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There is no contract unless the following requisites concur: (1) Consent of the contracting parties; (2) Object certain which is the subject matter of the contract; (3) Cause of the obligation which is established. Real contracts require a fourth requisite - delivery Solemn or formal contracts require a fourth requisite - compliance with the formalities required by law Consent presupposes legal capacity and the fulfillment of conditions should any be attached Effects of non consent -
If there is no consent, there is no contract, the agreement may be considered inexistent or
nonexistent or void (i.e. joke, absolutely simulated contract, one where the parties never intended to be bound) If there is vice of consent (vitiated consent) such as error, fraud, or undue influence, the contract is not void, it is merely voidable. Lack of consent is separate and distinct from lack of consideration
SECTION 1 - CONSENT Article 1319. Consent is manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract. The offer must be certain and the acceptance absolute. A qualified acceptance constitutes a counter offer. Acceptance made by letter or telegram does not bind the offerer except from the time it came to his knowledge. The contract, in such a case, is presumed to have been entered into in the place where the offer was made. CONSENT a) The meeting of the minds between the parties on the subject matter and the cause of the contract, even if neither one has been delivered b) The manifestation of the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract Requisites of consent (a) there must be two or more parties (b) the parties must be capable or capacitated (c) there must be no vitiation of consent (d) there must be no conflict between what was expressly declared and what was really intended (e) the intent must be declared properly Requisites for the meeting of the minds (a) an offer that must be certain (b) and an acceptance that must be unqualified and absolute Article 1320. An acceptance may be express or implied. (1) Forms of acceptance (a) express [Art 1320 Civil Code] (b) implied [Art 1321 Civil Code] (c) presumed by law as when there is failure to repudiate hereditary rights with the period fixed by law
Article 1321. The person making the offer may fix the time, place, and manner of acceptance, all of which
CIVIL CODE IV PRESCRIPTION, OBLIGATIONS & CONTRACTS
DVOREF Exam Review Notes Chapter 2 Arts 1318 - 1355
Justice Edgardo L Paras All Rights Reserved
Maria Adeliza M Diego SY 2013
and the advertiser is not bound to accept the highest or lowest bidder. Unless it appears otherwise. (1) Acceptance of an offer made thru an agent (a) applies when both the offer and the acceptance are made thru an agent (b) any other intermediary who is not an agent with power to bind. or by parental or judicial authority PARENS PATRIAE . The following cannot give consent to a contract: (1) Unemancipated minors (2) Insane or demented persons. (1) Things that may be fixed by the offeror (a) the time (b) the place (c) the manner of acceptance Article 1322. Article 1326. attainment of the age of majority. An offer becomes ineffective upon the death. Article 1327. intimidation and undue influence) [Art 1330-1334 Civil Code] Unemancipated minors (a) those who have not been unemancipated by marriage. as something paid or promised. but mere invitations to make an offer. is merely a sort of messenger. fraud.inherent in the supreme power of the state (b) contracts that are voidable unless CIVIL CODE IV PRESCRIPTION. Advertisements for bidders are simply invitations to make proposals. When the offerer has allowed the offeree a certain period to accept.must have its own cause and consideration. An offer made through an agent is accepted from the time acceptance is communicated to him. insanity. unless the contrary appears. the subject matter has become illegal or impossible (d) when the period of time given to the offeree within which he must siginify his acceptance has already lapsed (e) when the offer is revoked in due time (before the offeror has learned of its acceptance by the offeree) Article 1324. civil interdiction. Voidable contracts (a) those where one party is incapacitated to give consent [Art 1327 Civil Code] (b) those where the consent of one party has been vitiated (such as by error.must be complied with. except when the option is founded upon a consideration.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 . a contract granting a person the privilege to buy or not to buy certain objects at any time with the agreed period at a fixed price. the offer may be withdrawn at any time before acceptance by communicating such withdrawal. the contract of option is a separate and distinct contract from the contract which the parties may enter into upon the consummation of the contract Article 1325. or insolvency of either party before acceptance is conveyed. violence. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 . OPTION . and deaf-mutes who do not know how to write. who must communicate to the person who sends him Article 1323. Other instances when the offer becomes ineffective (a) when the offeree expressly or impliedly rejects the offer (b) when the offer is accepted with a qualification or condition (counter offer) (c) when before acceptance is communicated. business advertisements of things for sale are not definite offers.
