Book2 Chapter05

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 V. Assumption of Debt.

Section 414.

• A debt may be assumed by a third party by contract with the creditor in such manner that the third party takes the place of the former debtor.

Section 415.

• [I] If the assumption of the debt is agreed upon by the third party and the debtor it is invalid, unless ratified by the creditor. Ratification may not take place until the debtor or the third party has informed the creditor of the assumption of the debt. Before ratification the parties may modify or rescind the contract.
• [II] If ratification is refused, the assumption of the debt is deemed not to have been effected. If the debtor or the third party demands the creditor to declare whether or not he will ratify within a fixed period of time, ratification may be declared only before the expiration of the period; if it is not declared, it is deemed to have been refused.
• [III] So long as the creditor has not ratified the person assuming the debt is, in case of doubt, bound to the debtor to satisfy the creditor in due time. The same rule applies if the creditor refuses to ratify.

Section 416.

• [I] If the grantee of a piece of land, by contract with the grantor, assumes a debt of the grantor for which there is a hypotheca on the land, the creditor may ratify the assumption of the debt only if the grantor communicates it to him. If six months have elapsed since receipt of the communication, ratification is deemed to have been given, unless the creditor has refused it to the grantor within such period ; the provision of 415, par. 2, sentence 2, does not apply.
• [II] The communication may not be made by the grantor until after the grantee has been registered in the land register as owner. It must be made in writing and contain reference to the fact that the person assuming the debt takes the place of the former debtor, unless the creditor declares his refusal within six months.
• [III] The grantor shall, on demand by the grantee, communicate to the creditor the assumption of the debt. As soon as the question whether to ratify or not is settled the grantor shall notify the grantee.

Section 417.

• [I] The person assuming the debt may set up against the creditor all defences arising from the legal relations between the creditor and the former debtor. He may not set off a claim belonging to the former debtor.
• [II] The person assuming the debt may not set up any defences against the creditor arising from the legal relations between himself and the former debtor upon which the assumption of the debt is founded.

Section 418.

• [I] In consequence of the assumption of a debt the liability of sureties and pledges given for the claim are extinguished. If there is a hypotheca for the claim, the consequence is the same as if the creditor had relinquished the hypotheca. These provisions do not apply if the surety or the person to whom the object pledged belongs at the time of the assumption of the debt consents to such assumption.
• [II] A right of preference connected with the claim in case of bankruptcy may not be enforced in the bankruptcy proceedings instituted against the property of the person assuming the debt.

Section 419.

• [I] If a person takes over the whole of another's property under a contract, the creditors of the latter, without prejudice to the continuance of the liability of the transferor, may, after the conclusion of the contract, enforce their claims existing at that time even as against the transferee.
• [II] The liability of the transferee is limited to the value of the property transferred and the claims which he has under the contract. If the transferee sets up any such limitation of liability, the provisions of 1990, 1991, applicable to the liability of an heir apply mutatis mutandis.
• [III] The liability of the transferee may not be excluded or limited by agreement between him and the former debtor.