Article 1179: Section 1: Pure & Conditional Obligations

SECTION 1: PURE & CONDITIONAL
OBLIGATIONS
Article 1179
JANUARY 6, 2015 / DIONE MENDOZA
Bawat obligasyon na kung saan ang pagganap nito ay hindi nakasalalay sa isang
kaganapan sa hinaharap o hindi tiyak na pangyayari, o sa isang nakaraang kaganapan
na hindi alam ng mga partido, ay kailangan gawin kaagad.
Bawat obligasyon na naglalaman ng isang resolutory kundisyon ay dapat ding

magawa kaagad, nang walang pagkiling sa mga epekto ng mga nangyayari sa mga
kaganapan.
Article 1180
Kapag ang may utang ay ibinigkis kanyang sarili upang bayaran ang kanyang pag
kakautang kapag ang kanyang pamamaraan/kakayahan ay pinahihintulutan siya upang
gawin ito, ang obligasyon ay itinuturing bilang isa na may takdang panahon, na
napapailalim sa mga probisyon ng Article1197
Illustrative case digests by Allan Pailan
February 1, 1911
Levy Hermanos – plaintiffs-appelles
vs.
Pedro Paterno -Defendant- Appellant
FACTS:
a.) The defendant vale for the sum of P6,77.35 in favor of Msr. levy brothers as the
balance of account with them to date, payable in partial payments(March 28, 1906).
b.) The unfixed rate made payments by the defendant caused the plaintiff suit against
the defendant to pay the apelles the sum of P5,862.35, -the unpaid balance be paid on
the specific period.
c.)During the trial, it was agreed by the parties the sum which the defendant owed the
plaintiff on March 28, 1906 as P5,317.35.
d.) The trial court sentenced the defendant to pay the plaintiffs reasonable compliance
with the agreement to pay in monthly payment of P200 on or before the 15th day of
each month. this judgment appealed by the defendant.
ISSUE:
Whether or not that the trial court sought no abuse of judicial discretion in fixing such
a rate.
HELD:
No, the trial court, therefore acted in accordance with the law in exercising the said
power in the present case by fixing the duration period on the basis that the payment
of debt should be made at the rate of P200 a month, considering the importance of
obligation and the absence of any stipulation of interest in favor of the creditors.
The supreme court affirmed the judgment of trial court.
Article 1181
Sa conditional obligation, ang pagtatamo ng karapatan, pati na rin ang pagtapos o

kawalan ng mga natamo na, ay nakasalalay sa mga pangyayari ng mga kaganapan na
bumubuo ng kundisyon.
Case Digest by Ainna Fathi

Case: Emilio Natividad v. Basilia Gabino (36 PHIL. 663),
March 31, 1917
PETITIONER: Emilio Natividad
RESPONDENT: Basilia Gabino
PONENTE: Torres, J.
On August 21, 1915, an order given by the judge of the Court of First Instance
arose from interpreting the true wishes of the testator, Salvador Y Reyes that on
accord to clause 6 of the testament, ownership and dominion of subject
property should be awarded to Basilia Gabino, subject to the reservation made
in behalf od Lorenzo Salvador and Emilio Natividad. Because of this, an
amendment was ordered to clarify the confusion on Clause 6 of the testament.
The original clause 6 was:
“I bequeath to Doña Basilia Gabino the ownership and dominion of the urban
property, consisting of a house and lot situated on Calle Lavezares of the said
district of San Nicolas and designated by No. 520, and in addition eleven
meters by two meters of the lot designated by No. 419, situated on Calle
Madrid. This portion shall be taken from that part of the lot which is adjacent to
the rear of said property No. 520. If the said legatee should die, Lorenzo
Salvador shall be obliged to deliver this house, together with the lot on which it
stands, to my grandson Emilio Natividad, upon payment by the latter to the
former of the sum of four thousand pesos (P4,000), Philippine currency.”
This case was filed by Emilio Natividad, the administrator of the estateof the
decedent, Tiburcio Salvador Y. Reyes as an appeal from the order upheld by
the CFI.
FACTS
ISSUE/S Whether the CFI erred in interpreting clause 6 of the testament
LAWS Article 1181. In conditional obligations, the acquisition of rights, as well as the
extinguishment or loss of those already acquired, shall depend upon the happening of
the event which constitutes the condition. (1114)
Suspensive Condition/Condition Precedent: Also know as condition
antecedent – a condition that rules an obligation as non-existent should an event
NOT take place.
The event is considered future and uncertain. If this event does not happen, the
parties will stand as if the conditional obligation never existed;
Resolutory Condition/Condition Subsequent: A condition that extinguishes

rights and obligations already existing; The rights and obligations are already
existing but are under threat of extinction upon the happening or fulfillment of
the resolutory condition.
A “but, if” condition:
e.g #1: Piece of land given with a resolutory cause that it be used as a park, if a
park is not constructed then entitles the donor to revoke the obligation.
e.g #2: propter nuptias
e.g #3: reserva troncal
HOLDINGS No. The CFI did not err with their ruling. The condition imposed by the testator in the
double legacy mentioned depends upon the happening of the event constituting the
condition, to wit, the death of the legatee Basilia Gabino, a perfectly legal condition
according to article 1114 of the Civil code, as it is not impossible of performance and
is not contrary to law or public morals, as provided in article 1116 of said code.
The moment the legatee Gabino dies the other legatee, Lorenzo Salvador, is
obliged to deliver the property to the heir Emilio Natividad who, in his turn and
in exchange, must pay the legatee Salvador the sum of P4,000, thereby
fulfilling the double legacy contained in the said sixth clause of the will, the
first of these legacies being the voluntary reservation to Basilia Gabino of the
ownership of the said house, and the second, the conditional legacy of P4,000
to Lorenzo Salvador.
If the provisions of article 675 of the Civil Code are to be complied with, it
cannot be understood that the testator meant to bequeath to Basilia Gabino the
mere usufruct of the property, inasmuch as, by unmistakable language
employed in the said sixth clause, he bequeathed her the ownership or
dominion of the said property — language which expresses without the
slightest doubt his wishes which should be complied with literally, because it is
constant rule or jurisprudence that in matters of last wills and testaments the
testator’s will is the law.
Also, both conditions set forth by the testator are not contrary to law or public
morals.
The August 21 Ruling was affirmed, with costs against the appellant.
Article 1182
Kapag ang katuparan ng kondisyon ay nakasalalay sa kusang loob ng may utang, ang
conditional obligation ay wala ng bisa. Kung ito ay depende sa pagkakataon o sa
kagustuhan ng isang ikatlong tao, ang obligasyon ay dapat magkabisa sa pagsunod sa
mga probisyon ng Code na ito.
Article 1183
Ang mga imposibleng kondisyon, na labag sa magandang kaugalian o patakarang

pampubliko at mga ipinagbabawal ng batas ay dapat ipawalang-bisa ang obligasyon
na nakasalalay sa kanila. Kung ang obligasyon ay maaaring hatiin, ang bahagi nito na
hindi apektado ng mga imposible o labag sa batas na kondisyon ay dapat na may-bisa.
Ang kondisyon na hindi gumawa ng isang imposibleng bagay ay itinuturing na hindi

napagkasunduan.
DISCUSSION BY BONG REYES

All conditions that are impossible and not true can annuls not only the condition itself
but the whole contract. Things that cannot be done was considered not agreed upon.
Examples of impossible conditions are:
1. I will give you money as a loan if its snow in the Philippines.

2. I will give you the company if you drink water in the Pasig river until it runs dry.
Examples of impossible conditions contrary to good morals and customs.
1. I will give you parcel of land if you could kill Cathy in 24 hours.
2. I will give you parcel of land if you will leave Marian and live instead with
Antonette.
Article 1184
Ang kondisyon na may nangyaring kaganapan sa isang tukoy na oras ay dapat

pagtatapos na ng obligasyon lalo na kapag natapos na ang oras o kung ito siguradong
hindi mangyayari.
Article 1185
Ang kondisyon na ang ilang mga kaganapan ay hindi mangyayari sa isang tukoy na
oras ay dapat maging sanhi upang maging epektibo ang obligasyon mula sa sandali na
ang oras na nakasaad ay lumipas, o kung ito ay naging malinaw na ang kaganapan ay
hindi maaaring mangyari.
Kung walang oras na nakasaad, ang kundisyon ay dapat itinuturing na natupad sa

naturang oras bilang maaaring/marahil ay napagisipan, laging tatandaan ang katangian
ng obligasyon.
Article 1186
Ang kundisyon ay dapat itinuturing na naisakatuparan na kapag ang nagpautang ay

kusang-loob na pumipigil sa katuparan nito.
Illustrative case by Allan Pailan

M.D. Taylor (Plaintiff-Appelant) October 2, 1922
vs.
Uy Tieng Piao & Tan Liuan (Defendant-Appellant)
FACTS:
On December 12, 1918, the plaintiff contracted his services to Tan Liuan & Co., as
superintendent of an oil factory which the latter establishing in this city. The period of
the contract extended over two years from the date mentioned and the salary date
salary rate of P600 per month during 1st year and P700 per month during the second
year, with electric light and water for domestic consumption and a residence to live or
in lieu thereof of 60 per month at the time.
At the time this agreement was made, the machinery for the factory had not been
acquired, though ten expellers had been ordered from the U.S. as agreed, for any
reason the machinery failed to arrive in the city of Manila for the period of six months
from the date given, the contract may be canceled by the party of the second part.
The machinery stated in the contract did not arrive in the city of manila within the six
month after the making of the contract, and other equipment necessary for the factory.
June 28,1919, the defendants informed the plaintiff that they had decided to rescind
the contract effective June 30th. The plaintiff instituted the action to recover damages
in the amount of P13,000.00 covering salary and perquisite under the contract.
ISSUE:
Whether or not that the plaintiff-appellant may demand perquisites under the
rescinded contract.
HELD:
Yes, it has been concluded that the Court of First Instance committed no error in
rejecting the plaintiff claim in so far as damages are sought for the period subsequent
to the expiration of the first six months, but in the assessment of damages due for six
months period, the trial judge evidently overlooked the item of P60 specified in the
plaintiff fourth assignment of error, which represent commutation of house rental for
the month of June 1919. this amount the plaintiff is clearly entitled to recover, in
addition to the P300 awarded in the lower court.
The judgment of CFI is modified, the defendant shall pay the plaintiff the sum of
P360 instead of P300 as allowed by the lower court.
Article 1187
JANUARY 3, 2015 / JAIME ROBILLON
Ang apekto ng isang maykondisyon obligasyon magbigay, kapag kondisyon ay

naisakatuparan na ay magkakabisa mula sa araw kung saan ang obligasyon nagsimula.
Ganun paman, kung ang obligasyon nagpapataw ng palitang pagbabayad sapagitan
nila, ang mga bunga at tubo sa panahon umiiral ang kudisyon ay maituturing na
kapwa ay nagbayad na, kapag ang obligasyon ay para lang sa iisan ang
maypagkakautang ay ilalaan ang mga bunga at mga tubo natanggap, maliban mula sa
natural na kaganapan ng obigasyon iyon ay maipagpapalagay na ang pakay ng taong
maykagagawan ng ganuon ay iba.
Sa obligasyon na gumawa at ng hindi pag gawa, ang hukoman ang magpapasiya ng

bawat pangyayari, ang pagkabisang pabalik ng kundisyon ay natupad na
Dion discussion
Article 1188
Ang nagpapautang ay maari, mbago matupad ang kundisyon, ay gumawa ng nauukol

na hakbangin upang mapanatili ang kanyang karapatan.
Jacinto v De Leon 51 Phil. 992
CASE DIGEST BY BONG REYES

JACINTO VS. DE LEON, 51 PHIL.992
FACTS:
This action was made to court for damages and none fulfillment of the obligation
agreed upon by the defendant under oath. The purchaser of the property in the public
auction sold by the defendant was presumed to be a property
of Carpenter.Thedefendant Conrado de Leon as Sheriff of the province of Rizal
guaranteed the liability and interest for the present action.
He appealled from this decision of the lower court.
ISSUE:
Whether or not according to stipulation of facts, plaintiff had a right to require sheriff
to retain the proceeds of sale to judgment of Carpenter?
HELD:
The plaintiff have no right for the retention which he asked because debt was based on
the claim which is not due and payable. And that the Sheriff is not bound to retain the
proceeds requested nor it was not his duty to grant any claim. Defendant absolved in
the complaint.
Article 1189
Kung ang kasunduan ay naIpatupad na,at may layunin na ipagpaliban ang

pananagutan nang pagbigay, ang mga sumusunod na patakaran ay dapat ipatupad
kong may pag unlad, pagkawala o pag kupas o pagbaba ng halaga sa panahon na ang
mga kundisyon ay suspendido pa;
1. Kung ang bagay ay mawala na walang kasalanan ang may utang ang
pananagutan ay mawawala din.
2. Kung ang pagkawala ng bagay ay kasalanan ng may utang, mananagot siya
magbayad ng danyos at ipagpapalagay ang gayon bagay ay hindi na
muling mababawi pa.
3. Kung ang bagay ay kumupas o sumama na, ang may utang ay walang
kasalanan, ang pagpapagawa o pagbabalik ng dating kaanyoan ay sa sagutin
ng nagpapautang.
4. Kung ang pagkupas o pagbaba ng halaga ay kagagawan o kasalanan ng may
pagkakautang ang nagpapautang ay magpapasiya upang pawalan
saysay/kansilahin ang obligasyon at pagsasakatuparan noon na may kabayaran
sa danyos alin man sa dalawa ang pipiliin nya.
5. Kung ang bagay ay umunlad ng natural o ng panahon, ang kaunlaran ay sa
pakinabang ng nagpapautang.
6. Kung ang pagunlad ay kagagawan ng may utang wala siyang karapatan
maliban sa karapatan ipinagkaloob ng usufructuary o sa frutas or prodokto ng
bagay mismo pagaari ng ibang tao..
Pahinuhod/Babala: ang mga nasabing pagkawala ay, pagkawala physical,pagkawala
legal at pagkawala na civil.
Article 1190
Kapang ang kundisyon ay maylayunin na mawala ang obligasyon magbigay, ang mga
nagkasundo, sa oras na nagawa na ang mga napag-usapan kundisyon, ay mag sasauli
sa isat-isa anu man ang natanggap nila.
Sa pagkakataon may mawala kumupas o gumanda ang bagay ang probisyon kung
saan, ang mangungutang, ay itinakda na sa mga naunang artikulo ang susundin ng
sino mang partido na dapat mag sauli.
Ayon naman sa obligasyon gumawa o hindi gumawa, ang probisyon ng ikalawang

