Novation as a mode of extinction of obligations

Abstract

The institute of novation as provided for in Maltese law is the basis of the thesis being submitted in partial fulfilment of the Faculty of Laws requirement for the award of the degree of Doctor of Law. The provisions of the law gives one the impression that the institute of its nature, gives rise to dangerous repercussions and tends to prejudice certain rights of parties to a contract. Conclusions are sought as to its valid application in present circumstances. Although the general conception appears to be that the institute has lost much of its relevance under modern law, a detailed study establishes that a judicious application of the law proves its undisputed utility. Due to the absence of a specific procedure which permits one to effect directly the assignment of 'debts'; novation by the substitution of a debtor remains one of the means whereby such a transfer is effected. On the other hand, the possibility· of a novation through the change of the object provides the parties modifications without or cause of the obligation, with an opportunity to effect being constrained to proceed successively to the extinction of and creation of the relevant obligation. At this stage it is pertinent to note that the bas is of this institute in Maltese law, derives in the main from the Code Napoleon and the Italian Civil Code of 1865. To obtain the best possible interpretation of the institute, it is of essence to refer continuously to the early writings of established jurists of the times. Furthermore, the study’s other objective is the elucidation of various issues which arise as a consequence of the generic wording adopted in the relevant sections of the law. Where appropriate, reference to more recent views has also been made with the aim of enhancing the understanding and consequent application of the institute of novation.