ORIENTATIONandIntroduction to LawCity Prosecutor Janet Grace B. Dalisay-Fabrero

COURSE SYLLABUS

COURSE NO:BL 1 COURSE TITLE: LAW ON OBLIGATIONS AND CONTRACTINSTRUCTOR:ATTY. JANET GRACE DALISAY- FABRER0SCHOOL YEAR:1st Semester 2014

General Objectives: To enable students to know, understand and master the legal principles governing the law on obligations and contracts;To assist and guide students to develop analytical approach in the practical applications of these legal provisions on obligations and contracts to business problems and cases;To enable students to relate these legal provisions and principles to their day-to-day activities, to their business courses as well as to their future endeavors;To guide students in developing analytical approach in understanding legal provisions vis--vis the jurisprudences rendered by the Supreme Court.To prepare students for the CPA Board Examination.

Official Textbook: The Law on Obligations and Contracts By Hector S. De Leon

Other References: Law on Obligations and Contracts By: Renato Pasimio Law on Obligations and Contracts By: Miguela Ancheta Luna Law on Obligations and Contracts By: Justo P. Torres Civil Code of the Philippines, Annotated Vol. IV By: Edgardo L. Paras

Grading System: For each Grading: Quizzes 50% Long Quiz 48% Deportment/Attendance 2%_____100% Final Grade: Three Gradings/3 75% Departmental Exam 25% _______ 100%

Main Requirements:Passing Percentage of the total quizzes which is least Three (3) Quizzes per gradingOne (1) Long Exam Per Grading Recitation Departmental ExaminationAdditional Requirements:Case Research and Digesting Court Exposure (optional) Case Analysis/Problem SolvingFilm Viewing (optional)Drafting of Contracts

INTRODUCTION TO LAW

ReflectionAssuming you were given by a scientist/inventor friend a highly innovative, complicated newly invented machine, aside from saying thank you what do you think the most appropriate thing to ask or do regarding said machine?

The answer is simple. Follow his instructions. Follow the machine manuals instructions and the machine will work.

A manual is one required to know how this machine can work properly and appropriately. It contains the INSTRUCTIONS the every user needs.

How can the human machine this strange, lovable and complex machine called Man, with its mortal body and its eternal soul be made to function well? The answer is also simple: Follow the instructions of its Maker. Unless this is done, the human machine will become futile, senseless object, utterly incapable of fulfilling its destiny. These instructions from the maker we call the LAW

Law defined on its Most Generic SenseLaw may be defined in its most generic sense as an ordinance of reason promulgated for the common good by HIM who is in-charge.

Law as defined in the Widest/Comprehensive termThe term law means any rule of action or any system of uniformity.

Thus law in general determines not only the activities of men as rational beings but also the movement or motions of all objects of creation, whether animate or inanimate

General Divisions of LawLaw (in the strict legal sense) which is promulgated and enforced by the STATEExample STATE LAW2. Law (in the non-legal sense) which is not promulgated by the StateExample Divine law, natural law, moral law and physical law

General Divisions of LawState law, divine law, natural law and moral law are comprised in the definition of law as RULE OF ACTION. These laws apply to rational beings only.

Physical law operates on all things including men without regards to the latters use ofWill power and intelligence. It isCalled law only in figurative sense.

DIVINE LAWThis law refers to the law of religion and faith and focuses with the concept of SIN.

It is under the field of philosophical theology

DIVINE LAWLaw is promulgated by GOD and revealed to mankind by means of direct revelation.

The sanction of divine law lies in the assurance of certain rewards and punishment in present life to come. Example: Divine law under the Old Testament is embodied in the Ten Commandments. To the Mohammedans, divine law is embodied in the Quoran.

NATURAL LAWNatural law may be defined as the divine inspiration in mans sense of justice, fairness and righteousness not by divine revelation but by mans internal dictates of reason alone.

There is in every man a basic understanding of right and wrong based on an understanding of the fundamental standard or criterion of good and evil.

NATURAL LAWThere are some acts or conduct which man knows in his heart and his conscience not by theorizing by dictates of his moral nature are simply good or bad or evil.Natural is impressed in man as the core of his higher self at the very moment of being or perhaps even before that,It is regarded as the reasonable basis of STATE LAW and belongs to the field of METAPHYSICS.

MORAL LAW Moral law represents the totality of the norms of good and right conduct growing out of the collective sense of right and wrong of every community.

The mores or ways of life were then evolved which were always considered right and correct and obedience to them may be demanded by the group.

