Philippine Civil Code Articles 1-18 PDF

Effect of application of law Article 1 to 18 of the Civil code Article 1. This Act shall be known as the "Civil Code of the Philippines." (n) Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise provided. Th...

Effect of application of law Article 1 to 18 of the Civil code Article 1. This Act shall be known as the "Civil Code of the Philippines." (n) Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless it is otherwise provided. This Code shall take effect one year after such publication. (1a) Art. 3. Ignorance of the law excuses no one from compliance therewith. (2) Art. 4. Laws shall have no retroactive effect, unless the contrary is provided. (3) Art. 5. Acts executed against the provisions of mandatory or prohibitory laws shall be void, except when the law itself authorizes their validity. (4a) Art. 6. Rights may be waived, unless the waiver is contrary to law, public order, public policy, morals, or good customs, or prejudicial to a third person with a right recognized by law. (4a) Art. 7. Laws are repealed only by subsequent ones, and their violation or non-observance shall not be excused by disuse, or custom or practice to the contrary. When the courts declared a law to be inconsistent with the Constitution, the former shall be void and the latter shall govern. Administrative or executive acts, orders and regulations shall be valid only when they are not contrary to the laws or the Constitution. (5a) Art. 8. Judicial decisions applying or interpreting the laws or the Constitution shall form a part of the legal system of the Philippines. (n) Art. 9. No judge or court shall decline to render judgment by reason of the silence, obscurity or insufficiency of the laws. (6) Art. 10. In case of doubt in the interpretation or application of laws, it is presumed that the lawmaking body intended right and justice to prevail. (n) Art. 11. Customs which are contrary to law, public order or public policy shall not be countenanced. (n) Art. 12. A custom must be proved as a fact, according to the rules of evidence. (n) Art. 13. When the laws speak of years, months, days or nights, it shall be understood that years are of three hundred sixty-five days each; months, of thirty days; days, of twenty-four hours; and nights from sunset to sunrise. If months are designated by their name, they shall be computed by the number of days which they respectively have. In computing a period, the first day shall be excluded, and the last day included. (7a) Art. 14. Penal laws and those of public security and safety shall be obligatory upon all who live or sojourn in the Philippine territory, subject to the principles of public international law and to treaty stipulations. (8a) Art. 15. Laws relating to family rights and duties, or to the status, condition and legal capacity of persons are binding upon citizens of the Philippines, even though living abroad. (9a) Art. 16. Real property as well as personal property is subject to the law of the country where it is stipulated. However, intestate and testamentary successions, both with respect to the order of succession and to the amount of successional rights and to the intrinsic validity of testamentary provisions, shall be regulated by the national law of the person whose succession is under consideration, whatever may be the nature of the property and regardless of the country wherein said property may be found. (10a) Art. 17. The forms and solemnities of contracts, wills, and other public instruments shall be governed by the laws of the country in which they are executed. When the acts referred to are executed before the diplomatic or consular officials of the Republic of the Philippines in a foreign country, the solemnities established by Philippine laws shall be observed in their execution. Prohibitive laws concerning persons, their acts or property, and those which have, for their object, public order, public policy and good customs shall not be rendered ineffective by laws or judgments promulgated, or by determinations or conventions agreed upon in a foreign country. (11a) Art. 18. In matters which are governed by the Code of Commerce and special laws, their deficiency shall be supplied by the provisions of this Code. (16a) 1.Determine when legal / Civil Personality is acquired and lost Overview: The concept of personality, as understood in Philippine civil law, refers to the legal capacity of an individual to acquire rights and to assume obligations. This capacity originates from the time of birth, creating a legal status or “juridical capacity” for natural persons that allows them to be recognized as subjects under the law. Here’s a detailed breakdown of the acquisition of personality for natural persons under Philippine civil law: 1. Legal Framework and Relevant Provisions The acquisition of personality for natural persons is primarily governed by the Civil Code of the Philippines, particularly under the following articles: Article 37 - Establishes that “Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every natural person and is lost only through death.” Article 40 - Provides that birth determines personality; however, a conceived child (nasciturus) acquires provisional personality. Article 41 - Outlines the conditions under which a conceived child is considered born for civil purposes, establishing viability as a requirement. Article 42 - Stipulates that civil personality is extinguished upon death. Article 43 - Addresses exceptions in cases of simultaneous death (commorientes), especially relevant for succession purposes. These articles collectively underscore that personality for natural persons is acquired at birth and is lost upon death, with specific rules for cases involving unborn children and situations where simultaneous death may complicate inheritance rights. 2. Acquisition of Civil Personality: Birth as the Legal Event Personality at Birth: In Philippine law, a natural person acquires personality at the moment of live birth. This means that from the time a child is born alive, they are considered a person with rights, obligations, and legal status. Viability Requirement: Article 41 specifies that the child must be born in a state of viability, meaning the child must be capable of sustaining life outside the womb, either with or without medical intervention. This is essential because a non-viable birth (e.g., a miscarriage or stillbirth) does not confer civil personality on the child. 3. Special Rule on Unborn Children (Nasciturus Doctrine) Concept of the Nasciturus: The term nasciturus refers to a conceived but unborn child. Under the Civil Code, a child already conceived is entitled to certain provisional rights, particularly in inheritance and succession, provided they are born alive. Provisional Personality of a Conceived Child: Article 40 provides that an unborn child acquires provisional personality, meaning the law recognizes the unborn child as having potential legal status conditioned on birth. The unborn child may inherit property or be entitled to support under certain conditions, subject to being born alive. This provisional personality is a unique doctrine allowing a conceived child to hold rights, even if not yet physically separate from the mother, ensuring potential legal protection. Conditional Nature of Rights: The rights of an unborn child under Philippine law are conditional on live birth. Should the child be born dead, the provisional personality and any accrued rights are retroactively nullified. 4. Rights and Capacities of a Natural Person Post-Birth Once a civil personality is acquired at birth, a person is entitled to a range of legal rights and responsibilities. These include: Right to Own Property: From birth, a person is capable of holding property, either through inheritance, donation, or other lawful means. Right to Legal Representation: Minors and other persons with limited capacity are entitled to have legal representatives (e.g., parents or guardians) manage their legal affairs. Capacity to Sue and Be Sued: Natural persons, once they acquire civil personality, are capable of participating in legal proceedings either as plaintiffs or defendants. 5. Extinction of Civil Personality at Death Legal Effect of Death: According to Article 42, a natural person’s civil personality is extinguished upon death. This means that all legal rights and obligations attached to the person terminate unless specifically provided otherwise by law (e.g., rights that pass on through succession). Exception – Simultaneous Death (Commorientes): In situations where two or more persons (e.g., heirs and a decedent) die in circumstances that make it impossible to determine the sequence of their deaths, Article 43 establishes a presumption relevant to inheritance. Under the rule of commorientes, when the order of death is uncertain, they are deemed to have died at the same time, and no rights of inheritance are transmitted between them. 6. Specific Applications in Philippine Law Inheritance Rights: The nasciturus doctrine is most commonly applied in matters of inheritance. For example, a child conceived at the time of a decedent’s death may inherit if born alive, safeguarding the potential inheritance rights of the unborn child. Support Obligations: Support may also be granted to an unborn child under certain circumstances, especially where a legal presumption of paternity exists or where the unborn child is a presumptive heir. Parental Authority: The acquisition of personality at birth makes a child a direct subject of parental authority, entitling them to care, support, and custody under Philippine family law. 7. Summary The acquisition of personality in Philippine civil law is a foundational concept that: Establishes birth as the legal event for acquiring full civil personality, conditional on viability. Recognizes provisional rights for unborn children, safeguarding inheritance and support rights. Terminates civil personality at death, with specific rules for simultaneous death scenarios. This legal framework ensures that the rights of natural persons are recognized from birth and provides for specific protections for conceived children, balancing the needs of succession, inheritance, and family law. 2. Distinguish different types of persons The term Person is derived from the Latin word 'Persona' it means those who are recognized by law as being capable of having legal rights and duties. Definition: 1) Salmond - “A person is any being whom the law regards as capable of rights and bound by legal duties. 