Oblicon Notes 2014 - Atty. San Pedro (rAW)

1156:Anobligationisajuridicalnecessitytogivetodoornottodo.Elements:Obligation(obligaretobind)Ex:ApromisestopaintBspictureforBasaresultofanagreement.a.Activesubject(oblige/creditor)possessoroftheright;heonwhosefavortheobligationisconstituted(A)b.Passivesubject(obligor/debtor)dutyofgiving,doing,ornotdoing.(B)c.Objectorprestationsubjectmatterofobligation;mayconsistofgiving,doingornotdoing(picture)d.Efficientcause(vinculum/juridicaltie)reasonofobligation(Contract/agreement)e.FormmannerofmanifestationJuridicalNecessitynon-compliancecanresultinajuridicalorlegalsanctionKindsofobligationa.Viewpointofsanction1.Civil(perfect)per1156;sanctionisjudicialprocess2.Naturaldutynottorecoverwhathasvoluntarilybeenpaidalthoughpaymentwasnolongerrequired;sanctionislawbecauseconsciencemotivatedpayment;Ex:AowesB1M,AknowingthatthedebthasprescribedpaysB.Acannotgetbackwhathepaid.3.Moral(imperfect)-dutyofcatholictohearmass;sanctionconscienceormoralityb.Viewpointofsubjectmatter1.Realtogive2.Personaltodoornottodoc.Affirmativenessandnegativeness1.Positiveoraffirmativegiveortodo2.Negativenottodoornottogived.Personsobliged1.Unilateralonlyoneofthepartiesisbound;Ex.AowesB1M,AmustpayB.2.Bilateral-bothpartiesarebound;Ex.Contractofsalea.Reciprocal(sale)b.Non-reciprocalperformancebyoneisnotdependentuponperformanceoftheother(EditorsNote:Example?)

hn

ObligationsandContracts|CarlomanNotes2014|Atty.SanPedro1

1157:Obligationsarisefrom1.Law2.Contracts3.Quasi-contracts4.Actsoromissionspunishedbylaw;and5.Quasi-delicts1.Sourcesofobligations:a.Law(exlege)taxes/support;noagreementisnecessaryb.Contracts(excontractu)loanc.Quasi-contracts(exquasi-contractu)solutionindebiti/negotioromgestiod.Crimes(exmaleficioorexdelicto)dutytoreturnstolenthinge.Quasi-delicts(Tortsorexquasi-delictoorexquasi-maleficio)dutytorepairdamageduetonegligence2.Noteinactualityonlylawandcontractarethesourcessincec,d&earederivedfromlaw.3.Enumerationisexclusive.1158:Obligationsderivedfromlawarenotpresumed.OnlythoseexpresslydeterminedinthisCodeorinspeciallawsaredemandable,andshallberegulatedbythepreceptsofthelawwhichestablishesthem;andastowhathasnotbeenforeseen,bytheprovisionsofthisBook.1.Obligationsderivedfromlawarenotpresumedobligationsmustbeclearly(expresslyorimpliedly)setforthinthelaw(CivilCodeorSpecialLaw)2.ConflictbetweenCivilCodeandSpeciallaw,latterprevailsunlessthecontraryhasbeenexpresslystipulatedintheNewCivilcode.1159:Obligationsarisingfromcontractshavetheforceoflawbetweenthecontractingpartiesandshouldbecompliedwithingoodfaith.1.Doesnotmeanthatcontractsaresuperiortolaws,sinceforacontracttobevaliditmustnotbecontrarytolaw.2.Stipulationsinthecontractarelimitedbylaw;inthatthecontractingpartiesmayestablishsuchstipulations,clauses,termsandconditionsmastheymaydeemconvenient,provided,theyarenotcontrarytolaw,morals,goodcustoms,publicorder,orpublicpolicy.3.Neitherpartymayunilaterallyanduponhisownexclusivevolition,escapehisobligationsunderthecontract,unlesstheotherpartyassentedthereto,orunlessforcausessufficientinlawandpronouncedadequatebyacompetenttribunal.

4.Complianceingoodfaithinterpretnotbytheletterthatkillethbutbythespiritthatgivethlife.(GolangcoconstructionvPCIB)5.Innominatecontracts(see1307)a.DoutdesIgivethatyoumaygiveb.DoutfaciasIgivethatyoumaydoc.FacioutdesIdothatyoumaygived.FacioutfaciasIdothatyoumaydo1160.Obligationsderivedfromquasi-contractsshallbesubjecttotheprovisionsofChapter1,Title18,ofthisBook.1.Aquasi-contractjuridicalrelationresultingfromalawful,voluntaryandunilateralactandwhichhasforitspurposethepaymentofindemnitytotheendthatnooneshallbeunjustlyenrichedorbenefitedattheexpenseofanother.2.NotanimpliedcontractbecausethereisNOmeetingoftheminds.3.Types:a.Negotiorumgestio(unauthorizedmanagement)21441.CausedbyFE,circumstancescausedbyobligor2.Obligeenoobligationtoact3.Causedbenefittoobligorwhilecost/damagetoobligeeb.Solutioindebiti(unduepayment)2150Requisites:1.Payorhadnoobligationtopay2.Paymentwasmadebyreasonofanessentialmistakeoffact1161.Civilobligationsarisingfromcriminaloffensesshallbegovernedbythepenallaws,subjecttotheprovisionsofArticle2177,andthepertinentprovisionofChapter2,PreliminaryTitle,onHumanRelations,andofTitle18ofthisbook,regulatingdamages.1.Governingrulesoncriminaloffenses1.PertinentprovisionsoftheRPCandotherpenallaws,subjecttotheprovisionsofArt.2177,CivilCode.2.Chapter2,PreliminaryTitle,onHumanRelationsofCC3.Title18ofBook4oftheCCondamages2.Civilliabilityincludes1.Restitution2.Reparationofdamagecaused3.Indemnificationforconsequentialdamages3.Effectofacquittalofacriminalcase;rulesoncivilprocedure


1.Ifacquittedbecausetheaccusedcouldnothavecommittedtheactnocivilaction2.Ifacquittedduetoexemptingcircumstances-civilliability3.Independentcivilactionisallowedbylaw(libel,slander,estafaandphysicalinjuries)1162.Obligationsderivedfromquasi-delictsshallbegovernedbytheprovisionsofChapter2,Title17ofthisbookandbyspeciallaws.1.GoverninglawsofQuasidelictsa.Chapter2,Title17,Book4CCb.Speciallaws2.Alsoknownastortorculpaaquiliana3.Afaultoractofnegligencewhichcausesdamagestoanother,therebeingnopre-existingcontractualrelationsbetweentheparties.Canrefertoactswhicharecriminalincharacter,voluntaryorthroughnegligence.4.Negligenceistheomissionofthatdiligencewhichisrequiredbythecircumstancesofperson,placeandtime.Aquestionoffact.5.Requisitesforliability:a.Faultornegligenceb.Damageorinjuryc.Noexistingcontractualrelationsbetweenpartiesd.Proximatecauseadequateandefficientcause,whichinthenaturalorderofevents,necessarilyproducesthedamagesorinjurycomplainedof.

Chapter2:Natureandeffectofobligations1163:Everypersonobligedtogivesomethingisalsoobligedtotakecareofitwiththeproperdiligenceofagoodfatherofafamily,unlessthelaworthestipulationofthepartiesrequiresanotherstandardofcare.1.Dealswithdeterminatething(opposedtogeneric)oneofaclass.2.Extraordinarydiligenceifthatofacommoncarrier.1164:Thecreditorhasarighttothefruitsofthethingfromthetimetheobligationtodeliveritarises.However,heshallacquirenorealrightoverituntilthesamehasbeendeliveredtohim.1.Personalright(jusinpersonamorjusadrem)enforceableagainstotherparty;togivetodoornottodo2.Realright(jusinre)enforceableagainstthewholeworld;poweroveraspecificthing(ownershiporpossession)

3.Beforethelandisdeliveredproperremedyisspecificperformanceanddeliveryandnotaccionreinvindicatoria(presupposesownership)4.Deliverytransferownership.Itisnotbyagreementbuttraditionordeliverythattransfersownership.5.Kindsofdelivery:a.Actual(tradition)physicallythepropertychangeshandsb.Constructivedeliveryphysicaltransferisimpliedi.Traditionsimbolicakeystoacarisgivenii.Traditiolongamanupointingatobjectiii.Traditiobrevimanupossessorofathingnotanownerbecomestheownerthereof;tenantbuysthepropertyiv.Traditioconstitutompossessoriumpossessorofathingasanowner,retainspossessionnolongerasownerbutinsomeothercapacity;ownersoldthingandbecametenantofsamepropertyv.Traditionbytheexecutionoflegalformsandsolemnities6.Simulatedsaleorevenagenuineonewherethereisnodeliveryoftheobjectdoesnottransferownership.7.Obligationtodeliver:a.Ifthereisnotermorconditionperfectionofthecontractb.Ifthereisatermorconditionmomentthetermarrivesoraconditionhappens

1165:whenwhatistobedeliveredisadeterminatething,thecreditor,inadditiontotherightgrantedhimbyArticle1170,maycompelthedebtortomakethedelivery.Ifthethingisindeterminateorgeneric,hemayaskthattheobligationbecompliedwithattheexpenseofthedebtor.Iftheobligordelays,orhaspromisedtodeliverthesamethingtotwoormorepersonswhodonothavethesameinterest,heshallberesponsibleforfortuitouseventuntilhehaseffecteddelivery.1.Specificordeterminatethingonecapableofparticulardesignation.2.Genericorindeterminatethingrefersonlytoaclass,toagenus,andcannotbepointedoutwithparticularity.3.Remediesofcreditor:a.Specificperformanceb.Rescission(Resolutioncancellationofjuridicaltie,findoutwhenspecifictermsareused)c.Damages;withorwithoutin1or2.


4.Effectoffortuitouseventsa.Rule:Obligationisextinguishedb.Exceptions:i.Genericthing(genusnonquamperit)ii.Specificthingandthereisdelay(default/mora)orbadfaith.5.Ordinarydelaynonperformanceatthestipulatedtime(EN:ignorable)6.Legaldelay(default)amountstononfulfillmentoftheobligation;demandeitherjudicialorextrajudicialisnecessary.1166.Theobligationtogiveadeterminatethingincludesthatofdeliveringallitsaccessionsandaccessories,eventhoughtheymaynothavebeenmentioned.1.Accessoriesjoinedtoorincludedwiththeprincipalforthelattersbetteruse,perfectionorenjoyment(keyshouse)2.Accessionsadditionsorimprovementsuponathing.Includesalluvium(erosiondepositsonariverbank)3.Exceptionifotherwisestipulatedbytheparties.1167.Ifapersonobligedtodosomethingfailstodoit,thesameshallbeexecutedathiscost.Thissameruleshallbeobservedifhedoesitincontraventionofthetenoroftheobligation.Furthermore,itmaybedecreedthatwhathasbeenpoorlydonebeundone.1.Positivepersonalobligationtodo2.Remediesofcreditora.Havetheobligationperformedbyhimselforanotheratthedebtorsexpense;andb.Damagescannotbesubstitutedfornonperformanceunlesssubstitutionispermitted1168.Whentheobligationconsistsofnotdoing,andtheobligordoeswhathasbeenforbiddenhim,itshallalsobeundoneathisexpense.1.Negativepersonalobligation2.Remediesofobligora.Undoingofthethingattheobligorsexpense;andb.Damages

1169.Thoseobligedtodeliverortodosomethingincurindelayfromthetimetheobligeejudiciallyorextrajudiciallydemandsfromthemthefulfillmentoftheirobligation.However,thedemandbythecreditorshallnotbenecessaryinorderthatdelaymayexist:1.Whentheobligationorthelawexpresslysodeclares;2.Whenfromthenatureandthecircumstancesoftheobligationitappearsthatthedesignationofthetimewhenthethingistobedeliveredortheservicesistoberenderedwasacontrollingmotivefortheestablishmentofthecontract;or3.Whendemandwouldbeuseless,aswhentheobligorhasrendereditbeyondhispowertoperform.Inreciprocalobligations,neitherpartyincursindelayiftheotherdoesnotcomplyorisnotreadytocomplyinapropermannerwithwhatisincumbentuponhim.Fromthemomentoneofthepartiesfulfillshisobligation,delaybytheotherbegins.1.Demandnotneeded:a.Lawprovides(taxes;SSS;GSIS)b.Obligationprovides(fixingofperiodnotenough,theremustbeclearprovisionthatifpaymentisnotmadewhendue,defaultorliabilityfordamagesorinterestsautomaticallyarises.c.Whentimeisoftheessenceofthecontract;whenfixingthetimewasthecontrollingmotiveoftheestablishmentofthecontract(weddingdress);intentissufficientsolongasthisisimplied.d.Demandwouldbeuseless;whentheobligorhasrendereditbeyondhispowertoperform(destroyingobject)e.Whentheobligorexpresslyacknowledgedthathereallyisindefault;mereaskingofextensionisnotexpressacknowledgementofdefault.2.Kindsofmoraa.Morasolvendi(debtor)b.Moraaccipiendi(creditor)c.Compensatiomorae(bothareindefault;asifneitherisindefaultbyvirtueofparidelicto)3.MoraSolvendia.Noneinnegativeobligationsb.Noneinnaturalobligationsc.Requisites:i.Obligationmustbedueii.Thereisnon-performance


iii.Demand,unlessdemandisnotrequired;whendemandisneededcreditormustshowproof;merereminderisnotdemandsincecreditormaystilltoleratedelayd.Effects:i.Interestordamagesii.Beartheriskoflossiii.LiableevenunderFE.iv.Accelerationclausemaytriggerv.DebtoronlyliableforGrossnegligence(tantamounttoBF)andFraud/BF4.MoraAccipiendia.Unjustifiablerefusaltoacceptpaymentorperformanceb.Ifobligationisfromcriminaloffenceandcreditorismoraaccipiendii.Consigntocourtii.Keepittohimselfandexercisediligenceandcare;heisnotliableincaseoffortuitousevent.5.Forleases,creditorshoulderssubsequentaccidentallossofthepremiseleased6.Reciprocalobligationsa.Dependuponeachotherforperformance;contractofsalePAYandDELIVERb.Performancemaybesetondifferentdates.Butdeliverydoesnotautomaticallyputbuyerindefaultunlessthereisdemand,unlessdemandisnotrequired.c.Ifnotsetondifferentdates,assumedsimultaneousperformance.Andifneitherhasperformedthereiscompensatiomorae.7.Damagesandinterestmaybelostthroughprescription(alsoforprincipal)andcondonation.8.Interestrunsatthetimeofdemand.Ifdemandisuncertain,courtdecides.1170.Thosewhointheperformanceoftheirobligationareguiltyoffraud,negligence,ordelayandthosewhoinanymannercontravenethetenorthereof,areliablefordamages1.Groundsforliabilitya.Fraudb.Negligencec.Defaultd.Violationoftermsoftheobligation;unlessexcusedbyfortuitousevent

