Book IV: Obligations and Contracts

Title I: Obligations
Chapter I: General Provisions

4.

demandable; and
The fact, prestation or service which constitutes
the object of the obligation.

Art. 1156. An obligation is a juridical necessity to give, to

do or not to do.

*The form in which the obligation is manifested is

sometimes added as a fifth requisite.

Concept of Obligations

Classification of Obligations

Sanchez Roman. Obligation is the juridical

necessity to comply with a prestation.
Manresa. legal relation established between one
person and another, whereby the latte is bound to
the fulfilment of a prestation which the former
may demand of him
Art. 1423. Obligations are civil or natural. Civil
obligations give a right of action to compel their
performance. Natural obligations, not being based
on positive law but on equity and natural law, do
not grant a right of action to enforce their
performance, but after the voluntary fulfilment by
the obligor, they authorize the retention of what
has been delivered or rendered by reason thereof.
Some natural obligations are set forth in the
following articles.
Art. 1144. The following actions must be brought
within ten years from the time the right of action
accrues:

(1) upon a written contract;

(2) upon an obligation created by law
(3) upon a judgment

Agoncillo v. Javier. Although the debtor is no

longer bound to pay the obligation in accordance
with the statute of limitations, he is still bound to
pay in accordance with equity and natural law.

Civil and Natural Obligations, Distinguished.

Civil

Natural

Based on positive law

Based on equity or natural

law

Enforceable
justice

in

courts

1.
2.
3.
4.
5.
6.

Classifications of secondary character

1.
2.
3.
4.
5.
6.
7.

(1) As to juridical quality

1.
2.
3.

2.
3.

Natural when the obligation is in accordance

with natural law
Civil when the obligation is in accordance with
positive law
Mixed when the obligation is in accordance with
both natural and positive law.

(2) As to parties:
1.
2.

of Not enforceable in courts of

justice

Juridical or legal tie, which binds the parties to

the obligation, and which may arise from either
bilateral or unilateral acts of persons;
Active Subject, known as the creditor, who can
demand the fulfilment of the obligations
Passive Subject, known as the obligor or debtor,
against whom the obligation is juridically

legal, conventional and penal

real and personal
determinate and generic
positive and negative
unilateral and bilateral
individual and collective
accessory and principal

Classification according to Sanchez Roman

Requisites of Obligations:
1.

Pure and Conditional

With a period
Alternative and facultative
Joint and solidary
divisible and indivisible
with a penal clause

Unilateral and bilateral unilateral, where only

one party is bound, and bilateral, where both
parties are mutually or reciprocally bound.
Individual and collective individual, where there
is only one obligor, and collective, where there are
several obligors. The latter may be joint, when
each obligor is liable only for his proportionate
share of the obligation, or solidary, when each
obligor may be held liable for the entire
obligation.

(3) As to object:
1.
2.

Determinate and generic determinate, when the

object is specific; generic, when the object is
designated by its class or genus.
Simple and multiple simple, when there is only

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one undertaking; multiple, when there are several

undertakings. Multiple obligations may be
conjunctive, when all of the undertakings are
demandable at the same time, or distributive, when
only one undertaking out of several is
demandable. Distributive obligations, on the other
hand, may be alternative, when the obligor is
allowed to choose one out of several obligations
which may be due and demandable, or facultative,
when the obligor is allowed to substitute another
obligation for one which is due and demandable.
3.

4.

5.

6.

7.

Positive and Negative positive, when the obligor

is obliged to give or to do something; negative,
when the obligor must refrain from giving or
doing something.
Real and personal real, when the obligation
consists in giving something; personal, when the
obligation consists in doing or not doing
something.
Possible and impossible possible, when the
obligation is capable of fulfilment in nature as
well as in law; impossible, when the obligation is
not capable of fulfilment either in nature or in law.
Divisible and indivisible divisible, when the
obligation is susceptible of partial performance,
indivisible, when the obligation is not susceptible
of partial performance.
Principal and accessory principal, when it is the
main undertaking; accessory, when it is merely an
undertaking to guarantee the fulfilment of the
principal obligation.

5.

Art. 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.
Q: How can we determine whether an obligation arises
from law or from some other source, such as a contract,
quasi-contract, criminal offense or quasi-delict?
A: Manresa. When the law establishes the obligation and
the act or condition upon which it is based is nothing more
than a factor for determining the moment when it becomes
demandable, then the law itself is the source of the
obligation.
However, when the law merely recognizes or acknowledges
the existence of an obligation generated by an act which
may constitute a contract, quasi-contract, criminal offense
or quasi-delict and its only purpose is to regulate such
obligation, then the act itself is the source of the obligation
and not the law.

(4) As to perfection and extinguishment

1.
2.

3.

