Different Kinds of Obligations
ART. 1179. Every obligation whose (1) when it is pure (Art. 1179, par. 1.);
performance does not depend upon a future or
uncertain event, or upon a past event unknown
to the parties, is demandable at once.
Every obligation which contains a
resolutory condition shall also be demandable,
without prejudice to the effects of the
happening of the event. (1113)
Meaning of pure obligation
A pure obligation - not subject to any condition
and no specific date is mentioned for its
fulfillment and is, therefore, immediately
demandable.
Meaning of conditional obligation
A conditional obligation - consequences are
subject in one way or another to the fulfillment
of a condition.
Meaning of condition
Condition - future and uncertain event, upon
the happening of which, the effectivity or
extinguishment of an obligation (or rights)
subject to it depends.
Characteristics of a condition
(1) Future and uncertain
(2) Past but unknown
*A condition must not be impossible.
Two principal kinds of condition
(1) Suspensive condition (condition
precedent or condition antecedent) or
one the fulfillment of which will give
rise to an obligation (or right).
(2) Resolutory condition (condition
subsequent) or one the fulfillment of
which will extinguish an obligation (or
right) already existing
When obligation demandable at once.
An obligation is demandable at once —
(2) when it is subject to a resolutory condition
(Ibid., par. 2.); or
(3) when it is subject to a resolutory period.
(Art. 1193, par. 2.)
ART. 1180. When the debtor binds himself to
pay when his means permit him to do so, the
obligation shall be deemed to be one with a
period, subject to the provisions of Article 1197.
A period is a future and certain event upon the
arrival of which the obligation subject to it
either arises or is extinguished.
(1) The debtor promises to pay when his
means permit him to do so. The
obligation shall be deemed to be one
with a period.
(2) (2) Other cases. — As when the debtor
binds himself to pay:
(a) “little by little”
(b) “as soon as possible”
(c) “from time to time;”
(d) “as soon as I have the money”
(e) “at any time I have the money”
(f) “in partial payments”
(g) “when I am in a position to pay.”
ART. 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)
Effect of happening of condition.
(1) Acquisition of rights.
(2) Loss of rights already acquired.
ART. 1182. When the fulfillment of the condition
depends upon the sole will of the debtor, the
conditional obligation shall be void. If it depends
upon chance or upon the will of a third person,
the obligation shall take effect in conformity
with the provisions of this Code.
Classifications of conditions.
(1) As to effect.
(a) Suspensive. — the happening of
which gives rise to the obligation; and
(b) Resolutory. — the happening of
which extinguishes the obligation.
(2) As to form.
(a) Express. — the condition is clearly
stated; and
(b) Implied. — the condition is merely
inferred.
(3) As to possibility.
(a) Possible. — the condition is capable
of fulfillment, legally and physically; and
(b) Impossible. — the condition is not
capable of fulfi llment, legally or physically.
(4) As to cause or origin.
(a) Potestative. — the condition
depends upon the will of one of the contracting
parties;
(b) Casual. — the condition depends
upon chance or upon the will of a third person;
and
(c) Mixed. — the condition depends
partly upon chance and partly upon the will of a
third person.
(5) As to mode.
(a) Positive. — the condition consists in
the performance of an act; and
(b) Negative. — the condition consists
in the omission of an act.
(6) As to number.
(a) Conjunctive. — there are several
conditions and all must be fulflled; and
(b) Disjunctive. — there are several
conditions and only one or some of them must
be fulfilled.
(7) As to divisibility.
(a) Divisible. — the condition is
susceptible of partial performance; and
(b) Indivisible. — the condition is not
susceptible of partial performance
Meaning of potestative condition.
A potestative condition - a condition suspensive
in nature and which depends upon the sole will
of one of the contracting parties.
Where suspensive condition depends upon the
will of debtor.
(1) Conditional obligation void.
(2) Only the condition void.
Where suspensive condition depends upon the
will of creditor.
If the condition depends exclusively upon the
will of the creditor, the obligation is valid.
Where resolutory condition depends upon the
will of debtor.
The obligation is valid although its fulfillment
depends upon the sole will of the debtor.
Casual condition.
(1) If the suspensive condition depends
upon chance or upon the will of a third
person, the obligation subject to it is
valid.
 (2) When the fulfillment of the condition
does not depend on the will of the
obligor, but that on a third person who
can in no way be compelled to carry it
out, and it is found by the court that the
obligor has done all in his power to
comply with his obligation, his part of
the contract is deemed complied with
and he has a right to demand
performance of the contract by the
other party.
Mixed condition.
The obligation is valid if the suspensive
condition depends partly upon chance and
partly upon the will of a third person.
Where suspensive condition depends partly
upon the will of debtor
*if the compliance with the obligation still
depends upon that part of the condition whose
