(1) If a person pledges any of his goods and takes a loan from more than one creditor once or several times, and if the pledged goods are not sufficient to repay the debts of all the creditors, unless otherwise stipulated in the contract, all the creditors who have pledged the goods for such security shall be liable to the outstanding debt. It will be considered to be in the same (pari passu) position and all the creditors will have a proportional claim on such item.
(2) In accordance with sub-section (1), the agreement entered into with the mortgage will be void so that the other creditor will have priority over the item that has been mortgaged. If the creditor, knowing that there are other creditors in relation to such debt, has recovered the debt from such mortgage before the cancellation of such agreement, then such amount shall be returned to the other creditor and recovered from other rights of the mortgagor.