CHAPTER 3

DIFFERENT KINDS OF OBLIGATIONS

STUDY GUIDE 4

SECTION 1 PURE AND CONDITIONAL OBLIGATIONS

I. Definitions

Define or give the meaning of the following:

1. Condition
Condition is a future and uncertain event, upon the happening of which, the effectivity or
extinguishment of an obligation (or right) subject to it depends.

2. Civil loss
Civil loss is when a thing disappears in such a way that its existence is unknown; or even
if known, it cannot be recovered, whether as a matter of fact or of law.

3. Reciprocal obligations
Reciprocal obligations ate those which arise from the same cause and in which each part
is a debtor and creditor of the other, such that the performance of one is designed to be
the equivalent and the condition for the performance of the other.

4. Pure obligation
Pure obligation is one which is not subject to any condition and no specific date is
mentioned for its fulfillment and is, therefore, immediately demandable.

5. Potestative condition
Potestative condition is a condition suspensive in nature and which depends upon the sole
will of one of the contracting parties.

II. Discussions

1. Illustrate an obligation subject to:

a) Suspensive condition

When a duty is subject to a suspensive condition, Article 1179 states that the satisfaction of the
condition will determine whether the obligation is carried out.

b) Resolutory condition

A resolutory condition is one that, if met, will terminate an existing duty (or right), according to
Article 1179. This is immediately necessary.
What is the effect of the fulfillment of the condition in a conditional obligation?

The outcome of the condition being met in a conditional duty depends on whether the situation
is suspensive or conclusive. In a suspensive situation, there is an understanding between the
parties that the performance requirement is postponed until a determined or determinable data
because of the pending occurrence, which is possible to occur. The precise day, however, is
unknown. Only after the requirement has been met will the obligation increase. Both parties
agree that the responsibilities will end at a specific future period while they are in resolutory
condition. Although the precise hour is guaranteed, the precise date is still a mystery.

1. Give two (2) cases when the conditional obligation is valid although the condition
depends entirely upon the will of the debtor. Explain.
First situation, when the debtor is able to fulfill the obligation. For instance, B borrowed $10,000
from A and must pay it back to C by March 30. B is willing to pay A's loan, despite the fact that B
is not yet in a stable financial position. The A cures will manifest.

Second Case, a commits to paying B a debt of Php 20,000 in installments. This responsibility is
legitimate and will be seen as having a duration. The debtor now commits to make payments as
soon as his financial situation allows it. So, rather than determining whether the debtor should
comply or not, what depends on the debtor's will is how long he has to pay his debt.

2. May the obligor be liable under an obligation subject to a suspensive condition

although the condition has not yet been fulfilled? Explain.

Even though the suspensive condition has not yet been satisfied, the debtor will not be liable for
the obligation since, in accordance with Article 1182, the conditional obligation is void when the
debtor's single will determines whether the requirement is fulfilled. As a result, the creditor
cannot demand the obligation. Only after the requirement has been met will the obligation
increase.

3. May an obligor be liable under an obligation subject to a suspensive condition, who is

entitled to the fruits that accrued during the pendency of the condition once said
condition is fulfilled?

Yes. If the condition is suspensive and the debtor willingly stops it from happening, he may be
held accountable. The debtor is accountable since he stopped the condition from happening in
order to get out of his obligations.

4. In an obligation to give a parcel of land subject to a suspensive condition, who is

entitled to the fruits that accrued during the pendency of the condition once said
condition is fulfilled?

Unless their terms and conditions expressly specify otherwise, the debtor is entitled to the
products of the land.

5. State the rules in case the thing to be delivered:

A. Is lost with the debtor’s fault; without his fault;

Without his fault or due to his fault, the creditor may make a demand.
damage totaled with any incidental damages. If without fault of debtor, duty is
ceased to exist, and the debtor is no longer liable to the creditor.
B. Deteriorates with the debtor’s fault; without his fault.