Dolo(Fraud)Culpa(Negligence)

DeliberateintenttocausedamagePresentAbsent

LiabilitycanbemitigatedNoYes

WaiverofactiontoenforceliabilityFuturefraudvoidFutureculpavalidincertaincases(notgross)

2.Followingdoesnotexcusefulfillmenta.Increaseincostofperformanceb.Badbargainc.Povertyd.War;aslongassubstantialcompliancecanstillbedone3.Kindsofdamagesa.Moralmentalorphysicalanguish;mustbeprovedb.Exemplarycorrectivetosetanexample;punishthecriminalintent;notpresumedc.Nominalvindicatearightwhennootherdamagecanberecovered;notforlosssufferedbutforrightviolated;courtdiscretiond.Temperatewhenexactamountofdamagescannotbedeterminede.Actualactuallossesorunrealizedprofitf.Liquidatedpredeterminedbyagreement4.Indemnityfordamagesa.Agreedupon;orb.Legalrateofinterest(6%)1171.Responsibilityarisingfromfraudisdemandableinallobligations.Anywaiverforfuturefraudisvoid.1.Liabilityforfraud(dolo)a.Accordingtotimeofcommission:i.Pastfraudmaybewaivedii.Futurefraud(orfuturegrossnegligence)cannotbewaived;defeatsjuridicaltieb.Accordingtomeaning:i.Fraudinobtainingconsent1.Dolocausante(causalfraud)vitiationofconsent,henceimportant;withoutthefraudtherewouldhavebeennocontract-voidableii.Fraudintheperformanceoftheobligation;forms:1.Doloincidente(incidentalfraud)evenwithknowledgeoffraud,therewouldstillhavebeenacontract-remedyisdamages-valid


1172.Responsibilityarisingfromnegligenceintheperformanceofeverykindofobligationisalsodemandable,butsuchliabilitymayberegulated

bythecourts,accordingtothecircumstances.1.Stipulationsonnegligencea.Grossnegligence:canneverbeexcusedinadvancecontrarytopublicpolicy;defeatsjuridicaltieb.Simplenegligence:incertaincasesbeexcusedormitigatedc.Billoflading,3usualstipulations:i.Exemptionofcarrierfromallliabilitiesforlossordamagebyitsownnegligencevoid;publicpolicy.ii.Limitstheliabilitytoanagreedvaluation,regardlessofdamagecausedvoid;publicpolicy,awealthycompanycanabusethis.iii.Limitsliabilitytoanagreedvalueunlesstheshipperdeclaresahighervalueandpaysahigherrateoffreightoradvalorembasisvalid2.Contractsofadhesiona.Partiesarenotinequalpositions(employmentortransportationcontracts)stipulationsonnegligencearestrictlyconstruedagainstthepartysituatedinahigherormoreadvantageousposition.3.KindsofCulpa,accordingtosource:a.Culpacontractual(contractualnegligence)resultingfromabreachofconrtract.b.Culpaaquiliana(civilnegligence/tort/quasi-delict)resultsfromoffensesduetonegligencec.Culpacriminal(criminalnegligence)resultsfromacommissionofacrimeoradelict

CULPACONTRACTUALCULPAAQUILIANACULPACRIMINAL

NatureofnegligenceIncidentalDirect,substantiveandindependentofacontractDirect,substantiveandindependentofacontract

Pre-existingobligationPresent(expressorimpliedcontract)AbsentAbsent

ProofneededPreponderanceofevidencePreponderanceofevidenceGuiltybeyondreasonabledoubt

DefenseOrdinarydiligenceinemployeeselectionisnotapropercompletedefense,onlymitigating.Respondeatsuperior(masterservantrule)isfollowed.Ordinarydiligenceisaproperandcompletedefenseforemployeesorguardians.Ordinarydiligenceisnotaproperdefenseinculpacriminal.Employeesguiltisautomaticallyemployerscivilguiltincaseofinsolvency.

ApplicablepresumptionsAslongasitwasprovedthattherewasacontractandthatitwasnotcarriedout,itispresumedthatthedebtorisatfault,anditishisdutytoprovethattherewasnonegligenceinthecarryingoutofthecontract.Victimprovesnegligence.Sinceactionisbasedonallegednegligenceonthepartofthedefendant.Accusedispresumedinnocentuntilthecontraryisproved,soprosecutionhastheburdenofprovingnegligenceoftheaccused.

4.CulpaContractual(Scenario:Contractofcarriage)a.Presenceofcontractofcarriagei.Evenifpassengerhasnotyetpaidii.Evenifpassengerhadnomoneytopayiii.Evenifincidentoccurredaspassengerwasboardingb.Passengercanbringsuchcasetoowneroftransportcompanyi.Contractisbetweenthepassengerandownerandnotthedriverunlesstheyareoneandthesame


ii.Ifownercanproveduediligenceinselectionandsupervisionofthedriver;ownerstillliableduetorespondeatsuperior.Butsuchdiligencemakesowneradebtoringoodfaithandsuchdamagewouldbemitigated.iii.Passengermustproveattheminimum:1.Presenceofacontractofcarriage2.Breachofthatcontract(non-arrivalatdestinationorwashurt)c.Driverispresumednegligentdrivermustproveotherwise(exerciseofextraordinarynegligence)i.Injuredpartyneedonlytoprove[4.b.iii.1and2],sincenegligenceispresumedd.Recklessnessi.Driver1.Unjustifiedrateofspeed;2.Flagrantviolationofroadcourtesies;3.Failuretosignalproperly;4.Deliberateentryonone-waystreets;5.Intoxication;6.Attempttopassanothervehiclethatfailstogivewayii.Owner1.Failuretorepairdefectiveparts2.Allowingworn-outcondition3.Failuretofurnishcompetentandtesteddriver4.Failuretodetectmanufacturingdefectse.Exemplarydamagestoowner(principal):i.Participationinthedoingofsuchwrongfulact;ii.Previouslyauthorizedorsubsequentlyratifiedtheactwithfullknowledgeofthefactsf.Respondeatsuperiori.Liabilityofownersisnotsubsidiarybutdirectandimmediate.1.Duediligencenotacompletedefenseonlymitigatesliability5.CulpaAquilianaa.Nopreviousexistingcontractualrelationsbetweenthepartiesb.Injuredparty(pedestrian)canbringactiontoowneranddriverc.Duediligenceofownerproperandcompletedefense;respondeatsuperiordoesnotapply

d.Negligenceisnotpresumed-Injuredpartyprovesnegligenceofdriverandownere.LiabilityunderCulpaAquilianaisentirelyseparateanddistinctfromtheliabilityarisingfromnegligenceundertheRPC(exdelicto),butplaintiffcannotrecovertwiceforthesameactoromissionofthedefendant(doublejeopardy).f.Mitigatedbyvictimsowncontributorynegligence;wheretheimmediateandproximatecauseoftheinjurybeingthedefendantslackofduecare.g.Doctrineoflastclearchancecannotapplyif:i.Negligenceoftheplaintiffisconcurrentwiththenegligenceofthedefendant;ii.Partychargedisrequiredtoactinstantaneously;iii.Injurycannotbeavoideddespitetheapplicationatalltimesofallthemeanstoavoidtheinjury;atleastinallinstanceswherethepreviousnegligenceofthepartychargedcannotbesaidtohavecontributedtotheinjuryatall.6.CulpaCriminala.Ongroundsofphysicalinjuriesthrurecklessimprudencei.Sameasculpaaquiliana;canberaisedbyinjuredparty(pedestrian)todriver1.Ifdriverisguiltyandinsolvent(proofthereofisnecessary),ownerissubsidiarilyliable;liabilityisautomaticnodefenseavailable;noreservationisnecessaryforthesubsidiaryliabilitytobehad;nodueprocessissuesincehealreadyhadhischanceduringthetrialofthedriverii.Sameasculpacontractual;canberaisedbypassengertodriveriii.Acquittalinthecriminalcaseisnotabartoacivilcasefordamages.Whatisprohibitedisthedoublerecoveryforthesamenegligentact.1173.Thefaultornegligenceoftheobligorconsistsintheomissionofthatnegligencewhichisrequiredbythenatureoftheobligationandcorrespondswiththecircumstancesoftheperson,ofthetimeandoftheplace.Whennegligenceshowsbadfaith,theprovisionsofArticles1171and2201,paragraph2,shallapply.Ifthelaworcontractdoesnotstatethediligencewhichistobeobservedintheperformance,thatwhichisexpectedofagoodfatherofafamilyshallberequired.


1.Kindsofdiligence:(hierarchyofenforcement)a.Agreeduponbythepartiesb.Requiredbylaw(particularprovision)-Ex.Extraordinarydiligenceforcommoncarriersc.Ordinarydiligence1174.Exceptincaseexpresslyspecifiedbylaw,orwhenitisotherwisedeclaredbystipulationorwhenthenatureoftheobligationrequirestheassumptionofrisk,nopersonshallberesponsibleforthoseeventswhichcouldnotbeforeseen,orwhichthoughforeseen,wereinevitable.1.GeneralRule:a.Noliabilityforafortuitousevent(casofortuito)thatwhichcannotbeforeseenorwhichifforeseen,wasinevitable2.ExceptionsthereisstillliabilityincaseofFE:a.Expresslydeclaredbylaw(badfaithamongparties,delay)b.Expresslydeclaredbystipulationorcontractc.Whenthenatureoftheobligationrequirestheassumptionofrisk;doctrineofcreatedriskEx.Carriertransportsdynamite,accidentalblow-outinjurespeople,heisliable.3.CharacteristicsofFE:a.Causeofthebreachoftheobligationmustbeindependentofthewillofthedebtor;b.Eventmustbeunforeseeableorunavoidable;c.Eventmustbesuchastorenderitimpossibleforthedebtortofulfillhisobligationinanormalmanner;d.Debtormustbefreefromanyparticipationin,oraggravationof,theinjurytothecreditor(notindefault,fraud,nobadfaithornegligence)4.Note:a.Fortuitouseventactofgodb.Forcemajeureactofmanc.FEwillnotaffectgenericthingsd.Lawisanactofsovereignpowerand,therefore,whateverlossincurredcanbeattributedtoaforcemajeure,5.Combinationofforcemajeureandnegligence:a.IfFEwastheproximatecause,theobligationisextinguishedb.Ifthenegligencewastheproximatecause,theobligationisnotextinguished.Convertedintoamonetaryobligationintheformofdamages.

