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Special Notes and Practical Exercises on Joint and Solidary Obligations

Special Notes and Practical Exercises on Joint and Solidary Obligations

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Kinds of Obligation according to number of parties:

1. Individual obligation one where there is only one

obligor an one oblige; and

2. Collective obligation one where there are two or

more debtors and/or two or more creditors.

Joint obligation

Solidary obligation

Joint obligation each of the debtors is liable only for a proportionate part

of the debt and

each creditor is entitled to a proportionate part of the

credit.

NOTE:

In the absence of stipulation, when there are multiplicity of parties or

collective obligation, said obligation is presumed JOINT. Meaning, the share in

the obligation is specified, the correlative rights and obligation of the parties are

known.

Implications:

a) There are as many debts as there are debtors;

b) There are as many credits as there are creditors;

c) The debts/credits are considered distinct and separate from one another.

d) Each creditor is entitled only for a proportionate part of the credit.

e) Each debtor is liable only for his proportionate part of the debt.

Presumption established under Article 1208 is only disputable.

Other terms for joint obligation:

a) mancomunada

b) mancomunada simple

c) proportionately

d) pro-rata

Examples:

Joint obligation

A, B and C jointly executed a promissory note worded as

follows:

We promise to pay to the order of X P9,000.00

Sgd. A, B and C

Solidary obligation each debtor is liable for the entire obligation and each

creditor is

entitled to demand the whole obligation.

two or more debtors in one and the same obligation does not imply solidarity.

By presumption of the law, the obligation is joint, unless:

a) Solidarity is expressly agreed upon (Conventional Solidarity)

b) Solidarity is declared by law (Legal Solidarity)

c) Solidarity is required by the nature of the obligation (Real

Solidarity)

Kinds of Solidarity

a) Active - solidarity among creditors

b) Passive solidarity among debtors

c) Mixed solidarity on the part of the creditors and debtors

Example:

1.

A, B, & C jointly executed a promissory note worded as

follows:

I promise to pay to the order of X P9,000.000

Sgd. A, B & C

X can collect the entire P 9,000 from any of A, B or C.

2. A, B and C joint debtors are obliged to give x, Y and Z, solidary creditors of P

18,000. How much can X collect and from whom?

X being a solidary creditor

can entirely collect P 18,000. But since A, B and c are joint debtors, X may

collect only P 6,000 from each of them. After collecting the sum of P 18,000, X

must give Y and Zs share of P 6,000.

3. A, B and C solidary debtor are obliged to give X,Y and Z joint creditors of P

18,000. How much may A be made liable? A being a solidary debtor may be

held liable for P 18,000. But since the creditors are merely joint ones, each one

of them can collect from A up to P 6,000.

Rules in case of Dual Nature of Obligation

If the obligation of the debtors is joint and the right of the creditors is solidary, or if

the obligation of the debtors is solidary and right of creditors is joint, the rules on

joint and solidary obligation shall be applied in determining the liabilities and rights

of the debtors and creditors as the case maybe.

A. Joints debtors and solidary creditors (Active solidarity)

A, B, C and D, joint debtors are liable to X, Y and Z, solidary creditors, in the amount

of P 36,000. Any one of the creditors can collect the entire amount of P 36,000 but

each one of debtors can be held liable for not more than P 9,000. Thus X can collect

P 36,000 but he can collect not more than 9,000 from A, 9,000 from B, 9,000 from C

and 9,000 from D. After X has collected the P 36,000, he must give P 12,000 each

to Y and Z.

B. Solidary debtors and Joint Creditors (Passive Solidarity)

A, B, C and D, solidary debtors are liable to X, Y and Z, joint creditors in the amount

of P 36,000. Anyone of the debtor can be held liable for the entire amount of P

36,000, but each of the creditors can collect only up to 12,000. Thus X, Y and Z can

collect 12,000 from A alone. After A has made the payment of P 36,000, he can

demand reimbursement of P 9,000 each from B, C and D

Illustrations:

1. A, B, C and D are obliged to give X, Y and Z P12,000. X may collect from A how

much?

* P1,000. When the obligation is silent, it is presumed joint.

2. A, B, C and D, joint debtors are obliged to give X, Y, and Z, solidary creditors,

P12,000. How much may X collect from A?

* P 3,000. As a solidary creditor, X may collect the whole amount owed by the

joint debtor A.

3. A, B, C and D, solidary debtors, are obliged to give X, Y and Z, joint creditors,

P12,000. How much may X collect from A?

* P4,000. As a joint debtor X is entitled only to his proportionate share, and A

being a solidary debtor may be required to pay the said amount.

4. A, B, C and D, solidary debtors, are obliged to give X, Y and Z, solidary creditors,

P12,000. How much may X collect from A?

