CIVIL LAW REVIEW 2 | CGA AKO

OBLIGATIONS & CONTRACTS In contracts, one of the elements is OBJECT; the

word “object” there has the same definition as
that of the object in PROPERTY
A. OBLIGATIONS. For an obligation to be considered as VALID, the
object as an element of the obligation, should
DEFINITION OF OBLIGATION be: (DULAP)
A JURIDICAL necessity to give, to do, or not to do. 1. DETERMINATE
2. USEFUL
The word “juridical” distinguishes a civil obligation from 3. LAWFUL
a moral obligation. In case of non-compliance, there will 4. ASSESSIBLE IN MONEY
be legal sanctions. You can go to court and ask for 5. POSSIBLE
specific performance When we connect obligation with contracts, if
the object is unlawful, then the contract will be
In a natural obligation, it is no longer a civil obligation. considered VOID.
If the debtor voluntarily performs the obligation, he
may no longer demand the return of what was given by 3. JURIDICAL TIE
him. It means that if there is non-performance, then you can
go to court and file an action for specific performance
Examples of moral obligations in the Civil Code
DIFFERENT TYPE OF OBLIGATIONS
When one tenders a payment where in fact, he is no A. ACCORDING TO THE PECULIARITIES OF THE
longer legally have on obligation to do it, he cannot PRESTATION
anymore demand for the return because it falls under 1. Pure
the definition of a NATURAL OBLIGATION. 2. Obligation with A Condition
3. Obligation with A Period
In a MORAL OBLIGATION, it is similar to that of a natural
obligation. In case of non-performance of the B. OBLIGATION ACCORDING TO NUMBER OF
obligation, you cannot go to court and file an action for PARTIES
specific performance. (Ex: For Catholics, it is their 1. Joint
obligation to hear Mass every Sunday) 2. Solidary

ELEMENTS OF AN OBLIGATION C. ACCORDING TO NUMBER OF PRESTATIONS TO

BE RENDERED
1. PARTIES 1. Individual
a. Active subject – the CREDITOR/OBLIGEE; the 2. Multiple
one who can demand the fulfillment of the a. Alternative
prestation b. Facultative
b. Passive subject – the DEBTOR/OBLIGOR; the
one bound to perform the prestation D. ACCORDING TO THE QUALITY OF THE OBJECT
1. Positive of Negative
2. OBJECT 2. Specific or Generic
It refers to the PRESTATION (to give, to do, or a. Specific – a determinate object
not to do) which is the conduct to be performed b. Generic – an indeterminate object
by the passive subject/ debtor. 3. Divisible or Indivisible
In so far as property is concerned, object refers a. Divisible – there can be partial performance
to the thing of the obligation
b. Indivisible- it cannot be partially performed

