Oblicon Notes PDF

**TITLE I -- OBLIGATIONS** **Chapter 1. General Provisions** **Article 1156. An obligation is a juridical necessity to give, to do, or not to do.** Juridical necessity -- juridical tie; connotes that in case of noncompliance, there will be legal sanctions. - An obligation is nothing more than the duty of a person (obligor) to satisfy a specific demandable claim of another person (obligee) which, if breached, is enforceable in court. - A contract necessarily gives rise to an obligation, but an obligation does not always need to have a contract. - In a proper case, the debtor or obligor may also be made liable for **DAMAGES** -- sum of money given as a compensation for the injury or harm suffered by the obligee for the violation of his right. **KINDS OF OBLIGATION** **A. From the viewpoint of "sanction"** **(a) CIVIL OBLIGATION --** that defined in Article 1156; an obligation, if not fulfilled when it becomes due and demandable, may be enforced in court through action; based on law; the sanction is judicial due process **(b) NATURAL OBLIGATION --** a special kind of obligation which cannot be enforced in court but which authorizes the retention of the [voluntary payment or performance] made by the debtor; based on equity and natural law. (When the obligation has prescribed (meaning the legal time limit for enforcing the obligation has expired), the obligor is no longer legally required to pay. However, if the obligor voluntarily makes the payment despite prescription, they generally cannot recover that payment.) the sanction is the law, but *only conscience had originally motivated the payment.* **(c) MORAL OBLIGATION** -- the sanction is conscience or morality, or the law of the church. (Note: If a Catholic promises to hear mass for 10 consecutive Sundays in order to receive P1,000, this obligation becomes a civil one.) **B. From the viewpoint of subject matter** \(a) **REAL OBLIGATION** -- the obligation to give \(b) **PERSONAL OBLIGATION** -- the obligation to do or not to do (e.g. the duty to paint a house, or to refrain from committing a nuisance) **C. From the affirmativeness and negativeness of the obligation** \(a) **POSITIVE OR AFFIRMATIVE OBLIGATION** -- the obligation **to give or to do** \(c) **NEGATIVE OBLIGATION** -- the obligation not to do (which naturally includes **not to give**) **D. From the viewpoint of persons obliged -"sanction**" -- \(a) **UNILATERAL** -- where [only one] of the parties is bound (e.g. Plato owes Socrates P1,000. Plato must pay Socrates.) \(d) **BILATERAL** -- where [both parties] are bound (e.g. In a contract of sale, the buyer is obliged to deliver)- may be: - (b.1) reciprocal - (b.2) non-reciprocal -- where performance by one is non-dependent upon performance by the other **Essential Requisites of an obligation.** 1. **Active Subject** -- (Creditor / Obligee) the person who is demanding the performance of the obligation; 2. **Passive Subject** -- (Debtor / Obligor) the one bound to perform the prestation or to fulfill the obligation or duty; 3. **Prestation or Object** -- (to give, to do, or not to do) object; subject matter of the obligation; conduct required to be observed by the debtor; d 4. **Juridical tie or Legal tie** (vinculum juris) -- which binds the parties to the obligation; source of the obligation. **Article 1157. Obligation arises from --** **(1) law;** **(2) contracts;** **(3) quasi-contracts;** **(4) acts or omissions punished by law;** **(5) quasi-delicts.** \(1) **LAW** (Obligation ex lege) -- imposed by law itself; must be expressly or impliedly set forth and cannot be presumed - \[See Article 1158\] Ex: Obligation to pay taxes; Obligation to support one's family \(2) **CONTRACTS** (Obligation ex contractu) -- arise from stipulations of the parties: meeting of the minds / formal agreement - must be complied with in good faith because it is the "law" between parties; neither party may unilaterally evade his obligation in the contract, unless: a. contract authorizes it b. other party assents (agree) Note*: Parties may freely enter into any stipulations, provided they are not contrary to law, morals, good customs, public order or public policy*- \[See Article 1159\] \(3) **QUASI-CONTRACTS** (Obligation ex quasi-contractu) -- arise from lawful, voluntary and unilateral acts and which are enforceable to the end that *no one shall be unjustly enriched or benefited at the expense of another* 2 kinds: a. **Negotiorum gestio** - unauthorized management; This takes place when a person voluntarily takes charge of another's abandoned business or property without the owner's authority b. **Solutio indebiti** - undue payment; This takes place when something is received when there is no right to demand it, and it was unduly delivered \(4) **DELICTS** or **Acts or omissions punished by law** (Obligation ex maleficio or ex delicto) -- arise from civil liability which is the *consequence of a criminal offense* -- Ex: thief Governing rules: 1\. Pertinent provisions of the RPC and other penal laws subject to Art 2177 Civil Code \[Art 100, RPC -- Every person criminally liable for a felony is also civilly liable\] 2\. Chapter 2, Preliminary title, on Human Relations ( Civil Code ) 3. Title 18 of Book IV of the Civil Code -- on damages- \[See Article 1161\] \(5) **QUASI-DELICTS / TORTS** (Obligation ex quasi-delicto or ex quasi-maleficio) -- arise from damage caused to another through an act or omission, there being [no fault or negligence], but no contractual relation exists between the parties. \[See Article 1162\] **Article 1158. Obligations from law are not presumed. Only those expressly determined in this code or in special laws are demandable, and shall be regulated by the precepts of the law which establishes them; and as to what has not been foreseen, by the provisions of this Book.** - Unless such obligations are EXPRESSLY provided by law, they are not demandable and enforceable, and cannot be presumed to exist. - The Civil Code can be applicable suppletory to obligations arising from laws other than the Civil Code itself. - **Special laws** -- refer to all other laws not contained in the Civil Code. **Article 1159. Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith.** CONTRACT -- *meeting of minds* between two persons whereby one binds himself, with respect to the other, to give, to do something or to render some service; governed primarily by the agreement of the contracting parties. VALID CONTRACT -- it should not be against the law, contrary to morals, good customs, public order, and public policy. - In the eyes of the law, a void contract does not exist and no obligation will arise from it. OBLIGATIONS ARISING FROM CONTRACTS -- primarily governed by the stipulations, clauses, terms and conditions of their agreements. - If a contract's prestation is unconscionable (unfair) or unreasonable, even if it does not violate morals, law, etc., it may not be enforced totally. - Interpretation of contract involves a question of law. 1. **NEGOTIORUM GESTIO** -- juridical relation which takes place when somebody *voluntarily manages the property affairs of another* without the knowledge or consent of the latter; owner shall reimburse the gestor for necessary and useful expenses incurred by the latter for the performance of his function as gestor. 2. **SOLUTIO INDEBITI** -- something is received when there is no right to demand it and it was unduly delivered through mistake; obligation to return the thing arises on the part of the recipient. (e.g. If I let a storekeeper change my P500 bill and by error he gives me P560, I have the duty to return the extra P60). **Article 1161. Civil obligations arising from criminal offenses shall be governed by the penal laws, subject to the provisions of Article 2177, and of the pertinent provisions of Chapter 2, Preliminary in Human Relations, and of Title 18 of this book, regulating damages** **Scope of Civil liability:** **(a) RESTITUTION --** restoration of property previously taken away; the thing itself shall be restored, even though it be found in the possession of a third person who has acquired it by lawful means, saving to the latter his action against the proper person who may be liable to him. **(b) REPARATION OF THE DAMAGE CAUSED --** court determines the amount of damage: price of a thing, sentimental value, etc. **(c) INDEMNIFICATION FOR CONSEQUENTIAL DAMAGES --** includes damages suffered by the family of the injured party or by a third person by reason of the crime. **Article 1162.** **Obligations derived from quasi-delicts shall be governed by the provisions of chapter 2, title 17 of this book, and by special laws.** **QUASI-DELICT (culpa aquiliana)** -- an act or omission by a person which causes damage to another giving rise to an obligation to pay for the damage done, there being fault or negligence but there is no pre-existing contractual relation between parties. Requisites of Quasi-Delicts a. There must be an act or omission b. negligence c. damage cause to the plaintiff d. direct relation of omission, being the cause, and the damage, being the effect e. no pre-existing contractual relations between parties **Fault or Negligence** -- consists in the omission of that diligence which is required by the nature of the obligation and corresponds with the circumstances of the person, time, and of the place. A table with text on it Description automatically generated **CHAPTER 2 - NATURE AND EFFECT OF OBLIGATIONS** **Article 1163. Every person obliged to give something is also obliged to take care of it with the proper diligence of a good father of a family, unless the law or the stipulation of the parties requires another standard of care. (1094a)** Speaks of an obligation to care of a Specific or Determinate thing (that is one which is specific; a thing identified by its individuality) which an obligor is supposed to deliver to another. Reason: the obligor cannot take care of the whole class/genus **Specific or determinate** -- particularly designated or physically segregated from others of the same class. **Generic or indeterminate** -- refers only to a class or *genus* to which it pertains and cannot be pointed out with. **DUTIES OF DEBTOR** **IN OBLIGATION TO GIVE A DETERMINATE THING** I. Preserve or take care of the things due. - **DILIGENCE OF A GOOD FATHER** -- a good father does not abandon his family, he is always ready to provide and protect his family; *ordinary care* which an average and reasonably prudent man would do. - **ANOTHER STANDARD OF CARE** -- extraordinary diligence provided in the stipulation of parties. - **FACTORS TO BE CONSIDERED** -- diligence depends on the nature of obligation and corresponds with the circumstances of the person, time, and place. \*\* Debtor is not liable if his failure to deliver the thing is due to *fortuitous events or force majeure*... without negligence or fault in his part. II. Deliver the fruits of a thing III. Deliver the accessions/accessories IV. Deliver the thing itself V. 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. However, he shall acquire no real right over it until the same has been delivered to him** **FRUITS:** 1**. NATURAL** -- spontaneous products of the soil, the young and other products of animals. (e.g. grass; all trees and plants on lands produced w/o the intervention of human labor) 2.**INDUSTRIAL** -- produced by lands of any cultivation or labor. (e.g. sugarcane, vegetables, rice) 3.**CIVIL** -- those derived by virtue of juridical relation. (e.g. rents of buildings, price of leases of lands) **Article 1165**. When what is to be delivered is a determinate thing, the creditor, in addition to the irght granted him by Article 1170, may compel the debtor to make the delivery. If the thing may is indeterminate or generic, he ask that the obligation be complied with at the expense of the debtor. If the obligor delays or has promised to deliver the same ting to two or more persons who do not have the same interest, he shall be responsible for any fortuitous event until he has effected the delivery. 