children. weak mind. undue influence. and other similar causes. Mistake as to the identity or qualifications of one of the parties will vitiate consent only when such identity or qualifications have been the principal cause of the contract. A contract where consent is given through mistake. sisters. Article 1329.violence. (1) Mistake or error . The incapacity declared in article 1327 is subject to the modifications determined by law. disease. spouse. in estoppel (c) persons specially disqualified (VOID) 1) husband and wife cannot sell or donate to each other 2) insolvents before they are discharged cannot make payments 3) persons disqualified because of fiduciary relationship 4) contracts entered into with non christians (muslims) Article 1328. it should refer to the substance of the thing which is the object of the contract.mere preponderance of evidence is not sufficient Article 1331. intimidation. and provided further. (1) Causes of vitiated consent (a) mistake (or error) (b) fraud (or deceit) (c) violence (d) intimidation (e) undue influence INTELLECT . take care of themselves and manage their property Article 1330. unless annulled by a proper action in court. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 . violence. brothers. or fraud is voidable. that the minor is 18yo and above 4) they were in the form of savings account. In order that mistake may invalidate consent. Contracts agreed to in a state of drunkenness or during a hypnotic spell are voidable.a false belief about something (2) Requisites for mistake to vitiate consent (a) error must be substantial CIVIL CODE IV PRESCRIPTION. or to those conditions which have principally moved one or both parties to enter into the contract. susceptible of ratification before annulment [Art 1390 Civil Code] (3) Clear and convincing evidence on the vice of consent . the people who are legally bound to give them support should pay therefor 6) where the minor misrepresented his age and pretended to be one of major age and is thus. and the court having jurisdiction had approved the same 3) they were contracts of life insurance in favor of their parents. A simple mistake of account shall give rise to its correction.mistake and fraud VOLITION .1) upon reaching the age of the majority. they ratify the same 2) they were entered thru a guardian. provided further that the minor is at least 7yo 5) they were contracts for necessities such as food. Contracts entered into during a lucid interval are valid. intimidation and undue influence (2) Nature of a viodable contract .binding and valid.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 . Incompetents under the Rules of Court (maybe be placed under guardianship) (a) those under civil interdiction (b) hospitalized lepers (c) prodigals (d) deaf and dumb who are unable to read and write (e) those of unsound mind even though they have lucid intervals (f) those who by reason of age. cannot without outside aid. and is understood to be without prejudice to special disqualifications established in the laws.
(1) Requisites (a) there must be mutual error (b) the error must refer to the legal effect of the agreement (c) the real purpose of the parties is frustrated (2) Ignorantia legis neminem excusat (3) Distinguished from remedy of reformation Under Art 1361 the real agreement is not disclosed. or upon the person or property of his spouse. serious or irresistible force is employed. When one of the parties is unable to read. in Art 1334 the error is as to the legal effect of the agreement Article 1335. contingency or risk affecting the object of the contract. aleatory in nature) (2) Mistake caused by inexcusable negligence cannot be annulled Article 1334. A threat to enforce one's claim through competent authority. may vitiate consent. sex and condition of the person shall be borne in mind. if the claim is just or legal. (1) Presumption The natural presumption is that one always acts with due care and signs with full knowledge of all the contents of a document. to give his consent. intimidation and moral coercion (2) Requisites for violence to vitiate consent (a) employment of serious or irresistible force (b) it must have been the reason why the contract was entered into (3) Requisites for intimidation to vitiate consent - CIVIL CODE IV PRESCRIPTION. Mutual error as to the legal effect of an agreement when the real purpose of the parties is frustrated. (1) Violence refers to physical coercion.if because of it the party gave his consent Article 1332. (1) Knowledge of doubt or risk does not vitiate consent (ex. the age. descendants or ascendants. (2) When presumption does not apply (a) when one of the parties is unable to read including a blind person (b) or if the contract is in a language not understood by one of the parties Article 1333. and mistake or fraud is alleged. the person enforcing the contract must show that the terms thereof have been fully explained to the former. There is intimidation when one of the contracting parties is compelled by a reasonable and well-grounded fear of an imminent and grave evil upon his person or property. only if such was the principal cause of the contract (b) error must be excusable (not caused by negligence) (c) error must be a mistake of fact and not of law (3) Substantial error . There is violence when in order to wrest consent.1) the object of the contract 2) the conditions which principally moved or induced one of the parties 3) identity or qualifications.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 . does not vitiate consent. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 . There is no mistake if the party alleging it knew the doubt. To determine the degree of intimidation. or if the contract is in a language not understood by him.
