San Beda College of Law

85

MEMORY AID IN CIVIL LAW

OBLIGATIONS AND CONTRACTS

2. Solutio indebiti - arises whenever a
I. OBLIGATIONS person unduly delivers a thing

OBLIGATION through mistake to another who has no

 A juridical necessity to give, to do, right to demand it.
or not to do (Article 1156), one
impressed with the character of QUASI-DELICTS
enforceability.  An act or omission by a person
(tortfeasor) which causes damage to
 Requisites: another giving rise to an obligation
a. juridical or legal tie or efficient to pay for the damage done, there
cause being fault or negligence but there is
b. active subject (obligee or no pre-existing contractual relation
creditor) between the parties (Article 2176).
c. passive subject (obligor or
debtor)  Requisites:
d. fact, prestation or service 1. There must be an act or
constituting the object of the omission;
obligation 2. There must be fault or
 Requisites: negligence;
i) it must be licit 3. There must be damage caused to
ii) it must be possible, the plaintiff;
physically & juridically 4. There must be a direct relation
iii) it must be determinate or of cause and effect between the
determinable act or omission and the damage;
iv) it must have a possible and
equivalent in money 5. There is no pre-existing
contractual relation between the
 Sources (Article 1157): parties.
1. Law
2. Contracts NOTES:
3. Quasi-contracts  The same negligent act or omission
4. Delicts causing damage may produce civil
5. Quasi-delicts liability arising from crime under
Art. 100 of the RPC or create an
QUASI-CONTRACTS action for quasi-delict under Article
 Those juridical relations arising from 2176.
lawful, voluntary and unilateral acts,  While it is true that in order that a
by virtue of which the parties person may be liable for quasi-
become bound to each other, based delicts, there must be no pre-
on the principle that no one shall be existing contractual relationship
unjustly enriched or benefited at the between the parties, yet, “the act
expense of another. that breaks the contract may also
be a tort.” (Air France vs.
Principal Kinds of Quasi-contracts: Carrascoso, 18 SCRA 155).
1. Negotiorum gestio - arises whenever
a person voluntarily takes charge of Nature of Obligations
the agency or management of the 1. Personal Obligations - obligations to
business or property of another do
without any power or authority from a. Positive – obligation to do
the latter. b. Negative – obligation not to do
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
86 2005 CENTRALIZED BAR OPERATIONS

2. Real Obligations - obligations to give performance likewise be equitable

a. Determinate or specific – object and just. The general rule is that
is particularly designated or this equitable relief will not be
physically segregated from all granted if, under the circumstances
other of the same class of the case, the result of the specific
b. Generic – object is designated performance of the contract would
merely by its class or genus be harsh, inequitable, oppressive or
c. Limited generic thing – when the result in an unconscionable
generic objects are confined to a advantage to the plaintiff. The
particular class, e.g. an courts may adjust the rights of the
obligation to deliver one of my parties in accordance with the
horses (Tolentino, Volume IV, p. circumstances obtaining at the time
91). of rendition of judgment, when
these are significantly different from
PERSONAL vs. REAL RIGHT those existing at the time of
Personal Real generation of those rights. (Agcaoili
1. jus ad rem, a 1. jus in re, a right vs. GSIS, G.R. No. 30056, August 30,
right enforceable enforceable against 1988)
only against a the whole world
definite person or Obligations of the debtor
group of persons
Determinate Generic
2. right pertaining 2. right pertaining
1. deliver the thing 1. deliver the thing
to the person to to a person over a
which he has which is neither of
demand from specific thing,
obligated himself to superior nor inferior
another, as a without a passive
give quality
definite passive subject individually
2. take care of the 2. pay damages in
subject, the determined against
thing with the case of breach of
fulfillment of a whom such right
proper diligence of the obligation by
prestation to give, may be personally
a good father of a reason of delay,
to do or not to do. enforced
family fraud, negligence or
3. deliver all contravention of the
RIGHTS OF A CREDITOR accessions and tenor thereof
Determinate Generic accessories of the
1. compel specific 1. ask for thing even though
performance performance of the they may not have
obligation been mentioned
2. recover 2. ask that the 4. pay damages in
damages in case of obligation be case of breach of
breach of the complied with at the obligation by
obligation, the expense of the reason of delay,
exclusive or in debtor fraud, negligence or
addition to contravention of the
specific tenor thereof
performance
3. entitlement to 3. recover damages Effects of Breach
fruits, interests in case of breach Positive Personal Negative Personal
from the time the of the obligation
Obligations Obligations
obligation to
The creditor can: If the obligor does
deliver arises.
1. have the what has been
obligation performed forbidden him, the
Principle of Balancing of Equities as or executed at the creditor can:
Applied in Actions for Specific expense of the 1. have it undone at
Performance obligor (except in the expense of the
 In decreeing specific performance, cases where the obligor; and
equity requires not only that the personal 2. ask for damages
contract be just and equitable in its qualifications of the
provisions, but that the debtor are taken into
account in which
consequences of specific
case the only remedy
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

is an action for
damages)
2. ask that what has
been poorly done be
undone
 3 Kinds:
3. recover damages
because of breach of 1. Mora solvendi - delay of the debtor
the obligation to perform his obligation. It may be:
a. Ex re – obligation is to
Cases where the remedy granted under give
Article 1168 is not available: b. Ex persona – obligation is
1. Where the effects of the act which is to do
forbidden, are definite in character, 2. Mora accipiendi - delay of the
in which case, even if it is possible creditor to accept the delivery of
for the obligee to ask that the act be the thing w/c is the object of the
undone at the expense of the obligation
obligor, consequences contrary to 3. Compensatio morae - delay of the
the object of the obligation will have parties or obligors in reciprocal
been produced which are permanent obligation
in character
2. Where it would be physically or  When incurred:
legally impossible to undo what has General Rule: There must be a demand
been undone because of the very (judicial or extra-judicial) before delay
nature of the act itself or because of may be incurred.
a provision of law, or because of Exceptions:
conflicting rights of 3rd persons 1. obligation or law expressly so
NOTE: In either case, the remedy is to declares
ask for damages. 2. time is of the essence of the
contract
BREACH OF OBLIGATIONS 3. demand is useless as when
1. Voluntary - debtor, in the obligor has rendered beyond his
performance of the obligation, is power to perform
guilty of: 4. there is acknowledgment of
a. default (mora) default
b. fraud (dolo)
c. negligence (culpa) NOTES:
d. contravention of the tenor of  There can be delay only in positive
the obligation obligations (to give/to do). There
NOTE: debtor is liable for damages can be no delay in negative
obligations (not to give/not to do).
2. Involuntary - debtor is unable to  In reciprocal obligations one party
comply with his obligation because incurs in delay from the moment the
of fortuitous event other party fulfills his obligation,
NOTE: debtor is not liable for while he himself does not comply or
damages is not ready to comply in a proper
manner with what is incumbent upon
DEFAULT or DELAY him. The general rule is that
 Non-fulfillment of the obligation fulfillment by both parties should be
with respect to time simultaneous except when different
 Requisites: dates for the performance of
1. Obligation is demandable and obligation is fixed by the parties.
already liquidated  Demand is still necessary if their
2. The debtor delays performance respective obligations are to be
3. The creditor requires performance performed on separate dates
judicially or extra-judicially
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
88 2005 CENTRALIZED BAR OPERATIONS

FRAUD Concept of Diligence of Good Father of

 Deliberate and intentional evasion of a Family
the fulfillment of an obligation  That reasonable diligence which an
ordinary prudent person would have
done under the same circumstances

NOTE: Future fraud cannot be waived Test of Negligence

because it would result to illusory
obligation.  The test of negligence can be
determined by this standard: If the
Incidental Causal Fraud/dolo defendant, in committing or causing
Fraud/dolo causante the negligent act, had used
incidente (Article 1338) reasonable care and vigilance which
(Article 1170) a man of ordinary prudence would
have employed under the same
1. Present during 1. Present during the situation, he is not guilty of
the performance time of birth or negligence. Otherwise, he is guilty.
of a pre-existing perfection of the
obligation obligation Doctrine of Res Ipsa Loquitur as
Applied in Negligence Cases
2. Purpose is to 2. Purpose is to
evade the normal secure the consent of  The thing or transaction speaks for
fulfillment of the the other to enter itself
obligation into a contract  When the thing which caused injury,
without fault of the injured person,
3. Results in the 3. Results in the is under the exclusive control of the
non-fulfillment or vitiation of consent defendant and the injury is such as
breach of the
obligation
in the ordinary course of things does
not occur if he having such control
4. Gives rise to a 4. Gives rise to a use proper care, it affords
right of the creditor right of an innocent reasonable evidence, in the absence
to recover damages party to annul the of explanation from the defendant,
from the debtor contract that the injury arose from
defendant’s want of care (Africa vs.
Caltex, 16 SCRA 448 and Republic
NEGLIGENCE vs. Luzon Stevedoring, 21 SCRA 279).
 Omission of that diligence which is
required by the nature of the FORTUITOUS EVENT
obligation and corresponds with the  An event which could not be
circumstances of the persons, of the foreseen or which though foreseen
time and of the place was inevitable.
NOTE: Negligence can be waived unless
the nature of the obligation or public  Requisites:
policy requires extraordinary diligence as 1. cause is independent of the will of
in common carrier. the debtor
2. the event must be unforeseeable or
Diligence Required unavoidable
1. That agreed upon by the parties 3. occurrence must be such as to
2. In the absence of stipulation, that render it impossible for the debtor
required by law in the particular to fulfill his obligation in a normal
case manner
3. If both the contract and law are 4. debtor must be free from any
silent, diligence of a good father of a participation in
family 5. the aggravation of the injury
resulting to the creditor (Lasam vs.
Smith, 45 Phil. 657)
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