saknong ng artikulong 1187 ang siyang dapat masunod tungkol sa apikto ng
pagkawala ng obligasyon.
Pag puna: walang kasong halimbawa.
Ang artikulong ito ay magagamit sa mga usapan may resolutory at suspensive na

considerasyon;
Resoluroty, ay kundisyon kung saan ang usapan ay magkakabisa lamang sa oras na

mangyari na ang kundisyon itinalaga upang tuparin na ang napag-usapan. Halimbawa
ibibigay ko kay pastor ang aking inahing baka kapag hindi siya umalis ng bansa sa
loob ng tatlong taon, pagkaraan ng dalawang taon si pastor ay nangibang bansa, dapat
niyang isauli ang inahin kasama ang kanyang guya.
Suspensive, ay kudisyon kung saan na sa oras na ang itinakdang kundisyon ay

magyari na saka pa lamang ang kasunduan magkakabisa. Halimbawa, habang dalaga
ka Ining susuportahan kita sa pang araw-araw mong kailngan
di nagtagal si Ining nag asawa, ang pangkong suporta ay mawawa na.
Article 1191
Ang kapangyarihan na pawalan bisa ang obligasyon ay tuwiran sa isang palitan

obligasyon, sa pangyayaring isa sa may mga pananagutan ang hindi tumupad kung
anu ang nararapat gawin niya.
Ang naapi ay pipili sa pagitan ng pagsasakatuparan o . ipawalang saysay ang

obligasyon na mayroon kabayaran ang mga damyos alin man sa dalawa. Maari rin
niyang hilingin ikansila, pagkatapos niyang magpasiya ng pagsasakatuparan, kung
ang huli ay magiging imposibli na.
Ang hukuman ay mag uutos para sa pagkansila ng hinihingi, maliban kung mayroon
makatarungan paguutos sa pag tatakda ng titiyak panahon.
Ito ay nauunawaan na walang makakasama sa mga karapatan ng taong walang

kinalaman na siyang naka kuha ng pagmamay-ari ng bagay, sang-ayon sa atikulonh
1385 at 1388 at ang batas sa pagsasangla.
Article 1192
Kapag ang parehong partido ay nagkasala sa hindi pagtupad sa anumang obligasyon,

ang pananagutan ng unang lumabag ang mabibigyan ng karampatang kahatulan ng
hukuman . Ngunit kung hindi matiyak kung sinu sa mga partido ang hindi sumusunod
o tumupad sa kontrata ay parehong hindi makakatanggap ng anu mang
kapakinabangan at parehong managit sa kanilang pagkakamali.
October 3, 1985
Central Bank of the Phil. & acting Dircetor Artemio T. Castro jr. of the Dept. of
commercial & savings bank, in his capacity as statutory reciever of island savings
bank-petitioner
vs.
C.A. & Supicio M. Tolentino – respondent

FACTS:
a.) April 28, 1965 Island savings bank approved the loan application for P80,00.00 of
Sulpicio Tolentino executed on the same day a real estate mortgage over his 100-
hectare and located in cubao, Las Nievas, Agusan. The loan amouny is payable in
semi annual installment for a period of 3 years with 12% annual interest.
b.) May 22, 1965 a mere P17,000 of P80,000 loan was made by the bank. Sulpico
Tolentino and his wife signed a promissory note for P17,000 at 12% annual interest
and on July 23, 1965 have been informed by the bank that there was no fund yet
available for the release of the P63,000 and promised it repeated by vice -president
and treasurer.
c.) August 13, 1965, Monetary Board of central bank was suffering liquidity
problems, issued reso. no1049.
d.) August 1, 1968, Island Savings Bank due to non payment of P17,000 covered by
promissory note , filed an application for extra judicial foreclosure of the real estate
mortgage covering the 60-hectare land of Sulpicio Tolentino.
e.) January 20, 1969 Sulpicio Tolentino filed a petition with CFI of Agusan for
injunction, that he is entitled to specific performance by ordering Island Saving Bank
to deliver the P63,000 with interest of 12% per annum from April 28, 1965 and if said
balance cannot be delivered, to rescind the real estate mortgage.
f.) January 21, 1969, The trial court issued a temporary restraining order enjoining the
island savings bank from countinuing the foreclosure of the mortgage.
g.) February 15,1972, Trial court rendered its decision ordering the Sulpicio Tolentino
to pay Island Savings Bank in the amount of P17,000 and legal interest and charges
due, lifting the restraining order for sheriff may proceed with foreclosure.
h.) Febrary 11, 1977, The CA on appeal by Sulpicio Tolentino modified the CFI
decision affirming the dismissal of Tolentino’s petition for specific performance, but
it ruled that dismissal of Tolentino’s petition for specific performance but it ruled that
Island Savings Bank can neither foreclose the real estate mortgage nor collect the
P17,000 loan.
ISSUE:
Whether or not both parties committed a breach of obligation and they are both liable
for damages.
HELD:
Yes, Since both parties were in default in the performance of their respective
reciprocal obligations, that is, Island Savings Bank failed to comply with his
obligation to pay his P17,000 debt within 3 years as stipulated, they are both liable for
damages.
CA decision is modified , Sulficio Tolentino is ordered to pay the petitioner , and in

case fails to pay, his real estate shall be foreclose. Real estate mortgage is declared
unenforceable.
SECTION 2: OBLIGATIONS WITH A

PERIOD
Article 1193
Obligasyon kung saan ang kanyang katuparan ay itinakda ay maaring hingin lamang
sa tiyak araw ay dumating na.
Obligasyon na mayroon hinihintay na panahon ay maybisa kaagad, ngunit mawawala

kapag dumating na ang tiyak na araw na yon. Ang tiyak na araw ay nauunawaan na
iyon ay tiyak na darating bagamat hindi segurad kung kailan.. Kung ang kawalan ng
katiyakan maging ang yaong raw ay darating o hindi, ang obligasyon ay mayroon
pasubali, at iyon ay babatasan ng mga patakaran ng naunang bahagi.
Case: Ernest Berg v. Magdalena Estate, Inc. (92 PHIL. 110),

October 17, 1952
FACTS PETITIONER: Ernest Berg

RESPONDENT: Magdalena Estate
PONENTE: Bautista Angelo, J.
Ever since September 22, 1943 plaintiff, Berg and defendants under
Magdalena Estate, Inc. were co-owners of the Property, Crystal Arcade. One
third of it belonged to the plaintiff-petitioner and two thirds, to the defendant-
respondent. These parties executed a deed of sale that should either of them
sell his share, the other party will have an irrevocable option to purchase it at
the seller’s at the seller’s price. The two, eventually had a disagreement on
what really happened with regard to the deal.
On January. 1946, the petitioner offered his share for Php 200,000 and was
accepted by the defendant, including the stipulation that Berg was giving the
defendant a period of time which, including the extensions granted, would
expire on May 31, 1947.
The defendant claimed that, in spite of the acceptance of the offer, plaintiff
refused to accept the payment of the price and that because of this, they
suffered damages in the amount of Php 100,000 and asked for specific
performance. The plaintiff argued that this transaction, referred to by the
defendant, is not supported by any note or memorandum subscribed by the
parties and that this transaction falls under the statue of frauds and cannot be
the basis of the defendant’s special defense.
In an application to sell or dispose their properties, both parties filed for

separate applications regarding the subject property. In the defendant’s
application, it desired a license in order “to use a portion of the P400,000
requested as a loan from the National City Bank of New York, Manila, or
from any other bank in Manila, together with funds to be collected from old
and new sales of his real estate properties, for the purchase of the one-third
(1/3) of the Crystal Arcade property in the Escolta, Manila, belonging to Mr.
Ernest Berg.
The lower court found that there was no agreement reached between the
parties regarding the purchase and sale of the property in question, it granted
the case in favor of the petitioner.
Whether the term of payment stipulated in the defendant’s application for

license to sell/purchase, “until they have obtained Php 400,000 from the
National City Bank of New York, or after it has obtained funds from other
ISSUE/S sources”,is in line with the Civil Code
Article 1193. Obligations for whose fulfillment a day certain has been fixed,
shall be demandable only when that day comes.
Obligations with a resolutory period take effect at once, but terminate upon
arrival of the day certain.
A day certain is understood to be that which must necessarily come, although

it may not be known when.
If the uncertainty consists in whether the day will come or not, the obligation
is conditional, and it shall be regulated by the rules of
the preceding Section. (1125a)

LAWS
HOLDINGS Yes. The term of payment stipulated in the defendant’s application for license
to sell/purchase, “until they have obtained Php 400,000 from the National
City Bank of New York, or after it has obtained funds from other sources”,is
in line with the Civil Code (Art. 1125).
A day certain is understood to be that which must necessarily arrive, even
though it is unknown when. In order that an obligation may be with a term, it
is, therefore, necessary that it should arrive, sooner or later; otherwise, if its
arrival is uncertain, the obligation is conditional. To constitute a term, the
period must end on a day certain.
In considering this article as to which the defendant relies for the enforcement
of its right to buy the property, it would seem that it is not a term, but a
condition. Considering the first alternative, that is, until defendant shall have
obtained a loan from the National City Bank of New York – it is clear that the
granting of such loans is not definite and cannot be held to come within the
terms “day certain” provided for in the Civil code, for it may or it may not
happen.
The loan did not materialize. And if we consider that the period given was
until such time as defendant could raise money from other sources, we also
find it to be indefinite and contingent and so it is also a condition and not a
term within the meaning of the law.
Both parties did not put the terms in their agreement clearly in writing. The
lower courts’ judgment is affirmed.
Article 1194
Sa oras ng pagkawala, pagkupas o pag unlad ng bagay bago dumating and tiyak na
araw, ang patakaran sa articulong 1189 ang siyang masusunod.
Article 1195
Ano man naibinigay nakabayaran bago dumating ang itinakdang panahon, ang may
pagkakautang na hindi alintana ang nakatakdang panahon o sa kanyanyang paniniwala
na ang kanyang obligasyon ay dumating na sa itinakdang panahon at dapat nang
singilin , ay maaring bawiin kasama ang mga bunga at tubo nito.
Paalala wala kaso nababanggit ang artikulong ito.
Article 1196
Kung kailan sa isang obligasyon may panahon na itinalaga iyon ay ipinagpapalagay

na itinakda para sa pakinabang ng magkapwa ang nagpapautang at ang nangungutan,
maliban kung kula sa usapan na katulad at ibang pangyayari iyon ay maipapakita na
ang panahon ay itinalaga para sa pakinabang ng isa o sa kabila.

ABESAMIS VS. WOODCRAFT WORKS, INC.
FACTS:
This case was a contract in the delivery of logs before the end of July 1951 but not
earlier than April of same year as an option depending on availability of logs and
vessels between Woodcraft Works and Abesamis Shipping. The failure of the
appellant to send vessels to Dolores, Samar was because of the storm that swept away
all the log on May 5, 1951. Under contract the delivery period of date was
accomplished and that have been agreed to avoid the storm. Woodcraftworks sued
Abesamis to bear all loss as a result of typhoon
ISSUE:
Whether or not Abesamis is liable to pay of the loss?
HELD:
As a consequence of typhoon that struck on May 5 there was yet no delay on the part
of the Abasamis. The obligation between parties are the reciprocal one, appellant to
furnish the vessel and appellee to furnish the logs. It was also the obligation to benefit
both parties. The period that agreed upon are decided to actually
avoid typhoons.Thecorresponding loss must be shouldered by the appellee.
Article 1197
Kapag ang obligasyon ay hindi nagtalaga ng tiyak na panahon, subalit mula sa

kanyang natural at mga pangyayari iyon ay maipagpapalagay na ang panahon ay
binalak, ang hukuman ang siyang mag tatakda ng lawig noon.
Sng hukuman ang siya rin magtatakda nang haba ng panahon kung iyon ay sasang
ayon sa kagustuhan ng may utanag lamang.
Sa baway pangyayari, ang mga hukuman ang siyan mag papasiya sa gayong panahon
sa ilalim ng pangyayaring mamari iyon ang balakin ng mga partido. Kapag naitalaga
na ng hukuman, ang panahon itinakda ay hini na maari pang baguhin nila.
Halimbawang kaso ay : Cosmic Lumber Co. Inc V Manaois (106 Phil. 1015)
Article 1198
Ang mangungutang ay mawawalan ng karapatan gamitin ang panahon sa mga

sumusunod:
1. Kung pagkatapos ng obligasyon ay napagkasunduan na, siya ay naging dukha,

maliban kung siya ay nagbigay garantiya o sanla para sa utang niya;
2. kung hindi niya nagbigay sa kanyang pinagkakautangan ng guaranita o pangtubos

na kanyang ipinangako;
3. Kung sa pamamagitan ng kanyang kagagawan nawaldas niya ang aknyang

garantiya o pangtubos pagkatapos ng pagkakaroon noon, at kapag sa pamamagitan ng
hindi inaasahan kaganapan ng kalikasan naglaho/
nawala, maliban kung kaagad siya ng kapalit ng isang katulad na bagay;
4. kung ang mayutang lumabag ng kasunduan/usapan, na kung saan ang nagpapautang

