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# TITLE I. OBLIGATION ## CHAPTER 1. ### GENERAL PROVISIONS #### **ARTICLE 1156** An obligation is a juridical necessity to give, to do or not to do. Obligation- derived from the Latin word obligatio means tying or binding. It is a tie or bond by virtue which one is bound in favor of another to rende...

# TITLE I. OBLIGATION ## CHAPTER 1. ### GENERAL PROVISIONS #### **ARTICLE 1156** An obligation is a juridical necessity to give, to do or not to do. Obligation- derived from the Latin word obligatio means tying or binding. It is a tie or bond by virtue which one is bound in favor of another to render something (may consist in giving a thing, doing certain act, or not doing a certain act. #### **ESSENTIAL REQUISITES OF AN OBLIGATION** - Passive Subject (debtor or obligor) the person who is bound to the fulfillment. (Siya ang may duty sa *fulfillment* ng obligation) - Active Subject (creditor or obligor) person who is entitled to demand the *fulfillment* (Siya ang may right sa obligation) - Object or prestation (subject matter of the obligation) it may consists in giving, doing or not doing. Without the prestation, there is nothing to perform. - Juridical or legal tie (called as efficient cause) which binds or connects the parties to the obligation. **EXAMPLE:** Si A bound himself na gawin yung bahay ni B for 1M Pesos. - Si A yung passive subject( obligor) - Si B yung active subject (obligee) - pag-build ng bahay yung object or prestation - yung tapos yung agreement nilang dalawa yung juridical tie. **Suppose natapos na gawin ni A yung bahay ni B and nasa agreement nila na once matapos ni A yung bahay ni B ay magbabayad si B ng 1M kay A. So after niya matapos, si B na ang magiging passive subject (debtor) and si A naman ang active subject (creditor).** The *form* of an obligation refers to the manner in which an obligation is manifested or incurred. It may be oral, in writing, or partly oral and partly in writing. #### **ARTICLE 1157:** Obligation arise from - Law- imposed by law itself **EXAMPLE:** Obligation to pay taxes - Contracts- arise from stipulation/condition of both parties **EXAMPLE:** Obligation na magbayad ng loan or utang by virtue of an agreement. - Quasi-Contracts- retroactive arrangement between two parties who have no previous obligations to one another. (No meeting of minds) **EXAMPLE:** Obligation na ibalik mo yung pera kapag nagkamaling naibigay or naibayad sa'yo or hindi pa naman due. - Quasi-delicts- there being fault or negligence, but no contractual relation exists between the parties. **EXAMPLE:** Naglalaro ka ng baseball sa isang field, tapos accidentally tumama yung bola sa window glass ng kalapit na bahay, you are liable for the damages. #### **ARTICLE 1158** Obligations derived from law are not presumed. This provision refers to legal obligations arising from law. **EXAMPLE:** A private school has no legal obligation to provide clothing allowance to its teachers because there is no law which imposes this obligation upon schools. #### **ARTICLE 1159** Obligations arising from contracts have the force of law between the parties and they should be complied with in *good faith*. **CONTRACTUAL OBLIGATIONS:** The above article speaks of CONTRACTUAL OBLIGATIONS or obligations arising from contracts or VOLUNTARY AGREEMENTS OF THE PARTIES. **CONTRACT**- is a meeting of minds between 2 persons wherein they bound himself for other to give something or render services. - Binding Force- Obligations arising from contracts have the force of law between the contracting parties. - Requirement of a valid contract- A contract is considered *valid* if it is not contrary to law, morals, good customs, public ordered or public policy. - Breach of contract- When one or all the parties fails or refuses to comply with his obligations, *without legal reasons or justification*. **COMPLIANACE IN GOOD FAITH**- Compliance or performance in accordance with the stipulations/conditions or terms of the contract or agreement. #### **ARTICLE 1160** This provision talks about QUASI-CONTRACTS. “NO MEETING