2) Savigny defines the term person as the subject or bearer of a right. 3) According to Gray A person is an entity to which rights and duties may be attributed. 4) According to Austin the term 'person' includes physical or natural person including every being which can be deemed human. According to Section 11 of the Indian Penal code the word person includes any company or association, or body of Persons, whether Incorporated or not. Kinds of Persons: There are two kinds of persons are as follows I) Natural persons II) Legal persons ( legal persons are also known as juristic, fictitious or artificial persons ) I) Natural Person: A natural person is a human being possessing natural personality. According to Holland, a natural person is a human being as is regarded by the law as capable of rights and duties. Requisite of normal human being is that he must be born alive moreover; he must possess essentially human characteristics. Generally a person/human being who has a capacity to sue and be sued is person. II) Legal persons / Artificial persons: A legal person has a real existence but its personality is fictitious. A fictitious thing is that which does not exist in fact but which is deemed to exist in the eye of law. Example: Company or corporation, idol etc. Legal status of Dead Person: Dead persons have no legal personality and hence, cannot sue and be sued. Dead men are no longer persons in the eye of law. Legal personality of a person dies with his person. They do not remain the owners of their property until their successors enter upon their inheritance. When a person dies leaving Will, his property is distributed according to the Will. Law recognizes and takes account after the death of the person of his desires and interest when alive. There are three things in respect of which the anxieties of living men extend even after their death. Those are his body, his reputation and his property. 1) His Body: A living person is interested in the treatment to be given to his own body. A person is interested in a decent funeral and good burial. Criminal law secures a decent burial for all dead persons and the violation of a grave is a criminal offence. It is because to the respect the feelings of the relatives of a dead person, not in protection of dead person are right. 2) His reputation: Everyone is interested in maintaining reputation even after death. The reputation of a dead person receives some degree of protection from the criminal law. Defamation suit can be filed for loss of reputation of a dead person. If the publication is an attack on the internet of living persons, as a matter of fact, this right is in reality not that of the dead person but of his living Descendants. 3) His Property/ Estate: A man is dead but his hand may continue to regulate and determine the enjoyment of the property he owned while he was alive. He can dispose of his property by WILL. when a person dies intestate ( dies living will) the property is distributed according to the WILL. Legal Status of Unborn Person Generally an unborn person has no legal standing in the eyes of law. However it has to be distinguished from the one who is living but not yet born, i.e., a child in womb of its mother-in utero and an unborn child in the sense of future generations. A child in the uterus is regarded as a person in law in accordance with the maxim “Nascitures Pro Ham Nato Habetur i.e. One who is to be born is deemed to have been born”. Contingent rights: The rights of an unborn person, whether personal or proprietary, are all contingent on his birth as a living human being. Damages: damages can be claimed for injury to the fetus of a woman if the woman was known to be pregnant. Posthumous child can claim compensation for the death of his father in fatal accident. In Hindu law unborn son acquires an interest in the joint family property from the time of its conception. In English law a posthumous child inherits and if born alive though it may die moments later it affects the course of succession. A women convicted cannot be executed if she is pregnant. 3. Understand the legal effects of Civil Personality General Provision Art. 37 to 39 BOOK I PERSONS Title I. - CIVIL PERSONALITY CHAPTER 1 GENERAL PROVISIONS Art. 37. Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every natural person and is lost only through death. Capacity to act, which is the power to do acts with legal effect, is acquired and may be lost. (n) Art. 38. Minority, insanity or imbecility, the state of being a deaf-mute, prodigality and civil interdiction are mere restrictions on capacity to act, and do not exempt the incapacitated person from certain obligations, as when the latter arise from his acts or from property relations, such as easements. (32a) Art. 39. The following circumstances, among others, modify or limit capacity to act: age, insanity, imbecility, the state of being a deaf-mute, penalty, prodigality, family relations, alienage, absence, insolvency and trusteeship. The consequences of these circumstances are governed in this Code, other codes, the Rules of Court, and in special laws. Capacity to act is not limited on account of religious belief or political opinion. A married woman, twenty-one years of age or over, is qualified for all acts of civil life, except in cases specified by law. (n) Natural Persons Art. 40 to 43 CHAPTER 2 Natural Persons ARTICLE 40. Birth determines personality; but the conceived child shall be considered born for all purposes that are favorable to it, provided it be born later with the conditions specified in the following article. (29a) ARTICLE 41. For civil purposes, the foetus is considered born if it is alive at the time it is completely delivered from the mother’s womb. However, if the foetus had an intra-uterine life of less than seven months, it is not deemed born if it dies within twenty-four hours after its complete delivery from the maternal womb. (30a) ARTICLE 42. Civil personality is extinguished by death. The effect of death upon the rights and obligations of the deceased is determined by law, by contract and by will. (32a) ARTICLE 43. If there is a doubt, as between two or more persons who are called to succeed each other, as to which of them died first, whoever alleges the death of one prior to the other, shall prove the same; in the absence of proof, it is presumed that they died at the same time and there shall be no transmission of rights from one to the other. (33) Juridical Persons Art. 44 to 47 CHAPTER 3 Juridical Persons ARTICLE 44. The following are juridical persons: (1) The State and its political subdivisions; (2) Other corporations, institutions and entities for public interest or purpose, created by law; their personality begins as soon as they have been constituted according to law; (3) Corporations, partnerships and associations for private interest or purpose to which the law grants a juridical personality, separate and distinct from that of each shareholder, partner or member. (35a) ARTICLE 45. Juridical persons mentioned in Nos. 1 and 2 of the preceding article are governed by the laws creating or recognizing them. Private corporations are regulated by laws of general application on the subject. Partnerships and associations for private interest or purpose are governed by the provisions of this Code concerning partnerships. (36 and 37a) ARTICLE 46. Juridical persons may acquire and possess property of all kinds, as well as incur obligations and bring civil or criminal actions, in conformity with the laws and regulations of their organization. (38a) ARTICLE 47. Upon the dissolution of corporations, institutions and other entities for public interest or purpose mentioned in No. 2 of article 44, their property and other assets shall be disposed of in pursuance of law or the charter creating them. If nothing has been specified on this point, the property and other assets shall be applied to similar purposes for the benefit of the region, province, city or municipality which during the existence of the institution derived the principal benefits from the same. (39a) Module 2, Week 2 to 7 : Contracts ​ Compose a valid and enforceable contract. Determine the validity or enforceability of a contract. ​ Elements of a Contract in Civil Law ​ ​ In Philippine civil law, a contract is defined as a meeting of minds between two or more persons whereby one binds oneself, with respect to the other, to give something or to render some service. For a contract to be valid and enforceable, it must have the essential elements as stipulated in the Civil Code of the Philippines. These essential elements determine the existence, validity, and enforceability of a contract. Contracts may also have natural, accidental, and formal elements depending on the type of contract and its terms. ​ ​ Essential Elements of a Contract ​ The essential elements of a contract are divided into three categories: (1) Consent, (2) Object, and (3) Cause. Each of these elements is indispensable for the creation of a valid contract. Here’s an in-depth breakdown: ​ ​ 1. Consent ​ Consent refers to the agreement between parties to enter into a contract. Consent must be mutual and must involve a true meeting of the minds. This means that both parties must fully understand the terms and obligations they are entering into without any reservations. ​ ​ Requirements for Consent: ​ ​ Capacity to Act: Parties must have legal capacity to enter into a contract. This typically means that the parties are of legal age (18 years or older in the Philippines) and