Obligations and Contracts: Remedies and Breaches

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In which situation would specific performance NOT be a viable remedy for breach of obligation?

Delivery of a unique antique car.
Delivery of 100 sacks of rice of a specified brand.
Painting a portrait by a renowned artist, where the artist refuses. (correct)
Transfer of ownership of a specific parcel of land.

What is the key difference between 'rescission' in reciprocal obligations and 'rescission' in rescissible contracts, according to the provided text?

Reciprocal obligations involve economic injury, while rescissible contracts involve substantial breach.
Reciprocal obligations are a remedy of last resort, while rescissible contracts are a primary remedy.
There is no functional difference; 'rescission' applies equally to both situations.
Reciprocal obligations are termed 'resolution' and are a primary remedy for substantial breach, while rescissible contracts are a remedy of last resort for economic injury. (correct)

When might a court award nominal damages?

To acknowledge a violation of rights, even if no other damages are proven. (correct)
To cover the precise financial loss incurred by the injured party.
To compensate for emotional distress suffered due to a breach.
To punish the breaching party for malicious behavior.

What is the critical requirement for recovering actual damages?

Proof of the specific losses incurred. (B) Signup and view all the answers

A contract contains a clause stating that any action for fraud is waived. According to the principles outlined, is this clause enforceable?

No, waivers for future fraud are void. (A) Signup and view all the answers

What characterizes dolo causante as a type of fraud?

It is the fraud used to induce a party to enter into a contract, thus affecting the contract's validity. (B) Signup and view all the answers

In what scenario would dolo incidente most likely be relevant?

When a seller misrepresents the quality of goods during contract performance. (B) Signup and view all the answers

A contractor agrees to build a house according to specific plans but uses substandard materials. What is this an example of and what are the legal consequences?

This is an example of contravention of the tenor of the obligation, making the contractor liable for damages. (D) Signup and view all the answers

In determining negligence, what is the primary factor considered when evaluating the level of diligence required?

The specific terms agreed upon by the parties involved or the standard required by law. (D) Signup and view all the answers

Which type of negligence refers to a situation where the negligence results from a breach of contract?

Culpa Contractual (B) Signup and view all the answers

In a scenario where an injured party's negligence contributes to their injury, but is not the immediate cause, what is the likely legal consequence?

The courts may reduce the amount of damages awarded to the injured party. (D) Signup and view all the answers

What distinguishes `mora solvendi ex re` from `mora solvendi ex persona`?

<code>Mora solvendi ex re</code> applies to delays in real obligations, while <code>mora solvendi ex persona</code> applies to delays in personal obligations. (D) Signup and view all the answers

Under normal circumstances, what is required for a debtor to be considered in default?

A formal demand from the creditor, either judicial or extrajudicial. (C) Signup and view all the answers

In which of the following scenarios is prior demand from the creditor NOT necessary for the debtor to be considered in default?

When the law specifically declares that demand is not necessary. (A) Signup and view all the answers

A flower shop owner agrees to provide flowers for a wedding, with the explicit understanding that the flowers must be delivered on the wedding day. If the flowers are delivered a day late, is demand necessary for the flower shop owner to be considered in default?

No, because the nature of the obligation indicates that the delivery time was a controlling motive. (D) Signup and view all the answers

In reciprocal obligations, when does one party incur delay?

When one party is ready to perform, and the other is not, the latter incurs delay. (C) Signup and view all the answers

A debtor owes a creditor a specific painting. Without the creditor's consent, a third party pays the creditor with a sculpture of equal value. Which describes the rights of the parties involved?

The obligation is extinguished, but the third party can seek reimbursement from the debtor. (B) Signup and view all the answers

A minor, without the consent of their legal guardian, attempts to pay a debt of $1,000. Which of the following is true regarding the validity of the payment?

The payment is invalid because the minor lacks the capacity to alienate property. (A) Signup and view all the answers

In which scenario is payment to a third party considered valid, thereby extinguishing the obligation between the debtor and creditor?

The creditor's conduct leads the debtor to reasonably believe the third party is authorized to receive payment. (D) Signup and view all the answers

An incapacitated person receives payment on behalf of the creditor. Under what circumstance is this payment considered valid?