OF MINDS” A quasi-contract is that juridical relation resulting from lawful, voluntary and unilateral acts by virtue of which the parties become bound to each other to the end that no one will be unjustly enriched at the expense of another. **KINDS OF QUASI-CONTRACT** - Negotiorum Gestio- voluntary management of the property or affairs of another without the knowledge or consent of the latter. **EXAMPLE:** Si A nagpunta sa province without leaving somebody to look after his house sa Manila. While in prvince, biglang nagkaroon ng sunog na malapit sa bahay ni A. Through the effort of B (neighbor) the house of A was saved from being burned. However, si B may mga expenses from that. In this case, si A may obligation siya na i-reimburse lahat ng nagastos ni B kahit na wala siyang alam or walang consent from him, (on the principle of quasi-contract) - Solutio Indebiti- juridical relation which is cerated when something is received when there is no right to demand and was delivered only through mistake. (payment by mistake) a person obliged na to return something through error or mistake. **EXAMPLE:** Si A may utang kay B na 1k, ngayon si A binayaran niya si C sa pag- aakala na in- authorized ni B si C na tanggapin yung bayad ni A (Debtor) obligation ni C na ibalik yung binayad sakanya kasi nga payment by mistake ang nangyari. #### **ARTICLE 1161:** Civil obligations arising from criminal offenses shall be governed by the penal laws. **SCOPE OF CIVIL LIABILITY:** The extent of the civil liability for damages arising from crimes governed by the Revised Penal Code - Restitution- Pagbabayad - Reparation for the damages caused - Indemnification for consequential damages **EXAMPLE:** A stole the car of B. If si B ay na-convict, the curt will order either (1) return the car or to pay its value if it was lost or destroyed (2) pay for the damages (3) pay other damages suffered by the creditor. #### **ARTICLE 1162:** Obligations from quasi-delicts shall be governed by special law. **Quasi-delicts**- there being fault or negligence, but no contractual relation exists between the parties. **REQUISITES OF QUASI-DELICTS** - There must be an act or omission - There must be fault or negligence - There must be damaged caused - There must be direct relation or connection of cause and effect between the act or omission and the damage - There is no pre-existing contractual relation between the parties. **DISTINCTION OF CRIME AND QUASI-DELICT** - In crime, there is a criminal or malicious intent, while in quasi-delict, there is only negligence. - In crime, the purpose is punishment, while in Quasi-delict, indemnification of the offended party. - Crime affects public interest, Quasi-delict concerns private interest - In crime, there are generally 2 liabilities (criminal and civil), while in Quasi- delict, only civil liability. - Criminal liability cannot be compromised or settled by the parties, in Quasi- delict, it can be settled as any other civil liability. - In crime, the guilt of the accused must be proved beyond reasonable doubt, while in Quasi- delict, the fault or negligence need only by proved. ## CHAPTER 2. NATURE AND EFFECT OF OLIGATIONS #### **ARTICLE 1163:** Every person obliged to give something is also obliged to take care of it with proper diligence of a good father. This provision refers to an obligation specific or determinate thing. A thing is said to be determinate or specific when it is particularly or physically segregated others of the same class. A determinate thing is identified by its individuality. The debtor cannot substitute it with another although the latter's is of the same kind and quality without the consent of the creditor. **EXAMPLES:** (1) The watch I am wearing (2) My dog name Cookie (3) This cavan of rice A thing is said to be generic or indeterminate when it refers only to a class or genus to which it pertains and cannot be pointed out with particularity. The debtor can give anything of the same class as long as it is of the same kind. **EXAMPLES:** (1) A cavan of rice (2) A police dog (3) A casio watch #### **DUTIES OF DEBTOR IN