Obligations" A juridical nocessity t0 give, fo do, ut not io do, It 1s Impressed with the character of enforceability REQuisites: 33.00 4. Vinculum Jurta or burtdteat tle = the affcient ‘cause established bi vailous rources of ‘obligations (law, contracts, quasl-cortracte dalicts and quasi-deliet); may arino other from bilateral or unilateral acis of persons; 2. Aetive subject ~ ure who can demand tho fulfilment of tite obligation; aka etligecicreditor 3, Passive subject ~ fcori whom the obligation Is Jundieally demanelubie; aka otligoridet tor Note: Subjects pertain to beth natural and Juridical persons ‘Objoct -tie prestation or conduct required to ‘be observed by the debtor (to give, to do, or rot to do}; itis not a tring Roquisitys of & Prostation a. itmust be lick; b. itmust he phystenily & judicially posit cit mutt be dete ninata or deterinnte; and . it must have possible equivalent In money. Note: FORM Is sometimes added us a fith requisite but 28 a general rule howover, It cennot be considered as essential, SOURCES (Art, 1167) - 4. Law 2. Contracts 3, Quastcontracts “ 4. Delicts 5. Quasl-detlots ‘EXECUTIVE COMMITTEE, PERBENT CALVIN ABUGAN over chat and ehie academies operations, MANOUD ADEL SANTOS tal for operations, UAW CAMU.CS ULSTRO en hao acer MAE AN SELICETARG vce ca Aeron eeu MEMO}Y AID IN Civil LAW| 117, Note: The list of aourcas is EXCLUSIVE (Sagrndo Omion v Necaos, 6.% No. L+3756, June 30, 1952). HOWEVER, Tolentino _givos_ another snurce. UNILATERAL PROMISE, «It may be based on (1) euniract or (9) law CONTRACTS Obligations arlsing from contracts have the force of law between the convacting parties and shoul! bbe complied with in good faith (Art, 1159), Cornpliance in yood falth Is performarice in accoraance with the stipulation, clauses, terms and ecnditions of the contract, The terms of the contizct determine the respective obligations of the parties thereto, If Ihe leims uf 2 conlia:t are cleat and leave ro" daub! upon the contracting parties’ intention, such tems, should he appilad ka thelr literal meaning (Sps. Dumiso v. Merion Rea! 4, GR. No. 131491, August TER aA sii LCONTRACTS «: gers Waele, me aes hother. te pti ORAGL A TAI vice for tere KRIRSINE ANNARELED OS ea chal for france IREENE XINY ACOSTA le chal fo, ACE IELO CONCEPCION ich fron ies emia: FRANCESCA LOURDES SENGA jubitet Ml SHEENA MARIE ABELLA avetartsbjetehal, ACE ARVIN OPH! dp, PRANCESCA LOURDES SUNG ‘eisers an fay relations, CRISCELIN CARATUGAN eronerty, IA. PELIA CORAZON PALO and AINPY IY ANE GALANG wil nt ccs [MARIA DANIAFLOR BERAMO nod ALLEFW INFANTE Oban and wns, MARY IVY ANNE GA NC sent! eps, EVA CALNE HAP Parmer, agerey and tre KATAEREE ANS ASLO cree Wansetins, SHEENA MARIE ABELLA is aed Aig, JAM PEARL PCR UGAL len ‘es and dads, JAN MANLELE REYES confet of laws ments: Alden Abo UleydEiene Apostet Joana ell, Jonas Asoo, Paulie Narn, bara sft Eilat, Aen are, tena les eth France cones, Anetta Calsiang, Ulzh Cano, Resin Faia Ch, Seeceto Clraval, Diane Therese Daur, Herat Gans, Hah Lanne Domingo, Ana Ofada delos yrs. Ramana Diorg Clas Lasto-Caenina, vals Espns, Dok Foo, trojan Noa Worth Gila, Kcstine Carmela Gonzales, Oaley of nova, Roehl Jose, Jacky Lert. Foca !ren, Jerome Matas. erbert Mate, Chale Clr, Menor, Kristel Concepcion Ua, lena Wace Pag, Pat lan, "hina Santee lo esa Sane, Cnty Says, Maty May Sat dare! Caria Taub, Florence Teleio, rin Tere, Gila Vilaveve, uan Gace Wisan, co uni, Nad Conan, Dro 8s st21812009 CENTRALIZED DAR CPERATIONS Kirds of quasi-contracts 1, Nogotlorum — Gastio = voluntary management of the property or affairs of ‘unottzer without the knawladge or consent of the alter (Ar, 2144-2189) 2, Solutio tndebit! ~ juridieal relation which {is created when something I received ‘when there Is no right to demand it and it was unduly delivered ay raistake (Art 2164-2163) 3, Othor cases ~ (Art, 2164-2176) KINDS OF OBLIGATION |. Viewpoint of Sanction 1. Civil Obligations ~ give a night of ation fo zompel their perfomance, 2, Natural Obligations = qo! vased on positive law out on equity and natural law; do not grant a rignt of action to ‘enforce their performance, but attr voluntary fulfilment by the obligor, they avihorize retention of what has been delivered or rendered by reason thereof, Givil Obtigatlon and Natural Obligation Distingulshod Tatice 1423 | 2, Based on equity and natural ew 3. Hot anforceabia By ‘ Amtcla 1186. 2 Based on postive [aM a. Ghisieeable By court action or | court action coercive | powerlauthority, BSS 3, Moral Obilgations \~, those that cannot “be enforced by action but which are binding on the party who makes It In consclence and natural ‘aw, . Vlowpoint of Performance 4. Positive Obtigation = to give; to do 2. Negative Obligation ~ net to do MW, Viowpoint of Subjoct matter 4. Personai Obligation ~ to do or nat to do Real Obligation ~ to give a, Determinate oF spucific ~ object is pariculatly’ designated or physically segregated from all other af the same cass b. Generic = ebject Is designatea mereiy by its class or genius © Limited generic thing = when the generic objects are confined to a ie San Pers College of Law particular class, e¢. dn obligation to deliver one cf amy forsas (Tolentino, Volunna WV, p.91) WV, View point of Porson Oblignd 1, Unilateral ~ only one ayuty 1s bound Bilateral~ both partys are bound RIGHT GF CREDITOR TO THE FRUITS (Art. 1904) 1. Bafore dolivary ~ porsanal ight 2. After duilvary ~ real right Porsonal Right and Kas} Right Distinguished Tous 70, 8 tight enforceable" only | enfurcéablo against against definite | ure wiele world parson or group of | a 2H ig rian poraning Oa] the person to demand | parsen over a specie from another, as al thing, without a detinte ‘passive | passive | subjact subject, the fultiment | Individual of a orestation 12 | dotermined against give, to do of not to | whora such right may do be personaly L enforced OBLIGATIONS OF THE DEBTOR 4. Detorminate a. Specific Performance b. Take carSan Beda College of 7, RIGHTS OF A GREDITOR IN REAL OBLIGATION 10 GIVE (Art 1768) 4, Dotorminate a. To compel specific, performance witn right to be Indernnified for damages b. To demand rescislon ofthe obligation with fight to recu ver damages & To demand payment of denayer ‘hen it's the orly feasible remedy 4. if the obligor delays, or has promised to deliver.the 3m thing to two or ore persons ‘vha do noi have the ‘same interest, 1x: shall be responsibie for any fortuitoss event untit he tas effected delivery 2 Generic & To sk for performance of the obligation 'b, To ask thai the cbiigavon be complied with at the expense af the debtor 2. To recover damages In caso of breach of obligation WHEN OBLIGATION: TO DELIVER THE THING AND THE FRUNS ares the source of obiiyation 1s taw, quasi contracts, deli, quass- delet, I arlene from the time ‘dosigna‘ed by tho inv creating or regutating thei 2. If the source Is con.ract, it arisee spon perfection UNLESS thera Is © stipulation {othe contrary PRINCIPLE OF BALANCING OF EQUITIES AS APPLIED IN AGTIONS FOR SPECIFIC PERFORMANGE: In specific performanra, ‘equity requites that the cortract bs just and equitable in its provisions, and that the consequences of spaciia performance likewise be equlteble aad Just, The genarnl tule is that this equlia've ‘elle wil not be granted if, the recy of tho specific. performanco of the conirse! would be harsh, inequitable, oppressive or resuk in an ‘unconsoloriable edvantaye to the pialntif {Agonoill v. GSIS, G.R. No. 30066, Aucust 30, 1908). RIGHTS OF A GREDITOR IN PERSON) OBLIGATION; “TO.9O OR HOT TO D (art 1107-1 409 hte hes beon fden_him, the Ni LIMRACO Mean Sieciad”~ aT ihe | obi gas aha Rave he experse of tho | folowing remediae: obligar (Excest wien | 4.0 have: tt undone the prestation | at the expense of tne | consists of an act | oblgor: and where the personel qualifications of the | 2. to ase for damages | | jStenecl ot te under Art, 1470.) ae | because of breach of Lhe obligation CASES WHERE WHE REMEDY GRanTEO UNDER ARYICLE | 168 If NOT AVAILABLE: 1, Where the affects of the act witoh ts forbiidon, aro dotinly in charactor - ‘even if ta porsibie fore obliges to ork that the act bo undone at the éxperve of the obligor, consoquonces permenent in ccharucter and conteary to the object of the ottigaion will be produced 2, Whorw it Is physically or legally imoossible to undo what has boon undone bacause of the vary nature of the fact itelf or of a provinon of law. of derause of conficling rights cf thid parsons Note: In either vase, the remedy Is to ask for Coron OE Be cy NOS'OF BREACH! OF OBLIGATIONS involufia’y' dell unable tox svete be ss ng fous 278 ck td fora ince of rf i ee ae q Fer) MEMORY AID IN CIVIL LAW| 139120 12009 CENTRALIZED BAR OPERATIONS Doley in the performance of tae obligation, however, must be eliher malicious or nagigent. f delay is only due io Inuavertence vwathout any malice or nagiyence, the obligor cannot ba liable under Art, 1170. (ROBE v CA, G.R. No. 133407, March 25, 1999) Roquisiios in order to considar the obligor in ‘iotault: (SSS vs Moanwalk Ouvelopmont and Housing Corpoatian G.R, No. 73345, Apiil 7, 1993) 1, Obligation Is demandable and already liquidated 2, The obligoridebtor delays performance 3. Tha creditor requires performance judlclaly oF extrarjudcially Note: Art, 1169 is applicable only when the obligation is to give something over than payment of maney, in which care, Ar. 2208 shail apply Kinds of Gefeut: 1. Mora solvenai + delay of the debtor to porform his obligation, it may b 'x re — vbligatlon Is to glve Fx persona ~ obligation ' to do ‘There Is no mora soivendi + {In negative obligation; one can never be tate In not doing oF not giving something + In natural obligation; the pertomance is optional on the part of tha debtor 2. Mora aceiplendi - delay of the creditor in ecopting Gelivery of the thing which Is tha ‘object of tre obligation Roquisitos: & Offer of performance by tte, dedtor Who has the required capacity, , Offer is to comply with the prestation 3 it should be performed and ©. Credilor refuses the perfomance without Just cause, 3. Componsatio. morao = delay of the parties or obligors in raciprocal abiipation Rulos on Dofoun: Unilatora! Obligation Gevovel cule: Oemand is necessary. No donund = No delay. Mare expiration of the peviod fixed by the parties wil not cause delay ymmencement of 2 sull fy sulticlont demand sPuimevas v 4, GR. No, 120490, March 34, 1998) Excoptions: 1 Wien obligation or law expressly oo declares ti wg coicoansetea for fi og : Wares of ead RD ob 2. When ihe time for fulflinent of the obligation is of the essence’ uf the contract 3. When demana would be tes Note: Mere stipulation of matur.ty date Is not enouga to disperse with the neil to demand; the words “without tha need. of demand” ‘should appear in the face of the instrument Contracts with acceforetion nlause ~ if there is default, one can demand’ ior all instalment payments, however, there stil hag to be & demand from the creditor Rola: Prior antraludicial deniand 1s not necessary before a suit ray te filed when obligor defaults Exceprions: Ejectment cases; and. Consignment cases, (Sta. Maria; 2 ad, 2003! Reciprocal Obligations... - Created. or ‘established at thy same time, ouf of the sare cause and which result In mizual relaionshiy between the parties, General rula: Fulfilment by both parties should be simultaneous; one party incurs In delay fram tho moment the other perly fulfils his obligation, whilla he himself does nit comply oF is not ready to cainply in @ prover manner with what is iioumyant upan him, Exception When diferent dates for the performance of obligation is fixed by the paris. Demand 's necessary only in such case. ae MeN oe ( ae ca re ste a ae Bh onal Ne i nh thing of the ‘held table for Soa Woda College of LavoSan eos College ef Way 2. Mora avipondt Bears the gk ofthe thing dive + Fer obligation 19 pay money, debtor not lable for vs torest from the time of creditor's delat + Dobtor may ra ease himset! from the obligation by «cnsignation of the thing due’ 3. Conpensatio mora, + Deley obligcr cancels delay of the obliges and vias varsa + Ro actionable derrult un the part of both partion + delay of on party i followed by tnat of the other, tao taaiity of the feet infraclor shalt 2¢ equitably balanced by the cours, if ft cunnot be determined wiich of the parties is gully of delay, the vartract shall bo deemed extincviehsd und exch shell bear his own dy mages (Aut 1192) Wl. Fraud (doto): Cénicious and intenional proposition {9 evade the normal fulfilment of an obligation. Implles come kind ef malige or dichonesty and cannot cover cases of nilstake und errors In Judgment irade Is good falth In such case oblie! can be held liable for daniages Waiver of Fraud 41. Future fraud cannct be: waived becauee It Js contrary to faw aved pubte policy. 