Notes: Obli Con

Art. 1156.
What is an obligation?
It is a juridical necessity to give, to do or not to do. It is a juridical necessity because
in case of non-compliance of the obligation, the courts of justice can be called upon by the
aggrieved party to enforce its fulfillment or, in default thereof, the economic value that it
represents. In short, a court action can be brought by the aggrieved party.
Elements of an obligation include;
(a) An active subject (creditor/obligee)
(b) Passive subject (debtor/obligor)
(c) Prestation
(d) Efficient cause or Juridical tie
What is the concept of Prestation
A prestation is an obligation; more specifically, it is the subject matter of the
obligation which may consist of giving, doing or not doing a certain act. The law speaks of
an obligation as a juridical necessity to comply with a prestation. It is a juridical necessity
because non-compliance can result in juridical or legal sanction.
Enumerate the different kinds of obligation
(1) As to sanction
a. Civil obligation Obligations which give the creditor a right under the law
to enforce their performance in courts of justice.
b. Natural obligation based on equity or natural law, do not grant a right
but in case of voluntarily by the debtor he may not recover what has been
delivered.
c. Moral obligation
(2) As to the subject matter
a. Real obligation obligation to give
b. Personal obligation obligation to do or not to do
(3) Affirmativeness and negativeness
a. Positive obligation the obligation to do
b. Negative obligation obligation not to do
(4) As the persons obliged
a. Unilateral where only one party is bound
b. Bilateral where both parties are bound
i. Reciprocal Where the obligation or promise of the other is the
same obligation or promise of the consideration of the other party.
It is not adequate that both is indebted to each other. It should be
coming from the same cause or consideration.
The performance of one is conditioned to the simultaneous
performance of the other party.
ii. Non-reciprocal where performance by one is non-dependent on
the performance of the other.
Criticisms of the Definition by the Code
The definition is incomplete. This stresses merely the duty of the debtor without
emphasizing a corresponding right on the part of the debtor (the active subject). A more
complete definition is that:
An obligation is a juridical relation whereby a person (creditor) may demand from another
(debtor) the observance of a determinative conduct (prestation) and in case of breach, can
demand satisfaction from the assets of the latter.
Art. 1157.
Obligations arise from?
(a) Law;
(b) Contract;
(c) Quasi-contract;
(d) Crimes and actions punished by law (delict); and

(e) Quasi- delict (Torts)

Criticisms or comment(s) of the enumeration?
There are only two sources of obligation which are laws and contracts, because quasicontracts, delicts, and torts are really enforced by the law.

Art. 1158
Obligations derived from law are not presumed. This merely means that the
obligation must be clearly (expressly or impliedly) set forth in the law.
If regarding an obligation ex lege, there is a conflict between the New Civil Code and
a special law, the latter prevails unless the contrary has been expressly stipulated in
the New Civil Code.
Art. 1159
While obligations arising from a contract have the force of law between the parties,
this does not mean that the law is inferior to contracts. This is because before a
contract can be enforced, it must first be valid, and it cannot be valid if it is against
the law. The contracting parties may establish such stipulations, clauses, terms and
conditions as they may deem convenient, provided, they are not contrary to law,
morals, good customs, public order, or public policy.
Compliance in Good Faith
Neither party may unilaterally and upon his own exclusive volition, escape his
obligations under the contract, unless the other party assented thereto, or unless
for causes sufficient in law and pronounced adequate by a competent tribunal.
Compliance in good faith means that we must interpret not by the letter that
killeth but by the spirit that giveth life.
Where the parties to a compromise agreement signed and executed the same
WILLINGLY and VOLUNTARILY, they are BOUND by its terms, even if the COURT
before which it was made had NO jurisdiction over the case. The right to enter into
lawful contracts constitutes one of the liberties of the people of the State. In
contracts where public interest is involved (as in the case of labor agreements), the
government has a right to intervene for the protection of the whole.
Differences between an Obligation and a Contract
(1) An obligation is the result of a contract (or some other source). Hence,
while a contract, if valid, always results in obliga- tions, not all obligations
come from contracts.
(2) A contract always presupposes a meeting of the minds; this is not
necessarily true for all kinds of obligations.
The So-called Innominate Contracts
(a) Do ut des I give that you may give.
(b) Do ut facias I give that you may do.
(c) Facio ut des I do that you may give.
(d) Facio ut facias I do that you may do.
Art. 1160
A quasi-contract is that juridical relation resulting from a lawful, voluntary, and
unilateral act, and which has for its purpose the payment of indemnity to the end
that no one shall be unjustly enriched or benefited at the expense of another.
Negotiorum Gestio This takes place when a person voluntarily takes charge of
anothers abandoned business or property without the owners authority.
Reimbursement must be made to the gestor for necessary and useful expenses, as
a rule.

