RFBT1

FIRST LESSON: OBLIGATIONS ANO CONTRACTS

Art. 11 56 - deflnllion of an obligallon

· an obligation is defined as a juridical necessity to give, to do, or not to
do.

An obligation covers 3 matters:

To do - it includes all kinds of work or service

To give - a prestalion we consists in the delivery of a movable or unmovable thing.
Not to do - pertains to negative obligations (yung hindi mo pweding gawin).

► 4 Essential Elements of an Obligation

1. Passive Subject - debtor or obligor

· the person from whom the obligation is juridically demandable.
· the person who has the obligation .
· the person who has the obligation to give, to do, or not to do.

2. Active Subject - the creditor or obligee

· the person who has the right to demand the fulfillment of the obligation.
(Siya yung magdedemand ng compliance or the performance. or the
giving, or the not to do or the doing of something by the passive subject.)
3, Oblect - the fact. prestatlon. or service
• particular conduct that the debtor or obliger shall or may do
• ii consists in the giving, doing, or not doing
4. Jurtdlctl tie - legal lie or efficient cause or vlnculum Juris (latin term)
· it Is which creates the relation between the passive subject and the
active subject.
· this is what will bind them In order that a relationship or an obligation
will be created.

Illustration (of the 4 elements of an Obligation):

In a contract - between X and TSU. X agreed to teach in TSU for a year for a compensation.
» X is the •passive subject" or the debtor or the obligor kase may obligation siya to do (which
Is to teach)
» TSU Is the •creditor or the active subject• In the sense that - kapag blnayaren nl TSU si X
nung compensation, TSU has the right to demand the perfonmance of the obligation from X.
» To teach tor one year Is the ·oblect· <to give, to do, or not to dol of the obligation. ObJect
here Is the service.
» The ·1egal tie/Juridical tie" here la the contract. The contract la the one that created an
obligation between the active subject and the passive subject.

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[TAKE NOTE:]there Is no obllgatlon In case one of these elements Is missing.
Art. 1157 - Obligations arise from? Simply put: Sources of Obligation
where do obligations come from?

(this enumerations are exclusive, kapeg wela dito hlndi source ng obligation)

► 5 Sources of Obligations

1. Law - law is a rule of conduct, just and obligatory that Is promulgated by a legitimate
authority (congress) for the common observance and benefit of all.

'Ignorance of the law excuses no one from compliance therewith·

Pinaka-common na law (we is a source of an obligation)

-The payment of Taxes -what is the basis? >our Law.
We are required by the National nternal Revenue Code as well as our Local
Government Code, to pay our taxes.
- Why do our parents support us - because of the Family Code of the
Philippines (we Is the Law) of course kasama na dun yung moral obligations ng
parents natln to love and care, but in case they fail to do ao, do know that there is a law
that requires our parents to support and take cart of their children.

2 Contract~ - 11 contract Is 11 ·ro,1!100 of mlnde" between two persons. for one binds
himself with respect to the other to give something or to render some service.

Meeting of minds - actually pertains to consent or agreement.

The virtue of a contract, an obligation Is created

The other binds himself to do something or to render some service.

3. Quasi-Contracts - these are voluntary and unilateral acts which give rise to the
juridical relation, to the end, that no one shall be unjustly enriched or benelited at the
expense of another.

Quasi means ·as Ir

·voluntary and unilateral act· (uni means Ilsa lang ang gumawa)
Pano yon e ang contract Is bilateral (dalawa, contractor is an obllgor and an obllgee)
But In a quasi-contract, it's just unilateral •·· so yung I sang party did something which Is
voluntary on his part - na ltong isang party, wala slyang kinalaman, wala siyang permiso.

