Rights in security

This chapter is concerned with rights in security for the repayment of debt. A right in security confers a legal right which a creditor may enforce should the debtor fail to pay the sum(s) owed. A right in security
exists in tandem with, but is distinct from, a creditor’s right of action against a debtor under any contractual obligation to repay the debt. Rights in security can be subdivided into personal rights, which are traditionally known as cautionary obligations and real rights. This chapter begins by outlining the key differences between the two types of right. It then explains how a cautionary obligation is constituted and how it operates. It details real rights in security over heritage (land and buildings) and moveable property. Moveable property may be either corporeal, something that has a physical existence and can be moved from one place to another, or incorporeal, for example shares in a company, the existence of which may be proved by the issue of a share certificate but otherwise has no tangible existence.