NOTE: 2nd & 3rd remedies are

NOTE: It must not only be the subsidiary to the first
proximate cause but it must be the
ONLY and SOLE CAUSE. GENERAL RULE: Rights acquired by
virtue of an obligation are transmissible
in character

GENERAL RULE: No liability in case of

fortuitous event.
EXCEPTIONS: EXCEPTIONS:
1 When expressly declared by law 1. When they are not transmissible
NOTE: e.g. Article 552(2), by their very nature e.g. purely
1165(3), 1268, 1942, 2147, 2148 personal right
and 2159 of the Civil Code. 2. When there is a stipulation of
2 When expressly declared by the parties that they are not
stipulation or contract transmissible
3 When the nature of the 3. Not transmissible by operation of
obligation requires the law
assumption of risk
4 When the obligor is in default or PURE OBLIGATION
has promised to deliver the same  One whose effectivity or
thing to 2 or more persons who extinguishment does not depend
do not have the same interest upon the fulfillment or non-
[Article 1165(3)]. fulfillment of a condition or upon the
expiration of a term or period and is
EFFECT OF FORTUITOUS EVENT demandable at once.
Determinate Generic Obligation
Obligation CONDITIONAL OBLIGATION
obligation is obligation is not  One whose effectivity is
extinguished extinguished based subordinated to the fulfillment or
on the rule that a non-fulfillment of a future AND
genus never perishes uncertain fact or event
(genus nunquam
peruit)
Kinds of conditions:
1. Suspensive - fulfillment of the
condition results in the acquisition of
rights arising out of the obligation
PRINCIPLE UNDER ARTICLE 1176
2. Resolutory - fulfillment of the
 Before the presumption that a prior condition results in the
installment had been paid may arise, extinguishments of rights arising out
the receipt must specify the of the obligation
installment for which payment is 3. Potestative - fulfillment of the
made. condition depends upon the will of a
party to the obligation
 REMEDIES OF CREDITOR TO 4. Casual - fulfillment of the condition
PROTECT CREDIT: depends upon chance and/or upon
1. Exhaustion of debtor’s property the will of a third person
2. Accion subrogatoria - to be 5. Mixed - fulfillment of the condition
subrogated to all the rights and depends partly upon chance and/or
actions of the debtor save those the will of a third person
which are inherent in his person. 6. Possible - condition is capable of
3. Accion pauliana - impugn all the acts realization according to nature, law,
w/c the debtor may have done to public policy and good customs
defraud them.

CIVIL LAW COMMITTEE

 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
90 2005 CENTRALIZED BAR OPERATIONS

7. Impossible - condition is not capable 2. After the fulfillment of the

of realization according to nature, condition, the obligation arises or
law, public policy and good customs becomes effective
8. Positive - condition involves the 3. The effects of a conditional
performance of an act obligation to give, once the
9. Negative - condition involves the condition has been fulfilled, shall
omission of an act retroact to the day of the
10. Divisible - condition is susceptible of constitution of the obligation
partial realization 4. When the obligation imposes
11. Indivisible - condition is not reciprocal prestations upon the
susceptible of partial realization parties, the fruits & interests shall
12. Conjunctive - where there are be deemed to have been mutually
several conditions, all of which must compensated
be realized 5. If the obligation is unilateral, the
13. Alternative - where there are several debtor shall appropriate the fruits &
conditions but only one must be interests received, unless from the
realized nature & circumstances it should be
inferred that the intention of the
Rule in Potestative Conditions persons constituting the same was
a. If the fulfillment of the different
potestative condition depends 6. In obligations to do or not to do, the
upon the sole will of the debtor, court shall determine the retroactive
the condition as well as the effect or the conditions that has
obligation itself is void. It renders been complied with
the obligation illusory.
(Applicable only to a suspensive Constructive fulfillment of Suspensive
condition and to an obligation Condition
which depends for its perfection
 The condition shall be deemed
upon the fulfillment of the
fulfilled when the obligor actually
potestative condition and not to a
prevented the obligee from
pre-existing obligation.)
complying with the condition and
b. If the fulfillment depends
such prevention must have been
exclusively upon the will of the
voluntary and willful in character.
creditor, both the condition and
obligation is valid.
Effects of Resolutory Condition
NOTE: In case of simple potestative
1. Before the fulfillment of the
condition, e.g. right of first refusal,
condition, the right which the
such condition is valid.
creditor has already acquired by
virtue of the obligation is subject to
Rule in Impossible Conditions
a threat of extinction.
GENERAL RULE: They shall annul the
2. If condition is not fulfilled, rights are
obligation which depends upon them.
consolidated; they become absolute.
EXCEPTIONS:
3. Upon fulfillment of the condition,
1. pre-existing obligation
the parties shall return to each other
2. if obligation is divisible
what they received including the
3. in simple or renumeratory donations
fruits
4. in testamentary dispositions
5. in case of conditions not to do an
SUMMARY:
impossible thing
SUSPENSIVE RESOLUTORY
Effects of Suspensive Condition CONDITION CONDITION
1. if fulfilled, 1. if fulfilled,
1. Before fulfillment of the condition,
obligation arises obligation is
the demandability as well as the or becomes extinguished
acquisition or effectivity of the effective
rights arising from the obligation is 2. if not fulfilled, 2. if not fulfilled,
suspended
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

no juridical juridical
relation is created relation is TACIT RESOLUTORY CONDITION
3. rights are not yet consolidated If one of the parties fails to comply
acquired, but 3. rights are with what is incumbent upon him, there
there is hope or already
is a right on the part of the other to
expectancy that acquired, but
they will soon be subject to the rescind the obligation.
acquired threat or danger
of extinction

Effects of Loss, Deterioration and

Improvement in real obligations (during
the pendency of the condition) RIGHT TO RESCIND (ART 1191)
GENERAL RULE: The right to rescind
1. Loss needs judicial approval.
a. without debtor’s fault - EXCEPTIONS:
obligation is extinguished 1. If there is an express stipulation
b. with debtor’s fault - debtor pays of automatic rescission
damages 2. When the debtor voluntarily
returned the thing
2. Deterioration
a. without debtor’s fault - NOTES:
impairment to be borne by the  Article 1191 refers to judicial
creditor rescission. It does not apply if there
b. with debtor’s fault - creditor is an express stipulation to rescind,
may choose between the in which case such stipulation must
rescission of the obligation and prevail. There is nothing in the law
its fulfillment with indemnity for which prohibits the parties from
damages in either case entering into an agreement that
violation of the terms of the
3. Improvement contract would cause its cancellation
a. by the thing’s nature or by time without court intervention. Said
- improvement shall inure to the stipulation is in the nature of
benefit of the creditor facultative resolutory condition
b. at the debtor’s expense - debtor (Angeles vs. Calasanz, 135 SCRA
shall have no other right than 323).
that granted to a usufructuary  Rescission will be ordered only
where the breach is substantial as to
NOTE: Applies only to determinate defeat the object of the parties in
things entering into the agreement.
 The injured party may choose
A Thing is Lost when it: between fulfillment and rescission of
1. perishes the obligations, with the payment of
2. goes out of commerce damages in either case. These
3. disappears in such a way that its remedies are alternative, not
existence is unknown or it cannot be cumulative. However, should
recovered fulfillment become impossible, the
injured party may also seek
RECIPROCAL OBLIGATIONS rescission.
 Those which are created or established  The right to rescind belongs
at the same time, out of the same exclusively to the injured party.
cause, and which result in mutual
relationships of creditor & debtor OBLIGATION WITH A PERIOD
between the parties
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
92 2005 CENTRALIZED BAR OPERATIONS