ay sumang-ayon sa panahon;
5. Kung ang may utang ay nag tangkang iwasan.
Illustrated Case digest by Allan Pailan
May 16, 1967
Peoples Bank & Trust Co. and atlantic Gulf & Pacific Co. of Mla- Plaintiff-
Appellants
vs.
Dahican Lumber Co., Dahican American Lumber Corp. & Connell Bros. Co.(Phil.) –
Defendants-Apellants
FACTS:
a.) Sept. 8, 1948, Atlantic licensed to do business in the Philippines sold and assigned
all its rights in Dahican lumber consession to Dahican Lumber Co. (DALCO) the total
sum of $500,00.00 of which $50,000.00 was paid to develop the consession, Dalco
obtain various loans from the bank amounting to $250,000.00 from Export-Import
Bank of Washington D.C..
b.) July 13, 1950, Dalco executed in favor of the Bank a security for the payment of
the loan a deed of mortgage covering five parcels of land situated in the province of
Camarines Norte together with the building and other improvements existing thereon
and all personal properties of the motgagor located in its place of business in the
municipalities of Mamburao and Capalonga, Camarines Norte, Dalco executed a
second mortgage in the same properties in favour of ATLANTIC the sum of
$450,000.
c.) Upon DALCO’s & DAMCO’s failure to pay 5th promissory note upon its
maturity, the bank gave them up to April1, 1953 to pay overdue promissory note.
d.) July 13,1950, the date of execution of the mortgages mentioned, the BANK
requested DALCO to submit complete lists of said properties but the latter failed to do
so. In connection with the purchses as appeared in the book of DALCO as due to
Conell Bros. Com. (Phil)-(acting as purchasing agent)The sum of P452,860.55 & to
DAMCO the sum of P2,151,678.34.
e.) December 16, 1952- The corresponding agreements of recission of sale were
executed between DALCO & DAMCO and CONNELL.
f.) January 13, 1953, The bank and that of ATLANTIC, demanded that said
agreements be cancelled but CONNEL and DAMCO refused to do so.
g.) February 12, 1953, ATLANTIC & The bank commenced foreclosure proceedings
in the CFI of Camarines Norte against DALCO & DAMCO. They filed also an ex
parte application for the appoinment of a reciever and the issuance of a writ of
preliminary injunction to restrain DALCO from removing its properties. The court
granted both remedies and appointed George H. Evans as reciever but discharged
upon defendants motion on February 21, 1953.
ISSUE:
Whether or not that defendants are liable for the damages upon breach.
HELD:
Yes, on the question of plaintiff’s right to recover damages from the defendants, the
law (Art 1313 & 1314 of ncc) provides that creditors are protected in cases of
contracts intended to defraud them; and that any third persons who induces another to
violate his contract shall be liable for damages to the other contracting party. Similar
liability is demandable under Arts 20 and 21 which may be given retroactive effects
( Art 225-253) or under Arts 1902 and 2176 of the old Civil code.
The facts of this case,as stated therefore, clearly show that DALCO & DAMCO, after
failing to pay the 5th promissory note upon its maturity, conspired jointly with
CONNELL to violate the provision of the 4th paragraph of the mortgages under the
foreclosure by attempting to defeat plintiffs mortgages lien on the “after acquierd
properties”. As a result, the plaintiffs had to go to court to protect their rights thus
jeopardize. Defendant’s liabilty for damages is therefore clear.
The appealed judgment is affirmed in all respects.
SECTION 3: ALTERNATIVE
OBLIGATIONS
Article 1199
DECEMBER 9, 2014 / JAIME ROBILLON
Ang taong kahaliling mananagot sa ibat-ibang kabayaran ay kailangan isagawa ang

isa sa kanila. Ang Nagpapautang ay hindi maaring pilitin tumanggap ng kabahagi ng
isa at kabahagi ng ibang pananagutan.
Case: Ong Guan Can v. The Century Insurance Co. (46 PHIL. 592),
December 2, 1924
FACTS PLAINTIFFS-APPELLEES: Ong Guan Can and the Bank of the Philippine
Islands
DEFENDANT-APPELLANT: The Century Insurance Co., LTD.
PONENTE: Villamor, J.
The plaintiff owned a building that was insured against fire by the defendant
in the sum of Php 30,000, including the merchandise therein contained in the
sum of Php 15,000. Both the house and merchandise insured were burned in
February 28, 1923 while the policies issued by the defendant in favor of the
plaintiff were still in force.
The CFI of Iloilo granted the case in favor of the plaintiff that The Century
Insurance Co. should pay Ong Guan Can the sum of Php 45,000 as the total
value of the insured house and merchandise. The Insurance Company
appealed that the judgment be modified to permit it to rebuild the house and
that they be relieved from the payment of the sum in which the building was
insured.
Whether the defendant-appellant can rebuild the house burnt as a sufficient

ISSUE/S idemnity to the inured for the actual loss suffered by him.
Article 1199. A person alternatively bound by different prestations shall

completely perform one of them.
The creditor cannot be compelled to receive part of one and part of the other
undertaking. (1131)
LAWS
Yes. The defendant may build the house as an alternative prestation, freeing
him from the payment of the sum in which the building was insured. This
conclusion is in line with The Civil Code’s Article 1131.
Paying the sum in which the building was insured is one of the 2 prestations
provided in one of the clauses stipulating the conditions of the policies. Based
on the same Article of the Civil Code, the complete performance of one of
them is sufficient to extinguish the obligation. While there are several
prestations, only one is due.
HOLDINGS
Article 1200
Bilang patakaran, ang pumili ng kagustohan ay kakaibang karapatan ipinagkakaloob

sa maypakakautang, at iyon ay maaring gawin ng nagpapautang kung iyon ay hayagan
ipinagkaloobsa kanya. ang nasabing karaatan ay maari rin ipagkaloob sa ibang tao
kung iyon ay ibinigay ng maypahintulot ang magkabilang partido.
Ang nasabing karapatan ng may utang ay hindi wagas. Ang ay roon utang ay walang
laya pumili ng pamamaraan magbayad kung saan ang mga iyon ay;(1) ang pagbibigay
ay imposibli nnang gawin,(2) labag sa batas 3) hindi boud ng pananagutan, at
ikalawa, kapag ang mayrroon utang ay mayroon karapatan pumili ng paraan sa
pagbabayadw, kung ang pagsasakaituparan ng mayroon pagkakautang aybnawalan na
karapatan mamili sa paraan ng pagbabayad na iisa lamang ang tangging pamamaraan
ng pagbabayad.
CASE. DIONE
FELIPE AGONCILLO, and his wife, MARCELA MARIÑO, plaintiff-appellees,
vs.
CRISANTO JAVIER, administrator of the estate of the late Anastasio Alano.
FLORENCIO ALANO and JOSE ALANO, defendants-appellants.
FACTS: Three debtors got a loan from Marino and bound themselves to pay
P2,700.00. The loan was swcured by a mortgage of a house and lot. It was agreed
that if upon maturity of the debt, the debtors are insolvent, they would cede the house
and lot to Marino. If the house and lot would not be sufficient to cover the debt, the
balance would be secured by the mortgage of 4 parcels of land belonging to one of the
debtors. The titles were delivered to Marino. As the debt was not paid, Marino sued
the debtors.
ISSUES: Whether or not the stipulation of the parties is valid?
HELD: This stipulation is valid. It is simply an alternative obligation, which is
expressly allowed by the law. The agreement to convey the house and lot at the debt
in money at its maturity is, however, in our opinion perfectly valid. It is simply an
undertaking that if the debt is not paid in money, it will be paid in another way. As
we read the contract, the agreement is not open to the objection that the stipulation is
apacto comisorio. It is not an attempt to permit the creditor to declare a forfeiture of
the security upon the failure of the debtor to pay the debt at maturity. It is simply
provided that if the debt is not paid in money it shall be paid in another specific way
by the transfer of the property at a valuation. Of course such an agreement
unrecorded, creates no right in rem, but as between the parties, it is perfectly valid,
and specific performance by its terms may be enforced unless prevented by the
creation of superior rights in favor of third persons.
Article 1201
Ang pagpili ay walang bisa o saysay o bisa maliban mula sa manahon na iyon ay
ipinagbigay alam.
Napiling kaso; Ong Guan v Century Insurance
ONG GUAN CAN VS CENTURY INSURANCE COMPANY LTD.
Case No. G.R No. L-21196 Feb 6, 1924
Cause of Action : For recovery of Amount On Insurance Policy
Issues: Whether or not judgment by default rendered by lower court should be set
aside?
FACTS:
1. In May 1923, plaintiff instituted axction with the CFI Ilo-Ilo to recover sum of
money due on Insurance policy, copy of the complaint was served upon
defendant though its Ilo-Ilo branch. The defendant files its appearance with the
clerk of court, it is alleged and not denied, was mailed at the City of Manila on
the 5th day of June 1923, lawyer for the plaintiff presented motion praying that a
jugement by default be rendered against the defendant, and said motion was
granted and judgment was rendered.
2. On June 8, 1923 defendant filed motion praying that judgment by default be set
aside, and cited that the notice of appearance was mailed and the steamship
Vizcaya ,carrying mails including said notice did not arrive at Ilo-Ilo in the
usual course until after the time has expired for filing its appearance as the ship
encountered a storm at sea.
3. The CFI denied defendant motion, the second motion was likewise denied by
the CFI hence appealed to this court.
SUPREME COURT RULING:
1. The time fixed for filing papers in a case is generally directory and the court
always has in its power, in the exercise of a proper discretion , to extend time
fixed by law whenever the end of justice, would seem to demand such an
extension ( Wood v Forbes & Farm Ham 5 cal 62).
2. Supreme court ordered and decreed that, defendants appearance be admitted
and that it be given 10 a days period to answer from notice of this decision
3. It is settle rule, that if pleading of other documents essential to a case are
entrusted to the mails in due season and under proper precaution and are lost or
miscarried, it will be ground for vacating a judgment be default ( Boyd Vs
Williams & Overbaught 70 N.J law 1985)
Article 1202
Ang may utang ay mawawalan ng karapatan mamili kung sa mga kabayaran na saan
siya ay tiyakang mauubliga, iisa lamang ang maaring gawin.
Ang halimbawang kaso ay Legarda v Mailhi ( 88 Phil. 637)

LEGARDA, ET AL. VS. MIAILHE
FACTS:
A creditor demanded either Philippine currency or english currency for a mortgaged

contract they agreed in 1943. This choice was made by the creditor. It happened that
during the time of maturity these currencies were outlawed by the Japanese in 1942.
ISSUE:
Whether or not contract maybe closed?
HELD:
No, there are alternatives that can be use to have reasonable payment. Since Japanese
currency are permissible that time. Illegal and impossible solutions are untenable. The
same was agreed that in accordance with the agreement of payment during the
Military Japanese occupation it is the same as the Philippine currency.
Article 1203
Kapag sa pamamagitan ng nagpapautang kagagawan ang may utang hindi makapamili

ayon sa patakaran ng obligasyon, ang huli ay maaring kansilahin ang kasunduan na
mayroon mga damyos
ILLUSTRATION (by Allan Pailan)
A agreed to paint either residential house commercial building of B of P100,000.00,
B however sold his commercial building , the alternative has become impossible
because of the change of ownership.
A has now the option to paint the residential house or rescind the contract with
damages if he suffered any.
Article 1204
Ang nagpautang ay may karapatan para sa kabayaran sa danyos kung, sa sala ng

nangutang, lahat ng mga bagay na maaring maging kabayaran ay wala na, o kung ang
pagsasagawa ng obligasyon ay naging imposible.
Ang kabayaran ay malalaman sa halaga ng huling bagay na nawala, o mula sa huling

puwedeng maging serbisyo na naging imposible gawin.
Danyos maliban sa halaga ng huling bagay o huling serbisyo na puwedeng maibigay o

maisagawa ay maari din na maibigay.
Discussion by Jaime Robillon
This is the effect of loss of object of obligation, if some of the objects of an obligation
have been lost or become impossible even through fault of the debtor , the latter is not
liable since he has the right of choice and the obligation can still be performed. And if,
all of them have been lost or have become impossible through his fault, the creditor
shall have the right to indemnity for damages since the obligation can no longer be
complied with. The basis of indemnity shall be fixed taking as basis the value of the
thing lost.
Article 1205
Kung ang pagpli ay laharang ibinigay sa nagpautang ang obligasyon ay hindi na

magiging alternative mula sa araw na nakapili na ang nagpautang at nailahad ito.
Bago mangyari iyon, and responsibilidad ng nangutang ay pamumunuan ng mga

sumusunod na alituntunin:
(1) Kung ang isa sa mga bagay ay nawala dahil sa hindi inaasang pangyayari, maari
syang magbigay ng ibang bagay na pipiliin ng nagpautang mula sa mga natitirang
bagay, o kung ano man ang natitira kung nag-iisa nalang ito.
(2) Kung ang pagkawala ng isa sa mga bagay ay dahil sa sala ng nangutang, ang
nagpautang ay maaring kumuha mula sa mga natitirang bagay, o sa pamamagitang ng
presyo ng nawalang bagay dahil sa sala ng nangutang na may karapatan para sa bayad
para sa danyos.
(3) Kung ang lahat ng bagay ay nawala dahil sa sala ng nangutang, and pagpili ng
nagpautang ay maibabase sa mga presyo ng bawat isang bagay, kasama na rdito ang
pagbabayad ng nangutang para sa danyos.
Ang mga alituntunin na ito ay masasakop din ang mga obligasyon ng pag-gawa o
hindi pag-gawa kung sakaling isa, iilan o lahat ng mga prestation ay magiging
imposible.

This article refers to a case, when the right of choice belongs to the creditor. In
alternative obligations, the right of choice as a rule belong to debtor, however, a
debtor ay expressly give the right of choice to the creditor. I such case, the provisions
with respect to debtor are laid down in the preceding article. Before the creditor
makes the selction, the debtor cannot incur in delay. The creditor can make a choice in
case wherein; 1) when the thing is lost through a fortuitous event; 2) when a thing is
lost through debtors’ fault;3) when all the things are lost though debtor’s fault. This
article is also applicable to a personal obligation.
Article 1206
Kapag isa lang ang prestation na napagkasunduan, ngunit ang obligor ay maaring
magbigay ng iba pang prestation bilang kapalit nito, ang obligasyon ay masasaad na
facultative.
Hindi magiging liable ang obligor sa pagkawala o pagkasira ng bagay na itinakdang

kapalit, sa pamamagitan ng pagpapawalang-bahala ng obligor. Ang obligor ay
magiging liable lamang sa pagkawala ng kapalit na bagay, sa kanyang pagwawalang-
bahala o pandaraya, kapag nakalipas na ang araw kung kailan kailangan maibalik o
maisagawa ang obligasyon.

