GENERAL PROVISIONS

Article 1156. An obligation is a juridical necessity to give, to do

or not to do.

A juridical relation between two persons, known as the creditor

and debtor, whereby the former can demand from the latter the
observance of a determinate conduct and in case of breach, may
obtain satisfaction from the assets of the latter.

Characteristics of an Obligation
1. It represent an exclusively private interest
2. It creates ties that are bound by nature transitory
3. It involves the power to make the juridical tie effective in case of
non-fulfillment through an economic equivalent obtained from
the debtor’s patrimony

Types of Obligation
1. Civil obligations – those which derive their binding force from
positive law and can be enforced by a court action or the
coercive power of public authority
2. Natural obligations – refer to those which derive their binding
force from equity and natural justice and its fulfillment cannot be
compelled by court action but depends exclusively on the
conscience of the debtor
3. Moral obligations – are those which arise from moral natural
law developed by the church and not enforceable in court. It
deals with the spiritual obligation of a person in relation to his
God and church

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 Elements of an Obligation
1. Active subject (creditor, obligee) – has the power to demand
the prestation; it is he who in his favor the obligation is
constituted, established or created; it is he who has the right to
demand
2. Passive subject (debtor, obligor) – one who is bound to
perform the prestation; passive because without the demand,
there will be no action, he has to wait for the demand from the
creditor. Has the juridical necessity of adjusting his conduct on
the demand of the creditor pursuant to the obligatory tie (NB: it
is not necessary that the active/passive subject – also known as
the personal elements of the obligation – be determinate at the
time of the constitution, but they must at least be determinable.
When the subject cannot be determined, the obligatory tie can
have no effect)
3. The object or the prestation – the object is not a thing but a
particular conduct of the debtor. It is the subject matter of the
obligation which has an economic value or susceptible to
pecuniary substitution in case of noncompliance)
4. Efficient cause or juridical tie between the two subjects –
the vinculum by which the debtor is bound to in favor of the
creditor to perform the prestation. It is determined by knowing
the sources of the obligation.
Kinds of Prestation
1. To give – consists of the delivery of a movable or immovable
thing which is either determinate or indeterminate. This is in
order to create a real right, or for the use of the creditor, or for its
simple possession, or in order to return to its owner
2. To do – involves all kinds of work or services whether physical
or mental, but in most cases the essence of the act may not be
such, but merely the necessity of concluding a juridical operation,
such as, when a person promises to give a bond
3. Not to do – a negative obligation which consists of abstaining
from some act, it includes “not to give’

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 Requisites of Prestation
1. It must be physically and juridically possible
2. It must be determinate or at least determinable according to pre-
established elements or criteria
3. It must have a possible equivalent in money or a peceuniary
value

Article 1157. Obligations arise from:

(1) Law
(2) Contracts
(3) Quasi-contracts
(4) Acts of omissions punished by law
(5) Quasi-delicts

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. (1090)

This refers to legal obligations or obligations arising from law.

They are not presumed because they are considered a burden upon
the obligor. They are the exception to the rule. To be demandable,
they must be clearly set forth in the law, i.e. the Civil Code or special
law.

Does not mean that law and human acts exclude each other
completely. The law cannot exist as a source of obligation, unless
the acts to which its principles may be applied exists. But once those
acts exist, the obligations arising from them by virtue of law are
entirely independent of the agreement of the parties

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 When the law merely acknowledges the existence of an
obligation generated by an act which constitutes a contract, quasi-
contract, delict or quasi-delict, and its only purpose is to regulate
such an obligation which did not arise from it, the act itself is the
source of the obligation and not the law. But when the law creates
the obligation, and the act upon which it is based is nothing more
than a mere factor in determining the moment when it becomes
demandable, then the source of the obligation is the law itself

Article 1159. Obligations arising from contracts have the force

of law between the contracting parties and should be complied with
in good faith. (1091a)
 Known as the Principle of autonomy of will. The parties
can stipulate anything, provided that the terms of the contract are
not contrary to law, public policy or public order

Article 1160. Obligations derived from quasi-contracts shall be

subject to the provisions of Chapter 1, Title XVII, of this Book. (n)
A quasi-contract is that juridical relation resulting from certain lawful,
voluntary and unilateral acts by virtue of which the parties become
bound to each other to the end that no one will be unjustly enriched
or benefited at the expense of another. (Art. 2142)

Kinds of Quasi-Contract
1. Negotiorium gestio – the voluntary management of the
property or affairs of another without the knowledge or consent
of the latter
2. Solutio indebiti – is the juridical relation which is created when
something is received when there is no right to demand it and it
was unduly delivered through mistake. (Art. 2154)

