Artikel 7:109 Appropriation of Performance

Where a party has to perform several obligations of the same nature and the performance tendered does not suffice to discharge all of the obligations, then subject to paragraph 4 the party may at the time of its performance declare to which obligation the performance is to be appropriated.

If the performing party does not make such a declaration, the other party may within a reasonable time appropriate the performance to such obligation as it chooses. It shall inform the performing party of the choice. However, any such appropriation to an obligation which:

In the absence of an appropriation by either party, and subject to paragraph , the performance is appropriated to that obligation which satisfies one of the following criteria in the sequence indicated:

the obligation which is due or is the first to fall due;

the obligation for which the creditor has the least security;

the obligation which is the most burdensome for the debtor

the obligation which has arisen first.

If none of the preceding criteria applies, the performance is appropriated proportionately to all obligations.

In the case of a monetary obligation, a payment by the debtor is to be appropriated, first, to expenses, secondly, to interest, and thirdly, to principal, unless the creditor makes a different appropriation.