fulfillment depends upon the will of the debtor,
the obligation is void as it is within his power to
comply or not to comply with the same. The
situation is the same as if the condition depends
entirely upon the will of the debtor.
ART. 1183. Impossible conditions, those
contrary to good customs or public policy and
those prohibited by law shall annul the
obligation which depends upon them. If the
obligation is divisible, that part thereof which is
not affected by the impossible or unlawful
condition shall be valid. The condition not to do
an impossible thing shall be considered as not
having been agreed upon.
When Article 1183 applies.
Article 1183 refers to suspensive conditions. It
applies only to cases where the impossibility
already existed at the time the obligation was
constituted. If the impossibility arises after the
creation of the obligation, Article 1266 governs.
Two kinds of impossible conditions.
(1) Physically impossible conditions. — when
they, in the nature of things, cannot exist or
cannot be done; and
(2) Legally impossible conditions. — when they
are contrary to law, morals, good customs,
public order, or public policy.
Effect of impossible conditions.
(1) Conditional obligation void.
(2) Conditional obligation valid.
(3) Only the affected obligation void.
(4) Only the condition void.
ART. 1184. The condition that some event
happen at a determinate time shall extinguish
the obligation as soon as the time expires or if it
has become indubitable that the event will not
take place.
Positive condition.
The obligation is extinguished:
(1) as soon as the time expires without the
event taking place; or
(2) as soon as it has become indubitable
that the event will not take place
although the time specified has not yet
expired.
ART. 1185. The condition that some event will
not happen at a determinate time shall render
the obligation effective from the moment the
time indicated has elapsed, or if it has become
evident that the event cannot occur. If no time
has been fixed, the condition shall be deemed
fulfilled at such time as may have probably been
contemplated, bearing in mind the nature of the
obligation.
Negative condition.
The obligation shall become effective and
binding:
(1) from the moment the time indicated has
elapsed without the event taking place; or
(2) from the moment it has become evident
that the event cannot occur, although the time
indicated has not yet elapsed.
If no time is fixed, the circumstances shall be
considered to determine the intention of the
parties. This rule may also be applied to a
positive condition.
ART. 1186. The condition shall be deemed
fulfilled when the obligor voluntarily prevents its
fulfillment.
Constructive fulfillment of suspensive
condition.
There are three (3) requisites for the application
of this article:
(1) The condition is suspensive;
(2) The obligor actually prevents the fulfillment
of the condition; and
(3) He acts voluntarily.
The law does not require that the obligor acts
with malice or fraud as long as his purpose is to
prevent the fulfillment of the condition.
Constructive fulfillment of resolutory
condition.
Article 1186 applies also to an obligation subject
to a resolutory condition with respect to the
debtor who is bound to return what he has
received upon the fulfillment of the condition.
ART. 1187. The effects of a conditional
obligation to give, once the condition has been
fulfilled, shall retroact to the day of the
constitution of the obligation. Nevertheless,
when the obligation imposes reciprocal
prestations upon the parties, the fruits and
interests during the pendency of the condition
shall be deemed to have been mutually
compensated. If the obligation is unilateral, the
debtor shall appropriate the fruits and interests
received, unless from the nature and
circumstances of the obligation it should be
inferred that the intention of the person
constituting the same was different. In
obligations to do and not to do, the courts shall
determine, in each case, the retroactive effect of
the condition that has been complied with.
Retroactive effects of fulfillment of suspensive
condition.
(1) In obligations to give. — An obligation
to give subject to a suspensive
condition becomes demandable only
upon the fulfillment of the condition.
However, once the condition is fulfilled,
its effects shall retroact to the day when
the obligation was constituted.
(2) In obligations to do or not to do. —
With respect to the retroactive effect of
the fulfillment of a suspensive condition
in obligations to do or not to do, no
fixed rule is provided.
ART. 1188. The creditor may, before the fulfi
llment of the condition, bring the appropriate
actions for the preservation of his right. The
debtor may recover what during the same time
he has paid by mistake in case of a suspensive
condition.
Rights pending fulfillment of suspensive
condition.
 (1) Rights of creditor. — He may take or
bring appropriate actions for the
preservation of his right, as the debtor
may render nugatory the obligation
upon the happening of the condition. It
applies by analogy to obligations
subject to a resolutory condition.
(2) Rights of debtor. — He is entitled to
recover what he has paid by mistake
prior to the happening of the
suspensive condition. This is a case of
solutio indebiti.
ART. 1189. When the conditions have been
imposed with the intention of suspending the
