What methods of ensuring the fulfillment of obligations are provided for by law?

The legislation provides for the following methods of ensuring the execution of the contract.
1. Forfeit (fine, penalty). A forfeit (fine, penalty interest) is a sum of money determined by a law or an agreement, which the debtor is obliged to pay to the creditor in case of non-performance or improper performance of the contract. Thus, the attractiveness of a forfeit in comparison with compensation for losses is due to the fact that in the event of collection of a forfeit the creditor is relieved of the obligation to prove the existence and amount of losses: the amount of the forfeit is determined in advance in the contract or law and does not depend on the amount of losses.
There is one exception to this rule: if the penalty payable is clearly disproportionate to the consequences of the violation of the obligation, the court has the right to reduce the penalty as well. The rest of the penalty is characterized by the same disadvantages as compensation for losses. That is why many legal scholars recognize a penalty not as a way to enforce the contract, but as a special measure of civil liability.
2. Collateral. The instability of the creditor’s position lies in the fact that by the time the obligation is fulfilled, the debtor may not have any property at all, which could be foreclosed. It would be another matter if in the debtor’s property existing at the time of the conclusion of the contract, it would be possible to single out some part of it, the debtor’s rights to which would be temporarily limited and to which the creditor, in the event of a debtor’s malfunction, could foreclose mainly to other creditors …
This is exactly the opportunity that the pledge provides. The essence of the pledge is to separate the property of the debtor (called the pledger), usually passing into the possession of the creditor (called the pledgee), in order to ensure the priority satisfaction of his claims. In other words, the creditor acts on the principle “I believe not a person, but things”.
3. Retention. The debtor’s property may be with the creditor not only as a pledge, but also on another basis, for example, on the basis of an agreement on the performance of work, on the provision of services. For example, a laundromat cannot but own the linen of its client, and the contractor, as a rule, has the result of the work to be transferred to the client.
In the event that the debtor fails to fulfill the obligation to pay for this thing or reimburse the creditor for related costs and other losses, the creditor, in accordance with the Civil Code, has the right to withhold such a thing until the corresponding obligation is fulfilled. If the debtor nevertheless persists in his unwillingness to fulfill the obligation, the creditor’s claims may be satisfied in the manner provided for the satisfaction of the claims secured by the pledge.
4. Surety. The lender can believe not only things, as in the case of a pledge, but also the promise of a person in whose solvency he is sure. Typically, this promise is made in the form of a surety. Under the contract of suretyship, the surety undertakes to the creditor of another person to be responsible for the performance by the latter of his obligations in whole or in part. In the event of non-fulfillment or improper fulfillment of the obligation, the creditor gets the opportunity to present his claims to both the original debtor and the surety. The surety, who fulfilled his obligation for the debtor, acquires the rights of the creditor in relation to him, i.e., in other words, he can demand from the debtor to return the amounts that the surety had to pay.
5. Down payment. In most obligations, one of the parties must pay the other party a certain amount of money, i.e. is obligated to make payment. However, a part of the payment can be given a different legal regime, turning it into a deposit.
At the time of the conclusion of the contract or somewhat later, one party obliged to make a payment pays the other party a part of the amount to be paid, stipulating that this payment is a deposit. An agreement that this amount is a deposit must be made in writing and can be contained either in the main contract or in a separate document.

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