1175.Usurioustransactionsshallbegovernedbyspeciallaws.1.Usurycontractingfororreceivingsomethinginexcessoftheamountallowedbylawfortheloanoruseofmoney,goods,chattelsorcredits.Extractionofexcessiveinterest.2.Kindsofinterest:a.Moratoryusualform,compensationorfeefortheuseofmoney.b.Compensatorybywayofdamages3.Notes:a.Legalrate6%forall.b.Usuryhasbeenabolished1/1/1983willnowdependonmutualagreement.c.2%permonthcurrentjurisprudenceunconscionable1176.Thereceiptoftheprincipalbythecreditor,withoutreservationwithrespecttotheinterest,shallgiverisetothepresumptionthatsaidinteresthasbeenpaid.Thereceiptofalaterinstallmentofadebtwithoutreservationastopriorinstallment,shalllikewiseraisethepresumptionthatsuchinstallmentshavebeenpaid.1.RuleArt.1253ofCC,paymentofinterestasaruleprecedespaymentoftheprincipal.Thisisonlyprimafacie.2.Note:a.Thispresumptiondoesnotapplytotaxestaxpayablecannotbeconsideredinstallmentpayments.b.1176toapply,itisnotenoughthatthereceiptfortheinstallmentpaidbedated,itmustalsospecifythatthereceiptisforthepaymentofaparticularinstallmentdue.1177.Thecreditors,afterhavingpursuedthepropertyinpossessionofthedebtortosatisfytheirclaims,mayexercisealltherightsandbringalltheactionofthelatterforthesamepurpose,savethosewhichhareinherentinhisperson;theymayalsoimpugntheactswhichthedebtormayhavedonetodefraudthem.1.Rightsofcreditorsa.Exactpaymentb.Exhaustdebtorspropertiesbyattachment,exceptthosepropertiesexemptedbylaw(support)c.Accionsubrogatoriaexerciseallrightsandactionsofdebtorinordertoexactpaymentofobligationexceptthoseinherentintheperson(parentalauthority,righttorevokedonationsduetoingratitude,holdoffice,carryoutagency).


d.Accionpaulianaimpugnorrescind(notresolution)contactsdonebythedebtortodefraudcreditorsi.Requirements:1.Plaintiffw/creditbeforerescisiblecontract2.Debtormadeaconveyance3.Nootherremedy4.Transactionofconveyanceisfraudulent5.3rdpartyisnotIPV(insertdifferenceofresolutionandrescissionhere)2.Rightsexemptfromexecution:a.Righttoexistencesupportb.Rightsofapubliccharacterpositionsinthegovernmentc.RightstoaffairsinthehomeandthefamilypersonalrightsofH&Wd.Rightsgrantedbylawtothedebtorrevokedonationduetoingratitudee.Righttoappearincourtproceedings,likesettlementofanestate3.Propertiesexemptfromexecution(notapplicableifthereisajudgmentofforeclosureormortgage):a.Familyhome(except;taxes,debtspriortofamilyhome,workersinconstructionoffamilyhome)b.Toolsandimplementsfortrade,employmentorlivelihoodc.3horses,3cows,3carabaosorotherbeastofburdenusedforoccupationd.Necessaryclothingandarticlesofpersonaluse;exceptjewelrye.Householdfurnitureandutensilsnecessaryforhousekeepingnotexceeding100k;f.Provisionsforindividualorfamilyusesufficientforfourmonths.g.Professionallibrariesh.Fishingboatandaccessoriesnotexceeding100k.i.Salariesandwages,4monthsubsidyrulej.Letteredgravestonek.Insurancepremiumsl.LegalsupportorgratuityfromGovtm.Exemptedbylaw

DefinitionComparedDefinition

UnilateralBilateral

RealPersonal

DeterminateGeneric

PositiveNegative

LegalConventional

Penal

DefinitionComparedDefinition

Nocondition;demandableatoncePureConditional

Purew/aperiod

Alternative(facultative)Conjunctive

JointSolidary

w/aPenalClausew/oPenalClause

1178.Subjecttothelaws,allrightsacquiredinvirtueofanobligationaretransmissible,iftherehasbeennostipulationtothecontrary.1.GRRightsaretransmissible(see1311)2.Exceptions(mustbeclearlyproved):a.Lawprovidesotherwiseb.Contractorstipulationprovidesotherwisec.Obligationispurelypersonal

Chapter3:DIFFERENTKINDSOFOBLIGAITONS1.Classificationofobligations

a.PrimaryClassificationObligationsandContracts|CarlomanNotes2014|Atty.SanPedro9

2.Civilaccordingtocivillaw3.Mixedaccordingtobothnaturalandcivillawii.Bypartiesorsubjects:1.Unilateral,bilateral2.Individual,collective3.Joint,solidaryiii.Byobjectoftheobligation1.Specific,generic2.Positive,negative3.Real,personal4.Possible,impossible5.Divisible,indivisible6.Principal,accessory7.Simple,compounda.Ifcompound:i.Conjunctivedemandableatthesametimeii.Distributivealternativeor

iv.Bydefects:

facultative

b.SecondaryClassification1.Nodefectvalid2.Defectivea.Rescissibleb.Voidablec.Unenforceabled.Void

c.AccordingtoSanchezRomani.Byjuridicalqualityandefficaciousness:1.Naturalaccordingtonaturallaw

SECTION1:PUREANDCONDITIONALOBLIGATIONS

1179.Everyobligationwhoseperformancedoesnotdependuponafutureuncertainevent,oruponapasteventunknowntotheparties,isdemandableatonce.Everyobligationwhichcontainsaresolutoryconditionshallalsobedemandable,withoutprejudicetotheeffectsofthehappeningoftheevent.1.Pureobligationa.Withoutaconditionortermb.Demandableatonce,providedtherewillbenoabsurdityc.Ex.Ipromisetopayyou1M.[ondemand]demandableatonce(EN:absurd,unlessyourerich).d.Mayalsooccurwhentheoriginalperiodorconditionhasbeencanceledbymutualstipulationofbothparties2.Conditionalobligationa.Whenthereisacondition(EN:badumtsss!)3.Condition:a.Anuncertaineventwhichwieldsaninfluenceonalegalrelationship(Manresa)b.Futureanduncertainevent4.Termorperiodthatwhichnecessarilymustcomewhetherthepartiesknownwhenitwillhappenornot(Ex.Death,sincesuretocomebutunsurewhenwilloccur)a.Futureandcertainevent5.Obligationsdemandableatonce:a.Whenitispure;orb.Whenithasaresolutorycondition6.Pasteventknowntopartiesa.Notaconditionb.Futureknowledgeofapasteventwilldeterminewhetherornotanobligationwillarise.7.Classificationofconditions:a.Suspensivecondition-Happeningoftheconditiongivesrisetotheobligation.b.ResolutoryconditionHappeningoftheconditionextinguishestheobligation.c.Potestativedependsonthewillofthedebtor.(ifIlike)d.Casualdependsonchanceorhazardorthewillofa3rdperson(lottery)


e.Mixeddependspartlyonthewillofoneofthepartiesandpartlyonchanceorthewillofa3rdperson(ifIpassthebar)(EN:sameascasual)f.Divisiblecapableofpartialperformanceg.Indivisiblenotcapableofpartialperformanceduetothenatureofthethingorintentionofthepartiesh.Positiveactistobeperformedi.Negativesomethingwillbeomittedj.Expressconditionisstatedk.Impliedconditionisinferredl.Possiblecapableoffulfillmentinnatureandinlawm.Impossiblenotcapableoffulfillmentduetonatureorduetotheoperationofthelaw,morals,orpublicpolicyorduetocontradictioninitstermsn.Conjunctiveifalltheconditionsmustbeperformedo.Alternativeifonlyafewoftheconditionshavetobeperformed1180.Whenthedebtorbindshimselftopaywhenhismeanspermithimtodoso,theobligationshallbedeemedtobeonewithaperiod,subjecttotheprovisionsofArticle1197.1.Whenhismeanspermit:a.Mayseemtobevoidduetoexclusivedependencyoffulfillmentonthewillofthedebtor(void1182,suspensiveandpotestative)b.Infactitisaperiodsincewhatdependsonthewillofthedebtorisnotthepaymentbutthetimewhenpaymentistobemade.c.Similarphases:i.whenmymeanspermitmetodosoii.whenIcanafforditiii.whenIamabletoiv.whenIhavemoney2.1197a.Todeterminelengthofterm,1197willbeappliedCourtisobligedtofixthedurationoftheperiod.b.Creditortoaskthecourtfirsttofixtheterm,afterwhichhecanmakedemanduponarrivalofthetermc.Notapplicableifsettingofthetermwouldservenopurposebutdelay

1181.Inconditionalobligations,theacquisitionofrights,aswellastheextinguishmentorlossofthosealreadyacquired,shalldependuponthehappeningoftheeventwhichconstitutesthecondition.1.Suspensivecondition(conditionsprecedent):a.Happeningofwhichwillgiverisetotheacquisitionofarightb.Ifitdoesnottakeplace,itsasiftheconditionalobligationneverexisted.2.Resolutorycondition(conditionssubsequent):a.Rightsalreadyacquiredarelostoncetheconditionisfulfilled.b.Thosesuspensivebutcannotbeperformedwithoutacquiringtherightsfirstaredeemedresolutory(buildahouse1stbeforedonationcannotbuildahouseifyourenotowner,hencedonationmustcomefirst)1182.Whenthefulfillmentoftheconditiondependsuponthesolewillofthedebtor,theconditionalobligationshallbevoid.Ifitdependsuponchanceoruponthewillofathirdperson,theobligationshalltakeeffectinconformitywiththeprovisionsofthisCode.1.Potestative,CasualandMixedconditions:a.Potestativedependsontheexclusivewillofoneoftheparties.i.Onthepartofthedebtor1.IfSuspensiveVoid,illusoryobligation(..ifIlive.However,ifthereisapreemptiverightthismakestheobligationvalid,sincethiswillbecomemixed.2.IfResolutoryValid(employment)ii.Onthepartofthecreditor1.Validb.CasualdependsonChanceoruponthewillofthe3rdpersonc.Mixedonthepartofthedebtor(evenifSuspensive)+3rdpartyoreventValid(giveyouifIcansellmylanddependson3rdparty,thebuyer)


1183.Impossibleconditions,thosecontrarytogoodcustomsorpublicpolicyandthoseprohibitedbylawshallannultheobligationwhichdependsuponthem.Iftheobligationisdivisible,thepartthereofwhichisnotaffectedbytheimpossibleorunlawfulconditionshallbevalid.Theconditionnottodoanimpossiblethingshallbeconsideredasnothavingbeenagreedupon.1.Impossibleandillegalconditionsa.ImpossibleEx.Tomakeadeadmanlive,makeacirclewith4sidesb.Illegal-unlawfulkilling2.Effects:a.Positivetermsvoidb.Negativetermsvalid,disregardthecondition(cannotmakeacirclewith4sides)c.Nocauseofactionarisingfrombreachfornonperformance1184.Theconditionthatsomeeventhappenatadeterminatetimeshallextinguishtheobligationassoonasthetimeexpiresorifithasbecomeindubitablethattheeventwillnottakeplace.1.PositiveconditionsSuspensiveconditionsthatwillnolongerhappenforcertain(todoortogive)a.Ex.IfyoumarryXwithintheyearandayearhaspassed.1185.Theconditionthatsomeeventwillnothappenatadeterminatetimeshallrendertheobligationeffectivefromthemomentthetimeindicatedhaselapsed,orifithasbecomeevidentthattheeventcannotoccur.Ifnotimehasbeenfixed,theconditionshallbedeemedfulfilledatsuchtimeasmayhaveprobablybeencontemplated,bearinginmindthenatureoftheobligation.1.NegativeconditionsResolutoryconditions(nottodo)1186.Theconditionshallbedeemedfulfilledwhentheobligorvoluntarilypreventsitsfulfillment.1.Constructivelypresumedfulfillmenta.Onemustnotprofitbyhisownfaultb.Generallyappliestosuspensiveconditionsi.ResolutoryapplicationinstancegiveAtoBifBmarriesC,AkillsC.deemedfulfilled.

2.Requisites:a.Eithermaliciouslyornot,intenttopreventmustbepresentifintentwasnottopreventnoconstructivefulfillment;andb.Actuallypreventsfulfillment1187.Theeffectsofaconditionalobligationtogive,oncetheconditionhasbeenfulfilled,shallretroacttothedayoftheconstitutionoftheobligation.Nevertheless,whentheobligationimposesreciprocalprestationsupontheparties,thefruitsandinterestsduringthependencyoftheconditionshallbedeemedtohavebeenmutuallycompensated.Iftheobligationisunilateral,thedebtorshallappropriatethefruitsandinterestreceived,unlessfromthenatureandcircumstancesoftheobligationitshouldbeinferredthattheintentionofthepersonconstitutingthesamewasdifferent.Inobligationstodoandnottodo,thecourtsshalldetermine,ineachcase,theretroactiveeffectoftheconditionthathasbeencompliedwith.1.EffectsoffulfillmentofSuspensiveconditiona.GRretroactstothedaytheobligationisconstitutedb.Exception:i.Fruitsorinterest(mutualcompensation)ii.Periodofprescription-periodrunswhenconditionisfulfilled,becausecanonlybeenforcedonlyfromsaiddate.iii.Realcontracts(depositorcommodatum)1188.Thecreditormay,beforethefulfillmentofthecondition,bringtheappropriateactionsforthepreservationofhisright.ThedebtormayrecoverwhatduringthesametimehehaspaidbymistakeincaseofaSuspensivecondition.1.Actionstopreservecreditorsrightsa.Ifcreditorisnotallowedtotakeappropriateaction,thereisadangerthecreditorwillreceivenothing,aswhentheobjectisdeliberatelydestroyed,orhiddenoralienatedb.Bringappropriateaction:i.Sueincourtii.Recordingoftheexpectedright(ROD)iii.Askforasecurity(incaseofimminentinsolvency)iv.Courtactiontopreventalienationorconcealment2.Paidbymistake(solutioindebitiunduepayment)a.Mayberecoveredbecause,theconditionmaynotmaterialize,hence,noobligation.Therewouldbedeprivationofdebtorsrighttousetheobject.


