COURSE SYLLABUS

PART ONE: OBLIGATIONS

MODULE 1. A. General Provisions

1. Definition (Article 1156, Civil Code)

2. Elements
a. Active Subject
b. Passive Subject
c. Object or Prestation
d. Efficient Cause or Juridical Tie

3. Natural Obligations

a. Definition (Art. 1423, CC)

b. Examples (Articles 1424 to 1430)
c. Difference between Natural and Civil Obligation (Art. 1423)
d. Distinguished from moral obligations

4. Sources of Obligations (Art. 1157)

a. Law (Art. 1158)

b. Contracts (Art. 1159, 1305)
c. Quasi-contracts (Art. 1160, 2142)
• Kinds:
i. Negotiorum gestio (Art. 2144)
ii. Solutio indebiti (Art. 2154)
iii. Others (Art. 2164 to 2175)

d. Delicts or Crime (Art. 1161)

e. Quasi-delicts (Art. 1162, 2176)
• Distinction between crimes and quasi-delicts
• Civil liability arising from crime (Art. 1161; Rule 111)

MODULE 2. B. Nature and Effects of Obligations

1. Kinds of Prestation

a. To give

i. specific thing
• to preserve the thing (Art. 1163)
• to deliver the accessions and accessories (Art 1166)
• to deliver the fruits (Art. 1164, par. 1)
• to deliver the thing itself (Art. 1244)
ii. generic thing (Art. 1246)

b. To do (Art. 1244)
c. Not to do (Art. 1244)

2. Breach of
Obligation

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 a . Concept
b. Modes of Breach

• Delay or mora (Art. 1169)

i. mora solvendi
ii. mora accipiendi (See also 1268)
iii. compensation morae

• Fraud or dolo (Art. 1171)

dolo incidente and dolo causante

• Negligence (Art. 1172, 1173)

- culpa v. dolo
- culpa aquiliano v. culpa contractual
- standard of care required

• Contravention of the tenor (Art. 1172)

c. Remedies in case
of breach

i. Performance
• Specific performance (Art. 1165; Section 10, Rule 39, Rules of
Court)
• Substituted performance
- in an obligation to give generic thing (Art. 1165, par. 2)
- undoing of poor work in an obligation to do (Art. 1167)
- undoing in an obligation not to do (Art 1168)

ii. Rescission (Art. 1191-1192)

iii. Damages (Art. 1170)

d. Fortuitous Event (Art. 1174)

i. Effect: Extinguishment of Liability

ii. Exceptions to Extinguishment (Art. 1174, 1165 par. 3, 552, 1942,
1979, 2001, 2147)

MODULE 3. C. Different Kinds of Obligations

Classification of Obligations

a. Pure and Conditional Obligations (Art. 1179-1192)

b. With a Period or a Term (Art. 1193-1198)
c. Alternative and Facultative (Art. 1199-1206)
d. Joint and Solidary (Art. 1207-1222)
e. Divisible and Indivisible (Art. 1223-1225)
f. With a Penal Clause (Art. 1226-1230)

LESSON 1. Pure and Conditional Obligations

• Pure Obligations (Art. 1179, par. 1)

• Conditional Obligations (Art. 1181)
- Concept

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 - Condition v. Period or Term

• Kinds of Conditions

a. As to the effect on the obligation (Art 1181)

i. Suspensive Condition or Condition precedent

• Retroactive effect when condition is fulfilled (Art. 1187)
• Rights of the creditor and debtor before
fulfillment of the condition (Art. 1188)

ii. Resolutory Condition or Condition subsequent

b. As to the cause or origin (Art 1182)

i. Potestative

• Effect of fulfillment of condition depends solely on the

will of the debtor
• Debtor's promise to pay when he can is not a condition (Art 1180)

ii. Causal
iii. Mixed

c. As to possibility (Art. 1183)

d. As to mode: positive or negative (Art. 1184-1185)

• Rules in case of loss, deterioration or improvement pending the

happening of the condition (Art. 1189 - 1190)

a. Definition of loss, deterioration and

improvement b. Effect of loss or
deterioration
• Without debtor's fault
• With debtor's fault
c. Effect of improvement
• By nature or time
• Due to debtor's effort and expense

