TITLE 2 CH.2 SEC.1 CONSENT

Question 1

“Art. 1318. There is no contract unless the following requisites concur:

(1) […];
(2) […];
(3) […].”

Answer 1

“Art. 1318. There is no contract unless the following requisites concur:

(1) Consent of the contracting parties;
(2) Object certain which is the subject matter of the contract;
(3) Cause of the obligation which is established.”

Question 2

What are the classes of elements in a contract?

Answer 2

“The classes of elements in a contract are:

(1) Essential elements - (a) common; (b) special;
(2) Natural elements - presumed to exist in certain contracts (warranty against eviction, warranty against hidden defects in sale, etc.);
(3) Accidental elements - particular stipulations, clauses, terms, or conditions established by the parties in their contract.”

Question 3

What are the essential requisites of a valid contract provided by law in Art. 1318?

Answer 3

“The essential elements provided in Art. 1318 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 established. “

Question 4

“Art. 1319. Consent is manifested by the […] upon the thing and the […]. The offer must be […] and the acceptance […]. A qualified acceptance constitutes a […].

Acceptance made by […] does not bind the offerer except from the time […]. The contract, in such case, is presumed to have been entered into in the place […].”

Answer 4

“Art. 1319. Consent is manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract. The offer must be certain and the acceptance absolute. A qualified acceptance constitutes a counter-offer.

Acceptance made by letter or telegram does not bind the offerer except from the time it came to his knowledge. The contract, in such case, is presumed to have been entered into in the place where the offer was made.”

Question 5

What is the meaning of consent?

Answer 5

“Consent is:

(1) conformity or concurrence of wills (offer and acceptance); and
(2) agreement of the will of one contracting party to that of another or others, upon the object and terms of the contract.”

Question 6

What is the meaning of an offer?

Answer 6

An offer is a proposal made by one (1) party (offerer) to another (offeree), indicating a willingness to enter into a contract.

Question 7

What are the requisites of an offer?

Answer 7

An offer must be (1) certain, and (2) seriously intended.

Question 8

What is the meaning of an acceptance?

Answer 8

An acceptance is the manifestation by the offeree of his assent to all the terms of the offer.

Question 9

What are the requisites for a valid acceptance?

Answer 9

“An acceptance must be clear and absolute.

The acceptance of an offer must not only be clear; it must be absolute, unconditional, or unqualified, that is, it must be identical in all respects with that of the offer so as to produce consent or meeting of minds.”

Question 10

What is the legal effect of a qualified acceptance?

Answer 10

An acceptance with a qualification constitutes a counter-offer, and is considered a rejection of the original offer. This creates another attempt for the parties to enter into a contract which is on a different basis.

Question 11

Art. 1320. An acceptance may be […].

Answer 11

Art. 1320. An acceptance may be express or implied.

Question 12

Can silence be construed as acceptance of an offer?

Answer 12

No, as a rule, silence cannot be construed as acceptance. Acceptance may either be express or implied; it is express when it is made orally or in writing; it is implied when it is inferred from act or conduct. However, mere silence does not imply acceptance.

Question 13

Art. 1321. The person making the offer may fix the […] of acceptance, […].

Answer 13

Art. 1321. The person making the offer may fix the time, place, and manner of acceptance, all of which must be complied with.

Question 14

How may the offer be communicated?

Answer 14

The offer may be communicated expressly or impliedly by the language or acts of the offeror understood as such by the other party. It must be communicated and received by the offeree.

Question 15

Art. 1322. An offer made through an agent is accepted from […].

Answer 15

Art. 1322. An offer made through an agent is accepted from the time acceptance is communicated to him.

Question 16

When will an offer made through an agent be considered as accepted?

Answer 16

It shall be considered accepted when the offer has been communicated to the agent who has made the offer.

Question 17

Art. 1323. An offer becomes ineffective upon the […], […], […], or […] before […].

Answer 17

Art. 1323. An offer becomes ineffective upon the death, civil interdiction, insanity, or insolvency of either party before acceptance is conveyed.

Question 18

What are the circumstances which render offer ineffective?

