Chapter five
Types of delegation and their consequences
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SCHOOL OF LAW A THESIS SUBMITTED IN THE, CHALLENGES OF CASE MANAGEMENT IN SOMALILAND HIGH COURT
Types of delegation and their consequencesDelegation of obligations may be perfect delegation or imperfect delegation. This classification depends on the intention of the parties. The parties may agree that the old debt owed by the delegator towards the creditor will be extinguished and that the original debtor will be relieved from any obligation. For instance, a creditor who has been provided with sufficient securities by the delegate debtor may release the original debtor. This is a case of perfect delegation. In such cases the creditor has no right over the original debtor (debtor) after delegation. On the contrary, they may have intended that the old debtor (delegator) will not be exonerated but rather the creditor will have a second debtor, delegator, in addition to the first one, delegate debtor. This is a case of imperfect delegation. Article 1977 of the Civil Code seems to imply this distinction between perfect and imperfect delegation. This provision gives recognition for imperfect delegation. The presumption of the law is that of imperfect delegation where the creditor who has consented to delegation still retains his right against the original debtor. In case of imperfect delegation, the relationship of the original debtor vis-a-vis the creditor is that of a simple guarantor and a creditor. The creditor retains his right against the original debtor but he may not demand satisfaction from the original debtor before demanding performance from the delegate debtor (see Article 1977(2) of the Civil Code). The creditor may not proceed against the original debtor prior to demanding performance from the delegate debtor. It is because of this fact that imperfect delegation is said to resemble suretyship. The situation might be entirely different where delegation is perfect. In such cases, the creditor has consented to discharge the delegator. In this regard, Article 1981 talks about perfect delegation in case of insolvency of the delegate debtor. This provision approaches the situation from two aspects: firstly, the creditor is entitled to proceed against the original debtor who has been discharged, if the insolvency of the delegate debtor was judicially established at the time of delegation (Article 1981(2) of the Civil Code). This is because it is believed that there has been either error or fraud and that the liberation of the old debtor would not have been consented to had the insolvency of the new debtor been known by the creditor. Secondly, if the insolvency of the delegate debtor occurred after the delegation, then the risk of insolvency is borne by the creditor. This is a normal risk assumed by every creditor. However, Article 1981(1) of the Civil Code provides the possibility for the creditor to foresee such risk and avoid it by expressly reserving his recourse against his old debtor in case the new debtor is unable to make payment. Download 53.56 Kb. Share with your friends:
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