CHAPTER 2

NATURE AND EFFECTS OF OBLIGATIONS

WHAT IS SPECIFIC OR DETERMINATE THING?

 A thing is determinate when it is particularly designated or physically segregated from all other of
the same class.
WHAT IS GENERIC OR INDETERMINE THING?

 The object thereof is designated merely by its class or genus without any particular designation or
physical segregation from all others of the same class, the loss or destruction of anything of the
same kind even without the debtor’s fault and before he has incurred in delay will not have the
effects of extinguishing the obligation. The rule is based on the principle that the genus of a thing
can never perish. Genus nunquan perit. An obligation to pay money is generic; therefore, it is not
excused by fortuitos loss of any specific property of the debtor.
DILIGENCE

 Is the care; caution; the attention and care required from a person in a given situation.
the attention and care required of a person in a given situation and is the opposite of negligence.
ang atensyon at pangangalagang kailangan ng isang tao sa isang sitwasyon at kabaligtaran ng
kapabayaan.

 Is the degree of care or the conduct to be observed by the debtor in the fulfillment of his
obligation.

 Example. A person who does a job efficiently and takes care of little details. The effort required
to carry out a responsibility or to meet the standard of care.
DUE DILIGENCE

 The diligence reasonably expected from, and ordinarily exercised by a person who seeks to
satisfy a legal requirement or to discharge obligation..
EXTRAORDINARY

 Means that extreme care and caution which very prudent and thoughtful person use in securing
and preserving their own property.
What is delivery?

 Act of transferring something, such as deeed; the giving or yielding possession or control of
something to another
ACTUAL DELIVERY

 means that the item is physically transferred from one party to another
CONSTRUCTIVE DELIVERY
  occurs when the parties conduct themselves as if a transfer of property has occurred without an
actual or symbolic transfer.
KINDS OF RUITS
NATURAL FRUITS

 Are the spontaneous products of the soil, and the young and other products of animals.
 Example grass and plants produced by lands without cultivation or error
INDUSTRIAL FRUITS

 Are those produced by lands of any kind through cultivation or labor

 Example. Rice and vegetable (cabbage, potatoes, tomatoes, and others.) Cultivation or labor.
CIVIL FRUITS

 occurs when the parties conduct themselves as if a transfer of property has occurred without an
actual or symbolic transfer.

ACCESSORIES AND ACCESSIONS

ACCESSIONS

 Includes everything which is produced by a thing, or which is incorporated or attached with it,
either naturally or artificially.
ACCESSORIES

 Those joined or included with the principal for the latters better use, and perfection.
 Example. Keys to a car, key to a car
REMEDIES IN CASE OF FAILURE OF A PERSON OBLIGED TO DO SOMETHING
ART. 1167. If a person obliged to do something fails to do it the same shall be executed at his cost
Article 1167 refers to an obligation to do, i.e., to perform an act or render a service. It contemplates three
situations where the debtor fails to perform an obligation to do, perform the obligation to do but contrary
to the terms thereof, and perform an obligation to do but in a poor manner.
Here are the remedies of creditor in positive personal obligation:
If the debtor fails to comply with his obligation to do, the creditor has the right to have the obligation
performed by himself, or by another unless personal considerations are involved, at the debtor’s
expense; and to recover damages. In case the obligation is done in contravention of the terms of the
same or is poorly done, the court may order (upon complaint) that it be undone if it is still possible to
undo what was done. If the debtor fails to perform the obligation to do, note that the creditor could ask
someone else (a third person) to perform the obligation to do at the expense of the debtor.
FRAUD (DOLO)

 There is a fraud or willful violation of the obligation.

CASUAL FRAUD- fraud in obtaining consent

Example PTB sold to DM a parcel of land representing that land was “ absolutely free from liens and
encumbrances”  DM gave his consent on the faith of  PTB’s representation. Then when the sale was
registered, it was found that a lis pendens notice was annotated.

INCIDENTAL FRAUD- fraud in the performance of obligation

NEGLIGENCE(CULPA)

 Refers to negligence arising from contractual obligations, which are not fully and faithfully
complied by the obligor. This is distinguished from culpa aquiliana, which refers to negligence
independent of any contractual obligation
Tumutukoy sa kapabayaan na nagmumula sa mga obligasyong kontrata, na hindi ganap at tapat na
sinusunod ng obligasyon. Ito ay natatangi mula sa culpa aquiliana, na tumutukoy sa kapabayaan ng
anumang kontrata obligasyon.
KINDS OF NEGLIGENCE
1. Culpa Contractual (contractual negligence)
 Negligence on the performance of a contract.
Kapabayaan sa pagganap ng isang kontrata.

