LAW ON OBLIGATIONS an average person exercises in
taking care of his property.
CHAPTER 2 – NATURE AND
2. To deliver the thing. (Art. 1163)
EFFECT OF OBLIGATIONS
(ARTICLES 1163-1178) • This involves placing the thing in
the possession or control of the
creditor either actually or
DETERMINATE THING constructively.
• A thing is determinate when it is 3. To deliver the fruits of the thing. (Art
particularly designated or physically 1164)
segregated from all others of the same 4. To deliver its accessions and
class. (Art. 1460). accessories even if they have not been
• Examples: A 2021 Toyota Corolla with mentioned. (Art. 1166)
engine No 12345, body no. 546611, and
plate no. ABC123; my only wristwatch;
the house located at 234 Happy Street, FRUITS
Sampaloc, Manila; my horse named Kinds of fruits
“Black Stallion.” Natural Fruits - They are the
spontaneous products of the soul
and the young and other
GENERIC THING products of animals.
• A thing is indeterminate or generic
when it is not particularly designated or Industrial fruits - They refer to
physically segregated from all others of those produced by land of any
the same class, i.e, one of a class. kind through cultivation or labor.
• Examples: A horse, a car P10,000.00. Civil fruits – They refer to fruits
which are the result of a juridical
relation, such as the rent of a
OBLIGATIONS OF ONE OBLIGED TO building, price of lease of land
GIVE A DETERMINATE THING and other property, and the
1. To take good care of the thing with amount of perpetual or life
the diligence of a good father of a family annuities.
unless the law or agreement of the • The creditor has the right to the fruits
parties requires another standard of of a thing from the time the obligation
care. (Art. 1163) to deliver it arises. However, he shall
• Diligence of a good father of a acquire no real right over it until the
family means the ordinary care that thing has been delivered to him.
• When obligation to deliver the thing performance of his obligations, or
arises contravention of the tenor thereof.
If the obligation is a pure
obligation or one whose
REMEDIES OF THE CREDITOR
performance is not subject to a
suspensive period or suspensive • If the debtor fails to perform his
condition, the obligation to obligation to deliver a determinate thing
deliver arises from perfection. (specific real obligation)
To compel the debtor to make
If the obligation is subject to a
the delivery + damages;
suspensive period or suspensive
To demand rescission or
condition, the obligation to
cancellation of the obligation +
deliver arises upon the arrival of
damages; or
the term or the fulfillment of the
To demand damages from the
condition.
debtor (in case this is the only
feasible remedy).
RIGHTS OF THE CREDITOR
• If the debtor fails to perform his
• Personal right -This is a right that may
obligation to deliver a generic thing
be enforced by one person on another,
(generic real obligation)
such as the right of the creditor to
demand the delivery of the thing and its To ask that the obligation be
fruits from the debtor. complied with at the expense of
the debtor; and
• Real right – This refers to the right or
power over a specific thing, such as
To demand damages from the
possession, ownership, or mortgage,
debtor. Remedies of the creditor
which is a right enforceable against the
whole world. This the right acquired by • If the debtor fails to perform is
the creditor over the thing and its fruits obligation in obligations to do (positive
when they have been delivered to him. personal obligation)
If the debtor fails to perform the
obligation or performs it but
OBLIGATIONS OF ONE OBLIGED TO
contravenes the tenor thereof
GIVE AN INDETERMINATE THING
(in violation of the agreement):
1. To deliver a thing which is of the
quality intended by the parties Creditor may have the
considering the purpose of the obligation executed at the
obligation and other circumstances. expense of the debtor; and
Creditor may demand
2. To be liable for damages in case of
damages from the debtor.
fraud, negligence, or delay, in the
• If the debtor performs the obligation FRAUD
but does it poorly:
• Fraud is the deliberate or intentional
Creditor may have the same be evasion by the debtor of the normal
undone at debtor’s expense; and compliance of his obligation.
• Synonymous with bad faith.
Creditor may demand damages
from the debtor. Remedies of • Fraud under Art. 1170 refers to the
the creditor fraud committed by the debtor in the
performance of his obligation.
• If the debtor does what has been
forbidden him (negative personal • A waiver of an Action for future fraud
obligation) cannot be waived. If there is an
agreement for its waiver, the same is
The creditor may demand that
void. (Art. 1171) Thus, the debtor will
what has been done be undone;
still be liable for damages if he commits
and
fraud in the performance of his
obligation despite the waiver.
The creditor may demand
damages from the debtor. • A waiver of an action for past fraud
may be waived, since the commission of
fraud can no longer be encouraged.
DAMAGES Such waiver is an act of liberality on the
part of the creditor
• Damages signify the money
compensation awarded to a party for
loss or injury resulting from breach of
NEGLIGENCE
contract or obligation.
• It is the omission of that diligence
• Those who, in the performance of
which is required by the nature of the
their obligations, are guilty of fraud,
obligation and corresponds with the
negligence, or delay, and those who in
circumstances of the person, of the
any manner contravene the tenor
time, and of the place. (Art 1173).
thereof, are liable for damages (Art.
