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What is an obligation?

An obligation is a juridical necessity to give, to do or not to do. (Art. 1156)


What are the kinds of obligations?

Natural and civil.


What do you mean by obligation being a juridical necessity?

Obligation is a juridical necessity because in case of non-compliance, the courts of justice may be called upon to enforce its fulfillment or, in default thereof, the economic value it represents.


Obligor or debtor v. obligee or creditor

Obligor or debtor
- he who has the duty of giving, doing, or not doing

Obligee or creditor
- he who has the right to the performance of the obligation


What are some of the natural obligations?

Title III, Articles 1423-1430.
Examples (not exclusive):
- performance after civil obligation has prescribed
- reimbursement of third person for debt that has prescribed
- restitution by minor after annulment of contract
- delivery by minor of money or fungible thing in fulfillment of obligation
- performance after action to enforce civil obligation has failed
- payment by heir of debt exceeding the value of property inherited
- payment of legacy after will has been declared void


Essential requisites of an obligation?

1. Passive subject (debtor or obligor)
2. Active subject (creditor or obligee)
3. Object or prestation (subject matter of the obligation)
4. Juridical or legal tie or efficient cause (like anong law or source ng obligation)


Under a building contract, X bound himself to construct a house for Y for P1,000,000. Point out the elements.

X = passive
Y = active
Building = Object
Contract = Juridical Tie

After X had constructed the house, X becomes the active subject and Y becomes the passive subject.


When do actions prescribe?

Actions prescribe by the mere lapse of time fixed by law. (Article 1139)


Prescription of written contract? Prescription of oral contract?

Art. 1144
Upon a written contract
Upon an obligation created by law
Upon a judgment
= Within 10 years from the time the right of action accrues

Art. 1145
Upon an oral contract
Upon a quasi-contract
= within 6 years
- pero 4 years daw sabi ni sir ??

Art. 1146
Upon an injury to the rights of the plaintiff
Upon a quasi-delict
= within 4 years

Art. 1154
The period during which the obligee was prevented by a fortuitous event from enforcing his right is not reckoned against him.

**Dapat may demand muna kasi wala naman sa law na default yun.


What are the sources of obligations?

1. Law
- imposed by the law itself

2. Contracts
- arise from the stipulation of the parties

3. Quasi-contracts
- arise from lawful, voluntary and unilateral acts which are enforceable to the end that no one shall be unjustly enriched or benefited at the expense of the other
a. Negotiorum Gestio
b. Solutio Indebiti
c. Other Quasi-contracts

4. Acts or omissions punished by law
- arise from civil liability as a consequence of a criminal offense

5. Quasi-delicts or torts
- arise from damage by fault or negligence without any contractual relation existing between the parties


What is a contract?

A meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service. (Art. 1305)


Are there any other obligations as defined in Article 1156?

No. The enumeration by the law is exclusive.


Obligation came from what Latin Word?

Obligatio - tying or binding
Obligare - to bind


Difference between a creditor and an obligee

They can be used interchangeably but technically
creditor - obligation to give
obligee - obligation to do


Latin term for juridical tie

paritas iuris


Paano nagkakaroon ng juridical tie?

From the sources of obligations:
a. Law or unilateral acts
b. Contracts or bilateral acts
c. Delicts or quasi-delicts or unilateral acts
d. Auto contracts (One person but 2 parties. B is represented by A)


Does the court still have jurisdiction on natural obligations?



A is entitled to pay P1M to B. It is a pure obligation without any conditions. The contract was executed on Sept. 21, 2020. No demand was given. On Oct. 21, 2030, B demanded from A. Nagprescribe na yung deadline to pay pero nagbayad padin sya kasi nahihiya sya. Tapos nung nawalan na sya ng pera naisip nya kukunin nya ulit kasi nagprescribe naman na eh. Pwede pa ba bawiin?

No right to enforce but there is a relative juridical effect pag natural obligation. Binigay na voluntarily eh.

Relative juridical effect - may right of retention na yung nakatanggap ng bayad


What is prescription?

Prescription is the loss or acquisition of a right through lapse of time.


What can stop prescription?


**Different from "how is the running of prescription interrupted?"


What is a positive law?

Human-made laws that oblige or specify an action.


What is the rationale behind a prescription?

To protect the rights of those who are vigilant. If di ka naman maingat to protect your rights, edi why would the courts do the same? the court will not aid those who are sleeping with their rights.


Explain Article 1158.
"Obligations derived from law are not presumed. Only those expressly determined in this Code or in special laws are demandable, and shall be regulated by the precepts of the law which establishes them; and as to what has not been foreseen, by the provisions of this Book."

Obligation mo to read and comply; wag na mag-assume nakasulat na nga sa mga batas eh! lol


An agreement is necessary in order that a party may demand from another the fulfillment of an obligation. T or F

There are sources of obligations which do not necessitate an agreement. - law (ex: payment of taxes)


What is the characteristic or fundamental principle of contract that gives them the force of law?

Autonomy of contracts

Contract has the force of law provided that it is not contrary to law, morals, good customs, public order or public policy.


What is a quasi-contract?

Art. 2142.
Juridical relations arising from lawful, voluntary and unilateral acts by virtue of which the parties become bound to each other.
"Parang contract"

Requisites: lawful, unilateral, voluntary
Objective: that no one shall be unjustly enriched at the expense of others


Nominate v. innominate contracts

Nominate contracts are those which have a particular name to distinguish them; as, purchase and sale, hiring, partnership, loan for use, deposit, and the like.

Innominate contracts, are those which have no particular name.


Principal forms of quasi-contracts

1. Negotiorum Gestio (inofficious manager) - Arises when a person voluntarily takes charge of the management of the business or property of another without knowledge or consent from the latter

2. Solutio Indebiti (unjust enrichment) - Takes place when a person received something from another without any right to demand for it, and the thing was unduly delivered to him through mistake.


Elements of negotiorum gestio

1. The gestor must voluntarily assume the agency or management of the business or property of another
2. The business or property must be either neglected or abandoned
3. The agency or management must not be authorized by the owner either expressly or impliedly
4. The assumption of the agency or management must be made in good faith


Pumasok ka sa Jollibee tapos sabi mo ikaw na magmamanage. Pwede ba yun?

No. Hindi naman abandoned eh.


