OBLIGATION An obligation is the juridical necessity to give, to do or not to do. (Art 1156, Civil Code).

It is a juridical necessity because, in case of non-compliance, the injured or aggrieved party may go to the courts of justice to enforce obligation, or in case of default thereof, the economic value that it represents. In a proper case, the debtor may be made liable for the payment of damages cause to the creditor for the violatiuon of the latters right. Requisites of an Obligation: 1. Passive subject, or the debtor, obligor from whom the obligation is juridically demandable. 2. Active Subject or the creditor, obligee, who can demand the fulfillment of the obligation. 3. Prestation, subject, or service which constitutes the object of the obligation. 4. Efficient cause or juridical tie, which binds the parties to the obligation and which may arise either unilateral or bilateral. SOURCES OF OBLIGATION (Art. 1157) 1. Law (Art 1158) 2. Contracts (Art 1159) 3. Quasi-contracts (Art 1160) 4. Acts of omissions punished by law (Art 1161) 5. Quasi-delicts (Art 1162) Art 1158 Obligations arising from law are not presumed. This means that obligations must be clearly set forth (express) in the Civil Code or special laws. According to Art 1158, obligation arises from law are not presumed. How can we determine whether an obligation arises from law or other source? It must be noted that in the generation (making, creation) of an obligation, there is always a concurrence (harmony, agreement) between the law which establishes or recognizes it and an act or condition upon which the obligation is based. Art 1159 Obligations arising from contracts have the force of law between the parties and should be complied with in good faith. Art 1160 Obligations derived from quasi-contract are subject to the provisions of Chapter I, Title XVII of this Book. Quasi-contract 1. it is a juridical relation 2.which arises from certain lawful, voluntary, and unilateral acts, 3. to the end that no one may be unjustly enriched or benefited at the expense of the other. Kinds of Quasi Contract: 1. Negotiorum gestio unauthorized management of others property. This takes place when a person voluntary takes charge of the management of anothers abandoned business or property without the latters consent. Reimbursement must be made to the gestor for necessary and useful expenses. 2. Solutio indebiti undue payment. This takes place when something is received when there is no right to demand it, and it was unduly delivered thru mistake. The recipient has the duty to return it. ART 1161 OBLIGATIONS ARISING FROM DELICTS

DELICTS (CRIME) Every person who is criminally liable is civilly liable. (Art 100, RPC). This is not an absolute rule. DISTINCTION BETWEEN CULPA CONTRACTUAL AND CULPA AQUILIANA CULPA CONTRACTUAL There is a pre-existing contractual relation Negligence in the performance of the obligation Source of liability is the breach of contract Proof of contract and its breach is a prima facie to warrant recovery CULPA AQUILIANA No pre-existing contractual relation The negligence is substantive and independent Source is the defendants negligent act or omission itself Negligence of defendant must be proved

Art 1162 Obligations arising from Quasi delict or tort or culpa aquiliana. QUASI-DELICT is a fault or act of negligence (or omission of care) which causes damages to another, there being no pre-existing contractual relations between the parties. CULPA 0R NEGLIGENCE - is defined as the failure to observe, for the protection of interests of another person, that degree of care, precaution, and vigilance which causes injury to another REQUISITES BEFORE A PERSON BE HELD LIABLE FOR QUASI-DELICT: 1. there must be fault or negligence 2. there must be damage or injury 3. there must be a direct relation of cause and effect between the fault and the damage or injury.

CHAPTER 2 NATURE AND EFFECT OF OBLIGATIONS Art 1163 DUTY TO EXERCISE DILIGENCE IN OBLIGATION TO GIVE Every person obliged to give something is also obliged to take care of it with the proper diligence of a good father of a family, unless the law or the stipulation of the parties requires another standard of care. Diligence required: 1. Diligence of a good father of a family 2. Required by Law 3. stipulated by the parties