OBLIGATION TO GIVE A DETERMINATE THING** - Preserve the thing- In obligation to give, the obligor has the duty to take care of the thing due with the diligence of a good father. - Diligence of a good father of a family- equated with ordinary care. - Another standard of care - Factors to be considered - Deliver the fruits of the things - Deliver the accessions and accessories - Deliver the thing itself - Answer for damages in case of non-fulfillment or breach #### **ARTICLE 1164:** The creditor has a right to the fruits of the thing from the time the obligation to deliver it arises. **DIFFERENT KINDS OF FRUITS** - Natural Fruits- spontaneous products of the soil. **EXAMPLE:** Grass, all trees, and plants on lands produced without interference of human labor. - Industrial Fruits- Those produced by lands of any kind through labor. Products of lands brought about by reason of human labor. **EXAMPLE:** Sugar cane, vegetables, rice - Civil fruits- those derived by virtue of a juridical relation **EXAMPLES:** Rents of apartment, price of leases of lands and other properties #### **RIGHTS OF CREDITOR TO THE FRUITS** The creditor is entitled to the fruits of the thing to be delivered from the time the obligation arises or constituted, the reason for this is to protect the interest of the obligee whenever the obligor commit delay or default in fulfilling his obligation. **PERSONAL RIGHT**- power or right of a person to demand from another, as a definite passive subject, the fulfillment of latter's obligation. **REAL RIGHT**- right or interest of a person over a specific thing. #### **ARTICLE 1165:** Remedies of Creditor in Real Obligation - Specific real obligation- (obligation to deliver a determinate thing) - Demand specific performance or fulfillment (if it is still possible) of the obligation with a right to indemnity for damages - Demand rescission or cancellation + a right to recover damages - Demand payment of damages only, where it is the only feasible remedy. **EXAMPLE:** A sells his phone to B for 20k. If si B refuses to comply in his obligation, B can bring an action for fulfillment in the above remedies - Generic real obligation- (obligation to deliver a generic thing) #### **ARTICLE 1166:** The obligation to give a determinate thing includes that of delivering of all its accessions and accessories. **ACCESSIONS**- fruits of a thing or additions to or improvements upon a principal thing. **EXAMPLE:** (1) AC in a car (2) trees on a land **ACCESSORIES**- things joined to or included with the principal thing for the latter's embellishment (decorations) **EXAMPLE:** (1) Key of a house (2) frame of picture #### **ARTICLE 1167:** If the obligor fails to do his obligation, the same shall be executed at his cost. This provision refers to an obligation to do, to perform an act or render a service. - The debtor fails to perform an obligation to do - The debtor performs an obligation but contrary to terms/stipulation - The debtor perform an obligation but in poor manner. #### **REMEDIS OF CREDITOR IN POSITIVE PERSONAL OBLIGATION** - If the debtor fails to comply in his obligation to do, the creditor has the right: - To have the obligation performed by himself or by another, unless there is a personal consideration involved. At the debtor's expenses. - Recover damages - In case the obligation is done in contravention/breach of the terms of the same or is poorly done, it may be ordered by the court that it can be undone if it still possible to undo what has done. #### **PERFORMANCE BY A THIRD PERSON** A personal obligation to do, like a real obligation to deliver a generic thing can be performed by a third person. **EXAMPLE:** - A binds himself to construct a house of B. There is a stipulation that the house shall have 4 bedrooms, kitchen shall be painted all gray. If A does not construct the house of B. B may ask D to construct the house at the expense of A (debtor) - Pero if ginawa naman ni A yung bahay pero hindi nasunod yung stipulations, B can ask to have it done according sa napag-usapan, if A refuses, the obligation may be performed by D at the expense