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for SF 2 Flashcards

1
Q

MODES OF EXTINGUISHMENT OF OBLIGATIONS

A

Payment or Performance
Loss of the thing due
Condonation or remission of debt
Confusion or merger of rights
Compensation
Novation

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2
Q

delivery of money and performance, in any other manner of the obligation

A

PAYMENT / PERFORMANCE

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3
Q

Requisites for Valid Payment / Performance

A

With respect to the prestation
Identity
Integrity or completeness
Indivisibility

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4
Q

REQUISITES FOR VALID PAYMENT

A

With respect to parties - must be made by proper party to proper party.

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5
Q

the one performing, he can be the debtor himself or his heirs or assigns or his agent, or anyone interested in the fulfillment of the obligation; can be anyone as long as it is with the creditor’s consent.

A

Payor

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6
Q

only the creditor’s consent; If performance is done also with debtor’s consent - he takes the place of the debtor.

A

3rd person pays/performs

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7
Q

There is ___ except if the 3rd person intended it to be a donation.

A

subrogation

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8
Q

3rd person pays/performs with consent of creditor but not with debtor’s consent, the repayment is only to the extent that the payment has been beneficial to ___.

A

debtor

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9
Q

REQUISITES FOR VALID PAYMENT

A

3rd person - if any of the ff. concur:
It must have redounded to the obligee’s.
benefit and only to the extent of such benefit.
It falls under article 1241 - the benefit is total so performance is total.

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10
Q

creditor or obligee or successor in interest of transferee, or agent.

A

Payee

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11
Q

Anyone in possession of the credit - but will apply only if debt has not been
previously garnished.

A

REQUISITES FOR VALID PAYMENT

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12
Q

Payment made to an Incapacitated Person, VALID if:

A

Incapacitated person kept the thing delivered, or
Insofar as the payment has been beneficial to him

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13
Q

AYMENT TO 3RD PARTY NOT AUTHORIZED, VALID IF PROVED AND ONLY TO
THE EXTENT OF BENEFIT; PRESUMED IF

A

After payment, 3rd person acquires the creditor’s rights.
Creditor ratifies payment to 3rd person.
By creditor’s conduct, debtor has been led to make the payment (estoppel)

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14
Q

PAYMENT MADE IN GOOD FAITH TO A PERSON IN POSSESSION OF CREDIT SHALL RELEASE DEBTOR; REQUISITES:

A

Payment by debtor must be made in good faith.
Creditor must be in possession of the credit and not merely the evidence of
indebtedness

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15
Q

WHERE PAYMENT MADE

A

In the place designated in the obligation.
If there is no express stipulation and the undertaking is to deliver a specific thing at the place where the thing might be at the moment the obligation was constituted.

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16
Q

In other case - in the place of the domicile of the debtor.

A

Time of payment - time stipulated.
Effect of payment extinguish obligation Except: order to retain debt

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17
Q

SUBSTANTIAL PERFORMANCE: Article 1234

A

Article 1234. If the obligation has been substantially performed in good faith, the obligor may recover as though there had been astrict and complete fulfillment, less damages suffered by the obligee.

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18
Q

SUBSTANTIAL PERFORMANCE: Article 1235

A

Article 1235. When the obligee accepts the performance, knowing its in completeness or irregularity, and without expressing any protestor objection, the obligation is deemed fully complied with.

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19
Q

SUBSTANTIAL PERFORMANCE

A

Attempt in Good Faith to perform without willful or intentional departure
Deviation is slight
Omission/Defect is technical or unimportant
Must not be so material that intention of parties is not attained

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20
Q

Effect of Substantial Performance in Good Faith

A

Obligor may recover as though there has been strict and complete fulfillment, less
damages suffered by the obligee
Right to rescind cannot be used for slight breach

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21
Q

APPLICATION OF PAYMENTS

A

the designation of the debt which payment shall be made, out of 2 or more debts
owing the same creditor
stipulation or application of party given benefit of period - OK
to be valid: must be debtor’s choice or with the consent of debtor

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22
Q

Requisites:
APPLICATION OF PAYMENTS

A

Various debts of the same kind
Same debtor
Same creditor
All debts must be due

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23
Q

Exceptions:
there may be application of payment even if all debts are not yet due if