b.Thedebtorisentitledtofruitsorlegalinterestifthecreditorbeinbadfaithcreditorknewthatthepaymentwasbeingmadepriortofulfillmentofthecondition.3.Paymentnotbymistake:a.Ifconditionisfulfillednorecoverybecauseofretroactivity(legalfiction)(butmaygetnominaldamagesifCRinBF)b.Ifconditionisnotfulfilledrecoveryshouldbedoneunlesspuredonationwasintended4.Notes:a.Preservationnotpreference.b.Whatistobeprotectedisarightinexpectancy(inchoate)whichthelawprotects1189.Whentheconditionshavebeenimposedwiththeintentionofsuspendingtheefficacyofanobligationtogive,thefollowingrulesshallbeobservedincaseoftheimprovement,lossordeteriorationofthethingduringthependencyofthecondition:1.Ifthethingislostwithoutthefaultofthedebtor,theobligationshallbeextinguished;2.Ifthethingislostthroughthefaultofthedebtor,heshallbeobligedtopaydamages;itisunderstoodthatthethingislostwhenitperishes,orgoesoutofcommerce,ordisappearsinsuchawaythatitsexistenceisunknownoritcannotberecovered;3.Whenthethingdeteriorateswithoutthefaultofthedebtor,theimpairmentistobebornebythecreditor;4.Ifitdeterioratesthroughthefaultofthedebtor,thecreditormaychoosebetweentherescissionoftheobligationanditsfulfillment,withindemnityfordamagesineithercase;5.Ifthethingisimprovedbyitsnature,orbytime,theimprovementshallinuretothebenefitofthecreditor;6.Ifitisimprovedattheexpenseofthedebtor,heshallhavenorightthanthatgrantedtotheusufructuary.1.Applicationofarticle:a.Suspensiveconditionisfulfilled;andb.Objectisspecific(notgeneric)2.Changesintheobject(beforedeliveryandfulfillmentofS.condition)a.Losti.w/ofaultofdebtorcreditorbearslossii.w/faultofdebtordebtorliablefordamagesb.Deteriorate(valueisreducedorimpaired)i.w/ofaultofdebtorcreditorbearsdeteriorationii.w/faultofdebtor

c.Improved

1.rescission;2.specificperformance+damages;or3.purelydamages


c.Fruitsortheinterestthereonshouldalsobereturnedafterdeductingofcoursetheexpensesmadefortheirproduction,gathering,andpreservation.d.1189willapplyincasestowhoeverhasthedutytoreturnin

i.Notcausedbydebtor(nature/time)enjoyedbycreditorii.causedbydebtordebtorhasrightsofausufructontheimprovements(see#3)3.Usufructuaryrightofdebtoronimprovementsa.Rightsofausufruct(Art.579CC):i.Norighttoalterii.Norighttoindemnification/reimbursementiii.Mayremoveimprovementsprovideditwontcausedamagetopropertyiv.Rightofoffsetagainstdamagesmadeontheproperty(Art.580CC)4.Lossdefined:a.Perishes(houseburnsdown)b.Goesoutofcommerce(unprohibitedbecomesprohibited)c.Disappearsinsuchawaythatitsexistencebecomesunknown(carmissingforsometime)d.Disappearsinsuchawaythatitcannotberecovered(ringdroppedinmiddleoftheocean)5.Partialloss:a.Lossimportantenoughtobeconsideredcompleteloss(courtdeterminesthis)b.Merelybeconsideredadeteriorationofthething,inwhichcasetherulesondeteriorationapplies.1190.Whentheconditionshavefortheirpurposetheextinguishmentofanobligationtogive,theparties,uponthefulfillmentofsaidconditions,shallreturntoeachotherwhattheyhavereceived.Incaseoftheloss,deteriorationorimprovementofthething,theprovisionswhich,withrespecttothedebtor,arelaiddownintheprecedingarticleshallbeappliedtothepartywhoisboundtoreturn.Asforobligationstodoandnottodo,theprovisionsofthesecondparagraphofArticle1187shallbeobservedasregardstheeffectoftheextinguishmentoftheobligation.1.Fulfillmentofaresolutorycondition:a.Obligationisextinguishedb.Inobligationstogive;partiesshouldrestoretoeachotherwhattheyreceived.

caseofloss,deteriorationorimprovementofthethinge.Courtsaregivenpowertodeterminetheretroactivityofthefulfillmentofresolutoryconditions1191.Thepowertorescindobligationsisimpliedinreciprocalones,incaseoneoftheobligorsshouldnotcomplywithwhatisincumbentuponhim.Theinjuredpartymaychoosebetweenthefulfillmentandrescissionoftheobligation,withthepaymentofdamagesineithercase.Hemayalsoseekrescission,evenafterhehasineithercase.Hemayalsoseekrescission,evenafterhehaschosenfulfillment,ifthelattershouldbecomeimpossible.Thecourtshalldecreetherescission,evenafterhehaschosenfulfillment,ifthelattershouldbecomeimpossible.Thecourtshalldecreetherescissionclaimed,unlesstherebejustcauseauthorizingthefixingofaperiod.Thisisunderstoodtobewithoutprejudicetotherightsofthirdpersonswhohaveacquiredthething,inaccordancewithArticles1385and1388andtheMortgageLaw.1.Reciprocalobligationsa.Requiresthattheobligationsshouldarisesimultaneously(dependencyofobligations)b.Obligationorpromiseofeachpartyisthecauseorconsiderationfortheobligationorpromisetotheother.c.Thepartywhohasnotperformedhisendofthereciprocalobligationcannotresolvethesameevenifthereisslightbreachsolongasthemainobligationwascompliedwithbytheotherparty.(AsturiasSugarCentralvPureCane)d.Non-performanceoftheothergivescauseofactionforresolution2.Righttorescind/resolvea.Tocancelorresolveb.Notpredicatedoninjurytoeconomicinterestsonthepartofplaintiff(contrarytorescissionin1380and1381)butonthebreachoffaithbythedefendant,whichbreachisviolativeofthereciprocitybetweentheparties.

c.Actabrogatescontractfromitsinceptionandrequiresamutualrestitutionofbenefitsreceived(renderingitvoidabinitio,notmeretermination).d.Createstheobligationtoreturntheobjectofthecontracte.Presumedbutexistsonlyinreciprocalobligations(onlyifpure)f.Canonlybedemandediftheplaintiffisready,willingandabletocomplywithhisownobligationandtheotherisnot.Ifneitherisready,neithercanresolve.g.Guiltypartycannotrescind(paridelicto)h.Mayonlybehadforbreachesthataresosubstantialandfundamentalastodefeattheobjectofthepartiesinmakingtheagreement,hence,notapplicabletoslightorcasualbreach.i.Notabsolute:i.Trivialcause/slightbreachwillnotcauserescissionii.Causemustbeexistentatthetimeoffilingofthecomplaintiii.Iftherebeajustcauseforfixingtheperiodwithinwhichthedebtorcancomply,thecourtwillnotdecreerescission(Par.31191).Butthecourtcannotfixtheperiodinunlawfuldetainercaseswherenoleasepaymentsweremade,sincenotgrantedunderArt.1659.iv.CannotrescindifpropertyisnowinthehandsofIPV(remedyisdamagestopersonsinbadfaith).j.Whenjudicialapprovalisrequired:i.Neededwhentherehasalreadybeendeliveryoftheobject(unlessreturnedvoluntarily)ii.Notneeded:1.Whentherehasbeennodelivery(automaticrescission)2.Whentherehasbeendelivery:a.butthereexistsastipulationthateitherpartycanrescindthesameortakepossessionofthepropertyuponnonfulfillmentbytheotherpartywithoutgoingtocourt.b.WaiverReason:Becauseiftherehasbeendeliveryyoucanttakethelawintoyourownhandsandjustgetthethingbackwithoutafavorablejudgmentnorcanyousellitorexerciseanyotheractsofownership.


k.Impliedtoexist,therefore,neednotbeexpresslystipulatedupon.l.Maybewaived,expresslyorimpliedly.(acceptinginstallmentpaymentsbeyondgraceperiod)m.Effects:i.restorespartiestotheiroriginalsituationunlessstipulated3.Actionsbyinjuredpartya.Either:i.Specificperformance+damages(ifdamagesisnotasked,deemedwaived);ii.Rescission+damages;oriii.Partspecificperformanceandpartrescission(incaseofpartialdelivery)+damagesb.Rightisalternative(providedfinaljudgmentisnotgivenyet)andnotconjunctive,however,partialofbothmaybeallowed(TanGuatvPamintuanO.G.2494)c.Natureofobligationchangesperlevel(midtermpossibilityRamirezvCA98Phil225)gist:obligationisnottoreturnthinglostthroughFEsincecreditorcanoptfor2ndoption,henceFEisimmaterialsinceitbecomesmonetaryobligation(damages)4.IMBAcase;theONLYExceptionto1191:SuriavIAC5.Notes:a.Terminationthepartyisrelyingonthetermination/penal/forfeitureclause

1192.Incasebothpartieshavecommittedabreachoftheobligation,theliabilityofthefirstinfractorshallbeequitablytemperedbythecourts.Ifitcannotbedeterminedwhichofthepartiesfirstviolatedthecontract,thesameshallbedeemedextinguished,andeachshallbearhisowndamages.

ConditionPeriod/term

UncertaineventCertaintohappensoonerorlater;atadateknownbeforehand,oratimewhichcannotbedetermined

MayrefertoeitherfutureorpastRefersonlytothefuture

CausesanobligationtoariseorceaseMerelyfixesthetimeortheefficaciousnessofanobligation

SECTION2:OBLIGATIONSWITHAPERIOD

1193.Obligationsforwhosefulfillmentadaycertainhasbeenfixed,shallbedemandableonlywhenthatdaycomes.Obligationwitharesolutoryperiodtakeeffectatonce,butterminateuponarrivalofthedaycertain.Adaycertainisunderstoodtobethatwhichmustnecessarilycome,althoughitmaynotbeknownwhen.Iftheuncertaintyconsistsinwhetherthedaywillcomeornot,theobligationisconditionalanditshallberegulatedbytherulesoftheprecedingSection.1.Period/terma.Certainlengthoftimewhichdeterminestheeffectivityortheextinguishmentofobligations.b.Requisites:i.Refertothefutureii.Certain(suretocome)butcanbeextended.iii.Physicallyorlegallypossible

2.Periodvs.Condition3.Typesoftermsorperiodsa.Definiteexactdateortimeisknownb.Indefinitesomethingthatwillsurelyhappenbutthedateofhappeningisunknown(death)c.Legalviaprovisionsofthelawd.Conventionalorvoluntaryagreeduponorstipulatedbythepartiese.Judicialperiodortermfixedbythecourtsf.ExdieperiodwithSuspensiveeffectg.Indiemperiodortermwitharesolutoryeffect


4.Daycertaina.Thatwhichmustnecessarilycome,althoughitmaynotbeknownwhen.(term)5.Notes:a.Differentiateanobligationwithasuspensiveconditionandanobligationwithasuspensiveterm.b.Ifnoaccelerationclause,onlythoseinstallmentsthatareduearedemandablec.Theremustbeanagreementondurationofleasetoallowcauseofactionattheendoftheagreedterm(unlawfuldetainer).d.Ifperiod/termiseliminatedsubsequentlybymutualagreement,theobligationbecomespureandimmediatelydemandable.e.IfobligationdemandableonoraboutDec.X,200XdemandableafewdaysbeforeorafterDec.X,200Xandnotadatefarawaynoronefixedbythedebtor.f.Obligationsarenotextinguishedifthepartiesreallyintendedatermandnotaconditionwheretheconditionbecomesimpossibletohappen.Ex.AwillgiveBacarthemomentXbecomes30yrsold.Xdiesat28,Astillliable.g.Periodofprescriptioncommencesfromthetimethetermoftheobligationarrives,foritisonlyfromthatdatethatitisdueanddemandable.h.Evidenceofextensionofperiodshownbythepartybenefiting(debtor).i.Moratoriumlaw(periodofgraceviapostponementofobligation)unconstitutional,excepttoobligationscontractedbeforethewar(RiovDatuJolkipli)

1194.Incaseofloss,deteriorationorimprovementofthethingbeforethearrivalofthedaycertain,therulesinArticle1189shallbeobserved.

1195.Anythingpaidordeliveredbeforethearrivaloftheperiod,theobligorbeingunawareoftheperiodorbelievingthattheobligationhasbecomedueanddemandable,mayberecovered,withthefruitsandinterests.1.PrematurepaymentinGFa.Prematurepaymentingoodfaith([a]unawareofperiod[b]believedthatobligationhasbecomedueanddemandable)entitlesoneforrecoveryandlegalinterestthereon.Except:i.Paidwithfullknowledgeoftheexistenceoftheterm.(butinterestisstillgranted)ii.Partiesimplicitlyagreedtochangetheperiod.iii.Non-unilateralobligations(reciprocal)byvirtueofmutualcompensationb.Recoveryi.Ifnoknowledge:1.Beforedebtmatures2.Afterdebtmatures,mayclaiminterestifcreditorisinBFii.Subjectto5yearprescriptioniii.Ifw/knowledgecannotrecover,regardlessofBF,sincethisoperatesasanimpliedwaiver.c.Debtorsknowledgeofprematurenessispresumed1196.Wheneverinanobligationaperiodisdesignated,itispresumedtohavebeenestablishedforthebenefitofboththecreditorandthedebtor,unlessfromthetenorofthesameorothercircumstancesitshouldappearthattheperiodhasbeenestablishedinfavorofoneoroftheother.1.Main:a.GR:Termconstitutedisforthebenefitofthedebtororcreditorb.Effect:Debtorcannotpayprematurelyandthecreditorcannotdemandprematurelyc.Exceptions:Withcontemporaneousintent;


i.Interestisstipulated1.Creditorinterestearned2.Debtormoretimetopayii.Creditorisinterestedinkeepinghismoneysafelyinvested(debtorasdepository)orwhenthecreditorwanttoprotecthimselffromthedangersofcurrencydepreciationb.Forthebenefitofthedebtor:i.Withoutinterest1.Except:whenclearlyshownthatcreditorhadintentiontoprotecthimselffromtherisksassociatedwiththepossessionoftheobjectii.Whenpaymentistobemadewithinacertainperiodfromdateofcontractc.Forthebenefitofthecreditor:i.Whenstipulated.nopaymentmadeuntilafteracertainperiod.Acceptanceofpartialpaymentevenbeforetheexpirationoftheperiodmeansawaiveronthepartofthecreditorofhisrighttorefusepaymentbeforetheendofsaidperiod.ii.Defeatsthereasonsofbenefit;wherebenefitcanstillbeobtainedevenwithdebtorsacts.(ex.Principal+interestforthewholeperiod)1197.Iftheobligationdoesnotfixaperiod,butformitsnatureandthecircumstancesitcanbeinferredthataperiodwasintended,thecourtsmayfixthedurationthereof.Thecourtsshallalsofixthedurationoftheperiodwhenitdependsuponthewillofthedebtor.Ineverycasethecourtsshalldeterminesuchperiodasmayunderthecircumstanceshavebeenprobablycontemplatedbytheparties.Oncefixedbythecourts,theperiodcannotbechangedbythem.

