MODES OF EXTIGUISHMENT OF OBLIGATIONS
(1210a)
PAYMENT:
PAYOR
Article 1236. The creditor is not bound to accept payment or
performance by a third person who has no interest in the
fulfillment of the obligation, unless there is a stipulation to the
contrary.
Whoever pays for another may demand from the debtor what he
has paid, except that if he paid without the knowledge or against
the will of the debtor, he can recover only insofar as the payment
has been beneficial to the debtor.
Article 1237. Whoever pays on behalf of the debtor without the
knowledge or against the will of the latter, cannot compel the
creditor to subrogate him in his rights, such as those arising from a
mortgage, guaranty, or penalty. (1159a)
Article 1302. It is presumed that there is legal subrogation:
(1) When a creditor pays another creditor who is preferred, even
without the debtor's knowledge;
(2) When a third person, not interested in the obligation, pays with
the express or tacit approval of the debtor;
(3) When, even without the knowledge of the debtor, a person
interested in the fulfillment of the obligation pays, without
prejudice to the effects of confusion as to the latter's share.
Article 1238. Payment made by a third person who does not intend
to be reimbursed by the debtor is deemed to be a donation, which
requires the debtor's consent. But the payment is in any case valid
as to the creditor who has accepted it. (n)
Article 1239. In obligations to give, payment made by one who does
not have the free disposal of the thing due and capacity to alienate
it shall not be valid, without prejudice to the provisions of article
1427 under the Title on "Natural Obligations."
Article 1240. Payment shall be made to the person in whose favor
the obligation has been constituted, or his successor in interest, or
any person authorized to receive it
Article 1241. Payment to a person who is incapacitated to
administer his property shall be valid if he has kept the thing
delivered, or insofar as the payment has been beneficial to him.
Payment made to a third person shall also be valid insofar as it has
redounded to the benefit of the creditor. Such benefit to the
creditor need not be proved in the following cases:
(1) If after the payment, the third person acquires the creditor's
rights;
(2) If the creditor ratifies the payment to the third person;
(3) If by the creditor's conduct, the debtor has been led to believe
that the third person had authority to receive the payment.
Article 1242. Payment made in good faith to any person in
possession of the credit shall release the debtor.
Article 1248. Unless there is an express stipulation to that effect,
the creditor cannot be compelled partially to receive the
prestations in which the obligation consists. Neither may the debtor
be required to make partial payments.
Partial Payment; Payment to a wrong party and no presumption
that it redounded to the benefit of creditor
BAR QUESTION:
A owes B P20,000 which became due and payable last October 1,
1983. On that date, A offered B P10,000 the only money he then
had, but refused to accept the payment. A thereafter met C, B’s
22- year old son, to whom he gave the P10,000 with the request
that he turn the money over to B. The money was stolen while in
C’s possession.
Was B justified in refusing to accept the payment of A?
May he still recover the full amount of his debt of P20,000?
Why?
ANSWER:
Yes.
Under the Civil Code a creditor cannot be compelled to receive
partially the prestations in which the obligation consists. A should
have paid the full amount of debt which is 20k instead of paying
only 10K, as this is only a partial payment which the creditor cannot
be compelled to accept
Yes. The Civil Code provides that payment shall be made to the
person in whose favor the obligation is constituted, his
successors-in-interest or any person authorized to receive.
While C is B’s son, the former does not fall under any of the
persons to whom payment should be made
Nonetheless the same code provides that payment made to a third
person shall be valid insofar as it has redounded to the
benefit of the creditor. And such benefit need not proved
in the following cases:
1) if after payment the third person acquires the creditor’s
rights
2) creditor ratifies payment the third person
3) If by the creditor’s conduct the debtor has been led to
believe that the third person has the authority to receive
payment.
In this case the money was stolen, thus it cannot be said that the
payment redound to the benefit of B.
Also neither does C’s circumstance fall under any of the exceptions,
provided under the law where benefit to the creditor need
not be proven.
Article 1240. Payment shall be made to the person in whose favor
the obligation has been constituted, or his successor in interest, or
any person authorized to receive it
Article 1241. Payment to a person who is incapacitated to
administer his property shall be valid if he has kept the thing
delivered, or insofar as the payment has been beneficial to him.