1169\. Those obliged to deliver or to do something incur in delay from the time the obligee judicially or extrajudicially demands from them the fulfillment of their obligation. However, the demand by the creditor shall not be necessary in order that delay may exists: 1. When the law or obligation so expressly declares; 2. When from the nature of the contract, time us the essence and motivating factor (controlling motive) for its establishment; 3. When demand would be useless (prestation is impossible); In reciprocal obligations, from the moment one of the parties fulfills his obligation; When the debtor admits he is in default. **When Demand Is Not Required for Delay** There are specific cases where the debtor is in delay without the creditor having to make a demand: 1. **When Law or Obligation Declares It**: If the law or the terms of the obligation say that the debtor will be in delay at a specific time, no demand is needed. 2. **When Time Is Essential in the Contract**: If the contract's nature shows that time is crucial (e.g., delivering a wedding cake on the wedding day), delay starts as soon as the deadline is missed because the timing is the key factor in the agreement. 3. **When Demand Would Be Useless**: If the performance of the obligation is clearly impossible (e.g., the debtor must deliver a specific item that has been destroyed), demanding performance is pointless, and delay automatically occurs. 4. **In Reciprocal Obligations**: In obligations where each party must perform a duty in exchange for the other (like a sale where one delivers a product, and the other pays), delay starts for one party as soon as the other party fulfills their part. For example, if the seller delivers goods but the buyer does not pay, the buyer is in delay. 5. **When the Debtor Admits Default**: If the debtor acknowledges that they are in delay (default), then a formal demand is not needed to establish it. DELAY 1. **Ordinary Delay** -- merely failure to perform an obligation on time. 2. **Legal Delay (Default or Mora**) -- failure to perform on time and breach of obligation. **Kinds of Delay or Default**: 1. **Mora Solvendi** - delay on the part of the *debtor* to fulfill his obligation (to give/ to do). 2. **Mora Accipiendi** - delay on the part of the *creditor* to accept the performance of the obligation; and 3. **Compensatio morae** -- the delay of the obligors in reciprocal obligations (sale). a. delay of both parties in reciprocal obligations (where each party has a duty dependent on the other's performance) b. In a sale, if the buyer delays payment and the seller delays delivery, *compensatio morae* exists until one side performs. **Default / Delay in negative obligation is not possible.** (In negative obligation, only fulfillment and violation are possible) **Article 1170. Those who in the performance of their obligations are guilty of fraud, negligence, or delay, and those who in any manner contravene the tenor thereof, are liable for damages.** - **Here the breach is voluntary.** Four grounds of liability: 1. **FRAUD (deceit/ dolo)** -- deliberate intentional evasion of the faithful fulfillment of an obligation. a. **Incidental Fraud** (Dolo Incidente) -- contract is existing nung ginawa b. **Causal Fraud** (Dolo causante) -- before the existence of contract 2. **NEGLIGENCE (culpa or fault)** -- voluntary act or omission of diligence, there being [no malice], which prevents the normal fulfillment of an obligation. 3. **DELAY (mora)** -- default or tardiness in the performance of an obligation after it has been due and demandable. 4. **CONTRAVENTION OF TERMS OF OBLIGATION (violation**)-- violation of terms and conditions stipulated in the obligation; this must not be due to a fortuitous event. **1171. Responsibility arising from fraud is demandable in all obligations. Any waiver of an action for future fraud is void**. - To allow such waiver will necessarily render the obligatory force of contracts illusory. The rule also says that waivers of future fraud are void. This means that no one can give up their right to hold another party accountable for fraud that hasn't happened yet. - The law does not prohibit waiver of an action for damages based on fraud already committed. - Any deliberate deviation from the normal way of fulfilling the obligation may be a proper basis for claiming for damages against the guilty party. **INCIDENTAL FRAUD** -- committed in the performance of an obligation already existing because of a contract. **CAUSAL FRAUD** -- employed in the execution of contract in order to secure consent; remedy is annulment bec of vitiation of consent. **1172. Responsibility arising from negligence in the performance of every kind of obligation is also demandable, but such liability may be regulated by the courts, according to circumstances**. Court's discretion because: \(a) negligence depends upon the circumstances of a case -- good or bad faith of the obligor may be considered as well as the conduct or misconduct of the obligee; \(b) it is not as serious as fraud. Negligence -- lack of foresight or knowledge Imprudence -- lack of skill or precaution TEST OF NEGLIGENCE: Did the defendant, in doing the alleged negligent act, use the reasonable care and caution which an ordinary prudent man would have used in the same situation? **Kinds of negligence according to source of obligation.** 1. **Contractual negligence (culpa contractual)** \- Negligence in the performance of contractual obligation \- Incidental to the performance of the obligation. \- Not complete and proper defense in the selection of employees. \- There is presumption -- defendant must prove that there was no negligence in the carrying out of the terms of the contract. 2. **Civil negligence (culpa aquiliana)** \- Negligence between parties not so related by pre-existing contract; \- Direct, substantive and independent; \- Complete and proper defense (parents, guardian, employers) \- No presumption -- injured party must prove negligence of the defendant. 3. **Criminal negligence (culpa criminal)** - Crime committed because of negligence **1173. The fault or negligence of the obligor consists in the omission of that diligence which is required by the nature of the obligation and corresponds with the** **circumstances of the persons, of he time and of the place. When negligence shows bad faith, the provisions of Articles 1171 and 2201, paragraph 2, shall apply.** **If the law or contract does not state the diligence which is to be observed in the performance, that which is expected if a good father of a family shall be required.** ![A table with black text Description automatically generated](media/image2.png) DILIGENCE -- the attention and care required of a person in a given situation and is opposite of negligence. NEGLIGENCE -- consists in the omission of that diligence which is required by the nature of the particular obligation and corresponds with the circumstances of the persons, of the time, and of the place. DAMAGE -- money compensation **KINDS of DILIGENCE**: 1. DILIGENCE OF A GOOD FATHER -- a good father does not abandon his family, he is always ready to provide and protect his family; ordinary care which an average and reasonably prudent man would do. 2. Diligence required by the law governing the particular obligation 3. Diligence stipulated by the parties **1174. Except in cases when it is otherwise expressly specified by the law, or declared by stipulation, or when the nature of the obligation requires the assumption of risk, no person shall be responsible for those events which could not be foreseen, or which, though foreseen, were inevitable**. **FORTUITOUS EVENT (FORCE MAJEURE)** -- an occurrence or happening which [could not be foreseen] or even if foreseen, is [inevitable]; absolutely independent of human intervention; act of God. - **Acts of Man** - an event caused by the legitimate or illegitimate acts of persons other than the obligor; there is human intervention. (war, fire, robbery,murder) - **Acts of God (majeure)** -- totally independent from the will of a human being. (earthquake, flood, rain, lightning) **Kinds of fortuitous events:** 1. **Ordinary fortuitous event** -- common and parties could reasonably foresee(rain) 2. **Extra-ordinary fortuitous event** -- uncommon and the parties could not reasonably foreseen (war, earthquake) **Conditions which exempt obligor from liability (Requisites of fortuitous event):** 1\. event is independent of the human will or obligor's will 2\. it must either be [unforeseeable] or [unavoidable]; inevitable 3\. [occurrence must render it impossible] for the debtor to fulfill the obligation in [a normal matter ] 4\. the obligor is [free of participation] in injury to creditor. **1175. Usurious transactions shall be governed by special laws.** **SIMPLE LOAN/mutuum** -- one of the parties delivers to another, money or other consumable thing upon the condition that the same amount of the same kind and quality shall be paid **USURY** -- contracting for or receiving interest in excess of the amount allowed by law for the loan or use of money, goods, etc. **USURY LAW** -- makes the usurers criminally liable if the interest charged on loans are more that the limit prescribed by law. This law is repealed -- Circular No. 905 of the Central Bank has expressly removed the interest ceilings prescribed by the USURY LAW. Usury is now legally non-existent. **Article 1176. The receipt of the principal by the creditor, without reservation with respect to the interest, shall give rise to the presumption that said interest has been paid.** **The receipt of a later installment of a debt without reservation as to prior installments, shall likewise raise the presumption that such installments have been paid** **Presumption --** inference of a fact not actually known arising from its usual connection with another which is known or proved.; assumption that the law accepts as true w/o direct proof Two kinds of presumption: 1. **Conclusive presumption** -- cannot be contradicted; everyone is presumed to know the law 2. **Disputable (or rebuttable) presumption** -- can be contradicted by presenting proof - "**Principal**" - the amount initially borrowed - "**Interest**"- an additional sum representing the cost of borrowing the money or delaying payment - **Presumption of Payment of Interest**: If the creditor accepts the full amount of the **principal** without any objections or reservations, the law presumes that any **interest** owed has also been paid, even if there\'s no explicit evidence that it was - **What if the creditor disagrees later?** The presumption that the interest has been paid [isn't absolute]; it's **rebuttable.** This means that if the creditor has evidence that the interest wasn't paid---perhaps some written communication, receipts, or an agreement stating otherwise---they can challenge this presumption in court. However, without any reservations or objections from the creditor at the time of payment, the law takes the position that the debt has been fully settled. - The 2nd paragraph extends the idea of presumptions to installment payments. It says that *if the creditor accepts a later installment of a debt without raising any objections about previous unpaid installments, the law presumes that the earlier installments have already been paid*. **Article 1177**. **The creditors, after having pursued the property in possession of the debtor to satisfy their claims, may exercise all the rights and bring all the actions of the latter for the same purpose, save those which are inherent in his person; they may also impugn the acts which the debtor may have done to defraud them.