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To Illustrate:
» THERE ARE TWO KINDS OF QUASI-CONTRACTS
1. Negotlorum Gesto
• When a person, voluntarily takes charge of the propeny or business or anolher
without any power.

e.g. -A and his family went on a vacation sa Baguio tapos suddenly nagkaroon ng fire o
nasunog yung bahay nlla and their dogs na nalwan doon were neglected, then B (which
is his neighbor) naawa siya dun sa mga aso so he saved them and took care (basically
adopted) of them for a week. He fed them and give them necessary services or actions.
So - walang authority or permiso si A para sa kanyang neighbor na gawin yon. but ·as if"
(quasi) a contract was created between A and his Neighbor. Pero hindi pwedeng sabihin
ni Ana wala naman tayong kontrata o pinag usapan na alagaan mo yung mga aso ko
kaya hindi ko ire-reimburse yung mga nagastos mo. -KASI NGA ang sabi ng quasi-
contracts e "that no one (to the end) shall be unjustly enriched or benefited at the
expense of another."

·there la Injustice there for the one who voluntarily did a unilateral act In favor of
someone/somebody.

2. Solutlo 1ndeb111
• this type of quas~contracts says that kapag may natanggap ka pero wala kang
karapatang tumanggap non, it is your ob lgatlon to return it because you have no right to
receive it.
E.G. - Wala kang ine-expect na ma rreceive na cash tru your gcash and then suddenly
may na-credit sa gcash mo. And then may tumatawag sayo asking for that cash. na
nagkamali nga daw. You don't say to that person na. hlndi, akin na to, voluntary mo
namang nabigay sakin, thank you. NO. That is not right. You have the obligation to
return it or reimburse it.

SOLUTIO INDEBITI - you have received something despite the fact that you do not have
the right to receive it.

You have the obligation to return it or reimburse It.

Do not unjustly enrich yourself at the expense of another.

)Other queak:ontracts: -support given by strangers.

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4. Acts or omissions punished by Law - these are called simply as ·dellcts· - are
crimes. Violations of law. Especially a wrongful act or omission giving rise to a claim or
compensation.

Thia Is In llned with the principle under ertlole 100 of the revised penel code. - ang
revised penal code natin e andlto lahat ng crimes na pwedeng lpasa satin if we do
unlawful acts.

> It says there lhat a person who Is crim inally liable is likewise civilly liable.

TO ILLUSTRATE:

Pinaka-classic example ng delicts ay homicide, so may namatay. Killing somebody is a

delict
Now. aside from the penalty of imprisonment, pag nasentenced ka. imprisonment of 12
yrs-20yrs PLUS the payment of damages
- the amount charged represents the civil aspect of the case of the delict which is the
payment of damages.
For e.g . - Sa crimes sa property, slnadya mong bunggUln yung car and nasira mo yung
windshield etc. Masesentensyahan ka ng pagkakakulong PLUS restitution or reparation
we is likely 10 pay the amount nung kung ano yung nasira mo {windshield).

REMEMBER: Pag dellct or crime yan, hlndi Ieng Imprisonment, there Is likewise a
payment of damages.

[CIVIL LIABILITY: Restitution, Reparation, paying of damages]

[NOTE: HINDI YUNG PAGKAKAKULONG YUNG OBLIGATION, PENALTY (or the delict)
YUN. YUNG OBLIGATION DITO IS TO GIVE OR TO PAY THE AMOUNT OF DAMAGES.]

If you did a crime hindi lang kulong, magmumulta ka rln.

YOUR PENAL TY OF IMPRISONMENT IS ENT/RELY DIFFERENT FROM YOUR OBL/GA TION

TO GIVE OR TO PAY SA CIVIL INDEMNITY.

s.Ouast-dellcts - tort
• whoever, by acts or omission causes damage to another, there be fault
or negligence Is obliged lo pay for the damages done. - kahil walang pre-existing
contractual relation between the parties.

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 Keilengen niyeng b11y11r1n yung damages n11 gln11w1 nlye because he Is guilty of fault or
negligence.

There Is no pre-existing contractual obligations from the obllgor and the obligee pero
baklt mayroong ginawang juridical tie? Quasl·dellct.

