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DOING the best is all that matters.”
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LAW ON OBLIGATIONS

General Provisions
 Article 1156
Concept of Civil Obligation
Concept of Natural Obligation
Essential requisites of an Obligation
Kinds of Obligation

 Article 1157
Sources of obligation (law, contracts, quasi-contracts, delicts, quasi-delicts)

 Article 1160
Kinds of Quasi-Contracts and its concepts

 Article 1162
Concept of Quasi-delict
Requisites for Quasi-delict

Nature and Effect of Obligations

 Article 1163
Specific vs. Generic thing, rules in case of loss specific or generic thing due to
fortuitous event
Duties of the debtor in delivery of a specfic thing
Duties of the debtor in delivery of generic thing

 Article 1164
Right of the creditor to the fruits
When obligation to deliver fruits arises

 Article 1165
Remedies of the creditor in real obligation (obligation to give determinate or
generic thing)
Exception to the rule that obligation is extinguish if loss of the thing is due to
fortitous event

 Article 1169
Concept of delay
When does one incurs delay

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 Instances when demand is no longer necessary for the debtor to be in the
state of delay (by stipulation, law provides, nature and circumstances of the
obligation, demand is useless, reciprocal obligations)
Kinds of delay

 Article 1172
Kinds of Negligence according to source of obligation (culpa contractual,
culpa acquiliana, culpa criminal)

 Article 1173
Concept of Negligence
Diligence of a good father of the family
Kinds of Damages (actual damages, moral damages, nominal damages,
exemplary damages, temperate damages, liquidated damages)

 Article 1174
Concept of fortuitous event

 Article 1176
Presumptions in the receipt of principal and installment
Two kinds of presumption

Different Kins of Obligations

Pure and Conditional Obligations
 Article 1179
Concept of Pure Obligation, its demandability
Two principal kinds of condition (suspensive and resolutory), its distinctions

 Article 1180
When debtor binds himself to pay when his means permi him to do so, the
obligation is deemed to be one with a period

 Article 1182
Effect on the obligation if the suspensive condition depends upon the will of
the debtor - VOID
Effect on the obligation if the resolutory condition depends upon the will of
the debtor - VALID
Effect on the obligation if the suspensive or resolutory condition depends
upon the will of the creditor - VALID

 Article 1183
Effects of impossible conditions in Obligations

 Article 1184

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 Positive condition, happening of an event at a determinate time extinguishes
the obligation.

 Article 1187
Rules on the fruits and interest during the pendency of the condition

 Article 1189
Rules in cases of loss, deterioration, or improvement of the thing , with and
without debtor’s fault, when the obligation is subject to suspensive condition
Concept of loss

Obligations with a Period

 Article 1193
Period vs. Condition

 Article 1198
When the debtor lose his right to make use of the period

Alternative Obligations
 Article 1199
Concept of Alternative Obligation

 Article 1200
The right of choice in alternative obligation

 Article 1204
Rules in case of loss of the thing due in alternative obligation when the right
to choose is given to the debtor

 Article 1205
Rules in case of loss of the thing due in alternative obligation when the right
to choose is given to the creditor

Joint and Solidary Obligations

 Articles 1207 and 1208
Concept of Joint and Solidary obligations
Presumption that the obligation is joint in the absence of stipulation of its
nature
Instances where the obligation is considered solidary
Review how to properly distribute the shares among debtors and creditors in
joint and solidary obligation

 Article 1210
Indivisibility of an obligation does not give rise to solidarity.

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 Article 1215 in relation to Article 1219
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

 Article 1216
Creditors may proceed against any one of the solidary debtors or some or all
of them simultaneously.

Divisible and Indivisible Obligations

 Article 1223
Concept of divisible and indivisible obligation

Obligations with a Penal Clause

 Article 1226 and 1227
Concept of Obligations with Penal Clause
Instances when creditor may recover damages and interest in addition to the
penalty

 Article 1228
Proof of actual damages not necessary for creditor to demand the penalty

 Article 1230
Nullity of a penal clause

Extinguishment of Obligations
General Provisions
 Article 1231
Extinguishment of Obligations

Payment or Performance
 Articles 1236 and 1237
Effects of payment by a third person with knowledge of the debtor, without
knowledge of the debtor, or against the will of the debtor, including their
rights after payment

 Article 1239
Payment made by one who does not have free disposal of the thing due to
incapacity

 Article 1241

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 Payment to an incapacitated person and third person

 Article 1243
Payment made by the debtor after being judicially ordered to retain the debt

 Article 1245
Concept of Dation in Payment (Dacion en Pago) and the Four special forms of
Payment

 Article 1249
Concept of Legal Tender
Rules on Payment by means of instruments of credits
What constitutes legal tender in the Philippines

Application of Payments
 Article 1252
Requisites of Application of payments
Application as to debts not yet due
Rules on Application of Payments

 Article 1253
Payment must be applied to the interest first before the principal

 Article 1254
Application of payment in onerous debts

Payment by Cession
 Article 1255
Concept of Payment by Cession
Requisites of Payment by Cession
Dation in Payment vs. Cession

