Modes of extinguishment Flashcards
Obligations are extinguished through
- by payment or performance
- by the loss of the thing due
- by the condonation or remission of the debt
- by the confusion or merger of the rights of creditor and debtor
- by compensation
- by novation
refers only to the deleivery of money. As a mode of extinguishing an obligation, it has a much wider meaning
payment
may consist of not only in the delivery of money but also the giving of a thing (other than money), the doing of an act
payment
By law, payment and performance are
synonymous
general rule: should be complete in performance
payment
exceptions:substantial compliance, acceptance despite incompleteness without objection (estoppel)
payment
susbtantial compliance, acceptance despite incompleteness without objection
estoppel
is the conveyance of ownership of a thing as an accepted equivalent of performance
dation in payment
it is a special form of payment because it is not only payment of money, but also the alienation of property
dation in payment
other special forms of payment
-payment by cession
-tender of payment and consignation
-application of payments
it is the assignment or abandonment of all the properties of the debtor for the benefit of his creditors in order that the latter may sell and apply the proceeds thereof to the satisfaction of their credits
payment by cession
requisites
-there must be two or more creditors
-the debtor must be partially insolvent
-the cession must be accepted by the creditors
payment by cession
there is usually only one creditor
dation in payment
does not presuppose insolvency of the debtor
dation in payment
does not involve all the property of the debtor
dation inpayment
creditor becomes the owner of the things given by the debtor
dation in payment
is really an act of novation
dation in payment
is not an act of novation
payment by cession
the creditors only acquire the right to sell the thing and apply the proceeds to their credit proportionately
payment by cession
extend to all the property of the debtor subject to execution
payment by cession
the debtor is insolvent at the time of the assignment
payment by cession
there are sevral creditors
payment by cession
act of the debtor of offering to the creditor the thing or amount due
tender of payment
the debtor must show his possession the thing or money to be delivered at the time of the offer
tender of payment
all coins and notes issued by the Bangko Sentral ng Pilipinas (BSP) that constitute legal tender for all debts, both public and private
legal tender in the Philippines
is the act of depositing the thing or amount due with the proper court when the creditor does not desire or cannot receive it, after complying with the formalities required by law
consignation
it is always judicial and it generally requires prior tender of payment which is by its very nature extrajudicial
consignation
An obligation which consists in the
delivery of a determinate thing shall be
extinguished if it should be lost or destroyed
without the fault of the debtor, and before he
has incurred in delay.
When by law or stipulation, the obligor is
liable even for fortuitous events, the loss of the
thing does not extinguish the obligation, and
he shall be responsible for damages. The same
rule applies when the nature of the obligation
requires the assumption of risk. (1182a)
loss of the thing due
In an obligation to deliver a generic
thing, the loss or destruction of anything of the
same kind does not extinguish the obligation.
loss of the thing due
The courts shall determine whether,
under the circumstances, the partial loss of the
object of the obligation is so important as to
extinguish the obligation.
loss of the thing due
Whenever the thing is lost in the
possession of the debtor, it shall be
presumed that the loss was due to his fault,
unless there is proof to the contrary, and
without prejudice to the provisions of article
1165. This presumption does not apply in
case of earthquake, flood, storm, or other
natural calamity. (1183a)
loss of the thing due
essentially gratuitous, and requires the
acceptance by the obligor. It may be made
expressly or impliedly.
One and the other kind shall be subject to the
rules which govern inofficious donations.
Express condonation shall, furthermore,
comply with the forms of donation. (1187)
condonation or remission of debt
Is the gratuitous abandonment by the
creditor of his right against the debtor
condonation/remission
Thus, a form of donation.
There must be a proof of “right to
ownership” of the thing to be donated as to
extinguish an obligation.
condonation/remission
The obligation is extinguished from
the time the characters of creditor and debtor
are merged in the same person.
confusion or merger of rights
shall take place
when two persons, in their own right, are
creditors and debtors of each other. (
compensation
may be legal,
voluntary/conventional, &
judicial
compensation
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
Is the extinction of an obligation
through the creation of a new one
which substitutes it
novation
Modification of the obligation by
real novation & personal novation.
(Article 1291)
novation
Extinguishment of an obligation by creating a new one
novation
kinds of novation
- real/objective
- personal/subjective
change object,
cause/consideration or principal condition
real/objective
types of personal/subjective novation
substitution
subrogation
when the person of the debtor
is substituted.
substitution
types of susbtitution
expromision
delegacion
(initiative is from 3rd person
or new debtor)
expromision
(initiative of old debtor)
delegacion
when a third person is
subrogated in the rights of the creditor
subrogation
can be express or implied. If
implied, establish incompatibility
novation
intent to substitute a
new obligation in the place of old one;
must be clearly established before there
can be novation resulting in the
extinguishment of the old obligation
and the creation of a new one.
animus novandi
oral or written
express
silent means yes
implied
5 w’s and 1 h
how to pay
where to pay
when to pay
whom to pay
who to pay
what to pay
acceptance is made only after the donor’s death because they partake of the nature of a will and thus governed by the rules on succession.
mortis cause
acceptance takes effect during the lifetime of the donor and the donee
inter vivos
