Assignment In LW 111

LAW IN OBLIGATION AND CONTRACT

Lorei Jean A. Sagadraca. DHRMT !1 A"g"st # $1%

Mam. Ma&o Instr"ctor

CHA'T(R 1 STUDY GUIDE

I. De)initions 1.) O*+igation! is derived from the Latin word obligatio which means tying or binding. It is a Tie or bond recognize b !aw b virt"e of which one is bo"nd in favor of another to render something ### and this ma consist in giving a thing$ doing a certain act$ or not doing a certain act. CI,IL COD( de)inition %rtic!e 11&' gives the civi! code definition of ob!igation in its (assive as(ect. It mere! stresses the d"t "nder the !aw of the debtor or ob!igor ) he who has the d"t of giving doing$ or not doing) when it s(ea*s of ob!igation as a +"ridica! necessit . ,.) -"asi!contract! -hen the arise from !awf"!$ vo!"ntar and "ni!atera! acts which are enforceab!e to the end that no one sha!! be "n+"st! enriched or benefited at the e.(ense of another.)%rt.,1/,.) In a sense$ these ob!igations ma be considered as arising from !aw. 0.) Com.+iance in Good /ait0! means com(!iance or (erformance in accordance with the sti("!ations or terms of the contract or agreement. Sincerit and honest m"st be observed to (revent one (art from ta*ing "nfair advantage over the other. /.) Wrong! )ca"se o) action)$ according to its !ega! meaning$ is an act or mission of one (art in vio!ation of the legal right or rights )i.e.$ recognize b !aw) of another. In !aw$ the term injury is a!so "sed to refer to the wrongf"! vio!ation of the !ega! right of another. &.) So+"tio inde*iti! is the +"ridica! re!ation which is created when something is received when there is no right to demand it and it was "nd"! de!ivered thro"gh mista*e. )%rt.,1&/.) II. Disc"ssions 1. W0at are t0e essentia+ re1"isites o) an o*+igation2 Gi3e an e4am.+e to i++"strate t0em. 1 The fo"r essentia! re2"isites3 1.) % .assi3e s"*5ect (called debtor or obligor).###the (erson who is bo"nd to the f"!fi!!ment of the ob!igation4 he who has a d"t 4 2.) An acti3e s"*5ect )called creditor or obligee).### the (erson who is entit!ed to demand the f"!fi!!ment of the ob!igation4 he who has a right4 3.) O*5ect or .restation ) subject matter of the obligation).5the cond"ct re2"ired to be observed b the debtor. It ma consist in giving$ doing or not doing. -itho"t the (restation$ there is nothing to (erform. In bi!atera! ob!igations )see %rt. 1161.)$ the (arties are reci(roca!! debtors and creditors4 and 4.) A 5"ridica+ or +ega+ tie )also called efficient cause).5that which binds or connects the (arties to the ob!igation. The tie in an ob!igation can easi! be determine b *nowing the so"rce of the ob!igation. )%rt. 11&7.)

. W06 are o*+igations "nder t0e Ci3i+ Code a 5"ridica+ necessit62 (4.+ain . 8b!igation is a juridical necessity beca"se in case of noncom(!iance$ the co"rts of +"stice ma be ca!!ed "(on b the aggrieved (art to enforce its f"!fi!!ment or$ in defa"!t thereof$ the economic va!"e that it re(resents. In a (ro(er case the debtor or ob!igor ma a!so be made !iab!e for damages$ which re(resent the s"m of mone given as a com(ensation for the in+"r or harm s"ffered b the creditor or ob!ige ) he who ahs the right to the (erformance of the ob!igation) for the vio!ation of his rights. In other words$ the debtor m"st com(! with his ob!igation whether he !i*es it or not4 otherwise$ his fai!"res wi!! be visited with some harmf"! or "ndesirab!e conse2"ences. If ob!igations were not made enforceab!e$ then (eo(!e can disregard them with im("nit . There are$ however ob!igations that cannot be enforced beca"se the are not recognized b !aw as binding.

%. W0at are t0e e+ements or re1"isites in order t0at a .erson ma6 ac1"ire a rig0t o) action in co"rt against anot0er to en)orce t0e .er)ormance o) t0e +atter7s o*+igation2 1 9efore a (erson can be he!d !iab!e for 2"asi#de!ict$ the fo!!owing re2"isites m"st be (resent3 )1.) There m"st be an act or omission4 ),.) There m"st be fa"!t or neg!igence4 )0.) There m"st be damage ca"sed4 )/.) There m"st be a direct re!ation or connection of ca"se and effect between the act or omission and the damage4 and )&.) There is no (re#e.isting contract"a! re!ation between the (arties. 8.Ma6 a .erson inc"r o*+igations e3en 9:o entering into an6 contract or 3o+"ntar6 agreement2 (4.+ain. Yes. 9eca"se according to the :orm of 8b!igations# ;efers to the manner in which an ob!igation is manifested or inc"rred. It ma be ora!$ or in writing$ or (art! ora! and (art! writing.### )1) %s a genera! r"!e$ the !aw does not re2"ire an form in ob!igations arising from contracts for their va!idit or binding force. )see %rt.10&'.) ),) 8b!igation arising from other so"rces )%rt.11&7.) do not have an form at a!!.

III.

'ROBL(MS

1. Yes. In this case$ Y has the ob!igation to reimb"rse < for the said e.(ense 1&= (esos$ a!tho"gh she did not act"a!! give her consent to the act of < in ta*ing her chi!d to the resta"rant to eat$ on the (rinci(!e of 2"asi# contract. -"asi! contract is that +"ridica! re!ation res"!ting from !awf"!$ vo!"ntar and "ni!atera! acts b virt"e of which the (arties becomes bo"nd to each other to the end that no one wi!! be "n+"st! enriched or benefited at the e.(ense of another. ) %rt. ,1/,) . Yes. In this case$ Y is "nder ob!igation to (a the damages ca"sed to < b his act$ a!tho"gh there is no (re# e.isting contract"a! re!ation between them beca"se he is g"i!t of fa"!t or neg!igence. %. >o. 9eca"se according to Lega+ o*+igations Artic+e 11;< refers to !ega! ob!igations or ob!igation arising from !aw. They are not presume they are considered a burden upon the obligor. The are the e.ce(tion$ not the r"!e. To be demandab!e$ the m"st be c!ear! set forth in the !aw. i.e the ?ivi! ?ode or s(ecia! !aws. Th"s3 An em.+o6er 0as no o*+igation to )"rnis0 )ree +ega+ assistance to 0is em.+o6ees *eca"se no +a9 re1"ires t0is# and t0ere)ore# an em.+o6ee ma6 not reco3er )rom 0is em.+o6er t0e amo"nt 0e ma6 0a3e .aid a +a96er 0ired *6 0im to reco3er damages ca"sed to said em.+o6ee *6 a stranger or strangers 90i+e in t0e .er)ormance o) 0is d"ties. 8. That which is agreed "(on in the contract is the !aw between D and ?. Art. 11=>. O*+igations arising )rom contracts 0a3e t0e )orce o) +a9 *et9een t0e contracting .arties and s0o"+d *e com.+ied 9it0 in good )ait0. ?1$>1a@

