Kendra Joy B.

Sendico BSCE -4 CE Laws (Assignment) July 16, 2018

10 KINDS OF OBLIGATION

1. Pure 6. Solidary
2. Conditional 7. Divisible
3. Alternative 8. Indivisible
4. Facultative 9. Obligation w/ a period
5. Joint 10. Obligation w/ a penal clause

1. PURE OBLIGATION
- w/o condition, demandable at once (pure has resolutory condition/period)

2. CONDITIONAL OBLIGATION
- there is condition in performance; future & uncertain
2Kinds
a. Suspensive condition – happening of condition gives RISE to obligation
b. Resolutory condition – happening of condition EXTINGUISHES obligation

6 MISCELLANEOUS RULES ON CONDITIONAL OBLIGATION

1. Impossible conditions, contrary to law, shall ANNUL obligation.
2. The condition not to do an impossible thing is considered not agreed upon.
3. The condition that happens in determinate time, EXTINGUISHES obligation.
4. The condition that happens in INDETERMINATE time, obligation only effective at arrival.
5. The condition is fulfilled if DEBTOR prevents fulfillment.
6. The effect of conditional obligation, once fulfilled:
- to give: retroact to the day of constitution of obligation
- has reciprocal prestations: fruits & interests be mutually compensated
- has unilateral obligation: debtor shall give fruits & interests

RULES in case of Loss, Improvement, or Deterioration of thing during the pendency of condition
1. LOST
a. w/ debtor’s fault – damages
b. w/o debtor’s fault – extinguishes obligation

2. DETERIORATION
a. w/ debtor’s fault - (1) cancel obligation & damages; or (2) fulfill obligation w/ damages
b. w/o debtor’s fault – creditor suffer impairment

3. IMPROVEMENT
a. By nature/time – benefit to creditor
b. at expense of debtor – debtor no right than that granted to usufructuary (debtor no right to compensate amount for
improvement)

EFFECTS OF FULFILLMENT OF SUSPENSIVE CONDITION

General Rule: The obligation becomes effective retroactively to the day obligation was constituted.
Exceptions:
1. In reciprocal obligation, fruits & interests during pendency of condition shall compensate each other.
2. In unilateral obligation, debtor gets fruits & interests unless there is a contrary intent.

3 EFFECTS OF FULFILLMENT OF RESOLUTORY CONDITION

1. Extinguish obligation.
2. Both parties restore what they received plus fruits & interests.
3. The rule on L, D, or I will apply to person who has to return the thing.
When one of debtors in reciprocal obligation does not comply w/ his obligation
1. The right of injured party is (1) cancel contract & damages; or (2) fulfill obligation & damages

3 Kinds of Obligation (Accdng to PERSON OBLIGED)

1. UNILATERAL – only 1 party obliged to comply
2. BILATERAL – both parties; performance not same time
3. RECIPROCAL – both parties; performance same time

3. OBLIGATION W/ A PERIOD
- demandability/extinguishment subject to the expiration of period
PERIOD – interval of time; either suspends demandability or produces extinguishment

DAY CERTAIN – must come, not known when

7 CASES CONSIDERED TO BE “OBLIGATION W/ A PERIOD”

1. Little by little
PERIOD CONDITION
2. In partial payment
3. Payable ASAP certain uncertain
4. When I can afford it future only future/past but unknown
5. When I have the money (*influence upon obligation) (*) on the very existence of
6. When I am able to only upon its demandability obligation itself
7. When my means permit me to do so

FOR WHOSE BENEFIT IS THE PERIOD?

General Rule: Both the debtor & creditor.
Therefore, NEITHER of them can demand performance of obligation.
Exception: If the term of obligation has to favor one of them.