are not otherwise disqualified by law (e.g., mentally incapacitated individuals). ​ Free Will: Consent must be freely given. A contract entered into under duress, intimidation, fraud, undue influence, or mistake does not reflect true consent and may render the contract voidable. ​ Conformity to the Terms: Consent is perfected when the offer made by one party is unconditionally accepted by the other. Any counter-offers or conditions imply that there is no consent. ​ Vitiating Factors Affecting Consent: ​  ​ Mistake: A misunderstanding of a fact related to the contract. If material to the agreement, it may invalidate consent. ​ Violence or Intimidation: If one party is threatened or forced, it vitiates consent. ​ Undue Influence: One party taking advantage of their power over another to force consent invalidates it. ​ Fraud: Deliberate deceit or misrepresentation of facts to obtain consent is grounds for invalidating the contract. ​ 2. Object (Subject Matter) ​ The object, or subject matter, of a contract is the thing or service that the parties have agreed to give or perform. The object must meet certain criteria to be valid: ​ ​ Requirements for a Valid Object: ​ ​ Lawful: The object must not be illegal, immoral, or contrary to public policy. For instance, contracts to commit illegal acts or perform prohibited activities are void. ​ Definite or Determinable: The object of the contract must be clearly identifiable. If the object is ambiguous or cannot be determined, the contract may be void. ​ Within the Commerce of Man: The object must be something that can be legally owned, transferred, or provided. This excludes items that cannot be legally possessed or traded, like national treasures or certain public properties. ​ Types of Objects in Contracts: ​ ​ Thing: This can be a tangible item, property, or asset (e.g., real estate, vehicles). ​ Service: This refers to an act or activity that one party will perform for the other (e.g., employment, consultancy). ​ 3. Cause (Causa) ​ The cause, or consideration, of a contract is the underlying reason or motive that prompts each party to enter into the contract. It is the purpose of the obligation. For a contract to be valid, the cause must be lawful and must exist at the time the contract is entered. ​ ​ Requirements for Cause: ​ ​ Existence: The cause must be present. Contracts without cause are void. ​ Legality: The cause must not be illegal or contrary to law, public order, or good customs. ​ Adequacy and Sufficiency: Generally, the courts do not question the adequacy of the cause as long as it is lawful. However, gross inadequacy might indicate an underlying defect, such as fraud or mistake. ​ Types of Causes in Contracts: ​ ​ Onerous Contracts: In these contracts, each party is bound to provide something to the other, creating a reciprocal obligation (e.g., in sales, the buyer’s money is the cause for the seller, and the item sold is the cause for the buyer).  ​ Gratuitous Contracts: Only one party provides something without expecting any return (e.g., a donation). ​ Remunerative Contracts: A party gives something or provides a service in consideration of a past act that the other party performed. ​ Natural, Accidental, and Formal Elements ​ In addition to essential elements, contracts may also contain natural, accidental, and formal elements: ​ ​ Natural Elements ​ Natural elements are those that are expected to exist in a contract by the nature of the relationship between the parties, unless expressly excluded. For example, a warranty in a sale contract may be considered a natural element unless explicitly waived. ​ ​ Accidental Elements ​ Accidental elements are stipulations that the parties may introduce based on their agreement but are not essential. These include specific terms or conditions, such as the mode of payment, warranties, or indemnities, which tailor the contract to the parties’ needs. ​ ​ Formal Elements ​ Some contracts require specific formalities to be enforceable, such as notarization or being in written form. For instance: ​ ​ Form for Validity: Certain contracts require a particular form for them to be valid (e.g., donation of real property requires a public instrument). ​ Form for Enforceability: Some contracts, under the Statute of Frauds, must be in writing to be enforceable (e.g., contracts for sale of goods exceeding a certain amount). ​ Additional Considerations ​ Perfection of Contracts: A contract is perfected when all three essential elements—consent, object, and cause—are present. From that moment, both parties are bound to fulfill their respective obligations. ​ ​ Compliance with Conditions: Some contracts are conditional. Conditions can be either suspensive (obligations arise only after the condition is fulfilled) or resolutory (obligations are extinguished upon occurrence of the condition). ​ ​ Void and Voidable Contracts: If any essential element is absent, the contract may either be void or voidable. Void contracts produce no legal effect and cannot be