Answer 18

“The circumstances which render an offer ineffective are:

(1) death; (2) civil interdiction; (3) insanity; or (4) insolvency; of either party.”

Question 19

When the acceptance has already been conveyed prior to the death of a party, shall the offer be ineffective?

Answer 19

No, the offer stands effective because under Art. 1323, An offer becomes ineffective upon the death before acceptance is conveyed. The circumstance which renders the offer ineffective must occur before the acceptance has been conveyed.

Question 20

Art. 1324. When the offerer has allowed the offeree a certain period to accept, the offer may be […] by […], except when […], as something paid or promised.

Answer 20

Art. 1324. When the offerer has allowed the offeree a certain period to accept, the offer may be withdrawn at any time before acceptance by communicating such withdrawal, except when the option is founded upon a consideration, as something paid or promised.

Question 21

What is the meaning of an option contract?

Answer 21

“An option contract is one giving a person for a consideration a certain period within which to accept the offer of the offerer.

Option may also refer to the privilege itself given to the offeree to accept an offer within a certain period.”

Question 22

What is the meaning of an option period?

Answer 22

An option period is the period given within which the offeree must accept the offer.

Question 23

What is the meaning of an option money? How is different from earnest money?

Answer 23

“An option money is the money paid or promised to be paid in consideration of the option.

Earnest money on the other hand is a partial payment of the purchase price and is considered as proof of the perfection of the contract. “

Question 24

When will the debtor lose the right to unilaterally withdraw the offer in cases of offers where the offeree is given a certain period to accept?

Answer 24

The debtor will lose the right to unilaterally withdraw the offer in cases where the offeree is given a certain period to accept when the option is founded upon a consideration, as something paid or promised. For example, an Option contract.

Question 25

What is the difference between Article 1324 and Article 1479?

Answer 25

“Article 1324 provides the general for offer and acceptance while Article 1479 governs cases of unilateral promise to buy or sell determinate things. In the former, the acceptance relinquishes the right of the offeror to withdraw the offer, while in the latte, the acceptance is only binding when the promise is supported by a consideration distinct from the price of the thing. Furthermore, Art. 1479 applies specifically to determinate things while Art. 1324 does not provide any specification.

Under Art. 1324, the acceptance of the offer creates a contract. In Art. 1479, the mere acceptance without a consideration for the promise does not create a contract.”

Question 26

Art. 1325. Unless it appears otherwise, business advertisements of things for sale are not definite offers, but […].

Answer 26

Art. 1325. Unless it appears otherwise, business advertisements of things for sale are not definite offers, but mere invitations to make an offer.

Question 27

What is the general rule and the exception as regards business advertisements of things for sale?/

Answer 27

The general rule regarding business advertisements of things for sale is that they are not considered as definite offers, but mere invitations to make an offer. The exception is when “it appears otherwise” or when the all the particulars necessary to make a definite offer are present.

Question 28

Art. 1326. Advertisements for bidders are simply […], and the advertiser is […], unless […].

Answer 28

Art. 1326. Advertisements for bidders are simply invitations to make proposals, and the advertiser is not bound to accept the highest or lowest bidder, unless the contrary appears.

Question 29

“Art. 1327. The following cannot give consent to a contract:

(1) […];
(2) […].”

Answer 29

“Art. 1327. The following cannot give consent to a contract:

(1) Unemancipated minors;
(2) Insane or demented persons, and deaf-mutes who do not know how to write.”

Question 30

What is the legal effect of a contract entered into where one of the parties is incapable of giving consent, as defined in Art. 1327?

Answer 30

The legal effect of a contract entered into where one of the parties is incapable of giving consent as defined in Art 1327 is that the said contract is deemed voidable. When a contract is voidable, it is valid and binding until annulled by court. It is also susceptible to ratification.

Question 31

When will a contract be voidable due to insanity of one of the contracting parties?

Answer 31

A contract is voidable due to insanity when the insanity of the contracting party exists at the time of the perfection of the contract. The burden of proof rests on the person alleging the insanity/incapacity.

Question 32

When will contracts entered into by deaf-mutes be incapacitated?

Answer 32

In order for a contract to be considered voidable due to having one of the contracting parties deaf-mute, the deaf-mute person must not know how to read and write. If he can, then the contract is valid.