Payment made to a third person shall also be valid insofar as it has
redounded to the benefit of the creditor. Such benefit to the
creditor need not be proved in the following cases:
(1) If after the payment, the third person acquires the creditor's
rights;
(2) If the creditor ratifies the payment to the third person;
(3) If by the creditor's conduct, the debtor has been led to believe
that the third person had authority to receive the payment.
Article 1242. Payment made in good faith to any person in
possession of the credit shall release the debtor.
Payment made to a third person not creditor
T/F:
Payment made by the debtor to a third person who is not the
creditor shall never extinguish the obligation
ANSWER:
FALSE
Under the civil code payment shall be made to the person in whose
favor the obligation has been constituted, his successor in interest
or any person authorized to receive.
Payment to persons not enumerated above is considered as a
payment to the wrong part. However the same code provides for
exceptions as when payment to a third person is not considered as
payment to the wrong party, to wit.:
Payment made to a third person shall also be valid insofar as it has
redounded to the benefit of the creditor. Such benefit need not be
proved in the following cases:
1) after payment, the third person acquires the creditor’s rights
2) creditor ratifies the payment to the third person
3) if by the creditor’s conduct the debtor has been led to believe
that the third person had authority to receive payment
Also under the same code, Payment made in good faith to any
person in possession of credit shall release the debtor.
Article 1240. Payment shall be made to the person in whose favor
the obligation has been constituted, or his successor in interest, or
any person authorized to receive it
Article 1241. Payment to a person who is incapacitated to
administer his property shall be valid if he has kept the thing
delivered, or insofar as the payment has been beneficial to him.
Payment made to a third person shall also be valid insofar as it has
redounded to the benefit of the creditor. Such benefit to the
creditor need not be proved in the following cases:
(1) If after the payment, the third person acquires the creditor's
rights;
(2) If the creditor ratifies the payment to the third person;
(3) If by the creditor's conduct, the debtor has been led to believe
that the third person had authority to receive the payment.
Article 1242. Payment made in good faith to any person in
possession of the credit shall release the debtor.
Payment made to a third person will NOT be valid if:
a. The payment redounded to the benefit of the creditor.
b. The payment was made to a person in possession of evidence of
credit. Or in possession of credit
c. The payment was given to the original creditor after an
assignment of the credit without notice to the debtor.
d. The payment was made to an agent of the creditor who was
authorized to receive payment.
Under the civil code Payment made IN GOOD FAITH to a person in
possession of credit shall release the debtor.
It must be coupled with good faith
Payment made to a “third person” will extinguish the obligation
even if:
a. the payment was made to a person in possession
of credit
b. the payment was given to the original creditor after an
assignment of the credit with knowledge of the assignment
c. the payment was made in good faith to a person in
possession of the evidence of credit
d. all of the aabove
e. none the above
Article 1241. Payment to a person who is incapacitated to
administer his property shall be valid if he has kept the thing
delivered, or insofar as the payment has been beneficial to him.
Payment made to a third person shall also be valid insofar as it has
redounded to the benefit of the creditor. Such benefit to the
creditor need not be proved in the following cases:
(1) If after the payment, the third person acquires the creditor's
rights;
(2) If the creditor ratifies the payment to the third person;
(3) If by the creditor's conduct, the debtor has been led to believe
that the third person had authority to receive the payment.
Payment to person incapacitated valid on 2 grounds
Payment to a person who is incapacitated to administer his
property shall be void.
FALSE
UCV, payment to a person incapacitated to administer his property
shall be valid if he has kept the thing delivered and insofar as it has
been beneficial to him
PAYMENT:
PAYEE
Article 1238. Payment made by a third person who does not intend
to be reimbursed by the debtor is deemed to be a donation, which
requires the debtor's consent. But the payment is in any case valid
as to the creditor who has accepted it.
Payment made by a third person who does not intend to be
reimbursed by the debtor is valid as to the creditor who has
accepted it, with or without the consent of the debtor
ANSWER:
TRUE.
