Article 1186 of the law discusses the constructive fulfillment of a suspensive condition in obligations.

It outlines three key requisites

for the application of this article:

1. The condition must be suspensive.

2. The obligor must actively prevent the fulfillment of the condition.
3. The obligor must act voluntarily.

This article does not require the obligor to act with malice or fraud, as long as their purpose is to prevent the condition's fulfillment.
The objective is to prevent the obligor from benefiting from their own fault or bad faith at the expense of the obligee.

Examples provided illustrate cases where constructive fulfillment applies:

1. If the obligor (X) agreed to give a commission to the obligee (Y) for selling a property, and X himself sells the property to the buyer
without Y's involvement to avoid paying the commission, the condition is considered fulfilled.
2. In a case where S promised to sell his land to Y if Y could secure a loan, but later S prevented Y from obtaining the loan, the
condition is deemed fulfilled, and S is liable to sell his land.
3. Even if the obligor's act was not motivated by malice or fraud, but it purposefully prevents the condition's fulfillment, constructive
fulfillment can apply. However, it does not apply if the obligor's act is within their legal rights.
4. In a scenario where X was supposed to paint Y's house, but Y hired another contractor to complete the job before X could finish,
the condition (painting the house) is considered fulfilled, converting Y's obligation to pay X to a pure obligation.

An illustrative case further demonstrates constructive fulfillment:

In a case involving a contract for attorney's fees based on a contingent fee arrangement, the obligor, Mrs. W, and her husband, H,
entered into an agreement to defeat the lawyer's claim for fees. The condition for the payment of attorney's fees was deemed fulfilled
because W's actions made it impossible for the condition to be met.

This article is intended to prevent obligors from avoiding their obligations through their own fault or bad faith when dealing with
suspensive conditions in contracts and obligations.

The text discusses two separate cases involving obligations and their fulfillment:

Case 1: Life Pension Conditions

- PLDT (Philippine Long Distance Telephone Company) had established a pension plan for its employees before the war.
- The plan entitled employees to a life pension under specific conditions (age 50 and 20 years of service).
- After the war, due to war losses, PLDT's Board of Directors abolished the pension plan.
- Beneficiaries of the pension plan filed a claim for monetary benefits under the plan.
- The issue was whether the conditions imposed in the pension plan should be considered fulfilled.
- The court held that the conditions were indeed fulfilled because the pension plan was not merely a gratuity but a binding contract.
- PLDT couldn't disregard the plan at will, as it was designed to encourage employees to continue in its service and work more
diligently on its behalf.
- The acceptance of the plan by employees was inferred from their continued employment after the plan was made known.
- PLDT's war losses did not extinguish its obligation, as it was a generic obligation (to pay money), and such obligations are not
extinguished by financial losses.

Case 2: Lessor's Notice Obligation

- A surety bond required the lessor (creditor) to report lease contract violations by the lessee (debtor) within five days; otherwise, the
bond would be void.
- The lessee defaulted on November 5, and the five-day period to notify expired on November 10.
- However, the lessor only received a copy of the bond from the surety on November 21, after the expiration of the notification period.
- The question was whether the surety was absolved of its liability to the lessor.
- The court ruled that the surety was not absolved of its liability because, by not notifying the lessor within the stipulated period, the
surety was deemed to have waived the condition. This is because a condition is deemed fulfilled when the obligor voluntarily prevents
its fulfillment.

In both cases, the courts emphasized the importance of fulfilling obligations as per the terms of contracts and not using arbitrary
reasons to avoid those obligations.

Article 1186 discusses the concept of constructive fulfillment of a resolutory condition. This article applies to obligations subject to a
resolutory condition where the debtor is obligated to return what they've received upon the fulfillment of the condition. An example
provided illustrates this:

- If X obligates himself to allow Y to occupy his house in Manila as long as X is assigned to work in the province, and Y, upon
learning that X is to be transferred to Manila, influences the company's president to assign someone else in place of X, the obligation
of X is extinguished because Y voluntarily prevented the fulfillment of the resolutory condition. Therefore, Y must vacate the house.

