ARTICLE 1156.

An obligation is a juridical Essential requisites of an obligation:

necessity to give, PAOJ
to do or not to do. (n)
(1) A passive subject (called debtor or
The term obligation is derived from the Latin
obligor) or the person who is
word “obligatio” bound to the fulfi llment of the obligation; he
which means a “tying” or “binding.”
who has a duty;
(1) It is a tie of law or a juridical bond by
virtue of which one is (2) An active subject (called creditor or
bound in favor of another to render obligee) or the person who
something — and this may consist is entitled to demand the fulfi llment of the
in giving a thing, doing a certain act, or not obligation; he who has a
right;
doing a certain act.
(3) Object or prestation (subject matter of
(2) Manresa defi nes the term as “a legal the obligation) or the conduct
relation established required to be observed by the debtor. It
between one party and another, whereby may consist in giving,
the latter is bound to the doing, or not doing.
fulfi llment of a prestation which the former
may demand of him.” (8 (4) A juridical or legal tie (also called effi
Manresa 13.) cient cause) or that which
binds or connects the parties to the
Meaning of juridical necessity.
obligation. The tie in an obligation
can easily be determined by knowing the
Obligation is a juridical necessity because in
case of non-compliance, source of the obligation
the courts of justice may be called upon to
enforce its fulfi llment or, in
default thereof, the economic value that it
Form of obligation.
represents
(1) As a general rule, the law does not
Nature of obligations under require any form in
the Civil Code. obligations arising from contracts for their
Obligations which give to the creditor or validity or binding force.
obligee a right of action
(2) Obligations arising from other sources
in courts of justice to enforce their
(Art. 1157.) do not have
performance are known as civil
any form at all.
obligations
Obligation, right, and wrong (cause of
They are to be distinguished from natural
action)
obligations which,
distinguished.
not being based on positive law but on
equity and natural law, do not
(1) Obligation is the act or performance
grant a right of action to enforce their
which the law will
performance although in case
Enforce
of voluntary fulfi llment by the debtor, the
latter may not recover what (2) Right, on the other hand, is the power
has been delivered or rendered by reason which a person has
thereof.
under the law, to demand from another any Actions based upon a written contract
prestation. should be brought within 10
years from the time the right of action
(3) A wrong (cause of action), according to accrues
its legal meaning, is an
act or omission of one party in violation of The accrual refers to the cause of action.
the legal right or rights of Accordingly, an action based on a contract
another, causing injury to the latter;1 accrues only when an actual breach or
violation thereof occurs.
Essential elements of cause of action
(1) In an action to rescind a contract of sale
(a) a legal right in favor of a person on installment basis, for
(creditor/plaintiff) by non-payment, the cause of action arises at
whatever means and under whatever law it the time the last installment
arises or is created; is not paid.

(b) a correlative legal obligation on the part Injury, damage, and damages
of another distinguished.
(debtor/defendant) to respect or not to
violate said right; (1) Injury is the illegal invasion of a legal
right
(c) an act or omission in breach or violation
of said right by 2.) while damage is the loss, hurt, or harm
the defendant with consequential injury or which results from the injury
damage to the plaintiff
for which he may maintain an action for the damages denote the sum of money
recovery of damages recoverable as amends for
or other appropriate relief. the wrongful act or omission

(2) If any of these elements is absent, the Existence of one without

complaint becomes the other.
vulnerable to a motion to dismiss on the
ground of failure to state a There may be injury without damage and
cause of action. damage without injury.
The test is whether the material (1) Proof of loss for injury - A wrongful
allegations of the complaint, assuming to be violation of his legal right
true, state ultimate facts is not sufficient to entitle a person to sue
which constitutes plaintiff’s cause of action another in a court of justice
such that plaintiff is entitled for the enforcement or protection of said
to a favorable judgment as a matter of law. right. As a rule, there must
be, in addition, loss or damage caused to
(3) A cause of action only arises when the him by the violation of his
last element occurs, i.e., right. But except for actual or compensatory
at the moment a right has been damages (Art. 2199.), no
transgressed. pecuniary proof is necessary in order that
moral, nominal, temperate,
Cause of action based upon liquidated, or exemplary damages may be
a written contract. awarded
(2) Liability for damages of a person for agreement
exercising his legal rights- One who makes
use of his legal right does no injury. Qui jure (3) Quasi-contracts. — when they arise from
suo utitur mullum damnum facit. If damage lawful, voluntary and
results from a unilateral acts and which are enforceable to
person’s exercising his legal rights, it is the end that no one shall
damnum absque injuria (damage without be unjustly enriched or benefi ted at the
injury). expense of another (Art. 2142.),
e.g., the obligation to return money paid by
Kinds of obligation according mistake or which is not
to subject matter due. (Art. 2154.) In a sense, these
obligations may be considered as
(1) Real obligation (obligation to give) or arising from law;
that in which the subject
matter is a thing which the obligor must (4) Crimes or acts or omissions punished by
deliver to the obligee; law. — when they arise
from civil liability which is the consequence
(2) Personal obligation (obligation to do or of a criminal offense (Art.
not to do) or that in 1161.), e.g., the obligation of a thief to
which the subject matter is an act to be return the car stolen by him; the
done or not to be done. duty of a killer to indemnify the heirs of his
victim;
There are thus two (2) kinds of personal
obligation: (5) Quasi-delicts or torts. — when they arise
(a) Positive personal obligation or obligation from damage caused
to do or to render to another through an act or omission, there
service (see Art. 1167.) being fault or negligence,
(b) Negative personal obligation or but no contractual relation exists between
obligation not to do (which the parties (Art. 2176.), e.g.,
naturally includes obligations “not to give”) the obligation of the head of a family that
lives in a building or a part
thereof to answer for damages caused by
things thrown or falling from
the same (Art. 2193.); the obligation of the
ART. 1157. Obligations arise from: possessor of an animal to
(1) Law;
pay for the damage which it may have
(2) Contracts;
(3) Quasi-contracts; caused.
(4) Acts or omissions punished by law; and
(5) Quasi-delicts. (1089a) Sources classifi ed.