Art 1164

The creditor has a right to the fruits of the thing from the time the obligation to deliver it arises. However, he shall acquire no real right over it until the same has delivered to him In obligation to give, when does the creditor acquire the right to the thing and its fruits? We must distinguish between the time when the creditor acquires a personal right to the thing and the fruits thereof and the time when he acquires a real right thereto. According to Art 1164, a creditor acquires a right to the fruits of the thing from the moment the obligation to deliver it arises. However, he shall acquire no real right over it until the same has been delivered to him. Therefore, from the moment the obligation to deliver the thing arises, the creditor has merely a personal right (jus in personam)over it including its fruits - the right to demand delivery of the thing and its fruits from the debtor. Once the thing including its fruits are delivered, he shall acquire real rights (jus in re) over it - a right that is enforceable against the whole world. As a consequence of certain contracts, it is not agreement but tradition or delivery that transfer ownership. KINDS OF DELIVERY: 1. Actual delivery (tradition) physical transfer of ownership 2. Constructive delivery physical transfer is implied a. Traditio simbolica (symbolical tradition) - as when key is given b. Traditio longa manu (delivery by mere pointing of the object) c. Tradition brevi manu possessor of the thing becomes the possessor owner d. Tradition constitutum possessorium - opposite of brevi manu, thus the possessor owner of a thing retains possession but not ownership e. Tradition by execution of public documents When does the obligation to deliver arises? 1. When the obligation is no term or condition, From the time the obligation to deliver it arises 2. If there is a term or a condition, then from the moment the term arrives of the condition happens. Art 1165 In obligations to give, what are the different rights available to the creditor? To give a determinate thing: 1. To compel specific performance. (Art 1165) 2. To ask damages in case of breach of the obligation (Art 1170) To give indeterminate thing: 1. to ask performance ( Art 1246) 2. to ask that the obligation be complied with at the expense of the debtor ( Art 1165 par 2) 3. to recover damages in case of breach ( Art 1170)

OBLIGATIONS OF THE DEBTOR:

Determinate thing 1. To deliver the thing 2. To take care of it with the proper diligence ( aRt 1163) 3. to deliver all accessions and accessories (Art 1166) 4. To pay damages in case of breach (Art 1170) Indeterminate thing: 1. to deliver a thing which must be neither of superior or inferior in quality ( Art 1246) 2. To pay damages in case of breach of the obligation ( Art 1170) EFFECT OF FORTUITOUS EVEN 1. If the object is determinate, the obligation extinguished. If the object is indeterminate it is not. EXCEPTIONS: 1.when the debtor is in default 2. when he is in bad faith ( promise dto deliver the same thing to two or more persons who do not have the same interest.

Art 1166 The obligation to give a determinate thing includes that of delivering all its accessions and accessories, even though they may not have been mentioned. Accessories those joined to the principal for the latters better use Accessions additions or improvements Art 1167 If a person obliged to do something fails to do it, the same shall be executed at his cost. This same rule shall be observed if he does it in contravention of the tenor of the obligation. Furthermore, it may be decreed that what has been poorly done be undone. POSITIVE PERSONAL OBLIGATION: Remedies of the creditor in case of non-compliance 1. ask specific compliance from the dbtor or ask another person to do the same at the formers expense 2. Ask for damages Art 1168 Negative personal Obligaiton When the obligation consists in not doing, and the obligor does what has been forbidden, it shall also be undone at his expense. Art 1169 NO DEMAND, NO DELAY Those obliged to deliver of to do something incur in delay from the time the oblige judicially or extra judicially demands from them the fulfillment of their obligation. However, the demand by the creditor shall not be necessary in order that delay may exist: 1. When the obligation or the law so provides 2. When time is the controlling motive for the establishment of the obligation 3. When the demand would be useless, as when the oblior has renderednit beyond his power to perform.

4. In reciprocal obligations, neither party incurs delay if the aother doest not comply or not ready to comply in a proper manner with what is incumbent upon him, From the moment one of the parties fulfills his obligation, delay by the other begins.

Art 1170 Sources of damages Those who in performance of their obligation are guilty of fraud, negligence, or delay those who in any manner contravene the tenor thereof, are liable for damages.

Art 1171 Liability for fraud or dolo Responsibility arising from fraud is demandable in all obligations. Any waiver for future fraud is void. Art 1172 Responsibility arising from negligence in the performance of every kind of obligation is also demandable, but such liability may be regulated by the courts, according to the circumstances. FRAUD DISTINGUISHED FROM NEGLIGENCE: DOLO OR FRAUD CULPA OR NEGLIGENCE THERE IS DELIBERATE INTENT NO MALICE, ALTHOUGH VOLUNTARY CANNOT BE MITIGATED WAIVER FOR FUTURE FRAUD IS VOID MAY BE MITAIGATED WAIVER FOR FUTURE CULPA MAY BE ALLOWED

KINDS OF CULPA 1. Culpa Contractual contractual negligence 2. culpa aquiliana ( civil negligence or tort or quasi delict 3. culpa criminal ( delict) criminal negligence Culpa contractual Negligence is incidental to the performance of the obligation There is pre-existing contract Proof needed preponderance of evidence The debtor has the duty to prove that there is no negligence Culpa aquiliana Negligence is direct, substantive and independent No pre-existing contract Proof needed preponderance of evidence Victim has to prove negligence of the defendat Culpa criminal Negligence is direct, substantive and independent of the contract No pre-existing obligation Proof needed guilt beyond reasonable doubt Accused is presumed to be innocent until the contrary is roved, prosecution has the burden of proving the negligence of the accused.