Article 1187 discusses the effects of a conditional obligation to give once the condition is met:

- The effects of a conditional obligation to give will retroact to the day when the obligation was established.
- In reciprocal obligations (obligations where both parties owe something to each other), the fruits (profits or benefits) and interests
(financial gains) during the condition's pending fulfillment are considered mutually compensated.
- In unilateral obligations (where only one party owes something), the debtor (obligated party) retains the fruits and interests received
unless it's clear from the nature and circumstances of the obligation that the intention of the person establishing the obligation was
different.
- In obligations to do and not to do, the courts will determine the retroactive effect of the condition that has been fulfilled on a case-by-
case basis.

The key points to highlight are the principles governing the retroactive effects of conditional obligations, the compensation of fruits
and interests in reciprocal obligations, and the discretionary role of the courts in determining retroactive effects in obligations to do
and not to do.

1. **Retroactive Effects in Obligations to Give:**

- In obligations to give, where the obligation is subject to a suspensive condition, the obligation becomes demandable only after the
condition is fulfilled.
- Once the condition is fulfilled, its effects retroact to the day when the obligation was established. This means that it is as if the
obligation existed from the time it was constituted.
- This rule does not necessarily apply to real contracts, as they are typically perfected only upon the delivery of the object of the
obligation.
**Example:** If a seller agrees to sell land to a buyer upon the buyer losing a court case, once the condition is fulfilled, the buyer's
right to the land is considered to have existed from the time the obligation was constituted. This may affect the buyer's rights over the
land, especially in case of subsequent sales or dealings with third parties.

2. **Retroactive Effects in Obligations to Do or Not to Do:**

- In obligations to do or not to do, no fixed rule is provided regarding the retroactive effect of fulfilling a suspensive condition.
- However, this does not mean that the principle of retroactivity is not applicable. Courts have the discretion to determine the
retroactive effect based on the intent of the parties.
- Courts can decide whether the fulfillment of the condition should have a retroactive effect, or if so, from what date that retroactive
effect should be considered.
**Examples:**
- If an obligation is to forgive a debt upon a lawyer winning a case, the fulfillment of the condition will have a retroactive effect. The
debtor (C) will not be entitled to earned interest during the pendency of the condition because the intention is to extinguish the debt.
- If the obligation is to construct a house for someone upon the fulfillment of a condition, whether there is a retroactive effect
depends on the nature of the obligation and the parties' intent. In this case, there may be no retroactive effect, and the party fulfilling
the obligation might not be liable for interest on the money value of the obligation during the intervening period.

In summary, the text outlines how suspensive conditions affect the demandability and retroactive effects of obligations in different
scenarios, highlighting the discretionary role of the courts in determining these effects, especially in obligations to do or not to do.

This text discusses the retroactive effects as they pertain to fruits and interests in obligations to give, particularly in the context of
suspensive conditions. Here are the key points:

1. **Retroactive Effects in Reciprocal Obligations:**

- In reciprocal obligations (where both parties owe something to each other), there is generally no retroactivity regarding fruits and
interests.
- Fruits and interests received during the pendency of the condition are considered to have been mutually compensated.
- This rule is established for convenience, eliminating the need for parties to account for what they have received during the period
when the condition was pending.
- Fruits can be natural, industrial, or civil in nature.
**Example:** If a seller (S) promised to sell land to a buyer (B) upon the buyer losing a court case, when the condition is fulfilled,
S must deliver the land, and B must pay the agreed price. Neither party is obligated to account for fruits received from the land before
the condition's fulfillment, and no legal interest on the price is required since these are considered mutually compensated.