2, Walver of past fraud Is valid; it can be doemed an ect cf generosity. What Is fenounced is the eféc of raud or he rt to indent. Civil Frauds i)'stinguishad Bead Wurst UUs li Tee ie Galatians Weta Ge sou aE 1. Prevent only during| Present aniy during! ithe porformance of alte time of birth or [pre-existing obligation |.erfaction of they apligation (2. Purpose is to evade] Purpose is to secura| the normal {ulfllment|*he~ consent of the| lof the obtigation other to enter into a] oantract_ AYERORY AID IN CIVIL LAW] 121 Resvils jiotinn of consent 3. Results in the. wow fultttent oF breach uf [4. Givas rise to a rght|4, Givas rise °c a right lof the osligee tolofan innocent party to Tecover damages from|acnut the eentract if il he debtor ly causal fraud, of to -pver damages it's} i | tion I, Negtigence (Cal). Aay voluntary act oF omission, therm bela no malice, ‘whlet, prevents the seemal fulilment of an obligation inde of Nagliyance. 1 i Nepigor % Culpa content faut of noglgence ct obligor by vitae of which he. Is Unable. to patorm "his obligation eriaing fora apre-naloing con'ract b, Guba ogitiatarqvastotiet = taut of negigence of a ferton, whose failure to observa the mquiied diligence to the. oblgttion causes damage. to another. 2. Culpa Crimina: ~tsullot negigonve in the commission » came Culpa Contiactyal and Culpa Aquitiana legloence ips a " err Ns ‘of getondai aie ist breach artes. ghttoon ima facke t¥ warrant122 |2009 ceTRALIZED BR OPERATIONS recovery 5. proof of diigence in], proot of diigence in the selection and|the — salecilon and ‘supervision of tha|supenvision of the umployees fs natlemployeus «isa available as defense Ditgonco Requiod 4, That agreed upon by the paities 2. Io the ubserice of stipulation, that required by law inthe particular caes 3. IC bath the cantract and law ara silent, Allgonce of a good fathor of a fanly Diligence of Good Faiher of a Family ‘That reasonable diligence which an ordinary prudent person would have done under the sama circumstances, Wogligance and Fraud Distir guishigcd X uO is moroyfnen isan iert [There |abandonment, cause damage or inattention, injury ‘carelessness, oF lack} jet aiigence H ‘waver of iabiily off Waiver of future aud) flue negigence islis veld ‘allowed unless the! ihatute of the obligation] public potiey ‘requires. extraorainary) i penice, ie, "carrion ity cantot estas by ho cours} educed according to sireuinstanees Note. Whea the negligence is vo gross that it ‘amounts to wanton altitide on the part of the obligor, the faws in case af fraud shall apply. AF tho obligor acted In good faith, he shalt bo able only for natural» and probable consequences of the breach of abigation and ‘hich tho pales nave ferebuae or sould hove eas onably foreseen atthe time the oiligation was constituted i 41 1ho obligor acted io bad faith, the bounceries betwcan negligenca and fraud disapprar allogethier. Obligor can be held responsibie for all “damages which may bo. rearonably San Beds College of Faw attributed to the nonpelformanca of the Obligation, Any waiver or renunclatign which is ‘ade inuntelpation of such ia ty is null ana void. If there was contributory nopigance of the. obligeo, tha effect is to reduce ¢F mitigate the stamages which he can recover, if the negligent act or omisgion of the obliges was the proxinate cause of the ovent which lac to-aamage ar Injury sorrpialnad of, he cannot recover : Robbery, por so, tka cemapping, does NOT foreclose the poselbilty of nagiz nce, It fs not a fortuitous event (Sicem, at al. v. Jorge, GR ‘189647, August 8, 2007) IV. BREACH THROUGH CONTRAVENTION OF TENOR OF ORLIGATION: Under Art 1170, the parase “in any manner contravene the teno? of tha obligation includes aot only” any ile act which inmpaire tho strict and fant fulilmant of tho obligation, bit aleo evory kind of ofective performance. Fortuitous event (Art, 1174) An event which could not be foreseen, oF ‘which, though foresean, was Inevitable, Roquisites: 1, Event mus, be independent of the will of the oblyjor, 2 it must be either unforyseeable ‘or inevitable; 3. Must be nf such @ character 25 to at imapssivig st6ee'neprepionr, to fulfil his See emma. Obiigor tidal Be tres Yr bi} paral in tno ifgtabbugeEBENIy inuty re GC Ca CT LAWgoin Bede College of Ay Exceptions: 4. When expressly decia’ed by law og, Frticle 652(2), 1168(3), 71268, 1242, 2147, 2148 and 2129 of the Civil Code.) 2, When expressly di.claved by stipulation or contract, 3. When the nature of the obtigetion requires the assumption of rik 4, When the obligo: ls in dafauit or hos Protulsed to deliver the tame thing to 2 oF ‘mote persone who do not have the sante interest (Article 11683). 6. When the object of the prestation fa genecic. Note: + Fhictuation cf currercies ts not considered as a fortvitous evert since the Muctuation Tate Is forseeable. it considered furtutious, it wall set a precedent such that there wil boa shit of burden to banka ‘+ Where the contract: stioulated thet in case of @ fortuitous even, the perlod provided In the contract t:t delivery shall be suspended, the SC tuled that the period of time when’ the cotvract’ was suspended CANNOT be dodini ed fom the term of the nontract beraue to add the seid years lupon the resumptian of the contract would In effect be an extension of the contract (Victorias Plontars Assce. Inc v Vietorios, Miling Co, GR. No C6648, July 25, 1855) USURIOUS TRANSACI'ON (At 1175) Usury - contracting for oF racelving somethit in excess of the amount sllow-ed by law fr tho Toan or forbearance uf money, gocds, > chattels There is no fonger ny celing in inter oe: rates on foans puratint to CB Clrcul?r Na, 224 Issued on Dee. |, 1982. EXTINGUISHMERT..Cl_ INTEREST AND PRIOR INSTALLMENTS (Art. 1178) Revoipt of te principal “or latter instalimont, without reservation 3s tthe interast (or pict instalment) shall give “ist ton disputable presumption that the Interest (or pilsr instalment) has been pels. ‘The presumptions In Artie 1176 do not apply + When there Is a recervation mad> orally or in waiting + tf the receipt does not recite thet It wos tesued for ¢ prrtictlar installment due ar when tho receipt is only dated + Topayment of taxes © shore thera Is nonyysnent of the prior abl gations has been proven REMEDIES OF CREDITOR TO PROTECT GREDIT (Ant 1177) 1, To extiaust the propery in peseession of the drbtor subloct to sxomotiens provided by tow Aacion subronotorla - to be subrogated to ol the rights ond ations of the debtor save those which ave Inherent in his verson. + Subject {0 one wary EXCEPTION ~ it cannot ba exercised tn rights which ‘ra purely parsonal in the arise ‘hat they ara inhient In tho person of the dobtor Requisites: ‘a, Debtor io whom thy tight of action properly periaina musi be indebted to the creditor b. Creditor insist ba Sraludioed by the inaction or {allure of the debtor piocced against tha third person Creditor must have fitst pursued or ethaustod all the properties. of the dobtor which ary not exempted for execution 3. Accion pautinna ~ to impuge all the acts which the debtor mey have “done {9 defreud tham by means of rescissory action at the instance ot the ererlitor who Is prejudiced Requisites: (CASK) a. There must be a groditor prior to silenation: b. Oebior has mata a subsequent contract eanveying a “palrimoniol pra ay e. Bla nettoe has ill otmer_ Jeon Frehiey to eh Hehe ag . Tniaethbeihgt li pee 's trey ht ei in ANE Ss reparty He ae 12s ml EREQNN AID IN CIVILIAN] 123_124 009 cenaaiaeD pan onEtarions captors ths sito by LAWS vlc ae sly 2 rere’ ty feRsoNAL GUaLincRTION‘e onthnsdfece os wena yn ral are sondrtinwesbigaion™ | 3. Whan prohibited by STIPULATION of the ae PURE OBLIGATION The oifectvity oF extinguishment does not dopend on the fulfitirent or non-fulliimant of @ enndition of, on the explratior of) a tom or Deri, arf immadataly demendabe Note: The quality of immediato demandabilty is not violated when a reasonebly poriod is ‘raniud for performance, GCNDITIONAL OBLIGATION FEvfectvity is subordinated to the fulilment or onefulliimiont of 8 future AND uncertain fact or avent Charactoristies of a Condition: |. Future and uncertain 2 Pest event but unknown to artes he knowledge to Le acquired in the future of & past event which at that foment is Unknown to parties interested » itis only in that sense that the event 18 be deemed tuncertaia) 3, Not impossible: Note: When the debtes binds himself to pay when nis means permit him to Ho vo, the ‘obligation shall be daemed to be |one with a period (Article 1180) | Effocts of fallure to comply with gondition: 1, Failure to comply with the condition miposed on the perfection of] a contact outs in the faliure of the wontract ‘allura to comply wit the condition imposed on the performance of the obligation, gives the other party an option oitker to. fafuso to procead with. the compliance of the obligation ¢r to waive the consition When objigation damandable at gnco: 1. When itis pure 2, When itis subject to a rasotutely conaltion 3. When itis subjact to a rexel petes i Traditional Cia:sifications of Conditions: 1, Suspensive — fulfilment” of condition ‘esulis in acquisition of rights aricing out of he obligation, Resoliitory ~ fulfliruent of the condition restlts in extinguisninent of tights arising cout of tha obligation, 2, Paxestative = fulfiimant ef tie condition depends on the wil of » pany to the obligation, Casual - ifllmant of ihe candiion depends on chance andfor the will of a third person, Mixed ~ ‘uifilinent of conuitien depends parlly on the will of a parly ot obligation ‘and partly on chance