COURSE SYLLABUS

THE LAW ON OBLIGATIONS

AND CONTRACTS
GORDON COLLEGE
2nd Semester, AY 2019-2020
Pros. RITCHIE JOHN DISTOR BOLAÑO

COURSE DESCRIPTION

A study of the concepts of law in general. It covers (a) obligations,

their nature, elements, sources, classification, effects and modes
of extinction; and (b) contracts, their nature, elements, effects,
form, interpretation, rescission, nullity, annulment and
enforcement.

COURSE OBJECTIVES

At the end of the semester the students are expected:

 To gain knowledge of the legal provisions governing business

transactions in general, and the law on obligations and
contracts in particular;

 To prepare the students for advance studies on business law;

 To develop analytical skills of applying the law on obligations

and contracts on certain situations or business transactions.

COURSE OUTLINE

I. Introduction to Law
II. General Provisions on Obligation
III. Nature and Effect of Obligations
IV. Different Kinds of Obligations
V. Extinguishment of Obligations
VI. General Provisions on Contract
VII. Essential Requisites of Contracts
VIII. Forms of Contract
IX. Reformation of Instruments
X. Interpretation of Contracts
XI. Rescissible Contracts
XII. Voidable Contracts
XIII. Unenforceable Contracts
XIV. Void or Inexistent Contracts
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REQUIRED TEXT
De Leon, Hector S. The Law on Obligations and Contracts. Latest
Edition, Rex Bookstore.

COURSE REQUIREMENTS

Midterm examination : 30%;

Class Participation : 40%
Final Exam : 30%
Total 100%

A. READ, TAKE NOTES AND ASK QUESTIONS. This course

requires much reading and the student is expected to have read
the required materials when coming to class.

B. EXAM. The exam will consists of problem-solving and short

answer questions based on the class lectures and the assigned
reading materials.

C. FINAL EXAM. Comprehensive of all lectures and selected

required reading materials.

D. There will be GRADED RECITATION (50% of final grade)

based on the required reading materials and assigned cases.

CLASSROOM POLICIES

1. Students must submit a 3x5 index card with their names,

courses, contact numbers, 1x1 ID color by the second-class
meeting.
2. A student is considered absent from class if s/he is not present
within the first third fraction (30 minutes) of the scheduled
class time. The students should be responsible for keeping
tracks of their absences.
3. As a courtesy of the entire class, smoking and eating inside the
classroom shall be strictly prohibited. All electronic devices
must be either deactivated or at least silent.

COURSE SCHEDULE AND READING MATERIALS

SESSION 2
Topics to be discussed:

Introduction to Law
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a. Concepts and Definition;

b. Kinds, Classification and Divisions
c. State Law
d. Definition: Law on Obligations and Contracts

General provisions on Obligations

1. Definition of Obligation (Art. 1156, NCC)
2. Essential Requisites of Obligation
3. Natural Obligations (Arts. 1423-1430, NCC)
4. Concepts and Sources of Obligations (Arts. 1157-
1162, NCC)
4.1 Law (Art. 1158)
4.2 Contracts (Art. 1159)
4.3 Quasi-contracts (Art. 1160, NCC) – Definition;
kinds
4.4 Crimes or delict (Art.1161, NCC) – Scope of
liability
4.5 Quasi-delict (Art. 1162, NCC)—Definition;
Crimes vs. Quasi delict
5. Concepts of obligor and oblige

SESSION 3

Nature and Effect of Obligations

a. Rights of Creditor and Duties of Debtor

a.1. Obligation to give (Arts. 1163-1166, NCC)
a.2. Obligation to Do (Art. 1167, NCC)
a.3. Obligations not to do (Arts. 1168)

b. Grounds for liability for damages (art.1170, NCC)

b.1. Delay (Art. 1169, NCC) – Definition; Kinds; Effects;
Rule and Exceptions (When demand is not necessary to
put debtor in delay)
b.2 Fraud (Art. 1171) – Definition; Kinds
b.3 Negligence (Arts. 1172-1173, NCC) – Definition; kinds;
Negligence vs. Diligence; Kinds of diligence
b.4 Contravention of the tenor of the obligation (Art. 1170,
NCC) – Meaning
b.5 Fortuitous event (Art. 1174, NCC) – Definition; kinds;
requisites; rule and Exceptions
c. Usurious transactions (Art. 1175, NCC) – Meaning of Loan or
Mutuum
d. Presumptions (Art. 1176, NCC) – Definition; Kinds; When not
applicable
e. Remedies available to creditors for the satisfaction of their
claims (Art. 1177, NCC)
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f. Transmissibility of rights (Art. 1178, NCC) – Rule and

