Lesson 2

OBLIGATIONS
General Provisions on Obligations
 Definition of Obligation
ART. 1156. An obligation is a juridical necessity to give, to do or
not to do.

• Derived from Latin word “obligatio”which means tying or

binding.
• Meaning of Juridical Necessity – it means the rights and duties
arising from obligation are legally demandable and the courts of
justice may be called upon through proper action to order the
performance.
 Nature of Obligations under Civil Code
• Civil Obligation
• Natural Obligation
 Essential Requisites of an Obligation
a) An active subject, who has the power to demand the prestation, known as the
creditor or obligee;
b) A passive subject, who is bound to perform the prestation, known as debtor or
obligor.
c) An object or the prestation which may consist in the act of giving, doing or not
doing something.
d) The vinculum juris or the juridical or legal tie between the two subjects by
reason of which the debtor is bound in favor of the creditor to perform the
prestation. It is the legal tie which constitutes the source of obligation—the
coercive force which makes the obligation demandable. It is the legal tie which
constitutes the devise of obligation… the coercive force which makes the
obligation demandable.
 Form of Obligations
• May be oral, or in writing, or partly oral and partly in writing
 Obligation, Right and Wrong Distinguished
• Obligation- the act or performance which the law will enforce
• Right –the power which a person has under the law, to demand
from another any prestation
• Wrong (cause of action)- an act or omission of one party in
violation of the legal right or rights(i.e., recognized by law) of
another also called injury.
 Obligation, Right and Wrong Distinguished
• Essential elements of legal wrong or injury
– A legal right in favor of a person (creditor/obligee/plaintiff);
– A correlative legal obligation on the part of
another(debtor/obligor/defendant);to respect or not to violate said
right;and
– An act or omission by the latter in violation of said right with resulting
injury or damage to the former
 Kinds of Obligation According to the subject Matter

1. Real obligation(obligation to give)

2. Personal obligation (obligation to do or not to do)
– Positive personal obligation
– Negative personal obligation
 Sources of Obligation
ART. 1157. Obligations arise from:
Law;
Contracts;
Quasi-contracts;
Acts or omissions punished by law; and
Quasi-delicts. (1089a)
 Sources of Obligation
1. LAW as a source of obligations –
when they are imposed by the law itself.
Examples:
It is the duty of the Spouses to support each other. (Art. 291, New
Civil Code)
And under the National Internal Revenue Code, it is the duty of every
person having an income to pay taxes.
 Sources of Obligation
2. CONTRACT as a source of obligations –

Contract as defined in Art. 1305, NCC is the meeting of minds between two person whereby one
binds himself with respect to the other,

Obligations arising from contracts have the force of law between the contracting parties because
that which is agreed upon in the contract by the parties is the law between them, thus, the
agreement should be complied with in good faith. (Art. 1159).

Although contracts have the force of law, it does not mean that contract are over and above the law.
Contracts are with the limitations imposed by law in Art. 1306, NCC, it states that the contracting
parties may establish such stipulations, clauses terms and conditions as, they may deem convenient,
provided that are not contrary to law, morals, good custom, public order or public policy.
 Sources of Obligation
3. QUASI-CONTRACTS as a source of obligations
The ‘quasi’ literally means ‘as if’.

Quasi-contract is the juridical relation resulting from a lawful, voluntary and

unilateral act which has for its purpose the payment of indemnity to the end that no
one shall unjustly enrich or benefited at the expense of another. (Art. 2142, NCC)

Contracts and quasi-contracts distinguished:

in a contract, consent is essential requirement for its validity while in quasi-contract,
there is no consent as the same is implied by law;
contract is a civil obligation while quasi-contract is a natural obligation.
 Sources of Obligation
4. DELICTS or acts or omissions punished by law as a source of
obligations
Acts or omission punished by law is known as Delict or
Felony or Crime.

While an act or omission is felonious because it is punished by law, the

criminal act gives rise to civil liability as it caused damage to another.
 Sources of Obligation
5. QUASI-DELICTS as a source of obligations

Concepts of Quasi-Delict –
Quasi-delict is one where whoever by act or omission causes
damage to another, there being fault of negligence, is obliged
to pay for the damage done. Such fault of negligence, if there is
no pre-existing contractual relation between the parties. (Art.
2176)
 Sources of Obligation
6. DELICTS or acts or omissions punished by law as a source of obligations
Acts or omission punished by law is known as Delict or Felony or Crime.
While an act or omission is felonious because it is punished by law, the
criminal act gives rise to civil liability as it caused damage to another.

