Chapter 1

GENERAL PROVISIONS
The Law on Obligations and Contracts
OBLIGATIONS (1156)
Article 1156. An obligation is a juridical necessity to
give, to do or not to do.
Let’s translate to Tagalog for better understanding
DEBTOR - ang may utang, nangutang, ang may obligasyon

CREDITOR - ang inutangan, nagpautang, ang may karapatang

magdemanda dahil sa hindi pagbayad ni debtor ng utang o pagtupad ng
napag-usapan o napagkasunduan.

OBJECT/PRESTATION - ano ang obligasyon? May ibibigay ba? May

gagawin o hindi gawin?

JURIDICAL TIE - bakit nagkautang?

Law (1158)
● Review our discussion, ‘Introduction to Law’.
● Obligations derived from law are not presumed, it must be expressly
provided for in the Civil Code or in other special laws.

EXAMPLE:

● Obligation to pay taxes is provided for under the Constitution.

● Obligation of parents to give financial support to children is
provided under the Family Code.
Contracts (1159)
● Definition is given in Art. 1305. Contracts will discussed after the
Midterms.
● There is an obligation when two parties reached an agreement. This
agreement is also called as a contract. It has the force of law between
the contracting parties and should be complied in good faith.

EXAMPLE:

● Obligation to pay rent, based on the Contract of Lease.

● Obligation to pay the purchase price, based on the Deed of Sale.
Note:
All contracts have corresponding obligations of the contracting parties
but not all obligations are contracts. Because apart from contracts,
there are other sources of obligations, i.e., law, quasi-contracts, delicts
and quasi-delicts.
Delicts (1161)
● Acts or omissions punishable by law, with a punishment of
imprisonment are called as delicts/crimes.
● There is civil liability that arises from commission of a crime. Every
person criminally liable is also civilly liable. (Art. 100, Revised Penal
Code)
● What is the scope of civil liability?
○ Restitution
○ Reparation for the damage caused
○ Indemnification for consequential damages (Art. 104, Revised
Penal Code)
Nullum crimen, nulla poena sine lege
There is no crime, unless there is a
law punishing it.
Quasi-Contracts (1160)
● Is that juridical relation resulting from lawful, voluntary and unilateral
acts by virtue of which the parties become bound to each other to the
end that no one will be unjustly enriched or benefited at the expense
of another (2142).
● It is not properly a contract at all. In contract, there is meeting of the
minds or consent, parties have deliberately entered into formal
agreement. In quasi-contract, there is no consent but the same is
supplied by fiction of law, to prevent injustice.
Kinds Quasi-Contracts
● NEGOTIORUM GESTIO - the voluntary management of the property
affairs of another without the knowledge and consent of the latter.
(2144).
● SOLUTIO INDEBITI - the juridical relation which is created when
something is received when there is no right to demand it and it was
unduly delivered through mistake (2154); payment by mistake.
Other Examples Quasi-Contracts
● 2164, 2167, 2168 and 2174
● GOOD SAMARITAN. When through an accident or other cause a
person is injured or becomes seriously ill, and he is treated or helped
while he is not in a condition to give consent to a contract, he shall be
liable to pay for the services of the physician or other person aiding
him, unless the service has been rendered out of pure generosity.
(2167)
Quasi-Delicts (1162)
● Is an act or omission by a person which causes damage to another
giving rise to an obligation to pay for damages done, there being fault
or negligence but there is no pre-existing contractual relation between
the parties (2176)
● Is the wrong committed against a person independent of contract and
without criminal intent.
● Also known as CULPA AQUILIANA, CULPA EXTRA CONTRACTUAL
Basis of Liability
● A man is responsible not only for his voluntary willful act executed
consciously and intentional, but also for those acts performed with
lack of foresight, care and diligence, which causes material harm to
society or to other individuals.
Requisites of Quasi-Delict
1. There must be an act or omission
2. There must be fault or negligence
3. There must be damage caused
4. There must be direct relation of cause and effect between the act or
omission and the damage (PROXIMATE CAUSE)
5. There is no pre-existing contractual relation between the parties
 REMEMBER:
Not all acts of negligence is a
quasi-delict.
1. To whom is Driver A liable? Give
the source of obligation.
2. To whom is XYZ Corp. liable? Give
the source of obligation.
1. To whom is Driver A liable? Give
the source of obligation.

Driver A shall be liable to Passenger

B for:
- Delict (Culpa Criminal)
- Quasi-Delict

Note: Both actions can be filed but

Passenger B cannot recover
damages twice for the same act.

Driver A shall be liable to Pedestrian

C for:
- Delict (Culpa Criminal)
- Quasi-Delict

Note: Both actions can be filed but

Pedestrian C cannot recover
damages twice for the same act.
2. To whom is XYZ Corp. liable? Give
the source of obligation.

XYZ Corp. shall be liable to

Passenger B for:
- Culpa-Contractual
- Quasi-Delict

Note: Both actions can be filed but

Passenger B cannot recover
damages twice for the same act.

XYZ Corp. shall be liable to

Pedestrian C for:
- Quasi-Delict
 REMEMBER:
There are as many civil actions that can
be filed, as there are causes of action.

A single act or omission can give rise to

different causes of action.
 CONSTITUTIONAL PROVISIONS
Related to Obligations and Contracts
Sec. 10, Art. III, 1987 Constitution

No law impairing the obligation of

contracts shall be passed.
Sec. 18 (2), Art. III, 1987 Constitution

No involuntary servitude in any form

shall exist except as a punishment for a
crime whereof the party shall have been
duly convicted.
Involuntary servitude
● Denotes a condition of enforced, compulsory service of one to
another. It has been applied to any service or labor which is not free,
no matter under what form such service may have been rendered. It
includes:
○ Slavery or the state of entire subjection of one person to the will
of another.
○ Peonage (debt slavery or debt servitude) or the voluntary
submission of a person (peon) to the will of another because of
his debt.
Sec. 20, Art. III, 1987 Constitution

No person shall be imprisoned for

debt or non-payment of a poll tax.