** - Creditor\'s right to pursue the debtor\'s property **to satisfy their claims**. Essentially, creditors have the right to look for assets or properties that the debtor owns and use those to fulfill the debtor\'s unpaid obligations. (e.g. Foreclosing on property (e.g., land, cars, houses) owned by the debtor or Seizing assets such as bank accounts or personal property) - if the debtor has rights or claims against third parties, the creditor can exercise those rights to collect the money owed to the debtor, and ultimately use it to pay the debt - the law limits this by excluding rights that are "inherent in his person." This means that the creditor cannot exercise personal rights of the debtor that are intimately tied to the debtor themselves, such as: - Family rights (e.g., rights related to marriage, custody of children). - Employment rights (e.g., wages, personal contracts that are exclusive to the debtor). - gives creditors the right to challenge or **invalidate fraudulent acts done by the debtor** to escape their obligations. If the debtor tries to deceive creditors by hiding assets or transferring property to others (perhaps family or friends) to prevent the creditors from collecting, the **creditors can take legal action to nullify these fraudulent transfers.** **Article 1178. Subject to the laws, all rights acquired in virtue of an obligation are transmissible, if there has been no stipulation to the contrary.** - **Transmissible** means that these rights can be passed on or transferred to others. - **By** **assignmen**t: One person can transfer their right to collect a debt to another person (e.g., A sells their right to collect a debt from B to C). - **By inheritance**: When someone dies, their rights (such as the right to collect debts or receive benefits from contracts) can pass to their heirs. - **Stipulation** refers to an agreement between the parties. If the parties have agreed that the rights arising from an obligation cannot be transferred, then that agreement must be respected. **CHAPTER 3: DIFFERENT KINDS OF OBLIGATIONS** Section 1.-- Pure and Conditional Obligations **Article 1179.** Every obligation whose performance does not depend upon a future or uncertain event, or upon a past event unknown to the parties, is **demandable at once**. Every obligation which contain resolutory condition shall also be demandable, without prejudice to the effects of the happening of the event. (1113) - **Pure Obligations**-not contingent upon any condition or future uncertain event. In simpler terms, it can be demanded immediately because it is not dependent on anything happening or not happening in the future. - **Conditional obligation**-is an obligation whose performance depends on the occurrence or non-occurrence of a specific future event, which is **uncertain**. This means that the obligation will only become enforceable if a certain condition is met. - **Characteristics of Condition** - Future and uncertain event - Example: Kapag pumasa ka ng board exam sa 2024, bibigyan kita ng 10,000 pesos. - Past but unknown event - Example: if the existence of atlantis in the past, I will give you 10,000 pesos. - Yung mga conspiracies sa past - **2 Principals of Condition: Suspensive vs. Resolutory Condition** - **Suspensive Condition (Condition Precedent/Condition Antecedent)** -- if the conditions are met it will give rise to an obligation (or right). - **Resolutory Condition** -- if the conditions are met, it will extinguish the obligation (or right). **Article 1180.** When the debtor binds himself to pay when his means permit him to do so, the obligation shall be deemed to be one with a period, subject to the provisions of Article 1197. (n) - **Period** -- future and certain event upon the arrival f which the obligation subject to it either arises or is extinguished - **Where duration of period depends upon the will of the debtor**. 1. **The debtor promises to pay when his means permit him to do so**. - This article deals with obligations that are ***dependent on the financial capacity of the debtor to pay***. It clarifies that even though the exact time of payment is not specified, the obligation is not entirely discretionary for the debtor. Instead, it is classified as an obligation with a period. **Article 1181.** In conditional obligations, the acquisition of rights, as well as the extinguishment or loss of those already acquired, shall depend upon the happening of the event which constitutes the condition. - **conditional obligations**, which are obligations dependent on the occurrence or non-occurrence of a future or uncertain event. In these kinds of obligations, the acquisition or loss of rights is tied to whether the condition happens or not. **Article 1182**. When the fulfillment of the condition depends upon the **sole will of the debtor**, the conditional obligation shall be **void**. If it depends upon chance or upon the will of a third person, the obligation shall take effect in conformity with the provision of this code. - because it creates a situation where the debtor can unilaterally determine whether the obligation arises or not, leading to potential unfairness. - The second part of the article states that if the condition relies on chance (like, a random event) or the will of a third person, the obligation remains valid and shall take effect in accordance with the provisions of the law. Classification of conditions. 1. As to Effect: a. **Suspensive** b. **Resolutory** 2. As to form: c. **Express** -- directly stated d. **Implied** - The condition is not directly stated but can be inferred from the nature of the obligation or circumstances. Example: A contract to deliver goods \"as soon as possible\" implies the condition that delivery depends on reasonable factors like availability. 3. As to possibility: e. **Possible** f. **Impossible** -- conditions contrary to the law, good customs, or public policy **Article 1183.** Impossible conditions, those contrary to good customs or public policy and those prohibited by law shall annul the obligation which depends upon them. If the obligation is divisible, that part thereof which is not affected by the impossible or unlawful condition shall be valid. The condition not to do an impossible thing shall be considered as not having been agreed upon. (1116a) - legal agreements *should not be based on things that cannot happen* or go against public morals or legal rules. - Divisible condition, If the obligation can be divided into parts, and only part of it is based on an impossible or unlawful condition, then the rest of the obligation remains valid. *Only the part related to the impossible or illegal condition is void*. - **Article 1183** refers to suspensive conditions. Only to cases where the impossibility existed at the time the obligation was constituted. If the impossibility arises after the creation of the obligation, Article 1266 governs. **Article 1266** governs supervening impossibility---meaning the obligation was validly constituted at the beginning, but later became impossible to fulfill due to unforeseen events (i.e., fortuitous events or force majeure). - The conditional obligation is valid if the condition is negative (not to do something). Actually, the condition is always fulfilled when it is not to do an impossible thing so that it is the same as if there were no condition. 4. As to cause or origin: g. **Potestative** -- sole will of one of the parties. (Art. 1182--Debtor's will, void) h. **Casual**- fulfillment of the condition depends on chance or external factors i. **Mixed** - both the will of a party and external factors. Example: \"I will pay you if you pass the driving test.\" Passing the test depends partly on the person's efforts (the party\'s will) and partly on the test (external factor). 5. As to mode: j. **Positive** - requires that something happens; performance of an act. **Article 1184.** The condition that some events happen at a determinate time shall extinguish the obligation as soon as the time expires or if it has become indubitable that the event will not take place. It refer to positive suspensive condition. The obligation is extinguished: \(1) as soon as the time expired *without the event taking place* E.G. X will buy Y\'s land if he can obtain title within a year. If the year expire without the land being titled, then the obligation of X is extinguished. (**expiration**) \(2) as soon as it has become indubitable that the event will not take place *although the time specified has not expired*. E.G. X will buy Y\'s land if he can obtain title within a year. If the land cannot be titled since it is within public domain, then the obligation of X is extinguished. (indubitable event) A positive condition requires that the event contemplated shall happen. E.g., \'If I marry. \' A negative condition requires that the event contemplated shall not happen. E.g., \'If I do not marry. 6. As to numbers: k. **Conjunctive** -The obligation is subject to *multiple conditions* that **must all happen for the obligation to be fulfilled**. E.g. "I will pay you if you pass both the written and practical exams.\" Both conditions must be fulfilled. l. **Disjunctive** - The obligation is subject to *multiple conditions*, but it is ***enough for one of them to happen* for the obligation to be fulfilled**. Example: \"I will pay you if you pass either the written or practical exam.\" Only one of the conditions needs to be met. 7. As to divisibility: m. **Divisible** - An obligation is considered divisible when it *can be partially fulfilled*, meaning that performance ***can be divided into parts***. It does not necessarily need all parts to be completed for partial fulfillment. However, in a conditional divisible obligation, only one condition needs to be fulfilled if that is specified. Example: \" I will pay you half if you pass the written exam, and the other half if you pass the practical exam.\" n. **Indivisible**- An obligation is indivisible when *it requires full performance* in its entirety for it to be considered fulfilled; it *cannot be divided into parts*. Therefore, if an obligation has multiple conditions, the fulfillment of all conditions as specified is necessary to fulfill the obligation completely. Example: \" \"I will pay you if you pass both the written and practical exams.\" - **If the suspensive condition depends on the will of the debtor, the obligation is VOID.** There is no burden on the debtor and no juridical tie because the obligation is still not created. - If the suspensive condition depends **exclusively on the will of the creditor**, the **obligation is VALID**. Normally, the creditor is interested in the fulfillment of the condition because it will benefit them. - **If the resolutory condition depends upon the will of the debtor, the condition is valid**. Even though it's based on the debtor\'s will, the condition is valid because it *simply ends an existing obligation*, rather than controlling whether the obligation starts in the first place (which would make it void if suspensive). **Article 1186. The condition shall be deemed fulfilled when obligor voluntarily prevents its fulfillment.(1119)** - The law does not require the obligor acts with malice or fraud as long as his purpose I stop the fulfillment of the condition. He should not be allowed to profit from his own fault or bad faith to the prejudice of the obligee. **Article 1187.