Page 1 of 10
 CIVIL LAW REVIEW 2 | CGA AKO
4. Principal or Accessory
a. Principal – obligation arising from the
principal contract
b. Accessory – obligation arising from the
accessory contract
Example of a principal contract is SIMPLE
MUTUUM, the obligation to pay is the principal
obligation
An example of an accessory contract to that
simple mutuum is it will be guaranteed by a
PLEDGE
SOURCES OF AN OBLIGATION (Art. 1157)
1. LAW
Examples:
a. Obligation to support (Family Code)
b. Payment of taxes
2. CONTRACT
3. QUASI-CONTRACT
a. Negotiorum Gestio – it considered as a quasi-
contract because the partied do not have a
meeting of the minds; there was no consent by
one of the parties and yet because one
benefitted out of the acts of another, the
person who gained benefit has the obligation to
pay for damages; this refers to managing the
property of another person without the consent
of the owner (Ex: When your neighbor’s house
is on fire and you save it)
b. Solution Indebiti – unjust enrichment (Ex: If you
get something that does not belong to you at
the expense of another person)
4. DELICT
5. QUASI-DELICT
Q: Can you file an independent civil action without
making any reservation?
Always go back to the sources of obligation. Articles 29,
30, 31, 35 and 32, 33, 34, 21, 77 of the CC. You have to
connect it with Article 100 of RPC, Sec 1, Rule 111 of the
Rules of Court
If you will go back to Art. 29, 30, 31 and 35 of the CC,
these provisions refer to OBLIGATIONS ARISING FROM A
Page 2 of 10
DELICT which is one of the sources of an obligation.
Article 100 of the RPC confirms that.
Article 100 of the RPC: “A person who is criminally liable
is civilly liable.”
In a libel case, in addition to the criminal case for libel,
he was asking for damages. One single act which is
defined as a crime will also give rise to DAMAGES, which
is a CIVIL OBLIGATION. That is why under the
Sec.1, Rule 111 of the Rules of Court: if you file a
criminal case, the civil case is deemed instituted.
It is very practical because this is a civil liability arising
from a delict. But that is NOT mandatory, that is simply
a GENERAL RULE.
The following are the EXCEPTIONS:
a. If the civil action was filed ahead of the criminal
action
b. If there is a waiver in filing of a civil action
c. If there is a reservation in filing an independent
civil action
If the OBLIGATION ARISES FROM A LAW,
CONTRACT, QUASI-CONTRACT, OR QUASI-
DELICT – YES, one can file an independent civil
action without making any reservation (Ex. Art.
32, 33, 34, 21, 77 of the CC)
But if the OBLIGATION ARISES FROM DELICT, in
accordance with Sec. 1, Rule 111 of the ROC,
together with Art. 100 of the RPC, you have to
make a RESERVATION before you can file an
independent civil action.
When do you have to make the reservation to file
an independent civil action when you are talking
of a civil liability arising from a delict?
You make a reservation BEFORE the prosecution
presents evidence. You make a manifestation to the
judge.
If the accused dies in a criminal case, will the civil
liability arising from the delict also be
extinguished?
The relatives of the victim may still pursue the civil
liability but it will now be based on the other
sources of an obligation.
 CIVIL LAW REVIEW 2 | CGA AKO
In criminal law, an act can only be considered as a
crime if it defined as a crime in the RPC or any
special penal law. Among these sources, what can
be an act that at the same time it can be a delict. It
cannot be arising from law, contract, quasi-contract.
It MAY arise from a QUASI-DELICT. What is one
important element of quasi-delict? –NEGLIGENCE.
Example of a criminal act where there is an element
of negligence: Reckless imprudence resulting to
homicide or serious physical injury. So, if the
accused died in a case like this, the civil liability
arising from that delict is extinguished BUT the
relatives of the victim may still file a civil action for
damages BUT this time treating the act not as a
delict but as a quasi-delict. In this case, the accused
will be substituted by his ESTATE as the
DEFENDANT.
If there is already a civil action deemed instituted in
the criminal action, and the accused did not die, you
just pursue that. But you do not have to file another
action, this time, treating the act as a quasi-delict.