Tender of Payment and Consignation

 Article 1256
Concept of Tender of Payment and Consignation

 Article 1259
Expense of consignation shall be charged against creditor

 Article 1260
Effects if debtor withdraws his consignment before the creditor accepted the
consignation or before there is judicial declaration that consigation was
properly made

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 Loss of the Thing Due
 Article 1262
Loss of determinate things

 Article 1263
Loss of generic things

Condonation or Remission of the Debt

 Article 1270
Concept of Condonation or Remission
Requisites of Condonation or Remission

 Article 1271
Implication on the delivery of the private document evidencing credit by the
creditor to the debtor

 Article 1273
Renunciation of principal debt extinguishes the acessory obligation

 Article 1274
Presumption that the accessory obligatio of pledge is remitted when the
thing pledge is found in the possesion of the debtor

Confusion or Merger of Rights

 Article 1275
Concept of Meger and Confusion

 Article 1276
Merger in the principal debtor or creditor benefits the guarantors
Effects of confusion or merger in the person of the guarantor

Compensation
 Article 1278
Concept of Compensation
Kinds of Compensation (as to effect: total and partial; as to cause or origin:
Legal, Voluntary, Judicial, Facultative)

 Article 1279
Requisites of Legal Compensation

 Article 1280

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 Guarantor may set up compensation as regards what the creditor may owe
the principal debtor

 Article 1285
Rules when creditor assigns his credit to third person

 Article 1289
Rules if a person should have against him several debts susceptible of
compensation

Novation
 Article 1291
Modifications in the obligation that constitutes novation

 Article 1292
Requisites of Novation
Extension of payment and the addition of another obligation is not
incompatible with the old one and is not novation thereof

 Article 1293
Kinds of Substitution (Expromision, Delegacion)

 Article 1294 and 1295

Effects on the insolvency of the new debtor in the original debtor in cases of
novation

 Article 1296
When principal obligation is extinguished by novation, accessory obligation
subsist ony insofar as they may have benefit third person who did not give
their consent

 Article 1297
Rule if the new obligation by novation is void

 Article 1298
Rule if the original obligation is void (novation)

 Article 1299
If the original obligation was subject to a suspensive or resolutory condition,
the new obligation shall be under the same condition, unless otherwise
stipulated

LAW ON CONTRACTS

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 General Provisions
 Article 1305
Concept of contracts

 Article 1307
Kinds of Innominate contract

 Article 1309
Determination of the performance may be left to a third person which binds
the parties from the time it has been made known to them

 Article 1311
Principle of Relativity
Transmissiblility of the rights and obligations derived from a contract to the
party’s heirs and assignees; Exceptions
Stipulation Pour Atrui

 Article 1315
Consesuality of contracts

 Article 1316
Concept of Real contracts

Essential Requisites of Contracts

General Provisions
 Article 1318
Essential requisites of a contract

Consent
 Article 1319
Concept of Consent

 Article 1327
Persons who cannot give consent to a contract

 Article 1328
Contracts entered under lucid interval and in the state if drunkenness

 Article 1330
Contracts where consent is given through mistake, violence, intimidation,
undue influence, or fraud is voidable

 Article 1334
Mutual error as to the legal effect of the agreement vitiates consent

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 Article 1338
Concept of Fraud

 Article 1344
Fraud that makes a contract voidable
Concept of incidental Fraud

Object of Contracts
 Article 1347 and 1348
What are the proper objects of a contract
Requisites of things as object of contract
Requisites of services as obkect of contract

Cause of Contracts
 Article 1350
Cause of Contracts

 Article 1354
Presumption of lawful cause

Forms of Contracts
 Article 1356
Classification of contracts according to form
Form for validity of contracts

Reformation of Instruments
 Article 1359
Concept of reformation of contract

Rescissible Contracts
 Article 1381
Types of Rescissible contracts

 Article 1383
Subsidiary nature of Rescission

 Article 1385
When can Rescission not take place

 Article 1389

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 Prescriptive period for the action of Rescission

Voidable Contracts
 Article 1390
Types of Voidalble Contracts

 Article 1391
Prescriptive preiod for the action of Annulment

 Article 1392
Voidable contracts may be ratified

 Article 1397
Persons who can file an action for annulment
Persons who cannot allege the incapacity of those with whom they
contracted
Persons who cannot allege the presence of vices of consent

Unenforceable Contracts
 Article 1403
Kinds of unenforceable contracts
Statute of Frauds

 Article 1405
Unenforceable contracts can be ratified

 Article 1408
Unenforceable contracts cannot be assailed by third persons

Void and Inexistent Contracts

 Article 1409
Types of void contracts

 Article 1410
Imprescriptibility of void contracts

 Article 1420
Illegal terms can be separated from legal ones if the contract is divisible

 Article 1421
Defense of illegality of contract is not available to third person whose
interest are not directly affected.

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