** The effects of a conditional obligation to give, once the condition has been fulfilled, shall retroact to the day of the constitution of the obligation. Nevertheless, when the obligation imposes reciprocal prestations upon the parties, the fruits and interests during the pendency of the condition shall be deemed to have been mutually compensated. If the obligation is unilateral, the debtor shall appropriate the fruits and interests received, unless from the nature and circumstances of the obligation it should be inferred that the intention of the person constituting the same was different. In obligations to do and not to do, the courts shall determine, in each case, the retroactive effect of the condition that has been complied with. (1120) - **Retroactive Effect**: When a condition is fulfilled, the effects of the obligation go back to when the obligation was first made. When a conditional obligation (an obligation that depends on the occurrence of an event) is fulfilled, its effects apply retroactively, meaning they are considered to have *started from the moment the obligation was initially created*, not from the moment the condition was met. - **Reciprocal Obligations**: Both sides owe each other something, and any benefits earned while waiting for the condition to be met are considered to cancel each other out. - **Unilateral Obligations**: Only one party owes something, and the party who owes can keep any benefits earned from the obligation, unless the agreement says otherwise. **Article 1188**. The creditor may, before the fulfillment of the condition, bring the appropriate actions for the preservation of his right. The debtor may recover what during the same time has paid by mistake in case of suspensive condition. (1121a) - **Rights of Creditor**. The creditor is the person who is entitled to receive the benefit of the obligation (e.g., money, property, etc.). Even before the condition is fulfilled, the creditor has the right to take certain actions to protect their interests. This means that *if there is a chance that the condition may not be fulfilled* (for example, if the debtor might not be able to provide what they promised), *the creditor can act to safeguard their rights*. This could involve: - **Preventing Deterioration**: Taking measures to prevent the loss or deterioration of the property that is subject to the obligation. - **Legal Action**: Filing for protective legal measures, such as seeking a preliminary injunction to prevent any actions that could jeopardize their rights. - **Rights of Debtor**. The debtor is the person who owes something under the obligation. If a debtor pays something by *mistake* while waiting for the condition to be fulfilled, they have the right to get that payment back. Suspensive condition---this refers to a situation where the obligation to pay or fulfill something is dependent on a future event that is uncertain (the condition). Until the condition occurs, the obligation is not yet enforceable. **Article 1189**. ***Effect of loss, deterioration, or improvement before arrival of period.*** When the conditions have been imposed with the intention of suspending the efficacy of an obligation to give, the following rules shall be observed in case of the improvement, loss or deterioration of the thing during the pendency of the condition: 1. If the thing is *lost without the fault of the debtor*, the obligation shall be *extinguished*. - A person, as a general rule, is not liable for a fortuitous event. If the debtor loses the thing due to circumstances beyond their control (like a natural disaster or accident --- called a fortuitous event), they are not at fault. Since they can\'t deliver the thing anymore, the obligation disappears. 2. If the thing is *lost through the fault of the debtor, he shall be obliged to pay damages*; it is understood that the thing is lost when it perishes, or goes out of commerce, or disappears in such a way that its existence is unknown or it cannot be recovered; - The debtor must pay damages. If the thing is lost because of the debtor\'s fault or negligence, the obligation is not simply canceled. The debtor must compensate the creditor for the loss. The thing is considered \"lost\" when it can't be found, is destroyed, or can no longer be part of commerce (i.e., can\'t be legally sold). - Example: You promised to give me your car if I pass my exams, but you crashed the car because you were driving recklessly. Now, since it\'s your fault the car is gone, you owe me damages. 3. When the thing deteriorates without the fault of the debtor, the impairment is to be *borne by the creditor*; - The impairment (damage) is to be borne by the creditor. f the thing becomes damaged or deteriorates without the debtor being at fault, the creditor (the person waiting for the thing) has to accept it as is. The debtor is not responsible for the damage. - Example: You promised to give me your car, but during the waiting period, the paint starts to fade because of natural wear and tear. You are not at fault, so I have to accept the car in its slightly damaged state. 4. If it *deteriorates through the fault of the debtor, the creditor may choose between the rescission of the obligation and its fulfillment*, with indemnity for damages in either case - The creditor can choose between two options: - - 5. If the thing is *improved by its nature, or by time, the improvement shall inure to the benefit of the creditor*; - **The improvement benefits the creditor**. If the thing becomes better over time or by natural causes, the creditor is the one who benefits from the improvement. The debtor can't ask for anything extra. - Example: You promised to give me your car, and during the waiting period, the ***car's value increases*** because it becomes a collector's item. I (creditor) get the car, and I also benefit from its increased value. 6. If it *is improved at the expense of the debtor, he shall have no other right than that granted to the usufructuary*. - A **usufructuary** is someone who can ***enjoy the use and fruits of the property but doesn't own it***. They are entitled to use the thing or enjoy the fruits of their improvements (like renting it out and collecting income from it) until the condition is fulfilled. - If the debtor makes improvements to the thing at their own expense, they don't get extra compensation or benefits. The creditor still gets the improved thing, but the debtor doesn't have more rights than a usufructuary, meaning they can't claim reimbursement for the improvements unless otherwise agreed. - Example: You promised to give me your car, but during the waiting period, you spend money upgrading the car's sound system. You can't ask me to pay you back for the upgrades unless we had agreed on that in advance. Kinds of loss (mentioned in 2). Loss in civil law may be: - **Physical loss** (when the thing has perished \[the house is burned) - **Legal loss** ( when the thing goes out of commerce like, marijuana naging bawal), - **Civil loss** (disappears in such a way that its existence is unknown or it cannot be recovered \[hindi nasira pero hindi na makukuha at wala na makinabang.\], \[nahulog sa dagat yung diamond ring\], \[lost dog\] **Article 1190**. When the conditions have for their purpose the extinguishment of an obligation to give, the parties, upon the fulfilment of said conditions, shall return to each other what they have received. In case of the loss, deterioration or improvement of the thing, the provisions which, with respect to the debtor, are laid down in the preceding article shall be applied to the party who is bound to return. As for obligations to do and not to do, the provisions of the second paragraph of Article 1187 shall be observed as regards the effect of the extinguishment of the obligation. - Article 1190 states that when the conditions that lead to the extinguishment of an obligation are fulfilled, both parties must return what they received from each other. This is a principle of reciprocity and fairness. - **Return of Benefits**. if one party received something (like money or property) because of an obligation, and that obligation is extinguished due to the fulfillment of the condition, **they must return what they received.** This is to ensure that neither party unjustly benefits from the situation. Example: If Party A was supposed to give Party B a car upon completion of a project, and the project was never completed (thus extinguishing the obligation), Party B must return the car to Party A if they had already received it. - Handling Loss, Deterioration, or Improvement (same provisions in the 1189) **Article 1191**. 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 fulfilment and the rescission of the obligation, with the payment of damages in either case. He may also seek rescission, even after he has chosen fulfilment, if the latter should become impossible. The court shall decree the rescission claimed, unless there be just cause authorizing the fixing of a period. This is understood to be without prejudice to the rights of third persons who have acquired the thing, in accordance with articles 1385 and 1388 and the Mortgage Law. (1124) - Reciprocal Obligations: These are obligations where each party is bound to perform something in relation to the other (e.g., A must deliver goods to B, and B must pay for those goods). This article recognizes that if one party fails to fulfill their part of the agreement, the other party has the right to rescind (cancel) the obligation. - In Case of Non-Compliance - **Injured Party\'s Rights:** If one party (the obligor) does not comply with their obligation, the other party (the injured party) has two options: **Fulfillment**: The injured party can choose to insist that the other party fulfill their obligation. **Rescission**: Alternatively, the injured party can choose to rescind the obligation, effectively canceling it. - **Payment of Damages**: In both cases (whether the injured party chooses fulfillment or rescission), they can also seek damages. This means that if the other party\'s failure to comply has caused harm or loss, the injured party can claim compensation. - **Rescission After Choosing Fulfillment** - The last part of the article notes that the rescission of an obligation does not affect the rights of third parties who may have acquired rights or interests in the property involved in the obligation, as specified in Articles 1385 and 1388. This protects the interests of individuals who may not be directly involved in the contractual relationship but have legitimate claims related to the property or obligation. **SECTION 2. -- OBLIGATIONS WITH A PERIOD** **Article 1193**. Obligations for whose fulfillment a day certain has been fixed, shall be demandable only when that day comes. Obligations with a resolutory period take effect at once but terminate upon arrival of the day certain. A day certain is understood to be that which must necessarily come, although it may not be known when. If the uncertainty consists in whether the day will come or not, the obligation is conditional and it shall be regulated by the rules of the preceding Section. - ***Period*** and ***term*** have the ***same meaning*** and are used interchangeably. It consists in a space or length of time upon the arrival of which, the demandability or extinguishment of an obligation is determined. - A **period** is a certain length of time which determines the effectivity or the extinguishment of obligations. - **A day certain** is understood to be that which must necessarily come, although it may not be known when. - **"On or about"** may be two or three days before or after the date mentioned but not so remote thereafter. - \(1) When an obligation **has a fixed date** (or a \"day certain\") for its fulfillment, *the creditor cannot demand its fulfillment before that date arrives*. The obligation only becomes enforceable when that specified day comes. - Example: If you owe someone money but are only required to pay on December 1, 2024, the creditor cannot demand payment before that date. The obligation to pay will only become due when the day arrives. - \(2) An obligation with a resolutory period is effective immediately, but it **will terminate upon the arrival of a specific future date**. - Example: \"I will let you use my apartment until the end of the year.