A facultative obligation is one where only one prestation has been agreed upon but the
obligor may render another is a substitution. And the effect of loss before substitution,
if the principal thing is lost through the fortuitous event the obligation is extinguished,
otherwise, debtor is liable for damages. The effect of the loss is merely to extinguish
the facultative character of the obligation. The effect after substitution, if the principal
thing is lost, debtor is not liable whatever may be the cause of the loss, because it is no
longer due, and the differences of facultative and alternatives are as follows:
FACULTATIVE:
1.
Only one prestation is due although debtor is allows to substitute it.
2.
the right to make the substitution is given only to the debtor
3.
the loss of thing due extinguish the obligation
4.
the loss of thing due through his fault makes him liable
5.
the loss of the substitute before the substitution though the fault of debtor does
not render him liable.
ALTERNATIVE:
1. several prestation are due but compliance with one is sufficient

2. the right of choice maybe given to the creditor or third party
3. the loss of one or more of the alternative through a fortuitous event does not
extinguish the obligation
4. the loss of one of the alternative through the fault of debtor does not render him
liable
5. where the choice belong to the creditor the loss of one alternative through the
fault debtor give rise to liability.
Kapag tanging isang kapakinabangan lamang ang napagkasunduan, pero maaari na
ang nagpapautang ay humiling pa ng isang kahalili nito, ang obligasyon ay tinatawag
na facultative.
Ang pagkawala o pagkasira ng isang bagay na bilang kahalili, kung di maingatan ng

nangutang ay hindi sya mananagot dito. Ngunit kapag ang kahalili ay nagawa na sya
ay mananagot na kung ito ay magdulot ng abala, mapabayaan o magdulot ng
pandaraya.
Discussion by Bong Reyes

The obligor can give another kind of item; there can be a substitution of an item, if
needed.
ILLUSTRATION:
Kaye promised that she will deliver a canon scanner and printer to Danny because she
cannot give him an HP printer with scanner.
SECTION 4: JOINT & SOLIDARY

OBLIGATIONS
Article 1207
Ang pagsangayon ng dalawa o mahigit pang nagpapautang o sa dalawa at mahigit

pang mga mangungutang sa iisa at katulad na pananagutan hindi ibig sabihin na bawat
isa sa mga nagpapautang maykarapatan maningil o na ang bawat isa sa mga may
utang ay akuin ang buong kanbayaran. Mayroon lamang pinagsamasamang
pananagutan kong ang obligasyon ay nagsasaad nito.
Halimabawa dito ay ang kaso ng mga Roa.

RICARDO ROA V PH CREDIT CORPORATION & COURT OF APPEALS
(JNR)
CASE NO. G.R No. 106037 June 15, 1993
CAUSE OF ACTION: Certiorari
ISSUES: Whether or not the Second Petition applies the Res Judicata Rule
FACTS:
1. In July 1982 PH credit Corp files a complaint with Replevin against Cagayan
De Oro Management Corp (CMC) in the RTC Misamis Oriental, to recover
several tools, equipments and furnitures subject of a chattel mortgage executed
by CMC in favor of PH Credit to secure loans amounting to 484,351.14. CMC
filed a counterclaim, and prayed that it be discharge from paying 3 promissory
notes which it allegedly executed after is was misled by misrepresentation of
the PH Credit. Without awaiting the final desposition of the repliven, PH credit
instituted a deficiency judgment against CMC with the RTC Manila, alleging
that, all real estate mortgage by CMC had been foreclosed but a balance of
2,810,734.30 inclusive of interest and penalties had been left outstanding on the
3rd promissory note executed.
2. RTC Misamis dismissed the case for failure to prosecute the case Civil Case
No. 8651 and ordered the reception of evidence on the counter claims of CMC.
Aug 1988 PH credit filed a third case with the RTC Manila and impleaded
Emeterio Roa Jr and Ricardo Roa in place of CMC which had became
insolvent and filed an appeal with the Court of Appeals, however, the C.A
dismissed the appeal, on reason that there was identity of rights asserted and
relief sought in both replevin and deficiency judgment sought, and in Feb 1989
it annulled RTC misamis ruling on Sept 13, 1988 and prohibited RTC Misamis
from proceeding with the counter claims and to dismiss the CMC counter claim
for failure to prosecute after 5 years from dismissal of the complaint, and the
counter claim was permissive and had not paid the filing fees.
3. Emeterio Roa Jr & Ricardo filed a motion to dismiss case against them on the
ground of Res Judicata / Litis Pendencia, and the case No. 88-45895 were
suspended pending the resolution of case No. 15845. The RTC Manila denied
motion filed by Roa which they subsequently went to Court of Appeals
contesting the RTC Manila ruling. The C.A denied the Roa petition and said
neither the dismissal of the deficiency judgment nor the dismissal of replevin
and the counter claims, bars the prosecution of the second deficiency suit.
1. There was no identity of subject matter, cause of action and relief between the
civil case of replevin and deficiency judgment.
2. Dismissal of C.A case no. 19224 was not a judgment on the merit and cannot
be considered as conclusive adjudication of the controversy. The dismissal was
predicated on 2 grounds ;(a) the pending case 8651;(b) and the prematurity of
cause of action for the foreclosure sale by PH credit which could not proceed
until it could recover possession of the properties chattel s from CMC.
3. A judgment in order to work as res Judicata must be on the merit ( Molder vs
Meller, 104 Phil 731). A judgment dismissing an action because of the
pendency of another suit cannot operate as Res Judicata, which requires
that;a) there must be an earlier final judgment; b). the court which rendered
decision must have jurisdiction of the matter and the parties; c). the judgment
was based on the merit of the case; d). there is between the first and second suit
identity of parties involved, subject matter, cause of action and relief
sought( Francisco vs Blas 91 Phil 1/; Diana vs Batangas Transport co. 93 Phil
391 and Magdangal Vs City of Olongapo 179 SCRA 507).
ARTICLE
Article 1208
Kung mula sa batas o natural o kataga ng obligasyon na tiniran sa nakaraang artikulo

ang ka baliktaran ay hindi hayag ang pautang ay ipinagpapalagay na hati-hati sa
maraming kabahagi kung ilang ang nagpapautang o mangungutang, ang utang ay
liwalay sa isat isa at napapaloob sa patakaran panghukuman ukol sa ibat ibang usapin.
From Dennis to jnr
Article 1209
Kung ang paghahati ay hindi imposible , ang karapatan ng mga may pautang ay
apektado lamang sa kanilang sama-samang mga gawa at ang utang at paniningil ay
maipatutupad lamang sa pagitan ng usapang legal laban sa lahat ng may
pagkakautang, kung isa sa mga may utang ay maghikahos, ang ibang may utang ay
hindi mag aabono ng kanyang kabahagi.
Ang artikulong ito ay tugma para sa pinagsamang hindi mapaghihiwalay na

pananagutan, dahil ang pagbubuklod ay hindi itinalaga at ang pagbabayad o bagay ay
hindi maaring pagbukorin. Ang pinagsamang hindi mapaghihiwalay na pananagutan,
para sa may mga utang ang kanilang pagbabayad ay dapat na may pahintulot ng ibang
may pagkakautang. Para sa mga nagpapautang dapat mayroon ng sama-samang
pagkilos na may pagkiling sa karapatan ng may pautang.
Illustration(by Allan Pailan);
A,B,C,D are solidary creditors, in which E is a debtor, if one of the creditors made an
action to demand from E to fulfill E’s obligation, then E cannot made payment to only
one of the creditors. Payment of E must be made to all.
Article 1210
Ang hindi mapaghahati-hati na pananagutan ay hindi nagbibigay daan sa pinagbuklod,

hindi ibig sabihin na ang pinagsamasama ay mapaghahatihati.
Pagpuna:
Ang hindi pagkakahatihati ay mayroon tatlong(3) uri (1) legal na aspikto (2)
convensyonal (3) pinagbuklod na obligasyon.
Ang hindi mapaghihiwalay na pananagutan ay pagbabayad o bagay na hindi

magagawa maliban baguhin ang kahalagahan o usapan.
Discussion by Ainna Fathi:

An obligation to deliver a live dog is indivisible. If the obligation be made divisible,
the dog will have to be delivered in pieces. In this case, the essence of the object is
destroyed.
Article 1211
Pinagbuklod maaring manatili bagamat ang mga may pautang at mga mangungutang
ay hindi binibigkis ng kapariho paraan at kahalintulad na panahon at kalagayan.
Article 1212
Bawat isa sa mga pinagbuklod na may mga pautang ay maaaring gumawa ng may
pakinabang sa iba, ngunit hindi lahat na maaaring makasama sa iba nilang kasama.
Pagpuna:
Ang pinagsamasamang nagpapautang ay consipto na kaparihong antas ng
pananagutan at pakinabang

Beneficial Acts of Solidary Creditors
All creditors may perform acts that will benefit each other. They may help each other
to have more gains and built up their relationship in good standing.
Prejudicial Acts of Solidary Creditors
If one or more of the member performs acts that will have bad effects, lost of profit or
may harm the good standing he will be liable to his co-creditors.
Article 1213
Sa mga pinagsamasamang mga nagpapautang, hindi nila maaaring ibigay o ipasa sa

iba ang kanyang mga karapatan ng walang pahintulot ang iba pang nagpapautang o
mamumuhonan. At kong walang pahintulot ang isa sa may ari ng pinagsama samang
puhunan ang pagbibigay sa iba ng kanyang mga karapatan ay walang bisa.
Paala-ala wala kaso naka saad ang artikulong ito
Article 1214
Ang may pagkakautang ay maaring magbayad sa isa sa pinagsama-samang

nagpapautang, ngunit kung may paniningil sa hukuman o sa labas ng hukuman ng isa
sa kanila, ang pagbabayad ay dapat doon sa sumingil.
Pagpuna:
Ang may utang ay maaring magbayad sa sino man sa magkakasamang nagpapautang,

at ang pagbabayad kung tatanggapin sino man sa kanilang magkakasamang may
pautang ay mag aalis ng pananagutan.
Illustration (by Allan Pailan):

A,B,C,D are the solidary creditors representing the credit union in which E is a debtor.
if one of them(creditors) or C made a demand on E in order to fulfilled the latter
obligation, E can only made payment to C and that payment is sufficient to effect the
extinguishment of obligation of E.
Article 1215
Paghalili, pagpapalitan, pagbubuklod o pagpapatawad ng utang ginawa ng sinu man

sa sama-samang nagpapautang sa sino man sa magkakasamang may utang, ay mag
papaalis ng pananagutan ng hindi apikto sa susog ng Artikulong 1219.
Ang may pautang na may ginawa alin man sa katulad na gawain, ganun din doon sa
naningil ng pautang ay dapat managot sa iba para sa kabahagi ng pananagutan na
naayon sa kanya-kanyang kabahagi.
Pagpuna:
Pahalili- walang paghahalili kung ang obligasyon ay binago.
Pagpapalitan- ay nagaganap kung ang dalawang tao ay may utang sa isat isa, kapwa
may utang at nagpautang.
Pagsasaisa- kung ang katauha ng may pautang at ang may utang ay iisang tao lamang.
Pagpapatawad- ang pagpapatawad ay isang kusang loob at kabutihan ng kalooban.

When any of these are made by the solitary creditors or with any of the solitary
debtors, the obligation will extinguished without prejudice to the provisions of Article
1219:
(1) Novation – when obligations are modified by:
 changing their object or principal conditions;

 substituting the person of the debtor;
 subrogating a third person in the rights of the creditor
(2) Compensation – when two persons, in their own right, become creditors and
debtors of each other (e.g A owes B Php 2,000, B borrowed Php 2,000 from A)
(3) Confusion Or Merger of Rights – when the characters of the creditor and debtor
are merged in the same person (e.g Company A needs to provide Company B with
janitorial services, Company A merged with Company B and formed Company C)
(4) Remission Or Condonation – the gratuitous abandonment by the creditor of his

right. It is essentially gratuitous and the acceptance by the obligor is necessary (e.g X
owes Z Php 10,000. Z tells X to forget about the Php 10,000 he owes)
Article 1216
Ang nagpapautang ay maaring maghabol labang sa kahit sino sa mga magkakasamang

may pautang. Ang paniningil ng isa sa kanila o sa iba o sa lahat ng sabay-sabay. Ang
pag singil ng sino man sa kanila ay hindi hadlang upang singiin ang sino man sa
kanila habang ang utang kabuuhan ng utang ay hindi pa nasisingil.
CASE. DIONE
PHILIPPINE NATIONAL BANK, plaintiff-appellee,
vs.
CONCEPCION MINING COMPANY, INC., ET AL., defendants-appellants.
FACTS: The present action was instituted by the plaintiff to recover from the
defendants the face of a promissory note.
ISSUES: Can the defendants pray, as a special defense, that the estate of said
deceased Vicente L. Legarda be included as party-defendant.
HELD: No. The court in its decision ruled that the inclusion of said defendant is
unnecessary and immaterial, in accordance with the provisions of Article 1216 of the
Deny Civil Code and section 17 (g) of the Negotiable Instruments Law.
ART. 1216. The creditor may proceed against any one of the solidary debtors or some
of them simultaneously. The demand made against one of them shall not be an
obstacle to those which may subsequently be directed against the others so long as the
debt has not been fully collected.
The case was filed only against the defendants and the judgment cannot be executed
against the other co-debtors who were not made parties in the complaint.
Article 1217
Ang bayad ginawa ng isa sa magkakasamang mangungutang magaalis na ng

obligasyon. Kung dalawa o mahigit pang kamangungutang ang nag alok ng bayad,
ang nagpapautang ang pipile kung alin alok ang kanyang tatanggapin.
Sino man ang nagbayad ay maaring maningil sa kanyang kapwa mangungutang ayon
sa kani-kanyang parti kasama na iyong tubo na nabayaran na. Kung ang pagbabayad
ay ginawa bago dumating ang nakatakdang pagbabayad, walang tubo para sa
nasasakop na panahon ang dapat singilin.
Kapag isa sa magkakasamang mangungutang ang hindi makapagbayad dahil sa

kanyang kadukhaan, ang kanyang kaparting babayaran ay sasagutin na ng kanyang
kasamang mangungutang ayon sa kanilang kabahagi ng pananagutan
Mga halimbawang kaso:
Joseph v Bautista 170 SCRA 540 / BPI v McCoy 52 Phil. 831
Case: BPI v. MAY MCCOY (G. R. No. L-30111)
On June 19, 1919, Mc Coy, deceased, and the present six appellants, with three
others, were interested in a domestic corporation known as Cooperative Coconut
Products Co., Inc., and became liable to BPI for money advanced by the bank to
the said corporation. When the company did not prosper, the six appellants
FACTS addressed to the bank a demand letter.

