NATURE AND EFFECT OF

OBLIGATIONS
Article 1163
Every person obliged to give something is also
obliged to take care of it with the proper
diligence of a good father of a family, unless the
law or the stipulation of the parties requires
another standard of care.
Determinate and Generic Thing
An obligation to give consists of the delivery of a thing which may be
determinate or generic.

• A determinate thing is one which is particularly designated or

physically segregated from all other class.
For Example: Toyota Car with Plate No. 2222, “my only diamond ring”

• A generic thing or indeterminate thing is one that refers to a class or

genus without distinguished from others of same class.
Example: a car, a horse, P1,000,
Diligence Needed:
• Diligence of a good father of a family means the diligence which an
ordinary prudent man would exercise with regard to his own property.
Example:
Under a contract executed by D and C on September 1, D obliged
himself to deliver a specific second hand car to C on September 20. Before,
delivery, D must regularly warm up the engine of the car, check its oil and
other fluids, see to it that it is parked at a safe area and do other acts which
an ordinary owner would do to preserve it.

• Extraordinary Diligence
“ A common carrier is bound to carry the passengers safely as far as
human care and foresight can provide, using the utmost diligence of very
cautious persons, with a due regard for all the circumstances.”
Effect of failure to observe the diligence
required.

The debtor who fails to observe diligence

required in the preservation of the thing shall be
liable for the payment of damages, unless such
failure is due to a fortuitous events.
Concept of delivery
– Delivery means placing the object in the control
and possession of the creditor, either physically or
constructively, such as by execution of a public
instrument or by giving the key of the place or
deposit where a movable is kept.
 CASE APPLICATION:
G.R. No. L-6913 , November 21, 1913
THE ROMAN CATHOLIC BISHOP OF JARO vs. GREGORIO DE LA PEÑA
FACTS:
In 1898 Fr. De la Peña assigned as trustee of the sum of P6,641, collected by
him for the charitable purposes he deposited in his personal account P19,000 in the
Hongkong and Shanghai Bank at Iloilo. During the war of the revolution, Father De la
Peña was arrested by the military authorities as a political prisoner. The arrest of
Father De la Peña and the confiscation of the funds in the bank were the result of the
claim of the military authorities that he was an insurgent and that the funds
deposited had been collected by him is for revolutionary purposes. The money was
taken from the bank by the military authorities by virtue of such order, was
confiscated and turned over to the Government.

ISSUES: Whether or not Father De la Peña is liable for the loss of the funds?
RULLING:
No, he is not liable because there is no negligent act on the part of Fr.
De la Peña. It was so happened that during that time the money was
taken from him by the U.S. military forces which is unforeseen event.
Although the Civil Code states that “a person obliged to give something
is also bound to preserve it with the diligence pertaining to a good
father of a family”, it also provides, following the principle of the
Roman law that “no one shall be liable for events which could not be
foreseen, or which having been foreseen were inevitable, with the
exception of the cases expressly mentioned in the law or those in
which the obligation so declares.”
Article 1164
The creditor has a right to the fruits of the
thing from the time the obligation to deliver it
arises. However, he shall acquire no real right
over it until the same has been delivered to him.
Kinds of fruits
• Natural Fruits – spontaneous products of the sold and the young
and other products of animals. ( Trees and plants that grows
without human intervention)

• Industrial Fruits – Industrial fruits are produced by land of any kind

through cultivation or labor. (rice, corn, et.)
• Civil products – Civil fruits are those which are the result of a
juridical relation such as the rents of buildings, the price of leases
of lands and other property, and the amount of perpetual or life
annuities or other similar income.
Right of the creditor to the fruits
Example:
• On September 1, 2010, D obliged himself to deliver a specific
agricultural lot to C. Since the obligation is a pure obligation, C shall
be entitled to the fruits, such as the plants that have grown on the
lot, accruing from September 1, when the contract is perfected.
Nature of the creditor’s right
Before the delivery
From the time the obligation to deliver the thing arises, the creditor acquires
the right to demand the delivery of the thing and its fruits that have accrued
from such time from the debtor. Can only be enforced only against the
debtor, is known as personal right.

After delivery
After the delivery of the thing and its fruits to him, the creditor acquires a
real right over them. A real right, also called jus in re, such as the right of
possession or ownership, is on that is enforceable against the whole world.
Can be enforced only over the thing and not the person of the debtor.
The Debtor’s Obligation to deliver arise when:
• When the obligation is based on law, quasi-delict, quasi-contract or
crime, specific provisions of the applicable law shall determine when
the delivery shall be done or affected.