\" The obligation (allowing someone to use the apartment) begins immediately, but it will end automatically when December 31 arrives. This period is resolutory because it \"resolves\" or terminates the obligation. - \(3) The term **\"day certain\"** refers to an event that is **guaranteed to happen**, although its exact timing may not be known. The important distinction here is that the day will surely come. - Example: The death of a person is a \"day certain\" because it is a future event that is bound to occur, even though no one knows exactly when it will happen. If an obligation is tied to this event (e.g., \"I will pay you upon the death of X\"), the obligation is considered to have a day certain. - If the occurrence of the event itself is **uncertain**, meaning it **might or might not happen**, then the obligation is conditional rather than one with a period. This means the obligation will follow the rules of conditional obligations found in the previous sections of the Civil Code. - Example: \"I will pay you if X wins the lottery.\" This is an example of a condition because it is uncertain whether the event (winning the lottery) will ever happen. **Kinds of period or term**: 1. According to effect: a. **Suspensive Period (ex die)** -- obligation begins from a day certain upon the arrival of period b. **Resolutory Period (in diem)** -- obligation is valid up to the day certain and terminates upon arrival of the period. 2. According to source: c. **Legal period** -- when -- when it is provided for by laws. Example: Payment of taxes is due by a specific date each year, as prescribed by law. d. **Conventional or voluntary period** -- when it is agreed to by the parties. Example: In a loan agreement, the borrower and lender may agree that payment is due in 6 months. e. **Judicial Period** -- when it is fixed by the court. Example: A judge may set a deadline for payment or delivery of goods when a contract is silent on when the obligation should be performed. 3. According to definiteness f. **Definite period** -- when it is fixed or it is known when it will come. Example: \"Payment will be made on December 31, 2024.\" This is a definite period because the exact date is clear and known. g. **Indefinite period** -- when it is not fixed or it is not known when it will come. Where the period is not fixed but a period is intended, the courts are usually empowered by law to fix the same. Example: \"Payment will be made when the debtor has sufficient funds.\" This is indefinite because it is not known when the debtor will have enough money. In such cases, the court may step in and fix the period based on fairness and reasonableness. **Article 1194**. In case of loss, deterioration or improvement of the thing before the arrival of the day certain, the rules in Article 1189 shall be observed. **Article 1195**. Anything paid or delivered before the arrival of the period, the obligor being unaware of the period or believing that the obligation has become due and demandable, may be recovered, with the fruits and interests. (1126a). - It's about when someone (the obligor) pays or gives something before they actually have to, ***by mistake*** or because they don't know when the payment is due. If you paid or gave something early ***without knowing that it wasn't due yet, you have the right to get it back***. You can also ask for any benefits or interest that the other person (the obligee) may have gained by holding your money or thing early. - If you knew that you didn't have to pay yet but still chose to pay, you can't get your money or item back. However, you can still ask for the interest or benefits that the other person earned from your early payment. - No recovery in personal obligations. This rule ***only applies to cases where you have to give something*** (like money or goods). It does not apply to things where you have to do something (like performing a service) or not do something (like staying away from certain actions). **Article 1196**. Whenever in an obligation a period is designated, it is presumed to have been established for the benefit of both the creditor and the debtor, unless from the tenor of the same or other circumstances it should appear that the period has been established in favor of one of the other. - how a period (or deadline) in an obligation is presumed to benefit both parties involved---the creditor (the person owed something) and the debtor (the one who owes). - Para kaninong benefit ba yung paglalagay ng period sa obligation? Both the credit and debtor benefits from period. **Computation of term or period**. 1. The Administrative Code of 1987, however, provides: **Legal Periods** - "**Year**" shall be understood to be twelve calendar months - "**Mont**h" of thirty days unless, a specific calendar month - "**day**" 24 hours - "**night**" sunset to sunrise 2. **Calendar month** -- month designated in the calendar without regard to number of days it may contain. **Article 1197**. 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. **Court May Fix Term** **Court may not fix a term** **Article 1198**. The debtor shall lose every right to make use of the period: When after the obligation has been contracted, he becomes insolvent, unless he gives a guaranty or security for the debt; When he does not furnish to the creditor the guaranties or securities which he has promised; When by his own acts he has impaired said guaranties or securities after their establishment, and when through a fortuitous event they disappear, unless he immediately gives new ones equally satisfactory; When the debtor violates any undertaking, in consideration of which the creditor agreed to the period; When the debtor attempts to abscond.(escape) (1129a) \(1) If after entering into the obligation, the debtor becomes insolvent (i.e., unable to pay their debts), they lose the right to use the period unless they can provide a guaranty or security for the debt. Example: Debtor owes creditor 10k due and payable on December 20. If debtor becomes insolvent 3 months before December 20. Under article 1198, par. 1 *the creditor can demand immediate payment from the debtor* even before the maturity, *unless the debtor gives sufficient guarantee or security (like a mortgage or another form of security )*. Halimbawa, i-promise yung kotse ng debtor para sa utang kung walang pambayad. *Insolvency need not be judicially declared for the creditor to avail of the remedy under this provision. It is sufficient that the asset of the debtor is less than his liabilities*. Take note: The insolvency of the debtor must occur after the obligation has been contracted. Huwag magpautang kung alam na insolvent na at di makakabayad. 3. When he does not furnish to the creditor the guaranties or securities which he has promised. Gumawa ng contract of obligation si debtor and creditor and napag usapan nila na si debtor is supposed to give or furnish the collateral, guarantee or security because of that debt or loan. Pero 'di naman nagfufurnish kay creditor, di nagbibigay. Pwede gamitin ni creditor yung remedy na to. *He can demand the payment of loan. And debtor shall lose the right to avail of the benefit of the suspensive period*. 4. when by his own acts he has **impaired said guaranties or securities** after their establishment, and when through **a fortuitous event** they disappear, unless he immediately gives new ones equally satisfactory kunwari nawala or naimpaired yung guarantee or security. In that case, di na secured yung loan.kunwari may utang si creditor kay debtor, tapos ginamit nyang security sa loan yung bahay niya. Pero nasunog yung bahay dahil sa negligence ni debtor. Pwede gamitin ni creditor ang remedy unless mapalitan ni debtor yung securities niya for loan. If from *fortuitous event, it must require that the security must totally disappear*. *But if the security only deteriorates because of fortuitous event, and it becomes illusory because of deterioration then it must be deemed to have disappeared or lost as contemplated in par 3 of art 1198 of the new civil code.* If the debt is secured by a bond, the failure of the debtor to renew the bond or replace it with an equivalent guarantee upon its active expiration will likewise give *the creditor see the right to demand immediate payment for it*. 5. When the debtor **violates any undertaking**, in consideration of which the creditor agreed to the period; The creditor agreed to the period in consideration of the promise of the debtor to repair the piano of the creditor free of charge. So the violation of this undertaking by debtor gives the creditor the right to demand immediate payment of the loan. 6. When the debtor *attempts to abscond*. Before the due date of the obligation, the debtor changed his address without informing the creditor and with the intention of escaping from his obligation. This act of the debtor is a sign of bad faith which results to the loss of his rights to the benefit of the period stipulated. Also note that mere attempt or intent to abscond is sufficient. - General rule: before the arrival of the suspensive period, 'di pwedeng i-demand yan. But in this article, there are cases where an obligation can be demanded even prior to the lapse of the period agreed upon - Kapag nagawa any of these, the period is disregarded and the obligation becomes pure and is immediately demandable **SECTION 3. -- ALTERNATIVE OBLIGATIONS** **Article 1199**. A person alternatively bound by different prestations shall completely perform one of them. The creditor cannot be compelled to receive part of one and part of the other undertaking. (1131) - It means that the debtor is bound to perform one of several possible obligations (prestation options), but not all of them **Kinds of obligations according to object.** **Simple Obligation** -- is one where there is only **one prestation**. E.g. seller obliged himself to deliver piano to the buyer. Isa lang prestation which is to deliver the piano. **Compound Obligation** -- is one where there are **two or more prestations**. - **Conjunctive obligation** - one where there are several prestations and all of them are due. - **Distributive obligation** - one where two or more prestations are due. it is either alternative (art. 1199) or facultative (art. 1206) - **Alternative obligation** - one where several prestations are due but performance of one of them is sufficiently determined by the choice which, as a general rule, belongs to the debtor. Ex: I borrowed 10k to Aira. It was agreed that I comply with my obligations either by giving Aira 10k or instead of paying 10k, give her a colored television set, or paint her house. In this case, ***the debtor has the option*** to choose kung alin ang i-de-deliver kay creditor. Performance of the prestation chosen must be complete - **Facultative obligation** -- one where only one prestation is due but the debtor may substitute another (Art. 1206) \[ ill. Gigi, upon failure to pay her debt to Carlo in 30 days, will mortgage her land to secure her debt which shall be payable in 90 days \] **Article 1200**. The **right of choice belongs to the debtor**, unless it has been expressly granted to the creditor. The debtor shall have no right to choose those prestations which are impossible, unlawful or which could not have been the object of the obligation. - By default, the person who owes the obligation (the debtor) has the right to decide which prestation to perform. The right to choose may belong to the creditor (the person to whom the obligation is owed), but this must be clearly stated in the agreement or contract. - The debtor cannot choose prestations that are: - Impossible (e.g., delivering something that no longer exists) - Unlawful (e.g., giving something illegal or forbidden) - Not the object of the obligation (e.g., offering something that was never part of the agreed options) **Article 1201.