Requisites of solutio indebiti

1. Something has been received when there was no right to demand it
2. The same was unduly delivered through mistake


Examples of innominate contracts

Art. 2164 - support given by a stranger
Art. 2165 - funeral expenses borne by a third person without knowledge of relatives
Art. 2166 - support orphan, insane, indigent
Art. 2167 - accident, injured, ill, treatment - victim not in a position to give his consent
Art. 2168 - fire flood storm or other calamity - property destructed but saved by another
Art. 2169 - government, upon failure of person to comply with health and safety regulations, undertakes necessary work
Art. 2170 - accident or fortituous event - movable separately - co-owners
Art. 2173 - a third person, without knowledge of debtor, pays debt


Solutio indebiti v. Accion in rem verso

Solutio indebiti (SI) v. Accion in rem verso (AIRV)
1. Mistake is an essential element in SI which is not necessary in AIRV;
2. An AIRV is merely an auxilliary action, available only when there is no other remedy on contract, quasi-contract, crime or quasi-delict


Prescription v. Laches

- case to case basis; based on equity
- basta maestablish na pinabayaan mo yung right mo

- provided by the law (statutory-based)
- you are the owner of a parcel of land. Hinayaan mo na magsquat doon mga tao. Your land is untitled. For how many years, although ikaw ang may-ari, dahil sa iyong negligence, that parcel of land may become a property of those informal settlers.


What is a quasi-delict?

An act or omission by a person which causes damage to another in his person, property, or rights giving rise to an obligation to pay for the damage done, there being fault or negligence but there is no pre-existing contractual relation between the parties.


Difference between a quasi-delict and a tort?

Tort is broader.


Requisites of a quasi-delict

1. There must be an act or omission by the defendant
2. There must be fault or negligence by the defendant
3. There must be damage caused to the plaintiff
4. There must be a direct relation or connection of cause and effect between the act or omission and the damage
5. There is no pre-existing contractual relation between the parties


What is negligence?

Negligence or culpa. The failure to take reasonable care, causing injury or loss to another person

a. Culpa aquiliana - quasi-delict
b. Culpa contractual - Art. 1173


Test of Negligence

Would a prudent man foresee harm as a reasonable consequence to the act pursued?


Fraud v. Negligence

F: deliberate intention to cause damage or injury
N: no such intention

F: waiver for liability is void
N: may be allowed in negligence

F: must be clearly proved, mere preponderance of evidence not sufficient
N: presumed from the breach of a contractual obligation

F: Liability cannot be mitigated by the courts
N: may be reduced according to the circumstances


In criminal cases, only 1 remedy can be chosen, either from delict or quasi-delict. The plaintiff cannot recover twice. T or F.



Quasi-delict v. Crime

QD: Negligence
C: Criminal or malicious intent

QD: Concerns private interest
C: Affects public interest

QD: Civil liability only
C: Two liabilities - criminal and civil

QD: Restitution, reparation and indemnification
C: Imprisonment

QD: Liability can be compromised as any other civil liability
C: Criminal liability cannot be compromised or settled

QD: Preponderance of evidence
C: Beyond reasonable doubt

QD: Liability of the person responsible for the author of the negligent act or omission is direct and primary.
C: Subsidiary


What is a crime?

Acts/omission punishable by law


Civil liability and criminal liability are generally tried together unless...

There is
1. Waiver
2. Reservation
3. Civil case filed prior to the prejudicial question

*Civil case and criminal case cannot be tried simultaneously except in cases falling under Articles 32, 33, 34, and 2176


Why is it important to know the source of a particular obligation?

Theory of plaintiff, defense of defendant, who to sue, etc. will vary depending on the source of obligation.


Ex: Criminal case in a contract of common carrier. Who will you sue?

If plaintiff chooses
a. Delict - the complaint shall be against the DRIVER; operator will be subsidiarily liable.

b. Quasi-delict - the complaint shall be against BOTH the driver and the operator, both are principally liable.

c. Breach of contract of carriage - the complaint shall be against the OPERATOR

*Although victim has a choice, he cannot recover twice from what he is entitled to.
*Read Araneta v. Hoya


Who is the creditor or debtor in bilateral agreements?

Both parties are reciprocally debtors and creditors.


What are the forms of obligations?

The form of an obligation refers to the manner in which an obligation is manifested or incurred. It may be in oral or in writing, or partly oral and partly in writing.


Period of prescription for actions based upon a written contract

Actions based upon a written contract should be brought within 10 years from the time the right of action accrues. The period of prescription commences, not from the date of execution of the contract but from the occurrence of the breach.


Kinds of obligation according to subject matter

1. Real obligation (to give)

2. Personal obligation (to do)
a. Positive personal obligation (to do or to render service)
b. negative personal obligation (not to do)


The liability of the defendant in a single action may arise from more than one source of obligation. T or F.

True. Ex: law and contract.


Can an employee demand free legal assistance from his employer?

No. No law requires this. He cannot demand such even if the said legal assistance is needed from his recovery of damages to a stranger while in the performance of his duties.


Does a private school have a legal obligation to provide clothing allowance to its teachers?

No law imposes this.


Does a person who wins money in gambling have the duty to return his winnings to the loser?

Yes. In pursuant to Article 2014.


X, by virtue of having been sent for by B and C, attended as physician and rendered professional services to a daughter-in-law of B and C during a difficult and laborious childbirth.

Who is bound to pay the bill: B and C, the parents-in-law of the patient, or the husband of the latter?

The rendering of medical assistance in case of illness is comprised among the mutual obligations to which spouses are bound by way of mutual support. If spouses are mutually bound to support each other, there can be no question that when either of them by reason of illness should be in need of medical assistance, the other is to render the unavoidable obligation to furnish the services of a physician and is liable for all expenses, including the fees for professional services.

B and C not having personally bound themselves to pay are not liable.


X of legal age, bought 2 vessel from B, the purchase price thereof being paid by C, X's father. Subsequently, differences arose between X and C. The latter brought action to recover the vessels, he having paid the purchase price.

Is there any obligation on the part of X to transfer the ownership of the vessel to C?

None. If any such obligation was ever created on the part of X, said obligation must arise from law. But obligations derived from law are not presumed. Only those expressly determined in the Civil Code or in special laws are demandable. Whatever right C may have against X either for the recovery of the money paid or for damages, it is clear that such payment gave him no title, either legal or equitable, to these vessels.