2.Indications:

i.Termisforthebenefitofthedebtoralone.Heisrequiredtopayonlyattheendbuthemaypayevenbeforeandhemayresistprematuredemandforcompliance.within.ii.Termforthebenefitofthecreditoralone.Hecandemandatanytimeevenbeforethetermexpires,andhecannotbecompelledtoacceptpaymentfromthedebtorpriortothestipulatedperiod.giventherighttodemandperformanceevenbeforesaiddate

1.Whencourtmayfixtheperioda.Whendurationdependsuponthewillofthedebtori.meanspermitmetodosoii....littlebylittleiii.assoonaspossibleiv..assoonasIhavemoneyv.inpartialpaymentsvi.whenthedebtorisinapositiontodischargehisobligation

a.Forthebenefitofboth:

b.Whentheobligationdoesnotfixaperiod,itcanbeinferredthataperiodwasintended.i.Partieshadknowledgeofcircumstanceswhichwouldhinderperformanceoftheobligationc.Courtmayalsoaddaforfeitureclauseincaseofnonperformanceaftertheexpiryoftheperiod(AlanovCortes)2.Whenthecourtmaynotfixtheterma.Whennotermwasspecifiedbythepartiesbecausenotermwasevenintended(pureobligation)(Exception:absurdity)b.payableondemandc.Whenthedebtor/obligoradmittedimpossibilityofperformanced.Specificperiodsareprovidedforinthelawe.Rightofactionhasprescribed3.Effectoffixingtheperioda.Doesnotaltertheobligation,sinceitmerelycarriesoutwhatwasimpliedlystipulatedbytheparties.b.Fulfillmentoftheobligationitselfcannotbedemandeduntilafterthecourthasfixedtheperiodforitscompliance.c.Fixinganddemandforfulfillmentcannotbeaskedatthesametime.Exceptwhenfixingtheperiodwouldbeamereformalityandservenootherpurposebutdelay,thereisnonecessityofsuchprioraction.d.Nodelayuntilperiodisfixed,demandmustbemadesubsequently.4.Howcourtfixestheperiod:a.Determiningthetimeprobablycontemplatedbytheparties.b.Courtscannotchangeonceperiodisfixed.c.Sameeffectwhenthecourtapprovesacompromiseagreement.courtscannotchangeterms5.Notes:a.Partiesmaychangetheperiodbymutualagreementordisregardthesame.b.Articledoesnotapplytoacontractofleasewhere:i.Partieshasreservedtothemselvesthefacultyofagreeingupontheperiodoftherenewalcontract(MillarevHernando);ORii.Renewaloftheperiodisnotlefttothewillofthelesseealone,butrathertothewillofthelessororlessee.


1198.Thedebtorshallloseeveryrighttomakeuseoftheperiod:1.Whenaftertheobligationhasbeencontracted,hebecomesinsolvent,unlesshegivesaguarantyorsecurityforthedebt;2.Whenhedoesnotfurnishtothecreditortheguarantiesorsecuritywhichhehaspromised;3.Whenbyhisownactshehasimpairedsaidguarantiesorsecuritiesaftertheirestablishment,andwhenthroughafortuitouseventtheydisappear,unlessheimmediatelygivesnewonesequallysatisfactory;4.Whenthedebtorviolatesanyundertaking,inconsiderationofwhichthecreditoragreedtotheperiod;5.Whenthedebtorattemptstoabscond.

1.Effectoflosingperiod:a.Debtorloseseveryrighttomakeuseoftheperiod;termisextinguishedandtheobligationisdemandableatonce.2.Term/periodhowcomputed:a.UnderArt13ofCC.i.Years365daysii.Months30daysiii.Days24hrsiv.Nightssunsettosunrisev.Monthsdesignatedbynamerespectivedaysvi.Period1stdayexcluded,lastdayincluded,ifthelastdayfallsuponaSaturday,aSundayoralegalholidayintheplacewherethecourtsits,thetimeshallnotrununtilthenextworkingday(notappliedforpenalperiods)vii.Xdays:Aftersight,afterhappeningofevent,afterdatetimeofpaymentisdeterminedbyexcludingthedayfromwhichtimeistobegintorun,andincludethedayofpayment.viii.TreatybeginsnotonRPviewpoint,butatthetimeallcountriesratify,sinceonlyatthistimeitwillhaveeffect3.Notes:a.LossthroughFEin3isregardlessoffaultonthepartofthedebtor.Hestilllosesbenefitofperiod.Exceptionalsoprovidedin3.b.Employmentcontractmaybeterminatedeveniftherewasfixeddurationforthejob(underpar.4)

c.Inabsconding;mereintenttodosobeingsufficient.Ontheotherhand,amerephysicalleavingwithoutintenttodefraud,isnotsufficient.d.Aleatorycontracts;allowed:whenpartiesagreeonpaymentofP5k,onecannotpayitsequivalent,mustbetheP5k.Ratio:speculationofcurrency

SECITON3:ALTERNATIVEOBLIGATIONS

1199.Apersonalternativelyboundbydifferentprestationsshallcompletelyperformoneofthem.Thecreditorcannotbecompelledtoreceivepartofoneandpartoftheotherundertaking.1.Alternative(facultative)obligationa.Twoormoreprestationswhichmaybegiven,onlyoneisdue

1200.Therightofchoicebelongstothedebtor,unlessithasbeenexpresslygrantedtothecreditor.Thedebtorshallhavenorighttochoosethoseprestationswhichareimpossible,unlawfulorwhichcouldnothavebeentheobjectoftheobligation.1.Limitationsofdebtorschoice:a.Impossible;b.Unlawful;orc.Thatwhichcouldnothavebeentheobjectoftheobligation.2.Notes:a.Facultativereinsurancecontractsnotthesamewithfacultativeobligationssincethesedenoteacceptanceornon-acceptanceoftheobligationandnotthemerechoosingbetweenprestations.

1201.Thechoiceshallproducenoeffectexceptfromthetimeithasbeencommunicated.1.Noticea.Formlawrequiresnone,hencemaybe:i.Writtenii.Oraliii.Express


iv.Impliedb.Effect:i.obligationbecomesasimpleobligationtodoordeliverobjectselectedii.oncemadecannotberenouncedunlesspermittedbytheotherparty1.ifchoiceislostbyFE,creditorbearsriskoflossc.Purposeinordertoinformthedebtorthattheobligationisnowasimpleone,nolongeralternative,andifalreadydue,forthecreditortoreceivetheobjectbeingdelivered,iftenderofthesamehasbeenmade.i.IflostbyFE:1.Nocommunicationliable2.w/communication-extinguishedd.Requisites:i.Madeproperlysothatthecreditororhisagentwillactuallyknow;ii.Madewithfullknowledgethataselectionisindeedbeingmade.Note:errorinappreciatingmeaningofthealternativeobligationswillgiverisetovitiatedconsent,andchoicecanlateronbeannulled.iii.Madevoluntaryandfreelywithoutforce,intimidation,coercionorundueinfluenceiv.Madeinduetimebeforeoruponmaturity,otherwisethecreditorcansuehimincourtwithanalternativereliefasgivethisorthat,dependinguponyourchoicev.Madetoalltheproperpersonshence,iftherearejointcreditorsallmustbenotifiedvi.Madewithoutconditionsunlessagreedtobythecreditorotherwise,itcanbesaidthatnorealchoicehasbeenmadevii.Maybewaived,expresslyorimpliedly

AlternativeFacultative

VariousthingsareduebutgivingofoneissufficientOnlyonethingisprincipallydue,anditisthatonewhichgenerallyisgiven,buttheother(thesubstitute)maybegiventorenderpaymentorfulfillment

Ifoneoftheprestationsisillegal,theothersmaybevalidandtheobligationremainsIftheprincipalobligationisvoid,andthereisnonecessityofgivingthesubstitute.Thenullityoftheprincipalcarrieswithitthenullityofthe

b.Ex.AgiveringtoC,Acangivecarasasubstitute.

1202.Thedebtorshalllosetherightofchoicewhenamongtheprestationswherebyheisalternativelybound,onlyoneispracticable.1.Notes:a.Debtormayfaultlydestroyanyobject;providedthatavalidobjectstillremains,ifthesameislostthroughFE,obligationisextinguished.1203.Ifthroughthecreditorsactsthedebtorcannotmakeachoiceaccordingtothetermsoftheobligation,thelattermayrescindthecontractwithdamages.1.Notes:a.Noautomaticrescission,sincedebtormaychoosetoallowtheobligationtobeinforceinsofarasthepossiblechoicesareinvolved.1204.Thecreditorshallhavearighttoindemnityfordamageswhen,throughthefaultofthedebtor,allthethingswhicharealternativelytheobjectoftheobligationhavebeenlost,orthecomplianceoftheobligationhasbecomepossible.Theindemnityshallbefixedtakingasabasisthevalueofthelastthingwhichhasdisappeared,orthatoftheservicewhichlastbecomeimpossible.Damagesotherthanthevalueofthelastthingorservicemayalsobeawarded.1.Applicationofarticle:a.Whenrighttochoosebelongedtothedebtor;andb.Thelossorimpossibilityhappenedbeforeselectionwasmade.2.Notes:a.Valueoflastthinglostw/fault+damages=giventocreditor1205.Whenthechoicehasbeenexpresslygiventothecreditor,theobligationshallceasetobealternativefromthedaywhentheselectionhasbeencommunicatedtothedebtor.Untilthentheresponsibilityofthedebtorshallbegovernedbythefollowingrules:1.Ifoneofthethingsislostthroughafortuitouseven,heshallperformtheobligationbydeliveringthatwhichthecreditorshouldchoosefromamongtheremainder,orthatwhichremainsifonlyonesubsists;2.Ifthelossofthethingsoccursthroughthefaultofthedebtor,thecreditormayclaimanyofthosesubsisting,orthepriceofthat


which,throughthefaultoftheformerhasdisappeared,witharighttodamages;3.Ifallthethingsarelostthroughthefaultofthedebtor,thechoicebythecreditorshallfalluponthepriceofanyoneofthem,alsoindemnityfordamages.Thesamerulesshallbeappliedtoobligationstodoornottodoincaseone,someoralloftheprestationsshouldbecomeimpossible.1.Creditorrighttochoosea.Expresslygiven,cannotbeimpliedb.Communicationmaybeexpressorimplied2.Lostobjects,creditorsrights:a.Chooseremainingobject,nodamages;orb.Priceoflastobjectlostw/faultofdebtor+damages,sincedeprivedoftherighttochoose3.Creditordelaysinmakingachoicea.Debtornotindefaultnotwithstandingmaturitysincedebtordoesnotknowwhattodeliverb.Debtorcanpetitionthecourttocompelcreditortoaccept,inthealternative,atthecreditorsoption,withresultantdamagesifany.1206.Whenonlyoneprestationhasbeenagreedupon,buttheobligormayrenderanotherinsubstitution,theobligationiscalledfacultative.Thelossordeteriorationofthethingintendedasasubstitute,throughthenegligenceoftheobligor,doesnotrenderhimliable.Butoncethesubstitutionhasbeenmade,theobligorisliableforthelossofthesubstituteonaccountofhisdelay,negligenceorfraud.1.Facultativeobligationa.Onlyoneprestationhasbeenagreeduponbuttheobligormayrenderanotherinsubstitution.

accessoryorsubstitute

Ifitisimpossibletogiveallexceptone,thelastonemuststillbegivenIfitisimpossibletogivetheprincipal,thesubstitutedoesnothavetobegiven,ifitisimpossibletogivethesubstitute,theprincipalmuststillbegiven

Righttochoosemaybegiveneithertothedebtor(presumed)orcreditor(expressed)Righttochooseisonlytodebtor

2.Notes:a.Ifsubstituteislostw/fault,noliabilitysincedebtorcanstillchoosetheprincipal.Andnorightswereimpaired.