efficacy of an obligation to give, the following
rules shall be observed in case of the
improvement, loss or deterioration of the thing
during the pendency of the condition:
(1) If the thing is lost without the fault of the
debtor, the obligation shall be extinguished;
(2) If the thing is lost through the fault of the
debtor, he shall be obliged to pay damages; it is
understood that the thing is lost when it
perishes, or goes out of commerce, or
disappears in such a way that its existence is
unknown or it cannot be recovered;
(3) When the thing deteriorates without the
fault of the debtor, the impairment is to be
borne by the creditor;
(4) If it deteriorates through the fault of the
debtor, the creditor may choose between the
rescission of the obligation and its fulfillment,
with indemnity for damages in either case;
(5) If the thing is improved by its nature, or by
time, the improvement shall inure to the benefit
of the creditor;
(6) If it is improved at the expense of the debtor,
he shall have no other right than that granted
to the usufructuary.
Requisites for application of Article 1189.
Article 1189 applies only if:
(1) The obligation is a real obligation;
(2) The object is a specific or determinate thing;
(3) The obligation is subject to a suspensive
condition;
(4) The condition is fulfi lled; and
(5) There is loss, deterioration, or improvement
of the thing during the pendency of the
happening on one condition.
Kinds of loss.
(1) Physical loss. — when a thing perishes
as when a house is burned and reduced
to ashes; or
(2) Legal loss. — when a thing goes out of
commerce or when a thing heretofore
legal becomes illegal.
(3) Civil loss. — when a thing disappears in
such a way that its existence is
unknown or even if known, it cannot be
recovered.
Rules in case of loss, etc. of thing during
pendency of suspensive condition.
(1) Loss of thing without debtor’s fault -
The obligation is extinguished and
Debtor is not liable to Creditor even if
Creditor sells the property. A person, as
a general rule, is not liable for a
fortuitous event.
(2) Loss of thing through debtor’s fault —
Creditor will be entitled to demand
damages plus incidental damages, if
any.
(3) Deterioration of thing without debtor’s
fault. — A thing deteriorates when its
value is reduced or impaired with or
without the fault of the debtor.
 (4) Deterioration of thing through debtor’s
fault. — In this case, C may choose
between: (a) Rescission (or cancellation)
of the obligation with damages;
payment of debtor for the value of the
car before its deterioration plus
incidental damages, if any; or (b)
Fulfillment of the obligation also with
damages; debtor is bound to C to give
the car and pay damages plus incidental
damages, if any.
(5) Improvement of thing by nature or by
time. — A thing is improved when its
value is increased or enhanced by
nature or by time or at the expense of
the debtor or creditor. The
improvement shall inure to the benefit
of Creditor.
(6) (6) Improvement of thing at expense of
debtor. — In this case, Debtor will have
the right granted to a usufructuary with
respect to improvements made on the
thing held in usufruct.
Kinds of obligation according to the person
obliged
ART. 1190. When the conditions have for their
purpose the extinguishment of an obligation to
give, the parties upon the fulfillment of said
conditions, shall return to each other what they
have received. In case of the loss, deterioration
or improvement of the thing, the provisions
which, with respect to the debtor, are laid down
in the preceding article shall be applied to the
party who is bound to return. As for obligations
to do and not to do, the provisions of the second
paragraph of Article 1187 shall be observed as
regards the effect of the extinguishment of the
obligation.
Effects of fulfillment of resolutory condition.
Choice of remedy by injured party.
(1) In obligations to give. — When the
resolutory condition in an obligation to
give is fulfilled, the obligation is
extinguished (Art. 1181.) and the
parties are obliged to return to each
other what they have received under
the obligation.
(a) There is a return to the status quo.
In other words, the effect of the
fulfillment of the condition is
retroactive.
(b) In case the thing to be returned is
legally in the possession of a third
person who did not act in bad faith
the remedy of the party entitled to
restitution is against the other.
(c) The obligation of mutual restitution
is absolute. It applies not only to
the things received but also to the
fruits and interests.
(d) In obligations to give subject to a
suspensive condition, the
retroactivity admits of exceptions
according to whether the obligation
is bilateral or unilateral.
(1) Unilateral. — when only one party is
obliged to comply with a prestation.
(2) Bilateral. — when both parties are
mutually bound to each other. In other
words, both parties are debtors and
creditors of each other.
(a) Reciprocal obligations are those
which arise from the same cause
and in which each party is a debtor
and creditor of the other.
(b) (b) Non-reciprocal obligations are
those which do not impose
simultaneous and correlative
performance on both parties.
(1) Choice of remedy
 (a) action for specific performance
(fulfillment) of the obligation with
damages;
(b) action for rescission of the
obligation also with damages.
(2) Remedy of recission for non-compliance