andar will of a third porson, 5. Possible -. condition is capable of realaatian according to nature, law, puble policy °F good cust ams Impossible ~ condilon iy ra\‘capable of realization accoraing to nature, law, pubic Policy or good customs 4. Positive ~ involves perfarmance of an act Nogative - involves tha omission of an act 5. Divisibia = susceptible, of partial realization Indivisibre- not susceptinia of partiat realization 8. Conjunstive ~ there ace _ sevaral conditions, which must al be realized Alternative ~ there are suverat conditions, but only one must be realized, 7. Express ~ vondition is stated expressly Implied ~ condition is tact potestativo, mixed, casuar condition (Art. 1181142) ood yey ei LN futhlinsoib OF BS tha} Kcondition;, oie pH teste Kanlvation IAs” or becomes Bn ens Catlege of LawGoan Mede College 94 3 3 comply with 12st i incumbent upow him. Resolutory conel tian Obligation, —bisomes—— dermandal'n immediately after t's vonsttution and rights are Immediately 1304 in the obligae, but fuch ‘rights aro alway subject to the threat or danger ef extinction. Principia of retrovrstivity applies (Art, 1190 par. 1) 2. Bofore futiin:ent Right recogniaud in Art 1188, par. in case of a susensive condition should Tkewise be evollable in obligationr with & resolutory condition, b. Aftertutfitmans Whatever may have baen paid or cellvered by cne oF both of the parties ‘upon the cons itution of the obligation shall have to be teturmed uyon ine {uililment of the condition. There is Fetcrn to the stotus quo. When condition is not fulftled, rights ‘re consolidated end they become absolute Potestative conditfon + When it depenis exclusively upon the will of creditor = condition ang obiigation is val. + When it depends oxctusively upeti the vill of debtor in case of a suspensive cendition = condition and obiigation Are void; to allow such conditon would be to sanction ilusony obligation, ir direct contravention of the principle announced in Ait, 1303, + When it depete s exclusively uzon the will of deblor si: casa of a resoiutary condition = corvitlon and obligation Is valid; the postion of the devier is exacily the aire 48 tho ereilitor in e suspenslve co‘dition and does not render the obligion tisory. Note: if the objigati.: Is a pre-existing ona, ‘and does noi den and for its existence Upon the fulliinen: by the debtor for testalive, only “L19 condlition is vol leaving unaffected: tha obfigalion iteeit, Hera, the condition keposed net on the irth of the obligation but on ite fulfinent (valid obligation) If condition. 1s Uastared wold bu: the obligation is stil vaiMf;tho SC ruted thot in converting the otligaticn into @ pure end domandable ong, af airangenient may be enforsed which is not within the contemplation of tte purtie, The best solution fe to wonnider the parties ao 0 having intended a PERIOD within which the valid obligation is to be complied with such that the creditor should ask the court to fix @ perloc! for cnmalianee, (Patonty v Omega, G.R. No. LA, May 2, 1953) 4, Casual coriditto The obiigation and condition shall take effect, 5. Mixed condition: The obligetion and. condition shall (eke effect Effects of impossible/uniawful condition (Art. 1103}: Effects of impossible conditions 1. Conditional obligation ix volt = beth obligation and e:mekiny are void 2. Condionat obigation 1 valld ~ if eundition is negative, iis ceyerded and obvigation ja renderag pura and valld 3. Only the affected obigation ts void - ifthe obligation Is divisible, the part nol affected by the imponsibie condition shall be val 4, Only the condition Is void « If obligation 1s pre-existing, not depending on fulfilment ‘of the condition whici ia fmpossisie for Ite existence, only (he condition is void 5. Conlon’ considered not Imposed = if impossiblefuniaedct condition is uttachect 'o a simple or temuneeatory donation os weil as to a testamentary disposition, condition 13 considered not impos2d while the objization Is valid Erfosts of posto ss negative onion (Art. 7184-1185) Male sonar oan extipgulghs0fapABaRine:the time expires atte Feber Ihe erent wil At lake place, one, is in negatwe ‘Re te ‘obtgg effective. strom the 2inoment ime Fidlgated.tias.tapyed.oF i iL paeifibone wifont ghat_ the aitnvseangeesaccur, WMERDIEALAG nao. yet Tee inteion fg nto nat gation, e id for ier lesenat ttle MNiriont of coflition fart, IF dee When the fe obliges trom witfon;, prevention is 125 NE 26ORY AID IN CIV AW! 12512612005 CENTRALIZED BAR OPERATIONS must have beon voluntary or ital in character, 2. Boctine applies unly to suspensive condition, It cari have no apotication to an external contingency which '9 awfully vithin the control of the obligor (Taylor vs. Uy Tieng Pa, GR No. L+16109, October 2, 1922), 3, The mere intention of the debtor to pravent its liappening or the mero placing of Ineffective obstacles to its compliance, without actually preventing fuilliment is ‘oot sufficient (Manrosa), ‘Note: When the voluntary act of the debior dic frat have for lls purpose tne prevention of the fullilment of the condition, i wil not fall undar consiuctive fulfilment. “The some is true when the deblor acts pursuant to a right (Tolentino Vol WV, p. 161} Requisites of Constructive fulfilment: 1, Condition is suspensive 2, Debtor actually prevents the fulfilment of the condition 3. Ho ects veluntarlly Principio of retroactivity In suspensiva conaltion (Art. 1187) 1. In obligations to give + Roto: the condition is only an accidental element of a contract. An obligation can exist even without being subject to a condition + Rule on relroactily has no sppiaton to ool contracts; hey are portected ‘only by delivery of vie object of the obligation; principle nly ‘applies to consonsuul contracts b, Contracts in which the obligation arising therefrom can only be rec'ized with successive peiods or intervals (e.g, lwese, hire °: service, life annul). + Relroactivo effect as 10 the fruits end inerests In obligations 4 a. In Recipies: Obligations: no rovonctivty = rautually compensaad (frits may be natural, industrial or civil) >. In Uniiatera’ Obigations: retroactivity because it is usa gratuitous unless intention was otharwise, as infaried from malice ‘and clroumstances “Te 2, In abligations to do or m2 (o do + No fixed rule; Courts «ra empowered to datormine ‘the revozctive effect of the suspensive condition ‘+ This rule also applies to an obligation w: cosslutory condition (Art, 1790 par. 2 Rights. ponding fulfiiment of suupansive conuitions (Art. 1188) 4. Creditor + May take or bring appropriate actions {or the preservation of his rights + Goes not grant any preference of credit but only aiksns chs. bringing of the proper action fer the preservation of the creditor's rights + Aopiies to resalutoty conion 2. Debtor 2 Fe recover wai seas pad by musiake before the happening of the sulspensive conditions + But if payment isnot! by mistako, debtor 1s ‘teomed to have impllediy vwcived. the condition; he cannot recover wa! he has prematurely palé once the suspensive condition Is tuttited Effects of loss, da'erioration and Improvement in real obligations (Art. 1185) Daring the pandency ofthe conctton: goes out of commeice; disappears in guch @ way that I's existance is unknown er it cannot be rewovered) a. Without a tau» obligation is extng oe ag enpbligction is pdemnity es BDA ye itil eat na ox Mfrs YE wIBfcitor pS thal granted Ans. 679 and San Beda College of KatyShe alle oe eere ener! The above rulos apply 19 the folfowing: 4, Determinat things * b, I eve to the naiitgence of the obliver obligor is rt Rabie Note: Acrording 19 wurato: "it fs aubsniter! that whatever ray bo the cause of the lossideterioratio nf the thing Intended a5 @ substitute, ouch Joas oF deterioration hall not render it debtor lable.” 2, Aftor substitution ‘s mace: The loss oF detetloration. of the “ubstitute ‘on uccount. of the obligar’s delay, egligerss or teiud.— obligor is. lable because once substitution is inade, the ‘obligation is convarted Into @ simple one with the sudstituled thing as the object of the obligation, Note: Creditor ‘cannot be compelled to: receive part of ore and part of another undertaking VOINT — OBLIGAT:ON. MANCOMUNADA) The whole cbligation is tobe pald or fulftled proportionately by diferent debtors or demanded proportionately by different creditors, (OBLIGACION SOLIDARY OBLIGATION (OBLIGACION ‘SOLIDARIA) Each one of the dettots is bound (o render, anc/or ach one of the everiiors has a right te demand entire compliace with the prestatton, Nature of & Cotlecthyt Cbiigation (Art. 207) Generel rule: Obiigat'on is prosumed joint if thore Is concurrence (1 several cvecitors OR of ‘several debiors OR J sovetal creditors and debtors In one and thé. same obligation Exceptions: : 1, The obligation ox) easly stated that there 18 solidarity «* The faw requires «eliaarity Nature of he obligttion requires solidarity When a charge «condition ic Imposnd Upon heirs ar logitsec, and the teetamert ‘expressly makes:tho charge or ccndition Jn solidum (Mantes) 8. When a sclitary seaponsibitty is Imouted by a final Jucimont un several defendants Prinelpal Effects of Joint Liability °° 1. Dentand by one creditor upon one debtor, produsns the effects cf dafaul only with respect fo the ctadltar whe demanded and the debtor. on whom the’ damand. was made, but not with respect to others 2. Interuption of reerantion bythe fuditn semand of 05 « ‘upon a debtor, does not banc te other creditors. not interrupt the prescrtption as to. othar debtors 3. Vioos of each oviigation arising from the vreraonal dnfect of a particular deutor or creditor does not affect the abigetion or right of the others 4 Insolvency of «i dettar does not invrease tho responsitilly of his co-debtors, nor does it authorize & creditor. to demand anything from his eo-debtors 5. Delense of res jeitenta Is not extendnd from one debior te another (Tolantino Vol 1V, pp, 219-220) Note: Even if the paitiee stipulated in thelr contract that the obiigction of the deblor. is solidary, but such contrast was superseded by @ JUDICIAL DECISION. arising trom suid contract between tha parties juciclaly eciaring the obligation to be meroly joint, th» sald decision must be enforced In a joint manner (Griental Philppines Company v Aboto, 60 Phil 723) Sclidacy llabilty is cetennined by the tenor of the contract NOT oy judicial admission by the arty. Joint Divisible Obligatina (Art. 1208) aan eae a eg for the paymel here. of the redit ie gon aes: ontyddr iGo paymeRtstMatp-eHEhfonate aha bome by hin BGeonse puraly personal 733 na MEMORY AID IN CIVILLAW 233.132 [2009 CENTRALIZED BAR OPERATIONS fo one of the debtors, he alone can avail himself of sucti defense, Joint Indivisibia Diigation (Art. 1208) 1, No creditor can act in representation of the other, 2, No dabtor can be compelied 1u answer for the fiabilty of the others; 3. If there are two or more sebtar, the fulliinent of or compliance with the obligation requires the concurrence of al the debtors, although each for his own share 4. I there ate two or morn creditors, the concurrence of collective act of all the ‘radios, although each for his own share, Is also necessary for the enforcamant of the