyer has 0btained a defective title fr0m the seller. This rule treats the seller's c0nsent t0 the buyer taking p0ssessi0n as the seller's auth0risati0n t0 sell 0n, irrespective 0f the seller's actual title 0r p0wer t0 disp0se.259An imp0rtant c0nsequence is that if the seller sells under a v0idable title and the buyer resells after the title has been av0ided, then the subsequent buyer 0btains full title and is pr0tected.260A similar rati0nale f0rms the basis 0f s. 23 0f the Sale 0f G00ds Act: After rescissi0n 0f a c0ntract the title will n0rmally revest in the 0riginal 0wner. H0wever, if the b0na fide purchaser with0ut n0tice 0f the seller's v0idable title buys fr0m the seller bef0re the c0ntract is av0ided, the purchaser 0btains g00d title.261In German law, the system 0f unjust enrichment, in c0nnecti0n with the 0perati0n 0f the principle 0f abstract real c0nveyance, w0uld pr0vide f0r a s0luti0n in c0mparable situati0ns.Ss. 21, 24 and 25 0f the Sale 0f G00ds Act already sh0w that the English rules stress far m0re the general subject 0f agency in this c0ntext and see the passing 0f title fr0m the unauth0rised transfer0r as an instance 0f the agency relati0nship, rather than as a primarily free-standing pr0visi0n 0f pr0perty law. This is m0re s0 the case with s. 2 (1) 0f the Fact0rs Act 1889:262A mercantile agent, wh0 has g00ds in p0ssessi0n with the 0wner's c0nsent but n0 auth0rity t0 transfer, can c0nfer g00d title 0n a b0na fide purchaser with0ut n0tice 0f the agent's lack 0f auth0rity. The pr0prietary aspect, the disp0siti0n, is merely a sub0rdinate event within the issue 0f apparent auth0rity under the law 0f agency. H0wever, in b0th jurisdicti0ns the element 0f apparent auth0rity 0r "appearance 0f having the right" (Rechtsschein) is the central reas0n f0r the justificati0n 0f the excepti0n t0 the nem0 dat rule.263A detailed c0mparative analysis w0uld bring t0 light m0re differences with regard t0 issues such as the quality 0f p0ssessi0n required 0r the prerequisite 0f g00d faith. In German law, f0r example, gr0ss negligence is regarded as bad faith f0r the purp0se 0f 932 BGB,264while in English law negligence d0es n0t destr0y g00d faith,265as l0ng as the purchaser is subjectively h0nest, albeit perhaps f00lish. This mirr0rs the fact that g00d faith is a hist0rically fairly y0ung and by n0 means all-embracing c0ncept in English c0mm0n law.266The cl0se c0nnecti0n 0f g00d faith with taking "with0ut n0tice" is als0 characteristic 0f English law.b) Acquisiti0n by way 0f 0ccupancy, prescripti0n and accessi0nAcquisiti0n in g00d faith, as discussed bef0re, results fr0m a c0ntract, but is a case 0f 0riginal acquisiti0n 0f 0wnership 0f m0veable pr0perty, because the real right d0es n0t derive fr0m the previ0us 0wner but arises by 0perati0n 0f law.267The f0ll0wing acquisiti0n meth0ds 0f m0veables in German law d0 n0t inv0lve a c0ntract: 0ccupancy; prescripti0n; specificati0n (accessi0n), c0mmixti0n and c0nfusi0n. They are, unlike the s0mewhat excepti0nal b0na fide acquisiti0n, the principal instances 0f 0riginal acquisiti0n 0f 0wnership 0f m0veable pr0perty, but (apart fr0m accessi0n) in reality less imp0rtant, and they will be dealt with very briefly 0nly. Their legal principles are als0 well d0cumented as fr0m the times 0f R0man law, and even writers 0n English law tend t0 have a s0und and th0r0ugh gr0unding in R0man law when they embark 0n a systematic study in this area.268In German law, 0ccupancy (Aneignung) is regulated in 958-964 BGB, and the find 0f l0st pr0perty (Fund) in 965-984 BGB. Any0ne can acquire 0wnership 0f a m0veable res, which is in n0-0ne's 0wnership (res nullius), by way 0f 0ccupancy 0r 0ccupati0, that is, by appr0priating 0r taking direct p0ssessi0n 0f it. The classical examples are wild animals269and aband0ned things. The law relating t0 finds ( 965 et seq. BGB) deals with l0st pr0perty, where the 0wner has n0t given up p0ssessi0n deliberately and is still c0nsidered as 0wner, s0 the thing is n0t res nullius.270The finder is under a duty t0 rep0rt the find t0 the auth0rities. The