NAME: BILIGAN, KING MARCO L.

YR & SECTION: BSBA MM 2-3

1. LEGAL DEFINITION OF CONTRACTS

- According to Article 1305 “A contract is a meeting of minds between two persons
whereby one binds himself, with respect to the other, to give something or to render some
service.”
2. GIVE ATLEAST 5 KINDS OF CONTRACTS. EXPLAIN EACH BRIEFLY
(1) Rescissible Contracts
- are those validly agreed upon because all the essential elements exist and,
therefore, legally effective, but in the cases established by law, the remedy of rescission
is granted in the interest of equity.
(2) Voidable Contracts
- Voidable or annullable contracts are those which possess all the essential requisites
of a valid contract but one of the parties is legally incapable of giving consent, or consent
is vitiated by mistake, violence, intimidation, undue infl uence, or fraud.
(3) Unenforcable Contracts
- Unenforceable contracts are those that cannot be enforced in court or sued upon by
reason of defects provided by law until and unless they are ratifi ed according to law
(4) Void Contracts
- Void contracts are those which, because of certain defects, generally produce no
effect at all. They are considered as inexistent from its inception or from the very
beginning.
(5) Inexistent Contracts
- Inexistent contracts refer to agreements which lack one or some or all of the elements
(i.e., consent, object, and cause) or do not comply with the formalities which are essential
for the existence of a contract.
3. WHAT IS CONTRACT OF ADHESION
Contracts of Adhesion
- An adhesion contract, also known as a contract of adhesion, is a contract where the
parties are of such disproportionate bargaining power that the party of weaker bargaining
power could not have negotiated for variations in the terms of the contract.
4. WHAT ARE THE ESSENTIAL REQUISITES OF CONTRACT, EXPLAIN EACH
(1) Consent of the Contracting Parties;
- Consent is the conformity of wills and with respect to contracts, it is the agreement of
the will of one contracting party with that of another or others, upon the object and terms
of the contract.
- Article 1319 “Consent is manifested by the meeting of the offer and the acceptance
upon the thing and the cause which are to constitute the contract. The offer must be
certain and the acceptance absolute. A qualified acceptance constitutes a counter-offer”
(2) Object certain which is the subject matter of the contract;
- The object of every contract is the obligation created. But since a contract cannot exist
without an obligation, it may be said that the thing, service, or right which is the object of
the obligation is also the object of the contract.
- Article 1347 “All things which are not outside the commerce of men, including future
things, may be the object of a contract. All rights which are not intransmissible may also
be the object of contracts.
No contract may be entered into upon future inheritance except in cases expressly
authorized by law.
All services which are not contrary to law, morals, good customs, public order or public
policy may likewise be the object of a contract.”
(3) Cause of the obligation which is established.
- Cause (causa) is the essential or more proximate purpose or reason which the
contracting parties have in view at the time of entering into the contract
- Article 1350 “In onerous contracts the cause is understood to be, for each contracting
party, the prestation or promise of a thing or service by the other; in remuneratory ones,
the service or benefit which is remunerated; and in contracts of pure beneficence, the
mere liberality of the benefactor”
5. EXPLAIN
a. Relativity of Contracts
- Contracts take effect only between the parties, their assigns and heirs, except in cases
where the rights and obligations arising from the contract are not transmissible by their
nature, or by stipulation, or by provision of law.
b. Consensuality of Contracts
-Contracts are perfected, as a general rule, by mere consent and from that moment the
parties are bound not only by the fulfilment of what has been expressly stipulated but also
to all the consequences which, according to their nature, may be in keeping with good
faith, usage and law
c. Freedom of Contracts
- The parties may establish such stipulations, clauses, terms, and conditions as they may
deem convenient, provided, they are not contrary to law, morals, good customs, public
order, and public policy