Civil liability arising from delicts:

Restitution – which is the restoration of or returning the object of the crime to
the injured party.
Reparation – which is the payment by the offender of the value of the object
of the crime, when such object cannot be returned to the injured party.
• ART. 1158. Obligations derived from law are not presumed.
Only those expressly determined in this Code or in special
laws are demandable, and shall be regulated by the precepts
of the law which establishes them; and as to what has not
been foreseen, by the provisions of this Book. (1090)
 Legal Obligations
• The provisions of Art. 1158 refers to the legal obligations or
obligations imposed by specific provisions of law, which means
that obligations arising form law are not presumed and that to
be demandable must be clearly provided for, expressly or
impliedly in the law.
• ART. 1159. Obligations arising from contracts have the force
of law between the contracting parties and should be
complied with in good faith. (1091a)
 Contractual Obligations
1. Binding force- obligations arising from contract have the force
of law between the contracting parties
2. Requirement of a valid contract- when all essential elements
are present and if it is not contrary to law, morals, good
customs, public order, and moral public policy
 Compliance in good faith
• Compliance or performance in accordance with the
stipulations or terms of the contract or agreement. Sincerity
and honesty must be observed to prevent one party from
taking unfair advantage over the other.
ART. 1160. Obligations derived from quasi-contracts shall
be subject to the provisions of Chapter 1, Title XVII, of this
Book.

 Quasi-contractual obligations
• Quasi-contract is the juridical relation resulting from a lawful,
voluntary and unilateral act which has for its purpose the
payment of indemnity to the end that no one shall unjustly
enrich or benefited at the expense of another. (Art. 2142, NCC)
 Kinds of Quasi-contracts
1. Solutio Indebiti (Payment by mistake)
It is the juridical relation which arises when a person is obliged to return something received by him through error or mistake.

Example-
Arvin owed Ian the sum of P1, 000.00. By mistake, Arvin paid P2, 000.00. Ian has the obligation to return the P1, 000.00 excess
because there was payment by mistake.

2. Negotiorum gestio (management of another’s property)

It is the voluntary management or administration by a person of the abandoned business or property of another without any
authority or power from the latter. (Art. 2144, NCC)

Example-
Victor, a wealthy landowner suddenly left for abroad leaving his livestock farm unattended. Ramon, a neighbor of Victor
managed the farm thereby incurring expenses. When Victor returns, he has the obligation to reimburse Ramon for the
expenses incurred by him and to pay him for his services. It is bases on the principle that no one shall enrich himself at the
expense of another.
ART. 1161. Civil obligations arising from criminal offenses
shall be governed by the penal laws, subject to the provisions
of article 2177, and of the pertinent provisions of Chapter 2,
Preliminary Title, on Human Relations, and of Title XVIII of
this Book, regulating damages. (1092a)

 Civil Liability Arising from Crimes or Delicts
• Oftentimes, the commission of a crime causes not only moral
evil but also material damage.
• In crimes which cause no material damage (contempt, insults
to persons in authority, gambling,violations of traffic
regulation, etc.), there is no civil liability to be enforced.but a
person not criminally responsible may still be liable civilly.
Scope of Civil Liability:

Restitution – which is the restoration of or returning the object of the crime

to the injured party.
Reparation – which is the payment by the offender of the value of the object
of the crime, when such object cannot be returned to the injured party.
Indemnification – the consequential damages which includes the payment of
other damages that may have been caused to the injures party.
• ART. 1162. Obligations derived from quasi-delicts shall be
governed by the provisions of Chapter 2, Title XVIII of this
Book, and by special law. (1093a)
 Obligations arising from quasi-delicts
• Quasi-delict is one where whoever by act or omission causes
damage to another, there being fault of negligence, is obliged
to pay for the damage done. Such fault of negligence, if there is
no pre-existing contractual relation between the parties.
 Requisites of a quasi-delicts -

1. There must be an act or omission

2. There must be fault or negligence
3. There must be damaged caused
4. There must be a direct relation or connection of cause and
effect between the act or omission and the damage, and
5. There is no pre-existing contractual relation between the
parties
 Crime distinguished from quasi-delict
Crime Quasi-delict
1. Criminal or malicious intent 1. Negligence
2. Purpose is punishment 2. Indemnification of the offended party
3. Public interest 3. Private interest
4. Two liabilities: criminal and civil 4. Only civil liability
5. Can not be compromised or settled 5. Can be compromised as any other civil
by the parties themselves liability
6. The guilt of the accused must be 6. The fault or negligence of the
proved beyond reasonable doubt defendant need only be proved by
preponderance(i.e.,superior or greater
weight) of evidence