2. **Retroactive Effects in Unilateral Obligations:**

- In unilateral obligations (where only one party owes something), there is typically no retroactive effect.
- This is because unilateral obligations are often gratuitous. The debtor receives nothing from the creditor, so fruits and interests
belong to the debtor unless there is evidence that the intent of the person creating the obligation was different.
**Example:** If the promise was to donate the land to B upon a condition's fulfillment, S would have to deliver the land to B when
the condition is met. S is entitled to keep the fruits and interests received during the period when the condition was pending (from
January 20 to December 4) unless there is a clear intention that S should account for the fruits received during that time.

3. **Preservation of Rights and Recovery by the Debtor:**

- Before the fulfillment of the condition, the creditor has the right to take appropriate actions to preserve their rights.
- In the case of a suspensive condition, if the debtor has paid something by mistake during the period when the condition was
pending, they have the right to recover what they've paid.

In summary, this text explains the principles regarding the retroactive effects of fruits and interests in obligations to give, emphasizing
the differences between reciprocal and unilateral obligations and the actions creditors and debtors can take before the fulfillment of the
condition.

Article 1188 This text discusses the rights of both the creditor (the party awaiting fulfillment of a condition) and the debtor (the party
subject to the condition) pending the fulfillment of a suspensive condition in obligations. Key points to highlight are:

1. **Rights of the Creditor:**

 - The creditor has the right to take appropriate actions to preserve their rights while the condition is pending. This is necessary to
prevent the debtor from making the obligation nugatory upon the condition's fulfillment.
- These actions may include going to court to prevent the alienation or concealment of the debtor's property or having their right
annotated in the property registry.
- This rule also applies, by analogy, to obligations subject to a resolutory condition.
2. **Rights of the Debtor:**
- The debtor has the right to recover any payments made by mistake before the fulfillment of the suspensive condition.
- This right is granted because it is uncertain whether the creditor will be able to fulfill the imposed condition, and it is based on the
principle that no one should enrich themselves at the expense of another.
- The payment must be "by mistake" for the debtor to have the right to recover it. If the condition is fulfilled, the debtor cannot
recover any payments made. However, if the condition is not fulfilled, the debtor should be allowed to recover the payment, even if it
was not made by mistake.
3. **Illustrative Case:**
- An illustrative case is presented where a contract to sell a parcel of land had a suspensive condition related to full payment by the
buyer (B).
- The seller (S) later executed a deed of absolute sale to another party (T) because B had not made full payment, and it appeared that
B had no intention to buy the property.
- The issue was whether B was entitled to recover the property from T.
- The court held that B was not entitled to recover the property because there was no actual sale, and full payment was dependent on
the condition. However, the court ordered S's heirs to pay B interest on the amount received by S.

In summary, this text explains the rights of both the creditor and the debtor while a suspensive condition is pending, as well as the
conditions under which the debtor can recover payments made by mistake before the condition's fulfillment. It also provides an
illustrative case to clarify these principles.

Here are the key points from the provided text:

**Article 2160:** This article explains that if someone in good faith accepts an undue payment of a specific and determinate thing,
they will only be responsible for the impairment or loss of that thing or its accessories and accessions to the extent they have
benefited. If they have already sold the item, they must return the price or assign the action to collect the sum.

**Article 1189:** This article discusses the rules regarding the improvement, loss, or deterioration of a specific or determinate thing
during the pendency of a suspensive condition in a real obligation. The rules include:
1. If the thing is lost without the fault of the debtor, the obligation is extinguished.
2. If the thing is lost through the fault of the debtor, they must pay damages.
3. If the thing deteriorates without the fault of the debtor, the impairment is borne by the creditor.
4. If the thing deteriorates through the fault of the debtor, the creditor may choose between rescission of the obligation with damages
or fulfillment of the obligation with damages.
5. If the thing is improved by nature or time, the improvement benefits the creditor.
6. If the thing is improved at the expense of the debtor, the debtor has rights similar to those of a usufructuary.

Requisites for application of Article 1189.

Article 1189 applies only if:
(1) The obligation is a real obligation;
(2) The object is a specific or determinate thing;
(3) The obligation is subject to a suspensive condition;
(4) The condition is fulfilled; and
(5) There is loss, deterioration, or improvement of the thing during
the pendency of the happening on one condition.

