Juridicial Tie

Debtor -> To give, to do or not to do -> Creditor or Obligee

Mr. A enters into a contract of sale with Mr. B who will purchase a car. Mr. A did not deliver the Car. Mr.
A is the passive subject or debtor and Mr. B is the active subject or creditor. The object or prestation is
the Car and the obligation to deliver is the legal tie or the vinculum juris which binds Mr. A and Mr. B.

On the other hand, if Mr. A, deliver the car and Mr. B did not pay, then Mr. B becomes the debtor who is
bound to pay while Mr. A is the creditor who has the right to demand the prestation.

Obligations vs Contracts

A contract is only one of the sources of obligation, while obligations have other sources like law, quasi-
contracts, delicts or quasi-delicts;

Contract is bilateral obligation while obligation is a unilateral obligation;

All contracts are obligations while not all obligations are contracts

Civil Obligations vs Natural Obligations

Civil obligations derive their binding force from positive law; natural obligation derives their binding
effect from equity and natural justice;

Civil can be enforced by court action of the coercive power of public authority;

Natural obligations, the fulfillment cannot be compelled by court action but depends on the good
conscience of the debtor.

Article 1157: Sources of Obligation

Art. 1157. Obligations arise from:

1) Law (obligations ex lege) – like the duty to pay taxes and to support one’s family.
2) Contracts (obligations ex contractu) – like the duty to repay a loan by virtue of an agreement.
3) Quasi-contracts (obligations ex quasi-contractu) – like the duty to refund an “over change” of
money because of the quasi-contract of solutio indebiti or “undue payment.”
4) Crimes or Acts or omissions punished by law (obligations ex malefi cio or ex delicto) – like the
duty to return a stolen carabao.
5) Quasi-delicts or Torts – (obligation ex quasi-delicto or ex quasi-malefi cio) – like the duty to
repair damage due to negligence

LAW

The provisions of Art. 1158 refers to the legal obligations or obligations imposed by specific provisions of
law, which means that obligations arising from law are not presumed and that to be demandable must
be clearly provided for, expressly or impliedly in the law. (Ex. Duty of spouses to support each other)

Contract
Contract as defined in Art.1305, NCC is the meeting of minds between two person whereby one binds
himself with respect to the other.

Obligations arising from contracts have the force of law between the contracting parties because that
which is agreed upon in the contract by the parties is the law between them, thus, the agreement
should be complied with in good faith. (Art 1159). (Example: A contract of lease was executed between
Mr. A as the lessee and Mr. B as the lessor for the rent of an apartment.

Quasi-Contracts

Quasi-contract is the juridicial relation resulting from a lawful, voluntary and unilateral act which has for
its purpose the payment of indemnity to the end that no one shall unjustly enrich or benefited at the
expense of another. (Art.2142, NCC)

Quasi Contracts vs Contracts

- In a contract, consent is essential requirement for its validity while in quasi-contract, there is no
consent as the same is implied by law;
- Contract is a civil obligation while quasi-contract is a natural obligation.

Delicts

- DELICTS or acts or omissions punished by law as a source of obligations. Acts or omission

punished by law is known as Delict or Felony or Crime.
- While an act or omission is felonious because it is punished by law, the criminal act gives rise to
civil liability as it caused damage to another.
- Civil liability arising from delicts:
- Restitution – which is the restoration of or returning the object of the crime to the injured party.
- Reparation – which is the payment by the offender of the value of the object of the crime, when
such object cannot be returned to the injured party Indemnification – the consequential
damages which includes the payment of other damages that may have been caused to the
injures party.

Quasi-Delict

- Quasi-delict is one where whoever by act or omission causes damage to another, there being
fault of negligence, is obliged to pay for the damage done. Such fault of negligence, if there is no
pre-existing contractual relation between the parties (Art. 2176)
- If Pedro drives his car negligently and because of his negligence hits Jose, who is walking on the
sidewalk of the street, inflicting upon him physical injuries. Then Pedro becomes liable for
damages based on quasi-delict.

Requisites of Quasi-Delicts

There must be fault of negligence attributable to the offended;

There must be damage or injury caused to another;

There is no pre-existing contract.

The enumeration by the law is exclusive, hence, no obligation exists if its source is not one of those
enumerated under Art. 1157

Article 1158

Art. 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.

