LAW ON OBLIGATIONS

BS LM - 1BLM | Atty. Karlo Antonio | 2nd Semester ALP-BLM

The law on obligations is the foundation of civil law.
● Many laws govern certain aspects of obligations e.g.,
Civil Code, Revised Penal Code, and the Constitution
for the law on obligations
○ Non infringement laws, non suability of the
State, Bill of Rights
Essential elements of obligation
a. Juridical tie or vinculum juris
● Efficient cause established by the various sources of
obligations
● Refers to the source of obligation; what binds the
parties to fulfill the obligation
● The obligation must be rooted on something valid

ARTICLE 1156
An obligation is a juridical necessity to give, to do or not to do.
EXAMPLE 1.3: Between the State and the taxpayers, the juridical
tie is the law. Between a buyer and a creditor, the juridical tie is
a contract. Between an assailant and a victim, the juridical tie
is the delict.

b. Object

Juridical Necessity ● Prestation or the particular conduct required to be

Legal Cannot be avoided and observed by the debtor (to give, to do, or not to do)
needs to be done as ● EXAMPLE 1.3: Prestation not to do: NDAs of
non-compliance has entertainment agencies and of government agencies
sanctions and penalties for their resigning employees to not divulge
confidential information
Juridical Necessity
A civil obligation can be compelled*
c. Active subject (called obligee or creditor)
● Person who can demand the fulfillment of the
*But then again, not all civil obligations can be compelled,
obligation
particularly if it requires a party to perform a particular
● Whom someone is owed
service, as it violates constitutional rights against involuntary
servitude
d. Passive subject (called obligor or debtor)
● The person from whom the obligation is juridically
EXAMPLE 1.1: If the seller fails to deliver and the buyer forces the
demandable
seller to fulfill his obligation, is it legal?
● Who owes something to give, do, or not to do for the
● No. The only remedy for it is to enforce it in court that
creditor
they may render a judgment to compel the other
person to fulfill their obligation
● The distinction between the active and passive
subjects are viewed from the perspective of who has
EXAMPLE 1.2: Sarah Geronimo was contracted to perform in
the right to demand the performance of the
San Beda University, but she changed her mind.
obligation
● You cannot force her to perform, but you can sue her
for damages.
ARTICLE 1157
EXAMPLE 1.3: If you commit murder will there be an obligation
on the part of the accused or the murderer? Obligations arise from:
● Yes, there will be an obligation. (1) Law;
● There is always damage if there is murder as you take (2) Contracts;
a human life (3) Quasi-contracts;
● Murder = civil liability because it is an act punishable (4) Acts or omissions punished by law; and
by law i.e., RPC (5) Quasi-delicts

● Enumerated Source of Obligation, Exclusive – The
enumeration of the sources of obligations are
exclusive. No obligation exists if its source is not one of
those enumerated in Art. 1157 (Navales vs. Rias, 8 Phil.
508)
● Generally emanating from law and private acts.
● Private acts include licit acts (i.e., contracts,
quasi-contracts) and illicit acts (i.e., delicts,
quasi-delicts).
● Contracts are results of bilateral actions as it requires
consent. Other sources are results of unilateral
actions.
ARTICLE 1158
Obligations derived from law are not presumed. Only those
expressly determined in this Code or in special laws are
demandable, and shall be regulated by the precepts of the
law which establishes them; and as to what has not been
foreseen, by the provisions of this Book.
● In the birth of an obligation, there is always a
concurrence between the law which establishes or
recognizes it and an act or condition upon which the
obligation is based or predicated
● The law by itself establishes the obligation and not
merely guarantees the compliance and
demandability of the obligation
● EXAMPLE 1.4: Paying tax, provisions about marriage
Obligations arising from contracts have the force of law
between the contracting parties and should be complied with
in good faith.
● A contract is the meeting of minds between two
persons whereby one binds himself, with respect to
the other, to give something or render some service
(Art. 1305, NCC)
● The bedrock of contract is consent, hence it is always
voluntary
● Consensual contracts, which are perfected by mere
consent, and real contracts, which require the
delivery of the object of the obligation
● Whether the contract is consensual or real, the rule is
that from the moment it is perfected, obligations
which may be either reciprocal or unilateral arise
● Reciprocal are obligations where the parties are
mutually obliged to do or give something, or
unilateral where only one of the parties (obligor) is
obliged to do or give something
● Compliance in good faith means performance in
accordance with the stipulations, clauses, terms, and
conditions of the contract. Good faith must therefore
be observed to prevent one party from taking unfair
advantage over the other party.
ARTICLE 1160
Obligations derived from quasi-contracts shall be subject to
the provisions of Chapter 1, Title XVII, of this Book.