2. Culpa Aquiliana (tort or quasi-delict)
 fault or negligence of a person whose failure to observe the required diligence to the obligation
causes damage to another.

Ang pagkakamali o kapabayaan ng isang tao na ang kabiguang sundin ang kinakailangang
kasigasigan sa obligasyon ay nagiging sanhi ng pinsala sa iba.

3. CULPA CRIMINAL
 fault or negligence which results in the commission of a crime
kasalanan o kapabayaan na mga resulta sa komisyon ng isang krimen

C. DELAY (MORA)

 It refers to the non-fulfillment of obligation with respect to time.

Ito ay tumutukoy sa mga hindi katuparan ng obligasyon na may paggalang sa oras.

KINDS OF DELAY

1. MORA SOLVENDI
  delay on the part of the debtor by not performing his obligation after a demand or specified
time and may either be
 Ex Re - obligations to give
 Ex Persona - obligations to do

Requisites:
 Prestation is demandable and is already liquidated
 The debtor is in delay of the performance due to causes imputable to him and not by acts such
as fortuitous events; and
 The creditor requires or demands the performance judicially or extra-judicially

Reckoning time of delay:

Judicially - date of filing of complaint

Extra-judicially - date of demand

EFFECTS OF MORA SOLVENDI:

1. Debtor is liable for interest in obligation to pay money, or damages.

2. Debtor is liable even for fortuitous event when the obligation is to deliver a specific thing. For generic
things, debtor may still be compelled to deliver a thing of the same kind or be held liable for damages.

2. MORA ACCIPIENDI
 delay in the performance based on the omission by the creditor of the necessary cooperation,
especially acceptance on his part.

Requisites:

i. Offer of performance by the debtor who has the required capacity;

ii. Offer must be to comply with the prestation as it should be performed; and
iii. Creditor refuses the performance without just cause.
Effects of Mora Accipiendi

a. Responsibility of the debtor for the thing is reduced and limited to fraud and gross negligence;

b. Debtor is exempted from the risks of loss of the thing, which automatically passes to the creditor;

c. All expenses incurred by the debtor for the preservation of the thing after the delay shall be
chargeable to the creditor;

d. The creditor shall become liable for damages;

e. The debtor may relieve himself of the obligation by consignation of the thing; and f. If the obligation
bears interest, the debtor does not have to pay from the moment of the mora.

How can a creditor be in delay?

 A creditor can be in delay if the debtor fulfills his obligation but the
creditor refuses to accept the thing due without justifiable reason. It
must be an unjustifiable reason so as delay to exist.

Ang nagpautang ay maaaring ipagpaliban kung tinutupad ng may utang

ang kanyang obligasyon ngunit ayaw tanggapin ng nagpautang ang bagay
dahil walang makatwirang dahilan. Ito ay dapat maging isang di-
makatwirang dahilan upang maantala ang pagkaantala sa umiiral na.

3. COMPENSATION MORAE

 delay of the parties in a reciprocal obligation

DEMAND IN CASE OF DELAY

- No demand no delay! The debtor incurs in delay from the time the obligee
judicially or extrajudicially demands from them the fulfillment of their obligation,
but the debtor failed to perform his obligation. Again, the general rule applies that
if there is no demand there is no delay. Demand is a must.
For delay to exist the following must be present:
a. The obligation must be due and demandable
b. The debtor does not perform his obligation
c. The creditor demands for the performance of the obligation judicially or extra-
judicially
d. The debtor fails to comply with such demand

c.5 Exceptions
There is no need for demand in order for the delay to exist in the following cases:
a. The obligation or the law expressly so declare
b. When time is of the essence of the contract
c. Demand would be useless
d. In reciprocal obligations, 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 the moment one of the parties fulfills his
obligation, delay by the other begins.

d. Contravention of Tenor - Contravention of Tenor. Includes not only any illicit

act which impairs the strict and faithful fulfillment of the obligation but also every kind of
defective performance, unless excused in proper cases for a fortuitous event.
RESCISSION

 requires judicial approval to produce legal effect.

