Joint and Solidary Obligations

As to the number of parties, an obligation can either be an individual obligation or

a collective obligation. An individual obligation is one where there is only one (1) obligor
and one (1) obligee. A collective obligation, on the other hand, has two (2) or more
debtors and/or two (2) or more creditors. It may be joint or solidary.

  In a joint obligation, each debtor is liable only for a proportionate part of the debt,
and each creditor is entitled only to a proportionate part of the credit. Other terms which
indicate joint obligation are “proportionately”, “pro rata”, “mancomunada”, and
“mancomunada simple.”
Examples: 
(1) Jack and Jill are indebted to Jane for P100,000.00. Jack is liable only for
P50,000.00 and Jill is liable only for P50,000.00. 
(2) Mars is indebted to Venus and Earth for P100,000.00. Venus can collect only
P50,000.00 from Mars. Earth can also collect only P50,000.00.

A solidary obligation, meanwhile, is one where each one of the debtors is bound
to render, and/or each one of the creditors is entitled to demand from any of the
debtors, entire compliance with the prestation. Other terms which indicate solidarity are
“jointly and severally”, “individually and collectively”, “in solidum”, “mancomunuda
solidaria”, and “juntos o separadamente”. 
Examples:
 (1) Jack and Jill are solidarily indebted to Maine for P100,000.00. Maine can
demand the entire P100,000.00 from either Jack or Jill. If Jack pays Maine the
entire P100,000.00, the obligation is extinguished. Jack can demand
reimbursement of P50,000.00 from Jill representing the latter’s share in the debt.
This is called passive solidarity or solidarity on the part of the debtors. 
(2) Maine owes Jack and Jill, solidary creditors, P100,000.00. Either Jack and Jill
may demand P100,000.00 from Maine. If Maine pays Jack P100,000.00, the
obligation is extinguished. Jack must give Jill P50,000 representing the latter’s
share in the credit. This is called active solidarity or solidarity on the part of the
creditors.
(3) Jack and Jill, solidary debtors, owe Mike and Maine, solidary creditors,
P100,000.00. Mike or Maine may collect from Jack or Jill the total sum of
P100,000.00. If Jack pays Mike P100,000.00, the obligation is extinguished. Mike
give Maine P50,000.00. On the other hand, Jill must reimburse Jack P50,000.00.
This is called mixed solidarity or solidarity on the part of both debtors and
creditors.  

Rule if there is concurrence of two or more debtors and/or two or more creditors
in one and the same obligation
As a general rule, when there is plurality of parties, the obligation is presumed to
be joint. Solidarity exists only in the following cases:
1. When the obligation expressly so states
2. When the law requires solidarity
3. When the nature of the obligation requires solidarity. 
Existence of solidarity despite different periods and conditions (Art. 1211)
Solidarity exists although the creditors and the debtors may not be bound by the
same periods and conditions.
Example: A, B and C are solidarily liable to X for P15,000.00. The parties
stipulated that the share of A is payable on demand; the share of B on
Christmas day next year; and the share of C, if X passes the CPA
Licensure Exam. X may demand payment of A’s share of P5,000 anytime
from either A B or C. On Christmas day, X may demand B’s share of
P5,000 from either A, B or C. Once X passes the CPALE, he may demand
payment of C’s share of P5,000 from either A, B or C.