obiigat'on In casa of broach where one of the Joint debtors falls to comply with his. nlastaking, the obligation can no jonge: by fulltled or performed. Cons2quently, I Ip converted into one of indemnity for damages, {In caso of insolv ancy of one of the dabtors, the colhers shall not be lable for his shares. To hold otherwise vould destroy the joint character of the ailigation, Interruption of poriad of prescription: W there are two oF snore creditors or debtors, wil the claim of a creditor addressed to 2 single deblor of the acknowiedgement mado by one of the debtors in favor of one or more of the creditors be suficlent to interrupt the petad of prescription? Two views: 1. Att, 1209 merely providis thet the right of the creditors may be preludiced nly by tholr collective acts, It can therefore be Inferred that should’ the’ act of a. joint editor be per se beneficial to the others, 19 Gct of one Is wulfcient (Marcos), 2 The act of a joint creditor which would ordinary Internlpt the” peried of prescription would not be valid because tho Indivisiole character ef the obligation requires collective action of tno creditors to ba effective (Tolentino). Nola: Accaréing to Jurado, itis submitted that ihe later vie Is more legicat er etn ent rene nar nents aterennrencnet ____ San Byya College of Law Indiviatbilty and Solldarity Distingulehod (Art, 1210) fofers to the]. refp"s to the legal ti| restation ——whichjor vlacium Juris, and! lconsttutes the objecifconsequently to. the| ot the ohilgetion subjecia or partes of| the o2i gation | '2. plurality of supjecte|2. plurality of eubjecta| is not veq red is incispensable 3. in case of breach,|3. wien there | obligation is cunverted|ilabilly onthe part of| into one of indemnity |the dablors because of| for damages because|the - breach, the| the indwvisibity of the|solidanty. mong the| obilgaton is]debiere remains: ‘debtors —are| Ma ether Wabior i not liable if one destor|propiriignately Hable| lis insolvent for te insolvenvy of ‘Solidarity (Art. 1217) i Solidailly may 2xist althoug!. creditors and debtors may no: be boung in the same inanner and by the same periods and conditions. Kinds of solidarity 1. Aative (solvarty aciong ereittors) A vinculum, by vidue of which each of them, in felation to his co-creditors, possesses the character of creditor only with respect to his share in the obligation, but In elation to the common debtors, tepresent all ofthe other erediiors. Effoct: The creation of a relationship ofSan Beda College yf Lat " " entire obligation riius. the portion’ or shere Which eorrusponds 1) fo. deblor affected by the condition or peril.” Effects of projudtclal: and beneficlal acts (art $212) Each one of the tclisfary creditors mey 49 whatever may te: useful or beneficial to the others, but no: enythiny which may be preluciclal to the fatter. 2, As far ag the debiaris lel are concemed, a Prejudicial act performed by 8 solidary creditor is binding; en beween the soliaary raditsrs, tha credtor who performad such ect shall incu’. the obligation of Indemnifying tho ethers for damages (Castan), Effects of assignmost. of rights Insctidary ‘obligation (Art. 4219) General rule: A solitary creditor CANNOT ‘assign his right because It Is predicated upon, mutual condense . meaning — personal qualification of each creditor had been tsko> Into consideration whan obligation was. ‘constituted, Exceptions: 4. Assignment to co-ereditor 2. Assignment is with consent of co-credite; To whem payment must be medo In solldary obligrtion (Art. 1214) General rule: Poymont may be made to ony of the wolidaty creditors Exception: if domard, judicial or oxtia- Jusiclal, has bee mde by one of them, payment should be mes to him, Effect. of Novation. Cémpansation and Confusion, and. Ruintovlon In Solidary Ovtgation (art. 1276; Ari, 1210-1220) Novation * 1. tia proud, the euler credtor who effected the novatlsh shal relmburee sho othery for damege.i incutred by them; 2. ff It Is" beneficial anit’ ‘he: creditor who effected the’nevéton le able to excite performance! of hii: obligation, - such Croditor shall ba Tet le to the ‘othess for tne share vitich conett ends to them, not only in the obligation, bit als In the benef 3. IR Is effected’ ty’ substituting another person in plece.of {x6 debtor, the tolidary creditor wire effect the novation Is liable for the acts of tha new: debtor in case thera is deficleney in performance: of-ln case damagns are hncurred by the other solidary creditors 38 a result of the substitution; 4. IF it is effected by subrogaling a third person in the rights of lhe solldary creditor responsible for the novation, the abiigation of the debtor sr creditors Is not in reality extinguisned, becanse the felation, between the other crevitors hot eudstituted fn6 the debtors la maintained. Compensation and corfusston 1. Ifeenfasion or comtcensatlon Is partial, the rules regain epplication of paymen! shail apply, without prejudice to the right of ‘thar creditors who have not caused the confusion cr cumnperidation to be reimbursed 10 the extent that thelr righte are diminished ne affected: 2. If the confusion or compcnsation is total, the obligatien ts extinguished, what ie\ left is the ensuing labitty for reimbursement within each-group ~ the creditor causig the confusion or cempensation 1s obliged to reimburse the other creciors; tha deblors benefted by the extinguishments of the obligation ara obliged to reimburse the debtor who made the confusion or compensation possible, Romiseton 1. tit covers the entire obligation, abligaticn is lotally oxtingulshed 2. Ifitis for the bonelit of one of the debtors covering hl entire share, he Is completely released from the craditor/s, {fits for the beneft of one of the debtors and, tof his: share, his ah i AM BROA 133 IAEMORY AIO IN civil. LAWL 133334 12009 CENTRALIZED BAR OPERATIONS Effoct of Domand Upon A Solldary Debtor (art 1210) ‘The demand made against o1¢ of them shall not bo an obstacle to thase which may subsequently ba direclod against the others 80 long 26 the debt hiss not bear, {uly collected, + The creditor may proceed egainat aay one of the soldary dablors or ugainst all of ther sinniltanoously. + A creditor's right to proceed ageinst the eurely exist Independently of his right to proceed against the principe Note: If @-clalm from one of the solidary debtors has bee. dismissed by @ court on ‘grounds other than the extinguishment of he ‘whiole obligation o that the claim has prescribed, it does nct necessarly mean hat the solldary Indwbtedness cannot be clalmed against the other solidary debtors who were rot impleaded In the. cage or against thiose who were impleaded but whose liablity was found by the court as proper. (Inciong v CA, G.R, No, 96408, Juno 26, 1996) Fefect of Paymant By a Debtor (Art, 1217 And Art, 1218) Fayment made by one of the solidery debiors ‘extinguishias the obligation. + if two or more solldary debtors offer to pay, the creditor may crouse which offer to accept. + Solidary debtor who made the paymant ‘merely entitles him tc claim trom his co- deblers the share which corrasoonds to ‘them with interest; trom the. tina of payment. It does not creas a real caee cf subrogation + Mo-telmbursement if payn.ent Is’ nade aiter tha obligation has preecilbed or has become ‘ilegal. If. payment ws made before the debt bacame dus, no interest during tha intervening. period may be demanded, 4 Whon ‘one of the sulidary debtors caunot reimburse his. share to, the debtcr paylng the obligation due to Insolvency, such share chalt be sone Ly all his co-debtore, In proportion to the debt of each, : © The recaiving creditor is Jointly lable to the ‘otnars for thei! correspanding shares Effect’ of loss or - ‘possiblity of portormarce In. solldery obligation (Art ‘4224 1. Tit r not due to the fault and before delay of the aolidary debiore, tha obligation is exineuished, 2. If the {oss or Impossisiity is due to the fav! of one of the golldsry debtora OR cue to o fortuitous event after ona of the sotidary debtors hud alraady incurred in delay, the obligation ts converted into an abiigation of indemnity tor damages Lut the validary character of the obilgation roinains, 1 Dofonses Available 19 4, Solldar Dobtor (Art, 1222) 1. Defenses derived from the very nature of the obligation 2, Defenses personal to ira or pertaining fo his vain share 3, Cefenses personal to 1.0 others, but only ‘8 regards that aart of tie debt for wie the latter are resnonsible DIVISIBLE OBLIGATIONS “Those which have a8 thelr abject a prestaion which is susceptible of: partial performance without tne essence of obligation chaged. Note: Divisiblity! Inciviiblty of the ciligation ‘refers to the performance of the prestation and rnot to the thing which is the object thereof, Divitultyindlvisiolity of te thing rofers to the prestatlon itself INDIVISIBLE OBLIGATIONS, ‘Those which have as thel- object a prostsloh it +_ Sui Beda College of HatsSan Boda College ef Lats obligation consists; reittior may the dehtor be required to make par taljayments Exceptions: 4. When the obligat or expressly stipulates the contrary 2, When the diferain: scastations conathuting the objects of the obligation are subject te diferent terms ant conditions 3, Wnen the ubliga'ian is in part liquidated and in pact unliquic atid Note: When thers I8 plurality of debtors arid creditors, the effext of: divisible indivisible character of the obligation depends on whether the ebligation -s joint or volidary’ Mf solidary— Ars, 1211 to Art 1222 apply joi divisible ~ aut."1208 Is applicable © If joint indivisible = Art. 1208 end 4224 apply Broach of Joint indivisible Obligation. (Art. 1224) Obligation cen be enfotced only by proceeding against all of the dehturs + If anyone of the debtots shoul tall or refuse to comply with, the ebiigation, it Is converted, Into one “et indemnity tor damages + Deotors: who. may have’ been feady ‘0 comply with what is incumbent upon them shall not contribute. {6 the’ Indemnity beyond the cersepording portion of the price of tne thing oF, the velue of the servize In which tho ebligation consiats «The debtor who: failed “tr refused’ to comply with the prastation. shall bear the burden of paying al ofthe damages to tho creditor/s, + tfother debtors ‘es suffered damagoo as @ rosut of the ‘transformation of the obligation into one of indemnity, they may also recover euch; damages. from the debtor who wes at itil; OBLIGATION WITH A FENAL CLAUSE ‘An accessory undertahlig Is attached for the Purpose of 'nsuring its serformance by viriue ‘of which. the deblor af the enti: amount which he has paid iL And al the same time, be subrogated In all te rights of the creditor, , Subettution without the knowledge fi consent of the orignal debtor, and CSGoan Beda College of Lv when’ there In to azreement that tha frst debtdx shall be relented'trom responsibilty, does aot constitute rv1valion, and the creditor ‘can stil enforce - the obligation againct the original dobtor. If the ‘elder debtor it not ‘eleasod, thare Is tio nevation; tha third persout becomes meroly a ca-debfor, surety or co- surety (Marcentila Insuranice Co,, Inc. v. CA, GR No, 86647; Apa 22, 1004). Effect of insolvericy of noncultiimont ny new debtor (Arts, 12941295) 4, Expromision = Tolentino: The ew debtors insolvency or non-tulfment of ‘te obliyation shall not revive the originat ebtor’s lfabilly to the creditor whether. the substitution 1s ‘effected ‘with of witout the knowledge or against the wil of tn original debtor. Jurado: if the suastitution was effected with the knowledge: #nd consent of the debtor, tho new debtor's Insolvency or." nen-futfitment of tho obligation shall revive the orginal debtor's labilty to the creditor. 