** If X were a minor, the vessels would belong to C in ownership and usufruct under Article 161 of the old Civil Code (now Art. 324). Under Art. 1448, the payment may give rise to a gift or an implied trust.


Do contracts need to be approved by the government?

Only some.

Ex: Contract for overseas employment must be approved by the Philippines Overseas Employment Administration under Art. 21 of the Labor Code


X verbally agrees to pay Y the balance of an account in advance, notwithstanding the different stipulation of a prior written agreement.

Is X bound to perform said obligation?

Yes. Since he agreed to pay Y the balance of the account independently of the terms of the written contract, he must perform his obligation to pay according to the tenor if his verbal agreement which has the force of law between them.


D borrowed money from C to be paid within a certain period, under the agreement that, if D fails to pay at the expiration of said period, the house and lot described in the contract would be considered sold for the amount of the loan.

D failed to pay as promised. C brought action for the delivery of the house and lot.

Are both contracts valid and, should therefore be given effect?

Yes. The fact that the parties have agreed at the same time, in such a manner that the fulfillment of the promise of sale would depend upon the non-payment or return of the amount loaned has not produced any change in the nature and legal conditions of either contract, or any essential defect which would nullify them.

As the amount loaned has not been paid and continues in possession of the debtor, it is only just that the promise of sale be carried into effect, and the necessary instruments be executed. That which is agreed to in a contract is law between the parties, and must be enforced.

**In this case, the Court found that no contract of mortgage, pledge, or antichresis was entered into.


By virtue of an agreement between X and Y, X assisted Y in improving a large tract of land which was later declared by the court as belonging to C.

Has X the right to be reimbursed by Z for X's services and expenses on the ground that the improvements are being used and employed by Z?

No. From the language of Article 2142, it is obvious that a presumed quasi-contract cannot emerge as against one party when the subject matter thereof is already covered by an existing contract with another party. X's cause of action should be against Y who, in turn, may seek relief against Z.


X, a tax-exempt cooperative store, paid taxes to the City of Manila, believing that it was liable.

May X recover the payment?

Yes, as it was made under a mistake.


X stole the car of Y. If X is convicted, the court will order X to...

1. to return the car (or to pay its value if it was lost or destroyed)
2. to pay for any damage caused to the car
3. to pay such other damages suffered by Y as a consequence of the crime


What is a specific or determinate thing?

Something that is particularly designated or physically segregated from all others of the same class.


What is a generic or indeterminate thing?

Something that belongs to a class or genus to which it pertains and cannot be pointed out with particularity.


Duties of debtor in obligation to give a determinate thing

1. To preserve or take care of the thing due
2. To deliver the fruits of the thing
3. To deliver its accessions and accessories
4. To deliver the thing itself
5. To answer for damages in case of nonfulfillment or breach


Duties of debtor in obligation to deliver a generic thing

1. To deliver a thing which is of the quality intended by the parties taking into consideration the purpose of obligation and other circumstances

2. To be liable for damages in case of fraud, negligence, or delay, in the performance of his obligation, or contravention of the tenor thereof.


Different kinds of fruits

1. Natural fruits - spontaneous products of the soil and the young and other products of animals

2. Industrial fruits - produced by lands

3. Civil fruits - derived by virtue of a juridical relation


S sold his horse to B for P15,000. No date or condition was stipulated for the delivery of the horse. While still in the possession of S, the horse gave birth to a colt.

Who has the right to the colt?

In a contract of sale, "all the fruits shall pertain to the vendee from the day on which the contract was perfected. Hence, B is entitled to the cold.

But S has the right to the colt if it was born before the obligation to deliver the horse has arisen and B has not yet paid the purchase price.


Personal right v. Real right

PR: right or power of a person to demand from another the fulfillment of the latter's obligation to give, to do, or not to do.
RR: right or interest of a person over a specific thing without a definite passive subject against whom the right may be personally enforced.

PR: there is a definite active subject and a definite passive subject
RR: there is only a definite active subject without any definite passive subject

PR: binding or enforceable only against a particular person
RR: directed against the whole world.


How is ownership and real rights over property acquired?

Ownership and other real rights over property are acquired and transmitted by law, by donation, by testate and intestate succession, and in consequence of certain contracts by tradition or delivery.


Remedies of creditor in real obligation

1. Specific real obligation
a. demand specific performance or fulfillment (if still possible) with a right to indemnity for damages
b. demand rescission or cancellation with a right to recover damages
c. demand the payment of damages only

2. Generic real obligation
a. can be performed by a third person since the object is expressed only according to its family or genus
b. creditor has right to recover damages under Article 1170 in case of breach of obligation.


Can in indeterminate thing be the object of destruction by a fortuitous event?

No. Genus never perishes.


What is an accession?

Accessions are the fruits of, or additions to, or improvements upon a thing.


What is an accessory?

Accessories are joined to, or included with, the principal thing for the latter's embellishment, better use, or completion.


Right of creditor to accessions and accessories.

All accessions and accessories are considered included in the obligation to deliver a determinate thing although they may not have been mentioned.


In the phrase, "If a person obliged to do something fails to do it..." what are the situations contemplated here? (Art. 1167)

1. the debtor fails to perform an obligation to do
2. the debtor performs an obligation to do, but contrary to the terms thereof
3. the debtor performs an obligation to do but in a poor manner


Remedies of creditor in positive personal obligation?

1. If the debtor fails to comply with his obligation to do, the creditor has the right:
a. to have the obligation performed by himself, or by another unless personal considerations are involved, at the debtor's expense
b. to recover damages

2. In case the obligation is done in contravention of the terms of the same or is poorly done, it may be ordered by the court upon complaint that it be undone if it is still possible to undo what was done.


Remedies of creditor in negative personal obligation

1. Undoing of the forbidden thing plus damages.
2. If not possible to undo what was done, his only remedy is an action for damages caused by the debtor's violation of his obligation.


What is delay?

Failure to perform an obligation on time which failure, constitutes a breach of obligation.

Legal delay v. ordinary delay (failure to perform an obligation on time)


What are the kinds of delay?

