Title RFBT NOTES (@deprechiation) ✅

OBLIGATIONS OBLIGATIONS, IN GENERAL ART 1156. An obligation is a juridical necessity to give, to do, or not to do. Kinds Natural: Ø grant a right of action Civil: give right of action Kinds as to Enforceability ▪ Prescribed but voluntarily reimburses ▪ Voluntarily performs the obligation ▪ In/testate heir voluntarily pays a debt exceeding the value of the property. Essential Active Subject / Creditor / Obligee Elements Passive Subject /Debtor / Obligor Object / Prestation Vinculum Juris / Efficient Cause / Juridical Tie (Absence of 1 element: Ø obligation) Transmissibility GR: All rights acquired in virtue of obli. are transmissible XPN: 1purely / strictly personal; 2stipulation; 3provision of law SOURCES OF OBLIGATIONS Sources Law Contracts Quasi-Contracts Delict Quasi-Delict LAW (EX LEGE) DEFN: Ø presumed; regulated by the precepts of law w/c establishes them EX: 1Duty of support; 2Duty to pay taxes CONTRACTS (EX-CONTRACTU) DEFN: have force of law between contracting parties QUASI-CONTRACTS (EX-QUASI CONTRACTU) DEFN: lawful, voluntary, and unilateral acts; give rise to juridical relation; Ø shall be unjustly enriched @ exp of another Negotiorum Gestio: GR: Voluntarily takes charge; w/o any power; obliged to cont. XPN: 1Ø neglected or abandoned; 2 tacitly authorized Solutio Indebiti: GR: received when there is Ø right to demand; unduly delivered through mistake REQ: 1who paid is Ø obliged; 2essential mistake of fact Other Examples: Funeral expenses, borne by 3rd person → reimburse the 3rd person. DELICT OR CRIME (EX-DELICTO) DEFN: Act or omission punishable by law; Governed by the Revised Penal Code Criminally liable = Civilly Liable ▪ Restitution ▪ Reparation of the damage caused ▪ Indemnification for consequential damages Proof Necessary: Criminal Liability → proof beyond reasonable doubt (sure) Civil Liability → preponderance of evidence (paramihan) Acquittal of Accused: Ø Civil Liabilty → did not do the act Civil Liability → acquittal due to reasonable doubt QUASI-DELICT DEFN: Act or omission causes damages to another; Fault or negligence → pay for damages REQ: 1act or omission; 2 fault or negligence; 3damage, 4direct relation of cause & effect Vicarious Liability: Acts done by: Responsible Minors (Live in their Company) GR: 1Father; XPN; death / incapacity of Father → 2Mother Minors & Incapacitated Person Guardian Employees (in the service) Owners & Managers Pupils & Students (in school) Teachers or Heads Employees & Household Helpers Employers Special Agent The State Defense: Persons above → observed all the diligence of a good father of a family to prevent damages. Employer → prove due diligence in selection & supervision; XPN: subsidiary liab in delict or crime Double recovery Ø allowed: ▪ Can file a case for criminal and civil liability but plaintiff Ø recover damages twice for same act or omission KINDS OF OBLIGATIONS Kinds of Civil Obligations PERFECTION AND EXTINGUISHMENT Pure Demandable at once Conditional Depend on event & condition w/ a term Period of effectivity / extinguishment is certain PLURALITY OF PRESENTATION Conjunctive All must be performed Alternative Only one must be performed Facultative Only one is demandable Debtor has the right to substitute RIGHTS & OBLI. OF MULTIPLE PARTIES Solidary (all for entire; any) Expressly so stated When the law requires When the nature of obligation requires Joint Only for respective share Disjunctive Use of “or” Not covered by the new civil code Solidarity Applies PERFORMANCE OF PRESTATION Divisible Certain # of days worked Metrical units of work Object is susceptible to partial perf. Payment in installments Indivisible Joint: Proceed against all, or act as all Solidary: Proceed against all OBLIGATIONS W/ A PENAL CLAUSE GR: Penalty shall substitute indemnity & Interest payments (Noncompliance) Debtor Ø escape fulfillment of perf by payment of penalty; XPN: Clearly granted Creditor Ø demand both at the same time; XPN: Clearly granted Performance → demanded; impossible w/o fault of debtor → penalty XPN Stipulation to the contrary Debtor refuses to pay penalty Debtor is guilty of fraud in fulfillment of obligation SUBJECT MATTER Real To Give Personal To do Not to do AFFIRMATIVENESS Positive To give To do Not to do PERSONS OBLIGED Unilateral 1 party is bound Bilateral Both parties are bound Reminders Potestative = Void Suspensive Upon the will of the debtor Constructive fulfillment When obligor voluntarily prevents fulfillment Effect of Impossible Obligation Positive Void Negative Always fulfilled Obli w/ a period Debtor pays when means permit him Condi w/ deadline GR: Extinguish the obli. REQ: Time expires; Induitable (event Ø take place) Negotiorum Gestio Solutio Indebiti