Limitations on right to demand recission

(1) Resort to the courts

(2) Power of court to fix period
(3) Right of third person
(4) Substantial violation
(5) Waiver of right

Rescission without previous judicial decree

(1) Where automatic rescission expressly

stipulated.
(2) Where contract still executory.

Where both parties are guilty of breach.

(1) First infractor known – the liability of

the first infractor should be equitably
reduced.
(2) First infractor cannot be determined –
the contract shall be deemed
extinguished, and each shall bear his
own damages.

Obligation with a Period

Period and condition distinguished.

(1) As to fulfillment. — A period is a certain

event which must happen sooner or later at a
date known beforehand, or at a time which
cannot be determined, while a condition is an
uncertain event;
(2) As to time. — A period refers only to the
future, while a condition may refer also to a
past event unknown to the parties;
(3) As to influence on the obligation. — A period
merely fixes the time for the efficaciousness of
the obligation. If suspensive, it cannot prevent
the birth of the obligation in due time; if
resolutory, it does not annul, even in fiction, the
fact of its existence. On the other hand, a
condition causes an obligation to arise or to
cease.
(4) As to effect, when left to debtor’s will. — A
period which depends upon the will of the
debtor empowers the court to fix the duration
thereof, while a condition which depends upon
the sole will of the debtor invalidates the
obligation;
5) As to retroactivity of effects. — Unless there
is an agreement to the contrary, the arrival of a
period does not have any retroactive effect,
while the happening of a condition has
retroactive effect.
Kinds of period or term.
(1) According to effect:
(a) Suspensive period (ex die). — The obligation
begins only from a day certain upon the arrival
of the period; and
(b) Resolutory period (in diem). — The
obligation is valid up to a day certain and
terminates upon the arrival of the period.
(2) According to source:
(a) Legal period. — When it is provided for by
law;
(b) Conventional or voluntary period. — When it
is agreed to by the parties;
(c) Judicial period. — When it is fixed by the
court.
(3) According to definiteness:
(a) Definite period. — When it is fixed or it is
known when it will come; and
(b) Indefinite period. — When it is not fixed or
it is not known when it will come.
No recovery in personal obligations – it is
physically impossible to recover the service
rendered.
Presumption as to benefit of period. In an
obligation subject to a period fixed by the
parties, the period is presumed to have been
established for the benefit of both the creditor
and the debtor.
Exceptions to the general rule.
(1) Term is for the benefit of the debtor
alone.
(2) Term is for the benefit of the creditor.
Court generally without power to fix a period.
Exceptions to the general rule.
(1) No period is fi xed but a period was
intended.
(2) Duration of period depends upon the will
of the debtor.
Period fixed cannot be changed by the courts.
(1) Period agreed upon parties
(2) Period fixed by courts
When obligation can be demanded before
lapse of period.
(1) When debtor becomes insolvent.
(2) When debtor does not furnish
guaranties or securities promised.
(3) When guaranties or securities given
have been impaired or have
disappeared.
(4) When debtor violates an undertaking.
(5) When debtor attempts to abscond.
Alternative Obligations
Kinds of obligation according to object.
(1) Simple obligation. — one where there is
only one prestation
(2) Compound obligation. — one where there
are two or more prestations.
(a) Conjunctive obligation. — one where
there are several prestations and all of them are
due; or
(b) Distributive obligation. — one
where one of two or more of the prestations is
due.
1.) Alternative obligation– one
where several prestations are due but the
performance of one is sufficient.
2.) Facultative obligation – one
where only one prestation is due but
the debtor may substitute another.
As a general rule, the right to choose the
prestation belongs to the debtor
The right of choice of the debtor is subject to
limitations.
(1) The debtor cannot choose those prestations
which are: (a) impossible, (b) unlawful, or (c)
which could not have been the object of the
obligation.
(2) The debtor has no more right of choice,
when among the prestations whereby he is
alternatively bound, only one is practicable.
(3) The debtor cannot choose part of one
prestation and part of another prestation.
Rules in case of loss before creditor has made
choice.
(1) When a thing is lost through a
fortuitous event. – Buyer can choose
from among the remainder or that
which remains.
(2) When a thing is lost through debtor’s
fault. – Buyer can claim either item with
a right to damages or the price of one
time also with a right to damages.
(3) When all the things are lost through
debtor’s fault. - Buyer can demand the
payment of the price of any one of
them with a right to indemnity for
damages
(4) When all the things are lost through a
fortuitous event - The obligation of
Seller shall be extinguished.
A facultative obligation is one where only one
prestation has been agreed upon but the
obligor may render another in substitution.
Effect of loss.
(1) Before substitution. — If the principal
thing is lost through a fortuitous event,
the obligation is extinguished;