Pure when the obligation is not subject to any

condition or term and is immediately demandable.
Conditional when the obligation is subject to a
condition which may be suspensive, in which case
the happening or fulfilment of the condition results
in the birth of the obligation, or resolutory, in
which case the happening or fulfilment of the
condition results in the extinguishment of the
obligation.
With a term or period (a plazo) when the
obligation is subject to a term or period which may
be suspensive or from a day certain, in which case
the obligation terminates upon the expiration of
the term.

Art. 1157. Obligations arise from:

1.
2.
3.
4.

Law;
Contracts;
Quasi-contracts;
Acts of omissions punished by law; and

Quasi-delicts

Example of obligations arising from law:

Art. 2014. No action can be maintained by
the winner for the collection of what he has
won in a game of chance. But any loser in a
game of chance may recover his loss from the
winner, with legal interest from the time he
paid the amount lost, and subsidiarily from
the operator or manager of the gambling
house.
Family Code. Obligation of the spouses to
support each other.
Labor Code. The obligations of employers.
Art. 634. Easements imposed by law have for
their object either public use or the interest of
private persons
Art. 687. Any proprietor intending to make
any excavation contemplated in the three
preceding articles shall notify all owners of
adjacent lands.

Art. 1159. Obligations arising from contracts have the

force of law between the contracting parties and should be
complied with in good faith.
Obligations Arising from Contracts

Art. 1305. A contract is a meeting of minds

between two persons whereby one binds himself,
with respect to the other, to give something or to
render some service

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Art. 1315. Contracts are perfected by mere

consent, and from that moment the parties are
bound not only to the fulfilment of what has been
expressly stipulated but also to all the
consequences which, according to their nature,,
may be in keeping with good faith, usage and law
(consensual contracts)
Tiu Peck v. CA. Once the contract is perfected, the
valid contract has the force of law binding the
parties to comply therewith in good faith, where
neither one may renege therefrom without the
consent of the other.
Art. 1316. Real contracts, such as deposit pledge
and commodatum, are not perfected until the
delivery of the object of the obligation.
Whether the contract is consensual or real, the rule
is that from the moment it is perfected, obligations
which may be either reciprocal or unilateral arise.
Reciprocal obligations are those where the parties
are mutually or reciprocally obliged to do or to
give something; unilateral obligations are those
where only one of the parties, the obligor, is
obliged to do or to give something.
Compliance in good faith means performance in
accordance with the stipulations, clauses, terms
and conditions of the contract.
Art. 1306. The contracting parties may establish
such stipulations, clauses, terms and conditions as
they may deem convenient, provided they are not
contrary to law, morals, good customs, public
order, or public policy.
Royal Lines, Inc. v. CA. It was ruled that evasion
by a party of legitimate obligations after receiving
the benefits under the contract would constitute
unjust enrichment on his part. In default of an
agreement, Art. 1305 should be applied.

Art. 1160. Obligations derived from quasi-contracts shall

be subject to the provisions of Chapter I, Title XVII of this
Book (Extra Contractual)
Obligations arising from quasi-contracts

Art. 2142. Quasi-contracts are those juridical

relations arising from lawful, voluntary and
unilateral acts, by virtue of which the parties
become bound to each other, based on the
principle that no one shall be unjustly enriched or
benefited at the expense of another.
Art. 2144 (Negotiorum gestio). Whoever
voluntarily takes charge of the agency or
management of the business or property of
another, without any power from the latter, is
obliged to continue the same until the termination
of the affair and its incidents, or to require the

person concerned to substitute him, if the owner is

in a position to do so. This juridical relation does
not arise in either of these instances:
(1) when the property or business is not
neglected or abandoned
(2) if in fact the manager has been tacitly
authorized by the owner
In the first case, the provisions of Art. 1317, 1403,
No. 1, and 1404 regarding the unauthorized
contracts
shall govern.
In the second case, the rules on agency in Title X
this Book shall be applicable.

of

Art. 1254 (Solutio Indebiti). If something is

received when there is no right to demand it, and it
was unduly delivered through mistake, the
obligation to return it arises.

Examples of Quasi-contracts

Art. 2159. Whoever in bad faith accepts an undue

payment, shall pay legal interest if a sum of
money is involved, or shall be liable for fruits
received or which should have been received if the
thing produces fruits.
Art. 2164. When, without the knowledge of the
person obliged to give support, it is given by a
stranger, the latter shall have a right to claim the
same from the former, unless it appears that he
gave it out of piety and without intention of being
repaid.
Art. 2175. Any person who is constrained to pay
the taxes of another shall be entitled to
reimbursement from the latter.
Perez v. Palomar. It was significantly noted that in
a quasi-contract where no express consent is given
by the other party, the consent needed in a contract
is provided by law through presumption
(presumptive consent). Presumptive consent gives
rise to multiple juridical relations resulting in
obligations for delivery of the thing and rendering
of service.

