Section 2 - Obligations With A Period The Law On Obligations and Contract Section 2 - Obligations With A Period

Unit Section 2 – Obligations with a Period
Module The Law on Obligations and Contract Page |1

TLOC Section 2 – Obligations with a Period Units: 3.0
INFORMATION SHEET MT 8.1.1

Section 2 – Obligations with a Period
Sec. 2 – Obligations with a Period

Art. 1193. Obligations for whose fulfillment a day certain has been fixed, shall be demandable only
when that day comes.
Obligations with a resolutory period take effect once, but terminate upon arrival of the day
certain. A day certain is understood to be that which must necessarily come, although it may not be
known when.
If the uncertainty consists in whether the day will come or not, the obligation is conditional,
and it shall be regulated by the rules of the preceding Section.
Term or Period- interval of time, which exerting an influence on an obligation as a consequence of a

juridical act, either suspends its demandability or produces its extinguishment.
Obligations with a period- obligations whose demandability or extinguishment is subject to the

expiration of a term or a period.
Requisites:
1. Future
2. Certain
3. Possible, legally and physically
A day certain – understood to be that which must necessarily come, although it may not be known
when
Certainty of event may be either:
a) absolutely known (e.g.: May 23, 2010)
b) relatively known (e.g.: fixing a period several days after May 23, 2010)
c) totally unknown (day when a person dies)
Classification of Term/Period
A. According to source
1. Voluntary/ conventional – fixed by the will of the parties
2. Legal – fixed by law 3. Judicial – fixed by the courts
B. According to effect
1. Suspensive (ex die or dies a quo) – when the obligation is demandable only when the day comes
2. Resolutory (in diem or dies ad quem) – when the obligation takes effect at once but terminates upon
the arrival of the day certain
C. According to definiteness
1. Definite – when the period is fixed
2. Indefinite – when the term or period is not fixed
PREPARED BY: APPROVED BY:
WEEK 8th MR. WILBERT A. MAÑUSCA
Midterm Pearl Nogra Fabia School Administrator
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Instructor

Different Kind of Obligations
D. According to expression
1. Express – when the period is stipulated in the obligation
2. Tacit – when from the nature or circumstances, it can be inferred that a period was intended
E. According to nature
1. Ordinary – that which would not prevent the obligation from being fulfilled despite the lapse of the
same in accordance with the rules governing delay or mora.
2. Essential – which requires that the obligation be performed precisely and exclusively at the time
stipulated without there being a possibility of its being fulfilled
Effect of Term or Period

 Suspensive – demandable only upon the arrival of the day certain or expiration of the term
 Resolutory – fulfillment is demandable at once but it is extinguished or terminated upon the
arrival of the day certain or expiration of the term
Effect of Fortuitous Event

The stipulation that in the event of force majeure, the contract shall be deemed during the suspended
said period does not mean that the happening of any of those events stops the running of the period the
contract agreed upon to run.
Art. 1194. In case of loss, deterioration or improvement of the thing before the arrival of the day
certain, the rules in article 1189 shall be observed.
This is only applicable to obligations to give a determinate thing.
Art. 1195. Anything paid or delivered before the arrival of the period, the obligor being unaware of
the period or believing that the obligation has become due and demandable, may be recovered, with
the fruits and interests.
Effect of Advance Payment or Delivery

 -If obligor is unaware or believing that payment is due and demandable, paid, or delivered
something before the arrival of the period, he may recover what he has paid or delivered with
fruits and interest. -apply on “to give”
 -If it is voluntary done or done with knowledge that it is not yet due, there can be no right to
recover. -This is construed in relation to Solutio indebiti or payment of what is not due.
 -This pertains to the recovery of thing or money itself, plus the fruits or interest accruing from
the moment of payment to the date of recovery

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Instructor

There is no recovery (Tolentino)

