I.

Define or give the meaning of the following: (2pts each)

a. Condition - it is a future and uncertain event, upon the happening of which, the effectivity or
extinguishment of an obligation or right subject to it depends
b. Civil loss - it is when a thing disappears in such a way that its existence is unknown or even if
known, it cannot be recovered
c. 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.
d. Pure Obligation - it is one which is not subject to any condition and no specific date is mentioned
for its fulfillment and is, therefore, immediately demandable.
e. Potestative Condition - it is which depends upon the sole will of one of the contracting parties

II. Discussions

1. Illustration an obligation subject to:

a. suspensive condition

Where an obligation is subject to a suspensive condition, the obligation's creation is conditional

on the absence of an event or the certainty that it will not occur. The demandability of the obligation is
postponed until the condition's unpredictable occurrence, and the condition suspends the existence of a
relationship between the parties.

b. resolutory condition

If an obligation is subject to a resolutory condition, that means that if it is fulfilled, it will

terminate an actual obligation or right. The continuation of such a contract is predicated on the
occurrence of an unknown future case. However, as is implied in all commutative arrangements, it
grants the parties the freedom to return to their original positions.

2. Give 2 cases when the conditional obligation is valid although the condition depends entirely
upon the will of the debtor. Explain (5pts.)

The first instance, in which the conditional obligation is valid despite the fact that the condition
is completely dependent on the debtor's will, is where the debtor agrees to pay when her means allow
it. In this situation, the period of time over which the debtor is capable of repaying the debt, rather than
whether or not she will comply, is determined by the debtor's will.

The next instance in which a conditional commitment is valid despite the fact that the condition
is solely dependent on the debtor's will is whether the debtor is capable of performing the obligation.
 3. May an obligor be liable under an obligation subject to a suspensive condition although the
condition has not yet been fulfilled? Explain. (5 pts.)

If an obligation is subject to a suspensive condition, the obligation occurs only after the
condition is fulfilled. As a result, the obligor is not yet responsible in this circumstance. If the obligation
has already been fulfilled, the obligor will be held accountable.

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? (5 pts.)

If a seller has an obligation to give a parcel of land subject to a suspensive condition, the seller
has the freedom to retain any fruits and interests she may have earned during the condition's pendency,
unless the seller demonstrates a different desire and agrees to make an accounting of fruits received
during the condition's pendency.

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

a. is lost with the debtor's fault; without his fault;

If the thing to be delivered 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. But if the thing is lost without the
fault of the debtor, the obligation shall be extinguished.

b. deteriorates with the debtor's fault; without his fault

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. But when the
thing deteriorates without the fault of the debtor, the impairment is to be borne by the creditor.

III. Problems

Explain or state briefly the rule or reason for your answer.

1. D (debtor) borrowed 20,000 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? (5 pts.)

In this case, the conditional obligation, whose fulfillment is conditional on the debtor's will and
partly on the will of B, the third party, is perfectly valid. The creditor in this case demands that B pay him
by August 30th, but they agreed to B's agreement to pay the creditor if B so wants. As a result, if the due
date has not yet expired, the creditor cannot make a claim on the debtor

.
 2. Suppose in the same problem, D obliges himself to pay C 10,000 after C has paid his obligation
to T. Is the obligation valid? (5 pts.)

In this case, the debtor is obligated to reimburse the creditor if the creditor has already paid T's
third party/person. If the creditor has not yet fulfilled his obligation to T, he cannot expect immediate
payment from the debtor. If the creditor has not yet paid to T, the debtor is not obligated to pay the
creditor. As a result, the debtor's obligation is invalid.

3. S (seller) agreed to sell to B (buyer) a specific car for 200,000, delivery of the car and the
payment of the price to be made on June 15. Suppose S delivered the car on June 15 but B failed
to pay the price, what are the remedies of S? (5 pts.)