Solutio Indebiti This takes place when something is received when there is no right
to demand it, and it was unduly delivered thru mistake. The recipient has the duty
to return it.
Art. 1161
Obligations Ex Delicto or Ex Maleficio Governing rules
(a) Pertinent provisions of the Revised Penal Code and other penal laws,
subject to the provisions of Art. 2177, Civil Code.
(b) Chapter 2, Preliminary Title, on Human Relations (of the Civil Code).
(c) Title 18 of Book IV of the Civil Code on damages. Every person
criminally liable for a felony is also civilly liable. The reason lies in the fact
that oftentimes the commission of a crime causes not only moral evil but also
material damage. If no material damage is done, civil liability cannot be
enforced. The victim cannot recover damages in both cases (only in one).
Liability of an Insane Criminal An insane man who commits a crime is exempted
from criminal liability, but his guardian can be held civilly liable unless the latter was
diligent in his task of taking care of the insane. If there is no guardian, or if said
guardian (in the proper case) is insolvent, the property of the insane man can be
made liable. Subsidiary Liability Subsidiary liability of the parents in case of a minor
over 9 but under 15 who DID NOT act with discernment. If he acted WITH
discernment, he is criminally liable. The parents would be held liable unless they
can prove due supervision.
What Civil Liability Arising from a Crime Includes
(a) restitution;
(b) reparation of the damage caused;
(c) indemnification for consequential damages.
Effect of Death of the Criminal Offender Pending Trial Civil liability is not
extinguished for, after all, there can, in the case of physical injuries, still be an
independent civil action. The action will be directed against the administrator of the
estate, the obligation having become the obligation of the heirs; but of course the
liability cannot exceed the value of the inheritance.
Kind of Proof Needed
(a) If a civil action merely is instituted, mere preponderance of evidence is
sufficient.
(b) If a criminal case is brought (and with it, the civil case), the guilt must be
established by proof beyond reasonable doubt.
Effect of Acquittal in Criminal Case Suppose a defendant in a criminal case is
acquitted, can he still be held liable civilly?
(a) If the reason why there was an acquittal was because the accused could
not have committed the act, no civil action can later on be brought.
(b) If the reason for the acquittal was because of an exempting circumstance
(as in the case of an insane defendant), he would still be civilly liable (if he
has no guardian, or if the guardian who may under the circumstance be
ordinarily liable, is insolvent).
(c) If there is an independent civil action allowed by the law, civil liability may
still arise if this action is instituted and the defendants liability is proved by
mere preponderance of evidence (because while guilt beyond reasonable
doubt might not have been proved, it would be a simpler matter to prove
guilt by mere preponderance of evidence).
Example of Independent Civil Actions -Defamation (libel, slander) -Fraud (estafa,
deceit) and -Physical injuries (including attempted, frustrated, or consummated

