LESSON 4: GENERAL CONCEPTS OF OBLIGATIONS AND CONTRACTS

 If you have the juridical capacity and capacity to act, you can take action with

legal effects.

 You must be fit in entering contracts; consent; understand the liabilities or

consequences that will be imposed on you in case of breach of contract.

 Obligations- juridical necessity to give or to do or not to do.

 Juridical necessity- there must be an obligation on the part of the other party to

give, to do, or not to do; to give something, to do is to make an act of service,

not to do something which is against the agreement with the other party.

Elementsof the Obligation and Contracts:

absence of an element the obligation becomes void

1. Juridical tie- the one which minds the party’s obligation; driving force of the

obligation so that ex. contract of sale, the buyer will give money to the seller, the

seller has the obligation to turn over the thing.

2. Active subject- oblige or creditor is the ones who will ex. contract of loan, creditor

-- lends money to the debtor.

3. Passive subject- who will be subject to the obligation. Ex. contract of loan, if the

creditor lets the debtor borrow money, the debtor has the obligation to return

the money w interest.

4. Object or Prestation- fact prestation or service which constitutes the object of the

obligation.
  Although these are the elements, there are still contracts that need formal

requisite—must be in writing ex. contract of sale of property esp. sa yuta, the

contract must be written, must be signed by both parties, notarized for it to be

valid. The absence of an element will make the contract void.

Classification of obligation:

1. Pure and conditional- pure: walay condition; conditional: paghatag sa sa

obligation is subject to conditions sa happening of the event. Ex. I promise to

give A 5k right away, pag demand ni A, it is demandable na ang obligation nako

to give 5k without conditions. It would be diff if I say I will give A 5k after she

graduates in 2023. A cannot demand payment right away because she has to

fulfill first the condition before the obligation takes place.

2. Will of Period- it is within a specific time ex I will give A 5k on 2021—it is within a

period without no condition.

3. Alternative or facultative- alterative: nay 3 ka objects which are the subj of the

obligation og ang paghtag sa usa ka object mao nanay syay maka extinguish or

makawagtang sa obligation. Ex. Naa koy sing sing, car, ref, ni ana ko ni A na

tagaan tekag usa ani nila akoy mag choose, ring ako ihatag, paghatag ko sa ring

ma extinguish na ang obligation but in case sa absence sa ring, ako ang may

right na mohatag kung unsa ako mahatag out of katung 2 na nabilin or si A ang

mo choose kung unsay iya ganahan—facultative, if mawagtang ang butang, the

debtor wil be given an option either to get the thing that is equivalent of value or

to get the equivalent money and after it mawala ang obligation sa usa na

mohatag.

4. Joint or Solidary- joint—ang pagbayad is separate kay naa may mangutang og

groupings, ex mag suon mo, 5 mo, nangutang 1 mil, tag 200k mo, if ever

makabayad naka sa imo 200k, extinguish na ang obligation sa imoha na part but
 not completely extinguish kay ang imong uban wa pa, pwede nimo refunan pero

dapat bayaran ka nila. Solidary—anyone can pay. 4 mo nangutang 1 mil nya di

kabayad ang 3, pwede ikaw lang magbayad para ma extinguish. Ang joint limited

lang kung pila imo share sa solidary u can pay more than ur share provided u

nanghid sa imo co debtors na ikaw mag bayad kay if di, imo sila gi step in sa

ilang rights without their consent so pwede sila di mo bayad ato if ever.

5. Divisible and indivisible- divisible: obligation na mabahin bahin; indivisible: kay

dili. With the penal clause, there is an obligation but if theres a failure of doing it,

there will be a penalty aside from the fulfillment of ur principal obligation ex.

Gipahimo ka og balay as architect nya wa ka naka fulfill sa imo obligation na

dapat build it on time, pwede ka mapenalltehan but pwede sab nimo humanon

ang balay but may penalty naka. Bcos delay in the performance of the obligation

is subject to damages.

Sources of the obligation

1. Law,

2. Contract (acts or omission punished by law, playsaydeliks ?)

 Mao ni sya sa sources of juridical tie ex. Sa contract of loan is to source of the

obligation wherein the creditor lets the debtor lend money in return, ang creditor

maningil ni debtor para sa iya gi huwam plus interest and damages. The one that

governs the contract between thse two parties is the contract of loan that they

signed (source of the obligation)

 After determining the source of the obligation, u have to know the rights and

obligation nila 2 because failure to do, to give, not to do something w u agreed

of, ma liable mo ana sa damages. Ex. U said to ur bf na manghuwam ka og 500k

nya bayaran lang nimo by dec 2021 nya ni abot na ang date nya nanukt na imo

bf, nya di ka kabayad—if due and demandable, nya wala pa sya ni bayad, the next
 day after for failure to pay pwede na sya mo bayad sa penalty and penalty is a

form of damages. Dapat makahibaw ta sa nature and effects of obligation para di

ta ma charge ng damages for damages of ur actions.