**Article 1190:** This article states that when conditions are meant to extinguish an obligation to give, the parties must return what
they have received upon the fulfillment of these conditions. The same rules apply in case of the loss, deterioration, or improvement of
the thing as specified in Article 1189.

**Effects of Fulfillment of Resolutory Condition:**

1. In obligations to give, when the resolutory condition is fulfilled, the obligation is extinguished, and the parties are obliged to return
to each other what they received.
2. This return to the status quo is retroactive.
3. The obligation of mutual restitution is absolute and includes not only the things received but also the fruits and interests.
4. In obligations to give subject to a suspensive condition, the retroactivity may admit exceptions based on whether the obligation is
bilateral or unilateral. However, in obligations subject to a resolutory condition, there are generally no exceptions.
5. If the condition is not fulfilled, the rights acquired by a party become vested.

In summary, the text covers the legal principles related to undue payments, conditions in obligations, and their effects on the parties
involved. It outlines specific rules for loss, deterioration, and improvement of things during the pendency of a condition, and the
consequences of the fulfillment of resolutory conditions in obligations to give and obligations to do or not to do.

Here are the key points from the provided text:

**Applicability of Article 1189 to Party with Obligation to Return:**

- When a resolutory condition is fulfilled, the roles of debtor and creditor may change. The debtor becomes the creditor with a right to
demand the return of the item, and the creditor becomes the debtor with the obligation to return the item.
- The provisions of Article 1189, which deal with loss, deterioration, or improvement of a thing during the pendency of a condition,
apply to these situations. Parties are entitled to the rights granted by Article 1188.

**Article 1191: Remedies in Reciprocal Obligations:**

- Article 1191 deals with the rescission of obligations in reciprocal ones when one of the obligors fails to comply with their obligation.
- The injured party has two choices: they can demand either the fulfillment of the obligation with damages or the rescission of the
obligation with damages.
- Rescission is applicable to reciprocal obligations and should not be confused with other forms of rescission, such as those based on
defects in consent or contract violation.

**Choice of Remedy by the Injured Party:**

- The injured party may choose either a lawsuit for specific performance (fulfillment) of the obligation with damages or a lawsuit for
rescission of the obligation with damages when the other party does not fulfill their obligation in reciprocal obligations.
**Breach of Obligation:**
- A breach of obligation occurs when one party fails or refuses, without legal reason or excuse, to perform their part of the agreement.
- The rule of exceptio non adimpleti contractus states that the party who has not performed their part of the agreement is not entitled to
sue.
- Only the injured party can rescind a contract without violating the principle of mutuality of contracts, which prohibits allowing the
validity and performance of contracts to be left to the will of one party.

In summary, the text covers the principles of reciprocal obligations, the remedies available when one party fails to fulfill their
obligation, and the options for the injured party to seek either specific performance or rescission with damages in the case of contract
violations.

In Article 1191, the principal action for rescission due to non-performance is different from the subsidiary action for rescission due to
lesion or damage (as per Article 1381, et seq). Article 1191 doesn't require economic prejudice or lesion to trigger the right to rescind.
Instead, it is based on the breach of faith by one party, which violates the reciprocity between the parties.

- The effect of rescission, as stated in Article 1191, is to abrogate and undo the contract from the beginning, restoring the parties to the
relative positions they would have occupied had the contract never been made.
- Rescission under Article 1191 involves mutual restitution of benefits received from the contract to return the parties as closely as
possible to their original situation before the contract's inception.
- Several illustrative cases were provided to clarify the application of Article 1191, such as its applicability to contracts of lease and
partnership and the importance of distinguishing between contracts of sale and contracts of mortgage with regard to the need for
rescission.
- In a specific case, an insurance company was held liable for damages due to the erroneous cancellation of an insurance policy caused
by the wrongful acts of one of its employees. Reinstating the policy did not absolve the insurance company from its obligation to
compensate the policyholder for the harm inflicted. The damages awarded were in the form of nominal damages because no
substantial injury had occurred at the time of cancellation.