of A (Debtor) - Now, if the kitchen was painted all gray but in a poor manner, B may ask A that it be undone, if A refuses, B may ask D to paint the kitchen at the expense of A (debtor) (BASTA IF EVER MAGKAROON NG NON-COMPLIANCE OR COMPLIED BUT IN A POOR MANNER, IF TUMANGGI ANG DEBTOR NA GAWIN YUNG OBLIGATION NIYA CONSIDERING ALL THE STIPULATIONS, PWEDENG IPAGAWA NI CREDITOR’YOΝ ΚΑΥ THIRD PERSON PERO EXPENSE LAHAT NI DEBTOR) #### **ARTICLE 1168:** When the obligations consists in not doing, and the obligor does what has been disallowed him, it shall also be undone at his expense. #### **REMEDIES OF CREDITOR IN NEGATIVE PERSONAL OBLIGATION** In an obligation not to do, the duty of the obligor here is to refrain himself from an act. Therefore, there is no specific performance here. The very obligation is fulfilled in not doing what is disallowed to do. Therefore, the debtor cannot be guilty of delay. #### **ARTICLE 1169** Magkakaroon lang ng delay if nag-demand na yung creditor sa debtor. If walang demand, delay will not exist. Pero may instances na hindi na kailangan magdemand ng creditor para masabi na nadelay yung debtor. - If nakasaad sa obligation nila - If yung time sa agreement is ang magdedecide kung kelan dapat talagang ifulfill yung obligation. - If hindi kayang iperform ng obligor yung demand. Sa reciprocal obligation naman, sinasabi na kapag sino man sa magkabilang party yung nagfulfill na ng obligation nila, dun na magstart yung delay sa party na di pa nakabayad. **EXAMPLE:** Si A may utang kay B tas si B may utang rin kay A. Ngayon nagbayad na si A kay B, pero si B hindi nagbayad. Delay na si B non kasi tapos na yung obligation ni A. #### **2 TYPES OF DELAY** - Ordinary Delay - kapag hindi lang nafulfill yung obligation sa napagkasunduang time. - Legal Delay - hindi pagfulfill ng obligation sa oras and nag result sa breach ng kasunduan. #### **KINDS OF DELAY** - Mora solvendi – failure sa part ng debtor dahil hindi niya natupad yung obligation - Mora accipiendi – failure naman sa part ng creditor dahil hindi niya tinanggap yung performance of the obligation - Compensatio morae – kapag nagdelay yung obligor cancelled na yung delay ng obligee and vice versa. #### **NO DELAY IN NEGATIVE PERSONAL OBLIGATION** Kapag yung obligation is not to do, possible pa yung non-fulfillment pero yung delay is impossible kasi hindi niya naman pwedeng gawin yung what has forbidden him. #### **REQUSITES OF DELAY OR DEFAULT BY THE DEBTOR** Masasabi lang na nadelay yung isang debtor if: - Kapag hindi niya tinupad yung obligation niya sa napagkasunduang date. - Kapag nag-demand sa kanya yung creditor which is either judicial or extra judicial. - Kapag hindi niya na perform yung demand. **EXAMPLE:** Si A ay obliged himself na mag-deliver ng refrigerator kay B sa December 10. Ngayon hindi nadeliver ni A yon. Ordinary delay lang ‘to kasi hindi naman nag- demand si B. Kahit na may date of fulfillment ia-assume lang ng court na nagbigay ng extension si B para sa pagdedeliver. So in the end walang breach of obligation na ginawa si A. #### **EFFECTS OF DELAY** - Mora solvendi - Kapag guilty si debtor for breach of obligation - Kapag liable siya kay creditor ng interest (kapag money yung obligation) or (damages kapag ibang type ng obligation) - Kapag fortuitous event, liable pa rin siya provided na determinate thing yung obligation. Pero kung mapapatunayan ng debtor na ganon pa din mangyayari kahit di niya kasalanan, babawasan ng court yung damages. - Mora accipiendi - Kapag guilty rin si creditor for breach of obligation. - Liable si creditor for damages na nagawa ng debtor - Siya yung may fault in case na mawala yung bagay - Kapag money yung obligation hindi liable si debtor sa interest in case na ma-delay si creditor - Pwedeng alisin ni debtor yung sarili niya sa obligation kapag nadeposit na niya sa court yung thing due. - Compensatio morae Delay sa creditor cancels the delay of the debtor or vice-versa. Kapag naunang madelay yung isang party and sinundan nung kabila, yung unang nagdelay is mababalance ng court. Pero kung hindi malaman kung sino yung naunang