Article 785 — Exclusive Right of Secured Creditors

1/ Creditors secured by rights in rem over specified assets, including by pledges and mortgages, shall have an exclusive right on the realization value of the encumbered assets, after deduction of costs and expenses for the realization of such encumbered assets. 2/ The residual portion of pre-insolvency claims not covered by such net realization value shall be treated as unsecured claims.