Rules between solidary parties

1. Each one of the solidary creditors may do whatever may be useful to the others,
but not anything which may be prejudicial to the latter. (Art. 1212) Hence,
suppose X, a solidary creditor renounces the whole obligation of P50,000 without
the consent of the Y, his co-creditor, the obligation will be extinguished. As a rule,
the remission, novation, compensation, or confusion made by any solidary
creditor extinguishes the whole obligation. (Art. 1215). However, X has to give
Y’s share of P25,000.00  since solidary creditor may not do anything prejudicial
to his co-solidary creditors. 
2. A solidary creditor cannot assign his rights without the consent of the others. (Art.
1213) However, this prohibition applies only to assignment to a third person. If
the assignment is without the consent of the co-creditors, the assignment is not
valid as to them. Accordingly, they can recover their respective shares from the
assigning creditor in case the assignee who collected the debt fails to give them
their shares. 
3. The debtor may pay any one of the solidary creditors; but if any demand, judicial
or extrajudicial, has been made by one of them, payment should be made to him.
(Art. 1214). Hence, if a solidary creditor (X) has previously demanded payment
but the debtor (A) did not pay him and  instead subsequently paid a co-solidary
creditor (Y), the debtor (A) can still be held liable for the share of other solidary
creditors (X) if the latter did not receive his share from Y.
4. The creditor may proceed against any one of the solidary debtors or some or all
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. (Art. 1216)
5. Payment made by one of the solidary debtors extinguishes the obligation. If two
or more solidary debtors offer to pay, the creditor may choose which offer to
accept. He who made the payment may claim from his co-debtors only the share
which corresponds to each, with the interest for the payment already made. If the
payment is made before the debt is due, no interest for the intervening period
may be demanded. When one of the solidary debtors cannot, because of his
insolvency, reimburse his share to the debtor paying the obligation, such share
shall be borne by all his co-debtors, in proportion to the debt of each. (Art. 1217)
 Example: X, Y and Z are solidarily indebted to A for P15,000. X paid the
whole amount to A. Y was able to reimburse X for his share in the debt.
However, due to insolvency, Z cannot reimburse X. Here, X and Y should
bear the share of Z which she cannot reimburse. Therefore, since the
problem is silent, X and Y would equally share in the P5,000, such that, Y
should give X an additional P2,500.00.
6. Payment by a solidary debtor shall not entitle him to reimbursement from his co-
debtors if such payment is made after the obligation has prescribed or become
illegal. (Art. 1218)
Example: A, B and C, solidary debtors, borrowed P300,000.00 from M.
The obligation is evidenced by a promissory note. If A pays M
P300,000.00 more than 10 years after the note had become due, A can no
longer demand reimbursement from B and C. Ordinarily, an obligation
evidenced by a written instrument prescribes or is extinguished after 10
years. Payment by a solidary debtor after the obligation has prescribed
does not entitle him to reimbursement. The same rule applies if payment
is made after the obligation has become illegal.     
7. The remission made by the creditor of the share which affects one of the solidary
debtors does not release the latter from his responsibility towards the co-debtors,
in case the debt had been totally paid by anyone of them before the remission
was effected. (Art. 1219)
Example: A and B are solidarily liable to C in the amount of P10,000. C
remitted A’s share. Suppose B paid C P10,000 before the remission, A is
still liable to B because the remission is without effect, the obligation
having been extinguished already by the payment.
8. The remission of the whole obligation obtained by one of the solidary debtors
does not entitle him to reimbursement from his co-debtors. 
Example: A and B are solidarily indebted to C. C remitted the whole
obligation out of liberality for A. Here, A is not entitled to reimbursement
from B since S did not pay anything to C. 

Rule in case thing has been lost or prestation has become impossible (Art. 1221)
If the thing is lost or the prestation becomes impossible, the liability of the solidary
debtors depends upon whether or not there is fault or delay. 
Example: If A, B, C and D are solidarily liable to X for the delivery of a
specific ring valued at P50,000.00. If the ring is lost through a fortuitous
event, the obligation is extinguished. This is in accordance with the rule
that no person shall be responsible for fortuitous events. If the ring is lost
through the fault of D, all the solidary debtors shall be liable for the
payment of the price of the ring plus damages and interest. However, the
solidary debtor making the payment can recover which he has paid from
the guilty debtor. 

Defenses available to solidary debtors (Art. 1222)

1. Those derived from the nature of the obligation (such as prescription of the
obligation, illegality of the cause, etc.)
 2. Those personal to the debtor being sued, or those that pertain to his own share
(such as incapacity of the debtor or non-fulfillment of a suspensive condition as
to his share)
3. Those personal to the other debtors with respect to their own share (such as
incapacity of another debtor or non-fulfillment of a suspensive condition with
respect to the other debtor’s shares)

Activity 2.1: Case Analysis

A, B and C executed a promissory note binding themselves to pay P90,000 to X,

Y and Z. The note is now due and demandable.
a. Can the creditors proceed against A alone for payment of the entire
obligation? Why?
b. Can X alone proceed against A along for payment of the entire obligation?
Why?
c. Suppose that X proceeds against A alone for payment, how much can he
collect? Why?
d. Suppose that C is insolvent, can A and B held liable for his share in the
obligation? Why?
e. Suppose that the obligation was about to prescribe, but X wrote a letter to A
demanding for payment of the entire debt, will this have the effect of
interrupting the running of the period of prescription?
 
