Study On Some Problems Concerning Imputation Of Payment

The institution of imputation of payment, which origins from Roman law, hasbeen recognized by most continental territorial legal units (such as Germany, Japanand Chinese Taiwan) during the codification of civil law. However, it does not showup in General Principles of the Civil Law as well as the Contract Law of mainlandChina. Imputation of payment has only been regulated by the Second JudicialInterpretation of Contract Law published by the Supreme Court of China.Chapter One of this paper shall discuss some problems of article21&22of theSecond Judicial Interpretation of Contract Law. The following problems shall bestudied: firstly, the Interpretation has only regulated the situations of imputation byagreement and by law, but lacks the situation of imputation by appointment; secondly,the scope of the subject of the imputation by agreement is too narrow; thirdly,concepts used by the provisions concerning the limit of imputation by law (priority offees and interests to discharge) are not precise or well chosen; fourthly, the lack ofregulations by Law and the shortages of the Judicial Interpretation have causedseveral problems in actual judicial practice.Chapter Two shall study the fundamental theory of the institution of imputationof payment.Chapter Three shall discuss the interpretations and applications of the provisionsconcerning imputation of payment in several continental territorial legal units.The institution of imputation of payment regulated by the Civil Code of Japan(CCJ) shall be studied first. Article488of CCJ provides that both the Solutor and therecipient of payment have the right to appoint the imputation, but the legal effects are different. Under the circumstance of imputation by law, article489of CCJ hasdecided to protect the interests of the debtor only. Article490of CCJ has broaden thefield of application of the provisions concerning imputation of payment to thesituation of installment payment of the same debt. Article491has regulated thesequence of imputation of fees, interests and the original debt.After that, imputation of payment regulated by the Civil Code of Germany (BGB)shall be discussed. In Germany, only the Solutor has the right to appoint theimputation, which has been under several restrictions in actual judicial practice. Underthe circumstance of imputation by law, BGB has made some balance between theprotections of the creditor and the debtor. If the imputations of different debts makeno differences towards the protection of the debtor’s interests, BGB has decided todetermine the sequence of imputation of payment by the occurrence of that debt.There is also provision concerning the sequence of imputation of fees, interests andthe original debt in BGB.At last, the situation in Chinese Taiwan shall be discussed. It seems that CivilCode of Chinese Taiwan (CCCT) has taken views from both BGB and CCJ. Under thecircumstance of imputation by appointment, CCCT has taken the standpoint of BGBonly. However, when it comes to the case of imputation by law, CCCT has learnedlessons from both BGB and CCJ. It has made some balance between the protectionsof the creditor and the debtor just as BGB, but when the imputations of different debtsmake no differences towards the protection of the debtor’s interests, it stands on theside of CCJ. The provision concerning the sequence of imputation of fees, interestsand the original debt of CCCT is almost as same as BGB with only slightimprovement to clearly limits the scope of the concept of interests.Chapter Four shall mainly discuss the refinement of Chinese legal institution ofimputation of payment. This paper suggests that we should adopt the method used bymost continental territorial legal units to recognize both the imputation byappointment and by law. Apart from that, only the Solutor shall have the right toappoint the imputation, which is the standpoint of BGB and CCCT. When it comes toimputation by law, the regulating mode of BGB shall be followed to make somebalance between the protections of the creditor and the debtor. On the fourth segmentof the imputation by law, the method of determining the sequence of imputation bythe occurrence time of the debts shall be adopted in order to achieve perfection andscientificalness of the inner logic of the legislation. The concept of interests shall be restricted in to exclude the liquated damages in order to perfect article21of theSecond Judicial Interpretation of Contract Law.