Transformation of the Institution of Pledge of Movable Property: Problems of Qualification of the Loss of the Pledged Item after a Traffic Accident without a Disposal Procedure and Judicial Practice

<jats:p>The study is aimed at identifying general trends in the enforcement of rules on securing obligations in conditions of high key interest rates and economic uncertainty. In a commercial dispute, the court refused to reduce the penalty, emphasizing the inadmissibility of profiting from non-payment by a business entity where the penalty rate is considered as the market value of capital. In the civil case of the eviction of a family with children, the court confirmed the priority of the interests of the mortgagee, Sberbank PJSC, by authorizing the sale of the only housing at public auction at a discount of 20% of the market value to ensure the liquidity of the auction. A comparison of these cases demonstrates the universality of the principle of the security function of a pledge and a penalty: the courts consistently refuse to protect debtors unless the absolute impossibility of execution or an obvious abuse of the right on the part of the creditor is proven. The article substantiates the thesis that the modern Russian judicial system has transformed into an instrument of strict enforcement of contracts, minimizing judicial discretion in applying Article 333 of the Civil Code of the Russian Federation and strictly following the formal criteria for foreclosure on real estate in accordance with the law “On Mortgages”.</jats:p>