2, Deloyacién = The 113ht of the erecttor can fio longer be revi.d EXCEPT in the 4 cases: ©. When the inciivency of the new debtor was. alniady- existing and ct public knowledi?3 at the time the when the original debit cleingated his debt, b. When such Insolvency was alrandy existing and known to. the orginal debtor when ho ‘islegated his debt Note: A change In the licilental slements of, ot an addition of such elements to un ‘obtigation, unless othervisy expressed by tho parties, wit not resultin fs eidinguishment, Effects of novatioli’ upon aecesrory obligations (Art, 4296) 7 ‘When the principal ob! ation is oxtirgulshed In consequence’ of .@ -hbvatkin, accessory ‘obligation may subslet ‘sniy insofar as they may boneft thle porsive who ald nex ye consent. # Art, 1290 had. 94 ey ploaton ts novation coffected by eubrogetny a third parson to the rights of the crecior. ‘Such novatton is regulated by Arts, 12109-1304, Effects of condition In févation: 4. If the original obligtition was subject to ‘euspensivel resalutory condition, che new obligation shall b9 Under the same ‘consition, untass it in otherwise stipulated” (Ait 1299), 2. ifthe new obvigation and the old obligation are subject to iterart conditions: a. Ifthe cnnuittons can stand together - {Wf ooth ate {utiles « the new uNigation becomes dma W only the condlion affécting the old ‘obiigation Is fulfited « old obligation is revived while tha new obligation loses ils foree. ony the condition affecting the new obligation Is fullied = there” iu. no ovation since the. requisite of a previous valid ant effective obligation ‘would be lacking ». the conditions ara ingompatbie = the effect is to extinguish the,old obligation 80 that only tho new obligation rexnaing ‘and whose demandablity! effectivity depends upon the tultilmen) aoneifiment’ of” the condition affecting It Hovation Sy Subrogation (Art. 1300) A personal novation effected by suoregating a third person in the rights of the credter Forms of novation by subrogation: 41. Conventional ~ takes plaéa by agreement Of the origiral credltar, the third person substituting the origina! eréctor, and the sieblor (Art. 1201) ‘Legal ~ takes place by aporation of low Conventional Subrogation and Assignment of Rights Distingulshed i peer ESMORY AID IN CIVIL LAWL 14524612009 CENTRALIZED BAR OPERATIONS [s. the “elfects “erises]é, a2 far as ‘he debtor] jfrom the moment offis sonzemed, arises! |novation/ subregation from te “moment off nolicatie haga! subrogation (Art, 1302) Genoral ruls: Legal subrogation isnot presumed, Exons When a creditor paya another creditor who ls preferred, withaut debtor's knowledge 2, When @ third person, not interested in the obligation, pays with tha exaress or {acit approval of the debtor; or Whon, aven without’ knowledge of the debtor, a parson inlarestec' in the fulfiment of the ooligation pays, without prejudice to the effects of confusion as to the latter's share, Flfets of subrogation (Arte, 1303-1804) Total subrogation ~ Trensfere to. the eran subrogated the credit with all the ghts the orginal redltor hac! egainst the debtor oF thi porsone, + Aecessory dbligetions are not extinguished; the person subrogated acquires all the tights the original creditor had against thice persons and the rule Is absolute with respect to legal subrogation. In. conventional subrogation, accessory obligations may be increased or raducéd upon agreement of tho partles. 2 Partial subrogation ~ A creditor, te whom partial puyment has) bean mad ‘axercise his right for the ramaindes, an hho shall bo preferred to the person who thas been subrogated in his place Contracts’ A contract Is a meeting of minds between two persons whereby ‘one binds tuniself, wilh fespect to the ether, 1o.gve Sorsething oF to ‘err some service, ELEMENTS OF CONTRACTS: 1, Egsentlai ~ those without which there can bbe no contract (Art, 1910), 8, Common elements + CONOR l. Gensent 4H. Object or Subject Matter i, Cauae oF Consirgration procent In all b, Spacial elements“ prasent only tn Certain contracts, w.¢., delivery In feat contracts & Extraordinary ime ts = peculiar to spectio contract. ¢.9, price In a contract of sale, ; 2, tatural = those waite 370, derived from the nature of the contract and ordinarily accompany the sama; they are presumed by law, although thay cay be excluded by the contracting partes if kiey 80 dasira 3. Accidantal ~ thove whict exist only when {he parties expressly prevido for them for the purpose ot limfing or rodiying the normal affects of the contract. CLASSIFIGATICN OF CONTRACTS 1. According to tholr relation to othor contracts a. Pruparatory =. preiminary step towards the celebration of another subsequent contizct . Principai ~ can. subsist Independenty ‘rom other contracts Accassory ~ can exist only as a consequence of, or in. relation with, another prior cortract 2. According to thelr perfeation a, Consensual = perfacied by mere preement of the pats b, Real requires consant of the parties end delivery of the-objact for thelr perfection Accurding to thelr form @ Common oF informal requires no ‘Particular form b. ‘Special. or formal requires some particular wn San Bova College of ZawSan Beda Loilege ot Law 8, According to tol vnames or norms regulating them’ « Nomivale = have "thelr own Individuality; regulated by spacial provisions of few b. innominate = lack individuatity, ant regulated by special provisions of law Kinds of Inncuninate Contracts: 8, Doutdos- tive that yeu give b. Dot faving «| give that you do ©. Facio ut dss» ido that you give 6. Facto ut facias do that you do Note: inniomirate contracts shall bo regulated by (1) the wtiputations of the panies, (2) the general pirovislons of the Givil Cods on obligations and contracts, (2) 136 rites yovoiniag the most anelogcis nominate contracte ‘and (4) the customs of the place (it 1307), According to. s9me authorliles co ut dos Is no onjer an innominate contract. tt has already baer, given a name of it svn, xe, barter or exchange (Articlo 1630). AUTO-CONTRACT Made by one person, acting in the name of nother In one capacity and In his own namin fo that of a different person in anotiier capacky COLLECTIVE CONTRACTS “Those where the law aithorlzes the wit of the majority to bind a miterily fo an agreement olwithstanding the- of position of tne fatter when: ali have a conimon Interest in the Juridleal act. | CONTRACTS OF ADHESION i. Contracts in which ine. of she parties inposrs a ready mavie form of contract, which the othar party mia) gocent ot Fej@st, but which the latter cannot modify. (PCIB V3iCA, G.R. No. 9785 March 28, 1996). © 's../ CHARACTERISTICS (omar) Obligatory force of eamiracts 2 Mutotty 3. Autonomy OBLIGATORY FORGE OF CONTRACTS, © This principle Is aislicity recognized in Arts. 1159, 1308, 15°8, and 1366. + It ls a rule that once the contract is perfected, it shall e of obligatory force ‘upon both ofthe coviracting partes. MAUTUALITY (Art, 1303) The contract must bind nth parties Note: The valicity or fulllinent of a contract cannot be lett to the wil of one of the controcting parties, \Vniiety oF fulfilment may be teft to (t) the will ofa third person, whose decision shall not be binding until mace knavm to both the contracting parties (Art, 4309) of (2) ¢ vance AUTONOMY (Art. 1506) The contiacting. partiae may ‘establish such stipulations, clauses, torns and conditions na ‘hey deem conveniont Limitatton io the peincipte of autonomy: Stipulations shout not 68 vonirary to law, morals, good cutétoms, public order, of public policy. RELATIVITY (Art, 1311) Coneral rule: Contrade take effect oniy between parting, ineir assigns and heirs. HOWEVER with venpect to assignees or heirs, the general ula unde Ait. 1311 1s not applcabie if the righis and obligations arising from the contract are net transm'ssible- or furely parsons Exceptions: 1, Beneficial Stipulaticn’ Stipulation pour sultul; snot “fpyor of 2 third et Di eh a7 MEMORY AIO IN CIVIL LAW] $47148 |2009 CENTRALIZED BAR GPERATIONS Test of Boneticial Suputation: Must be the purpusa and Jatont of the parias to Benefit the third person. Whather or not tha parties deliberately Inserted terms in thelr agruament with the avowed purpose of conierring a favor ‘upon such ‘third persan (Uy Tam_v, Leonard, GR No, 6312, Marsh 29, 1915). 2 When the third person comes into possession of the object of a contract srealing reat rights (Art. 1312). 3. Where the aontract is entered into in orter {o defraud a creditor(art. 1313); Here, the craditar may 3k for ils rescission 4, Where the third parson induces a contracting party to violate his contract (Ait, 1314), ‘Such third percon cen he held liable for damages. Requisitas: &. the existenca of 4 vaild contract; 1b. knowledge on the part ofthe third person of the oxistence of the contract; and © Interference by third person without logal justification or excuso, CONSENSUALITY OF CONTRACTS (art 1315) Gonoral rule; Contracts are perfected by mere consent and from that moment, the partivs are bound to the {ulfiliment of what ‘as. been expressly stipulated and. to all Sonsequence3 which, according to thelr nature may be In Keaping with good faith, usage and law. Exception: Real. contracts (@.6., daposit, pledge and commodatum) ure not perfocted Until the delivery of the object of the obligation, 4, Gonsont % 2. Select 4. Cause CONSENT: conformity of the parties to the terms of the contract; the acceptance by the oferee of the offer made by’ tho other. Roquisites: 1, Must be manifested by the concurrence of the offer and acceptance (Arts, 1349- 1326); 2. Parties must possess the necessary ‘egel cupacity (Arts. 1327-1529): ond Tad 2__ Sati Beda College of Katy 3, Must be inteligant. fros, aponianzous, and twal (Arte, 1930-1346). ‘Offer: Unilateral proponits which one party makes to the othar for tig celebration of @ contract. ‘ Requtsites (DIC): 1. Remaist be definite, 2. It must be intentional, 3.” emust be complete, 1 Withdrawal of Offer: Ottaferaposal may be withdrawn so long @9 ta offeror has no knowledge of acceptziios by offeree (Matirosa, 5th E-L, Bk, 2, f. 373). Rule on Compiex offers 1, Offers are Interrelatid ~ contract is porfected if ail the offurs'ara accepted, 2. Offers are not intereiated ~ single accaptence of each affer resus in a Perfected contract uniags the offeror has ‘made It clecr that one Is dependent upon ‘the other and acceptance sof both is necessary. oe Acceptanco: Must be curtain oF definite and absolute in character, A qualified acceptance constitutes a counter-offer (Art, 1319), Kay be exprese ur implied (Art. 1820) Ampiltied Acceptance» i Under cortain croumsances, a mere ‘amplification on the offer must be understood ‘8 an azceptance of the