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CHAPTER 1 1. Real Obligation (obligation to give) – the
GENERAL PROVISIONS
Essential requisites of an obligation:
1. Passive subject (debtor/obligor)
-the person who is bound to perform the prestation
2. Active Subject (creditor/obligee)
-the person who has the power to demand the
prestation
3. Object or prestation (subj. matter of obligation)
-the conduct required to be observed by the debtor
-no prestation; no obligation
4. Juridical or legal tie (efficient cause)
-which binds or connects the parties to the obligation
-it can easily determine by knowing the source of obli
Obligation, right, and wrong distinguished
1. Obligation–the act or performance that the
law will enforce
2. Right – the power that a person has under
the law to demand from another prestation
a. Personal right – right or power of a
person to demand from another for the
fulfillment of the obligation
b. Real right – right or interest of a person
over a specific thing (ownership,
possession)
3. Wrong (cause of action) – act of omission of
one party in violation of a legal right
 Injury– refers to the wrongful
violation of the legal right of another
Kinds of Obligation According To Subject Matter
(1) It can be performed by a third person
subject matter is a thing which the obligor
must deliver to the oblige
(1) Specific real obligation(Art. 1165)
Rights of the creditor:
a. Demand specific performance (if it is
possible) with a right indemnity for
damages; or
b. Demand rescission or cancellation (if it is
impossible) with the right to recover
damages;
c. Demand payment or damages only,
where it is the only feasible remedy.
(2) Generic real obligation – can be
performed by a third person; it is not
necessary for creditor to compel the
debtor to make the delivery or
performance although he can ask for
damages
2. Personal Obligation (obligation to do) – the
subject matter is an act to be done or not to
be done
a. Positive Personal Obligation – to do
Duties of debtor/obligor: (Art. 1167)
(1) To do it
(2) To shoulder the cost if someone else
did it
(3) To undo what has been poorly done
(4) To pay damages (Art. 1170-72,2201-
02)
Right of creditor in case of failure to do:
but at the expense of the debtor plus
damages
(2) If it was poorly done, it may be
ordered by the court to undo it if it is
possible.
b. Negative personal obligation – not to do
Duties of debtor/obligor:
(1) Not to do what should not be done
(2) To shoulder the cost to undo it (Art.
1168)
(3) To pay damages
Note: No delay in negative personal
obligation.
Sources of Obligation
1. Law – imposed by law itself
2. Contracts – arise from stipulations
3. Quasi-contracts – arise from lawful,
voluntary and unilateral acts which are
enforceable to the end that no one shall be
unjustly enriched at the expense of another
a. Negotiorumgestio– unauthorized
voluntary management of the property
or affairs of another
b. Solution indebiti– unduly delivered
through mistake; not a finders keeper
4. Crimes/delicts –arise from criminal offense
Scope of civil liability
1. Restitution-thing itself is restored
2. Reparation for the damage caused;
3. Indemnification for consequential
damages
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5. Negligence/quasi-delicts – arise from
damage caused to another through an act or
omission, there being fault or negligence
Requisites of quasi-delict:
1. There must be an act of omission;
2. There must be fault or negligence;
3. There must be damaged caused;
4. There must be a direct relation or
connection of cause and effect between
the act of omission and the damage; and
5. There is no pre-existing contractual
relation between the parties.
CHAPTER 2
NATURE AND EFFECT OF OBLIGATIONS
A. Specific or determinate thing – particularly
designated or physically segregated others of
the same class and can be identified by its
individuality
Duties of a debtor:
1. Preserve the thing–take care of the thing
like a good father of a family
a. Diligence of a good father of a family
– perform ordinary care (reasonably
prudent)
b. Another standard of care – extra-
B. Generic or indeterminate – when it refers
ordinary diligence; if the law
provides or stipulated
c. Factors to be considered – the
diligence depend upon the nature of
the thing to be delivered (place,
time, or circumstance)