homicide, murder, parricides or infanticide) --a civil action for damages, entirely
separate and distinct from the criminal action may be brought by the injured party
(or his heirs). Such civil action shall proceed independently of the criminal
prosecution, and shall require only a preponderance of evidence. Effect of
Reservation of the Civil Aspect Affidavit of Desistance Affidavits of desistance (such
as an express pardon in private crimes after the filing of the criminal case) do not
justify the dismissal of a criminal complaint.
Art. 1162
Obligations Ex Quasi-Delicts or Ex Quasi-Maleficio Governing laws
(a) Chapter 2, Title 17, Book IV, Civil Code
(b) SpecialLaws Definition of Quasi-Delict A quasi-delict is a fault or act of
negligence (or omission of care) which causes damages to another, there
being no pre- existing contractual relations between the parties.
What is Negligence?
Negligence is the failure to observe, for the protection of the interests of another
person, that degree of care, precaution, and vigilance which the circumstances
justly demand, whereby such other person suffers injury.
Test for Determination of Negligence
Would a prudent man (in his position) foresee harm to the person injured as a
reasonable consequence of the course about to be pursued? If so, the law imposes a
duty on the actor to refrain from that course, or to take precaution against its
mischievous results, and the failure to do so constitutes negligence. Reasonable
foresight of harm, followed by the ignoring of the admonition born of this provision,
is the constitute fact of negligence.
What are the Requirements Before a Person Can Be Held Liable for a Quasi-Delict
(a) there must be fault or negligence attributable to the person charged;
(b) there must be damage or injury;
(c) there must be a direct relation of cause and effect between the fault or
negligence on the one hand and the damage or injury on the other hand
(proximate cause).
1) Proximate cause is that adequate and efficient cause, which in the natural order
of events, necessarily pro- duces the damages or injury complained of.
2) There are instances when although there is damages, there is no legal injury or
wrong (damnum absque injuria damage without legal injury). (Example: If a
carefully-driven car causes damage to a pedestrian because the driver was
suddenly struck by lightning, this is an instance of damage without injury.)]
Chapter 2 NATURE AND EFFECT OF OBLIGATIONS
Art. 1163.
What is implied in an obligation to give or to deliver a determinate thing?
The first implication of an obligation to deliver a determinate thing is for the debtor to
take care of the thing with the diligence of a good father of a family, unless the law or the
stipulations of the party requires another standard of care.
What standard of care?
The diligence of a good father of a family, unless the law or the stipulations of the
party requires another standard of care.
What constitutes diligence of a good father of family?
That diligence which is required by the nature of the obligation and that which
corresponds to circumstances of person, place and time.
Another definition that standard of care any prudent man would observe/exercise
when taking care of his own property (Ordinary care)
Art. 1164.

What are the rights of the creditor to the thing to be delivered? (Same question: When does
the creditor acquire right to the thing to be delivered as well as to its fruits?)
When the obligation to deliver it arises, he has personal rights over the fruits of the
thing to be delivered and shall acquire a real right over the thing when it has been delivered
already.
When does the obligation to deliver a thing arise?
When there is no term or condition, from the perfection of the contract.
When there is a term or a condition, then when the term arrives or the condition
takes place.
Kinds of Delivery?
Actual and Constructive delivery. (refer to the book p113)
Art. 1165.
What are the remedies of the creditor in Real Obligation (Obligation to give or to deliver as
opposed Personal Obligation or Obligation to do or not to do. )
(1) In Specific Real Obligation to deliver a determinate thing.
a. Demand Fulfillment with indemnity for damages.
b. Rescission with indemnity for damages.
c. Demand Damages
(2) In a Generic Real Obligation to deliver a generic thing.
a. Performance by a third person at the expense of the debtor
Why?
In Specific Real Obligation, only the debtor can comply with the obligation hence the
law grants to the creditor the right to compel the debtor to make delivery.
In Generic Real Obligation, the obligation can be complied with by a third person
hence it is not necessary that the creditor compel the debtor to make delivery.
As a General Rule, loss of the object of the obligation in Specific Real Obligation by a
Fortuitous event extinguishes the obligation except when?
Par. 3: When the obligor delays (legal delay or default)
When the obligor is guilty of BAD FAITH for promising the thing to two or
more persons who do not have the same interest.
Difference between ordinary delay and default?
Former is merely non-performance at the stipulated time; latter is the nonperformance which amounts the virtual non-fulfillment of the obligation. (Demand should be
made, either judicial or extra, to put debtor in default)
Art. 1166
What does an obligation to give a determinate thing include?
It includes the delivery of all of its accessories and accessions, even though they may
not have been mentioned.
Difference bet. Accessories and accessions?
Former things which are included to the principal for the persons better use,
perfection, and enjoyment.
Latter are all additions or improvements upon the thing.
Why include the accessories and accessions?
It is based on the principle that the accessory follows the principal.
Art. 1167 (Personal obligation to do)
Remedies of the creditor if debtor fails to do?
If a person obliged to do fails to do it, the same shall be executed at his cost.
This same rule shall be observed if he does it in contravention to the tenor of the
obligation. Furthermore, it can be decreed that what has been POORLY DONE be undone (if
possible).
Why cant the debtor be compelled specific performance?
While in a specific real obligation, the debtor can be compelled to deliver, a specific
performance cannot be ordered because this would amount to involuntary servitude, which
is prohibited under the Constitution.
Art. 1168.