Payment by a third person who does not intend to be reimbursed
by the debtor is deemed to be a donation which requires the
debtors consent. But the payment is IN ANY case valid as to the
creditor who has accepted it.
So long as creditor accepts it is of no issue as to whether or not the
debtor consented to the payment by such third person.
PAYMENT:
CONSIDERATION
Article 1232. Payment means not only the delivery of money but
also the performance, in any other manner, of an obligation. (n)
Article 1244. The debtor of a thing cannot compel the creditor to
receive a different one, although the latter may be of the same
value as, or more valuable than that which is due.
In obligations to do or not to do, an act or forbearance cannot be
substituted by another act or forbearance against the obligee's will.
(1166a)
Article 1246. When the obligation consists in the delivery of an
indeterminate or generic thing, whose quality and circumstances
have not been stated, the creditor cannot demand a thing of
superior quality. Neither can the debtor deliver a thing of inferior
quality. The purpose of the obligation and other circumstances shall
be taken into consideration.
Article 1248. Unless there is an express stipulation to that effect,
the creditor cannot be compelled partially to receive the
prestations in which the obligation consists. Neither may the debtor
be required to make partial payments.
However, when the debt is in part liquidated and in part
unliquidated, the creditor may demand and the debtor may effect
the payment of the former without waiting for the liquidation of the
latter.
Article 1249. The payment of debts in money shall be made in the
currency stipulated, and if it is not possible to deliver such currency,
then in the currency which is legal tender in the Philippines.
The delivery of promissory notes payable to order, or bills of
exchange or other mercantile documents shall produce the effect
of payment only when they have been cashed, or when through the
fault of the creditor they have been impaired.
In the meantime, the action derived from the original obligation
shall be held in the abeyance
PD 72 Sec. 63. Checks representing deposit money do not have
legal tender power and their acceptance in the payment of debts,
both public and private, is at the option of the creditor: Provided,
however, That a check which has been cleared and credited to the
account of the creditor shall be equivalent to a delivery to the
creditor of cash in an amount equal to the amount credited to his
account.
Article 1250. In case an extraordinary inflation or deflation of the
currency stipulated should supervene, the value of the currency at
the time of the establishment of the obligation shall be the basis of
payment, unless there is an agreement to the contrary
Payment of debts in money legal tender; checks are not legal
tender
BAR QUESTION:
Mr. Magaling obtained a judgment against Mr. Mayaman in the
amount of P500,000.00. A writ of execution was issued pursuant
to which various personal properties of Mayaman were levied
upon by the sheriff. An auction sale was scheduled. Before the
appointed day of the auction, Mayaman delivered to the sheriff a
cashier’s check of Far East Bank in the amount of P200,000.00 and
enough cash to cover the remainder of the total amount due.
Magaling refused to accept the check and asked the sheriff to
proceed with the auction sale.
Did Magaling have the right to refuse the payment of part of the
obligation with a cashier’s check?
(In 1986: No. The effective ruling of the SC in New Pacific Timber vs.
Seneris is that manager’s check, certified check and cashier’s check
are as good as cash. As such, the creditor does not have a right to
refuse.)
Today:
YES. Under the civil code payment of debts in money shall be made
in the currency stipulated. If it is not possible to deliver such
currency then in the currency which is legal tender in the
Philippines.
Also under PD 72, Checks representing deposit money do not have
legal tender power.

Mr. Magaling the creditor cannot be compelled to accept payment
through checks, as it does not have legal tender power.
Furthermore the Supreme Court in a decide case posits that checks
of whatever kind do no have legal tender power.
How about the cash component, can Mr. Magaling be compelled
to accept such payment?
NO.
Under the Civil Code, a creditor cannot be compelled to receive
partially the prestations in which the obligation consists.
Mr Mayaman’s judgment debt amounts to 500k, and the cash
component which he can pay is only 300K. Thus this is only a partial
payment of the debt which the creditor cannot be compelled to
accept.
Article 1249. The payment of debts in money shall be made in the
currency stipulated, and if it is not possible to deliver such
currency, then in the currency which is legal tender in the
Philippines.
