SECTION 2

OBLIGATIONS WITH A
PERIOD
Section 2 - Obligations with a period

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ART. 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.
 MEANING OF OBLIGATIONS WITH A
PERIOD

• Obligation with a period is one whose

effects or consequences are subjected in one
way or another to the expiration or arrival of
said period or term.
 PERIOD DEFINED –
• A period is a future and certain length of
time which determines the effectivity or the
extinguished of obligation.

• A day certain is understood to be that which

must necessarily come, although it may not
be known when.
PERIOD AND CONDITION DISTINGUISHED:

a)As to fulfillment - A period is a certain event which

must happen sooner or later while a condition is an
uncertain event.

b. As to time – a period refers only to the future while a

condition may refer to a past unknown event.
c). As to Influence on the Obligation
• A period merely fixes the time for the efficaciousness of the obligation.
 Suspensive- it cannot prevail the birth of the obligation in due time.
 Resolutory- it does not invalidate the fact that the obligation existed
 while in condition, causes an obligation either to arise or cease

As to effect, when left to debtor’s will

A period which depends upon the will of the debtor It empowers the court to fix the
duration thereof ,.

While condition which depends upon the sole will of the debtor invalidate the obligation
As to retroactivity of effects
Unless there is an agreement to the contrary, the arrival of a period does not retroactive
effect, while the in condition It has retroactive effect
 KINDS OF PERIOD

1 According to Effect

2. According to source

3.According to definiteness
•  
 ACCORDING TO EFFECT

• Suspensive (EX DIE) – the obligations begins

only from a day certain upon arrival of the period.
• Resolutory ( In diem) – the obligation is valid to a
day certain and terminates upon the arrival of the
period
 SUSPENSIVE (EX DIE)

the obligation begins only from a day certain upon the arrival of period.

• Examples:
• “I will pay you 30 days from today.”
• “I will support you from the time your father dies.”
• “I will pay you when my means permit me to do so.”
 RESOLUTORY ( IN DIEM)

The obligation is valid up to a day certain and terminates upon arrival of

the period.

Examples:
“I will give you P500 a month until the end of the year.”
“I will support you until you die.”
 ACCORDING TO SOURCE

 
• Legal period - when it is provided for by laws;

• Conventional or voluntary period - when it is agreed to by the parties

(Art. 1196);

• Judicial period - when it is fixed by the court (Art. 1197).

ACCORDING TO DEFINITENESS

 
• Definite period - when it is fixed or it is known when it will come (Art.
1193, par. 3)

• Indefinite period - When it is not fixed. Where the period is not fixed
but a period is intended, the courts are usually empowered by law to fix
the same. (Art. 1197)
 EFFECT OF LOSS, DETERIORATION, OR
IMPROVEMENT BEFORE ARRIVAL OF
PERIOD

• ART. 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. (n)
• Example:
If A is suppose to deliver to B a particular car on Dec. 19, 1999 by
the car was destroyed by fortuitous event in July 1, 1999, the
obligation is extinguished.
 EFFECT OF LOSS, DETERIORATION, OR IMPROVEMENT
BEFORE ARRIVAL OF PERIOD

• Kinds of Loss
• Loss in civil law may be:

• Physical Loss – when a thing perishes as when a house is burned and reduced to
ashes

• Legal Loss – when a thing goes out of commerce or when a thing heretofore legal
become illegal

• Civil Loss – when a thing disappears in such a way that its existence is unknown
 PAYMENT BEFORE ARRIVAL OF
PERIOD

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)

This article which is similar to Article 1188, NCC, in an obligation to give, allows the
recovery of what has been paid by mistake before the fulfillment of a suspensive condition
 DEBTOR PRESUMED AWARE OF
PERIOD

• The presumption, however, is that the debtor knew

that the debt was not yet due. He has the burden of
proving that he was unaware of the period. Where
the duration of the period depends upon the will of
the debtor, payment by him amounts, in effect, to
his determination of the arrival of the period.
 NO RECOVERY IN PERSONAL
OBLIGATIONS

Article 1195

has no application to obligations to do

or not to do because as to the former,
it is physically impossible
to recover the service rendered, and as to the latter, as the
obligor performs by not doing, he cannot, of course, recover
what he has not done
 PRESUMPTION AS TO BENEFIT OF
PERIOD
 ART. 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 or of the other. (1127)

 Presumption As to Benefit Of A Period

The general rule is that when a period is fixed by the parties , the period is
presumed to be for the benefit of both creditor and debtor.

 Which means that before the expiration of the period, the debtor may not
fulfill the obligation and neither the creditor demand its fulfillment.
PRESUMPTION AS TO BENEFIT OF
PERIOD

Example:

On January 1,D borrowed from C P10, 000

payable on December 31 without the consent
of C. Neither can C compel D to pay before
the expiration of the term.
 EXCEPTION TO GENERAL RULE
By way of exceptions, however, if the tenor of the
obligation or other circumstances may indicate that a
period is have been established for the benefit of either
the creditor or debtor:

1. TERM is for the benefit of both creditor

and debtor
2. Term is for benefit of the creditor
 TERM IS FOR THE BENEFIT OF BOTH
CREDITOR AND DEBTOR EXAMPLES

• 1. D borrowed from C P1, 000 to be paid within

one year without interest
• 2. D Promise to pay his debt “on or before
December 31,2008.”
• 3. D promised to pay his debt “for a term of 5
years counted from this date.”
 TERM IS FOR BENEFIT OF THE
CREDITOR