Without his fault or due to his fault, the creditor may select from
revocation of the contract with damages OR performance of the contract with damages. Without
the debtor's fault, the credit will decline.

III.Problems
1.D (debtor) borrowed P20, 000 from C (creditor) payable on or before August 30. Before
the arrival of the due date, C agreed to the promise of B to pay C if B wants. Can C insist
that B pay not later than August 30.

No. The fact that the condition is "if B wants" means that C cannot require that B pay earlier.
The contract is void.

2.Supposed in the same problem, D obliges himself to pay C P10,000 after C has Paid his
obligation to T. Is the obligation valid?

Due to the suspensive condition being solely dependent on D's volition, the duty is legal.

3.S (seller) agreed to sell B (buyer) a specific car for P200, 000, delivery of the car and the
payment of the price to be made on June 15. Supposed S delivered the car on June 15
but B failed to pay the price, what are the remedies of S?

S may either request action for the specific fulfillment (performance) of the demand action for
the cancellation of the obligation with damages, OR damages.

4.S sold a parcel of land to B for P240,000 payable in installments of P20,000 a year. The
land was delivered to B who obtained ownership thereof. After B had paid P200,000 he
could no longer continuing paying in view of financial reverses but he was willing to pay
the balance of P40,000 if given more time. Thereupon, S sued for rescission under Article
1191. If you were judge, would you grant rescission?

No. B is willing to pay the remaining payment, thus I won't allow rescission because she's the
onlyrequires more time. I'll give B a performance-based phrase in its place.

5.D (debtor) binds himself to C (creditor) a sum of money. Give the three cases when the
obligation of D is demandable at once by C?

● If D's responsibility is not contingent on an unpredictable or future event.

● If D's responsibility is not contingent on a previously unreported incident to the parties
● If the obligation is dependent on a conclusive circumstance
 SECTION 2 Obligation with a Period

I. Definitions

Define or give the meaning of the following:

1. Obligation with a period

Obligation with a period is one whose effects ore consequences are subjected in one way
or another to the expiration or arrival of said period or term. (Article 1193)

2. Period
A period is a future and certain event upon the arrival of which the obligation (or right)
subject to it either arises or is terminated. It is a day which must necessarily come,
although it may not be known when, like the death of a person. (Article 1193).

3. Indefinite period
Indefinite period is a period when it is not fixed or it is not known when it will come.
Where the period is not fixed but a period is intended, the courts are usually empowered
by law to fix the same. (Article 1193).

II. Discussions

1. Has the debtor the right to recover what he has paid to the creditor before
the arrival of the period agreed upon?

The debtor has the right to get back any money he paid the creditor before the end of the
pre-agreed period, but only under the conditions outlined in Article 1195, which state that only if
the debtor is unaware of the period or mistakenly believes that the debt is due and demandable,
can get back the money he paid, along with the fruits and interest.

Because the creditor cannot unjustly enrich him by keeping the money before the arrival of the
period, if the obligor, for example, paid an excess amount by mistake, he has the right to
recover that amount from the creditor. However, after paying the excess amount after the period
has passed, the debtor will no longer be able to retrieve it because he has no further legal
standing.

2. If an obligation does not state a period for its performance, has the party
the right to ask a court to fix a period for the duration thereof?

When there is no specified time for the fulfillment of the obligation, the party has the right to
request that the court set a deadline. where there is no specified duration, but it is clear from the
nature of the agreement and its circumstances that a period was intended by the parties
when the debtor's sole discretion determines how long the period will last.

3. Give the cases when the obligee can demand the performance of an obligation even
before the arrival of the period agreed upon.
If the situation is in accordance with Article 1198, the oblige may demand performance of the
obligation even before the start of the specified period; however, if the debtor loses all rights to
use the period, the period is ignored and the obligation becomes pure at that point, at which
point it is immediately demandable.

PROBLEMS
Explain or state briefly the rule or reason for your answer.

