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JOINT AND SOLIDARY OBLIGATIONS

Kinds of Obligation According to Number of Parties

1. Individual Obligation – where there is only one obligor or one obligee.

2. Collective Obligation – where there are two or more debtors and/or two or more
creditors. It may be joint or solidary.

Joint and Solidary Obligations

A joint obligation is where each obligor/debtor answers for a part of the whole liability
and to each obligee/creditor belongs only a part of the correlative rights.

Example:

a. A and B are joint debtors of C for Php1,000. C can collect Php500 from A and
Php500 from B.

b. A is the debtor of B and C, joint creditors, for Php1,000. B can collect PHp500
from A and C can collect Php500 from A.

A solidary obligation is where each one of the debtor is bound to render, and/or each
one of the creditors has a right to demand from any of the debtors, the entire
compliance with the prestation.

Example:

a. A and B are solidary debtors of C for Php1,000. C can collect from either A or B
the entire Php1,000.

b. B and C are solidary creditors of A. A can either pay B or C Php1,000.

How can one presume a collective obligation to be joint?

One can presume joint obligation where there is a plurality of the parties (two or more
debtors and/or two or more creditors) and the share of each is specified.

Example: If X, Y and Z are liable to A in the amount of Ph6,000. It was stated that each
debtor has a corresponding share to pay, which could be in equal or unequal amounts.
A is not entitled to collect more than a debtor’s share.
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What if the contract was not clear about the share of each debtor?

Still, the presumption is that the obligation (liability) is joint.

What if X becomes insolvent and cannot pay his share, can A compel Y or Z to pay X’s
share?

No, because the debts are joint in nature making the debts distinct and separate from
the other. The insolvency of the debtors shall not make others liable.

What are the common words used to indicate joint liability?

E Mancommunada

E Mancomunadamente

E Pro rata

E Proportionately

Can one presume a solidary obligation?

No. There is solidary obligation only when:

E The obligation expressly so states.

E The law requires solidarity.

E The nature of the obligation requires solidarity.

Solidary obligations are very burdensome for they create unusual right and liabilities.
The law tends to favor the debtors in presuming that parties are bound jointly and not
solidary.

The common words to indicate solidary liability are: jointly and/or severally; solidaria;
together and/or separately; individually and/or collectively.

Examples:

a. A and B are solidary debtors of C, D, E and F, solidary creditors to the amount

of Php1000. How much can C demand from A? What is the remedy of A?

 C can demand Php1000 from A. A in turn can demand reimbursement from B for
Php500.

b. A and B are solidary debtors of C, D, E and F who are solidary creditors in the
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amount of Php1000. How much can C demand from A?

 Any creditor can demand from any debtor the whole Php1000. In turn, the creditor
like C has to give Php250 each to the three other creditors. B has to reimburse A
for Php500 which is really B’s share of the obligation.

Joint Indivisible Obligation

It is an obligation where the parties are merely proportionately liable. It is indivisible

because the object or subject is not physically divisible into different parts.

Example:

A and B are jointly liable to give C this particular car.

 The obligation is joint and the object is indivisible. Thus, the creditor must
proceed against ALL the joint debtors for compliance is possible only if all the
joint debtors would act together.

 Demand must be made on ALL debtors.

 If one debtor does not comply – monetary obligation for damages.

Example: A and B are jointly liable to deliver to C a car. The car is worth Php100,000. If
A does not want to deliver the car to C, the obligation becomes a monetary obligation.
Thus, A and B are liable to C for Php50,000 each. C cannot demand the entire
Php100,000 to C since it is a joint obligation.

 If there are joint creditors – delivery must be made to all unless one is specifically
authorized.

What is the difference between indivisibility and solidarity?

1. Indivisibility refers to the subject matter or prestation. Solidarity refers to the tie
between the parties.

2. Indivisibility can exist although there is only one debtor and creditor, while in
solidarity, there must be at least two debtors or creditors.

3. In indivisible obligations, only the debtor guilty of breach of obligation is liable for
damages. In solidary obligations, all the debtors are liable for the breach of the
obligation.

4. In indivisible obligations, the others are not liable in case of insolvency of one
debtor. In solidary obligations, the other debtors are proportionately liable.
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What are the two ways by which debtors may be bound?

a. Uniform – where the parties are bound by the same stipulations.

b. Non-uniform or varied – where the parties are not subject to the same
stipulations.

The rule is: the whole solidary obligation can be recovered from ANY of the solidary
debtors MINUS the share of those with unmatured conditions or terms.

