Book2 Chapter02 Title05

GERMAN CIVIL CODE OF 1896

• Based on the English Translation by: Wang, Chung Hui (1907). The German Civil Code, translated and annotated with historical introduction and appendices. London: Stevens and Sons. [available on Archive.org]

BOOK II. Law of Obligations.

Chapter II. Obligations Ex Contractu.

Title V. Rescission.

Section 346.

• If in a contract one party has reserved to himself the right of rescission, and if rescission takes place, the parties are bound to return to each other the consideration received. For services rendered and for allowing the use of a thing the value shall be made good, or, if in the contract a counter-payment in money is stipulated for, this shall be paid.

Section 347.

• The claim to compensation on account of deterioration, destruction or impossibility of delivery arising from any other cause is determined, in case of rescission, and after receipt of the consideration, according to provisions which apply to the relation between an owner and a possessor after the date of action commenced on a claim of ownership. The same rule applies to the claim for delivery of, or compensation for emoluments, and to the claim for reimbursement of outlay incurred. A sum of money bears interest from the time of its receipt.

Section 348.

• The obligations of the parties resulting from rescission shall be fulfilled contemporaneously. The provisions of 320, 322, apply mutatis mutandis.

Section 349.

• Rescission is effected by declaration to the other party.

Section 350.

• The right of rescission is not barred by the fact that the object which the party entitled to rescind has received has been accidentally destroyed.

Section 351.

• The right of rescission is barred if the party entitled is to blame for any essential deterioration, destruction, or impossibility for other reasons of delivering the object received. The destruction of a considerable part is equivalent to the essential deterioration of the object; the fault of another person for which, according to 278, the party entitled is responsible is equivalent to his own fault.

Section 352.

• The right of rescission is barred if the party entitled has altered the form of the object received by working up or remodelling into a thing of another kind.

Section 353.

• [I] If the party entitled has alienated the object received or a considerable part of it, or has charged it with a right in favour of a third party, the right of rescission is barred if the conditions of 351 or of 352 have arisen in the case of the party who has acquired the object in consequence of the disposition.
• [II] A disposition which is effected by means of compulsory execution or distraint, or by a trustee in bankruptcy, is equivalent to a disposition of the party entitled.

Section 354.

• If the party entitled is in default with the return of the object received or of a considerable part of it, the other party may allot him a fixed reasonable period with a declaration that he refuses to accept after the expiration of the period. The rescission becomes ineffective if the return is not made before the expiration of the period.

Section 355.

• If a period for the exercise of the right of rescission has not been agreed upon, a reasonable period for its exercise may be allotted to the party entitled to it by the other party. The right of rescission is extinguished if rescission is not declared before the expiration of the period.

Section 356.

• If in a contract there are several persons on the one or the other side, the right of rescission may be exercised only by all and against all. If the right of rescission is extinguished in respect of one of those persons entitled, it is extinguished also in respect of the others.

Section 357.

• If one party has reserved the right of rescission for the case of the other party not fulfilling his obligation, the rescission is ineffective if the other party could have relieved himself from the obligation by set-off, and makes & declaration of set-off without delay after the rescission.

Section 358.

• If one party has reserved the right of rescission for the case of the other party not fulfilling his obligation, and the latter contests the admissibility of the declared rescission on the ground that he has fulfilled it, he shall prove fulfilment unless the performance due from him consists in a forbearance.

Section 359.

• If the right of rescission is reserved on payment of a forfeit, the rescission is ineffective if the forfeit is not paid before or at the time of the declaration of rescission, and the other party without delay rejects the declaration for this reason. The declaration is, however, effective if the forfeit is paid without delay after the rejection.

Section 360.

• If a contract is entered into with the proviso that the debtor shall forfeit his rights under the contract if he does not fulfil his obligation, the creditor is entitled to rescind the contract on failure of the debtor so to fulfil it.

Section 361.

• If it is agreed in a mutual contract that the performance due from one of the parties shall be effected exactly at a fixed time or within a fixed period, it is to be presumed, in case of doubt, that the other party shall be entitled to rescind if the performance is not effected at the fixed time or within the fixed period.