 What are the obligations of a person obliged to give a thing, for those persons

who are obliged to give a specific thing—a thing that is segregated by other

through numbers. Ex cars—tanan generic sila but if may plate num, 123, ang usa

kay 456, the former will be converted from generic into specific.

Ang obligations ng tawu na mohatag ng specific thing:

1. To perfrom the obligation specifically ex. Painter ka I want u to paint me mona

lisa—dapat by urself lang og walay uban kay ma breach na ang inyo contract if

nay uban and u will be liable for damages.

2. To take care of the thing w a proper diligence of a good father of a family unless

others’ standard of care is required by law or stipulated by the parties. Ex. U

borrow something from a person its ur obligation for ex nag borrow ka ng Ferrari

with abc123 plate number, specific thing, its ur obligation as the borrower of the

thing with the diligence of the good father of the fam—this is the default. Unless

mo ana ang party na dapat imo ni ing anaon aside sa imo ampingan. If mo agree

ang borrower, the obligation is binding bet the 2.

3. To deliver all accessions and accessories of the thing although not mentioned . Ex

nipalit ka og cp, if it is stipulated under marketing description na apil ang charger

and so on, then all of them must be delivered to the buyer. If u fail to deliver, to

do, to give specific things in favour of one person, failure to do so will amount to

damages because under article 1170 of the civil code of the ph, those who are in

the performance of their obligation, guilty of fraud, delay of services will be liable

to damages.
Unsa napud ang obligation if generic ang thing?

1. Ang person dapat I delver ang thing w/is neither of superior nor inferior of

quality taking into consideration the purpose of the circumstances of the

plantation.

 Sa specific, kahibaw nata unsay I deliver kay it is clearly specified kung unsa na

utang ang gi expect. Sa generic, tagaan og car si A. So car ra, unsa na car?

Ang iya I deliver kung unsay agreement. For ex, kung pick-up ang gi ask, pick-

up jud ang ihatag bisan dili specific. Dili ko mo down sa wigoo or motorcycle

unless I ratify ni A na ok wigoo nalang kaysa naman wla kay mahatg. If there is

a ratification, the contract’s defect will be cured. The obligation will be

extinguished because A accepted the thing of inferior qual bisag wala to syay

obligation to accept it because A can demand that he be given the pick up

truck which I promised.

2. To be liable for damages in case of delay, fraud, negligence, contra version, of the

tenant there of (?)

 Ex.paayo kag car nya wa ka kahibaw sa plate num tung usa. 3 imo gipaayo

nya wa nimo gi specify kung unsa na car imo gi demand na maoy unahon, ni

ana raka na pauyohon sila, ma liable a for damages if di nimo ma deliver ang

iyahang thing na iyahang ganahan ipa deliver sa iyaha but that is subject to

clear instructions kung unsa gyud iya ganahna ma deliver.

3. Regarding the obligation to do, (balik ta sa definition ng obligation ang

contracts: juridical necessity to give—generic or specific thing, to do, not to do)-

obligation to perform somethimg legal, if the person obliged to do something

fails to perdorm the obligation. What are the rights of the oblige? Ang painter wa

ni follow sa inyong agreement—1. To have the the same executed at the cost of

the obligor. Ex gi paint nimo og mona liza pero lahi iya gi paint. Mo ana jud ka na
 no di ni mao ako gi pa paint nimo dapat si mona liza man. Dapat usbon jud to

because the oblige doesn’t have the obligation to accept if its a violation of the …

of the obligations

4. To ask that the obligation be complied with the expense of the debtor. Ex

ngpahimo balay nya ang gusto nimo kanang Mediterranean style pero walay

atop. Nya ang katung builder mas ganahan sya og may atop pero ang nag ask

kay wa naka uyon, so ang nagpahimo ni ana na di na sya mo dawat, usbon jud na

kay lahi man ila agreement. So makabayad jund ang nag builder, siya ang mo

shoulder sa expenses sa pag pa usab kay wa man sya ni follow sa tenor of the

obligation or stipulation of the parties na dapat ing anion ang balay.

