LEGAL ASPECT HANDOUT 4 negotiorum gestio, which takes place when a person without the consent of the owner,
negotiorum gestio, which takes place when a person without the consent of the owner, assumes the
OBLIGATIONS
Article 1156. An obligation is a juridical necessity to give, to do or not to do.
There are three (3) kinds of an obligation under the law: obligation to give, to do, or not to do.
obligation to give- the debtor is obliged to deliver the movable or immovable thing to the
creditor. An example is the obligation to deliver the thing in sale, deposit, or donation.
obligation to do- All kinds of works or services, whether physical or mental. Examples include a
contract of events organizing or professional services like painting or modeling.
obligation not to do- refraining from doing some acts like the obligations of a building proprietor
to refrain from committing nuisance through noise or offensive odor, smoke, and heat.
Elements of an Obligation
Active subject. It is the one who is demanding the performance of the obligation. He is also called
the creditor or obligee.
Passive subject. It is the one bound to perform the prestation to give, to do or not to do. He is also
called the debtor or obligor.
Object or prestation. It is the subject matter of the obligation which has an economic value
or susceptible of pecuniary substitution in case of noncompliance.
Juridical or legal tie. It is the vinculum that binds the contracting parties (e.g., sales contract; service
contract).
Sources of liability (for damages) of a party in an obligation are as follows:
Fraud. incidental fraud which is fraud incident to the performance of an obligation (e.g., delivering
a used, instead of a new, mobile phone). there is an intent to evade the normal fulfillment of the
obligation and to cause damage.
Negligence. the lack of diligence, or carelessness. culpa contractual (negligence incident to the
performance of a contractual obligation).
Delay. those obliged to deliver or to do something incur in delay from the time the stipulated
period for the fulfillment of the obligation has lapsed
Sources of an Obligation
Article 1157 enumerates the sources of obligation, namely: law; contracts; quasi-contracts; delicts
or acts or of omissions punishable by law; and quasi-delicts.
Law. The obligation of a party to fulfill an obligation arises from the law itself. An example of this is
the taxpayer’s duty to pay taxes.
Contracts. This is the duty of the party to fulfill his undertaking in a contract. An example of this is the
duty of the party to pay for the excess number of persons attending a catering event as stipulated in
the contract.
Quasi-contracts. It refers to a lawful, voluntary, and unilateral act based on the maxim that no one
shall enrich himself at the expense of another. The two (2) common forms of quasi-contract are solution
indebiti, which is the payment by mistake, where there is an obligation to return the payment; and
management of an abandoned business, where the obligation is to attend to the business until the
completion of the undertaking and its incidents, or to call upon the owner to relieve him of it, should
he be able to do so.
Delicts. It refers to obligations arising from delicts or crimes, which are governed by the provisions of
the Revised Penal Code (i.e., restitution, reparation of the damage caused, indemnification of
consequential damages; and by the provisions of the Civil Code on damages (i.e., moral, exemplary,
and nominal damages). An example of this is the duty of the culprit to pay actual damages for causing
the death of a person.
Quasi-delicts. Quasi-delict is any act or omission which causes damage to another, there being fault or
negligence, and there being no preexisting contractual relationship between the parties. An example
of this is the duty of the tortfeasor to pay damages for injuries or damages due to his fault, omission,
or negligence.
Diligence Needed
Article 1163 provides that every person with an obligation to give something is also obliged to take
care of it with the proper diligence of a good father of a family unless the law or the stipulation of
the parties requires another standard of care.
Modes of Extinguishing Obligation
Article 1231. Obligations are extinguished by payment or performance; loss of the thing due;
condonation or remission of the debt; confusion or merger of the rights of the creditor and debtor;
compensation; and novation.
Below are examples to illustrate the modes of extinguishing obligations:
In a restaurant, the obligation of the guest to the management who served him a sumptuous food
shall be extinguished upon payment by the guest of the exact amount of the food consumed.
