8 – PURE AND CONDITIONAL OBLIGATIONS (2)

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Article 1183. Impossible conditions, those contrary to good customs or public policy and those
prohibited by law shall annul the obligation which depends upon them. If the obligation is
divisible, that part thereof which is not affected by the impossible or unlawful condition shall be
valid.
The condition not to do an impossible thing shall be considered as not having been agreed upon.
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Article 1183 refers to suspensive conditions. It applies only to cases where the impossibility
already existed at the time the obligation was constituted. If the impossibility arises after the
creation of the obligation, Article 1266 governs.

Two kinds of impossible conditions:

(1) Physically impossible conditions – when they, in nature of things, cannot exist or cannot be
done

Example:

“I will pay you Php 10,000.00 if it will not rain for one year in the Philippines.”

(2) Legally Impossible conditions – when they are contrary to law, morals, good customs, public
order, or public policy

Example:

X will give Y Php 10,000.00 if Y—

-will kill Z (against the law)
-will be the common-law wife of X (against morals)
-will slap his father (against good customs)
-will publicly advocate the overthrow of the government (against public order)

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Article 1184. The condition that some event happen at a determinate time shall extinguish the
obligation as soon as the time expires or if it has become indubitable that the event will not take
place.
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(indubitable – impossible to doubt; unquestionable)

The above article refers to positive (suspensive) condition---the happening of an event at a

determinate time.

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Example:

X obliges himself to give B Php 10,000.00 if B will marry C before B reaches the age of 23.

(a) X is liable if B marries C before he reaches the age of 23.

(b) X is not liable if B marries C at the age of 23 or after he reaches the age of 23.
(c) If B dies at the age of 22 without having married C, the obligation is extinguished because it
has become indubitable that the condition will not take place.

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Article 1185. The condition that some event will not happen at a determinate time shall render
the obligation effective from the moment the time indicated has elapsed, or if it has become
evident that the event cannot occur.
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The above provision speaks of a negative condition---that an event will not happen at a
determinate time.

Example

X binds himself to give B Php 10,000.00 if B is not yet married to C on December 30.

(a) X is not liable to B if B marries C on December 30 or prior thereto.

(b) X is liable to B if on December 30, B is not married to C and if B marries C after December
30.
(c) Suppose C dies on November 20 without having been married to B. The condition is rendered
effective because it is certain that the condition not to marry C will be fulfilled. In this case,
the obligation becomes effective from the moment of C’s death on November 20 although the
time indicated (December 30) has not yet elapsed.

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Article 1186. The condition shall be deemed fulfilled when the obligor voluntarily prevents its
fulfillment.
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Three requisites for the application of this article:

(1) The condition is supensive;

(2) The obligor actually prevents the fulfillment of the condition; and
(3) He acts voluntarily.

The law does not require that the obligor acts with malice or fraud as long as his purpose is to
prevent the fulfillment of the condition. He should not be allowed to profit from his own fault or
bad faith.

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Example:

X agreed to give Y a 5% commission if the latter could sell the former’s land at a certain price. Y
found a buyer who definitely decided to buy the property upon the terms prescribed by X. To
evade the payment of the commission agreed upon, X himself sold to the buyer the property at a
lower price without the aid of Y.

In this case, it can be said that the due performance by Y of his undertaking, the condition for the
payment of the commission, was purposely prevented by X, and is deemed fulfilled.

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Article 1187. The effects of a conditional obligation to give, once the condition has been
fulfilled, shall retroact to the day of the constitution of the obligation. Nevertheless, when the
obligation imposes reciprocal prestations upon the parties, the fruits and interests during the
pendency of the condition shall be deemed to have been mutually compensated. If the obligation
is unilateral, the debtor shall appropriate the fruits and interest received, unless from the nature
and circumstances of the obligation it should be inferred that the intention of the person
constituting the same was different.

In obligations to do and no to do, the courts shall determine, in each case, the retroactive effect
of the condition that has been complied with.
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(1) In obligations to give

Example:

On January 20, S agreed to sell his parcel of land to B for Php 50,000.00 should B lose a case
involving the recovery of another parcel of land. On April 10, S sold his land to C. B lost the
case on December 4.

Before December 4, B had no right to demand the sale of the land by S. When the condition,
however, was fulfilled on December 4, it is as if B was entitled to the land beginning January 20.
Hence, as between B and C, B will have a better right over the land.

(2) In obligations to do or not to do

Example:

C obliged himself to condone the debt of D, his lawyer, should the latter win C’s case in the
Supreme Court.

In this case, upon the fulfillment of the condition,C shall not be entitled, unless the contrary has
been stipulated, to the earned interests of the capital during the pendency of the condition as the

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intention of C is to extinguish the debt. Here the fulfillment of the condition has a retroactive
effect.

