CHAPTER 3 Different Kinds of Obligations

SECTION 2 OBLIGATIONS WITH A PERIOD

Article 1193. Obligations for whose fulfillment a day
certain has been fixed, shall be demandable only
when that day comes.
Obligations with a resolutory period take effect at
once, but terminate upon arrival of the day certain.
A day certain is understood to be that which must
necessarily come, although it may not be known
when.
If the uncertainty consists in whether the day will
come or not, the obligation is conditional, and it
shall be regulated by the rules of the preceding
Section. (1125a)
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OBLIGATIONS WITH A PERIOD
DEFINITION: TERM OR PERIOD
- a ceratin length of time
- which determines the effectivity or the extinguishment
of obligations.
DEFINITION: TERM OR PERIOD
- consists in a space of time
- which has an influence on obligations
- as a result of a judicial act
- and either
- suspends their demandableness, or
- produces their extinguishment. . . (Manresa,
Commentaries on the Civil Code, Vol. 8, p.
153).
DEFINITION: Obligations with a period
- are, therefore, those whose consequences
- are subjected in one way or another
- to the expiration of said term.” (Manresa,
Commentaries on the Civil Code, Vol. 8, p. 153).
TRUE OR FALSE: In obligations with a term, the obligation arises
upon the arrival of the period.
FALSE. The obligation is existing, only its performance or
demandability is postponed by the period.

PERIOD EX DIE (SUSPENSIVE EFFECT)

JURADO: According to the first and second paragraphs of Art.
1193, a period may be suspensive (ex die) or resolutory (in
PERIOD IN DIEM (RESOLUTORY EFFECT) diem).

DEFINITION: PERIOD EX DIE (SUSPENSIVE EFFECT)

OBLIGATIONS WITH A OBLIGATIONS WITH A - Obligations for whose fulfillment
PERIOD CONDITION - a day certain has been fixed
- [upon arrival of such day] shall be
“a day certain” uncertainty demandable
- [that is] only when that day
comes

understood to be that in whether the day will DEFINITION: PERIOD IN DIEM (RESOLUTORY EFFECT)
- upon the arrival of said period,
which must necessarily come or not - the obligation terminates
com - Obligations with a resolutory period
- RULE: take effect[demandable] at
shall be regulated by this obligation is conditional
section once
- RULE: but terminate upon arrival of
shall be regulated by
the day certain
the rules of the
preceding Section.

REQUISITES OF
a Valid Period or Term
• __

1. It must refer to the future.
2. It must be certain (sure to come) but can be
extended.
- (If eliminated subsequently by mutual
agreement, the obligation becomes pure
and immediately demandable). (Estate of
Mota v. Serra, 47 Phil. 464).
3. It must be physical and legally possible, otherwise
the obligation is void. (Example: “I’ll give you my
house one year after your death.” The obligation
here is void.)
obligation begins only from a day certain, in other words,
upon the arrival of the period.
- “I will support you, beginning the fi rst day of next
year.” Here, the obligation only becomes effective
on the day stipulated.
2) In diem — a period or term with a resolutory effect. Up to a
time certain, the obligation remains valid, but upon the arrival
of said period, the obligation terminates. (See 8 Manresa, pp.
160, 169).
- “I will support you until Jan. 1 of next year.” Here, the
obligation is immediately demandable and will end
only on Jan. 1 of the next year.

RULE: If an obligation is demandable “on or about Dec. 5, 2005,”

Period
In their fulfillment —
(type of event?)
when is it really demandable?
- ANS: A few days before or after Dec. 5, 2005, and not a
date far away nor one fixed by the debtor. (See Sy v.
De Leon, [C.A.] GR 288-R, Sept. 25, 1974).
Condition
RULE: CONDITION V. TERM (PARTY DIES)
In their fulfillment —
- An obligation stated “A will give B a car the moment X
(type of event?)
becomes 30 years old.” Now, X is only 28. Suppose X

but a period is an event
which must happen sooner or
later, at a date known
beforehand, or a time which
cannot be determined.
A condition is an uncertain dies at the age of 29, should A still give the donation?
event; - ANS.: Yes, it would seem that the parties really
intended a term, and not a condition, unless facts
should exist which show that the parties intended a
condition. (See Art. 606 of the Civil Code by analogy).