5. Breach of obligation- refusal or failure of one person to perform his obligation

based on the stipulation of the contract or law. Ex. Its ur obligation not to sell the

property for at least 10 years and after 7 kay mo gi baligya. Imo gi breach ang

provision sa contract so u failed ur responsibility no to sell the prop for at least 10

yrs. Unsay effect? U will be liable for the damages to the person who gave u the

instruction not to sell it in a span of 10 yrs.

 It is important to know the consequence of ur act, because damages will be

imposed to you for the failure to comply, to do, not to do, something which u

agree with someone whom u deal with.

 Delay- faiure of the party to perform his obligation on time—this will damages

start to kick in. ex if nangutang imong friend nya ni ana mag bayad sya by 31 and

as u demand by 31 ya pa sya nag bayad, after 31 it will be a delay already. Pwede

nimo I ask her or compel to deliver or pay in full amount otherwise mo file for

damages for that person and interest will be imposed on him. If mag pa utang

man gani nya mo hatag ta og interest, put it in writing so that the court can pay
 cognizance on that. CC provides that imposition of interest must be in writing

signed by the debtor and creditor in order for the contract t be valid.

Modes Or Extinguishment

 After nako ma fulfill ang ako obligation, once the performance of the obligation

is done, the contract is extinguished and no cost of actions will arise against the

other party to another one unless the contract was breached, not performed

successfully the way the parties agreed on then ure not yet done with ur

obligation.

 A contract of sale is a valid contract, it has a corresponding obligation. Ni Palit ka

sa pharmacy nya gi hatagan ka og tambal nya ni bayad ka, the contract is

considered as sold and wa nay cost of actions to each other. Ex. Ng pahimo ka og

balay nya wa pa nahuman according sa stipulation kung kanusa dapat mahuman

(date of completion). It’s up to you what stipulations u are going to make as

against those who created ur house. If it has delay in the performance of the

obligation, check the contract first, if it says a minimal delay does not constitute

a delay and will be given a chance, then dili pa ta maka demand ana. But if

nakabutang na due and demandable detsu, other party will be liable for damages

for the delay of building the house.

Extenguishment Of The Obligation

 PALOMECANO:

- pa: payment of performance. When nangutang ka and u are asked to pay

the money that u owe to them and nakabyad ka on time w interest, after it, ur

obligation to pay will be extinguished.

to the other party but due to the event or acts of God, u fail t do so, u don’t have the

obligation to deliver that thing because it is lost already. Ex, I will give my bro Ferrari w

plate num 123 after he passes the board exam. Wala pa ag exam nag bagyo nya na

anod ang car. Ang baha is an act of god or fortuitous event. Since naanod naman ang

specific thing, my bro cannot demand me anymore bo=cos its not my fault unless nay

negligence, my bro can ask for the value of the car plus damages for failure of fulfilling

the obligation.

 Lahi ang rule sa loss of the thing due with regards to specific and generic. Sa

specific, once mawagtang ang butang dili obliged ang person mo hatag og

anther. Sa generic kay ex tagaan tekag baka. Wla may plate number na or same

same lang ang itsura sa baka. Since di man specific, (unless if gi butang na nay

pink spots or thingy sa baka ma specific ni) generic man ni, dili ma extinguish ang

obligation inless mo hatag ka og thing ogf equivalent.

-me:merger- the character or pesriality of the buyer and seller are one and the same.

Ex. Nangutang ko sako friend og 100k, ang akong riend na ako gi utangan nangutang

napud sakong friend og 100k, og kaning akong friend na nguatng og 100k, nangutang

napud nako og 100 (?). murag nabalik, ako ang nagutang og ako pud ang gi utangan sa

same rana person, mura na nuon ikw ang nahimo na debtor and creditor on ur won

right na same ramog character, so ma extinguish na imong obligation.

-no: Novation- there is a change of the subject or the object depends on the

circums. Ex debtor ka, nay person na butoan og ganahn mo assume sa imong

obligation, sya nalang magbayad, nya mo sugot si creditor, important na may consent

sa creditor to check if worth it sya mo puli kay basin pobre siya nya di diay jud

makabyad. Makahibayo dpat ang creditor sa novation or changes para ma determine

creditor og siya sa novation, ma extinguish na iya obligation kay nabalahin namn.