MORAL LAW Moral law has no definite legal sanction. If a member of the community disregards the moral norms, a spontaneous social reaction is produced in the form of public displeasure, contempt or even indignation. Moral law is not absolute as it varies with the changing times.

Moral law, to a great extent, influences or shapes STATE LAW and under the field of ETHICS.

PHYSICAL LAWAphysical laworscientific lawis "a theoreticalprinciplededuced from particular facts, applicable to a defined group or class ofphenomena, and expressible by the statement that a particular phenomenon always occurs if certain conditions be present.A property of a physical phenomenon, or a relationship between the various quantities or qualities which may be used to describe the phenomenon, that applies to all members of a broad class of such phenomena, without exception.

PHYSICAL LAWOver the years, one thing scientists have discovered is that nature is generally more complex than we give it credit for. The following laws of physics are considered fundamental, but many of them refer to idealized, closed systems, which are hard to obtain in the real world. Also, some are altered slightly in different circumstances. The laws that Newton developed, for example, are modified by the findings of thetheory of relativity, but they are still basically valid in most regular cases that you'll run into. Other examples Newton's Three Laws of Motion Law" of Gravity:

CONCEPTS OF LAWConsidered as a cause derecho is the abstract science of law; Considered as an effect, it is the given.

Ley is a specific law.

Example : A student of law (derecho) studies specific laws (leyes).

STATE LAWState law means law that is promulgated by the StateOther terms used POSITIVE LAW or HUMAN POSITIVE LAW, MUNICIPAL LAW, CIVIL LAW OR IMPERATIVE LAWAs a rule of action, only the state can enforce it.

STATE LAW IN ITS GENERAL SENSEState law is defined by the late Senator Arturo Tolentino (Also a civil law expert of the Philippines) as the mass of obligatory rules established for the purpose of governing the relations of persons in the society. Examples of use of law in these sense: rule of law and not of men; equality before the law

STATE LAW IN ITS SPECIFIC SENSEState law in specific sense has been defined as a rule of conduct, just, obligatory, promulgated by legitimate authority and of common observance and benefits. (Sanchez Roman)State law or human positive law is a reasonable rule of action, expressly or indirectly promulgated by proper human authority for the common good and usually but not necessarily imposing a sanction in case of disobedience.

STATE LAW IN ITS SPECIFIC SENSEElements/Characteristics of State LawIt is a rule of conduct comprising of reasonable rules of actionIt is obligatory there must be positive command imposing it as a duty. Usually but not necessarily carries with it sanctions to ensure obedience and compliance.

STATE LAW IN ITS SPECIFIC SENSEc. It is promulgated by legitimate authority. Meaning the persons promulgating the law have the power to bind. While competency is ideally expected from person promulgating the law, this is not strictly the requirement for validity and enforceability of the law.d. It is of common observance or benefit It is one intended to serve man. It regulates relations of men to maintain harmony in the society.

NECESSITY AND FUNCTION OF LAWFunctionsLaw secures justice resolves conflict orders society protects interest controls social relations

IN OTHER WORDS, NO SOCIETY CAN LAST AND CONTINUE WITHOUT MEANS OF SOCIAL CONTROL, WITHOUT RULES ON SOCIAL ORDER BINDING ON ITS MEMBERS

SOURCES OF LAW IN THE PHILIPPINESConstitution the fundamental law of the law being deemed to be promulgated by the people themselves. All other legislations of the country must be in consonance with the Constitution. Present Constitution is the 1987 Philippine Constitution Define Constitution: written instrument by which the fundamental powers of the government are established, limited and defined and by which these powers are distributed among the several departments for their safe and useful exercise for the benefit of the people ( Malcolm and Laurel, Philippine Constitutional law)

SOURCES OF LAW IN THE PHILS.Legislation the legislative department of the Philippine is the CONGRESS comprising of the house of senate and the house of representatives. The laws passed by Congress are known as statutes or laws. Those laws passed by legislative bodies of the local government units such as Sangguniang Panlalawigan, Sangguniang Panglusod are known as ordinances

SOURCES OF LAW IN THE PHILS.Administrative or executive orders, regulations and rulingsLaw making power legislative exerciseRule making power administrative exercise. If laws are passed by Congress, the executive body is mandated to enforce these laws. To guide the executive body in enforcement of these laws, the executive is duly empowered to pass rules and regulations governing the implementation of these laws. This is an exercise of its rule making power.

SOURCES OF LAW IN THE PHILS.

Rules and regulations passed by the by, executive body are intended to clarify or explain the law and carry into effect its general provision. They must not be contrary to laws and the Constitution.