With reference to time With reference to time

A period always refers to the a condition may under the BURDEN OF PROOF
future law refer even to the past.
= EXTENSION OF PERIOD
As to influence on the As to influence on the • THE DEBTOR MUST PROVE —
obligation obligation

but a period merely fixes the A condition causes an - The Moratorium Laws of the Philippines UNCONSTITUTIONAL
time or the efficaciousness of obligation to arise or to - The purpose of a moratorium is to obtain a
an obligation. cease, postponement of the period within which to pay off
obligations.
- It is a suspension of payment, an act of grace. In the
The Different Kinds of Terms or Periods case of Rutter v. Esteban, 93 Phil. 68, the Moratorium
Laws were declared (in 1953) as unconstitutional
(a) — because:
1) Definite — the exact date or time is known and given. - the period stated in the law is indefinite;
2) Indefinite — something that will surely happen, but the - and the continuation of the moratorium will
date of happening is unknown (as in the case of death). be unreasonable and oppressive to creditors,
- inasmuch as, considering the period that has
elapsed since liberation, the debtors may be
(b) —
said to have already rehabilitated
1) Legal — a period granted under the provisions of the law.
2) Conventional or Voluntary — period agreed upon or themselves. (See also Llanes v. Insular Life
stipulated by the parties. Assurance Co., GR L-64656, Apr. 14, 1954).
3) Judicial — the period or term fixed by the courts for the - [NOTE: In general, the Moratorium
performance of an obligation or for its termination. Laws may be applicable also to
obligations contracted before the
(c) —
war. (Rio y Compania v. Datu
1) Ex die — a period with a suspensive effect. Here, the
Jolkipli, L-12301, Apr. 13, 1959).]

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• __

--------------------------------------------------------- - If A is supposed to deliver to B a particular car

- demandable on Mar. 1, 2005 [period ex die?]
- but the car is destroyed by a fortuitous event
[not the fault of the debtor] on Dec. 15, 2004
- RESULT: the obligation is extinguished.

RULE Article 1189 applies only if:

- (1) The obligation is a real obligation;
- efficacy of an obligation to give
- (2) The object is a specific or determinate thing;
- because Indeterminate or generic thing
cannot be lost
- Article 1263. In an obligation to deliver
a generic thing, the loss or
destruction of anything of the same
kind does not extinguish the
obligation. (n)
- lost without a debtor’s fault talks implies
fortuitous event and is usually applicable
only to determinate thing
- (3) The obligation is subject to a suspensive
condition;
- conditions have been imposed
with the intention of suspending
the efficacy of an obligation to
give
- (4) The condition is fulfilled; and
- from the way the article is worded, it is
talking about the moment the said
condition is already fulfilled
- (5)rules shall be observed in case of the
improvement, loss or deterioration of the
thing during the pendency of the
condition

LOSS RULES

RULE: [determinate thing] (1) LOST without the fault

of the debtor (fortuitous?)
- RESULT: obligation shall be extinguished
Article 1194. In case of loss, deterioration or
improvement of the thing before the arrival of the RULE: [determinate thing] (2) LOST through the fault
day certain, the rules in article 1189 shall be of the debtor
observed. (n) - RESULT: DEBTOR obliged to pay damages
- RULE obligation is converted into one of indemnity
---------------------------------------------------------
for damages.
OBLIGATIONS WITH A PERIOD
DETERIORATION RULES
(before the arrival of the day certain)
PERIOD EX DIE (SUSPENSIVE EFFECT)? RULE: [determinate thing] (3) DETERIORATES without
the fault of the debtor
In case of loss, deterioration or improvement of the - RESULT: impairment is to be borne by the

thing creditor

DUTY/RIGHTS OF CREDITOR/DEBTOR RULE: [determinate thing] (4) DETERIORATES

through the fault of the debtor
EXAMPLE:

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• __
- RESULT: the creditor may choose the
rescission of the obligation
- with indemnity for damages
- RESULT: the creditor may choose the
fulfillment of the obligation
- with indemnity for damages
IMPROVEMENT RULES
RULE:[determinate thing] (5) is IMPROVED by its
nature, or by time [example: Suppose the market value
of the car increased]
- RESULT: improvement shall inure to the
benefit of the creditor
[determinate thing] (6) is IMPROVED at the
RULE:
expense of the debtor [example: debtor had the car
painted and its seat cover changed at his expense.]
- RESULT: debtor shall have no other right
than that granted to the usufructuary.
- DEFINITION: A usufruct is a legal right
accorded to a person or party that confers
the temporary right to use and derive
income or benefit from someone else's
property.
- RULE: Consequently, the debtor cannot ask
reimbursement for the expenses incurred
for useful improvements or for
improvements for mere pleasure;56 [Art.
579, Civil Code]
- RULE: he can, however, ask reimbursement
for necessary expenses.57 [Art. 546, Civil
Code.]
- RULE: Although he cannot ask the creditor
to reimburse his expenses for useful
improvements and improvements for mere
pleasure, he has the right to remove such
improvements, provided it is possible to do
so without damage to the thing or
property.58 [Art. 579, Civil Code]
- RULE: He may also set off the improvements
he may have made on the property
against any damage to the same.59 [Art.
580, Civil Code]
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Article 1195. Anything paid or delivered before the
arrival of the period, 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. (1126a)
---------------------------------------------------------
OBLIGATIONS WITH A PERIOD
paid or delivered
(before the arrival of the period)
PERIOD EX DIE (SUSPENSIVE EFFECT)?
- Anything paid or delivered before the arrival of
the period
- A was supposed to pay B P1,000,000 on Dec. 31, 2005.
But believing that the obligation was due and
demandable already on Dec. 31, 2004, A paid B the
P1,000,000 on said date. How much may A recover
from B, say on Jun. 30, 2005?
- ANS.: A may recover from B on Jun. 30, 2005,
the amount of P1,000,000 which had been
prematurely paid plus of course interest at the
legal rate from Jan. 1, 2005, to Jun. 30, 2005,
6% of P1,000,000 = P60,000 (interest for one
year). P60,000 ÷ 2 = P30,000 (interest for the
half-year period from Jan. 1, 2005, to June 30,
2005). So A may recover a total of P1,000,000
from B.
- Of course, when Dec. 31, 2005 finally arrives,
A is supposed to give B the P1,000,000.
- Here A is allowed to recover what had been
in good faith prematurely paid, plus interest of
course.
RULE: obligor being unaware of the period (pays or
deliver)
- such may be recovered,
- with the fruits and interests.
PRESUMPTION
• The law presumes that the debtor knew of the
prematureness. This may, however, be rebutted by him. (8
Manresa 164). —
RULE: obligor believing that the obligation has
become due and demandable(pays or deliver)
- may be recovered,
- with the fruits and interests.
- Note that the phrases “within 8 years” and “within
the 8th year” have different meanings.
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• __

- RULE: Period Within Which Recovery May Be Made

- Before the debt matures (regarding what was paid).
- Even after maturity (regarding interest) for after all the
creditor was in BAD FAITH.
- (But the right prescribes 5 years after premature
payment.) (See Art. 1149, Civil Code).
- Article 1149. All other actions whose periods
are not fixed in this Code or in other laws must
be brought within five years from the time the
right of action accrues. (n)
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Article 1196. Whenever in an obligation a period is

designated, it is presumed to have been
established for the benefit of both the creditor and
the debtor, unless from the tenor of the same or
other circumstances it should appear that the
period has been established in favor of one or of
the other. (1127)
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OBLIGATIONS WITH A PERIOD

PERIOD: presumed “for the benefit of both the

creditor and the debtor”

PERIOD: “FIXED BY THE PARTIES”

RULE: [NOTE: This Article applies only where the parties to a

contract themselves have fixed a period,
- EXCEPTION: not APPLICABLE to a case where the
parties have authorized the Court to fix a reasonable
term. (Orit v. Balrodgan Co., Ltd., L-12277, Dec. 29,
1959).]