ma-delay, tapos na yung obligation and sila yung magbebear ng mga kanya kanya nilang damages. #### **WHEN DEMAND IS NOT NECESSARY TO PUT IN DELAY** Mangyayari lang yung delay sa part ng debtor if nag-demand si creditor. Pero kung hindi, walang mangyayaring delay. **EXCEPT:** - When the obligations so provides **EXAMPLE:** May utang si A kay B na 10k to be paid on Dec 1 (without the need of demand). Once na hindi nagbayad si A sa Dec 1, automatic delay siya. - When the alw so provides **EXAMPLE:** Sinasabi sa law na yung taxes daw are to be paid on the exact date or before non dahil kapag hindi, may penalties na. - When time is of the essence **EXAMPLE:** Delivery of balloon in a birthday party: Making of a wedding dress for a wedding scheduled at a particular time. - When demand would e useless **EXAMPLE:** Magdedeliver ng horse si A kay B sa Sunday. Namatay yung horse due to a fortuitous event. Any demand would be pointless kasi patay na nga yung idedeliver. - When there is performance by a party in *reciprocal obligations* **EXAMPLE:** Si A magdedeliver ng tv kay B. Tapos si B dapat magbayad pagkadeliver. Since wala namang napagkasunduang date, mangyayari lang yung delay if hindi nagbayad si B pagkadeliver ni A. #### **ARTICLE 1170:** Those who are guilty of fraud, negligence or delay for the performance of their obligations are liable for damages. #### **4 GROUNDS FOR LIABILITY** - Fraud (deceit or dolo) - As a ground for damages, it implies some kind of malice or dishonesty and it cannot cover cases of mistake and errors of judgment made in good faith. **EXAMPLE:** S obliged na mag-deliver kay T ng 20 cavans of rice of a particular name. If si S nag-deliver ng rice knowing that it is a cheaper rice at hindi kagaya ng napag- usapan, S is guilty of fraud and he is liable for damages of T. - Negligence (fault or culpa) any voluntary act or omission, no malice or bad faith, which prevents the normal fulfillment of an obligation. **EXAMPLE:** Si A pasahero ni B in a taxi. There is considered a contract of carriage between A and B. In consideration sa fair fare na binayad ni A, the driver (B) agreed to safely bring A sa pupuntahan niya. If dahil sa hindi pag-iingat ni B (driver) for example (mabilis siya masyado mag-dive, or dumaan siya sa one-way street lang) na nag-cause ng pagka-aksidente nila, and if si A (debtor) ay injured, si B (driver) yung liable for the damages. And if ever man na pati yung sasakyan niya ay nagkarooon ng damages, siya rin yung liable na mag-bear ng expenses doon. - Delay (Mora) - is the failure to perform an obligation on time which failure, constitutes a breach of the obligation. - Contravention of the terms of the obligation- Violation of the terms and conditions stipulated in the obligation. **EXAMPLE:** Si A tenant s apartment ni B for 5k a month na dapat bayaran every 1st week ng month. Yung obligation ni A ditto ay yung pagbabayad ayon sa napagkasunduan and yung obligation naman ni B dito ay to make sure na safe and peaceful yung apartment na 'yon for A. If si A nag-violate sa obligation niya, B is entitled to eject him from the apartment and recover damages. If si B hindi niya ginawa yung obligation niya kay A, B may be held liable for the terms of his obligation. #### **DISTINCTION OF FRAUD AND NEGLIGENCE** - In fraud, there is deliberate intention, while in negligence, there is no intention. - Waiver of the liability for future fraud is void. While such waiver be allowed in negligence. - Fraud must be clearly roved, negligence is presumed from the violation of a contractual obligation - Liability for fraud cannot reduced by the courts, while liability for negligence may be reduced according to the circumstances. #### **ARTICLE 1171:** Responsibility arising from fraud is demandable in all obligations. Any waiver for future fraud is void. **RESPONSIBILITY ARISING FROM FRAUD DEMANDABLE** Responsibility arising from fraud can be demanded with respect to all kinds of obligation. The court is not given the power to reduce the corresponding damages. **WAIVER OF AN ACTION FOR FUTURE VOID** Any waiver for future fraud is void as being against the law and public policy. **ANO YUNG REASON BAKIT VOID?