ISSUE/S
Whether or not the letter must be accepted to be considered valid?

LAWS Article 1217
The letter of August 21, 1922, from the President of the bank have sufficient
notification of acceptance, when the bank acted to that offer, the appellants and Mc
Coy became obligated according to the terms of the letter. The word acceptable
was evidently used as “accepted”, the final paragraph suggests that the property
should be awarded to the bank, signatory parties should protect themselves in
bidding. The opinion of two bank’s acceptance should be in precise form indicated,
which could not have been considered material to the writers of the letter. The
judgement of the trial court against the said six defendants, requiring them to pay
to their former codefendant, but now plaintiff, the sum of P 1,714.28 and other
HOLDINGS proportional part and legal interest was affirmed.
Article 1218
Ang pagbabayad ng kasamahang mangungutang ay walang karapatan maningil sa

kanyang pawang magnungutang kung ang nasabing pagbabayad ay isinagawa
pagkatapos ang obigasyon magbayad ay mapaso na o naging iligal na.
Pagpuna:
Ang artikulong ito ay angkop doon sa:
1. Utang na paso na ayon sa panahon itinakda ng batas.
2. Ang obligasyon o pagbabayad ay bawal na sa batas bago pa mabayaran ang

utang/obligasyon
ang sino man nagbayad ay hindi na sasaulian / babayaran pa.
Article 1219
Ang pagpapatawad na ginawa ng isang nagpapautang sa kabahagi ng isang may

pagkakautang, di nangangahulugan na wala na siyang pananagutan sa kapwa o iba
kamangngutang nya, kong sakali ang kabouhan ng utang ay binayaran nang sino man
sa kanila bago magkabisa ang pagpapatawad.
Paala-ala wala kaso nakasaad sa artikulong ito.

Article 1220
Ang pagpapatawad sa buong pagkakautang ay nakuha sa pamamagitan ng isa sa

magkakasamang mangungutang wala siyang karapatan na manghingi mula sa kapwa
niyang mangungutang.
Pagpuna:
Ang pagpapatawad ay isang kabutihan loob o awa at walang anu man ibinayad.
Sa kabahagi na pagpapatawad, sino man ang mag bayad doon sa parti na hindi
pinatawad o ipinagpaubaya, ang sino man nagbayad ay maaring niyang singilin ang
iba ayon sa kanikanyang kabahagi ng utang.

Illustration:
A, B and C are solidary debtors to D. They owed D Php 20,000 that B offered to pay.
D, being a kind and impulsive person, remitted the amount to B. The obligation is
extinguished and B is not entitled to reimbursement from A and C as B did not spend
anything for the remission granted by D as it is a gratuitous one.
Article 1221
Kung ang bagay ay nawala na o kung ang pagbabayad ay imposible na walang

pagkakamali ang magkakasamang mangungutang, ang pagbabayad ay mawawala na.
Kung mayroon kasalanan ang sino man sa kanila ang lahat ay mananagot sa mga
nagpapautang para doon sa prisyo at kabayaran ng damyos at tubo, na walang sagabal
na maghabol laban sa napatunayan o nagpabayang kasamang mangungutang.
Kung sa pamamagitan ng kalikasan / hindi inanasahan pangyayari, ang bagay ay

nawala o ang pagbabayad naging imposible na pagkatapos ng isa sa
magkakasasamang pangungutang ay na antala sa pamamagitan ng panghukuman o
labas sa hukuman paniningil , ang mga susug ng artikulong 1147 ang masusunod.
Article 1222
Ang magkakasamang mangunugtang, sa isang pagkilos laban sa maypautang ay

maaring gumamit ng mga depinsa na magmumula sa natural na obligasyon at mula sa
mga pang pesonal niyang depinsa at sa kanyang kabahagi na utang.
At doon naman sa mga nauukol sa ibang may utang, maari rin syang maging kasama
ngunit doon lamang sa bahagi na sya ang may responsibilidad.
Case Digest by Bong Reyes:

BRAGANZA VS. VILLA ABRILLE
FACTS:
Miss Braganza had a two sons because of insufficient funds to support her children
she owed P10,000.00 to Villa Abrielle. She signed a promissory note binding herself
and her two sons as solidary debtors. Two years after the war Villa Abrielle sued her
for not paying her debt.
ISSUE:
Whether or not minority of co-debtors can release them in their obligation?
HELD:
No, minority of children cannot release the mother in their responsibilities, if they
used this as a defense, minors can only plead it and one the first place Braganza did
not tell Villa Abrielle that her children are minors that if he only knew it at first he
will not lend them the money.
SECTION 5: DIVISIBLE &

INDIVISIBLE OBLIGATIONS
Article 1223
Ang pagkakabahagi at hindi pagkakabahagi ng mga bagay na siyang dahilan ng

pananagutan/obligasyon kung saan iisa lamang ang may pagkakautang at iisa din
lamang ang nagpapautang ay hindi magpapabago sa mga susug ng chapter 2 ng
titulong ito.
1. Ang pagkakabahagi ay ang kakayahan na bayaran o isagawa ng kabahagya lamang

ng bagay.
Halimbawa: Ang pangako na mag bigay 50 pirasong TV sa tiyak na gawang pangalan

o tatak.
2. Ang hindi pagkakabahagi ay ang kawalang kakayahan bayaran o isagawa bayaran

ng bahabahagi lamang.
Halimbawa: Ang pangako na mag bigay ng kotse anu man tiyak na gawang pangalan
o tatak.
Article 1224
Ang magkakasamang hindi mapaghahati-hati panagutan ay mag reresulta ng

pagbabayad ng mga damyos mula sa oras na hindi tumupad ang maypagkakautang sa
itinakdang usapan. Ang may utang na handa na tumupad sa kanilang pangako, ay
hindi na mag aambag sa kabayaran lampas sa bahagi na halaga nakabahagi ng
kanilang pananagutan.
ILLUSTRATION by Allan Pailan
In Joint Obligation:
A & B contracted to deliver television LED monitor in the amount of P50,000 to C
A is ready to pay P25,000 while B failed to produce P25,000. A is not liable to pay for
C the obligation of B.
In Solidary Obligation: (using the same case as above)
A is liable to pay the entire P50,000 or reciprocally to C even B failed to give his
P25,000, B is liable to pay A the said amount.
JOINT OBLIGATION – the entire obligation is be paid by debtors proportionately.
SOLIDARY OBLIGATION- each on of the debtors is obliged to pay the entire

obligation, each one of the creditors has the right to demand from any debtors the
payment of the entire obligation.
Article 1225
Para sa gamit ng naunang talata, obligasyon magbigay ng tiyak na bagay at sa bagay

na hindi maaari ang paunang pagsasakatuparan ay ipinagpapalagay na hindi maari
pagpirapirasuhin. Kong ang pananagutan ay may inilaan bilang ng araw ng paggawa,
ang pagsasagawa ng gawain ayon sa maliliit na bahagiat mga kahalintulad na bagay
na maaringn natural na isagawa ng paunti-unti ay divisible.Ganun paman baga mat
ang bagay o servisyo ay maaari physically pueding paghati-hatiin, ang ogligasyon is
hindi maari pag pirapirasuhin kong yaon ang nakatadhana sa batas at pakay ng mga
nagkasundo. Ang obligasyon huwag gawin, mapaghihiwalay man o hindi
mapaghihiwalay ay malalaman sa katangian ng pagbabayad sa bawat tanging
pagkakataon.
(Ang kaso naka saad ay Soriano v Ubat 1 scra 366). JNR
Case No, G.R No L-11633 Jan 31, 1961
Cause of Action: Collection for sum of money evidence by promissory notes
Issues: whether or not the obligation assumed from Eduardo Ubat was divisible?
Facts:
1. Eduardo Ubat obtained a a loan of 400.00 secured by mortgage land covered by
OCT 561 after paying his 3rd installment payment he died. Francisco his son
inherited the mortgage land and Sept 1946 Francisco Ubat borrowed money
amounting to 400.00 from PNB where is father got a loan, he also executed a
chattel mortgage on the standing crops of his land cover by OCT no. 3231
Francisco also died in Sept 1954 with an unpaid balance of 82.00. Later his
children instituted a summary proceeding of his estate wherein the PNB also
files its claims, but the court dismissed PNB claims in that summary
proceeding.
2. July 1955 Jose Soriano a creditor of Francisco files an intestate proceeding with
the CFI Davao, wherein 2 parcel of land were covered with OCT No. 561 and
OCT No. 3231. PNB again filed 2 cliams First, for the 82.00 unpaid loan and
the Second, was for 310.37 the outstanding loan of late Eduardo Ubat.
Consequently, the court allowed the first claim on the second claim only 55.23
was allowed. The appellant Soriano construed that the obligation assumed by
deceased Eduardo was divisible because its payment was stipulated to be in 10
equal yearly installment and when the 4 th installment become due and payable,
the prescription period of ten years commenced to run nd only the
10thinstallment of 59.61 fell due in Oct 1945 was recoverable when the present
claims was filed in Sept 1955.
1. The court orders to pay PNB in the amount of 98.38 with interest at daily rate
of 0.0133 from sept 19, 1955 and for second claim the sum of 191.15 with
interest of 8 & per annum from Sept 18, 1955. And that the 100.00 attorney’s
pay was reasonable.
2. The court sustain PNB contention that suspensive effect of the moratorium law
on unpaid account namely, the cliam for the 6th installment which fell within the
ten years prescriptive period. On the 4 th and tht 5th installment in the amount of
119.22 are no longer collectible as they prescribed already.
3. The prescription period start at the time when the action is actually filed not
from the time parties wishes to file an action.
4. Parties could not have intended a divisible obligation because there was no
fixed date was agreed upon as to the payment of each or every installment. It
was clear in the promissory notes, that the installment were to be settle at the
end of every year from year 1 to year 10. GThe statute of limitation
consequently begin to run as to each and every unpaid installment from the date
that the bank can sue their debt.
5. In absence of the special provison, the prescription for all inds of action be
counted from the day the action maybe actually brought to the attention of the
court.
SECTION 6: OBLIGATIONS WITH A
PENAL CLAUSE
Article 1226
Sa pananagutan mayroon nakasaad na parusa, ang kaparusahan ay papalit sa

kabayaran ng damyos at ang kabayaran ng mga tubo sakaling ng hindi pag tupad noon
at kung walang napagkasunduan. Ganun paman, mga damyos ay dapat bayaran ng
may pagkakautang na ayaw magbayad ng tubo o mapatunayan ng hindi tuwiran pag
tupad ng kanyang pananagutan.
CASE. DIONE
THE MANILA RACING CLUB, INC., plaintiff-appellant,
vs.
THE MANILA JOCKEY CLUB, ET AL., defendants-appellees
FACTS: This action is filed by the plaintiff against the Manila Jockey Club and its
partners for the recovery from them of the forfeited amount of P100,000 and for the
payment of P50,000 as damages. The appealed judgment absolves the defendants.
ISSUES: Does forfeiture of what has been already paid, by reason of the failure to
pay other installments constitute penalty?
HELD: Yes.This clause regarding the forfeiture of what has been partially paid is
valid. It is in the nature of a penal clause which may be legally established by the
parties (article 1152 and 1255 of the Civil Code). In its double purpose of insuring
compliance with the contract and of otherwise measuring beforehand the damages
which may result from non-compliance, it is not contrary to law, morals or public
order because it was voluntarily and knowingly agreed upon by the parties.
Article 1227
Ang maypagkakautang ay hindi pinapawalan ng pananagutan upang isakatuparan ang

kanyang panangutan bayaran ang tubo maliban kung ang nasabing karapatan ay
nakatalaga para sa kanya. Ang nagpapautang ay hindi rin maaring obligahin na
bayaran ang panagutan at ang tubo na magkasabay maliban kung ang ganun karapatan
ay maliwanag na ibinigay sa kanya. Subalit kung ang nagpapautang ay nagpasiya na
singilin ang pagbibigay ng kabayaran, kung ang pagbabayad maging imposible ng
walang kasalanan, ang tubo ay maaring ipatupad.