GENERAL RULE: it is presumed to have been

established for the benefit of both the creditor
and the debtor
- Rule: Term is for the benefit of debtor or creditor.
Meaning:

BENEFIT OF THE CREDITOR BENEFIT OF THE DEBTOR

The debtor cannot pay The creditor cannot demand

prematurely prematurely

When there is interest the debtor is interested

stipulated because he is given enough

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• __

time to pay). (See Sarmiento

(Here the creditor is v. Villaseñor, 43 Phil. 880). with the creditor given the Here DEBTOR can pay even
interested in the term right to demand after one week from the time
because of the interests that performance the obligation was
would be earned; contracted. (See Sia v. Court
even before said date. of Appeals, 48 O.G. 5259)
When the creditor is
interested in keeping his if there is a stipulation to this When the loan is without
money safely invested (thus effect interest, this is generally only
making the debtor a sort of for the benefit of the debtor.
depository) as when the contract
provides that no payment
when the creditor wants to should be made till after a
protect himself from the certain given period. (See
dangers of currency Ochoa v. Lopez, [C.A.] 50
depreciation. O.G. 5871, Dec. 1954).

Acceptance of partial When payment is to be

payment even before the made “within” a certain
expiration of the period period from date of contract.
means a waiver on the part (See Samson v. Aguila,
of the creditor of his right to supra).
refuse payment before the
end of said period. (Lopez v.
Ochoa, L-7955, May 30,
1958).]

EXCEPTION RULE: “if there be such intent”

(1) unless from the tenor of the same

- it should appear that the period has been
established in favor of one or of the other
CIRCUMSTANCES WHICH INDICATE FOR
(2) or other circumstances WHOM THE BENEFIT OF THE TERM IS
- it should appear that the period has been
(a) For the benefit of both
established in favor of one or of the other.
1) When there is interest stipulated (Here the creditor is
BENEFIT OF THE CREDITOR BENEFIT OF THE DEBTOR
interested in the term because of the interests that would be
earned; the debtor is interested because he is given enough
Intent to make Term for the Intent to make Term for the
time to pay). (See Sarmiento v. Villaseñor, 43 Phil. 880).
benefit of the creditor alone. benefit of the debtor alone.

2) When the creditor is interested in keeping his money safely

(benefit 1) Creditor can (benefit 1) DEBTOR is required
invested (thus making the debtor a sort of depository),
demand at any time to pay only at the end,

3) when the creditor wants to protect himself from the

(benefit 2) but Creditor may
demand even before the
term expires
(benefit 3) Creditor cannot
be compelled to accept
payment from the debtor
prior to the stipulated period.
Example: D promised to pay
on Dec. 1, 2005,
(benefit 2) but DEBTOR may
pay even before
(benefit 3) DEBTOR may also
resist premature demand for
compliance. (See Samson v.
Andal de Aguila, L-5932, Feb.
25, 1954).]
Example: DEBTOR will pay
CREDITOR “within 6 years.”
dangers of currency depreciation.
(b) For the benefit of the debtor
1) When the loan is without interest, this is generally only for
the benefit of the debtor. [NOTE: This rule, however, is NOT
absolute, for even if the creditor receives no interest, still he
may have entered into the contract to protect himself
against the sudden decline in the purchasing power of the
currency. (Aguilar v. Miranda, L-16510, Nov. 29, 1961).]

