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What is one power that guardians have regarding their wards?

  • They can annul any contract their wards enter.
  • They can enter into contracts only with state approval.
  • They can limit their wards' ability to ratify contracts.
  • They can contract on behalf of their wards. (correct)

    • What is tacit ratification?

  • Implicit acceptance through actions or behaviors. (correct)
  • Signing a contract to explicitly agree.
  • A rejection of a contract to show disapproval.
  • Formal acceptance of a contract without any action.

    • Under what condition can a minor ratify a contract?

  • Only if the other contracting party agrees.
  • Through a legal guardian's approval.
  • When they reach the age of majority. (correct)
  • By returning all benefits received from the contract.

    • What is required for express ratification compared to implied ratification?

    <p>Explicit agreement rather than conduct.</p> Signup and view all the answers

    In the case of annulment due to intimidation, who must file the action?

    <p>The minor involved in the contract.</p> Signup and view all the answers

    Which article states that ratification may be effected by the guardian of an incapacitated person?

    <p>Article 1394.</p> Signup and view all the answers

    What happens if a minor collects money from a contract they wish to annul?

    <p>The minor loses their right to annul the contract.</p> Signup and view all the answers

    What does Article 1395 state about ratification and conformity?

    <p>Ratification does not require the other party's consent.</p> Signup and view all the answers

    What is the primary purpose of rescission in a contract?

    <p>To restore parties to their original situation</p> Signup and view all the answers

    When is rescission not possible according to the content provided?

    <p>When the contract is approved by the court</p> Signup and view all the answers

    What obligation arises once a contract is rescinded?

    <p>The obligation of mutual restitution</p> Signup and view all the answers

    Which of the following statements is correct regarding the fruits of the contract?

    <p>The party who received the object is presumed to have enjoyed the fruits</p> Signup and view all the answers

    Under what condition does the obligation of a third person to restore apply?

    <p>If the third person has benefited from the contract</p> Signup and view all the answers

    What happens if the party who received the object of the contract has used its price?

    <p>They must restore the object and its value</p> Signup and view all the answers

    What does Article 1385 state about the land and damages caused?

    <p>Only the portion equivalent to the damages needs to be returned</p> Signup and view all the answers

    When can a debtor who donated property be presumed to have committed fraud?

    <p>When sufficient property is not reserved to pay debts</p> Signup and view all the answers

    What is the primary condition that must be satisfied for rescission to be granted?

    <p>There must be a validly agreed upon contract.</p> Signup and view all the answers

    Which of the following is true about unenforceable contracts?

    <p>They occupy an intermediate ground between voidable and void contracts.</p> Signup and view all the answers

    Which of the following must exist for one to claim rescission based on lesion or damage?

    <p>There must be pecuniary prejudice or damage to a party.</p> Signup and view all the answers

    What is the primary difference between annulment and rescission?

    <p>Annulment involves law; rescission involves equity.</p> Signup and view all the answers

    What is a characteristic of void or inexistent contracts?

    <p>They have no legal effect at all.</p> Signup and view all the answers

    Which of the following is NOT a requisite of rescission?

    <p>There must be a specific time limit for filing a rescission.</p> Signup and view all the answers

    Who can avail of rescission?

    <p>Contracting parties and any affected third parties.</p> Signup and view all the answers

    When does the prescriptive period for annulment begin?

    <p>From the time the defect of consent ceases.</p> Signup and view all the answers

    In which situation can rescission apply to third persons?

    <p>When damages to the third person are evident.</p> Signup and view all the answers

    What is one implication of a voidable contract?

    <p>It may be enforced under certain conditions.</p> Signup and view all the answers

    What requires ratification to prevent annulment?

    <p>Fraud incidents.</p> Signup and view all the answers

    What condition must be met for contracts entered into by minors to be annulled?

    <p>The minor must wait until he or she turns 22.</p> Signup and view all the answers

    What does rescission aim to achieve for the contracting parties?

    <p>Restoration of things to their original condition.</p> Signup and view all the answers

    Under what condition does the prescriptive period begin when fraud is involved?

    <p>From the time the fraud is discovered.</p> Signup and view all the answers

    What is the duration for bringing an action for annulment due to fraud?

