M

O
D INTRODUCTION TO
U LAW
L EDMAR JAMES I. SEBUA, CPA

E
1

LAW 101 (LAW ON OBLIGATIONS & CONTRACTS)||AY. 2020-

2021
LEARNING OBJECTIVES

At the end of the module, learner must be able to:

 Determine the meaning of law in general;

 Know the general divisions of law;
 Emphasize the concept(s) of State Law including its characteristics and
necessity and functions of law;
 Necessity and functions of law;
 Determine the sources of State Law;
 Elaborate the rule in case of doubt in interpretation and application of laws;
 Introduce the Civil Code of the Philippines and its provisions on obligations and
contracts; and
 Explain the conclusive presumption of knowledge of law.
INTRODUCTION

LAW IN THE LIVES OF ACCOUTING STUDENTS

LAW is important for a society for it serves as a norm of

conduct for citizens. It was also made to provide for proper
guidelines and order upon the behaviour for all citizens. It
keeps the society running.

Studying the LAW offers the opportunity to develop a range of

skills and explore many aspects of human life. It gives you the
chance to sharpen your mind, strengthen your understanding
and deepen your experience across the full range of business.
LAW IN GENERAL AND ITS DIVISIONS

In a comprehensive sense, law means any rule of action or any system of

uniformity.

Thus, law, in general, determines not only the activities of men as rational beings
but also the movements or motions of all objects of creation, whether animate or
inanimate.

Law, may be divided into two (2) general groups:

1. Law (in STRICT/LEGAL SENSE), which is created and enforced by the
STATE; and
2. Law (in NON-LEGAL SENSE), which is not created and enforced by the
STATE.

The first refers to what is known as STATE LAW while the second includes
DIVINE LAW, NATURAL LAW, MORAL LAW, and PHYSICAL LAW.

Note: It must be noted that the provisions included and stated this module will
put emphasis on the mandate of the STATE LAW only.
STATE LAW - CONCEPTS

STATE LAW is the law that is promulgated and enforced by the State.

This law is also called POSITIVE LAW, MUNICIPAL LAW,

CIVIL LAW, or IMPERATIVE LAW. It is the law that we refer to
when we speak of law in connection with obligations & contracts,
administration of justice, governmental processes, etc.

In its specific sense, however, the term (STATE) LAW or law itself
has been defined as “a rule of conduct, just, obligatory, promulgated
by legitimate authority, and of common observance and benefit”
STATE LAW - CHARACTERISTICS
“a rule of conduct, just, obligatory, promulgated by legitimate authority, and of
common observance and benefit”

CHARACTERISTICS OF LAW (in specific sense)

1. It is a rule of conduct – the law tells us what shall be done and what shall
not be done;
2. It is obligatory – the law is considered a positive command imposing a
duty to obey and involving a sanction which forces obedience;
3. It is promulgated by legitimate authority – in the Philippines, the
legitimate or competent authority is the legislature (Congress). Thus under
the Constitution, laws are enacted/created by the Congress (which
includes Senate & House of Representatives).
4. It is of common observance and benefit – law is intended by man to serve
man, regulates the relation of men to maintain harmony in society. The
law must be observed by ALL for the benefit of ALL.
NECESSITY AND FUNCTIONS OF LAW

Questions to ponder as of the moment: (it is up to you what will be the answer;
any answer in mind is valid and highly considered)

I. As citizens of our country (Philippines), do we really need law? What

would life be without law?

II. What is the purpose of such law(s)? Is it essential? And why?

III. What is our duty in an organized society or as citizens of a sovereign

state?
NECESSITY AND FUNCTIONS OF LAW

I. As citizens of our country (Philippines), do we really need law? What

would life be without law?

 If we can answer this question, we can answer the more basic

question of whether law is necessary or not. If life without law be the
same as it is not, obviously law is not necessary. In a sense, if we live
in a harmonious society wherein there is growth, peace and order, etc.
are manifested EVEN there is no prevailing law, then law must be
unnecessary. Whereas if it is the contrary, then law is necessary. The
need for internal order (inside a state) is as important as the need also
for external defense (a state’s force to not allow invaders perpetrate
such state). No society can be stable if such requirements stated is not
provided well in a state.
NECESSITY AND FUNCTIONS OF LAW

II. What is the purpose of such law(s)? Is it essential? Is it useless or

purposeless?

 It has been said that law secures justice, resolves social conflict,
orders society, protects interests, controls social relations. Life
without basic laws against theft, violence, and destruction would be
nasty and brutish. Life without other laws such as those regulating
sanitation, traffic, employment, conduct of business, or of broken
agreements (breach of contract/agreement), etc. would be less orderly,
less healthful, less wholesome, etc. Thus such laws are truly essential
to a society and to a state.
NECESSITY AND FUNCTIONS OF LAW

III. What is our duty in an organized society or as citizens of a sovereign

state?