If the buyer fails to fulfill his payment obligations, the seller has two options: (1) take action for
clear fulfillment of the obligation with damages, or (2) take action for rescission of the obligation with
damages. The seller is only allowed to choose one of these remedies, not both. If the creditor has
chosen rescission, he cannot insist that the buyer meet his obligations. Similarly, if he chooses the buyer
to fulfill the contract, he would not be able to practice rescission later.

4. S sold a parcel of land to B for 240,000 payable in installments of 20,000 a year. The land was
delivered to B who obtained ownership thereof. After B had paid 200,000 he could no longer
continue paying in view of financial reverses but he was willing to pay the balance of 40,000 if
given more time. Thereupon, S sued for rescission under Art. 1191. If you were the judge, would
you grant rescission? (5 pts.)

If I were the judge, I would grant the seller in default a period of time to fulfill the buyer's
obligations. Given that the buyer is able to fulfill his liability to manage the 40,000 maintaining balance,
but needs more time due to his financial difficulties, not because he did not want to pay the maintaining
balance that he has left.

Obligations with a Period

IV. Discussions

1. Has the debtor the right to recover what he has paid to the creditor before the arrival of the
period agreed upon? Explain. (5 pts.)

Yes, but only if the debtor is unaware of the time and believes the duty has become demandable
immediately, according to Article 1195. As a result, the debtor has the right to reclaim what he has paid
to the creditor prior to the expiration of the agreed-upon term, as well as the fruits and rights. However,
the debtor will only reclaim the payment if it is made before the maturity date. Eventually, even though
the debtor is mindful of the time limit, he cannot retrieve the payment.
 2. If an obligation does not state a period for its performance, has a party the right to ask a court
to fix a period or the duration thereof? Explain.

Yes, however under Article 1197, the court cannot impose a duration if the obligation does not
provide for one. So, the court will only set a period if no period has been set but one was expected, or if
the duration of the period is determined by the debtor's will. To prevent the risk that the commitment
will never be fulfilled, the court set a deadline.

3. Give the cases when the obliges can demand the performance of an obligation even before the
arrival of the period agreed upon.

According to Article 1198, the obligee can demand the performance of an obligation even
before the arrival of the period agreed upon:

(1) Where the debtor becomes insolvent, which means that debtor is unable to fulfill or pay the
contract unless a collateral is pledged as a guarantor and the debt is insured. Insolvency must
occur after a contract has been signed.
(2) When the debtor retains his right to the period if the debtor fails to have the guaranties or
securities offered, which means the debtor fails to protect her debt or show collateral to the
creditor.
(3) When guaranties or securities issued have been impaired or vanished, that is when the security
was lost due to the debtor's negligence, and when it was destroyed due to a fortuitous incident,
the debtor must exchange the item with one of equal value.
(4) When the right to the time would be lost if the debtor violates an undertaking, that is, if the
debtor does not fulfill his undertaking.
(5) If a debtor tries to avoid his obligation by absconding, his right to the period is forfeited.

V. Problems

Explain or state briefly the rule or reason for your answer.

4. D (debtor) borrowed 10,000 from C (creditor) at 15% interest per annum payable on December
31. Can D require C to accept payment before December 31? (5 pts.)

Since, as specified in Article 1196, the time is designated for the good of both the debtor and the
creditor, the debtor cannot ask the creditor to approve payment before December 31. In other terms,
neither the debtor nor the creditor will force the creditor to accept payment. Within this case, however,
the debtor will pay the creditor 10,000 plus one year's interest if the creditor agrees to approve the
settlement before the due date.

5. D binds himself to give 10,000 to C upon the death of the father of D. Is the obligation of D
conditional or one with a period? (5 pts.)

According to Article 1193, paragraph 3, a day definite is understood to be one which would actually
come regardless of when it might be identified. D's father's death date is uncertain at this time, although
it will undoubtedly occur. Apart from a conditional one, it is characterized by the fact that it is an
unpredictable case, meaning it may or may not occur.