Legal Analysis of Gift Revocation, Third-Party Beneficiary Rights, and Priority of Claims over Mortgaged Immovable Property under Thai Civil and Commercial Law
Issue 1: Revocation of a Registered Gift of Land and Third-Party Beneficiary Rights
Mr. Chan executed a registered gift of 8 rai of titled land to his son, Mr. Angkarn, for agricultural use. The gift agreement required Angkarn to subdivide 2 rai, as specified in the attached plan, and transfer it to Mr. Phut, Chan’s adopted son, with Phut bearing the subdivision costs. Angkarn refused to comply and verbally insulted Chan.
Under the Civil and Commercial Code, revocation of a completed gift is permitted only on limited statutory grounds. Mere ingratitude expressed through insulting words does not constitute serious misconduct sufficient to revoke the gift (cf. Supreme Court precedent No. 104/2520). Accordingly, Chan has no right to revoke the gift.
However, Phut, as a third-party beneficiary under Section 374 CCC, has clearly declared his intention to avail himself of the benefit. He is therefore entitled to demand performance, namely the transfer of the 2 rai in accordance with the contract.
Issue 2: Priority of Claims over Mortgaged Immovable Property
Mr. Daeng sold a house and land to Mr. Dam for 500,000 Baht, receiving 400,000 Baht upfront. The remaining 100,000 Baht was outstanding. Mr. Khao registered a statutory contractor’s lien for construction works (80,000 Baht), which increased the property value by 50,000 Baht. Subsequently, Dam mortgaged the property to Mr. Khiao for 400,000 Baht.
Upon enforcement:
- Khao, as contractor, has first priority, limited to the amount by which the immovable property increased in value (50,000 Baht).
- Daeng has second priority for the unpaid purchase price.
- Khiao, as mortgagee, ranks third for 400,000 Baht.
Distribution shall follow this statutory order of preference.