The general rule is that debtor cannot exempt himself in paying the penalty only and
not giving the principal. The exemption is when the debtor was granted the right to
pay the penalty and not the principal amount.
ILLUSTRATION:
When A contracted with C for the construction of a building in which they are agreed
to finish it in two months. Then, C did not manage the construction instead his son
took place in this. A was dismayed and sued C for the penalty of not finishing the
project on time and not using exact materials he told C. The owner can confiscate the
amount and penalty to the contractor who violate the contract.
Article 1228
Ang patunay ng tunay na mga damyos na sinapit ng maypautang ay hindi kailangan

upang ang tubo ay singiin.
Leon J. Lambert v T.J Fox G.R No. L-7991 Jan 29, 1914 (26 Phil. 588)
Cause of Action : To recover a penalty for breach of contract
Issues: whether or not there was violation to their agreement and their agreement was
valid?
Facts:
1. John Edgar & company was engaged in retail business buying and selling books &
stationary, it suffered financial trouble to save the collapsed of the said company
creditors agreed to convert their credit into share of stock equivalent to amount they
lent to the company.Lambert and Foc became the major stockholders of the company.
After the incorporation of the firm was completed Lambert and Fox agreed that
neither or both of them sell or transfer their holding in the company until after one
year which they believed after a year the company would become financially stable.
They agreed that 1,000 penalty would be paid in case any of them violated the said
agreement. After 9 months Fox believing that John Edgar & Company was already
stable sold his shared to their rival company McMullough. The sale was protested by
Lambert and reminded Fox on their prior agreement. After Fox sold his shares to Mc
Mullough Lambert sued him with CFI, however the trial court decided inf favor of
Fox on the reason that company was already stable and that Fox fulfilled his
obligation and taht their agreement should be good and continue until the company
become financially sound, Lambert appealed
Supreme Court Ruling:

1. It held that the trial court erred in its construction of the contract.
2.the intention of the parties to a contract must be determined, the contract itself,
which it presumed that what they said or speak in clear language is what they meant.
3. Where language used by parties is plain and clear, construction and interpretation
are unnecessary, the court do not interpret but implement the law.
4. Fox should pay Lambert their agreed penalty in the amount of 1, 000.00
Article 1229
Ang hukom ay makatuwiran babaan ang tubo kapag ang kabuuhan ng obigasyon ay
bahagya o hindi natupad ng may pagkakautang. Ganun din kung hindi pa
nakapagbayad, ang tubo ay maaring babaan ng hukuman kung ito at hindi
makatarungan at patas.
The Bacharach Motor Co. Inc. vs. Faustino Espiritu, Rosario Espiritu Nov. 6,
1928
FACTS:
a.) July 28, 1925-The defendant (Faustino Espiritu)purchased plaintiff corp. a two-ton
white truck for P11,983.50, paying P1,000.00 down to apply on account of this price
and obligating himself to pay the remaining P10,983.50 within the period agreed
upon.
b.) The defendants mortgaged the purchased trucks and three others which are
numbered 77197 and 92744 respectively to secure the payments.
c.) The defendant failed to pay P10,477.82 of the price secured bu mortgage.
d.) In case 28498 dated Feb. 18, 1925-defendant bought a one-ton white truck of the
plaintiff corporation for the sum of P7,136.50 and the P500 cash deducted and 12
percent annual interest on the unpaid principal, obligated himself to make payment
within the periods agreed upon and mortgage truck 77197 and 92744 respectively in
purchased of the other truck.
e.)The defendant failed to pay P4,208.28 if the sum.
f.) In both sales, it was agreed that 12 percent to be paid upon portion of the unpaid at
execution of contracts, if failed to non-payment in its maturity, 25 percent thereon as
penalty.
g.) The defendant signed a promissory note solidarily with his brother Rosario
Espiritu for several sums secured by the two mortgages.
ISSUE:
Whether or not that the plaintiff has the right to impose higher interest as penalty
twice the fixed rate by law.
HELD:
No, Article 1152 of the civil code permits the agreement upon a penalty apart from the
interest.Should there be such agreement, penalty, does not include the interest; and
which may be demanded separately (as was held in case of Lopez vs. Hernaez-32 phil
631), but considering that the obligation was partly performed and making use of the
power given to the court by article 1154 of the civil code, the penalty is reduced to 10
percent of the unpaid debt.
The judgment appealed from is affirmed.

Article 1230
Ang kawalan bisa ng tubo sa kasunduan ay hindi kasama ang tubo sa pangunahing
pananagutan. Ang kawalan bisa ng pangunahing panangutan ay kalakip ang kawalan
pananagutan sa tubo
GENERAL PROVISIONS OF
EXTINGUISHMENT OF OBLIGATIONS
Article 1231
JANUARY 11, 2015 / AINNA MACALOS-FATHI
Ang mga obligasyon ay mawawala o matatapos kapag nangyari na ang mga

sumusunod na bagay:
1. Sa pagbabayad ng pag gawa o pag ganap o performans.

2. Sa pagkawala ng bagay ng kailangan ibayad o ibigay.
3. Sa pagbibigay ng kapatawaran o ng pagbabalewala ng utang.
4. Sa paglalagom ng mga karapatan ng nagpautang at umutang.
5. Sa pagbabayad ng utang.
6. Sa pagpapalit ng panibagong obligasyon.
Ang mga ibang dahilan ng pagkatapos o pagkawala ng obligasyon katulad ng
annulment, rescission, at pagsagawa o katuparan ng resolutory condition, and
prescription, ay pinamamahalaan ng ibang artikulo mula sa Code na ito.
SECTION 1: PAYMENT OR
PERFORMANCE
Article 1232
JANUARY 29, 2015 / ALLAN PAILAN
Ang pagbabayad ay hindi lamang yaon pagbibigay ng pera kundi yaon ding
kakayahan sa paggawa sa ano mang uri ng obligasyon.
Article 1233
Ang utang ay hindi dapat ipinagpapalagay na bayad na maliban na ang mga bagay o
serbisyo na napapaloob sa obligasyon ay kumpletong naibigay na o naisagawa, kung
anu man ang maaaring sitwasyon.
Case: Rafael Ramos Vs Tomas Ledesma ( Art 1233 JNR)

12 Phil. 656 Feb 01, 1909
PETITIONER: Rafael Ramos
RESPONDENT: Thomas Ledesma
PONENTE:
In July 1907 Rafael Ramos, administrator of interstate of the Estate of Jose Ramos
Silva & his wife Margarita filed complaint against Thomas Ledesma, claiming
payment of 2,450.09 and legal interests. Ledesma according to documents owed
Jose Ramos which was due and payable in May 1903, to guarantee payment,
mortgaged to creditor certain land owed by Ledesma at Calasa in Brgy
Cabangcalan Negros with TCT Bo. 6750 recorded at inspeccion de Montes,
notwithstanding demand , Ledesma had not satisfied his debts which Ramos pray
judgment be rendered and sentence Ledesma to pay.
Defendant in defense denied all allegations against him except that he owed to the
late Jose Ramos and apparently the same as claimed by complainant, but that in
May 1905 he paid 1,701,09 and therefore pray he be absolved from payment.
Ledesma did not appeared in the hearing and default judgment was made and
sentenced him to pay the amount claimed. Later Ledesma requested the court to
vacate the judgment issued and he be given opportunity to produce evidence to
contest the complaint. The trial court set aside its previous ruling, Ledesma this time
moved for new trial on reason that, judgment was contrary to evidence and the law.
FACTS
Whether or not the debt shall not be considered paid unless the thing or service has been
ISSUE/S completely delivered
Article 1233 A debt shall not be understood to have been paid unless the thing or service
in which the obligation consist has been completely delivered or rendered , as the case
LAWS maybe
1. Affirmed the trial court decision.
2. The payment claimed to have been paid belong to different obligation of the
defendant, the payment received marked A for sum due on promissory note No. 1
they constitute two different and distinct debts.
3. It can be assumed that an obligation has been paid when the evidenced existed
has been returned to the debtor.
4. When debts of which action is brought arises from obligation other than those
appearing s paid in the receipt by which it is intended to prove payment, a
judgment finding said debt is paid is in violation of Art 1156.
5. Art 1156 of civil code says, obligations are extinguished by their payment or
fulfillment, a debt shall only be considered as paid when the full amount of the thing
has been delivered.
HOLDINGS
Article 1234
Kung ang obligasyon ay matatag na naisakatuparan na tapat at mabuti, ang inutangan

ay maaaring makabawi bagaman nagkaroon ng istrikto at kumpletong katuparan, mas
mababang danyos lamang ang mararanasan ng nangungutang.
J.M. Tuazon & Co. inc.(plaintiff-apellant) vs. Ligaya Javier (Defendant) Feb. 27,
1970
FACTS:
a.) September 7, 1954, a contract was entered into between the plaintiff on the one
hand and the defendant-appelle, Ligaya Javier.
b.) Plaintiff agreed to sell parcel of land (Lot no. 28,block no. 356,PSD 30328), Sta.
Mesa heights subd. for the total sum of P3,691.20, with interest at ten(10) percentum a
year, payable in P896.12 upon execution of contract and P43.92 every month for the
period of ten(10)years.
c.) Upon the execution of the contract and the first payment of installment of P396.12,
the defendant was placed in possession of the land. Thereafter she paid the stipulated
monthly installment aggregated P1,134.08.
d.) She defaulted in the payment of the said installment.
e.) May 22, 1964, Plaintiff informed the defendant that their contract had been
rescinded.Defendant refuse to vacate said land.
f.) July 9, 1964, plaintiff commenced the present action against her in CFI of Rizal,
prayed that the contract be declared validly rescinded.
g.) From January 5, 1962, defendant admitting that she had defaulted in payment of
the stipulated monthly installments but was due to the unforeseen circumstances that
she is willing to pay the arrears in installment under the contract.
h.) In the appeal, the judgment rendered in favor of the defendant declaring that the
contract to sell has not yet been rescinded, ordering the defendant to pay the plaintiff
within 60 days from receipt payment in arrears together with 10% interest per annum
from Jan. 5, 1962 and attorney’s fee of P1000.00 and the cost of the suit.
ISSUE:
Whether or not the plaintiff is reasonable to rescind the contract upon the default of
the payment as stipulated by the defendant.
HELD;
No, We find the plaintiff herein has not been denied substantial justice in according to
art. 1234 that trial court sentenced the defendant to pay all such installments overdue
including the stipulated interest apart from reasonable attorneys fees and the cost;
plaintiff will thereby recover everything due thereto pursuant to its contract with
defendant, including such damages as the former may suffered consequences of the
latter’s default. The decision appealed from may be upheld upon the authority of
Article 1234 of civil code.
The decision of C.F.I. is affirmed.
Article 1235
Kung tinanggap ng nangutang ang kakayahan at may kaalaman na ito ay may

kakulangan o iregularidad, at walang nagpapahayag ng pagtutol o protesta, ang
obligasyon ay ipinalalagay na nasunod.
Article 1236
Ang nagpapautang ay hindi kabilang o nasasakop ng pagtanggap ng pagbabayad ng

ikatlong tao na walang kinalaman o interes sa kaganapan ng obligasyon, maliban kung
mayroong kasunduan sa isang banda.
Ang sinumang nagbayad para sa iba ay maaaring makapaningil sa nangutang ng

kanyang binayaran, maliban na kung siya ay magbayad ng hindi alam at hindi ayon sa
kagustuhan ng nagpautang, mababawi o masisingil lamang niya ito kung ang
pagbabayad ay may kapakinabangan sa inutang.
CASE. DIONE
FLORENTINA DE GUZMAN, as administratrix of the intestate estate of the
deceased Santiago Lucero,plaintiff-appellee,
vs.
ANASTACIO R. SANTOS, defendant-appellant.
FACTS: On October 28, 1924, Jerry O. Toole, Antonio K. Abad and Anastacio R.
Santos, the defendant, formed a general mercantile partnership under the style
Philippine-American Construction Company, with a capital of P14,000, P10,000 of
which were taken by way of loan from Paulino Candelaria.
Upon filing of the complaint in civil case No. 3838, Paulino Candeleria obtained a
writ of attachment against the then defendants by virtue of which the sheriff attached
properties of Jerry O. Toole valued at P50; of Antonio K. Abad valued at P12,150;
and of Anastacio R. Santos valued at P2,733.
The Philippine-American Construction Company moved for the discharge of the

attached properties and offered to post a bond for P10,000. The court granted the
motion and fixed the bond at the amount offered. On May 29, 1925, the Philippine-
American Construction Company, as principal, then represented by the partner
Antonio K. Abad, and Santiago Lucero and Meliton Carlos, as guarantors, executed a
bond for P10,000 in favor of Paulino Candelaria for the lifting of the attachment under
section 440 of the Code of Civil Procedure.
In the bond thus executed, the defendant Anastacio R. Santos neither intervened nor
signed individually, but Abad testified that the former was the one who induced him
to get the signature of Lucero by taking advantage of his good relations with him.
Paulino Candelaria moved for the issuance of a writ of execution against the
guarantors of the defendants. The court granted the motion and issued a writ of
execution against the plaintiff, as judicial administratrix of the deceased Santiago
Lucero, and the other guarantor Meliton Carlos. The plaintiff was compelled to pay to
said creditor the sum of P5,565.55, the co-guarantor Meliton Carlos also paid upon the
bond signed by him the sum of P5,135. It thus appears that the payment made by the
plaintiff to Candelaria was reduced to the sum of P3,665.55. The plaintiff, in her said
capacity, demanded of the defendant Anastacio R. Santos the return of the aforesaid
sum and, but the latter refused.
ISSUES: Is the appellant bound to pay what the plaintiff had advanced to the creditor
upon the judgment?
HELD: Yes. The appellant is legally bound to pay what the plaintiff had advanced to
the creditor upon the judgment, notwithstanding the fact that the bond had given
without his knowledge.
Article 1158 provides that “payment may be made by any person, whether he has an
interest in the performance of the obligation or not, and whether the payment is
known and approved by the debtor or whether he is unaware of it. Any person who
makes a payment for the account of another may recover from the debtor the amount
of the payment, unless it was made against the express will of the latter. In the latter
case she can only recover from the appellant in so far as the payment has been
beneficial to the latter.” According to this legal provision, it is evident that the
plaintiff-appellant is bound to pay to the appellee what the latter had advanced to the
creditor upon the judgment, and this is the more so because it appears that although
Lucero executed the bond without his knowledge, nevertheless he did not object
thereto or repudiate the same at any time.
Article 1237
Sinuman magbayad sa ngalan ng umutang ng hindi nito alam o hindi ayon sa kanyang
kagustuhan, hindi mapipilit ang nagpautang upang mapalitan sya sa kanyang mga
karapatan, tulad ng mga bagay mula sa pagkasanla, garantiya o multa.