1. Mora solvendi - delay on the part of the debtor to fulfill his obligation by a reason of a cause imputable to him

2. Mora accipiendi - delay on the part of the creditor without justifiable reason to accept the performance of the obligation

3. Compensatio morae - the delay of the obligors in reciprocal obligations


Requisites of delay

1. failure of the debtor to perform his (positive) obligation on the date agreed upon

2. demand (not mere reminder or notice) made by the creditor upon the debtor to fulfill, perform, or comply with his legal obligation which demand, may be either judicial or extra-judicial

3. failure of the debtor to comply with such demand


Explain demand and delay.

There is no delay if the obligation is not yet due or demandable. The creditor has the burden of proving that a previous demand has been made.


Effects of mora solvendi

a. the debtor is guilty of breach of the obligation
b. he is liable for interest in case of obligations to pay money or for damages in other obligations
c. he is liable even for a fortuitous event when the obligation is to deliver a determinate thing. However, if the debtor can prove that the loss would have resulted just the same even if he had not been in default, the court may equitably mitigate the damages.


The general rule is that delay is established only upon demand. What are the exceptions? When is demand not necessary?

1. When the obligation so provides
2. When the law so provides
3. When time is of the essence
4. When demand would be useless
5. When there is performance by a party in reciprocal obligations


Effects of mora accipiendi

a. the creditor is guilty of breach of obligation
b. he is liable for damages suffered, if any, by the debtor
c. he bears the risk of loss of the thing due
d. where the obligation is to pay money, the debtor is not liable for interest from the time of the creditor's delay
e. the debtor may release himself from the obligation by the consignation of the thing or sum due


Effects of compensatio morae

a. delay of obligor cancels out the effects of the delay of the obligee and vice versa

b. if the delay of one party is followed by that of the other, the liability of the first infractor shall be equitably tempered or balanced by the courts. If it cannot be determined which of the parties is guilty of delay, the contract shall be deemed extinguished and each shall bear his own damages.


Grounds for liability on breach of obligation

1. Fraud
- deliberate or intentional evasion of the normal fulfillment of an obligation

2. Negligence
- voluntary act or omission, there being no bad faith or malice, which prevents the normal fulfillment of an obligation. It is the failure to exercise that degree of care required by the circumstances. It may either result in culpa aquiliana or culpa contractual.

3. Delay

4. Contravention of the terms of the obligation


Importance of distinction between culpa contractual and culpa aquiliana

When liability arises from culpa aquiliana, not involving a breach of positive obligation, an employer or master may excuse himself under the last paragraph of Article 2180 by proving that he had exercised "all the diligence of a good father of a family to prevent the damage." -- not available from culpa contractual though this may mitigate damages.


Fortuitous event

Any extraordinary event which cannot be foreseen, or which, though foreseen, is inevitable.


Requisites of a fortuitous event

1. the event must be independent of the human will or at least of the obligor's will

2. unforeseeable and unavoidable

3. the event must be of such a character as to render it impossible for the obligor to comply with his obligation in a normal manner

4. the obligor must be free from any participation in, or the aggravation of the injury to the obligee.


What is a pure obligation?

One which is not subject to any condition and no specific date is mentioned for its fulfillment and is IMMEDIATELY DEMANDABLE.


Remedies available to creditors for the satisfaction of their claims

1. exact fulfillment (specific performance) with the right to damages

2. pursue the leviable (not exempt from attachment under the law) property of the debtor

3. after having pursued the property in possession of the debtor, exercise all the rights (like right to redeem) and bring all the actions of the debtor (like the right to collect from the debtor of his debtor) except those inherent in or personal to the person of the latter (such as the right to vote, to hold office, to receive legal support, to revoke a donation on the ground of ingratitude, etc.)

4. ask the court to rescind or impugn acts or contracts which the debtor may have done to defraud him when he cannot in any other manner recover his claim


What is a conditional obligation?

One whose consequences are subject in one way or another to the fulfillment of a condition.



A future and uncertain event.


What are the two principal kinds of condition

1. Suspensive condition (condition precedent or ex die) - the fulfillment of which will give rise to an obligation

2. Resolutory condition (condition subsequent or in diem) - the fulfilment of which will extinguish an obligation already existing


Classifications of obligations

1. Primary classification of obligations under the Civil Code
a. Pure and conditional obligations
b. Obligations with a period
c. Alternative and facultative obligations
d. Joint and solidary obligations
e. Divisible and indivisible obligations
f. Obligations with a penal clause

2. Secondary classification of obligations under the Civil Code
a. unilateral and bilateral obligations
b. real and personal obligations
c. determinate and generic obligations
d. civil and natural obligations
e. legal, conventional, and penal obligations

3. Classification of obligations according to Sanchez Roman
a. by their judicial quality and efficaciousness (natural, civil, mixed)
b. by the parties or subject (unilateral or bilateral, individual or collective, joint or solidary)
c. by the object of the obligation or prestation (specific or generic, positive or negative, real or personal, possible or impossible, divisible or indivisible, principal or accessory, simple or compound (conjunctive or distributive (alternative or facultative)))
d. By their juridical perfection and extinguishment (pure or conditional, with a period)


Characteristics of a condition

1. Future and uncertain
2. Future knowledge of a past event


Distinctions between suspensive and resolutory conditions

Suspensive: obligation arises when a condition is fulfilled
Resolutory: obligation is extinguished when a condition is fulfilled

Suspensive: if condition does not take place, the juridical tie does not appear
Resolutory: if the condition does not take place, juridical tie is consolidated

Suspensive: until the condition takes place, the existence of the obligation is a mere hope
Resolutory: the condition's effects flow but over it, hovers the possibility of termination


Condition imposed on the perfection of a contract v. condition merely imposed on the performance of an obligation

The former can extinguish the contract itself while the latter may give rise to other options.


When is obligation demandable at once?

1. when it is pure
2. when it is subject to a resolutory condition
3. when it is subject to a resolutory period


What is a period?

A future AND certain event


Is a juridical intervention needed when a resolutory condition is not met?



Classification of conditions

1. As to effect
a. supensive
b. resolutory

2. As to form
a. express
b. implied

3. As to possibility
a. possible
b. impossible

4. As to cause or origin
a. potestative
b. casual
c. mixed

5. As to mode
a. positive
b. negative

6. As to number
a. conjunctive
b. disjunctive

7. As to divisibility
a. divisible
b. indivisible


What is a potestative condition?

A condition suspensive in nature and which depends upon the sole will of one of the contracting parties.