erginal offer, plus a new offer which is yontalned In the JV, p, 452), pZexolalned Res the firstSan Beda College 0: Lew + Socond View (Tolentiio)! Aeseptence ney be revoked before: comes to the knowledge of the afferor, because in such case there is stil no meeting of the minds, since the revocation hus. cancnlled of nullified -the accepiancd which thereby coased to have any leyal effect, Note: The ofaror mey fix tha time, pirce, and manner of acceptanc, il of which musi be complied with (Art 1924). + An offer made through agent is accopted from the tims. oceplance le communicated io hin (Artlla 4322) + An offor becomes inaffectiva uzon the death, ol Int dillon, insanty oe insolvency of either pany before acceptance is comeyod (Ai. 1329). Thoorles that dotermivie the exact mu.noat of perfection when axceptance Is mada by letter or telegram: 1. Manifestation Thecl; ~ perfected trom the moment the accerance is declared or mace. -Adhered to by the (ore of Sommerce 2, Expedition Theory» perfected from ths moment the oifaree ‘transmits the notification of ace.) arco to tha offeror, 3. Reception Theoiy = perfected from the moment taat. the notification is. In the hands of the ufferor in auch a manner that he ean, under ordinary conditions, procure the knowledge of ts contents, even if he Is not able “actually 10° acquire sueh knowledge, 4, Cognition. Theory * perfected from the moment the acceptance comes to the knowledge of the offeror. -Adhared ‘0 by the Glvil Code, Note: The stiautation of the patties governs the manner and moment of acceptance as when they stipulate that it bs eipressly accepted. Silence can be construe { 26 consent, ‘1 There je 9 duty oF peseliy foxpro: onesalf; 2. The manifestation, of the will carnot 8 Interpreted In eny ater way; 3. There Is a cleer Kierstity in the effect of te silence and the Undisviosed will (Articles 1670, 1870 to 1878). « Option contract: A preparatory contract in which one party grants t3 the other, for a fixed period and under specified conditions, to decide whether or not fo entar Into @ principal contract. Requisites: 4. Mt is supported ty an Independent consideration, art 2. Nis exclusive Othonwise, the offeror can withdraw his offer anytime, : Businoss advartisomonts (Art. 13251 ‘Thay arc more invitations to make an offer, and NOT definite offers, unioss it appears otherwise Advortisoment far bidders (Art, 1328) ‘t fs simoly an inettztlon to meke proposals. The advertiser in not bound to accept the highest or lowest bidder, unless It appears otherwise, Note: In judictal ‘sates, the highest ld must necessarily bo accepted Persons incapacitated to glvo consent (Art. 1327) 4. Minors EXGEPTIONS: a, When minor mis-epresents his age. (it imust bo an active "not. meroly ‘constructive roprasemtaton b Contracts involing the sele and delivery of necersarias to minors ©. Contracts by guardiens. or legal representatives, 2. Insane or demented gersons, unless the ote 1329) eS con 149 MMEMUNY AND IN CIVIL LAW] 149150 |2009 CENTRALIZED BAR OPERATIONS [2.~“Dased” ~ upon{2, Based upon publi| subjective policy and moralty circumstances of in persons 3. Voldable Fee Vicos of consent (Art, 4390): (VIMFU) 4. Violence 2. Intimidation Mistake 3. 4. Froud 5. Undue intiuence |, Mistake: it must refer to the substance of the thing which. is the object of the ‘contract, oF to those conditions wiich have Hrincipally moved one or both parties (0 ‘enter into the contraet (Art. 191). Not any wrung conception of tho thing but also the lack of knowledge with respect (o It (Manresa), ‘Two General Kinds of Mistake: One contracting parties/arrive at an erronecus| believe that a fact/conclusion — regarding| ‘exists when in reality i/the Interpretation of a’ does not or vice /quesilon of law or legal |varea. Jefects of a certain act) or transect ‘ Vilates consent | Iconsant except when it involves. mutual error to the effect of an lagreement when the iraal_ purpose is frustrated, Raquistos of Ast, 1994 whioh will vitiato consont: 1, Mistake must be with respect to the legal offect of aa agroament; must be mutual; and Partles’ teal purpose: must Nave been frustrated, 3 clo: Thote is no mistake If tho party alleging itknew the doubt, contingenoy or ik affecting the object of the contract (Article 13:33). 1. Violence: whea in ofder to wrest consent, serious or irresistible force is employed (Art. 1338) “So “¥ foi CEG OF LAW § San Jirda College of Lato Requisitas of Violénce: 4, Must Lo serious or inesisible 2° Must be the detuntiairg cause for the party upon whom Iti; employed in ‘entering into the conan Hy H Intimidation: whan gj 2f the eontsutlng pertia js compelled byin reasonable and well-grounded fear yl “an Imminent and grave avi! upon his persce of property, oF ‘pon the parson of prapey of his epouse, descendents or ascandente, to give his consent 4, 1398), | Requstes of ntti: Gre patty is compalied te give his consent by @ reasonable and wolkgrounded fear of an evil, The evil must be: i 8, Invminent and grave; bo Unjust; and ©. The datermining cause for the pany ‘upon whom Its empoyed in entering inte the contract. = WV. Undue Influence: wher. 2 person takes lunproper advantage of hs power over the wil of another, deprivin: the latter of @ Toasnnable freecom of ctuice (Art. 1337). Test of unxive influence: Whether of not the influence exorted has 80 ‘overpowered or subjugated the mind of a ‘contracting pity as to destroy his free agency, making him express the will of another rather than his own (Coso v, Femeider Deza, GR No, 18763, Dacembor 22, 1921). sit out ip abthAot haveSom Bios College o/ ate 7 4. It must have beer’ employed by 078 contracting party Ipoh the other and not 1 erplayed by both cntracting partes or by ‘hied person: 6. Damage or hijury, resulted tothe other party. a nw MEMORY AID IN CIVIL UAW] 152 Two jauictat acts in simulated contracts Ostensible Act (Apparent or Fictitious) ~ pretended continct Hidden Act (Real) - rue, egreement OBJECT: the thing, right or service which Is tie subject matter of the, obligation arising Dolo Causante nd Dolo tnoidenta Pern Td ALE ean ToMed ary ec ORT 1. Fraud which z serous in character’ a /2. Itis the cause whict |Z. ft Is not the cause: . induces the party (c|that induced toe pay! enter into a canract lt enter into u contract 3. Renders. the!S, Renders the pariy| [contract voldable___llable for damages Note: Faure to dick facts, whe there is 2 duty to reveal them censthutes fraud (Art from the contract. cei ‘Must be within the Commmereé of man, Should be resi or possible; Shovld be leit; and Should be determinate, "or at least poseibfa of determirstion as to its Kind, ‘The genus or bind of the object must be expressed, Things which cannot be the object of contracts (Art. 1347-1349): ‘Seneral rule: All thins or services may be the object of contracts, 4939). Exceptions: ©The ustal exagge: ation In rads, when the 1. Things outalde the commerce of men; other perty had an opportunity to know the 2. intraramissiole rights; facts, ure not Ie themselves frauduient 3. Future innertanee, except In cases (at. 1349). 6xpressly authorized by law; Requisites: + mere expression of an oplaion does not signify fraud unvess made by an cxpet and tho other party relled on the formers special knowledge (Art, 1241) * Fraud by third parson,does not viiate consent unless: - @. It has created substantial mistake and the same is int tual, 4 b, Third person. makes the misrepresentat'on vith the complicity, 5 ‘or at least with the knowledgy but without the otjection, of the favored contracting party. ‘+ Misrepresentation niade In good fatth Is net fraudulent but may constitute ertor (Art 1343). ; Simulation of contracts (Arts, 134541240) Kinds of simulation of éontract. 4. Absolute: partis, do mot intend to be bound by the contract et all, Thus, an absolutely simulat4 contract ls VOID. 2. Relative -parties, conceal “thelr. true agraemont. itbinds the partias to their real agreement, whet! {t.does nat prejudice a third person ond lt tot Intended fer any pumpose contrary to law, morels, good customs, public ordér of public policy. 3, The successlos has not yet bee opened ', The object of tio contract forms pait of the inheritance, and ¢, The prumissor hae an expectancy of a fight whieh le purely hereditary in nature. Services contraty to law, morels, good bead pvbiic. onde or public pelicy;, BAN nen DA futureHl 3 152 |2009 CENTRALIZED BAR OPERATIONS + foi Heeos Collegeof ato CAUSE: itis the Immediate, cirect or most tho causa 's 7 proximate reason which explaine and justiios contrary’ 9 : the creation of ablgation throught the wil of tre | Tow, moras, contracting partes, '2, Mlogalty off gad the contract Is jeause ‘customs, Jrull and void, Esuontial requisites of cause: public order 1, Should be in axistence at the time of the 5nd publa celebration of the contract poly « 2. Should be tet or awtul; act at rac I 3 Should be true, | val ift should aus. and Motive Distinguish la. rassty off sisted out [the ney Wace ‘ i ‘cause that cauva Is [founded upon| 1. Gkect end moet{t, inaract_ or remot nottue — :Jannther cause! {proxinate reason of alreason lwhich 1s. true| contract ___ Jandtavtut la: Objective arjuddleal|2. Psychological or] shal. nal ofa puroly personal reason| + Mvalldate the 3, Always the same for|3. Olffara for “each) | eeme a feach contracting party contracting party —_| [unless all 4. it legaltyhiiegality|4, is logality/ 4oae not ‘mistake of loffacts tne existence|atect the axlstence or| [4+ Leslors or) undue lor validity of the| validity of contract Inadenuacy of Influence; of! ont ee {). when the f 1 parties Nolo: Motive becomes causa wnen it ‘intended —_a| predetermines the purpose of tne contract donation of (trade p. 453). soma other leontract Mora} obligation as cause: See eee eee eee + Where the moral obligation arises wholly Prosumption of lawful cause from ethical considerations, unconnected Whon ihe cause is noy stated, tt stall be with any civil obligations, it cannot presumed to be in existence and lawful uniess: constiute a sulicient cause or Posto becotaryis hon i 164 consideration to support un onerous contract (Fisher v, Robb, GR No.L46274, Novamber 2, 1929). + Where such moral obligation is based pon a previous civil obligation which has already been barred by the statule of limitations at the time when the contract is eniered Into,: it constituies a sufficient cause of consideration to -support a contract (Villaroal yi Estrada, GR. No. 47362 Diclembre 19, 1949), it is then already a natural obligution, oct of luck of caus, untavful cause and fala9 cause (Arta, 1952-1254) there. is. a lth — cuntract total lack or |eonters. ro] absence’ of jright andi cause produces | egal effoct 4. Lack lcause of = eeeHn Bera Colles ef ato CONTRACTS WHICH -MUBT APPEAR It WRITING: ee 4. Donation of personal. ‘property whose vaiue excoeds five hundred pesos (Ar 748); 2. Sale of piesa of land or ary interest therein throughs an agent (Art 1874); 3. Agreoments re¢ arding payinert of interes! Incontracts of Kian (Art, 1966); and 4, Antichresis (Ait 2134), CONTRACTS WHISH MUST APPEAR IN A PUBLIC DOCUMENT: 4. Donation of Itimovable propartice (Art 149); 2. Partaership w/ ore immovable property oF real rights are contributed to the common fund (Arts, 1971 and 1773), 3. Acts and: cont:rets which hove for weir object che creation, transriission, modification cr -extiiguishment of rea Hghts over Imicevable property, salen or real property of of an interest therein is governed by Adicles 1493, No. 2, and 4406 (Art. 1356, ne 1); 4, The cassion, rej-uiation oF renunciation uf hereditary righ's or of those of the conjugal partna-shyp of gains (Ar. 1958, 10. 