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• __
2) When payment is to be made “within” a certain period
from date of contract. (See Samson v. Aguila, supra).
(c) For the benefit of the creditor
1) [Usually, this only exists if there is a stipulation to this effect,
- as when the contract provides that no payment
should be made till after a certain given period. (See
Ochoa v. Lopez, [C.A.] 50 O.G. 5871, Dec. 1954).
2) Acceptance of partial payment even before the expiration
of the period
- means a waiver on the part of the creditor of his
right to refuse payment before the end of said
period. (Lopez v. Ochoa, L-7955, May 30, 1958).]
- RULE: [Prescriptive Period starts]
- In obligations with the benefit of the term given to both
debtor and creditor, the right of action accrues from
the end of the stipulated period, because it is only from
that time that the obligation really becomes
enforceable. (See Sarmiento v. Villaseñor, 43 Phil. 880).
- RULE: [10 YEAR CAP] Under the New Civil Code, an action upon
a written contract (of loan, for example) must be brought within
10 years from the time the right of action accrues. (Art. 1144).
Article 1144. The following actions must be brought within ten
years from the time the right of action accrues:
(1) Upon a written contract;
(2) Upon an obligation created by law;
(3) Upon a judgment. (n)
Article 1197. 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 upon 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 the courts, the period cannot be changed by
them. (1128a)
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OBLIGATIONS WITH A PERIOD
PERIOD: “FIXED BY THE COURT”
WHEN the courts may fix the duration thereof.
Once fixed by the courts, the period cannot
RULE:
be changed by them.
How the Court Fixes the Period
courts shall determine such period
RULE [guide]:
as may under the circumstances have been
probably contemplated by the parties
The Court determines the period by considering the time
probably contemplated by the parties. (Art. 1197).
Once the period is fixed by the courts, the period becomes
part of the contract, thus the courts cannot change it.
(Ibid.).
RULE: [Compromise Agreement] The same is true if the
period is fixed in a compromise agreement approved by
the Court. This is because the compromise agreement
acquires the same force and effect as the decision.
(Deudor v. J.M. Tuason & Co., Inc., L-13768, May 30, 1961).
RULE: [change agreement] The parties may of course
change the period by mutual agreement, or may even
disregard the same (See Barretto v. City of Manila, 11 Phil.
624) in which case, the obligation becomes a pure one,
and demandable at once. (See Art. 1197).
(1)If the obligation does not fix a period, but from
its nature and the circumstances it can be
inferred that a period was intended
ACTION AVAILABLE FOR
CREDITOR
- Creditor can ask the court to fix the period within
which the debtor must pay for the simple reason
that the fulfillment of the obligation itself cannot
be demanded until after the court has fixed the
period for its compliance. (Vda. de Ungson v.
Lopez, [C.A.] GR L-10180-R, Mar. 10, 1954, 50 O.G.
4298).
- Examples:1) A contract to construct a house where
the period was not stated. (See Concepcion v.
People, 74 Phil. 163).
- 2) A donation where land was given provided
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• __
certain construction was to be made on it. Here the
time within which construction is to be made should
be fixed by the courts. (Barretto v. City of Manila, 7
Phil. 416).
- 3) An obligation with an indefinite period, such as
when the time for the payment of a subscription of
shares of stocks has not been fixed. As a matter of
fact in a case like this, the obligation must generally
be immediately fulfilled, giving the debtor only such
time as might reasonably be necessary for its actual
fulfillment. (Schenker v. Gemperle, L-16499, Aug. 31,
1962).
- In a sale on credit, when the parties forgot to state in
the invoice the period for payment. (Cosmic Lumber
Co., Inc. v. Manois, L-12692, Jan. 30, 1960).
- In a lease contract, the court must fi x the duration
of the lease when a stipulation thereof reads — “The
owners of the land undertake to maintain the Lawn
Tennis Club as tenant as long as the latter shall see fi
t.” (Here the court said that Art. 1197 applies
because there was a conventional period though it
was indefi nite, and not Art. 1687 which applies only
when no period was agreed upon, in which case
the law fi xes the legal period stated in Art. 1687)
(Eleizegui v. Lawn Tennis Club, 2 Phil. 309); or when
the contract states “as long as the tenant pays the
stipulated rent.” (Yu Chin Piao v. Lim Tuaco, 33 Phil.
92).
(2) when it depends upon the will of the debtor.
- Examples:
- 1) “when my means permit me to do so” (Art. 1180,
Civil Code)
- 2) “I’ll pay you little by little” (Seone v. Franco, 24
Phil. 309)
- 3) “as soon as possible” (Gonzales v. Jose, 38 O.G.
1751; 66 Phil. 369)
- 4) “as soon as I have money” (Patente v. Omega,
GR L4433, May 29, 1953)
- 5) “in partial payments” (Levy Hermanos v. Paterno,
18
- Phil. 353)
- 6) When the debtor is “in a position to discharge his
obligation.” (See Luding Hahn v. Lazatin, et al.,
L11346, 11549, Jun. 30, 1959).
When the Court May Not Fix the Term
- When no term was specified by the parties because no term
was even intended, in which case the obligation is really a
pure one, and demandable at once, unless of course absurd
consequences would arise. (Art. 1179, par. 1 of the Civil Code
by implications; TS, Oct. 20, 1892).
- When the obligation or note is “payable on demand.”
(People’s Bank v. Odom, 64 Phil. 126).
- When a repairer of typewriters who has been given a
typewriter to repair but without a period within which to do
the work, returns the typewriter without performing any work
thereon, he has lost whatever right he originally had to have
the period fixed under Art. 1197. (Chaves v. Gonzales, L-27454,