The delivery of promissory notes payable to order, or bills of
exchange or other mercantile documents shall produce the effect
of payment only when they have been cashed, or when through the
fault of the creditor they have been impaired.
In the meantime, the action derived from the original obligation
shall be held in the abeyance.
Payment thru checks, effect of payment only when encashed
T/F:
The delivery to and acceptance by the creditor of a cashier’s check
produces the effect of payment of the debtor’s obligation.
ANSWER:
FALSE.
Under the civil code delivery of promissory notes payable to order,
or bills of exchange or other mercantile documents shall produce
the effect of payment only when they have been cashed, or when
throught the fault of the creditor they have been impaired.
PAYMENT:
MANNER OF PAYMENT
Article 1234. If the obligation has been substantially performed in
good faith, the obligor may recover as though there had been a
strict and complete fulfillment, less damages suffered by the
obligee
Right of obligor to recover as though there had been strcit and
complete fulfillment of the obligation when the obligation has
been subatantially complied with in good faith
(also can fall under classifation of manner of payment)
“If the obligation has been substantially performed in good faith,
the obligor will recover as though there had been a strict and
complete fulfillment”
ANSWER:
TRUE
Under the civil code if the obligation has been substantially
performed in good faith, the obligor may recover as though there
had been strict and complete fulfillment, less damages suffered by
the obligee
The change of the word MAY to WILL is irrelevant because so long
as there is substantial performance coupled with good faith the
obligor can always recover.
Article 1234. If the obligation has been substantially performed in
good faith, the obligor may recover as though there had been a
strict and complete fulfillment, less damages suffered by the
obligee
Substantial performance defined
=== in order for there to be substantial performance of an
obligation there must have been good faith to perform without any
willful or intentional departure therefrom.
=== the deviation from the obligation must be slight, and the
omission or defect must be technical and unimportant, and must
not pervade the whole or be so material that the object which the
parties intended to accomplish in a particular manner is not
attained
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 upon him.
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.
Substantial performance in relation to substantial breach
Question:
When the debtor is indebted to a sum of money payable in 10
years in monthly installments and the debtor has already paid for
8 years,
Can the creditor still rescind the contract?
Answer:
No.
under the civil code the power to rescind obligations is implied in
reciprocal ones in case one of the obligors failed to comply with
what is incumbent upon him.
There is already a substantial performance on the part of the debtor
when he paid installments for 8 years. Case law dictates that, there
is substantial performance of an obligation when the obligation has
been performed in good faith without any willful or intentional
deviation therefrom. Furthermore deviation from the obligation
must be slight and must not pervade the whole or be so material
that the object which the parties intend to accomplish is not
attained.
A cantena of cases has provided that there is no hard and fast rule
as to what constitutes substantial performance -- it depends on the
circumstances of each case.
As there is already substantial performance rescission cannot be
done as rescission is grounded on the fact that there is failure to
comply with one’s obligation. As there is already partial
performance rescission is not a proper remedy.
If Rescission is not proper, is the creditor entitled to any remedy?
Can the debtor recover?
YES
Under the civil code if an obligation has been substantially
performed in good faith the obligor may recover as though there
had been strict and complete fulfillment thereof, less damages
suffered by the obligee.
Since there is substantial performance in this case, the debtor may
recover what he has delivered or paid less damages suffered by the
creditor.
Article 1235. When the obligee accepts the performance, knowing
its incompleteness or irregularity, and without expressing any
protest or objection, the obligation is deemed fully complied with.
PAYMENT:
APPLICATION OF PAYMENT
Article 1252. He who has various debts of the same kind in favor of
one and the same creditor, may declare at the time of making the
payment, to which of them the same must be applied. Unless the
parties so stipulate, or when the application of payment is made by
the party for whose benefit the term has been constituted,
application shall not be made as to debts which are not yet due.
If the debtor accepts from the creditor a receipt in which an
application of the payment is made, the former cannot complain of
the same, unless there is a cause for invalidating the contract.
Art. 1248. Unless there is an express stipulation to that effect, the
creditor cannot be compelled partially to receive the prestations in
which the obligation consists. Neither may the debtor be required
to make partial payments.