The payment is valid only to the extent the incapacitated person kept the thing delivered or benefited from it. (D) Signup and view all the answers

A debtor owes a specific racehorse to a creditor. The racehorse becomes ill, and the debtor attempts to deliver a champion show dog of arguably higher value instead. Can the creditor be compelled to accept the dog?

No, the creditor cannot be compelled to receive a different thing, even if it is of the same or higher value. (A) Signup and view all the answers

A contract stipulates the delivery of 'a horse' without specifying quality. The debtor attempts to deliver a malnourished, old horse. Can the creditor refuse this delivery?

Yes, considering the purpose of the obligation and that the debtor cannot deliver a thing of inferior quality. (B) Signup and view all the answers

Which scenario exemplifies an illicit act that contravenes the tenor of an obligation?

A software developer intentionally introducing a backdoor in a system they were contracted to secure. (A) Signup and view all the answers

A famous artist is contracted to paint a portrait but decides he's too busy and proposes sending his equally talented apprentice instead. Can the obligee be compelled to accept the apprentice's services?

No, an act or forbearance cannot be substituted by another against the obligee's will. (B) Signup and view all the answers

Which event would NOT be legally considered a fortuitous event excusing non-performance of an obligation?

A critical supplier goes bankrupt, causing a manufacturing delay. (A) Signup and view all the answers

A customer offers to pay a $500 debt using one thousand 50-centavo coins. Can the creditor legally refuse this payment in the Philippines, considering legal tender laws?

No, because the New Central Bank Act states the creditor should be able to accept it. (D) Signup and view all the answers

Under what circumstance is a debtor generally held responsible for events that could not be foreseen?

When the obligation requires the assumption of risk. (D) Signup and view all the answers

In which of the following scenarios would a party be liable for a fortuitous event?

A contractor uses substandard materials, and later an earthquake destroys the building. (B) Signup and view all the answers

Which of the following is NOT explicitly listed as one of the primary modes of extinguishing obligations?

Rescission (C) Signup and view all the answers

A third person pays a debtor's obligation without the debtor's knowledge. What recourse does the third person have against the debtor?

The third person can only demand reimbursement to the extent the payment benefited the debtor. (A) Signup and view all the answers

Which of the following parties is considered to have an interest in the fulfillment of an obligation?

A guarantor who has agreed to cover the debt if the debtor defaults. (D) Signup and view all the answers

A third party attempts to pay a debtor's debt, but explicitly states they do not want to be reimbursed. What condition must be met for this payment to be valid?

The debtor must accept the payment, as it is considered a donation. (C) Signup and view all the answers

A customer attempts to pay for a P2,500 purchase using only P1 coins. According to legal tender limits, what is the maximum amount the creditor is legally obliged to accept in P1 coins?

P2,000 (D) Signup and view all the answers

A buyer owes a seller three debts: P500, P700, and P900, all of the same kind and due to the same creditor. The buyer pays P600 without specifying which debt is being paid. Which of the following principles governs how the payment is applied?

The debtor has the right to specify which debt is being paid at the time of payment, with some limitations. (C) Signup and view all the answers

When does a check produce the effect of payment and extinguish the obligation?

When the check is cleared and encashed. (D) Signup and view all the answers

In the absence of any stipulation in the contract, where should payment be made if the obligation involves the delivery of a specific, identified painting?

Wherever the painting was located when the obligation was created. (D) Signup and view all the answers

A debtor moves their domicile to a different city after incurring a debt, without informing the creditor, resulting in the creditor incurring extra expenses to collect payment. Who bears these additional expenses?

The debtor, because they changed their domicile in bad faith. (A) Signup and view all the answers

A borrower owes a lender several debts. If the borrower doesn't specify which debt a payment should cover, what limits exist regarding the right to apply payment?

The lender cannot be forced to accept partial payment of a debt. (B) Signup and view all the answers

Under which of the following circumstances would the value of currency at the time of creating an obligation be the basis of payment?

When there is extraordinary inflation or deflation and no agreement to the contrary. (B) Signup and view all the answers

What is dation in payment?

The transfer of ownership of a thing by the debtor to the creditor as an accepted equivalent of performance. (B) Signup and view all the answers

Remedy for breach: Determinate thing

Forcing performance if legally and physically possible; substitute performance not allowed.

Remedy for breach: Generic thing

Specific or substitute performance; creditor can have another deliver at debtor's cost plus damages.