* P12,000. X being a solidarity creditor may ask for the payment of the whole

amount in behalf of his co-creditors subject to a responsibility of X to give the latter

their corresponding shares. Similarly, A as a solidary debtor may be required to pay

the whole amount of the obligation subject to reimbursement from his co-debtors.

5. A and B are indebted to X and Y for P10,000. A and B share in the debt in the

ratio of 1:3 while X and Y share in the credit in the ratio of 2:3.

a. How much may X collect from A if the debtors are joint debtors, while the

creditors are joint creditors?

* P1,000. The obligation is joint on both the debtor and creditor,

therefore there are as many debts (credits) as debtors (creditors).

COMPUTATION:

Proportionate Share of A:

x P10,000 =

P 2,500

Proportionate Share of B on As Proportionate Debt:

2/5 X P2,500=

P 1,000

b. How much may X collect from A if there is active solidarity?

* P2,500(see computation above). The whole amount of the

proportionate share of A could be collected by X. As a solidary creditor, X may

collect the whole amount of the obligation corresponding against one or more

debtors.

c. How much may X collect from A if there is passive solidarity?

* P4,000. Being a joint creditor, X can collect only his corresponding

share in the credit. The full amount could be collected to A, being a solidary debtor.

COMPUTATION:

Proportionate Share of X in the credit:

2/5 x P10,000 =

P 4,000

d. How much may X collect from A if there is mixed solidarity?

P10,000. Since there is mixed solidarity the whole amount of obligation

may be collected by any of the solidary creditors against any of the solidary

debtors.

A and B owe X and Y P 20,000.00. The share of A in the debt is one-fourth

(1/4), while that of B is three-fourths (3/4). The share of X in the credit is twofifths (2/5), while that of Y is three-fifths,

a. Joint debtors and creditors

A can be held liable for not more than P 5,000.00 (1/4 of P

20,000) while B not more than P 15,000 (3/4 of P 20,000). X can

collect not more than P 8,000 (2/5 of P 20,000) while & not more

than P 12,000 (3/5 of P 20,000)

1. How much may X collect from A? from B?

From A, X may recover P 2,000 (1/4 of P 8,000).

From B, X may collect P 6,000 (3/4 of P 8,000)

Alternate computations A, (P 5,000 x 2/5 P 2,000);

B, (P 15,000 x 2/5 P 6,000)

2. How much may Y collect from A> form B?

From A, Y may collect P 3,000 (1/4 of P 12,000).

From B, Y may collect P 9,000 (3/4 of P 12,000).

Alternate computations: A, (P 15,000 x 3/5 P 3,000) B, (P 15,000 x 3/5

9000)

b. Joint debtors and solidary creditors (active solidarity)

1. How much may X collect from A? From B?

X may collect the total amount of debt amounting

to P 20,000 he being a solidary creditor. However

since the debtors are jointly bound, he can collect

not more than P 5,000 from A and not more than P

15,000 from B. After collecting the amount of P

20,000, X must give the share to Y amounting to P

12,000.

2. How much may Y collect from A? From B?

If Y is the one collecting instead of X, he may also

collect the whole amount of P 20,000. However,

since the debtors are jointly bound, he cannot

collect Php 5,000 from A, and not more than P

15,000 from B. After collecting the amount of P

20,000, Y must give the share of X amounting to P

8,000.

c. Soliday debtors and joint creditor (passive solidarity)

1. How much may A be held liable and by

whom?

A may be held be liable for the whole amount of P

20,000. However, since the creditors are jointly

bound, X can collect from him not more than P

8,000, and Y, not more than P 12,000. If A pays the

debt, he can demand reimbursement from B in the

amount P 15,000.

2. How much may B be held liable and by

whom?

The same as in preceding answer, i.e,P 20,000 (X,

8,000; Y, P

12,000). But if B pays debt he can demand

reimbursement from

A in the amount of P 5,000.

d. Solidary debtors and solidary creditors ( mixed solidarity)

In this case, either A or B may be held liable by

either X or Y in the amount of P 20,000. If A is the one

making the payment, he can demand reimbursement of P

can demand reimbursement of P 5,000 from A. If X is the

one collecting, he must give the share of Y in the amount

of P 12,000. If Y is the one collecting, he must give the

share of X in the amount of P 8,000.

Other terms for solidary obligation:

a) In solidum

b) Jointly and severally

c) Juntos o separadamente

d) Solidarias

e) Mancomumanda o in solidum

f) Mancomunada soldarias

g) Individually and collectively

Effects if obligation is JOINT and INDIVISIBLE. Art 1209 and Art.1224

A JOINT INDIVISIBLE OBLIGATION IS AN OBLIGATION WHERE THERE ARE

SEVERAL DEBTORS OR CREDITORS WHO ARE JOINTLY BOUND BUT THE

PRESTATION IS INDIVISIBLE.