References:

The Law on Obligations and Contracts by Hector S. De Leon and Hector M. De Leon,
Jr., 2014 Edition, pp. 151-179

LESSON 3: Divisible and Indivisible Obligations

A divisible obligation is one the object of which, in its delivery or performance, is

capable of partial fulfillment. In determining whether an obligation is divisible or not, the
controlling circumstance is not the possibility of impossibility of partial prestation but the
purpose of the obligation or the intention of the parties. Hence, even though the object
or service may be physically divisible, an obligation is indivisible if so provided by law or
intended by the parties. 
However, if the object is not physically divisible or the service is not susceptible
of partial performance, the obligation is always indivisible, notwithstanding the intention
of the parties to the contrary. 
The following obligations are deemed divisible (Art. 1225):
1. When the obligation has for its object the execution of a certain number of days
of work (such as an obligation to work for 10 days)
 2. When the obligation has for its object the accomplishment of work by metrical
units (such as the obligation to make a table which is, 1.5. meters wide and 4
meters long)
3. Analogous things which by their nature are susceptible of partial performance. 

Meanwhile, the following obligations are deemed indivisible (Art. 1225):

1. Obligation to give definite things (such as the obligation to give a particular
electric fan)
2. Those which are not susceptible of partial performance (such as the obligation to
dance Savage Love in a school program)
3. Those which are provided by law to be indivisible even if the thing or service is
physically divisible (such as the payment of tax which shall should be paid within
a definite period)
4. Those which are intended by the parties to be indivisible even if thing or service
is physically divisible (such as the obligation to give P10,000 on a certain date;
money is physically divisible but the clear intent is for the debtor to deliver the
entire amount at one time and as a whole)   

Indivisibility and solidarity

The indivisibility of an obligation refers to the subject matter or object not being
susceptible of partial performance. Solidarity, on the other hand, refers to the tie
between the parties. Therefore, there may be the following obligations
1. Joint divisible obligation (such as the joint obligation of A and B to C to make a
table of 2 meter width and 4 meter length)
2. Joint indivisible obligation (such as the joint obligation of A and B to give a
specific dog to C)
3. Solidary divisible obligation (such as the obligation of A and B, solidary debtors,
to pay C P100,000 in four installments)
4. Solidary indivisible obligation (such as the obligation of A and B, solidary debtors,
to give a specific dog to C)

Joint indivisible obligation

This is an obligation where the debtors or creditors are jointly bound but the
prestation or object is indivisible. It has the following characteristics:
1. The creditors must act collectively, meaning, all of them must make the demand
unless one is specifically authorized to act for the others. A demand made by one
or some but not all of the creditors will not be effective.
2. The demand must be made against all the debtors since compliance is possible
only if they act together.
3. The right of the creditors may be prejudiced only by their collective acts. Thus, a
renunciation made by a joint creditor extinguishes only his own share. The
obligation, however, is converted into an obligation to pay the value of the thing.
If all joint creditors make the renunciation, the obligation is extinguished.
4. If one of the debtors does not comply with his undertaking, the obligation is
converted into a monetary obligation to pay damages. The debtor who may have
been ready to comply shall not contribute to the indemnity beyond the
 corresponding price of the thing or the value of the service in which the obligation
consists. 
5. If one of the debtors is insolvent, the other shall not be liable for his share. 

References:

The Law on Obligations and Contracts by Hector S. De Leon and Hector M. De

Leon, Jr., 2014 Edition, pp. 180-189.

LESSON 4: Obligations with a Penal Clause

A principal obligation is one which can stand by itself and does not depend for its
validity and existence upon another obligation. An accessory obligation, on the other
hand, is one which is attached to a principal obligation and therefore, cannot stand
alone.
An obligation with a penal clause is one which contains an accessory
undertaking (penal clause) to pay a previously stipulated indemnity in case of breach of
the principal prestation, intended primarily to induce its fulfillment. In effect, this kind of
obligation provides for a greater liability on the part of the debtor in case of non-
compliance. 
The penal clause operates to insure performance and functions as (1) a deterrent
against breach by strengthening the coercive force of the obligation, and (2) a substitute
a penalty for the indemnity for damages (providing for liquidated damages). It can also
be viewed as a punishment to the debtor in case of non-fulfillment or violation of his
obligation. 
Proof of actual damages suffered by the creditor is no necessary in order that the
penalty may be demanded. (Art. 1228)

Kinds of penal clause

1. As to origin:
a. Legal penal clause – when it is provided by law
b. Conventional penal clause – when it is provided for by stipulation of the
parties
2. As to its purpose:
a. Compensatory penal clause – when the penalty takes the place of damages
b. Punitive penal clause – when the penalty is imposed merely as punishment
for breach
3. As to its demandability or effect
a. Subsidiary or alternative penal clause – when only the penalty can be
enforced
b. Joint or cumulative penal clause – when both the principal obligation and the
penal clause can be enforced

Rules in case obligation has a penal clause (Art. 1226, 1227)

General rule: The penalty takes the place of the damages and interest in case of non-
compliance.
 Exceptions: Aside from the penalty, damages and interest may also be demanded
under the following cases:
1. When there is a stipulation to that effect
2. When the debtor refuses to pay the penalty
3. When the debtor is guilty of fraud in the performance of the obligation

When the court may reduce the penalty (Art. 1229)

1. When the obligation has been partly complied with by the debtor
2. When the obligation has been irregularly complied with by the debtor
3. When the penalty is iniquitous or unconscionable even if there has been no
performance. 