CHA'T(R St"d6 G"ide I. De)inition 1.) Generic or Determinate t0ing# -hen it refers on! to a c!ass gen"s to which it (ertains and cannot be (ointed o"t with (artic"!arit . ,.) 'ersona+ Rig0t# is the right or (ower of a (erson ) creditor) to demand from another )debtor)$as a definite (assive s"b+ect$ the f"!fi!!ment of the !atter@s ob!igation to give$ to do$ or not to do 0.) Lega+ de+a6 or de)a"+t! or mora is the fai!"re (erform an ob!igation on time which fai!"re constit"tes a breach of the ob!igation /.) /ort"ito"s e3ent# is an event which cannot be foreseen$ or which$ tho"gh foreseen$ is inevitab!e to foresee or im(ossib!e to void. &.) Di+igence o) a good )at0er o) a )ami+6# the (hrase has been e2"ated with ordinar care or that di!igence which an average ) a reasonab! (r"dent) (erson e.ercise over his own (ro(ert . II. Disc"ssions 1. T0e R"+es as to Lia*i+it6 in case o) )ort"ito"s e3ent -hen e.(ress! s(ecified b !aw5In e.ce(tions )a)$ )b)$ and )c) be!ow$ the s(ecia! strictness of the !aw is +"stified. -hen dec!ared b sti("!ation### The basis for this e.ce(tion rests "(on the freedom of contract. See. %rt.10='.) -hen the nat"re of the ob!igation re2"ires the ass"m(tion of ris*5Aere$ ris* of !oss or damages is an essentia! e!ement in the ob!igation. . In case t0e de*tor does not com.+6 9it0 0is o*+igation. T0e creditor ma6 a3ai+ 0imse+) o) t0e )). remedies3 E.act f"!fi!!ment )s(ecific (erformance) with the right to damages4 B"rs"e the !eviab!e )not e.em(t from attachment "nder the !aw) (ro(ert of the debtor4 Cafter ("rs"ed the (ro(ert in (ossession of the debtorD$ e.ercise a!! the rights )!i*e the right to redeem) and bring a!! the actions of the debtor )!i*e the right to co!!ect from the debtor of his debtor) e.ce(t those inherent in or (ersona! to the !atter )s"ch as the right to vote$ to ho!d office$ to receive !ega! s"((ort$ to revo*e a donation on the gro"nd of ingratit"de$ etc.) and %s* the co"rt to rescind or im("gn acts or contracts which the debtor ma have done to defra"d him when he cannot in an other manner recover his c!aim. )see %rt.10E=#10E6)

%. W0at are inc+"ded to *e de+i3ered in an o*+igation to gi3e a de)inite t0ing2 (4.+ain t0em. %ccording To3 ART.11;; T0e o*+igation to gi3e a determinate t0ing inc+"des t0at o) de+i3ering a++ its accessions and accessories# e3en t0o"g0 t0e6 ma6 not 0a3e *een mentioned. (1) %ccessions are the fr"its of a thing or additions to or im(rovements "(on a thing )the (rinci(a!). E.am(!e3
Ao"se or trees on a !and4 rents of a b"i!ding4 air#conditioner in a car4 (rofits or dividends accr"ing from shares of stoc*s$ etc.

(2) %ccessories are things +oined to or inc!"ded with the (rinci(a! thing for the !atter@s embe!!ishment$ better "se$ or com(!etion. E.am(!e3
Fe of a ho"se4 frame of a (ict"re4 brace!et of a watch4 bow of a vio!in.

8. S"..osed t0e o*+igation o) t0e de*tor is to do somet0ing and 0e )ai+s to do it or .er)orms it in contra3ention o) t0e agreement# 90at are t0e remedies a3ai+a*+e to t0e creditor2 Remedies of creditor in positive personal obligation3 ?1@ If the creditor fai!s to com(! with his ob!igation to do$ the creditor ahs the right3 )a) to have the ob!igation (erformed b himse!f$ or b another$ "n!ess (ersona! considerations are invo!ved$ at the debtor@s e.(ense4 and )b) to recover damages. )%rt. 117=) ) ) In case the ob!igation is done in contravention of the terms of the same or is (oor! done$ it ma be ordered )b the co"rt "(on com(!aint) that it be "ndone if it is sti!! (ossib!e to "ndo what was done. =. Can a de*tor *e ."t in de+a6 and conse1"ent+6# inc"r +ia*i+it6 e3en 9:o demand )rom creditor2 (4.+ain. Yes. 9eca"se %ccording to %;T.11'6.Those ob!iged to de!iver or to do something inc"r in de!a from the time the ob!ige +"dicia!! demands from them the f"!fi!!ment of their ob!igation. Aowever$ the demand b the creditor sha!! not be necessar in order that de!a ma e.ist3 )1) -hen the ob!igation or the !aw e.(ress! so dec!ares4 or ),) -hen from the nat"re and the circ"mstances of the ob!igation it a((ears that the designation of the time when the thing is to be de!ivered or the service is to be rendered was a contro!!ing motive for the estab!ishment of the contract4 or )0) -hen demand wo"!d be "se!ess$ as when the ob!igor has rendered it be ond his (ower to (erform. In reci(roca! ob!igation$ neither (art inc"rs in de!a if the other does not com(! or is not read to com(! in a (ro(er manner with what is inc"mbent "(on him. :rom the moment one of the (arties f"!fi!!s his ob!igation$ de!a b the other begins.

;. Ma6 an action arising )rom )ra"d *e 9ai3ed2 (4.+ain. %ccording to3 ART.11A1. Res.onsi*i+it6 arising )rom )ra"d is demanda*+e in a++ o*+igations. An6 9ai3er o) an action )or )"t"re )ra"d is 3oid. 9"t the waiver of action for (ast fra"d va!id. -hat the !aw (rohibits is waiver anterior to the fra"d and to the *now!edge thereof b the aggrieved (art . % (ast fra"d can be the s"b+ect of a va!id waiver beca"se the waiver can be considered as an act of generosit and magnanimit on the (art of the (art who is the victim of the fra"d. Aere$ what is reno"nced is the effect of the fra"d$ that is the right to indemnit of the (art entit!ed thereto. The waiver m"st be e.(ressed in c!ear !ang"age which !eaves no do"bt as to the intention of the ob!igee to give "( his right against the ob!igor. A. Ma6 an action arising )rom neg+igence *e 9ai3ed2 (4.+ain. ART.11A Res.onsi*i+it6 arising )rom neg+igence in t0e .er)ormance o) e3er6 Bind o) o*+igation is a+so demanda*+e# *"t s"c0 +ia*i+it6 ma6 *e reg"+ated *6 t0e co"rts# according to t0e circ"mstances. ?11$%@ Ga!idit of waiver of action arising from neg!igence. )1) %n action for f"t"re neg!igence )not fra"d) ma be reno"nced e.ce(t where the nat"re of the ob!igation re2"ires the e.ercise of e.traordinar di!igence as in the case of common carries. )see %rt.1700.) Th"s$ in he (receding e.am(!e$ the !aw a!!ows an agreement between S and 9$ where b S wi!! not be !iab!e for damages arising from neg!igence in the (erformance of his ob!igation. 9"t if S is a common carrier )e.g.$ b"s$ shi((ing or air!ine com(an ) s"ch waiver is void. ),) -here neg!igence shows bad faith )i.e.$ de!iberate! committed)$ it is considered e2"iva!ent to fra"d. )%rt.,,=1$ ,nd (ar.) %n waiver of an action for f"t"re neg!igence of this *ind is$ therefore$ void.