An obligation arising from a contract may also be extinguished upon the loss of the thing due,
provided there is no fault or negligence on the part of the obligor.
Article 1189 (2) explained the meaning of the term “loss.” It states that it is understood that the
thing is lost when it perishes, or goes out of commerce, or disappears in such a way that its existence
is unknown or it cannot be recovered.”
Fortuitous event, also known as force majeure, is a term that exempts an obligor from liability.
(Article 1174). Fortuitous events are extraordinary events not foreseeable or avoidable, events
that could not be foreseen, or which, though foreseen, were inevitable. This may be produced by
2 general causes. By nature, such as earthquakes, storms, and flood; and By the act of men, such as
armed invasion, attack by bandits, and robbery.
Condonation or remission pertains to the act of liberty on the part of the creditor wherein s/he
forgives or remits a debt.
Article 1275 provides that the obligation is extinguished from the time the characters of creditor
and debtor are merged in the same person.
Compensation is the offsetting of the respective obligations of two persons who stand as principal
creditors and debtors of each other, resulting in the extinguishment of their obligations to their
concurrent amount.
Novation pertains to the change or modification of an obligation by another.
Death extinguishes obligations that are purely personal such as partnership and agency.
CONTRACTS
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.
The essential elements of a contract are consent, object certain, and cause of the obligation.
Contract of adhesion is defined as one in which almost all the provisions have been drafted by only
one party, usually a corporation or insurance company.
Characteristics of a Contract
Mutuality of Contracts. Its validity and performance cannot be left to the will of only one of the
parties.
Autonomy of Contracts. The parties are free to stipulate terms and provisions in a contract, as long
as these are not contrary to law, morals, good customs, public order, and public policy.
Relativity of Contracts. Contracts are binding only upon the parties and their successors-in-interest.
Exception: Stipulation in favor of a third person as in a beneficiary of an insurance policy.
Consensuality of Contracts. Contracts are perfected by mere consent, and no form is prescribed by
law for their validity. An exception to this are real contracts such as loan or deposit, and contracts
covered by the Statute of Frauds.
Obligatory Force of Contracts. By the obligatory force of contracts, it constitutes the law as between
the parties who are compelled to perform under the threat of being sued in the courts of law.
Contract Stages
Generation. It is the preliminary stage or process for the formation of the contract. It includes the
bargaining of the subject of obligation and the consideration or cause.
Perfection. It is the birth of the contract.
Consummation. It is the fulfillment of the purpose for which the contract was constituted.
Defective Contracts
Rescissible Contract. It is a valid contract because it contains all of the essential requisites
prescribed by law, but is defective due to injury or damage to either of the contracting parties or to
third person as a consequence of which it may be rescinded through a proper action for rescission.
Voidable Contract. It is a contract that is valid until annulled. The essential elements for validity are
present, but the element of consent is vitiated either by lack of legal capacity of one of the
contracting parties, or by mistake, violence, intimidation, undue influence, or fraud.
Unenforceable Contract. It is a contract that cannot be enforced by a proper action in court unless
it is ratified, because they are either entered into without or in excess of authority or they do not
comply with the Statute of Frauds or both of the contracting parties do not possess the required
legal capacity.
Void Contract. It is considered to be inexistent by operation of law, thus confers no right to any
party.
LEGAL ASPECT HANDOUT 5
Law of Common Carriers
What are the Common carriers?
The primary law that governs common carriers is the Civil Code of the Philippines
Article 1732. Common carriers are persons, corporations, firms or associations engaged in the
business of carrying or transporting passengers or goods or both, by land, water, or air, for
compensation, offering their services to the public.
Common carrier is defined as one holding itself out to the public as engaged in the transportation
of goods or passengers, or both, for hire.
Private carrier is one who, without making the activity a vocation, or without holding himself or
itself out to the public as ready to act for all who may desire his or its services, undertakes, by
special agreement in a particular instance only, to transport goods or persons from one place to
another either gratuitously or for hire.