 Those whose demandability or circumstances that the period has been

extinguishment is subject to the established in favor of one or of the
expiration of a term or period other.
 Requisites:
1. future When court may fix period:
2. certain 1. if the obligation does not fix a
3. possible, legally and physically period, but from its nature and
circumstances it can be inferred that
CLASSIFICATION OF TERM OR PERIOD a period was intended by the parties
1. a. suspensive (ex die) – obligation 2. if the duration of the period depends
becomes demandable only upon upon the will of the debtor; and
arrival of a day certain 3. If the debtor binds himself when his
means permit him to do so (Article
b. resolutory (in diem) – arrival of 1180)
day certain terminates the obligation
2. a. legal – granted by law NOTE: The only action that can be
b. conventional – stipulated by maintained is an action to ask the court
parties to fix the duration of the term or period.
c. judicial – fixed by courts The fulfillment of the obligation itself
3. a. definite – date/time is know cannot be demanded until after the
beforehand court has fixed the period for
b. indefinite – the date/time of day compliance therewith, and such period
certain is unknown has arrived. However, such technicality
need not be adhered to when a prior and
TERM CONDITION separate action would be a mere
1. interval of time 1. fact or event w/c formality and would serve no other
w/c is future & is future and purpose than to delay (Borromeo vs. CA,
certain uncertain 47 SCRA 65).
2. interval of time 2. future and
w/c must uncertain fact or Reason for Fixing the Period (ART 1197)
necessarily come, event w/c may or  There can be no possibility of any
although it may may not happen
breach of contract or failure to
not be known when
perform the obligation unless the
3.exerts an 3. exerts an
influence upon the influence upon the period is fixed by courts.
time of very existence of the
demandability or obligation itself When debtor loses right to make use of
extinguishment of period: (IGIVA)
an obligation 1. when after the obligation has
4. does not have 4. has retroactive been contracted, he becomes
any retroactive effect insolvent, unless he gives
effect unless there guaranties or securities for the debt
is an agreement to
(the insolvency need not be
the contrary
judicially declared)
5. when it is left 5. when it is left
exclusively to the exclusively to the will 2. when he does not furnish to the
will of the debtor, of the debtor, the creditor the guaranties or securities
the existence of very existence of the he promised
the obligation is obligation is affected 3. when by his own act he has
not affected impaired said guaranties or
securities after their establishment,
GENERAL RULE: When a period is and when through fortuitous event
designated for the performance or they disappear, unless he gives new
fulfillment of an obligation, it is ones equally satisfactory when
presumed to have been established for debtor violates any undertaking, in
the benefit of both creditor and debtor. consideration of which the creditor
EXCEPTION: When it appears from the agreed to the period or
tenor of the obligation or other
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

4. when debtor attempts to cannot be performed due to the

abscond fault of the debtor, creditor
cannot hold the debtor liable for
FACULTATIVE ALTERNATIVE damages because the debtor can
Obligations Obligations still comply with his obligation.
2. If right of choice belongs to the
1. comprehends 1. comprehends creditor
only one object or several objects or a. If 1 of the things is lost through
prestation which is prestations which are a fortuitous event, the debtor
due, but it may be due but may be shall perform the obligation by
complied with by complied with by the
the delivery of delivery or
delivering that which the
another object or performance of only creditor should choose from
performance of one of them among the remainder, or that
another prestation which remains if only 1 subsists
in substitution b. If the loss of 1 of the things
occurs through the fault of the
2. fortuitous loss 2. fortuitous loss of debtor, the creditor may claim
extinguishes the all prestations will any of those subsisting, or the
obligation extinguish the price of that which, through the
obligation
fault of the former, has
3. culpable loss 3. culpable loss of any
disappeared with a right to
obliges the debtor object due will give damages
to deliver rise to liability to c. If all the things are lost through
substitute debtor the fault of the debtor, the
prestation without choice by the creditor shall fall
liability to debtor upon the price of any 1 of them,
also with indemnity for damages
4. choice pertains 4. choice may pertain JOINT AND SOLIDARY OBLIGATIONS
only to debtor to creditor or even
GENERAL RULE: Obligation is presumed
third person
joint if there is concurrence of two or
more debtors and/or creditors.
NOTES: EXCEPTIONS:
1. when expressly stated that
 In alternative obligations, choice there is solidarity
takes effect only upon 2. when the law requires solidarity
communication of the choice to the 3. when the nature of the
other party and from such time the obligation requires solidarity
obligation ceases to be alternative.
 The debtor cannot choose those JOINT DIVISIBLE OBLIGATIONS
prestations or undertakings which  Each creditor can demand for the
are impossible, unlawful or w/c payment of his proportionate share
could not have been the object of of the credit, while each debtor can
the obligation. be held liable only for the payment
of his proportionate share of the
EFFECT OF LOSS OF OBJECT OF debt.
OBLIGATION:  A joint creditor cannot act in
1. If right of choice belongs to debtor representation of the other creditors
a. If through a fortuitous event - while a joint debtor cannot be
debtor cannot be held liable for compelled to answer for the acts or
damages liability of the other debtors.
b. If 1 or more but not all of the
things are lost or one or some JOINT INDIVISIBLE OBLIGATIONS
but not all of the prestations
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
94 2005 CENTRALIZED BAR OPERATIONS

1. If there are 2 or more debtors, the with the consequent obligation to

fulfillment of or compliance with the render an accounting of his acts to
obligation requires the concurrence such creditors
of all the debtors, although each for  creates a relationship of mutual
his own share. Consequently, the agency among solidary creditors
obligation can be enforced only by 2. Passive solidarity
proceeding against all of the  solidarity of debtors
debtors.  liability of each debtor for the
2. If there are 2 or more creditors, the payment of the entire obligation,
concurrence or collective act of all with the consequent right to demand
the creditors, although each for his reimbursement from the others for
own share, is also necessary for the their corresponding shares once
enforcement of the obligation. payment has been made
3. Mixed solidarity
Effect of breach – If one of the joint  solidarity among creditors and
debtors fails to comply with his debtors
undertaking, the obligation can no Effect of Assignment by Solidary
longer be fulfilled or performed. Creditor Without Consent of Others
Consequently, it is converted into one of 1. assignee is co-creditor – no violation
indemnity for damages. Innocent joint of Article 1213 because there can be
debtors shall not contribute to the no invasion of the personal or
indemnity beyond their corresponding confidential relationship
share of the obligation. 2. assignee is third person – co-
creditors and debtors are not bound
Effect of insolvency of a debtor – If one by the assignment
of the joint debtors should be insolvent,
the others shall not be liable for his Effect of Novation upon Solidary
share. Obligation
1. If the novation is prejudicial, the
INDIVISIBILITY SOLIDARITY solidary creditor who effected the
1. refers to the 1. refers to the novation shall reimburse the others
prestation which legal tie or vinculum for damages incurred by them
constitutes the juris & consequently 2. If it is beneficial and the creditor
object of the to the subjects or who effected the novation is able to
obligation parties of the secure performance of the
obligation
obligation, such creditor shall be
2. plurality of 2. plurality of
subjects is not subjects is liable to the others for the share
required indispensable which corresponds to them, not only
3. in case of breach, 3. when there is in the obligation, but also in the
obligation is liability on the part benefits
converted into 1 of of the debtors 3. If the novation is effected by
indemnity for because of the substituting another person in place
damages because of breach, the of the debtor, the solidary creditor
breach, indivisibility solidarity among the who effected the novation is liable
of the obligation is debtors remains
for the acts of the new debtor in
terminated
case the is deficiency in
performance or in case damages are
incurred by the other solidary
KINDS OF SOLIDARITY
creditors as a result of the
1. Active solidarity
substitution.
 solidarity of creditors
4. If the novation is effected by
 each creditor is empowered to
subrogating a third person in the
exercise against the debtor not only
rights of the solidary creditor
the rights which correspond to him,
responsible for the novation, the
but also all the rights which
relation between the other creditors
correspond to the other creditors,
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

not substituted and the debtor or 3. Right to recover interest from time
debtors is maintained. the obligation becomes due

Effect of Compensation and Confusion Effect of Loss or Impossibility of

upon Solidary Obligation Performance
1. If the confusion or compensation is 1. If it is not due to the fault of the
partial, the rules regarding solidary debtors, the obligation is
application of payment shall apply. extinguished.
This is without prejudice to the 2. If the loss or impossibility is due to
right of other creditors who have the fault of one of the solidary
not caused the confusion or debtors or due to a fortuitous event
compensation to be reimbursed to after one of the solidary debtors had
the extent that their rights are already incurred in delay, the
diminished or affected. obligation is converted into an
2. If the confusion or compensation is obligation of indemnity for damages
total, the obligation is extinguished, but the solidary character of the
what is left is the ensuing liability obligation remains.
for reimbursement within each
group:
a. The creditor causing the
confusion or compensation is Defenses available to a Solidary Debtor
obliged to reimburse the other 1. Defenses derived from the very
creditors nature of the obligation
b. The debtors benefited by the 2. Defenses personal to him or
extinguishments of the pertaining to his own share
obligation are obliged to 3. Defenses personal to the others, but
reimburse the debtor who made only as regards that part of the debt
the confusion or compensation for w/c the latter are responsible
possible.
DIVISIBLE OBLIGATIONS
Effect of Remission upon Solidary  Those which have as their object a
Obligation prestation which is susceptible of
1. If the remission covers the entire partial performance without the
obligation, the obligation is totally essence of obligation changed.
extinguished and the entire juridical
relation among the debtors is INDIVISIBLE OBLIGATIONS
extinguished all together.  Prestation is not susceptible of
2. If the remission is for the benefit of partial performance, otherwise, the
one of the debtors and it covers his essence of the obligation will be
entire share in the obligation, he is changed
completely released from the
creditors but is still bound to his co- NOTES:
debtors.  Divisibility or indivisibility of the
3. If the remission is for the benefit of obligation refers to the performance
one of the debtors and it covers only of the prestation and not to the
a part of his share in the obligation, thing which is the object thereof.
his character as a solidary debtor is  Intention of parties should be taken
not affected. into account to determine whether
obligation is divisible or not.
Effect of Payment by Solidary Debtor
1. Whole or partial extinguishment of GENERAL RULE: The creditor cannot be
debt compelled partially to receive the
2. Right to recover against co-debtor prestation in which the obligation