III.

'ROBL(MS 1. T ac2"ires ownershi( to Si!ver and he sha!! be entit!ed to it as against B. . Ces. 9eca"se Lega! de!a or default or mora is the fai!"re to (erform an ob!igation on time which fai!"re constit"tes a breach of the ob!igation. S agreed to de!iver that ;efrigerator not !ater that H"! 01 b"t he did not de!iver on the said date. %. ?a@ ob!igations of S3 Bending de!iver $ S has the additiona! or accessor d"t to ta*e care of the horse with di!igence of a good father of fami! $ !i*e feeding the horse reg"!ar! $ *ee(ing it in safe (!ace$ etc. In other words S m"st e.ercise that be!onging of him and which he is not "nder ob!igation to de!iver to 9. ?*@ who has the right to the co!tI In a contract of sa!e C a!! the fr"its sha!! (ertain to the vendee from the da on which the contract was (erfectedD )%rt. 1&07$ ,nd (ar.) Aence$ 9 is entit!ed to the co!t. This ho!ds tr"e even if the de!iver is s"b+ect to s"s(ensive condition or a s"s(ensive (eriod )e.g.$ ne.t month) if 9 has paid the price. )c) -ho is the !awf"! owner of s"zieI T is the !awf"! owner. %ccording to3 )Art. 11;= %rd .ar.) ownershi( ac2"ired b de!iver .

8. Yes. %ccording to the simple loan or mutuum a contact whereb one of the (arties de!ivers to another$ mone or other cons"mab!e thing$ "(on the condition that the same amo"nt of the same *ind and 2"a!it sha!! be (aid. It ma be grat"ito"s or with a sti("!ation to (a interest. )%rt. 1600.) =. Yes. The (res"m(tion is that the rent for the month of Han"ar and :ebr"ar had a!read been (aid. This is a!so in accordance with the "s"a! b"siness (ractice whereb (rior insta!!ments. %gain$ this (res"m(tion is mere! dis("tab!e. )%rt. 117'$ ,nd (ar. ,)

CHA'T(R % S(CTION 1 I. D(/INITIONS

1. Condition! is a f"t"re and "ncertain even$ "(on the ha((ening of which$ the effectivit or e.ting"ishment of an ob!igation )or right) s"b+ect to it de(ends. . Ci3i+ Loss! -hen a thing disa((ears in s"ch a wa that its e.istence is "n*nown )e.g.$ a (artic"!ar dog has been missing for sometime)4 or even of *nown$ it cannot be recovered )%rt.11E6J,K.)$ whether as a matter of fact )e.g.$ a (artic"!ar ring is dro((ed from a shi( at sea) or of !aw )e.g.$ a (ro(ert is !ost thro"gh (rescri(tion). %. Reci.roca+ O*+igations! are those which arise from the same ca"se and in which each (art is a debtor and creditor of the other$ s"ch that the (erformance of one is designed to be the e2"iva!ent and the condition for the (erformance of the other. 8 .'re O*+igation! is one which is not s"b+ect to an condition and no s(ecific date is mentioned for its f"!fi!!ment and is$ therefore$ immediate! demandab!e. =. 'otestati3e condition! % condition s"s(ensive in nat"re and which de(ends "(on the so!e wi!! of one of the contracting (arties. II. DISCDSSIONS

1. I++"strate an o*+igation s"*5ect toE Distinction between s"s(ensive and reso!"tor conditions3 The difference between the two conditions is ver c!ear3 both bear an inf!"ence on the e.istence of the ob!igation$ b"t in diametrica!! o((osed manner. )1) If the suspensive condition is f"!fi!!ed$ the ob!igation arises$ whi!e if it is the resolutory condition that is f"!fi!!ed$ the ob!igation is e.ting"ished4 ),) If the first does not ta*e (!ace$ the tie of the !aw )+"ridica! or !ega! tie) does not a((ear$ whi!e if it is the other$ the tie of !aw is conso!idated4 and )0) Unti! the first ta*es (!ace$ the e.istence of the ob!igation is a mere ho(e$ whi!e in the second$ its effects f!ow$ b"t over it hovers the (ossibi!it of termination.)see E Lanresa 10=#101) ART.11< . W0en t0e )"+)i++ment o) t0e condition de.ends ".on t0e so+e 9i++ o) t0e de*tor# t0e conditiona+ o*+igation s0a++ *e 3oid. I) it de.ends ".on c0ance or ".on t0e 9i++ o) a t0ird .erson# t0e o*+igation s0a++ taBe e))ect in con)ormit6 9it0 t0e .ro3isions i) t0is Code. ?111=@