Novation is simpy the transfer of the obligation w the consent of the person na pulihan

niya og sa tawu na may obligaysyon siya na abyaran.

- co: Compenstion- naa kay utang nako og naa pud koy utang nimo on the sme

value or object, table mo. Ex. Nangutang ko og 100 k nya ikaw pud. Di pwede na

nangutang ka og 100k nya ko mangutang ko og ref—ang mahitabo I baligya nalang I

ref para ma onert ang kwarts—para offset, dapat parihas sila, di pwede magka offset

ang things na di pariha og value.

 Contract- meeting of the minds of the 2 person reg a thing or obligation with

consideration. This is important because sa obligation and contracts kay anything

that u do will be subject to damages. Damages—it is important for u to know the

elements of the contract to determine if the contact entered by someone is valid

(it meets all the elements of the contract) or void (it lacks the requisites)
 2 kinds:
- Consensual: perfected by mere consent. Consent is when the meeting of the

minds of the 2 persons has been realized and dapat freewill w no coercion,

intimidation, and force. To be perfected, it must be done voluntarily w the

knowledge and will. Ex there is a fear that’s why na pugos ka, there is a defect

of the contract which is subject to ratification or recession. Ratification—

although nay threat sa una og sa mga nilabay na mga tuig na realize nimo na

okay lang diay, di naka ganahan ipa ratify ang contract, okay rani. Ma valid ni

because under the obligations and contract, u have to realize there is a

prescriptive priod or a period to nullify the contract. Sa marriage, if nay threat

or fear, after 5 years from the time of celebration, di na nimo pwede mapa
 nullify inyo marriage because mura man lang imo nalang gi ratify or

gidawat/pasagdan/ tolerate.

 Before, rape was a private crime now, public na meaning the parties cannot give

the discretion whether mo kiha or dili but ang state na ang mo prosecute.

Regardless na gipaksalan ng victim ang nang rape sa iya, it does not discredit na

ni commit sya og rape. Marriage cannot be a reason to extinguish a crime. Ma

prosecute gihapon bisan I marry pa niya ang iya victim. Public crime- public

interest is involved ex. murder, arson.

- Real contracts: real properties are involved. Ex contract of sale sa yuta, it must

be in writing, signed by parties and notarized for it to be valid and

enforceable as against 3rd persons. Once ma notarize na sya, it will be

converted from private to public document- everyone can access it and use it

as evidence without further alleging sa court na kani siya kay public document

because notarization of a docu is a conversion.

—solicit, valid dapat di pwede nang mga shabu shabu. Dapat valid ang

prestation or object, naa say dapat consideration.

 Verbal and written contract, but it doesn’t make a contract invalid if

its not written pero nay uban contract na dili valid kung di isuwat

e.g., contract of sale sa yuta. Kung contract of loan, valid bisan

walay written basta nay evidence na ngutang siya, og sige sya

bayad nimo though di ka kayo ka impose ng interest kay wa man

gisuwat. It depends on the formality kung unsay sakto na medium

para valid ang contract.

ang consideration, must be legal and doable dili impossible ,

because if someone imposes an impossible thing ex. Tagaan tekag

1 mil kung maka lupad ka sa moon w/o any medium. But IF ni

agree, void ang contract kay klaro man na impossible.

- Recessible: ang defect is caused by injury or damage to either one of the

parties or 3rd persons. Effect is valid and enforceable until rescinded by a

competent court. Recessible ang contract kay nay damage—one party is

injurded beause of the agreement ex, guardianship- ang us aka tawu is

incompetent and minor ya gi appoint ka sa court as his guardian, and gi gasto

niya ang kwarta sa minor in a way ni affect og at least 25% sa value sa iya

prop, ang contract na iya gi enter sa sa katung guardian og sa other na tawu,

since ni affect man sa prop ni minor, the contract will be void or recissible

because there is an injury the other party.

- Defected:

- Voidable: viciation of consent or vice of consent wherein ang usa ka party

voidable ex contract of marriage—if ang usa kay wala freewill to decide, kani

siya na injured party pwede mo kiha for the annulment of the contract kay the

time ni enter sa contract, nay vice of consent. Sa voidable, usa ra jud dapat sa

parties ang injured due to vices or defects sa consent

- Unenforceable: 2 kabuok vice of consent ex ang usa gi tutukan ig pusil nya

ang pares kay 17 yo pa, duha kabuok ang defect kay u cant enter into a

contract of marriage if ure not 18 plus. Effect is cannot be enforced by a

proper action in court. Silang duha ang nay defect or vices of consent nan a

violate or statute of frauds- if the law provides na Dapat in writing ang pag

sale sa yuta, unenforceable ni if walay in writing kay wa ni sunod sa formal

frauds ni, if di gani na nimo I comply with, the contract will be unenforceable.