• Effect of prevention of the fulfillment of the condition by the obligor (Art. 1186)

LESSON 2. Reciprocal
Obligations (Art. 1191-1192)

a. Concept
b. Alternative remedies of injured parties on case of breach

i. action for specific performance

• effect when fulfillment no longer possible

ii. action for rescission

• requisites
• how made
• effects

• Read: Art 1786, 1788, 1484-86, Republic Act No. 6552

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LESSON 3. Obligations with a
Period (Art. 1193, 1180)

a. Compare Period/Term v.
Condition

b. Kinds of Period

i. As to effect
• Suspensive (Art 1193, par. 1)
• Resolutory (Art 1193, par. 2)
ii. As to expression
• Express
• Implied
iii. As to definiteness
• Definite
• Indefinite
iv. As to source
• Voluntary
• Legal
• Judicial

c. Rules in case of loss, deterioration or improvement before

arrival of the period (Art. 1194 and 1189)

d. Effect of Payment in Advance (Art. 1195; 1197, par. 3)

e. Benefit of Period (Art 1196)

i. For whose benefit
• Creditor
• Debtor
• Both
ii. Effects
iii. Presumption (Art. 1196)
iv. When debtor loses right to make use of period (Art. 1198)

f. When Court May Fix A Period

i. Period is implied
ii. Period depends on sole will of the debtor

LESSON 4. Alternative Obligations

a. Concept (Art. 1199)

b. Right of Choice (Art. 1200)
c. Effect of Notice of Choice
d. When Notice Produces Effect (Art. 1201)
e. Effect of loss or impossibility of one or all prestations (Art. 1202 to 1205)
f. Facultative Obligation (Art. 1206)
i. Concept
ii. Distinguished from Alternative Obligations
iii. Effect of Substitution

LESSON 5. Joint and Solidary

a. Joint Obligations

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 i. Concept
• Requisites
• Words used to indicate joint obligations

ii. Presumption (Art. 1207, 1208)

iii. Effects (Art. 1207, 1208)

• Extent of liability of debtor
• Extent of right of creditor
• In case of novations, compensation, confusion (Art 1277) or
remission

b. Solidary
i. Concept
• Requisites
• Words used to indicate solidary obligations

ii. Kinds
• As to source (Art. 1208)
o Legal (Art. 1915, 1945, 2194, Art 119 of the RPC)
o Conventional
o Real
• As to parties bound
o Active
o Passive
o Mixed
• As to uniformity
o Uniform
o Varied/non-uniform (Art. 1211)

iii. Effects
• Solidary creditor in relation to:
o common debtor
• right to demand (Art. 1214-1216; 1217, par. 1)
• in case of novation, compensation, confusion,
remission by a creditor (Art. 1215, par. 1)
o solidary co-creditors
• in case of novation, compensation, confusion,
remission by a co-creditor (Art 1215, par. 2)
• prejudicial acts prohibited (Art. 1212)
• assignment of rights not allowed (Art. 1213)

• Solidary debtor in relation to:

o common creditor
• obligation to perform (Art. 1207)
• in case of novation, compensation, confusion,
remission by a creditor (Art. 1215, par. 1)
o solidary co-debtor
• in case of payment by a co-debtor (Art. 1217-
1220)
• in case of fortuitous event (Art. 1221)

iv. Defenses Available to a Solidary Debtor Against the Creditor

(Art. 1222)
• Types
o those derived from the nature of the obligations

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 o personal defenses
o defenses pertaining to his shares
o those personally belonging to the other co-debtors

• Effects

c. Joint Indivisible Obligations

i. Concept
• Distinguished from joint obligations
• Distinguished from solidary obligations

ii. Indivisibility distinguished from solidarity (Art. 1210)

iii. Effects (Art. 1209, 1224)