SECTION4:JOINTANDSOLIDARYOBLIGATION

1207.Theoccurrenceoftwoormorecreditorsoroftwoormoredebtorsinoneandthesameobligationdoesnotimplyeachoneoftheformerhasarighttodemand,orthateachoneofthelatterisboundtorender,entirecompliancewiththeprestations.Thereisasolidaryliabilityonlywhentheobligationexpresslysostates,orwhenthelaworthenatureoftheobligationrequiressolidarity.1.JointvsSolidarya.Jointeachobligoranswersonlyforapartofthewholeliabilityandeachobligeebelongsonlyapartofthecorrelativerights.Toeachhisown.(1)Mancommunada(2)Mancomunadasimple(3)Proportionate(4)Prorata(5)Wepromisetopaythereare2ormoresignaturesb.Solidaryrelationshipbetweentheactiveandpassivesubjectsissoclosethateachoftheformerorthelattermaydemandthefulfillmentoformustcomplywiththewholeobligation.Oneforall,allforone.Righttoreimbursefromotherdebtorsarise.(1)Juntososeparademente(2)Mancomunadainsolidum(3)Individually


(4)Jointlyandseverally(5)Insolidum(6)Mancomunadasolidaria(7)Eachwillpaythewholevalue(8)Individuallyandcollectively(9)Ipromisetopaythereare2ormoresignatures2.Rules:a.GR:jointb.Exceptions:(1)Stipulationorcontract(2)Natureofobligationrequiressolidarity(3)Lawdeclaresobligationsolidarya.Tort(Culpaaquilianaorquasi-delict)b.Quasi-contractsc.Deviseesandlegateesd.Liabilityofprincipals,accomplicesandaccessoriesofafelonye.Baileesincommodatum3.Notes:a.Obligationscanbejointorsolidaryoneithercreditorordebtor.Rule:respectjointness.b.Rulesnotapplicablewhereonlyonepartyforeachside(EN:badumtss)1208.Iffromthelaw,orthenatureorthewordingoftheobligationstowhichtheprecedingarticlerefersthecontrarydoesnotappear,thecreditordebtshallbepresumedtobedividedintoasmanyequalsharesastherearecreditorsordebtors,thecreditsordebtsbeingconsidereddistinctfromoneanother,subjecttotheRulesofCourtgoverningthemultiplicityofsuits.1.PresumedJointa.Debtdividedintoasmanysharesastherearecreditorsordebtors;b.Creditsanddebtsshallbedistinctfromoneanother;c.Butregardingthebringingoftheactionincourt,theRoCgoverningthemultiplicityofsuitswillbefollowed.i.Ordinarilyonecreditormaysueoneofthedebtorsforthelattersshareobligation.ii.AimoftheRoCistoobtainajust,speedyandinexpensivedeterminationofeveryactionorproceeding,itwouldbemuchbettertosueallthenecessarypartiesatthesametime.

d.Whenjudgmentbythecourtastorelation,itmustbefollowedregardlessofoppositetocontract.Notwithstanding,therightofappealoftheparties.2.Characteristicsofjointliabilitya.Vitiatedconsentonthepartofonedebtordoesnotaffecttheothersb.Insolvencyofonedoesnotmakeothersresponsibleforhissharec.Demandbythecreditorononejointdebtorputshimindefault,butnottheotherssincethedebtsaredistinct.d.Whenthecreditorinterruptstherunningoftheprescriptiveperiodbydemandingjudiciallyfromone,theothersarenotaffected.Possiblethatshareofonehasprescribedwhilethatoftheothershasalreadyprescribed.e.Defensesofonedebtorarenotnecessarilyavailabletotheothers.3.Notes:a.Deathinthelineofdutyofemployee-Sb.Co-principals-Sc.H&WafterexhaustionofconjugalpartnershipJd.PenalorcontrarytomoralsSe.EmployerstortemployerSubsidiary,employeePrimaryf.SorJ,dependsonpartyintentionsg.AorBwillpay-solidary1209.Ifthedivisionisimpossible,therightofthecreditorsmaybeprejudicedonlybytheircollectiveacts,andthedebtcanbeenforcedonlybyproceedingagainstallthedebtors.Ifoneofthelattershouldbeinsolvent,theothersshallnotbeliableforhisshare.1.Jointandindivisibleobligationsa.Indivisibleastoobjectb.Jointastojuridicaltie(oppositewithsolidaryindivisiblenoproblemhere)c.Fulfillmentrequirestheconsentofallthedebtors,althougheachforhispart.Onthesideofthecreditors,collectiveactionisalsorequiredforactswhichmaybeprejudicial.2.Characteristics:a.Creditormustproceedagainstalljointdebtors,sincecompliancecanonlybehadifallthejointdebtorswouldacttogether.b.Ifanyoneofthedebtorsdoesnotcomply,convertedtomonetaryobligation,damagestopartyatfault.


c.Anyofthejointdebtorsbeinsolvent,theothersshallnotbeliableforhissharei.Transformedtomonetary(damages)d.Ifjointcreditors,deliverymustbemadetoall,andnotmerelytoone,unlessthatonebespecificallyauthorizedbytheothers.e.Eachjointcreditorisallowedtorenouncehisproportionatecredit.Othercreditorsdonotreceivebenefitofrenunciation.Benefitgoestodebtors.f.Demandtoonedebtordoesnotaffectothers.1210.Theindivisibilityofanobligationdoesnotnecessarilygiverisetosolidarity.Nordoessolidarityofitselfimplyindivisibility.1.Indivisibilityvs.solidaritya.Indivisibilitysubjectmatterb.Solidarityjuridicaltie2.Typesofsolidarity:a.Activeonpartofcreditorsorobligesb.Passive-onpartofdebtorsorobligorsc.Mixedonbothpartsd.Conventionalagreeduponbypartiese.Legalbylaw1211.Solidaritymayexistalthoughthecreditorsandthedebtorsmaynotbeboundinthesamemannerandbythesameperiodsandconditions.1.Solidaritydespitedifferenttermsorconditionsa.Uniformsamestipulationsandclausesb.Otherwiseliableforsameprestations,neverthelessnotsubjecttosamesecondarystipulationandclausesi.Solidarityispreservedsincecreditorhaspower,butstilllimitedbytheconditions.ii.Recoveryisequaltototaldebtminusshareofunmaturedconditionsorterms.1212.Eachoneofthesolidarycreditorsmaydowhatevermaybeusefultotheothers,butnotanythingwhichmaybeprejudicialtothelatter.1.Beneficialact:a.Interruptrunningofprescriptionbyfilingbeforethecourts2.Prejudicialact:a.Nonperformanceb.Condonationofonesolidarycreditor

1213.Asolidarycreditorcannotassignhisrightswithouttheconsentoftheothers.1.Solidaryobligationimpliesmutualagencyorconfidence.2.JBLReyescitingManresadissentssuchassignmentneednotbeconsentedto(EN:[email protected])1214.Thedebtormaypayanyoneofthesolidarycreditors;butifanydemand,judicialorextrajudicial,hasbeenmadebyoneofthem,paymentshouldbemadetohim.1.Towhomdebtormustpaya.Anysolidarycreditors;b.Exception:tocreditorwhomadedemand(judicialorextrajudicial)2.Notes:a.Paymenttocreditorwhodidnotmakedemandwillnotextinguishobligation,exceptinsofarasthepayeesshareisconcerned.(wrongSanPedro,butignorehimforBAR)b.Creditormakingdemandhascauseofaction,othercreditorscannotdoanythingsincetheyarerepresentedbythecreditorwhomadethedemand.c.Specificcreditorshoulddemandfirstbeforesuing,regardlessifothercreditorshasalreadymadedemand.Notethatthisislegallycorrect,butwouldresultinanabsurdity,hence,theyshouldbeallowedtosuetoprotecttheirinterestsaswell.d.Nondemandeddebtorpaystodemandingcreditorextinguishestheobligationandnullifiesdemandmadebyothercreditortootherdebtors.1215.Novation,compensation,confusionorremissionofthedebt,madebyanyofthesolidarycreditorsorwithanyofthesolidarydebtors,shallextinguishtheobligation,withoutprejudicetotheprovisionofArticle1219.Thecreditorwhomayhaveexecutedanyoftheseacts,aswellashewhocollectsthedebt,shallbeliabletotheothersfortheshareintheobligationcorrespondingtothem.1.Novationmodifiestheobligation,changingitsobjectorprincipalconditions,orbysubstitutingthepersonofthedebtor,orbysubrogatingthepersonofthedebtororbysubrogatinga3rdpersonintherightsofthecreditor.a.Otherdebtorswillgivethecomplyingdebtorequaltothebenefitreceived.b.Othercreditorscanobtainreimbursement.


c.Extensionisnovation,Art.1211applies.2.Compensationtwopersons,intheirownrightarecreditorsanddebtorsofeachother.Maybetotal(automaticextinguishment)orpartial,dependingupontheamountinvolved.3.Confusionormergercharacteristicsofcreditoranddebtoraremergedinthesameperson.4.Remissionorwaiveractofliberalitywherebyacreditorcondonestheobligationofthedebtor.Maybetotalorpartial.Noreimbursementamongdebtors(iftotalremission)foritisagratuitousact,butthereisreimbursementamongcreditors.Ifpartial,asifnoremissioninviewpointofotherdebtors.5.Paymentbeforeremission(full)remissionisuselessbecausetherewasnothingmoretoremit.Sotherewillstillbereimbursementamongdebtors.1216.Thecreditormayproceedagainstanyoneofthesolidarydebtorsorsomeorallofthemsimultaneously.Thedemandmadeagainstoneofthemshallnotbeanobstacletothosewhichmaybesubsequentlybedirectedagainsttheothers,solongasthedebthasnotbeenfullycollected.1.Solidaritydoesnotmakethesolidarydebtorsanindispensablepartytoasuitfiledbythecreditor.2.Suingofnotall,doesnotoperateasawaivertothoseunsued3.Applicableonlytosolidaryobligations4.Applicableevenifforarevivalofajudgment5.Passivesolidarityvs.suretyshipinserthere1217.Paymentmadebyoneofthesolidarydebtorsextinguishestheobligation.Iftwoormoresolidarydebtorsoffertopay,thecreditormaychoosewhichoffertoaccept.Hewhomadethepaymentmayclaimfromhisco-debtorsonlythesharewhichcorrespondstoeach,withtheinterestsforthepaymentalreadymade.Ifthepaymentismadebeforethedebtisdue,nointerestfortheinterveningperiodmaybedemanded.Whenoneofthesolidarydebtorscannot,becauseofinsolvency,reimbursehissharetothedebtorpayingtheobligation,suchshareshallbebornebyallhisco-debtors,inproportiontothedebtofeach.1.Reimbursement+interestfromtimeofpayment2.Neednotesgoback!UseJurado3.Canstilldemandpaymentfromdebtorwhodidnotoffertopay(EN:maybefoolishthough).

4.NatureofReimbursementjoint,notordinarilyjointsinceinsolvencyofoneinthemeantimebeshoulderedbytherest.5.Substitutionincourtactionforreimbursement1218.Paymentbyasolidarydebtorshallnotentitlehimtoreimbursementfromhisco-debtorsifsuchpaymentismadeaftertheobligationhasprescribedorbecomeillegal.1219.Theremissionmadebythecreditorofthesharewhichaffectsoneofthesolidarydebtorsdoesnotreleasethelatterfromhisresponsibilitytowardstheco-debtors,incasethedebthadbeentotallypaidbyanyoneofthembeforetheremissionwasaffected.1.Thereisstillliabilityeveniforiginallypartiallyremittedifotherdebtorisinsolvent,thisisinconnectionwiththenatureofthereimbursementliability.Notwithstanding,futurerecoverabilityfromtheinsolventdebtor.1220.Theremissionofthewholeobligation,obtainedbyoneofthesolidarydebtors,doesnotentitlehimtoreimbursementfromhisco-debtors.1.Becauseofgratuitousinnature,appliesonlyupontotalremission2.Inpartialremission,however,thereisrecovery,asifjointincomputation.1221.Ifthethinghasbeenlostoriftheprestationhasbecomeimpossiblewithoutthefaultofthesolidarydebtors,theobligationshallbecomeextinguished.Iftherewasfaultonthepartofanyoneofthem,allshallberesponsibletothecreditorforthepriceandthepaymentofdamagesandinterest,withoutprejudicetotheiractionagainsttheguiltyornegligentdebtor.Ifthoughafortuitousevent,thethingislostortheperformancehasbecomeimpossibleafteroneofthesolidarydebtorshasincurredindelaythroughthejudicialorextrajudicialdemanduponhimbythecreditor,theprovisionsoftheprecedingparagraphshallapply.1.Lossorimpossibilityofperformancea.w/faultliabilityw/damagesalltothecreditor,rightofactionagainstnegligentorguiltydebtorb.w/ofaultnoliabilityc.FEafterdefaultsameas(a)


1222.Asolidarydebtormay,inactionsfiledbythecreditor,availhimselfofalldefenseswhicharederivedfromthenatureoftheobligationandofthosewhicharepersonaltohim,orpertaintohisownshare.Withrespecttothosewhichpersonallybelongtotheothers,hemayavailhimselfthereofonlyasregardsthatpartofthedebtforwhichthelatterareresponsible.1.Appliestoactionsfiledbythecreditor2.Defenses:a.Derivedfromthenatureoftheobligation(completedefense):i.Lackofconsiderationorcauseii.Absolutesimulation(fictitiouscontract)iii.Illegalconsiderationiv.Extinguishmentoftheobligation(payment,remission,orhasprescribed)v.Nonfulfillmentofsuspensiveconditionvi.Statuteoffraudsvii.Alldebtorsincapacitatedtogiveconsent(unemancipatedminors,insane,idiots,personsunderhypnoticspell)viii.Therearevicesofconsentb.Personaltothedebtorsued.(generallyacompletedefense,partialdefenseifnon-fulfillmentofconditionornon-arrivaloftermorperiodheisliableexceptforhisownshareinthemeantime)i.Vitiatedconsentii.Incapacityiii.Nonfulfillmentofcondition(partial)iv.Nonarrivalofterm(partial)c.Personaltotheothers(partial)i.Yougetthebenefitofthedefenseofothers,henceyourliabilitymaybereducedbythecompletedefenseofotherdebtorsshare3.Notes:a.Minority,therecanstillbereimbursementuptotheextentofbenefit.b.Oanocase

SolidarityIndivisibility

ReferstotiebetweenpartiesReferstonatureofobligation

NeedsatleasttwodebtorsorcreditorsMayexistevenifthereisonlyonedebtorandonlyonecreditor

ThefaultofoneisthefaultoftheothersFaultofoneisnotthefaultofothers

SECTION5:DIVISIBLEANDINDIVISIBLEOBLIGAITONS

1223.ThedivisibilityorindivisibilityofthethingsthataretheobjectofobligationsinwhichthereisonlyonedebtorandonlyonecreditordoesnotalterormodifytheprovisionsofChapter2ofthisTitle.1.Divisiblevsindivisiblea.Divisibleonecapableofpartialperformanceb.Indivisiblenotcapableofpartialperformance

2.SolidarityvsIndivisibility3.Classes/kindsofindivisibilitya.Conventionalagreementb.Natural/absolutebynatureofobjectc.Legalprovidedbylaw4.Kindsofdivisiona.Quantitativedivisionsametypedividedinquantityb.Qualitativedivisiondifferenttypesdivided(quality)c.Intellectualormoralco-ownership;onlyinthemindandnotreal1224.Ajointindivisibleobligationgivesrisetoindemnityfordamagesfromthetimeanyoneofthedebtorsdoesnotcomplywithhisundertaking.Thedebtorswhomayhavebeenreadytofulfilltheirpromisesshallnotcontributetotheindemnitybeyondthecorrespondingportionofthepriceofthethingorofthevalueoftheserviceinwhichtheobligationconsists.1.Effectofnon-compliance1.Convertedintoamonetaryobligation2.JointdebtorinBFobligation+damage3.JointdebtorinGFshareinmonetaryobligationonly.