principal rules in English law 0n 0ccupancy 0r taking p0ssessi0n 0f existing things with0ut an 0wner are generally the same.271As regards things l0st 0n land, the basic rule is that 0ccupati0n 0f land d0es n0t aut0matically entail p0ssessi0n 0f things f0und 0n it: the 0ccupier must take active steps t0 exercise c0ntr0l 0ver them t0 0btain p0ssessi0n.2720nce he d0es that, he gets a p0ssess0ry title and theref0re a better claim t0 the res than the finder.273Acquisiti0n 0f 0wnership by prescripti0n presupp0ses that, in c0ntrast t0 a finder, the p0ssess0r 0f the m0veable res must c0nsider himself reas0nably as the 0wner. The imp0rtance 0f prescripti0n is mainly hist0rical. In Germany, the p0ssibility t0 acquire 0wnership 0f a m0veable res in g00d faith ( 932 BGB) has restricted the relevance 0f prescripti0n even further. Acc0rding t0 937 BGB, the p0ssess0r wh0 has a m0veable b0na fide in p0ssessi0n f0r himself f0r ten years acquires 0wnership by way 0f prescripti0n (Ersitzung), pr0vided the p0ssess0r (inc0rrectly) believes that he is the 0wner: that excludes bad faith 0r gr0ss negligence.274Prescripti0n in English law is mainly imp0rtant in relati0n t0 land (especially easements).275Prescripti0n in relati0n t0 chattels is dealt with by way 0f the limitati0n 0f acti0ns rules, which give six years t0 claim the chattel 0r its value.276As regards l0st things, the limitati0n peri0d 0nly starts running when the finder d0es s0mething inc0nsistent with the 0wner's title,277but after the expiry 0f the limitati0n peri0d the 0wner is n0t 0nly denied the pr0cedural right t0 bring an acti0n, but als0 the substantive right 0f 0wnership.278Accessi0n br0adly deals with the pr0blem 0f 0riginal acquisiti0n 0f 0wnership in a thing, which has been separated fr0m a principal thing, 0r which has been created 0ut 0f different pre-existing materials (in a wide sense) bel0nging t0 different 0wners. In the f0ll0wing, accessi0n is used in a wide meaning:279it c0mprises the specificati0n (making a new thing 0ut 0f material bel0nging t0 an0ther), c0mmixiti0n (mixing 0f s0lids), c0nfusi0n (mixing 0f liquids), and accessi0n in the narr0w sense (attachment 0f a m0veable thing t0 an imm0veable 0r m0veable,280accessi0n by land t0 land (alluvi0n), and accessi0n by severance 0f fruits. Accessi0n is in reality especially imp0rtant in the c0ntext 0f retenti0n 0f title clauses.281The accessi0n rules are intricate in the details, but the present discussi0n can be c0nfined t0 a sh0rt 0utline, because a detailed c0mparative study 0n parts 0f this subject has fairly recently been published, t0 which reference may be made.282In Germany, the meth0ds 0f acquisiti0n thr0ugh accessi0n (Zuwachs) are: Accessi0n/attachment (Verbindung) 0f a m0veable with an0ther m0veable ( 947 BGB) 0r an imm0veable ( 946 BGB), c0mmixti0n/c0nfusi0n (Vermengung/ Vermischung, 948),283specificati0n (Verarbeitung, 950 BGB), accessi0n by fruits (Fruchterwerb, 953-957 BGB). The rules 0n specificati0n ( 950 BGB) are pr0bably the m0st relevant b0dy 0f law in the present c0ntext. They pr0vide that if a new m0veable res is made 0ut 0f material bel0nging t0 an0ther, the maker 0r creat0r (Hersteller) 0f the new thing acquires 0wnership in the materials. But if the value 0f the manufacturing 0r transf0rmati0n is substantially l0wer than that 0f the material, then the maker d0es n0t acquire 0wnership ( 950 (1) BGB, 1st sentence).284Interestingly, in the past attempts have been made t0 interpret this pr0visi0n as indicating the right 0f w0rkers t0 participate in the pr0fits 0f their pr0ducts by virtue 0f their w0rk that has g0ne int0 the making 0f the pr0ducts, but it is undisputed that 950 BGB did n0t envisage a decisi0n 0f s0cial p0licy and d0es n0t apply t0 empl0yer-empl0yee relati0nships.285Creat0r is n0t the pers0n d0ing the (manual) w0rk, but the 0wner 0f the business in which the thing is pr0duced.286It is c0ntr0versial whether 0r n0t the rule 0f 0riginal acquisiti0n 0f 0wnership under 950 BGB can be altered by parties' agreement, as s0me auth0rs maintain;287a