through insidious words or machinations of one of the contracting parties. or was ignorant or in financial distress. family. if the claim is just or legal.voidable 2) DOLO INCIDENTE . when there is a duty to reveal them. There is fraud when. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 . an actionable wrong. descendants. as when the parties are bound by confidential relations. CIVIL CODE IV PRESCRIPTION. (1) Requisites for undue influence to vitiate consent (a) improper advantage (b) power over the will of another (c) deprivation of the latter's will of a reasonable freedom of choice (2) Examples of circumstances to be considered (a) confidential. There is undue influence when a person takes improper advantage of his power over the will of another. (1) Violence or intimidation caused by third person vitiates consent Article 1337. depriving the latter of a reasonable freedom of choice. misrepresentation in good faith is not fraud (d) the other party must have relied on the untrue statement and must himself not be guilty of negligence in ascertaining the truth Article 1339.valid but there can be action for damages (b) fraud in the performance of the obligations stipulated in the contract (existence of perfected contract) (2) Requisites of DOLO CAUSANTE (a) the fraud must be material and serious and really induced the consent [Art 1344 Civil Code] (b) the fraud must have been employed by only one of the contracting parties. The following circumstances shall be considered: the confidential. does not vitiate consent A threat to prosecute is not considered as intimidation Article 1336. the contract would remain valid (c) there must be deliberate intent to deceive or to induce. Failure to disclose facts. (1) Kinds of fraud (a) fraud in the celebration of the contract (fraud proper) 1) DOLO CAUSANTE . family. constitutes fraud. spiritual and other relations between the parties (b) mental weakness (c) ignorance (d) financial distress (3) Contracts of adhesion Contracts where one party merely signs carefully prepared contracts by big companies should be strictly interpreted against the company and liberallly in favor of the individual Article 1338. spiritual and other relations between the parties.(a) reasonable and well grounded fear (b) of an imminent and grave evil (c) upon his person. although it may have been employed by a third person who did not take part in the contract.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 . property or upon the person or property of his spouse. he would not have agreed to. because if both committed fraud. or ascendants (d) it must have been the reason why the contract was entered into (e) the threat must be of an unjust act. the other is induced to enter into a contract which. or the fact that the person alleged to have been unduly influenced was suffering from mental weakness. without them. Violence or intimidation shall annul the obligation. A threat to enforce one's claim through competent authority.
when it does not prejudice a third person and is not intended for any purpose contrary to law. Simulation of a contract may be absolute or relative. CAVEAT EMPTOR .the opinion of an expert is almost in the same category as a fact. when the parties conceal their true agreement. Article 1342.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 . Fraud by a third person does not make the contract voidable unless a) the representation has created substantial mistake b) the mistake is mutual (contract may be annulled on ground of error or mistake) Article 1343.usual exaggerations in trade.failure to disclose facts CONFIDENTIAL RELATIONS .the process of intentionally deceiving others by producing the appearance of a contract that really does not exist (absolute simulation) or which is different from the true agreement (relative simulation) Requisites for simulation a) an outward declaration of will different from the will of the parties b) the false appearance must have been intended by mutual agreement c) the purpose is to deceive third persons Article 1346. A relative simulation.absolutely simulated fictitious contracts 1) the parties do not intend to be bound 2) effect . unless made by an expert and the other party has relied on the former's special knowledge. An absolutely simulated or fictitious contract is void. The former takes place when the parties do not intend to be bound at all. In order that fraud may make a contract voidable.the parties are bound to the real or true agreement. Requisites for fraud to vitiate consent (grounds for annulment) a) the fraud must be serious b) the parties must not be in pari delicto (mutual guilt) Incidental fraud is not causal fraud Article 1345.relatively simulated disguised contracts 1) the parties conceal their true agreement 2) effect . are not in themselves fraudulent. good customs. Article 1344. Incidental fraud only obliges the person employing it to pay damages. morals. as in the case of partners Article 1340. when the other party had an opportunity to know the facts.when parties are bound. The usual exaggerations in trade. Force or intimidation by a third person makes the contract voidable.let the buyer beware TOLERATED FRAUD . the latter. A mere expression of an opinion does not signify fraud.CONCEALMENT . SIMULATION OF A CONTRACT . dealer's talk Article 1341. RULE ON EXPERT OPINION . Misrepresentation made in good faith is not fraudulent but may constitute error.contract is void DISIMULADOS . public order or public policy binds the parties to their real agreement. it should be serious and should not have been employed by both contracting parties. unless such misrepresentation has created substantial mistake and the same is mutual. particularly when this expert's knowledge is relied upon by the other party. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 . Misrepresentation by a third person does not vitiate consent. SIMULADOS . except CIVIL CODE IV PRESCRIPTION.