1. When the obligation is reciprocal, and there has been premature performance on both sides
2.When the obligation is a loan on which the debtor bound to pay interest
3.When the period is exclusively for the benefit of the creditor, because the debtor by paying in advance
loses nothing
Art. 1196. Whenever in an obligation a period is designated, it is presumed to have been established
for the benefit of both the creditor and the debtor, unless from the tenor of the same or other
circumstances it should appear that the period has been established in favor of one of the other.
Benefit of Term or Period

General Rule: When a period is designated for the performance or fulfillment of an obligation, it is
presumed to have been established for the benefit of both the creditor and the doctor.
 Presumption
Exception: If it be proved that either from the tenor of the obligation or from other circumstances that
term has been established in favor of the creditor of the debtor.
Term is for the benefit of both parties (Presumption)

The creditor cannot demand payment and the debtor cannot make an effective tender and consignation
of payment before the period stipulated.
Term is for benefit of creditor only (Exception)

- Creditor may demand payment anytime, but the debtor cannot compel him to accept payment before
the period expires (e.g.: contract of loan where interest is stipulated)
- Right to refuse any payment before the expiration of the term could be waived by acceptance of full or
partial payment
Term is for benefit of debtor only (Exception)

Debtor may oppose premature demand for payment, but may validly pay at any time before the period
expires (e.g. contract of loan where no interest is stipulated)
Why a creditor cannot be compelled to accept payment

1. Tax avoidance
2. Interest income
3. Safe investment (e.g. Protection against the sudden decline in the purchasing power of the currency
loaned)

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Instructor

Art. 1197. If the obligation does not fix a period, but from its nature and the circumstances it can be
inferred that a period was intended, the courts may fix the duration thereof. The courts shall also fix
the duration of the period when it depends upon the will of the debtor. In every case, the courts shall
determine such period as may under the circumstances have been probably contemplated by the
parties. Once fixed by the courts, the period cannot be changed by them
Judicial term or period - when fixed by a competent court, the period can no longer be judicially
changed (Art. 1197, par. 3). It becomes a law governing the contract between the party.
General Rule: Courts are without power to fix period

Exceptions: When the Court may fix a period
1. When the obligation does not fix a period, but from its nature and the circumstances it can be
inferred that a period was intended by the parties
2. If the duration of the period depends upon the will of the debtor 3. If the debtor binds himself to pay
when his means permit him to do so --- period.
Cannot be applied to:

- Contracts for services in which no period was fixed by the parties
- Pure obligations
Steps/Nature of the Action

1. Ask the court to fix the duration of the term or period
2. If time elapsed, compel.
Effect of Term
Once the period has been fixed by the court, it becomes part of the contract, and it cannot be
subsequently changed or extended by the court without the consent of both the parties.
Two Ultimate Facts:

1. Facts showing that a contract was entered into imposing on one of the parties an obligation in favor
of the other
2. Facts showing that the performance of the obligation was left to the will of the obligor, or clearly
showing or from which an inference can be reasonably drawn that a period was intended.

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Instructor

Art. 1198. The debtor shall lose every right to make use of the period: [IGIVA]
(1) When after the obligation has been contracted, he becomes insolvent, unless he gives a guarantee
or security for the debt;
(2) When he does not furnish to the creditor the guaranties and securities which he has promised;
(3) When by his own acts he has impaired said guaranties and securities after their establishment, and
when through a fortuitous event they disappear2, unless he immediately gives new ones equally
satisfactory;
(4) When the debtor violates any undertaking, in consideration of which the creditor agreed to the
period;
(5) When the debtor attempts to abscond.
Extinguishment of debtor’s Right to Period

(1) When after the obligation has been contracted, he becomes insolvent, unless he gives a
guaranty or security for the debt;
 insolvency needs no judicial declaration
 includes any case in which it would be impossible financially for the debtor to comply
with his obligations
 such insolvency must not be pre-existing; arose after the constitution of the obligation
 if there is a guaranty or security for the debt, the debtor, in spite of insolvency, does not
lose his right to the period.
(2) When he does not furnish to the creditor the guaranties or securities which he has promised;
such failure renders the original obligation pure and without any condition, and consequently,
the loan become due and demandable.
(3) When by his own acts he has impaired said guaranties or securities after their establishment, and
when through a fortuitous event they disappear, unless he immediately gives new ones equally
satisfactory;
There is a difference between effects of impairment and effects of disappearance