Apr. 30, 1970). Here, the owner of the machine had it repaired
by someone else. The Court ruled that the original repairman
can be required to pay the person who actually made the
needed repairs. The Court applied Art. 1167. (Ibid.)
- When specific periods are provided for in the law, as in an
employment contract where if no period was agreed upon,
the time of employment depends upon the time for payment
of salary.
- When what appears to be a term is really a condition (such
as when a debt is payable only after the debtor’s estate’s
other debts have been paid, for this does not depend upon
the exclusive will of the debtor). (See Martin v. Boyero, 55 Phil.
760).
- When the period within which to ask the Court to have the
period fi xed has itself already prescribed. (Calero v. Carrion,
et al., L-13246, Mar. 30, 1960).
RULE: An Example Where the Article Is Not Applicable
- [Millare v. Hernando GR 55480, Jun. 30, 1987]: This
Article does not apply to a contract of lease which
fixes a period, e.g., an original period of five years,
which has expired, and where the parties reserved
to themselves the faculty of agreeing upon the
period of the renewal contract.
- It does not also apply if the duration of the renewal
period is not left to the will of the lessee alone, but
rather to the will of the lessor and the lessee.
- Art. 1197 applies only where a contract of lease
clearly exists. If the contract is not renewed at all,
there could be no contract the period of which
could be fixed.
UNTIL WHEN THE ACTION TO FIX THE
PERIOD CAN BE BROUGHT
RULE: Within the proper prescriptive period for specific
performance if a period had been originally fixed, but to be
counted from the perfection of the contract.
- This is because the right exists by operation of law
from the moment of such agreement.
- RULE Extrajudicial demand is not therefore essential
for the creation of the cause of action to have the
period fixed. (Calero v. Carrion, et al., L-13246, Mar.
30, 1960).
- RULE In this case, the court said that the prescriptive
period is 10 years.
- Example: D wrote a promissory note in C’s favor
promising payment “little by little.”
- Within 10 years from the date the written contract
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• __
was perfected, C must bring the action to fix the
term.
- If the period lapses, the right to have the court fix the
term is considered to have prescribed. (See
Gonzales v. Jose, 66 Phil. 369).
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Article 1198. The debtor shall lose every right to
make use of the period:
(1) When after the obligation has been contracted,
he becomes insolvent, unless he gives a guaranty
or security for the debt;
(2) When he does not furnish to the creditor the
guaranties or securities which he has promised;
(3) When by his own acts he has impaired said
guaranties or securities after their establishment,
and when through a fortuitous event
disappear, unless he immediately gives new ones
equally satisfactory;
(4) When the debtor violates any undertaking, in
consideration of which the creditor agreed to the
period;
(5) When the debtor attempts to abscond. (1129a)
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OBLIGATIONS WITH A PERIOD
PERIOD
EXTINGUISHMENT OF DEBTOR’S RIGHT
MEANING: “debtor shall lose every right to make use
of the period”
- the term is extinguished
- the obligation is demandable at once.
WHEN PERIOD IS EXTINGUISHED BY DEBTOR ACTIONS
RULE: When after the obligation has been
contracted, he(DEBTOR) becomes insolvent
- EXCEPTION RULE: he gives a guaranty or
security for the debt
Of Par. 1: D owes C P1,000,000 demandable on Jul. 3, 2008. In
December, 2004, D became insolvent. The debt is
immediately demandable in December, 2004 unless D can
offer sufficient security.
RULE:When he(DEBTOR) does not furnish to the
creditor the guaranties or securities which
he(DEBTOR) has promised;
Of Par. 2: If a debtor instead of making a mortgage in favor of
the creditor, makes it in favor of another person, he fails to
furnish the promised guaranties, and he therefore loses the
benefi t of the term. (Daguhoy Enterprises, Inc. v. Ponce, et
al., 96 Phil. 15). The same thing is true if instead of mortgaging
to the creditor 3 parcels of land, he mortgages only two of
them. (Laplana v. Garchitorena, 48 Phil. 163).
RULE 3A: has impaired said guaranties or securities
- When by his(DEBTOR) own acts
- after their establishment
- EXCEPTION RULE: unless he(DEBTOR)
immediately gives new ones equally
satisfactory;
RULE 3B: [said guaranties or securities] [disappear]
they
- through a fortuitous event
- EXCEPTION RULE: unless he(DEBTOR)
immediately gives new ones equally
satisfactory;
Of Par. 3: If a mortgaged house is allowed to decay by the
mortgagor, he impairs the value of the guaranty, and
therefore the debt becomes demandable immediately. In
the same way, if a mortgaged house is completely lost
(disappears) in a typhoon, the debt is due at once unless
another mortgage equally good is constituted. This is true
even if the loss is through a fortuitous event.
RULE: debtor violates any undertaking
- in consideration of which
- the creditor agreed to the period
Of Par. 4: If a condition, such as not to gamble anymore, is
violated, any term given because of the condition is lost. If an
employee commits a substantial breach of his employment
contract, the employer may terminate the employment, even
if there was a fixed duration for the job. (Marcaida v. Phil.
Educ. Co., L-9960, May 29, 1957 and Gonzales v. Haleerer, 47
Phil. 380). This paragraph was applied by the court in Corpus
v. Alikpala (L-23707, Jan. 17, 1968).
RULE: debtor attempts to abscond
RULE: Note that it is not essential that there be an actual
absconding,
RULE: The intent to do so being sufficient.
RULE” Upon the other hand, a mere physical leaving, with no
intent to defraud, is not sufficient.
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Of Par. 5: An attempt by the debtor to escape is a sign of bad