. Gi3e t9o ? @ cases 90en t0e conditiona+ o*+igation is 3a+id a+t0o"g0 t0e condition de.ends entire+6 ".on t0e 9i++ o) t0e de*tor. (4.+ain. )1) The debtor promises to pay hen his means permit him to do so.!!! The ob!igation sha!! be deemed to be one with a (eriod. In this case$ what de(ends "(on the debtor@s wi!! is not whether he sho"!d (a or not for indeed he binds himse!f to (a . -hat is !eft on! to his wi!! is the d"ration of the (eriod. If the creditor and the creditor cannot agrees to the s(ecific time for (a ment$ the co"rt sha!! fi. the same on the a((!ication of either (art . )%rt. 1167$ (ar.,) ),) "ther cases.### %s when the debtor binds himse!f to (a 3 )a)D !itt!e b !itt!eD )b) Cas soon as (ossib!eD )c) Cfrom time to timeD )d) C at an time I have the mone D )e) Cin (artia! (a mentD )f) C when I am in a (osition to (a D %. Ma6 an o*+igor *e +ia*+e "nder an o*+igation s"*5ect to a s"s.ensi3e condition a+t0o"g0 t0e condition 0as not 6et *een )"+)i++ed2 (4.+ain. ;ights (ending f"!fi!!ment of s"s(ensive condition3 ),) ;ight of debtor5Ae is entit!ed to recover what he has (aid b mista*e (rior to the ha((ening of the s"s(ensive condition. This right is grated to the debtor beca"se the creditor ma or ma not be ab!e to f"!fi!! the condition im(osed and hence$ it is not certain that the ob!igation wi!! arise. This is a case of so!"tion indebiti which is based on the (rinci(!e that no one sha!! enrich himse!f at the e.(ense of another. 8. In an o*+igation to gi3e .arce+ o) +and s"*5ect to a s"s.ensi3e condition# 90o is entit+ed to t0e )r"its t0at accr"ed d"ring t0e .endenc6 o) t0e condition once said condition is )"+)i++ed2 In ob!igation to give5an ob!igation to give s"b+ect to a s"s(ensive condition becomes demandab!e on! "(on the f"!fi!!ment of the condition. Aowever$ once the condition f"!fi!!ed$ its effect sha!! retroact to the da when the ob!igation was constit"ted. The reason is beca"se the condition is on! an accidenta! e!ement of a contract. )see %rt. 101E.) %n ob!igation can e.ist witho"t being s"b+ect to a condition. Aad the (arties *nown beforehand that the condition wo"!d be f"!fi!!ed the wo"!d have bo"nd themse!ves "nder a ("re ob!igation. Aence$ the ob!igation sho"!d be considered from the time it is constit"ted and not from the time the condition is f"!fi!!ed.

=. State t0e r"+es in case t0e t0ing to *e de+i3eredE R"+es in case o) +oss# deterioration# or im.ro3ement o) t0ing d"ring .endenc6 o) s"s.ensi3e condition ?a@ is +ost 9it0 t0e de*tor7s )a"+t E.am(!e3 Men ob!iged himse!f to give ?han his car worth 1==$===.== (esos. If the !oss occ"rred beca"se of the neg!igence of Men$ ?han wi!! be entit!ed to demand damages )%rt.117=.)$ i.e.$ 1==$===.== (esos (!"s incidenta! damages$ if an . is +ost 9it0o"t ?de*tor7s@ 0is )a"+t. E.am(!e3 Men ob!iged himse!f to give ?han his car worth 1==$===.== (esos. If ?han wi!! se!! Men@s (ro(ert . The car was !ost witho"t the fa"!t of Men. The ob!igation is e.ting"ished and Men is not !iab!e to ?han even if ?han se!!s the (ro(ert . % (erson as a genera! r"!e$ is not !iab!e for a fort"ito"s event. )%rt. 117/) ?*@ deteriorates 9it0o"t t0e de*tor7s )a"+t 4 ### % thing deteriorates when its va!"e is red"ced or im(aired with or witho"t the fa"!t of the debtor. E.am(!e3 If the car fig"re in an accident$ as a res"!t of which its windshie!d was bro*en and some of its (aints were scratched awa witho"t the fa"!t of Sef$ thereb red"cing its va!"e to 6=$===.== (esos. La. wi!! have to s"ffer the deterioration or im(airment in the amo"nt of 1=$===.== (esos. )%rt. 117/) 1 Deterioration o) t0ing t0ro"g0 de*tor7s )a"+t.F E.am(!e3 In this case$ 9 ma choose between3 )a) ;escission )or cance!!ation) of the ob!igation with damages4 in this case$ Sef is !iab!e to (a La. 1==$===.== (esos the va!"e of the car before its deterioration (!"s incidenta! damages$ if an 4 or )b) :"!fi!!ment of the ob!igation a!so with damages. )see %rt.1161.) In this case$ Sef is bo"nd to La. to give the car and (a 1=$===.== (!"s incidenta! damages$ if an .

III.

'ROBL(MS 1. Yes. 9eca"se in this case$ on! the condition is void b"t not the (re# e.isting ob!igation of D to (a ?. . 9oth the condition and the ob!igation are void. The condition is tantamo"nt to a debtor te!!ing the creditor that he wo"!d (a his ob!igation when and if he wants. %. ;emedies are a!ternative. The remedies of the in+"red or aggrieved are a!ternative and not c"m"!ative$ that is$ he is (rivi!eged to choose on! of the remedies$ and not both$ s"b+ect on! to the e.ce(tion in (aragra(h ,$ to it# he ma a!so see* rescission even after he has chosen f"!fi!!ment if the !atter sho"!d become im(ossib!e. 9"t after choosing rescission of the ob!igation$ he cannot thereafter demand its com(!iance. 8. Limitations on right to demand rescission. The right to rescind b the in+"red (art )the one who has (erformed what is inc"mbent "(on him) is not abso!"te. Th"s5 (1) ;esort to the co"rts. ### The rescission contem(!ated b %rtic!e 1161 is a +"dicia! rescission )(ar. 0.) or one granted b a co"rt. The in+"red (art has to resort to the co"rts to assert his rights +"dicia!! )e.g.$ to recover what he has de!ivered "nder the contract) for the same artic!e (rovides that. . .D. the co"rt sha!! decree the rescission c!aimed$ "n!ess there be +"st ca"se a"thorizing the fi.ing of a (eriod.D >o (erson can ta*e +"stice or the !aw in his own hands and decide b himse!f what are the rights in the matter. The other (art m"st be given an o((ort"nit to be heard. ?=@ -aiver of right. 5 The right to rescind ma be waived$ e.(ress! or im(!ied. Th"s$ the acce(tance b the se!!er of the !and so!d as sec"rit for the ba!ance of the (rice I san im(!ied waiver b the b" er. Ais remed is to recover the ba!ance. =. %n ob!igation is demandab!e at once. )1) when it is ("re )%rt. 1176$ (ar. 1.) ),) when it is s"b+ect to a reso!"tor condition )Ibid.$ (ar. ,.)4 or )0) -hen it is s"b+ect to a reso!"tor (eriod. )%rt. 1660$ (ar. , )

CHA'T(R % S(CTION I. D(/INITIONS 1. O*+igation 9it0 a .eriod! is one whose effects or conse2"ences are s"b+ected in one wa or another to the e.(iration or arriva! of said (eriod or term. . 'eriod or Term! is a f"t"re and certain event "(on the arriva! of which the ob!igation )or right) s"b+ect to it either arises or its terminated. It is a da certain which m"st necessari! come )!i*e the ear ,=1=4 ne.t ?hristmas)$ a!tho"gh it ma not be *nown when$ !i*e the death of a (erson. )%rt.1160$(ar.0.) %. Inde)inite .eriod! -hen it is not fi.ed or it is not *nown when it wi!! come. -here the (eriod is not fi.ed b"t a (eriod is intended$ the co"rts are "s"a!! em(owered b !aw to fi. the same. )see %rt. 1167.@ II. DISCDSSIONS 1. Has t0e de*tor t0e rig0t to reco3er 90at 0e 0as .aid to t0e creditor *e)ore t0e arri3a+ o) t0e .eriod agreed ".on2 (4.+ain. %ccording to3 ART. 11>=. An6t0ing .aid or de+i3ered *e)ore t0e arri3a+ o) t0e .eriod# t0e o*+igor *eing "na9are o) t0e .eriod or *e+ie3ing t0at t0e o*+igation 0as *ecome d"e and demanda*+e# ma6 *e reco3ered# 9it0 t0e )r"its# and interests. ?11 ;a@ Ba ment before arriva! of (eriod. %rtic!e 116& a((!ies on! to ob!igation to give. It is simi!ar to artic!e 11EE$ (aragra(h ,$ which a!!ows the recover of what has (aid b mista*e before the f"!fi!!ment of a s"s(ensive condition. The creditor cannot "n+"st! enrich himse!f b retaining the thing or mone received before the arriva! of the (eriod. . I) an o*+igation does not state a .eriod )or its .er)ormance# 0as a .art6 t0e rig0t to asB a co"rt to )i4 a .eriod or t0e d"ration t0ereo)2 (4.+ain. Ces. 9eca"se according toE %;T. 1167. If the ob!igation does not fi. a (eriod$ b"t from its nat"re and the circ"mstances it can be inferred that a (eriod was intended$ the co"rts ma fi. the d"ration thereof. The co"rts sha!! a!so fi. the d"ration of the (eriod when it de(ends "(on the wi!! of the debtor. In ever case$ the co"rts sha!! determine s"ch (eriod as ma "nder the circ"mstances have been (robab! contem(!ated an the (arties. 8nce fi.ed b the co"rts$ the (eriod cannot be changed b them. )11,Ea)

%. Gi3e t0e cases 90en t0e o*+igee can demand t0e .er)ormance o) an o*+igation e3en *e)ore t0e arri3a+ o) t0e .eriod agreed ".on. $hen obligation can be demanded before lapse of period. The genera! r"!e is that the ob!igation is not demandab!e before the !a(se of the (eriod. Aowever$ in an of the cases mentioned in Artic+e 11><# t0e de*tor s0a++ +ose e3er6 rig0t to maBe "se o) t0e .eriod# t0at is# t0e .eriod is disregarded and t0e o*+igation *ecomes ."re and# t0ere)ore# immediate+6 demanda*+e. The e.ce(tion are based on the fact that the debtor might not be ab!e to com(! with his ob!igation. I. -hen debtor becomes inso!vent. II. -hen the debtor does no f"rnish g"aranties or sec"rities (romised. III. -hen g"aranties or sec"rities given have been im(aired or have disa((eared. I,. -hen debtor vio!ates an "nderta*ing. III. 'ROBL(MS3 1. Yes. Term is for the benefit of the debtor alone. N Ae cannot be com(e!!ed to (a (remat"re! $ b"t he can$ if he desires to do so. In this case$ the (eriod of one )1) ear sho"!d be deemed intended for the benefit of D on! . Therefore$ Ae can (a an time b"t he cannot be com(e!!ed to (a before one )1) ear. . In this case$ it is one with a (eriod Lega! effect where s"s(ensive (eriodOcondition de(ends "(on the wi!! of debtor. )1) The e.istence of the ob!igation is not affected a!tho"gh the (eriod de(ends "(on the so!e wi!! of the debtor. It is on! the (erformance with res(ect to time that is !eft to the wi!! of the debtor. ),) If the ob!igation is s"b+ect to a condition which de(ends "(on the so!e wi!! of the debtor$ the conditiona! ob!igation is void )%rt. 11E,.) beca"se in s"ch case$ it is act"a!! the f"!fi!!ment of the ob!igation that de(ends "(on the wi!! of the debtor. )see %rt. 10=E.) %. Aere ? can demand (a ment at an time b"t D cannot shortened the one# ear (eriod witho"t the consent of ?. 8rdinari! $ there m"st be a sti("!ation granting the benefit of the term to on! the creditor.

CHA'T(R % S(CTION % I. D(/INITON 1. A+ternati3e O*+igation! is one wherein vario"s (restations are d"e b"t the (erformance of one of them is s"fficient as determined b the choice which$ as a genera! r"!e$ be!ongs to the debtor. )E Lanresa 17'4 %rt. 1,==.) . /ac"+tati3e O*+igation! is one where on! one (restation has been agreed "(on b"t ob!igor ma render another in s"bstit"tion. %. Con5"ncti3e O*+igation! one where there are severa! (restations and a!! of them are d"e.

II.DISCDSSION 1. W0at are t0e +imitations on t0e rig0t o) c0oice o) t0e de*tor in a+ternati3e o*+igations2 I++"strate one s"c0 +imitation. The debtor cannot choose those (restation which are4 )a) im(ossib!e$ )b) "n!awf"!$ or )c) which co"!d not have been the ob+ect of the ob!igation. These (restation are void. Their (resence do not inva!idate the ob!igation if it inc!"des other "nderta*ings otherwise free from s"ch defects. In other words$ "nder %rtic!e 1,==$ the debtor@s right of choice is not e.ting"ished a!together b"t !imited to the remaining va!id (restations. . Gi3e t0e sit"ation 90en t0e de*tor is gi3en t0e o.tion eit0er to e4ercise 0is rig0t o) c0oice or to rescind t0e contract 9it0 damages. %. State t0e +ega+ e))ects in case3 ?a@ Some o) t0e o*5ects o) t0e o*+igation are +ost t0ro"g0 t0e )a"+t o) t0e de*tor 90o 0as t0e rig0t o) c0oice. ?*@ A++ are +ost t0ro"g0 0is )a"+t.

III. 'ROBL(MS 1.@ T0e rig0t o) c0oice o) t0e de*tor is s"*5ect to +imitations. T0"s!!! ?1@ The debtor cannot choose those (restation which are3 )a) im(ossib!e$ )b) "n!awf"!$ or )c) which co"!d not have been the ob+ect of the ob!igation. These (restation are void. ? @ The debtor has no more right of choice when$ among the (restations whereb he is a!ternative! bo"nd$ on! one is (racticab!e. )%rt. 1,=,.@ .@ Artic+es 1 $% and 1 $8 a..+6 90en t0e rig0t o) c0oice *e+ongs to t0e de*tor. Dnder Artic+e 1 $=# t0e creditor 0as t0e rig0t to c0oose. ?a@ Item t9o is +ost or destro6edG T0e +ost o) item t9o 9it0 or 9it0o"t t0e )a"+t o) H 9i++ red"ce t0e o*+igation to a sim.+e one. ?1@ Some o) t0e o*5ects. I if some of the ob+ects of the ob!igation have been !ost or have become im(ossib!e even thro"gh the fa"!t of the debtor$ the !atter is not !iab!e since he has the right of choice and the ob!igation can sti!! be (erformed. ?*@ A++ item are +ost or destro6ed I) a++ item is +ost t0ro"g0 0is )a"+t# +ia*i+it6 9i++ attac0G i) t0ro"g0 a )ort"ito"s e3ent# t0e o*+igation 9i++ *e e4ting"is0ed ? @ A++ o) t0e o*5ects.FIf a!! of them have been !ost or have become im(ossib!e thro"gh his fa"!t$ the creditor sha!! have the right to indemnit for damages since the ob!igation can no !onger be com(!ied with. 8f co"rse$ if the ca"se of the !oss is fort"ito"s event$ the ob!igation is e.ting"ished. %.@ S is not +ia*+e to B# )or its +oss since 0is o*+igation is to de+i3er t0e Re)rigerator. ? Art. 1 $1.@ ?*@ In the first$ where the choice be!ongs to the creditor$ the !oss of one a!ternative thro"gh the fa"!t of the debtor gives rise to !iabi!it $ whi!e in the second$ the !oss of the s"bstit"te before the s"bstit"tion thro"gh the fa"!t of the debtor does not give him !iab!e.

