University of the Cordilleras

College of Accountancy
Obligations and Contracts

Teaching and Learning Objectives:

At the end of this module, the student must be able to grasp the
following concepts:

1. The nature and effects of Obligations

2. Duties of the Obligor

Nature and effects of Obligations

OBLIGATION TO GIVE
The obligation to give (Real Obligation) may be divided into two
depending on the object to be delivered.

1. Obligation to give a Specific Thing

A thing is specific if it is particularly designated or physically
segregated from all other things of the same class [Art.1460,
CC]; Identified by individuality.

It cannot be substituted by another object without the

consent of the obligee.

Ex. Brian sold Jose a horse name Richie. The horse named
richie is specific since it is particularly segregated from other
animals of the same family, the horse. If the horse named Richie
dies before delivery to the creditor, the obligation is
extinguished because you cannot substitute a specific object
with another.

Other examples of Specific objects:

a. A dog named Bruno
b. A car with plate number AYX 123
c. The watch I gave you
d. The shoes I am wearing

2. Obligation
to give a Generic thing.
A thing is generic if Object is designated only by its class/
genus/ species.

Can be substituted by any object of the same class and

same kind. If the thing is lost or damaged, it will not affect the
 obligation because the debtor/ obligor may substitute it with
another of the same class.

Ex. An obligation to deliver 5 sacks of rice. Rice is a generic

thing.

Other examples of a generic thing:

a. A bucket of stones
b. Milk
c. Any car
d. 10 kilos of meat

DUTIES OF THE OBLIGOR

In an obligation to deliver a SPECIFIC THING

I. DUTY TO PRESERVE OR TAKE CARE OF THE THING (Art 1163, NCC)

In a real obligation, the debtor / obligor has the duty to take care of
the thing with the due diligence of a good father of a family unless the
law or stipulation of the parties requires another standard of care.

Standards of Care that the Obligor must observe

General Rule:
1. The debtor / obligor shall take care of the thing with the diligence
(care) of a good father of a family.
The diligence of a good father of a family is usually
interchanged with ordinary diligence. It is the amount of care a
person would exert towards preserving a thing as if it was his own.

Exception:
If the law provides another standard of care
Ex. In Common carriers/ public transport, the law requires
another standard of care which is Higher than diligence of a
good father of a family.

If the parties agree on a different degree of care degree of care or

diligence will be followed.

Example: Jose and Brian entered into a contract where Jose will
deliver a specific car with plate number AYZ 123 to Brian. Here, Jose
has the obligation to take care of the car before delivering it to Brian.

What standard of care should Jose Observe?

As a rule, Jose must observe the diligence of a good father of a
family or what we call ordinary diligence. He must treat the car as if it
was his.
If Jose and Brian agreed that another standard of care will be used
then that standard of care will be the one which Jose must observe.

II. DUTY TO DELIVER THE THING ITSELF (Art 1165, NCC)

In an obligation to deliver a specific thing, the primary thing that
must be delivered is the thing itself.

III. DUTY TO DELIVER THE FRUITS OF THE THING (Art 1164, NCC)
Kinds of Fruits
1. Natural Fruits - Spontaneous products of the soil, and the
young and other products of animals. Ex. Trees on land without the
intervention of humans.
2. Industrial Fruits - Those produced by lands of any kind through
cultivation or labor. Ex. Planting rice, sugar cane, etc.
3. Civil Fruits - Those derived of a juridical / legla relation. Ex.
Rent, interest in money in bank.

IV. DUTY TO DELIVER THE ACCESSIONS AND ACCESSORIES (Art 1166,

NCC)
1. Accessions - everything which is produced by a thing, or which is
incorporated or attached thereto, excluding fruits.
2. Accessories - things designed for the embellishment, use or
preservation of another thing of more importance.

V. DUTY TO PAY DAMAGES INCASE OF BREACH (Art 1170, NCC)

In case the Obligor fails to deliver the thing, he shall also have the
duty to pay damages. Damages comes in the form of money.

DUTIES OF THE DEBTOR / OBLIGOR

In an obligation to deliver a GENERIC THING

I. DUTY TO PRESERVE OR TAKE CARE OF THE THING (Art 1163, NCC)

Same as above.

II. DUTY TO DELIVER A THING OF THE QUALITY INTENDED BY THE PARTIES

(Art 1246, NCC)
If the creditor and debtor agreed to a particular quality of a
generic thing, then what must be delivered should be that quality.
The creditor / obligee cannot demand a thing of superior quality
neither can the debtor deliver a thing of inferior quality.
 Ex. Jose and Brian entered into a contract where Brian will deliver
10 sacks of Jasmine Rice to Jose. Jasmine rice is about 50 pesos per
kilo. In this case, Brian should deliver the quality of rice that they agreed
upon which is Jasmine Rice. Jose cannot demand rice of higher quality
than Jasmine Rice. Brian on the other hand, cannot deliver Rice which
is of lower quality.

III. DUTY TO PAY DAMAGES IN CASE OF BREACH (Art 1170, NCC)

DUTIES OF THE OBLIGOR

In an obligation TO DO

I. DUTY TO DO THE ACT OR SERVICE (Art. 1167, NCC)

In an obligation to do, the primary obligation of the debtor is to do
the act or service agreed upon by them.

Ex. Jose and Brian entered into a contract where Jose asked Brian
to sing in his wedding. Here, the primary duty of Brian is to sing in Jose’s
wedding.

II. DUTY TO SHOULDER THE COST OF EXECUTION IF HE FAILS TO DO IT (Art.

1167, NCC)
If the debtor/ obligor fails to do the act or service, the creditor may
be the one to do the act or service or let another person do it but at
the expense of the debtor.

Ex. Jose and Brian agreed that Jose will fix Brian’s roof. If Jose fails to
fix Brian’s roof, Brian may either do the roof himself or let another
person do it like Erwin. But in both cases, Jose will be the one to
shoulder the expenses in fixing the roof since he was the one who failed
his obligation.

III. DUTY TO UNDO WHAT WAS POORLY DONE (Art. 1167, NCC)
If the debtor / obligor does the obligation in a poor manner then he
will be liable to undo what he has done.

Ex. Brian is a house owner in Baguio. He asked Jose to paint his

walls. However after painting, the paint started to crack and peel off.
Here, since the painting was POORLY DONE, Brian may ask Jose to
undo what he painted and let him paint again or ask another person
to paint it at the expense of Jose.

IV. DUTY TO PAY DAMAGES IN CASE OF BREACH.

Disclaimer
The information provided in RFBT 1 in this module is for educational purposes only.
All information found herein is provided in good faith and we make no
representation or warranty, express or implied, as regards to the accuracy,
adequacy, validity, reliability, availability, or completeness of thereof. We do not
assume ownership of any of the information provided herein.

Sources

Civil Code of the Philippines

De Leon and De Leon Jr. (2014). The Law on Obligations and Contracts, Rex
Book Store, Manila.

Domingo (2018), Obligations and Contracts, Coaching for Results Publishing,

Itogon Benguet.