A

Parties so stipulate
When application of payment is made by the party for whose benefit the term has
been constituted
Payment is not enough to extinguish all debts

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24
Q

HOW APPLICATION IS MADE

A

Debtor makes the designation
If not, creditor makes it by so stating in the receipt that he
issues - unless there is cause for invalidating the contract
If neither the debtor nor creditor has made the application
or if the application is not valid, then application, is made by
operation of law

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25
WHO MAKES APPLICATION OF DEBTS? GR: Debtor Exceptions: Creditor
Debtor without protest accepts receipt in which creditor specified expressly and unmistakably the obligation to which such payment was to be applied - debtor in this case renounced the right of choice When monthly statements were made by the bank specifying the application and the debtor signed said statements approving the status of her account as thus sent to her monthly by the bank
26
In case no application is made:
Apply payment to the most onerous If debts are of the same nature and burden, application shall be made to all proportionately
27
mode of extinguishing an obligation whereby the debtor alienates in favor of the creditor property for the satisfaction of monetary debt
DACION EN PAGO
28
extinguish up to amount of property unless there is a contrary stipulation
DACION EN PAGO
29
a special form of payment because 1 element of payment is missing: IDENTITY
DACION EN PAGO
30
CONDITIONS FOR A VALID DACION
If creditor consents, for a sale presupposes the consent of both parties If dacion will not prejudice the other creditors If debtor is not judicially declared insolvent
31
Dacion en pago is governed by the ___.
Law on Sales
32
the process by which debtor transfer all the properties notsubject to execution in favor of creditors is that the lattermay sell them and thus, apply the proceeds to their credits
CESSION/ASSIGNMENT IN FAVOR OF CREDITORS
33
extinguish up to amount of net proceeds (unless with a contrary stipulation)
CESSION / ASSIGNMENT
34
Kinds of Assignment:
Legal. Voluntary
35
ASSIGNMENT, governed by the insolvency law
Legal
36
ASSIGNMENT, agreement of creditors
Voluntary
37
Requisites of Voluntary Assignment:
More than one debt More than one creditor Complete or partial insolvency of debtor Abandonment of all debtor’s property not exempt from execution Acceptance or consent on the part of the creditors
38
EFFECTS OF ASSIGNMENT
Creditors do not become the owner; they are merely assignees with authority to sell Debtor is released up to the amount of the net proceeds of the sale, unless there is a stipulation to the contrary Creditors will collect credits in the order of preference agreed upon, or in default of agreement, in the order ordinarily established by law
39
Dacion
One creditor Not necessarily in state of financial difficulty Thing delivered is considered as equivalent of performance Payment extinguishes obligation to the extent of the value of the thing delivered as agreed upon, proved or implied from the conduct of the creditor
40
Cession in Payment
Plurality of creditors Debtor must be partially or relativelyinsolvent Universality of property of debtor iswhat is ceded Merely releases debtor for net proceeds of things ceded of, assigned, unless there is a contrary intention
41
the act of offering the creditor what is due himtogether with a demand that the creditor accept the same (When creditor refuses w/o just cause to accept payment, hebecomes in mora accepiendi and debtor is released from responsibility if he consigns the thing or sum due)
TENDER
42
the act of depositing the thing due with the court or judicial authorities whenever the creditor cannot accept or refuses to accept payment; generally requires prior tender of payment
CONSIGNATION
43
REQUISITES FOR VALID CONSIGNATION
Existence of valid debt Consignation was made because of some legal cause - previous valid tender was unjustly refused or circumstances making previous tender exempt Prior Notice of Consignation had been given to the person interested in performance of obligation (1st notice) Actual deposit / Consignation with proper judicial authorities Subsequent notice of Consignation (2nd notice)
44
EFFECTS OF CONSIGNATION
Debtor may ask judge to order cancellation of obligation Running of interest is suspended Before creditor accepts or before judge declares consignation has been properly made, obligation remains (debtor bears risk of loss at the meantime, after acceptance by creditor orafter judge declares that consignation has been properlymade - risk of loss is shifted to creditor)