In negative personal obligations (obligation no to do) and the person does what is
forbidden of him, it shall be undone at his expense plus damages.
Art. 1169.
When does a person who is obliged to deliver something incur in delay?
A person who is obliged to deliver something incur in delay from the time the oblige
demands from him, judicially or extrajudicially, the fulfillment of his obligation.
When is demand not necessary to put obligor in delay?
(1) When the OBLIGATION or the LAW expressly so declares;
(2) When from the nature and circumstances of the obligation it should appear that
the determination of the time when the thing is to be delivered or a service to be
rendered is the controlling motive for the establishment of the obligation; and
(3) When demand would be useless, as when the obligor has rendered it beyond his
power to perform.
IN reciprocal obligations?
Neither party incurs in delay when the other does not comply or is not ready to
comply in a proper manner with what is incumbent of him. From the moment one of the
parties fulfills his obligation, default of the other begins.
Default or Mora define.
It is the failure to perform an obligation on time which failure constitute a breach of
the obligation.
(1) Mora Solvendi default on the part of the debtor.
a. Mora Solvendi ex re (debtors default in real obligation)
b. Mora Solvendi ex persona (debtors default in personal obligation)
(2) Mora Accipiendi (default on the part of the creditor)
(3) Compensatio Morae (When in a reciprocal obligation both parties are in default; it
is as if neither is in default)
What are the requisites of mora solvendi?
(1) Obligation must be due and demandable;
(2) There must be non-performance
(3) There is a demand, either judicially or extra-judicially, unless demand is not
required as stipulated or as enforced by law
(4) The demand must be for the obligation that is due
When an obligation is not extinguished by a fortuitous event?
When the debtor is in default.
When the debtor is guilty of BAD FAITH.
When the obligation to deliver a certain and determinate thing arises from a criminal
offense, unless the creditor is guilty of mora accipiendi.
How does default on the part of the debtor happen? (mora accipiendi)
When the creditor unjustifiably refuses to accept payment of specific performance at
the time it could be done.
Art. 1170.
What are the grounds of liability for damages in the performance of their obligation?
When obligor is guilty of:
(1) Fraud (dolo) intentional evasion of fulfillment
(2) Negligence the failure to observe for the protection of interests of another
person that degree of care and vigilance, in which such other person suffers
injury.
(3) Default
(4) Those who, in any manner, contravene the tenor thereof.
Should those who are liable under art. 1170 always pay damages?
No, in general, only when aside from the breach of contract, prejudice or damage was
caused.
Kinds of damages
(a) Moral damages
(b) Exemplary

(c) Nominal
(d) Temperate
(e) Liquidated
(f) Actual
Art. 1171.
Responsibility arising from fraud is demandable in ALL obligations. Any waiver of an action
for future fraud is void. explain
Responsibility arising from fraud is demandable in all obligations and unlike in the
case of a responsibility arising from negligence (1172), the courts cannot mitigate or reduce
the damages to be awarded (in other words, such liability cannot be regulated by the court).
This is so because fraud is deemed serious and evil that its employment to avoid the
fulfillment of an obligation should be discouraged.
According to the time of commission, fraud may be past or future. A waiver to
commit future fraud is deemed void because in such case, the obligation will be rendered
illusory since the obligor knows that even if he commits fraud, he will not be held liable.
Waiver of a past fraud, however, can be valid as maybe an act of generosity or
forgiveness on the part of the victim. Here, what is renounced is the effect of the fraud, the
right to indemnity for damages granted to the victim.
According to meaning, fraud may be classified into:
(1) Fraud in obtaining consent
(2) Fraud in performing a contract
a. Dolo causante use of clever words and other strategies to induce another
party to enter into a contract, without which the party would not have
agreed to.
b. Dolo incidente even without which, the other party would still enter into
the contract thus the fraud is only incidental.
Art. 1173.
Difference between responsibilities arising from fraud to that arising from negligence?
Responsibility arising from negligence is also demandable with respect to all
obligations, but unlike in fraud, such liability can be regulated by the court depending on the
circumstances.
The courts may increase or decrease the liability of the negligent depending on the
circumstances.
Why do you think this is the case?
Fraud is a serious act of malice or evil with the deliberate intent to cause harm or
damage, unlike in case of negligence. Thus where negligence shows BAD FAITH (deliberate
commitment), it is considered to be equivalent to FRAUD.
Differences between DOLO and CULPA
(1) Intent although both are voluntary acts, INTENT to cause damage is present in
dolo and not in culpa
(2) Liability liability arising from dolo cannot be mitigated by the court, but that
which arise from culpa can either be reduced or increased
(3) Waiver of the liability liability for future fraud is void, but liability for future
negligence can in some cases be granted.
Note: Gross negligence can never be excused in advance.
(Contracts of Adhesion the terms and conditions of the contract is set by one party
with which the other party has little or no ability to ask for a more favorable term.)
Stipulations on negligence must be strictly construed against the party situated in higher or
more advantageous position.
Furthermore, a contract of adhesion is not a one-sided document as long as the other
party is not prevented from studying it.
CULPA CONTRACTUAL
CULPA AQUILIANA
CULPA CRIMINAL
Negligence is merely
Negligence is
Negligence is
incidental
substantive
substantive
With pre-existing
No pre-existing
No pre-existing

