Contracts Flashcards
What is a contract?
Under Article 1305, a contract is a meeting of the minds between two persons whereby one binds himself, with respect to the other, to give something or render some service.
What are the essential elements of a contract?
Under Article 1306, the three essential elements of a contract are:
(1) Consent of the contracting parties
(2) Object certain which is the subject matter of the contract
(3) Cause of the obligation which is the reason why the contract is established
On real contracts, an additional element is the delivery of the thing.
On formal contracts, an additional element is the formal signing of a public document.
On the second essential element, which is the object certain, what are the valid objects of a contract?
Among the valid objects of a contract are, (1) a thing within the commerce of man, (2) rights that are transmissible, and (3) services that are not contrary to law, good customs, good morals, public order, and public policy.
On the third element, which is the cause of the obligation, what are the three kinds of contracts in terms of its cause?
The kinds of contracts in terms of its cause are:
(1) Onerous - Where each of the contracting parties parts a thing of value, and the cause or consideration of the contract is the promise or prestation of the other.
(2) Gratuitous - Where only one of the contracting parties parts a thing of value, and the cause or consideration of the contract is the liberality of the contracting parties.
(3) Remunerative - Where a service is rendered, and in consideration of such service, the other party pays for it and the cause or consideration of the contract is the service rendered or the benefit received from such service.
What are the stages in the life of a contract?
The first stage is the negotiation stage, where each party is given the freedom to stipulate any terms or conditions, provided that those terms or conditions is not contrary to law, morals, good customs, public policy, and public order.
The second stage is the perfection stage, where there is a meeting of the minds of the parties, or there is consent between the two contracting parties which involves a meeting of the offers and acceptance regarding the offer, cause, or consideration.
The third stage is the termination stage, where the contracting parties have complied with the obligations arising from the contract.
What are the kinds of contracts according to its perfection?
The kinds of contracts according to its perfection are:
(1) Consensual - the contract requires the agreement of contracting parties.
(2) Real - the contract requires the delivery of the object certain by any party to the other, but this also requires the consent of the other.
(3) Formal/Solemn - the contract requires signing of a public document
What are the kinds of contracts according to their importance or relation to other contracts?
The kinds of contracts according to their importance or relation to other contracts are:
(1) Principal - it is the kind of contract that can subsist independently from the other contracts, and its purpose can be fulfilled by itself.
(2) Accessory - it is the kind of contract that can exist only as a consequence of or in relation with another contract.
(3) Preparatory - it is the kind of contract which the object of the contract is the establishment of a condition in law which is necessary as a preliminary step towards the celebration of another contract.
What are the kinds of contracts according to the parties obligated?
The kinds of contracts according to the parties obligated are:
(1) Unilateral - a contract where only one party is obligated.
(2) Bilateral - a contract which gives rise to reciprocal obligation for both parties.
What are the kinds of contracts according to their name or norms regulating them? How is the second kind regulated?
The kinds of contracts according to their name or norms regulating them:
(1) Nominate - A contract given with a particular or special name, has their own individuality, and regulated by special provisions of law.
(2) Innominate - A contract not given with any special names, do not have their own individuality, and not regulated by special provisions of law.
Under Article 1307, the stipulations of the parties, Titles I and II of Contracts, Rules governing the most analogous nominate objects, and customs of the place governs innominate objects.
What are the kinds of innominate contracts?
The kinds of innominate contracts are:
(1) Do ut des - I give, you give
(2) Do ut facias - I give what you do
(3) Facio ut des - I do that you give
(4) Facio ut facias - I do that you do
What are the kinds of contracts according to the risk of fulfillment?
The kinds of contracts according to the risk of fulfillment are:
(1) Commutative - a kind of contract where each of the parties acquires an equivalent of his prestation and the equivalent is already determined from the moment of the celebration of contract. (Example, Contract of Lease)
(2) Aleatory - a kind of contract where the parties have to account of an equivalent of his prestation, and such equivalent is not yet determined from the moment of the celebration of the contract since it depends upon the happening of an uncertain event. (Example, Contract of Insurance)
What are the kinds of contracts according to their time or performance?
The kinds of contracts according to their time or performance are:
(1) Executed - the parties have already performed their obligations or fulfilled their promises as specified in the agreement.
(2) Executory - the parties are yet to perform their obligations and duties arising from the contract.
What are the kinds of contracts according to subject matter?
The kinds of contracts according to subject matter are:
(1) Things - a contract involving things
(2) Rights or Credits - a contract involving rights or credits (as long as transmissible)
(3) Carriage
What are the kinds of contracts according to obligations imposed and regarded by law?
The kinds of contracts according to obligations imposed and regarded by law are:
(1) Ordinary
(2) Institutional
What are the basic characteristics of a contract?
The basic characteristics of a contract are:
(1) Autonomy of Contracts (Article 1306)
(2) Obligatory force and compliance in good faith (Article 1159 and Article 1315)
(3) Consensuality of Contracts (Article 1315)
(4) Mutuality of Contracts (Article 1308)
(5) Relativity principle (Article 1311)
What is the principle of autonomy of contracts?
Under Article 1306, the contracting parties are free to stipulate whatever terms, conditions, and clauses provided that what they stipulated are not contrary to law, morals, good customs, public policy, and public order.
The contracting parties are bound by what they have stipulated, as the contract has the force of law.
What is the principle of mutuality of contracts?
Article 1308 provides that the contract, once perfected, binds the contracting parties. Its validity and compliance cannot be left to the will of one of them.
What is the principle of relativity of contracts?
Under Article 1311, the general rule is that contracts takes effect only between the parties, their assigns and heirs.
The exception to the rule are the rights and obligations arising from the contract are not transmissible by (1) their nature, (2) by stipulation, (3) by provision of law.