** The choice shall produce no effect except from the time it has been communicated. (1133) - Article 1201 makes it clear that the choice does not take effect until it has been communicated to the other party. This means that even if the debtor has already made up their mind privately, nothing changes in the obligation until they formally notify the creditor of their decision. For example, if the debtor chooses to deliver the motorcycle (instead of the car), the *choice is not binding until they tell the creditor about it*. **Article 1202**. The debtor shall lose the right of choice when among the prestations whereby he is alternatively bound, only one is practicable. - It becomes a simple obligation and immediately demandable. **Article 1203**. If through the creditor\'s acts the debtor cannot make a choice according to the terms of the obligation, the latter may rescind the contract with damages. **RESCISSION** -- It creates the obligation *to return the things* which were the object of the contract together with their fruits and their price with its interest. The right given the debtor to rescind the contract and recover damages is through the creditor's fault, he cannot make a choice according to the terms of the obligation. - Di sinasabing the debtor shall rescind; the debtor has only given choice to rescind with damages. Under art. 1170 - If kunwari nag deliver ako ng item 1 and it is destroyed through the fault of creditor. Debtor can rescind the contract kung gusto niya. In case of rescission, the amount of 20k must be returned by debtor with interest. And the creditor who is at fault must pay the debtor the value of item 1 plus damages. Instead of rescinding the contract, i may also choose item 2 or 3 with a right to recover the value of item 1 with damages. If i chosen the item 1, the obligation is extinguished. The creditor is not liable for damages. Imbes na bayaran ko yung 20k, piliin ko nalang si item 1 para ma-extinguish yung obligation ko mag bayad, wala rin akong payment of interest, wala ring payment of damages sa part ng creditor **Article 1204**. The creditor shall have a right to indemnity for damages when, through the fault of the debtor, all the things which are alternatively the object of the obligation have been lost, or the compliance of the obligation has become impossible. The indemnity shall be fixed taking as a basis the value of the last thing which disappeared, or that of the service which last became impossible. Damages other than the value of the last thing or service may also be awarded. (1135a) *It talks about the effect of loss or becoming impossible of objects of the obligation.* **Articles 1203 and 1204 apply when the right of choice belongs to the debtor**. - In Article 1203, the thing was lost due to the fault of the creditor. In Article 1204, the thing was lost due to the fault of the debtor. Kapag some of objects or prestations ang nawala or become impossible even through the fault of debtor. Then the debtor is not liable since he has the right of choice and the obligation can still be performed. This is an exception to the general rule establishing Art. 1170 regarding liability of damages arising from negligence. - Article. 1204, when one or some of the prestations are lost due to the debtor's fault, it is an exception to article 1170. if all the prestations are lost due to debtor's fault, then creditor would have the right to indemnity. if all prestations are lost because of debtor's fault, then it is liability for damages. If all lost through fortuitous event, then the obligation shall be extinguished. Example: S obliged himself to deliver item 1, 2 , or 3. if item 1 is lost because of fault of s, then he can still choose between item 2 or 3. then the loss of item 1 or 2 with or without the fault of s will reduce the obligation to a simple one. if all items are lost because of the fault of s, creditor would have the right to indemnity. Value of indemnity shall be taking as basis of value of the last thing which disappeared or that of the service which thus became impossible. in case of disagreement, it is incumbent upon the creditor to prove such value or which thing last disappeared which service last became impossible, other damages may likewise be rewarded. **Article 1205**. When the choice has been expressly given to the creditor, the obligation shall cease to be alternative from the day when the selection has been communicated to the debtor. Until then the responsibility of the debtor shall be governed by the following rules: \(1) If one of the things is lost through a fortuitous event, he shall perform the obligation by delivering that which the creditor should choose from among the remainder, or that which remains if only one subsists; \(2) If the loss of one of the things occurs through the fault of the debtor, the creditor may claim any of those subsisting, or the price of that which, through the fault of the former, has disappeared, with a right to damages; \(3) If all the things are lost through the fault of the debtor, the choice by the creditor shall fall upon the price of any one of them, also with indemnity for damages. The same rules shall be applied to obligations to do or not to do in case one, some or all of the prestations should become impossible. (1136a) a. If one of the things is lost through a fortuitous event, he shall perform the obligation by delivering that which the creditor should choose from among the remainder, or that which remains if only one subsists; b. If the loss of one of the things occurs through the fault of the debtor, the creditor may claim any of those subsisting, or the price of that which, through the fault of the former, has disappeared, with a right to damages; c. If all the things are lost through the fault of the debtor, the choice by the creditor shall fall upon the price of any one of them, also with indemnity for damages. - **Facultative obligation** -- only one prestation has been agreed upon but the obligor may render another in substitution. A facultative obligation exists when the obligation specifies a primary (principal) prestation, with the obligor having the option to perform a different one as a substitute. The obligor can choose to fulfill either the original obligation or the substitute. EXAMPLE: i promised to give Aira a piano. But I told you na I may also give a tv set as a substitute. It is considered as facultative obligation because only one prestation is due but obligor may render another as substitute. In this obligation, only the piano is due hence its loss through the creditor's fault may make the debtor liable. - Ang kailangan i-communicate dito is yung substitute na gagawin. Kung nagkaroon ng loss before substitution, **if the principal thing is lost through a fortuitous event, then the obligation is extinguished**. **Otherwise, the debtor is liable for damages**. - Kung nawala yung piano at di pa ako nakakapagcommunicate ng substitute, then liable ako for damages. Because the loss of the thing intended as a substitute with or without the fault of debtor does not render him or the debtor liable. The reason is that the thing intended as a substitute is not due. The effect of the loss is merely to extinguish the facultative character of the obligation. EXAMPLE: R give A item one, or if R wants, he may give item 2. In this case, if item 1 is lost through a fortuitous event, the obligation of R is extinguished. If the item 1 is lost because of R's fault, then R is liable for damages. If item 2 is lost with or without fault of R, R is still liable to deliver item 1 and he is not liable for damages for the loss of item 2 because it is not due. - hanggat di pa nagcocommunicate, ang due parin is principal thing. pero pag nagcommunicate with right of choice and nawala yung substitute after communication, liable na kasi due na yung sub item. - Kahit anong mangyari sa principal, hindi na liable si debtor sa damage kasi yung substitute na yung due and demandable according to recent communication. Once the communication is made, the obligation is converted into simple one to deliver or perform the substituted thing or prestation. Example: if item 1 is lost with or without the fault of R, he is not liable for its loss since his obligation is to deliver the item 2. If item 2 is lost because of fortuitous event, the obligation is extinguished. If item 2 is lost because of fault of R then he is liable for damages **DISTINCTIONS BETWEEN ALTERNATIVE AND FACULTATIVE OBLIGATIONS**: AS TO **NUMBER OF PRESTATIONS**: - **ALTERNATIVE** has several prestation na due but compliance with one is sufficient. - **FACULTATIVE** has only one prestation which is actually due but the debtor is allowed to substitute another. RIGHT OF CHOICE: - **ALTERNATIVE** -- the right of choice may be given to creditor or third person. generally, is debtor. - **FACULTATIVE** -- the right to choose between prestations is only given to the debtor. No exceptions. LOSS THROUGH **FORTUITOUS EVENT**: **ALTERNATIVE** -- the loss of one or more of the alternatives through a fortuitous event does not extinguish the obligation. **FACULTATIVE** -- the loss of the thing due may it be the principal before substitution or the substitute after substitution. Then, it will extinguish the obligation. LOSS **THROUGH FAULT OF DEBTOR**: - **ALTERNATIVE** -- the loss of one of alternatives through fault of debtor does not render him liable. If in the choice of creditor, the loss of one of the alternative through the fault of the debtor gives rise to liability for damages. - **FACULTATIVE** -- the loss of the thing due to debtor's fault makes him liable. Principal or substitute. But if the loss of substitute before the substitution through the fault of the debtor, it would not render him liable. **NULLITY OF PRESTATION**: - **ATERNATIVE** -- does not invalidate the others and the debtor or creditor shall choose from among the remainder. - **FACULTATIVE** -- if the principal prestation (main obligation) is void, the entire obligation becomes null and void, even if there is an option for a substitute prestation. This is because the existence of the substitute relies on the validity of the principal obligation **SECTION 4. -- Joint and Solidary Obligations** **Article 1207**. **The concurrence of two or more creditors or of two or more debtors in one and the same obligation does not imply that each one of the former has a right to demand, or that each one of the latter is bound to render, entire compliance with the prestation. There is a solidary liability only when the obligation expressly so states, or when the law or the nature of the obligation requires solidarity. (1137a)** - **Solidarity** means that each creditor or debtor has rights and obligations that are not only shared but are also enforceable individually. For example, in a solidary obligation among three debtors, each debtor is responsible for the entire obligation, and each creditor can demand full performance from any one of the debtors. - When two or more creditors or debtors are involved in the same obligation, it doesn\'t automatically mean that each creditor can demand full payment or that each debtor must fulfill the entire obligation. This means that *unless there is a solidary arrangement*, ***each creditor and debtor is only entitled to a proportionate share of the obligation*** or is only responsible for their part of the obligation. - **Solidarity must be expressly stated in the obligation**. If the agreement specifies that the creditors are solidary creditors or that the debtors are solidary debtors, then the rules of solidarity apply. Example of Multiple Creditors: Example of Multiple Debtors: **Kinds of obligations according to the number of parties.