E.G. Ang pinaka·classic dito ay-· a driver of a motor and a pedestrian. do they have an
existing contract? Wala diba. If this driver accidentally. by negligence. recklessly drove
that vehicle and thump a pedestrian, nasagasaan niya. May obligation ba yung driver
kahit wala silang juridical tie? They have no contract den. so why does he have an
obligation doon? That is the principle of Quasi-<lelicts. As if (may crime)

Remember, ang batas natln hlndl kayang I-qualify lahat kaya there are other concepts
which were created as, hindi naman substitute but like an enforcement. kasi tulad nyan,
walang betas na nagsasabl na pag nakabungo ka ng pedestrian. u have an obllgallon.

Keye the prlnclple of quasl-dellcts and quasi-contracts were created to akl our laws
keel nga our laws are not perfect.

{rAKENOTEj
- kapag wala dito hindi source ng obligation.
- practices or customs are not a source of obligation (sou cannot legally demand such force
or rights)

{rAKE NOTEEE: THERE IS ONLY AN OBLIGATION IF THE LAW SAY SO]

Art. 1158 - it states here that obligations derived from law are not presumed.
(so kung wala daw nakasulat o sinabl ang batas, wala tayong obligation.)
- only those expressly determined In this code or In special laws are dem11nd11ble and shall be
regulated by the precepts of the law.
When we say kasi n11 "legally or demendeble"

(I forgot to mention, why la It celled Juridical necessity ang obllgatlon. - remember ne It Is

called• Juridical necessity kast In case of the failure of the obligor to perform his obligation to
give, to do, or not to do, ls that the obligee could go to court (when we say Judiciary or
Juridically go to court. we could seek the assistance of the court In the enforcement of our

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right or In demanding the perfonnance of the obligation.) Actually, the Juridical necessity term
there connotes, it states there that, In case of the failure of the obllgor or of the debtor to
comply hie obligation, you could go to court and demand him to do It but If It's not In the law, u
could not demand it because that Is not an obllgatlon. If It Is not In the contract, you cannot
legally demand it because It's not In your contract. UNLESS, quaal-eontracta which are
specified by law - the solutlon-lndebitl, the negotlorum geatlo. That Is legally demandable.
Ace nga aa article 100 of the penal code, It says there na kapag ang tao, napatunayan na
gumawa ng krlmen, stya ay obllgadong magbayad. Naaa bates yen. And quaaklelicta likewise,
these are legally demandable.

SO IN SHORT, under article 1158, kapag wale doon se law, end doon sa other forms of
sources of obligations. there is no Jurldlcal necessity, or you have no juridical claim, or you
have no right to enforce such claims before our courts.
If there is no law, there is no obligation.

NEXT TOPIC WOULD COME FROM ARTICLE 1159.

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Art. 1159· states that OBLIGATIONS ARISING FROM CONTRACTS HAVE THE FORCE OF LAW
BETWEEN THE CONTRACTING PARTIES AND SHOULD BE COMPLIED WITH IN GOOD FAITH.
Contract• meeting of minds. - There are two Parties who have come to an Agreement.
So when this two parties agreed with the terms and conditions of the oontract. They must observe
honesty and sincerity.
These two parties are bound to perlorm what Is Incumbent upon them or what Is their duty In that
contract_
- e.g. If you are a seller, you are bound to deliver. If you are a buyer, your obligation Is to
pay for the object delivered.
► Compliance in Good Faith - the compliance/performance in accordance with the
stipulations and terms of the agreement, sincerity and honesty must be observed to
preverrt one party from taking an unfair advantage to the other. - if you enter into a
contract and you decided what are its terms, conditions, mga corresponding sanctions
kung in case of violations and all that.
So as a contracting party, whether you are an obligor or the obligee, you are expected na
gawin kung ano yung obllgation na binind mo yung sarill mo dun sa kabilang Partido. And in
doing that you must observe honesty in good faith. Honesty and sincerity. So wag mong
lttwist or babaguhin yung terms and conditions under ur contract in order to take advantage or
unfair edge against the other contracting party.

If you will not comply wl1h your obligatlon under II contract then you will be held liable for 11
breach of contrlct.