1. if the guaranty or security is impaired through the fault of the debtor, he shall lose his right to the
benefit of the period;
2. if it is impaired without his fault, he shall retain his right;
3. if the guaranty or security disappears through any cause, even without the fault of the debtor, he
shall lose his right to the benefit of the period
4. in either case of impairment or disappearance, the debtor will not lose his right to period if he gives a
new guaranty or security which is equally satisfactory.

8 Meeting
Instructor
(4) When the debtor violates any undertaking, in consideration of which the creditor agreed to the
period;
(5) When the debtor attempts to abscond.  Mere attempt of the debtor disappear or run away from his
obligation.
Section 3 – Alternative and Facultative Obligations

Art. 1199. A person alternatively bound by different prestations shall completely perform one of
them. The creditor cannot be compelled to receive part of one and part of the other undertaking.
(1131)
Classification (CDAF)
1. Conjunctive – all prestations must be performed to extinguish obligation.
2. Disjunctive – one or some prestations must be performed to extinguish obligation.
3. Alternative – debtor must perform one of several alternatives, choice belongs to debtor UNLESS
expressly given to creditor.
4. Facultative – one principal prestation but one or more substitutes, choice belongs to DEBTOR ONLY.
*Absent the indication that it is facultative, the presumption is that it is ALTERNATIVE because creditor
would be at a disadvantage if the obligation is facultative. Facultative is never presumed.
Art. 1200. The right of choice belongs to the debtor, unless it has been expressly granted to the
creditor. The debtor shall have no right to choose those prestations which are impossible, unlawful or
which could not have been the object of the obligation. (1132)
Concept:
Alternative Obligation - obligation wherein various things are due, but the payment of one of them is
sufficient, determined by the choice which as a general rule belongs to the debtor (Luna).
Election by Debtor
In alternative obligations, the debtor has the right to choose the method of meeting the obligation,
unless the creditor has expressly reserved that right to himself.
Election by Others
 The right to choose may be granted to the creditor.
 The choice may also be entrusted by the parties to a third person.
- Although this has not been expressly recognized, there is no reason why it should not be
allowed, since it is not contrary to law, morals, good customs, public order or public policy.
 The grant must be expressed, it cannot be implied.

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Instructor

Exceptions/ Limitations on the Right to Choose by the Debtor (IEx-IOU-OP-PFB)

1. The debtor cannot choose part of one and part of the other undertaking.
a. The creditor cannot be compelled to receive part of one and part of the other undertaking.
[Article 1199, paragraph 2 in relation to Article 1248]
b. There is a presumption of indivisibility
2. He loses the right to choose when the right of choice is expressly granted to the creditor.
c. The right of choice belongs to the debtor, unless it has been expressly granted to the creditor.
[Article 1200]
3. The debtor shall have no right to choose those prestations which are impossible, unlawful or which
could not have been the object of the obligation. [Article 1200, paragraph 2)
d. The presence of such undertaking does not annul the obligation, it as an alternative one if
there are other lawful and possible subjects.
e. Prestations which could not have been the objects of the obligation refers to:
 prestations which turn out to be different from what the parties supposed and which
do not serve the purpose for which the obligation was contracted;
 prestations which are not yet due and demandable;
 prestations which, by reason of accident or some other cause, have acquired a new
character distinct or different from that contemplated by the parties when the
obligation was constituted.
4. The debtor shall lose the right of choice when among the prestations whereby he is alternatively
bound, only one is practicable. [Article 1202]
f. Applies to specific things only
g. The obligation ceases to be alternative, and is converted into a simple obligation to perform
the only practicable prestation.
h. The impossibility of the other prestations, however, must not be due to the creditor’s acts.
For in such case article 1203 applies.
i. This article applies only when debtor has the right to choose.
j. In cases where creditor is granted the right to choose, article 1205 will apply.
5. The debtor loses the right to choose if the period is fixed solely for the benefit of the creditor and
that period has not arrived yet. (According to Sir Ulan  )
k. Whenever in an obligation a period is designated, it is presumed to have been established for
the benefit of both the creditor and the debtor, unless from the tenor of the same or other
circumstances it should appear that the period has been established in favor of one or of the
other. [Article 1196]

