Facts

The plaintiffs, artisans, worked on a construction project in Zurich, which was completed in the spring of 1954. Two of them obtained a provisional registration of their lien rights before the owner's bankruptcy, while the others obtained provisional registrations after the bankruptcy. The plaintiffs' claims were recognized in the allocation plan, but the defendants, prior-ranking mortgage creditors, contested the validity of the lien rights. The plaintiffs brought a warranty action against the defendants under Article 841 of the Swiss Civil Code (CC), but the lower courts dismissed their claim due to the lack of final registration of their lien rights.

The key facts of the case are as follows

  • The plaintiffs worked on a construction project in Zurich, which was completed in the spring of 1954.
  • Two of the plaintiffs obtained a provisional registration of their lien rights before the owner's bankruptcy.
  • The other plaintiffs obtained provisional registrations after the bankruptcy.
  • The plaintiffs' claims were recognized in the allocation plan.
  • The defendants, prior-ranking mortgage creditors, contested the validity of the lien rights.

Considerations

The Federal Court examined the applicable legal provisions, in particular Article 841 of the Swiss Civil Code (CC) and Articles 837, 799, and 961 of the same code. It also took into account the provisions of the Bankruptcy Act (SchKG) and the Act on Lien Rights (LRO).

The Federal Court considered that the provisional registration of a lien right before the owner's bankruptcy is sufficient to allow artisans to assert their claims in case of loss during the realization of their lien. It also decided that the defendants, prior-ranking mortgage…