LESSON 6. Divisible and Indivisible Obligations

a. Divisible Obligations
i. Concept
ii. Effects (Art. 1223, 1233)

b. Indivisible Obligations
i. Concept: distinguished from solidary obligations

ii. Kinds
• Natural (Art. 1225, par. 1)
• Legal (Art. 1225, par. 3)
• Conventional (Art. 1225, par. 3)

iii. Presumptions of divisibility and indivisibility (Art. 1225)

iv. Divisibility and indivisibility in obligations not to do (Art. 1225,

par.3 )

v. Effects (Art. 1223, 1223, 1224)

vi. Cessation of Indivisibility

LESSON 7. Obligations with a Penal Clause

a. Concept
• Principal v. Accessory Obligation
• Distinguished from conditional obligations
• Distinguished from alternative obligations
• Distinguished from facultative obligations
• Distinguished from guaranty

b. Kinds of Penal Clause

• As to effect
o Subsidiary
o Complimentary
• As to source
o Conventional
o Legal

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 • As to purpose
o Punitive
o Reparatory

c. Demandability of Penalty (Art. 1226, par. 2)

d. Effects of Penal Clause: General Rule and Exceptions

• Substitute for indemnity for damages and payment of interest (Art. 1226)

• Not exempt debtor from performance (Art. 1227)

• Creditor cannot demand both performance and penalty at the same time
(Art. 1227)

• Creditor cannot collect other damages in addition to penalty (Art. 1226)

e. When penalty shall be equitably reduced (Art. 1229)

f. Nullity of Principal Obligation of Penal Clause (Art. 1230)

MODULE 4. D. Extinguishment of Obligations (Art. 1231)

LESSON 1 - Payment or Performance (Art. 1232)

a. Concept (Art. 1232)

b. Requisites

i. Who can pay

• General Rule

• Exceptions:

o third person who is an interested party; effects (Art. 1302[3])

o third person who is not an interested party but with the

consent of debtor (Art. 1302[2], 1236, par. 1)

o third person who is not an interested party and without the

consent of the debtor, without the knowledge or against
the will of the debtor (Art. 1236, par. 2; Art. 1237, 1236,
par. 1)

o third person who does not intend to be reimbursed (Art

1238)

• in an obligation to give (Art. 1239, 1427)

• in case of active solidarity (Art. 1214)

ii. To whom payment can be made

• General rule (Art. 1240)

• Exceptions:

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 o incapacitated person (Art. 1241, par. 1)

o third person (Art. 1241, par. 2)

o when proof of benefit not required (Art. 1241, par. 3; Art. 1242)

o in case of active solidarity (Art. 1214)

iii. What is to be paid (Identity)

• General Rule

• Specific cases:

o To give a specific thing (Art. 1244)

o To give a generic thing (Art. 1246)

o To pay money (Art. 1249, 1250; R.A. 529, R.A. 4100, R.A. 8183)

• Payment of Interest (Art. 1956)

iv. How payment is to be made (Integrity)

• General Rule (Art. 1233)

o Partial payment is not allowed; exceptions (Art. 1248)

• Substantial performance in good faith (Art. 1234)

• Estoppel (Art. 1235)

• Presumptions in payment of interests and installments (Art. 1176)

v. When is payment to be made

• General Rule (Art 1169)

• No demand, no delay; Exceptions

vi. Where payment is to made

• Place expressly designated (Art. 1251, par. 1)
• When place of payment is not expressly designated
(Art. 1251, paragraphs 2 to 4)

vii. Who pays for expenses for making payment (Art. 1247)

c. Application of Payments
i. Concept (Art. 1252)

ii. Requisites

iii. Rules in Application of Payments (Art. 1252-1253)

• If rules are not applicable or cannot be inferred (Art. 1254)
• Meaning of the "most onerous debtor"

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 d. Payment by Cession
i. Concept (Art. 1255)
ii. Requisites
iii. Effects
iv. Compared to Assignment of Receivables

e. Dation in Payment

i. Concept (Art. 1245)