Exceptions

SESSION 4

NATURE AND EFFECTS OF OBLIGATION

Different kinds of obligations

a. Secondary Classifications under the Civil Code

a.1. Unilateral vs. bilateral (Arts. 1168-1169, NCC)
a.2. Real vs. Personal (Arts. 1163-1168, NCC)
a.3 Determinate vs. Generic (art. 1165, NCC)
a.4 Civil vs. Natural (Art. 1423, NCC)
a.5 Legal, Conventional and Penal (Arts. 1157, 1159,
1161, NCC

b. Primary Classifications under the New Civil Code

b.1 Pure and Conditional (Arts. 1179-1192)
b.2. Obligations with a period (Arts. 1180, 1193-1198,
NCC)
b.3. Alternative vs. Facultative Obligations (Arts.
1199-1206, NCC)
b.4. Joint and Solidary Obligations (Art. 1207-1222,
NCC)
b.5. Divisible vs. Divisible Obligations (Arts. 1223-
1225, NCC)
b.6 Obligations with a Penal Clause (Arts. 1126-1304,
NCC)
SESSION 6

Extinguishment of Obligations (Art. 1231, NCC)—Cause of

Extinguishment not under Art. 1231.

1. Payment or performance (Art. 1232-1254)

1.a. Payment by Cession (Art. 1255)
1.b. Tender of payment and consignation (Arts. 1256
-1261, NCC)
2. Loss of the thing due (arts. 1262-1269, NCC)
3. Condonation or remission of debt (Arts. 1270-1274)
4. Confusion or merger of rights (Arts. 1275-1277, NCC)
5. Compensation (Arts. 1278-1304, NCC)
6. Novation (Arts. 1291-1304, NCC)
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SESSION 7

CONTRACTS

1. Definition (Art. 1305, NCC), Nature and Concepts

2. General Provisions (Arts. 1306-1317, NCC)
3. Essential requisites of Contracts (Art. 1318, NCC)
a. Consent (Arts. 1319-1346)
b. Object (Arts. 1347-1349, NCC)
c. Cause (Arts. 1350-1355,NCC)

SESSION 8

4. Form of Contracts (Arts. 1356-1358)

5. Reformation of Instruments (Arts. 1359-1369)
6. Interpretation of Contracts (Arts. 1370-1379)

SESSION 9

Defective Contracts under the Civil Code:

Rescissible Contracts (Arts. 1380-1389, NCC)

Meaning: Rescissible Contract
Rescission: Definition, requisites, nature and extent,
period for filing, persons entitled to bring action
Payments made in state of insolvency
When alienation presumed in fraud of creditors (Art.
1387, NCC)

SESSION 10

MIDTERM EXAM

SESSION 11

Voidable Contracts (Arts. 1390-1402, NCC)

Definition, nature and effects
Annulment: Meaning and the period for filing action for
annulment; persons entitled and those not entitled to
filing such actions; extinguishment of action for
annulment
Ratification: definition; requisites; effects; persons who
can ratify
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SESSION 12

Unenforceable Contracts (Art. 1403-1408, NCC)

Meaning; kinds
Unauthorized contracts: definition
Agreements within the scope of the statute of frauds
Modes of ratification under the statute of frauds
When unenforceable contract becomes a voidable
contract

When unenforceable contract becomes a valid contract

Right of third persons to assail an unenforceable
contract

SESSION 13

Void or Inexistent Contracts (Arts. 1409-1422, NCC)

Meaning, characteristics
Instances of void or inexistent contracts
Rules where contract is illegal and the act constitutes a
criminal offense

Rules where contract is illegal but the act does not constitute
a criminal offense

Persons entitled to raise defense or illegality or nullity.

Definition of in pari delicto

SESSION 14

FINAL EXAM