The law enumerates fi ve (5) sources of

(1) Law. — when they are imposed by the obligations. They may be
law itself, e.g., obligation classifi ed as follows:
to pay taxes; obligation to support one’s
family (see Art. 195, Family (1) Those emanating from law; and
Code.);
(2) Those emanating from private acts
(2) Contracts. — when they arise from the which may be further
stipulation of the subdivided into:
parties (Art. 1306.), e.g., the obligation to
repay a loan by virtue of an
(a) those arising from licit acts, in the case may without the consent of the other,
of contracts and renege therefrom.
quasi-contracts; and
(2) Requirements of a valid contract. — As
(b) those arising from illicit acts, which may a source of obligation, a
be either contract must be valid and enforceable.
punishable by law in the case of delicts, or (see Art. 1403.) A contract is
not punishable in the valid (assuming all the essential elements
case of quasi-delicts. are present, Art. 1318.) if it
is not contrary to law, morals, good
ART. 1158. Obligations derived from law are customs, public order, and public
not presumed. policy. It is invalid or void if it is contrary to
Only those expressly determined in this
Code or in special laws
law, morals, good customs,
are demandable, and shall be regulated by public order, or public policy.
the precepts of the
law which establishes them; and as to what (3) Where contract requires approval by the
has not been foreseen, government. — Where a
by the provisions of this Book. (1090) contract is required to be verifi ed and
approved by the government
Article 1158 refers to legal obligations or before it can take effect (e.g., contract for
obligations arising from overseas employment must
Law be approved by the Philippine Overseas
Employment Administration
They are not presumed because they are [POEA] under Art. 21[c] of the Labor Code),
considered a burden upon such contract becomes the
the obligor. They are the exception, not the law between the contracting parties only
rule. To be demandable, when approved, and where
they must be clearly set forth in the law, i.e., there is nothing in it which is contrary to law,
the Civil Code or special etc., its validity must be
laws. sustained

