THE CUBA REVIEW 13 



crops being harvested or crops gathered in the field, agricultural machinery and imple- 

 ments and cattle in general, but it is not necessary in this case, in order to legally con- 

 stitute the pledge security, that the things given in pledge shall pass into the hands of 

 the creditor, inasmuch as the debtor may continue in possession thereof until the ex- 

 piration of the obligation. In order that a contract thus entered into may have its 

 effects against third parties, it should be recorded at the Registry which is referred 

 to in the Law of March 2, 1922, and the same should be executed by public document 

 or by a private document with the Notarial certification of the signatures, and with a 

 clear indication of the security that is given. 



Credits thus recorded shall have preference over any other obligation of the debtor. 



83. If the date of maturity of the obligation shall arrive and the debtor fails to 

 tender payment, the creditor may request the Court of First Instance of the place 

 where payment was to be made, that he be placed in possession of the pledge, making 

 demand upon the debtor so that under the warning of punishable disobedience he shall 

 deliver over the security within the second day. The creditor shall also have the right 

 to demand, instead of the delivery of the pledge, that the same be sold in accordance 

 with what is provided in article 1872 of the Civil Code. 



84. The creditor bank with a pledge constituted either in its power or in that of 

 a third party, or in that of the debtor, which contract has been properly recorded in 

 the Registry, shall have a preferential right to collect its credit with the proceeds of 

 the pledge, over all other creditors except the following: (a) The government, the 

 Province or the Municipality for the last annuity of the tax corresponding to the 

 property given in pledge, (b) The insurer, for the premium of the insurance, (c) 

 Warehouses, for transportation expenses, warehouse charges and safekeeping. (d) 

 Other pignorative creditors in the order of the recording of their contracts in the 

 Registry. 



85. Banks of Agricultural Credit may make loans up to 70% of their subscribed 

 and paid in capital. 



86. The Banks of Agricultural Credit that are established according to this Law 

 shall not be obliged to pay taxes of any kind to the government, the Province or the 

 Municipality during the four years after their foundation and the contracts of loan 

 and any other proper operations which they have entered into shall also be exempt 

 from the payment of transfer taxes during that time. 



On Mortgage of Territorial Credit Banks 



87. Mortgage Banks are authorized to enter into the following transactions: (a) 

 To grant loans for a period not under five years nor in excess of forty, upon real estate 

 that is recorded in the Registry of Property; (b) To issue bonds or mortgage titles 

 and obligations. 



88. The loans shall be made upon mortgages on real estate recorded in the 

 Registry of Property in the name of the party constituting the same and they shall 

 be refunded by annuities. 



89. Loans may not exceed in any case one half of the value of the real property 

 on which the mortgage has been placed, the by-laws of the bank to determine the 

 bases according to which properties shall be assessed. 



90. The amount of the interest coupon and the percentage of annual amortization 

 may not exceed the amount of the annual liquidated rental of the property estimated 

 on the basis of the five years preceding the loan. 



91. The bank may issue, up to the amount of the sums loaned with mortgage 

 security, mortgage titles or bonds in an amount not in excess of said mortgages, with 

 the obligation of paying up said mortgage bonds on fixed dates or by drawings. 



92. The bank is also obliged to retire the titles or mortgage bonds from circula- 

 tion to the extent that the mortgages are being released; and if a debtor should pay the 

 whole or part of his debt before maturity, the obligations, titles or mortgage bonds shall 

 be retired from circulation in an amount equal to the sum reimbursed. 