This merely means that the obligation must be clearly (expressly or impliedly) set forth in the law (the
Civil Code or Special Laws). Thus, an employer is ordinarily not required to furnish his employees with
legal assistance, for no law requires this. Where a movie house guard, forced to defend himself in court
for killing a gate crasher, was acquitted but was not allowed to recover attorney’s fees from the theater
owner.) In case of overpayment of taxes, the National Gov’t cannot be required to pay interest on the
amount refundable in the absence of a statutory provision expressly directing or authorizing such
payment. (Collector of Int. Rev. v. Fisher, et al., L-11622 and L-11668, Jan. 28, 1961).

Article 1159

- Obligations arising from contracts have the force of law between the contracting parties and
should be compiled with in good faith.
- While obligations arising from a contract have the force of law between the parties, this does
not mean that the law is inferior to contracts. This is because before a contract can be enforced,
it must first be valid, and it cannot be valid if it is against the law. Moreover, the right of the
parties to stipulate is limited. Hence, Art. 1306 of the Civil Code says: “The contracting parties
may establish such stipulations, clauses, terms and conditions as they may deem convenient,
provided, they are not contrary to law, morals, good customs, public order, or public policy.”
- As long as Art. 1306 is compiled with, the contract should be given effect, even if at the time it
was entered into, no legal provision existed governing it.
- Neither party may escape their obligation under a contract, unless the other party assented
thereto, or unless causes sufficient in law and pronounced adequate by a competent court.
- In a validly made contract, some provisions were later on inserted by a falsifier.
- Is the whole contract void?
- HELD: Only the additional provision should be disregarded, and the original terms should be
considered valid and subsisting.

Innominate Contracts (contratos innominados)

Do ut des – I give that you may give.

Do ut facias – I give that you may do

Facio ut des – I do that you may give

Facio ut facias – I do that you may do.

Article 1160

Art. 1160. Obligations derived from quasi-contracts shall be subject to the provisions of Chapter 1, Title
XVII, of this Book.
Quasi-Contract

A quasi-contract is that juridicial relation resulting from a lawful, voluntary, and unilateral act, and which
has for its purpose the payment of indemnity to the end that no one shall be unjustly enriched or
benefited at the expense of another. (See Art. 2142, Civil Code).

Kinds of Quasi Contracts

1. Solutio Indebiti ( Payment by mistake)

It is the juridicial relation which arises when a person is obliged to return something received by him
through error or mistake.

Example- Arvin owed Ian the sum of P1,000.00. By mistake, Arvin paid P2,000.00. Ian has the obligation
to return the P1,000.00 excess because there was payment by mistake.

2. Negotiorum gestio (management of another’s property) it is the voluntary management or

administration by a person of the abandoned business or property of another without any
authority or power from the latter. (Art. 2144, NCC)

Example – Victor, a wealthy landowner suddenly left for abroad leaving his livestock farm unattended.
Ramon, a neighbor of Victor managed the farm thereby incurring expenses. When Victor returns, he has
the obligation to reimburse Ramon for the expenses incurred by him and to pay him for his services. It is
bases on the principle that no one shall enrich himself at the expense of another.

When during a fire, flood, or other calamity, property is saved from destruction by another person
without the knowledge of the owner, the latter is bound to pay the former just compensation. (Art.
2168, Civil Code).

Any person who is constrained to pay the taxes of another shall be entitled to reimbursement from the
latter. (Art. 2175, Civil Code).

Is a quasi-contract an implied contract?

-NO, quasi-contracts does not have meeting of the minds.

Article 1161

Art. 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 XVII of this Book, regulating damages.

Obligations arising from Crime ( Obligations Ex Delicto or Ex Maleficio)

Pertinent of the Revised Penal Code and other Penal Laws (Special Penal Laws) subject to the provisions
of Art. 2177 of the Civil Code

Human Relations (Civil Code Art. 18-36)

Title 18 of Book IV of the Civil Code on Damages (Art. 2195-2235)

 Article 1162

Art. 1162. Obligations derived from quasi-delicts shall be governed by the provisions of Chapter 2, Title
XVII of this Book, and by special laws.