contractual relations
Proof needed mere
preponderance of evidence
Defense of a good father of
a family in the selection
and supervision of
employees is not a proper
defense but this may
MITIGATE damages
Burden of proof is in the
debtor that no negligence
in carrying out the terms of
the contract
Respondeat Superior:
negligence of the servant,
negligence of the master

contractual relation
Preponderance of evidence
This is proper defense
insofar as employers or
guardians are concerned

Burden of proof is on the

victim on the alleged
negligence of the defendant
(prove that defendant is
negligent)
Rule of a Good Father of a
Family; negligence on the
part of the guarding/owner
is presumptive. Negligence
of the servant, separate
from negligence of the
master

contractual relation
Proof beyond reasonable
doubt
This is not a proper defense.
Employees guilt is
automatically the
employers CIVIL guilt, if the
former is INVSOLVENT.
Accused is presumed
innocent until proven
otherwise and the burden of
proof is in the prosecution
Automatic subsidiary
liability when servant is
found guilty and insolvent.

In culpa contractual, all the creditor has to do is to prove that there was a contract and that
there is a breach of contract, thus giving the presumption that the obligor was negligent. To
escape liability, it is the duty of the obligor to prove that he exercised due diligence in the
performance of his obligation.
Negligence on the part of the Victim
(a) If negligence was the IMMEDIATE and PROXIMATE cause of the injury, no recovery
(b) If negligence was only CONTRIBUTORY, damages may be granted but would be
mitigated by the court
Art. 1173.
What does negligence constitute?
It constitute the omission of the necessary diligence required by the nature of the
obligation and the circumstances of the persons, time and place. When negligence shows
BAD FAITH, the provisions of art. 1171 and 2201, paragraph 2, shall apply.
If the law or contract does not state the diligence that is required, that which is
expected of a good father of a family shall be required.
Negligence it is the omission of due diligence.
Kinds of Diligence under the Civil Code?
(1) Stipulation of the party
(2) Required by Law
(3) In the absence of either of the two, diligence of a good father of a family
Art. 1174.
Fortuitous Event?
It is an unforeseeable event, or although foreseen, is inevitable.
(According to art. 1174) As a general rule, no person shall be responsible in case of a loss
through a fortuitous event, except:
(1) When expressly specified by law
In addition:
a. Art. 1165 If the debtor incurs in delay or has promised the same to two
or more person who do not have the same interest, he shall be responsible
for fortuitous event until he has effected the delivery.
b. Furthermore, when the civil obligation arises from crimes committed, such
as the obligation to return what has been stolen, a fortuitous event shall

not excuse the criminal from the obligation unless the creditor is guilty of
mora accipiende.
c. When the object of the obligation is a generic thing.
(2) When it is stipulated in the contract
(3) When the nature of the obligation requires the assumption of risk
Essential Characteristics of Fortuitous Events
(1) It shall be independent of the will of the debtor (no PARTICIPATION OR
AGGRAVATION)
(2) It must be unforeseen, although foreseen, inevitable
(3) It must be such as to render it impossible to comply with the obligation
Art. 1175.
Usurious shall be governed by?
Ans. Special Laws
Usury is contracting for or receiving something in excess than that amount which is allowed
by law for the loan or use of money, goods, chattels and credits.
Types of interest:
Moratory interest
Compensatory interest
Art. 1176.
What is presumed when there is a receipt of the principal by the creditor?
When there is a receipt of the principal by the creditor, without reservation with
respect to the interest, it shall give rise to the presumption that said interests has already
been paid.
This is so because as stated by law, interests precede the payment of the principal.
A receipt of a later installment of a debt, without reservation with respect to
payments of prior installments, shall raise the presumption that such installments have
already been paid.
Is presumption here, conclusive?
No, is rebuttable presumption.
Art. 1177
Art 1177 speaks of the creditors having the right;
(1) To exact payment
(2) Pursue the leviable property of the debtor/ exhaust debtors properties
(3) (Accion Subrogatoria) After having pursued the property in possession of the
debtor, exercise all rights (right to redeem) and bring all the actions of the debtor
(the right to collect from the debtor of his debtor) except those inherent in the
person.
(4) (Accion Pauliana) Impugn or rescind acts or contracts done by the debtor to
defraud the creditors
Art. 1178.
Subject to the laws, all rights acquired in virtue of an obligation are transmissible, if there
has been no stipulation to the contrary.
(a) General Rule Rights are transmissible.
(b) Except:
a. If the law provides otherwise;
b. If the contract provides otherwise;
c. If the obligation is purely personal.
1182
Effects of potestative, casual, and mixed conditions on the obligation.
When the fulfillment of the obligation depends upon the sole of the DEBTOR and it is
also SUSPENSIVE, the conditional obligation shall be valid.
IF the condition is potestative on the part of the DEBTOR and it is RESOLUTORY, it
shall be valid.
If it is potestative on the part of the CREDITOR, it shall be valid.