That would be tantamount to double recovery
which is unjust enrichment against the accused.
What are the duties of the obligor?
I. OBLIGATION TO GIVE
A. Obligation to give a SPECIFIC THING
1. Deliver the determinate thing
Ex. Borrowing the notes of your classmates. You have to
return the same notes because it is a specific thing
GENERAL RULE: The debtor of a thing CANNOT compel
the creditor to receive a different one
a. by agreement or consent the debtor may
deliver a different thing or perform a
different prestation in lieu of that stipulated
b. waiver or defect – the creditor with
knowledge of defect, the creditor accepts
the thing without protest or disposes it
If you borrow 50 pesos, you don’t have to
return the same 50-peso bill. This is a contract
of SIMPLE MUTUUM. In this contract, the object
involved is a tangible and generic property.
2. To preserve the thing with the diligence of a
good father of a family would require
Exceptions:
Page 3 of 10
a. COMMON CARRIERS - The obligation is to
observe extraordinary diligence in the
DELIVERY OF GOODS under Art. 1733
b. COMMON CARRIERS - Under Art. 1755, the kind
of diligence required is utmost diligence
(parang mas mataas pa sa extraordinary) when
it comes to the SAFETY OF THE PASSENGERS
c. INN KEEPERS – Under Art. 2000 -more than an
ordinary diligence in the case of necessary
deposit
d. BANKS- to treat the deposit accounts with the
highest degree of care
e. The LAW or the STIPULATION of the parties
requires another standard of care under Art.
1163
GR: Parties may stipulate on the degree of
diligence to be observed.
Exceptions: Art. 2003 (necessary deposit),
common carrier with respect to the safety of
the passenger under Art. 1757)
For example, if you borrow the notes and you
do return them in a bad condition, your
classmate may demand for damages because
aside from the obligation to return the specific
or determinate thing, you also have the
obligation to preserve the notes with the
diligence of a GFF.
3. Delivery of accessions and accessories
ACCESSION is anything that is:
a. Attached – the criteria is if there is attempt to
remove it, it will cause injury
b. Produced
c. Incorporated
In property, if I want to drink from a bottled
water and I remove the cap, it does not destroy
the bottle. There is no accession here. Although
it is attached, it does not cause injury when
removed.
In an eraser, there is a foam and a board. If you
detach the board, it will cause injury. Therefore,
there is an accession.
If originally, the obligation is to deliver the
foam, and then someone attaches a board to
the foam to form an eraser, what happens?
 CIVIL LAW REVIEW 2 | CGA AKO
In property, if there are two personal properties
put together, and but the identity is retained, it
is an ADJUNCTION.
So, if the identity is retained and the removal
will cause the injury, who will have the better
right? What is the principal part, is it the foam
or the board? The first rule is IMPORTANCE. The
FOAM is the principal in an eraser. Therefore,
you have the obligation to deliver the entire
property because there was already an
accession. This is an accession involving a
PERSONAL PROPERTY
In an accession involving a REAL PROPERTY
(Accession Continua – accession natural,
accession industrial) DFA, CIA
If what will be delivered is an apartment which is for
lease- aside from the apartment, the rentals derived
from the apartment would also have to be included
because rentals are CIVIL FRUITS.
If what will be delivered is a lot with fruit-bearing trees,
you have to include the fruit-bearing trees because they
are accessions.
If you bought a dog and the dog is pregnant, are the
puppies included when you deliver the dog? The CC
provides that you deliver the accessions and accessories
to the obligee, provided they were attached at the time
the obligation to deliver arises.
2 Meaning of Accessories in Property:
a. Accessory per se – refers to an ornament (may
be removed without causing injury – make-up,
headband)
b. Accessory as to a principal – there is an
accession; it cannot be detached without
causing injury (if you remove the lens from
eyeglasses)
If there is an obligation to give water and the water is
mixed with juice, it cannot be anymore separated. This
accession is CONFUSION. The identity of the properties
