O B L I G AT I O N S AN D C O N T R AC T S From the moment one of the parties fulfills his

obligation, delay by the other begins.

ESSENTIAL REQUISITES OF AN OBLIGATION
- Passive subject CULPA CONTRACTUAL CULPA AQUILIANA
- Active subject Pre-existing contractual None
- Juridical Tie relation
- Object/Prestation Breach of contract Negligent act/omission itself
Proof of contract and its Negligence must be proved
SOURCES OF OBLIGATIONS breach is sufficient to
- Law warrant recovery
- Contracts Proof of due diligence in the AVAILABLE
- Quasi-contracts selection and supervision of
- Acts and omissions punishable by law employees is NOT
- Quasi-delicts AVAILABLE

TO GIVE: RIGHTS OF CREDITOR FORTUITOUS EVENTS

Determinate: GR: No person shall be responsible for those events which
- to compel specific performance could not be foreseen, or which though foreseen, were
- recover damages in case of breach of obligation inevitable
Generic: XPN: (still civilly liable)
- to ask for performance of obligation - Expressly specified by law
- to ask that the obligation be complied with at the - Declared by stipulation
expense of the debtor - Nature of the obligation requires the assumption of
- to recover damages in case of breach of obligation risk (Art. 1174, NCC)
- Object of the obligation is lost and the loss is due to
TO GIVE: DUTIES OF DEBTOR the fault of the debtor
Determinate: - Object of the obligation is lost and the loss occurs
- to deliver the thing after the debtor has incurred in delay
- to take care of the thing with DOAFGOAF - When the debtor promised to deliver the same thing
- to deliver all accessions and accessories to two or more persons who do not have the same
- to pay damages in case of breach of obligation interest
Generic: - When the obligation to deliver arises from a criminal
- to deliver a thing neither superior/inferior quality offense
- to pay damages in case of breach of obligation - When the obligation is generic
LOSS DUE TO FORTUITOUS EVENT EXEMPTION FROM LIABILITY: FORTUITOUS EVENTS
Determinate: debtor cannot be held liable for damages 1. The cause of the breach of the obligation must be
Generic: debtor can be held liable for damage (genus INDEPENDENT OF THE WILL of the debtor
nunquam perit) 2. The event must be UNFORESEEABLE OR
UNAVOIDABLE
DAMAGES: 3. The event must be such as to render it IMPOSSIBLE
- Delay (mora) – non-fulfillment of an obligation with for the debtor to fulfill his obligation in a NORMAL
respect to time MANNER
o Mora Solvendi: delay of the debtor to 4. The debtor must be FREE FROM PARTICIPATION
perform OR AGGRAVATION
o Mora Accipiendi: delay of the creditor to
accept REMEDIES AVAILABLE TO CREDITOR
o Compensatio Morae: delay of the parties in - To exhaust the property in possession of the debtor
reciprocal obligations - To be subrogated to all of the rights and actions of the
- Fraud (dolo) – conscious and intentional proposition debtor (accion subrogatoria)
to evade the normal fulfillment of an obligation - To impugn all of the acts which the debtor may have
- Negligence (culpa) – omission of that diligence done to defraud him (accion pauliana)
required by the nature of the obligation and
corresponds with the circumstances of the persons, DIFFERENT CLASSES OF OBLIGATIONS
time, and place 1. Pure, conditional, and with a term or period
- Contravention of the tenor of the obligation 2. Alternative and facultative
(cototo) 3. Joint and solidary
4. Divisible and indivisible
DEMAND NOT NECESSARY 5. With and without a penal clause
- Obligation or law expressly declares
- Time is of the essence REQUISITES OF CONDITION
- Demand is useless, as when the obligor has rendered - Futurity
it beyond his power to perform - Uncertainty
DELAY IN RECIPROCAL OBLIGATIONS SUSPENSIVE CONDITION RESOLUTORY
- In reciprocal obligations, neither party incurs in delay CONDITION
if the other does not comply or is not ready to comply When fulfilled, the obligation When fulfilled, the obligation
in a proper manner with what is incumbent upon him. arises or becomes effective is extinguished
 Not fulfilled, no juridical Not fulfilled, juridical relation 3. When by his own acts he has impaired said
relation is consolidated guaranties or securities after their establishment, and
Rights are not yet acquired, Rights are already acquired, when through a fortuitous event they disappear,
but there is a hope or but subject to the threat of unless he immediately gives new ones equally
expectancy that they will extinction satisfactory
soon be acquired 4. When the debtor violates any undertaking in