1. D (debtor) borrowed P10,000 from C (creditor) at 15% interest per annum payable on
December 31. Can D require C to accept payment before December 31?

No. In this instance, D cannot demand C to accept payment and deprive C of the interest for the
remaining time since, as stated in Article 1196, the period is specified for the benefit of both the
debtor and the creditor. However, if D secures C's approval to accept the payment before the
deadline, C can receive the P 10,000 in addition to a year's worth of interest.

2. D binds himself to give P10,000 to C upon the death of the father of D. Is the obligation
of D conditional or one with a period?

In accordance with Article 1193, a day certain is one that must occur, even though the exact
date may be known. In that instance, although the exact day when D's father will pass away is
unclear, it is guaranteed to happen. As a result, this one is seen as having a deadline. It differs
from a conditional one in that it refers to an uncertain occurrence that may or may not take
place.

3. D obtained a loan from C in the amount of P50,000, payable on August 10. As security
for his debt, D mortgaged his car in favor of C. The car, however, was substantially
damaged without the fault of D. What rights, if any, does C have under the law? May C
demand payment from D even before August 10?

Despite the fact that D was not responsible for the significant damage to the car, C is
nonetheless entitled to seek payment from D even before August 10 if D does not immediately
replace the car with one of a similar value or with new security that is equally acceptable. (Art.
1198).

STUDY GUIDE
 SECTION 3 Alternative Obligations

I. Definitions
1. Alternative Obligation

Alternative obligation is one wherein various prestation are due but the performance of
one of them is sufficient as determined by the choice which, as a general rule, belongs to
the debtor.
2. Facultative Obligation

Facultative obligation is one where only one prestation has been agreed upon but the
obligor may render another in substitution.
3. Conjunctive Obligation

Conjunctive obligation is on where there are several prestation and all of them are due.

II. Discussions

1. What are the limitations on the right of choice of the debtor in alternative obligations?
Illustrate one such limitation.

The debtor must completely perform prestation chosen. He cannot compel the creditor to
receive part of one and part of another undertaking.

He cannot choose the prestations which are impossible, unlawful or could not have been the
object of the obligation.

2. Give the situation when the debtor is given the option either to exercise his right of
choice or to rescind the contract with damages

According to Article 1203, if through the creditor’s fault, the debtor cannot make
a choice according to the terms of the obligation. The debtor can exercise his right or to
rescind the contract with damages

Samantha borrowed from Nikka P 20,000. It was agreed that instead of P 20,000, Debtor could
deliver laptop, smartphone, or tablet.

Samantha has the option to break up the contact if Nikka's negligence results in the laptop
being destroyed. Samanta must reimburse the P 20,000 plus interest in the event of a
cancellation. Samantha must get payment from Nikka equal to the value of item 1 plus
damages.

Samantha has the option of choosing a smartphone or tablet instead of canceling the contract
and is still entitled to damages equal to the value of the laptop. If Samantha decides to use a
laptop, his duty is done. Nikka is not responsible for any damages.

3. State the legal effects in case:

a) some of the objects of the obligation are lost through the fault of the debtor who has
the
right of choice;

According to Article 1204, if part of the items have been misplaced or made unattainable due to
the debtor's negligence, he is not accountable because he has the right of choice and the
obligation can still be fulfilled.

b) all are lost through his fault.

According to Article 1204, the creditor is entitled to compensation for losses because the
obligation can no longer be fulfilled if all the objects have been lost or made impossible due to
the debtor's fault.
II. Problems

1. D (debtor) borrowed P10,000 from C (creditor). It was agreed that D could pay P10,000
or
deliver his piano on August 22. On August 20, D informed C that the former would deliver
his piano. Can D still change his period considering that he was given the right of
choice?

Yes, in accordance with Article 1201, the decision shall not take effect until it has been notified.
D is free to choose among the options as long as he gives C his consent.