** - **Individual Obligation** -- there is only one debtor and one creditor in a contract - **Collective Obligation** -- there are two or more debtor and two or more creditors - **Kinds of Collective Obligations** - **Joint Obligation**-- where the whole obligation is to be *paid or fulfilled proportionately* by the different debtors and/or *demanded proportionately by the different creditors*. This is the presumption in all collective obligation unless solidarity is expressly stated. - **Solidary Obligation**-- where *each one of the debtors is bound render*, and/or *each creditor has the right to demand* from any of the debtors, the entire compliance with the prestation. - Passive/solidarity - full payment made by anyone of the solidary debtors extinguishes the obligation. The one who paid ***can claim reimbursement*** from his co debtors as regards their corresponding shares in the obligation. Ex: A, B, & C are solidary debtors of D in the sum of P900. D can demand payment of the entire obligation when it becomes due, from any one of the debtors or from all of them at the same time. If C paid the whole P900 to D, he may claim reimbursement from A and B. - Active/solidarity - *full payment to any of the creditors* extinguishes the obligation. The creditor who received the entire amount **will be liable to pay the corresponding shares of his co-creditors** in accordance with their internal agreement. Ex: Garfield owes the sum of P40,000 to Mickey, Minnie, Donald, and Pluto, who are solidary creditors. Garfield can pay anyone of them. If Mickey received the P40,000, he is liable to pay the corresponding shares of his co-creditors. - Mixed Solidary - Solidary Debtors, Joint Creditors / Joint Debtors, Solidary Creditors **Collective obligation presumed to be joint.** 1. If A is liable to B for P9,000, there can be no problem regarding the determination of the following: a. The person liable to pay; b. The person entitled to demand payment c. The extent of the liability of the debtor; and d. The extent of the right of the creditor 2. Where there is **[a plurality of parties]** and the **share of each in the obligation is specified**, the correlative rights and obligations of the parties are known. **Article 1208. If from the law, or the nature or the wording of the obligations to which the preceding article refers the contrary does not appear, the credit or debt shall be presumed to be divided into as many shares as there are creditors or debtors, the credits or debts being considered distinct from one another, subject to the Rules of Court governing the multiplicity of suits**.(1138a) (PRESUMPTION THAT OBLIGATION IS JOINT) **Synonyms** - **JOINT Obligation** -- mancomunada ; mancomunada simple; proportionate ; pro rata - **SOLIDARY Obligation** -- joint and several; in solidum; mancomunada solidaria; juntos o separadamente; individually and collectively; each will pay the whole value - "**We promise to pay,** " when there are two o more signatures == JOINT LIABILITY - " **I promise to pay,** " when there are two or more signatures == SOLIDARY LIABLITY **Kinds of solidarity**. 1. According to the parties bound: a. **Passive Solidarity** -- solidarity on the **part of the debtors**, where *any one of* *them can be made liable* for the fulfillment of the entire obligation. It is in the nature of the **mutual guaranty** (Each debtor acts as a **guarantor** for the others. If one debtor pays the full amount, they have the right to seek reimbursement (or contribution) from the other debtors. b. **Active Solidarity** -- solidarity on the **part of the creditors**, where *anyone of them can demand the fulfillment* of the entire obligation. Its essential feature is that of **mutual representation** among the solidary creditors with powers to *exercise the rights of others in the* *same manner as their rights* (Each creditor acts as a representative of the others, holding the power to exercise the rights of the entire group of creditors. This arrangement prevents any creditor from claiming their share independently; rather, the collective obligation must be respected). c. **Mixed Solidarity** -- **solidarity on the part of the debtors and creditors**, where each one of the debtors is liable to render, and each one of the creditors has a right to demand, entire compliance with obligation. 2. According to source: d. **Conventional solidarity** -- where solidarity is agreed upon the parties (Art. 1306). If nothing is mentioned in the contract relating to solidarity, the obligation is only joint. e. **Legal solidarity** -- where solidarity is imposed by the law. f. **Real** **solidarity** -- where solidarity is imposed by the nature of the obligation. The obligation inherently requires that multiple debtors or creditors share responsibilities or rights together. Example: Suppose three individuals (A, B, and C) are co-owners of a piece of property. If they collectively owe a debt to a bank for a mortgage on that property, the bank can demand the full amount of the mortgage from any one of them. This is a real solidarity because the obligation arises from their joint ownership and the nature of their obligation to pay for the mortgage. - The law **does not explicitly enumerate all cases where liability is solidary** **due to the nature of the obligation**. Instead, the concept of real solidarity is generally understood through various legal principles and interpretations based on the inherent characteristics of certain obligations. Presumption subject to **rules on multiplicity of suits** works in relation to solidary obligations: - Under the rules on multiplicity of suits, the creditor can bring a case against any one debtor to fulfill the entire obligation. This prevents the creditor from having to file multiple lawsuits against each debtor for the same obligation. - Example: If three debtors (Anna, Ben, and Carl) are responsible for a solidary obligation, and the creditor wants the full payment of the debt, the creditor can choose to sue only Anna instead of filing three separate lawsuits against each of them. - This links to the presumption that **only one lawsuit should be enough to resolve the issue**, even though there are multiple parties involved in the obligation. The rule about multiplicity of suits encourages the creditor to [pursue the matter efficiently] without unnecessary multiple lawsuits, as long as the debtor they choose to sue can satisfy the entire debt. **Article 1209. If the division is impossible, the right of the creditors may be prejudiced only by their collective acts, and the debt can be enforced only by proceeding against all the debtors. If one of the latter should be insolvent, the others shall not be liable for his share.(1139)** - Article 1209 addresses situations where division of the obligation among creditors or debtors is not possible (indivisible). - **Joint Indivisible Obligations** are those that cannot be divided. **indivisible** referring to the object; **joint** referring to [the tie between parties] who are merely proportionately liable, unless solidarity has been stipulated by the parties or the law, in which case it is called a **solidary indivisible obligation**. For example, if multiple debtors owe a single sum of money for a singular obligation, that obligation cannot be split into parts that each debtor would pay. **CHARACTERISTICS:** - Obligation is joint but since the object is indivisible, the creditor must proceed against all the joint debtors, for compliance is possible only of all the joint debtors would act together. They cannot just have one debtor fulfill the obligation; all must agree on how to handle that property. - **Demand must be made on all the joint debtors**. Creditors must make their demand for compliance from all joint debtors. This means that if a creditor wishes to collect a debt, they must address all parties involved, not just one debtor. - if one debtor fails to meet their obligation, the liability is converted into one for damages the other debtors may share liability for damages resulting from this non-compliance. In a joint obligation, *all debtors are* *collectively responsible for fulfilling the obligation*. If one debtor doesn't comply, it affects the whole group. - Liability for Damages: If the non-compliance causes damage, the other debtors may be liable for these damages because they are jointly bound by the obligation. This means the consequences of one debtor's failure can extend to the others, reflecting the shared nature of joint obligations. - **If any of the joint debtors be insolvent, the others shall not be liable for his share**. This provision protects solvent debtors from unfairly shouldering the burden of an insolvent co-debtor. - If there be joint creditors, delivery must be made to all, and not merely to one, unless that one be specifically authorized by others. If three creditors are owed money, the debtor must make the payment to all three unless, for example, they have designated one creditor to collect the payment. - If one of the joint creditors refuse payment. The debtor may legally refuse to deliver the payment and may deposit by way of consignation (the person who owes the money can give it to someone else who is authorized to take it). - Each joint creditor is allowed to renounce (give up) his proportionate credit. This means a creditor can choose not to claim part of the obligation, which could potentially benefit the other creditors or debtors.' **Article 1210 -- The indivisibility of an obligation does not necessarily give rise to solidarity. Nor does solidarity of itself imply indivisibility.(n)** **Indivisibility as distinguished from Solidarity** 1. **Indivisibility** refers to the prestation (object/subject matter) while **solidarity** refers to the juridical tie or legal tie between the parties. 2. In **indivisible obligations**, *only the debtor guilty* of breach of obligation *is liable for damages*, while in **solidary obligation**, *all of the debtors are liable* for the breach of the obligation *committed by a debtor*. 3. **Indivisibility** can exist although there is only one debtor and one creditor, while in **solidarity,** there must be at least 2 creditors or 2 debtors. 