45
CONSIGNATION WITHOUT PRIOR TENDER
Allowed when: Creditor absent or unknown/ does not appear at the place of payment Incapacitated to receive payment at the time it is due Refuses to issue receipt w/o just cause 2 or more creditor claiming the same right to collect Title of obligation has been lost
46
LOSS OF THE THING DUE
partial or total / includes impossibility of performance When there is loss: When the object perishes (physically) When it goes out of commerce When it disappears in such a way that: its existence is unknown or it cannot be recovered
47
IMPOSSIBILITY OF PERFORMANCE
Physical impossibility
48
IMPOSSIBILITY OF PERFORMANCE, Legal impossibility
Directly - caused as when prohibited by law Indirectly - caused as when debtor is required to enter a military draft
49
LOSS Obligation to deliver a SPECIFIC thing GENERAL RULE: Extinguished
EXCEPTIONS: Debtor is at fault Debtor is made liable for fortuitous event because of a provision of law, contractual stipulation or the nature of the obligation requires assumption of risk on part of debtor
50
Obligation to deliver a GENERIC thing GENERAL RULE: Not extinguished
EXCEPTIONS: If the generic thing is delimited If the generic thing has already been segregated Monetary obligation
51
LOSS, Obligation TO DO
GENERAL RULE: Debtor is released when prestation becomes legally or physically impossible without fault on part of debtor
52
EFFECTS OF PARTIAL LOSS
When loss is significant - may be enough to extinguish obligation When loss insignificant - not enough to extinguish obligation NOTE: Judicial determination of extent is necessary
53
When loss is significant -
may be enough to extinguish obligation
54
When loss insignificant -
not enough to extinguish obligation
55
WHEN THING IS LOST IN THE POSSESSION OF THE DEBTOR
Presumption: Loss due to debtor’s fault (disputable) Exception: natural calamity, earthquake, flood, storm
56
REBUS SIC STANTIBUS
agreement is valid only if the same conditions prevailing at time of contracting continue to exist at the time of performance obligor may be released in whole or in part based on this ground
57
REQUISITES: REBUS SIC STANTIBUS
The event or change could not have been foreseen at the time of the execution of the contract The performance is extremely difficult, but not impossible (because if it is impossible, it is extinguished by impossibility) The event was not due to the act of any of the parties The contract is for a future prestation
58
CONDONATION / REMISSION
Gratuitous abandonment of debt If donation, rules on donation apply May be express or implied
59
REQUISITES: CONDONATION
There must be an agreement There must be a subject matter (object of the remission, otherwise there would be nothing to condone) Cause of consideration must be liberality (Essentially gratuitous, an act of liberality ) Parties must be capacitated and must consent; requires acceptance by obligor; implied in mortis causa and expressed inter vivos Formalities of a donation are required in the case of anexpress remission Revocable - subject to rule on inofficious donation (excessive, legitime is impaired ) and ingratitude and condition not followed Obligation remitted must have been demandable at the time of remission Waivers or remission are not to be presumed generally
60
CONDONATION / REMISSION
FORMS EXTENT KINDS Express - must follow formalities of donation Implied - conduct is sufficient Total Partial Principal - accessory is also condoned Accessory - principal is still outstanding
61
presumption; when evidence of indebtedness is with the debtor - presumed voluntarily delivery by creditor (rebuttable)
Voluntary delivery
62
Effect of delivery of evidence of indebtedness: debt is already condoned (conclusion)
If in hands of joint debtor - only his share is condoned If in hands of solidary debtor - whole debt is condoned Tacit - voluntary destruction of instrument by creditor; madeto prescribe w/o demanding
63
CONFUSION / MERGER
Character of debtor and creditor is merged in same person with respect to same obligation
64
Requisites: CONFUSION / MERGER
It must take place between principal debtor and principal creditor only Merger must be clear and definite The obligation involved must be same and identical - one obligation only Revocable, if reason for confusion ceases, the obligation is revived
65
COMPENSATION
Set off It is a mode of extinguishment to the concurrent amount the obligation of persons who are in their own right reciprocally debtors or creditors
66
REQUISITES: COMPENSATION