Consequences of Payment Made By A Third Person Without The Knowledge or
Against The Will of The Debtor
1. He can only recover the payment that is beneficial to the debtor.
2. He cannot place himself to have all the rights pertaining to the debtor.
Article 1238
Ang pagbayad na ginawa ng ikatlong tao na walang intensiyon na singilin ito ng

nagpautang ay ipinapalagay na isang donasyon, na kinakailangan ng pahintulot ng
nangutang. Ngunit ang bayad sa anumang kalagayan ay balido kagaya ng nagpautang
na tumanggap nito.
Article 1239
Sa obligasyon ng pagbibigay, ang pagbabayad na ginawa ng isang tao na walang

kalayaan sa pagbabayad ng bagay na may palugit, at may kakayahan na guluhin ito ay
walang bisa ng walang pagkiling sa probisyon ng artikulo 1427 na sumasailalim sa
titulo ng Natural na Obligasyon.
ILLUSTRATION
A whose age is between 18 – 21 decided to change the tire of his father’s car without
consent of the latter, but said decision of A cannot be recovered by his father because
of A’s act was done in good faith(Art 1427). But the said Article was repealed by
Article 236 of Family code and illustrated as:
A’s(at the age of 18-21) decision to change the tire of his father’s car is free to deal
even without the consent of the parents or guardian of A except for marriage.
Article 1240
Ang pagbabayad ay dapat na gawin sa isang tao na sangayon sa obligasyon na

natatag, o ng kanyang tagapagmana o sinu mang tao na may kapahintulutan na
tanggapin ito.
Article 1241
Ang pagbabayad sa isang tao na walang kakayahan na mamahala sa kanyang ari-arian

ay ipinagpapalagay na balido kung napapanatili niyang naisasakatuparan ito, o sa
kalagayan na ang pagbabayad ay kapakinabangan sa kanya.
Ang pagbabayad sa ikatlong tao ay ipinagpapalagay na tama o mabuti kung ito ay

makakadagdag sa kapakinabangan ng nagpautang. Ang benepisyo sa nagpautang ay
hindi na kailangang patunayan sa mga sumusunod na kalagayan:
1. Kung matapos makapagbayad, ang ikatlong tao ay nagkaroon ng karapatan ng isang

nagpapautang;
2. Kung pinagtibay ng nagpautang ang pagbabayad sa ikatlong tao;
3. Kung sa ginawa ng nagpautang, na ang nangutang ay napaniwala na ang ikatlong

tao ay may kapahintulutan ng tanggapinang pagbabayad.
CASE DIGESTED BY DIONE

PANGANIBAN vs. CUEVAS 7 Phil. 477
FACTS: Panganiban sold a parcel of land to Gonzales in 1897 with a right to
repurchase. Subsequently, the land was attached by the revolutionary government. For
the reason that he failed to find Gonzales because of war, Panganiban paid the
repurchased price instead to the revolutionary government in good faith. Gonzales
however, sold the land to Cuevas. Panganiban brought an action to recover the land
from Cuevas the purchaser.
ISSUES: If Panganiban is released him from his obligation by virtue of payment.
HELD: Payment of the repurchase price to the revolutionary government was not a
valid payment because the said government merely attached the property which
attachment merely prohibited its alienation. Such payment, therefore did not released
him from his obligation. Since the defendant did not pay the additional P200.00 in the
manner agreed upon in the contract and did not make a consignation in a manner
provided by law, the right of the plaintiff to redeem still exists, and he may repurchase
the property upon paying to the defendant the repurchase price.
Article 1242
Ang pagbabayad na ginawa na may mabuting katapatan sa sinumang tao na may

pagkakautang ay dapat bigyang laya ang nangutang.

Case: Panganiban v. Cuevas (G. R. No. L-2001),
February 14, 1907

PETITIONER: Salvador Panganiban
RESPONDENT: Agustin Cuevas
PONENTE: Carson, J.
This is case is an action to recover filed by Panganiban, the original owner to

Cuevas, the buyer of the parcel of land.
The first agreement was between Panganiban and Gonzales. He sold his land to
Gonzales but because of war he failed to find him. Panganiban decided to attached
said land to the revolutionary government. However, Gonzales sold the land to
Cuevas. Now, Cuevas being the owner wanted to recover the land to him.
FACTS
ISSUE/S Whether or not action filed by Panganiban is proper?
Article 1242. Payment made in good faith to any person in possession of the credit shall
LAWS release the debtor.
No. Agreement between Panganiban and the revolutionary government was invalid because
it is prohibited. There being no evidence of anything except the consignation and the
plaintiff Panganiban not being neither absent nor incapacitated so that the consignation
alone could have produce the effect of releasing the debtor, it follows that the consignation
made by Cuevas did not produce the effect which would it have been produce had it been
made as provide in the civil code. The revolutionary government was not the legal owner of
HOLDINGS it. Panganiban can only redeem the parcel of land by paying Cuevas.
Article 1243
Ang pagbabayad sa nagpautang ng nangutang matapos na atasan ng hukuman ang

nangutang na panatilihin ang utang ay walan bisa.
Article 1244
Ang nangutang ng isang bagay ay hindi maaring pilitin ang nagpautang na tanggapin
ang naiibang bagay, bagaman ito ay may kaparehong halaga, o mas higit pa sa halaga
ng dapat na masingil.
Ang obligasyon na dapat gawin at hindi dapat gawin, ang gawang mahinahon ay hindi
maaring mapalitan ng panibagong gawang mahinahon laban sa kalooban ng
nangutang.
ILLUSTRATION
A owes BMX bike to B, since the stipulated time is due, A cannot find the same brand
of BMX bike to replace the B’s choice as A owe to latter, since A has the mountain
bike much costly than BMX bike of B, the latter cannot be forced to accept by A’s
offer of mountain bike.
Article 1245
Ang pagbabago sa pagbabayad, na kung saan ang pagaari ay nailipat sa nagpautang

upang matugunan ang nautang na salapi, ay dapat na mapamahalaan ayon sa batas ng
bentahan.
Article 1246
Kapag ang obligasyon ay napapaloob sa paghahatid ng hindi tiyak na bagay, na kung

saan ang kalidad at mga pangyayari ay hindi nakasaad, ang nagpautang ay hindi
maaaring maningil ng mas mataas na kalidad, o ang nangutang man ay hindi dapat
maghatid ng mas mababa sa dapat na maihatid.
Ang layunin ng obligasyon at iba pang pangyayari ay dapat na ipagpapalagay.
Article 1247
Maliban na ito ay napagkasunduan, ang mga gastusin na hindi sakop ng hukuman na

kinakailangan sa pagbabayad ay dapat na nasa talaan ng nangutang. Yaong mga
halaga na pang hukuman, ang pamantayan ng hukuman ang dapat na mamahala.

Who Bears The Extrajudicial Expenses Attendant To The Payment?
Expenses outside the court shall be bear by the debtor because he is the one benefited
in the obligation. Creditors always benefited during transactions, they are who always
do service or do not do the service.
Article 1248
Maliban na hayagang kasunduan, ang nagpautang ay hindi pwedeng pilitin na
tanggapin ang kalakaran na bumubuo sa obligasyon. Ni hindi rin maaring atasan ang
nangutang upang magbayad ng bahagi lamang.
Gayun pa man, kapag ang utang ay bahagyang nabayaran at sa bahaging hindi

nababayaran, ang nagpautang ay maaaring maningil at ang nangutang ay maaaring
magbayad ng hindi na hihintayin pa ang paniningil ng nagpautang.
Case Digest by Jaime Robillon

Case: ASJ Corp. v Efren & Maura Evangelista (JNR)545 Scra 300 Feb 2008
FACTS PETITIONER: Antonio San JuanRESPONDENT: Efren & Maura Evangelista
PONENTE:
In 1991 Respondents delivered to petitioner various quantity of egee at ang agreed

hatching service price at .80 per egg whether successfully hatched or not. Every
delivery was recorded by “Setting Report” number of egg and date dilvered and laid
out in the incubator. Initially the service fess was paid upon release of the chick as
business went longer delayed in payment were tolerated by San Juan, just carried
over to the next delivery out of good will.
From Jan to Feb 3, 1993 Evangelista delivered a total of 101, 350 ege already on
Feb 3, Efren went to the Hatchery to pick up chick chicks covered by setting no.
108 with 32, 566 eggs but San Juan refused to release due their failure to pay the
previous hatchery from setting No. 90 to the last setting, but San Juan accepted the
10,245 egg covered by setting No. 113 and a partial payment of 15,000
Feb 10, 1993 Efren return agia to the hatchery to pick up chick under setting 109,
San Juan refused to release chicks unless Evangelsista pay his outstanding balance,
in the afternoon same day Maura, Efren wife went to San Juan to give 15,000 and
tried to get a chicks she told san juan she was hospitalized hence not able to pay the
balance, the 15,000 was accepted and told Maura to pay the outstanding so they can
get the chicks. Maura believing the egg delivered was enough to pay the balance she
promised to pay only upon proper accounting by San Juan.
Feb 11, Evangelista send their helper to pick up chicks and to ascertain if San Juan
had fully accounted already but San Jaun stood firmed not to release chicks until
they fully paid. For fear of San juan treaths , evenglista never went back to the
hatchery, they first tried to settle differences with the help of town police chief but
failed, Evagelista went to RTC to seek damages for retaining their chicks.
The RTC in July 1996 rules in favor of Evangelista and found; (1) Setting No 107
respondent owed 102, 336.80 to San juan;(2) San Juan withheld chicks under setting
No. 108 to 113;(3) The retention of chick was accompanied by threats &
intimidation;(4) San Juan was liable in solidary with ASJ Corp to pay actual
damages of 529, 644.80 and 100.000.00 for moral damages and to pay atty fees of
50,000.
Both parties appealed, Evangelista asked CA for additional award of 76,139.10

actual damages and for the unreturned by products and 1, 727, 687.52 as the
unrealized profits . On the other hand San Juan Appealed to CA for the reversal of
the RTC ruling. The Court of appeals denied both appeals and affirmed RTC ruling
with modification it added exemplary damages for Evangelista of 10,000, and it said
that, San Juan and ASJ are one and there was no bonafide intention to treat the ASJ
as separate and distinct from san Juan couples.
Whether the detention of chicks was proper and to hold petitioner San Juan solidarily liable
ISSUE/S to pay the 529,644.80 damages
Article 1248 Unless there is an express stipulation to that effect, the creditor cannot be
compelled partially to receive prestation in which the obligation consist, neither may the
debtor be required to make a partial payment s.However, when the debt is in part liquidated
and in part unliquidated, the creditor may demand and the debtor may effect the payment
LAWS of the former without waiting for the liquidation of the latter.
HOLDINGS 1. Yes, the retention of the chicks was unjustified the delayed of payment was tolerated by
them.2. There was violation to their reciprocal obligation.
3. From the moment one of the parties fulfill his obligation, delay by the other party
begins.
4. Petitioner must pay damages amounting to 408, 852.10 not 529,644.80 awarded
by RTC and to pay moral damage of 100,000, exemplary damages of 10,000 and
50,000 attys fees.
5. Only error of law are receivable by the court , the trial court have opportunity to
observed and analyze demeanor of the witnesses.
Article 1249
Ang kabayaran ng utang sa salapi ay dapat ganapin sa umiiral na pananalapi ayon sa

napagkasunduan, at kung ito ay hindi mangyayari na maihatid sa umiiral na salaping
napagkasunduan, Ang salaping umiiral na pambayad utang sa Pilipinas ang gagamitin.
Ang pagtupad ng pampangakong tala na maaaring pambayad utang, o kalakalang

pampalitan o iba pang pangmerkadong dokumento, ay makakalikha lamang ng epekto
ng pagbabayad kung ang mga ito ay naipalit ng salapi, o kung sa kasalanan o
pagkakamali ng nagpautang ang mga yaon ay nabalewala.
ILLUSTRATION case digest by Allan Pailan
Jan. 31, 1964
Paz P. Arrieta and Vitalino Arrieta – (Plaintiff-Appellees) vs.
National Rice & Corn Corporation-(Defendant-Appelant)
FACTS:
a.) May 19, 1952, plaintiff-appelle participated in the public bidding called by NARIC
for the supply of 20,000 metric tons of burmese rice. As he bid of $203.00 per nut she
was awarded, the contract was the same CIF Manila.
b.) Defendant corporation committed itself to pay for the imported rice by means of
an irrevocable, confirmed and assignable letter of credit to PNB.
d.) August 4, 1952 PNB approve a letter of credit for P3,614,000.00 upon
presentment with condition that marginal cash deposit.
e.) August 2, 1952, confessed to the appelle its dilemma; informing those letter the
plaintiffs-appelles, that NRIC are not in position to meet the deposit of 50% of
$3,614,000.00.
f.) September 8, 1952 applied was opened, delayed after August 4, 1952.
g.) As a result of delay, supplier in Rangoon was canceled and the 5% deposit
amounting to 524,000 kyats or approx P200,000.00 was forfeited. August 4, 1952 as a
deadline for the remittance of the required letter of credit.
h.) The appelle demanding compensation for the damages caused her in the sum of
$286,000.00 U.S. currency realizing unrealized profit. The demand have been rejected
is now on appeal.
ISSUE:
Whether or not that NRIC cannot be denied its fault.
HELD:
Yes, In the premises however a minor modification must be affected in the dis
positive portion of the decision appeal from
insofar as to the express the amount of damage in U.S. currency and not in the Phil.
peso R.A. 529 specifically requires the discharge of obligations only in any coin or
currency which at the time of the payment is legal tender for public & private debts.
In view of that law, therefore, the award should be converted into & expressed in Phil.
peso( at the rate of exchange at the time of judgment)
The decision appealed is hereby affirmed with modification that the award should be
converted into Phil. peso at the rate of exchange at the time of obligation was incurred
July 1, 1952.
Article 1250
Sa kalagayan ng hindi pangkaraniwang paglaki o pagliit ng halaga sa umiiral na
napagkasunduang pananalapi ang masusunod, ang halaga ng umiiral na pananalapi sa
panahaon ng pagkakatatag ng obligasyon ang dapat maging basehan ng pagbabayad ,
maliban kung ito ay napagkasunduan na.
Article 1251
Ang pagbabayaran ay dapat ganapin sa itinakdang lugar ayon sa obligasyon.
Kapag walang hayagan na kasunduan, at kung ang kasunduan na maihatid ang tiyak
na bagay, ang pagbabayad ay dapat ganapin kung saan ang obligasyon ay naitatag.
Sa ibang kalagayan, ang lugar ng bayaran ay dapat sa permanenteng lugar tirahan ng

