§ 416. If the purchaser of real estate assumes by contract with the grantor a debt of the grantor which is secured by a mortgage of the real estate, the creditor can accept the assumption only if notified by the grantor. If six months have elapsed since the receipt of the notice, the acceptance is to be regarded as given, unless the creditor has previously notified the grantor of his refusal. The provisions of § 415, ¶ 2, sentence 2, are not applicable.

The notice of the grantor can be given only after the purchaser has been entered as owner in the registry of deeds. The notice must be given in writing and must contain the statement that the purchaser has assumed the place of the previous debtor unless the creditor expresses his refusal within six months.

The grantor must when requested by the purchaser notify the creditor of the assumption of the debt. As soon as the giving or refusing of acceptance is settled the grantor must notify the purchaser.

$ 417. The one who assumes the debt can set up against the creditor the defences which arise out of the legal relation between the creditor and the previous debtor. A claim belonging to the previous debtor cannot be set off.

The one who assumes the debt cannot set up against the creditor defences arising from the legal relations between himself and the previous debtor, upon which the assumption of the debt was based.

§ 418 In consequence of the assumption of a debt the sureties and pledges for it are released. If the claim is secured by a mortgage the effect is the same as if the creditor had renounced the mortgage. These provisions do not apply if the surety or he to whom the pledged property belongs at the time of the assumption of the debt assents to such assumption.

A right of priority in bankruptcy belonging to the claim cannot be made effective in bankruptcy as against the property of the one who assumes the debt.

$419. If any one acquires by contract the property of another, the latter's creditors can, without prejudice to the continuance of the liability of the previous debtor, enforce against the grantee also, from the formation of the contract, the claims which they had at that time.

The obligations of the grantee are limited to the amount of the granted property and the rights belonging to him by virtue of the contract. If the grantee sets up the limitation of his liability

the provisions of §§ 1990, 1991 with reference to the liability of heirs are applicable.

The obligation of the grantee cannot be excluded or limited by agreement between him and the previous debtor.

SWITZERLAND. - Code Fédéral des Obligations.

§ 128. One who, acting in his own name, has stipulated for an obligation in favor of a third person, has the right to enforce performance for the benefit of the third person.

The third person, or his successors in interest, can also personally demand performance when such was the intention of the parties. In such a case, if the third person notifies the debtor that he wishes to exercise the right, the creditor cannot afterwards release the debtor.

Art. 1119. No one can in general bind himself or stipulate in his own name, except for himself.

Art. 1121 A party may likewise stipulate for the benefit of a third person when such is the condition of a stipulation that he makes for himself, or of a donation that he makes to another. He who has made this stipulation can no longer revoke it if the third person has declared his wish to take advantage of it.

Art. 1165. Contracts have no effect except between the contracting parties. They do not impose liability upon a third person, and they do not give him any rights except in the case covered by Art. 1121.

Art. 1166. Nevertheless creditors can make use of all the rights and actions of their debtor except those which are wholly personal.1

1 The French Code has had a wide influence upon the legislation of the Latin countries of Europe and America. A few countries have directly copied from the sections here translated:

BELGIUM. Code Civil.

The French Code is in force.

HOLLAND. - Burgerlijk Wetboek (the French translation of G. Tripels has been used). Articles 1351, 1353, 1376, 1377 are translations of the articles of the French Code given above.

ITALY.- Codice Civile.

Articles 1128-1130 are translations of Articles 1119, 1121, 1165 of the French Code. UPPER CANADA. - Civil Code.

Articles 1029 and 1031 are translations of Articles 1121 and 1166 of the French Code.

Art. 1890. A person may also, in his own name, make some advantage for a third person the condition or consideration of a commutative contract, or onerous donation; and if such third person consents to avail himself of the advantage stipulated in his favor, the contract cannot be revoked.

SPAIN.- Codigo Civil.

Art. 1257. Contracts only have effect between the parties who made them, and their heirs. .

If the contract contained any stipulation in favor of a third person, the latter may exact its fulfilment provided that he has made known his acceptance to the obligor, before revocation by him.

Art. 1277. Contracts bind only the parties to them.

Art. 1957. Contracts neither injure nor benefit third persons (except in the following cases). . . . They only benefit such persons when they are made in favor of a third person, and he expressly or tacitly accepts them.

Art. 1196. Unless forbidden creditors can make use of all rights and actions of their debtor, except such as are personal.

Art. 1199. Contracts cannot be set up against third persons, nor taken advantage of by them, except in the cases of articles 1161 and 1162. (These articles relate only to cases of agency.)

URUGUAY.- Codigo Civil.

Art. 1230. If any one, contracting in his own name, has stipulated for any benefit in favor of a third person, and has no authority to represent him, such third person can exact the fulfilment of the obligation, if he has accepted it and has notified the obligor thereof, before revocation.

Art. 1267. Contracts cannot be set up against third persons, nor taken advantage of by them, except in the cases of articles 1228 to 1230.

Art. 1259...

A contract may be made in favor of a third

person, even without his consent.

In this last case the contracting parties are not free to rescind the contract if the third person has accepted the stipulation.

Art. 1261. The creditors of a person who has rights acquired under a contract may be authorized to enforce them, unless the debtor is entitled to delay in making payment of his debt.

Art. 537. If one of the parties bind himself by the contract to make some payment to a third person, the latter is entitled to demand such payment direct from the debtor.

The right of the third person under the circumstances mentioned in the preceding clause is created when he expresses to the debtor his intention to enjoy the benefit accruing to him from the

contract.

Art. 538. After the right of the third person has in accordance with the provisions of the preceding article been created, the parties to the contract can neither change nor extinguish it.

Art. 539. A defence which is based on a contract such as that mentioned in Article 537, may be set up by the debtor against the third person who will benefit by the contract.

The main deductions warranted by these extracts from foreign codes may be briefly summarized. It is very instructive to observe that, although the Roman Law refused to recognize any legal right in the beneficiary of a contract, the modern civil law almost universally gives him a direct remedy. As this result was in violation of what had formerly been the law, it is a strong indication that there is a real necessity for the relief of the beneficiary. It must not be thought, however, that the term "beneficiary" necessarily includes a creditor whose debtor has been given a promise to pay the debt, though it certainly does sometimes. Such a creditor was allowed in the Roman Law an actio utilis, that is, an action to enforce a right of his debtor. In the French and some of the other codes the creditor is given such an action, so that if he has

no right of his own, he is entitled to satisfy his claim by enforcing on behalf of his debtor the latter's right of action. It is possible that even where codes make no express provision for such a remedy, it is nevertheless allowed.

The selections from the German Code deserve particular atten. tion, because that code is the most recent and the most carefully considered of the codes, and the subject is more elaborately treated there than in any other code. The fundamental idea of the Ger man legislators was evidently to give effect to the intention of the contracting parties. If they intended the third person should have a right of action, he is to have it. As such intentions are frequently not expressed, the code gives some rules to be applied in cases where the intention is doubtful. The Swiss Code, also, makes intention the governing fact. The sections of the German Code on the assumption of debts provide a useful means for fixing, so that they cannot be mistaken, a creditor's rights when the debt due him has been assumed by a third person. If the creditor, when notified, assents to the arrangement, there is a novation, and his only right is against his new debtor. If he does not assent, his only direct right is against his original debtor, but the latter has a right against the one who assumed the debt.

Samuel Williston.