Article 349: Novation by substitution

Décisions de la Cour suprême interprétant cette section

1. Arrêt de la Cour suprême n° 2737/2548 (2005)

   Agreeing to reduce and restructure an existing debt into a new instalment loan with a formal loan document changes an essential element of the obligation and constitutes novation under section 349.

   The defendant owed the plaintiff 15,467,184 baht. They agreed the plaintiff would reduce the debt by 467,184 baht, and the remaining 15,000,000 baht would be repaid by monthly instalments of 1,000,000 baht, documented as a new loan agreement. The Court held this constituted a change of an essential element of the original obligation and was therefore a novation under section 349. The cheques issued for the monthly instalments were cheques issued for a real and enforceable debt under the new agreement.

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2. Arrêt de la Cour suprême n° 2675/2548 (2005)

   Where the new obligation arising from novation fails to come into existence (here because of an unfulfilled delivery condition), the original obligation survives under section 351.

   The debtor agreed to convert a loan debt into a vehicle sale contract. The sale contract included a condition that no sale would be deemed to exist until the vehicle was delivered. Because delivery never occurred, the new obligation arising from novation never came into existence; under section 351, the original loan obligation therefore survived and the debtor's heir remained liable.

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3. Arrêt de la Cour suprême n° 6788/2552 (2009)

   Whether a debt restructuring agreement constitutes novation is a justiciable legal question with direct consequences for guarantors; parties may agree to submit that single question to the court for determination.

   The parties had jointly submitted to the court a single legal issue for determination: whether a debt restructuring agreement between the creditor and the principal debtor constituted novation. If it did, the guarantor (defendant 3) would be released. The Court treated this as the sole issue, and the parties' additional arguments outside that agreed issue were inadmissible on appeal.

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Curated decisions with case numbers verified against the Supreme Court database. English renderings are the firm's editorial translation for study.