What happens when the suspensive condition depends upon the will of the debtor?

1. Conditional obligation is void.
- where the potestative condition depends solely upon the will of the debtor, the conditional obligation shall be void because its validity and compliance is left to the will of the debtor

2. Only the condition is void.
- if the obligation is a pre-existing one, and therefore, does not depend for its existence upon the fulfillment by the debtor of the potestative condition, only the condition is void leaving unaffected the obligation itself. Here, the condition is imposed not on the birth of the obligation but on its fulfillment.


What happens when the suspensive condition depends upon the will of the creditor?

If the condition depends exclusively upon the will of the creditor, the obligation is valid.


What happens when the resolutory condition depends upon the will of the debtor?

If the condition is resolutory in nature, the obligation is valid although its fulfillment depends upon the sole will of the debtor. The fulfillment of the condition merely causes the extinguishment or loss of rights already acquired. The debtor is naturally interested in its fulfillment.


The position of the debtor when the condition is resolutory is exactly the same as that of the creditor when the condition is suspensive. T or F.



A condition which is both potestative (or facultative) and resolutory may be valid, even though the condition is left to the will of the obligor.



What is a casual condition?

If the suspensive condition depends upon chance or upon the will of the third person, the obligation subject to it is valid.


Two kinds of impossible conditions

1. Physically impossible
- when they, in the nature of things, cannot exist or cannot be done

2. Legally impossible
- when they are contrary to law, morals, good customs, public order, public policy


Effects of impossible conditions

1. Conditional obligation void
2. Conditional (negative) obligation valid
3. Only the affected obligation void


Requisites for constructive fulfillment of suspensive condition

1. the condition is suspensive
2. the obligor actually prevents the fulfillment of the condition
3. he acts voluntarily or intentionally


When to constitute the retroactive effects of fulfillment of suspensive condition?

1. In obligations to give - from the time the obligation is constituted, not from the time the condition is fulfilled (pag ganito, pure na yun)

2. In obligations to do or not to do - no fixed rule is provided. It is upon the court's discretion.


Rights before fulfillment of suspensive condition

1. rights of creditor - he may take or bring appropriate actions for the preservation of his right (general)
a. to prevent the loss or deterioration of object of the obligation or to enjoin acts of alienation/destruction
b. to prevent concealment of the debtor's properties which constitute the guaranty in case of non-performance
c. to demand security if the debtor becomes insolvent
d. to compel the acknowledgment of the debtor's signature on a private document or the execution of the proper public documents for registration so as to affect 3rd persons

2. rights of debtor - entitled to recover what he has paid by mistake prior to the happening of the suspensive condition


Article 1189
Rules in case of loss of thing during pendency of suspensive condition

1. If the thing is lost without the fault of the debtor, the obligation shall be extinguished

2. If the thing is lost through fault of the debtor, he shall be obliged to pay damages, it is understood that the thing is lost when it perishes, or goes out of commerce, or disappears in such a way that its existence is unknown or it cannot be recovered

3. When the thing deteriorates without the fault of the debtor, the impairment is to be borne by the creditor

4. If it deteriorates through the fault of the debtor, the creditor may choose between the rescission of the obligation and its fulfillment, with indemnity for damages in either case

5. If the thing is improved by its nature, or by time, the improvement shall inure to the benefit of the creditor

6. It is improved at the expense of the debtor, he shall have no other right than that granted to the usufructuary.


Kinds of loss

1. Physical loss - when a thing perishes as when a house is burned and reduced to ashes

2. Legal loss - when a thing goes out of commerce or when a thing becomes illegal

3. Civil loss - when a thing disappears in such a way that its existence is unknown or even if known cannot be recovered whether as a matter of fact or law


Requisites for application of Art. 1189

1. The obligation is a real obligation
2. The object is a specific or determinate thing*
3. The obligation is subject to a suspensive condition*
4. The condition is fulfilled
5. There is loss, deterioration, or improvement of the thing during the pendency of the happening on one condition


Obligations with a period

One whose consequences are subjected in one way or another to the expiration of said period or term.


Period v. Condition

1. As to fulfillment
- period is a certain event
- condition is an uncertain event

2. As to time
- period only refers to the future
- condition may also refer to a past event unknown to the parties

3. As to influence on the obligation
- period merely fixes the time for the efficaciousness of the obligation
- condition causes an obligation to arise or to cease

4. As to effect, when left to debtor's will
- period empowers the court to fix the duration thereof
- condition invalidates the obligation

5. As to retroactivity of effects
- unless there is an agreement to the contrary, the arrival of a period does not have any retroactive effect
- happening of a condition has retroactive effects


What is rescission?

It is the remedy available to an obligee when the obligor cannot or does not comply with what is incumbent upon him to abrogate their contract from the very beginning, with the right to payment of damages. It is the unmaking of a contract for a legally sufficient reason.


Kinds of period or term

1. As to effect
a. suspensive period - obligation begins only from a day certain upon the arrival of the period
b. resolutory period - obligation is valid up to a day certain and terminates upon the arrival of the period

2. As to expression
a. express
b. implied

3. As to definiteness
a. definite
b. indefinite

4. As to source
a. voluntary
b. legal
c. judicial


Is there recovery in personal obligations?

No. It is physically impossible to recover a service rendered.


In what cases does a debtor lose every right to make use of a period?

1. When after the obligation has been contracted, he becomes insolvent, unless he gives a guaranty or security for the debt

2. When he does not furnish to the creditor the guaranties or securities which he has promised

3. When by his own acts he has impaired said guaranties or securities after their establishment, and when through a fortuitous event they disappear, unless he immediately gives new ones equally satisfactory

4. When the debtor violates any undertaking; in consideration of which the creditor agreed to the period

5. When the debtor attempts to abscond


Kinds of obligation according to object

1. Simple obligation - only one prestation

2. Compound obligation - two or more prestations
a. conjunctive
b. distributive


What is an alternative obligation?

One wherein various prestations are due but the performance of one of them is sufficiently determined by the choice which, as a general rule, belongs to the debtor.


What are the limitations to the right of choice of the debtor in alternative obligations?

1. The debtor cannot choose those prestations which are: a. impossible b. unlawful or c. which could not have been the object of the obligation.