SO THAT IS COMPLIANCE IN GOOD FAITH.

ART. 1160
► Obligations derived from Quasi-contracts-/ Quasi-contractual obligations
- these are made in order that we should not unjustly enrich or benefrt ourselves
at the expense of another.
- there is actually an imperfect contract there kasi nga there is no consent
• pero here sa quasi-contract, consent there is supplied by fiction of law. Batas
na ang nagsasabi na may consent doon kaya nga quasi-contract.
ART. 1161
► Civil Liability arising from crimes or delicts
• ang p11gkllkaal11m kasi natin pag you are guilty of II crime, ang sirrtensya ay
p11gk11k11kulong, HOWEVER. under artlcle 100 of the revised penal code, It says that!
RtrJOO who Is cdmlnalty liable Is likewise cMUv Hable. -meaning kapag ikaw ay
napatunayan na gumawa ng krimen, maUban sa slntenslya na pagkakakulong, ay
meron ka ring danyos na obllgasyon or CIVIL LIABILITY.

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» What are Included In the Civil Liability
1. Restitution - to restore, to make good.
• kunware slnlra mo yung glees windows ng neighbor mo, papalltan mo,
g111tusan mo yung pagpapapallt nung kung 11no mang 1lnlr11 mo.
2. Reparation (for the damaged cost) - to pay other damages suffered by Y as a
consequence of the crime.

AGAIN (EMPHASIS LANG) OF QUASl·DELICTS

• eto yung REQUISITES OF QUASI-DELICTS
• There must be fault or negligence
• There Is no prlHXlstlng contractual relation between the parties.
"Negligence - is the failure to observe or the protection of the interest of another person
( your negligence will cause you to be liable for the damages done)
Article 11 63

► Every Person obliged to give something Is also obliged to take care of It with proper
diligence of a good father of a family uriess the law or the stipulation of the parties
requires another standard of care.
This article talks about ordinary diligence as the diligence of a good father of a family... "the
law or the stipulation". ·another standard of care· - that 11 tha extraordinary diligence.
Specific or Determinate thing {SPECIFIC} - p11n1cul11rly daslgnated or physlcally segregated
from the others of the same clus. (e.g.) A Toyota vlos car, with plate number B81, model
BBV316, modeled 2018.
Generic or Indeterminate thing (GENERAL) - refers only to 11 "class or genus• to which It
pertains and cannot be pointed out with particularity.
► Duties of debtor In obligation to give a determinate thing

o First Duty of the debtor or obligor

1 . Preserve the thing
So if you're an obligor and u are obliged to give a_ let's say a cow, you are
also obliged to take care of it as a good father of a family. (That's ordinary
care)
HINDI MO PWEOENG SABHIN NA HINDI NAMAN NA SAAKJN YUNG COW,
HINDI KO NA SIVA PAKAKAININ, PAIINUMIN, ETC. NO.

AGAIN, the concept of ordinary dUigence Is the same as the diligence of 1

good (other in otomity.
"Diligence of a good father In a family" means the diligence o yung degrae
of care that a reasonably prudent person exercises over his OWN property.

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 lblgnblhln, kahlt hlndl na sayo yen, and you have the obligation to deliver It
then u are obliged to take care of It na es If lkaw ang nagmamay-ari nung
object na yon.
-So that la the ORDINARY DILIGENCE

- There Is also another standard of care

GENERAUY, an obllgor Is required to exercise ordinary dlllgence,
HOWEVER, If there la another standard of care, that la required by the law, or that Is stipulated
by the parties, when the obllgor is obliged to exercise another standard of care,
EXTRAORDINARY DILIGENCE - or the kind of dlllgence that they have stipulated in that
contract. KUNG WAlANG STIPULATION, the obligor is required to exercise ordinary diligence.
PERO, may ibang circumstances na nirerequire ng bates ay extraordinary diligence.
Kung yung ORDINARY DILIGENCE ay ine--equate as the diligence of a good father, H!qUate
natinyung
EXTRAORDINARY DILIGENCE as the dlllgence of a good mother.