Art. 1161. Civil obligations arising from offenses shall be

governed by the penal laws, subject to the provisions of
Art. 2177, and of the pertinent provisions of Chapter 2,
Preliminary Title, on Human Relations, and of Title XVIII
of this Book, regulating damages.
Obligations Arising from Criminal Offenses
GR: Art. 100. Civil liability of a person guilty of felony.
Every person criminally liable for a felony is also civilly

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liable.
Two aspects of a crime
1.
2.

Criminal aspect affects the social order and its

purpose is to punish the offender.
Civil aspect affects private rights and its purpose is
to repair the damage suffered by the aggrieved party.

Crimes without civil liability:

1.
2.
3.
4.

Treason
Rebellion
Illegal possession of firearm
Gambling

Enforcement of Civil Liability

In general and prior to the Revised Rules of Criminal
Procedure 2000, the following rules are observed in the
enforcement or prosecution of civil liability arising from
criminal offenses:
(1) Institution of criminal and civil actions. When a
criminal action is instituted, the civil action for
recovery of civil liability arising from the offense
charges is impliedly instituted with the criminal action,
unless the offended party (i) expressly waives the civil
action, or (ii) reserves his right to institute it separately,
or (iii) institutes the civil action prior to the criminal
action.
(2) Independent civil action. In the cases provided in
Art. 31, 32, 33, 34, and 2177 of the Civil Code of the
Philippines, and an independent civil action entirely
separate and distinct from the criminal action, may be
brought by the injured party during the pendency of the
criminal case, provided the right is reserved. Such civil
action shall proceed independently of the criminal
prosecution, and shall require only a preponderance of
evidence.
(3) Other civil actions arising from offenses. In all
cases not included in the preceding rules, the following
rules are observed:
(a) Criminal and civil actions arising from the same
offense may be instituted separately, but after the
criminal action has been commenced, the civil
action must cannot be instituted until final
judgment has been rendered in the criminal action;
(b) If the civil action has been filed ahead of the
criminal action, and the criminal action
is
subsequently commenced, the civil action shall be
suspended in whatever stage before final judgment
it may be found, until final judgment in criminal
action has been rendered. However, if not final
judgment has been rendered by the trial court in
the civil action, the same may be consolidated
with the criminal action upon application with the

court trying the criminal action. If the application

is granted, the evidence prevented and admitted in
the civil action shall be deemed automatically
reproduced in the criminal action, without
prejudice to the admission of additional evidence
that any party may wish to present. In case of
consolidation, both the criminal and the civil
action shall be tried and decided jointly.
(c) Extinction of the penal action does not carry with
it extinction of the civil, unless the extinction
proceeds from a declaration in a final judgment
that the fact from which the civil might arise did
not exist. In other cases, the person entitled to the
civil action may institute it in the jurisdiction and
in the manner provided by law against the person
who may be liable for restitution of the thing and
reparation or indemnity for the damage suffered.
(4) Judgment in civil action not a bar. A final judgment
rendered in a civil action absolving the defendant from
civil liability is no bar to a criminal action.
(5) Suspension by reason of prejudicial question. A
petition for suspension of the criminal action based
upon the pendency of a prejudicial question in a civil
action may be filed in the office of the fiscal
(prosecutor) or the court conducting the preliminary
investigation. When the criminal action has been filed
in court for trial, the petition to suspend shall be filed
in the same criminal action at any time before the
prosecution rests.
Elements of a prejudicial question
(1) The previously instituted civil action which
involves an issue similar or intimately related to
the issue raised in the subsequent criminal action
(2) The resolution of such issue determines whether or
not the criminal action may proceed.
Effects of Acquittal
Q: If the accused in a criminal action is acquitted if the
offense charged, can a civil action for damages based on
the same act or omission still be instituted?
A: Rule 111, Sec. 3(c). If the acquittal of the accused is
based on the ground that his guilt has not been proved
beyond reasonable doubt, a civil action to recover damages
based on the same act or omission may still be instituted. In
such case, mere preponderance of evidence shall be
sufficient in order that the plaintiff will be able to recover
from the defendant.
If the acquittal is based on the ground that he did not
commit the offense charged, or what amounts to the same
thing, if the acquittal proceeds from a declaration in a final
judgment that the fact from which the civil liability might
arise did not exist, the subsequent institution of a civil
action to recover damages is, as a general rule, no longer

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possible.
Effect of Independent Civil actions
GR: The civil action to recover damages from the person
criminally liable is not independent from the criminal
action.
Rule 111, Sec(b). The right to file a civil action shall
depend upon the result of the criminal action is instituted,
the action to recover damages shall be suspended.

plaintiffs (who are the parents of the alleged victim) failed

to make a reservation of their right to institute the civil
action separately, that such acquittal of the defendant in the
criminal case has not extinguished his liability for quasidelict. Under Art. 2176 of the Civil Code.
Art. 1162. Obligations derived from quasi-delicts shall be
governed by the provisions of Chapter 2, Title XVII of the
Book, and by special laws.
Obligations arising from Quasi-delicts

Exceptional cases where the civil action to recover

damages is entirely separate and independent from the
criminal action, although the act or omission which is the
basis thereof may be a criminal offense

1.