2); 5. The power to adminisier pioperty, or any other power whlch has for ts object en act appearing or which should appear ina public documert, ar should prejudice a third person (Art 1368, no. 3): and 6. Tha cession of dations or rights proceeding front an Sct appearing In a public document (Art 4358, nv. 4), CONTRACTS WHICH = MUST BE REGISTERED 4. Chattel mortnages “Art, 2140) 2. Salertranster of Hire cattle (Catile Rogistration Act). Note: Arts. 4357-1360 donot’ require the execution of the Contract ether in a publicfrivate: “idesuirent.th arder = to validate/enforce It litt oAly to, thsivra etfcacy, so that after Its'exis ence-has boen icmitted, ‘the party bound me} ‘be compalled to evecute the necessary docunient.. + # Whare the cont wiot was rot reduced to the required fort," #stl valid and binding as far as ‘the! (antrseting parties are concemed,: “Ai. 1257-1368 presuppose fhnowtonce eta eid ad enforabie contract © When ‘ont of tha’ cortracting | parties Invokes Art, 1387, the effect is to place the existence of the 2ontras! In Issue, which must be resolved by the ordinary ruios of evidene «Actions to enmpsl the execution of the necessary dacument and action upon the contract may bo exerelsed simultaneously, unless it appeors that the former action ‘must pracerte the latter, PA £792 (E- COMMERCE ACT) provides that the formal raguiraimenty to. make cortracts efisctive as against third persons. and to establish tho ox'atence of a contract are deomed complied with provided that the electronic document is unaltered and can be authonticated us to be usable for fulure reference, omaay "by" mann of unin o ten Instrument 1s nce of construed 80 88 to ‘cares oF contotm to the real intention of the sarties when some error or mistake hae been ‘committed, The doctrine ia basest on Justice and equity. REQUISITES: 4. Meeting af the mninds of the parkes; 2, Their true intentlen Is not expressed in the: instrument; Faliure to express true Intention fa due to mistake, fraud, inequitable conduct or accident suid Clear and conyiicing” proof 01 mistake, eMoulation, fraud, ar 153 MEMORY AID IN CIVIL LAW) 1531.354 2009 CENTRALIZED BAR OPERATIONS INSTANCES WHEN THERE GAN BE NO REFORMATION (/rt. 1366): 1, Simple: dunationa Inter vivos wherein no condition is imposed; 2, Wil; 3, When the agreaniant is vold Note: + if_mistake, fraud, Inequilable conduct or ‘accident has praventer! a meeting of the minds of the parties, the proper remedy Is not raformation of the: Ingtrumant but annulment of the contract (Art, 1389). + When one of the partie has brought an action to enforce. the Instrumont, 10 Sonn Bieta Colteze of Zao subsequent seformation ran be atked (Principle of estoppel). ‘essential lelements or illegality lof consent [Defect Is caused by vies| Dete caused Injury! damage elther tojof term, jone of the paities or fo ajcapacity of oth partis| Inot cured by prescripion [2 Do riot, as @ general| Vaid end onforceablo| Valid and enforesabia| Cannot be enforced by al tule produce any legallunti annulled by effect lcompetunt court alunti rescinded by alproper axon In court lcompatent court L 3, Action for the|Action for annulment or[Action for _rescission|Corresparding acticn for declaration or nuiity orldefunse of annulablity|may prescribe recovery, if there was jinex'stence or defense| may prescribe fof nullity of inexlstence 'ioos net preseribe 4,” Not cured” by|Gured by prescription prescription 8, Cannot be rati ratified. | \Gan be rallied 6. Assalled . by. alAasalied only by ‘contracting ‘party and: aleontragting party |ihra person whosel =" Interest 1s. directly} d i 7, Assoled drecily orfAssalled diecly — or total or partial performance of ° the! lunentorceable contract lunder No, 1 “or 3 of lattice "1403" may! esate by| collaterally collaterallyContec which tre. vals, bul whlch ate dofective berauts of Injury or damayo to either of the cortracting pertles oF to thts persons, as @ cona quence of which it may be rescinded by means of @ propor action for rescission. Note: The action fer cannot be Institued ity fuffering damage ras no other legal means to cobtaln reparation f2r the sarve (Art. 1383). # Rescission shal be -only to the extent necessary to tover tha damages cau'sed (Art. 1988) + Rescission shsi not take piace whan the {hings which era the abject of the contrat ero legally 11 the potsusslon of thin! person wha cif at act in bad fain (Art 1985, par. 2); only by a party tothe | by party, 13. tho contract and by a <2. | third pereon, EThe only ground }2, There are” several fallure of a party, to | causes or grounds f~ ‘comply with what Is | reecisaion based on Incumbent upon hm. equity, ——_— 3, Courts hava} 3, Cour has no power grant an extensiot for | time for performance performarice provised |.of tne obligation so that there | is cause, 4. On reaprosal contracts ..may-. ibe ny Unilateral or tecloracol, may be feselndeg REQUISITES OF REBCISSION: 4, Contract nus: bo: tnecieeible “under Artvles 1384 rind 1902; 2. Perty asking ler testission must have ne ther legal mecne to obtain reparation tor the garage suifeted by him (Article 1989); 3. Person dertia’ding rescission must be able to return whatever he may be oblined to reatore if rexclnston fs granted, (Article 1368); discretionary powel {3 | to grant extension of | ist long as there is 5) MEMORY AID IN CIVILLAW] 155, 4, ‘Things which are tho object of the coniract raust_not have passed fegally to- thi possossion of w tid persen acting in good falth (Articfe 1385); and Action must be drought within four years: (Articia 1389). CONTRACTS THAT ARE RESCISSIBLE tots, 1984-19021 Those eninved nto by gua.dians where the ward suffers lesion of mera than % of the value of the things which are objects theraot; Those ugroud upon in representation of absentees, if the latter suffer lesion by snore thar: % of the value of the things hich are euject thereof; 3, Those undartaken in fraud of creditors when the falter cannot in any mariner claim what are du thei; 4. Those which refer to things under tigation it they nave: bean entered into by the defendant without thé knowledge and approvat of tha lilgants and the court; 5. All other contacts especially declared by law to be subject to rescission; and 6, Payments made in 6 stato of Insolvency for obligation whose fulfliment the debtor could not be ccmpallad at the time they were effectus, Requisites botors a contract entered into In bohalf of wards ot absontees may’ bo rescindad on the giound of LESIC? 4. Contiact was entared into by @ guardian Ir behalf of his ward” or by a. legal representative In bohalf of an absentes; ae i Into without judietat e the cpa ae islon of mora 155(-356, 12009 CENTRALIZED BAR OPERATIONS 3, Creditor cannot In any legal manner collect nis credit; and 4. Object of the contract must nnt be tegully In the posseasion of a third person wito did not actin bad faith. PRESUMPTION OF FRAUD (Art. 1387) When Allonation of Property Prosumod 18 Fraud of Croditoras 4. Allenation by gratuitous tite if the debtor has not reserved sufficient propery to pay all of his debts eanitracted belore alianation; 2. Allenation by onerous tive if made by a debtor agalnst whom soma judgment hes heen rendered in any inalenca or some ‘wtf attachment has been sued. Badgos of fraud: 4. The foct ¢F Inadequate or fictitious cause ‘or consideration of the conveyance; 2. ‘Transta¢ by 9 deblor after. sult has been bogur. and wha is pending agalnst hin, 3, Sale on credit by an Ingcivent debtor, 4, Buldence. of tage. lidebledness or complete insolvency 6. Transfer of all of neerly all of debtor's property by him, espacially when insolvent ‘or greaily embarrussed financially; 6. Transfer between father and son, where others of the above circumstances are present, Failure ‘of the verdes to take exclusive possession of all the property REQUISITES BEFORE 4 PAYMENT MADE BY INSOLVENT GAN BE RESCINDED: 1. Itwas made in a slate of Insolvency; ard 2. Obligation must'hava been one which *he debtor could’ not he compelled to pay at the tima such payront was eff acted. APPARENT CONFLICT BETWEEN ARTICLE 1382 AND ARTICLE 1198 [1] IF THE OBLIGATION 18 SUBJECT TO SUSPENSIVE PERIOD: + Under Article 1382, payment made by an insolvent is rasciesine. Under Article 1198 {1}, a dobtor can be compelled to pay by {na eracitor even befo.e tha expiration of tne period since by his Insolvency he has already 10>t his right ta the benefit ef such period. + The confict can exsily be resolved by Geraldering the pony of dates between the two dabis, if the ebligetion with @ period became due waforw iF obligauicn San Bina College of Law to the creditor seeking: the “rescission became dua, then ta latter cannot rescitd the payment even if such payment ‘was effected before the/expiralion of the period; but I the obligation wilh @ period berame due afer the obigation fo the creditor seeking roscissian became due, then the latter can rescnd the payment Manresa} y EFFECT OF RESCISSION (Art. 1385) 1. As to the partlos ~ mutual restitution together withthe frults ad Interest, Note: this is applicable only to rescissory actions on the ground of eslon.and-nat to rescissory actions on the ground of fraud, 2, Asto third porson «Bad faith or not jegeily in possession — obliged to retuin + Legally in possessiii and not in bad folth “~ no raseiésion; however, Indemnity for senages may be demanded from th) person causing the toss % PRESCRIPTIVE | PERIOD; ACTION FOR RESCISSION (Art. 130017" 4. under Art, 1381 no. 1 =vithln 4 years from the time of: the terninatcn of the Ingopactty of the ward = 2. under Art. 1301 no; =within 4 years fom ihe tine the domiciie‘of the. ebsentes is known 3. under Art. 1381 nos, 3 and 4 as well as FAA. 1392 = within 4 years from the time of the discovery of fraud 4. In certain contracts of sal declared vitiated by ‘undueSun Bene College 3 Law MODES TO EXTINGUISH AN ACTION FOR ANNULMENT: 4, Preseripllon, S.C 2, Ratification; and § 3, Loss of the thing) Which is the otject of th contract through fraud or faut of the person who Is ented to institule the action, PRESCRIPTIVE FuRIOD: ACTION FOI ANNULMENT (Art, 1391): 4. Contacts entered Isto by Incapaciintad person’ = within 4 years’ from the time guardionship cea s 2. Where consent Is viiated by violenes, Intimidation or urdiie Infuerce — within 4 years from the.time such vioierice, Intimidation or vs1due influence ceat 3, Where consent '0 vltinted by miletake or fraud ~_within 4 yeaa ism tha time of tha discovery of suc) mistake or fraud Note: These periods apity only to the parties to the contact and 7:t to third persons, «© Discovary of frasi4 must be reckoned fom the time the dosument was registered In the offies of ihe fegiste of deeds. Registretion cainvtitutes_conétructive notice to the who-e world (Carantos v. CA, GR Ne..