Difference of obligation from law and acts punished by law

Acts punished by law
From the commission of the
act or omission . if you do
not do it, then you are not
liable. The law does not
create the obligation, but
your creation of the crime. It
depends on you to have an
obligation. The law does not
tell you what to do; it tells
you that this will happen if
you do this
: consideration (reason why you enter the contract,
ARTICLE 1159
Law
Imposed upon you
regardless if you ; it is a
blanket obligation
independent of your actions
Acts are not independent
and will only exist depending
on the acts or omissions
Quasi-
● Shares certain features of a contract but not all which
would have made it a contract
● “Partly” or “apparently” a contract
Quasi contracts
● Certain lawful, voluntary, unilateral acts give rise to
the juridical relation of quasi-contract to the end that
no one shall be unjustly enriched at the expense of
another (Art. 2142)
● It is a quasi contract because no one is forced to
comply and there is acceptance
● There is no consent (meeting of minds) and
e.g., performance of obligation of the seller, you
expect to fulfill the obligation)

What makes a quasi-contract a quasi-contract?
● It is a quasi contract because no one is forced to
comply
● There is subsequent acceptance
○ Not sufficient because a) there is no
perfection or the meeting of minds as there
is no offer
● There is no offer but you received benefits
○ Implied acceptance: impliedly accepting
but not refusing and benefiting from the
offer
● As there is unjust enrichment, you must reimburse for
the benefits you have received
Characteristics of quasi-contracts
1. Arises from a lawful act, which distinguishes it from a
delict and quasi-delict
2. Arises from a voluntary act, which distinguishes it
from a culpa criminal and a culpa aquiliana which
are both committed through negligence
3. Arises from a unilateral act, which distinguishes it
from a contract that requires consent from both
parties
Negotiorum gestio
● A person (gestor or officious manager) voluntarily
takes charge of the agency or management of the
business or property of another without any power or
authority from the latter
● Governing the management of another person’s
affairs
● Chief element is the principal’s absence or inability to
appoint a proper agent
Requisites for negotiorum gestio
● The gestor or officious manager must voluntarily
assume the agency or agreement of the business or
property of another
● The business or property must be either neglected or
abandoned
● The management must not be authorized by the
owner
● Good faith on the part of the gestor
Obligations in negotiorum gestio
a. On the part of the officious manager or gestor
● He cannot just quit once he intervenes. The law
requires him to continue until the termination of the
affair and its incidents or until the owner appears and
substitutes him in such management.
● Observe the diligence of a good father of a family
● Becomes liable to the owner should the latter suffer
damages
● May delegate some or all of his duties to another but
is still liable
● Not liable for damages by reason of fortuitous event
● Liable for contracts entered into with third parties
b. On the part of the owner
● Liable to the gestor for obligations incurred in his
interest, necessary and useful expenses, and
damages suffered by the gestor in the performance
of his duties
Extinguishment of negotiorum gestio
1. Repudiation of the officious management by the
owner
2. Putting and end to such
3. Death, civil interdiction, insanity, or insolvency of the
owner or gestor
4. Withdrawal from the management
Solutio indebiti
● Whenever a person unduly delivers a thing through
mistake to another who has no right to demand it
● Premise is to avoid unjust enrichment
● Out of justice and equity, return what you have
received
Elements of solutio indebiti
● There must be a payment or delivery made by one
person to another
● The person who made the payment or delivery was
under no obligation to do so
● The payment or delivery was made by reason of
mistake
Obligations in solutio indebiti
● Obligation to return arises
● Recipient of the payment is exempt from obligation to
restore if:
a) He believed in good faith that the payment
was of a legitimate claim
b) Destroyed the document, allowed the action
to prescribe, gave up the pledges, or
canceled the guarantees of his right
● Obligation to pay legal interest if a sum of money is
involved, if he acted in bad faith
Other examples of quasi-contracts:
EXAMPLE 1.5: A physician is obliged to tend to and give
appropriate treatment even with unconscious patients
brought to the hospital. Consequently, the latter is liable for the
services of the physician even if he has not given consent to
the treatment, as a principle that “no man shall be unjustly
enriched at the expense of another”
ARTICLE 1161
Civil obligations arising from criminal offenses shall be
governed by the penal laws, subject to the provisions of article
2177, and of the pertinent provisions of Chapter 2, Preliminary