CIVIL LAW COMMITTEE

 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
96 2005 CENTRALIZED BAR OPERATIONS

consists; neither may the debtor be principal obligation by paying the

required to make partial payments. stipulated penalty unless when the
EXCEPTIONS: right has been expressly reserved for
1. When the obligation expressly him.
stipulates the contrary;  The creditor cannot demand the
2. When the different prestations fulfillment of the principal obligation
constituting the objects of the and the satisfaction of the stipulated
obligation are subject to penalty at the same time unless the
different terms and conditions; right has been clearly granted him.
and
3. When the obligation is in part When penalty may be reduced
liquidated and in part 1. If the principal obligation has been
unliquidated. partly complied with;
2. If the principal obligation has been
OBLIGATIONS WITH A PENAL CLAUSE irregularly complied with; and
 One to which an accessory 3. If the penalty is iniquitous or
undertaking is attached for the unconscionable even if there has been
purpose of insuring its performance no performance.
by virtue of which the obligor is
bound to pay a stipulated indemnity
or perform a stipulated prestation in MODES OF EXTINGUISHMENT OF
case of breach. OBLIGATIONS (LFC3NARP2)
1. loss of the thing due
 Purpose of Penalty: 2. fulfillment of resolutory condition
1. To insure the performance of the 3. compensation
obligation; 4. condonation or remission of the debt
2. to liquidate the amount of 5. confusion or merger of rights of the
damages to be awarded to the creditor and debtor
injured party in case of breach 6. novation
of the principal obligation 7. annulment
(compensatory); and 8. rescission
3. in certain exceptional cases, to 9. prescription
punish the obligor in case of 10. payment or performance
breach of the principal
obligation (punitive). Payment or Performance
 Means not only the delivery of
GENERAL RULE: The penalty fixed by money but also the performance, in
the parties is a compensation or any other manner, of an obligation.
substitute for damages in case of
breach. Integrity of Payment
EXCEPTIONS: GENERAL RULE: A debt shall not
1. when there is a stipulation to be understood to have been paid unless
the contrary; the thing or service in which the
2. when the debtor is sued for obligation consists has been completely
refusal to pay the agreed delivered or rendered, as the case may
penalty; and be.
3. when debtor is guilty of fraud EXCEPTIONS:
1. When the obligation has been
NOTE: Article 1228 does not apply to substantially performed in good
these exceptions; there must be faith;
proof of actual damages. 2. When the obligee accepts
performance, knowing its
NOTES: incompleteness or irregularity &
w/out expressing any protest or
 The debtor cannot exempt himself
objection;
from the performance of the

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT

CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

3. When there is an express stipulation; to the benefit of the creditor.

and Such benefit to the creditor is
4. When the debt is in part liquidated presumed in the following cases:
and in part unliquidated.  If after the payment, the
third person acquires the
Identity of Payment creditor’s rights;
 requires that the very thing, service  If the creditor ratifies the
or forbearance, as the object of the payment to the third
prestation, must be performed or person;
observed  If by the creditor’s conduct,
the debtor has been led to
Persons who may pay the obligation: believe that the third
1. the debtor himself or his legal person had authority to
representative receive the payment.
2. any third person 2. Payment made to the possessor
of the credit, provided that it
GENERAL RULE: Creditor is not bound to was made in good faith.
accept payment or performance by a
third person. Obligation to Deliver a Generic Thing
EXCEPTIONS:  If the quality and circumstances
1. when made by a third person have not been stated, the creditor
who has an interest in the cannot demand a thing of superior
fulfillment of the obligation; quality; neither can the debtor
2. when there is a stipulation to deliver a thing of inferior quality.
the contrary.

Rights of 3rd person who paid the

obligation: Rules in Monetary Obligations:
1. If payment was made with 1. Payment in cash - must be made in
knowledge and consent of the the currency stipulated; if it is not
debtor: possible to deliver such currency,
a. can recover entire then in the currency which is legal
amount paid tender in the Philippines.
b. can be subrogated to all 2. Payment in check or other
the rights of the negotiable instrument - not
creditor. considered payment; not considered
2. If payment was made without legal tender and may be refused by
knowledge or against the will of the creditor. It shall only produce
the debtor, he can recover only the effect of payment:
insofar as the payment has been a. when it has been cashed or
beneficial to the debtor. b. when it has been impaired
through the fault of the creditor.
To whom payment must be made:
1. The person in whose favor the LEGAL TENDER
obligation has been constituted;  Such currency which may be used for
2. His successor in interest; or the payment of all debts, whether
3. Any person authorized to receive it. private or public. The kind of
currency which a debtor can legally
GENERAL RULE: If payment is made to a compel a creditor to accept in
person other than those enumerated, it payment of a debt in money when
shall not be valid. tendered by the debtor in the right
EXCEPTIONS: amount.
1. Payment made to a 3rd person,
provided that it has redounded
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
98 2005 CENTRALIZED BAR OPERATIONS

 Legal tender of the Philippines d. Tender of payment and

would be all notes and coins issued Consignation
by the Central Bank.
 Section 52, R.A. No. 7653 a. Application of Payment
1. 25c and above, legal tender up  Designation of the debt to which the
to P50 payment must be applied when the
2. 10c and below, legal tender up debtor has several obligations of the
to P20 same kind in favor of the same
creditor.
Extraordinary inflation or deflation  Requisites:
 unusual or beyond the common a. there must be only 1 debtor &
fluctuation in the value of currency, only 1 creditor;
which the parties could not have b. there must be 2 or more debts of
reasonably foreseen or which was the same kind;
manifestly beyond their c. all of the debts must be due;
contemplation at the time the except: if there’s stipulation to
obligation was established. the contrary; or application of
 Applies only to contractual payment is made by the party
obligations for whose benefit the term has
 Requisites: been constituted; and
a. The decrease in the value of the d. amount paid by the debtor must
currency could not have been not be sufficient to cover the
reasonably foreseen by the total amount of all the debts.
parties or beyond their
contemplation at the time the GENERAL RULE: The right to designate
obligation was established ; the debt to which the payment shall be
b. There must be a declaration of applied primarily belongs to the debtor.
such extraordinary inflation or EXCEPTION: If the debtor does not avail
of such right and he accepts from the
creditor a receipt in which the
application is made.
deflation by the Bangko Sentral.
Without such declaration, the Legal Application of Payment (ART1254)
creditors cannot demand an 1. If neither the debtor nor the creditor
increase, and debtors a makes any application of payment,
decrease, of what is due to or or if it cannot be inferred from other
from them. (Ramos vs. CA, 275 circumstances, the debt which is
SCRA 167 and Mobil Oil Phils. vs. most onerous to the debtor, among
CA, 180 SCRA 651) those which are due, shall be
deemed to have been satisfied.
Place of payment 2. If the debts due are of the same
1. Place stipulated by the parties. nature and burden, payment shall be
2. No stipulation and the obligation is applied to all of them
to deliver a determinate thing, proportionately.
payment shall be made at the place
where the thing might be at the time b. Dation in Payment (DACION EN
the obligation was constituted. PAGO)
3. In any other case, the payment shall  Delivery and transmission of
be made at the domicile of the ownership of a thing by the debtor
debtor. to the creditor as an accepted
equivalent of the performance of the
Special Forms of Payment: obligation.
a. Application of payment  Requisites:
b. Dation in Payment a. existence of a money obligation
c. Payment by Cession

