LAW OF OBLIGATION ACT, CHAPTER 3, DEVISION 1

Chapter 3

PLURALITY OF PERSONS IN OBLIGATIONS

Division 1

Plurality of Obligors

  • 63. Joint obligors

(1) If several persons are to perform a divisible obligation, they shall perform the obligation in equal shares. The law or a transaction may prescribe that several obligors shall perform an obligation in unequal shares.

(2) The provisions of subsection (1) of this section do not apply if several persons are to perform an obligation as solidary obligors.

  • 64. Collective obligors

If several persons are to perform the same obligation and they can perform such obligation only collectively, the obligee shall require them to perform the obligation collectively.

  • 65. Solidary obligors

(1) If several persons are to perform an obligation jointly and severally (solidary obligors), the obligee may require full or partial performance of the obligation from all the obligors collectively, from any one obligor or from some of the obligors separately.

(2) A solidary obligation arises if several persons are to perform an obligation with the same content and performance of the obligation may be required by the obligee only once, and in other cases provided by law or on the basis of a transaction.

(3) A solidary obligation also arises if an obligation is indivisible.

(4) If several persons undertake by a contract to perform an obligation collectively, it is presumed that they are solidary obligors.

  • 66. Waiver of claim

(1) If an obligee wholly or partially waives a claim against a solidary obligor, the other solidary obligors are nevertheless required to perform the obligation in full.

(2) If an obligee reaches an agreement with a solidary obligor that the obligee will waive the obligee’s claim against all of the solidary obligors, the other solidary obligors are also released from the obligation. A solidary obligor may, on behalf of the other solidary obligors, accept a proposal from the obligee that the obligee will waive the obligee’s claim against all the solidary obligors free of charge.

(3) The provisions of subsections (1) and (2) of this section also apply if an obligee waives the obligee’s claim against a solidary obligor before the solidary obligation arises.

  • 67. Defences of solidary obligors

(1) If any one solidary obligor has performed an obligation in full, the other solidary obligors are not liable for the performance of the obligation. The same applies in the case of substituted performance, deposit or set off. A solidary obligor may only set off the obligee’s claim against the obligor’s claim.

(2) Any solidary obligor may set up defences against the claim of the obligee which arise from the solidary obligation or from the obligor’s own legal relationship with the obligee.

(3) If a solidary obligor does not set up a defence against a claim of the obligee which could have been set up by any of the solidary obligors, the solidary obligor does not have a right of recourse against the other solidary obligors to the extent by which the solidary obligation would have diminished as a result of such defence, unless the solidary obligor did not know and did not have to know of the circumstances underlying the defence.

  • 68. Applicability of circumstances with regard to solidary obligors

(1) A solidary obligor shall not be liable for non-performance of the solidary obligation by another solidary obligor.

(2) Consequences arising to one solidary obligor from a delay in acceptance by an obligee or from postponement of the due date for the performance of the obligation also apply to the other solidary obligors.

(3) Circumstances not specified by law which affect the liability of solidary obligors, in particular defences regarding limitation periods, apply only to the solidary obligor concerned unless otherwise dictated by the solidary obligation.

  • 69. Relations between solidary obligors

(1) In relations between themselves, solidary obligors are liable for the performance of the obligation in equal shares unless otherwise provided by law, the contract or the nature of the obligation.

(2) If a solidary obligor has performed the solidary obligation, the claim of the obligee against the other obligors transfers to the solidary obligor (right of recourse of solidary obligor) except to the extent of the solidary obligor’s own share of the obligation.

(3) In the case provided for in subsection 66 (1) of this Act, the other obligors have the right of recourse against the obligor who is released from the solidary obligation to the extent of the obligor’s share of the obligation in relations between the solidary obligors. This does not apply if the obligee reduces the claim thereof to the extent of the share which the obligor with regard to whom the obligee waived the claim is to bear in relations between the solidary obligors.

(4) If a solidary obligation involves performance of acts other than payment of money, the solidary obligor who has performed the obligation may only claim compensation in money from the other solidary obligors.

(5) A solidary obligor may claim compensation for reasonable expenses made by the obligor upon performance of the obligation from the other solidary obligors according to their shares in the obligation. Compensation for expenses shall not be claimed if the expenses are exclusively related to the solidary obligor.

(6) If a solidary obligor fails to perform the share thereof in the obligation with regard to the solidary obligor who performed the obligation, the solidary obligor who performed the obligation and the other solidary obligors shall be liable for the performance of such share proportionally to their shares in the obligation. The claim against the solidary obligor who fails to perform the obligation transfers to the solidary obligor who performed the obligation and to the other obligors.

(7) The provisions of subsections (1) to (6) of this section apply correspondingly to relations between persons who have secured performance of an obligation by an obligor with securities.

[RT I 2003, 78, 523 – entry into force 27.12.2003]

  • 70. Limitation period for right of recourse by solidary obligor

(1) The limitation period for the right of recourse by a solidary obligor who has performed the solidary obligation expires at the time when the claim of the obligee against the solidary obligor against whom the right of recourse is exercised would expire.

(2) The limitation period for the right of recourse by a solidary obligor shall not expire earlier than six months as of the date on which the solidary obligor performed the obligation or the obligee filed an action with a court against the obligor for the performance of the obligation.

(3) The provisions of subsection (2) of this section do not apply if a solidary obligor performs the obligation after the limitation period for the claim against the obligor or the solidary obligor against whom the obligor exercised the right of recourse has expired.

(4) Claims for compensation for reasonable expenses provided for in subsection 69 (5) of this Act and claims arising from negotiorum gestio or unjustified enrichment which can be filed in lieu of exercising the right of recourse shall expire together with the right of recourse.

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