In summary, Article 1191 allows for the rescission of a contract when one party fails to fulfill their obligations, regardless of
economic prejudice. The effect of rescission is to annul the contract, restoring the parties to their pre-contractual positions. Reciprocal
obligations, like those in insurance contracts, may entitle the injured party to damages even when the contract is reinstated.

Key Points:

1. In the provided legal case, the sale of shares of a corporation engaged in tourism without prior approval from the Ministry of
Tourism, as required by law, was challenged.
2. The primary issue in this case was whether the sale should be considered void from the beginning (inexistent) or merely rescissible
due to the lack of required approval.
3. The court held that, according to Article 1409(7), the sale is inexistent and null and void from the beginning because any contract
must align with applicable statutes, even without explicit reference to them.
4. A concurring judge suggested that the sale could also be considered rescissible under Articles 1191, 1547(2), and 1599(4) of the
Civil Code due to the seller's failure to deliver the approval of the Ministry of Tourism, as agreed in the contract of sale.
5. Article 1191 of the Civil Code discusses different kinds of obligations, including pure and conditional obligations. It states that if a
party defaults on their obligation, the injured party can either demand compliance or rescission of the contract.
6. Remedies for contract breaches are alternative, not cumulative. The injured party must choose either fulfillment or rescission and
cannot switch between them.
7. The right to rescind is not absolute and is subject to the review by the courts. The injured party needs to seek judicial rescission
through the legal system.
8. The court can allow a period for compliance if there is a just cause for doing so. In the absence of a just cause, the court will decree
rescission.
9. To demand rescission, the injured party should be in a position to comply with their obligations under the contract.
10. The rights of third persons who acted in good faith with the subject matter of the contract in their hands are considered when
applying rescission.
11. Rescission is typically not granted for slight or casual breaches of contract. The violation should be substantial and fundamental to
defeat the purpose of the agreement.
12. Whether a breach is substantial depends on the attendant circumstances, not just the percentage of the amount not paid.

Please note that the provided legal principles are based on the information in the text. Legal decisions can be highly context-specific,
and it's essential to consult a legal expert for advice on specific cases.

This passage discusses various aspects of Article 1191 of the Civil Code of the Philippines, which pertains to rescission and the breach
of contracts. Here are the key points:
1. **Ownership Retained by Seller**: In contracts where the seller retains ownership until the full payment of the price, non-payment
by the buyer is a positive suspensive condition. Failure to pay is not considered a breach, casual or serious, but rather an event that
prevents the vendor from having an obligation to convey title.
2. **Irrelevance of Breach Severity**: It is immaterial whether the infringement of the contract was casual or serious. There can be no
rescission of an obligation that does not yet exist due to the failure of a suspensive condition.
3. **Cancellation, Not Rescission**: In such cases, the appropriate remedy is not rescission but rather cancellation of the contract.
4. **Delay in Payment**: Minor delays in payment may not be considered substantial breaches, especially when dealing with small
quantities or rentals.
5. **Time as Essence**: When time is not of the essence in an agreement, a slight delay in fulfilling obligations is not a sufficient
ground for rescission.
6. **Partial Payments**: Partial payments and willingness to pay the remaining balance can be considered by the courts in assessing
whether a breach is substantial.
7. **Ejectment of Occupants**: The failure to eject occupants, as a condition for the buyer's payment, does not necessarily constitute
a substantial breach.
8. **Waiver of Right**: The right to rescind can be waived, either expressly or impliedly. Accepting delayed payments may imply a
waiver of the right to rescind.
9. **Contract to Sell**: In a contract to sell, payment of the purchase price is a suspensive condition, and title remains with the seller
until full payment.
10. **Sales of Real and Personal Property in Installments**: Different rules apply to sales of real and personal property in
installments.
11. **Judicial Compromise**: Article 1191 does not apply to obligations arising from a judicial compromise, which has the force of a
court judgment.
12. **Arbitration Clause**: Parties cannot treat a contract as rescinded if there's a valid arbitration clause in the contract. Disputes
must be resolved through arbitration as stipulated.