** --- Syempre if yung obligor alam niya na kahit gumawa siya ng fraud or mag-violate siya, hindi siya magiging *liable* for it. And if valid yung fraud, therefore magiging non sense na ang obligation kasi nga pwedeng hindi gawin. **WAIVER OF ACTION FOR PAST FRAUD VALID** Magiging valid ang past fraud if yung waiver na nangyari ay act of generosity on the part of the party who is the victim of the fraud (obligee) If yung aggrieved party ay hindi nag-file ng case against kay obligor, ibig sabihin yung past fraud na 'yon ay valid. But para maging valid nga yon, it must be expressed in clear language which elaves no doubt as to the intention of the obligee to give up his rights against the obligor. **EXAMPE:** A obliged na mag-deliver ng 240 cavans or rice kay B of a particular brand and quality at the rate of 20 cavans kada month. If si A cannot make an agreement kay B, and si B ay hindi naman nag-file ng case against kay A. Considered 'yon na past fraud and it is valid. But if ang nangyari ay si A ay magco-commit palang ng fraud, considered ‘yon na Future fraud and therefore void ‘yon and si B can still bring an action against A for damages arising from the fraud. #### **ARTILCE 1172:** Responsibility arising from negligence in the performance of every kind of obligation is also demandable. **RESPONSIBILITY ARISING FROM NEGLIGENCE DEMANDABLE** In the performance of every kind of obligation and according to general rule, yung debtor ay liable pa rin for all the damages resulting from his negligence. Yung court ay binibigyan siya ng rights or power in fixing the measure of damages. Since negligence nga lang ang nangyari and wala namang intention doon, ibig sabihin the court may increases or decerases the damages depending sa circumstances na nangyari. If ever man na both parties ay merong negligent sa isa't-isa, naka-depende sakanila kung paano yung magiging kasunduan nila doon sa mga obligations nila sa isa't-isa. It's either i-cancel or maging neutral sila sa isa't-isa. #### **VALIDITY OF WAIVER OF ACTION ARISING FROM NEGLIGENCE** - An action for future negligence may be renounced except where the nature of the obligation requires the exercise of extraordinary diligence as in the acse of common carriers. - If yung obligation na nagakroon ng negligence acted in bad faith, it is considered equivalent to fraud. ANY ACTION FOR FUTURE NEGLIGENCE NA NAG-ACT IN BAD FAITH AY CONSIDERED AS VOID!!! #### **KINDS OF NEGLIGENCE ACCORDING TO SOURCE OF OBLIGATION** - Contractual Negligence (culpa contractual) – negligence in contracts resulting in BREACH. The debtor is liable for damages in view of his negligence in the fulfillment of a PRE- EXISTING OBLIGATION. **EXAMPLE:** A entered into a contract of sale na mag-deliver ng specific horse kay B on a certain day, tapos namatay yung horse through the negligence ni A. A (obligor) is liable for the damages to B for having failed to fulfill a pre-existing obligation. - Civil Negligence (culpa aquiliana) – negligence by itself is the source of an obligation between the parties not so related before any pre-existing obligation. **EXAMPLE:** (Same example kanina) Yung negligence ni A na nag-caused ng pagkamatay ng horse is called CULPA AQUILIANA. In this case, walang pre-existing contractual relation between A and B. The negligence itself is the source of liability. - Criminal Negligence (culpa criminal) – negligence resulting in the commission of crime. #### **ARTICLE 1173** Kapag nagkaroon ng negligence sa part ng debtor, liable siya for damages and nakaakibat sa circumstances of the person, the time and the place. Kapag yung negligence is acted in good faith, liable pa rin pero hindi gano'n kalaki, pero kapag bad faith liable doon sa pera na dapat kikitain ng obligee, tapos liable pa sa mga expenses niya sa hospital. #### **FACTORS TO BE CONSIDERED** - Nature of the obligation **EXAMPLE:** Flammable yung ide-deliver mo pero naninigarilyo ka pa rin. - Circumstances of the person **EXAMPLE:** Guard na healthy tapos nasa right age