Dutch Civil Code

Book 7 Particular agreements

Title 7.2D Contract of pawn*)

*) The text of title 7.2D has been accepted, but is not yet in force.

Article 7:130 Definition of a contract of pawn*)
- 1. A contract of pawn is a contract under which one of the parties, the pawnbroker, puts a sum of money at the disposal of the other party, the pawner, and the latter, in his turn, brings a movable thing, not being registered property, into the power of the pawnbroker, under the stipulation:
a. either that the pawnbroker shall give the thing back to the pawner if the latter, within the loan period, has repaid the sum of money in full to the pawnbroker and has completely paid the pawn charges, or that the pawnbroker becomes the owner of the thing if, within the loan period, full repayment of the loan and full payment of the pawn charges fail to occur;
b. either that the pawner immediately transfers the ownership of the thing to the pawnbroker, yet under the obligation of the pawnbroker to give the thing back to the pawner if the latter, within the loan period, has repaid the sum of money in full to the pawnbroker and has completely paid the pawn charges.
- 2. The present Title (Title 7.2D) applies as well to every contract purporting the same as a contract of pawn meant in paragraph 1, regardless of the form or name it is entered into.

*) The contract of pawn is not covered by Directive 2008/48/EC on credit agreements for consumers, not even if it is a contract as referred to in Article 7:130, paragraph 1, under (a). This follows from Article 2, paragraph 2, under (k), of the Directive. The contract of pawn is neither covered by Title 7.2A of the Dutch Civil Code, regarding credit contracts for consumers, where that Directive has been implemented into the Dutch Civil Code. This follows from Article 7:58, paragraph 2, under (i). Because any loss is borne according to Article 7:139 by the pawnbroker, whereas the pawner cannot have an outstanding debt, the pawner’s liability is strictly limited to the pawned thing. From this follows also that the Consumer Credit Act is not applicable either. According to Article 2 of that Act, this Act has the same scope as title 7.2A DCC.

Article 7:131 Other definitions
In the present Title (Title 7.2D) the terms below shall have the following meaning:
a. ‘pawnbroker’: a natural person or legal person who, in the conduct of his professional practice of business, offers loans under pawn;
b. ‘loan period’: the period of time agreed upon in the contract of pawn within which the pawner has to repay the sum of money that is put at his disposal and has to pay the pawn charge, before the pawnbroker is obliged to give the thing back to the pawner;
c. ‘pawn charges’: all rewards and compensations, in any form whatsoever, which the pawnbroker charges or receives within the framework of the contract of pawn;
d. ‘month’: a calendar month or a period between a day in a calendar month and the according day of the next calendar month.

Article 7:132 Pawner is a non-professional natural person
The present Title (Title 7.2D) is applicable only if the pawner is a natural person who [when entering into the contract of pawn] does not act in the conduct of a professional practice of business.

Article 7:133 Information to be provided prior to the conclusion of the contract
Without prejudice to what is provided in Articles 6:193c up to and including 6:193e, the pawnbroker shall enable the pawner, before the latter is bound by the contract of pawn, to take knowledge of the following information:
a. the pawn charges per month expressed in a percentage of the sum of money put at the disposal;
b. the duration of the loan period.

Article 7:134 Formal requirements for the contract and its content
- 1. The contract of pawn is entered into on paper or another durable data carrier. The pawnbroker shall provide the pawner with a specimen of the contract of pawn and shall keep one specimen thereof itself.
- 2. The contract of pawn specifies short and clear:
a. the identity and geographical addresses of the of the pawner and pawnbroker and of possible intermediaries;
b. a description of the pawned thing;
c. the sum of money put at the disposal of the pawner;
d. the duration of the loan period;
e. the stipulation referred to in Article 7:130, paragraph 1, under (a) or the stipulation referred to in Article 7:130, paragraph 1, under (b);
f. the pawn charges per month expressed in a percentage of the sum of money that is put at the disposal and the way in which these charges have been calculated;
g. the total amount that the pawner must pay within the loan period to have the right to claim that the thing is given back to him, under the presumption of payment of that amount on the last day of the loan period and with mention of the way in which that amount is calculated in the event of an earlier payment;
h. the conditions under which and the way in which the loan period may be extended;|
i. the right of the pawner to claim the immediate return as referred to in Article 7:135, paragraph 2;
j. further conditions applicable to the contract.

Article 7:135 Loan period/right to claim the return of the pawned thing
-1. The loan period is at least two months.
- 2. During the loan period and, in case of an extension thereof, during the extended loan period, the pawner at all times has the right to claim the immediate return of the pawned thing against repayment of the sum of money put at his disposal and the payment of all pawn charges.

Article 7:136 Pawner regains ownership by operation of law
If the stipulation referred to in Article 7:130, paragraph 1, under (b), has been made in a contract of pawn, then the full repayment of the sum of money and the full payment of the pawn charges have the result that the pawner by operation of law acquires the ownership of the pawned thing again as if the transfer to the pawnbroker was performed under a condition subsequent of that repayment.

Article 7:137 Calculation of the pawn charges
The pawn charges are calculated in the form of a monthly interest of at the most a percentage set by Order in Council of the sum of money referred to in Article 7:130, paragraph 1.

Article 7:138 Applicability of the provisions regarding pledge
The provisions regarding a pledge on movable things apply to a contract of pawn referred to in Article 7:130, paragraph 1, under (a), except for the Articles 3:233, 3:234, 3:235, 3:237, 3:241, 3:242, 3:243, paragraph 2, 3:244, 3:248, 3:249, 3:250, 3:251, 3:252, 3:253, 3:254 and 3:256.

Article 7:139 Loss suffered by the pawnbroker*
If the pawner does not repay the sum of money in full within the loan period and does not pay the pawn charges in full, then the pawnbroker bears the loss he suffers in comparison to the sum of money and the pawn charges referred to in Article 7:130, paragraph 1.

*) This rule is essential for a contract of pawn, because the absence of a residual debt, in the sense that the liability of the pawner is in any event strictly limited to the (value of the) pawned thing, prevents that the contract of pawn has to be regarded as a consumer credit contract.

Article 7:140 Mandatory law
It is not possible to derogate from the present Title (Title 7.2d) to the detriment of the pawner.