Remedies for Breach of Obligations OBLIGATION TO GIVE Determinate Thing Specific performance (physically & legally possible) Generic Thing Specific / substitute performance OBLIGATION TO DO Substitute performance only OBLIGATION NOT TO DO Have it undone at expense of debtor Rescission as a Remedy Rescission = Resolution ▪ → 1 party is not ready to perform his part Rescissible Contracts ▪ → lesion suffered by a ward or absentee Kinds of Damages (MENTAL) MORAL Mental and physical anguish EXEMPLARY Corrective or to set an example NOMINAL Vindicate a right TEMPERATE When exact amount cannot be determined ACTUAL Actual losses, requires proof LIQUIDATED Predetermined, in essence, the same as penalty Circumstances Affecting Obligations (FrieND-BF) FRAUD (Dolo) Dolo Causante Affects validity of contract; VOIDABLE May be annulled Dolo Incidente Does not affect contract Recover damages NEGLIGENCE (Culpa) Degree of care required Required by law Agreed upon by parties If NOTA, good father of a family Kinds as to Source of Liability Culpa Contractual (Contractual Negligence) Culpa Aquiliana (Civil Negligence; Quasi Delict) Culpa Criminal (Criminal Negligence) On part of supposed Creditor Immediate & proximate cause: Ø recovery for damages Contributory: May recover & courts can reduce DELAY Kinds Mora Solvendi Ex Re (Delay by debtor in real obligations) Mora Solvendi Ex Persona (Delay by debtor in Personal Obligations) Mora Accipendi (Delay by creditor) Compansatio Morae (Delay by both parties) When Considered Delay GR Upon judicial and extrajudicial demand XPN When stipulated When the law so declares Designation of time was a controlling motive When demand would be useless In reciprocal obligations, simultaneous performance but one party is Ø yet ready BREACH (Violatio) Debtors who fails in performance of obligations is bound to indemnify for losses and damages FORTUITOUS EVENT Elements Cause of unforeseen occurrence is independent of human will Impossible to foresee, or if foreseen, unavoidable Obligation becomes impossible to fulfill Debtor is free from participation in the aggravation Responsibility GR No one is responsible for unforeseen / inevitable events XPN When stipulated When nature of obligation requires assumption of risk Expressly specified by law When delay, negligence or fraud concurred w/ the event Reminders FRAUD DEFN: Insidious words or machinations → entered contract Demandable → responsibility arising from fraud Void → waiver of action for FUTURE fraud; past = valid NEGLIGENCE DEFN: omission of that diligence w/c is required by the nature of the obligation; consider circumstances, time, & place. DELAY DEFN: Incur in delay from the time the obligee judicially or extrajudicially demands from them the fulfillment of their obligation There is NO delay in obligations not to do. BREACH DEFN: any illicit act w/c impairs the strict & faithful fulfillment FORTUITOUS EVENT DEFN: Extraordinary events Ø foreseeable and Ø avoidable MODES OF EXTINGUISHMENT OF OBLIGATION ART 1231 (Pa Li Con Con CoN) Payment or Performance Loss of the thing due or Impossibility Condonation / Remission of Debt Confusion / Merger of Rights of Creditor and Debtor Compensation Novation CIVIL CODE (FRAP) Fulfillment of Resolutory Condition Rescission Annulment Prescription Payment or Performance PAYMENT BY 3 RD PERSON w/ consent of debtor w/ interest in fulfillment of obligation Compel creditor to accept payment Subrogation to rights of creditor Full reimbursement w/o consent/knowledge of the debtor Cannot compel creditor No subrogation to rights Beneficial reimbursement PERSON WHO HAS INTEREST IN THE FULFILLMENT OF OBLIGATION Guarantors Co-debtor including joint co-debtors 3 rd party mortgagors whose properties secure the obligation 3 RD PARTY DOES NOT INTEND TO BE REIMBURSED Debtor accepts Treat as donation; obli = extinguished Debtor doesn’t consent No valid donation; obli = extinguished 3 rd party seek reimbursement fr. debtor REQUIREMENT FOR PAYMENT TO BE EFFECTIVE Capacity Not minors, incapacitated Not suffering penalty or civil interdiction Rules as to the Payee PAYMENT MAY BE MADE TO Person in whose favor the obligation has been constituted His successor in interest Any person authorized to receive it 3 rd party, if redounds to benefit or creditor BENEFIT TO CREDITOR NEED NOT BE PROVEN IF After payment → 3 rd party acquires creditor’s rights Creditor ratifies the payment to the 3 rd person By creditor’s conduct → debtor led to believe 3rd party has authority 3 rd party is in possession of credit PAYMENT TO INCAPACITATED PERSONS Still valid if Incapacitated person kept the thing Insofar as it was beneficial to him Rules as to the Thing to be Paid / Delivered SPECIFIC THING Debtor Ø compel creditor to receive different one regardless of value GENERIC THING Debtor Ø deliver inferior quality, and creditor cannot demand superior quality TO DO / NOT TO DO Ø be substituted by another act or forbearance against debtor’s will Other Concepts LEGAL TENDER P1, P5, & P20 Max of P2,000 (XPN: P20 bills) Coins below P1 Max of P200 Bills No Limit NEGOTIABLE INSTRUMENTS Ø legal tender, acceptance is dependent on the creditor No effect of payment and does not extinguish obligation: ▪ Check/other mercantile docs have been encashed ▪ Its value becomes impaired EXTRAORDINARY (DE/IN)FLATION Stipulated currency will prevail PLACE OF PAYMENT OR PERFORMANCE Place designation in stipulation If no stipulation and consists determinate thing, wherever thing was located at the time of constitution Domicile of the debtor If domicile is changed in bad faith, debtor shall bear additional expense SPECIAL FORMS OF PAYMENT (DACCO) Dacion en pago Application of payments Payment by cession or assignment Tender of payment and consignation ADVANTAGES OF JUDICIAL CESSION Debts are discharged and obligations are extinguished PROPERTY EXEMPT FROM EXECUTION Generally not covered by cession except when waived Dation in Payment (Dacion en Pago) GOVERNED BY Law on Sales MAY CONSIST OF Thing; Eg. Property Rights; Eg. Credit or Usufruct NATURE There has to be delivery of thing. If promise only, constitutes Novation Prior acceptance and consequent transfer of ownership EXTENT OF EXTINGUISHMENT GR Extent of value of thing delivered as agreed upon XPN Thing is considered equivalent to entire obligation (express or implied)