lang, natutulog on his time of duty is guilty of negligence. - Circumstances of the time **EXAMPLE:** Gabing-gabi pero nakaoff yung headlight ng sasakyan mo. - Circumstances of the place **EXAMPLE:** Okay lang na mag-drive ng 100 km sa highway pero it is irresponsible to do it in the city. #### **MEASURE OF LIABILITY FOR DAMAGES** Damages means yung money na ico-compensate mo for the failure of complying with the obligation. Awarding damages is naka-based kung good or bad faith yung negligence. **EXAMPLE:** Si A magdedeliver ng sugar worth 30k kay B. Tapos si B ibebenta niya yon kay C for 35k, and alam naman yon ni A. Pero si A hindi dineliver kaya napilitan si C na bumili sa iba. Dahil don nawalan ng 5k profit si B na ikinagalit niya and nagresult 'yon ng heart attack sakanya. So na- hospital si B for a week. If good faith yung ginawa ni A, 5k lang yung babayaran niya. Pero kung bad faith, kailangan niyang bayaran yung 5k plus kasama pa yung hospital expenses ni B. #### **KINDS OF DILIGENCE REQUIRED** - Napagkasunduan ng both parties via oral or writing - Required by law - Kapag hindi napagkasunduan or hindi required by law, dapat yung diligence is expected of a good father of a family. #### **ARTICLE 1174:** A fortuitous event is any extra-ordinary event which cannot be foreseen, though foreseen but it is inevitable. In general rule, if there is fortuitous event, the obligor is not liable and obligation will be extinguished. It will exempt the obligor from the fulfillment of his obligation when there is fortuitous event. #### **DISTINCTION OF FORTUITOUS EVENT AND FORCE MAJEURE** **FORTUITOUS EVENT** - **ACTS OF MAN**- independent upon the will of the obligor but not of other human wills. **EXAMPLE:** War, Fire, Murder **FORCE MAJEURE** - **ACTS OF GOD**- Events which are totally independent will of every human being. **EXAMPLE:** Earthquake, Typhoon, Rain #### **KINDS OF FORTUITOUS EVENT** - Ordinary fortuitous event- events which are common and which the contracting parties could reasonably foresee. (RAIN) - Extra-Ordinary event- events which are uncommon and which the contracting parties could not have reasonably foresee. (EARTHQUAKE, FIRE, WAR) #### **REQUISITES OF A FORTUITOUS EVENT** 1. The event must be independent of the human will or at least of the debtor's will. It has nothing to do with the obligor or any human being. 2. Event could not be foreseen, or if foreseen, is unavoidable. 3. The event must be such a character as to render it impossible for the obligor to comply with his obligations in normal manner 4. The debtor must be free from any participation in, or the aggravation of, the injury to the obligee. The absence of any of the above requisites would prevent the obligor from being exempt from liability. #### **ARTICLE 1175:** Usurious transactions shall be governed by special laws. (USURY ALW) **USURY**- It is the interest at unreasonably high rates being imposed from the loan or any use of money. Pagpapatubo ng sobrang taas. #### **REQUISITES FOR RECOVERY OF INTEREST** In order that interest may be recovered, (1) the payment of interest must be expressly stipulated, (2) it must be in writing; and (3) it must be lawful which means it is not unconscionable or iniquitous. #### **ARTICLE 1176:** This provision talks about PRESUMPTION **PRESUMPTION**- inference of a fact not actually known arising from its usual connection with another which is known or proved. (PAGPAPALAGAY) - 1st PARAGRAPH- Kapag daw yung creditor tinanggap yung bayad for the principal without any questions or complaints kung nasaan yung payment for the interest, mape-presumed na bayad na yung interest. - 2nd PARAGRAPH- If yung creditor is na-issue siya ng resibo ng utang without any complaints as to prior installments, mape-presumed din na bayad na 'yon. But take note na PRESUMPTION lang 'yon. Ibig sabihin it can be contradicted with sufficient evidences na magpapatunay na hindi pa talaga bayad. #### **2 KINDS OF PRESUMPTION** - Conclusive Presumption- cannot be contradicted. - Disputable Presumption- rebuttable siya, ibig sabihin it can be contradicted by proving