Example:

In 2000, A, B and C bound themselves in solidum to give X Php3000 subject to the

following conditions:

A to pay in 2007; B, if he passes the board exams; and C in 2009.

In 2007, how much can X demand from A?

Only Php1000. X has the right to the whole amount Php3000 minus B’s and C’s shares.
He cannot collect the shares of B and C from A yet if B has not passed the board exams
yet and 2009 has not yet arrived. In 2009, X can collect from A the Php1000
corresponding to C’s share. The moment B passes the board exams; X can collect from
A also.

Can X collect from C in 2007? How much?

Php1000 only. This Php1,000 pertains to the share of A. Since it is a solidary obligation,
X can collect from anyone. But the shares of B and C cannot be collected in 2007 yet if
the condition/period has not yet happened or arrived.

Can a solidary creditor assign his right to another person?

No, the assignment of his right must be consented to by his co-creditors. But if the
assignment was made to a co-creditor, the consent of other creditors is not necessary.

When is payment to any of the solidary creditors done?

When a demand, judicial or extra-judicial, has been made by any of the other creditor,
the payment should be made to him.

Example:

A is liable to pay B and C, solidary creditors, Php2,000. A may pay either B or C but if a
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demand, judicial or extrajudicial, is made by B, payment should be made to B. If A,

nevertheless, paid C, Php2,000, B is still entitled to his share from A in case C does not
turn over to B the latter’s share. If B and C demanded payment at the same time, A may
pay either of them.

If there are two or more debtors, only the debtor, upon whom the demand had been
made, is bound to make payment to the creditor who made the demand.

Articles 1215-1222

Article 1215

Novation, compensation, confusion and remission are modes of extinguishing

obligations. A solidary creditor who has executed any of the modes shall be liable to his
co-creditors for their corresponding shares.

Example:

A, the debtor, owes B, C and D (solidary creditors) an amount of P15,000. Independent

of the said debt, B has a debt to A worth Php15,000, so B told A that there is no need
for him (A) to pay Php15,000. This act is called compensation. However, B would still be
liable for the respective shares of C and D for the debt owed by A.

What if the liability is joint in nature?

In a joint obligation, any modes of extinguishments, does not affect the liability except
with respect to the creditor applying the mode of extinguishments.

Example:

Using the example above, but now B, C and D are joint creditors. B can only apply the
compensation to his share, which is Php5,000 and, not the whole amount of Php15,000.
Thus, A will still pay Php10,000 to B, which B should in turn give to C and D (Php5,000
each).

Article 1216

Can a creditor proceed against any one of the solidary debtors?

A creditor has the right to proceed against any or some solidary debtors or
simultaneously as long as the debt has not been fully collected.

Example:

A and B solidarily owe X Php2,000. X can collect the Php2000 from A or B alone. If B
only paid X Php500, X may go to A for the remainder of the debt.
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Article 1217

When a solidary debtor paid in full what is due, what is the status of the obligation?

The obligation is extinguished.

After the payment of the whole sum, can the debtor demand reimbursement?

Yes, the paying solidary debtor can demand reimbursement from his co-debtors for their
proportionate shares with legal interest from the time of payment.

In the case of the solidary creditor who has been paid the amount, he will be jointly
liable to his co-creditors for their corresponding shares.

If one of the co-debtors declares insolvency, will he be compelled to pay?

No, other co-debtors will have to assume the share of the insolvent pro rata.

Example:

A, B and C are jointly and severally liable to D and E in the amount of Php3,000 due on
January 5.

 If both A and B offer to pay D, on January 5, the latter may choose which offer to
accept. If A pays the entire amount of Php3,000 on January 5, the obligation is
extinguished.

 The payment by A gives him the right to demand reimbursement from B and C
Php1,000 each with interest from the date of payment. But A is not entitled to
reimbursement nor did to interest for any payment make before January 5. The
obligation of B and C with interest will arise only from January 5.

 If C is insolvent, both A and B shall bear his insolvency in proportion to their

shares. Hence, A can still ask B to pay an additional sum of Php5,000 on top of
his (B’s) Php1,000 share. Of course, A and B can later on recover from C should
the latter’s finances improve.

 D, on the other hand, has the obligation to give to E his corresponding share in
credit.

Article 1218

In what case/s, can the debtor NOT demand reimbursement from his co- debtor?
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When the obligation has already prescribed or become illegal and the obligation is
extinguished, the debtor cannot demand reimbursement because there are no more
obligations to be complied with.

Example:

A and B solidarily owed Y Php5000. The debt will prescribe by Friday. B paid Y on
Saturday the whole amount. He cannot demand A his share of the debt because the
debt has prescribed.

