CHAPTER 3 - KINDS OF OBLIGATIONS (ART. 1179 - 1230) Flashcards
Obligations without a term or condition and is demandable at once
Pure obligations
I will pay you 500,000 is what kind of obligation?
Pure obligation
The effectivity of the obligation is dependent upon the happening or non-happening of a future and uncertain event
Conditional Obligation
What event should be present in an conditional obligation?
Future and Uncertain Event
Can past but unknown a valid event in terms of conditional obligations?
Yes
If the obligation is dependent on a future and certain event, what is that obligation called?
Obligations with a period
The happening of event will give rise to an obligation
Suspensive Condition
The happening of that event will extinguish the obligation
Resolutary Condition
Other term for Suspensive Condition
Condition antecedent or condition precedent
Other term for resolutary condition
Condition subsequent
I will give you 500,000 if you pass the 2024 bar examination
Suspensive Condition
I will give you a 20,000 monthly allowance until you pass the 2024 Bar Examinations
Resolutary Condition
What is article 1180?
When the debtor binds himself to pay when his means permit him to do so, so the obligation shall be deemed to be one with a period, subject to the provision of Article 1197. (Art. 1180)
Acquisition of rights
Suspensive Condition
Extinguishment or loss those already acquired
Resolutary Condition
Condition that depends on the sole will of one of the contracting parties
Potestative
Potestative on the part of the debtor + suspensive
Obligation is?
Void
Potestative on the part of the debtor + resolutary
Obligation is?
Valid
Potestative on the part of creditor + suspensive and resolutary
Obligation is?
Valid
Condition that depends upon chance or upon the will of third person
Casual
Obligations arising from casual conditions are?
Valid
A condition that depends partly upon the will of one of the parties and partly upon chance or upon the will of a third person
Mixed
Obligations arising from mixed conditions are?
Valid
D is to give C 50,000 if D goes to Baguio
Potestative on debtor and suspensive
D is to allow the use of his car by C until D returns from Baguio
Potestative on debtor and resolutory
D is to give C 50,000 if C goes to Baguio
Potestative on creditor and suspensive
D is to allow the use of his car by C until C returns from Baguio
Potestative on creditor an resolutary
D is to give C 50,000 if D wins the first prize in the lotto on the bet he placed this morning
Casual
D is to give C 50,000 if X goes to Baguio
Casual
D is to give C 50,000 if C will marry X
Mixed
When they, in nature of things, cannot exist or cannot be done
Physically impossible conditions
When conditions are contrary to law, morals, good customs, public order, or public policy
Legally impossible conditions
I will pay you P10,000 if it will not rain for one year in the Philippines
Physically impossible conditions
I will pay you P10,000 if you can carry twenty (20) cavans of palay on your shoulder
Physically impossible conditions
X will give Y P1,000 if Y-
(1) will kill Z (against the law); or
(2) will be the common-law wife of X (against morals); or
(3) will slap his father (against good customs); or
(4) will publicly advocate the overthrow of the govern- ment (against public order); or
(5) will not appear as a witness against X in a criminal case (against public policy).
Legally impossible conditions
Condition that some event will happen at a determinate time
Positive Condition
What happens to the obligation as soon as time expires or it has become indubitable that the event will not take place
It will extinguish
Condition that some event will not happen at a determinate time.
Negative Condition
What happens to the obligation as soon as time indicated has elapsed or it has become evident that the event will not occur?
It will become effective
P promise G to deliver his car if G will pass the bar exam. On the day of the examination, P poison G and G cannot take the bar exam anymore.
What is this fulfillment?
What will happen to the obligation?
Constructive Fulfillment, the obligation is not void. Debtor is still liable to fulfill the obligation.
What is the general rule in the effect of fulfillment of suspensive condition
The effect of the fulfillment of the suspensive condition retroacts to the day of the constitution of the obligation
Effects of Fulfillment of suspensive condition
P obliged himself to sell a parcel of land to G if she passed the Bar Exam on November and the results will be at December. Bago lumabas ang result, P is still the owner of the parcel of land because hindi pa nangyari yung condition. Pag labas ng result by December 2020, pumasa si G, after payment of delivery, G becomes the owner of the land (retroactive effect)
Paano kung nung October, binenta ni P kay B ang parcel of land, is it still valid?
Yes, because P is still the owner
Exceptions in effects of Fulfillment of suspensive condition
There shall be no retroactive effect with respect to the fruits and interest in reciprocal and unilateral obligations
The fruits and interests shall be deemed to have been mutually compensated, i.e., each party shall keep the fruits and interest received by him prior to the fulfillment of the condition.
Reciprocal Obligations in Fulfillment of suspensive condition
On May 1, 2019, S agreed to sell his land to B and B agreed to pay the price of P50,000.00 if X finishes his Accounting degree on March 15, 2024. X finished his Accounting degree as stipulated.
What would be the rule and exception?
Rule: It was as if S was entitled to the price and B to the land beginning on May 1. 2019.
Exception: S shall keep the fruits on the land and B the interest on the price during the pendency of the condition
The debtor keeps the fruits and interests received before the fulfillment of the condition.
Unilateral Obligations in Fulfillment of suspensive condition
On May 1, 2022. S promised to give B his land if B passed the Bar Examination in February 2023. B passed the Bar Examination as stipulated. What would be the rule and exception?
Rule: It was as if B was entitled to the land beginning on May 1, 2022
Exception: S will keep the fruits on the land during the pendency of the condition.
Rights given by him to bring the appropriate actions for the preservation of his right, such as by registering his claim with the Register of Deeds, if appropriate, to notify all third persons, or by asking the debtor to provide a security if the debtor is about to become insolvent.
Creditor
Rights given by him to recover what he has paid by mistake
Debtor
When does a thing considered loss?
When it perishes, or goes out of commerce or disappears in such a way that its existence is unknown or it cannot be recovered
What rule is applied when the thing is loss without the debtor’s fault
Obligation is extinguished
What rule is applied when the thing is loss with the debtor’s fault
Debtor is obliged to pay damages
D is obliged to give a specific house to C if C passes the CPA Licensure Examination. If the house is destroyed in a fire without the fault of D before C passes the CPA Licensure Examination. What is the rule?
D’s obligation is extinguished even if C, thereafter, passes the CPA Licensure Examination
D is obliged to give a specific house to C if C passes the CPA Licensure Examination. If the house is destroyed through the fault of D such as when he placed inside the house highly flammable chemicals which caused the fire. What is the rule?
D shall be obliged to pay damages to C should the latter pass the CPA Licensure Examination
When does a thing considered deteriorated?
If it becomes impaired in quality, functioning or condition.
What rule is applied when the thing is deteriorated without the debtor’s fault
The impairment shall be borne by the creditor, i.e., no liability on the part of the debtor to pay damages
What rule is applied when the thing is deteriorated with the debtor’s fault
The creditor may choose between
(a) Rescission, plus damages, and
(b) Fulfillment, plus damages.
D is obliged to give a specific car to C if finishes his economics degree. The deterioration of the car due to wear and tear before C finishes his economics degree will be borne by who?
Will be borne by C if C later finishes the said degree
D is obliged to give a specific car to C if finishes his economics degree. The deterioration of the car due to wear and tear before C finishes his economics degree will be borne by C if C later finishes the said degree. However, if the car is damaged in an accident due to D’s fault, C, if he finishes his economics degree. What would be the rule?
He may rescind the contract and ask for damages
Ask D to deliver the car in its deteriorated condition plus damages.
When does a thing considered improved?
If there is enhancement in its value or quality, such as when something is added or attached to it.
What rule shall be applied when the thing is improved by nature or by time?
The improvement shall inure to the benefit of the creditor
What rule shall be applied when the thing is improved at the expense of the debtor?
The debtor will have the rights granted to a usufructuary , i.e., he can have enjoyment of the use of the improved thing and its fruits
He may remove the improvement if no damage is caused to the principal thing. If the improvement cannot be removed without causing damage to the principal thing, the thing and the improvement shall be delivered to the creditor without any right on the part of the debtor to indemnity. He may, however, set off against the improvements any damage caused on the thing. (Arts. 579 and 580)
D is obliged to give his only car to C if C finishes his economics degree. Before C finished the said degree, D had the car repainted. What would be the rule?
D can continue using the car in its improved condition
D is obliged to give his only car to C if C finishes his economics degree. Before C finished the said degree, D had the car repainted. In this case, D can continue using the car in its improved condition. Upon the completion by C of his economics degree, D cannot remove the paint because it will cause damage to the car. However, if he had caused a dent on the car due to his fault, what would be the rule?
He may set off the cost of damage brought by such dent against the cost of repainting the car
Article 1189 is only applied when
- The suspensive condition is fulfilled
- The object is specific/ determinate not generic
What are the three kinds of loss?
Physical, Legal, Civil
When a thing perishes as when a house is burned and reduced to ashes
Physical Loss
When a thing goes out of commerce or when a thing heretofore legal becomes illegal
Legal Loss
When a thing disappears in such way that its existence is unknown or even if known, it cannot be recovered is dropped from a ship at sea
Civil Loss
Rule in case of fulfillment of resolutory condition
- The obligation is extinguished
- The parties should return or restore to each other what they have received including the fruits and interest
- In rule 1189 will apply to whoever has got a duty to return in case of loss, deterioration or improvement of the thing.
- If the obligation is to do or not to do, the courts are given the power to determine the retroactivity of the fulfillment of the condition
Rights to rescind includes
- Only in reciprocal obligations
- It can be demanded only if the parties is ready, willing and able to comply with his own obligations and the other is not
- The right to rescind is implied
- The right is not automatic or absolute. Apply to the court for decree of rescission
When the object is not yet delivered
The contract states that either party can rescind - The remedies of the injured or aggrieved party are alternate and not cumulative
Rescission plus damages
Fulfillment of the obligation plus damages
What does Art. 1192 says?
In case both parties have committed a breach of the obligation, the liability of the first infractor shall be equitably tempered by the courts. If it cannot be determined which of the parties first violated the contract, the same shall be deemed extinguished, and each shall bear his own damages
Obligations that are future and certain or certain to happen
Obligations with a period
Obligations that are future and uncertain or may or may not happen
Conditional Obligations
Because it is future and certain that the day will come – The arrival of which will determine the demandability of the obligation
Suspensive Period
I will give you 20,000 on December 25,2023
What kind of obligation with a period is this?
Suspensive Period
The arrival of the condition will extinguish the obligation
Resolutory Period
I will give you a 10,000 monthly allowance until December 31,2024
What kind of obligation with a period is this?
Resolutory Period
A day certain, an exact date
Definite period
Something in the future but certain to happen (you do not known when that will happen)
Indefinite Period
What are the kinds of the period?
(1) Conventional/Voluntary – agreed upon by the parties
(2) Legal – provided by law
(3) Judicial – court fixes the period
You borrowed money from a friend, you agreed that you will pay two years from today. A year from now, you paid him 50,000 pesos probably thinking that two years have already lapsed. However, it is not yet due and demandable. Can you still get back the money you’ve paid in advance?
Yes, you can still get back the money you have paid because the period has not arrive yet. You can also get the interest.
In general rule, when there is a period, that period must benefit both the debtor and the creditor.
True or False?
True
A and B agreed that A will pay his debt on August 5, 2025. What is the benefit of the period here?
(a) The debtor cannot compel the creditor to accept payment before August 5,2025
(b) The creditor cannot compel the debtor to make payment before August 5,2025
Benefit of both because
If debtor pays in advance - you will be depriving the creditor of interest
If creditor compel his debtor to pay in advance – the debtor may not be ready to pay yet and it will be more burdensome on him. Nor can the creditor compel the debtor to pay after the period because it may be burdensome on the part of the debtor.
In general rule, when there is a period, that period must benefit both the debtor and the creditor. However, exception is when parties agree otherwise.
True or False?
True
A and B agreed that A will pay his debt on or before August 5, 2025. Who will benefit?
The debtor
because he has an option to either pay when the period arrives or to pay before the period arrives. The debtor can compel the creditor to accept the advance payment however the creditor cannot compel the debtor to pay before the period. The creditor has to wait for the period to arrive to demand payment.
If an obligation is due on or before a certain period, then the period is for the benefit of the DEBTOR.
The court may fix the period when
- If the obligation does not fix a period, but from its nature and circumstances it can be inferred that a period was intended
- When the duration of the period depends upon the will of the debtor
D is obliged to construct the mansion of C. However, no period was indicated in the agreement as to when D must complete the construction of the mansion. What will happen to the obligation?
Here, it is clear that a period was intended since the construction of the mansion will take some time to complete. C may thus go the court and ask it to fix the duration of the construction of the mansion.
Examples when the duration of the period depends upon the will of the debtor
a. “when my means permit me to do so
b. “little by little”
C. “as soon as I have the money”
d. “as soon as possible”
e. “in partial payments”
Means that the debtor can now be compelled to pay before the arrival of the period.
Debtor losses the benefit of the period
X and Y agreed that X will pay his debt on January 5, 2024.
What is the benefit?
X (DEBTOR) cannot be compelled by Y (CREDITOR) to pay before Jan 5,2024 (benefit of the debtor)
When will the debtor lose the benefit of the period?
- When debtor becomes insolvent
- Failure to furnish securities promised
- Impairment of securities
- Breach of contract
- Debtor attempts to abscond
Debts are more than his assets.
Insolvent
When debtor is insolvent (and if he fails to furnish a guaranty or a security), the creditor can now compel the debtor to pay before the arrival of the period.
True or False?
True
D borrowed P20,000.00 from C promising to pledge his ring to C to secure the debt within one month. C gave D one year to pay the loan. D, however, failed to pledge his ring within the period agreed upon. What is the remedy of the creditor?
In this case, C can demand immediate payment even before the agreed due date thereof.
D obtained a loan from C, the same being secured by a chattel mortgage on D’s car. The loan is payable within one year. On the seventh month, the car was razed by fire without D’s fault. What is the remedy of the creditor?
C can demand immediate payment unless D gives another security that is equally satisfactory. This is true even if the cause of the loss or impairment was not due to the fault of D.
C granted a loan of 50,000 to D giving D one year to pay provided D did not engage in any gambling until he has paid the debt. If D enters a casino to play in the slot machine, say after one month, what is the remedy of the creditor?
C can already demand immediate payment
If the debtor has been disposing all his property with an attempt to leave his place of business or residence to escape his creditors, what are the remedies of the creditor?
Such creditors can demand immediate payment of his debts although their maturity date is not yet due.
Is an obligation where there are several objects or prestations that are due, but such obligations may be complied with by the fulfillment of one of the objects or prestations.
Alternative Obligation
D obliged himself to deliver either a particular car over 300,000 or cash of 300,000 or a diamond ring worth 300,000. What is this obligation?
Alternative Obligation
Three objects are due, however the delivery of either of those objects would be enough to comply with the obligation.
Kinds of obligation where there is only one prestation
Simple Obligation
Kinds of obligation where there are several prestation
Compound Obligation
a. Conjunctive - Here, several prestations are due but all must be performed.
Example: D is to give C a specific ring, a specific watch and a specific bracelet to C. D must deliver all the items to C.
b. Distributive or disjunctive - This may either be alternative or facultative.
D cannot compel the creditor to receive 300,000 cash and the 300,000 car. Because the law says that it should be one of either the object or prestation that are due. It cannot be part of one and a part of the other. You cannot deliver part of one prestation and a part of another.
True or False?
True
Who has the right to choose which prestation will be fulfilled or which object will be delivered by the debtor?
The debtor, however, the debtor cannot choose those prestations which are impossible, unlawful or which could not have been the object of the obligation.
There is no particular form of choice. As long as the debtor communicated or informed the creditor of his choice.
True or False?
True
- When right of choice is with the debtor
a. If only one or some are lost through a fortuitous event or through the debtor’s fault, what will happen to the obligation?
The debtor may deliver any of the remainder, or that which remains if only one subsists.
- When right of choice is with the debtor
b. If all are lost through a fortuitous event, what will happen to the obligation?
The obligation is extinguished (based on the rule that no person shall be responsible for fortuitous event).
- When right of choice is with the debtor
C. If all are lost through the debtor’s fault, what will happen to the obligation?
The debtor shall pay the value of the last thing that was lost plus damages.
- When right of choice is with the debtor
d. If all except one are lost through the debtor’s fault, and the remaining item is subsequently lost through a fortuitous event, what will happen to the obligation?
Then the debtor’s obligation is extinguished.
- When right of choice is with the debtor
e. If all except one are lost through a fortuitous event, and the remaining item is subsequently lost through the debtor’s fault, what will happen to the obligation?
The debtor shall pay damages.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The obligation is silent as to who will choose the item to be delivered. Therefore, the right of choice belongs to D. If the ring is lost through a fortuitous event, what will happen to the obligation?
D may deliver the bracelet or the wristwatch.
The same rule applies if the ring is lost through the fault of D. In the case of the latter. D shall have no liability for damages because he can still perform his obligation by choosing to deliver the bracelet or the wristwatch
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The obligation is silent as to who will choose the item to be delivered. Therefore, the right of choice belongs to D. If the ring and the bracelet are lost through a fortuitous event or through D’s fault, what will happen to the obligation?
The obligation is converted into a simple obligation to deliver the wristwatch.
There is no liability for damages on the part of D even if the loss is due to his fault because he can still perform his obligation. It was as if D chose to deliver the wristwatch.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The obligation is silent as to who will choose the item to be delivered. Therefore, the right of choice belongs to D. If all things are lost due to a fortuitous event, what will happen to the obligation?
D’s obligation is extinguished.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The obligation is silent as to who will choose the item to be delivered. Therefore, the right of choice belongs to D. If the ring and the bracelet are lost through a fortuitous event and later on the wristwatch is thereafter lost due to the fault of D, what will happen to the obligation?
If the ring and the bracelet are lost through a fortuitous event, the obligation becomes a simple obligation to deliver the wristwatch.
If the wristwatch is thereafter lost due to the fault of D, D shall pay damages.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The obligation is silent as to who will choose the item to be delivered. Therefore, the right of choice belongs to D. If the ring, the bracelet and the wristwatch are lost one after the other due to D’s fault, what will happen to the obligation?
D shall pay the value of the wristwatch, the last item that was lost, plus damages.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The obligation is silent as to who will choose the item to be delivered. Therefore, the right of choice belongs to D. If the ring and the bracelet are lost through D’s fault, and later on the wristwatch is thereafter lost through a fortuitous event, what will happen to the obligation?
If the ring and the bracelet are lost through D’s fault, the obligation becomes a simple obligation to deliver the wristwatch.
If the wristwatch is thereafter lost through a fortuitous event, D’s obligation is extinguished.
- When right of choice is expressly granted to the creditor
a. If only one or some are lost through a fortuitous event, what will happen to the obligation?
The debtor shall deliver that which the creditor should choose from among the remainder, or that which remains if only one subsists.
- When right of choice is expressly granted to the creditor
b. If all are lost through a fortuitous event, what will happen to the obligation?
The obligation shall be extinguished.
- When right of choice is expressly granted to the creditor
c. If only one or some are lost through the debtor’s fault, what will happen to the obligation?
The creditor may claim any of those subsisting, or the price of any of those which were lost through the debtor’s fault plus damages
- When right of choice is expressly granted to the creditor
d. If all are lost through the debtor’s fault, what will happen to the obligation?
The creditor may claim the price of any of them plus damages.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The parties agreed that C shall have the right of choice. If the ring is lost through a fortuitous event, what will happen to the obligation?
D shall deliver either the bracelet or the wristwatch at the choice of C.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The parties agreed that C shall have the right of choice. If the ring is lost through a fortuitous event, what will happen to the obligation?
(X)
D’s obligation is extinguished.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The parties agreed that C shall have the right of choice. If the ring, and the bracelet are lost through a fortuitous event, what will happen to the obligation?
D shall deliver the wristwatch which is the remaining item. The obligation becomes a simple obligation to deliver the wristwatch.
If the wristwatch is thereafter lost due to D’s fault, D shall pay damages.
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The parties agreed that C shall have the right of choice. . If the ring and the bracelet are lost due to D’s fault, what will happen to the obligation?
The obligation does not become a simple obligation to deliver the wristwatch. C can still choose from the payment of the price of the ring or the bracelet with damages, or the delivery of the wristwatch
D is to give C a specific ring, a specific bracelet or a specific wristwatch. The parties agreed that C shall have the right of choice. If all are lost due to the fault of D, what will happen to the obligation?
C may claim the price of any of them plus damages
Obligation where only one prestation is due but the debtor may render another substitution
Facultative Obligation
D is obliged to give a specific ring to C with the agreement that D may deliver a specific watch as a substitute. What is this kind of obligation?
Facultative Obligation
Before substitution (i.e., before the debtor has informed the creditor of the substitution)
what will happened to the obligation if the loss of the principal thing is due to a fortuitous event?
The obligation is extinguished.
Before substitution (i.e., before the debtor has informed the creditor of the substitution)
what will happened to the obligation if the loss of the principal thing is due to the debtor’s fault?
Debtor shall pay damages.
Before substitution (i.e., before the debtor has informed the creditor of the substitution)
what will happened to the obligation if the loss of the substitute are whether through a fortuitous event or through the debtor’s fault?
No additional obligation on the debtor because it is not due. The debtor has still to deliver the principal thing.
However, the obligation ceases to be a facultative obligation and becomes a simple obligation to deliver the principal thing.
After substitution, what will happened to the obligation if the loss of the principal thing is whether through a fortuitous event or through the debtor’s fault?
no additional obligation on the debtor because the thing due is already the substitute. After the substitution has been communicated, the thing due is the substitute. The obligation also ceases to be a facultative obligation and becomes a simple obligation.
After substitution, what will happened to the obligation if the loss of the substitute is lost through a fortuitous event?
The obligation is extinguished.
After substitution, what will happened to the obligation if the loss of the substitute is lost through the debtor’s fault?
The debtor shall pay damages.
What kind of obligation?
Several prestations are due, but the performance of one is sufficient to extinguish the debt.
Alternative
What kind of obligation?
Only one prestation, the principal obligation, is due.
Facultative
What kind of obligation?
If there are void prestations, the others may still be valid, hence, the obligation remains.
Alternative
What kind of obligation?
If the principal obligation is void, the debtor is not required to give the substitute.
Facultative
What kind of obligation?
The right of choice is with the debtor, unless expressly given to the creditor.
Alternative
What kind of obligation?
The right of choice belongs to the debtor only.
Facultative
What kind of obligation?
If all prestations are impossible except one, that which is possible must still be given.
Alternative
What kind of obligation?
If the principal obligation is impossible, the debtor is not required to give the substitute
Facultative
There is a concurrence of two or more debtors and/or two or more creditors in one and the same obligation.
Joint or solidary obligation
Each debtor is liable only for a proportionate part of the debt, and each creditor is entitled only to a proportionate part of the credit.
Joint obligation
Each debtor is liable for the whole obligation, and each creditor is entitled to demand payment of the whole obligation.
Solidary obligation
A and B are indebted to X for 10,000.00. How payment is made?
A is liable only for 5,000
B is liable only for 5,000.00.
A owes X and Y 8,000.00. How payment is made?
X can collect only 4,000
Y can collect only 4,000
General rule in concurrence of two or more debtors and/or two or more creditors in one and the same obligation.
The obligation is presumed to be joint when there is a concurrence of two or more debtors and/or two or more creditors in one and the same obligation.
Exception in the general rule in concurrence of two or more debtors and/or two or more creditors in one and the same obligation.
- There is solidary liability only in the following cases:
1. When the obligation expressly so states
2. When the law requires solidarity.
Other terms for solidary obligation
- Jointly and severally
- Individually and collectively
- In solidum
- Mancomunada solidaria
- Juntos o separadamente
Other terms for joint obligation
- Proportionately
- Pro rata
- Mancomunada
- Mancomunada simple
What are the consequences of Joint liability?
- Vitiated consent on the part of one debtor do not affect the others
- Insolvency of one debtor does not make others responsible for his share.
- Demand by the creditor on one joint debtor puts him in default, but not the others since the debts are distinct.
P and G are joint debtors of B for the amount of 1,000 pesos. If P’s consent was obtained by fraud or through force or intimidation, what will happen to the obligation?
P will not be liable because his consent is through fraud. However, G will still be liable for 500. The amount of share of P and G’s between P and G’s obligations are distinct to each other. It will not affect the obligation of G.
Is an obligation where the debtors or creditors are jointly bound but the prestation or object is indivisible.
Joint Indivisible Obligation
Following characteristics of joint indivisible obligation
- The creditors must act collectively, meaning, all of them must make the demand unless one is specifically authorized to act for the others. A demand made by one or some but not all of the creditors will not be effective.
- The demand must be made against all the debtors since compliance is possible only if they act together.
- The right of the creditors may be prejudiced only by their collective acts. Thus, a renunciation made by a joint creditor extinguishes only his own share. The obligation, however, is converted into an obligation to pay the value of the thing. If all joint creditors make the renunciation, the obligation is extinguished.
- If one of the debtors does not comply with his undertaking, the obligation is converted into a monetary obligation to pay damages. The debtors who may have been ready to comply shall not contribute to the indemnity beyond the corresponding price of the thing or the value of the service in which the obligation consists. (Art. 1224)
- If one of the debtors is insolvent, the others shall not be liable for his share.
A, B and C are jointly indebted to deliver a specific car valued at P900,000.00 to X, Y and Z. X. Y and Z must make a demand against A, B and C for the delivery of the car. What will happen to the obligation if A is not ready to comply with his undertaking?
The obligation to deliver the car is converted into an obligation to pay its value plus damages. B and C shall be obliged to pay P300,000.00 each. A; the defaulting debtor, shall be liable for P300,000.00 plus damages.
A, B and C are jointly indebted to deliver a specific car valued at P900,000.00 to X, Y and Z. X. Y and Z must make a demand against A, B and C for the delivery of the car. What will happen to the obligation If A is insolvent?
B and C shall be liable only for their respective shares of P300,000.00 each.
A, B and C are jointly indebted to deliver a specific car valued at P900,000.00 to X, Y and Z. X. Y and Z must make a demand against A, B and C for the delivery of the car. What will happen to the obligation If X renounces his right to the obligation without the consent of Y and Z?
Then only his proportionate share is extinguished. The obligation, however, is converted into a monetary obligation to pay P600,000.00 which must be given to Y at P300,000.00 and Z at P300,000.00 by A, B and C who will give P200,000.00 each
Refers to the subject matter or the object of the obligation
and
Tie between the parties
Indivisibility and Solidary
What kind of obligation where:
A and B are jointly obliged to C to construct a pavement 2 meters wide and 10 meters long.
Joint divisible obligation
What kind of obligation where:
A and B are jointly obliged to give a specific horse to C.
Joint indivisible obligation
What kind of obligation where:
A and B are solidarily liable to pay C P10,000.00 in two equal installments.
Solidary divisible obligation
What kind of obligation where:
Example; A and B are solidarily liable to give a specific horse to C.
Solidary indivisible obligation
This is solidarity on the part of the debtors.
Passive solidarity
This is solidarity on the part of the creditors.
Active solidarity
Solidarity on the part of both debtors and creditors
Mixed
A and B, solidary debtors, are indebted to X for P10,000.00. X can demand payment of P10,000.00 from either A or B. If A pays X P10,000.00, what will happen to the obligation?
The obligation is extinguished. A can demand reimbursement of P5,000.00 from B representing the latter’s share in the debt.
A owes X and Y, solidary creditors, P8,000.00. Either X or Y may demand payment of P8,000.00 from A. If A pays X P8,000.00, what will happen to the obligation?
The obligation is extinguished. X must give P4.000.00 to Y representing the latter’s share in the credit
A and B, solidary debtors, owe X and Y, solidary creditors, P12,000.00. X or Y may collect from A or B the total sum of P12,000.00. If A pays X P12,000.00, what will happen to the obligation?
The obligation is extinguished. B must reimburse A P6,000.00. On the other hand, X must give P6,000.00 to Y.
A, B and C are solidarily liable to X for 9,000. The parties stipulated that the share of A is payable on demand; the share of B on Christmas day next year, and the share of C. if X passes the Bar Examination. How can the creditors demand payment?
X may demand payment of the share of A of 3,000 anytime from either A, B or C. On Christmas day next year, X may demand payment of the share of B of 3,000 from either A, B or C. When X passes the Bar Examination, he may demand payment of the share of C of 3,000 from either A, B or C
Each one of the solidary creditors may do whatever may be useful to the others, but not anything which may be prejudicial to the latter.
True or False?
True
Solidary creditor cannot assign is the general rule
True or False?
True
Solidary creditor cannot assign is the general rule but the exception is when it has the other creditor’s consent
True or False
True
P is obliged to give 100,000 to solidary creditors B, I, and M on Dec 25,2020. If on Dec 20,2020, B assign her right to D (third party). Can D collect the obligations?
D cannot collect the obligations on due date because the assignment is invalid.
P is obliged to give 100,000 to solidary creditors B, I, and M on Dec 25,2020. If on Dec 20,2020, B assign her right M. Can M collect the obligations?
Yes, because M is her co-creditor.
P is obliged to give 100,000 to solidary creditors B, I, and M on Dec 25,2020. If on Dec 20,2020, B assign her right to D (third party). If P paid the 100,000 to D, what will happen to the obligation?
The obligation will not extinguished. P can recover the payment to D because of the rule of Solutio Indebiti, no one shall be unjustly enriched at the expense of the other.
A is indebted to X, Y and Z, solidary creditors, for 24,000. Suppose X makes a demand against A, to whom shall A pay?
A must pay to X.
If A pays to another solidary creditor, say Y, the sum of P24,000.00, the payment, as a rule, is valid only with respect to Y’s share of P8,000.00. Thus, if X and Z do not receive their respective shares from Y, A can still be held liable for 16,000.
A and B are solidary debtors of X and Y, solidary creditors, in the amount of 20,000. If X renounces or remits the whole obligation without the consent of Y, will the obligation be extinguished?
Yes, because the remission made by any solidary creditor extinguishes the whole obligation. (Art. 1215)
However X has to give Y’s share of 10,000 since a solidary creditor may not do anything prejudicial to his co-solidary creditors. (Art. 1212) A solidary creditor who has caused the extinguishment of the obligation by remission, novation, compensation or confusion, or who has collected the debt, shall be liable to the others for the shares corresponding to them.
A, B and C, solidary debtors, borrowed P30,000.00 from X. The obligation is evidenced by a promissory note signed by the debtors. X demands payment from A. However, A pays only 12,000. May X still go after B and/or C?
Yes, X may still go after B or C or both of them for the balance of 18,000.
The creditor may proceed against any one of the solidary debtors or some or all of them simultaneously. The demand made against one of them shall not be an obstacle to those which may subsequently be directed against the others, so long as the debt has not been fully collected.
A, B and C, solidary debtors, borrowed P30,000.00 from X. The obligation is evidenced by a promissory note signed by the debtors. If A pays X P30,000.00, what are the rights of A?
A can demand reimbursement from B and C at P10.000.00 each together with interest from the date of payment.
However, if payment is made by A before due date, he cannot collect interest during the intervening period, i.e., from date of payment to due date.
A, B and C, solidary debtors, borrowed P30,000.00 from X. The obligation is evidenced by a promissory note signed by the debtors. A pays X P30,000.00. However, C has become insolvent. How much may A demand from B as reimbursement?
A may demand P15,000.00 from B.
If an insolvent debtor cannot reimburse his share to the debtor who paid the obligation, such share shall be borne by all his co-debtors, in Proportion to the debt of each. Thus, A and B shall bear C’s share at P5,000.00 each.
What are the instances when paying debtor cannot reimbursed the payment?
a. when the obligation has prescribed
b. become illegal
A, B and C, solidary debtors, borrowed P30,000.00 from X. The obligation is evidenced by a promissory note signed by the debtors. If A pays X P30,000.00 more than 10 years after the note had become due, can he still demand reimbursement from B and C?
No, he can no longer demand reimbursement.
Payment by a solidary debtor after the obligation has prescribed does not entitle him to reimbursement.
The same rule applies if payment is made after the obligation has become illegal. (Art. 1218).
(Note: An action based on a written contract prescribes in 10 years, i.e., payment can no longer be enforced by court action.
A and B are solidary debtors of X and Y, solidary creditors, in the amount of 20,000.
3. Suppose that X renounces or remits A’s share amounting to 10,000.00. However, it turned out that B had already paid 20,000.00 to Y two days before. May B still collect 10,000.00 from A representing A’s share?
Yes, B may still collect from A 10,000.
The remission made by the creditor of the share which affects one of the solidary debtors does not release the latter from responsibility to his co-debtors, in case the debt has been totally paid by anyone of them before the remission was effected.
A’s remedy will be to go after X or Y to collect the sum he paid to B.
Ex: A and B are solidary debtors of X and Y, solidary creditors, in the amount of 20,000. Suppose the remission of the whole obligation was obtained by A, may A demand reimbursement from B?
No, because the remission of the whole obligation obtained by one of the solidary debtors does not entitle him to reimbursement from his co-debtors (Art 1220)
Remission being the gratuitous abandonment by the creditors of their rights to the obligation
P and G are solidary obliged to give B a particular car. The car was lost due to fortuitous event, and without any fault on the part of the debtors. What happens to the obligation?
THE OBLIGATION WILL BE EXTINGUISHED
P and G are solidary obliged to give B a particular car. Suppose, the car was lost through the fault of P, and B makes a demand later upon G, should G be liable for the price of the car?
YES, because they are solidarily obliged
However, G can later collect the whole amount of what she had paid
P and G are solidary obliged to give B a particular car. Later, B already makes an extra-judicial demand upon P, but after the demand, the car was lost through a fortuitous event, is the obligation extinguished?
NO
G can recover payment of what she had paid because when P had not been at fault, the obligation should be extinguished
P and G are solidary indebted to B for 1M. But P’s consent was obtain through force and intimidation. If B files and action against P, how much can she get from P? (PARTIAL DEFENSE)
Nothing, for as to P, he has a complete defense.
P and G are solidary indebted to B for 1M. But P’s consent was obtain through force and intimidation. Now, if B files an action against G, how much can B get?
G can still be liable for 500,000
Is one capable of partial performance
Divisible Obligation
Is one not capable of partial performance
Indivisible Obligation
Divisible or Indivisible Obligations?
- Obligations to give definite things (such as the obligation to give a specific horse).
- Execution of a certain number of days of work
- By metrical units (such as the obligation to construct a pavement which is 10 meters long and 2 meters wide).
- Those not susceptible of partial performance (such as the obligation of a singer to sing one song in a program).
- Obligation to pay a sum of money but the law provides that the sum must be paid in full as in the case of certain taxes
- Analogous things which by their nature are susceptible of partial performance.
- Obligation is to pay a sum of money but the parties agreed that the sum must be paid in full
- Indivisible
- Divisible
- Divisible
- Indivisible
- Indivisible
- Visible
- Indivisible
In joint obligations, if one debtor incurs delay, the other joint debtors is liable for damages.
True or False?
False
If one of solidary debtors incurs delay, other solidary debtors are not liable for damages.
True or False?
False
A and B bound themselves jointly to deliver a particular car to X, If B becomes insolvent what happens to the obligation?
A cannot be made liable for B’s share.
A and B bound themselves jointly to deliver a particular car to X, I If B incurs a delay, what happens to the obligation?
A will not be liable for damages.
A and B bound themselves jointly to deliver a particular car to X. Supposing that the debt is now due and demandable. The agreement of when they will deliver it has already arrive and X now demands the delivery of that particular car. A is willing to comply, but B refuses to comply. If A and B cannot deliver the car because of B’s non-compliance, can A be made liable for damages?
NO, A cannot be made liable for the damages because he was ready and willing to fulfill his obligation. Art.1224, 2nd parag
Only B will be liable for damages
A and B bound themselves jointly to deliver a particular car to X. Supposing that the debt is now due and demandable. The agreement of when they will deliver it has already arrive and X now demands the delivery of that particular car. A is willing to comply, but B refuses to comply. If A and B cannot deliver the car because of B’s non-compliance, What happens now to the obligation?
The obligation is convert into a monetary obligation
The debtor who was willing shall only pay the corresponding portion of the price of the thing. Art. 1224 2nd parag
If the car is worth 2M, then A will only be liable to pay 1M. But B shall be liable to pay his corresponding portion of the price of the thing PLUS DAMAGES.
It is an obligation with ACCESSORY UNDERTAKING that if the debtor fails to comply, he will be liable to pay a penalty.
Obligations with a Penal Clause
D is obliged to construct a commercial building for C within a period of three months. The parties agreed that should D fail to finish the construction of the building within the said period, D shall pay to C P1,000.00 for every day of delay as penalty.
What is this kind of obligation?
Obligations with a Penal Clause
What is the purpose of penalty?
- To ensure performance
– discourages the debtor from not fulfilling his obligation. Bacause his obligation now becomes burdensome to the penalty. - To liquidate damages
- that is suffered by injured party due to the non- fulfillment of the debtor to his obligation - To punish the debtor for failing to comply his obligation
Can the debtor exempt himself from fulfilling the obligation by just paying the penalty?
NO, the debtor cannot exempt himself from the performance of the obligation by paying the penalty, save in the case where this right has been expressly rerserved for him. Art. 1227
General rule in penalty is that he cannot just pay the penalty so that he will not fulfill his obligation.
True or False?
True
Exception to the general rule in penalty is that he can just pay the penalty so that he will not fulfill his obligation if that right has been granted to him.
True or False?
True
Can creditor demand the fulfillment of the obligation plus payment of the penalty?
NO, neither can the creditor demand the fulfillment of the obligation and the satisfaction of the penalty at the same time, unless the right has been clearly granted to him. Art. 1227
Creditor cannot demand for the fulfillment of the obligation PLUS the penalty is a general rule. True or False?
True
Creditor can demand for the fulfillment of the obligation PLUS the penalty if both parties agreed is the exception to the general rule. True or False?
True
If it is without the fault of the creditor and the obligation cannot anymore be fulfilled, then it’s his right to enforce the penalty.
Now, suppose that the debtor fails to fulfill his obligation and now the creditor is now enforcing the penalty as his rights. Can the debtor refuse to pay the penalty for failure by the creditor to prove that he suffered damages?
NO, proof of actual damages suffered by the creditor is not necessary in order that the penalty may be demanded. Art. 1228 This means that what the creditor needs to prove is that the debtor failed to fulfill his obligation. Thus, creditor need not prove that he suffered damages from the non-fulfillment of the debtor.
Courts may reduce the penalty if:
- Irregular or incomplete fulfillment
- Penalty is unconscionable
- depends on the circumstances of each case. Each case is unique when we talk about penalty.
- it will now have to be exercised by reasonable discretion by the court.
If the principal obligation is void, then the accessory obligation is void.
If the accessory obligation is void, it will not affect the principal obligation.
True or False?
True
Why is principal important in obligation with a penal clause?
It is important because a penal clause is an accessory undertaking. A penal clause is an accessory obligation. Such that if the principal obligation is void, then the penalty is void. If the penalty is void, then the principal obligation subsists.
D is obliged to deliver 10 sacks of rice to C on May 10. The parties agreed that if D fails to deliver on due date, he will pay a penalty of P500.00. Supposing that D failed to deliver on due date, may he just pay the penalty of P500.00?
No, because the debtor cannot exempt himself from the performance of the obligation by just paying the penalty, except when this right has been expressly reserved for him. (Art.1227)
D is obliged to deliver 10 sacks of rice to C on May 10. The parties agreed that if D fails to deliver on due date, he will pay a penalty of P500.00. Supposing that D failed to deliver on due date, may C demand the delivery of 10 sacks of rice and the payment of the penalty at the same time upon default of D?
No. The creditor cannot demand fulfillment of the obligation and the payment of the penalty at the same time except when this right has been clearly granted to him. or if after requiring fulfillment of the obligation, the performance thereof becomes impossible without his fault, he may also enforce the penalty. (Art. 1227)