evidences or proof. #### **ARTICLE 1177:** Remedies available to creditors for the satisfaction of their claims **EXAMPLE:** Si A may utang kay B na 500k. If si A hindi siya makapag-comply sa obligation niya na magabyad kay B tapos si A ay meron car worth 300k and si D (third person) ay may utang sakanya na 50k pesos,before yung due date ng obligation niya, binenta ni A (debtor) yung land niya worth 100k pesos. In case na yung debtor ay mag-fail na gawin yung obligation niya, si creditor may avail himself of the following remedies. Under the circumstances, yung rights ay granted kay B (creditor) - Exact fulfillment with the right of damages. (He may bring an action for the collection of 500kpesos with a right to damages. - Pursue the leviable property of the debtor (Since nag-fail nga na magawa ni A yung obligation niya na magbayad kay B, si B (creditor) pwede niyang kuhanin yung car ni A tapos ibenta and yung mapagbebentahan no'n ay mapupunta sakanya. - After having pursued the property ni debtor, si Creditor can bring all the actions of the debtor (like the right to collect money doon sa may utang kay debtor0 except those inherent or personal rights na meron siya like (right to vote, to receive legal support, etc...) (Pwede niyang i-ask sa court na huwga bayaran ni D (third person) yung utang niya kay A kasi nga hindi pa nakakabayad si A sakanya. - ask the court to rescind or cancel acts or contracts whuch the debtor may have done to defraud him. #### **ARTICLE 1178:** All rights acquired in virtue of an obligation are transmittable. (IBIG SABIHIN NATA-TRANSFER) But considering the general rule, there are exceptions. - If the contract is prohibited by law, then there is no transmutability of rights. - By the contract of partnership- syempre halimbawa sa isang business, partnerhip kayo, tapos kunwari namatay yung isa sa mga tao doon, hindi niya pwedeng i-transfer yung rights niya sa business na 'yon sa kahit na kkanino (kahit anak niya pa) kasi nga partnership 'yon. Kahit na namatay siya, still meron pa ring tao na magma-manage nung business. - By the contract of agency - By the contract of commodatum - Prohibited by stipulation of the parties, because stipulation or the contract is the law between the parties. #### **ARTICLE 1179:** Pure Obligation is one which the performance doesn't have conditions and terms or periods. There is no specific date for fulfillment, therefore, it is immediately demandable. **Conditional obligation** – Effectivity is subject to the fulfillment of a condition. A condition is a future, unforeseeable or uncertain event that will cause certain rights under a contract to be destroyed, created, or expanded upon. #### **2 PRINCIPA KINDS OF CONDITION** - Suspensive Condition is a condition which suspends rights and obligations or the validity of the entire contract until a certain future event occurs. Which means, no fulfillment, no obligation. If the Suspensive condition's fulfilled, the obligation arises. **EXAMPLE:** Bibigyan kita ng 10k if makapasa ka ng exam. Hangga't hindi mo nagagawa yung condition ko sa'yo, (to pass the exam) wala akong obligation na bigyan ka ng 10k. - Resolutory Condition- once mangyari na ang condition, mawawala na ang obliation. If it is the Resolutory condition that fulfilled, the obligation will be extinguishes. **EXAMPLE:** Bibigyan kita ng monthly allowance na 5k hanggang sa maka-graduate ka ng College. Yung obligation ko sa'yo sa pagbibigay ng 5k every month is demandable ngayon, pero once na maka-graduate ka na, ibig sabihin wala na akong obligation sa'yo. #### **ARTICLE 1180:** When the debtor binds himself to pay when his means permit him to do so, the obligation is not conditional but with a period. A period is a future and certain event upon the arrival which the obligation subject to it either arises or is extinguished. - The debtor promises to pay when his means permit him to do so. - As when the debtor binds himself to pay: - "little by little” (b) “as soon as possible” (c) “from time to time" If yung both parties ay hindi nagaksundo as to the specific time for payment, yung court