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Instructor

Art. 1201.
The choice shall produce no effect except from the time it has been communicated. (1133)
Notice of Selection or Choice (OWUT) - Maybe in any form provided it is sufficient to make the other
party know that the election has been made. It is not subject to any form and may be made:
1. orally;
2. in writing;
3. tacitly;
4. other unequivocal means
Tacit declaration may be seen (PAS):

1. in the performance of the debtor who has the right to choose;
2. in the acceptance of a prestation by a creditor when he has the right of selection; or
3. when the creditor sues for the performance of the prestation.
N.B.
1. When the debtor, to whom the right of choice pertains, performs one of the prestations with the
intent to discharge the obligation, he is released because the selection made may be implied in the fact
of performance.
2. Once the choice is made by the debtor (or by the creditor or by a third person as the case may be),
the obligation ceases to be alternative from the moment the selection has been communicated to the
other party. From that moment, both debtor and creditor are bound by the selection.
3. A selection once made is binding on the person who makes it, and he will not therefore be permitted
to renounce his choice and take an alternative which was first opened to him.
Creditor’s Consent
 The law does not require the other party to consent to the choice made by the party entitled to
choose.
 A mere declaration of the choice, communicated to the other party, is sufficient; it is a unilateral
declaration of will.
Plurality of Subjects

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Instructor
 When there are various debtors or creditors, and the obligation is joint, the consent of all is
necessary to make the selection effective, because none of them can extinguish the entre
obligation.
 If the obligation is solidary, and there is no stipulation to the contrary, the choice by one will be
binding personally upon him, but not as to the others.

Condition or Term
 The selection made by one party cannot be subjected by him to a condition or term unless the
other party consents thereto.
When Choice is Effective
The choice made by the debtor shall produce legal effect only from the time it is communicated to the
creditor. Once the choice is communicated to the creditor, the debtor will no longer be permitted to
renounce his choice and take an alternative which was first open to him (Reyes vs. Martinez, 55 Phil.
492).
N.B.
1. choice is made by the:
a. debtor - debtor shall communicate the choice to the creditor (D ----> C)
b. creditor - creditor shall communicate the choice to the debtor (C ----> D)
c. third person - third person shall communicate the choice to both the debtor and the creditor
(T ---> D and C)
2. The making of a choice is NOT a right, but a DUTY. (Jurado)
Effect of Choice (LCI)

 The effect of notice of choice is to limit the obligation to the object or prestation selected, with
all the consequences which the law provides.
 The obligation is converted to a simple obligation to perform the prestation chosen.
 Once the selection has been communicated, it becomes irrevocable.
Rationale: To allow a change in the selection after it has been communicated to the other party, is to
expose the latter to damages arising from preparations he may make on the assumption that the
prestation selected is the one to be performed. assumption that the prestation selected is the one to be
performed.
Error as to the Obligation

 When the debtor performs one of the prestations, believing that he has a simple obligation (an
ignorance of the alternatives and on his right to choose), there is no declaration of the selection,
nor a binding performance of the obligation. There is payment of what is not due, and the
debtor can recover the se, in accordance with the provisions of the law on Quasi-Contracts.
Delay in the Making of Choice