otherwise, the debtor is liable for
damages.
(2) After substitution. — If the principal
thing is lost, the debtor is not liable
whatever may be the cause of the loss,
because it is no longer due. If the
substitute is lost, the liability of the
debtor depends upon whether or not
the loss is due through his fault.
Alternative and facultative obligations
distinguished.
(1) Number of prestations. — In the first,
several prestations are due but compliance with
one is sufficient, while in the second, only one
prestation is due although the debtor is allowed
to substitute another;
(2) Right of choice. — In the first, the right of
choice may be given to the creditor or third
person, while in the second, the right to make
the substitution is given only to the debtor;
(3) Loss through fortuitous event. — In the first,
the loss of one or more of the alternatives
through a fortuitous event does not extinguish
the obligation, while in the second, the loss of
the thing due extinguishes the obligation;
(4) Loss through fault of debtor. —
(a) In the first, the loss of one of the alternatives
through the fault of the debtor does not render
him liable, while in the second, the loss of the
thing due through his fault makes him liable;
and
(b) In the first, where the choice belongs to the
creditor, the loss of one alternative through the
fault of the debtor gives rise to liability, while in
the second, the loss of the substitute before the
substitution through the fault of the debtor
does not render him liable; second, the debtor
is not bound to choose the substitute
Joint and Solidary Obligations
Kinds of obligation according to the number of
parties.
(1) Individual obligation. — one where there is
only one obligor and one obligee; and
(2) Collective obligation. — one where there
are two or more debtors and/or two or more
creditors. It may be joint or solidary.
Kinds of solidarity.
(1) According to the parties bound:
(a) Passive solidarity or solidarity on the
part of the debtors, where anyone of them can
be made liable for the fulfillment of the entire
obligation.
(b) Active solidarity or solidarity on the
part of the creditors, where anyone of them can
demand the fulfillment of the entire obligation.
(c) Mixed solidarity or solidarity on the
part of the debtors and creditors, where each
one of the debtors is liable to render, and each
one of the creditors has a right to demand,
entire compliance with the obligation.
(2) According to source:
(a) Conventional solidarity or where
solidarity is agreed upon by the parties. If
nothing is mentioned in the contract relating to
solidarity, the obligation is only joint.
(b) Legal solidarity or where solidarity is
imposed by the law.
(c) Real solidarity or where solidarity is
imposed by the nature of the obligation.
Solidarity not presumed. The presumption,
where there are two or more persons in the
same obligation, is that it is joint.
Kinds of solidary obligation according to the
legal tie.
(1) Uniform. — when the parties are bound by
the same stipulations or clauses; or
(2) Non-uniform or varied. — when the parties
are not subject to the same stipulations or
clauses.
Solidarity not affected by diverse stipulations.
1.) The essence of solidarity consists in the right
of each creditor to enforce the rights of all and
the liability of each debtor to answer for the
liabilities of all.
2.) The rule is that the creditor may bring his
action in toto against any of the solidary
debtors less the shares of the other debtors
with unexpired terms or unfulfilled conditions
who are entitled to defenses under Article
1222.
3.) The parties may stipulate that any solidary
debtor already bound may be made liable for
the entire obligation.
* A solidary creditor may do any act beneficial
or useful to the others but he cannot perform
any act prejudicial to them.
* In the absence of consent given by the others,
a solidary creditor cannot assign his rights to a
third person. In the absence of consent given by
the others, a solidary creditor cannot assign his
rights to a third person.
* The rule is that the debtor may pay any one of
the solidary creditors. But when a demand,
judicial or extra-judicial, has been made by one
of them, to avoid confusion, as well as prejudice
to the more diligent creditor, payment should
be made to him
* Novation, compensation, confusion, and
remission are modes or causes of
extinguishment of obligations.
* In a joint obligation, novation, compensation,
confusion, remission, prescription, and any
other cause of modification or extinction does
not extinguish or modify the obligation except
with respect to the creditor or debtor affected,
without extending its operation to any other
part of the debt or of the credit.
Effects of payment by a solidary debtor.
(1) Between the solidary debtors and
creditor(s). - Payment made by one of
the solidary debtors extinguishes the
obligation. Payment made by one of the
solidary debtors extinguishes the
obligation.
(2) Among the solidary debtors. —
Payment by one of the solidary debtors
does not create a real case of
subrogation.
(3) Among the solidary creditors. — The
receiving creditor is jointly liable to the
others for their corresponding shares.
When a solidary debtor pays the obligation, he
is entitled, as a rule, to reimbursement from his
co-debtors.
Two cases when the paying debtor cannot get
any reimbursement: When the obligation has
prescribed or become illegal (Art. 1266.), the