Title, on Human Relations, and of Title XVIII of this Book,
regulating damages.
● Every person liable for a felony is also civilly liable (Art.
100, RPC); the former aspect affects social order and
the latter affects private rights
● Civil liability can only be extinguished if the person
accused and acquitted is not the perpetrator
● Death of the accused during the pendency of his
appeal and before the finality of his judgment
extinguishes criminal liability
● Only legislative acts can penalize acts or omissions.
An act from the Congress must expressly prohibit the
act
EXAMPLE 1.6: PRRD verbally announced that students vaping
outside of school is not allowed. You can still vape because
there is no legislative act that prohibits such.
As a general rule, a delict has dual liability.
Criminal liability
● Criminal cases are entitled as “People of the
Philippines”, hence they are the ultimate
character/victim of the case
● Criminal cases are executed in the name of the
sovereign, which is the Filipino people
● The sovereign can prohibit acts. For instance, a king in
a monarchy can penalize or push for an act. In a
democratic republican country, the representatives in
a legislation can do so.
Civil liability
● The victim is another character, albeit they are not
the ultimate character; you owe civil liability
● Owed to private individuals, particularly the victims of
your crime
Not all crimes have two liabilities.
EXAMPLE 1.7: If you are caught possessing shabu, you are:
● Criminally liable to the People of the Philippines as
enacted in the Dangerous Drugs Act
● No civil liability because there is no victim
● There are crimes that are victimless
EXAMPLE 1.8: If you are caught not wearing a seatbelt, you are
not civilly liable because there is no victim.
When will criminal liability affect civil liability?
● Criminal liability does not affect civil liability because
it is owed to another party/creditor, and must be
proven by another standard (the latter carries a
lighter burden: preponderance of evidence)
● Acquittal of the court for criminal liability is not a
be-all-end-all; the victim may still file for civil action
for damages
● Preponderance of evidence
● However, if the court acquits you on the basis that you
were not guilty beyond a reasonable doubt, it does
not mean that you are guilty of nothing. You should
be proven guilty on the strength of the evidence of
the prosecution
● Res judicata: you cannot file for civil action anymore
as the case has been adjudicated by the Court
○ Litigation must end somewhere
ARTICLE 1162
Obligations derived from quasi-delicts shall be governed by
the provisions of Chapter 2, Title XVII of this Book, and by
special laws.
Whoever by act or omission causes damage to another, there
being fault or negligence, is obliged to pay for the damage
done. Such fault or negligence, if there is no pre-existing
contractual relation between the two parties, is called a
quasi-delict (Art. 2176)
● A juridical relation is created by virtue of which the
injured person acquires a right to be indemnified and
the person causing the damage is charged with the
corresponding duty to repair the damage
● Given that an act or omission may produce two
distinct sources of obligations— delicts or
quasi-delicts— the law prohibits the plaintiff to
 recover damages twice for the same act or omission has two sources of obligations: quasi delict or contract. Either
of the defendant case, double recovery is not allowed. Double recovery enables
unjust enrichment.
Requisites of quasi-delict:
1. An act or omission Doctrine of vicarious liability (Art. 2180)
2. No pre contractual relation between the contracting ● Liability can be demanded not only from the
parties (Does not matter anymore) negligent person, but also from others who are
3. Damage suffered by plaintiff presumed to be responsible for their care and
4. Fault or negligence by defendant well-being, such as parents to their minor children
5. Connection between damage and fault ● The following can be liable for their negligence:
○ Father and mother for their minor children
Similarities of delicts and quasi-delicts ○ Guardians for minors or incapacitated
1. There is an act or omission persons under their authority
2. A victim ○ Owners and managers of an enterprise for
3. Morally reprehensible. their employees
○ Employers for their employees
○ State for their special agents
Delict Quasi-delict
○ Teachers or heads of establishments of arts
Affects public interest Of private concern and trades for pupils and students or
apprentices
Penal Code to punish or Civil Code to repair
correct the act damages
ARTICLE 1163
Punished only if there is a Any kind of negligence or
penal law that punishes it fault intervenes
Every person obliged to give something is also obliged to take
care of it with the proper diligence of a good father of a family,
Difference of fault and negligence
unless the law or the stipulation of the parties requires another
standard of care.
Fault (culpa) Negligence (dolo)

Intentional; there is intent to
cause damage
Presupposes that there was Classifications of obligations from the point of view of its
no intent, but even with lack
object or prestation
of skill or lack of foresight,
you did it anyway
Real Personal
Any reasonably prudent
person would be cautious of Consists in giving Consists in either doing or
their actions not doing

Involves the delivery of a Includes all kinds of work or

EXAMPLE 1.9: A tortious interference, where a third person movable or an immovable service (to do), or consists in
inducing another to breach a contract has fault but it is not thing in order to create a abstaining from such acts
real right, or for the use of (to not do)
penalized by law, hence it is a quasi-delict
the recipient, or for its simple
possession, or in order to
EXAMPLE 1.10: If there is a breach of contract, it can still be
return it to its owner
considered as a quasi-delict: culpa contractual

Classifications of real obligations

Culpa aquiliana: no pre contractual relationship
Culpa contractual: intentional breach of contract
Specific or determinate Generic or indeterminate
It is possible to commit a quasi-delict which is the very act
that breaches the contract. A person who breached a contract Particularly designated or Delivering any member of a

physically segregated from genus or class
all others of the same class
Classifications of personal obligations
Positive Negative
Obligation to do Obligation not to do
● The accessory obligation to preserve is not applicable
to indeterminate things; the debtor may deliver any
member of the genus of the thing
Principal obligation of the debtor: Deliver the specific thing
due
Accessory obligations:
1. To preserve the thing to be delivered
2. Deliver the fruits, if the creditor is already entitled to
them
3. Deliver the accessions and accessories
● The debtor must deliver the very thing promised, in
accordance with Art. 1244, NCC: The debtor of a thing
cannot compel the creditor to receive a different one,
although the latter may be of the same value as, or
more valuable than that which is due.
Proper diligence of a good family
● Bonus pater familias in Roman law
● Refers to the diligence required of a reasonably
prudent person
● The parties can validly agree even on a standard of
lower care following the rule that the agreement of
the parties is the law between them
● It is also lawful for the parties to require extraordinary
care and even liability by reason of fortuitous event
ARTICLE 1164
The creditor has a right to the fruits of the thing from the time
the obligation to deliver it arises. However, he shall acquire no
real right over it until the same has been delivered to him.
When is the obligation to deliver the determinate thing due
deemed to have arisen?
● Depends on the source of the obligation
● Specific provisions applicable to determine the time
when the obligation to deliver arises govern
obligations sourced from law, quasi-contracts,
quasi-delicts, and delicts
● The perfection of the contract determines the time of
the obligation to deliver in accordance with Art. 1315,
NCC: “Contracts are perfected by mere consent, and
from that moment the parties are bound not only to
the fulfillment of what has been expressly stipulated
but also to all the consequences which, according to
their nature, may be in keeping with good faith,
usage, and law.”
○ Exception: obligation to deliver is subjected
to a suspensive condition wherein the
obligation does not come into existence until
after the condition is fulfilled
● The provision speaks only of the birth of the obligation
and not of its demandability
Personal right Real right
Power of one person to Power belonging to a person
demand of another, as a over a specific thing, without
definite passive subject, the a passive subject
fulfillment of a prestation individually determined,
against whom such right
may be personally exercised
● The creditor acquires a real right over a thing only
upon its delivery and this principle applies not only to
the specific thing due, but also to its fruits.
● Non nudis pactis, sed traditione dominia rerum
transferuntur; The ownership of things is transferred
not by mere agreement, but by tradition or delivery
● Prior to the delivery, the creditor over the determinate