Obligations Ex Quasi-delicts or Ex Quasi-Maleficio – Covered by Title 17 – Article 2176-2194.

Another name for Quasi Delicts is Tort or culpa aquiliana

Ex: - While driving a car recklessly, I injured a pedestrian

- While cleaning my window sill, my negligence caused a flower pot to fall on the street, breaking
the arms of my neighbor.

(NOTE: in the above examples, I can also be charged with the crime of physical injuries thru simple or
reckless imprudence.)

Negligence (Culpa)

- “Negligence is the failure to observe, for the protection of the interests of another person, that
degree of care, precaution, and vigilance which the circumstances justly demand, whereby such
other person suffers injury.” (U.S. v. Barrias, 23 Phil. 434).
- “The test in determining whether a person is negligent... is this: Would a prudent man (in his
position) foresee harm to the person injured as a reasonable consequence of the course about
to be pursued? If so, the law imposes a duty on the actor to refrain from that course, or to take
precaution against its mischievous results, and the failure to do so constitutes negligence.
Reasonable foresight of harm, followed by the ignoring of the admonition born of this provision,
is the constitute fact of negligence.” (Picart v. Smith, 37 Phil. 809)

Article 1163

Art. 1163. 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, unless the law or the stipulation of the parties requires
another standard of care

Duty to Exercise Diligence

- This article applies to the delivery of a determinate thing (as distinguished from a generic thing)
the duty to exercise proper diligence.
- The diligence required is diligence of a good father of a family.
- Diligence of a good father of a family means an ordinary care. Just like a father of a family, it is a
care that an average person would do in taking care of his property.
- However, if the law or contract provides for a different standard of care, said law or stipulation
must prevail.
- Case law states that the concept of diligence of a good father of a family “connotes reasonable
care consistent with that which an ordinarily prudent person would have observed when
confronted with a similar situation. The test to determine whether negligence attended the
performance of an obligation is: did the defendant in doing the alleged negligent act use that
reasonable care and caution which an ordinarily prudent person would have used in the same
situation? If not, then he is guilty of negligence.
 Article 1164

The creditor has as 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.

FRUITS

Article 442. Natural fruits are the spontaneous products of the soil, and the young and other products of
animals.

Industrial fruits are those produced by lands of any kind through cultivation or labor.

Civil fruits are the rents of buildings, the price of leases of lands and other property and the amount of
perpetual or life annuities or other similar income.

Example: A is obliged to give B on Dec. 3, 2004, a particular parcel of land. (Before Dec. 3, he has no right
whatsoever over the fruits). After Dec. 3, 2004, B, the creditor is entitled (as of right) to the fruits. But if
the fruits and the land are actually or constructively delivered only on Dec. 15, 2004, B becomes owner
of said fruits and land only from said date. Between Dec. 3 and Dec. 15, B had only a personal right
(enforceable against A); after Dec. 15, he has a real right (over the properties), a right that is enforceable
against the whole world.

Delivery and Ownership

- “Non nudis pactis, sed traditionis dominia rerym transferantur.” (As a consequence of certain
contracts, it is not agreement but tradition or delivery that transfers ownership).
- Ownership of the thing sold is a real right, which the buyer acquires only upon delivery of the
thing to him “in any of the ways specified in articles 1497 to 1501, or in any other manner
signifying an agreement that the possession is transferred from the vendor to the vendee. “This
right is transferred, not merely by contract, but also by tradition or delivery. Non nudis pactis
sed traditione dominia rerum transferantur. And there is said to be delivery if and when the
thing sold “is placed in the control and possession of the vendee. “Thus, it has been held that
while the execution of a public instrument of sale is recognized by law as equivalent to the
delivery of the thing sold, such constructive or symbolic delivery, being merely presumptive, is
deemed negated by the failure of the vendee to take actual possession of the land sold.

Kinds of Delivery

Actual Delivery (traditional) – where physically the property changes hands.