obligation is extinguished.
Prescriptive periods of actions.
“By prescription, one acquires ownership and
other rights through the lapse of time in the
manner and under the conditions laid down by
law. In the same way, rights and actions are lost
by prescription.”
“The following actions must be brought within
ten (10) years from the time the right of action
accrues:
(1) Upon a written contract;
(2) Upon an obligation created by law;
(3) Upon a judgment.“ (Art. 1144.)
“The following actions must be commenced
within six (6) years:
(1) Upon an oral contract;
(2) Upon a quasi-contract.“ (Art. 1145.)
“The following actions must be instituted within
four (4) years:
(1) Upon an injury to the rights of the plaintiff;
(2) Upon a quasi-delict.’’ (Art. 1146.)
The statute of limitations, however, may be
superseded or modified by a contract between
the parties.
* If payment is made first, the remission or
waiver is of no effect.
* No right to reimbursement in case of
remission.
Rules in case thing has been lost or prestation
has become impossible.
(1) Loss is without fault and before delay
(2) Loss is due to fault on the part of a
solidary debtor.
(3) Loss is without fault but after delay
Defenses available to a solidary debtor.
(1) Defenses derived from the nature of
the obligation.
(2) Defenses personal to, or which pertain
to share of, debtor sued.
(3) Defenses personal to other solidary
debtors.
Divisible and Indivisible Obligations
*In determining whether an obligation is
divisible or not, the controlling circumstance is
not the possibility or impossibility of partial
prestation but the purpose of the obligation or
the intention of the parties.
Kinds of division
(1) Qualitative division or one based on
quality, not on number or quantity of
the things that are the object of the
obligation.
(2) Quantitative division or one based on
quantity rather than on quality.
(3) Ideal or intellectual division or one
which exists only in the minds of the
parties.
Kinds of indivisibility.
(1) Legal indivisibility. — where a specific
provision of law declares as indivisible,
obligations which, by their nature, are divisible
(2) Conventional indivisibility. — where the will
of the parties makes as indivisible, obligations
which, by their nature, are divisible.
(3) Natural indivisibility. — where the nature of
the object or prestation does not admit of
division, e.g., to give a particular car, to sing a
song, etc.
*If any one of the debtors does not comply with
his undertaking in a joint indivisible obligation,
the obligation is transformed into one for
damages, i.e., to pay money.
Obligations deemed indivisible.
(1) Obligations to give definite things
(2) Obligations which are not susceptible of
partial performance
(3) Obligations provided by law to be
indivisible even if thing or service is
physically divisible
(4) Obligations intended by the parties to
be indivisible even if thing or service is
physically divisible
Obligations deemed divisible.
(1) Obligations which have for their object
the execution of a certain number of
days of work
 (2) Obligations which have for their object
the accomplishment of work by
metrical units
(3) Obligations which by their nature are
susceptible of partial performance
*In negative obligations not to do, the character
of the prestation in each particular case shall
determine their divisibility or indivisibility.
Obligations “to do” and “not to do” are
generally indivisible.
Obligations with a Penal Clause
Meaning of principal and accessory
obligations.
(1) Principal obligation - one which can stand by
itself and does not depend for its validity and
existence upon another obligation.
(2) Accessory obligation - one which is attached
to a principal obligation and, therefore, cannot
stand alone.
A penal clause - an accessory undertaking
attached to an obligation to assume greater
liability on the part of the obligor in case of
breach of the obligation.
Purposes of penal clause
(1) to insure their performance by creating an
effective deterrent against breach, making the
consequences of such breach as onerous as it
may be possible.
(2) to substitute a penalty for the indemnity for
damages and the payment of interests in case
of non-compliance or to punish the debtor for
the non-fulfillment or violation of his obligation.
Kinds of penal clause.
(1) As to its origin:
(a) Legal penal clause. — when it is
provided for by law; and
(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;
and
(b) Punitive penal clause. — when the
penalty is imposed merely as punishment for
breach.
(3) As to its dependability or effect:
(a) Subsidiary or alternative penal
clause. — when only the penalty can be
enforced; and
(b) Joint or cumulative penal clause. —
when both the principal obligation and the
penal clause can be enforced.
 2.) The borrower cannot claim that he is no
longer liable to pay his loan after paying
* As a general rule, the penalty takes the place
the penalty.
of the indemnity for damages and the payment
of interests in case of non-compliance. Proof of
actual damages suffered by the creditor is not
* All that the creditor has to prove, to enforce
necessary in order that the penalty may be
the penalty, is the violation of the obligation by
enforced. The parties may stipulate that interest
the debtor. It is not necessary to adduce
may be demanded in addition to the penalty.
evidence to prove losses and damages suffered
by the creditor or the extent of the same.

