NAME: ________________________________

TEACHER: _____________________________
CODE: ___________ TIME: _______________

ACC 216 – Obligations and Contracts

Competency Examination – PRACTICE CASES

Please write your answers on the spaces provided on this sheet.

CASE 1

Joey, Jovy and Jojo are solidary debtors under a loan obligation of P300,000.00 which has fallen due.
The creditor has, however, condoned Jojo's entire share in the debt. Since Jovy has become insolvent,
the creditor makes a demand on Joey to pay the debt.

A. How much, if any, may Joey be compelled to pay?

ANSWER: Joey can be compelled to pay only the remaining balance of P200.000, in view
of the remission of Jojo's share by the creditor (Art. 1219).

B. To what extent, if at all, can Jojo be compelled by Joey to contribute to such payment?

ANSWER: Jojo can be compelled by Joey to contribute P50.000 Art. 1217. par. 3, Civil
Code provides. "When one of the solidary debtors cannot, because of his insolvency,
reimburse his share to the debtor paying the obligation, such share shall be borne by all
his co-debtors, in proportion to the debt of each." Since the insolvent debtor's share
which Joey paid was P100,000, and there are only two remaining debtors - namely Joey
and Jojo - these two shall share equally the burden of reimbursement. Jojo may thus be
compelled by Joey to contribute P50.000.00.

CASE 2

Are the following obligations valid, why, and if they are valid, when is the obligation demandable in each
case?

A. If the debtor promises to pay when he likes.

ANSWER: The obligation to pay when he likes is a suspensive condition the fulfillment of
which is subject to the sole will of the debtor and therefore the conditional obligation is
void (Art. 1182).

B. If the debtor promises to pay when he becomes a CPA.

ANSWER: The obligation is valid. It is subject to a suspensive condition, i.e. the future
and uncertain event of his becoming a lawyer. The performance of this obligation does
not depend solely on the will of the debtor but also on other factors outside the debtor’s
control.

C. If the debtor promises to pay if his son, who is sick with cancer, does not die within one year.

ANSWER: The obligation is valid. The death of the son of cancer within one year is made
a negative suspensive condition to his making the payment. The obligation is
demandable if the son does not die within one year (Art. 1185).