For common carriers engage In the transportation of persona, they exercise

extraordinary dlllgence, (take note ang object nlla ay people, HUMAN LIVES
kaya thla Is the level of care that they exercise)
SO WHAT IS EXTRAORDINARY DILIGENCE.
- It Is the kind of care or degree of care that one haa to exercise for the common
carriers, these carrlera are bound to carry the passengers safely as far as human care and
foresight can provide
- In short the level of care sa extraordinary dlllgence e double or tltriplehin ang ordinary
dlllgence lalo na't buhay ng tao ang nakasalalay.
-the other standard of care-> BY STIPULATION,
NOTE: Hindi pwedeng magstipulate na lesser or mas mababa sa ordinary diligence, pwede
mag agree na more the OD but never less than.
- so this is the first duty of the debtor In obligation to give. And here we discussed the
preservation of the thing and under the preservation of the thing we discussed the Ordinary
and Extraordinary Diligence. -

(Second Duty of the Debtor)

2. To Deliver the fruits of the thing
3. To Deliver The Accessions and Accessories
4. To Deliver the thing itself
5. To Answer for Damages In case of non-fulfillment or breach

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Art 1164

Fruits of the thing

>> Kinds of Fruits
1. Natural Fruit - the spontaneous products of the son, and the young and other
products of animals (e.g. grass (no intervention of human labor)

2. Industrial Fruits - produced by lands of any ki nd through cultivation or labor

(mga tlnatanlm)

3. Civil Fruits - those derived by virtue of a jurldlcal relation.

e.g. Rents ng building, so pag sa bldg. pinaupahan dibs namumunga yun
(pera) - kaya sabi nga by virtue of a juridical relation. Kasi mayroong nangungupahan
under lease of contract or contract of lease.

>>> RIGHT OF CREDITOR TO THE FRUITS

Ace to Article 1164, The creditor has a right to the fruits of the thing from the
time the obligation to deliver It arises.

>>> PERSONAL RIGHT VS REAL RIGHT

PERSONAL RIGHT

Is the right or power of a person (creditor) to demand from another (debtor) the
fulfillment of the latter's obligatlon to give, to do, or not to do.
- It's your right to demand the fulflllment of the obligation of the other party.

REAL RIGHT

Is the right or interest of a person over a specific thing.

- So yung real right mo is yung Karapatan ng lsang tao over a specific thing like
ownership. (e.g. your right to own a car, a bldg., to own a land}

Art 1165
- talks about the remedies of creditor In real obligation
It's not actually only In real obligations but these three remedies are the rights of a
creditor generally.

So ano bang Karapatan ng Creditor

1. To demand specific performance or fulfillment (if It Is still possible) of the

obllgation with a right to claim for damages.
Ano ang specific performance - e.g. may contract kayo X and V to build a

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house for u In a span of 6 months. So that Is the obligation of the debtor, now after 6
months di pa natapos or dlpa naslmulan, so as the creditor nagbayad kana lahat patl
down payment, SO WHAT ARE YOUR RIGHTS? DEMAND SPECIFIC PERFORMANCE.
You file a case In court against the obllgor 10 fulfill his obligation. Aside from that you
can claim for danyos or payment for the damages kasl ang tagal at nagflle kapa sa
court.

2. To demand rescission or cancellation with damages

Same e.g. scenario, so ayaw mona lpagpatuloy, ayaw mona yung fulfillment ng
performance so you opted for resciss ion or canc,ellatlon, as the creditor you can
demand the cancellation of the contract with the right of damages kasl nagkaroon ng
breach of contract.

3. Demand payment of damages only, kung yun nalang yung natitirang remedy

NOTE: As a creditor you can only choose one dyan sa mga rights na yan. One excludes
the other.

Art 1 166 The obligation to give a determinate thing Includes that of delivering all Its
accessions and accessories, even though they may not have been mentioned.
- one of the obligations of • debtor Is to deliver the accessions and accessories.