ART. 1159. Obligations arising from (4) Compliance in good faith. — It means
contracts have the force compliance or performance
of law between the contracting parties and in accordance with the stipulations or terms
should be complied
of the contract or
with in good faith
agreement.9 Good faith and fair dealing
A contract is a meeting of minds between must be observed to prevent one party from
two persons whereby one taking unfair advantage over the other.
binds himself, with respect to the other, to Evasion by a party of legitimate obligations
give something or to render after receiving the benefi ts under the
some service. contract would constitute unjust enrichment
on his part.
(1) Binding force. — Obligations arising
from contracts are (5) Liability for breach of contract. —
governed primarily by the agreement of the Although the contract imposes
contracting parties. Once no penalty for its violation, a party cannot
perfected, valid contracts have the force of breach it with impunity. Our
law between the parties law on contracts recognizes the principle
who are bound to comply therewith in good that actionable injury inheres
faith, and neither one in every contractual breach.
Interest may, in the discretion of
the court, on equitable grounds, be allowed (a) When the property or business is not
upon damages awarded neglected or abandoned,
for breach of contract. in which case the provisions of the Civil
Code regarding
6) Preservation of interest of promisee. — A unauthorized contracts (Arts. 1317, 1403[1],
breach upon the contract 1404.) shall govern;
confers upon the injured party a valid cause
for recovering that which (b) If, in fact, the manager has been tacitly
may have been lost or suffered. The remedy authorized by
serves to preserve the the owner, in which case the rules on
interest of the promisee of having the benefi agency shall govern. (Art.
t of his bargain, or in being 2144.)
reimbursed for loss caused by reliance on
the contract, or in having (2) Solutio indebiti is the juridical relation
restored to him any benefi t that he has which is created when
conferred on the other party. something is received when there is no right
to demand it and it was
ART. 1160. Obligations derived from quasi- unduly delivered through mistake. (Art.
contracts shall 2154.)
be subject to the provisions of Chapter 1,
Title XVII, of this Solutio indebiti applies where:
Book. (n)
(a) payment is made when there exists no
binding relation
Article 1160 treats of obligations arising
between the payor, who has no duty to pay,
from quasi-contracts or
and the person who
contracts implied in law.
received the payment;
In a quasi-contract, there is no consent but
(b) the payment is made through mistake11
the same is supplied by fi ction of law. In
and not through
other words, the law considers the parties
liberality or some other cause.
as having entered into a contract,
irrespective of their
(3) Other cases. — Other examples of
intention, to prevent injustice.
quasi-contracts are provided
in Article 2164 to Article 2175 of the Civil
Corollarily, if one who claims having
Code.12
enriched somebody has done so pursuant
to a contract with a third party, his cause of
ART. 1161. Civil obligations arising from
action should be against the latter, who, in criminal offenses
turn, may, if there is any ground therefor, shall be governed by the penal laws,14
seek relief against the party benefited. subject to the provisions
of Article 2177,15 and of the pertinent
Kinds of quasi-contracts. provisions of Chapter 2,
Preliminary Title on Human Relations,16 and
(1) Negotiorum gestio is the voluntary of Title XVIII of this
management of the property Book, regulating damages. (1092a)
or affairs of another without the knowledge
or consent of the latter. This article deals with civil liability arising
from crimes or delicts.
This juridical relation does not arise in either
of these instances: (2) Oftentimes, the commission of a crime
causes not only moral
evil but also material damage. From this governed by the provisions of Chapter 2,
principle, the rule has been Title XVII of this Book,
established that every person criminally and by special laws.
liable for a felony17 is also
civilly liable. (Art. 100, Revised Penal Code; A quasi-delict20 is an act or omission by a
see Albert, the Revised person (tort feasor) which
Penal Code Annotated, p. 276.) In crimes, causes damage to another in his person,
however, which cause property, or rights giving
no material damage (like contempt, insults rise to an obligation to pay for the damage
to person in authority, done, there being fault or
gambling, violations of traffi c regulations, negligence but there is no pre-existing
etc.), there is no civil liability contractual relation between
to be enforced. But a person not criminally the parties.
responsible may still be
liable civilly. ( Requisites of quasi-delict.

Reservation of right to recover civil (1) There must be an act or omission by the
liability. defendant;
(2) There must be fault or negligence of the
Under the present rule, only the civil liability defendant;
arising from the (3) There must be damage caused to the
offense charged is deemed instituted with plaintiff;
the criminal action unless the (4) There must be a direct relation or
offended party waives the civil action, connection of cause and
reserves his right to institute it effect between the act or omission and the
separately, or institutes the civil action prior damage; and
to the criminal action. (5) There is no pre-existing contractual
relation between the
The reservation and waiver referred to refer Parties
only to the civil action
for the recovery of the civil liability arising Crime distinguished from quasi-delict.
from the offense charged.
This does not include recovery of civil (1) In crime or delict, there is criminal or
liability under Articles 32, 33, malicious intent or criminal
34 and 2176 of the Civil Code of the negligence, while in quasi-delict, there is
Philippines arising from the same only negligence;
act or omission which may be prosecuted
separately even without a (2) Crime affects public interest, while
reservation quasi-delict concerns
private interest;
Scope of civil liability.
(3) In crime, there are generally two
(1) Restitution; liabilities: criminal and civil,23
(2) Reparation for the damage caused; and while in quasi-delict, there is only civil
(3) Indemnifi cation for consequential liability;
damages. (Art. 104, Revised
Penal Code.) (4) In crime or delict, the purpose is
punishment, while in quasidelict,
ART. 1162. Obligations derived from quasi- indemnifi cation24 of the offended party;
delicts shall be
(5) Criminal liability can not be
compromised or settled by
the parties themselves, while the liability for
quasi-delict can be
compromised as any other civil liability;

(6) In crime, the guilt of the accused must

be proved beyond reasonable
doubt, while in quasi-delict, the fault or
negligence of the defendant
need only be proved by preponderance of
evidence; and

(7) In crime, the liability of the person

responsible for the author
of the negligent act or omission is
subsidiary, while in quasi-delict, it is
direct and primary.

Recovery of damages twice for the same

act or omission prohibited.

Under Article 1157, quasi-delict and an act

or omission punishable
by law are two different sources of
obligations. Inasmuch as civil
liability co-exists with criminal responsibility
in negligence cases, the
offended party has the option between an
action for enforcement of
civil liability based on culpa criminal under
Article 100 of the Revised
Penal Code and an action for recovery of
damages based on culpa aquiliana
under Article 2177.25

These two causes of action (ex delicto or ex

quasi delicto) may be
availed of subject to the caveat that the
offended party cannot recover
damages twice for the same act or omission
or under both causes. Since
these two (2) civil liabilities are distinct and
independent of each other,
the failure to recover in one will not
necessarily preclude recovery in
the other. (Equitable Leasing Corporation
vs. Suyom, 388 SCRA 445
[2002].)