Art 1173 - Degrees of Culpa under Roman Law: 1. culpa lata grave negliogence 2. culpa levis ordinary negligence 3. culpa levissina slight negligence

Art 1174 fortuitous event - the thing perishes with its owner ( res perit domino) General Rule - no liability for a fortuitous event Exceptions: 1. provided by law 2. stipulated by the parties 3. when the nature of the obligation requires the assumption of risk

Art 1175 - usurious transaction shall be governed by special laws:

Art 1176 - The receipt of the principal without reservation of the interest shall give rise to a presumption that said interest has been paid. The receipt of later installment without reservation as to prior installment shall likewise raise the presumption that such installment have been paid. Art 1177 The creditors, after having pursued the property in possession of the debtor to satisfy their claims, may exercise all the rights and bring all the actions of the latter for the same purpose, save those whicha re inherent in his person; they may also impugn the acts which the debtor may have done to defraud them. Rights of the Creditor: 1. exact payment 2. exhaust debtors properties, generally by attachment (except properties exempt by law) 3. accion subrogatoria (subrogatory action) exercise all rights and actions except those inherent in person 4. Accion pauliana ( impugn or rescind acts or contracts done by the debtor to dfraud the creditors. Art 1178 - transmissibility of rights 1. General rule rights are transmissible 2. Exceptions: a. If the law provides b. Contract provides c. If the obligation is purely personal

KINDS OF OBLIGATIONS A. According to the Primary (main or basic) Classification in Civil Code (PCPASIDFPJ) 1. Pure 2. Conditional 3. Period 4. Alternative 5. Facultative 6. Joint 7. Solidary 8. Divisible 9. Indivisible 10. Penal Clause B. Secondary Classification by the Civil Code: 1. Unilateral vs. bilateral 2. Real Personal 3. Determinate generic 4. Positive negative 5. Legal vs conventional vs penal 6. Civil vs natural Art 1179 - Pure obligations without condition or term. Demandable at once. CONDITION uncertain events which wields (exercises) on a legal relationship. Characterize by uncertainty and futurity. TERM or PERIOD - that which necessarily must come (certainty) whether the parties know when it will happen or not. When an obligation is demandable at once? - when it is pure - When it is subject to a resolutory condition or period PAST EVENTS UNKNOWN TO THE PARTIES it does not exactly a condition. This means, future knowledge of a past event will determine whether or not an obligation will arise. CLASSIFICATION OF CONDITIONS 1. Suspensive the happening of the condition will give rise to the obligation 2. Resolutory the happening of the condition extinguishes the condition 3. potestative depends upon the will of either one of the parties 4. casual depends on chance or hazard of the will of the 3rd person 5. Divisible capable of partial performance 6. Indivisible not capable of partial performance because of the nature the thing or the intention of the parties 7. positive an act is to be performed 8. negative 9. express 10. implied 11. possible 12. impossible 13. conjunctive or compound if all conditions must be performed