 No society can continue without means of social control and without

rules of social order binding the citizens. Since we find law essential
and necessary, EVERY CITIZEN should have some understanding of
law and observe it for the common good of all.
STATE LAW - SOURCES
The principal sources of law in the Philippines includes the following:
1. Constitution – referred to as the fundamental law or supreme law or highest law of
the land because it is promulgated by the people themselves, binding on all
individual citizens and all agencies and branches of the government.
2. Legislation – it consists in the declaration of legal rules by a competent authority
(legislature). Acts passed by the legislature are called enacted or statute law.
Legislation includes ordinances enacted by local government units (city or municipal
levels).
3. Administrative or executive orders, regulations, and rulings – includes those
issued by administrative officials with legislative authority. It is intended to clarify
or explain the law and to put into effect its general provisions. It should not be
contrary to the laws and Constitution.
4. Judicial decisions or jurisprudence – the decisions of courts, particularly Supreme
Court, applying or interpreting the laws or the Constitution. The decisions of a
superior court on a certain point of law are binding on ALL subordinate courts. What
binds the Supreme Court binds the subordinate courts. This is called the doctrine of
precedent or stare decisis.
STATE LAW - SOURCES
The principal sources of law in the Philippines includes the following:
5. Custom – it consists “habits and practices” which through usage have become
acknowledged and approved by society as binding rules of conduct in a society. It
has the force of law when recognized and enforced by the state. As if it is
acceptable as “like-law” in a certain society, but if such custom is contrary to law,
morals, public order, and public policy, such custom are not countenanced and will
be invalid and void.
6. Other sources – to add to those enumerated above are the principles of justice and
equity, decisions of foreign tribunals, opinions of text writers, and religion. These
are, however, only supplementary. That is, these are only resorted by the courts of
justice in the absence of other sources. However also, these other sources are not
binding on the courts as fundamental basis in its decisions.
RULE IN CASE OF DOUBT IN INTERPRETATION
OR APPLICATION OF LAWS

In case of doubt in the interpretation or application of laws, it is presumed that the law
making body intended right and justice to prevail.

In the Philippines, courts are not only courts of law but also courts of justice.

Whenever a court is faced with a choice between a decision that will serve justice and
another that will deny it because of a too strict interpretation of the law, courts must
resolve in favor of the former (that will serve justice), for the ultimate end of the law is
justice.

This is particularly true where what is at stake is the life, liberty, or property of an
individual, and more so if he is poor or disadvantaged.

“One who has less in life should have more in law”.

THE CIVIL CODE OF THE PHILIPPINES AND ITS PROVISIONS ON OBLIGATIONS
& CONTRACTS

The provisions of Law on Obligations & Contracts is found in The Civil Code of the
Philippines (Republic Act 386). It was approved as RA 386 on June 18, 1949 and took
effect on August 30, 1950.

Book IV of the Civil Code deals with obligations and contracts. The general provisions
on OBLIGATIONS are contained in Title I (Articles 1156 – 1304) while those of
CONTRACTS are in Title II (Articles 1305 – 1422). Book IV also contains provisions
dealing with NATURAL OBLIGATIONS which are in Title III (Articles 1423 –
1430).

The Law on Obligations and Contracts is the body of rules which deals with the nature
and sources of obligations and the rights and duties arising from agreements and the
particular contracts.

Note: Pertinent provisions and articles included in the succeeding discussions are all of
The Civil Code of the Philippines.
CONCLUSIVE PRESUMPTION OF KNOWLEDGE OF LAW

“Ignorance of law excuses no one from compliance therewith” (Art. 3, Civil Code)
With such provision in the Code, EVERYONE, therefore, is CONCLUSIVELY
PRESUMED to KNOW THE LAW. Such presumption is far from reality because not
all people has sufficient knowledge and skill to know the law but such presumption has
been established because of the OBLIGATORY FORCE OF LAW.
Some of many of the reasons why this presumption is important includes the following:
1. If such presumption is not established, then social life will be impossible because
most laws cannot be enforced due to their being unknown to many; so if an
individual faithfully has no knowledge of a law, then such law will not or cannot be
enforced to such individual therefore makes a law useless.
2. It is almost impossible to prove the fault/crime of a person when he claims he is
ignorant or has no knowledge of the law.
3. It will be unfair and unjust to those who knows the law because obligations
increases for those who know it whereas who are ignorant of the law has little or
no obligation at all.
CONCLUSIVE PRESUMPTION OF KNOWLEDGE OF LAW

“Ignorance of law excuses no one from compliance therewith” (Art. 3, Civil Code)
Thus, ignorance of the provisions of the law imposing a penalty for illegal possession of
firearms, or punishing the possession of prohibited drugs, does not constitute a valid
excuse for their violation.
BASIC EXAMPLE:
Question: Mr. A is walking on a park in the city he situated at. While spending his
leisure time on the park, he picked up from his pocket a pack of cigarette and smoked a
piece. Later, a police officer caught his attention and invites him to the police station for
blotter due to Mr. A’s violation to the city ordinance “Prohibition of Smoking in Public
Places”. Accordingly, Mr. A disagreed and was upset with the police officer because he
is just new to the city and he doesn’t have any knowledge of such ordinance. Is Mr. A
correct?

Answer: Mr. A is incorrect with his reason that he doesn’t have any knowledge of
such ordinance because it is NOT A VALID EXCUSE of the commission of a
violation.
SUMMARY
 STATE LAW is the law that is promulgated and enforced by the State.
 LAW or law itself has been defined as “a rule of conduct, just, obligatory,
promulgated by legitimate authority, and of common observance and benefit”
 Having the Law imposed in a society is very essential because it is a means of social
control. We find it necessary and every citizen should have some understanding of
the law and observe it for the common good of all.
 The sources of law includes the Constitution, Legislation, Administrative or
Executive orders, Regulations, and Rulings, Custom and Other sources.
 In case of doubt in the interpretation or application of laws, it is presumed to intend
what is right and justice should prevail in its application or interpretation.
 The provisions of the Law on Obligations and Contracts are found in the Civil Code
of the Philippines (Republic Act 386)
 It is presumed that every citizen knows the law. Ignorance of it is not a valid excuse
for the evasion of such laws.
CIVIL CODE
The Civil Code of the Philippines is the product of the codification of private
law in the Philippines. It is the general law that governs family and property
relations in the Philippines.
END OF MODULE
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Source: Law on Obligations and Contracts (Author: Hector S. De Leon)