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What option does an injured party have if the other party does not comply with their obligation?
What option does an injured party have if the other party does not comply with their obligation?
What must occur for a valid rescission or resolution to take place?
What must occur for a valid rescission or resolution to take place?
In what situation is rescission not available to an injured party?
In what situation is rescission not available to an injured party?
Which of the following describes a situation where rescission will not be granted?
Which of the following describes a situation where rescission will not be granted?
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What is implied about rescission in reciprocal obligations?
What is implied about rescission in reciprocal obligations?
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Which of the following is a necessary condition for rescission in reciprocal obligations?
Which of the following is a necessary condition for rescission in reciprocal obligations?
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In reciprocal obligations, what can lead to the injured party choosing fulfillment?
In reciprocal obligations, what can lead to the injured party choosing fulfillment?
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What does the term 'reciprocal obligations' imply?
What does the term 'reciprocal obligations' imply?
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What cannot happen if the period benefits both the debtor and the creditor?
What cannot happen if the period benefits both the debtor and the creditor?
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If a period benefits only the debtor, what is true?
If a period benefits only the debtor, what is true?
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Under what condition can the court fix the duration of an obligation?
Under what condition can the court fix the duration of an obligation?
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Which statement is true when the period is for the benefit of the creditor?
Which statement is true when the period is for the benefit of the creditor?
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In the scenario where D took a loan from C that is due on a specific date, what is the nature of the period?
In the scenario where D took a loan from C that is due on a specific date, what is the nature of the period?
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What happens if an obligation does not explicitly fix a period, but circumstances imply one?
What happens if an obligation does not explicitly fix a period, but circumstances imply one?
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Which of the following statements about the payment rights of the creditor is false when the period benefits them?
Which of the following statements about the payment rights of the creditor is false when the period benefits them?
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When does the obligation become void due to missing the period's specification?
When does the obligation become void due to missing the period's specification?
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When can X collect ₱10,000.00 from C?
When can X collect ₱10,000.00 from C?
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What is true about the terms of a solidary obligation?
What is true about the terms of a solidary obligation?
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When may Y collect ₱3,000.00 from A?
When may Y collect ₱3,000.00 from A?
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What is the nature of the share of Z among the solidary creditors?
What is the nature of the share of Z among the solidary creditors?
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Can a creditor pursue any solidary debtor as soon as part of the obligation becomes due?
Can a creditor pursue any solidary debtor as soon as part of the obligation becomes due?
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Which of the following statements is incorrect about solidary obligations?
Which of the following statements is incorrect about solidary obligations?
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How can A collect ₱30,000.00 from the solidary debtors?
How can A collect ₱30,000.00 from the solidary debtors?
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What happens to the obligation if one of the solidary debtors defaults?
What happens to the obligation if one of the solidary debtors defaults?
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What is the key characteristic of an obligation with a period?
What is the key characteristic of an obligation with a period?
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How does a suspensive period differ from a resolutory period?
How does a suspensive period differ from a resolutory period?
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What defines a 'day certain' in the context of obligations?
What defines a 'day certain' in the context of obligations?
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In relation to the will of the debtor, how does a period differ from a condition?
In relation to the will of the debtor, how does a period differ from a condition?
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Which of the following is an example of a suspensive period?
Which of the following is an example of a suspensive period?
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Which scenario best illustrates a resolutory period?
Which scenario best illustrates a resolutory period?
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Which statement correctly distinguishes a condition from a period?
Which statement correctly distinguishes a condition from a period?
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What happens to an obligation if a suspensive period has not expired?
What happens to an obligation if a suspensive period has not expired?
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What is a complete defense that bars a creditor from recovering obligations?
What is a complete defense that bars a creditor from recovering obligations?
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Which of the following is considered a defense derived from the nature of the obligation?
Which of the following is considered a defense derived from the nature of the obligation?
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If co-debtor A is a minor and is being sued, what defense can A claim?
If co-debtor A is a minor and is being sued, what defense can A claim?
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Which type of obligation is characterized by the ability to be performed in parts?
Which type of obligation is characterized by the ability to be performed in parts?