2. The debtor has no more right of choice, when among the prestations whereby he is alternatively bound, only one is practicable. The obligation becomes simple. The right does not pass to the creditor, not may it be exercised by any one.

3. The debtor cannot choose part of one prestation and part of another prestation.


Is the right of choice of debtor absolute in alternative obligations?

Although this is the general rule, it is not absolute. It may be exercised by the creditor only when
a. it is expressly granted to him
b. or by a third person when the right is given to him by common agreement.


What about alternative conditions in which the creditor has the right to choose?

[only when the choice has been expressly given to the creditor]

The responsibility of the debtor shall be governed by the following rules:
1. If one of the things is lost through a fortuitous event, he shall perform the obligation by delivering that which the creditor should choose from among the remainder, or that which remains if only one subsists

2. If the loss of one of the things occurs through the fault of the debtor, the creditor may claim any of those subsisting, or the price of that which, through the fault of the former, has disappeared, with a right to damages

3. If all the things are lost through the fault of the debtor, the choice by the creditor shall fall upon the price of any of one of them, also with indemnity for damages.

4. When all the things are lost through a fortuitous event, obligation will be extinguished.

The same rules shall be applied to obligations to do or not to do in case one, some or all of the prestations should become impossible.


What is a facultative obligation?

One where only one prestation has been agreed upon but the obligor may render another in substitution.


Alternative v. facultative obligation

1. Number of prestations
A - several prestations are due but compliance with one is sufficient
F - only one prestation is due although the debtor is allowed to substitute another

2. Right of choice
A - right of choice may be given to the creditor or third person
F - the right to make the substitution is given only to the debtor

3. Loss through fortuitous event
A - loss of one or more of the alternatives through a fortuitous event does not extinguish the obligation
F - the loss of the thing due extinguishes the obligation

4. Loss through fault of debtor
A - the loss of one of the alternatives through the fault of the debtor does not render him liable; where the choice belongs to the creditor, the loss of one alternative through the fault of the debtor gives rise to liability
F - the loss of the thing due through his fault makes him liable; the loss of the substitute before the substitution through the fault of the debtor does not render him liable

5. Nullity of prestation
A - nullity of prestation does not invalidate the others; the debtor or creditor shall choose from among the remainder
F - the nullity of the prestation agreed upon invalidates the obligation; the debtor is not bound to choose the substitute


What happens when only one of the alternative prestations is practicable?

The obligation is converted into a simple one.


It is the very nature of an alternative obligation that the debtor can make his choice without the consent of the creditor. T or F.



What is an individual obligation?

It is one where there is only one obligor and one obligee.


What is a collective obligation?

It is one where there are two or more debtors and/or two or more creditors. It may be joint or solidary.


What is a joint obligation?

It is one where the whole obligation is to be paid or fulfilled proportionately by the different debtors and/or is to be demanded proportionately by the different creditors.


What is a solidary obligation?

It is one where each one of the debtors is liable for the entire obligation and/or each one of the creditors has a right to demand entire compliance or satisfaction of the whole obligation from any or all of the debtors.


Is a collective obligation presumed to be joint?



In a distinct and separate obligation, the insolvency of one of the debtors shall not make the others liable. T or F.



What are the characteristics of a solidary obligation?

Unity of object and plurality of ties.


What is the essence of the solidarity?

Each and every one of the solidary creditors can demand and each of the debtors must satisfy the same prestation, with the resulting duty on the part of the creditor who received payment to pay to each of his co-creditors what belongs to him, and the resulting right on the part of the debtor who made payment to claim from his co-debtors the share which corresponds to each.


When can obligation be solidary?

Only when:
1. the obligation expressly so states
2. the law requires solidarity
3. the nature of the obligation requires solidarity
4. also when it is imposed in a final judgment against several defendants


Words used to indicate joint liability

mancum, mancomunada, mancomunadamente, pro rata, proportionately, pro rata, jointy, conjoint, "we promise to pay" signed by two or more persons


Words used to indicate solidary liability

severally, jointly and/or severally, solidaria, in solidum, solidarily, together and/or separately, individually and/or collectively, juntos o suparadamente, "I promise to pay" signed by two or more persons, individually and jointly


Kinds of solidarity

a. Passive (solidarity on the part of the debtors) - where anyone of them can be made liable for the fulfillment of the entire obligation. Its characteristics are plurality of debtors and unity of prestation

b. Active (solidarity on the part of the creditors) - anyone of them can demand the fulfillment of the entire obligation. Its essential feature is that of mutual representation among the solidary creditors with powers to exercise the rights of others in the same manner as their rights.


Is solidarity presumed?

No. Solidary obligations are very burdensome for they create unusual rights and liabilities.


What is a joint indivisible obligation?

The obligation is joint because the parties are merely proportionately liable. It is indivisible because the object or subject matter is not physically divisible into different parts.


In a joint indivisible obligation, the unwilling debtor shall be liable to damages to the creditor for having violated the obligation. The other debtors may also recover from the unwilling debtor. T or F.



The indivisibility of an obligation does not necessarily give rise to solidarity. Nor does solidarity of itself imply indivisibility. T or F.



Indivisibility v. solidarity

Indivisibility: refers to prestation
Solidarity: refers to the juridical tie

Indivisibility: only the debtor guilty of breach of obligation is liable for damages, thereby terminating the agency
Solidarity: all of the debtors are liable for the breach of the obligation committed by a co-debtor

Indivisibility: can exist although there is only one debtor and one creditor
Solidarity: there must be at least 2 debtors or 2 creditors

Indivisibility: the others are not liable in case of insolvency of one debtor
Solidarity: the others are proportionately liable


Each one of the solidary creditors may do whatever may be useful to the others, but not anything which may be prejudicial to the latter. T or F.



Can a solidary creditor assign his rights without the consent of the others?

No, because each creditor represents the others and the assignee may not have the confidence of the original solidary creditors.

If the assignment is made to a co-creditor, the consent of the other creditors is not necessary.


When a particular person demands payment from one of the debtors in a solidary obligation, to whom shall payment be made?

To the particular person demanding the payment.

The demand has the effect of terminating the mutual agency among the solidary creditors.


What are modes or causes of extinguishment of obligations?

Novation, compensation, confusion and remission. (not exclusive)


Effects of payment by a solidary debtor

1. Between the solidary debtors and creditors. Payment made by one of the solidary debtors extinguishes the obligation.

2. Among the solidary debtors. This does not create a real case of subrogation. It merely entitles him to claim reimbursement from his co-debtors "only the share which corresponds to each."