Effect of nullity of principal obligation, penal clause (Art. 1230) 

1. The nullity of the principal obligation carries with it the nullity of the penal clause.
This is so because the penal clause, being just an accessory undertaking, cannot
stand by itself.
2. The nullity of the penal clause does not carry with it that of the principal
obligation. This is so because the principal obligation can stand by itself. 

Activity 4.1: Case Analysis

By virtue of a compromise agreement, Duncan became indebted to Curry for the

amount of P250,000.00. An additional amount of P2,000 was provided as penalty in
the agreement in case Duncan fails to complete payment within 60 days. The latter
failed to pay in spite of repeated demands. Subsequently, Curry brought an action
against Duncan. The court sentenced defendant Duncant to pay to plaintiff Curry the
amount of P250,000.00, and the penalty, along with the interest at legal rate. Is the
decision correct? Reasons.

References:

The Law on Obligations and Contracts by Hector S. De Leon and Hector M. De

Leon, Jr., 2014 Edition, pp. 190-200.

OFFLINE READING MATERIALS:

 Read The Law on Obligations and Contracts by Hector S. De Leon and Hector M.
De Leon, Jr., 2014 Edition, pp. 136-200.

ONLINE VIDEO LINKS AND MATERIALS:

 Watch the online video lecture of the course instructor uploaded at NEO LMS
and to the class shared Google drive (if applicable).
 Watch Youtube videos by Atty. Javier Law Vlog via these links:   
  https://www.youtube.com/watch?
v=ri9WJohgOjI&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&index=
8
 https://www.youtube.com/watch?
v=LNe8rMAq9j4&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&index
=9
 https://www.youtube.com/watch?v=tq-
c95mB4ZY&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&index=10
 https://www.youtube.com/watch?
v=_uKMBK8JBE8&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&inde
x=11&pbjreload=101
 Watch Youtube vidoes by Akwanting.com via these links:
 https://www.youtube.com/watch?v=seFefLIEMP0

TEST YOUR KNOWLEDGE:

1. An obligation where various prestations are due but the performance of all of
them is required in order to extinguish the obligation is known as:
a. Alternative obligation
b. Facultative obligation
c. Conjunctive obligation
d. Simple obligation
2. A, B and C are solidarily liable to X for P30,000.00. A pays X the whole amount
due. C, however, is insolvent. 
a. A alone will bear the share of C who is insolvent since he (A) made the payment
b. A can collect from B P10,000.00
c. A can collect from B P15,000.00.
d. A can demand a refund of P10,000.00 from X pertaining to C’s share since C is
insolvent. 
3. A and B are indebted to X and Y for P10,000.00. A and B share in the debt in the
ratio of 1:3; while X and Y share in the credit in the ratio of 2:3. How much may X
collect from A if the debtors are joint debtors, while the creditors are joint
creditor?
a. P10,000
b. P2,500
c. P4,000
d. P1,000
4. Refer to the above problem. How much may X collect from A if there is active
solidarity?
a. P10,000
b. P2,500
c. P4,000
d. P1,000
5. A, B and C are solidary debtors of X, Y and Z, solidary creditors, in the amount of
P2,700.00. X renounces the whole obligation without the consent of Y and Z. The
debtors accepted the renunciation.
 a. The whole obligation is extinguished.
b. Only P900.00 is extinguished.
c. No part of the obligation is extinguished because not all the creditors consented
to the renunciation.
d. Only P300.00 is extinguished. 

MODULE REFERENCES:
 The Law on Obligations and Contracts by Hector S. De Leon
and Hector M. De Leon, Jr., 2014 Edition
 Civil Code of the Philippines
(https://lawphil.net/statutes/repacts/ra1949/ra_386_1949.html)
 https://www.youtube.com/watch?
v=ri9WJohgOjI&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&index
=8
 https://www.youtube.com/watch?
v=LNe8rMAq9j4&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&inde
x=9
 https://www.youtube.com/watch?v=tq-
c95mB4ZY&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&index=10
 https://www.youtube.com/watch?
v=_uKMBK8JBE8&list=PLBnOkbjrg7Eho7clDSkJOjgcjhtpCotY0&in
dex=11&pbjreload=101
 https://www.youtube.com/watch?v=seFefLIEMP0