disappear.
Page 4 of 10
In SPECIFICATION, cloth is sewn into a shirt – there is an
obligation to deliver the shirt because there is an
accession.
B. Obligation to Give A Generic or Indeterminate
Thing
GENERAL RULE: To deliver a thing which is neither of
superior nor inferior quality / quality specified.
There is NO obligation to deliver accessories/accessions.
II. OBLIGATION TO DO
You just simply have to perform the act that was
promised and NOT substitute it. If you cannot do it, you
can ask someone else to execute the act at your own
expense. This will NOT apply if the qualities of the
obligor as considered.
III. OBLIGATION NOT TO DO
a. Not to do what should not be done
b. To shoulder the cost to undo, what should not
have been done
c. To pay damages
If the debtor does what has been forbidden, it
has to be undone at the expense of the debtor
with payment of damages.
NOTE: The diligence of a GFF, the delivery of accessories
and accessions are ONLY applicable in a PRESTATION TO
GIVE.
DELAY (MORA)
- In an obligation arising from CONTRACT
- If it is an obligation arising from law – payment
of income tax; there is a penalty if you don’t pay
on time.
- Failure to perform an obligation in due time
KINDS OF DELAY
1. Mora Solvendi – delay on the part of the debtor
by not performing his obligation after a
DEMAND or SPECIFIED TIME
2. Mora Accipiendi – delay in the performance
based on the omission by the creditor of the
necessary cooperation, especially acceptance
on his part
 CIVIL LAW REVIEW 2 | CGA AKO
3. Compensation Morae – delay on the part of
BOTH the debtor and creditor\
GENERAL RULE: No demand, no delay
EXCEPTIONS:
1. If the obligation (contract or law) expressly
declares it
Examples:
- Contract of lease – “Rental should be paid on
the 15th of every month WITHOUT NEED OF
DEMAND”)
- When the law expressly so demands - Payment
of income tax on or before April 15th
2. When time is a controlling motive for the
establishment of the contract (time is of the
essence)
Examples:
- Bar lectures (should be completed before the
bar)
3. When demand would be useless
- by some act of fault of the debtor
- impossibility caused by fortuitous event
DELAY IN RECIPROCAL OBLIGATIONS
At the moment when one of the parties fulfilled his
obligation then there is delay on the part of the other
party
Example:
- If you order food, when you give payment,
there is no longer a need to demand for the
other party to deliver the food
FORTUITOUS EVENT
GENERAL RULE: In case of a fortuitous event, the
obligation is extinguished.
REQUISITES TO RELIEVE OBLIGOR FROM ANY
LIABILITY:
1. INDEPENDENT of the human will
2. Impossible to foresee or even if it can be
foreseen, it cannot be avoided
3. Because of the fortuitous event, it becomes
IMPOSSIBLE for the debtor to perform the
obligation in a normal way.
Page 5 of 10
4. Debtor has NO concurrent fault; he was NOT IN
DELAY or he was NOT NEGLIGENT
EXCEPTIONS THAT INSPITE OF A FE, DEBTOR IS STILL
LIABLE
1. If there is a law that expressly provides for it.
a. Art. 1942 (Liability of a bailee in a contract of
commodatum – bailee/borrower can still be
held liable in spite of the happening of a FE)
b. Art. 2001 – the thief or a robber (necessary
deposit; except in the use of arms)
c. Art. 2147 - Officious manager in a partnership
2. Expressly stipulated by the parties (only in
obligation arising from contract)
3. Art. 1717 and Art. 1724 - Assumption of risk
4. Debtor in delay
5. Debtor guilty of negligence or fault
REMEDIES UPON BREACH OF OBLIGATION
1. PRESTATION TO DELIVER A SPECIFIC THING
a. Specific performance plus damages
b. Action for rescission plus damages
2. PRESTATION TO DELIVER A GENERIC THING
Ask someone else to fulfill the obligation. File an action
for substituted performance plus damages (Art. 1165)
3. PRESTATION TO DO
a. A third person can perform an obligation to do
except when the quality of the debtor is
considered; the act is personal to him (the
remedy may be action for damages)
b. If it was performed unproperly. The debtor can
undo it at the debtor’s expense
4. PRESTATION NOT TO DO
a. File an action for damages
b. Ask debtor to undo the prohibited act plus
damages
SUBSIDIARY REMEDIES
a. Accion subrogatoria – creditor steps into the
shoes of the debtor; in case debtor refuses to
 CIVIL LAW REVIEW 2 | CGA AKO