What is the concept of prescription?

By prescription, one acquires ownership and other right through the lapse of time. In the
same way, right and actions are lost by prescription.

Article 1219 and 1220

What is remission?

Remission is the gratuitous abandonment by the creditor of his right against the debtor.
It is a form of donation.

Does remission made by the creditor of the share affects and release the solidary
debtor?

No. If payment was made first then there is no remission. If remission was given and
payment is made, there is mistake in payment (solution indebiti) forestalled.

Example:

A and B are liable in solidum to Y for the amount of Php5,000. Y remitted A’s share.
Afterwards, B made payment of Php5,000. Can B ask for reimbursement from A? No,
because A’s share, Php2500, has been previously remitted and therefore the obligation
is extinguished. What B can do is to demand from Y the return of A’s share which he
paid.

If payment by B was made before the remission, A will be liable because the remission
is of no effect.

Can one of the solidary debtors who have obtained a whole remission of the obligation
ask for reimbursement from his co-debtors? (Article 1220)

No because the debtor who obtains remission pays nothing to the creditor.
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Does this apply to cases of novation, compensation or confusion?

No. The debtor is entitled to reimbursement from his co-debtors.

Article 1221

What is the rule in case of loss or the prestation has become impossible without the
fault and before delay of the solidary debtors?

The obligation shall be extinguished.

Example:

A, B and C promised solidarily to deliver to D a particular truck valued at Php15,000.

The obligation shall be extinguished if the truck is lost or destroyed through a fortuitous
event without the fault of A, B and C and before they have incurred in delay.

If the loss is due to the fault on the part of the solidary debtor?

All the solidary debtors will be liable for the fault and delay even if only one debtor is at
fault. The guilty debtor will have to reimburse his co- debtor’s share who may have
contributed to the price and damage forestalled.

Example:

If in the above example, the truck was lost through the fault of C, A and B shall also be
responsible to D for the price of the truck as well as damages although A and B were
not at fault at all. A and B, however, can recover from C, the guilty debtor, the full
amount of such price and damages if A and B have already contributed to the price of
the truck. If D claims damages from C, C cannot claim reimbursement from A and B,
because he alone was at fault.

If the loss is without fault but after delay?

The solidary debtors will be held responsible even if only one debtor is at fault (who may
not have communicated the demand of the creditor) even if the default was due to a
fortuitous event. The creditor can recover damages to any of the debtors.

Example:

If the truck was lost through a fortuitous event but after a demand was made upon C, D
can still recover damages from A and B or both of them without the prejudice to the right
of action of the latter against C following the same rights above. The default by C makes
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all the solidary debtors responsible even for a fortuitous event.

Article 1222

What are defenses available to a solidary debtor?

In actions filed by the creditor, a solidary debtor may avail himself the following
defenses:

1. Defenses derived from the nature of the obligation

 A defense derived from the nature of the obligation is a complete defense

because it nullifies the obligation or renders it effective.

Example: fraud, prescription, remission, illegality, absence of consideration

A and B are solidarily liable to C in the amount of Php4,000. The entire debt of A
and B was paid by D. In an action by C against A, the latter can raise the defense
of payment by virtue of which the obligation was extinguished. This is a complete
defense because it nullifies the obligation or renders it ineffective.

2. Defenses personal to, or which pertain to share of, debtor sued

Example: incapacity, mistake, violence

If the action by C was against B, and B was insane at the time the obligation was
contracted, B can put up the defense of insanity with respect to the entire
obligation. This defense is personal to B alone but it is a complete defense with
respect to B.

However, if that portion of the obligation affecting B is subject to a suspensive condition

which has not yet happened, the non-fulfilment of the condition is a partial defense as it
can be set up by B only with respect to his share. C can demand from B the portion of
the obligation pertaining to A because B is solidarily liable.

3. Defenses personal to other solidary debtors

Example: A debtor may raise his share in the obligation.

In the above examples, the defense of insanity or non-fulfillment of the suspensive

condition is not available to A as to release him from his liability for his share in the
obligation. In other words, A may avail himself thereof only as regards that part of the
debt for which B is liable. Hence, having only a partial defense, A is still liable for
Php2,000, his share in the obligations.
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Divisible and Indivisible Obligations

What is a divisible obligation?

In a divisible obligation, the object of the obligation, in its delivery or performance,

is capable of partial fulfilment.

Example: D is obliged to bring 10 cavans of rice to E in two monthly instalments.

The obligation here is divisible because it is capable of partial performance.

What is indivisible obligation?

In an indivisible obligation, the object of the obligation, in its delivery or performance, is

not capable of partial fulfilment.