Characteristics of a Quasi-Contract
1. The acts itself must be lawful

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2. The acts executed must be voluntary
3. The acts executed must be unilateral

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. (1092a)

Scope of Civil Liability

a) Restitution
b) Reparation for the damage caused
c) Indemnification for consequential damages (Art. 104, Revised
Penal Code)

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. (1093a)

Requisites of quasi-delicts
1) There must be an act or omission by the defendant;
2) There must be fault of negligence of the defendant;
3) There must be damage caused to the plaintiff
4) There must be a direct relation or connection of cause and effect
between the act or omission and the damage
5) There is no pre-existing contractual relation between the parties

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 NATURE AND EFFECTS OF OBLIGATION

Article 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 car

Generic thing/indeterminate thing – is one that is indicated by

its kinds, without being designated and distinguished from the
others of the same kind. In an obligation to deliver a generic or
indeterminate thing, the thing is determinable and becomes
determinate from the time the obligation has been fulfilled or
performed. A generic thing is something which is not particularized
or specified but has reference to a class or genus

Determinate thing – is something which is susceptible of a

particular design or specification. It is one which is individualized
and can be identified or distinguished from the others of its kind

Article 1164. The creditor has a right to the fruits of the thing
from the time the obligation to deliver arises. However, he shall
acquire no real right over it until the same has been delivered to him.

Classes of Delivery or Tradition

1. Real or Actual tradition – this contemplates actual delivery
of the thing from the hand of the grantor to the hand of the grantee,
if it is a personal property. If it is a real property, it is manifested by
certain possessory acts executed by the grantee with the consent
of the grantor such as by taking over the property; occupying the
property
2. Constructive tradition – when the delivery of the thing is not
actual but representative or symbolical in essence. But there must
be intention to deliver the ownership.

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 Kinds:
a) Tradicion symbolica – delivery of certain symbols or things
representing the thing to be delivered
b) Tradicion instrumental – consists in the delivery of the
instrument of conveyance to the grantee by the grantor
c) Tradicion longa manu – consists in the pointing to a movable
property within sight by the grantor to the grantee but which
at the time of the transaction, the thing could not be place
yet in the possession of the grantee
d) Tradicio brevi manu – consists in the grantee’s continuation
of his possession over the thing delivered but now under a
title of ownership as in case of a lessee who had purchased
the property leased to him
e) Tradicion constitutum possessorium – consists in the
owner’s continuous possession of the property he had sold
to another person and his present possession thereof is no
longer that of the owner but of a lessee
f) Tradicion by operation of law – consists in the delivery of the
thing by operation of law such as intestate succession
g) Quasi-tradicion – consists in the delivery of incorporeal
property

Article 1165. When what is to be delivered is a determinate thing,

the creditor, in addition to the right granted to 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 2 or more person persons who do not have the same interest, he
shall be responsible for any fortuitous event until he has effected the
delivery

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 Remedies of the Creditor
1) Demand for specific performance – this action presupposes that
it is based on a contractual relationship between the contending
parties. Specific performance is available even if the thing to be
delivered is indeterminate
2) Recission of the obligation
3) Resolution of the obligation if it is a reciprocal obligation
4) Damages exclusively or in addition to either of the first actions

General Rule: Obligation to deliver a specific thing is extinguished

by fortuitous event; indeterminate thing is however not extinguished

Exception:
If obligor delays or in default
Obligor is guilty of bad faith

Article 1166. Obligation to give a determinate thing includes that

of delivering all its accessions and accessories, even though they
may not have been mentioned

Article 1167. If a person obliged to do something fails to do it,

they shall be executed at his cost. The 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.

Kinds of Delay/Mora
1. Mora Solvendi

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  Default on part of the debtor which may either be ex re or ex
persona
Requisites:
a) The obligation pertains to the debtor or obligor
b) The obligation is determinate or liquidated, due and
demandable
c) The obligation has not been performed on its maturity date
d) There is a demand made by the creditor on the debtor for the
fulfillment of the obligation that is due

2. Mora Accipiendi
 Default on the part of the creditor. Delay in the performance
of the obligation based on the omission by the creditor of the
necessary cooperation, especially in acceptance on his part. It is
necessary that it be lawful for the debtor to perform, and that he can
perform
Requisites:
a) An offer of performance by the debtor who has the required
capacity
b) The offer must be to comply with the obligation as it should be
performed
c) The creditor refuses the performance without just cause

3. Compensatio Morae
 Applies only in reciprocal obligations. Where the parties are both
guilty of mora or mutual default, the default of one compensates
the default of the other.
Article 1170. Those who in the performance of their obligations
are guilty of fraud, negligence, or delay and those who in any
manner contravene the tenor thereof, are liable for damages
Grounds for liability:

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 • Fraud
• Negligence
• Default
• Violation of terms of obligations
Article 1171. Responsibility arising from negligence in the
performance of every kind of obligation is also demandable, but
such liability may be regulated by the Courts, according to the
circumstances.
Article 1172. Responsibility arising from negligence in the
performance of every kind of obligation is also demandable, but
such liability may be regulated by the Courts, according to the
circumstances
Article 1173. The fault or negligence of the obligor consists in
the omission of that diligence which is required by the nature of the
obligation and corresponds with the circumstances of the persons,
of the time and of the place. When negligence shows bad faith, the
provisions of Art. 1171 and 2201, para. 2 shall apply
Article 1174. Except in cases expressly specified by the law, or
when it is otherwise declared by the stipulation, or when the nature
of the obligation requires assumption of risk, no person shall be
responsible for those events which could not be foreseen, or
which, though foreseen, were inevitable
An obligation consisting of the delivery of a specified thing shall
be extinguished when the said thing shall be lost or destroyed
without the fault of the obligor and before he is in default. The obligor
is released from liability not only when the non-performance is due
to the fortuitous events, but also when it is due to the act of the
creditor himself
1. When the law so provides
2. When it is expressly stipulated by the parties
3. When the nature of the obligation requires the
assumption of risk
4. When the obligor is in delay already

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 5. When the obligor has promised the same thing or two or
more persons who do not have the same interest
6. When the possessor is in bad faith and the thing is lost
or deteriorated due to a fortuitous event
7. When the obligor contributed to the loss of the thing
during the fortuitous event
8. When the obligor is guilty of fraud, negligence or delay
or if he contravene the tenor of the obligation

Article 1175. Usurious transactions shall be governed special

laws
Article 1176. The receipt of the principal by the creditor without
reservation with respect to the interest, shall give rise to the
presumption that said interest has been paid.
The receipt of the later installment of a debt without reservation
as to prior installments shall likewise raise the presumption that such
installments have been paid
When presumptions under Article 1176 do not apply
1. With reservation as the interest – reservation that no payment
has been made as to interest or prior interest as the case may
be. The reservation may be made in writing or verbally.
2. Receipt without indication of particular installment paid –
receipt does not recite that it was issued for a particular
installment dies as when the receipt is only dated.
3. Receipt for a part of the principal – it is only when the principal
is fully receipted for and there is failure by the creditor to
reserve the claim for interest, that the presumption that said
interest has been paid will arise.
4. Payment of taxes – there is no presumption that the previous
taxes has been paid by the payment of the later ones.
5. Non-payment proven – a presumption cannot prevail over a
proven fact.

Article 1177. The creditors, after having pursued the property in

possession of the debtor to satisfy their claims, may exercise all the
rights and bring all the actions of the latter for the same purpose,

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save those which are inherent in his person; they may also impugn
the acts which the debtor may have done to defraud them
Article 1178. Subject to the laws, all rights acquired in virtue of
an obligation are transmissible, if there has been no stipulation to
the contrary
Exceptions (those not transmissible by their nature and those
not transmissible by law or by stipulation of the parties):
• If law provides otherwise
• If contract provides otherwise
• If obligation is purely personal

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 ACTIVITY

1. State the differences between a crime and quasi-delict

2. When does an obligation to deliver arises? What are the

consequences of delivery?

3. Give at least two (2) examples of each kind of Constructive

Tradition

4. What are the consequences of Mora Accipiendi?

5. What are the requisites of Compensatio Morae?

6. What are the differences between Culpa Contractual, Culpa

Aquiliana and Culpa Criminal?

7. What are the elements of Fortuitous events?

Problem: (Explain the reason for your answer)

1. Sam saw at about 2:00 pm in the afternoon a child alone in a

shopping mall. The child who strayed from Phoebe, his mother, was
in tears and appeared very hungry. Out of pity, Sam took him to a
restaurant to eat for which he spent P200. Phoebe did not give her
consent to the good deed of Sam. Furthermore, they were on their
way home before the child got lost. Is Sam entitled to be reimbursed
by Phoebe for the amount of P150?

2. Nick borrowed P10,000 from Marcel. On the due date of the loan,
Nick could not pay because he lost to a pickpocket the P10,000

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intended for Marcel. In addition, he suffered financial reverses, and
he was short of cash even for his current family’s needs. Is Nick
legally justified to refuse to pay Marcel?
3. Colleen promised to deliver to Bella a female horse named Susan
on June 10. Susan gave birth to a colt on June 5.
a) What are the obligations of Colleen?
b) Who has the right to the colt?
c) Who is the lawful owner of Susan in case it was sold and
delivered by Colleen to Trish on June 8?

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