run after his own debtor; the action will still be
filed in the name of the debtor as complainant
b. Accion publiciana – remedy given to the owner
for the RECOVERY OF THE POSSESSION of his
property. This is when the 1-year filing period
for ejectment has lapsed;
c. Accion pauliana – remedy given to the creditor
to question the validity of the contracts
entered into by the debtor to avoid attachment;
simulated contract to defraud the creditor
CLASSIFICATION OF OBLIGATIONS
In an obligation to give, what happens if there is loss,
deterioration or improvement of a thing while the
obligation or period is pending?
Note: "Loss" is not only limited to physical loss, but also
includes property that goes out of commerce of men (it
ceases to be aproperty, it becomes a thing) or its
existence becomes unknown
Reminder: A thing becomes a property if: (USA)
1)Utility
2)Substantivity
3)Capable of being appropriated

1. ACCORDING TO PECULIARITY OF THE ANSWER:

PRESTATION
Why peculiarity of the prestation? Because the
obligation will depend on the happening or non-
happening of an event
1)In case of loss: (material only in physical loss)
a) If there is fault of the debtor– he is liable for
damages
b) If there is without the fault of the debtor–
obligation is extinguished

1. PURE OBLIGATION- demandable at once Note: If loss refers to a property that goes out of
2. OBLIGATION WITH A CONDITION commerce of men, it is dependent upon the State to
3. OBLIGATION WITH A PERIOD declare it as such

A condition and a period are also like an event. 2)In case of deterioration: (usually if property involved
A condition and a period are separate and is
distinct from an obligation. consumable)
CONDITION PERIOD a) If there is fault of the debtor–option of creditor
An event that is An event that is certain i. Rescission with damages
uncertain event (Ex. “If to happen (Ex. Death) ii. Fulfillment with damages
you pass the bar”)
b) If there is without the fault of the debtor–
creditor bears impairment
CONDITION PERIOD
SUSPENSIVE Since the event Since the event is 3) In case of improvement: (accession)
is uncertain to sure to happen, a) By nature–benefit the creditor
happen, the the happening of b) At the expense of the debtor–apply the rules
happening of the the event will governing Usufruct
event will GIVE GIVE RISE TO THE
RISE TO THE DEMANDABILITY Note: Right of the usufructuary– Removal of the
OBLIGATION, not of the obligation; improvement
yet the the obligation
demandability already exists Note: These rules are applicable also to an obligation
RESOLUTORY The happening The happening of subject to a suspensive period
of which will which will
EXTINGUISH the EXTINGUISH the Reminder: Like in fortuitous event, the kind of property
obligation obligation involved in a prestation to give is also important. If
specific thing is loss pending or before the happening of

Page 6 of 10
 CIVIL LAW REVIEW 2 | CGA AKO

the condition, obligation is extinguished. If generic, prestation will extinguish NOT to perform the
since genus does not perish, it can still be substituted the obligation prestation that is due but
to substitute it with
2. ACCORDING TO NUMBER OR PLURALITY OF another prestation
PARTIES: If one of the prestation If the substitute becomes
a. Joint–creditor can only demand from him his becomes impossible, the impossible, it becomes
own share; he cannot be compelled to perform the obligation is not an individual obligation
entire obligation extinguished as long as
b.Solidary–only one can be compelled to perform there are other
the entire obligation, e.g., under the Family Code, prestations available
Parental authority between the school, teacher and
administrator; in Torts and Damages, with regard NOTE: In both, there is a choice to be exercised
vicarious liability; under the Revised Penal Code, primarily by the debtor. If he does not exercise, the
regarding the liability of co-principals, co-accomplices, creditor or a third person may exercise the choice. In
and co-accessories; under 1945, liability of the bailees facultative, the choice only belongs to him. He cannot
be compelled by the creditor to make a substitution
Rule: Unless expressly stipulated or when the law (PRO-DEBTOR PROVISION)
provides otherwise, presumption is joint (PRO-DEBTOR
PROVISION) 4. ACCORDING TO THE QUALITY OF AN OBJECT:
a. Positive (to perform) or negative (prohibited)
Note: b. Specific (determinate) or generic
a) Joint & indivisible obligation: To be fulfilled, (indeterminate)
there must be a common desire to perform c. Divisible or indivisible (whether it can be
their obligation. If one refuses, it will be performed partially or not) Ex. Payment by installment
converted into an indemnity for damages, so d. Principal or accessory (connect with contract as
that the obligation may be quantified a source of obligation)
e. Obligation with a penal clause (usually
b) In case of insolvency: If the obligation is joint, applicable in obligations arising from law and
the other debtors will not be liable for the contracts)–serves as damages, but does not mean you
insolvent debtor's share are prohibited to claim additional damages

c) In case of remission or condonation: If the RULE: The law presumes that the obligation is indivisible
obligation is solidary, total remission will benefit (1233,1248) except partly liquidated 1248, instalment
all debtors; while, partial remission will only be contracts 1720, partially illegal
reduced the amount of the obligation. Hence,
the balance remains a solidary credit CLASSIFICATION ACCORDING TO PLURALITY OF
PARTIES
3. ACCORDING TO THE PRESTATIONS OR THE NUMBER 1. JOINT – debtor is NOT compelled to pay the
OF PRESTATIONS entire obligation; only his part
a. Individual 2. SOLIDARY
b. Multiple
i. Alternative Solidary obligation is more onerous on the
ii. Facultative debtor but very favorable to the creditor.
Example of solidary obligations:
ALTERNATIVE FACULTATIVE 1. Special parental authority (school, teacher,
There are several Only one prestation is administrator)
prestations due due 2. Vicarious liability (torts and damages)
Fulfillment of one The debtor has the right