• When the obligation is subject to a suspensive condition, the obligation

to deliver arises from the happening of the condition.

• When the obligation is subject to a suspensive term or period, the

obligation to deliver arises from the lapse of the term or period.

• When there is no condition or term, the obligation to deliver arises

from the constitution, creation or perfection of the obligation.
Article 1165
When what is to be delivered is a determinate things, the creditor, in
addition to the right granted him by Article 1170, may compel the
debtor to make the delivery.

If the thing is indeterminate or generic, he may ask that the

obligation be complied with at the expense of the debtor.

If the obligor delays, or has promised to deliver the same thing to two
or more persons who do not have the same interest, he shall be
responsible for fortuitous event until he has effected the delivery.
SPECIFIC OR DETERMINATE THINGS
Capable of particular designation:
a. this car
b. the car owned by A on Sept 12, 2000.
c. the car with plate number 1212
d. this particular notebook
GENERIC OR INDETERMINATE THINGS
Refers to a class, a genus, and cannot be pointed out with particular
designation.

Examples:
a. a car
b. a BMW
c. the sum of P100,000.00
d. a kilo of rice
Remedies of the creditor when the debtor fails to
perform an obligation to give (real obligation)
Obligation to deliver a determinate thing
• To compel the debtor to make the delivery
• To demand the payment of damages from the debtor.
• Rescission or cancellation (in some cases only)

Obligation to deliver a generic thing

• To ask that the obligation be complied with at the expense
of the debtor.
• To demand the payment of damages from the debtor. (in
case of failure to deliver)
FORTUITOUS EVENTS?
EVENTS THAT CANNOT BE FORESEEN, ALTHOUGH FORESEEN BUT
INEVITIBLE.
Loss due to fortuitous event of the
determinate thing
As a rule, the loss of the thing due by reason of fortuitous event
extinguish the debtor’s obligation (Art. 1174)

However, he shall be liable in the following cases:

1. If he is guilty of delay
2. If he promised to deliver the same thing to two or more persons who
do not have the same interest.
EFFECTS OF FORTUITOUS EVENTS
A SPECIFIC OBLIGATION, THAT IS AN OBLIGATION TO DELIVER A
SPECIFIC THING, AS A RULE, EXTINGUISHED BY A FORTUITOUS EVENT
OR ACT OF GOD.

GENERIC OBLIGATIONS ARE NEVER EXTINGUISHED BY FORTUITOUS

EVENTS.
EXAMPLES:

A IS OBLIGED TO GIVE B THIS CAR. BEFORE THE

DELIVERY, AN EARTHQUAKE DESTROYS
COMPLETELY THE CAR. IS THE OBLIGATION
EXTINGUISHED?
A IS OBLIGED TO GIVE B A BOOK.
BEFORE THE DELIVERY, A FIRE
DESTROY IT. IS THE OBLIGATION
EXTINGUISHED?
CASE APPLICATION
Yu Tek v. Gonzales
Facts: A obligated himself to sell for a definite price a certain specified
quantity of sugar of a given quality, without designating a particular lot.

Issue: In case the sugar is lost by a fortuitous event, who bears loss prior
to delivery, the seller or the buyer?

Held: In this case, the seller bears the loss because what was delivered
was not a specific thing, but a generic thing. And genus never perishes.
Incidentally, the sale here cannot be said to have been already perfected
because of the lack of physical segregation from the rest of the sugar
Article 1166

The obligation to give a determinate

thing includes that of delivery of all its
accessions and accessories, even though
they may not have been mentioned.
• Accession – includes everything produced by a thing, as well as all
incorporated or attached with it, may it be natural or artificial.
Accession discreta – right to the fRuits
Accession continua – includes both accession natural (i.e. alluvial
deposits) and accession industrial (i.e. those built, planted or sowed on the
land of the landowner)

• Accessories – includes things that are united or attached as ornaments to

the principal thing, for the latter’s use or perfection (i.e. spare tire of a car,
television antennas, cellphone chargers, moviehouse chairs, etc.)
• Note: Although the delivery of determinate thing includes all its accessions
and accessories, the parties in the contract may stipulate that certain
accessions or accessories may not be included in the delivery. Both parties
have the freedom to stipulate such things
Article 1167
If a person obliged to do something fails to do it, the
same shall be executed at his cost.