d. Reason for debtor’s obligation –
without the accessory duty to take
care of the thing, the debtor would
not be liable even if the property is
lost or destroyed
2. Delivery of the fruits of the thing – Art.
1164
a. Natural fruits – spontaneous
products of the soil, and the young
and other products of animals (no
human labor like grass, soil)
b. Industrial fruits – produced by lands
of any kind of through cultivation or
labor (fruits)
c. Civil fruits – derived by virtue of a
juridical relation (rents, leases)
3. Delivery of the accession and the
accessories
a. Accessions – additions to or
improvements
b. Accessories – joined to or included
4. Delivery the thing itself –
5. Answer for damages in case of non-
fulfillment
only to a class or genus to which it pertains
and cannot be pointed out with particularity
and it is identified only by its specie
Duties of the debtor:
1. To deliver the thing which of the quality
intended by the parties; the
consideration for the purpose; and other
circumstances
2. To be liable for damages in case of fraud,
negligence, or delay
Genus never perishes –
Ground for liability:
1. Fraud (deceit or dolo) – deliberate or
intentional evasion of normal fulfillment of
an obligation; it implies some kind of malice
or dishonesty and it cannot cover cases of
mistake and errors of judgmental made in
good faith; synonymous to bad faith in that,
it involves a design to mislead or deceit
another
 There is a deliberate intention to
cause damage
 Waiver for future fraud is void
 Waiver for past fraud is valid
 Fraud must be clearly proved
 Liability cannot be mitigated or
reduced
Kinds of fraud:
1. Fraud in execution/creation
(1) Incidental Fraud (dolo incidente) – committed
in the performance of an obligation already
existing because of contract
 Present during the perfection of a
contract
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 Purpose is to secure the consent of
the other party but the fraud was not
the principal inducement in making
the cont.
 Does not result in the vitiation of
consent
 Gives rise to a right of an innocent
party to claim for damages
(2) Casual fraud (dolo causante) – fraud
employed in the execution of a contract
 Present during the perfection of a
contract
 Purpose is to secure the consent of
another to enter into the contract
 Results in vitiation of consent; voidable c.
 Gives rise to a right of an innocent party
to annul the contract
2. Fraud in the performance (Art. 1170)
 Present during the performance of a
pre existing obligation
 Purpose is to evade the normal
fulfillment of the obligation
 Result in the breach of contract
 Gives rise to a right in favor of the
creditor to recover damages
2. Negligence (fault or culpa) – any voluntary
act or omission, there being no bad faith or
malice, which prevents the normal fulfillment
of an obligation
 There is no deliberate intention to
cause damage
 Waiver may, in a certain sense be Types of delay:
allowed
1) Ordinary delay – merely the failure to
 It is presumed from the violation of
perform an obligation on time; no demand
obligation
from creditor yet
 May be reduced according to the
2) Legal delay – the failure to perform an
circumstances
obligation on time which failure constitutes a
Kinds of Negligence acc. to source of obligation breach of an obligation; the creditor already
demanded
1. Contractual negligence (culpa contractual)
- This negligence is not the source of Kinds of Delay
obligation
1) Mora solvendi – delay on the part of the
- It merely makes the debtor liable for
debtor
damages in view of his negligence in the
Effects:
fulfillment of a pre-existing obligation
a. The debtor is guilty of breach or violation
- Negligence in the performance of the
of the obligation;
contract
b. He is liable for interest or damages
2. Civil negligence/tort/quasi-delict (culpa
c. He is liable even for a fortuitous event
aquilana)
2) Mora accipiendi – delay on the part of the
- Negligence is the source of the obligation
creditor
- It constitutes an independent source of
Effects:
obligation between parties not
a. The creditor is guilty of breach or
previously bound
violation of the obligation;
3. Criminal negligence (culpa criminal)
b. He is liable for damages suffered, if any,
- Negligence resulting to a crime
by the debtor
Factors to be considered: c. He bears the risk of the loss thing due
d. Debtor is not liable for interst from the
(1) Nature of the obligation
time of the creditor’s delay
(2) Circumstances of the person
e. The debtor may be released by
(3) Circumstances of the time
cinsignation
(4) Circumstances of the place
4. Delay (mora) – (Art. 1169)
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3) Compensatio morae – reciprocal sale; delay
of obligor cancels the delay of the obligee
and vice v.
