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Book 2 · Law of obligations  ›  Title 4 · Earnest, penalty for breach of contract › Section 338

Earnest in case of impossibility of performance for which the giver of earnest is responsible

If the performance owed by the giver of the earnest becomes impossible due to a circumstance for which they are responsible, or if the giver of the earnest is at fault for the cancellation of the contract concluded, then the recipient of the earnest may retain it. If the recipient demands damages for non-performance, then, in case of doubt, the earnest is to be credited against it, or if this cannot occur, it is to be returned when compensation for the damage is provided.

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