Legal Definitions - constitutum possessorium

Constitutum possessorium describes a legal situation where the ownership or legal possession of an item is transferred from one person to another, but the original owner or possessor retains physical custody of the item. This transfer occurs through an agreement where the original holder acknowledges they are now holding the item not for themselves, but on behalf of the new owner. It is a form of "constructive delivery," meaning the legal transfer of possession happens without the item physically moving from one person's hands to another's.

• Example 1: Sale of a Vehicle with Temporary Retention

  Imagine Sarah sells her classic motorcycle to her friend, Tom. However, Sarah needs the motorcycle for a charity ride scheduled for the following weekend. They agree that the motorcycle is legally Tom's as of today, but Sarah will keep it in her garage and ride it for the charity event, after which she will deliver it to Tom.

  How it illustrates the term: In this scenario, Sarah (the transferor) retains immediate physical control and custody of the motorcycle. Tom (the transferee) gains legal possession and ownership. The agreement between them establishes that Sarah is now holding the motorcycle on Tom's behalf, even though it hasn't physically moved from her possession.

• Example 2: Art Sale with Immediate Loan-Back

  A private art collector, Mr. Davies, sells a valuable sculpture to a prominent art museum. As part of the sales agreement, the museum immediately loans the sculpture back to Mr. Davies for a special exhibition at his private gallery, which is scheduled to run for the next three months.

  How it illustrates the term: The museum (the transferee) becomes the legal owner of the sculpture. Mr. Davies (the transferor) retains physical custody and displays the sculpture, but he does so as a borrower or bailee for the museum, acknowledging the museum's ownership, rather than holding it as his own property.

• Example 3: Business Equipment Sale-Leaseback

  A manufacturing company, "InnovateTech," needs to raise capital. To do so, they sell their specialized production machinery to a financing company, "Capital Solutions." Immediately after the sale, Capital Solutions leases the machinery back to InnovateTech under a long-term agreement, allowing InnovateTech to continue using the equipment in its operations.

  How it illustrates the term: InnovateTech (the transferor) physically keeps and operates the machinery in its factory. Capital Solutions (the transferee) becomes the legal owner of the machinery. InnovateTech now holds and uses the machinery under a lease agreement, acknowledging Capital Solutions' ownership, even though the machinery never left InnovateTech's premises.