re: lecture notes coverage PRELIMS

I. General Provisions, Nature and Effects of Obligations

a. General Provision

- - Juridical Necessity – enforce compliance; seek damages

- - To give, to do, and not to do – Examples

- - Four essential requisites of an obligation
(i) (i) A passive subject (Debtor – to give; Obligor – to do)
(ii) (ii) An active subject (Creditor/Obligee)
(iii) (iii) Object (Prestation) – subject matter
(iv) (iv) Juridical tie (Vinculum) – Source of Obligation

- - Form as a manifestation of intent; but no specific form unless required by law

(b) (b) Kinds of Obligations
1. 1. According to subject matter
a. a. Real Obligation – to give
b. b. Personal Obligation – to do
i. i. Positive – to give or do
ii. ii. Negative - not to do or not to give

A borrower agreed to pay his debt in 60 days, and in case of non-payment to render free service as driver/servant. When due date came, borrower refused to render free service. Decide.

2. 2. According to person obliged
a. a. Unilateral
b. b. Bilateral (Reciprocal or non-reciprocal)

(c) (c) Sources of Obligation
1. 1. LAW – Imposed by law

- - A wife was about to deliver a child. Her neighbor brought her to hospital. Who should pay the hospital bill – Husband or Neighbor?

- - P.D. 1517 grants the right of first refusal to person who has leased for more than 10 years an urban land and who construct his house thereon. Lessee of a Condo in Manila now claims his right of first refusal because he has been living in the unit for almost 15 years. Decide.

Obligations derived from law are not presumed.

- - In a newspaper ad, there was an offer to replace 30 sachets of Tide for one Venetian cut Glass until the end of the year. At the end of the year, you present your tide sachets, but Tide refused to honor it anymore since the ad was posted more than half a year ago. Decide. 657

a. a. Quasi-contracts – Juridical relations based on the principle that no one shall be unjustly enriched or benefited at the expense of another.

i. i. Negotiorum Gestio – When a person voluntarily takes charge of the management of a business or property of another that has been neglected or abandoned, without any power from the latter, as a consequence of which, he is obliged to continue the same until the termination of the affair or to require the owner to substitute him. Ex. NPA infested area Fishpond

ii. ii. Solutio indebiti – When a person unduly delivers a thing through mistake to another who has no right to demand it. (melon bank v. Javier)


b. b. Crimes (acts or omission punished by law)

If you commit a crime, you are liable both criminally and civilly for the consequence of your acts or omissions such as restitution, reparation for damages caused and indemnification for consequential damages.

Ex. Support for impregnated rape victim; loss of earning capacity of murder victim

c. c. Quasi delict or Torts – The fault or negligence of a person who, by his act or omission, independent from any contractual relation, causes damage to another person

  A 3-year-old child was bitten by a dog of her neighbor. As a result, she got infected by rabies and died. Can the neighbor be held liable for the acts of the dog?

  A signboard of hanging out of a building dropped on a car resulting in total wreck of the car. The car owner sues the building owner and demand to replace the car. Building owner cites the strong wind as force majeure condition indicating no fault on his part. Decide.

2. 2. Contracts

  Have the force of law between the contracting parties and should be complied with in good faith.
  Sincerity and Honesty


II. Nature and Effect of Obligations

(a) (a) Specific v. Generic Thing
1. 1. Specific is designated or physically segregated from others of the same class.
2. 2. Generic refers to a class or genus and cannot be determined with particularity.

(b) (b) Duties of debtor in delivery of generic thing
1. 1. To delivery a thing which must neither be of superior nor inferior quality (1246)
2. 2. To pay damages in case of breach (1170)

(c) (c) Duties of debtor in delivery of specific thing
1. 1. To deliver the thing which he has obligated himself to give
2. 2. To take care of the thing with the proper diligence of a good father of a family
• • The ordinary care that an average or reasonably prudent person exercises over his property
• • Another standard of c are may be required by law or by stipulation of the parties
3. 3. To deliver all the accessions and accessories
4. 4. To pay damages in case of breach

(d) (d) Remedies of Creditors in breach of obligation
1. 1. To Give Determinate Thing
a. a. To compel specific performance
b. b. To recover damages

2. 2. To Give Indeterminate Thing
a. a. To ask for performance of the obligation
b. b. To ask that obligation be complied with by another at expense of debtor
c. c. To recover damages

3. 3. To Do
a. a. To have the obligation performed at debtor’s expense
b. b. To recover damages

4. 4. Not to Do
a. a. Undone at his expense
b. b. To recover damages

(e) (e) Rules on Fruits
1. 1. Kinds of fruits
a. a. Natural – product of the soil, young and other products of animals
b. b. Industrial – produced thru cultivation or labor
c. c. Civil – derived by juridical relations

2. 2. Creditor has rights to the fruits from the time the obligation to deliver arises

3. 3. Real rights acquired only when delivered to him
a. a. Real rights - right over a specific thing without any passive subject, directed against the whole word.
b. b. Personal rights – right to demand from another debtor the fulfillment of the latter’s obligation

(f) (f) Accessions and accessories
• • Accessions – fruits of a thing or additions to or improvement upon a thing
• • Accessories – joined to or included with the principal thing for better use or completion.

1. 1. Even if not mentioned, accessories follow the principal
2. 2. But obligation to deliver accessions or accessories does not include the principal

(g) (g) Legal Delay
1. 1. From the time obligee judicially or extra-judicially demand fulfillment; not mere notice

2. 2. No demand from creditor necessary in following cases:
a. a. When obligation or law expressly so declares
b. b. Time is of the essence (controlling motive)
c. c. When demand would be useless

3. 3. In reciprocal obligation, from the moment one party fulfills his obligation, delay by the other begins.

4. 4. Kinds of Delay
a. a. Mora solvendi – delay on the part of debtor
b. b. Mora acccipiendi – delay of creditor
c. c. Compensatio more – delay in reciprocal obligation

5. 5. Effects of Delay
a. a. Liable for interest and damages
b. b. Liable even for fortuitous event when the obligation is to delivery a determinate thing

(h) (h) Fortuitous Events
1. 1. Any event which cannot be foreseen or which though foreseen is inevitable, independent of the will or from aggravation of the debtor, render impossible the fulfillment of obligation
2. 2. No person shall be responsible for fortuitous events, except:
a. a. Where expressly specified by law or stipulated in contract
b. b. When nature of the obligation requires assumption of risk
c. c. When debtor incurs delay
d. d. When debtor promises to deliver same thing to two or more persons
e. e. When obligation to deliver arises from criminal offense
f. f. When obligation is generic

(i) (i) Fraud (deceit or dolo) Deliberate or intentional evasion of the normal fulfillment of an obligation;
1. 1. Dolo incidente (Incidental Fraud) - committed in the performance of pre-existing obligation, remedy is damages
2. 2. Dolo causante (Causal Fraud) – Fraud employed at the time of the execution of a contract in order to secure consent, remedy is annulment bec of vitiation of consent
3. 3. Demandable in all obligations
4. 4. Waiver of future fraud is void

(j) (j) Negligence (culpa) Omission of that diligence which is required by the nature of the obligation, but no malice
1. 1. Culpa contractual – Negligence in the performance of contractual obligation,
a. a. Pre-existing contract
b. b. Liable for damages based on breach of contract
c. c. Proof of contract and breach is enough for recovery of damage
d. d. Negligence of employee conclusive presumption of employer’s negligence
e. e. Proof of due diligence in the selection of employee not a defense

2. 2. Culpa aquiliana – Negligence between parties not so related by any pre-existing contract,
a. a. Obligation for damages based on quasi delict
b. b. No pre existing contract
c. c. Negligence must be proved for recovery of damage
d. d. Negligence of employee prima facie presumption of employer’s negligence
e. e. Due diligence in the selection and supervision of employee is a valid defense

3. 3. Can be regulated by the Court depending on circumstance
4. 4. Waiver of future negligence allowed

(k) (k) Presumptions
1. 1. Receipt of principal without reservation as to interest = presumption of interest paid
2. 2. Receipt of later installment of debt without reservation of prior ones = presumption that prior ones paid

(l) (l) Remedies to satisfy claim
1. 1. Exhaust property of debtor
2. 2. Subrogated to rights and actions of debtors, except those inherent to person
3. 3. Impugn all of acts by debtor done to defraud creditor


II. Different Kinds of Obligations

(a) (a) Pure and Conditional Obligations

1. 1. Pure Obligation – One whose effectivity or extinguishments does not depend upon the fulfillment or nonfulfillment of a condition or upon the expiration of a term or period. Characterized by Immediate Demandability.

2. 2. Conditional Obligation – Effectivity is subordinated to the fulfillment or non-fulfillment of a future or uncertain fact or event

  Future and uncertain event or
  Past event and unknown to the parties

a. a. Suspensive v. Resolutory

  In suspensive condition, fulfillment give rise to an obligation – acquisition of rights
  In resolutory condition, fulfillment extinguishes obligation – loss of rights acquired

b. b. Casual, Potestative, Mixed

  Casual – Depends on chance or will of third party (Valid)
  Potestative – Depends on the will of one of the contracting parties
(1) (1) If suspensive condition depends on will of debtor, the obligation is void
(2) (2) If resolutory condition depends on will of debtor, the obligation is valid
(3) (3) If depends on will of creditor, it is valid.

  Mixed – Depends partly upon the will of a party and partly upon chance or third party (Valid)

c. c. Impossible Conditions

- - Physically Impossible or legally impossible
- - If “to do”, whole obligation is void
- - If “not to do”, obligation is valid, as if not written
- - If divisible, part not affected by impossible condition is valid.

d. d. Positive v. Negative

i. i. Positive Condition (event will happen) extinguished:

  As soon as time expires without the event taking place
  As soon as it becomes indubitable that the event will not take place

ii. ii. Negative Condition (event will not happen) effective:

  As soon as time expired without event taking place
  As soon as it becomes evident the event cannot occur

e. e. Reciprocal v. Unilateral

i. i. If reciprocal, the fruits are deemed mutually compensated

ii. ii. If unilateral, fruits and interest belongs to debtor

3. 3. Condition deemed fulfilled when obligor prevents its fulfillment

4. 4. Creditor may before the fulfillment of the condition bring appropriate actions for the preservation of the rights.

5. 5. Debtor may recover what he has paid by mistake before the fulfillment of condition.

6. 6. Effects of the fulfillment of a condition retroacts to the day of the constitution of the obligation.

7. 7. Rule on loss or deterioration, improvements before the fulfillment of condition

  Lost – when perished, go out of commerce, or disappear in such a way that its existence unknown or cannot be recovered

a. a. If without the fault of debtor, the obligation is extinguished
b. b. If lost thru fault of debtor, obliged to pay damages
c. c. When deteriorate without fault of debtor, creditor bores the impairment
d. d. When deteriorate with fault of debtor, creditor may rescind or fulfillment with damages
e. e. When improved by nature, or by time, inure to the benefit of creditor
f. f. When improved by debtor, no right to be indemnified, but may remove such improvement, or set off against damage

8. 8. Remedies in reciprocal obligation

a. a. Specific Performance or Rescission

b. b. With damages in either case

c. c. Alternative remedy not cumulative – can choose one but not both

d. d. After action for specific performance impossible, option for rescission

e. e. Injured party must resort to judicial rescission,
i. i. Except where automatic rescission expressly stipulated
ii. ii. Or where there is no performance yet

f. f. Power of the court to fix period

g. g. Subject to right of good faith third party

h. h. Substantial breach not slight breach

i. i. Where both parties have breach, liability of first infractor equitably tempered; where first infractor not know, both parties bear own damages