Kinds of Obligation

CLASSIFICATION OF OBLIGATIONS
A. PRIMARY CLASSIFICATION
• Pure and Conditional
• With a Term or with a Period
• Alternative and Facultative
• Joint and Solidary
• Divisible and Indivisible
• With a Penal Clause
CLASSIFICATION OF OBLIGATIONS

B. SECONDARY CLASSIFICATION
• Unilateral and Bilateral
• Reciprocal and Non-reciprocal
• Determinate and Generic
• Legal and Conventional
• Penal
 PURE AND CONDITIONAL
PURE OBLIGATION – an obligation that does not contain any
term or condition. It is demandable at
once.
Example: I will give you an I phone.

CONDITIONAL OBLIGATION- the fulfillment or the extinguishment

of which is subject to a condition.
Example: I will give you an I phone if you attend to my party.
CONDITION – is every future and uncertain event upon which the
obligation depends.

KINDS OF CONDITION
RESOLUTORY CONDITION – the happening of which extinguishes the
obligation.
example: I will provide your basic needs until the pandemic ends.
I will give you your allowance until you graduate from TIP.
SUSPENSIVE CONDITION- the happening of which gives rise to the
obligation.
example: I will give you a car once you graduate from TIP.
 KINDS OF CONDITION ACCORDING TO CAUSE (Art. 1182)
 POTESTATIVE – one which depends upon the will of one of the contacting
parties. Example: I will pay you when I receive the
proceeds of my loan from the bank.

 CASUAL – one which depends upon a chance or other factors.

Example: I will pay you when I win the lotto draw tonight.

 MIXED – one which depends partly upon the will of the parties, partly
upon a chance, or will of the third person.
Example: I will give you a car if you marry your girlfriend.
LOSS, DETERIORATION AND IMPROVEMENT
LOSS
 Without fault of the debtor - the obligations is extinguish
 Through the fault of the debtor – payment of damages

DETERIORATION (value is reduced or impaired)

 Without the fault of the debtor – impairment is borne by creditor
 Through the fault of the debtor – creditor may choose between:
(a) recission of the obligation; and
(b) fulfillment of the obligation
with indemnity for damages in either case. (Article 1189)
IMPROVEMENT (Value is increased or enhanced)

The object may improve

 By nature or by time- benefit of the creditor
 At the expense of the debtor – debtors is granted usufructuary right.
PERIOD OR TERM – refers to an interval to time which
either suspends its demandability or
produces is extnguishment.

Day certain – that which must necessarily come although it may

not be known when.

Example: Death
KINDS OF PERIOD
• As to effect
a.) suspensive (ex die)- obligation is demandable upon arrival of the day
certain
b) Resolutory – obligation is demandable at once

• According to source
a) Legal – granted by law
b) Conventional – stipulated by the parties
c) Judicial-fixed by courts
The debtor losses the benefit of the period:

1. Insolvency of the debtor;

2. Failure to the debtor to furnish the creditor the guaranties
or securities promised;
3. Debtor impaired the guaranties or securities (including
fortuitous event;
4. The debtor violates undertaking in consideration of which
the creditor agreed to a period;
5. Debtor attempts to abscond
OLBIGATIONS DEMANDABLE AT ONCE:
 Pure obligations
 Obligations with a resolutory condition
 Obligations with a resolutory period
DIFFERENCE BETWEEN PERIOD AND CONDITION
PERIOD
 Interval of time which future and
certain
 It necessarily come
 Exerts influence on when the
obligation shall be demandable and
extinguish
 Does not have retroactive effect
CONDITION
 Fact and event is which future and
uncertain
 May or may not happen
 Exerts influence on the existence of the
obligation
 Has retroactive effect
ALTERNATIVE OBLIGATION –one where out of two or more
prestations, only one is due.

Example: Mary binds herself to give Macky an i phone, a laptop, a ticket

for 2 to Macau, or a trip to Boracay.

FACULTATIVE OBLIGATION – one where only one prestation has been

agreed upon by the parties but the obligor may render another as a
substitute.
 DIFFERENCE BETWEEN ALTERNATIVE AND
FACULTATIVE OBLIGATIONS
ALTERNATIVE
 Several prestations are due, but the performance of
one is sufficient to extinguish the whole obligation;
 If it is impossible to give all except the last one, the
last must still be given;
 Right to choose may be given to the debtor or
creditor;
FACULTATIVE
 Only one obligation is due but the obligor may
deliver/perform another in substitution;
 If it is impossible to give the principal, the substitute
need not be given; if it is impossible to give the
substitute the principal must still be given;
 Right to choose always belong to the debtor;
 EFFECT OF LOSS IN FACULTATIVE
OBLIGATIONS
Before substitution
 If the principal thing is lost due to
fortuitous event, the obligation is
extinguish. If the loss is through the
debtors fault, he is liable for damages.
 If the substitute is lost with or without
the debtors fault, the loss will not affect
the effectivity of the obligations. The
principal object still has to be
delivered.
After substitution
 If the principal object is lost for any cause,
the debtor would no longer be liable for
said loss because after substitution, the
principal thing is no longer due.
 If the substitute thing is lost due to
fortuitous event, the obligations is
extinguished. But if the loss is through the
debtor’s fault, he shall be liable for
damages.
Joint obligation – the obligation is to be performed proportionately
by the debtors and to be demanded proportionately by the creditors.

Other term:
1) Proportionate;
2) pro-rata;
3) Mancomunada;
4) mancomunda simple;
5) we promised to pay;
6) to each his own
Solidary obligation- the obligation may be performed in whole by
only one debtor and maybe demanded in full by only one
creditor.

Other terms:
1. Joint and severally;
2. Individually and collectively;
3. In solidum;
4. Mancomunada solidaria;
5. I promise to pay (signed by all debtors)
6. One for all; all for one.
Solidarity exist:

1. When stipulated by the parties;

2. When the law provides for solidarity;
3. When the nature of the obligation requires solidarity

Otherwise the obligation is joint

CHARACTERISTICS OF JOINT INDIVISIBLE OBLIGATION

1. Demand must be made to all joint debtors;

2. Creditors must proceed against all joint creditors;
3. Joint creditor is allowed to renounce his proportionate credit
4. Delivery must be made to all the joint creditors unless one of them
has been authorized by the others to receive in their behalf.
DEFENSES AVAILABLE TO SOLIDARY DEBTORS

1. Personal to him;
2. Personal to his co-debtor;
3. Nature of the obligation.

Effect of Payment made by solidary debtor – the obligations is

extinguished.
Divisible obligation- one that is capable of partial performance.

Example: to deliver 20 sacks of rice

Indivisible obligation- one that is not capable of partial

performance.

Example: to deliver a car.

What determines divisibility and indivisibility of obligations
a. Conventional - Agreement of the parties
b. Natural/absolute- Nature of the obligations
c. Legal – provided for by law

“Quantum Meriut” allows recovery of the reasonable value of the work done
regardless of any agreement as to the value. It entitles the party to “as much
as he reasonably deserves”. This does not apply in indivisible obligation.
Obligation with a Penal Clause

Penal Clause- an accessory undertaking to assume greater liability on the

part of the obligor in case of breach.

Purposes:
 To ensure performance;
 To substitute for damages and payment of interest;
 To punish the debtor for non-fulfillment