14. alternative if only a few of the conditions have to be performed Art 1180 When my means permit me to do so - with a period subject to the discretion of the court of the period. Art 1181 Conditional Oligations There is a condition a. Suspensive Condition (conditions precedent or antecedent) fulfillment will give rise to obligation (rights will only be acquired upon the happening of the condition) b. Resolutory condition (conditions subsequent) fulfillment will extinguish obligation. Demandable at once. (rights already acquired are lost once the condition is fulfilled) CONDITIONAL PERFECTION OF THE CONTRACT If the perfection of a contract depends on a condition, non-fulfillment thereof means the non-perfection of the contract. Art 1182 - Potestative, casual, mixed conditions 1. Potestative suspensive on the part of the debtor VOID (I will give u P1.0M next month if I go to Boracay) 2. Potestative resolutory on the part of the debtor 3. Potestative on the part of the creditor VALID Art 1183 Effects of Impossible, unlawful conditions 1. To do an impossible or illegal thing- condition and obligation are VOID 2. Not to do an impossible or illegal thing Valid disregard the condition but obligation subsist Art 1184 Positive conditions The following extinguishes the obligation with a positive (to do an act) condition 1. Upon expiration of the time provided 2. when it become indubitable (evident) that the event will not take place Art 1185 - Negative Conditions The following will give rise to an obligation with a negative (not to do) condition 1. From the moment the indicated time has elapsed 2. when it become evident that the event cannot occur. Art 1186 Rule when debtor voluntary prevents fulfillment (constructive or presumed) The condition deemed fulfilled because one must not profit by his own fault REQUISITES: 1. voluntarily made either maliciously or not, as long as the intent to prevent is present. If done voluntarily for another purpose, this requisite is not present 2. Actually prevents the happening of the condition Art 1187 Effects of Fulfillment of Suspensive Condition Upon the happening of the suspensive condition the obligation becomes effective. 1. Retroactively but not with reference with fruits and interest and period of prescription 2. Therefore any the creditor can alienate thing from the day the agreement instituted by the parties. On the other hand, the debtor cannot alienate the thing, if he do so, it is invalid FRUITS AND INTEREST 1. In unilateral obligation, debtor gets the fruits and interest unless stipulated

2. In reciprocal Obligation fruits and interest during the pendency of the condition shall be deemed to compensate each other, even though they really be unequal NATURAL FRUITS Spontaneous products of the soil; and the young and other products of animals CIVIL FRUITS are the rents of buildings, the price of leases of land and other property and the amount of perpetual or life annuities or other similar income. INDUSTRIAL FRUITS are those produced by lands of any kind through cultivation or labor. Art 1188 Actions to preserve creditors right to recover what was paid by mistake Reason for the above article if creditor is not allowed to take appropriate actions, there is a danger that he will receive nothing, as when the objed\ct is deliberately destroyed, hidden or alienated Other appropriate actions: 1. ask for security if the debtor is about to be insolvent 2. ask the court to prevent alienation or concealment Art 1189 Rules on Loss, Deterioration, and Improvement During the Pendency of Condition This article applies only if: a. the suspensive condition is fulfilled and b.) object is specific 3 Scenarios of the Object: 1. may be lost 2. may be deteriorate 3. may be improved LOST 1. without the fault of the debtor. (obligation is extinguish under Art 1174 and Art 1189) 2. with fault of the debtor (debtor is liable for damages under Art 1170 and Art 1189) 3. Partly with and partly without fault of the debtor DEFINITION OF LOSS: PGDeuDcr 1. When it perishes 2. when it goes out of commerce (object becomes prohibited) 3. when it disappears in such a way that its existence is unknown 4. When it disappears in such a way that it cannot be recovered DETERIORATE (the original value was depreciated) 1. without fault of the debtor impairment is to be borne by the creditor 2. with fault of the debtor creditor has to option a. Rescission plus damages b. Fulfillment plus damages 3 Partly with or partly without fault of the debtor

IMPROVEMENT the debtor may remove the improvements without damage the principal, or may set off improvements against any damage. 1. by nature or by time - shall inure to the benefit of the creditor 2. through the expense of the debtor debtor shall have no other right but of that of usufruct. USUFRUCT gives the right to enjoy the property of another with the obligation of preserving its form and substance, unless the title constituting it or the law otherwise provides. The right of enjoyment to use of the things and the fruits of the thing Art 1190 Effects when resolutory Condition is Fulfilled 1. Obligation is extinguished. (as if there was never an obligation at all) 2. Parties should restore to each other what they have received. 3. Plus fruits or interest less expenses for production, gathering and preservation. 4. In case of loss, deterioration and improvement art 1189 shall apply. 5. the courts are given the power to determine the retroactivity of the fulfillment of the resolutory condition. Art 1191- Right to Rescind or Cancel in Reciprocal Obligations The right to rescind or cancel an obligation is applicable only to a reciprocal obligation, in case the non-fulfillment on the part of one. Remedies of the injured party: (alternative and not conjunctive) 1. fulfillment plus damages 2. rescission plus damages 3. Injured party who has elected performance or fulfillment, may if fulfillment is impossible still ask for rescission and vice versa. 4. If an action is brought for specific performance, the damages sought must be asked in the same action; otherwise, damages are deemed waived. Characteristics of the Right to rescind under this article: 1. exist only in reciprocal obligation 2. can only be demanded if one of the parties incur delay. 3. Right to rescind is not ABSOLUTE: Because: 3.a Trivial causes or slight breaches will not cause rescission 3.b If there be just cause for fixing the period within which the debtor can comply 3.c If the object of the obligation is now in the hands of an innocent third party who has lawful possession of the same (Possession under Art.523 means the holding of a thing or enjoyment of the right) 4. Right to Rescind: 1. Judicially if there has been delivery of the object 2. Extra-judicially no delivery yet 5. Implied or presumed to exist need not be expressly stipulated upon. 6. May be waived expressly, or impliedly Art 1192 Rule if both parties committed a breach 1. Liability of the first infractor shall be equitably tempered by the courts