2.

Where the civil action is based on an obligation not

arising from the act or omission complained of as a
criminal offense or felony
Where the law grants to the injured party the right to
institute a civil action which is entirely separate and
distinct from the criminal action.

Tolentino v. Carlos. A postmaster, who has been charged

criminally for malversation of government funds under his
custody, may still be made a defendant in a civil case for
the recovery of the funds, not on the ground of
malversation, but on the ground that under Sec. 633 of the
Revised Administrative Code, he can be held accountable
thereof.
San Pedro Bus Line v. Navarro. If a passenger in a certain
bus institutes a civil action to recover damages from the
operator of the bus line for injuries sustained in an accident,
such action is separate and distinct from the criminal
prosecution of the driver for criminal negligence and may,
therefore, be continued regardless of the result of the latter.
Consequently, he casn still recover damages even if the
driver is acquitted in the criminal action, because it is clear
that the action in such case is based on culpa contractual
and not on the act or omission of the driver complained of
as felony.
Law granting institution of independent civil action
1.
2.
3.
4.
5.

Interferences by public officers or employees or by

private individuals with civil rights and liberties
Defamation
Fraud
Physical injuries
Refusal or neglect of a city or municipal polices officer
to render aid or protection in case of danger to life or
property.

Effect of Failure to make Reservation

Elcano v. Hill. The SC held, despite the fact that the

Quasi-delict may be defined as the fault or

negligence of a person, who, by his act or
omission, connected or unconnected with, but
independent from, any contractual relation, causes
damage to another person.
Equivalent to the term tort in Anglo-American
law.

Persons liable
Art. 2180. The obligation imposed by Art. 2176 is
demandable not only for ones own acts or omissions, but
also for those of persons for whom one is responsible
The father and, in case of his death or incapacity, the
mother, are responsible for the damages caused by the
minor children who live in their company.
Guardians are liable for damages caused by the minors or
incapacitated person who are under their authority and live
in their company.
The owners and managers of an establishment or enterprise
are likewise responsible for damages caused by their
employees in the service of the branches in which the latter
are employed or on the occasion of their functions.
Employers shall be liable for the damages caused by their
employees and household helpers acting within the scope
of their assigned tasks, even though the former are not
engaged in any business or industry.
The State is responsible in like manner when it acts through
a special agent; but not when the damage has been caused
by the official to whom the task done properly pertains, in
which case what is provided in Art. 2176 shall be
applicable.
Lastly, teachers or heads of establishments of arts and
trades shall be liable for damages caused by their pupils
and students or apprentices, so long as they remain in their
custody.
The responsibility treated of in this article shall cease when
the persons herein mentioned prove that they observed all
the diligence of a good father of a family to prevent

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damage.
Requisites of Liability
Taylor v. Manila Electric Co. In actions based on quasidelicts, before the person injured can recover damages from
the defendant, it is necessary that he must be able to prove
the following facts:
1.
2.
3.

The fault or negligence of the defendant

The damage suffered or incurred by the plaintiff
The relation of cause and effect between the fault or
negligence of the defendant and the damage incurred
by the plaintiff

Quasi-delicts and crimes, distinguished (Barredo v.

Garcia and Almario)
Quasi-delict
Affect private concerns
The penal code punishes or
corrects the criminal act
Includes two liabilities:
criminal and civil
Includes all acts in which
any kind of fault or
negligence intervenes
Scope of Quasi-delicts

Crime
Affect public interest
The Civil Code, by means of
indemnification,
merely
repairs the damages incurred
Includes one liability only:
civil
Not as broad because it
includes a law clearly
covering them.

Elcano v. Hill. The SC held that quasi-delicts include acts

which are criminal in character or in violation of the penal
law, whether voluntary or negligent. It is more congruent
with the spirit of law, equity and justice and more in
harmony with modern progress, to hold, as we do hold,
that Art. 2176, where it refers to fault or negligence, covers
not only acts not punishable by law but also acts criminal in
character, whether intentional or voluntary or negligent
See cases:
Barredo v. Garcia and Almario
Elcano v. Hill
Mendoza v. Arrieta

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