    <p>Four years.</p> Signup and view all the answers

    When can an incapacitated person's contract be annulled?

    <p>When they regain capacity.</p> Signup and view all the answers

    What is restored in obligations to give between contracting parties?

    <p>The things that were the subject matter of the contract, with their fruits</p> Signup and view all the answers

    Under what condition is the action for annulment extinguished?

    <p>When the loss is through the fault or fraud of the plaintiff</p> Signup and view all the answers

    What basis will the value of services rendered provide?

    <p>The basis for damages</p> Signup and view all the answers

    What must an incapacitated party do in terms of restitution?

    <p>Only return what has been benefited from the thing received</p> Signup and view all the answers

    What is the primary condition under which rescission can be sought according to Article 1383?

    <p>The injured party must show no other legal means for satisfaction.</p> Signup and view all the answers

    Which of the following does a party liable under a decree of annulment return?

    <p>The fruits received, the value of the thing at the time of loss, and interest</p> Signup and view all the answers

    What does rescission create an obligation to return according to Article 1385?

    <p>Only the price with its interest, alongside the things of the contract</p> Signup and view all the answers

    What happens if one party does not comply with their obligation to return?

    <p>The other party is not compelled to comply with their obligation</p> Signup and view all the answers

    What is the primary aim of restitution in contractual agreements?

    <p>To restore parties to their original positions before the contract</p> Signup and view all the answers

    Under what condition will rescission not take place if the object of the contract is in the possession of a third person?

    <p>If the third party acted in good faith.</p> Signup and view all the answers

    In cases where loss occurs, what can be said about interest in regard to the obligation to return?

    <p>Interest must be included from the time of loss</p> Signup and view all the answers

    When can rescission not occur despite a party demanding it?

    <p>When the party cannot return what needs to be restored.</p> Signup and view all the answers

    What is the maximum extent to which rescission can be carried out, according to Article 1384?

    <p>Only to the extent necessary to cover the damages caused.</p> Signup and view all the answers

    In the provided example, what was the total value of the sacks of rice sold to B?

    <p>P70,000.00</p> Signup and view all the answers

    According to the scenario, how much indemnity for damages can be demanded from the person causing the loss?

    <p>Amount of the loss suffered due to lack of fulfillment.</p> Signup and view all the answers

    What must a creditor demonstrate before benefiting from rescission according to Article 1384?

    <p>That they initiated the action for rescission.</p> Signup and view all the answers

    Study Notes

    Defective Contracts

    • Contracts that are not perfectly valid, categorized by severity:
      • Rescissible Contracts: Least defective, valid until rescinded by court due to damage to a party or third party.
      • Voidable Contracts: Valid until annulled due to defects in consent.
      • Unenforceable Contracts: Can't be sued upon until ratified; intermediate defect.
      • Void or Inextant Contracts: Absolutely null and void, have no legal effect.

    Rescissible Contracts

    • Valid contracts, but can be set aside due to damage or injury to a party or third party (e.g. creditors).
    • Examples include contracts by guardians with wards experiencing significant financial harm (lesion) exceeding one-fourth property valuation and contracts made in fraud of creditors.
    • Rescission is an equitable remedy to restore parties to pre-contract state.
    • Must meet specific legal criteria to be rescinded.

    Voidable Contracts

    • Valid until annulled by court action.
    • Defects arise from issues with consent, such as:
      • Incapacity of one party (e.g., minors, insane people).
      • Vitiated consent (e.g., mistake, violence, intimidation, undue influence, fraud).
    • Voidable contracts are susceptible to ratification.

    Unenforceable Contracts

    • Valid, but cannot be enforced in court unless ratified.
    • Examples include contracts entered into by someone without proper authority or representation (e.g., a person who signed a sales contract purporting to represent someone else), and contracts that do not meet the legal requirements of the Statute of Frauds.

    Void/Inexistent Contracts

    • Absolutely null and void from the beginning, without legal effect.
    • Examples include contracts with illegal subject matter, grossly simulated contracts, contracts based on non-existent objects or services, and impossible contracts.
    • No ratification can make a void contract valid.
    • Action to declare inexistence never prescribes.

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