2. If cannot be determined, the same shall be deemed extinguished. 3. Each shall bear his own damages. OBLIGATIONS WITH A PERIOD Art 1193 Obligation with a period Requisites: PERIOD is a certain length of time which determines the effectivity or the extinguishments of obligations. MANRESAS DEFINITION A term or a period consists in a space of time which has influence on obligations as a result of a judicial act, and either suspends their demandableness or produces their estinguishment. OBLIGATION WITH A PERIOD those consequences are subjected in one way or another to the expiration of the said term. DISTINCTION OF PERIOD AND CONDITION 1. As to fulfillment - A condition is an uncertain event, but a period is a certain event 2. with reference to time A period always refer to the future; a condition under the law may refer even to the past. 3. As to influence on the obligation - A condition causes an obligation to arise or to cease, but a period merely fixes the time or the efficaciousness of an obligation. REQUISITES OF A PERIOD a.) it must refer to the future b.) it must be certain c.) it must be possible Kinds of Period a.) Suspensive (ex die) obligation is demandable at the arrival of period b.) Resolutory (in diem) obligation is extinguished at the arrival of period c.) Definite exact date is known and given d.) Indefinite something that will surely happen, but the date of happening is unknown (ex. Death) e.) Legal period granted under the provisions of the law f.) Conventional or voluntary stipulated g.) Judicial fixed by court PERIOD OF PRESCRIPTION commences from the time the term in the obligation arrives. MOARATORIUM LAWS Purpose is to obtain postponement of the period within which to pay off obligations. A suspension of payment and an act of grace. Art 1194 rules in case of Loss, deterioration or Improvement - governed by Art 1189 Art 1195 Payment or delivery made before the Arrival of the period 1. Obligor may be recovered what he has paid, plus fruits and interests When? Before the maturity of the obligation. With regard to the interest, even after maturity. Prescription is 5 years after premature payment.

Art 1196 Benefit of the period is for both debtor and creditor 1.. General rule for the benefit of debtor and creditor (means the debtor cannot pay prematurely or the creditor cannot demand payment prematurely) Exceptions: from the tenor of the same or other circumstances it appears that the period has been established in favor of one or the other. BENEFIT OF THE DEBTOR meaning, he is required to pay only at the end of the term, but he may pay even before. - D will pay C Within 6 years BENEFIT OF THE CREDITOR

Art 1197 When the court may fix a Period - When the duration depends upon the will of the debtor - When there is no period, but it can be inferred that a period was intended WHEN THE COURT MAY NOT FIX THE PERIOD? 1. No term was specified because no term was intented 2. obligation is payable on demand 3. Art 1198 When the debtor losses the benefit of the period. (SAFIG) a.) when the debtor becomes insolvent b.) when debtor tries to abscond (run away or escape) c.) when he fails to perform undertakings d.) when he fails to give securities/collateral/guaranties e.) when collateral/guaranties given have been impaired or disappeared

Section 3 ALTERNATIVE OBLIGATIONS

Art 1199 A person alternatively bound by different prestations ahll completely perform one of them The creditor cannot be compelled to accept part of one and part of the other. Alternative obligations- one which has several prestations, but compliance of one shall extinguish the obligation

Art 1200 Right of choice general rule debtor unless stipulated Limitations: 1. impossible 2. unlawful 3. not the object of the obligation Right of choice: Generally, the debtor has the right of choice Summarize the rules, obligations,& rights if the debtor binds himself alternatively to deliver 3 objects: IF CHOICE BELONGS TO DEBTOR: -Loss is due to fortuitous Event-If all are loss, OBLIGATION IS EXTINGUISHED -If two or more objects remain, the debtor can deliver any two of the remaining -If one remain converted to pure obligation -Loss due to obligors fault -all lost debtor will pay the value of last thing lost -2 remain debtor can choose between them but with no damages -one remain, converted to pure obligation but no damages. IF CHOICE BELONGS TO CREDITOR -Loss due to fortuitous event- effects are the same with that if choice belongs to creditor -Loss due debtors fault- if all loss, the obligation converted to monetary obligation. The debtor will pay the value of any of the objects loss plus damages choose by creditor If two remain, the creditor may choose any of the remaining object plus damages, or he can choose the object lost, debtor is liable for the value plus damages - if one remains, the obligation is simple, the creditor may choose the remaining object plus damages. If he chooses anyone of the two lost, the debtor must pay the value plus damages. Loss of objects of Alternative Obligations Fortuitous event Extinguished Fault of the debtor obliged to pay the amt. Of last object lost.