Example: D is obliged to give E a car. The obligation here is indivisible because D

cannot deliver only a half of the car.

An obligation is presumed indivisible where there is only one creditor and only one
debtor.

Does the divisibility or indivisibility of the obligation affect an obligation’s fulfilment?

Divisibility or indivisibility of the object or prestation does not alter or modify the
provisions set forth in the fulfilment of an obligation. An obligation is not deemed paid
unless the thing or service has been completely delivered or rendered.

What is the effect of non-compliance by a debtor in a joint indivisible obligation?

If any one of the debtors does not comply with his undertaking in a joint divisible
obligation, the obligation is converted into one for damages.

Can the debtors who are willing to perform their obligation be demanded to pay
indemnification?

Yes but the indemnity should not be beyond the corresponding portion of the price of
the thing or the value of the service in which the obligation consists.

Can the creditor ask for specific performance or rescission?

No. The creditor cannot do so because there is no cause of action against the other
debtors who are willing to fulfil their duties.
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What are the obligations deemed indivisible?

1. Obligations to give definite things.

2. Obligations which are not susceptible of partial performance.

3. Obligations provided by law to be indivisible even if thing or service is physically

divisible.

4. Obligations intended by the parties to be indivisible even if the things or service is

physically divisible.

What are the obligations deemed divisible?

1. Obligations which have for their object the execution of a certain number of days
of work.

2. Obligations which have for their object the accomplishment of work by metric
units.

3. Obligations which by their nature are susceptible of partial performance.

Could you classify obligations not to do as divisible or indivisible?

Yes. You could actually classify it as divisible or indivisible depending on the

character of an obligation’s prestation.

In general, obligations “to do” and “not to do” are generally indivisible. Obligations “to
do” are divisible.

Examples:

a. Indivisible obligation – Mang Pedro obliged himself not to sell beer at his grocery
for 6 months.

b. Divisible obligation – Mang Pedro obliged himself not to sell beer during
Sundays.

Obligations with a Penal Clause

A penal cause is an accessory undertaking attached to an (principal) obligation to

assume greater liability in case of breach, i.e., the obligation is not fulfilled, or is partly or
irregularly complied with.

What are the purposes of a penal clause?

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1. To ensure performance making the obligation onerous.

2. To substitute a penalty for indemnity of damages and the payment of interest.

Is a penal clause same with a condition?

1. Penal clause constitutes an obligation although accessorial in nature.

2. Penal clause may become demandable in the default of unperformed obligation.

What is the penalty substitute for damages and interests?

The penalty takes place of the indemnity for damages and the payment of
interest in case of non-compliance.

Example:

X promised to construct a house for Y. The contract carried a penal clause that in case
of non-compliance, X would have to pay a penalty of Php50,000. X did not construct the
house and, as a consequence, Y suffered damage in the amount of Php40,000. In this
case, the penalty of Php50,000 shall be paid. Y cannot recover more than Php50,000,
the penalty stipulated, even if he proves the damages suffered by him is Php60,000.
The penalty substitutes the indemnity for damages unless there is a stipulation to the
contrary, in which case, Y may also recover the damages proved by him. If X refuses to
pay the penalty, Y may recover legal interest thereon, the interest representing new
damages brought about by the non-payment of the penalty.

Does the creditor have to prove the damages he suffered?

No. The creditor, in fact, may enforce the penalty whether he suffered damages or not.
He can only recover the stipulated penalty even if the damages he suffered exceed the
penalty.

When can the creditor recover damages?

In addition to the penalty, the creditor may recover the damages and interests:

1. When so stipulated by the parties

2. When the obligor refuses to pay the penalty

When the obligor is guilty of fraud in the fulfilment of the obligation?

The creditor may also ask for legal interest from the time the debtor refuses to pay the
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penalty.

When may penalty be enforced?

Penalty is demandable when there is a breach of the obligation and it is not contrary to
the law, morals, good customs or public order.

Can the debtor exempt himself from the performance of the obligation by paying the
penalty?

No.

Can the creditor demand fulfillment of the obligation and the payment of the penalty at
the same time?

As a general rule, it is not allowed. The exceptions are:

1. When the right has been clearly granted to the creditor

2. In cases of non-performance

When can the court reduce the penalty borne by the debtor?

1. When there is partial or irregular performance

2. When the penalty agreed upon is unconscionable (shocking to the conscience)

Will the nullity of the penal clause affect the principal obligation?

No, because a penal clause is only accessory to the principal obligation. The nullity of
the principal obligation carries to that of the penal clause.