Effect:
There is no delay in this situation. Each shall
bear his own damages.
Requisites of Delay by the debtor:
(1) Failure of the debtor to perform his
obligation on the date agreed upon;
(2) Demand (not merely a reminder) made by
the creditor on the due date to the debtor;
and
(3) Failure of the debtor to comply with such
demand
Note: The obligation should be due and
demandable.
When the demand is not necessary to put debtor in
delay
(1) When the obligation so provides:
 without the need of any demand
 the debtor will be in default
 I will be liable for damages
(2) When the law so provides:
 Payment of taxes
 Delivery of the
fruits/accession/accessories
(3) When time is of essence:
 Reasonable time will depend upon
the circumstances of the particular
obligation
(4) When demand would be useless:
 When it is already impossible for the
debtor to perform or deliver the
obligation
(5) When there is performance by a party in
reciprocal:
 Simultaneous performance of the
obligation
 Compensation morae
5. Contravention of the terms of the obligation
– the violation of the terms and conditions
stipulated in the obligation; the
contravention must not due to a fortuitous
event
Meaning of fortuitous events
Fortuitous events – any event which cannot be
foreseen, or which though foreseen, is inevitable
Types of fortuitous events
1. Act by man – event independent of the will
of the obligor but not of human wills (fire,
robbery, war)
2. Act by god (majeure) – events which are
totally independent of every human being
(flood, rain)
Kinds of fortuitous events
1. Ordinary fortuitous events – events which are
common and which the contracting parties
could reasonably foreseen (rain, floods)
2. Extra-ordinary fortuitous events – events
which are uncommon and which the
contracting parties could not have
reasonably foreseen (earthquake)
Rules as to liability in case of fortuitous event:
(1) When expressly specified by law
a. The debtor is guilty of fraud, negligence,
delay, or contravention of the tenor of
the obligation
b. The debtor has promised to deliver the
same (specific) thing to two or more
person who do not have the same
interest
c. The obligation to deliver a specific thing
arises from a crime
d. The thing to be delivered is generic
(2) When declared by stipulation – freedom of
cont.
(3) When the nature of the obligation requires
the assumption of risk – risk of loss or
damage is an essential element in the
obligation
Meaning of simple loan or mutuum
Simple loan – one of the parties delivers to
another, money, or other consumable thing,
upon the condition that the same amount of the
same kind and quality shall be paid; with or
without interest
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Usury – receiving interest in excess of the
amount allowed by the law; for money, goods or
chattel
Requisites for recovery of interest:
 The payment of interest must be
expressly stipulated
 The agreement must be in writing; and
 The interest must be lawful
Presumption – the interference of a fact not actually
known arising from its usual connection with another
which is known or proved
Two kinds of presumption
1. Conclusive presumption – cannot be
contradicted
2. Disputable (rebuttable) presumption – can be
contradicted or rebutted by presenting proof
to the contrary
When presumptions do not apply:
(1) With reservation as the interest
(2) Receipt without indication of particular
instalments paid
(3) Receipt for a part of the principal
(4) Payment of taxes
(5) Non-payment proven
CHAPTER 3
DIFFERENT KINDS OF OBLIGATION
Section 1: Pure and Conditional Obligation
1. Pure obligation – one which is not subject to
any condition and no specific date is
mentioned for its fulfilment and is, therefore,
immediately demandable; demandable at
once
2. Conditional obligation – one whose
consequence are subject in one way or
another to the fulfilment of a condition
 Condition – a future and uncertain
event upon the happening of which,
the effectivity or extinguishment of
an obligation subject to it depends
Characteristics of a condition:
(a) Future and uncertain
(b) Past but unknown
Classification of conditions
A. As to effect
1. Suspensive condition (condition precedent/
antecedent)
 The fulfillment of which will give rise to an
obligation
 If the condition does not happen, the tie of
the law does not appear
 The obligation is a mere hope until the
condition does not happen
Effect: Acquisition of rights
Where suspensive condition depends upon the will
of the debtor:
(a) Conditional obligation void – it cannot be
easily demanded; “I will pay you if I want”
(b) Only the condition is void – the obligation is
imposed not on the birth of the obligation
but on its fulfillment
Where suspensive obligation depends upon the will
of the creditor:
(a) The conditional obligation is valid – it is up to
the creditor whether to enforce his right to
demand or not; “I will pay you upon your
demand”
Constructive fulfillment of suspensive condition:
Requisites:
 The consition is suspensive
 The obligor actually prevents the fulfillment
of the obligation
 He acts voluntarily
2. Resolutory condition (condition subsequent)
 The fulfillment of which will
extinguish the obligation
 Demandable at once
 Law is consolidated
Effect: Loss of rights already acquired
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Where resolutory condition depends upon the will
of the debtor:
(a) The obligation is valid – the position of the
debtor when the condition is resolutory is
exactly the same as that of the creditor when
it is suspensive condition
Constructive fulfillment of resolutory condition
- with respect to the debtor who is bound
to return what he has received upon the
fulfillment of the condition
When obligation is demandable at once:
(1) When it is pure
(2) When it is subject to resolutory condition; or
(3) When it is subject to resolutory period.