1170) • It is the failure to observe for the
protection of the interest of another
• Grounds for liability to pay damages
person, that degree of care, precaution,
Fraud and vigilance which the circumstances
Negligence justly demand, whereby such other
Delay person suffers injury.
Contravention the tenor of the
• The test of negligence is whether the
obligation.
defendant in doing the alleged negligent
act used that reasonable care and
caution which and ordinary person 2. Mora accipiendi – Delay on the part
would have used in the same situation. of the creditor. This exist when the
creditor refuses to accept the thing due
• If the law or contract does not state
without justifiable reason.
the diligence which is to be observed in
the performance of the obligation, the 3. Compensatio morae – Delay in
debtor must observe the diligence of a reciprocal obligations. i.e., both parties
good father of a family. are in default. Here, it is as if there is no
delay.
KINDS OF NEGLIGENCE
DELAY (GENERAL RULE)
• Contractual negligence (culpa
contractual) or negligence in contracts • GR: The debtor incurs in delay from
resulting in their breach. Not a source of the time the creditor demands
obligation. fulfillment of the obligation, but the
debtor fails to comply with such
• Civil negligence (culpa aquiliana/quasi-
demand (no demand, no delay, as a
delict) or negligence which by itself is
rule).
the source of an obligation between the
parties not so related before by any pre- • Requisites of delay by the debtor
existing contract.
1. The debtor does not perform his
• Criminal negligence (culpa criminal) or obligation on the date it is due.
negligence resulting in the commission
2. The creditor demands (judicially
of a crime.
or extrajudicially) the performance
of the obligation.
DELAY 3. The debtor does not comply with
the creditor’s demand.
• Delay or default or mora is the non-
fulfillment of an obligation with respect
to time.
DELAY (EXCEPTIONS)
• When there is performance by a party
KINDS OF DELAY in reciprocal obligations
1. Mora solvendi – Delay on the part of • When the law so provides
the debtor
• When demand would be useless
• Ex re – Delay in real obligations
• When time is of the essence
(obligations to give)
• When the obligation so provides
• Ex persona – Delay in personal
obligations (obligations to do)
FORTUITOUS EVENTS
• Except in cases expressly specified by
the law, or when it is otherwise
FORTUITOUS EVENTS (GENERAL RULE)
declared by stipulation, or when the
nature of the obligation requires the • General rule: No person shall be liable
assumption of risk, no person shall be for fortuitous events, i.e., his obligation
responsible for those events which will be extinguished.
could not be foreseen, or which, though
• Exceptions to the rule (Art. 1174):
foreseen, were inevitable (fortuitous
events). When the law expressly provide
for liability even in case of
• Examples: Natural calamities or acts of
fortuitous events (such as that
God such as earthquake, typhoon and
provided in Art. 1165 where the
lightning; and acts of man (“force
obligor is liable for fortuitous
majeure”) such as war and armed
events if he delays or has
robbery.
promised to deliver the same thing
to two or more persons who do
not have the same interest).
FORTUITOUS EVENTS (REQUISITES)
1. The event must be independent of When the parties have declared
the human will or at least of the liability even in case of fortuitous
debtor’s will; event.
2. The event could not be foreseen, or if
When the nature of the obligation
foreseen, is inevitable;
requires the assumption of risk
3. The event must be of such a character (such as the obligation of an
as to render it impossible for the debtor insurer who must pay the policy
to comply with his obligation in a holder even if the loss is caused by
normal manner; and a fortuitous event if the cause
thereof is the risk insured against).
4. The debtor must be free from any
participation in, or the aggravation of,
the injury to the creditor, that is, there
PRESUMPTIONS ON RECEIPT OF
is no concurrent negligence on his part.
PRINCIPAL OR OF LATER INSTALLMENT
Absence of any of the above
• The receipt of the principal without
requisites would prevent the obligor
reservation as to interest, shall give rise
from being exempt from liability.
to the presumption that the interest has
been paid.
• The receipt of a later installment If the right is by nature not
without reservation as to prior transmissible
installments, shall give rise to
presumption that such prior
installments have been paid.
• The above presumptions are
disputable; hence, they may be rebutted
by contrary evidence. If the
presumption is conclusive, then no
evidence to the contrary may be
admitted.
REMEDIES OF CREDITOR TO ENFORCE
PAYMENT OF CLAIMS AGAINST
DEBTOR
• Pursue the property in the possession
of the debtor, except those exempts by
law.
• Exercise all the rights and bring all the
actions of the debtor except those
personal to him (accion subrogatoria).
• Impugn the acts which the debtor may
have done to defraud his creditors
(accion pauliana)
RULE ON TRANSMISSIBILITY OF RIGHTS
AND EXCEPTIONS THERETO
• General rule: All rights acquired in
virtue of an obligation are transmissible.
• Exceptions:
If the law prohibits the
transmission of the right.
If the parties agreed against
transmission.