Question 33

Art. 1328. Contracts entered into during a lucid interval are […]. Contracts agreed to in a state of drunkenness or during a hypnotic spell are […].

Answer 33

Art. 1328. Contracts entered into during a lucid interval are valid. Contracts agreed to in a state of drunkenness or during a hypnotic spell are voidable.

Question 34

Art. 1329. The incapacity declared in Article 1327 is subject to the modifications […], and is understood to be without prejudice to […].

Answer 34

Art. 1329. The incapacity declared in Article 1327 is subject to the modifications determined by law, and is understood to be without prejudice to special disqualifications established in the laws.

Question 35

Art. 1330. A contract where consent is given through […], […], […], […], or […] is voidable.

Answer 35

Art. 1330. A contract where consent is given through mistake, violence, intimidation, undue influence, or fraud is voidable.

Question 36

What are the characteristics of consent?

Answer 36

“The characteristics of consent:

(1) It is intelligent. – there is capacity to act;
(2) It is free and voluntary.– there is no vitiation of consent by reason of violence or intimidation; and
(3) It is conscious or spontaneous.– there is no vitiation of consent by reason of mistake, undue influence, or fraud.”

Question 37

What are the legal effects of vices of consent?

Answer 37

The legal effect of vices of consent is that they render the contract voidable for they vitiate consent.

Question 38

What are the vices of consent?

Answer 38

“The vices of consent are:

(1) error or mistake (Art. 1331);
(2) Violence or force (Art. 1335);
(3) Intimidation or threat or duress (ibid);
(4) Undue influence (Art. 1337); and
(5) Fraud or deceit (Art. 1338).”

Question 39

What is the difference between vices of consent and incapacity?

Answer 39

Vices of consent are temporary while incapacity is more or less permanent. Vices of consent refer to the contract itself while incapacity refers to the person entering the contract. Both, however, make a contract voidable.

Question 40

“Art. 1331. In order that mistake may invalidate consent, it should refer to […], or to those conditions which have […].

Mistake as to the identity or qualifications of one of the parties will vitiate consent only when […].

A simple mistake of account shall […].”

Answer 40

“Art. 1331. In order that mistake may invalidate consent, it should refer to the substance of the thing which is the object of the contract, or to those conditions which have principally moved one or both parties to enter into the contract.

Mistake as to the identity or qualifications of one of the parties will vitiate consent only when such identity or qualifications have been principal cause of the contract.

A simple mistake of account shall give rise to its correction.”

Question 41

What is the meaning of mistake or error?

Answer 41

Mistake or error is the false notion of a thing or a fact material to the contract.

Question 42

What is the nature of mistake?

Answer 42

The mistake may be: (1) mistake of fact; (2) substantial mistake of fact (mistake of law); and unilateral or bilateral mistake.

Question 43

In order that mistake may vitiate consent, it must refer to […]?

Answer 43

“In order that mistake may vitiate consent, it must refer to:

(1) The substance of the thing which is the object of the contract; or
(2) Those conditions which have principally moved one or both parties to enter into the contract; or
(3) The identity or qualifications of one of the parties provided the same was the principal cause of the contract. “

Question 44

Art. 1332. When one of the parties is […], or if the contract is […], and mistake or fraud is alleged, the person enforcing the contract must show that […].

Answer 44

Art. 1332. When one of the parties is unable to read, or if the contract is in a language not understood by him, and mistake or fraud is alleged, the person enforcing the contract must show that the terms thereof have been fully explained to the former.

Question 45

What is the duty of the party enforcing the contract when the other party does not know how to read?

Answer 45

Art. 1332 provides that when one of the parties is unable to read, or if the contract is in a language not understood by him, and mistake or fraud is alleged, the person enforcing the contract must show that the terms thereof have been fully explained to the former.

Question 46

When will the person enforcing the contract need to show proof that he explained fully the terms of the contract?

Answer 46

“This case applies in Art 1332 when the following circumstances are present:

(1) One of the parties (the other party) is unable to read; or
(2) The contract is in a language not understood by the other party; and
(3) There is an allegation of mistake or fraud.”