Where duration of period depends upon the will of
the debtor:
(1) The debtor promises to pay when his means
permit him to do so
(2) As when the debtor binds himself to pay
“little by little” “as soon as possible” “in
partial payment” “from time to time”
B. As to form
1. Express – the condition is clearly stated
2. Implied – the condition is merely inferred
C. As to possibility
1. Possible – the condition is capable of
fulfillment, legally and physically
2. Impossible – the condition is not capable of
fulfillment, legally and physically
Two kinds of impossible condition
a. Physically impossible conditions – when they,
in nature of things, cannot exist or cannot be
done
b. Legally impossible condition – when they are
contrary to law, morals, gc, po or pp
Effects:
 Condition positive: condition is void
 Condition negative; condition is valid
 Only affected obligation is void
 Only the condition is void
D. As to cause or origin
1. Potestative – the condition upon the will of
one of the contracting parties
2. Casual – the condition upon the chance or
upon the will of the third person
3. Mixed – the condition partly upon chance or
partly upon the will of the third person
E. As to mode
1. Positive – the condition consist in the
performance of an act
The obligation is extinguished when:
a. As soon as the time expires without the
event taking place
b. As soon as it has become indubitable that the
event will not take place although the time
specified has not expired
2. Negative – the condition consist in the
omission of an act
The obligation shall become effective and
binding:
a. From the moment the time indicated has
elapsed without the event taking place
b. From the moment it has become evident that
the event cannot occur, although the time
indicated has no yet elapsed
F. As to numbers
1. Conjunctive – there are several conditions
and all must be fulfilled
2. Disjunctive – there are several conditions and
only or some of them must be fulfilled
G. As to divisibility
1. Divisible - the condition is susceptible of
partial performance
2. Indivisible – the condition is not susceptible
of partial performance
Loss, deterioration or improvement on a
pending condition:
Kinds of loss
(1) Physical loss – when a thing perishes as when
a house is burned and reduced into ashes
(2) Legal loss – when the thing goes out of
commerce or when a thing heretofore
become illegal
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(3) Civil loss – when a thing disappears in such a
way its existence is unknown or even know, it
cannot be recovered
Rules covered:
(1) Loss of thing without debtor’s fault
(2) Loss of thing through debtor’s fault
(3) Deterioration of thing without debtor’s fault
(4) Deterioration of thing through debtor’s fault
(5) Improvement of thing by nature or time
(6) Improvement of thing at expense of debtor
Usufruct – the right to enjoy the use and fruit of
a thing belonging to another
Kinds of obligation according to the person
obliged
1. Unilateral – when only one party is obliged to
comply with a prestation
2. Bilateral – when both parties are mutually
bound to each other; both are debtors and
creditors of each other
SECTON 2: Obligation with a Period
Obligation with a Period – one whose effects or
consequences are subjected in one way or another to
the expiration or arrival of said period or term
Period – future and certain event upon the arrival of
which the obligation subject to it either arises or is
terminated; it may be unknown but it is certain to
happen
Characteristics of a period:
(a) Future event
(b) The arrival of a period does not have a
retroactive effect
(c) A period must be possible
General rule: The period is presumed to benefit both
the debtor and the creditor
Exception:
1. Term is for the benefit of the debtor alone – -
he cannot be compelled to pay prematurely,
but he can, if he desires to do so
2. Term is for the benefit of the creditor alone –
he may demand fulfillment even before the
arrival of the term but the debtor cannot