Both parties must be mutually creditors and debtors - in their own right and as principals Both debts must consist in sum of money or if consumable of the same kind or quality Both debts are due Both debts are liquidated and demandable (determined) Neither debt must be retained in a controversy commenced by 3rd person and communicated w/ debtor (neither debt is garnished)
67
KINDS OF COMPENSATION
Legal Conventional Facultative Judicial Total Partial
68
- by operation of law; as long as 5 requisites concur - even if unknown to parties and if payable indiff places; indemnity for expense of exchanges; even if not equal debts - only up to concurring amount
Legal
69
agreement of parties is enough, forget other requirement as long as both consented
Conventional
70
one party has choice of claiming/opposing one who has benefit of period may choose to compensate: Not all requisites are present Depositum; commodatum; criminal offense; claim for future support; taxes
Facultative
71
set off; upon order of the court; needs pleading and proof; all requirements must concur except liquidation
Judicial
72
when 2 debts are of the same amount
Total
73
- when 2 debts are not of the same amount
Partial
74
EFFECT OF ASSIGNMENT OF CREDIT TO A 3RD PERSON
If made after compensation took place - no effect; compensation already perfected If made before compensation took place - it depends: With consent of debtor - debtor is estopped unless he reserves his right and gave notice to assignee With knowledge but w/o consent of debtor - compensation may be set up as to debts maturing prior to assignment Without knowledge - compensation may be set-up on all debts prior to his knowledge
75
NOVATION
Extinguishment of obligation by creating/ substituting anew one in its place Changing object or principal conditions Substituting person of debtor Subrogating 3rdperson in right of creditor
76
REQUISITES: NOVATION
Valid obligation Intent to extinguish old obligation - expressed or implied: completely/substantially incompatible old and new obligation on every point Capacity and consent of parties to the new obligation Valid new obligation
77
EFFECTS OF NOVATION
Extinguishment of the principal carries the accessory, except: Stipulation to contrary Stipulation pour autrui unless beneficiary consents Modificatory novation only; obliged to which is less onerous Old obligation is void Old obligation subsists if new obligation is void or voidable but annulled already (except: intention of parties) If old obligation has condition If Resolutory and it occurred - old obligation already extinguished; no new obligation since nothing to novate
78
EFFECTS OF NOVATION
If old obligation has condition, must be compatible with the new obligation; if new is w/o condition - deemed attached to new If new obligation has condition If resolutory: valid If suspensive and did not materialize: old obligation is enforced
79
KINDS OF NOVATION
REAL / OBJECTIVE PERSONAL / SUBJECTIVE Substituting person of debtor (passive) PERSONAL / SUBJECTIVE Substituting person of debtor (passive)
80
EXPROMISION;
initiative is from 3rd person or new debtor; new debtor and creditor to consent; old debtor released from obligation; subject to full reimbursement and subrogation if made w/ consent of old debtor; if w/o consent or against will, only beneficial reimbursement; if new debtor is insolvent, not responsible since w/o his consent
81
DELEGACION:
initiative of old debtor; all parties to consent;full reimbursement; if insolvent new debtor - not responsibleold debtor because obligation extinguished by valid novationunless: insolvency already existing and of public knowledgeor know to him at time of delegacion
82
Delegante, Delegatario , Delegado
Delegante - old debtor Delegatario - creditor Delegado - new debtor
83
KINDS OF NOVATION
PERSONAL / SUBJECTIVE Subrogating 3rd person to rights of creditor (active) Conventional - agreement and consent of all parties; clearly established Legal - takes place by operation of law; no need for consent; not presumed except as provided for in law: PRESUMED WHEN Creditor pays another preferred creditor even w/o debtor’s knowledge 3rd person not interested in obligation pays w/ approval of debtor Person interested in fulfillment of obligation pays debt even w/o knowledge of debtor
84
Novation
Difference from Payment by 3rd Person Change of Debtor Debtor is not necessarily released from debt Can be done without the consent of the creditor One obligation 3rd person has no obligation to pay if insolvent Debtor is released Needs consent of the creditor - express or implied Two obligations - one is extinguished and the new one created New debtor is obliged to pay

LAW (7 decks)

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