Termination of a contract due to excessive hardship calls for two requirements beyond the ones for blue-penciling: extreme advantage to the counterparty and extraordinary nature of the events.
Accordingly, whenever the conditions for termination are met, the conditions for blue-penciling will also be met, but the reverse does not necessarily occur.
The Civil Code requires an express claim by the party in both cases, which prevents the judge from taking the initiative to void or redraft the contract due to hardship sua sponte.
The discussion becomes more controversial when there is a request by a party to terminate the contract, but not to revise it.
For some, blue-penciling of some obligations is a less burdensome result for the parties than termination of the contract, and, for this reason, if there is an express prayer for termination of the contract, then the judge may likewise blue-pencil it.
Others maintain the position that there is no direct correlation between termination, blue-penciling, and their respective levels of burdensomeness, given that, in some circumstances, the very party that seeks termination may have no secondary interest in blue-penciling.
Even so, under the previous Code of Civil Procedure, the judge that decided to blue pencil the contract sua sponte often decided the matter without even hearing the parties.
Although the new Code of Civil Procedure has not directly addressed the issue, its tenth article established that "the judge may not decide, at any level of appeal, based on grounds with respect to which the parties have not been given an opportunity to present arguments, even if it is a matter which the judge should decide sua sponte."
This provision significantly reduces the problems that may arise from sua sponte blue-penciling due to excessive hardship. After all, even if the court deems blue-penciling permissible, it will first have to hear the parties in this regard, at which time they may state whether or not they have a secondary interest in blue-penciling and object if they consider it to be more burdensome than termination.
This gives parties more certainty in bringing contract termination claims in court when they do not have an interest in blue-penciling, as they will be assured that they will not be surprised by unwanted blue-penciling, which is sometimes more burdensome than termination.