1225.Forthepurposeoftheprecedingarticles,obligationstogivedefinitethingsandthosewhicharenotsusceptibleofpartialperformanceshallbedeemedtobeindivisible.Whentheobligationhasforitsobjecttheexecutionofacertainnumberofdaysofwork,theaccomplishmentofworkbymetricunits,oranalogousthingswhichbytheirnaturearesusceptibleofpartialperformance,itshallbedivisible.However,eventhoughtheobjectorservicemaybephysicallydivisible,anobligationisindivisibleifsoprovidedbylaworintendedbytheparties.Inobligationsnottodo,divisibilityorindivisibilityshallbedeterminedbythecharacteroftheprestationineachparticularcase.1.Deemedindivisiblea.Togivedefinitethings-specificcarb.Thosenotsusceptibleifpartialperformanceorchestraconcertc.Providedbylawd.Intentionofparties2.Deemeddivisiblea.Executionofcertainnumberofdaysofwork10dayworkb.Objectistheaccomplishmentofworkbymetricalunitsc.Purposeofobligationistopayininstallmentsd.Natureofobligationissusceptibleofpartialperformancecharacterofprestationonnegativeobligations3.Effectofillegalityofadivisiblecontracta.Ifseparable,thevalidportionisupheld.4.Notes:a.Acontracttodoseveralthingsatseveraltimesisdivisible,andajudgmentforasinglebreachofacontinuingcontractisnotabartoasuitforthesubsequentbreach.(Blossom&Co.vManilaGasCorp.)b.Aclaimfordamagesforabreachisanindivisibledemand,whenaformerfinaljudgmentisrendered,itisabartoanydamageswhichtheplaintiffmaythereaftersustain.

SECTION6:OBLIGATIONSWITHAPENALCLAUSE

1226.Inobligationswithapenalclause,thepenaltyshallsubstitutetheindemnityfordamagesandthepaymentofinterestsincaseofnon-compliance,ifthereisnostipulationtothecontrary.Nevertheless,damagesshallbepaidiftheobligorrefusestopaythepenaltyorisguiltyoffraudinthefulfillmentoftheobligation.ThepenaltymaybeenforcedonlywhenitisdemandableinaccordancewiththeprovisionsofthisCode.1.Penalclausea.Coercivemeanstoobtainfromthedebtorcompliancefromthedebtor.b.Anaccessoryundertakingtoassumegreaterliabilityincaseofbreach.c.Attachedtoobligationsinordertoensureperformanceandsubstitutefordamagesandthepaymentofinterestincaseofnon-compliance.d.Kinds:i.Legalbylawii.Conventional-agreementiii.Subsidiaryonlypenaltymaybeaskediv.Jointprincipalcontractandpenalclausecanbeenforced2.Comparedtoconditiona.Conditionisnotanaccessory,hencemaybecomedemandableindefaultoftheunperformedprincipalobligation,andsometimesjointlywithit,whiletheformerortheconditionisneverdemandable.3.GR:Penaltytakestheplaceofindemnityfordamagesandthepaymentofinterest.Exceptions:a.Expressstipulation(interest+damagesmaystillberecovereddespitethepresenceofthepenaltyclause)b.Debtorrefusestopaythepenaltyc.Debtorisguiltyoffraudordolointhefulfillmentoftheobligation[ratio:norenunciationoffuturefraud]fraudisessential4.Notes:a.Compoundingofinterestisprimafaciepenalclauseb.Courtmyreduceifiniquitousorunconscionablec.GR85161readthis


1227.Thedebtorcannotexempthimselffromtheperformanceoftheobligationbypayingthepenalty,saveinthecasewherethisrighthasbeenexpresslyreservedforhim.Neithercanthecreditordemandthefulfillmentoftheobligationandthesatisfactionofthepenaltyatthesametime,unlessthisrighthasbeenclearlygrantedhim.However,ifafterthecreditorhasdecidedtorequirethefulfillmentoftheobligation,theperformancethereofshouldbecomeimpossiblewithouthisfault,thepenaltymaybeenforced.1.GR:DebtorcannotsubstitutepenaltyfortheprincipalobligationException:Ifsuchrighthasbeenexpresslyreserved(notimplied)2.GR:CreditorcannotdemandbothfulfillmentandthepenaltyatthesametimeException:Ifsuchrighthasbeenexpresslygranted3.Notes:a.Evenifalesseeisreadytoforfeittheimprovementsontheestate,hemaystillbeoustedfromthepremisesforhishavingviolatedtheconditionimposeduponhim,namely,noimprovementswithoutthepermissionofthelessor.1228.Proofofactualdamagessufferedbythecreditorisnotnecessaryinorderthatthepenaltymaybedemanded.1.Nonecessityofprovingactualdamagesa.Ratio:Penalclauseisinstitutedinordertopunishinfractionsintheobligationnotasameresecurity,itisalawfulmeansforrepairinglossesanddamages,anduponevidenceoftheviolationoftheconditionsstipulated,theinjuredpartyisnotobligedtoprovelossesanddamagessuffered,northeextentofthesameinordertodemandtheenforcementofthepenalclauseagreedupon.1229.Thejudgeshallequitablyreducethepenaltywhentheprincipalobligationhasbeenpartlyorirregularlycompliedwithbythedebtor.Eveniftherehasbeennoperformance,thepenaltymayalsobereducedbythecourtsifitisiniquitousorunconscionable.1.Whencourtmayreducepenaltya.Partialperformanceb.Irregularperformance(EN:connectwithobligationarisingfromthingsdonepoorly)c.Iniquitousorunconscionable2.Whenpenalclausecannotbeenforceda.Breachisthefaultofthecreditor

b.FE,unlessexceptionsinArt.1174areapplicablec.Debtornotyetindefault3.Notes:a.Courtsmaystillreduceiftherehasbeensubsequentbenefittothecreditor/obligee,evenifsuchbenefitwasobtainedwithouttheaidofthedebtor/obligor(InsularGovernmentv.Amachezurra)b.Thisarticledoesnotapplytofinalandexecutoryjudgment(CommercialCreditCorp.ofCagayanvCA)1230.Thenullityofthepenalclausedoesnotcarrywithitthatoftheprincipalobligation.Thenullityoftheprincipalobligationcarrieswithitthatofthepenalclause.

CHAPTER4:EXTINGUISHMENTOFOBLIGAITONGENERALPROVISIONS

1231.Obligationsareextinguished:(1)Bypaymentorperformance;(2)Bythelossofthethingdue;(3)Bythecondonationorremissionofthedebt;(4)Bytheconfusionormergeroftherightsofcreditoranddebtor;(5)Bycompensation;(6)BynovationOthercausesofextinguishmentofobligations,suchasannulment,rescission,fulfillmentofaresolutorycondition,andprescription,aregovernedelsewhereinthisCode.1.CausesofextinguishmentbyCASTAN:a.Voluntaryi.Performance:1.Paymentorperformance2.Consignationii.Substitutionofperformance:1.Compensation2.Novation3.Dacionenpago(datioinsolutum)iii.Agreementtorelease1.Subsequenttoobligation:a.Unilateralwaiverb.Naturalwaiver


c.Remissiond.Mutualdissent(disenso)e.Compromise2.Simultaneouswithcreationofobligationa.Resolutoryterm/extinctiveperiodb.Resolutorycondition/conditionssubsequentb.Involuntarycauses:i.FailuretobringactionEx.Prescriptionii.ResolutoryconditionorconditionsubsequentEx:1.Mergerorconfusion2.Deathforpersonaloblgiations3.Changeincivilstatusobligationsduetofamilyrelationsiii.Reasonoftheobject:1.Impossibility2.Lossofthingdue

SECTION1:PAYMENTORPERFORMANCE

1232.Paymentmeansnotonlythedeliveryofmoneybutalsotheperformance,inanyothermanner,ofanobligation.1.Paymentconsistsof:a.Deliveryofmoneyb.Performanceinanyothermanner2.Acceptancebythecreditor,expresslyorimplicitlyisanessentialelement.3.Notes:a.Paymentmadeunderavoidjudgmentisalsonullandvoid(ManilaSuretyandFidelityCo.vLim)1233.Adebtshallnotbeunderstoodtohavebeenpaidunlessthethingorserviceinwhichtheobligationconsistshasbeencompletelydeliveredorrendered,asthecasemaybe.1.Requisitesofavalidpayment:a.Verythingorservicecontemplatedmustbepaidb.Fulfillmentmustbecomplete

2.Howpaymentorperformanceismadea.Ifthedebtismonetaryobligation,bydeliveryofthemoneyinfullunlessthecontraryhasbeenstipulated.b.Ifthedebtisthedeliveryofathing,bydeliveryofthethingorthingsc.Ifthedebtisthedoingofapersonalundertaking,bytheperformanceofsaidpersonalundertakingd.Ifthedebtisnotdoingsomething,byrefrainingfromdoingtheaction3.Burdenofproofa.Creditorhasburdentoproveexistenceofdebtb.Debtorhasburdenofprovingthathehaspaidthedebtc.Art.1176shouldbeusedtodetermineprimarypresumptions1234.Iftheobligationhasbeensubstantiallyperformedingoodfaith,theobligormayrecoverasthoughtherehasbeenstrictandcompletefulfillment,lessdamagessufferedbytheobligee1.Notes:a.Articleaffordsjustcompensationrelativetothebreachcommittedbytheobligor.b.Norighttorescind,sincethearticleassumesthatsubstantialperformanceingoodfaithisalreadyequivalenttofulfillmentorpayment.c.Articlefocusesonslightbreaches.1235.Whentheobligeeacceptstheperformance,knowingitsincompletenessorirregularity,andwithoutexpressinganyprotestorobjection,theobligationisdeemedfullycompliedwith.1.Ratio:EstoppelorWaiver2.Qualifiedacceptancea.Acceptancewheretherearequalificationsb.Reservationforfutureprotestorobjectionc.Suretyorguarantorofdebtormustgiveconsentd.Thisistopreventthesuretyorguarantorfromlateronallegingthatthecreditorhadgivenanextensionoftimetothedebtor.3.Acceptdefined:a.Totakeasatisfactoryorsufficient,oragreetoanincompleteorirregularperformanceb.Merereceiptisnotequivalenttoacceptanceofperformanceandwouldnotextinguishthewholeobligation


1236.Thecreditorisnotboundtoacceptpaymentorperformancebyathirdpersonwhohasnointerestinthefulfillmentoftheobligation,unlessthereisastipulationtothecontrary.Whoeverpaysforanothermaydemandfromthedebtorwhathehaspaid,exceptthatifhepaidwithouttheknowledgeoragainstthewillofthedebtor,hecanrecoveronlyinsofarasthepaymenthasbeenbeneficialtothedebtor.1.Creditorcanrefusepaymentbyastranger,EXCEPT:a.Stipulationb.3rdpersonhasaninterestinthefulfillmentoftheobligationi.Co-debtorii.Guarantoriii.Jointdebtor2.Ratiowhycreditormustnotbecompelledtoreceivepaymentfromstrangera.Personalchoiceshouldberespected3.Paymentbya3rdpersona.Withknowledgeandconsentofdebtorpayorisentitledtoreimbursement;subrogationb.Withoutknowledgeoragainsthiswillpayerisnotentitledtosubrogation;onlyallowedbeneficialreimbursementfromdebtor,noreimbursementfromcreditorforbenefit,onlysolutioindebitipartcanberecovered+damagesiftherewasBFc.Instanceswhererecoveryfromcreditormaybeavailed:i.Prescribedii.Completelyremittediii.Paidiv.Compensationhasbeenaffected1237.Whoeverpaysonbehalfofthedebtorwithouttheknowledgeoragainstthewillofthelatter,cannotcompelthecreditortosubrogatehiminhisrights,suchasthosearisingfrommortgage,guaranty,orpenalty.1.Subrogationa.Actofenablingtheformertoexercisealltherightsandactionsthatcouldhavebeenexercisedbythelatter.b.Thisisactuallythereasonwhyastrangerwouldvolunteertopayinbehalfofthedebtor.c.Rightsexercisedarethosearisingfrom:i.Mortgage;ii.Guaranty;oriii.Executionofpenalty(viapenalclause)