ACCION PAULIANA

 Creditors have the right to impugn the acts which the debtor may have done to defraud them.
Creditors ay may karapatan na ipahiwatig ang mga gawa na kung saan ang may utang ay
maaaring gawin upang ipagpalib ang mga ito

Extinguishment of Liability in case of Breach due to Fortuitous Event

Except in cases expressly specified by law, or when it is otherwise declared by stipulation, or when the
nature of the obligation requires the assumption of risk, no person shall be responsible for those events
which could not be foreseen or which, though foreseen, were inevitable.

FORCE MAJEURE is a clause that is included in contracts to remove liability for

natural and unavoidable catastrophes. It also encompasses human actions, such as
armed conflict.

ay isang clause na kasama sa mga kontrata upang alisin ang pananagutan para sa natural at
hindi maiiwasan catastrophes. Sumasakop din ito sa mga kilos ng tao, tulad ng armadong
labanan.

FORTUITOUS EVENT

EXAMPLE

 Unpredictable events connected with acts of natural forces, occurring independently of the Insured's
will, i.e. fire, flood, avalanche, lighting strike, earthquake, subsidence or landslide, explosion, crash of an
aircraft, volcanic eruption, tornado.
TYPES OF OBLIGATION

1. REAL OBLIGATION
 OBLIGATION TO GIVE
 TO GIVE SPECIFIC THING
 TO GIVE GENERIC THING
2. PERSONAL OBLIGATION
 POSITIVE(TO DO)
 NEGATIVE (NOT TO DO)

1. REAL OBLIGATION (SPECIFIC THING)- PARTICULARLY DESIGNATED OR PHYSICALL SEGREGATED

EXAMPLE: NICH BOUND HIMSELF TO DELIVER TO YOU HIS ONLY DOG TOMORROW

 NAGING SPECIFIC ANG DOG DAHIL NAG IISA LANG YAN ANG TINUTUKOY NI NICK NA IDEDELIVER
NIYA SAYO TOMORROW IS A SPECIFIC DOG ibig sabihin ay nag iisa lang siya sa mundo yung dog
 lang na yon yung only dog niya lang yon na kapag Nawala yun ibig sabihin wala na yung specific
dog na tinutukoy niya.
2. Real Obligation (GENERIC THING)

EXAMPLE:GARY BOUND HIMSELF TO GIVE RICARDO 10,000 TOMORROW

BLAKE OBLIGED HIMSELF TO DELIVER A PIG ON JOHNS BIRTHDAY

 KAPAG OBLIGATION TO GIVE MONEY AUTOMATICALLY GENERIC

NOMINAL DAMAGES

 Are adjudicated in order that a right of the plaintiff, which has been violated or invaded by the
defendant, may be vindicated or recognized, and not for the purpose of indemnifying the
plaintiff for any loss suffered by him.

Ay hinuhusgahan upang ang karapatan ng plaintiff, na kung saan ay nilabag o invaded ng defendant, ay
maaaring mapawalang-bisa o kinikilala, at hindi para sa layunin ng pag-unlad ng kapatagan para sa
anumang pagkawala ng kanyang paghihirap.

TEMPERATE OR MODERATE DAMAGES

 which are more than nominal but less than compensatory damages, may be recovered when the court
finds that some pecuniary loss has been suffered but its amount cannot, from the nature of the case, be
proved with certainty.

na kung saan ay higit pa sa nominal ngunit mas mababa kaysa sa compensatory pinsala, ay maaaring
mabawi kapag ang hukuman ay natuklasan na ang ilang mga pecuniary pagkawala ay pinagdusahan
ngunit ang halaga nito ay hindi maaaring, mula sa kalikasan ng kaso, ay napatunayan nang may
katiyakan.

LIQUIDATED DAMAGES

 A sum of money that a contracting party agrees to pay to the other party for breaching and
agreement, particularly important in a contract in which damages for breach may be difficult to
assess.

Isang kabuuan ng pera na sumasang-ayon ang isang kontrata na bayaran ang iba pang partido para sa
paglabag at kasunduan, lalo na mahalaga sa isang kontrata kung saan ang mga pinsala para sa breach ay
maaaring mahirap suriin.
An example of this would be how a contract for a university dorm rental may state: “Students who
cancel their dormitory housing agreement after moving into their room shall pay liquidated damages
amounting to $5.00/day for the remainder of the rental term (not to exceed $500.00).”