-33960, pr! 2, 1977), RATIFICATION (Arts, 1302-1390): The act or means by sirluo of which efficacy iy siven to a contract 4} ich suffer from a vice of curable nutty, + This may esti guish the action for annulaent oft voldabie- contract, Gleanves the cor-bact of ite defects trom the moment wes eomotituted, Requisites of retifice tens! 4, Contract Is tainte-l with a vice suscsptibe of being cured: ov 2. Confirmation Is ‘otfecled by the person who is entiled to do so under the law 3, Ils affected with knowledge of the vice or defect of he contrack and 4, Cause of the nullky of defect have akoady diseppeared Note: The right to retify: may be transmitted to the helrs of the party. entled 1o such right may likewise be exersised by the guariun of the Incapacttated. person’ having such sight (Artclo 1394). WHO MAY INSTITUTE ACTION FOR ANNULMENT (Art. £29 Genaral rule: Action or annulment may be stituted by all who are thermby obliged Princlpally or subsiclaniy: A stranger to the ontract cannet Instiite an action for annulment Exception: If a third person is prejudiced tn his right: with respect to one of the contracting parties, atid car aliow vebiment wile would positively result to hint from the contract In whch Ne has va; intervention (Teves. v, Peoplu's Homasito & Yousing Corp., GR No, 21498, Juno 27, 1968) " Fffecis of annulment: 4, Hf contract has not yet baen consummated = parties shell te roleased from the ‘obligations arising therefrom; 2, ifeontract has slready been consummated rules provided In Arts, 1390-1402 shalt govern, Eftucts of annulnunt in casos | of consummated voldible contrast (Arts, 1398-198) Obligation of Mutual Restitution: 4. Obligation to give = The parties shall restcre to each oer things which have been subject matter of contract with fruits ‘and the price with iterost, except in casts provided by tan. 2. Obligation 10. do e* not to do —Thare will have to be an apportionment of damages ‘aged 01 tho value of such prestaticn with corresponding Interasis. 3, When the dofect ofthe contract consists in bey BawyBialtercantracting part OEE SIRE folie maketieaiiuton exeaitiNeafar as held 2 bean BeAuhfod? Hyzthe ting op GBR Cerelned by OTE CHT LAY 1 is tie 4 iE Week 2. MT tha action for mramendkah etpish {MEMORY AID IN CIVILLAW| 357.158 [2009 CENTRALIZED BAR OPERATIONS 3, Duo (o fault of the incapacitated ~ whether the loss occurred during the plaintiff's Incapacity or after he had acquired capacity, the action for annuinient would ati be extinguished in accordance with Att, 1401, par, 4, Pug to fortuitous event = gontrect can stil ‘oe annuiled,. but tha’ defendant can be held llable only for the value of the thing at the time of Inss without intel est thereon. ‘Those which cannot be enforced by proper eatlon In court. unless they. are, ratified, because, either: ‘1, they are entered inte. without oF in excess of authority; 2 they do not comply with: the statute .of frauds; 3, both contracting panies do not possess the required legal capacity, STATUTE OF FRAUDS (Art. 1409, no. 2): Inthe following cases, an agreement hereafter mada shall be unenforceable by action, UNLESS the same, or voma note of meaorandur thereof, be in witixy, and cilbod by the party charges, or by his t; evidence thereof, of the agreement cannot be received without the wrling, or @ secondary evidence of ita contents 8. An agreement that by ts terms ie not to be Ferformed. within ona year trom the ‘making thereof, b. A special promise to enswer for the debt, ‘Gefauit or miscariege of ar.other; «This does not refer to the original or Independent promise of the vettor to his “own creditor, It refers to a collateral promis © An agreement in consideration of ‘marriage, other than & mutual promise to macry: 4. An agreement for the sale of goods, chattels or things in action, #t a price not less than 600 pesoy, unless ina buyer accepted. and received. such goods and chatels of evidences or some of them, of such things fi action or pay at the time some part of the purchase mouey; but ‘wiion a sate fs mada by auction end entry ls made by the auctioneer in his. sales book, at the time of gals, of the amount and kind of property sold, terms, price nanies of the purchasers and perscns to ‘whose account the sale Is made, It Is a sufficient memorandum, “er + Saw Feist College of Lain @ An agreement for leasiie! for a longer period than one year; or far the sale of real property or Iniorest uierola and f, Arepresentation aa to the credit of a third person, Note: The stotute of frauds ipiplies only to « EXECUTORY CONTRACTS, net to those that are partlally or completely fuflled. RATIFICATION OF CONTRACTS INFRINGING THE STATUTE OF FRAUDS (Art, 1406): ‘Such contracis may be ratified : 4, Failure to object to tive presentation of orai evidence to prove such contracts; or 2. Accoptance of benefits ‘under these ~ contracts Note: ‘The unenfercuablity of'a'éontract ean ony be assaied by parties thoreto. (Article 1408), Thi defense la personal fo the party to tne agreement, In coner, they are thou wich lack atsciutely either in fact or in aw one or some ‘of tha elements ossential for its valsity. Note: The defense of ilegallly of contract Is not avaliable te third porsons whose interests ‘are not directly affected (Art, 1421), + Accontract which Is the liect result of provicus illegal contract, is also vole and inalatont (rt 1422). 0:Lean Beds Colles ol Late CONTRACTS WHICH ARE INEXIGTENT | ‘AND VOID AB INITIO (Art, 1401 : 4. Those whose :2usa, object or purpose is contrary to lax, morals, geod customs, public order or ubite pollcy; 2, Those which in@ absolutely simutoted or - fletticus; 3, Those whose tuna oF object did rot exist atthe me of ts transaction; 4, Thosn whose cbjact Is outside the commerce of fx; 5 Those whieh comempiate an Impossible service; 6. Those where the Intention of the perties relatlve to the principal object of the contract cannct 26 ascertained; and 7. Those expressly prohibited or deciared vold by 'ave. PRINCIPL® OF IY" PARI 1441-1418): Gonorat rule: When the defect of a vole contract consists it, the illegality of the cause cor object of the conitaci and both of the parties are at fault or in psrf delta, the Iaw refuses | them every remedy end leaves them wrere they are, BLICTO (Arts. Exceptions: Payment of usurious interast (Art, 1412) 2 Payment ct merey or Gelvey of property for an ilegal pu 31036, where the party who paid or dalivered repudiates the contrac before the . purpose has heen accomplished, o* before any damnigd has been caused to u third persun (Art. 1414); Payment of norev or dellver’ of property mace by an ineapacttated person (Ar. 1418); 4, Agreement or siantract not ileaal per se but merely prohibited by law, and Ine prohibklon is duslened tor tha plaints protection (Art, 1416); 8, Payment of any ammount tn excess of the maximum pris of any arllole or! ‘commocity fxeci by law (Art. 1417); ! 6, Contract wherey a laborer undercakes to ‘work longer thse the maxinum number of hours fixed by nv (4rd, 1498): 7. Soniract whercy: @ laborer accepts a wage lower thay the minimum wage fixed by law (Art, 144 8. In case of divsibid contracts, the Iegat terms may be enforced separately trom the legal ter Atco 1426); and 8. One who ‘lost In gambling besause of fraudulent schemes practiced on him. He Is allowed tc recover his losses jAut. 315, 3 (b),” REG) even” gambling’ is” a prohibited one, Note: The. princ!ple’of “in part dolicto ts applicable onty to void contracts and not {0 inexistentcostmacis’ Rules whon only one of the parties Is. at fault: 4. Executed Contravts = Guilty party Is barred trom recovering what he has given {0 the other party. by reason of the contract. Innocert parfy may demand for the retuir of whal he haegiven. 2, Executory Contracts ~:Nelther of the contracting parties can demand for the fulfliment of any. obligation from the contract nor may be compelled to compiy ‘with such obligation, Notaral Oblige ‘Those based on equi and natural law, which do not grant a right of actinn to enforce thelr performance, bur sftot voluntary fulfilment by the obligor, authorize the rotention of what has. been delivered or rendered by "eascn thereof (At. 1422). Note: The binding tle of-these obligations te in the conscience ot man, for under the law, thoy do not have the necestory efieac: to giva rise to an action. + In order that trare may be a natural bligetion thore must exist a juridical tle which Is not probitited by law and which in itself could give a cause of uction bul becatiss ches tS 2 mee Is. =e one or means of Hornig pt SEG tee A 159 MEMORY AID IN-CIVIL LAW 359160 [2009 CENTRALIZED BAR OPERATIONS, NATURAL OBLIGATION AND MORAL OBLIGATION DISTINGUISHED is aah ae MCL wee 1, There is a juridical No. ptileel tia betwoen the parties | whatsoever. lwhich Is ot '2, Veluntary fulfilment ‘ot such produces legallaf: such dows not leffects whichihe couriproduce | ery legal ‘wil recognize and|effect which the court ‘protect, lwir recognize and [protect. EXAMPLES OF NATURAL. OBLIGATIONS: 4. Performance atter the civi cbigation tas prescribed (Art 1424) 2, Reimbursement of a third poruon for a bt trat has preserved (Art. 1425); 3, Performance ator aciion 9 enforce lv ‘obligation has falled (Art. 1426); 4, Payment by holt of dobt exceeding value ‘f property inhorked (4rt 1429): and 5. Payment of legacy after will have "been decared void (Art. 1450). €atoppel ‘A condition or stats by vidue of which an axdmission or representation is. rendered onclisive upon the person making it end cennot be denied or disproved us against the Jrorsow relying therooa (Art 1431), , KINUS OF ESTOPPEL: 1. Estoppel in pals er by conduct 4. Zstoppel by silence bh, Estoppel by acceptance of benefits 2. Technical estoppel a. Estoppol by dead b. Estoppel by record , Estoppel by Judgment 3. Estoppel by lachos Lachos of “Stalo demands” Fallure of neglect,-for an unreasonable and naxplained length of ime, to do that which, by exercising - due diligence, cout oF should have been dona earliartt is negligence or omisslon to ussert'a righ« within reasonable timo, warranting @ presumption that the party enjitisd to assert it elther has abandoned it or declined. Too i __Go jes College of Lato Efoments of laches: 4, Conduct on part of thp tslendant, oF of one under wom he alas, giving rise to the slluation of which nunplalnt 's made find for which the carrpidint seeks @ romody, 2 Delay in asseiting the. “Spmplalnant’s riglts, the complalnan; “having ‘had kowlsdge or notice, of ine defendant's conduct and having bea, afforded an ‘opportunity 0 Insttute a 8:1 Lach: of knowiedge of notis9 on the past of the dofendant that the complalne would ‘acsert the right on which ie bases his euit; 4. Injure or prejudies to the dafondant in the event febet Is accorded to the complainant, or tne sult Is not held to be barred. Lachos and Praserl aa ae concsrned ih fect of delay '2. question of inequity|2. qusstion or matter] lof porritting the claim|of tine ~ to Ee enforced (atsony iag inequity [4 apploe atiaw | '6. net based on a fixed|é. based on a fixed! 1s. genearned with] tact of delay lime tiene