Constructive Delivery – that were the physical transfer is implied

- Traditio simbolica (symbolical tradition) – giving of keys of a house

- Traditio longa manu (delivery by mere consent or the pointing out of the object) – pointing out
the car, which is the object of the sale.
- Traditio brevi manu (delivery by the short hand; that kind of delivery whereby a possessor of a
thing not an owner, becomes the possessor as owner) – a lessee/tenant buys a property he is
renting.
- Traditio constitutum possessorium – the opposite of brevi manu; thus, the delivery whereby a
possessor of a thing as an owner, retains possession no larger as an owner, but in some other
 capacity – like a house owner who sells his house but continue to possess the property as a
tenant of the same house.
- Tradition by the execution of legal forms and solemnities (like the execution of a public
instrument selling a land).
- Art. 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 fortuitous event until has effected the delivery.

Classifications of Obligation (subject matter)

Real obligations (to give):

- To give a specific/determinate thing (set apart from a class);

- To give a generic or indeterminate (one of a class)

Personal Obligations

- To do
- Not to do

Specific or determinate things – it is capable of particular designation

- This car with plate number CUD-007

- The only car I have
- This notebook I bought last year

Generic or indeterminate things – when it refers only to a class, to a genus, and cannot be pointed out
with particularity.

- A car
- 2005 BMW car
- P5,000,000
- A kg of sugar
- A liter of beer

What will the creditor do if the debtor fails to comply with his obligations?

- Demand for specific performance

- Demand rescission or cancellation (abolition of a contract, and restore the parties to the
positions they would have been before the formation of the contract.)
- Demand damages with either of the first or second compliance.
Fortuitous Event

- An event of natural or human origin that could not have been reasonably foreseen or expected
and is out of the control of the persons concerned (as parties to a contract).
- Difference between a generic and a specific obligation is that, a specific obligation, that is, an
obligation to deliver a specific thing, is, as a rule, extinguished by a fortuitous event or act of
God. Upon the other hand, generic obligations are never extinguished by fortuitous events.
- A is obliged to give B this car. Before delivery, an earthquake destroys completely the car. The
obligation to deliver is extinguished.
- A is obliged to give B a book. Since this is a generic thing, even if one particular book is lost,
other books may take its place. Hence, the obligation is not extinguished (genus nunquam
perit**).

Obligor still liable

- If the obligor delays (default or mora)

- If the obligor is guilty of bad faith (for having promised to deliver the same thing to two or more
persons.)

Delay vs default (legal delay)

Ordinary delay is different from legal delay (default). Ordinary delay is merely non-performance at a
stipulated time; default is that delay which amounts to a virtual nonfulfillment of the obligation. (as a
rule, there must be demand, either judicially or extrajudicially before the debtor is in default).

A is obliged to give B his Jaguar car on Dec. 7, 2005. If on said day, A does not deliver, he is in ordinary
delay (not default). If on Dec. 8, 2005, an earthquake destroys the Jaguar car, A is not liable because the
obligation is extinguished.

If, however, on Dec. 8, demand was made for delivery, A would be in legal delay (default) and if later,
the car is destroyed by a fortuitous event, he would still be liable (in that the obligation to deliver the
lost specific thing is converted into a monetary claim for damages). (See Art. 1165, Civil Code). However,
if the car would have been destroyed at any rate even if no demand had been made, the amount of
damage would be reduced. (Art. 2215, No. 4, Civil Code).

Article 1166

Art. 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.

If I am obliged to deliver a particular car, I must also give the accessories (like the “jack”). If I am obliged
to deliver a piece of land, I must give also the accessions (like a building constructed thereon). (This is
true even if no mention of them was made in the contract.)
Accessories and Accessions

Accessories – those joined to or included with the principal for the latter’s better use, perfection, or
enjoyment. (Examples: the keys to a house, the dishes in a restaurant.)

Accessions – additions to or improvements upon a thing. These include alluvium (soil gradually
deposited by the current of a river on a river bank) and whatever is built, planted, or sown on a person’s
parcel of land.

(NOTE: Even if the windows of a building have been temporarily removed, they should still be included.)

A stipulation to exclude accessories and accessions is considered valid.

Article 1167

Art. 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.

Positive Personal Obligation (to do)

If the debtor fails to do, creditor may:

- Have the obligation performed (by himself or by another person) at debtor’s expense (only if
another can do the performance).
- And obtain damages. (if it cannot be done by any other person, only damages can be obtained.)

Unlike any other obligation, specific performance is not a remedy in personal obligations because this
is tantamount to involuntary servitude* which is in violation of the constitution**.