Penalty, damages and interests enforceable. —
(a) When so stipulated by the parties;
(b) When the obligor refuses to pay the penalty;
(c) When the obligor is guilty of fraud in the
fulfillment of the obligation.
* The penalty may be enforced only when it is
demandable in accordance with the provisions
of the Civil Code.
* Generally, the debtor cannot just pay the
penalty instead of performing the obligation.
Precisely, the object of the penalty is to secure
compliance with the obligation.
Penal clause presumed subsidiary.
When penalty may be reduced by the courts.
(1) When there is partial or irregular
performance.
(2) When the penalty agreed upon is
iniquitous or unconscionable.
*If only the penal clause is void, the principal
obligation remains valid and demandable. The
penal clause is just disregarded.
* If the principal obligation is void, the penal
clause is likewise void. But if the nullity of the
principal obligation is due to the fault of the
debtor who acted in bad faith, by reason of
which the creditor suffered damages on
equitable grounds, the penalty may be
enforced.

(1) Where there is performance - — Once

the obligation is fulfilled, this purpose is
attained and, therefore, there is no
need for demanding the penalty.
(2) Where there is no performance. — In
case of non-compliance, the creditor
may ask for the penalty or require
specific performance.

When penal clause joint.

1.) The debtor has the right to pay the

penalty in lieu of performance only
when this right has been expressly
reserved for him.