4. In **indivisible obligations**, the others are not liable in case of insolvency of (1) one debtor, while in **solidary** obligation the other debtors are proportionately liable. Examples: - Joint divisible Obligation -- A and B are jointly liable to X for 1M - Joint Indivisible Obligation -- A and B are jointly liable to give X this car - Solidary Divisible Obligation -- A and B are solidary bound to give X 1M - Solidary Indivisible Obligation -- A and B are solidary bound to give X this car **Article 1211. Solidarity may exist although the creditors and the debtors may not be bound in the same manner and by the same periods and condition. (1140)** - solidarity among creditors and debtors can exist even if the terms of their obligations (such as manner, periods, and conditions) are not identical. Kinds of solidary obligation according to legal tie: - **Uniform** -- when the parties are bound by the same stipulation. - **Non-uniform** or **varied** -- when the parties are not subject to the same stipulation. - Creditors and debtors may be bound in different ways. For example, one debtor may be liable for a specific performance, while another debtor might be liable for a monetary payment. - The obligations may have different timeframes for fulfillment. - This flexibility in how creditors and debtors are bound allows for a more dynamic approach to obligations. It recognizes that parties can enter into solidarity arrangements that accommodate their unique circumstances. - It also provides protection for creditors, as they can pursue any debtor for the full amount owed, regardless of the individual terms of each obligation. **Article 1212. Each one of the solidary creditors may do whatever may be useful to the others, but not anything which may be prejudicial to the latter. (1141a)** - A solidarity creditor may do any act beneficial or useful to the others but he cannot perform any act prejudicial to them. - The rule is based on the **theory of mutual agency**---right of one to act for and in the name of the others among the solidary creditors. **Art. 1213**. **A solidary creditor cannot assign his rights without the consent of the others.** - A solidary creditor cannot transfer or assign their right to collect the debt to another party **unless all other solidary creditors agree.** - Since the other solidary creditors share in the potential to collect the entire debt, any assignment of one creditor's rights could impact on the rights of others. To protect this collective power, one creditor cannot transfer their rights independently. - If a solidary creditor attempts to ***assign their right without obtaining consent*** from the other creditors, the assignment could be ***considered*** ***invalid***. The collective nature of solidarity is upheld to protect each creditor's interest in the whole obligation. **Art. 1214**. **The debtor may pay any one of the solidary creditors; but if any demand, judicial or extrajudicial, has been made by one of them, payment should be made to him.(1142a)** - In a solidary obligation where there are multiple creditors, the debtor has the flexibility to pay any one of the solidary creditors. However, if one of the creditors has already made a demand (either through formal legal action or an informal request), the debtor is obligated to pay that specific creditor. This rule also helps to avoid conflicts among the creditors by recognizing the creditor who first acts to claim payment. **Art. 1215**. **Novation, compensation, confusion or remission of the debt, made by any of the solidary creditors or with any of the solidary debtors, shall extinguish the obligation, without prejudice to the provisions of article 1219.** **The creditor who may have executed any of these acts, as well as he who collect the debt, shall be liable to the others for the share in the obligation corresponding to them (1143)** FOUR (4) MODES OF EXTINGUISHMENT OF OBLIGATIONS. **Novation** --the modification by *changing its object or principal conditions*, or by substituting the person of the debtor, or by subrogating the person of the debtor, or by subrogating a third person in the rights of creditor. **Compensation** -- when two (2) persons, in their own right become creditors and debtors of each other. **Confusion** or **Merger of Rights** --which takes place when the characters of creditor and debtor are merged in the same person. When this happens, the debt is considered paid or extinguished because you can't owe a debt to yourself. - Confusion arises when the roles of debtor and creditor merge in one person. If a solidary debtor becomes the owner of the claim held by a solidary creditor, the obligation is extinguished. **Remission** or **Condonation** -- This is the gratuitous abandonment by the creditor of his right. Remission is the forgiveness or cancellation of the debt by the creditor. When a solidary creditor forgives a solidary debtor\'s debt, the entire obligation is extinguished. **Article 1216**. **The creditor may proceed against any one of the solidary debtors or some or all of them simultaneously. The demand made against one of them shall not be an obstacle to those which may subsequently be directed against the others, so long as the debt has not been fully collected.(1144a)** - Creditor's Choice: The ***creditor can choose to demand payment from any one*** of the solidary debtors, from some of them, or even from all of them at the same time. - Flexibility of Demand: The ***creditor isn't restricted to collecting from only one debtor at a time***. Even if they've already demanded payment from one debtor, they can still go after the others if the debt hasn\'t been fully satisfied. - Continuous Liability: The ***creditor has the right to pursue each solidary debtor until the total debt is paid off***. For example, if Debtor A partially pays but doesn't cover the whole debt, the creditor can go after Debtors B and C for the remaining amount. **Article 1217. Payment made by one of the solidary debtors extinguishes the obligation. If two or more solidary debtors offer to pay, the creditor may choose which offer to accept.** **He who made the payment may claim from his co-debtors only the share which corresponds to each, with the interest for the payment already made. If the payment is made before the debt is due, no interest for the intervening period may be demanded.** **When one of the solidary debtors cannot, because of his insolvency, reimburse his share to the debtor paying the obligation, such share shall be borne by all his co-debtors, in proportion to the debt of each**. - This article deals with what happens when one solidary debtor pays off a debt shared with other debtors. - **PAYMENT** = one of the ways by which an obligation is extinguished and consists in the delivery of the thing or the rendition of the service which is the object of the obligation. - **Full Payment Extinguishes the Obligation**: If one solidary debtor (Debtor A) pays the entire debt, the obligation is extinguished for all debtors. None of the other debtors need to pay the creditor anymore. - **Creditor's Choice When Multiple Debtors Offer Payment**: If more than one debtor offers to pay, the creditor has the right to choose which offer to accept. This gives the creditor flexibility in deciding who will clear the debt. - **Right to Reimbursement**: The debtor who pays off the debt has the right to ask their co-debtors to pay back their share: They are jointly liable to reimbursement. - **Solidary creditors** -- the receiving creditor is jointly liable to the others for their corresponding shares. For example, if A, B, and C each owe \$10,000 solidarily, and A pays the entire \$10,000, A can then demand \$5,000 each from B and C (their equal share of the debt). - **Interest Conditions**: If the debt was paid before its due date, the paying debtor cannot demand interest from co-debtors for that early payment. Only the principal amount of each debtor's share is claimable. - **Insolvent Co-Debtor's Share**: If one of the debtors (say Debtor B) is insolvent and cannot pay their share, the remaining co-debtors (including the one who paid) must absorb B\'s share proportionally. For example, if A paid the debt, and B is insolvent, A and C will divide B\'s share between them in proportion to their debt portions. **Article 1218 -- Payment by a solidary debtor shall not entitle him to reimbursement from his co-debtors if such payment is made after the obligation has prescribed or become illegal. (n)** **EFFECT OF PAYMENT OF AN** **ILLEGAL OBLGATION**- **No reimbursement** - Since the debt is no longer enforceable, the other co-debtors are not legally obligated to contribute. Paying a prescribed or illegal debt is essentially [a voluntary act] by the paying debtor, without legal grounds for recovering it from others. **Article 1219. The remission made by the creditor of the share which affects one of the solidary debtors does not release the latter from his responsibility towards the co-debtors, in case the debt had been totally paid by anyone of them before the remission was effected. (1146a)** If payment is made first, the remission or waiver is of no effect. There is no more obligation to remit. - **Remission of One Debtor's Share**: When a creditor forgives a part of the debt owed by a particular solidary debtor (for example, Debtor A), that debtor is released from paying their share **only to the creditor.** - **Responsibility to Co-Debtors Remains**: However, if another solidary debtor (say, Debtor B) has already fully paid the entire debt on behalf of all co-debtors before the creditor's remission, **Debtor A still owes their portion to Debtor B**. - **If payment is made first, the remission or waiver is of no effect**. Solutio indebiti arises. The purpose of this article is **to forestall fraud** whereby the debt having paid, - **Article 1217 (par.3)** says that the share of the insolvent co-debtor "shall be borne by all his co-debtors, in proportion to the debt of each." Example: **Payment before remission**: A, B, and C solidarily owe D P1,500.00. B paid the entire obligation. After which, D remitted the share of C. B can collect P500.00 each from A and C even if the share of C in the obligation had been remitted. **Remission before payment**: A, B, and C solidarily owe D P1,500.00. D remitted the share of C. Thereafter, B paid the entire obligation. B can collect P500.00 from A but not from C. However, B may ask D(creditor) to give back P500, which is the supposed-to-be share of C. - But if one of the co-debtors that was not forgiven became insolvent the forgiven debtor should also reimburse the paying debtor (who paid the insolvent's share). **Article 1220**. **The remission of the whole obligation, obtained by one of the solidary debtors, does not entitle him to reimbursement from his co-debtors.** - When a creditor grants a full remission (forgiveness) of the entire debt to one solidary debtor, it means the debt is entirely canceled, so none of the co-debtors need to pay any part of it anymore. - There is nothing to be reimbursed because he did not spend any money, the remission [being a gratuitous act]. - This rule helps ensure fairness by preventing one debtor from benefiting financially from a debt that no longer exists for anyone - Let\'s say there are three debtors---A, B, and C---who are all equally responsible for a debt of 30,000 pesos. If A somehow convinces the creditor to forgive the entire 30,000 pesos debt, then A doesn't have the right to demand 10,000 pesos from B and C each, even though they were originally responsible for a portion of the debt. **Article 1221**. **If the thing has been lost or if the prestation has become impossible without the fault of the solidary debtors, the obligation shall be extinguished**. **[If there was fault] on the part of any one of them, [all shall be responsible] to the creditor, for the price and the payment of damages and interest, without prejudice to their action against the guilty or negligent debtor.** **If through [a fortuitous event], the thing is lost or the performance has become impossible after one of the solidary debtors has incurred in delay through the judicial or extrajudicial demand upon him by the creditor, the provisions of the preceding paragraph shall apply. (1147a)** - It addresses what happens if the object of an obligation is lost or the performance becomes impossible in the context of solidary obligations. **Rules in case thing has [been lost] or prestation has [become impossible]:** - LOSS WITHOUT FAULT OR DELAY - no liability; the obligation is extinguished - LOSS DUE TO FAULT OF A SOLIDARY DEBTOR (WITH FAULT) - there is liability also for damages and interest. Due to the faul

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