ratified. Voidable contracts, however, are binding unless annulled by a party due to defects in consent, such as vitiation through mistake, intimidation, violence, undue influence, or fraud. ​  ​ Defective Contracts: Defective contracts refer to those that are either rescissible, voidable, unenforceable, or void. Each type of defect has specific grounds and consequences under the Civil Code. ​ ​ In summary, the formation of a valid contract in Philippine civil law requires the presence of consent, a lawful and determinate object, and a lawful cause. Additional natural, accidental, and formal elements may apply depending on the contract’s nature and parties’ stipulations. The absence or defect of any essential element may lead to the nullity or voidability of the contract, affecting its enforceability and binding force on the parties. ​ Under Philippine law, the principle of the Obligatory Force of a Contract is a fundamental aspect of obligations and contracts. This principle is embedded in the Civil Code, particularly in Article 1159, which states: "Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith." Here, we will break down and analyze the scope, applications, limitations, and jurisprudential support for the obligatory force of contracts, underscoring the vital role this principle plays in binding contractual relationships. ​ ​ 1. Definition and Scope of the Obligatory Force of Contracts ​ The obligatory force of contracts essentially means that a valid contract entered into freely by both parties has the force of law. This enforceability is equivalent to any other binding legal rule, and it obligates parties to observe the contract as they would a statute. Contracts must be honored and complied with, and this obligatory force ensures legal stability and predictability in business transactions and personal agreements alike. ​ ​ 2. The Principle of Good Faith in Compliance ​ Good faith is a crucial principle in enforcing contracts, as stipulated by Article 1159. This requirement obligates both parties to comply honestly and faithfully with their contractual commitments. Good faith extends to refraining from acts that would prevent fulfillment of the contract or diminish the agreed-upon obligations. Breaches caused by intentional or negligent actions that prevent contractual performance are generally grounds for legal remedies, such as damages or specific performance. ​ ​ Key Aspects of Good Faith: ​ Objective Good Faith: Observing fairness and sincerity in the contractual performance, avoiding deceptive or manipulative actions. ​ Subjective Good Faith: Ensuring each party genuinely intends to fulfill their commitments under the terms of the contract. ​ 3. Consent, Object, and Cause: Validity Requirements for Contracts ​ For the obligatory force to apply, a contract must satisfy the basic elements of consent, object, and cause under Article 1318. A defect in any of these elements  can render the contract void or voidable and, thus, incapable of enforcing the obligatory force: ​ ​ Consent: The will of the parties to enter the contract, which must be given freely, without duress, mistake, or undue influence. ​ Object: The subject matter of the contract, which must be lawful, possible, and determined or determinable. ​ Cause: The reason or purpose behind the contract, which must be lawful and moral. ​ When these elements are met, a contract is deemed valid, and its obligatory force is recognized by law. ​ ​ 4. Freedom of Contract and Its Limitations ​ The freedom of contract is a foundational principle in Philippine contract law. It allows parties to stipulate their own terms and conditions, provided they do not violate the law, public policy, or morals. This principle gives individuals and entities autonomy to negotiate and enter into agreements that best suit their interests. ​ ​ Limitations: ​ While the freedom to contract is robust, it is not absolute. Article 1306 of the Civil Code imposes restrictions: any contract whose stipulations violate the law, morals, good customs, public order, or public policy is void and unenforceable. Examples include contracts for illegal activities or those involving immoral transactions. ​ ​ 5. Effects of the Obligatory Force of Contracts ​ When a contract has obligatory force: ​ ​ Binding on the Parties: The contracting parties are bound to fulfill their commitments, even if the terms become disadvantageous or inconvenient, unless there are valid grounds for rescission or annulment. ​ Non-repudiation: Once bound, a party cannot unilaterally revoke or alter a contract without the other party’s consent, except in cases allowed by law (e.g., mutual agreement, legal causes of rescission). ​ Third-Party Impact: While contracts generally bind only the parties involved, certain stipulations, such as those in contracts benefiting third parties (stipulation pour autrui), may extend contractual obligations to third parties. In such cases, the third party can enforce the benefit without being a signatory. ​ 6. Exception: Rescissible, Voidable, Void, and Unenforceable Contracts ​ Certain contracts may appear valid initially but are subject to exceptions that affect their enforceability: ​  ​ Rescissible Contracts (Article 1380): Contracts that may be rescinded due to damages caused to one of the parties or third parties, such as fraudulent conveyances. ​ Voidable Contracts (Article 1390): Contracts entered into due to mistake, violence, intimidation, undue influence, or fraud. They are valid until annulled. ​ Void Contracts (Article 1409): Contracts void ab initio, either for lack of an essential element or because they are contrary to law or public policy. Void contracts cannot be enforced. ​ Unenforceable Contracts (Article 1403): Contracts that cannot be enforced in court due to lack of authority or form, though they may be ratified in certain cases. ​ 7. Breach of Contract and Legal Remedies ​ When a party fails to honor the obligatory force of a contract, the aggrieved party may resort to several remedies under the Civil Code: ​ ​ Specific Performance (Article 1165): The court may compel the breaching party to fulfill their contractual obligations if possible. ​ Rescission (Article 1381): Termination of the contract due to failure to perform essential obligations or to prevent unjust enrichment. ​ Damages (Article 1170): The non-breaching party may seek damages for losses caused by delay, fraud, negligence, or intentional failure to comply with the terms. ​ Substitute Performance: In some cases, the aggrieved party may undertake performance of the contract at the expense of the breaching party. ​ 8. Jurisprudential Interpretation ​ Philippine courts have upheld the obligatory force of contracts in numerous cases, emphasizing the contractual autonomy and binding nature of agreements. The Supreme Court has reiterated that contractual stipulations must be observed as the law between the parties, ensuring that courts respect the terms unless they conflict with legal principles. Some landmark cases: ​ ​ Filinvest Land, Inc. v. CA: Held that the contract has the force of law, and both parties must comply with all stipulations in good faith. ​ Valenzuela v. CA: Emphasized that obligations from valid contracts must be honored, and courts cannot alter the terms to relieve a party from an unfavorable bargain unless legally justified. ​ 9. Obligatory Force in Special Contracts ​ Certain contracts have special obligations: ​ ​ Sales Contracts: Delivery and transfer of ownership are essential obligations, and risks transfer upon delivery, adhering strictly to agreed terms. ​ Leases: The lessor must ensure the enjoyment of the leased property, while the lessee must pay rent and use the property as stipulated.  ​ Agency Contracts: The agent must act in accordance with the principal’s instructions, maintaining fiduciary obligations, while the principal is bound to honor the agent’s lawful actions on their behalf. ​ 10. Summary of Key Points ​ Contracts are binding between parties and enforceable as law. ​ Good faith and fair dealing are essential in contract performance. ​ Freedom to contract is limited by legality, morality, and public policy. ​ Parties may not unilaterally terminate or modify a contract except as legally permitted. ​ Remedies for breach include specific performance, rescission, damages, and substitute performance. ​ Jurisprudence reaffirms respect for contractual autonomy, ensuring predictability and fairness. ​ The obligatory force of contracts upholds legal stability and enforces mutual respect in private agreements, underscoring the necessity for parties to observe contractual commitments in good faith and within the bounds of Philippine law. ​ Review and critique a written contract using Civil Code provisions on obligations and ​ Contracts. ​ Identify appropriate remedies for defective contracts ​ Defective Contracts | Contracts | OBLIGATIONS AND CONTRACTS CIVIL LAW Under Philippine civil law, contracts can become defective in various ways, potentially invalidating them or limiting their enforceability. Defective contracts are addressed in Book IV, Title II, Chapter 7 of the Civil Code of the Philippines. A contract's defectiveness can arise due to issues with its validity, consent, object, cause, or form. Defective contracts are primarily categorized as (1) Rescissible Contracts, (2) Voidable Contracts, (3) Unenforceable Contracts, and (4) Void or Inexistent Contracts. Each type has distinct features, grounds, and effects, which are as follows: 1. Rescissible Contracts Rescissible contracts are initially valid and binding, but they may be rescinded, or canceled, due to certain external factors that prejudice the rights of a party or a third person. Articles 1380–1389 of the Civil Code govern these contracts. Grounds for Rescission A contract may be rescinded on the following grounds: Contracts entered into by guardians where the ward suffers a lesion (injury) exceeding one-fourth of the value of the objects in the contract (Art. 1381). Contracts by representatives in cases where the person represented suffers a lesion exceeding one-fourth of the value (Art. 1381). Contracts made in fraud of creditors when the latter cannot otherwise collect the claims (Art. 1381). Contracts concerning things under litigation that are entered into without court approval (Art. 1381). Other cases specifically provided by law (Art. 1381). Effects and Conditions of Rescission Rescission does not apply to cases where the party seeking rescission has no other legal remedy to protect their interest (Art. 1383). The action for rescission must be brought within four years (Art. 1389). Rescission is limited to the extent of the damage caused, making it a partial relief (Art. 1384). 