I.

Definitions

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

2. Civil loss – when a thing disappears in such a way that its existence is unknown (e.g., a particular dog
has been missing for sometime); or even if known, it cannot be recovered (Art. 1189[2].), whether as a
matter of fact (e.g., a particular ring is dropped from a ship at sea) or of law (e.g., a property is lost
through prescription). When a thing disappears I such a way that its existence is unknown or even if
known, it cannot be recovered, whether as a matter of fact or of law.

3. Reciprocal Obligations – are those which arise from the same cause and in which each party is a
debtor and creditor of the other, such that the performance of one is designed to be the equivalent and
the condition for the performance of the other. The general rule is that they are to be performed
simultaneously or at the same time such that each party may treat the fulfillment of what is incumbent
upon the other as a suspensive condition to his obligation (see Art. 1169, last par.), and its non-
fulfillment, as a tacit or implied resolutory condition, giving him the right to demand the rescission of the
contract, i.e., it may be exercised even if it is not provided in the agreement of the parties.

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

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

II. Discussions

1. Illustrate an obligation subject to:

• Suspensive condition – (condition precedent or condition antecedent) or one the fulfillment of which
will give rise to an obligation (or right). In other words, the demandability of the obligation is suspended
until the happening of a future and uncertain event which constitutes the condition.

As long as the condition has not occurred, the very existence of the obligation is not yet arising. For
example, if your rent is due on the 30th, you have an obligation to pay the rent. The performance to pay
occurs on the 30th. The performance is suspended until the 30th.

• Resolutory Condition – or one the fulfillment of which will extinguish an obligation (or right) already
existing. The happening of which extinguishes the obligation.
You have a car note over the next 10 years. Once you pay the last payment at the end of 10 years, the
obligation ends. What is the effect of the fulfillment of the condition in a conditional obligation? The
suspensive condition is when the parties agree that the duty to perform is postponed until a determined
or determinable date due to the pending event, and that this event is certain to happen. However, the
exact date is unknown. The obligation will arise when the said condition is already fulfilled. While in the
resolutory condition, when the parties agree that the obligations in the contract will be terminated upon
a certain future time. This exact time is certain to happen, but the exact date is unknown.

What is the effect of fulfillment of the condition in a conditional obligation?

• (Suspensive) A's obligation to B will arise

• (Resolutory) A's obligation to B will be extinguished

2. Give two (2) cases when the conditional obligation is valid although the condition depends entirely
upon the will of the debtor. Explain.

(1) If the obligation is a pre-existing one and does not depend for its existence upon the fulfillment of
the obligation. If the debtor already has an obligation, only the condition will be void because the
obligation's existence does not depend upon the condition's fulfillment.

(2) If the condition is resolutory, and depends upon the debtor, it is valid. It is the same as a suspensive
condition that depends upon the creditor's will.

3. May an obligor be liable under an obligation subject to a suspensive condition, who is entitled to the
fruits that accrued during the pendency of the condition once said condition is fulfilled?

Yes. If the condition is suspensive, and the obligor actually prevents the fulfillment of the condition, and
he does this voluntarily, he can be held liable. The obligor is liable because he prevented the condition
from happening to avoid his obligations.

4. In an obligation to give a parcel of land subject to a suspensive condition, who is entitled to the fruits
that accrued during the pendency of the condition once said condition is fulfilled?

The debtor is entitled to the fruits of the land unless their stipulations clearly state otherwise.

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

• Is lost with the debtor’s fault; without his fault;

Without his fault If w/ debtor's fault, creditor is entitled to demand damages plus incidental damages, if
any. If w/o debtor's fault, obligation is extinguished and debtor has no liability to the creditor.

• Deteriorates with the debtor’s fault; without his fault.

Without his fault If w/ debtor's fault, creditor may choose between rescission of obligation with
damages OR fulfillment of obligation with damages. If w/o debtor's fault, creditor will suffer the
deterioration.

III. Problems

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

- No, C cannot insist that B pay earlier because the condition is "if B wants". The obligation is void.

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

- The obligation is valid because the suspensive condition does depend upon the sole will of D.

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

- S can either demand action for specific performance (fulfillment) of the obligation with damages, OR
demand action for rescission of the obligation with damages.

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

- No. I will not grant rescission because B is willing to pay the balance and only needs more time. I will
grant B a term for performance instead.

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

(1) If D's obligation does not depend upon a future or uncertain event.

(2) If D's obligation does not depend upon a past event unknown to the parties

(3) If the obligation depends upon a resolutory condition.