require him to accept payment before the
expiration of the stipulated period
Computation of terms or period
1. Legal period – year = 12 months; month=30
days
2. Calendar month – period of time running
from the beginning of a certain numbered
days up to the last day of the month
General rule: The court cannot fix the term or period
Exceptions:
1. No period is fixed but a period was intended –
when it can be inferred from its nature and
the circumstances that a period was
intended
2. Duration of the period depends upon the will
of the debtor – (Art. 1180)
Kinds of period or term
A. According to effect
1. Suspensive period (ex die) – the obligation
begins only from a day certain upon the
arrival of period
2. Resolutory period (in diem) – the obligation is
valid up to a day certain and terminates upon
arrival of the period
B. According to source
1. Legal period – when it is provided by law
2. Conventional or voluntary period – when it is
agreed to by the parties (Art. 1196)
3. Judicial period – when it is fixed by the court
(Art 1197)
C. According to definiteness
1. Definite period – when it is fixed or it is
known when it will come (Art. 1193, par 3)
2. Indefinite period – where the period is not
fixed but a period is intended, the court are
usually empowered by law to fix the same
(Art. 1197)
When obligation can be demanded before lapse of
period (Art. 1198)
(1) When debtor becomes insolvent
(2) When debtor does not furnish guaranties or
securities promised
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(3) When guaranties or securing given have been
impaired or have disappeared
(4) When debtor violates an undertaking
(5) When debtor attempts to abscond
SECTION 3: Alternative Obligations
Alternative obligation – wherein various prestations
are due but the performance of one of them is
sufficient as determined by the choice which, as a
general rule, belongs to the debtor; plurality of the
object
Kinds of obligation according to object
1. Simple obligation –there is only one
prestation
2. Compound obligation – two or more
prestations
(a) Conjunctive obligation – several prestations
and all are due
(b) Distributive obligation – two or more
prestations are due
(1) Alternative obligation
(2) Facultative obligation – there is only one
prestation but the debtor may substitute
it
Effect of loss:
a. Before substitution (principal thing is lost) –
fortuitous event: extinguished; fault of the
debtor: damages
b. After substitution (substitute thing is lost) –
fortuitous event: extinguished; fault of the
debtor: damages
c.
General rule: Right of choice is given to the debtor
but it is not absolute
 Impossible
 Unlawful
 Which could not have been the object of the
obligation
Communication of notice that choice has been
made
1. Effect of notice – until the choice is made and
communicated, the obligation remains
alternative
2. Proof and form of notice – the burden of
proving that such communication has been
made upon him who made the choice
SECTION 4: Joint and Solidary Obligations
Kinds of obligations according to number of parties:
1. Individual obligation – one where there is
only one obligor or one oblige
2. Collective obligation – one where there are
two or more debtors and/or creditors. It may
be joint or solidary.
Joint and Solidary Obligations
 Joint Obligation – the whole obligation in to
be fulfilled proportionately by different
debtors and/or is to be demanded
proportionately by different creditors.
(a) There are as many debts as there are debtors
(b) There are many credits as creditors
(c) The debts and/or credits are considered
distinct and separate from one another
(d) Each debtor is liable only for a proportionate
part of debt/credit
Words to indicate joint liability:
Mancomunada, Mancomunadamente, pro rata,
proportionately; “we promise to pay”
 Solidary Obligation – each one of the
debtors is bound to render, and/or each one
of the creditors has a right to demand from
any of the debtors, entire compliance with
the prestation.