These points clarify when and how rescission or cancellation of contracts can occur under Article 1191 in the Philippines and
highlight various considerations such as the severity of breaches, the role of time, and the impact of arbitration clauses on the right to
rescind.

Key Points:
- Parties can enter into an agreement that allows for the rescission of a contract without the need for judicial intervention when
automatic rescission is expressly stipulated. This stipulation is considered a resolutory condition.
- Unilateral rescission in a contract of sale often involves granting the seller the right to forfeit installments or deposits if the buyer
fails to make full payment by a specified date.
- Article 1191 of the Civil Code does not prohibit parties from including stipulations for automatic rescission in their contracts. The
act of treating a contract as canceled must be communicated to the other party but is provisional and can be reviewed by the courts.

- In cases of extrajudicial rescission with stipulation for automatic revocation, judicial intervention is required to determine whether
the rescission was proper. However, if the other party does not contest the extrajudicial rescission, it takes legal effect.
- In the absence of a stipulation for automatic rescission, a contract's rescission must be invoked judicially. Parties are entitled to
recover what they delivered under the contract if the other party opposes the rescission.
- A compromise agreement allows parties to adjust their positions to settle a lawsuit, but if one party breaches the compromise
agreement, the aggrieved party can enforce the original claim without seeking judicial rescission.
- Rescission is not equivalent to termination in legal terms. Rescission means undoing a contract from the beginning, while
termination refers to ending a contract's existence. The consequences of termination may be anticipated and provided by the contract.

- Article 1192 addresses cases where both parties are guilty of breaching their obligations. The liability of the first infractor is
equitably tempered by the courts. If it cannot be determined which party first violated the contract, the contract is deemed
extinguished, and each party bears their own damages.

The legal concept of obligations with a period, as outlined in Article 1193 of the Civil Code of the Philippines, involves situations
where the fulfillment of an obligation is tied to the expiration of a specific period or term. Here are the key points and a summary:

1. **Two Types of Period:**

- *Suspensive Period (ex die):* In this case, the obligation only begins when a specific day arrives. The obligation exists but is not
yet demandable until that day comes.
- *Resolutory Period (in diem):* The obligation is valid from the beginning but terminates upon the arrival of a specific day.
2. **Definition of Period or Term:**
- A period is a future and certain event upon which the obligation or right depends. This event must necessarily occur, even if the
exact timing is unknown.
3. **Differences Between Period and Condition:**
- As to Fulfillment: A period is a certain event that will happen sooner or later, while a condition is an uncertain event.
- As to Time: A period refers to the future, whereas a condition may refer to a past event unknown to the parties.
- As to Influence on the Obligation: A period fixes the time for the obligation's effectiveness, while a condition causes the obligation
to arise or cease.
- As to Effect on Debtor's Will: A period depending on the debtor's will allows the court to determine its duration, while a condition
depending on the debtor's will invalidates the obligation.
- As to Retroactivity: The arrival of a period generally does not have retroactive effects, while a condition's fulfillment can have
retroactive effects.
4. **Possible Period:** A period must be possible; otherwise, the obligation is void. If the period is impossible, the obligation is
considered void.
5. **Illustrative Cases:** The provided cases help illustrate how the concept of period is applied in various legal situations. They
show how the nature of the period can affect the demandability and fulfillment of obligations.
6. **Types of Period or Term:**
- According to Effect: Suspensive and Resolutory.
- According to Source: Legal, Conventional, and Judicial.
- According to Definiteness: Definite and Indefinite.

In summary, obligations with a period involve the attachment of certain conditions to the fulfillment of an obligation, where the
obligation becomes demandable or terminates upon the arrival of a specific day or event. The nature of the period (whether suspensive
or resolutory) and its specifics can vary, and it is essential to distinguish periods from conditions in legal contexts.