3. Among the solidary creditors. The receiving creditor is jointly liable to the others for their corresponding shares.


Rules in case thing has been lost or prestation has become impossible?

1. Loss is without fault and before delay - obligation shall be extinguished

2. Loss is due to fault on the part of a solidary debtor - the other debtors may recover from the guilty party after they contribute to the payment to the creditor

3. Loss is without fault but after delay - they shall still be liable


What is a constructive fulfillment?

When the obligor voluntarily prevents the fulfillment of the condition, the condition shall be deemed fulfilled.


Requisites of a constructive fulfillment (Sir Dindo)

1. intent of the obligor to prevent the fulfillment of the condition
2. actual prevention of the compliance


Can rescission be permitted for slight breach?

No. It can only be permitted for substantial breach.


Effects of rescission

1. Extinguishes the obligatory relation as if it had never existed
2. Mutual restitution to bring back the parties to their original situation prior to the inception of the contract


What is a reciprocal obligation?

It arises from the same cause and in which each party is a debtor and creditor of the other, such that the performance of one is designed to be the equivalent and the condition for the performance of the other.


What is loss?

When something perishes, goes out of the commerce of man, or disappears in a manner that its existence is unknown or cannot be recovered


What is deterioration?

It is the reduction or impairment in the substance or value of a thing which does not amount to a loss


What is an improvement?

When something's value is increased or enhanced by nature


Effect of notice of choice in an alternative obligation

1. The obligation ceases to be alternative and becomes simple
2. The choice becomes irrevocable


Where will indemnity depend on in an alternative obligation?

The indemnity shall be fixed taking as a basis the value of the last thing which disappeared, or that of the service which last became impossible


What is a divisible obligation?

It is one the object of which, in its delivery or performance, is capable of partial fulfillment


What is an indivisible obligation?

It is one the object of which, in its delivery or performance, is not capable of partial fulfillment


Even if the object or service may be physically divisible, an obligation is indivisible if so provided by law or intended by the parties. T or F.



An obligation is presumed indivisible where there is only one creditor and only one debtor. T or F.



Kinds of indivisibility

1. Legal indivisibility - where a specific provision of law declares a indivisible, obligations, which, by their nature, are divisible.

2. Conventional divisibility - where the will of the parties makes as indivisible, obligations which, by their nature are divisible

3. Natural indivisibility - where the nature of the object or prestation does not admit of division (car, song, etc.)


Obligations presumed to be indivisible

1. Obligation to give definite things

2. Obligations which are not susceptible of partial performance (except if more than one participant)

3. Obligations provided by law to be indivisible even if thing or service is physically divisible (tax)

4. Obligations intended by the parties to be indivisible even if thing or service is physically divisible


Obligations deemed divisible

1. Obligations which have for their object the execution of a certain number of days of work

2. Obligations which have for their object the accomplishment of work by metrical units

3. Obligations which by their nature are susceptible of partial performance


What is a principal obligation?

It is one which can stand by itself and does not depend for its validity and existence upon another obligation


What is an accessory obligation?

It is one which is attached to a principal obligation and therefore cannot stand alone


What is an obligation with a penal clause?

It is one which contains an accessory undertaking to pay a previously stipulated indemnity in case of breach of the principal prestation intended primarily to induce its fulfillment


What is a penal clause?

It is an accessory undertaking attached to an obligation to assume greater liability on the part of the obligor in case of breach of the obligation.


Purposes of penal caluse

1. To insure their performance by creating an effective deterrent against breach
2. To substitute a penalty for the indemnity for damages and the payment of interests in case of non-compliance
3. To punish the debtor for the non-fulfillment or violation of his obligation


Is a forfeiture clause in a contract penal in nature?



Penal clause v. condition

P: constitutes an obligation although accessory
C: does not

P: may become demandable in default of the unperformed obligation and sometimes jointly with it
C: never demandable


Are obligations with penal clause strictly construed?



Conditional, alternative and facultative obligations v. penal clause

P: there is a principal obligation to which the accessory obligation of penal clause is joined - expressly granted

C: existence of the obligation is uncertain

A: two things are due alternatively

F: there is only one thing due notwithstanding the right conferred upon the debtor to satisfy the obligation by substituting another in its place


Kinds of penal clause

1. As to origin
a. legal - by law
b. conventional - by stipulation

2. As to its purpose
a. compensatory or reparatory - damages
b. punitive - punishment for breach

3. As to its dependability or effect
a. subsidiary or alternative - only one penalty can be enforced
b. joint or cumulative or complementary - when both the principal obligation and the penal clause can be enforced


Penalty, damages, and/or interests

1. Penalty substitutes for damages and interests (general rule)

2. Penalty and interest enforceable (by agreement)

3. Penalty, damages, and interests enforceable
a. when so stipulated by the parties
b. when the obligor refuses to pay the penalty
c. when the obligor is guilty of fraud

4. Requirement to make penalty enforceable - when demandable in accordance with the provisions of Civil Code


Penalty is not a substitute for performance

Yes. Otherwise, if this is allowed, it is just an alternative obligation.


Is proof of actual damages suffered by the creditor necessary in order that the penalty may be demanded?

No. Only in cases wherein the damages may be recovered in addition to the penalty.


May penalty be reduced by the Courts?



In what cases may fruits be recovered?

1. when the obligation is reciprocal, and there has been premature performance on both sides

2. when the obligation is a loan on which the debtor is bound to pay interest

3. when the period is exclusively for the benefit of the creditor


Effect of substitution

1. Obligation is converted to a simple one to deliver or perform the substituted prestation

2. Substitution becomes effective from the time it has been communicated

3. If the principal prestation is lost after the substitution, the debtor is no longer liable.


When does an obligation deliver arise?

1. Obligations subject to a suspensive condition - upon happening of the event

2. Obligations subject to a suspensive period - from the moment the period expires

3. If there is neither a period or condition - upon perfection of contract

4. Obligations arising from sources other than contracts (law)

5. In contract of sale, the obligation arises from the perfection of the contract even if the obligation is subject to a suspensive condition or a suspensive condition where the price has been paid


Elements of a contract

1. Consent
2. Object
3. Cause of action


The ownership of things is transferred not by mere agreements but by delivery. T or F.



