ACTIVITY 1

Multiple Choice (10 points)

Instruction: Write the LETTER and your

CHOICE.
1. D. Payment
2. A. Condonation
3. A. Compensation
4. D. Dacion en pago
5. D. Dacion en pago
6. A. Application of payment
7. B. Cession
8. D. Tender of payment
9. C. Consignation
10. B. Inflation

ACTIVITY 2
Answering Guide Questions (20 points)

Instruction: Answer the following questions in COMPLETE

sentences.
1. Who are the persons from whom the creditor is bound to
accept payment or performance? (4 points)

The creditor is bound to accept payment or performance from

debtor. The debtor is the one who has the obligation to pay or
perform the obligation. Second, creditor is bound to accept
payment or performance from any person who has interest in the
obligation such as the guarantor. If the borrower defaults, it
is the obligation of the guarantor to pay the creditor.
Another is that, creditor can accept payment or performance
from a third person who has no interest in the obligation. The
creditor can only accept payment or performance from a third
person when there is a stipulation.

2. Suppose a third person pays the debtor. How much can

he recover from the latter? (5 points)

When there is a situation that a third person has paid

the creditor, he can demand from the debtor what he has
paid. He is entitled to recover the full amount he had
paid. If the payment is made against the will of the
debtor, the third person or payer can only recover to
such extent or degree of the amount of the debt at the
time of payment. Therefore, he can only recover the
amount of the debt he has paid. Second, if the third
person made a payment with the knowledge of the debtor
the payer has the rights of reimbursement and subrogation
and that is to recover what the third person has paid.
This means that a third person can also acquire all the
rights as if he is the creditor such as the right for
mortgage, penalty or guaranty. However, when the payment
of the third person is against the will of the debtor or
the debtor has no knowledge at all, the third person can
only reimbursed or ask for the amount which has been
benefited by the debtor. The third person cannot compel
the creditor to subrogate him in his rights.

3. When is payment to a third person valid? (3 points)

The payment to a third person is valid when it is rounded for

the benefit of creditor. It is valid when after the payment; the
third person acquires the creditor’s right. Therefore, payment to
the third person is only valid when the third person becomes the
creditor. Second if the creditor ratifies the payment to the
third person. This means that the payment to third person is
valid when it is authorized or has consent from the creditor
himself. Third is, if by the creditor’s conduct the debtor has
been led to believe that the third person had the authority to
receive the payment. Therefore, the third person must keep the
thing so that it can reach to the creditor and be called as
valid.

4. How is payment made? (2 points)

A payment is made through a currency stipulated if it is debt

in money and such currency which is legal tender in the
Philippines. Legal tender is a form of money that courts
of law are required to recognize.

5. Give the rules regarding the place where payment shall

be made? (3 points)

There are rules about places where payment shall be

made. First, whenever there is a stipulation, the payment
shall be made on the agreed place. Therefore, the debtor
must pay to the designated place he and the creditor has
agreed. Second, if there is stipulation and the deliver
thing is specific, the payment shall be made at the place
where the thing was, at the perfection of the contract.
The payment shall be made wherever the thing might be at
the moment the obligation was constituted. When there is
no agreement, it is considered that the place of payment
shall be the domicile.

6. When is a thing considered lost? (3 points)

According to the book, a thing is considered lost when it

perishes, or goes out of commerce, or disappears in such a way
that its existence cannot be recovered or unknown. This means
that a thing is lost when it is destroyed or the recovery of it
is impossible. Just like when delivering a specific thing. It is
distinct because of its uniqueness; once it is lost you cannot
have the same kind of that specific thing. Therefore, it cannot
be regained.