Nature of the Contract of Carriage
Contract to transport passengers is different in kind and degree from any contractual relation,
and this is because of the relation which a carrier sustains with the public.
Responsibility of common carriers
Article 1733. Common carriers, from the nature of their business and for reasons of public policy, are
bound to observe extraordinary diligence in the vigilance over the goods and for the safety of the
passengers transported by them, according to all the circumstances of each case.
Article 1755. A common carrier is bound to carry the passengers safely as far as human care and
foresight can provide, using the utmost diligence of every cautious person, with due regard for all
the circumstances.
Article 1756. In case of death of or injuries to passengers, common carriers are presumed to have
been at fault or to have acted negligently, unless they prove that they observed extraordinary
diligence as prescribed in Articles 1733 and 1755.
Article 1757. The responsibility of a common carrier for the safety of passengers as required in
Articles 1733 and 1755 cannot be dispensed with or lessened by stipulation, by the posting of
notices, by statement on tickets, or otherwise.
Extraordinary diligence is defined as that extreme measure of care and caution which persons of
unusual prudence and circumspection use for securing and preserving their own property or rights.
Certificate of public convenience (an authorization for the operation of public services for which no
franchise, either municipal or legislative, is required by law) is not a requirement for a common
carrier to incur liability.
Liabilities of Common Carriers for the Acts of Employees and Strangers
Article 1759. Common carriers are liable for the death or injuries to passengers through the
negligence or willful acts of the former's employees, although such employees may have acted
beyond the scope of their authority or in violation of the orders of the common carriers.
The liability of the common carriers does not cease upon proof that they exercised the diligence of
a good father of a family in the selection and supervision of their employees.
Enforcement of Liability of Common Carriers
In case of death or injury caused to passengers, the victim may file a case of breach of contract of
carriage or culpa contractual against the owner of the common carrier.
In case of death or injury caused to a stranger or pedestrian, the victim may file a criminal complaint
against the driver of the common carrier for reckless imprudence resulting in homicide and
damage to property. The victim may also file a civil suit against the common carrier and its driver
on the ground of culpa- aquiliana or quasi-delict.
Damages Recoverable from Common Carriers
Actual damages comprise the expenses for medicine and hospitalization.
Unrealized profits are recoverable as compensatory damages, which shall be fixed by determining
the net yearly income of the injured or deceased passenger and multiplying the same number by
the number of years that he was expected to live or lead a gainful existence as determined by
mortality tables of life insurance companies of the Philippines. The formula used in computing loss
of earning capacity is: Net Earning Capacity = [2/3 x (80 - age at time of death) x (gross annual
income - reasonable and necessary living expenses)].
Moral damages may be awarded when the mishap resulted in the death of a passenger or when the
carrier was guilty of fraud or bad faith, even if death did not result.
Exemplary damages or corrective damages are awarded by way of example or correction of the
public good or when the common carrier acted in a wanton, reckless, and oppressive manner.
Award for death indemnity is in accordance with current rulings of the Supreme Court.
Award for attorney's fees may be recovered when exemplary damages are awarded (Article 2008 of
the Civil Code).
In case moral damages cannot be awarded without proof of the carrier's bad faith, ill will, malice,
or wanton conduct, nominal damages may be allowed under the circumstances as provided under
Articles 2221 and 2222 of the Civil Code.
Nature of Airline, Bus, and Shipping Tickets
The best evidence of a contract of carriage is the passage ticket. An airline, bus, or shipping ticket is a
contract of adhesion considering that all the provisions thereof are prepared and drafted only by the
carrier.
LEGAL ASPECT HANDOUT 6
LAWS REGULATING ACCOMMODATION ESTABLISHMENTS
Hotel. It is a building, edifice, or premise or a completely independent part thereof, which is used
for the regular reception, accommodation, or lodging of travelers and tourists and the provision of
services incidental thereto for a fee.