2. Under a contract, X (obligor) promised to deliver to Y (obligee) item one, or item two, or
item three. Y was given the right of choice. What is the liability of X in case, through his
fault?

a) item two is lost or destroyed

Article 1205 states that if something is lost or destroyed due to X's negligence, Y can choose
among other items along with damages or pay the price of the other item along with damages.

b) all the items are lost or destroyed?

According to Article 1205, the creditor, who is Y, has the right to seek payment of the price of
any one of the products as well as indemnity for the losses if all the things are lost or destroyed
due to X's carelessness.

b) all the items are lost or destroyed?

If all the things are lost or destroyed through X’s fault, in Article 1205, the
creditor which is Y has the right to demand the payment of the price of any one of the
items together with the right to indemnity for the damages.

3. S (seller) sold his TV set to B (buyer) who gave S the option to deliver instead his
refrigerator. Is S liable to B in case the TV is lost through S’s fault?

Yes, because Article 1206 specifies that the debtor is liable if the main item in this case, the TV
is lost due to his fault.
STUDY GUIDE

Section 4 Joint and Solidary Obligation

I. Definitions

Define or give the meaning of the following:

1. joint obligation;

Joint obligation or one of where the whole obligation is to be paid or fulfilled

proportionately by the different debtors and/or is to be demanded proportionately
by the different creditors

2. solidary obligation

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

3. active solidarity

Active solidarity is the solidarity on the part of the creditors, where any one of them
can demand the fulfillment of the entire obligation.

4. joint indivisible obligation

The obligation is joint because the parties are merely proportionately liable. It is
indivisible because the object or subject matter is not physically divisible into
different parts.

5. solidary divisible obligation.

Solidarity may exist although the creditors and the debtors may not be bound in the
same manner and by the periods and conditions. Or prestation is
divisible but liability is solidary

II. Discussions

1. If there are two (2) or more debtors in one and the same obligation, is their
liability joint or solidary? Explain

There is just one solidary liability, per Article 1207, and it arises when the requirement
Unless otherwise specified, or as required by law or the nature of the task
solidarity. However, they have certain similarities and differences with one another. With joint
All debtors will fulfill their obligations in a proportionate manner. During solidar
only one debtor is required to fulfill the entire obligation, so that
Debtor may seek reimbursement from other debtors for his payment.

2. In case of active solidarity, to whom shall the debtor or debtors make payment?

According to Article 1214, the debtor has the option of choosing which creditor he will pay first,
but if one of them makes a demand judicial or extrajudicial the payment must go to him first.

3. Give the effect of the condonation or remission of a debt by one of several

creditors where:
(a) the obligation is joint;

When an obligation is joint, the condonation only affects the part of the specific debtor,
according to Article 1215. The co-debtors will still be obligated to pay their proportionate
amount, and the debtor's obligation will not be discharged.

(b) the obligation is solidary;

According to Article 1215, the creditor who grants the pardon and remission is the one who is
responsible to the other creditors for their respective parts.

4. In case a remission is made by a creditor of the share one of the solidary debtors,
is the said debtor released from responsibility to his co-debtor/s? Explain

The debtor is not released from his obligation to his co-debtors, as stated in Article 1219. He
still has a responsibility to pay the portion for the insolvent debtor if any of the co-debtors
become insolvent.

5. Suppose a solidary debtor obtained remission of the whole obligation, is he

entitled to reimbursement from his co-debtor/s? Explain
based on the article. The debtor is not entitled to compensation from its co-debtors
under

Section 1220. Since he made no payment and the entire obligation was forgiven, he is not
entitled to reimbursement.

III. Problems

Explain or state briefly the rule or reason for your answer.

1. X, Y, and Z bind themselves to pay W P30,000. Only X received the money as per
agreement between X, Y, and Z. On the due date of the obligation, has W the right
to demand the full payment of P30,000 from Z alone?

No, according to Article 1207, a duty is a shared duty if it does not specify solidarity. If it is a joint
responsibility, Z is only responsible for his proportionate share of P10,000; as a result, W cannot
require Z to pay the full P30,000 due.