thing is a personal right, which is the right to demand
from the debtor the delivery of the determinate thing
due and its fruits
EXAMPLE 1.6: Contract of sale
● Ownership of the vendee only starts from the moment
it is delivered. Sale itself does not transfer or affect
ownership; the most that sale does is to create the
obligation to transfer ownership.
ARTICLE 1165
When what is to be delivered is a determinate thing, the
creditor, in addition to the right granted him by article 1170,
may compel the debtor to make the delivery.
If the thing is indeterminate or generic, he may ask that the
obligation be complied with at the expense of the debtor.
If the obligor delays, or has promised to deliver the same thing
to two or more persons who do not have the same interest, he
shall be responsible for any fortuitous event until he has
effected the delivery.
● The first paragraph expressly grants the creditor to
recover damages against the debtor
● The second paragraph gives a remedy to the creditor,
wherein if the debtor is not able to deliver the thing,
the obligation may be performed by someone else at
his expense
● The last paragraph accounts for another standard of
care
● The action to compel delivery is only for a specific
performance
ARTICLE 1166
The obligation to give a determinate thing includes that of
delivering all its accessions and accessories, even though they
may not have been mentioned.
Accessories
● Things which being intended for the ornamentation,
use, or preservation of another of more importance,
have for their object the completion of the latter for
which they are indispensable or convenient
Accessions
● Everything that is produced by a thing and all those
incorporated or attached thereto, either naturally or
artificially
ARTICLE 1167
If a person obliged to do something fails to do it, the same
shall be executed at his cost.
This same rule shall be observed if he does it in contravention
of the tenor of the obligation. Furthermore, it may be decreed
that what has been poorly done be undone.
● The debtor cannot be compelled against his will to
execute the act which he bound himself to do as
doing so will amount to involuntary servitude
● The only remedy of the creditor is an action for
damages against the debtor, and that the act be
done by persons other than the debtor
ARTICLE 1168
When the obligation consists in not doing, and the obligor does
what has been forbidden him, it shall also be undone at his
expense.
● However, when the undoing of what has been done in
violation of the prohibition already becomes
impossible, either physically or legally, the only
feasible remedy of the creditor is to recover damages
from the debtor
ARTICLE 1169
Those obliged to deliver or to do something incur in delay from
the time the obligee judicially or extrajudicially demands from
them the fulfillment of their obligation.
However, the demand by the creditor shall not be necessary in
order that delay may exist:
(1) When the obligation or the law expressly so declare; or
(2) When from the nature and the circumstances of the
obligation it appears that the designation of the time when the
thing is to be delivered or the service is to be rendered was a
controlling motive for the establishment of the contract; or
(3) When demand would be useless, as when the obligor has
rendered it beyond his power to perform.
In reciprocal obligations, neither party incurs in delay if the
other does not comply or is not ready to comply in a proper
manner with what is incumbent upon him. From the moment
one of the parties fulfills his obligation, delay by the other
begins.
Delay or default (mora)
● Non-fulfillment of the obligation with respect to time
 a. Mora solvendi
1156 Definition of obligation
● Default on the part of the debtor to perform by reason
of a cause imputable to the deb tor, or because of 1157 Sources of obligations
dolo (malice) or culpa (negligence)
● May only apply in positive obligations (to give and to 1158 Law as a source

do), and not in negative obligations

1159 Contract as a source

b. Mora accipiendi 1160 Quasi-contract as a source

● Default on the part of the creditor to receive or accept
the performance of the obligation by the obligor 1161 Delict as a source

1162 Quasi-delict as a source

c. Compensatio morae
● Default of both parties in reciprocal obligations 1163 Proper diligence
● Reciprocal obligation - arising from the same cause,
and wherein each party is a debtor and a creditor of 1164 Creditor’s real right
the other (e.g., contract of sale)
1165 Determinate, indeterminate thing
● Delay by the other begins only from the moment one
of the parties fulfills his obligation. Any claim of delay 1166 Accessories and accessions
against the other could prosper only if the
complaining party had faithfully complied with its 1167 Obligation to do
own correlative obligation.
1168 Obligation not to do

● The demand may be in any form provided that it can

1169 When to demand
be proved, and the proof of this demand lies upon the
creditor
● If no demand was made, then the loan has not yet
become due and demandable, and any foreclosure
of property used as collateral for the loan would be
considered premature
● Absent any demand from the obligee, oral or written,
the effects of default do not arise, and the obligor
does not incur delay, as a rule

Exceptions to when demand is no longer needed

EXAMPLE 1.6: A partner who has undertaken to contribute a

sum of money fails to do so. The law expressly says that the
partner concerned thereby becomes a debtor of the
partnership for the interest and damages from the time he
should have complied with his obligation.
EXAMPLE 1.7: In a case of double sale where the second buyer
has acquired a movable property in good faith, the first buyer
can hold the seller liable for damages for breach of the
obligation. The seller shall incur in delay immediately after the
lapse of the period agreed upon for the delivery of the thing as
demand would already be useless considering that the seller
has rendered the obligation beyond his power to perform.

PROVISION LIST
2/23 3/9

If you commit murder will there be an obligation on the part of JDC is obligated to deliver his Toyota Fortuner with plate
the accused or the murderer? number ABC12345 to PDG. Is he obligated to take care of his
- Yes, there will be an obligation. car?
- Self-defense: no crime in the eyes of the law - Yes Art. 1163
- There is always damage if there is murder as you take
a human life What is the diligence required?
- Murder = civil liability because it is an act punishable - Good father of a family
by law i.e., RPC
Who is a good father of a family? Why is he the standard use?
Difference of obligation from law and acts punished by law - He is expected to provide for the necessities of the
- Delicts: from the commission of the act or omission . if family
you do not do it, then you are not liable. The law does
not create the obligation, but your creation of the If it is the diligence of a good mother of a family?
crime. It depends on you to have an obligation. The -
law does not tell you what to do; it tells you that this
will happen if you do this Where do we find extraordinary diligence?
- Law: imposed upon you regardless if you ; it is a - Contracts of carriages
blanket obligation independent of your actions - Banks
- Segregating trash is an obligation independent of
your actions (law) Should a parent exercise extraordinary diligence?
- Acts are not independent and will only exist
depending on the acts or omissions Is the

What are obligations arising from contracts? May kontrata si Juan kay Pedro. Magdedeliver siya ng
- Art. 1159 sasakyan plate number abc123. Idedeliver yun ng march 12 kay
- Contract as the meeting of the minds (Art. 1305) Pedro. On march 10, the car was wrecked. Is he liable for
- Agreements between parties damages?
- He is liable because he failed to take care of it with
What is quasi-? the proper diligence of a good father of a family as
● Shares certain features of a contract but not all which stated in art 1163
would have made it a contract
● “Partly” or “apparently” a contract Can he replace it with another car?
- No
What makes a quasi-contract a quasi-contract?
- What if the object was a kilogram of apples?
-
Example of solutio indebiti: returning excess change
- Premise is to avoid unjust enrichment
- Out of justice and equity, return what you have
received

Premise of negotiorum gestio: prevent unjust enrichment as

someone went out of their way to protect the property you
have neglected or abandoned (negoshorom dyescho)

Person who voluntarily manage the property must continue to

protect or manage the property; it is a dual edged sword