5 INSTANCES WHEN DEBTOR LOSES RIGHT TO USE “PERIOD”

1. Debtor is insolvent.
2. Debtor attempts to abscond. ALTERNATIVE OBLIGATION FACULTATIVE OBLIGATION
3. Impairment of guarantees/securities. several prestations due, one prestation due, but can
4. Failure to furnish guarantees/securities promised. giving one is sufficient be subtituted
5. Violation of undertaking. right to choose (debtor) right to choose DEBTOR ONLY
unless granted to creditor
4. ALTERNATIVE OBLIGATION If 1 of the prestation is illegal, nullity of principal carries w/ it
- w/ 2 or more prestations, only 1 is due. others may be valid, nullity of accessory/
obligation remains substitute
5. FACULTATIVE OBLIGATION loss/impossibility of ALL loss/impossibility of presta-tion
- w/ ONLY 1 prestation but can be substituted. prestations due, w/o debtor’s due, w/o debtor’s fault,
fault, extinguishes obligation extinguishes obligation
ALTERNATIVE prestations LOST w/ debtor’s fault
Creditor entitled to damages but needs ff requisites:
1. Debtor can choose.
2. All prestations lost/become impossible due to debtor’s fault.

(3) SUMMARY OF RULES, OBLIGATIONS, & RIGHTS OF DEBTOR IN ALTERNATIVE OBLIGATION

1. If 1 of prestations lost through fortuitous event, shall still be perform by choosing (creditor) from the remainder.
2. If 1 of prestations lost through debtor’s fault, creditor may claim any of remainders w/ damages.
3. If ALL prestations lost through debtor’s fault, creditor choose price w/ damages.

RULES on LOSS/DETERIORATION of the thing intended as SUBSTITUTE in FACULTATIVE OBLIGATION

1. If there is a loss/deterioration of thing intended as substitute, debtor is NOT liable if NOT HIS FAULT.
But if substitution is already made, debtor is liable for loss of substitute when in DELAY, NEGLIGENCE, or FRAUD.

6. JOINT OBLIGATION
- obligation is to be paid proportionately by debtors or to be demanded proportionately by creditors

7. SOLIDARY OBLIGATION
- each one of debtors has right to render or each one of creditors has right to demand the entire compliance w/ prestation

MAXIMS & SYNONYMS

(3) SOLIDARY OBLIGATION EXIST ONLY IF: *RULES
1. Law states MAXIMS SYNONYMS
2. Stipulation states JOINT Obligation “To each his own” proportionate
3. Nature of obligation requires SOLIDARY “One for all, all for individually &
Obligation one” collectively
2 PRESUMPTIONS THAT OBLIGATION IS JOINT
1. The debts be divided as many shares as there are debtors/creditors.
2. The debtors/creditors are distinct from one another.

8. DIVISIBLE OBLIGATION
- prestation is capable of partial performance
9. INDIVISIBLE OBLIGATION
- prestation incapable of partial performance

10. OBLIGATION W/ A PENAL CLAUSE

- one w/ accessory undertaking attached to obligation to assume greater liablity in case of breach/non-fulfillment of
obligation

3 PURPOSES OF PENAL CLAUSE

1. Ensure performance of obligation
2. Substitute for damages & interest in case of noncompli-ance
3. Penalize debtor in case of breach

In case obligation has a PENAL CLAUSE

General Rule: Penalty takes the place of damages & interest in case of non-compliance.
Exceptions:
1. Stipulation states.
2. Debtor refuse to pay penalty.
3. Debtor guilty of fraud in performance of obligation.

NULLITY OF PRINCIPAL OBLIGATION OR THE PENAL CLAUSE

Nullity of principal obligation = nullity of penal clause
Nullity of penal clause = NOT nullity of principal obligation

10 MODES OF EXTINGUISHMENT OF OBLIGATIONS

1. Payment or performance
2. Prescription
3. Compensation
4. Confusion/merger
5. Condonation/remission
6. Fulfillment of resolutory condition
7. Annulment
8. Rescission
9. Novation
10. Loss of thing due

1. PAYMENT/PERFORMANCE
- Payment means delivery of money & performance of obligation

2 PLACE OF PAYMENT
1. At place agreed upon
2. If w/o agreement
a. Object is indeterminate – paid at domicile of DEBTOR
b. Object is determinate – place of thing at the time of constitution of obligation

4 SPECIAL MODES OF PAYMENT

a. Application of payment
b. Cession
c. Tender of payment & consignation
d. Dacion in payment

a. APPLICATION OF PAYMENT
- designation of debt to w/c payment must be applied when debtor has several obligations of same kind in favor of same
creditor.

3 REQUISITES OF APPLICATION OF PAYMENT

1. Only 1 debtor & 1 creditor
2. 2 or more debts, same kind
3. All debts are due
4. Insufficient payment to exinguish ALL debts