2. Voidable Contracts Voidable contracts are valid until they are annulled. These contracts contain vitiated consent, meaning the consent of one of the parties was affected by mistake, violence, intimidation, undue influence, or fraud (Articles 1390–1402). Grounds for Annulment A contract is voidable if: One party was incapacitated to give consent (e.g., minor or mentally incapacitated) (Art. 1390). Consent was vitiated by mistake, violence, intimidation, undue influence, or fraud (Art. 1390). Effects and Conditions for Annulment A voidable contract is binding until annulled by a court. The action to annul based on incapacity or vitiated consent must be filed within four years (Art. 1391). If annulled, parties must return what they have received under the contract (Art. 1398). Ratification can validate a voidable contract, extinguishing the grounds for annulment (Art. 1392–1396). 3. Unenforceable Contracts Unenforceable contracts are agreements that cannot be enforced by action in court unless they are ratified. These are covered under Articles 1403–1408. Types of Unenforceable Contracts Contracts entered into without authority or exceeding the authority of the agent. Contracts that do not comply with the Statute of Frauds (Art. 1403). Contracts where both parties are incapable of giving consent (Art. 1403). Effects and Ratification of Unenforceable Contracts They are unenforceable in court unless ratified. Ratification makes the contract enforceable (Art. 1405). In pari delicto rule applies, meaning neither party can sue the other if both are at fault (Art. 1406). 4. Void or Inexistent Contracts Void contracts have no effect from the beginning and cannot be ratified. Articles 1409–1422 discuss void contracts. Grounds for Void Contracts A contract is void if it: Lacks an essential requisite (e.g., consent, object, or cause) (Art. 1318). Is contrary to law, morals, good customs, public order, or public policy (Art. 1409). Is simulated, meaning the parties do not intend the contract to be legally binding (Art. 1345–1346). Involves impossible or unlawful objects (Art. 1409). Is expressly prohibited or declared void by law (Art. 1409). Effects of Void Contracts A void contract produces no legal effect (Art. 1409). Parties to a void contract cannot compel performance or seek damages. If the contract involves illegal cause or object, and both parties are at fault (in pari delicto), neither party can recover what they have given under the contract (Art. 1411). Exceptions exist where public interest is involved, allowing innocent parties to recover under certain circumstances (Art. 1412). Special Rules for Void Contracts Involving Immoral Considerations Contracts involving acts against public policy or that encourage illegal activities are void. Recovery is permitted under certain exceptions, such as when public interest or the innocent party is at risk (Art. 1414–1422). Summary and Practical Implications In practice, understanding the classification of a defective contract is crucial as it affects how one may contest or enforce the contract. Key differences between these defective contracts are based on their validity, the possibility of ratification, the need for annulment or rescission, and the enforceability of obligations arising from the agreement. Obligations in General (Articles 1156 to 1162) Title I – Obligations (Book IV, Civil Code) By CHAPTER 1 General Provisions Article 1156. An obligation is a juridical necessity to give, to do or not to do. (n) Article 1157. Obligations arise from: (1) Law; (2) Contracts; (3) Quasi-contracts; (4) Acts or omissions punished by law; and (5) Quasi-delicts. (1089a) Article 1158. Obligations derived 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. (1090) Article 1159. Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith. (1091a) Article 1160. Obligations derived from quasi-contracts shall be subject to the provisions of Chapter 1, Title XVII, of this Book. (n) 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 Title, on Human Relations, and of Title XVIII of this Book, regulating damages. (1092a) Article 1162. Obligations derived from quasi-delicts shall be governed by the provisions of Chapter 2, Title XVII of this Book, and by special laws. (1093a) Assigned Readings: Civil Code Articles 1156 to 1162 Class discussions