nangutang.
Kung ang nangutang ay lumipat ng permanenteng tirahan na may masamang

intensiyon o matapos sadyain ang pagkaantala, ang mga karagdagang gastusin ay
kanyang sasagutin.
Ang mga probisyon na ito ay walang kinalaman sa ilalim ng panghukumang

pamantayan.
CASE. DIONE
AGUSTIN ASENCIO, plaintiff-appellant,
vs.
FRANCISCO GUTIERREZ, defendant-appellee.
FACTS: This action has been instituted with the object of collecting rent at the rate of
150 pesos per month from May 1, 1899, to the same month in 1900.
ISSUES: Should the case be decided at Iloilo, where it originated, or at Manila?
HELD: It was not stipulated in this letter where the payment should be made. In
accordance with article 1574 of the Civil Code, article 1171 of the same Code is
applicable, and the place of residence of the debtor is the place of payment
SUBSECTION 1: APPLICATION OF
PAYMENTS
Article 1252
JANUARY 28, 2015 / BONG REYES
Ang sino mang may utang ng may kaparehong pabor tulad ng isa din na umutang sa
nagpapautang, ay maaaring magdeklara ng panahon kung kailan sya magbabayad
katulad ng sa isa din na umutang. Maliban kung ito’y napagkasunduan, o ang
aplikasyon ng pagbabayad ay ginawa ng partido kung saan mas makikinabangan sa
termino ang sinang-ayunan, ang aplikasyon ay hindi dapat na gawin kapag wala pa sa
panahon ng pagbabayad.
Kapag ang umutang ay tumanggap mula sa kanyang pinagkakautangan ng resibo

bilang aplikasyon sa kanyang pagbabayad na ginawa, ang isa ay hindi maaring
magreklamo tulad ng isa, maliban na lamang kung ito ang naging sanhi upang
mawalan ng bisa ang kontrata.

Case: Powell v. CA (G. R. No. 331339),
December 27, 1929

PETITIONER: Thos N. Powell
RESPONDENT: Philippine National Bank
PONENTE:
This is case was filed by Thos N. Powell for specific performance against the
Philippine National Bank with regards to his loan for fertilizers. Powell complains
that the sugar cane that was planted on the land were in questioned because of the
purchased made by Severino Aldeguer. That the proper time for the designation of
his debts must be executed at the moment of payment.
FACTS
ISSUE/S Whether or not there are errors committed by the lower court in its decision?
Article 1252. He who has various debts of the same kind in favor of one and the same
creditor, may declare the time of making the payment, to which one of them the same must
applied. Unless the parties so stipulate, or when the application of payment is made by the
party whose benefit the term has been constituted, application shall not be made as to debts
which are not yet due. If the debtor accepts from the creditor the receipt in which
application of payment is made, the former cannot complain of the same, unless there is a
LAWS cause for invalidating the contract. (1172a)
None, there were no errors based on the pieces of evidence presented by the plaintiff. There
is a proper time for the designation of the debt. It must be made at the moment of the
payment. The decision of the lower court ordering the PNB to pay the sum of P7 926.18 to
HOLDINGS the plaintiff was correct. Affirmed.
Article 1253
Kapag ang utang ay nagkaroon na ng tubo, ang kabayaran ng puhunan ay dapat na

hindi tanggapin hanggang ang tubo ay hindi kasama.
Case: Magdalena State v Antonio& Herminia Rodriguez (JNR)18 Scra 967 Dec 17, 1966
FACTS PETITIONER: Magdalena StateRESPONDENT: Antonio & Herminia Rodriguez
PONENTE:
Antonio & Herminia bought 2,191 SQM lot in Quezon City from Magdalena State.
In view of the unpaid balance of 5,000 on account of purchase price, they executed
promissory note for 5,000 which promised to pay with out any demand and with
interest of 9 % that payment be made within 60 days from Jan 1957.
On the same day, Antonio & Herminia executed also a bond on favor of Magdalena
State which embodied bonding company Luzon Surety Company to pay the 5,000
balance to Magdalena, but the bonding company be notified in writing within 10
days from the moment there was default otherwise the undertaking become null and
viod.
June 1957 the obligation becomes due and demandable the surety company paid
Madalena State the 5,000, shortly thereafter, Magdalena demanded payment of
6.55.89 for accumulated interest on principal which was refused, therefore sued
respondent with MTC to enforced collection, the MTC rules in favor of the
Magdalena. MTC ordered Rodriguez and Luzon Surety to pay jointly not contented
went to CFI and the CFI rules that it waived or condoned the interest due based on
Art 1235 and Art 1253.
Whether Magdalena State was entitle to penalty after the bonding company paid the entire
ISSUE/S amount timely.
Article 1253 If the debt produces interests, payment of the principal shall not be deemed to
LAWS have been made until the interest have been covered.
1. It affirmed the CA ruling that, when there is no agreement that the first debtor shall have
been released from responsibilities does not constitute Novation and the creditor can still
enforce the obligation against the original debtor.2. The surety company is not a new and
separate contract but an accessory of the promissory note.
3. Obligation to ay sum of money is not novated in a new instrument wherein the

old is ratified by changing the terms of payments and adding other obligations not
incompatible with the old one.
4. In Novation, presumption is never favored to be sustained, it needs to be

established that the old and the new contract ,s are incompatible in all point or that
the will to novate appears by express agreement of the parties.
HOLDINGS
Article 1254
Kapag ang kabayaran ay hindi naaayon sa mga kasunduan sa mga naunang artikulo, o
kapag ang aplikasyon nito ay di maaaring tanggapin dahil sa ibang kondisyon, ang
utang na pinakamalaki sa lahat na kailangan ng bayaran ang dapat n unahin bayaran.
Illustrative Case digest by Allan Pailan
June 1, 1906
Juan Sanz y Sanz- plaintiff-appellant
vs.
Vicente Lavin & Brothers – Defendants-Appelles
FACTS:
a.) March 31, 1885, which Paulino lavin , the ancestor acknowledges the indebtedness
with the late Vicente Milla whom the plaintiff claims the sum of 18,000 pesos to pay
at the rate of 2,000 pesos per anum if failed to pay from the date of commencement
which 10% per anum from the date of breach.
b.) The court below in its decision deals solely with the “old account” & disregarded
entirely refers to the “new account” 18,000 secured by mortgage of property(real)
whether or not this amount had been paid.The decision was that it had been more than
paid & therefore dismissed, plaintiff complained and directed that the mortgage & the
registration of same in the registry of deeds be canceled.
c.) Appellant says that the former sum included both account (33,000), says that
interest alone since 1890, when stipulated yearly payments due, more than 10,000 is
due which added to the amount acknowledge to be due.
d.) The evidence presented shows payment by defendant of 1,807.95 pesos, a large
(amount)part of the payment corresponding to 1886 has been made. The only
payments shown by the defendants is 1,346 .35 pesos.
e.) Payment due in 1887 to have been made is 1,679.46 pesos, 1888 payments
2,048.78, 1889 payment of 2,200 pesos. All payments in total of 9,082.54 pesos and
the end of the year indebtedness was reduce to 8,917.46 pesos.
f.) From December 29, 1891 to July 1, 1894 payments made by Lavin, 2,734.44
accepted by the plaintiff.
g.) It appears that one of the mortgage was sold by the plaintiff at public auction on
August 14, 1893 the sum of 5,500 pesos to Miguel Ortiz, February 27, 1894 and sold
it the same amount to Sevillo Robles. (exhibit A,B, & D), This sum must be deducted
from balance indebtedness in 1889.
h.) Paid by Paulino Lavin 9,683.54, by Minors Lavin 5,500, by Vicente Lavin
2,737.44, total of 17,920.98 and balance only 79.02 pesos.
ISSUE:
Whether or not that the appellant is free from the obligation as demanded by the
plaintiff for imdemnity in conclussion base on the evidence presented.
HELD:
Yes, it appears evident from numerous statement of the appellant that in the amount
sued for is included, although without determining the exact amount of the principle,
stipulated interest in addition to the legal interest from the date of complained. The
plaintiff waived his right to collect interest from heir Paulino Lavin from 1885 to
march 1894. There does not appear to have been mora ex re, and although it is true
there does appear to have been demands for the payment on the part of creditor, there
appear to have been demands made after the extension of the time requested by the
debtors and accepted by the creditor.
The judgment of trial court is affirmed.
SUBSECTION 2: PAYMENT BY
CESSION
Article 1255
Ang may utang ay maaaring magsuko o magtalaga ng kanyang pag-aari sa kanyang

inutangan bilang kabayaran sa kanyang mga utang. Sa ganitong usapan, maliban kung
mayroong sasalungat sa pinagkasunduan, magiging malaya lamang sa kanyang mga
responsibilidad ang umutang kung mapupunta sa kanyang pinagkakautangan ang
halaga ng bagay na kanyang itinalaga. Sa ganitong kasunduan, ano mang maging
epekto ng usapang ito, ay kailangang gawin sa pagitan ng umutang at nagpautang at
dapat na sumailalim sa mga espesyal na batas.

Article 1179: Section 1: Pure & Conditional Obligations

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Article 1179: Section 1: Pure & Conditional Obligations

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SECTION 1: PURE & CONDITIONAL

Bawat obligasyon na naglalaman ng isang resolutory kundisyon ay dapat ding

Illustrative case digests by Allan Pailan

Levy Hermanos – plaintiffs-appelles

Pedro Paterno -Defendant- Appellant

The supreme court affirmed the judgment of trial court.

Sa conditional obligation, ang pagtatamo ng karapatan, pati na rin ang pagtapos o

Case Digest by Ainna Fathi

PETITIONER: Emilio Natividad

RESPONDENT: Basilia Gabino

The original clause 6 was:

ISSUE/S Whether the CFI erred in interpreting clause 6 of the testament

Resolutory Condition/Condition Subsequent: A condition that extinguishes

A “but, if” condition:

e.g #2: propter nuptias

e.g #3: reserva troncal

Ang mga imposibleng kondisyon, na labag sa magandang kaugalian o patakarang

Ang kondisyon na hindi gumawa ng isang imposibleng bagay ay itinuturing na hindi

DISCUSSION BY BONG REYES

Examples of impossible conditions are:

1. I will give you money as a loan if its snow in the Philippines.

Examples of impossible conditions contrary to good morals and customs.

Ang kondisyon na may nangyaring kaganapan sa isang tukoy na oras ay dapat

Kung walang oras na nakasaad, ang kundisyon ay dapat itinuturing na natupad sa

Ang kundisyon ay dapat itinuturing na naisakatuparan na kapag ang nagpautang ay

Illustrative case by Allan Pailan

Uy Tieng Piao & Tan Liuan (Defendant-Appellant)

Ang apekto ng isang maykondisyon obligasyon magbigay, kapag kondisyon ay

Sa obligasyon na gumawa at ng hindi pag gawa, ang hukoman ang magpapasiya ng

Ang nagpapautang ay maari, mbago matupad ang kundisyon, ay gumawa ng nauukol

Jacinto v De Leon 51 Phil. 992

CASE DIGEST BY BONG REYES

Kung ang kasunduan ay naIpatupad na,at may layunin na ipagpaliban ang

Ayon naman sa obligasyon gumawa o hindi gumawa, ang probisyon ng ikalawang

Pag puna: walang kasong halimbawa.

Ang artikulong ito ay magagamit sa mga usapan may resolutory at suspensive na

Resoluroty, ay kundisyon kung saan ang usapan ay magkakabisa lamang sa oras na

Suspensive, ay kudisyon kung saan na sa oras na ang itinakdang kundisyon ay

Ang kapangyarihan na pawalan bisa ang obligasyon ay tuwiran sa isang palitan

Ang naapi ay pipili sa pagitan ng pagsasakatuparan o . ipawalang saysay ang

Ito ay nauunawaan na walang makakasama sa mga karapatan ng taong walang

Kapag ang parehong partido ay nagkasala sa hindi pagtupad sa anumang obligasyon,

Illustrative case by Allan Pailan

C.A. & Supicio M. Tolentino – respondent

CA decision is modified , Sulficio Tolentino is ordered to pay the petitioner , and in

SECTION 2: OBLIGATIONS WITH A

Obligasyon na mayroon hinihintay na panahon ay maybisa kaagad, ngunit mawawala

Case: Ernest Berg v. Magdalena Estate, Inc. (92 PHIL. 110),

FACTS PETITIONER: Ernest Berg

PONENTE: Bautista Angelo, J.

In an application to sell or dispose their properties, both parties filed for

Whether the term of payment stipulated in the defendant’s application for

A day certain is understood to be that which must necessarily come, although

the preceding Section. (1125a)

Paalala wala kaso nababanggit ang artikulong ito.

Kung kailan sa isang obligasyon may panahon na itinalaga iyon ay ipinagpapalagay

CASE DIGEST BY BONG REYES

Whether or not Abesamis is liable to pay of the loss?

Kapag ang obligasyon ay hindi nagtalaga ng tiyak na panahon, subalit mula sa

Ang mangungutang ay mawawalan ng karapatan gamitin ang panahon sa mga

1. Kung pagkatapos ng obligasyon ay napagkasunduan na, siya ay naging dukha,

2. kung hindi niya nagbigay sa kanyang pinagkakautangan ng guaranita o pangtubos