On the Right of Private Property

All-Russian Central Executive Committee, The Right of Private Property in Commerce and Industry. May 22, 1922


Decree of the Third Session of the Ninth All-Russian Central Executive Committee, On the Right of Private Property, as Recognized by the RSFSR, Protected by its Laws and Maintained by its Courts

With the object of establishing exact relations between State organs and associations or private persons participating in the development of the productive forces of the country, and the relations of private persons and combinations between each other, and with the purpose of fixing the consequent legal guarantees necessary for the maintenance of the property rights of citizens of the RSFSR and foreigners, the All-Russian Central Executive Committee resolves:

1. To permit all citizens, whose rights are not limited by law established, upon the territory of the RSFSR and her Allies and the Soviet Republics united with her by treaty, the right of organizing industrial and commercial undertakings and of pursuing trades and professions permitted by the laws of the RSFSR, provided that all regulations regarding industry and trade and the protection of labor are observed.

II. To permit all citizens, whose rights are not limited by law established, the following rights of property which shall be defended by the courts of law:

A. Property

(1) The right to the possession of buildings in town or country not nationalized by the local Soviets together with the right of transferring such buildings with the lease of the site on which the transferred buildings stand.

Note. The right of transferring leases does not apply to cultivated lands in country districts.

(2) The right, by agreement with the local authorities concerned with the disposal of land, of building upon urban and country sites for a period fixed by law, but not exceeding forty-nine years, with the right to the possession of the buildings during this period as mentioned in the previous clause.

(3) The right to the possession of movable property connected with factories, workshops, commercial and industrial undertakings, private ownership of which is permissible, tools and the means of production, the products of agriculture and industry, commodities not withdrawn from circulation by special legislation, financial capital, articles of domestic utility and articles of personal use.

Note. The requisition of property mentioned in Clauses 1, 2, and 3 of the present decree against payment for the alienated property at average market prices within a period of one month, and confiscation without compensation, are permissible only in special circumstances established by law.

(4) The right to mortgage or pledge property mentioned in Clauses 1, 2, and 3 of the present decree.

(5) The right to inventions, copyright, trademarks, and industrial models and drawings within the limits established by special legislation.

(6) The right of inheritance, by testament or law, by husbands or wives or direct offspring, to the limit of 10,000 gold rubles in total value.

Note. Exception to this clause are permissible only in circumstances established by special legislation.

B. Contracts

(7) The right to conclude all manner of contracts, including those relating to the leasing of property, purchase and sale, barter, lease, loans, tender, power of attorney, insurance, partnership (simple, complete, in trust, and limited liability), bills of exchange and all kinds of banking and credit operations, which agreements shall receive the force of law and shall be maintainable in a court of law in accordance with the following conditions:

(a) All agreements not forbidden by law concluded between (1) State organs and persons, (2) legally qualified citizens, and (3) legal entities, to the limits defined in their constitutions, shall be considered obligatory upon the parties to the contract, and shall give them the right to the legal defense of claims arising therefrom.

Note. A clause inserted in a contract forbidding either of the parties to resort to the courts of law shall render that contract invalid.

(b) Contracts shall be invalid which: (1) are concluded by persons not legally qualified; (2) are contrary to the law, or whose object is to defeat the law; (3) are from the transfer of right-, to commodities withdrawn from circulation; (4) are concluded without due observance of the forms laid down by law; or (5) are clearly prejudicial to the State.

(c) The courts may consider contracts fully or partially invalid at the request of one of the parties, in the following circumstances: (1) if one of the parties entered into the contract under the influence of fraud, threats, or violence, or as a result of collusion; (2) if one of the parties entered into the contract under a misapprehension of a fundamental nature.

Where one of the parties takes advantage of the dire necessity of the other party for the purpose of usurious exploitation, the court may at the request of the aggrieved party or the ate authorities, either declare, the contract invalid or annul it for the future.

The rights of property and obligations mentioned in Sections I to 7 apply also to all bodies recognized as legal entities, as, for example, producing and cooperative organizations, partnerships, registered companies, State institutions and undertakings, and their combinations to the limit laid down in their constitutions or in corresponding regulations. Note 1. Foreign limited liability companies, partnerships, etc., may enjoy the rights of legal entities in the RSFSR only with the permission of the appropriate organs of the Council of People’s Commissars.

Note 2. Foreign legal entities which have not received permission to conduct activities in the RSFSR may enjoy legal defense of claims arising outside the frontiers of the RSFSR against persons residing within the frontiers only where such right is mutual. IV. Disputes as to the rights of citizenship shall be settled by the courts of law.

V. The present decree is not retroactive, and does not confer the right on former owners of property which had been expropriated in accordance with revolutionary law before the promulgation of the present decree to claim the return of such property.

VI. The ARCEC requests the Presidium of the ARCEC and the Council of People’s Commissars to draw up the necessary detailed laws arising out of the present decree and to submit to the next ordinary session of the ARCEC a draft Code of the Civil Laws of the RSFSR.

Source: Russian Information and Review. Vol. I, No. 20 (15 July 1922), pp. 478-479.


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