Resort. It refers to any place with a pleasant environment and atmosphere conducive to comfort,
healthful relaxation, and rest, offering food, sleeping accommodation, and recreational facilities to
the public for a fee or remuneration.
Tourist Inn. Catering to transients, it is a lodging establishment that does not meet the minimum
requirements of an economy hotel.
Apartel. It refers to any building or edifice containing several independent and furnished or semi-
furnished apartments, regularly leased to tourists and travelers for dwelling on a more or less long-
term basis and offering basic services to its tenants, similar to hotels.
Pension House. It is a private or family-operated tourist boarding house, tourist guest house, or
tourist lodging house employing non-professional domestic helpers regularly catering to tourists
and travelers, containing several independent lettable rooms, providing common facilities such as
toilets, bathrooms/showers, living and dining rooms and/or kitchen and where a combination of
board and lodging may be provided.
Motorist Hotel or Motel. It refers to any structure with several separate units, primarily located
along the highway with individual or common parking space at which motorists may obtain lodging
and, in some instances, meals.
Accreditation by the Department of Tourism
Relevant Provisions about DOT-Accredited Establishments
Section 34. Display of Certificate of Accreditation. The certificate of accreditation shall be displayed
in a conspicuous place of the establishment.
Section 35. Non-Transferability of Certificate of Accreditation. The rights over the accreditation shall
be non-transferable.
Section 39. Gambling and Disorderly Conduct. Hotel, resort, tourist inn, motel, apartel, and
pension housekeepers, managers, or operators shall exert all efforts not to allow gambling of any
form, drunkenness, or disorderly conduct of any kind by anyone in the establishment and its
immediate premises.
Section 40. Prostitution and Other Immoral/Illegal Activities. Managers or operators of hotels,
resorts, tourist inns, motels, apartels, and pension houses shall exert all possible efforts not to
permit any person whom they know or have reason to believe to be either a prostitute, a
pedophile, or of questionable character to occupy a room or to enter the premises.
Validity of Certificate of Accreditation. The Certificate of Accreditation shall be valid for one (1) year
from the date of issue unless sooner revoked by the DOT.
National Building Code of the Philippines
National Building Code of the Philippines (Presidential Decree 1096) was adopted in view of the
country's accelerating economic and physical development coupled with urbanization and population
growth. This Code contains technical knowledge on building design, construction, occupancy, and
maintenance.
General Building and Site Requirements
Section 104. General Building Requirements- All buildings or structures as well as accessory facilities
thereto shall conform in all respects to the principles of safe construction and must be suited to the
purpose for which they are designed.
Section 105. Site Requirements- The land or site upon which will be constructed any building or
structure, or any ancillary or auxiliary facility thereto, shall be sanitary, hygienic, or safe.
Building Permits
Section 301. Building Permits. No person, firm, or corporation including any agency or
instrumentality of the government shall erect, construct, alter, repair, move, convert or demolish any
building or structure or cause the same to be done without first obtaining a building permit therefore
from the Building Official assigned in the place where the subject building is located or the building
work is to be done.
General Requirements of All Building by Use of Occupancy
Section 704. Location of Property- (A)General. No building shall be constructed unless it adjoins or
has direct access to a public space yard or street on at least one of its sides. (B) Fire Resistance of
Walls. Exterior walls shall have fire resistance and opening protection xxx.
Light and Ventilation
Section 801. General Requirements of Light and Ventilation. (A)Subject to the provisions of the Civil
Code on Easements of Light and View, and the provisions of this part of the Code [National Building
Code of the Philippines], every building shall be designed, constructed, and equipped to provide
adequate light and ventilation. (B) All buildings shall face a street or public alley or a private street
that has been duly approved.
Section 808. Window Openings- Every room intended for any use, not provided with artificial
ventilation system as herein specified in this Code shall be provided with a window or windows with
a total free area of openings equal to at least ten percent of the floor area of a room, and such
window shall open directly to a court, yard, public street or alley, or open watercourses.
