Section 2- Object

of Contracts
 ART. 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. (1271a)
ART. 1348. Impossible things or services cannot be the object of
contracts. (1272)
Concept of object of a contract

• The object of a contract is its subject matter. (Art. 1318[2].)

Kinds of object of contract

• Object certain is the second essential element of a valid
contract. (Ibid.) The object may be things (as in sale of
property), rights (as in assignment of credit), or services
(as in agency).
Requisites of things as object of contract
(1) The thing must be within the commerce of men, that is, it can
legally be the subject of commercial transaction (Art. 1347.) 599
(2) It must not be impossible, legally or physically (Art. 1348.)
(3) It must be in existence or capable of coming into existence (see
Arts. 1461, 1493, 1494.) and
(4) It must be determinate or determinable without the need of a
new contract between the parties. (Arts. 1349, 1460, par. 2.)
Requisites of services as object of contract
(1) The service must be within the commerce of men;
(2) It must not be impossible, physically or legally (Art. 1348.); and
(3) It must be determinate or capable of being made determinate. (Arts. 1318[2],
1349.)

Rights as object of contract

• As a general rule, all rights may be the object of a contract. The exceptions are when
they are intransmissible by their nature, or by stipulation, or by provision of law. (Art.
1311, par. 1.)
(1) Outside the commerce of men — Things of public ownership such as sidewalks,
public places, bridges, streets, etc. things that are common to everybody such as
air, sunlight, rain, etc.
(2) Impossible, physically or legally — Prohibited drugs and all illicit objects to kill a
person, etc. (illicit things or services are also outside the commerce of men.) to get
soil from planet Jupiter to construct a building in one day etc.
(3) Determinable things — All the cavans of rice in a warehouse all the eggs in a
basket my land with the smallest area the land at the corner of a particular street
etc.
(4) Future things or rights — Things to be manufactured, raised, or acquired after the
perfection of the contract such as wine that a vineyard is expected to produce
wool that shall thereafter grow upon a sheep rice to be harvested next harvesting
season milk that a cow may yield eggs that hens may lay young animals not yet in
existence, etc. (Sibal vs. Valdez, 50 Phil. 512 [1927].)
(5) Intransmissible rights — Political rights such as the right to vote family, marital,
and parental rights right to public office, or to run for public office, etc.
Meaning of future inheritance.
• Future inheritance is any property or right, not in existence or capable of
determination at the time of the contract, that a person may inherit in the future.
(Blas vs. Santos, 1 SCRA 899 [1961].)

Validity of contracts upon future inheritance.

• Except in cases expressly authorized by law, a contract concerning future inheritance
is void (Art. 1409[7].)
(1) In the case of donations by reason of marriage between future spouses with respect to
their future property to take effect, only in the event of death, to the extent laid down by
law in testamentary succession (see Art. 84. family code.) and
(2) In the case of partition of property by act inter vivos by a person ( owner or source of the
property) to take effect upon his death. (Art. 1080; see Arroyo vs. Gerona, 58 Phil. 226.)
Kinds of impossibility
1. Physical — when the thing or service in the very nature of things cannot
exist (e.g., a monkey that talks) or be performed. With particular reference to
services (see Arts. 1266, 1267.), the impossibility may be:

(a) Absolute — when the act cannot be done in any case so that nobody can
perform it (e.g., to fly like a bird, etc.) or
(b) Relative — when it arises from the special circumstances of the case (e.g.,
to make payment to a dead person, to drive a car on flooded highways, etc.)
or the special conditions or qualifications of the obligor (to paint a portrait by
a blind person, etc.) or
 j
2. Legal — when the thing or service is contrary to
law, morals, good customs, public order, or public
policy. An act is contrary to law, either because it
is forbidden by penal law (e.g., to sell prohibited
drugs, etc.) or a rule of law makes it impossible to
be done (e.g., to make a valid donation of real
property without a public instrument [Art. 749.],
to make a valid will, where the testator is under 18
years of age [Art. 797.], etc.)
ART. 1349. The object of every contract must be
determinate as to its kind. The fact that the
quantity is not determinate shall not be an
obstacle to the existence of the contract,
provided it is possible to determine the same,
without the need of a new contract between the
parties. (1273).
Quantity of object of contract need not be determinate
• The object of a contract must be determinate as to its kind
or at least determinable without the necessity of a new or
further agreement between the parties. It need not be
specified with absolute certainty. The same is true of the
quantity of the object of the contract. It is sufficient that it
is possible to determine the same without the need of a
new contract between the parties.
SECTION 3. —
Cause of Contracts
ART. 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 benefi t which is remunerated; and in contracts of pure benefi
cence, the mere liberality of the benefactor. (1274)
• Cause distinguished from object.
In a bilateral or reciprocal contract like purchase and sale,
the cause for one is the subject matter or object for the
other, and vice versa.
Hence, the distinction is only a matter of viewpoint.
• Classification of contracts according to cause.

(1) Onerous or one the cause of which, for each contracting party,
is the prestation or promise of a thing or service by the other.
(2) Remuneratory or remunerative or one the cause of which is
the service or benefit which is remunerated.
(3) Gratuitous or one the cause of which is the mere liberality of
the benefactor or giver, such as commodatum; pure donation;
guaranty or suretyship unless there is a stipulation to the contrary
ART. 1351. The particular motives of the
parties in entering
into a contract are different from the cause
thereof. (n)
 MOTIVE VERSUS CAUSE

• Motive my vary while cause is always the same.

• Illegal cause makes the contract void, but illegal
motive does not necessary render the contract
void.
ART. 1352. Contracts without cause, or with
unlawful cause , produce no effect whatever. The
cause is unlawful if it is contrary
to law, morals, good customs, public order or public
policy.
• Requisites of cause.

The following are the requisites of cause:

(1) It must exist at the time the contract is entered into
(2) It must be lawful (Ibid.); and
(3) It must be true or real.
ART. 1353. The statement of a false cause in
contracts shall render them void, if it should
not be proved that they were founded upon
another cause which is true and lawful.
• Effect of falsity of cause

By falsity of cause is meant that the contract states a

valid consideration but such statement is not true.
A false cause may be erroneous or simulated.
ART. 1354. Although the cause is not stated in the
contract, it is presumed that it exists and is lawful,
unless the debtor proves the contrary.
Cause presumed to exist and lawful

It is not necessary that the cause be expressly stated in

the contract. The presumption is that the cause exists and
is lawful unless the debtor proves the contrary. This
presumption is in accord with the natural order of things.
ART. 1355. Except in cases specified by law, lesion or
inadequacy
of cause shall not invalidate a contract, unless there
has been fraud, mistake or undue influence.
Meaning of lesion
Lesion is any damage caused by the fact that the price is
unjust or inadequate.

It is injury suffered in consequences of inequality of

situation, by one party who does not receive the full
equivalent for what he gives in a commutative contract,
like a sale.
Effect of lesion or inadequacy of cause

(1) General rule — Lesion or inadequacy of cause (e.g., price of

thing sold) does not of itself invalidate a contract.
(2) Exceptions. — Lesion will invalidate a contract —
(a) when there has been fraud, mistake, or undue influence
and
(b) in cases specified by law.
(3) Related provisions