CHA'T(R % S(CTION 8 I. D(/INITION 1. Joint O*+igation# or one where the who!e ob!igation is to be (aid or f"!fi!!ed (ro(ortionate! b the different debtors andO or is to be demanded (ro(ortionate! b the different creditors. )%rt. 1,=E) ,. So+idar6 O*+igation# or one where each one of the debtors is bo"nd to render$ andO or each one of the creditors has a right to demand from an of the debtors$ entire com(!iance with the (restation. )%rt.1,=7) 0. Acti3e So+idarit6# so!idarit on the (art of the creditors$ where an one of them can demand the f"!fi!!ment of the entire ob!igation. Its essentia! feat"res is that of m"t"a! re(resentation among the so!idar creditors with (owers to e.ercise the right of others in the same manner as their rights. )seeE Lanresa ,=&#,='.) /. Joint indi3isi*+e O*+igation# the ob!igation is +oint beca"se the (arties are mere! (ro(ortionate! !iab!e. It is indivisib!e beca"se the ob+ect or s"b+ect matter is not (h sica!! divisib!e into different (arts.)see %rt. 1,,&$(ar. 11) &. So+idarit6 di3isi*+e O*+igations# II. DISCDSSION 1.@ S"((ose that in the same ob!igation$ the share of each debtor )or the share of each creditor$ if there are two or more creditors) is not s(ecified. In s"c0 case t0e .res"m.tion is t0at t0e o*+igation is Joint ?Arts. 1 $A! 1 $<.@ .@ Art. 1 18 T0e de*tor ma6 .a6 an6 one o) t0e so+idar6 creditorsG *"t an6 demand# 5"dicia+ or e4tra5"dicia+# 0as *een made to 0im. ?118 a@ %.@ ?a@ ())ect o) no3ation# etc. W0ere o*+igation is JointE In a 5oint o*+igation# no3ation# com.ensation# con)"sion# remission# .rescri.tion# and an6 ot0er ca"ses o) modi)ication or e4tinction does not e4ting"is0 or modi)6 t0e o*+igation e4ce.t 9it0 res.ect to t0e creditor or de*tor a))ected# 9it0o"t e4tending its o.eration to an6 ot0er .art o) t0e de*tor or o) t0e credit. ?*@ ())ect o) .a6ment *6 a so+idar6 de*torE ?1@ Bet9een t0e so+idar6 de*tor and creditor?s@.F(a ment made b one of the so!idar debtors e.ting"ishes the ob!igation. )-hen s(ea*ing of (a ment that e.ting"ishes an ob!igation$ the !aw refers to (a ment in f"!!.) Aowever$ the creditor for his (rotection is given the right to choose which offer to acce(t if two or more so!idar debtors offer to (a . )(ar. 1.) ? @ Among t0e so+idar6 de*tors.F%fter (a ment of the debt$ the (a ing so!idar debtor can demand reimb"rsement from his co#debtors for their (ro(ortionate with )!ega!) interest on! from the time of (a ment. The debtors do not become$ b virt"e of s"ch (a ment$ so!idar debtors of the debtor# (a er. Aeir !iabi!it is not based on the origina! ob!igation which has been e.ting"ished b"t "(on the (a ment made b the co#debtor which creates a +oint ob!igation of reimb"rsement on the (art of the others. )%rt. 1,=E.) Aowever$ in case of inso!vent one (ro rate. )(ars. , and 0.)
?%@ %mong the so!idar creditors.5The receiving creditor is +oint! !iab!e to the others for their corres(onding shares. )%rt. 1,=E.)

CHA'T(R % S(CTION = I. D(/INITION 1. Di3isi*+e O*+igation# is one the ob+ect of which$ in its de!iver or (erformance$ is ca(ab!e of (artia! f"!fi!!ment. . Indi3isi*+e O*+igation# is one the ob+ect of which$ in its de!iver or (erformance$ is not ca(ab!e of (artia! f"!fi!!ment. 0. Lega+ indi3isi*i+it6# -here a s(ecific (rovision of !aw dec!ares as indivisib!e$ ob!igation which$ b their nat"re$ are divisib!e )%rt. 1,,&$ (ar. 0.) III. DISCDSSION 1. (4.+ainE T0e di3isi*i+it6 o) an o*+igation is di))erent )rom t0e di3isi*i+it6 o) t0e t0ing 90ic0 is t0e o*5ect t0ereo). Art. 1 %. The divisibi!it or indivisibi!it of the things that are the ob+ect of ob!igations in which there is on! debtor and on! one creditor does not a!ter or modif the (rovisions of ?ha(ter , of this Tit!e. )11/6) . W0at o*+igations are deemed indi3isi*+e2 ?1@ O*+igation 90ic0 0a3e )or t0eir o*5ect t0e e4ec"tion o) a certain n"m*er o) da6s o) 9orB. ?.ar.1. @ ? @ O*+igation 90ic0 0a3e )or t0eir o*5ect t0e accom.+is0ment o) 9orB *6 metrica+ "nits. ?I*id.@ ?%@ O*+igation 90ic0 *6 t0eir nat"re are s"sce.ti*+e o) .artia+ .er)ormance. ?I*id.@ %. W0at o*+igation are deemed di3isi*+e2 ?1@ o*+igations to gi3e de)inite t0ings. ?.ar.1. @ ? @ O*+igation 90ic0 are not s"sce.ti*+e o) .artia+ .er)ormance. ?I*id.@ ?%@ O*+igation .ro3ided *6 +a9 to *e indi3isi*+e e3en i) t0ing or ser3ice is .06sica++6 di3isi*+e. ?.ar.%. @ ?8@ O*+igation intended *6 t0e .arties to *e indi3isi*+e to *e indi3isi*+e e3en i) t0ing or ser3ice is .06sica++6 di3isi*+e. ?.ar.%.@