Page 7 of 10
 CIVIL LAW REVIEW 2 | CGA AKO
3. Liability among co-principals, co-
accomplices
4. Liability of bailees
Presumption of the Code is a joint obligation
(pro-debtor)
o Exceptions:
1. Law expressly states solidary
obligation
2. Expressly stipulated
If an obligation to give where the obligation is
indivisible – it is better if the obligation is
SOLIDARY.
There will be a problem if it is a joint obligation
and it is indivisible (Ex. Delivery of a horse)
An obligation can have other features (plurality
of debtors, subject to a condition, partial
fulfillment or not)
If one of the joint debtors REFUSES to perform
his obligation in an indivisible obligation, it will
be converted into indemnity for damages.
There should be a common desire to perform
the obligation.
In case of INSOLVENCY of one or more debtors,
others shall NOT be liable for his share
In REMISSION / CONDONATION:
a. Total remission – no problem
b. Partial remission – the amount will only be
reduced and then the obligation remains to
be solidary.
GENERAL RULE is that the obligation is INDIVISIBLE
EXCEPTIONS:
1. Partially liquidated
2. Installment contracts
3. Partially illegal
OBLIGATION WITH A PENAL CLAUSE
- Allowed to put some pressure on the debtor
EXTINGUISHMENT OF OBLIGATIONS
CONDONATION – gratuitous, therefore it has to comply
with the formalities of a donation. If RP, it should be on
a public instrument (necessary for validity, not
enforceability); if PP does not exceed 5,000, it does not
have to be in writing, it only requires simultaneous
delivery. It may be TOTAL or PARTIAL
Page 8 of 10
Requisites for a Valid Condonation/ Remission
a. It has to be gratuitous; NO consideration
b. It has to be accepted by the debtor
c. It has to be DUE and DEMANDABLE
CONFUSION OR MERGER
- Merger of the personalities of the principal
debtor and principal creditor; it must be
COMPLETE and DEFINITE for it to be valid.
- In relation to a joint obligation, confusion does
NOT apply because a joint debtor is only liable
for his corresponding share
- Negotiable instrument goes back to the maker
or drawer
LEGAL COMPENSATION
Requisites:
1. Principal debtors and creditors of each other
2. Debt is sum of money, consumable, same kind
and quality (fungible)
3. Both debts are due
4. It has to be liquidated (determined and certain
– includes the penalties and interests for it to be
liquidated)
5. Neither subject to retention or controversy (no
other person has interest over it)
The two obligations are extinguished by
OPERATION of LAW
Absence of one requisite means no valid
compensation
The liability should be PRINCIPAL (co-guarantor
not included)
A CONVENTIONAL COMPENSATION is based on
the agreement of the parties: no need to follow
these requisites
A JUDICIAL COMPENSATION involves a case
wherein there is another case involving the
same parties and damages were awarded.
WHEN IS COMPENSATION IS PROHIBITED:
1. Obligation arising from a deposit (contract
wherein you deliver possession of property for
safekeeping)
2. Obligation arising from commodatum (the
bailee have to return the same property handed
to him for USE; NO transfer of ownership)
3. Support by gratuitous title
 CIVIL LAW REVIEW 2 | CGA AKO
4. Civil liability arising from a delict (delict is NOT
subject to settlement)
5. Damage caused by a partner to a partnership
and vice versa
6. When it comes to the government (every
agency has its own fund for its own use; Ex. To
offset income tax)
If a creditor assigns his interest to a third person, can
there still be compensation?
Art. 1285
a. Assignment of credit to a third person was with
the CONSENT of the DEBTOR – compensation
will no longer be applicable if no reservation;
for as long as there is RESERVATION on the part
of the debtor that he can apply compensation
b. Assignment to a third person WITHOUT THE
CONSENT OF THE DEBTOR – compensation will
be applicable ONLY to those that were due
prior to the assignment
c. The CREDITOR assigned his interest WITHOUT
the KNOWLEDGE of the debtor – it will only be
binding upon the knowledge of the debtor
NOVATION
If one of these occurs:
a. The object or principal condition
b. Change in the debtor
c. Change in the creditor
The moment that there is a change, one
obligation is extinguished but a new one is
created.
Novation is NOT presumed; extinguishment of
obligation should be in unequivocal terms
Real novation – change in object (dacion en
pago)
Change in debtor
a. Expromision – change without knowledge
and consent of the OLD debtor or with
consent
b. Delegacion - with consent of the creditor at
the initiation of the old debtor with the
concurrence of the new debtor
If new debtor is INSOLVENT and novation is
without consent of the debtor and insolvency
happens prior to the changing of the debtor and
Page 9 of 10
it is of public knowledge including the debtor –
REVIVAL of OBLIGATION of OLD DEBTOR
If original debtor does NOT know of new
debtor’s insolvency – OBLIGATION OF OLD
DEBTOR WILL NOT BE REVIVED
REQUISITES OF NOVATION:
1. There is an old obligation
2. New obligation is created
3. Substantial difference between the old and the
new obligation
4. Capacity of the parties
5. Intention to extinguish the obligation
CONTRACTS
1. Meeting of the minds
2. One or both parties binds himself or themselves
3. To give or to render service
STAGES IN THE FORMATION OF A CONTRACT
1. Preparatory stage – where offer is made
2. Perfection of birth – this is where the obligation
arises
3. Consummation - the performance of the
obligation; parties go back to their original
position when there was no contract yet; this is
NOT applicable in the contract of marriage (it is
a special contract)
DIFFERENT KINDS OF CONTRACT
1. ACCORDING TO PERFECTION:
a. Consensual – ordinary contract; perfected
upon the meeting of the minds (ex. Sale)
b. Real – perfected by delivery (commodatum,
pledge, necessary deposit)
c. Solemn – there is a formal requirement
(donation of RP)
2. ACCORDING TO IMPORTANCE:
a. Principal – can exist by itself (simple
mutuum)
b. Accessory - Existence is dependent upon a
principal contract (mortgage)
3. ACCORDING TO THE PARTY OBLIGATED TO
PERFORM OR TO RENDER SERVICE
a. Unilateral – only one of the parties have an
obligation to perform (commodatum)
b. Bilateral – reciprocal
 CIVIL LAW REVIEW 2 | CGA AKO