Question 47

Art. 1333. There is no mistake if the party alleging it […], […] or […] affecting the object of the contract.

Answer 47

Art. 1333. There is no mistake if the party alleging it knew the doubt, contingency or risk affecting the object of the contract.

Question 48

Art. 1334. Mutual error as to the legal effect of an agreement when […], may vitiate consent.

Answer 48

Art. 1334. Mutual error as to the legal effect of an agreement when the real purpose of the parties is frustrated, may vitiate consent.

Question 49

What are the requisites in order that mutual error as to legal effect (mistake of law) may vitiate consent?

Answer 49

“The requisites for the application of Article 1334 are:

(1) The error must be mutual;
(2) It must be as to the legal effect of an agreement; and
(3) It must frustrate the real purpose of the parties.”

Question 50

“Art. 1335. There is violence when […].

There is intimidation when one of the contracting parties is compelled by […] fear of an […] upon his […], or upon the person or property of […], to give his consent.

To determine the degree of intimidation, the […], […] and […] of the person shall be borne in mind.

A threat to enforce one’s claim through […], if the claim is […], does not vitiate consent.”

Answer 50

“Art. 1335. There is violence when in order to wrest consent, serious or irresistible force is employed.

There is intimidation when one of the contracting parties is compelled by a reasonable and well-grounded fear of an imminent and grave evil upon his person or property, or upon the person or property of his spouse, descendants or ascendants, to give his consent.

To determine the degree of intimidation, the age, sex and condition of the person shall be borne in mind.

A threat to enforce one’s claim through competent authority, if the claim is just or legal, does not vitiate consent.”

Question 51

What are the requisites in order that intimidation vitiate the consent of a party to a contract?

Answer 51

“Under Art. 1335, for intimidation to vitiate the consent of a party to a contract, the following requisites msut be resent:

(1) It must produce a reasonable and well-grounded fear of an evil;
(2) The evil must be imminent and grave;
(3) The evil must be upon his person or property, or that of his spouse, descendants, or ascendants; and
(4) It is the reason why he enters into the contract.”

Question 52

What is the requisite in order that violence may vitiate the consent of a contracting party?

Answer 52

Under Art. 1335, to make consent defective, the force (violence) employed must be either serious or irresistible, and that it must be the determining cause or reason in giving the consent. (without the violence, the other party would not have consented to the contract)

Question 53

What is the difference between intimidation and violence?

Answer 53

Violence requires the employemtn of physical force. Intimidation need not resort to physical force. Intimidation is internal while violence is external.

Question 54

Art. 1336. Violence or intimidation shall […], although it may have been employed by a third person who did not take part in the contract.

Answer 54

Art. 1336. Violence or intimidation shall annul the obligation, although it may have been employed by a third person who did not take part in the contract.

Question 55

Art. 1337. There is undue influence when a person […] of his power over the will of another, depriving the latter of […]. The following circumstances shall be considered: the […], […], […] and […] between the parties, or the fact that the person alleged to have been unduly influenced was suffering from […], or was […] or in […].

Answer 55

Art. 1337. There is undue influence when a person takes improper advantage of his power over the will of another, depriving the latter of a reasonable freedom of choice. The following circumstances shall be considered: the confidential, family, spiritual and other relations between the parties, or the fact that the person alleged to have been unduly influenced was suffering from mental weakness, or was ignorant or in financial distress.

Question 56

What are the circumstances to be considered to determine whether undue influence has been exercised?

Answer 56

“Under Art. 1337, the following circumstances shall be considered:

(1) confidential, family, spiritual and other relations between the parties,
(2) mental weakness,
(3) ignorance, or
(4) financial distress of the person alleged to have been unduly influenced.”

Question 57

Art. 1338. There is fraud when, […] of one of the contracting parties, the other is […] which, without them, he would not have agreed to.

Answer 57

Art. 1338. There is fraud when, through insidious words or machinations of one of the contracting parties, the other is induced to enter into a contract which, without them, he would not have agreed to.

Question 58

What are the requisites in order that fraud vitiate consent?