However, when the debt is in part liquidated and in part
unliquidated, the creditor may demand and the debtor may effect
the payment of the former without waiting for the liquidation of the
latter.
Article 1253. If the debt produces interest, payment of the principal
shall not be deemed to have been made until the interests have
been covered. (1173)
Application of Payments
Example:
If A is indebted to B for P100, P50 and P25, and A pays P25,
To which shall the payment apply?
Under the civil code, he who has various debts of the same kind and
in favor of one and the same creditor, may declare at the time of
making the payment, to which of them the same must be applied.
Unless the parties so stipulate or when the application is made by a
person for whose benefit the term has been constituted, application
shall not be made to debts which are not yet due.
Applying the aforementioned provision, payment shall apply to that
debt which the debtor, A shall assign at the time of making the
payment. Also the payment shall be applied to the debt which is
due, unless the parties agreed otherwise and the application has
been made by the person for whose benefit the period has been
constituted, in which case payment may be made even to those
debts which are not yet due
What if A designates the second debt, P50?
Under the civil code, the creditor cannot be compelled to partially
receive the prestations in which the obligation consists. Neither may
the debtor be required to make partial payments, Unless there is an
express stipulation to that effect.
As such since A can only make the payment of 25, he cannot apply
the same to debt of 50 since this is a partial payment in which the
creditor cannot be compelled to accept.
What if A designates the third debt, P25?
Under the Civil Code he who has various debts of the same kind in
favor of one and the same creditor, may declare at the time of
making the payment, to which of them the same must be applied.
Unless the parties so stipulates or when the application is made by a
person for whose benefit the term has been constituted, application
shall not be made to debts which are not yet due.
Under the same code if the debt produces interest, payment of the
principal shall not be deemed to have been made until the interest
has been covered
Applying the said provisions, the designation made by the debtor, A
can be had , since as a general rule it is the debtor who has the right
to declare at the time of making the payment as to which debt the
payment must apply.
However if the debt is not yet due, application to the said debt
cannot be allowed, especially so as when the period is constituted
for the benefit of the creditor, unless the parties so stipulate or
unless the creditor consents to the payment of the debts which are
not yet due.
Furthermore, if the debt of P25 produces interest, payment is not
deemed to have been made unless the interests has been covered.
PAYMENT:
DATION IN PAYMENT
Article 1245. Dation in payment, whereby property is alienated to
the creditor in satisfaction of a debt in money, shall be governed by
the law of sales.
PAYMENT:
CESSION
Article 1255. The debtor may cede or assign his property to his
creditors in payment of his debts. This cession, unless there is
stipulation to the contrary, shall only release the debtor from
responsibility for the net proceeds of the thing assigned. The
agreements which, on the effect of the cession, are made between
the debtor and his creditors shall be governed by special laws.
Cession as a general rule does not extinguish the whole obligation,
unless there is stipulation to the contrary.
T/F:
Payment by cession does not always extinguish the whole
obligation.
ANSWER:
TRUE
Under the civil code, unless there is stipulation to the contrary,
cession shall only release the debtor for the net proceeds of the
thing assigned

LOSS
Article 1262. An obligation which consists in the delivery of a
determinate thing shall be extinguished if it should be lost or
destroyed without the fault of the debtor, and before he has
incurred in delay.
When by law or stipulation, the obligor is liable even for fortuitous
events, the loss of the thing does not extinguish the obligation, and
he shall be responsible for damages. The same rule applies when
the nature of the obligation requires the assumption of risk.
(1182a)
Article 1268. When the debt of a thing certain and determinate
proceeds from a criminal offense, the debtor shall not be
exempted from the payment of its price, whatever may be the
cause for the loss, unless the thing having been offered by him to
the person who should receive it, the latter refused without
justification to accept it.
Article 1263. In an obligation to deliver a generic thing, the loss or
destruction of anything of the same kind does not extinguish the
obligation.