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What happens if the creditor forgives the debt?
What happens if the creditor forgives the debt?
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Which of the following defenses can C use if he is sued but A is a minor?
Which of the following defenses can C use if he is sued but A is a minor?
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Which situation represents a partial defense related to the debtor's obligation?
Which situation represents a partial defense related to the debtor's obligation?
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What could make an obligation unenforceable under the Statute of Frauds?
What could make an obligation unenforceable under the Statute of Frauds?
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Study Notes
Remedies of the Injured Party in Reciprocal Obligations
- The power to rescind obligations is implied in reciprocal ones, in case one of the obligors should not comply with what is incumbent upon him.
- The injured party may choose between the fulfillment and the rescission of the obligation, with the payment of damages in either case.
- The injured party may also seek rescission, even after he has chosen fulfillment, if the latter should become impossible.
- The court shall decree the rescission claimed, unless there be just cause authorizing the fixing of a period.
Reciprocal Obligations
- Reciprocal obligations arise from the same cause and in which each party is a debtor and a creditor of the other.
- Reciprocal obligations are performed simultaneously so that the performance of one is conditioned upon the simultaneous fulfillment of the other.
- If one party performs his obligation but the other does not, the party performing his obligation suffers injury by reason of the delay.
Remedies of the Injured Party
- Rescission with damages
- Rescission (more appropriately referred to as “resolution”) in reciprocal obligations is implied.
- Limitations to rescission:
- The obligation is not automatically rescinded by reason of one party’s non-fulfillment of his obligation.
- A judicial or notarial act is necessary before a valid rescission or resolution can take place.
- Rescission is not available if there is a just cause for the fixing of the period within which the debtor can comply with his obligation.
- Rescission is not available if the thing subject matter of the obligation is already in the possession of a third person who acquired it in good faith.
- Rescission will not be granted if there is a slight or casual breach of the contract.
- Fulfillment of the obligation with damages
- Example: S sold his Toyota car to B for P200,000. If B does not pay, S can sue for the payment of the price or for the rescission of the contract.
Obligation with a Period
- An obligation with a period is one whose demandability or extinguishment is subject to the expiration of the term which must necessarily come.
- There is a day certain when the obligation will arise or cease.
- Example: The period from Aug. 1 to Dec. 1, 2022, determines when the obligation will end or begin.
- Period – a space of time which determines the effectivity or extinguishment of an obligation.
- Day Certain – that which must necessarily come although it may not be known when.
- Example: The death of person which much necessarily come although it may not be known when.
Period Distinguished from Condition
- Period - An event which is certain to happen at a date known beforehand, or at a time which cannot be determined
- Condition - Uncertain event.
- Period - Merely fixes the time for the efficaciousness of an obligation.
- Condition - Causes an obligation to arise or cease.
- Period - Always refers to the future.
- Condition - May refer to a past event unknown to the parties.
- Period - Depends upon the will of the debtor, authorizes the court to fix its duration.
- Condition - Depends upon the will of the debtor, which is suspensive shall annul the obligation.
Kinds of Period
- Suspensive Period (Ex die)
- The expiration of which causes the obligation to arise.
- Cannot be demanded until the expiration of the term.
- The obligation begins only from a day certain upon the arrival of a period.
- Example: “I will give your allowance next month.”
- Resolutory Period (In diem)
- The expiration of which causes the extinguishment of the obligation.
- Demandable at once but is terminated upon the expiration of the term.
Party Benefited by the Period
- The period (time frame) is generally for the benefit of both the debtor (borrower) and the creditor (lender), unless it clearly says otherwise.
- Example: D takes a loan of P100,000 from C, due on December 31, 2022, with 12% interest. D cannot pay early, and C cannot demand payment before the due date.
When the Period is for the Benefit of One of the Parties
- Benefit of the Debtor
- The period benefits the debtor if the parties agree or it can be inferred from the obligation.
- Example: On January 1, 2022, D obtained a loan of P100,000 from C, payable on or before December 31, 2022. D can make the payment at any time before or on December 31, 2022, but C cannot require D to pay before that date.