It shall also be valid if it depends upon CHANCE, OR THE WILL OF A THIRD PERSON.
(1191-1203)
Art. 1191
Define:
(a) Reciprocal obligation
(b) Rescind
What is implied in reciprocal obligations?
The power to rescind obligations is implied in reciprocal ones, in case one of the
obligors should not comply with what is incumbent upon him.
In this case, what is the remedy of the injured party?
Choice between the fulfillment and rescission of the obligation, with the payment for
damages in either case. He may also ask rescission even after choosing fulfillment, if the
latter becomes impossible.
What arises when there is rescission of obligation?
Rescission abrogates the obligation from its inception and requires restitution of
benefits received (as if no contract has been made). Thus, it creates an obligation to return
the object of the contract and not merely to release parties from further obligation to each
other.
What are the characteristics of the right to rescind or resolve under this article?
(a) It exists only in reciprocal obligations
a. Exception: In a reciprocal obligation with a period. In which case, neither
party can demand performance or be considered in default before the
expiration of the period.
(b) It can only be demanded if the plaintif is ready, willing, and able to comply with
his own obligation, AND the other is not. Moreover, the guilty party cannot
rescind. (Why?)
(c) The right to rescind in NOT absolute. As to when there is only slight breach or
trivial causes.
(d) The right to rescind needs judicial approval in certain cases, and in others, does
not.
(e) The right to rescind is implied and therefore need not be stipulated upon.
(f) It may be waived, expressly or impliedly.
Note: The remedies are alternative and not conjunctive and if an action is brought for
specific performance, the damages sought must be asked in the same action; otherwise, the
damages are deemed waived.
Damages in a breach of contract of lease?
Depends:
In specific performance, he can demand the accrued rent plus the future rent for the
unexpired period.
In rescission, he gets only the back rents and ouster the lessee, plus damages, but
not
necessarily the future rents for the unexpired period.
Art. 1192
remedies?

In case both parties have committed a breach of the obligation, what are the

OBLIGATIONS WITH A PERIOD

Art. 1193.
When shall an obligation with a certain period be demandable?
Obligations for whose fulfillment a day certain has been fixed, shall only be
demandable when that day certain comes.
Obligations with a resolutory period take effect at once, but terminate upon the
arrival of the day certain.
Define Period

It is a certain length of time which determines the effectivity or extinguishment of

obligations.
Period distinguished from a condition
(a) (Certainty) In their fulfillment condition is an uncertain event; period is an event
which must necessarily come, at a date known beforehand, or a time which
cannot be determined.
(b) (Tense) With reference to time period ALWAYS refers to the future::condition
may refer to the past
(c) (Influence) As to influence on the obligation A condition causes an obligation to
arise or cease while a period merely fixes the time of the effectivity or the
efficaciousness of an obligation.
Different kinds of Terms or Periods
1) Definite and Indefinite
2) Legal, Conventional, and Judicial
3) Ex die and In diem
A day certain?
Is understood to be that which must necessarily come, although it may not be known
when.
Requisites of a period
1) It must be future.
2) It must be certain but can be extended.
3) It must be physically and legally possible.
Art. 1194 In case of the loss, deterioration, or improvement of the thing BEFORE the
arrival of the day certain?
Art. 1195 Payment or delivery made before the arrival of the period?
Anything paid or delivered before the arrival of the day certain, the obligor being
unaware of the period or believing that the obligation has become due and demandable,
may be recovered, with the fruits and interests.
To be able to recover?
1) Must have been unaware of the period; or
2) Must have believed that the obligation has become due and demandable.
Suppose there is premature performance on both sides, should there be restitution of what
has been received plus fruits and interests?
No, because:
1) Both parties implicitly agreed to the changing of the date specified when both
complied to their obligation.
2) The interests and fruits, in reciprocal obligations, are deemed to compensate each
other.
Within which period can recovery be made?
Before the debt matures as to what was paid.
Even after maturity with regards to the interests for after all the creditor was in BAD
FAITH.
Art. 1196
When in an obligation a term is designated, for whose benefit was it established?
It is presumed to have been established for the benefit of both the debtor and the
creditor. Unless from the tenor of the same or other circumstances, it should appear that the
term was established for the benefit of on or of the other.
It is presumed to be for the benefit of the debtor and creditor. This means that not
the debtor nor the creditor can comply with his obligation prematurely. (Debtor to pay
before the term and the creditor to demand payment before the term.)
Exception: (IF there be such intent)
(a) Term is for the benefit of the debtor alone.
(b) Term is for the benefit of the creditor alone.
When is it only to the benefit of the debtor?
(1) When there is no interest; and