2.Subrogationvs.Reimbursementa.Subrogationtheremayberecourse,inreimbursementthereisnone;b.Insubrogationoriginaldebtisextinguished,butgivesrisetonewcreditorwiththesamerights.Inreimbursementthenewcreditorhasdifferentrights.c.Reimbursementislimitedtoapersonalactionofrecovery,insubrogationthereismorethansuchpersonalactionofrecovery.d.Inboththereisrecoveryofwhatthestrangerhaspaid,notnecessarilytheamountofthecredit.3.Notes:a.Ifwithknowledgebutwithoutanyexpressorimplieddissentorwhennoactionwastakenbythedebtorafterknowingsuchinformation;DEEMEDCONSENT,(EN:supportedbyArt.1302)1238.Paymentmadebyathirdpersonwhodoesnotintendtobereimbursedbythedebtorisdeemedtobeadonation,whichrequiresthedebtorsconsent.Butthepaymentisinanycasevalidastothecreditorwhohasacceptedit.1.Paymentdeemedconsenta.Donativeintentb.Nooneshouldbecompelledtoacceptthegenerosityofanother(ReportoftheCodeofCommission)2.Notes:a.Donationmaystillberecoveredifitwasinvalid(notinwriting)ornorealdonation.Butvalidastothecreditorwhoacceptedit.1239.Inobligationstogive,paymentmadebyonewhodoesnothavethefreedisposalofthethingdueandcapacitytoalienateitshallnotbevalid,withoutprejudicetotheprovisionsofArticle1427undertheTitleonNaturalObligations.1.Paymentbyanincapacitatedpersona.GR:i.Invalidifacceptedii.Creditorcannotbecompelledtoacceptiii.Remedyofconsignationwouldnotbeproperb.Exception:i.1427:whenaminorbetween18and21(EN:oldlaw),whoenteredintoacontractwithouttheconsentoftheparentsorguardianvoluntarilypaysasumofmoneyordeliversafungiblethinginfulfillmentofthe


obligation,thereshallbenorrighttorecoverthesamefromtheobligeewhohasspentorconsumeditingoodfaith.1240.Paymentshallbemadetothepersoninwhosefavortheobligationhasbeenconstituted,orhissuccessorininterest,oranypersonauthorizedtoreceiveit.1.Towhompaymentmustbemade:a.Personinwhosefavortheobligationhasbeenconstituted(creditoratthetimeofpayment,notatthetimeconstituted)b.Successor-in-interest(heirs)c.Authorizedtoreceiveit(agreementorlaw)i.Receivedwithoutauthority(GR:void)2.Notes:a.Valesinthehandsofthecreditorconstitutepresumptionofnonpayment,inthehandsofthedebtor,presumptionofpayment.b.Paymentmadetoentitiesauthorizedbyanoccupationgovernmentofdebtsinfavorofenemypersonsandcorporationsisvalid.(HawPiavCHB)c.Paymenttoawrongpartyingoodfaith,debtisnotextinguished.Hence,interestwillstillcontinuetorun.d.Consignmentinsteadofpaymentwillnotextinguishobligation,unlesscreditorcouldnotbelocated.Nomorasolvendi.1241.Paymenttoapersonwhoisincapacitatedtoadministerhispropertyshallbevalidifhehaskeptthethingdelivered,orinsofarasthepaymenthasbeenbeneficialtohim.Paymentmadetoathirdpersonshallalsobevalidinsofarasithasredoundedtothebenefitofthecreditor.Suchbenefittothecreditorneednotbeprovedinthefollowingcases:1.Ifafterthepayment,thethirdpersonacquiresthecreditorsrights;2.Ifthecreditorratifiesthepaymenttothethirdperson;3.Ifbythecreditorsconduct,thedebtorhasbeenledtobelievethatthethirdpersonhadauthoritytoreceivethepayment.

1.1stparpaymenttoanincapacitatedperson2.2ndparpaymenttoanunauthorizedperson3.GR:Paymenttoanunauthorizedthirdpartyvalidonlyuptotheextentofbenefit.Exception:Whenbenefitispresumed:

a.3rdpersonacquirescreditorsrightsb.Creditorratifiespaymentc.Creditorsconduct,thedebtorhasbeenledtomakethepayment(estoppel)4.Notes:a.Burdeninprovingisonthepersonwhomadethepayment.b.Benefitmaybefinancial,moralorintellectual,mustbeproved.c.Nonbenefitornon-keepingthereisnonpayment,hence,legalrepresentativeoftheincapacitatedpersoncandemandnewpaymentonbehalfofhiswardd.CheckoutPeoplev.YabutL42847andL42902checkvalidity1242:Paymentmadeingoodfaithtoanypersoninpossessionofthecreditshallreleasethedebtor.1.Instanceofvalidpayment2.Requisites:a.Payormustbeingoodfaith(presumed)b.Payeemustbeinpossessionofthecredititself(notmerelythedocumentevidencingthecredit)i.Bearerinstrumentextinguished,ifordernotextinguished3.Notes:a.Provegoodfaithb.Attachmentmerelyprohibitsalienation,paymenttopartywhoattachedthepropertydoesnotconstitutegoodfaith(Panganibanv.Cuevas)1243.Paymentmadetothecreditorbythedebtorafterthelatterhasbeenjudiciallyorderedtoretainthedebtshallnotbevalid.1.Paymenthereisvoid.2.Judicialordera.Mayhavebeenpromptedbyanorderofattachment,injunctionorgarnishment3.Garnishmenta.Debtorofadebtorisorderednottopaythelattersothatpreferencewouldbegiventothelatterscreditor.b.Thedebtor-strangerbecomesaforcedintervenor,andthecourt,havingacquiredjurisdictionoverhispersonbymeansofcitationrequiredofhimtopayhisdebt,nothisformercreditor,buttothenewcreditor,whoisthecreditorofthemainlitigation.(TayabasLandCo.v.Charruf)


4.Interpleader:a.Whereconflictingclaimsuponthesamesubjectmatterareormaybemadeagainstapersonwhoclaimsnointerestwhateverinthesubjectmatter,oraninterestwhichinwholeorinpartisnotdisputedbytheclaimants,hemaybringanactionagainsttheconflictingclaimantstocompelthemtointerpleadandlitigatetheirseveralclaimsamongthemselves.b.AandBbothhavereceiptstoclaimmerchandisefromC.Cfilesanactiontointerpleadorlitigateamongstthemselvesfortheirconflictingrights.Courtthenissuesanorderprohibitingpayment.Anypayment/deliverymadebyCwillbeinvalidtantamounttoBF.5.Injunction:a.Ajudicialordertorefrainfromdoingsomething.invalidpaymentifinjunctionisgranted.6.Notes:a.Whengarnishmentproceedingsaresubsequentlydropped,butpaymenthasalreadybeenpaidtotheinterveningcreditor,thestranger-debtorisnotrequiredtopayagainhiscreditorunjustenrichment.b.Pendinggarnishmentproceedings,thedebtorcannotbejudiciallyorderedtopaytheinterveningcreditorsinceitmustbegiventotheclerk,sherifforotherproperofficerofthecourt(Sec.8Rule57ofRROC)1244.Thedebtorofathingcannotcompelthecreditortoreceiveadifferentone,althoughthelattermaybeofthesamevalueas,ormorevaluablethanthatwhichisdue.Inobligationstodoornottodo,anactorforbearancecannotbesubstitutedbyanotheractorforbearanceagainsttheobligeeswill.1.Alsoapplicabletopersonalpositive/negativeobligations.a.Inobligationstodoornottodo,anactorforbearancecannotbesubstitutedbyanotheractorforbearanceagainsttheobligeeswill.Ofcourse,iftheobligeeconsents,thisisallright.2.1244doesnotapply:a.Facultativeobligations;b.Anotheragreementresultingineither:i.Dationinpaymentii.Novationc.Waiverbythecreditor(expressorimplied)

SaleDation

Nopre-existingcreditPre-existingcredit

GivesrisetoanobligationExtinguishesanobligation

CauseorconsiderationisthePRICE(seller);orOBJECT(buyer)CauseorconsiderationEXTINGUISHMENTOFDEBT(debtor);orOBJECT(creditor)

GreaterfreedominpricedeterminationLesserfreedominpricedetermination

1245.Dationinpayment,wherebypropertyisalienatedtothecreditorinsatisfactionofadebtinmoney,shallbegovernedbythelawofsales.1.Dationinpaymenta.Modeofextinguishinganobligationwherebythedebtoralienatesinfavorofthecreditor,propertyforthesatisfactionofmonetarydebt.b.Synonyms:i.Datioinsolutomii.Adjudicationenpagoc.Governedbylawonsalesi.Insubstanceitisasaleii.Creditorisreallybuyingsomepropertyofthedebtor,paymentforwhichistobechargedagainstthedebtorsdebt.iii.Alsoaformofnovation

iv.Requirescommonconsent2.RequisitesforvalidityofDationa.Creditorconsents(arequisiteofSALE)b.Willnotprejudiceothercreditors(statuteoffraud)c.Debtorisjudiciallydeclaredinsolvent(assigneeadministersproperty)3.Notes:a.Notnecessarythatallpropertyofthedebtorwillbegiventosatisfythecredit.


1246.Whentheobligationconsistsinthedeliveryofanindeterminateorgenericthing,whosequalityandcircumstanceshavenotbeenstated,thecreditorcannotdemandathingofsuperiorquality.Neithercanthedebtordeliverathingofinferiorquality.Thepurposeoftheobligationandothercircumstancesshallbetakenintoconsideration.(1)Ifthereisdisagreementbetweenthem,thenthecourtstepsinanddeclareswhetherthecontracthasbeencompliedwithornot,accordingtothecircumstances.(2)Waiver;whencontractdoesnotspecifythequality:a.Creditorcannotdemandathingofsuperiorquality,butifhedesires,hemaydemandandacceptoneofinferiorqualityb.Debtorcannotdeliverathingofinferiorquality,butifhesodesires,hemaydeliveroneofsuperiorquality,provideditisnotofadifferentkind.(3)ArticleisconcernedwithQUALITY;whenKINDorQUALITYcannotbedeterminedwithoutanewagreementoftheparties,thecontractisvoid.(CC1349and1409)1247.Unlessitisotherwisestipulated,theextrajudicialexpensesrequiredbythepaymentshallbefortheaccountofthedebtor.Withregardtojudicialcosts,theRulesofCourtshallgovern.1.GR:Debtorpaysextrajudicialexpenses.(bylaw.Ratio:sincedebtorprimarilybenefitssincehisobligationisextinguished)Exception:Stipulationtothecontrary.2.Notes:a.JudicialcostsaregovernedbyROCRule142.1248.Unlessthereisanexpressstipulationtothateffect,thecreditorcannotbecompelledpartiallytoreceivetheprestationsinwhichtheobligationconsists.Neithermaythedebtorberequiredtomakepartialpayments.However,whenthedebtisinpartliquidatedandinpartunliquidated,thecreditormaydemandandthedebtormayeffectthepaymentoftheformerwithoutwaitingfortheliquidationofthelatter.1.GR:Paymentshouldbecomplete,partialperformanceisnotallowed.Exceptions:a.Stipulation;b.Differentprestationsaresubjecttodifferentconditionsordifferentterms(installment);

c.Debtisinpartliquidatedandinpartunliquidated,performanceoftheliquidatedmaybeinsisteduponeitherbyeitherparties.(3M+damages,3Mcanbedemanded,damagescanbedemandedonlyafteramountisdetermined);d.Jointdebtorpayshisshareorthecreditordemandsthesame(fullpaymentofjointdebtorsdebt,butonlypartialpaymentastowholeobligation)e.Solidarydebtorpaysonlythepartdemandablebecausetherestarenotyetdemandableonaccountoftheirbeingsubjecttodifferenttermsandconditions;f.Incaseofcompensation,whenonedebtislargerthantheother,abalanceisleft.g.Whenworkistobedonebyparts.1249.Thepaymentofdebtsinmoneyshallbemadeinthecurrencystipulated,andifitisnotpossibletodeliversuchcurrency,theninthecurrencywhichislegaltendedinthePhilippines.Thedeliveryofpromissorynotespayabletoorder,orbillsofexchangeorothermercantiledocumentsshallproducetheeffectofpaymentonlywhentheyhavebeencashed,orwhenthroughthefaultofthecreditortheyhavebeenimpaired.Inthemeantime,theactionderivedfromtheoriginalobligationshallbeheldinabeyance.1.Legaltendera.Thatwhichadebtormaycompelacreditortoacceptinpaymentofthedebt(whetherprivateorpublic)2.Checksaslegaltendera.Checksarenotlegaltender(Villanuevav.Santos)b.Managerscheckisnotlegaltender(Cuaycongv.Rius)c.Instanceswhencheckislegaltender:i.Creditorisinestoppelorhehadpreviouslypromisedhewouldacceptacheck;ii.Checkhaslostitsvaluebecauseofthecreditorsfaultiii.Whenpaymentoccursnotbecauseofadebtbutbecauseoftheexerciseoftherightofconventionalredemption3.Notes:a.AskifyoustillneedtostudytheJapaneseRulesforBARpurposes.


1250.Incaseanextraordinaryinflationordeflationofthecurrencystipulatedshouldsupervene,thevalueofthecurrencyatthetimeoftheestablishmentoftheobligationshallbethebasisofpayment,unlessthereisanagreementtothecontrary.1.Inflationa.Sharpsuddenincreaseofmoneyorcreditorbothwithoutacorrespondingincreaseinbusinesstransaction.Sincethevalueofmoneyheretendstodecrease,thenaturalresultisanincreaseinthepriceofgoodsandservices.b.Deflationisoppositec.Extraordinarywhendecreaseorincreaseisunusualandbeyondthecontemplationofthepartiesatthetimeoftheestablishmentoftheobligation2.Notes:a.1250appliesonlytocaseswhereacontractoragreementisinvolved.Doesnotapplytoobligationstopa

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Oblicon Notes 2014 - Atty. San Pedro (rAW)