consideration of which the creditor agreed to the
RECIPROCAL OBLIGATIONS period
- Created and established at the same time 5. When the debtor attempts to abscond
- Out of the same cause
- Result in mutual relationships of creditor and debtor RIGHT TO CHOOSE IN ALTERNATIVE OBLIGATIONS
between the parties GR: DEBTOR
XPN:
TACIT RESOLUTORY CONDITION - When the right has been expressly granted to the
- When one of the debtors should not comply with what creditor
is incumbent upon him - Or to a third person
- Fulfillment + damages WHEN BOUND BY CHOICE?
- Rescission + damages - Upon communication
- Right to rescind is implied only if not expressly
granted WHEN IS AN OBLIGATION SOLIDARY
- Injured party must invoke judicial aid GR: Joint
- SUBSTANTIAL BREACH, not slight or casual breach XPN:
- Both parties breached? First one. Cannot be - Obligation expressly states
determined? Extinguished, to each his own. - Law
- Nature permits it to be solidary
REQUISITES OF A TERM/PERIOD
- Futurity HOW TO DISTINGUISH JOINT INDIVISIBLE FROM JOINT
- Certainty DIVISIBLE OBLIGATION?
1) If there are two or more debtors, compliance with the
CONDITION TERM/PERIOD obligation requires the concurrence of all of them,
Event Interval of time although each for his own share. Consequently, the
Futurity, uncertainty Futurity, certainty obligation can be enforced only by proceeding against
May or may not happen Will surely come to pass all of the debtors.
Exerts influence upon the Exerts influence upon its 2) If there are two or more creditors, the concurrence of
very existence of the demandability all of them, although each for his own share, is also
obligation itself necessary for the enforcement of the obligation. This
Has retroactive effects Does not have, unless there is because the obligation is joint, and therefore, a
is an agreement creditor cannot act in representation of the others, and
it is also indivisible, and therefore, not susceptible of
Left exclusively to the will of Left exclusively to the will of
partial fulfillment.
the debtor, the validity of the debtor, the obligation is
obligation is affected still valid
DEFENSES AVAILABLE TO A SOLIDARY DEBTOR IF THE
CREDITOR PROCEEDS AGAINST HIM ALONE FOR THE
Suspensive – when the obligation becomes demandable only
PAYMENT OF ENTIRE OBLIGATION
upon the arrival of a day certain
1) Defenses derived from the nature of the obligation
Resolutory – demandable at once, although it is terminated
(payment or performance, prescription, violence,
upon the arrival of a day certain
intimidation, fraud, undue influence, mistake)
2) Defenses personal to him or pertaining to his own
IN OBLIGATIONS WITH A TERM OR PERIOD, TO WHOSE
share (minority, insanity)
BENEFIT IS IT?
3) Defenses personal to the others, but only as regards
- Both creditor and debtor
that part of the debt for which the latter are
responsible (merely a partial defense)
INSTANCES WHERE THE COURTS CAN FIX A
TERM/PERIOD
PENAL CLAUSE: PURPOSES
1. If the obligation does not fix a period but from its
1) To insure performance
nature and circumstances, it can be inferred that a
2) To liquidate amount of damages
period was intended by the parties
3) To punish debtor
2. If the duration of the period depends upon the will of
the debtor
EXCEPTIONS TO THE RULE THAT PENALTY SHALL
3. If the debtor binds himself to pay when his means
SUBSTITUTE INDEMNITY FOR DAMAGES + INTERESTS
permit him to do so
1) Stipulation
2) Debtor is sued for refusal to pay the agreed penalty
INSTANCES WHERE THE DEBTOR SHALL LOSE EVERY
3) Debtor is guilty of fraud
RIGHT TO MAKE USE OF THE TERM/PERIOD
1. When after the obligation has been contracted, he
WHEN COURTS MAY REDUCE THE PENALTY ATTACHED
becomes insolvent, unless he gives a
TO OBLIGATION
guaranty/security for debt
1) If the principal obligation has been partly complied
2. When he does not furnish to the creditor the
with
guaranties or securities he has promised
2) Or irregularly complied with
 3) Penalty is iniquitous or unconscionable even if there
has been no performance

WHEN COURTS CAN DELETE PENAL CLAUSE

1) Substantial performance in good faith
2) Fatal infirmity
3) Exceptional circumstances

3RD PERSON PAYS AN OBLIGATION

WITH KNOWLEDGE AND CONSENT OF DEBTOR:
1. Recover from the debtor the entire amount he has
paid
2. Subrogated to all the rights of the creditor
WITHOUT KNOWLEDGE AND CONSENT:
1. Recover only insofar as the payment has been
beneficial to said debtor

TO WHOM MUST PAYMENT BE MADE

1. The person in whose favor the obligation has been
constituted
2. Successor in interest
3. Any person authorized to receive it

OTHER INSTANCES