(2) When payment is to be made within a certain period from the date of the
contract.
Art. 1197
When may the courts fix the period?
If the obligation does not fix a period, but from its nature and the circumstances it
can be inferred that a period was intended, the courts may fix the duration thereof.
The courts shall also fix the duration of the period when it depends on the will of the
debtor.
In every case the courts shall determine such period as may under the circumstances have
been probably contemplated by the parties. Once fixed by courts, the period cannot be
changed by them.
When the court fixes the term, does it modify or amend the obligation?
No, when the court fixes the term, it does NOT amend or modify the obligation. It
merely enforces or carries out an implied stipulation in the contract.
How do the courts fix the period?
The Court determine the period by considering the time probably contemplated by
the parties. (Art. 1197) Once the period has been fixed, it is considered to be part of the
contract therefore the court cannot change it.
After the fixing of the period by the court, can the parties change the period?
Yes, by mutual agreement, the parties can change the term or may even disregard
them in which case it becomes an obligation which does not depend on a future and
uncertain even, in other words, it becomes a pure obligation, and shall be due and
demandable at once.
Note: When the court fixes the period, it does not modify the obligation, but merely enforces
what is an implied stipulation in the contract, and once fixed by the court, it cannot be
changed by them (court).
Art. 1198
When shall the debtor lose every right to make use of the period?
Ans. State Art. 1198
What is the consequence when the debtor loses the benefit of the period?
The term is extinguished which means it becomes a pure obligation, and the
obligation becomes demandable at once.
ALTERNATIVE OBLIGATIONS
Art. 1199.
What is an alternative obligation?
A person alternatively bound by different prestations shall completely fulfill one of
them.
The creditor cannot be compelled to receive part of one and part of the other.
An alternative obligation is one where there are two or more prestations, and only one of
them is DUE.
Art. 1200
In an alternative obligation, to whom does the right of choice belong?
It belongs to the debtor, unless it has been expressly granted to the creditor.
And he shall have no right to choose those prestations which are:
(a) impossible,
(b) unlawful or
(c) which could not have been the object of the obligation.
In what way does an obligation with a term differ from an alternative obligation with
reference to
benefit.
As a general rule, in obligations with a term, the benefit is for both the debtor and the
creditor. In an alternative obligation, however, the general rule is that the debtor has the
right of choice.

Art. 1201 the choice shall produce no effect until it has been communicated (Orally or in
writing, expressly or impliedly).
Effect of notice that choice has been done?
Once the choice has been made it has been communicated, the obligation becomes a
simple obligation to do or to deliver. An election once made is binding to the one who makes
it, and he will not therefore, be permitted to renounce and take an alternative which was
first open to him.
Why is there a need to communicate?
The purpose of notice is to inform the creditor that the obligation is now a simple
one, no longer alternative, and if already due, for the creditor to receive the object being
delivered, if tender of the same has been made.
And in order for the creditor to make the necessary preparations for the acceptance
of the prestation.
Art. 1202
When does the debtor lose the right of choice?
It is when among the prestations whereby he is alternatively bound, only one is
practicable.
Art. 1203
Rule when the debtor cannot choose because of the creditors acts?
If the debtor cannot choose according to the terms of the contract, he MAY rescind
the contract with damages.
Art. 1204
When the right of choice is expressly given
Things are lost when right of choice
to the creditor?
belongs to the debtor:
When one of the things is lost
When all of the things which are
through a FORTUITOUS EVENT, he
alternatively the object of the obligation
shall perform the obligation by delivering
are lost through the fault of the
that which the creditor should choose from
debtor, the creditor shall have the right
among the remainder, or that which
to indemnity for damages.
remains if only one subsists.
Indemnity shall take as a basis, the
When one of the things is lost
value of the last thing which was lost or
through the fault of the debtor, the
the last service which has become
creditor may claim any of those subsisting,
impossible.
or the price of that which through the fault
Damages other than the value of the
of the debtor has disappeared, with
last thing or service may be granted.
indemnity for damages.
When all of the things are lost
through the fault of the debtor, the
choice of the creditor shall fall upon the
price of any one of them, with indemnity
for damages.
Art. 1205