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT

CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

b. alienation to the creditor of a by law, after the tender of payment

property by the debtor with the has been refused or because of
consent of the former circumstances which render direct
c. satisfaction of the money payment to the creditor impossible
obligation of the debtor or inadvisable.
 It is the principal act and judicial in
c. Payment by Cession character.
 Debtor abandons all of his property
for the benefit of his creditors in  Special Requisites:
order that from the proceeds a. The debt sought to be paid must
thereof, the latter may obtain be due;
payment of their credits. b. There must be a valid and
 Requisites: unconditional tender of payment
a. plurality of debts or any of the causes stated by
b. partial or relative insolvency of law for effective consignation
the debtor without previous tender of
c. acceptance of the cession by payment exists;
the creditors c. The consignation of the thing
due must first be announced to
DATION IN PAYMENT BY the persons interested in the
PAYMENT CESSION fulfillment of the obligation;
d. Consignation shall be made by
1. one creditor 1. plurality of depositing the things due at the
creditors disposal of judicial authority;
and
2. not necessarily 2. debtor must be
in state of financial partially or e. The consignation having been
difficulty relatively insolvent made, the interested parties
shall also be notified thereof.
3. thing delivered 3. universality of
is considered as property of debtor is  Effects of consignation:
equivalent of what is ceded 1. If the creditor accepts the thing
performance or amount deposited without
contesting the validity or
4. payment 4. merely releases efficacy of the consignation, the
extinguishes debtor for net
obligation is extinguished.
obligation to the proceeds of things
extent of the value ceded or assigned, 2. If the creditor contests the
of the thing unless there is validity or efficacy of the
delivered as agreed contrary intention consignation or if the creditor is
upon, proved or not interested or unknown or is
implied from the absent, the result is a litigation.
conduct of the If the debtor complied with all
creditor the requisites, the obligation is
extinguished.
d. Tender of Payment and Consignation
Tender of Payment GENERAL RULE: Consignation shall
 Manifestation of he debtor to the produce effects of payment only if there
creditor of his decision to comply is a valid tender of payment.
immediately with his obligation. EXCEPTIONS: (TIRAT or TRAIT)
 It is the preparatory act and 1. creditor is absent or unknown, or
extrajudicial in character. does not appear at the place of
payment
Consignation 2. creditor incapacitated to receive
 Deposit of the object of the payment at the time it is due
obligation in a competent court in
accordance with the rules prescribed
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
100 2005 CENTRALIZED BAR OPERATIONS

3. when two or more persons claim the

right to collect In Generic Obligations to Give
4. when the title of the obligation has
been lost GENERAL RULE: Obligation is not
5. when without just cause creditor extinguished because the genus of a
refuses to give a receipt thing cannot perish.
EXCEPTION: In case of generic
NOTES: obligations whose object is a particular
class or group with specific or
 It is the consignation which determinate qualities (Limited Generic
constitutes a form of payment and Obligations)
must follow, supplement or
complete the tender of payment in In Obligations to Do
order to discharge the obligation.
 A valid tender of payment has the Obligation is extinguished when
effect of exempting the debtor from prestation becomes legally or physically
payment of interest and/or impossible.
damages.
 If tender is made by means of a Effect of Relative Impossibility or
check, such tender is valid because Doctrine of Unforeseen Events (ART
it is an exercise of a right. Article 1267)
1249 is not applicable.  When the service has become
difficult as to be manifestly beyond
LOSS OF THE THING DUE the contemplation of the parties,
In Determinate Obligations to Give the obligor may also be released
therefrom, in whole or in part.
GENERAL RULE: Obligation is  Requisites:
extinguished. 1. The event or change in
 Requisites: circumstances could not have
1. The thing which is lost is been foreseen at the time of the
determinate; execution of the contract;
2. The thing is lost without the 2. It makes the
fault of the debtor; and performance of the contract
3. The thing is lost before the extremely difficult but not
debtor has incurred in delay. impossible;
3. The event must not be
EXCEPTIONS: due to the act of any of the
1. when by law, obligor is liable parties; and
even for fortuitous event; 4. The contract is for a
2. when by stipulation, obligor is future prestation.
liable even for fortuitous event;
3. when the nature of the Principle of Subjective Impossibility
obligation requires the  When there is no physical or legal
assumption of risk; loss but the thing object of the
4. when the loss of the thing is due obligation belongs to another, the
partly to the fault of the debtor; performance by the debtor of the
5. when the loss of the thing occurs obligation undoubtedly becomes
after the debtor incurred in impossible. Failure of performance is
delay; imputable to the debtor. Thus, the
6. when the debtor promised to debtor must indemnify the creditor
deliver the same thing to two or for the damages suffered by the
more persons who do not have latter. (Tolentino, Volume IV, p.
the same interest; and 336)
7. when the debt of a certain and
determinate thing proceeds from Effect of Loss on Reciprocal Obligations
a criminal offense
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

 First view (Tolentino, Volume IV, pp. a. that the characters of creditor &
337-338) – If an obligation is debtor must be in the same
extinguished by the loss of the thing person;
or impossibility of performance b. that it must take place in the
through fortuitous events, the person of either the principal
counter-prestation is also creditor or the principal debtor;
extinguished. The debtor is released and
from liability but he cannot demand c. it must be complete & definite
the prestation which has been
stipulated for his benefit. He who COMPENSATION
gives nothing has no reason to  Extinguishment in the concurrent
demand anything. amount of the obligation of those
persons who are reciprocally debtors
 Second View (JBL Reyes) – The loss and creditors of each other.
or impossibility of performance must  Requisites:
be due to the fault of the debtor. In a. there must be 2 parties, who, in
this case, the injured party may ask their own right, are principal
for rescission under Article 1191 plus creditors & principal debtors of
damages. If the loss or impossibility each other (except in case of
was due to a fortuitous event, the guarantor, Article 1280);
other party is still obliged to give the b. both debts must consist in
prestation due to the other. money, or if the things due are
fungibles, they must be of the
CONDONATION OR REMISSION OF THE same kind & quality;
DEBT c. both debts must be due;
 An act of pure liberality by virtue of d. both debts must be liquidated &
which the obligee, without receiving demandable;
any price or equivalent, renounces e. there must be no retention or
the enforcement of the obligation, controversy commenced by 3rd
as a result of which it is extinguished persons over either of the debts
in its entirety or in that part or & communicated in due time to
aspect of the same to which the the debtor; and
remission refers. f. compensation must not be
 It is the gratuitous abandonment by prohibited by law.
the creditor of his right.
 Requisites: Compensation Confusion
a. It must be gratuitous 1. two persons 1. one person
b. It must be accepted by the who are mutual where qualities of
debtor debtors and debtor and creditor
c. The obligation must be creditors of each are merged
demandable other
2. there must be 2. only one
NOTE: Express condonation or remission at least two obligation
must comply with the formalities of obligations
donation.
Compensation Payment
CONFUSION OR MERGER OF RIGHTS 1. The requisites prescribe by law for
 Merger of the characters of the compensation are different from those
creditor and the debtor in one and prescribed by law for payment.
the same person by virtue of which 2. Takes effect by 2. Takes effect by
operation of law act of the parties
the obligation is extinguished.
3. Capacity to 3. Capacity to give
 Requisites: give and to and to acquire is
acquire is not essential
necessary
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
102 2005 CENTRALIZED BAR OPERATIONS

4. As a rule, it is 4. As a rule, can renounce his right to oppose the

partial complete and compensation and he himself can set
indivisible it up. It differs from conventional
compensation because it is unilateral
while the latter depends upon the
Compensation Counterclaim agreement of both parties.
(Tolentino, Volume IV, p. 367)
1. Requires 2 1. Not necessary
debts must consist
in money or if
NOVATION
fungibles, same  Substitution or change of an
kind and quality obligation by another, resulting in its
extinguishment or modification,
2. Both debts 2. Does not require either by changing its object or
must be that debts be principal conditions, or by
liquidated liquidated substituting another in place of the
debtor, or by subrogating a third
3. Need not be 3. Must be pleaded person in the rights of the creditor.
pleaded to be effectual
 Requisites:
a. a previous valid obligation;
b. agreement of the parties to the
Kinds of Compensation
new obligation;
1. Legal – takes effect by operation
c. extinguishment of the old
of law
obligation; and
2. Voluntary – agreed upon by the
d. validity of the new obligation.
parties
3. Judicial – takes effect by judicial
Kinds:
decree
1. As to its essence
4. Facultative – when it can be
a. Objective/Real - refers to the
claimed by one of the parties
change either in the cause,
who, however, has the right to
object or principal conditions of
object to it
the obligations
b. Subjective/Personal - refers to
Debts not subject to Compensation:
the substitution of the person of
1. debts arising from contracts of
the debtor or to the subrogation
deposit
of a 3rd person in the rights of
2. debts arising from contracts of
the creditor
commodatum
c. Mixed
3. claims for support due by
2. As to its form/constitution
gratuitous title
a. Express - when it is declared in
4. obligations arising from criminal
unequivocal terms that the old
offenses
obligation is extinguished by a
5. certain obligations in favor of
new one w/c substitutes the
government
same.
NOTE: Taxes are not subject to set-off
b. Implied - when the old & new
or legal compensation because the
obligation are incompatible w/
government & taxpayers are not
each other on every point.
mutually creditors & debtors of each
other (Francia vs. IAC, 162 SCRA 753).
Test of Incompatibility
 Whether or not the old and new
Facultative Compensation
obligations can stand together, each
 This is compensation which can be
having its own independent
set up only at the option of a
existence. If they can stand
creditor, when legal compensation
together, there is no incompatibility;
cannot take place because of want
consequently, there is no novation.
of some legal requisites for the
If they cannot stand together, there
benefit of the creditor. The latter
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