faith, hence, the loss of the term. Note that it is not essential
that there be an actual absconding, the intent to do so being
sufficient. Upon the other hand, a mere physical leaving, with
no intent to defraud, is not sufficient.

How Terms or Periods Are Computed

“When the laws speak of years, months, days or nights, it

shall be understood that —
(a) years — are of three hundred sixty-five days each;
(b) months — of thirty days;
(c) days — of twenty-four hours;
(d) and nights — from sunset to sunrise.

“If months are designated by their name, they shall be

computed by the number of days which they respectively
have.’’

“In computing a period, the first day shall be excluded and

the last day included.” (Art. 13, Civil Code).

“In computing any period of time prescribed or allowed by

these Rules, or by order of the court, or by any applicable
statute, the day of the act or event from which the
designated period of time begins to run is to be excluded and
the date of performance included. If the last day of the
period, as thus computed, falls on a Saturday, a Sunday, or a
legal holiday in the place where the court sits, the time shall
not run until the next working day.’’ (Sec. 1, Rule 22, 1997
Rules of Civil Procedure).

“Where the instrument is payable at a fixed period after

date, after sight, or after the happening of a specified event,
the time of payment is determined by excluding the day from
which time is to begin to run, and by including the day of
payment.” (Sec. 85, Negotiable Instruments Law).

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