Effect of loss of a determinate and a generic thing
BAR EXAM QUESITON:
For value received, Pedro promised to deliver to Juan on or before
Aug. 15, 1984 a Mercedes benz with plate number 123 which he
had just brought home from Germany as well as a 1984 tv set.
Unfortunately the two were destroyed by an accidental fire. Are
obligations of Pedro extinguished?
Is the Obligation to deliver the Car-extinguished?
Under the civil code, a thing is determinate when it is particularly
designated or physically segregated from all others of the same
class.
Aslo under the same code, an obligation which consists in the
delivery of a determinate thing shall be extinguished if it should be
lost or destroyed without the fault of the debtor and before he has
incurred in delay.
The car that was supposed to be delivered by Pedro is a Mercedes
Benz with plate number 123, is a determinate thing which is
particularly designated owing to its plate number. As such, the
obligation of Pedro is considered as an obligation which consists in
the delivery of a determinate thing.
As the car was destroyed due to a fortuitous event, clearly without
fault on the part of Pedro, debtor the obligation is extinguished.
Is the obligation to deliver the tv set extinguished?
NO.
Under the Civil code, in an obligation to deliver a generic, the loss or
destruction of anything of the same kind and value does not
extinguish the obligation.
The 1984 tv set is a generic thing since it is not particularly
designated or physically segregated from all others of the same
class. As such the delivery of the tv set is an obligation to deliver a
generic thing, which is not extinguished by the loss or destruction of
the same on the ground that genus never perishes.
Article 1264. The courts shall determine whether, under the
circumstances, the partial loss of the object of the obligation is so
important as to extinguish the obligation
Partial Loss:
A promised to deliver a cellphone with its casing. The cellphone
was stolen but A managed to save the casing.
Would A still be liable to deliver the casing?
Answer:
Yes, if the primary consideration of the creditor was to obtain the
casing.
NOVATION
CONTRACTS
VOIDABLE CONTRACTS:
CONSENT; FRAUD:
Article 1330. A contract where consent is given through mistake,
violence, intimidation, undue influence, or fraud is voidable.
Article 1391. The action for annulment shall be brought within four
years. This period shall begin:
In cases of intimidation, violence or undue influence, from the time
the defect of the consent ceases.
In case of mistake or fraud, from the time of the discovery of the
same.
And when the action refers to contracts entered into by minors or
other incapacitated persons, from the time the guardianship ceases.
An action for rescission of a contract entered into to defraud a
creditor will prosper 4 years from actual discovery of fraud.
TRUE (but in the samplex thisis false, rationale “from the time of
registration”)
In case of mistake or fraud the action for annulment shall be
brought within four years from the time of discovery of the same.
CONSENT; UNDUE INFLUENCE
Article 1336. Violence or intimidation shall annul the obligation,
although it may have been employed by a third person who did not
take part in the contract. (1268)
Article 1337. There is undue influence when a person takes
improper advantage of his power over the will of another,
depriving the latter of a reasonable freedom of choice. The
following circumstances shall be considered: the confidential,
family, spiritual and other relations between the parties, or the fact
that the person alleged to have been unduly influenced was
suffering from mental weakness, or was ignorant or in financial
distress. (n)
Undue influence shall annul the obligation, although it may have
been employed by a third person who did not take part in the
contract
TRUE.
While under the code it is specifically stated that violence or
intimidation shall annul the obligation , although it may have been
employed by a third person who did not take part in the contracts
The same rule applies to undue influence.
Under the same code, there is undue influence when a person takes
improper advantage of his power over the wil of another depriving
the latter of a reasonable freedom of choice.
The provision merely speaks of “a person” as such it can be properly
inferred that the code did not limit to the parties to the contract,
the person who may exercise undue influence.
RESCISSIBLE CONTRACTS
CONTRACTS IN FRAUD OF CREDITORS
Article 1381. The following contracts are rescissible:
(1) Those which are entered into by guardians whenever the wards
whom they represent suffer lesion by more than one-fourth of the
value of the things which are the object thereof;
(2) Those agreed upon in representation of absentees, if the latter
suffer the lesion stated in the preceding number;
(3) Those undertaken in fraud of creditors when the latter cannot
in any other manner collect the claims due them;
(4) Those which refer to things under litigation if they have been
entered into by the defendant without the knowledge and approval
of the litigants or of competent judicial authority;
(5) All other contracts specially declared by law to be subject to
rescission.
