Risk Allocation When Performance Becomes Impossible

Plain-language explanation

This article deals with "risk allocation" — who bears the financial consequence when one party's contractual obligation becomes impossible to perform through no one's fault. Under paragraph 1, if performance becomes impossible due to a cause not attributable to either party (e.g., a natural disaster destroying goods in transit), the creditor (the party who would have received performance) can refuse to perform their own counter-obligation, such as paying the price. In practice: if goods are destroyed by an earthquake before delivery and neither the buyer nor seller was negligent, the buyer does not have to pay.

Paragraph 2 covers the opposite situation: if the impossibility is caused by the creditor's own fault, the creditor cannot refuse to perform their counter-obligation (e.g., cannot refuse to pay). This prevents a party from sabotaging a contract's performance and then avoiding payment. However, if the debtor (the party who couldn't perform) benefited in any way from not having to perform — for example, saving on materials or labor costs — that debtor must return that benefit to the creditor.

A common business scenario is a construction contract where the client's own interference or defective instructions make it impossible for the contractor to complete the work — in that case, the client cannot refuse to pay the contract price, though the contractor must refund any savings (like unused materials resold) gained from not finishing the job. Because this is a default rule, parties frequently override it with explicit risk-allocation or force majeure clauses in their contracts.

日本語での解説

Common scenarios

• ▸商品が輸送中に不可抗力(自然災害)で滅失し、買主が代金支払いを拒否するケース
• ▸発注者の指示ミスや妨害により請負工事が完成できず、代金支払い義務の有無が争われるケース
• ▸サービス提供契約で顧客側の都合により役務提供が不可能になった場合の料金請求
• ▸賃貸借契約で借主の過失により目的物が使用不能となった際の賃料支払い義務
• ▸契約書に危険負担条項(force majeure条項)を設ける際の交渉場面