- Void: nawagtang ang contract because of the defects due to law ex minors

cannot marry. Marriage is void because it lacks the essential element that they

should be at the age of majority. Ex. 8 yrs old nya perte ka datu tas nipalit sya

og 300 million nga balay kay kita man siya kung unsoan pag gasto sa kwarta

nya ni sugot lang pud ang seller. This is not void but voidable ni because only

1 of the parties ang nay defect so either palition ng iya parent ang balay or

ipa rescind ang contract, I uli ang balay og kwaras. Unsay effect sa void na

contract? The general rule is that it does not produce any legal effect. A void

contract is valid and enforceable until annulled by a competent court. Void is

void, di na nimo ma ratify, enforce, is good as if u didn’t have any agreement

at all.

 If kanang nay nangutang nimo nya pinasulti lang pero wa na nakabayad, ma sue

ni ng court? Yes if maka prove ka sa imo claim nangtang siya through sa imong

pag lista sa iyang payment (siguro kanang anam anam na pagbayad?) or

testimony from other prople na nagutang sya and nagbayad sya nimo- you can

take these as cooperative evidence pero kailangan ma prove ang claim na

nangutang jud siya. Under the contract of loan di na necessary isuwat but

practically, isuwat jud esp if mag impose ka og interest kay if ang interest dili ma

suwat, di sya enforceable ang principal amount lang ang ma bayran.

 In everythuing that u do, there should be a corresponding obligation if u are to

do, to give, and make something and then a contract follows. If naa moy

kontrata, u have to follow its provisions or u will be liable for damages.

kay dili violation sa law, public interest, customs, moral anyone can therefore

draft a contract without needing a lawyer but for protection since contract is

encompassing and I specify ang liabilities, opt to hire a lawyer to protect the

rights.

 Usually mga contract di na mag need og witness unless the law provides. Ex if

mag make ka og will and testament – esp notarial wills, law provides na dapat

nay 3 witnesses and dapat naa sa legal aged and kasabot sa gibuhat sa testator.

For the sake of the parties bisan wala gi require sa law na naa dapat witness, pa

witness nalang sila and this witness will be used later on if nay kiha kiha. Witness

is just used for convenience unless the law requires

 Civil code crafted the obligation and contract is for everyone. If the government

makes contract with private individuals. There are certain standards that need to

be followed in order for the contract to be valid. Ordinary citizens can make a

contract as long as it is not against the law and the such. When govt officials

make contract within their official functions, they should follow the obligations

and contract based on their charter and powers conferred to them by the

constitution or law.

 In contract of agency, mag notarize ang mga atty, they only need the signature of

the principal. It depends on u if gusto nimo mag witness. In this contract, the

principal demands the agents to do acts on her behalf. Pwede rag walay witness

sa special power of the atty.

 If ni pirma ka sa contract due to threat, if di nimo I question siya, ma accept

nalang or ratify ang contract kay gipasagdan lang man nimo.

 U cant enter a contract if ure an insane person because for a contract to be valid,

there must be consent and a valid consent requires free will, understand,
 competent, nay capacity sa mind, og dili minor. Dapat naa ka sa sakto na

pangutok, ang minor dapat nay assistance kay wala pa silay proper reasoning

faculty para maka decide on their own.

 U have to determine the faculty or reasoning of a person. What if ang senior

citizen is bryt pa, valid pa ang contract pero if gi pa dali dali syag papirma og

wala gi explain sa senior citizen ang contract, nya ni pirma si SC, pwede ma

rescind or invalidate ang contract but u have to prove to the court that the

consent was not proper and viciated. But if ma prove ng other party na walay

incompetence sa SC, dapat ma disprove ni—ex impossible maka sabot ang sc.

 State of drunkness and hypnotic spell- di maka invalidate sa contract unless ma

prove nimo na while signing the contract, you were on beyond ur drinking

capacity. I prove nimo sa court na you did not understand what u were signing. In

CC, state of drunkedness and lucid interval are not grounds to invalidate the

contract pero if di ka kasAbot og wa ka naka remember, pwede the court can

nullify the contract.

 When signing a contract, look first kung unsa ato obligation, liabilities, then

terms.