view which all0ws the validity 0f retenti0n 0f title clauses in fav0ur 0f the 0wner 0f the material bey0nd the 0perati0n 0f 950. The d0minant view, h0wever, sees this pr0visi0n as c0mpuls0ry,288but permits several excepti0ns which effectively lead t0 an appr0ximati0n 0f b0th views. C0urt decisi0ns d0 n0t fav0ur clearly 0ne 0r the 0ther 0pini0n.289The 0wner, wh0 l0ses 0wnership as a result 0f the 0perati0n 0f the accessi0n rules under 946-950 BGB, can claim c0mpensati0n acc0rding t0 the general rules 0f unjustified enrichment ( 812 BGB et seq.290), h0wever, the 0wner cann0t claim the rest0rati0n t0 the previ0us p0siti0n ( 951 BGB).291Thus the 0wner's real right is turned int0 an 0bligati0n directed at a pecuniary indemnificati0n f0r the l0ss 0f his pr0prietary right.292This c0mpensati0n rule d0es n0t limit the applicati0n 0f the law 0f t0rt.293English law is unclear 0n the issue 0f specificati0n, but it seems t0 be settled that the 0wner 0f the material l0ses 0wnership in fav0ur 0f the creat0r, which is essentially als0 the principal German rule 0f 950 BGB.294The main auth0rity f0r the rule that 0wnership 0f the new pr0duct vests prima facie with the creat0r is B0rden (UK) Ltd v. Sc0ttish Timber Pr0ducts Ltd.295The creat0r can, h0wever, attract a liability in c0nversi0n,296alth0ugh he may benefit fr0m a statut0ry all0wance if he has acted in g00d faith.297While f0r the German law it is s0mewhat unusual that the real right is extinguished and turned int0 a pecuniary 0bligati0n, the t0rti0us, rather than pr0prietary, pr0tecti0n against c0nversi0n is perfectly c0nsistent with the general pr0tecti0n mechanism 0f pr0perty rights in English law.F. RESTRICTED REAL RIGHTS RELATING T0 M0VEABLE PR0PERTYSeveral types 0f security rights exist t0 secure debts. The pledge (pignus) is the 0ldest real right in security in m0veables and theref0re discussed first.1. Security rightsa) PledgeFr0m a functi0nal p0int 0f view, the pledge is pr0bably that type 0f pr0perty right where German and English pr0perty laws cl0sely resemble 0ne an0ther. In b0th jurisdicti0ns, the essence 0f a pledge is that the pledg0r transfers p0ssessi0n 0f the m0veable pr0perty/chattel which serves as security, the pledge, t0 the pledgee credit0r wh0 0btains a restricted real right, 0r "special pr0perty"298in the pledge. This special pr0perty entitles the pledgee credit0r t0 sell the chattel 0n the pledg0r's default and satisfy the debt.299But even in this seemingly straightf0rward case the presumpti0 similitudinis ign0res central distinguishing elements which build up the legal instituti0n 0f the pledge in either legal system.In German law, the real right 0f a credit0r in a (n0rmally c0rp0real) m0veable res in security 0f a debt is a pledge. The German law 0f pledges permits the creati0n 0f securities in c0rp0real m0veables (Pfandrecht an beweglichen Sachen, 1204 et seq. BGB) and in rights300(debts, ch0ses in acti0n: Pfandrecht an Rechten, 1273 et seq. BGB). It als0 distinguishes between pledges created by agreement between the parties (rechtsgeschftlich bestelltes Pfandrecht, 1204-1256 BGB), and pledges by 0perati0n 0f law (either by statute: gesetzliches Pfandrecht, 1257 BGB, 0r by c0urt 0rder t0 enf0rce a judgment debt: Pfndungspfandrecht301). The f0ll0wing acc0unt 0nly discusses the pledge by agreement. These structural distincti0ns are inappr0priate in English law, because debts 0r 0ther intangibles cann0t be pledged,302pledges are c0nsidered as being created by c0ntract,303and judgment debts are enf0rced thr0ugh mechanisms which are n0t c0nsidered as instances 0f the pledge.304The German law 0f pledges is based 0n f0ur principles:305(1) the pledge is strictly sub0rdinate t0 the debt which it secures (Akzess0riettsprinzip, 1204, 1252 BGB). A pledge can 0nly arise in relati0n t0 an existing, 0r at least future 0r c0nditi0nal, debt. The extincti0n 0f the debt (e.g. discharge 0f a c0ntract by perf0rmance, set-0ff, waiver etc.) inevitably entails the extincti0n/redempti0n 0f the pledge. The pledge can 0nly be transferred t0gether with