Art 1201 The choice shall produce no effect except from the time it has been communicated. Art 1202 The debtor shall lose the right of choice when among the prestatons whereby he is bound only one is practicable.

Art 1203 - If through the creditors acts the debtor cannot make a choice according to the terms of the obligation, the latter may rescind the contract with damages. Art 1204 RULE IN CASE OF LOSS The creditor shall have a right to indemnity for damages when, through the fault of the debtor, all the things whicha re alternatively the object of the obligation have been lost, or the compliance of the obligation has become impossible. The indemnity shall be fixed taking as a basis the value of the last thing which disappeared Damages may also awarded Art 1205 Rules when choice is given to the creditor IF CHOICE BELONGS TO CREDITOR -Loss due to fortuitous event- effects are the same with that if choice belongs to creditor -Loss due debtors fault- if all loss, the obligation converted to monetary obligation. The debtor will pay the value of any of the objects loss plus damages choose by creditor If two remain, the creditor may choose any of the remaining object plus damages, or he can choose the object lost, debtor is liable for the value plus damages - if one remains, the obligation is simple, the creditor may choose the remaining object plus damages. If he chooses anyone of the two lost, the debtor must pay the value plus damages.

Facultative Obligation only one prestation has been agreed upon, but the debtor may render another in substitution. Art 1206 - Facultative Rule in case of loss EFFECT OF LOSS: FORTUITOUS EVENTS B4 SUBSTTN AFTER SUBS Principal extinguished Not extinguish Substituted not extinguished extinguished EFFECT OF LOSS: DEBTORS FAULT B4 SUBSTTN AFTER SUBS Principal liable for damages No liability Substituted no liability not extinguish Section 4 JOINT AND SOLIDARY Art 1207 - 1230

CHAPTER 4 Extinguishment of Obligation Art 1231 Obligations are extinguished:

1. 2. 3. 4. 5. 6.

By payment or performance By the loss of the thing due By condonation or remission of the debt By the confusion or merger of the rights of creditor and debtor By compensation By Novation

Other causes of extinguishment of obligations: 1. annulment 2. rescission 3. fulfillment of resolutory condition 4. prescription Still other causes: 1. Death in case of personal obligation 2. arrival of resolutory term 3. change of civil status 4. compromises 5. mutual desistance 6. impossibility of fulfillment 7. fortuitous event Art 1232 Payment means not only the delivery of money but also the performance, in any other name, of an obligation. Payment defined: mode of extinguishing obligations which consists of 1. delivery of money 2. performance as required by the obligation Requisites of payment: 1. there must be pre-existing obligation 2. acceptance by the creditor which is either impliedly or explicitly RULE IN PAYMENT MADE UNDER VOID JUDGMENT: - Payment is null and void.

SPECIAL MODES OF PAYMENT a.)Cession in payment selling of debtors property for the benefits of his creditors Requisites of Cession in payment: -more than one debt -more than one creditor -complete or partial insolvency of debtor -abandonment of all properties not exempt from execution. b.)tender of payment & consignation creditor refused to accept payment by the debtors without just cause, latter shall released from responsibility by consignation. Tender of Payment- it is the act of debtor offering to the creditor the things due or amount due. The debtor must show that he has in his possession the thing or money to be delivered at the time of the offer.

Consignation the act of depositing the things or amount due with the proper court, when the creditor does not desire or cannot receive it, after complying with the formalities required by law. CONSIGNATION ALONE shall provide the same effect in the ff cases: -when the creditor is absent or unknown, or does not appear at the place of payment -creditor is incapacitated to receive the payment at the time it is due. -when without just cause, he refuses to give a receipt -when two or more person claim the right to collect -when the title of the obligation has been lost. c.) Dation in payment debtor give property in lieu of his monetary debt. d.) Application of payment debtor has several debts of the same kind to one creditor. Requisites: - two or more debts - of the same kind - all debts must be due - tendered payment is not sufficient to extinguish all obligations. -