Answer 58

“Under Art. 1338, the requisites of causal fraud are:

(1) There must be misrepresentation or concealment of a material fact with knowledge of its falsity (Art. 1338, 1339);
(2) It must be serious (Art. 1344);
(3) It must have been employed by only one of the contracting parties (Art. 1344);
(4) It must be made in bad faith or with intent to deceive (see Art. 1343) the other contracting party who had no knowledge of the fraud;
(5) It must have induced the consent of the other contracting party (Art. 1338); and
(6) It must be alleged and proved by clear and convincing evidence.”

Question 59

Art. 1339. Failure to […] facts, […], as when the parties are bound by […], constitutes fraud.

Answer 59

Art. 1339. Failure to disclose facts, when there is a duty to reveal them, as when the parties are bound by confidential relations, constitutes fraud.

Question 60

Art. 1340. The […] in trade, when the other party had […], are not in themselves fraudulent.

Answer 60

Art. 1340. The usual exaggerations in trade, when the other party had an opportunity to know the facts, are not in themselves fraudulent.

Question 61

When will exaggerations in trade be considered fraudulent?

Answer 61

“Exaggerations in trade will be considered fraudulent when: (1) the other party had no opportunity to know the facts; and (2) the misrepresentation is of a fact, past or present, and not a mere expression of an opinion.

As a general rule in Art. 1340, The usual exaggerations in trade, when the other party had an opportunity to know the facts, are not in themselves fraudulent. “

Question 62

Art. 1341. A mere […] does not signify fraud, unless made by […] and the […].

Answer 62

Art. 1341. A mere expression of an opinion does not signify fraud, unless made by an expert and the other party has relied on the former’s special knowledge.

Question 63

What are the requisites in order that mere expression of opinion amount to fraud?

Answer 63

“Under Art. 1341, in order for an expression of opinion to constitute fraud, the following requisites must be present:

(1) It must be made by an expert;
(2) The other contracting party has relied on the expert’s opinion; and
(3) The opinion turned out to be false or erroneous. “

Question 64

Art. 1342. Misrepresentation by […] does not vitiate consent, unless such misrepresentation has created […].

Answer 64

Art. 1342. Misrepresentation by a third person does not vitiate consent, unless such misrepresentation has created substantial mistake and the same is mutual.

Question 65

What is the general rule and the exception as regards misrepresentation by third persons?

Answer 65

Under Art. 1342, the general rule is that misrepresentation by a third person does not vitiate consent. The exception is when such misrepresentation has created a substantial mistake and the same is mutual, that it affects both parties, the contract may be annulled but principally on the ground of mistake.

Question 66

Art. 1343. Misrepresentation […] is not fraudulent but may constitute […].

Answer 66

Art. 1343. Misrepresentation made in good faith is not fraudulent but may constitute error.

Question 67

What is the legal effect of misrepresentation made in good faith?

Answer 67

The legal effect of misrepresentation made in good faith is that it may constitute error; it does not constitute fraud.

Question 68

“Art. 13434. In order that fraud may make a contract voidable, it should be […] and […].

Incidental fraud only obliges […].”

Answer 68

“Art. 13434. In order that fraud may make a contract voidable, it should be serious and should not have been employed by both contracting parties.

Incidental fraud only obliges the person employing it to pay damages.”

Question 69

Can incidental fraud render a contract voidable?

Answer 69

No, incidental fraud does not make a contract voidable. Under Art. 1344 par.2, incidental fraud only obliges the person employing it to pay damages.

Question 70

What are the two kinds of fraud?

Answer 70

The two kinds of fraud are: (1) causal fraud and (2) incidental fraud.

Question 71

Art. 1345. […] may be absolute or relative. The former takes place when […]; the latter, when […].

Answer 71

Art. 1345. Simulation of a contract may be absolute or relative. The former takes place when the parties do not intend to be bound at all; the latter, when the parties conceal their true agreement.

Question 72

Art. 1346. An absolutely […] is void. A relative simulation, when […] and is not intended for […] binds the parties to their real agreement.

Answer 72

Art. 1346. An absolutely simulated or fictitious contract is void. A relative simulation, when it does not prejudice a third person and is not intended for any purpose contrary to law, morals, good customs, public order or public policy binds the parties to their real agreement.