the prestation or promise of a thing or service by the other. The particular motives of the parties in entering into a contract are different from the cause thereof. morals.a) if the contract should prejudice a third person b) if the purpose is contrary to law. the service or benefit which is remunerated. good customs. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 . the contract is void for want of an essential requisite . CIVIL CODE IV PRESCRIPTION. public order or public policy. public order. good customs. for each contracting party. or with unlawful cause.the essential and impelling reason why a party assumes an obligation In reciprocal contracts.CAUSE OF CONTRACTS Article 1350. good customs. and vice versa Classification of contracts as to cause a) ONEROUS . Motive distinguished from cause a) the motive of a person may vary although he enters into the same kind of contract. the cause is always known c) the presence of motive cannot cure the absence of cause Article 1352. or public policy d) must not be impossible e) must be determinate as to its kind or determinable without the need of a new contract or agreement Article 1348. Impossible things or services cannot be the object of contracts. the cause is always the same b) the motive may be unknown to the other.the particular debtor cannot comply) Impossibility must not be confused with difficulty Article 1349. the subject matter for one is the cause for the other. the prestation or promise of a thing or service by the other b) REMUNERATORY . good customs.contracts of pure beneficence. All services which are not contrary to law. morals. morals. the cause is the mere liability of the benefactor Article 1351. The fact that the quantity is not determinate shall not be an obstacle to the existence of the contract.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 .the past service or benefit which by itself is a recoverable debt c) GRATUITOUS .the object of the contract SECTION 3 . may be the object of a contract.for each contracting party. Requisites a) the thing or service must be within the commerce of man b) must be transmissible c) must not be contrary to law. produce no effect whatever. The object of every contract must be determinate as to its kind. No contract may be entered into upon future inheritance except in cases expressly authorized by law. morals. including future things.OBJECT OF CONTRACTS Article 1347.no one can do it) c) relative (subjectively impossible . The cause is unlawful if it is contrary to law. public order or public policy may likewise be the object of a contract. the mere liberality of the benefactor. provided it is possible to determine the same. In onerous contracts the cause is understood to be. All rights which are not intransmissible may also be the object of contracts. Impossibility may be a) because of the nature of the transaction or because of the law b) absolute (objectively impossible . CAUSE . and in contracts of pure beneficence. If the object is not determinate or determinable. without the need of a new contract between the parties. in remuneratory ones. All things which are not outside the commerce of men. Contracts without cause. public order or public policy SECTION 2 .
unless the debtor proves the contrary. neither can sue the other Article 1353. LESION . mistake or undue influence CIVIL CODE IV PRESCRIPTION. and he may recover what he has already given b) if both parties are guilty. it is presumed that it exists and is lawful.inadequacy of cause. if it should not be proved that they were founded upon another cause which is true and lawful. Article 1355. but merely revocable or voidable Article 1354. unless there has been fraud. The statement of a false cause in contracts shall render them void. Except in cases specified by law.1355 Justice Edgardo L Paras All Rights Reserved Maria Adeliza M Diego SY 2013 .generally does not invalidate a contract. like an insufficient price for a thing sold Rules on lesion . except a) when together with lesion there has been 1) fraud 2)mistake 3) or undue influence b) in cases expressly provided by law Lesion may be evidence of the presence of fraud. Although the cause is not stated in the contract. OBLIGATIONS & CONTRACTS DVOREF Exam Review Notes Chapter 2 Arts 1318 .Requisites for cause a) it must be present (at the time the contract was entered into) b) it must be true c) it must be lawful Effect if the cause is illegal a) if one party is innocent he cannot be compelled to perform his obligation. mistake or undue influence. in general. Just because the cause stated is false does not necessarily mean that the contract is void The contract with a statement of a false cause is not void. lesion or inadequacy of cause shall not invalidate a contract.
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