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Instructor
Module The Law on Obligations and Contract P a g e | 10
Who will make a selection when the entitled party to choose delays in making his selection?
 The German Doctrine stated that the right to choose passes automatically to the other party
when there is delay on the part of the party entitled to choose. (according to Tolentino, this is
acceptable under our law)
Can the creditor enforce the obligation if the debtor has not yet made his choice?
 It is the debtor’s duty to select at the time when the performance should be effected. If he does
not do so, the creditor cannot enforce the obligation. However, the choice can be made by him
(creditor) by applying the principle of Article 1167 on obligations to do.
 When the obligation consists of not doing, and the obligor does what has been
forbidden him, it shall be undone at his expense. [Article 1167]
 The debtor in such case should be deemed to have waived his right to choose in favor of the
creditor who may exercise such right.
References:
Refer to Article 1249, Civil Code of the Philippines. 34 -- Article 1236, par. 2; Article 1237, 1302, 1303,
Civil Code of the Philippines. 35 -- Philippine Legal Encyclopedia by Jose Agaton R. Sibal, page
34Norberto Quisumbing, Sr., and Gunther Loeffler vs. Court of Appeals, G.R. No. 50076, September 14,
1990. 39 -- Compare with the case of Fortune Express, Inc. vs. Court of Appeals, G.R. No. 119756, March
18, 1999 where a bus operator was liable for the death and injuries of its passengers due to hijacking for
failure to observe extraordinary diligence.
https://jurisdoctor1a.wordpress.com/2019/04/03/chapter-1-general-provisions-2/Article 1165, Civil
Code of the Philippines 14 -- Article 1163, Civil Code of the Philippines. 15 -- Article 1166, Civil Code of
the Philippines. 16 -- Article 1170, Civil Code of the Philippines. 17 -- Article 1167, Civil Code of the
Philippines. 18 -- Refer to Articles 2199-2201 of the Civil Code of the Philippines.
21 -- Northwest Airlines, Inc. vs. Cuenca, G.R. No. L-22425, August 31, 1965.

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Self-Check MT 8.1.1
1. In this the debtor must perform one of several alternatives, choice belongs to debtor UNLESS
expressly given to creditor.
2. The obligation wherein various things are due, but the payment of one of them is sufficient,
determined by the choice which as a general rule belongs to the debtor (Luna).
3. The one that which would not prevent the obligation from being fulfilled despite the lapse of
the same in accordance with the rules governing delay or mora.
4. The period when fixed by a competent court, the period can no longer be judicially changed
(Art. 1197, par. 3).
5. This all prestations must be performed to extinguish obligation.
6. The fulfillment is demandable at once but it is extinguished or terminated upon the arrival of the
day certain or expiration of the term.
7. This is when from the nature or circumstances, it can be inferred that a period was intended
8. This is understood to be that which must necessarily come, although it may not be known when
9. The interval of time, which exerting an influence on an obligation as a consequence of a juridical
act, either suspends its demandability or produces its extinguishment.
10. This is a one principal prestation but one or more substitutes, choice belongs to DEBTOR ONLY.

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Answer Key MT 8.1.1
1. Alternative
2. Alternative Obligation
3. Ordinary
4. Judicial term or period
5. Conjunctive
6. Resolutory
7. Tacit
8. A day certain
9. Term or Period
10. Facultative

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Instructor
STUDENT NAME: __________________________________ SECTION: __________________
WRITTEN WORK MT-8.1.1

WRITTEN WORK TITLE: PROBLEM
WRITTEN TASK OBJECTIVE: The learners independently answer the questions discuss below and
explain the topics discuss above..
MATERIALS:
 Pen and Paper

TOOLS & EQUIPMENT:
 None
ESTIMATED COST: None
INSTRUCTION : Discuss your answers in essay form in the following questions base on the
topics discuss above.
1. What are the limitations on the rights of a choice of the debtor in alternative
obligations? Illustrate one such limitations.
2. Given the situation when the debtor is given the option either to exercise his right
of choice or to rescind the contact with damages.
3. State the legal effects in the case:
(a) Some of the objects of the obligations are lost through the fault of the debtor
who has the right of choice.
(b) All are lost through his fault.
PRECAUTIONS:

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Instructor
 None
ASSESSMENT METHOD: WRITTEN WORK CRITERIA CHECKLIST
STUDENT NAME: __________________________________ SECTION: __________________
WRITTEN OUTPUT CRITERIA CHECK LIST MT 8.1.1
SCORING
CRITERIA
Did I . . .
1 2 3 4 5
1. Focus - The single controlling point made with an awareness of task

about a specific topic.
2. Content - The presentation of ideas developed through facts, examples,
anecdotes, details, opinions, statistics, reasons and/or opinions
3. Organization – The order developed and sustained within and across
paragraphs using transitional devices and including introduction and
conclusion.
4. Style – The choice, use and arrangement of words and sentence
structures that create tone and voice.
5. Conventions – Grammar, mechanics, spelling, usage and sentence
formation.
TEACHER’S REMARKS:  QUIZ  RECITATION  PROJECT
GRADE:
5 - Excellently Performed
4 - Very Satisfactorily Performed
3 - Satisfactorily Performed
2 - Fairly Performed
1 - Poorly Performed

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Instructor
_______________________________
TEACHER
Date: ______________________

8 Meeting
Instructor

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Section 2 - Obligations With A Period The Law On Obligations and Contract Section 2 - Obligations With A Period

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Unit Section 2 – Obligations with a Period

Module The Law on Obligations and Contract Page |1

INFORMATION SHEET MT 8.1.1

Sec. 2 – Obligations with a Period

Term or Period- interval of time, which exerting an influence on an obligation as a consequence of a

Obligations with a period- obligations whose demandability or extinguishment is subject to the

INFORMATION SHEET MT 8.1.2

Effect of Term or Period

Effect of Fortuitous Event

This is only applicable to obligations to give a determinate thing.

Effect of Advance Payment or Delivery

PREPARED BY: APPROVED BY:

INFORMATION SHEET MT 8.1.3

There is no recovery (Tolentino)

Benefit of Term or Period

Term is for the benefit of both parties (Presumption)

Term is for benefit of creditor only (Exception)

Term is for benefit of debtor only (Exception)

Why a creditor cannot be compelled to accept payment

PREPARED BY: APPROVED BY:

INFORMATION SHEET MT 8.2.1

General Rule: Courts are without power to fix period

Cannot be applied to:

Steps/Nature of the Action

Two Ultimate Facts:

PREPARED BY: APPROVED BY:

INFORMATION SHEET MT 8.2.2

Extinguishment of debtor’s Right to Period

There is a difference between effects of impairment and effects of disappearance

PREPARED BY: APPROVED BY:

Section 3 – Alternative and Facultative Obligations

PREPARED BY: APPROVED BY:

INFORMATION SHEET MT 8.3.1

Exceptions/ Limitations on the Right to Choose by the Debtor (IEx-IOU-OP-PFB)

PREPARED BY: APPROVED BY:

INFORMATION SHEET MT 8.3.2

Tacit declaration may be seen (PAS):

PREPARED BY: APPROVED BY:

INFORMATION SHEET MT 8.3.3

Effect of Choice (LCI)

Error as to the Obligation

PREPARED BY: APPROVED BY:

PREPARED BY: APPROVED BY:

PREPARED BY: APPROVED BY:

Answer Key MT 8.1.1

PREPARED BY: APPROVED BY:

STUDENT NAME: __________________________________ SECTION: __________________

WRITTEN WORK MT-8.1.1

 Pen and Paper

PREPARED BY: APPROVED BY:

STUDENT NAME: __________________________________ SECTION: __________________

WRITTEN OUTPUT CRITERIA CHECK LIST MT 8.1.1

1. Focus - The single controlling point made with an awareness of task

PREPARED BY: APPROVED BY:

PREPARED BY: APPROVED BY:

PREPARED BY: APPROVED BY:

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STUDENT NAME: ________________ SECTION:

STUDENT NAME: ________________ SECTION: