Securities in shipping finance transactions may be notarial and non-notarial, depending on how the security is entered into, whether before a notary or by simple private deed.
Mortgage is the most important among notarial securities (i.e. those entered into by public deed or certified private deed). This is because a mortgage provides the lender with the best guarantee for its credit. However, said types of securities include, besides mortgage, pledges over shares or pledges over quotas of the borrower.
In addition, there are other securities such as pledges over bank accounts, sureties and autonomous guarantees that are usually entered into by simple private deed.
With regard to non-notarial securities, there has always been the need to address the issue of how to give them a certified date pursuant to the Italian Civil Code. Indeed, if the security were not provided with a certified date, the consequences could be very serious for the lender. In the event of bankruptcy of the grantor (debtor or third-party guarantor), the lender would not be able to enforce said security against the receiver since the receiver would be a third party and said document would not be enforceable against the same if the certified date is missing. In fact, the receiver, when analyzing the claims that are entitled to the distribution of assets, could well object that said security cannot be enforced against the same. It would still be valid and effective against the parties (lender and security provider/grantor), but not enforceable against the receiver and all other bankruptcy creditors.
The problem is even more relevant when it comes to securities subject to English law, which are very frequent. In recent years, a number of securities have been introduced, some of which cannot be classified in a specific category of securities provided for under Italian law. In any case, they often have a handwritten date with no stamp or registration.
In relation to the certified date, the Italian Civil Code states in article 2704 that “the date of the private deed whose signature is not certified is not firm and is not enforceable against third parties, other than from the day on which the deed was recorded or from the day of death or supervening physical impossibility of the person, or of one of the persons, who signed it or from the day on which the content of the deed is reproduced in public deeds or, finally, from the day on which another event occurs that establishes in a way that is equally certain that the document was formed on a prior date".
With the expression “another event that establishes in a way that is equally certain that the document has a prior date” the legislator has created a residual category of facts or instruments suitable to affix a certified date to a document, whose suitability is left to the discretionary decision of the merit judge.
It is a prevailing view in case law that Article 2704 of the Italian Civil Code is a necessary implementing provision of our legal system. Therefore, if a security subject to foreign law were to be enforced in our legal system, said document should comply with the requirements of the mentioned Article 2704 of the Italian Civil Code.
The safest and most effective instrument for attributing a certified date to non-notarial securities is the notarial copy. The notary, in fact, should make a copy of the document and put his/her seal on such copy and declare that it is a “true copy of the original”. However, this is an “expensive” instrument from an economic standpoint for legal operators. In addition, notarial law sets limits on notarial copy, depending on the type of document presented.
With regard to the other instruments, it is not possible to have in advance the absolute certainty that they will be considered suitable by a judge, who will carry out a case by case analysis.
In the past, postal stamps were often used. Once the security document had been signed, it was taken to the nearest post office, where the first page was duly completed with the following wording: “This document is made up of no. pages and the postal stamp is required to certify the date”. The post office employee affixed the stamps necessary for the hypothetical shipment and stamped them with the date stamp.
Since 1 April 2016, the Italian Post Service has abolished the postal stamp. Therefore, legal practitioners had to resort to other instruments.
The first of them is the sending of the security document - duly signed and scanned - by certified e-mail. However, there is a problem with said instrument. It can be used for the purpose to affix a certified date if the text of the document is quoted in the text of the e-mail. However, if the document is scanned, uploaded and sent as pdf, sending the certified e-mail with the attached pdf document could lend itself to possible falsifications and manipulations. Indeed, it would be possible to attach to a certified e-mail a document named with the name of the guarantee, but in reality completely empty.
Another instrument is the registration with the Revenue Agency. A further instrument is the affixing of a revenue stamp on the document and the relevant cancellation of the revenue stamp before a municipal employee.
Said instruments, although suitable for giving reasonable certainty as to the date of the documents, have the disadvantage of being particularly time-consuming, since they require queuing at the competent public offices.
The newest instrument introduced is a digital time stamp. The document is uploaded to a portal of a specialist company and is digitally stamped. In order to verify whether the document corresponds to the one actually uploaded to the portal and digitally stamped, it will be necessary to submit the document to a verification procedure that the same IT company makes available on the portal.
This instrument is certainly quick because it is possible to use it from any computer, but it lends itself to the natural challenge relating to the reliability of the operating system made available by the IT specialist company. Not only. In a hypothetical trial, the truthfulness and reliability of the verification procedure should be demonstrated before the judge.
In relation to such latter instrument, recently introduced in the practice by legal operators, at this stage there are not yet judicial rulings and therefore there is still no certainty that it could be considered as an actually suitable instrument for the purpose of attributing a certified date. In practice, however, given its functionality and simplicity, this instrument has apparently already become the most widely used.
This article is for information purposes only and is not intended as a professional opinion. For further information, please contact Emanuele Caretti.