SOURCES OF LAW IN THE PHILS.4. Judicial decisions or jurisprudenceSUPREME COURT it is the highest court of the law and is empowered to interpret the laws of the land.

Jurisprudence refers to decisions of the Supreme Court on a particular case which are binding to all lower courts, meaning it must be made as guidance and applicable in rendering decision on cases of similar facts and circumstances to ensure uniformity in interpretation of the law. Decision of the Supreme Court on a particular issue is part of the legal system of the country. Decision of SC being binding to all lower courts is based on the doctrine of PRECEDENT or STARE DECISIS.

SOURCES OF LAW IN THE PHILS.Decision of the lower court binds only the parties of the case and not binding upon other courts rendering similar facts or circumstances. What is binding to lower courts would be the jurisprudence of the SC.

Be it noted that rulings of the SC is pro-active and dynamic. Meaning SC may reverse or modify its previous rulings and for this reason, judges and lawyers must be abreast of the changing character of the law and jurisprudence from time to time.

SOURCES OF LAW IN THE PHILS.5. Customs- it consists of those habits and practices which through long and uninterrupted usage have become acknowledged and approved by society as binding rules of conduct. It has the force of law when recognized and enforced by law.A custom must be proved as fact according to the rules of evidence. (Art. 12, Civil Code)

SOURCES OF LAW IN THE PHILS.6. Other sources Principles of justice and equityDecisions of foreign tribunalsOpinions of text writers and religion.They are however only supplementary, that is, they are resorted to by the courts in the absence of all the other sources. They are, however, not binding on the courts.

RULES IN INTERPRETATIONOur Civil Code provides that no judge or court shall decline to render judgment by reason of the silence, obscurity or insufficiency of the laws. (Art. 9, Civil Code)

In case of the doubt in the interpretation or application of laws, it is presumed that the law making body intended right and justice to prevail. (Art. 10)

In our country, courts are not only courts of law but also of justice.

ORGAN OF SOCIAL LAW

Law is not an end in itself. It may be viewed as a means of SOCIAL CONTROL- the control of social behaviour that affects others.

ORGANIZATION OF COURTS

ORGAN OF SOCIAL LAW

Law is not an end in itself. It may be viewed as a means of SOCIAL CONTROL- the control of social behaviour that affects others.

ORGANIZATION OF COURTS

JURISDICTION OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS/MUNICIPAL CIRCUIT TRIAL COURTSCivil (1) Exclusive (EOJ) o Actions involving personal property valued at not more than 300K/400K o Actions demanding sum of money not exceeding 300K/400K Includes admiralty & maritime cases o Probate proceedings where gross value of estate does not exceed 300K/400K o Actions involving title/possession of real property where assessed value does not exceed 20K/50K o Provisional remedies in principal actions within their jurisdiction

JURISDICTION OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS/MUNICIPAL CIRCUIT TRIAL COURTSo Summary Procedure Forcible entry and unlawful detainer Irrespective of amount of damages or unpaid rentals sought to be recovered Other cases where total of the claim does not exceed 100K/200K o Inclusion and exclusion of voters

JURISDICTION OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS/MUNICIPAL CIRCUIT TRIAL COURTS (2) Delegated o Cadastral and land registration cases No controversy or opposition, and Contested lots valued at more than 100K

(3) Special o Petition for Habeas Corpus In the absence of all RTC judges

JURISDICTION OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS/MUNICIPAL CIRCUIT TRIAL COURTS B. Criminal (1) Exclusive o Summary Procedure Violations of traffic laws, rules and regulations Violations of rental law Violations of city/municipal ordinances committed w/in territorial jurisdiction Offenses punishable with imprisonment of not more than 6 months, or a fine not exceeding 1K, or both

JURISDICTION OF THE METROPOLITAN TRIAL COURTS, MUNICIPAL TRIAL COURTS/MUNICIPAL CIRCUIT TRIAL COURTS

Regardless of other impossible accessory or other penalties and civil liability arising therefrom Offenses involving damage to property through criminal negligence where imposable fine does not exceed 10K o Offenses punishable with imprisonment of not more than 6 years Irrespective of fine Regardless of other impossible accessory

JURISDICTION OF THE REGIONAL TRIAL COURTSCIVIL 1) Exclusive o Other cases where demand or value of property in controversy exceeds 300K/400K o Actions in admiralty & maritime jurisdiction where demand/claim exceeds 300K/400K o Probate proceedings where gross value of estate exceeds 300K/400K o Actions involving title/possession of real property where assessed value exceeds 20K/50K o Actions not capable of pecuniary estimation o Cases not falling within EJ of any court, tribunal, person or body exercising judicial or quasi-judicial functions

JURISDICTION OF THE REGIONAL TRIAL COURTSo Under Securities & Regulation Code Devices or schemes employed by the board of directors, business associates, its officers or partnership, amounting to fraud or misrepresentation Controversies arising out of intra-corporate partnership relations Controversies in the election or appointment of directors, trustees, officers, or managers of such corporation, partnership or association Petition to be declared in a state of suspension of payments o Application for issuance of writ of search and seizure in civil actions for infringement of intellectual property o Violations of Anti-Money Laundering Act

JURISDICTION OF THE REGIONAL TRIAL COURTS B.Criminal (1) Exclusive o Not within the EJ of any court, tribunal, or body Offenses punishable with imprisonment of more than 6 years irrespective of fine Offenses not falling within EOJ of Sandiganbayan None of the accused is occupying a position corresponding to salary grade 27 and higher o Only penalty provided by law is a fine exceeding 4K o Jurisdiction to impose the maximum and most serious penalty imposable for an offense forming part of the complex crime

JURISDICTION OF THE COURT OF APPEALS A. Exclusive (1) Annulment of judgments of RTC (2) Petitions under Rule 65 involving an act or omission of a quasi-judicial agency

JURISDICTION OF SUPREME COURT A. Exclusive Petitions under Rule 65 (Rules on Appeal) against: o CA o COMELEC o COA o Sandiganbayan o CTA en banc o Ombudsman in criminal and non-administrative disciplinary cases

Classification of LawAs to purposeSubstantive law creates and defines rights and duties either public or private in characterAdjective (procedural) law prescribes the manner or procedure by which rights or duties are enforced.

Classification of the law: public law and private lawPublic lawregulates the interaction of citizens with the state (e.g. criminal law, constitutional law, administrative law)Private lawregulates the relationship between individuals within a state (e.g. Obligations and contracts law, tort law, property law)

Public lawadministrative lawconstitutional lawcriminal lawInternational law

Private lawCIVIL LAW (law on Obligations and Contracts, Property etc)COMMERCIAL OR MERCANTILE LAWCIVIL PROCEDURE

Classification of the law: criminal law and civil lawcriminal lawgenerally aims to punish

civil lawgenerally aims to compensate

Classification of LawAccording to FORCE or EFFECTMandatory ( absolute, imperative) and/or Prohibitive laws those which have to be complied with, because they are expressive of public policy; disobedience is punished either by direct penalties or by considering an act or contract void.Permissive (or suppletory) laws those which may be deviated from, if the individual so desires. ( In the case of hidden treasure the finder gets 50% and the owner of land on which it is found gets 50% (See 438) However by agreement the proportion can be changed.

Civil law in the PhilippinesMost of our civil laws are found and codified in the Civil Code of the Philippines (REPUBLIC ACT NO. 386) which took effect on August 30, 1950.

The civil code contains 2270 articles.

Prior to the R.A. No. 386, the civil laws in the Philippines were based on the Old Civil Code of Spain of 1889

Civil law in the PhilippinesMeaning of Civil Law It is that branch of law that treats of the personal and family relations of an individual, his property and successional rights and the effects of his obligations and contracts.The word civil is derived from the Latin term civiles a citizen as distinguished from a savage or barbarian.

Civil law in the PhilippinesWhile most of our laws are found in the Civil Code still the Civil Code is not the only place where we can find our civil laws. The Civil Code is a compilation of existing civil laws, scientifically arranged into books, titles, chapters and sub-heads and promulgated by the legislative authority. From time to time, legislations are added, modifying, amending or abandoning previous civil law(s).

BOOKS OF THE CIVIL CODE OF THE PHILIPPINESBook I Persons ( as amended by the Family Code of the Philippines E.O No, 209)Book II Property, Ownership and Its ModificationBook III- Different Mode of Acquiring OwnershipBook IV Obligations and ContractsOther PartsPreliminary TitleHuman RelationsTransitional ProvisionsRepealing Clause

LAW ON OBLIGATIONS AND CONTRACTSThis law is found in Book IV of Republic Act No. 386 or the New Civil Code of the Philippines. ARTICLES 1156 TO 1304 Law on Obligations (149 articles)ARTICLES 1305 TO 1422 Law on Contracts (118 articles)ARTICLES 1423-1430- Natural Obligations (8 articles)Total of 275 articles to be taken up excluding law on damages ( 41 articles -Arts. 2195 to 2235) and new FRIA law (Financial Rehabilitation and Insolvency Act)

LAW ON OBLIGATIONS AND CONTRACTS

Law on Obligations and Contracts: It is the body of rules which deals with the nature and sources of obligations and rights and duties arising from agreements and particular contracts.