CHA'T(R % S(CTION ; I. D(/INITION 1.@ O*+igation 9it0 a .ena+ c+a"se! is one which contains an accessor "nderta*ing to (a a (revio"s! sti("!ated indemnit in case of breach of the (rinci(a! (restation$ intended (rimari! to ind"ce its f"!fi!!ment. .@ 'ena+ c+a"se# is an accessor "nderta*ing attached to an ob!igation to ass"me greater !iabi!it in case of breach$ i.e.$ the ob!igation is not f"!fi!!ed. 8r is (artia!! or irreg"!ar! com(!ied with. %.@ Joint or c"m"+ati3e .ena+ c+a"se! -hen both the (rinci(a! ob!igation and the (ena! c!a"se can be enforcedO )E Lanresa ,1&.) II. DISCDSSIONS

1.@ '"r.oses o) .ena+ c+a"se. T0e6 areE )1) to ins"re their (erformance b creating an effective deterrent against breach$ ma*ing the conse2"ences of s"ch breach as onero"s as it ma be (ossib!e. )Y"!o vs. ?han Be$ 1=1 Bhi!. 10/.) This is the genera! ("r(ose of a (ena! c!a"se4 and ),) to s"bstit"te a (ena!t for the indemnit for damages and the (a ment of interest in case of non com(!iance )%rt. 1,,'.)4 or to ("nish the debtor for the non f"!fi!!ment or vio!ation of his ob!igation. In t0e )irst case# t0e ."r.ose is re.arationG in t0e second# ."nis0ment. .@ Ces. %ccording to$ 'ena+t6 s"*stit"tes )or damages and interests. %s agenera! r"!e$ in an ob!igation with a (ena! c!a"se$ the (ena!t ta*es the (!ace of the indemnit for damages and the (a ment of interests in case of non#com(!iance. )%rt. 1,,'.) Broof of act"a! damages s"ffered b the creditor is not necessar in order that the (ena!t ma be enforced. )%rt. 1,,E.) %.@ -hen (ena!t ma be enforced. The (ena!t ma be enforced on! when it is demandab!e in accordance with the (rovision of the ?ivi! ?ode. )Ibid.$ Bar. ,.) This means that the (ena!t $ as a sti("!ation in a contract$ is demandab!e on! if there is breach of the ob!igation and it is not contrar to !aw$ mora!s$ good c"stoms$ ("b!ic order$ or ("b!ic (o!ic . )%rt. 10='.) Th"s$ if the ob!igation cannot be f"!fi!!ed d"e to a fort"ito"s event$ the (ena!t is not demandab!e. Under %rtic!e 1,,6$ the (ena!t ma be red"ced if it is ini2"ito"s or "nconscionab!e or in case there is (artia! or irreg"!ar f"!fi!!ment.

CHA'T(R 8 S(CTION 1 I. D(/INITION 1.@ 'a6ment! according to3 ART. 1 % . 'a6ment means not on+6 t0e de+i3er6 o) mone6 *"t a+so t0e .er)ormance# in an6 ot0er manner# o) an o*+igation. (1) %n ordinary parlance$ (a ment refers on! to the de!iver of mone . (2) %s a !ega! mode of e.ting"ishing an ob!igation$ it has a m"ch wider meaning. Ba ment ma consist of not on! in the de!iver of mone b"t a!so the giving of a thing )other than mone )$ the doing of an act$ or not doing of an act. -hen a debtor (a s damages or (ena!t in !ie" of the f"!fi!!ment of an ob!igation. )see %rt. 1,,'.) .@ Dation in .a6ment# (adjudication or dacion en pago) is the conve ance of ownershi( of a thing as an acce(ted e2"iva!ent of (erformance. )Lanresa 01/) %.@ A..+ication o) .a6ment# is the designation of the debt to which sho"!d be a((!ied the (a ment made b a debtor who has vario"s debts of the same *ind in favor of one and the same creditor. )%rt. 1,&,$ (ar. 1) 8.@ 'a6ment *6 cession# is another s(ecia! form of (a ment. It is the assignment or abandonment of a!! the (ro(erties of the debtor for the benefit of his creditors in order that the !atter ma se!! the same and a((! the (roceeds thereof to the satisfaction of their credits. ) Lanresa 0,1) =.@ Consignation# is the act of de(ositing the thing or amo"nt d"e with the (ro(er co"rt when the creditor does not desire or cannot receive it$ after com(! ing with the forma!ities re2"ired b !aw. It is a((!icab!e when there is debt or an ob!igation to (a . It is a!wa s +"dicia! and it genera!! re2"ires a (rior tender of (a ment which is$ b its ver nat"re$ e.tra+"dicia!. )%rt. 1,&'$ (ar.1)

CHA'T(R 8 S(CTION I. D(/INITION 1.@ Lega+ im.ossi*i+it6# occ"rs when the ob!igation cannot be (erformed beca"se it is rendered im(ossib!e b (rovision of !aw$ a!tho"gh (h sica!! it ma be (ossib!e of (erformance. >ote that %rtic!e 1,'' ma*es e.(ress reference to ob!igation to do or to (ersona! ob!igations.

.@ Loss o) t0ing! it is "nderstood that a thing is !ost when it (erishes$ or goes o"t of commerce or disa((ears in s"ch a wa that its e.istence is "n*nown or it cannot be recovered. )%rt. 11E6$ (ar. ,.)

%.@ Di))ic"+t6 o) .er)ormance! The genera! r"!e is that im(ossibi!it of (erformance re!eases the ob!igor. -hen the (erformance of the service has become so diffic"!t as to be manifest! be ond the contem(!ation of both (arties$ the co"rt is a"thorized to re!ease the ob!igor in who!e or in (art. It wo"!d be doing vio!ence to the intention of the (arties to ho!d the ob!igor sti!! res(onsib!e. There is an e!ement of the "nforeseen or fort"ito"s in the sit"ation covered b %rtic!e 1,7'. ) see %rt. 117/.)

CHA'T(R 8 S(CTION %

I. D(/INITION 1.@ Condition or remission o) de*t! is the grat"ito"s abandonment b the creditor of his right against the debtor. )/ ;oman /,,.) It is th"s a form of donation. .@ Ino))icio"s remission! -hi!e a (erson ma ma*e donation$ no one can give more than that which he can give b wi!!4 otherwise$ the e.cess sha!! be inofficio"s and sha!! be red"ced b the co"rt according! . II. D(/INITION 1.@ Re1"isites o) condonation or remission. The re2"isites are the fo!!owing3 )1) It m"st be grat"ito"s4 ),) It m"st be acce(ted b the ob!igor4 )0) The (arties m"st have ca(acit 4 )/) It m"st not be inofficio"s4 and )&) If made e.(ress! $ it m"st com(! with the forms. .@ Under the second (aragra(h of %rtic!e 1,71 the ren"nciation of the action which the creditor had against the debtor ma be n"!!ified or inva!idated b a showing that the waiver is inofficio"s. In other words the remission becomes n"!! and void (roof that it is inofficio"s. The debtor or his heirs ma (rove that the de!iver of the doc"ment was rea!! made in virt"e of (a ment of the debt and not of remission.