4. ACCORDING TO EQUIVALENCE OF PRESTATION 2. CONSENSUALITY – perfected by mere CONSENT

a. Gratuitous (commodatum, donation) except for real and formal contracts
b. Onerous – exchange of equivalent 3. MUTUALITY – it must bind both parties and its
prestation validity and compliance cannot be left to the
c. Remuneration will of one of the parties
4. OBLIGATORINESS -
ELEMENTS OF A CONTRACT
1. Essential – without which there can be NO
contract
2. Natural – presumed existing (Sale – warranties)
3. Accidental – will only exist upon stipulation of
the parties

E.g. In a sale of a RP in installments, instead of a conract

to sell, it becomes a contract of sale.

CONTRACT TO SELL CONTRACT OF SALE

Ownership will be Ownership is transferred
dependent upon the immediately
fulfillment of the
obligation (payment of
purchase price)

1. CONSENSUAL CONTRACT
a. Consent
b. Subject matter
c. Cause or consideration

2. REAL CONTRACT
a. Consent
b. Subject matter
c. Cause or consideration
d. Delivery

3. FORMAL CONTRACT
a. Consent
b. Subject matter
c. Cause or consideration
d. Formality required by law

PRINCIPLES IN CONTRACTS
1. Autonomy or liberty of contracts – parties may
establish the terms and conditions of the
contract but NOT contrary to law, public morals,
good customs, public policy); it is NOT
applicable in MARRIAGE (parties can only
stipulate on property relations)

Page 10 of 10