is incompatibility; consequently, 1300 to 1304 1624 to 1627

there is novation.
2. debtor’s consent 2. debtor’s consent
Forms of Substitution of Debtors: is required is not required
1. Expromision - effected with the
3. extinguishes the 3. transmission of
consent of the creditor at the
obligation and gives right of the creditor
instance of the new debtor even rise to a new one to third person
without the consent or even without modifying or
against the will of the old extinguishing the
debtor. obligation
Requisites:
a. Initiative for substitution must 4. defects and 4. defects and vices
emanate from the new debtor vices in the old in the old obligation
b. Consent of the creditor to the obligation are cured are not cured
substitution 5. takes effect 5. as far as the
upon moment of debtor is concerned,
2. Delegacion - effected with the
novation or takes effect upon
consent of the creditor at the subrogation notification
instance of the old debtor, with
the concurrence of the new  Kinds of Subrogation
debtor. 1. Conventional – takes place by
Requisites: agreement of the parties; this kind
a. Initiative for substitution must of subrogation requires the
emanate from the old debtor intervention and consent of 3
b. Consent of the new debtor persons: the original creditor, the
c. Acceptance by the creditor new creditor and the debtor.
2. Legal – takes place without
Effect of insolvency of new debtor agreement but by operation of law
1. Expromision – the new debtor’s because of certain acts (Article
insolvency or nonfulfillment of 1302).
the obligation shall not revive
the original debtor’s liability to GENERAL RULE: Legal subrogation
the creditor whether the cannot be presumed.
substitution is effected with or EXCEPTIONS:
without the knowledge or 1. Creditor pays another creditor who is
against the will of the original preferred, without debtor’s
debtor. knowledge;
2. Delegacion – the creditor can sue the 2. A third person not interested in the
old debtor only when the obligation pays with the express or
insolvency was prior to the tacit approval of the debtor; or
delegation and publicly known or 3. Even without debtor’s knowledge, a
when the old debtor knew of person interested in the fulfillment
such insolvency at the time he of the obligation pays without
delegated the obligation. prejudice to the effects of confusion
as to the latter’s share.
NOTE: A change in the incidental
elements of, or an addition of such
elements to an obligation, unless
II. CONTRACTS
otherwise expressed by the parties, will
not result in its extinguishment. CONTRACT
 A contract is a meeting of minds
between two persons whereby one
CONVENTIONAL ASSIGNMENT OF
binds himself, with respect to the
SUBROGATION RIGHTS
other, to give something or to render
1. governed by Arts. 1. governed by Arts. some service (Article 1305).

CIVIL LAW COMMITTEE

 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
104 2005 CENTRALIZED BAR OPERATIONS

 Elements a. the stipulation must be a

1. Essential – those without which part, not the whole of
there can be no contract. the contract;
a. Consent b. the contracting parties
b. Object or Subject Matter must have clearly and
c. Cause or Consideration deliberately conferred a
2. Natural – those derived from the favor upon a third
nature of the contract and ordinarily person, not a mere
accompany the same. incidental benefit or
3. Accidental – those which exist only interest;
when the parties expressly provide c. the third person must
for them for the purpose of limiting have communicated his
or modifying the normal effects of acceptance to the
the contract. obligor before its
revocation;
Nominate contracts d. the favorable stipulation
 Those which have their own should not be
distinctive individuality and are conditioned or
regulated by special provisions of compensated by any kind
law. of obligation whatever;
Innominate contracts and
 Those which lack individuality and e. neither of the
are not regulated by special contracting parties bears
provisions of law. the legal representative
 Regulated by the stipulations of the or authorization of the
parties, by the general provisions of third person.
the Civil Code on obligations and
contracts, by rule governing the Test of Beneficial Stipulation – the
most analogous nominate contracts fairest test to determine whether the
and by the customs of the place. interest of a 3rd person in a contract is a
 Kinds: stipulation pour atrui or merely an
a. Do ut des - I give that you give incidental interest is to rely upon the
b. Do ut facias - I give that you do intention of the parties as disclosed by
c. Facio ut des - I do that you give their contract. Determine whether the
d. Facio ut facias - I do that you do contracting parties desired to tender him
NOTE: According to some such an interest (Uy Tam vs. Leonard, 30
authorities. do ut des in no longer an Phil. 471).
innominate contract. It has already
been given a name of its own, i.e. 2. When a third person induces a
barter or exchange (Article 1638). party to violate contract
(ART1314)
Characteristics of Contracts: (ROMA)  Requisites:
1. Relativity (ART 1311) a. Existence of a valid contract;
2. Obligatory Force and Consensuality b. knowledge of contract by
(ART 1315) third person; and
3. Mutuality (ART 1308) c. interference by third person
4. Autonomy (ART 1306) without legal justification or
Relativity excuse.
GENERAL RULE: Contracts take effect 3. Third persons who come into
only between parties, their assigns and possession of the object of the
heirs. contract creating real rights
EXCEPTIONS: 4. Contracts entered into in fraud
1. Stipulation pour atrui - of creditors
stipulation in favor of a third
person. Mutuality
 Requisites:
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

 The contract must bind both parties; NOTE: Offer/proposal may be withdrawn
its validity or compliance must not so long as the offeror has no knowledge
be left to the will of one of them. of acceptance by offeree.
(ART 1308) Acceptance
 The contract cannot have any  Manifestation by the offeree of his
stipulation authorizing one of the assent to the terms of the offer.
contracting parties (a) to determine  It must me absolute.
whether or not the contract shall be  A qualified acceptance constitutes
valid, or (b) to determine whether counter-offer.
or not the contract shall be fulfilled.
NOTE: Acceptance may be revoked
Autonomy before it comes to the knowledge of the
 The parties are free to stipulate offeror.
anything they deem convenient
Amplified Acceptance
provided that they are not contrary
 Under certain circumstances, a mere
to law, morals, good customs, public
amplification on the offer must be
order and public policy. (ART 1306)
understood as an acceptance of the
original offer, plus a new offer which
Consensuality
is contained in the amplification.
 Contracts are perfected by mere
(Tolentino, Volume IV, p. 452)
consent and from that moment, the
Rule on Complex offers
parties are bound not only to the
1. Offers are interrelated – contract is
fulfillment of what has been
perfected if all the offers are
expressly stipulated but also to all
accepted.
consequences which, according to
2. Offers are not interrelated – single
their nature may be in keeping with
acceptance of each offer results in a
good faith, usage and law.
perfected contract unless the offeror
has made it clear that one is
CONSENT
dependent upon the other and
 Manifested by the concurrence of
acceptance of both is necessary.
the offer and acceptance upon the
thing and the cause which are to
NOTES:
constitute the contract.
 Requisites:  Consensual contracts are perfected
a. Legal capacity of the contracting from the moment there is a
parties manifestation of concurrence
b. Manifestation of the conformity between the offer and the
of the contracting parties acceptance regarding the object and
c. The parties’ conformity to the the cause.
object, cause, the terms and  Real contracts like deposit, pledge
conditions of the contract must and commodatum requires delivery
be intelligent, spontaneous and of object for perfection.
free from all vices of consent  Solemn contracts are those which
d. The said conformity must be real requires compliance with certain
and not simulated or fictitious formalities prescribed by law, such
prescribed form being an essential
Offer element (i.e., donation of real
 A proposal made by one party to property).
another to enter into a contract.  An offer made inter praesentes must
 It must be certain or definite, be accepted IMMEDIATELY. If the
complete and intentional. parties intended that there should
be an express acceptance, the
contract will be perfected only upon
knowledge by the offeror of the
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
106 2005 CENTRALIZED BAR OPERATIONS