- Benefit of the Creditor
- The period benefits the creditor if it is stipulated or can be inferred from the obligation.
- The creditor has the right to demand payment anytime before the deadline or on the last day.
- Example: On January 1, 2022, D obtained a loan of P100,000 from C, "collectible on or before December 31, 2022." C may demand payment at any time before or on December 31, 2022, but D cannot require C to accept payment before that date.
Fixing of the Period
- If the obligation does not fix a period, but from its nature and the circumstances it can be inferred that a period was intended, the courts may fix the duration thereof.
- The courts shall also fix the duration of the period when it depends upon the will of the debtor.
- The courts shall determine such period as may under the circumstances have been probably contemplated by the parties.
- Once fixed by the courts, the period cannot be changed by them.
When the Court May Fix the Period
- If the Obligation Does Not Fix a Period
- If the obligation does not specify a period but it can be inferred from its nature and circumstances that a period was intended, the court may determine the time frame.
- Example: D is obliged to construct a house for C, but no period is indicated for completion.
Solidary Obligations
- Solidary obligations are obligations where each debtor is liable for the entire obligation, and the creditor can demand payment from any one of them.
- Solidarity may exist although the creditors and the debtors may not be bound in the same manner and by the same periods and conditions.
- Solidarity can exist even if debtors and creditors are bound under different terms or conditions, as long as solidarity was agreed upon, required by law, or the nature of the obligation calls for it.
Solidarity with Different Terms
- Solidary Debtors with Different Terms:
- Example: A, B, and C are solidarily obliged to give X ₱30,000.00. Their terms are different:
- A's share: Collectible on demand
- B's share: Collectible on Christmas day next year
- C's share: Collectible if the stock market price of San Miguel shares reaches ₱160.00 per share
- The creditor can pursue any of the solidary debtors once any part of the obligation becomes due.
- Example: A, B, and C are solidarily obliged to give X ₱30,000.00. Their terms are different:
- Solidary Creditors with Different Terms:
- Example: A is obliged to give ₱9,000.00 to X, Y, and Z, who are solidary creditors. Their shares are due at different times:
- X's share: Collectible on demand
- Y's share: Due at the end of the year
- Z's share: Due when Z completes his course in Agriculture
- The same creditor can go after A as soon as any share becomes due.
- Example: A is obliged to give ₱9,000.00 to X, Y, and Z, who are solidary creditors. Their shares are due at different times:
Defenses in Solidary Obligations
- Defenses Derived from the Nature of the Obligation
- These defenses make the debtor not liable due to the invalidity, unenforceability, extinguishment, or non-existence of the obligation.
- These defenses are complete and the creditor is barred from recovering from the debtor.
- Examples:
- Illegality of Object or Causa: If the obligation involves illegal activities, it is unenforceable.
- Absolute Simulation: If the obligation is merely fictitious.
- Unenforceability under the Statute of Frauds: Certain agreements must be in writing to be enforceable.
- Payment of the Obligation: If the obligation has been fulfilled.
- Remission: If the creditor has forgiven the debt.
- Prescription: If the time limit to enforce the obligation has expired.
- Defenses Personal to the Debtor Being Sued
- These defenses may be complete or partial.
- Examples:
- Minority: If A, a minor at the time the obligation was constituted, is sued.
- Different Due Dates: If A and B owe X P120,000, with A's share due on demand and B's due on Christmas next year, and X sues B now.
- Defenses Personal to Others or Pertaining to Others' Shares
- These defenses can only be used partially and depend on the specific circumstances of the other debtors.
- Examples:
- Minority of Co-debtor
- Non-Arrival of Term
Divisible and Indivisible Obligations
- A divisible obligation – one that is susceptible of partial performance.
- The divisibility or indivisibility of the things that are the object of obligations in which there is only one debtor and only one creditor does not alter or modify the provisions of the law.
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Explore the remedies available to the injured party in reciprocal obligations through this quiz. Understand the implications of failing to fulfill obligations and the choices available for rescission or fulfillment. Test your knowledge on the conditions that affect these obligations.
