SECTION 6.

- NOVATION
 Art. 1291. Obligations may be modified by:
(1) Changing their object or principal conditions;
(2) Substituting the person of the debtor;
(3) Subrogating a third person in the rights of the
creditor. (1203)
Novation
DUAL FUNCTION

To extinguish
To substitute
an existing
a new one in
obligation
its place
 Real or When the object or
principal condition are
objective changed

Person of the debtor is

Personal or substituted and/or a 3rd
person is subrogated in
subjective the rights of the creditor
The object and the
debtor or the creditor, or
Mixed both parties, are
changed
 Art. 1292. In order that an obligation may be
extinguished by another which substitute the same,
it is imperative that it be so declared in unequivocal
terms, or that the old and the new obligations be on
every point incompatible with each other. (1204)
 The creation of a new valid obligation
Modification or extinguishment of the obligation
Capacity and intention of the parties to modify or
extinguish the obligation
A previous valid obligation
REQUISITES
 Art. 1293. Novation which consists in substituting a
new debtor in the place of the original one, may be
made even without the knowledge or against the
will of the latter, but not without the consent of the
creditor. Payment by the new debtor gives him the
rights mentioned in Articles 1236 and 1237. (1205a)
KINDS OF PERSONAL NOVATION

Substitution
When the person of the debtor is substituted

Subrogation
When the third person is subrogated in the
rights of the creditor
KINDS OF SUBSTITUTION

Expromision
Takes place when a third person of his own
initiative and without the knowledge or against the
will of the debtor assumes the latters obligation
with the consent of the creditor.
Delegacion
Takes place when the creditor accepts a 3rd
person to take the place of the debtor at the
instance of the latter (debtor)
 Art. 1294. If the substitution is without the
knowledge or against the will of the debtor, the new
debtor's insolvency or non-fulfillment of the
obligations shall not give rise to any liability on the
part of the original debtor. (n)
 Art. 1295. The insolvency of the new debtor, who
has been proposed by the original debtor and
accepted by the creditor, shall not revive the action
of the latter against the original obligor, except
when said insolvency was already existing and of
public knowledge, or known to the debtor, when the
delegated his debt. (1206a)
DELEGACION

General rule
Old debtor is not liable to the creditor in case of
insolvency of the new debtor
Exceptions
Insolvency was already existing and of public
knowledge (although not known to the old debtor)
Insolvency was already existing and known to the
debtor (although not of public knowledge)
 Art. 1296. When the principal obligation is
extinguished in consequence of a novation,
accessory obligations may subsist only insofar as
they may benefit third persons who did not give
their consent. (1207)
 Art. 1297. If the new obligation is void, the original
one shall subsist, unless the parties intended that
the former relation should be extinguished in any
event. (n)
 Art. 1298. The novation is void if the original
obligation was void, except when annulment may
be claimed only by the debtor or when ratification
validates acts which are voidable. (1208a)
 Art. 1299. If the original obligation was subject to a
suspensive or resolutory condition, the new
obligation shall be under the same condition,
unless it is otherwise stipulated. (n)
 Art. 1300. Subrogation of a third person in the
rights of the creditor is either legal or conventional.
The former is not presumed, except in cases
expressly mentioned in this Code; the latter must
be clearly established in order that it may take
effect. (1209a)
 Art. 1301. Conventional subrogation of a third
person requires the consent of the original parties
and of the third person. (n)
 Art. 1302. It is presumed that there is legal subrogation:
(1) When a creditor pays another creditor who is
preferred, even without the debtor's knowledge;
(2) When a third person, not interested in the obligation,
pays with the express or tacit approval of the debtor;
(3) When, even without the knowledge of the debtor, a
person interested in the fulfillment of the obligation
pays, without prejudice to the effects of confusion as to
the latter's share. (1210a)
 Art. 1303. Subrogation transfers to the persons
subrogated the credit with all the rights thereto
appertaining, either against the debtor or against
third person, be they guarantors or possessors of
mortgages, subject to stipulation in a conventional
subrogation. (1212a)
 Art. 1304. A creditor, to whom partial payment has
been made, may exercise his right for the
remainder, and he shall be preferred to the person
who has been subrogated in his place in virtue of
the partial payment of the same credit. (1213)