express acceptance by the offeree of stated in a contract that they were

the offer. An acceptance which is of age), not merely constructive.
not made in the manner prescribed
by the offeror is NOT EFFECTIVE BUT VICES OF CONSENT (VIMFU)
A COUNTER-OFFER which the offeror 1. Violence - when in order to wrest
may accept or reject. (Malbarosa vs. consent, serious or irresistible force
CA, et al., G.R. # 125761, April 30, is employed.
2003) 2. Intimidation - when 1 of the
 Contracts under the Civil Code contracting parties is compelled by
generally adhere to the Cognition a reasonable & well-grounded fear
Theory (contract is perfected from of an imminent & grave evil upon his
the moment the acceptance comes person or property, or upon the
to the knowledge of the offeror), person or property of his spouse,
while transactions under the Code of descendants or ascendants, to give
Commerce use the Manifestation his consent.
Theory (it is perfected from the 3. Mistake - should refer to the
moment the acceptance is declared substance of the thing which is the
or made). object of the contract, or to those
conditions which have principally
PERSONS INCAPACITATED TO GIVE moved one or both parties to enter
CONSENT: into the contact.
1. Minors  Must be mistake of fact and not of
EXCEPTIONS: law, except under Article 1334.
 Contracts where the minor is  Requisites under Article 1334:
estopped to raise minority as a a. Mistake must be with respect
defense through his own to the legal effect of an
misrepresentation agreement
 Contracts for necessaries b. Mistake must be mutual
 Contracts by guardians or legal c. Real purpose of the parties
representatives must have been frustrated.
 Voluntary fulfillment of a natural 4. Fraud - when, through insidious
obligation provided that the words or machinations of 1 of the
minor is between 18-21 years of contracting parties, the other is
age induced to enter into a contract
 Contracts of life, health or which, without them, he would not
accident insurance taken on the have agreed to.
life of the minor 5. Undue influence - when a person
2. Insane or demented persons, unless takes improper advantage of his
the contract was entered into during power over the will of another,
a lucid interval depriving the latter of a reasonable
3. Deaf-mutes who do not know how to freedom of choice.
read and write
Reluctant Consent
Effect of Misrepresentation of Age by  A contract is valid even though one
the Minor of the parties entered into it against
 Misrepresentation by minors with his wishes and desires or even
regard to their age when entering against his better judgment.
into a contract shall bind them in Contracts are also valid even though
the sense that they are estopped they are entered into by one of the
subsequently from impugning the parties without hope of advantage or
validity of the contract on the profit. (Martinez vs. Hongkong and
ground of minority. It is necessary Shanghai Bank, 15 Phil. 252)
that the misrepresentation must be
active (e.g. when minors specifically
Simulation of Contracts

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT

CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

1. Absolute – when the contracting

parties do not intend to be bound by  Rules:
the contract at all. Thus, an 1. In onerous contracts, the cause is
absolutely simulated contract is understood to be, for each
VOID. contracting party, the prestation of
2. Relative – when the contracting promise of a thing or service by the
parties conceal their true other.
agreement. A relatively simulate 2. In remuneratory contracts, the
contract binds the parties to their service or benefit w/c is
real agreement, when it does not remunerated.
prejudice a 3rd person and is not 3. In contracts of pure beneficence,
intended for any purpose contrary to the mere liberality of the donor or
law, morals, good customs, public benefactor.
order or public policy. 4. In accessory contracts (mortgage or
pledge), the cause is identical with
OBJECT the cause of the principal contract,
 The thing, right or service which is that is, the loan from which it
the subject matter of the obligation derives its life and existence.
arising from the contract.
 Requisites: CAUSE EFFECT
a. It must be w/in the commerce of the contract confers
man 1. Absence of cause no right and produces
no legal effect
b. It must be licit or not contrary
does not render the
law, morals, good customs,
2. Failure of cause contract void
public order or public policy the contract is null
c. It must be possible 3. Illegality of cause and void
d. It must be determinate as to its the contract is void,
kind 4. Falsity of cause unless the parties
show that there is
Things which Cannot be the Object of another cause which
Contract is true and lawful
1. Things which are outside the does not invalidate
commerce of men 5. Lesion the contract, unless
(a) there is fraud,
2. Intransmissible rights
mistake or undue
3. Future inheritance, except in influence; or (b)
cases expressly authorized by when the parties
law intended a donation
4. Services which are contrary to or some other
law, morals, good customs, contract
public order or public policy
5. Impossible things or services
6. Objects which are not possible of FORM OF CONTRACTS
determination as to their kind GENERAL RULE: Contracts shall be
obligatory, in whatever form they may
CAUSE have been entered into, provided all the
 The immediate, direct and most essential requisites for their validity are
proximate reason which explains and present.
justifies the creation of obligation. EXCEPTIONS:
 Requisites 1. When the law requires that a
a. Cause should be in existence at contract be in some form in order
the time of the celebration of that it may be valid
the contract 2. When the law requires that a
b. Cause should be licit or lawful contract be in some form in order
c. Cause should be true that it may be enforceable

CIVIL LAW COMMITTEE

 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
108 2005 CENTRALIZED BAR OPERATIONS

 Requisites:
NOTES: a. meeting of the minds to the
contract
 Parties may compel each other to b. true intention is not expressed in
comply with the form required once the instrument by reason of
the contract has been perfected. mistake, accident, relative
(Article 1357) simulation, fraud, or inequitable
 Contracts under Art 1358 which are conduct
required to be in some specific form c. clear and convincing proof of
is only for the convenience of parties mistake, accident, relative
and does not affect its validity and simulation, fraud, or inequitable
enforceability as between them. conduct

RA 8792 (E- COMMERCE ACT) provides Instances when there can be no

that the formal requirements to make reformation:
contracts effective as against third 1. Simple unconditional donations
persons and to establish the existence of inter vivos;
a contract are deemed complied with 2. Wills;
provided that the electronic document is 3. When the agreement is void;
unaltered and can be authenticated as
to be usable for future reference. When one of the parties has brought an
action to enforce the instrument, no
REFORMATION OF INSTRUMENTS subsequent reformation can be asked.

COMPARATIVE TABLE OF DEFECTIVE CONTRACTS

VOID VOIDABLE RESCISSIBLE UNENFORCEABLE

1. Defect is caused Defect is caused by vice Defect is caused by Defect is caused by

by lack of essential of consent injury/ damage either lack of form,
elements or illegality to one of the parties of authority, or capacity
to a 3rd person of both parties not
cured by prescription

2. Do not, as a Valid and enforceable Valid and enforceable Cannot be enforced

general rule produce until they are annulled until they are rescinded by a proper action in
any legal effect by a competent court by a competent court court

3. Action for the Action for annulment or Action for rescission Corresponding action
declaration or nullity defense of annulability may prescribe for recovery, if there
or inexistence or may prescribe was total or partial
defense of nullity or performance of the
inexistence does not unenforceable
prescribe contract under No. 1
or 3 of Article 1403
may prescribe

4. Not cured by Cured by prescription Cured by prescription Not cured by

prescription prescription

5. Cannot be ratified Can be ratified Need not be ratified Can be ratified

6. Assailed not only Assailed only by a Assailed not only by a Assailed only by a
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

by a contracting contracting party contracting party but contracting party

party but even by a even by a third person
third person whose who is prejudiced or
interest is directly damaged by the
affected contract

7. Assailed directly Assailed directly or Assailed directly only Assailed directly or

or collaterally collaterally collaterally

passed legally to the possession

RESCISSIBLE CONTRACTS of a 3rd person acting in good
 Contracts validly agreed upon but, faith
by reason of lesion or economic f. the action for rescission must be
prejudice may be rescinded in cases brought w/in the prescriptive
established by law. period of 4 years

What contracts are rescissible

1. those entered into by guardians BADGES OF FRAUD:
where the ward suffers lesion of 1. Consideration of the conveyance
more than ¼ of the value of the is inadequate or fictitious;
things which are objects thereof; 2. Transfer was made by a debtor
2. those agreed upon in representation after a suit has been begun and
of absentees, if the latter suffer while it is pending against him;
lesion by more than ¼ of the value 3. Sale upon credit by an insolvent
of the things which are subject debtor;
thereof; 4. Evidence of indebtedness or
3. those undertaken in fraud of complete insolvency
creditors when the latter cannot in 5. Transfer of all his property by a
any manner claim what are due debtor when he is financially
them; embarrassed or insolvent;
6. Transfer made between father &
4. those which refer to things under son, where there is present any
litigation if they have been entered of the above circumstances
into by the defendant without the 7. Failure of the vendee to take
knowledge and approval of the exclusive possession of all the
litigants and the court; property
5. all other contracts especially
declared by law to be subject to
rescission; and Rescission in Rescission Proper
6. payments made in a state of Article 1191 in Article 1381
insolvency on account of obligations 1. It is a principal 1. It is a subsidiary
action retaliatory in remedy.
not yet enforceable
character.
2. The only ground is 2. There are 5
 Requisites: non-performance of grounds to rescind.
a. the contract must be rescissible one’s obligation/s or Non-performance by
b. the party asking for rescission what is incumbent the other party is not
must have no other legal means upon him. important.
c. to obtain reparation for the 3. It applies only to 3. It applies to both
damages suffered by him reciprocal obligation unilateral and
d. the person demanding rescission reciprocal
must be able to return whatever obligations.
he may be obliged to restore if 4. Only a party to the 4. Even a 3rd person
contract may demand who is prejudiced by
rescission is granted
fulfillment or seek the contract may
e. the things w/c are the object of the rescission of the demand the
the contract must not have
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
110 2005 CENTRALIZED BAR OPERATIONS