Art. 1206
What is a facultative obligation?
It is when only one prestation has been agreed upon but the obligor may render
another in substitution.
The loss or deterioration of the thing intended as a substitute, through the negligence
of the obligor, does not render him liable. But once the substitution has been made, the
obligor is liable for the loss of the substitute on account of his DELAY, NEGLIGENCE, OR
FRAUD.
Before the substitution, why is it that the obligor is not liable for the loss or the deterioration
of the substitute?
This is because only the principal prestation is due and demandable. The obligor has
the absolute choice, thus he has all the rights in the world not to choose the substitute and
holding the obligor liable for the loss or deterioration thereof will destroy the character of a
facultative obligation.
Joint and Solidary
Art. 1207
Joint distinguished from Solidary Obligations
In the former, there is a concurrence of two or more creditors or two or more debtors
in one and the same obligation in which each of the latter only answers or obliges to a part
of the whole obligation and to each creditor belongs only a part of the correlative rights. The
latter gives the right to all of the creditor to demand from any one of the solidary debtors
and binds all of the debtor to comply with the whole obligation.
(a) Joint = to each his own
(b) Solidary = one for all, all for one
What is the presumption when there are two or more debtors and/or two or more creditors?
The obligation is presumed to be joint, except:
(a) Stipulation of the parties
(b) Nature of the obligation
(c) Law
Art. 1208
What is the presumption that obligation is Joint?
When there are two or more debtors and/or creditors, and the law, or the nature or
the wording of the obligation the contrary does not appear, the obligation is joint and as a
result:
(1) The obligation shall be divided into as may equal shares as there are creditors or
debtors.
(2) The credits and debts being considered as DISTINCT from each other.
Art. 1209
When in an indivisible joint obligation? How will the creditors rights be prejudiced?
In an Indivisible Joint Obligation, the rights of the creditors can only be prejudiced
through their collective acts. The obligation can only be enforced by proceeding against all
of the creditors. If one of the debtors is insolvent, his co-debtors shall not be held liable.
Art. 1210
Indivisibility does necessarily give rise to solidarity, nor solidarity imply Indivisibility.
What are different kinds of Solidarity?
(1) Passive, Active, and Mixed
(2) Conventional and Legal
Art. 1211
Can solidarity exist even when the creditors and debtors may not be bound by the same
periods and conditions?

Yes. There can be solidarity in a sense that once the period has arrived or the
conditions have been fulfilled, the creditor shall have the right to claim from any one of the
debtors those part of the obligation which is affected by the happening or arrival of the
condition/ period.
Art. 1212
Each one of the SOLIDARY CREDITORS may do whatever is beneficial to others but not
anything which may prejudice the rights of the latter.
Art. 1213
When can the creditor assign his rights to another person?
He cannot do so without the consent of the others. This is because of mutual
confidence and representation among the creditors.
Art. 1214
To whom does the debtor must pay?
He can pay to any one of the solidary creditors, but if someone made a judicial or
extrajudicial demand, payment shall be made to him.
CHAPTER 4
EXTINGUISHMENT OF OBLIGATION
GENERAL PROVISIONS
Art. 1231
How are obligations extinguished?
Ans. Obligations are extinguished:
(1) By payment or performance;
(2) By loss of the thing due;
(3) By condonation or remission of the debt;
(4) By confusion or merger of the rights of creditor and debtor;
(5) By compensation
(6) By novation.
Other causes of extinguishment of obligations, such as
(a) Annulment;
(b) Rescission;
(c) fulfillment of a resolutory condition; and
(d) prescription,
are governed elsewhere in this code.
Section 1
PAYMENT OR PERFORMANCE
Art. 1232
Define payment.
Ans. Payment means not only the delivery of money but also the performance, in any
manner of an obligation.
Art. 1233