Article 1384. Rescission shall be only to the extent necessary to
cover the damages caused.
Rescission shall be only to the extent necessary to cover the
damage caused by a contract in fraud of a creditor
TRUE
Article 1387. All contracts by virtue of which the debtor alienates
property by gratuitous title are presumed to have been entered into
in fraud of creditors, when the donor did not reserve sufficient
property to pay all debts contracted before the donation.
Alienations by onerous title are also presumed fraudulent when
made by persons against whom some judgment has been rendered
in any instance or some writ of attachment has been issued. The
decision or attachment need not refer to the property alienated,
and need not have been obtained by the party seeking the
rescission.
A conveyance is presumed to be in fraud of creditor if made by a
debtor after a suit is filed against him while it is pending.
FALSE.
Undeer the civil code alienations by onerous title are presumed to
in fraud of creditors when made by a person against whom some
judgment has been rendered or some writ of attachment has been
issued.
Only a suit was file, and no judgment was rendered and also
nowhere does it state that the conveyance is by onerous title. As
such the said conveyance cannot be presumed to be in fraud of
creditors.
REFORMATION OF INSTRUMENTS
Article 1359. When, there having been a meeting of the minds of
the parties to a contract, their true intention is not expressed in the
instrument purporting to embody the agreement, by reason of
mistake, fraud, inequitable conduct or accident, one of the parties
may ask for the reformation of the instrument to the end that such
true intention may be expressed.
If mistake, fraud, inequitable conduct, or accident has prevented a
meeting of the minds of the parties, the proper remedy is not
reformation of the instrument but annulment of the contract.
A contract which is void on its face cannot be the subject of
reformation.
TRUE.
Under the civil code when there is meeting of the minds between
the parties but their true intention is not expressed in the
instrument purporting to embody the agreement by reason of
mistake, fraude, ininequitable conduct or accident, one of the
parties may ak for the reformation of the instrument so that the
true intention of the parties may be expressed.
If however the mistake, fraud or inequitable conduct or accident
has prevented the meeting of the minds of the parties the proper
remedy is not the reformation of the instrument but the annulment
of the contract
A void agreement cannot be the subject of reformation. Because
Reformation presupposes that there is a valid and exiting contract
between the partied and it is only that the real document
evidencing their agreement does not reveal the true intention of
the parties.
In effect what really is the subject of reformation is the real
intention of the parties.
Article 1356. Contracts shall be obligatory, in whatever form they
may have been entered into, provided all the essential requisites
for their validity are present. However, when the law requires that
a contract be in some form in order that it may be valid or
enforceable, or that a contract be proved in a certain way, that
requirement is absolute and indispensable. In such cases, the right
of the parties stated in the following article cannot be exercised.
Article 1357. If the law requires a document or other special form,
as in the acts and contracts enumerated in the following article, the
contracting parties may compel each other to observe that form,
once the contract has been perfected. This right may be exercised
simultaneously with the action upon the contract
Article 1358. The following must appear in a public document:
(1) Acts and contracts which have for their object the creation,
transmission, modification or extinguishment of real rights over
immovable property; sales of real property or of an interest
therein are governed by articles 1403, No. 2, and 1405;
(2) The cession, repudiation or renunciation of hereditary rights or
of those of the conjugal partnership of gains;
(3) The power to administer property, or any other power which has
for its object an act appearing or which should appear in a public
document, or should prejudice a third person;
(4) The cession of actions or rights proceeding from an act
appearing in a public document.
All other contracts where the amount involved exceeds five
hundred pesos must appear in writing, even a private one. But sales
of goods, chattels or things in action are governed by articles, 1403,
No. 2 and 1405. (1280a)
Once a contract is perfected, though the same is not in the form
required by law, the contracting parties may compel each other to
observe that form

TRUE.

Lesion or inadequacy of cause shall not invalidate a contract,

unless there has been fraud, mistake or undue influence.