The debt can be enforced by the collective acts of the debtors or

creditors in view of the indivisibility of the object. Like in the case of the joint

debtors the creditor has to proceed against all of them, otherwise, failure of

the other debtors to comply the obligation would call for the conversion of

the obligation to its monetary value or indemnity for damages plus payment

of damages as to defaulting debtors. The same rule applies to joint creditors

they have to proceed to the debtor jointly to ensure the fulfillment of the

obligation.

Illustration:

A, B and C are obliged to deliver a specific horse to X, Y and Z. What would be the

legal effect when C cannot comply with his obligation?

*This is a case of a jointly-indivisible obligation. Assuming there was a valid

demand made against all the debtors and since C could not comply with his part of

the obligation, the obligation is converted into a monetary obligation to pay the

value of the horse plus damages. (1224)

Rules Governing Solidary Obligations:

Solidarity does not imply indivisibility. An obligation may be divisible even if it

is solidary.

Indivisibility does not imply solidarity. It is the intention of the parties that

provides for the

nature of obligation (Art. 1210)

Solidarity may exist although the creditor and debtor may not be bound in the

same manner

same period and conditions. ( Art. 1211)

Each one of the solidary creditors may do whatever may be useful to others but

not anything that is prejudicial to the others ( Art. 1212). A solidary creditor

cannot assign his rights without the consent of the others (Art. 1213)

Essential feature is Mutual Agency.

The debtor may pay any one of the solidary creditors; but if any demand, judicial or

extrajudicial, has been made by one of them, payment should be made to him.

(Article 1214)

solidary creditors or with any of the solidary debtors, shall extinguish the obligation,

without prejudice to the provisions of Article 1219. The creditor who may have

executed any of these acts, as well as he who collects the debt, shall be liable to the

others for the share in the obligation corresponding to them. ( Article 1215)

Illustrations: Renunciation

1. A, B and C are solidary debtors of X, Y and Z, solidary creditors, in the amount of

P2,700. X renounces the whole obligation without the consent of Y and Z. The

debtors accepted the renunciation. What is the legal effect of the renunciation?

* The whole obligation is extinguished, however X shall be liable to the

corresponding shares of the other co-creditors as they have agreed upon.

2. A, B and C are solidary debtors of X in the amount of P3,000. X renounces the

share of A and A accepts the renunciation. Thereafter B becomes insolvent. What is

the legal effect of the renunciation?

* A will be liable for P500, while C will be liable for P1,500 (P1,000 + P500).

Since the remaining obligation is P2,000 after the renunciation of As share, and

thereafter B becomes insolvent, A and C would have to absorb the debt

corresponding to B in the amount of P1,000. This shall be divided equally by A and

C.

Solidary creditors can collect from some or all of the debtors at one given time. If

the creditor fails to collect from one debtor, he can go against the other or others,

until the whole obligation is paid. It was held that the creditor may sue any of the

solidary debtors or all of them simultaneously. An action instituted against one shall

not a bar to those, which may be subsequently brought against others, as long as

the debt has not been entirely satisfied (Article 1216)

Payment made by one of the solidary debtors extinguishes the obligation. If two or

more solidary debtors offer to pay, the creditor may choose which offer to accept.

He who made the payment may claim from his co-debtors only the share which

corresponds to each, with the interest for the payment already made. If the

payment is made before the debt is due, no interest for the intervening period may

be demanded.

When one of the solidary debtors cannot, because of his insolvency, reimburse his

share to the debtor paying the obligation, such share shall be borne by all his codebtors, in proportion to the debt of each. ( Article 1217)

Note:

In action filed by the creditors, a solidary debtor may avail of the following

defenses:

Defenses derived from the nature of the obligation which

constitute total defenses, such as

- absolute simulated contract

- illegal cause or consideration

- illegal object or subject matter

- non-fulfillment of the suspensive conditions

- other defenses which will nullify the contract which is the basis of

creditors action.

Defenses personal in nature which may constitute a total or

partial defense

- factor which vitiate consent such as minority, insanity, fraud,

violence, intimidation, etc.

a partial defense for the solidary debtor being sued, thus exempting

him from paying the proportionate share of the co-debtor whose

personal defense he is invoking.

He is exempted to pay the

proportionate share of the invoking co-debtor but is still liable of his

share and of those co-debtors whose shares are not in question.

Illustration:

A, B and C are solidary debtors of X in the amount of P30,000. C was insane at the

time the obligation was constituted. What is the legal effect?

* X may collect from either A or C P20,000. Art. 1222 provides that a solidary

debtor may avail himself of the partial defense of the insanity of C. Such defense is

personal to C and would therefore affect only the part of the debt to which C may be

responsible.

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