• Distinguished from Payment by Cession

ii. Requisites

iii. Effects

f. Tender of Payment and Consignation

i. Tender of Payment
• Concept
• Requisites

ii. Consignation
• Concept and Purpose

• Requisites
o When tender and refusal not required (Art. 1256, par. 2)
o Two notice requirement (Art. 1257, par. 1; Art. 1258, par.2);
Effects of non-compliance

• Effects (Art. 1260, par 1)

o Withdrawal by debtor before acceptance by
creditor or approval of court (Art. 1260, par. 2)
o Withdrawal by debtor after proper consignation (Art. 1261)
• With creditor approval
• Without creditor approval

• Expenses of Consignation

LESSON 2. Loss or Impossibility

a. Loss of the Thing Due

i. Concept (Art. 1189, par. 2)

ii. Kinds
• Total
• Partial

iii. Requisites (Art. 1262)

iv. Presumption (Art. 1266, 1267)

v. Effects
• In an obligation to give a specific thing (Art. 1262, 1268)
• In an obligation to give a generic thing (Art. 1263)
• In case of partial loss (Art 1264)

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 • Action against third persons (Art. 1269)

b. Impossibility of Performance

i. Concept (Art. 1266, 1267)

ii. Kinds
• Total
• Partial

iii. Requisites (Art. 1266)

iv. Effects

• In obligations to do (Art. 1266-1267; Art. 1262, par. 2)

• Impossibility distinguished from difficulty

• In case of partial impossibility (art. 1264)

LESSON 3. Condonation or Remission

a. Concept

b. Kinds
• Total or partial
• Express or implied (Art. 1270, par. 1)

c. Requisites (Art. 1270, par. 2)

d. Presumptions (Art. 1271-1271; 1274)

e. Effects
• In general
• In case of joint or solidary obligations

f. Governing Rules (Art. 1270)

g. Renunciation of Principal or Accessory Obligation (Art. 1273)

LESSON 4. Confusion or Merger

a. Concept

b. Requisites

c. Effects
• In general (Art. 1275)
• In case of joint or solidary obligations (Art. 1277)

d. Confusion in Principal or Accessory Obligations (Art. 1276)

LESSON 5. Compensation

a. Concept (Art. 1278); distinguished from Confusion

b. Kinds

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 i. Total or Partial
ii. Legal
iii. Conventional (Art. 1279, Art. 1282)
iv. Judicial (Art. 1283)
v. Facultative

c. Legal Compensation

i. Requisites (Art. 1279-1280): Due distinguished from demandable

ii. Effects (Art. 1290, 1289)

d. When Compensation is not allowed (Art. 1287-1288)

e. Compensation of Debts Payable in Different Places (Art. 1268)

f. Effect of Nullity of Debts to be Compensated (Art. 1284)

g. Effects of Assignment of Credit

i. with consent of debtor (Art. 1285, par. 1)

ii. with knowledge but without consent of debtor (Art. 1285, par. 2)
iii. without knowledge of debtor (Art. 1285, par. 3)

LESSON 6. Novation

a. Concept (Art. 1291)

• Change in debtor
• Change in object
• Change in third person who is subrogated
• Change in creditor with its consent or at its instance is not novation

b. Kinds
i. As to form: express or implied
ii. As to origin: conventional or legal
iii. As to object
• objective or real
• subjective or personal
•
mixe
d

c. Requisites (Art. 1292)

d. Effects (Art. 1296)

e. Effects of the Status of the Original and New Obligation

i. nullity or voidability of original obligation (Art. 1298)

ii. nullity or voidability of new obligation (Art. 1297)
iii. suspensive or resolutory condition or original obligation (Art. 1299)

f. Objective Novation

g. Subjective Novation

i. By change of debtor

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 • Expromision
o Requisites (Art. 1293)
o Effects (Art. 1294)

• Delegacion
o Requisites (Art. 1293)
o Effects (Art. 1295)

ii. By change of creditor - subrogation of a third person in the

rights of the creditor (Art. 1300)

• Conventional subrogation
o Requisites (Art. 1301)
o Distinguished from assignment of credit
o Effects (Art. 1303-1304)

• Legal Subrogation

o Requisites
o When presumed (Art. 1302)
o Effects (Art. 1303-1304)

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