• D borrowed from C P1,000 payable on

December 31 with the stipulation that D
cannot make payment before the lapse of the
period but C may demand fulfillment even
before said date
 COMPUTATION OF THE TERM OR
PERIOD

• Legal Periods
• Calendar month

• Example:
• One calendar month from December 31,2010
will be from January 1,2011 to January 31,2011
 CHANGING OF PERIOD
a. Court generally without power to fix a period;

b. Exceptions to the General rule;

c. Legal effect where suspensive
period/condition depends upon will of debtor;

d. Period fixed cannot be changed by the courts

 CHANGING OF PERIOD
 ART. 1197. If the obligation does not fix a period, but from its
nature and circumstances it can be inferred that a period was
intended, the courts may fix the duration thereof.
The courts shall also fix the duration of the period when it
depends upon the will of the debtor.
In every case, the courts shall determine such period as may
under the circumstance have been probably contemplated by the
parties. Once fixed by the courts, the period cannot be changed by
them. (1128 a)
 A. COURT GENERALLY WITHOUT
POWER TO FIX A PERIOD

• IF THE OBLIGATION DOES NOT STATE A PERIOD AND NO

PERIOD IS INTENDED, THE COURT IS NOT AUTHORIZED TO
FIX A PERIOD. THE COURTS HAVE NO RIGHT TO MAKE
CONTRACTS FOR THE PARTIES.

• Example:

D obliges himself to pay C P10,000. Since the obligation does

not fix a period, not even the court may fix a period.
 B. EXCEPTIONS TO THE GENERAL
RULE

1. NO PERIOD IS FIXED BUT A PERIOD WAS INTENDE

If the obligation does not fix a period but it can be inferred from its nature and circumstances that
a period is intended.
Example:
S sold a parcel of land to B with a right of repurchase. No term is specified in the contract for
the exercise of the right. Then, the court is authorized to fix the period to repurchase.

2. Duration of the period depends upon the sole will of the debtor
THE COURT MUST FIX THE DURATION OF THE PERIOD TO FORESFALL THE
POSSIBILITY THAT THE OBLIGATION MAY NEVER BE FULFILLED. IN FIXING THE
TERM, THE COURT IS MERELY ENFORCING THE IMPLIED STIPULATION OF THE
PARTIES.
Example:
I will pay you as soon as possible. Here , the period is not fixed, so the court may fix the same
because if this is not so the obligation may never be complied with by the debtor.
 C. LEGAL EFFECT WHERE SUSPENSIVE
PERIOD/CONDITION DEPENDS UPON WILL OF
DEBTOR

• The existence of the obligation is not affected although

the period depends upon the sole will of the debtor. It is
only the performance with respect to time that is left to
the will of the debtor

• If the obligation is subject to a condition which

depends upon the sole will of the debtor, the conditional
obligation is void
 D. PERIOD FIXED CANNOT BE
CHANGED BY THE COURTS

• If there is a period agreed upon and it has already lapsed, the

court cannot fix another period

• The moment parties give their acceptance and consent to

the period fixed by the court, said period requires the nature of
a contract, because the effect of such acceptance and consent
by the parties is exactly the same as if they had expressly
agreed upon it, and having been agreed upon by them, it
becomes a law governing their contract
ART. 1198. The debtor shall lose every right to make use of the
period:
1) When after the obligation has been contracted, he becomes insolvent,
unless he gives a guaranty or security for the debt;
2) When he does not furnish to the creditor the guaranties or securities
which he has promised ;
3) 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;
4) When the debtor violates any undertaking, in consideration of which
the creditor agreed to the period;
5) When the debtor attempts to abscond. (1129a)
  
WHEN DEBTOR LOSES THE RIGHT TO MAKE USE OF A PERIOD

• The general rule is that the obligation is not demandable before the lapse
of the period. The exceptions are based on the fact that the debtor might
not be able to comply with his obligation: 
1. When debtor becomes insolvent:
The insolvency need not be judicially declared. It is sufficient that
the debtor has less assets than his liabilities or if debtor is unable to
pay his debts as they mature. It is noted that the insolvency of the
debtor must occur after the obligation has been contracted.
 WHEN DEBTOR LOSES THE RIGHT TO MAKE USE OF A
PERIOD

2. When debtor does not furnish guaranties or securities promised:

Example:
Gaya borrowed loan from Tito which loan was secured by a chattel
mortgage of Gaya’s car as a guaranty. After obtaining the loan,
Gaya fails or does not execute a chattel mortgage, the loan becomes
demandable or the debtor loses her right to make use of the period.
 
3. When guaranties or securities given have been impaired or have
disappeared .
Example:If the debt is secured by a mortgage on the houseof D but
the house was burned through his fault,the obligation also becomes
demandable unless D gives a security equality satisfactory.
 WHEN DEBTOR LOSSES THE
RIGHT TO MAKE USE OF A PERIOD
4.When debtor violates an undertaking –
Example:
Art secured a loan from Arnold on condition that Art will paint the
house of Arnold. If after the proceeds of the loan was given to Art, he
did not paint the house of Arnold, Art loses his right to make use of
the period.
5.When the debtor attempts to abscond.
Abscond means to depart or escape from creditor’s knowledge to
avoid payment of his debt. Mere attempt on the part of debtor will
entitle the creditor to demand payment of the obligation without
waiting for the period to expire.
THE END .