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Article 1188. The creditor may, before the fulfillment of the condition, bring the appropriate
actions for the preservation of his right.
The debtor may recover what during the same time he has paid by mistake in case of a
suspensive condition.
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Article 1189. When the conditions have been imposed with the intention of suspending the
efficacy of an obligation to give, the following rules shall be observed in case of the
improvement, loss or deterioration of the thing during the pendency of the condition:

(1) If the thing is lost without the fault of the debtor, the obligation is extinguished;
(2) If the thing is lost through the fault of the debtor, he shall be obliged to pay damages; It is
understood that the thing is lost when it perishes, or goes out of commerce, or disappears in
such a way that its existence is unknown or it cannot be recovered;
(3) When the thing deteriorates without the fault of the debtor, the impairment is to be borne by
the creditor;
(4) If it deteriorates through the fault of the debtor, the creditor may choose between the
rescission of the obligation and its fulfillment, with indemnity for damages in either case;
(5) If the thing is improved by its nature, or by time, the improvement shall inure to the benefit
of the creditor;
(6) If it is improved at the expense of the debtor, he shall have no other right than that granted to
the usufructuary.
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(inure – came into operation; take effect)

(usufruct – the right of enjoying a thing, the property of which is vested in another, and to draw
from the same all the profit, utility and advantage which it may produce, provided it be without
altering the substance of the thing)

Requisites for the application of Article 1189:

(1) The obligation is a real obligation

(2) The object is a specific or determinate thing;
(3) The obligation is subject to suspensive conditions;
(4) The condition is fulfilled; and
(5) There is loss, deterioration, or improvement of the thing during the pendency of the
condition.

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Kinds of loss in civil law:

(1) Physical loss – when a thing perishes as when a house is burned and reduced to ashes;
(2) Legal loss – when a thing goes out of commerce (e.g. a product becomes obsolete) or when a
thing heretofore legal becomes illegal (e.g., during the Japanese occupation, American
dollars had become impossible since their use was forbidden by the belligerent occupant); or

(3) Civil loss – when a thing disappears in such a way that its existence is unknown (e.g., a
particular dog has been missing for some time); or even if known, it cannot be recovered,
whether as a matter of fact (e.g., a particular ring is dropped from a ship at sea) or of law
(e.g., a property is lost through prescription).

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Article 1190. When the conditions have for their purpose the extinguishment of an obligation to
give, the parties, upon the fulfillment of said conditions, shall return to each other what they have
received.
In case of loss, deterioration or improvement of the thing, the provisions which, with respect to
the debtor, are laid down in the preceding article shall be applied to the party who is bound to
return.
As for obligations to do and not to do, the provisions of the second paragraph of Article 1187
shall be observed as regards the effect of the extinguishment of the obligation.
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Example:

X allows Y to use the former’s car until X returns from the province. Upon the return of X from
the province, Y must give back the car. The effect of the happening of the condition is to annul
the obligation as if it had never been constituted at all. In this case, the parties intend the return
of the car.

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Article 1191. The power to rescind obligations is implied in reciprocal ones, in case one of the
obligors should not comply with what is incumbent.

The injured party may choose between the fulfillment and the rescission of the obligation, with
the payment of damages in either case. He may also seek rescission, even after he has chosen
fulfillment, if the latter should become impossible.

The court shall decree the rescission claimed, unless there be just cause authorizing the fixing of
a period.

This is understood to be without prejudice to the rights of third persons who have acquired the
thing, in accordance with Articles 1385 and 1388 and the Mortgage Law.
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Kinds of obligation according to the person obliged:

(1) Unilateral – when only one party is obliged to comply with a prestation.

Example: Donation

(2) Bilateral – when both parties are mutually bound to each other. Both parties are debtors and
creditors of the other.

(a) Reciprocal obligations are those which arise from the same cause and in which each party
is a debtor and creditor of the other, such that the performance of one is designed to be the
equivalent and the condition for the performance of the other.

Example:

In a contract of sale, in the absence of any stipulation , the delivery of the thing sold by the
seller is conditioned upon the simultaneous payment of the purchase price by the buyer, and
vice versa.

(b) None-reciprocal obligations are those which do not impose simultaneous and correlative
on both parties. In other words, the performance of one party is not dependent upon the
simultaneous performance by the other.

Example:

X borrowed from Y Php 5,000.00. Y on the other hand, borrowed X’s car. The performance
by X of his obligation to Y is not conditioned upon performance by Y of his obligation and
vice versa.

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Article 1192. In case both parties have committed a breach of the obligation, the liability of the
first infractor shall be equitably tempered by the courts. If it cannot be determined which of the
parties first violated the contract, the same shall be deemed extinguished, and each shall bear his
own damages.
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(infractor – violator; breaker)

Example:

S sold his TV set to B. The agreement is that the set shall be delivered on October 1 at the house
of B and payment shall be made by B upon delivery. S did not deliver the set on October 1 in
spite of a demand made by B. Five days later, S delivered the set but B incurred in delay in
paying the purchase price.

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In a suit between S and B, the liability of S for damages should be equitably tempered by the
court, taking into consideration the breach also of the obligation on the part of B.

If both alleged that the other was the first infractor and the court cannot determine who of the
two is telling the truth, the contract shall be deemed extinguished and each shall bear his own
damages. This means that the contract shall not be enforced.

Reference: The Law on Obligations and Contracts 2011

by H. S. De Leon and H. M. De Leon, Jr.

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