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Law and Obligation Contracts

ALBANDIA, MARY JOY H. BSA-1A

1. A. What is an obligation?

According to Article 1156 of General Provisions, an obligation is a juridical

necessity to give, to do, or not to do.

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The term obligation is derived from the Latin word obligation which means

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tying o binding. It is a tie or bond recognized by law by virtue of which one is bound

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in favour of another to render something – and this may consist in giving a thing,

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doing a certain act, or not doing a certain act.

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B. Give an example of an obligation.
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Under a building contract, X bound himself to build a house for P1,000,000.
Here, X is the passive subject, Y is the active subject, the building of the house is
the object or prestation, and the agreement or contract, which is the source of the
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obligation, is the juridical tie.

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Suppose X had already constructed the house and it was the agreement that Y
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would pay X after the construction is finished, X the becomes the active subject and Y, is
the passive subject.
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2. What are the essential requisites of an obligation? Explain each.

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Every obligation has four (4) essential requisites, namely:

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(1) A passive subject (called debtor or obligor) – the person who is bound to the
fulfilment of the obligation; he who has a duty;
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(2) An active subject (called creditor or oblige) – the person who is entitled to
demand the fulfilment of the obligation; he who has a right;
(3) Object or prestation (subject matter of the obligation) – the conduct required to
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be observed by the debtor. It may consist in giving, doing, or not doing. Without
the prestation, there is nothing to perform. In bilateral obligation, the parties are
reciprocally debtors and creditors;
(4) A juridical or legal tie (also called efficient cause) – that which binds or connects
the parties to the obligation. The tie in an obligation can easily be determined by
knowing the source of the obligation.

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 3. What are the sources of an obligation? Explain.

The sources of obligations are enumerated below:

(1) Law – when they are imposed by law itself.

Example: Obligation to pay taxes; obligation to support one’s family.
(2) Contracts – when they arise from the stipulation of the parties
Example: The obligation to repay a loan or indebtedness by virtue of an
argument.
(3) Quasi-contracts – when they arise from lawful, voluntary and unilateral acts
which are enforceable to the end that no one shall be unjustly enriched or
benefited at the expense of another. In a sense, these obligations may be
considered as rising from law.
Example: The obligation of a thief to return money paid by mistake or which

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is not due.
(4) Crimes or acts or omissions punished by law – when they arise from civil

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liability which is the consequence of a criminal offense.
Example: The obligation of a thief to return the car stolen by him; the duty of

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a killer to indemnify the heirs of hid victim.
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(5) Quasi-delicts or torts – when they arise from damage caused to another through
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an act or omission, there being fault or negligence, but no contractual relation
exists between the parties.
Example: The obligation of the head of a family that lives in a building or a
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part thereof to answer for damages caused by the things thrown or falling from
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the same; the obligation of the possessor of an animal to pay for the damage
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which it may have caused.

4. A. What is the difference between a determinate and an indeterminate thing?

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A determinate or specific thing is identified by its individuality. The debtor

cannot substitute it with another although the latter is of the same kind and quality
without the consent of the creditor.
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An indeterminate or generic thing is identified only by its specie. The debtor

can give anything of the same class as long as it is of the same kind.
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B. Determine if the following are determinate or indeterminate things:

1. The house of Maria – Determinate thing

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2. The bottle of water I am carrying – Determinate thing

3. The dog named Ben – Indeterminate thing
4. A white toyota car – Indeterminate thing
5. A bottle of juice – Indeterminate thing
6. A car with plate number ABC 123 – Determinate thing

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 7. A black watch – Indeterminate thing
8. The house of Pepito – Determinate thing
9. A 3 year old dog of German shepherd breed – Determinate thing
10. 500 pesos bill – Determinate thing

5. A. Explain the different kinds of fruits referred to by law.

The fruits mentioned by the law refer to natural, industrial, and civil fruits.

(1) Natural fruits are the spontaneous products of the soil, and the young and other
products of animals.
(2) Industrial fruits are those produced by lands of any kind through cultivation or
labor.
(3) Civil fruits are those derived by virtue of a juridical relation.

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B. When is a creditor or obligor entitled to these fruits?

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The creditor is entitled to the fruits of the thing to be delivered from the time

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the obligation to make delivery arises. The intention of the law is to protect the
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interest of the obligee should be obligor commit delay, purposely or otherwise, in
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the fulfilment of his obligation.
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C. Anne sold her dog to Janine for 7,000 pesos and while in the possession of
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Anne, the dog gave birth to a puppy. If Janine already paid 7,000 pesos to Anne,
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who is entitled to the puppy? Why?

In a contract of sale “all the fruits shall pertain to the vendee from the day on
which the contract was perfected.” Hence, Janine is entitled t the puppy. This
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holds true even if the delivery is subject to a suspensive condition (e.g., upon the
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demand of Janine) or a suspensive period (e.g., next month) if Janine has paid the
price.
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D. Referring to the above question, if Anne sold and delivered the dog to Maria
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instead, who acted in good faith, who will own the dog?

“He shall acquire no real right over it until the same has been delivered to
him”, means that the creditor does not become the owner until the dog has been
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delivered to Maria. Hence, when there has been no delivery yet, the proper court
action of the creditor is not one for recovery of possession and ownership but one
for specific performance or rescission of the obligation.

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 6. A. What are the kinds of delay? Explain.

They are:

(1) Mora solvendi or the delay on the part of the debtor to fulfil his obligation (to
give or to do).
(2) Mora accipiendi or the delay on the part of the creditor to accept the
performance of the obligation
(3) Compensatio morae or the delay of the obligors in reciprocal obligations (like
in sale), i.e., the delay of the obligor cancels the delay of the obligee, and vice
versa. The net result is that there is no actionable default on the part of both
parties.

B. When is demand not necessary in order that delay may exist?

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No demand, no delay.” This rule is spelled out by Article 1169 of the Civil Code,

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where those obliged to deliver or to do something incur a delay from the

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time the obligee (or the person to whom an obligation is owed) judicially or
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extrajudicially demands fulfillment of the obligation.
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In a situation where a debtor defaults on his payment of a loan, the law requires
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that a demand has to be made by the creditor before the debtor can be
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considered delayed on his payments, except if the contract itself provided that
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no demand is necessary for delay to exist. If no demand was made, then the
loan has not yet become due and demandable, and any foreclosure of
property used as collateral for the loan would be considered premature.
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C. Ben is obliged to deliver a TV to Maria on May 15. However, Ben was not
able to deliver the TV on May 15. Is Ben liable for damages? Explain.
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Ben is only in ordinary delay in the absence of any demand from Maria
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although a period had been fixed for the fulfilment of the obligation. The law
presumes that Maria is giving Ben an extension of time within which to deliver
the TV. Hence, there is no breach of the obligation and Ben is not liable for
damages.
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If a demand is made upon Ben by Maria on May 15 and Ben fails to deliver
the TV, Ben is considered in default only from the date.

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 D. Lyn hired the services of Alex to be the host in a birthday party on May 30.
Alex failed to appear on the said date. Is Alex liable for damages? Explain.

In case of reciprocal obligations, the performance of one is conditioned upon

the simultaneous fulfilment on the part of the other. So neither party incurs in
delay if the other does not comply or is not ready to comply in a proper manner
with what is incumbent upon him.
From this moment, however, a party fulfils or is ready to fulfil his obligation,
delay by the other begins.

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