Kinds of breach of obligations

1. Substantial
2. Casual/Slight


Modes of breach of obligations

1. Fraud
2. Dolo incidente
3. Dolo causante


Exceptions to the requirement that an obligation must be demandable and liquidated in mora solvendi

1. when the obligation so provides
2. when the law so provides
3. when time is of the essence
4. when demand would be useless


What is an accion subragatoria?

an action where the creditor whose claimes had not been fully satisfied, may go after the debtors (third persons) of the defendant-debtor

the action wherein the creditor may exercise in the place of his negligent debtor in order to preserve or recover for the patrimony of the debtor the product of such action, then obtain therefrom the satisfaction of his own credit


Requisites of accion subragatoria

a. Debtor must be insolvent

b. Malicious or negligent inaction of the debtor might endanger the claim of the creditor

c. The credit of the debtor against a 3rd person is certain, demandable and liquidated

d. The debtor's right against the 3rd person must be susceptible of being transformed to patrimonial value for the benefit of the creditor.


A si debtor. B creditor. A asawa ni C. C is obliged to give support to A. Pwede maapply ang accion subragatoria?

NO. Kasi for support yun.


A debtor. B creditor. si A may family home. Can accion subrogatoria apply?

No. Family home is exempt from execution.


Exceptions in accion subragatoria

Exceptions - inherent rights of debtor
a. right to existence (support)
b. rights or relations of a public character
c. rights of an honorary charatcer
d. powers which have not been used including 1) power to administer 2) power to carry out an agency or deposit and 3) power to accept a contract offer
e. non-patrimonial rights


What is an accion pauliana?

- the right to revoke the acts which the debtor may have done to defraud his creditors

- it is an action of last resort. Tolentino believes that new debts do not fall under the scope of accion pauliana
*the credit should antedate the fraudulent conveyance of the debtor

A debtor. B creditor. A may properties. Nagdodonate sya ng mga properties sa ibang tao. Ayaw nya bayaran si B. Lubog ka na sa utang, nagdodonate ka pa. Creditor has a right to revoke the contract.
- subsidiary remedy. All legal remedies must be exhausted first.
- only applies in fraudulent acts


When does insolvency occur?

Insolvency occurs when liabilities are greater than your assets.


Requisites of insolvency

a. a trial court judgment with a writ of execution
b. the sheriff's failure to enforce the judgment
c. the creditor has exhausted all of the debtor's property
d. all legal remedies must be exhausted first


a father. b son. si a mayaman. yung yaman ba ni a ay yaman din ni b?

No. Although may inchoate rights sya dun sa properties because those properties will be inherited upon a's death. inchoate - not a present right but you will eventually incur such. succession only commences upon the time of the death.


Exceptions to fortuitous event

1. expressly specified by law (1942, 2001, 2147, 552)
2. Stipulation of parties
3. Assumption of risk
4. fraaud or malice
5. debtor already in delay
6. debtor guilty of concurrent negligence
7. liability arising from a criminal act except if debtor tenders thing and creditor unjustifiably refuses to receive


Transmissibility of rights

- all rights acquired in virtue of an obligation are transmissible (1178)
1. prohibited by law (righrs in partnership, agency, and commodatum) trust and confidence
2. prohibited by stipulaation of the parties


*In reciprocal oligations, there is no retroactivity re: fruits since they are deemed to have been mutually compensated
Reciprocal Obligations - both parties are creditors and debtors
Ex: A will deliver a piece of land to B who will pay 10k and the agreement is subject to a suspensive condition. Upon the happening of the suspensive condition, A will only deliver the land (w/o fruits) and B will only pay 10k (w/o interest) - mutually compensated



What is an inchoate interest?

Interests, generally property interests, that are likely to vest but have not yet actually done so. The inchoate interest usually is dependent on an event occurring that triggers the interest, such as a relative s death triggering an inheritance


Effect of loss or deterioration

i. without debtor's fault - (loss) obligation shall be extinguished (deterioration) impairment is to be borne by the creditor

ii. with debtor's fault - (loss) debtor is obliged to pay damages (deterioriation) creditor may choose between the rescission of the obligation and its fulfillment, with indemnity for damages in either case


Benefits of period

a. creditor - creditor may demand fulfillment even before the arrival of the term but the debtor cannot require him to to accept payment before the expiration of the stipulated period
- the acceptance of partial payment amounts to a waiver of the period agreed upon.

b. debtor - debtor cannot be compelled to pay prematurely, but he can, if he desires to do so

The presumption is that the period is for the benefit of both creditor and debtor, unless from the tenor of the circumstances it should appear that the period has been established in favor of one or of the other.


General legal interest pag wala sa stipulation

6% per annum


When may the courts fix a period?

1. when peirod is implied
- the obligation does not fix a period but it can be inferred from its nature and the circumstances that a period was intended

2. when the period depends solely on will of debtor - the court must fix the period to forestall the possibility that the obligation may never be fulfilled

3. when the debtor pays according to which his means may so provide


When does notice produce effects in alternative obligations?

The notice produces effect from the time it has been communicated.

The notice may be made
1) orally
2) in writing *** eto praktisin nyo palagi kasi kailangan palaging may proof
3) tacitly
4) by any other unequivocal means

- when there are various debtors or creditors, and the obligation is joint, the consent of all is necessary to make the selection effective, because none of them can extinguish the entire obligation


Kinds of solidary obligation

a. as to source
i. legal - solidarity is imposed by law
ii. conventional - where solidarity is agreed upon by the parties
iii. real - solidarity is imposed by obligation

b. as to parties found
i. passive
ii. active
iii. mixed

c. as to uniformity
i. uniform
ii. varied



a. Types
i. Those derived from the nature of the obligation (examples: non-existence of the obligation bc of illicit cause or onject, nullity due to defect in capacity or consent of all debtors, such as minority, mistake, fraud, etc., extinguishment of the obligation)
ii. Personal Defenses
iii. Defenses Pertaining to his share
- they may either be a total or partial defense
- total: insanity will serve as complete exemption
iv. Those personally belonging to other co-debtors
- the debtors who is sued may set up defenses which are personal to the other solidarity debtors



offering or depositing of payment to the court


Money is divisible paano magiging indivisible ang performance?