Section 811. Artificial Ventilation- Whenever artificial ventilation is required, the equipment shall be
designed and constructed to meet the requirements for rooms entirely above grade and used as
bakeries, hotel or restaurant kitchens, laundries other than an accessory to dwellings, and boiler
rooms, not less than ten changes of air per hour shall be provided. Light and ventilation refer to an
easement of natural light and allowance of circulation of fresh air unobstructed by erections and
construction.
Sanitation
Section 901. General- Subject to the provisions of Book II of the Civil Code of the Philippines on
Property, Ownership, and its Modification, all buildings hereafter erected, altered, remodeled,
relocated, or repaired for human habitation shall be provided with adequate and potable water
supply, plumbing installation, and suitable wastewater treatment or disposal system, storm water
drainage, pest and vermin control, noise abatement device, and such other measures required for
the protection and promotion of health of persons occupying the premises and other living nearby.
Potable water requirements- for a building used for human habitation shall be supplied from the
existing municipal or city waterworks system.
Sanitary sewage from buildings shall be discharged directly into the nearest street sanitary main
sewers under the existing municipal or city sanitary sewerage system following the criteria set by
the Code on Sanitation and the Environmental Management Bureau which is under the DENR.
Anti-Photo and Video Voyeurism Act of 2009
Republic Act No. 9995, also known as The Anti-Photo and Video Voyeurism Act of 2009, penalizes
"photo and video voyeurism" which means the act of taking a photo or video coverage of a person
or group of persons performing a sexual act or any similar activity or of capturing an image of the
private area of a person/s without the latter's consent, under circumstances in which such person/s
has/have a reasonable expectation of privacy, or the act of selling, copying, reproducing,
broadcasting, sharing, showing or exhibiting the photo or video coverage or recordings of such
sexual act or similar activity through VCD/DVD, Internet, cellular phones and similar means or device
without the written consent of the person/s involved, notwithstanding that consent to record or
take a photo or video coverage of same was given by such person.
Waste Management
Environmental Code of the Philippines (Presidential Decree No. 1152)- the dumping or disposal of
solid wastes into the sea and any body of water in the Philippines, including shorelines and river
banks, where these wastes are likely to be washed into the water is prohibited and might be a
ground for the non-renewal or license to operate within the local government unit concerned.
Ecological Solid Waste Management Act of 2000 (Republic Act 9003)- was enacted to encourage
commercial and industrial establishments, through appropriate incentives other than tax incentives,
to initiate, participate, and invest in integrated ecological solid waste management projects to
manufacture environment-friendly products, conserve raw materials and energy, reduce waste,
prevent pollution and to undertake community activities to promote and propagate effective solid
waste management practices.
Laws Regulating Restaurants
Restaurant is an establishment offering to the public refreshments and/or meals. Bars and pubs may
also be classified under this generic category. Restaurants fall under Secondary Tourism Enterprises,
which refer to facilities and services that may be related to tourism.
Minimum requirements for the operation of restaurants:
Location. The locality and environs, including approaches, shall be with proper ingress and egress.
The facade and architectural features of the building shall be appropriately designed.
Parking. There shall be an adequate, secured parking space provided free to customers.
Reception. A receptionist shall be available to usher in guests. A waiting lounge with a telephone
shall also be provided.
Dining Room. The minimum requirements for the dining room are the following:
Furnishing. The dining room shall be adequate in size, with sufficient and well-maintained
 furniture. Flooring materials shall be kept clean at all times.
Atmosphere. The restaurant shall have a pleasant atmosphere.
Cuisine. There shall be a cuisine of good quality and presentation available during normal
meal hours and served with distinction.
Menu Book/Card. There shall be a menu book or card which shall be presentable, clean,
and easy to read with the menu items listed in a logical sequence.
Linen. All tables shall have clean table cloth and cloth napkins of good quality.
Crockery. No piece of crockery, cutlery, and tableware in use shall be chipped, cracked, or
grazed.