2. X, Y, and Z promised to pay solidarily P30,000 on or before September 10 without

need of demand. On September 9, X paid the whole P30,000 to W.

(a) How much can X collect from Y and Z?

Article 1217 states that X may only collect from Y and Z the share that corresponds to them,
which is P10,000 per person.

(b) May X collect interest from Y and Z?

No, because payment was made before the obligation was due, X is not permitted to collect
interest from Y and Z in accordance with Article 1217.

(c) Suppose Z turns out to be insolvent, how much can X collect from Y?

Article 1217 states that if Z falls bankrupt. With the addition of P15,000 from Z's half of the
share, X can get payment from Y for his portion.
3. A owes B and C solidary creditors, the sum of P20,000:

(a) Can C condone the debt without the consent of B?

According to Article 1212, C may forgive the debt without B's consent. Nevertheless, he is still
responsible to B and must pay back B's portion of the loan.

(b) Can C assign his rights without the consent of B?

No, in accordance with Article 1213, C is not permitted to transfer his rights without B's
permission. If there are three creditors (B, C, and D), however, C may assign his rights to D
even without B's permission.

4. A, B, and C are solidarily liable to D. For their failure to pay, D filed a complaint in
court but only against C. Has C the right to demand that A and B also included as
party of defendants?

No, contrary to what is stated in Article 1216, C is not entitled to request that the defendants
also include A and B. C can be made to pay the entire debt because he is a solidary debtor.
However, D may still pursue the other solidary debtors if C is unable to pay the full sum.

5. A, B, and C, co-owners, sold a printing equipment to D. They solidarily bound

themselves to deliver the equipment on a certain date. Through the fault of C, the
equipment was completely destroyed. Give the rights and obligations of the
parties.

Since solidary obligation is referred to as a mutual agency, as far as D is concerned, Article

1221, paragraph 2 holds A, B, and C jointly and severally liable for the cost of the printing
equipment as well as the damages even though A, and B are not at all at fault. If A and B have
already paid for the printing press, they may be able to claim damages from C. In the event
that C already paid for the cost and damages, C cannot demand compensation from A and B.

SECTION 5 Divisible and Indivisible Obligations

I. Definitions

Define or give the meaning of the following:

1. Divisible obligation;
Divisible obligation is one the object of which, in its delivery or performance, is capable
of partial fulfillment.

2. Indivisible obligation;
Indivisible obligation is one the object of which in its delivery or performance, is not
capable of partial fulfillment.

3. Legal indivisibility.
Legal indivisibility is where a specific provision of law declares as indivisible,
obligations which, by their nature, are divisible.
II.Discussions

1.Explain: The divisibility of an obligation is different from the divisibility of the

thing which is the object thereof.

An obligation's divisibility or indivisibility is not determined by the divisibility or indivisibility of its

object, according to Article 1223. Since the law or the parties intended the obligation to be
indivisible, even though the object may be physically diviable, it will be regarded as indivisible. If
the items are physically impossible to divide, the responsibility will be indivisible in accordance
with the unchanging law.

2.What obligations are deemed indivisible?

According to Article 1225, there are four situations in which the obligation is deemed to be
indivisible. These situations include obligations to provide specific goods or services, obligations
that are not subject to partial performance, obligations that are required by law to be indivisible
even if the good or service is physically divisible, and obligations that the parties intended to be
indivisible in those situations.

3.What obligations are deemed divisible?

There are three circumstances in which an obligation is judged to be divisible, as indicated in

Article 1225 as well. These include duties that call for the completion of a specific number of
days' worth of work, obligations that call for the completion of work in metric units, and
obligations that can be partially completed.

III.Problems

Explain or state briefly the rule or reason for your answer:

1.A and B bind themselves to pay C their loan of Php10,000 on a certain date. Is the
obligation divisible or indivisible?