APPLICABILITY OF LAWIgnorantia juris non excusatorignorantia legis neminem excusat(Latinfor "ignoranceof thelawdoes not excuse" or "ignorance of the law excuses no one")It is a legal principle holding that a person who is unaware of a law may not escapeliabilityfor violating that law merely because he or she was unaware of its content.Under the Philippine laws, there is conclusive presumption that everyone knows the law. This is to give effect to the so called FORCE OF LAW.

**There are many ways to classify laws and no one method of categorisation is necessarily any better than another. Public law deals with those areas of law where the interests of the public are the overriding factor. Private law deals more with individual rights and the relationships between private citizens.*Looking briefly at some of these categories of law:Administrative lawAs you will see later, Parliament makes laws and the executive, the government, carries these laws out. The government administers the laws that Parliament makes. Also, Parliament sometimes delegates its law-making powers to other persons or bodies. These delegates can be Ministers of the Crown, civil servants, councils and other government or semi-government bodies.There is a need to see that laws are administered properly and that delegated legislators do not exceed the powers delegated to them. This need is most commonly filled by the power of the courts to review the actions of those who exercise delegated powers.Parliament has also created special tribunals such as the Administrative Appeals Tribunal to review and correct administrative actions.Constitutional lawConstitutional law involves the study and practice of the laws and procedures of the constitutions of countries and states. In Australia, we have a written constitution that establishes the Commonwealth of Australia. It regulates the legislative, law-making, powers of the Parliaments of the Commonwealth and of the several States. The Constitution also regulates the relationship between the two Commonwealth Houses of Parliament. The respective States have constitutions that regulate the relationships between the Houses of Parliament of that State.Constitutional law involves much more than a study of written constitutions. There are also the unwritten conventions of the Constitution and the Acts that govern parliamentary representation. For example, as you will see later, the Queen, who is the titular head of the British constitutional and legal system, has, in theory, the power to arbitrarily dismiss the government. In practice, this has not occurred for hundreds of years and it is a constitutional convention that she will not do this. These constitutional conventions also apply in Australian constitutional law but there are differences.Industrial lawIndustrial law has a public and a private component. The contract of employment that regulates the legal relationship of employer and employee falls within the category of private law.Today, however, many employees are members of industrial unions and these employees do not negotiate their terms of employment individually. Often industrial unions representing the employees and employers organisations representing employers fix these wages by negotiation.The payment of wages, and industrial conditions generally, can affect the nations economy. Consequently, the government, representing the community, has a vital interest in the employment of workers. Often the government will intervene where a change in working conditions is sought or resisted. This brings this area of law within the category of public law.Another public aspect of working conditions is the frequency of industrial accidents and work-related injuries. The community has an interest in the general welfare and safety of its members. Also, some employees may suffer an injury at work and be unable to continue in employment, whether temporarily or permanently. these employees might, without proper compensation schemes, become a burden on the communitys social welfare system.So, the practice of public industrial law, if we can use that term, would cover the following areas:the industrial relationship between employers and employeesworkers compensationindustrial safety regulationTaxation lawThe Commonwealth of Australia and the States spend large sums of money for purposes of government. The administration of justice, social services, education, health and defence are but a few of these areas of expenditure.Governments can only raise these moneys by taxation of one kind or another upon the community. This taxation may consist of income taxation, customs duties, excise duties or taxation on the ownership of land.It is obvious that the average citizen does not wish to pay any more tax than legally necessary. Conversely, governments have a vital interest in ensuring that citizens do not avoid their obligation to pay taxes. As a result, taxation laws tend to be complex and lengthy. Although individual cases might properly come within the cloak of private law, taxation law falls properly under the category of public law.

Carvan, 4th ed*You will cover some of these areas of law in this subject. Others will be looked at in other law subjects.*Criminal lawAs we have already discussed the essence of a crime is that it is a wrong against the community even though the criminal action may cause harm to only one person. The offence may be a wrong against the morality of the community, or it may threaten the peace and order of the community or it may conflict with the established policy of the governing body of that community.As a crime is considered an offence against the community, it is logical that proceedings against the offender should be instigated in the name of the community.The normal penalty for a breach of the criminal law is a jail sentence or a fine. A fine is a monetary penalty, collected for the community.