Service and Staff. An adequate number of well-trained, well-groomed, experienced, efficient, and
courteous staff shall be employed.
Bar. The bar shall be well-stocked at all times.
Comfort Rooms. All comfort rooms shall be with good quality fixtures and fittings and provided
with running water.
Kitchen. The kitchen, pantry, and cold storage shall be in good operating condition at all times and
shall be well-equipped and hygienic.
Lighting. Adequate lighting dining rooms, public rooms, comfort rooms, corridors, and other public
areas.
Air-conditioning/Ventilation. All main dining or function rooms shall be fully air-conditioned and/or
well- ventilated.
Maintenance. All sections of the restaurant (e.g., building's exterior and interior, air-conditioners,
kitchen, fixtures, plumbing, etc.) shall be maintained properly at all times.
Fire-fighting Facilities. Adequate fire-fighting facilities shall be provided following the Fire Code of
the Philippines.
Food and Safety Act of 2013
Food Safety Act of 2013 (Republic Act 10611) , is an act to strengthen the food safety regulatory
system in the country to protect consumer health and facilitate market access of local foods and
food products and for other purposes.
Section 14 provides for the specific responsibilities of a food business operator (defined as a
person engaged in the food business including one's agents and is responsible for ensuring that the
requirements of the law are met by the food business under one's control ).
Section 8 of the food law provides for the protection of consumer interests.
Section 37. It shall be unlawful for any person to: Produce, handle or manufacture for sale, offer for
sale, distribute in commerce, or import into the Philippines any food or food product which is not
in conformity with applicable food quality or safety standard promulgated in accordance with the
law
Laws Regulating the Sale of Alcohol
National Internal Revenue Code of 1997 (as amended) has imposed excise taxes on the purchase of
alcohol. The excise tax rates shall be based on the classification of alcohol content as provided under
the law.
The Local Government Code, every government unit shall exercise the powers expressly granted,
those necessarily implied therefrom, as well as powers necessary, appropriate, or incidental for its
efficient and effective governance, and those which are essential to the promotion of the general
welfare.
Laws Regulating Caterers
Caterer is defined as a person, firm, or association providing food and supplies, and sometimes
services, for parties, weddings, and other social functions. A caterer is defined as a provider of food
and provisions.
Crimes Committed Inside Restaurants and Other Tourism-Related Establishments
Poisoning
Article 264. Administering injurious substances or beverages. The penalties established by the next
preceding article (serious physical injuries) shall be applicable in the respective cases to any person
who, without intent to kill, shall inflict upon another any serious physical injury, by knowingly
administering to him any injurious substances or beverages or by taking advantage of his weakness
of mind and credulity.
Article 265. Less serious physical injuries. Any person who shall inflict upon another physical injuries
not described in the preceding articles, but which shall incapacitate the offended party for labor for
ten days or more, or shall require medical attendance for the same period xxx.
Article 266. Slight physical injuries and maltreatment.
Vandalism (Malicious Mischief)
Article 327. Who are liable for malicious mischief. Any person who shall deliberately cause to the
property of another any damage xxx shall be guilty of malicious mischief.
Article 328. Special cases of malicious mischief. Any person who shall cause damage to xxx the
National Museum or National Library, or to any archive or registry, xxx shall be punished.
Article 331. Destroying or damaging statues, public monuments, or paintings. Any person who shall
destroy or damage statues or any other useful or ornamental public monument xxx shall suffer the
penalty xxx.
Swindling (Estafa)
Article 315. Swindling (estafa). Any person who shall defraud another by any of the means
mentioned herein below shall be punished by xxx
Theft
Article 308. Who are liable for theft. Theft is committed by any person who, with intent to gain but
without violence against or intimidation of persons nor force upon things, shall take personal
property of another without the latter's consent.
Article 310. Qualified theft. The crime of theft shall be punished by the penalties next higher by two
degrees xxx if committed xxx with grave abuse of confidence.
Intent to gain is presumed from the unlawful taking of personal property belonging to another.