 Words to indicate joint liability:
Mancomunada, Mancomunadamente, pro rata,
proportionately; “we promise to pay”
When obligation solidary
Solidary liability is not lightly inferred. There is
solidary liability only when:
(a) The obligation expressly so states; or
(b) The law requires solidarity; or
(c) The nature of the obligation requires
solidarity.
 It refers to the juridical or legal tie
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 All solidary debtors are liable for the
breach of the obligation committed by a
debtor.
 There must be at least two debtors or
two creditors
 Other debtors are proportionately liable
Note: Solidary liability also exists when it is
imposed in a final judgement against several
defendants.
 Words to indicate solidary liability:
Joint and/or severally; solidaria; in solidum; together
and/or separately; individually and/or collectively;
juntos o separadamente; “I promise to pay”
Kinds of solidarity:
According to the parties bound:
Passive solidarity – solidarity on the part of the
debtors, where anyone them of them made liable for
the fulfillment of the entire obligation. It is in the
nature of a mutual guaranty.
Active solidarity – solidarity on the part of the
creditors, where anyone of them can demand and
the fulfillment of the entire obligation.
Mixed solidarity – solidarity on the part of the
debtors and creditors, where each one of the debtors
is liable to render and, and each one of the creditors
has a right to demand, entire compliance with the
obligation.
According to source:
Conventional solidarity – where solidarity is agreed
upon by the parties. If nothing is mentioned in the
contract relating to solidarity, the obligation is only
joint.
Legal solidarity – where solidarity is imposed by the
law.
 Agent has exceeded his authority, the
principal is solidary liable with the agent if
the former allowed the latter to act as
though he had full powers.
 All partners are solidary liable with the
partnership for any crime or quasi-delict
committed by any partner acting in the
ordinary course of business.
 When there are two or more bailees to
whom a thing is loaned in the same contract,
they are liable solidary.
 The responsibility of two or more payees
where there has been a payment of what is
not due, is solidary.
 The responsibility of two or more persons
who are liable for a quasi-delict is solidary.
 Constructions firms/contractors are solidarily
liable for damages of any defects in the
construction.
 In a felony
Real solidarity – where solidarity is imposed by
nature of the obligation.
Effects of payment by a solidary debtor:
1. Between the solidary debtors and creditors –
payment made by one of the solidary
debtors extinguishes the obligation
2. Among the solidary debtor – after payment
of the debt, the paying solidary debtor can
demand extinguishes an obligation, the law
refers to payment in full.
3. Among solidary creditors – the receiving
creditor is jointly liable to the other for their
corresponding shares.
Effects of payment after obligation has prescribed
or become illegal:
Prescription – one acquires ownership and other
rights through the lapse of time in the manner and
under the condition laid down by law.
 Prescribed dates
 10 yrs
 Written contract
 Obligation created by law
 Judgmental
 6 yrs
 Oral contract
 Quasi-contract
 4 yrs
 Injury to the rights of the
plaintiff
 Quasi-delict
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Kinds of solidary obligation according to the legal 3. Ideal or intellectual division – exists only in
tie: the minds of the parties
1. Uniform – when the parties are bound by the
Kinds of indivisibility
same stipulations.
2. Non-uniform or variea – when the parties Legal indivisibility – where a specific provision of law
are not subject to the same stipulations. as indivisible, obligations which by their nature,
Complete defense – defense derived from the nature
of the nature of the obligation, it nullifies the
obligation or renders in ineffective. Other examples
are fraud, prescription, remission, illegality, or
absence of consideration, res judicita, non-
performance of a suspensive condition, etc.

Partial defense – non-fulfillment of the condition.

Divisible obligation – is one the object of which, in

which in its delivery or performance, is capable of
partial fulfillment.

Indivisible obligation –is one the object of which, in

which in its delivery or performance, is not capable of
partial fulfillment.

 Refers to the prestation

 Only the debtor guilty of the breach of the
obligation is liable for damages
 It can exist although there is only one debtor
and one creditor
 Other debtors are not liable in case of
insolvency

Kinds of division:
1. Qualitative division – based on quality
2. Quantitative division – based on quantity