REIT Under the Civil Law
What is the Civil Law, and How Does it affect REIT? Their world has two main legal structures, the civil law and the common law. In simple terms, civil law is a pre-written legal code that was made by the lawmakers; judges simply apply these codes rather than interpreting past decisions (Basically, judges don't make decisions based on old court cases or interpreting them in any way, but rather based on a pre-written rule book). Property law under the civil law saw property as a bundle of rights over lots of things, including ownership over property, usufruct (right to use property and earn income from it), lease, servitudes (right of land), and mortgage. Under civil law, property ownership is absolute, held by only one party, and it does not recognize the 'splitting' of ownership. REIT, on the other hand, is structured with two separate legal entities owning a piece of property. The trustee (REIT company) holds the legal title to the property, and the investors (unitholder...