Isang halimbawa nito ay kung paano ang kontrata para sa isang unibersidad dorm rental ay maaaring
estado: "Ang mga mag-aaral na kanselahin ang kanilang dormitoryo pabahay kasunduan matapos ang
paglipat sa kanilang kuwarto ay magbabayad ng likido na halaga sa $5.00/araw para sa natitirang bahagi
ng rental term (hindi sa labis na $500.00)."

REMEDIES OF CREDITOR IN CASE OF BREACH OF REAL OBLIGATION

SPECIC REAL OBLIGATION

1. Demand specific performance or fulfillment of the obligation with a right to indemnity for
damages
2. Demand rescission or cancellation (in certain cases) of the obligation also with a right to recover
damages
3. Demand payment of damages only where it is the only feasible remedy.

GENERIC REAL OBLIGATION

1. Demand compliance with the obligation. If debtor fails, it can be performed by a third person
since the object is expressed only according to its family or genus. However, the creditor can
recover damages in case of breach.

WHEN DEBTOR DELAYS OR IS IN BAD FAITH

 If the debtor is in delay or promised delivery to separate creditors, the happening of a fortuitous
event does not exempt the debtor from responsibility because an indetermine thing cannot be
the object of destruction based on the doctrine genus never perishes (genus nunquam perit)

FRAUD OR DECIT OR DOLO

Fraud is always intentional

KINDS OF FRAUD

1. CASUAL FRAUD OR DOLO CAUSANTE

 Fraud employed in the execution of a contract which vitiates consent or tawag ay defect
consent naenganyo ka mag bigay ng consent sa contract, kung di ka niloko di ka papaya sa
contract nayan. Ininganyo ka na pumasok sa kontrata na kahit alam mon a hindi itong totoong
gold.
 Substantial faud that may constitute a ground for annulment of the contract
 2. Incidental Fraud

NEGLIGENCE

 It is any voluntary act or omission, there being no bad faith or malice, which prevents the
normal fulfillment of an obligation.

Example Negligence occurs when a person puts others at risk as a result of a failure to exercise a
reasonable standard of care. ... A person who breaks texting-and-driving laws and who is typing a text
message when he or she gets into a car accident and kills someone could be considered criminally
negligent.

Kinds of Delay

LEGAL DELAY OR DEFAULT OR MORA

 The failure to perform an obligation on time which failure constitutes a breach of the obligation

ORDINARY DELAY

 Merely the failure to perform an obligation on time

3 KINDS OF DEFAULT

1. MORA SOLVENDI
 Default on the part of the debtor to fulfill his obligation
2. MORA ACCIPIENDI
 Default of the part of the creditor to accept performance of the obligation.
3. COMPENSATIO MORAE
 The delay of the obligors in reciprocal obligations, the delay of the obligor cancels the delay of
the oblige, and vice versa.

LINDS OF NEGLIGENCE

CONTRACTUAL NEGLIGENCE OR CULPA CONTRACTUAL

 Negligence in contracts resulting their breach

Hindi niya naperform ang kanyang obligasyon sa kontrata

CIVIL NEGLIGENCE

 Negligence which by itself is the source of an obligation between the parties not so related
before any pre-existing contract.

CRIMINAL NEGLIGENCE

 Negligence resulting in the commission of a crime.

Example: the bus ay involve sa transportation it is the public utility vehicle it is a common
carrier so public utility vehicle is also they are known as common carrier have the obligation
 exercise extraordinary diligence. Sumakay ka ng bus at mabilis ang takbo ng driver na aksidente
ka dalawa ang victim

FORTUITOUS EVENT OR ACT OF GOD OR FORCE MAJEURE

Any event Which cannot forseen or which though forseen, is enivitable. Otherwise, is an event which is
either impossible to foresee or impossible to avoid. It is independent of the will of the debtor and which
happening, makes the normal fulfillment of the obligation impossible.

SIMPLE LOAN (MUTUUM)

Is a contracting whereby one of the parties deliver to anpther, money, or other consumable thing upon
the condition that the same amount of the same kind and quality shall be paid.