The Right of Ownership
The provisions referring to the right of ownership, its contents, and its protection are relatively few. The Civil and Commercial Code offers more space, instead, to the ownership of immovable property. This difference indicates that, in the intention of the legislator, the provisions on the right of ownership flow mainly from the set of rights related to land.
Under Section 1336 of the Civil and Commercial Code the main elements of ownership are use, disposal, and enjoyment of fruits. In particular, the Code states that the owner of property has the right to use and dispose of it and acquire its fruits within the limits of the law. “Use” indicates here the right to make use of the property while “disposal” is a term that means to take material decisions (e.g., transform the property or destine it to a certain use) as well as legal decisions on the property (e.g., modify the legal status such as sell the property, rent it out, donate it, etc.). “Enjoyment” refers to the possibility of taking any utility from the property, either by collecting the natural fruits yielded by the property or by collecting the legal fruits from the person with whom a right of enjoyment of the property has been established. In other words, the owner is free to do whatever he wants with his property within the limits established by the law.
The right of ownership is perpetual. This means that it is not subject to any limitation in time. However, the inactivity of the owner entitles the person who possessed the property for a specific period of time, to acquire the right of ownership as a consequence of continuing possession. This type of acquisition of ownership will be discussed in detail below with possession.
Acquisition of Ownership
In the past, ownership represented one of the main areas of private law and the first civil codes were exclusively applied to property, acquisition of property, and persons with rights to property. Acquisition of ownership was largely based on contracts and succession by death. Property could be transferred to the family principally through succession by law and succession under a will. The family, therefore, was considered as a way to acquire and increase the property.
Contracts represent the main mode of acquiring property. This explains the reason why the contract of sale constitutes one of the most common and well-known types of contract.
In the same way, property can be acquired by succession. When a person dies, he can no longer own property or exercise rights over property. Therefore, property of the deceased is subject to succession, that is, it must pass on to his survivors.
Contracts and succession are methods of acquiring ownership by assignment. This means that the right to be acquired already exists and is transferred from one individual to another. It must be noted, however, that there are other methods of acquiring property by creating a new right as will be discussed below. In such cases, the right is not transferred but it is created as new.
Possession
One of the most important means of acquiring a right that did not previously exist is by continued possession, physical occupation of the property beyond the lapse of a certain period of time. Specifically, ownership of property belonging to another person can be gained by possession of it for a prescribed period of time ranging from five years in the case of movable property to ten years in the case of immovable property (Section 1382 Civil and Commercial Code).
Occupancy
Another very common way of acquiring property is through occupancy (Section 1318, Civil and Commercial Code) which consists of taking possession of ownerless movable property, unless the occupation is forbidden by law or is in violation of another person’s right to occupation of such movable property.
More precisely, wildlife is considered as the common property of all. Subject to special laws and regulations, a person who catches a wild animal on waste lands or in public waters, or, without opposition of the owner, on private lands or in private waters, becomes its owner (Section 1321, Civil and Commercial Code).
Lost property must be handed in to the loser or, if the loser is unknown, to the police. If not reclaimed within a year it becomes the finder’s property. Acquiring property in this way is known as finder’s right (Section 1325, Civil and Commercial Code). If the original owner subsequently claims the property, the finder is entitled to a reward.
Treasure is regulated by specific rules. Treasure is defined as movable property of value “which has been hidden or buried, which no person can prove ownership of” (Section 1328, Civil and Commercial Code). The treasure becomes the property of the State. The finder, however, is entitled to receive a reward of one-third of its value.
Alluvion
Accretions of land which are formed gradually and imperceptibly alongside rivers and torrents belong to the landowner by alluvion (Section 1308, Civil and Commercial Code). Alluvion, thus, is a form of acquisition of ownership without any act being done by the acquirer. An example is soil carried by a river from one bank to another. It must be noted, however, that islands formed in a lake or waterway in territorial waters and beds of water left dry are considered as property of the State (Section 1309, Civil and Commercial Code).
Accretion
As the ownership of land extends above and below the surface, anything constructed or erected and located below or above the ground, even if put there by a person in good faith, belongs to the landowner by virtue of accretion (Sections 1310 and following, Civil and Commercial Code). If the work is made in good faith and there is negligence of the owner, however, the landowner must pay the constructor for the increase of the value of the land.
It must be noted that if the work is made in bad faith, the landowner can choose to keep the land under payment of a sum or to demand the constructor to put the land in its former condition (Section 1311, Civil and Commercial Code). The same rules apply to any kind of work which is fixed to the land or planted on it (Section 1314, Civil and Commercial Code). These rules were very important in the past, but are much less so nowadays.
Connection
When several movables belonging to different persons become joined but can still be separated without undue damage, each person becomes a co-owner and has the right to require separation. In cases where it is not possible to reasonably separate the composite thing, it becomes common property in shares proportional to the value of each movable at the time of its being joined with the other movable (Section 1316, paragraph 1, Civil and Commercial Code).
However, if one of the movables can be regarded as the principal thing, its owner becomes owner of the whole by connection but must pay the value of the former movables to their respective owners (Section 1316, paragraph 2, Civil and Commercial Code). Hence, the traditional rationale underlying this approach lies in public policy concerns; the legislator intends to prevent the destruction of a thing that is created through connection by reassigning the legal relations. Thus, in case of fusion between A’s gold with B’s silver, A will become the owner of the alloy but she has to pay B the value of the silver.
Specification
In the present context, specification (Section 1317, Civil and Commercial Code) is probably among the most relevant means of acquisition of ownership. The Civil and Commercial Code provides that if a person has worked on materials belonging to another person to create a new object, ownership remains with the owner of the materials who must pay the value of the work carried out. In these cases, a new “species” or thing is made out of a pre-existing thing through a process of manufacture or transformation. For example, A may make wine, or oil, or corn, out of B's grapes, olives, or sheaves; or a vessel out of her gold, silver or bronze; or mead of her wine and honey; or cloth out of her wool; or a ship, a chest or a chair out of her timber. Thus, if A crochets a sweater by using B’s cashmere wool, B will be the owner of the sweater but he must pay A the value of the work carried out. Similarly, if A bakes bread with B’s flour, B will be the owner of the loaf of bread but she has to pay A the value of the work.
If, however, the value of the manufacturing or transformation is substantially higher than that of the materials used, the maker or creator becomes the new owner on paying the former owner the value of the materials used. Such is the case of a painter who uses another person’s colors and canvas to paint a portrait or an artist who carves a sculpture from a block of marble belonging to someone else.
For advice and guidance regarding Thai law, please consult our legal expert in Bangkok and Chiang Mai.