NEWSLETTER-2017

239 LAW OF OBLIGATIONS even in the event of unlikelihood of debt repayment occurring due to the fault of the debtor, Articles 112 and 125 of the TCO (Articles 97,107,109 of SCO) shall be applied by analogy, and the creditor shall have the right to revoke the contract. According to this view, it is unreasonable to prevent the creditor from requesting the restitution of the performance already executed in the event of non-repayment where the debtor is liable, as it is pos- sible to request so when the debtor is not so liable. In parallel, as it is possible to revoke the contract where performance of the obligation is possible in in the event of default, the same right to revoke the contract shall exist in cases where it is impossible to perform the obligation. If this view is accepted, in the event of the unlikelihood of repay- ment of a debt of a the debtor is responsible, the creditor will have a right of choice, the same as in the event of default of the debtor, and may claim either the compensation of the positive damage or the nega- tive damage by revoking the contract. In the event that the amount of the negative damage is higher than the positive damage, revoking the contract is more beneficial for the creditor. The Federal Court reasoned its stated decision as follows: in the event of subsequent unlikelihood of repayment of a debt of which a debtor is responsible, it is not right to place the creditor in a worse situation than that of the default of the debtor 2 . Especially, if part of the obligation that was performed, prior to the debt being unpaid, has no significance for the creditor any longer, and different from the default situation, the creditor may not terminate the contract 3 . In such a case, it would be convenient to grant a formative right to the creditor allowing ex tunc termination of the contract through application of Articles 107 II and 109 of the SCO (Articles 123 and 125 of TCO) by analogy. Ac- cordingly, the court decided that such a right to revoke is necessary for the parties to escape their conventional obligations entirely, and revert to their conditions during the formation of contractual relationship. The debtor will be held liable for reimbursement of any negative damages 4 . 2 TF, 4A_101/2015, c. 4.5 (21.07.2015). 3 TF, 4A_101/2015, c. 4.4 (21.07.2015). 4 TF, 4A_101/2015, c. 4.4 (21.07.2015).