contract. rescission of the b. such reason must have

contract. ceased and
5. Court may fix a 5. Court cannot grant c. the injured party must have
period or grant extension of time for executed an act which
extension of time for fulfillment of the expressly or impliedly
the fulfillment of the obligation.
obligation.
conveys an intention to
6. Its purpose is to 6. Its purpose is to waive his right
cancel the contract. seek reparation for 3. By loss of the thing which is the
the damage or injury object of the contract through fraud
caused, thus allowing or fault of the person who is entitled
partial rescission of to annul the contract.
the contract.
NOTE: If the object is lost through
VOIDABLE CONTRACTS fortuitous event, the contract can still
 Those in which all of the essential be annulled, but the person obliged to
elements for validity are present, return the same can be held liable only
although the element of consent is for the value of the thing at the time of
vitiated either by lack of capacity of the loss, but without interest thereon.
one of the contracting parties or by
VIMFU. UNENFORCEABLE CONTRACTS
 Those which cannot be enforced by
What contracts are voidable proper action in court unless they
1. Those where one of the parties is are ratified
incapable of giving consent to a
contract What contracts are unenforceable
2. Those where the consent is vitiated 1. those entered into in the name of
by mistake, violence, intimidation, another by one without or acting in
undue influence or fraud excess of authority;
2. those where both parties are
Causes of extinction of action to annul: incapable of giving consent; and
1. PRESCRIPTION 3. those which do not comply with the
 the action must be commenced Statute of Frauds
within 4 years from:
a. the time the incapacity Agreements within the scope of the
ends; Statute of Frauds (EXCLUSIVE LIST):
b. the time the violence, 1. Agreements not to be performed
intimidation or undue within one year from the making
influence ends; or thereof;
c. the time the mistake or 2. Special promise to answer for the
fraud is discovered. debt, default or miscarriage of
NOTE: Discovery of fraud must be another;
reckoned to have taken place from NOTE: This does not refer to the original
the time the document was or independent promise of the
registered in the office of the debtor to his own creditor. It refers
register of deeds. Registration rather to a collateral promise.
constitutes constructive notice to 3. Agreement in consideration of
the whole world. (Carantes vs. CA, marriage other than a mutual
76 SCRA 514) promise to marry;
4. Agreement for the sale of goods,
2. RATIFICATION etc. at a price not less than P500.00;
 Requisites: 5. Contracts of lease for a period
a. there must be knowledge of longer than one year;
the reason which renders 6. Agreements for the sale of real
the contract voidable property or interest therein; and

2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT

CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

7. Representation as to the credit of a What contracts are inexistent

third person. 1. Those which are absolutely
simulated or fictitious; and
NOTES: 2. Those whose cause or object did not
 The contracts/agreements under the exist at the time of the transaction.
Statute of Frauds require that the
same be evidenced by some note, NOTE: The principle of In Pari Delicto is
memorandum or writing, subscribed applicable only to void contracts and not
by the party charged or by his agent, as to inexistent contracts.
otherwise, the said contracts shall Principle of In Pari Delicto
be unenforceable. GENERAL RULE: When the defect of a
void contract consists in the illegality of
 The statute of frauds applies only to
the cause or object of the contract and
executory contracts, not to those
both of the parties are at fault or in pari
that are partially or completely
delicto, the law refuses them every
fulfilled.
remedy and leaves them where they are.
EXCEPTIONS:
Ratification of contracts in violation of
1. Payment of usurious interest
the Statute of Frauds
2. Payment of money or delivery of
1. Failure to object to the presentation
property for an illegal purpose,
of oral evidence to prove such
where the party who paid or
contracts
delivered repudiates the
2. Acceptance of benefits under these
contract before the purpose has
contracts
been accomplished, or before
any damage has been caused to
VOID CONTRACTS
a 3rd person.
 Those where all of the requisites of a
3. Payment of money or delivery of
contract are present but the cause,
property made by an
object or purpose is contrary to law,
incapacitated person
morals, good customs, public order
4. Agreement or contract which is
or public policy, or contract itself is
not illegal per se & the
prohibited or declared void by law.
prohibition is designed for the
protection of the plaintiff
What contracts are void 5. Payment of any amount in excess
1. Those whose cause, object or of the maximum price of any
purpose is contrary to law, morals article or commodity fixed by
good customs, public order or public law or regulation by competent
policy; authority.
2. Those whose object is outside the 6. Contract whereby a laborer
commerce of men; undertakes to work longer than
3. Those which contemplate an the maximum # of hours fixed by
impossible service; law.
4. Those where the intention of the 7. Contract whereby a laborer
parties relative to the principal accepts a wage lower than the
object of the contract cannot be minimum wage fixed by law.
ascertained; and 8. One who lost in gambling
5. Those expressly prohibited or because of fraudulent schemes
declared void by law. practiced on him is allowed to
recover his losses [(Art. 315, 3
INEXISTENT CONTRACTS (b), RPC] even if gambling is a
 Those where one or some or all of prohibited one.
the requisites essential for the
validity of a contract are absolutely Rules when only one of the parties is at
lacking. fault:
CIVIL LAW COMMITTEE
 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)
112 2005 CENTRALIZED BAR OPERATIONS

1. Executed Contracts: 1. Estoppel in Pais (by conduct)

a. Guilty party is barred from a. Estoppel by silence
recovering what he has given to b. Estoppel by acceptance of
the other party is barred from benefits
recovering what he has given to 2. Technical Estoppel
the other party by reason of the a. Estoppel by deed
contract. b. Estoppel by record
b. Innocent party may demand for c. Estoppel by judgment
the return for the return of d. Estoppel by laches
what he has given.
2. Executory Contracts - Neither of the
contracting parties can demand for
the fulfillment of any obligation LACHES or “STALE DEMANDS”
from the contract nor may be  Failure or neglect, for an
compelled to comply with such unreasonable and unexplained length
obligation of time, to do that which, by
exercising due diligence, could or
NATURAL OBLIGATIONS should have been done earlier; it is
 They are real obligations to which negligence or omission to assert a
the law denies an action, but which right within reasonable time,
the debtor may perform voluntarily. warranting a presumption that the
 It is patrimonial, and presupposes a party entitled to assert it either has
prestation. abandoned it or declined to assert it.
 The binding tie of these obligations
is in the conscience of man, for  Elements:
under the law, they do not have the a. Conduct on part of the
necessary efficacy to give rise to an defendant, or of one under
action. whom he claims, giving rise to
the situation of which complaint
Examples of natural obligations is made and for which the
enumerated under the Civil Code: complaint seeks a remedy
1. Performance after the civil b. Delay in asserting the
obligation has prescribed; complainant’s rights, the
2. Reimbursement of a third person for complainant having knowledge
a debt that has prescribed; or notice, of the defendant’s
3. Restitution by minor after annulment conduct and having been
of contract; afforded the opportunity to
4. Delivery by minor of money or institute a suit
fungible thing in fulfillment of c. Lack of knowledge or notice on
obligation; the part of the defendant that
5. Performance after action to enforce the complainant would assert
civil obligation has failed; the right on which he bases his
6. Payment by heir of debt exceeding suit
value of property inherited; and d. Injury to the defendant in the
7. Payment of legacy after will have event relief is accorded tot the
been declared void. complainant, or the suit in not
held to be barred
ESTOPPEL
 A condition or state by virtue of
which an admission or
representation is rendered
conclusive upon the person making it
and cannot be denied or disproved
as against the person relying
thereon.
 Kinds:
2005 CENTRALIZED BAR OPERATIONS EXECUTIVE COMMITTEE AND SUBJECT
CHAIRPERSONS
Maricel Abarentos (Over-all Chairperson), Ronald Jalmanzar (Over-all Vice Chair), Yolanda
Tolentino(VC-Acads), Jennifer Ang(VC- Secretariat), Joy Inductivo (VC-Finance), Elaine Masukat (VC-
EDP), Anna Margarita Eres (VC-Logistics). Jonathan
Mangundayao (Political Law), Francis Benedict Reotutar (Labor Law), Romuald Padilla (Civil Law),
Charmaine Torres (Taxation Law), Mark David Martinez (Criminal Law), Garny Luisa Alegre (Commercial
Law), Jinky Ann Uy (Remedial Law), Jackie Lou Bautista (Legal Ethics)
 San Beda College of Law
85

MEMORY AID IN CIVIL LAW

LACHES PRESCRIPTION

1. concerned with 1. concerned with

effect of delay fact of delay

2. question of 2. question or
inequity of matter of time
permitting the claim
to be enforced

3. not statutory 3. statutory

4. applies in equity 4. applies at law

5. not based on a 5. based on a fixed

fixed time time

CIVIL LAW COMMITTEE

 CHAIRPERSON: Romuald Padilla  ASST.CHAIRPERSON: Vida Bocar, Joyce Vidad  EDP: Alnaiza Hassiman, Dorothy
Gayon
 SUBJECT HEADS: Christopher Rey Marasigan (Persons and Family Relations), Alejandro Casabar(Property), Ma.
Rhodora
Ferrer(Wills and Succession), Ian Dominic Pua(Obligations and Contracts), Sha Elijah Dumama(Sales and Lease),
John Stephen
Quiambao(PAT), Christopher Cabigao(Credit Transactions), Ligaya Alipao(Torts and Damages), Anthony
Purganan(LTD),
Ma. Ricasion Tugadi (Conflict of Laws)