This same rule shall be observed if he does it in

contravention of the tenor of the obligation.
Furthermore, it may be decreed that what has been
poorly done be undone.
Remedies of the creditor in an obligation to
do (positive personal obligation)

If the debtor fails to perform the obligation

• To have the obligation be executed the expense of the debtor.

However, the debtor cannot be compelled to perform the
obligation that would constituted involuntary servitude.

• To demand payment of damages from the debtor.

CASE APPLICATION
FACTS:
A typewriter owner delivered the same to a repairman for repairs
agreed upon orally. Despite repeated demands, no work was done
thereon. Eventually the repairman returned the machine, unrepaired
and worse, several parts were missing, thus the description “cannibalized
and unrepaired”. The owner was then constrained to have the typewriter
repaired in another shop. Owner now claims damages from the first
repairman (for the cost of the repairs and the cost of the missing parts).
Defendant repairman, however, alleges that owner should have first filed
a petition for the court to fix the period within which the job of repairing
was to be finished.

ISSUES:
Can the defendant be held liable for damages?
RULING:

Yes, the defendant can be held for damages and this would include
the cost of labor and needed materials, as well as the value of the
missing parts. According to Art. 1167 – “If a person obliged to do
something fails to do it, the same shall be executed at his cost. The
same rule shall be observed if he does it in contravention to the tenor
of the obligation”.
Article 1168
When the obligation consists in not doing, and the
obligor does what has been forbidden him, it shall also
be undone at his expense.
Article 1169
Those obliged to deliver or to do something incur in delay from the time the obligee
judicially or extrajudicially demands from them the fulfillment of their obligation.
However, the demand by the creditor shall not be necessary in order that
delay may exist:
(1) When the obligation or the law expressly so declare; or
(2) When from the nature and the circumstances of the obligation it appears
that the designation of the time when the thing is to be delivered or the service is to
be rendered was a controlling motive for the establishment of the contract; or
(3) When demand would be useless, as when the obligor has rendered it
beyond his power to perform.
In reciprocal obligations, neither party incurs in delay if the other does not comply or
is not ready to comply in a proper manner with what is incumbent upon him. From
the moment one of the parties fulfills his obligation, delay by the other begins.
Delay or default or mora is the non-fulfillment of an obligation with respect to
time.

KINDS OF DELAY
Mora solvendi – the default on the part of the debtor/obligor;
Mora accipiendi – the default on the part of the creditor/obligee;
Compensatio morae – the default on the part of both the debtor/obligor and
creditor/obligee which arises in reciprocal obligations the effect is the default of
one party neutralizes the default of the other.

WHEN THERE IS NO DEMAND, THERE IS NO DELAY

Judicial or extrajudicial demand.
REQUISITES OF DELAY
• Debtor does not perform the obligation when it is due
• creditor makes a demand upon him to perform his obligation
• Debtor does not perform the obligation despite the demand.

WHEN DEMAND IS NOT REQUIRED TO MAKE DEBTOR IN DELAY

• When the obligation expressly declares
• When the law expressly so declares
• When the designation of time was a controlling motive for the establishment of the
contract
• When demand is useless.

EFFECTS OF MORA SOLVENDI

• He shall be liable for damages
• He shall bear the risk of loss
• He shall be liable for any fortuitous event
Article 1170
Those who in the performance of their obligations are
guilty of fraud, negligence, or delay, and those who in
any manner contravene the tenor thereof, are liable
for damages.
Grounds for liability to pay damages

• Fraud
• Negligence
• Delay
• Contravention of the tenor of the obligation
Kinds of Damages
• Actual or compensatory damages- These refer to the pecuniary loss (actual
damages) that may be recovered. (Value of the loss suffered and profits not
realized)

• Moral Damages – They include physical suffering, mental anguish, fright,

serious anxiety, besmirched reputation, wounded feelings, moral shock, social
humiliation and similar injury.
• Nominal damages – Damages to vindicate or recognize a right and not for
indemnifying any loss suffered such as trespass upon real property.
• Temperate or moderate damages – They are more than nominal but less than
compensatory damages, but may be recovered if the court finds that some
pecuniary loss has been suffered but its amount cannot, from the nature of the
case be proved with certainty

• Exemplary or corrective damages – imposed by way of example or correction

for public.