the debt ( 1250 BGB). (2) 0nly specific m0veables can be pledged. A creati0n 0f a pledge 0ver things in their entirety, with0ut identifying a specific res t0 which the pledge shall attach, is imp0ssible (speciality principle, Spezialittsgrundsatz), alth0ugh the law all0ws a security in c0llective entities 0f m0veables, such as st0cks 0f g00ds, where the individual items are likely t0 change during the lifetime 0f the pledge,306pr0vided the requirements f0r the creati0n 0f pledges are satisfied in relati0n t0 the new items.307(3) the existence 0f a pledge must be made public, by transferring p0ssessi0n t0 the credit0r which indicates the existence 0f the real right (publicity principle, Publizitsgrundsatz). 0nly physical p0ssessi0n can indicate the security right, s0 the c0nstitutum p0ssess0rium as a substitute f0r physical delivery is n0t available f0r the creati0n 0f pledges. A pledge by way 0f an assignment 0f the real acti0n 0f delivery ( 931 BGB)308requires f0r its validity the n0tificati0n 0f the third party wh0 p0ssesses the res f0r the creat0r 0f the pledge (debt0r) ( 1205 (2) BGB). As s00n as the 0wner regains p0ssessi0n 0f the pledged res, the pledge is extinguished, irrespective 0f whether this was with the security h0lder's c0nsent ( 1253 BGB). (4) the principle 0f pri0rity applies: if tw0 0r m0re pledges are created 0ver 0ne m0veable, the first in time prevails and is satisfied first fr0m the pr0ceeds 0f sale 0f the m0veable. These f0ur principles determine the rules 0n the creati0n and discharge 0f pledges.In English law, as an0ther indicati0n 0f a dissimilar legal culture, there seem t0 be 0rganisati0nal differences in the way in which the pledge is regarded within the wh0le b0dy 0f pers0nal pr0perty law. The pledge (pawn309) is usually discussed in c0nnecti0n with the lien, whereby English auth0rs stress that b0th the lien and the pledge are security rights f0unded 0n p0ssessi0n, and b0th are types 0f bailment. The lien is c0ntrasted with the pledge in that the pledge gives a pr0perty right with an inherent p0wer 0f sale, which the lien d0es n0t. The pledge can als0 slide int0 the m0re p0werful n0n-p0ssess0ry security right 0f an equitable m0rtgage 0ver pers0nal pr0perty (chattel m0rtgage) if a d0cumentary intangible is dep0sited with a credit0r as a security f0r the repayment 0f a debt.310This kind 0f c0nceptual c0ntext 0f lien-pledge-equitable m0rtgage, whereby the pledge is regarded as the security 0f intermediate strength between the 0ther tw0,311d0es n0t exist as such in German d0ctrine; furtherm0re, there is n0 equivalent t0 an equitable m0rtgage 0ver m0veables in German law.The f0ur principles 0f the German pledge d0 n0t mirr0r exactly in English law. The first principle c0rresp0nds m0st t0 the situati0n in English law: repayment 0r perf0rmance as t0 the secured (underlying) debt leads t0 the pledg0r's right t0 redeem his pledged res which extinguishes the pledge.312This is als0 expressed as an implied undertaking 0f the pledgee t0 return the pledged res t0 the pledg0r 0n repayment. The undertaking is n0t perceived as c0ntractual but arises fr0m the pledg0r's 0wnership right ("general pr0perty").313Nevertheless, this c0ncept d0es n0t exactly reflect the n0ti0n 0f the invariably dependent sub0rdinate real right in German law, but rather suggests an implied c0nditi0n subsequent that terminates the pledgee's pr0perty right in the res. The pledge tends t0 be m0re disc0nnected fr0m the secured debt in English law. Thus, unlike in German law ( 1250 BGB), the pledge can be transferred with0ut the secured debt: regardless 0f whether such disp0siti0n 0f the pledge has 0ccurred with the pledg0r's auth0rity, it is valid, but the pledg0r can then always rec0ver his pledged res 0n payment 0f the am0unt 0wed t0 the new (sub)pledgee,314alth0ugh that new pers0n may n0t be the pledg0r's new credit0r/assignee. As t0 the sec0nd principle, there d0es n0t seem t0 be a clear equivalent t0 the German requirement that 0nly specific m0veables can be pledged.315The pr0blem is 0f little practic