Topic 9:

Natural Obligations Estoppel Trust Prescription

Natural Obligations

Natural Obligations
Those based on equity and natural law, which do not grant a right of action to enforce their performance, but after voluntary fulfillment by the obligor, authorize the retention of what has been delivered or rendered by reason thereof. (Art. 1423)

The binding tie of these obligations is in the conscience of man, for under the law, they do not have the necessary efficacy to give rise to an action.

Two Conditions Necessary for Natural Obligations:

1. That there be a juridical tie between two persons; and 2. That this tie is not given effect by law.

Voluntary Fulfillment
It means that the debtor complied with the same even if he knew that he could not have been legally forced to do so.

Undue Payment vs. Natural Obligations

If I pay a debt that has prescribeda. Not knowing it has prescribed, I can recover on the ground of undue payment.

If I pay a debt that has prescribedb. Knowing it has prescribed, I cannot recover for this would be a case of a natural obligation.

Natural Obligation vs. Moral Obligation

Natural Obligation There is a juridical tie between the parties which is not enforceable by court action. Voluntary fulfillment of such produces legal effects which the court will recognize and protect. Moral Obligation No juridical tie whatsoever

Voluntary fulfillment of such does not produce any legal effect which the court will recognize and protect.

Examples of Natural Obligations

Performance after the civil obligation has prescribed (Art. 1424)

Reimbursement of a third person for a debt that has prescribed (Art. 1425)

Performance after action to enforce civil obligations has failed (Art. 1428)

Payment by heir of debt exceeding value of property inherited (Art. 1429)

Payment of legacy after will have been declared void (Art. 1430)

Estoppel

Estoppel
A condition or state by virtue of which an admission or representation is rendered colnclusive upon the person making it and cannot by denied or disproved as against the person relying thereon (Art 1431)

Kinds of Estoppel
a. b. Estoppel IN PAIS Estoppel BY DEED

Estoppel IN PAIS
- Equitable Estoppel - arises when one, by his acts, representations or admissions, or by his silence when he ought to speak out, intentionally or thru cuplable negligence, induces another to believe certain facts to exist, and such other rightfully relies and acts on such belief, so that he will be prejudiced if the former is permitted to deny the existence of such facts.

This may be estoppel:

By conduct or by acceptance of benefits, By representation or concealment, By silence, By omission, By laches (unreasonable delay by suing)

Estoppel BY DEED
- Technical Estoppel - It is a bar which precludes a party to a deed and his privies from asserting as against the other and his privies any right or title in derogation of the deed, or from denying the truth of any material fact asserted in it. - There must be a written instrument.

This may be estoppel by:

Deed proper (written instrument may also be in the form of a bond or a mortgage). By judgment as a court record (this happens when there could ave been RES JUDICATA).

Trust

Trust
The legal relationship between one person having an equitable ownership in a certain property and another person owning the legal title to such property.

Parties involved in the creation of a trust:

Trustor, the person who establishers the trust. Trustee, one in whom confidence is reposed as regards property for the benefit of another person. Beneficiary, the person for whose benefit the trust has been created.

Object of the Trust (Trust Res)

must consist of property, actually in existence, in which the trustor has a transferable interest or title, although as a rule, it consists of any kind of transferable property, either realty or personality, incliduing undivided, future or contingent interest therein.

Express and Implied Trust

Express trust is one created by the intention of the trustor or of the parties, whereas an implied trust is one that comes into being by operation of law.

Express and Implied Trust

Express trusts are those created by the direct and positive acts of the parties, by some writing or deed or will or by words evidencing an intention to create a trust, whereas implied trusts are those which, without being expressed, are deducible from the nature of the transaction by operation of law as matters of equity, independently of the particular intention of the parties.

Express and Implied Trust

An express trust concerning an immovable or any interes therein cannot be proved by parole evidence, whereas an implied trust concerning an immovable or any interest therein may be proved by parole evidence.

Express and Implied Trust

An action to enforce an express trust, so long as there is no express repudiation of the trust by the trustee and made known to the beneficiary, cannot be barred by laches or by the extinctive prescription, whereas an action to enfore an implied trust, even when there is no express repudiation of the trust by the trustee and made known to the beneficiary, may be barred by laches or by extinctive prescription.

Prescription

By prescription, one acquires ownership and other real rights through the last of time in the manner and under the conditions laid down by law. In the same way, rights and actions are lost by prescription. (Art. 1106)

Persons who are capable of acquiring property or rights by the other legal modes may acquire the same by means of prescription. Minors and other incapacitated persons may acquire property or rights by prescription, either personally or through their parents, guardians, or legal representatives (Art. 1107)

Real actions over immovables prescribe after thirty years. (Art. 1141) A mortgage action prescribes after ten years. (Art. 1142)

The following actions must be brought within ten years from the time the right of action accrues: 1. Upon a written contract; 2. Upon an obligation created by law; 3. Upon a judgment (5 years for motion, 610 years for action to enforce) (Art. 1144)

The following actions must be commenced within six years; 1. Upon an oral contract; 2. Upon a quasi-contract. (Art. 1145)