At the debtor’s request, the composition court may suspend the realisation of mortgaged property in settlement of a claim that arose before the composition proceedings were initiated for a maximum of one year after confirmation of the composition agreement, provided that no more than one year's interest on the mortgaged debt is outstanding. However, the debtor must credibly demonstrate that he needs the property to operate his business and that realisation of the mortgaged property would jeopardise his economic existence.
The affected mortgagees must be given the opportunity to submit a written response before the hearing on the confirmation of the composition agreement (Art. 304); they must be summoned in person to the creditors’ meeting (Art. 302) and to the hearing before the composition court.
The suspension of the realisation proceedings lapses by operation of law if the debtor voluntarily alienates the mortgaged property, if he becomes bankrupt or if he dies.
The composition court shall revoke the suspension of the realisation proceedings at the request of an affected creditor and after hearing the debtor if the creditor can credibly demonstrate that:
the debtor has obtained the suspension by providing false information to the composition court; or
the debtor has acquired new assets or income from which he can pay the debt for which he is subject to debt enforcement without jeopardising his economic existence; or
the economic existence of the debtor is no longer jeopardised by the realisation of the mortgaged property.
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