The obligation in this case is categorized as indivisible because, despite the fact that the item is
divisible, the debtors intended the object to be indivisible since they will pay the money on a
specific date, prohibiting partial or installment payment of the obligation.

2.A, B, and C oblige themselves jointly to deliver to D a particulars horse on a certain

date. The agreement among A, B, and C which was made known to D is that they will
contribute the amount in buying the horse. The horse was not delivered on the due date
because of the failure of B to give his share of the purchase price. State the rights and
obligations of the parties

According to Article 1224, the obligation in this case to deliver a horse is regarded as indivisible
because it is a shared obligation. The failure of one of the debtors in this situation to complete
their commitment will result in the payment of damages. While debtors A and C are not
responsible for B's portion and will pay for their own. As D is the creditor, B is likewise obligated
to pay D damages as determined by D.

3.D finds himself to pay his loans of Php10,000 in four equal monthly installments.
Is the obligation of D divisible or indivisible?
According to Article 1225, this responsibility is divisible and falls under a category of
responsibilities that by their very nature are amenable to partial accomplishment. Due to the
fact that P10,000 would be paid in instalments, D will make four payments totaling P2,500.

SECTION 6 OBLIGATIONS WITH A PENAL CLAUSE

I. Definitions

Define or give the meaning of the following:

1. Obligation with a penal clause;

Obligation with a penal clause is one which contains an accessory undertaking to pay a
previously stipulated indemnity in case of breach of the principal prestation, intended
primarily to induce its fulfillment.

2. Penal clause;
Penal clause is an accessory undertaking attached to an obligation to assume greater
liability in case of breach.

3. Joint penal clause.

Joint penal clause or can also be called as cumulative penal clause is when both the
principal obligation and the penal clause can be enforced.

II. Discussions

1. What are the purposes of incorporating a penal clause to an obligation?

In accordance with Article 1226, penal clauses are added to contracts in order to ensure their
performance and to make the consequences of a breach as severe as feasible, and to replace
the penalty for indemnification for damages and the payment of interest in the event of
non-compliance. Reparation and punishment are the major objectives.

2. In an obligation with a penal clause, may the creditor still recover damages and
interests in addition to the stipulated penalty?

According to Article 1226, the creditor may still exercise this right if it is agreed upon by the
parties, the debtor refuses to pay the fine in which case the creditor may recover legal interest
thereon, or the debtor commits fraud in carrying out the obligation iin which case the creditor
may recover damages resulting from such fraud.

3. In what cases may the debtor validly object to the enforcement of the stipulated
Penalty?

According to Article 1227, a debtor may object to the imposition of a penalty if he has performed
on his part or if the creditor has already demanded that the duty be fulfilled.

III. PROBLEMS

1. X promises to deliver to Y a specific horse. Their contract contains a penal clause that
in case of non-fulfillment, X shall a penalty of P 10,000. X wants to just pay that penalty
instead of delivering the horse. Has Y the right to refuse to accept the penalty in lieu of
the horse?

Yes. According to Article 1227, the debtor cannot excuse himself from fulfilling his obligations by
just paying the fine. Because the penalty is only an accessory requirement, X is not permitted to
fulfill it without also fulfilling the principal obligation (to deliver the horse).

2. In the same problem, X was able to show that Y did not suffer any damage by X’s
violation of his obligation. Can Y still enforce the penalty?

Yes. According to Article 1228, the penalty may be imposed without showing that the creditor
actually suffered damages. The debtor's breach of commitments must be proven by all
creditors. Therefore, even though X did not experience any harm, Y has the authority to impose
a penalty because X violated his contract.

3. In the same problem, suppose X was guilty of negligence in the fulfillment of his
obligation. Is X liable for damages in addition to the penalty?
No. If the debtor commits deceit in carrying out the obligation, he may be held accountable for
damages (Article 1226). X was simply negligent in this situation, not fraudulent. As a result, he
is not also responsible for compensatory damages.