CHA'T(R 8 S(CTION 8 I. D(/INTION 1. I .@ Con)"sion or merger! is the meeting in one (erson of the 2"a!ities of creditor and debtor with res(ect to the same ob!igation. ART. 1 A;. Merger 90ic0 taBes .+ace in t0e .erson o) t0e .rinci.a+ de*tor or creditor *ene)its t0e g"arantors. Con)"sion 90ic0 taBes .+ace in t0e .erson o) an6 o) t0e +atter does not e4ting"is0 t0e o*+igation. ?11>%@ II. DISCDSSIONS 1. Con)"sion in so+idar6 o*+igation. Lerger in the (erson of one of the so!idar debtors sha!! e.ting"ish the entire ob!igation beca"se it is a!so a merger in the other so!idari debtors. )%rt. 1,1&.) ;emember that in a so!idar ob!igation there is on! one ob!igation and ever debtor is individ"a!! res(onsib!e for the (a ment of the who!e ob!igation. Ae who ma*es (a ment ma c!aim reimb"rsement from his co#debtors for the shares which corres(ond to them. )%rt. 1,17$ oar. ,.) .@ ?a@ ())ect o) merger in t0e .erson o) .rinci.a+ de*tor or creditor . Lerger in the (erson of the (rinci(a! debtor or creditor e.ting"ishes the ob!igation. Aence$ the accessor ob!igation of g"arant is a!so e.ting"ished in accordance with he (rinci(!e that the accessor fo!!ows the (rinci(a!. ?*@ ())ect o) merger in t0e .erson o) g"arantor. The e.ting"ishment of the accessor ob!igation does not carr with it that of the (rinci(a! ob!igation. ?onse2"ent! $ merger$ which ta*es (!ace in the (erson of the g"arantor$ whi!e it e.ting"ishes the g"arant $ !eaves the (rinci(a! ob!igation in force.

CHA'T(R 8 S(CTION = I. D(/INITION 1.@ Com.ensation! is the e.ting"ishment to the conc"rrent amo"nt of the debts of two (ersons who$ in their own right$ are debtors and creditors of each other. )%rts. 1,7E$ 1,6=.) .@ Lega+ com.ensation! -hen it ta*es (!ace b o(eration of !aw even witho"t the *now!edge of the (arties )%rts. 1,76$ 1,6=.) %.@ /ac"+tati3e com.ensation! -hen it can be set "( on! b one of the (arties. )see %rts. 1,E7$ (ar14 1,EE.) II. DISCDSSIONS 1.@ Com.ensation and con)"sion disting"is0ed. The differences are3 )1) In conf"sion$ there is on! one (erson who is a creditor of himse!f$ whi!e in com(ensation$ there are two (ersons invo!ved$ each of whom is a debtor and a creditor of the other4 ),) In conf"sion$ there is b"t one ob!igation$ whi!e in com(ensation$ there are two ob!igations4 and )0) In conf"sion$ there is im(ossibi!it of (a ment$ whi!e in com(ensation$ there is indirect (a ment. There ma be com(ensation in +oint and so!idar ob!igations. )see %rts. 1,=7$ 1,=E$ 1,1&.) .@ Com.ensation is simi+ar to .a6ment. If a debtor has vario"s debts which are s"sce(tib!e of com(ensation$ he m"st inform the creditor which the creditor which of them sha!! be the com(ensation sha!! be a((!ied to the most onero"s ob!igation. )%rts.1,&,$ 1,&/.)

CHA'T(R 8 S(CTION ; I. D(/INITION 1.@ No3ation! is the tota! or (artia! e.tinction of an ob!igation thro"gh the creation of a new one which s"bstit"tes it. .@ Mi4ed no3ation! -hen the ob+ect and O or (rinci(a! condition of the ob!igation and the debtor or the creditor$ or both the (arties$ are changed. It is a combination of rea! and (ersona! novations. )Ibid.)

%.@ (4.romision or that which ta*es (!ace when a third (erson of his own initiative and witho"t the *now!edge or against the wi!! of the origina! debtor ass"mes the !atter@s ob!igation with the consent of the third (erson and the creditor.

8.@ De+egacion or that which ta*es (!ace when the creditor acce(t a third (erson to ta*e (!ace of the debtor at the instance of the !atter. The creditor ma withho!d a((rova!. )%rt. 1,6&.)

II.

DISCDSSION

1.@ Re1"isites o) no3ation. In novation$ there are for essentia! re2"isites$ name! 3 )1) % (revio"s va!id ob!igation4 ),) ?a(acit and intention of the (arties to modif or e.ting"ish the ob!igation4 )0) The modification or e.ting"ishment of the ob!igation4 and )/) The creation of a new va!id ob!igation. .@ The creditor to whom (artia! (a ment has been made b the new creditor remains a creditor to the e.tent of the ba!ance of the debt. In case of so!venc of the debtor$ he is given a (referentia! right "nder the above artic!e ?Art.1%$8.@ to recover the remainder as against the new creditor. %.@ ?a@())ect 90ere t0e ne9 o*+igation 3oida*+e. If the new ob!igation is on! voidab!e$ novation can ta*e (!ace. 9"t the moment it is ann"!!ed$ the novation m"st be considered as not having ta*en (!ace$ and the origina! one can be enforced$ "n!ess the intention of the (arties is otherwise. ?*@())ect 90ere t0e o+d o*+igation 3oid or 3oida*+e. This artic!e has its basis a!so on the re2"isites of a va!id novation. % void ob!igation cannot be novated beca"se there is nothing to novate. Aowever$ if the origina! ob!igation is on! voidab!e )%rt. 106=4 >ote3 % voidab!e ob!igation is va!id "nti! it is ann"!!ed in co"rt.) or if the voidab!e ob!igation is va!idated b ratification )see %rts. 106,$1066'.)$ the novation is va!id 8.@ In Art. 1 >; fo!!ows the genera! r"!e that the e.ting"ishment of the (rinci(a! ob!igation carries with it that of the accessor ob!igation . )see %rts. 1,0=$ 1,70$ 1,E=.) It (rovides$ however$ an e.ce(tion in the case of an accessor ob!igation created in favor of a third (erson which remains in force "n!ess said third (erson gives his consent to the novation. ) see %rt.1011. (ar. ,.) This is so beca"se a (erson sho"!d not be (re+"diced b the act of another witho"t his consent. ART. 1 >;. W0en t0e .rinci.a+ o*+igation is e4ting"is0ed in conse1"ence o) a no3ation# accessor6 o*+igation ma6 s"*sist on+6 inso)ar as t0e6 ma6 *ene)it t0ird .ersons 90o did not gi3e t0eir consent. ?1 $A@