Accessions - the fruits of a thing or additions to or Improvements upon a thing (the

principal).
e.g. house sa land, rents sa bldg., ac sa car

Accessories - are the things joined to or Included with the principal thing for the
latte(s embellishment or completion.
e.g. key of a house, frame of a picture, bracelet of a watch

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AGAIN: Art. 1169

There are 2 terms or connotations when It comes to the concept of delay:

ORDINARY DELAY - eto yung alam natln •ts merely the failure to perform an obligatlon
on time.'

LEGAL DELAY/ DEFAULT/ MORA - Is the failure to perform an obligation on time

which failure constitutes a breach of the obligation.

REMEMBER: An obligor only Incurs In delay If there Is already a judicial and

extrajudicial demand coming from the creditor.

>THREE KI NDS OF DELAY OR DEFAULT

1. Mora solvendi - the delay on the part of the debtor to fulfill his obligation. That
could be an oblig to give or to do.

2. Mora acclpiendi - the delay on the part of the creditor to ·accept• the performance
of the obligation

3. Compensatlo morae - the delay of the obligors In reciprocal obllgatlons

• here both parties are In delay.

>EFFECTS OF DELAY

Generally, If there Is delay, as the obligor, the creditor or the defaulting party Is gullty of
breach of obligation.
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• If ifs Mora solvendl or If ifs Mora acclplendl (1 effect), the person or the party In
default Is guilty of breach of obligation
• 2nd effect. he is liable for damages suffered
• 3"1. he bears the risk of loss, kapag Nawala yung object, he bears the risk.
• 4 th, where the obligation Is to pay money, then there Is no liability for the interest.
• 5th, party may release himself from the obligation, (wala na slyang obligation DAHIL
in default ka naman. On the part of a creditor.)

NOTE: There is no Delay, If th ere Is no Demand.

When we say demand, a demand may either be judicially or extrajudicially.

5 Instances or EXCEPTIONS when demand Is not necessary to put debtor in delay.

1. When the obligation so provides - D promised to pay C 20k on or before December

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2. When the law so provides - tax laws / payment of taxes

3. When time is of the essence - it Is your birthday/wedding on dee 3

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4. When demand would be useless - S obliged him self to deliver a specific horse tas
the horse died - pero kung generic naman yung thing di pa matetermlnate yung
obligation kahtt due to fortuitous events pa dahll maraml namang pwedlng lpaltt doon.

S. When there is performance by a party In reciprocal obligations • both parties have

their respective obligations. E.g. contract of sale. Buyer Is obliged to pay once the
thing or the object has been delivered, at sl debtor naman he Is obliged to deliver once
payment has been made.
Illustration e.g. - A delivered the thing pero di pa nagbabayad sl B sasablhln nlya *eh
wala pa namang demand e, wala pang Judicial or extrajudlclal demand, I'm not yet In
delay.* No. Kaya nga sabl when there Is performance by a party In reciprocal
obligations, kapag nagawa na nang lsang party ang kanlyang obligation, then kapag
hindi mo ginawa yung obligation mo you are already In delay.

REMEMBER: You are not in delay, u r not In default, u r not In mora, IF walang demand.
(that Is general rule) HOWEVER, there are 5 Instances (yung 5 exceptions) when a
debtor/obligor will be considered In delay kahlt walang demand.

A demand Is done either judicially or extraiudlclally.

Art . 1170. Who are liable for damages

"Those who In the performance of their obllgatlona are guilty of fraud, negligence, or
delay and those who In any manner contravena the tenor thereof, are liable for
damages.
4 GROUNDS FOR LIABILITY

1. Fraud (deceit or dolo) - an Intent to deceive someone/ a malicious intent na

manloko.
To Illustrate: S obliged himself to deliver 20 bottles of wine, of a particular brand.
Subsequently, S delivered 20 bottles pero yung cheaper wine lang. S is guilty of fraud
and is liable for damages to B. S is deceiving or Is intentionally evading the normal
fulfillment of an obligation.
Incidental fraud at causal fraud (nvm)

2. Negligence (fault or culpa) - it Is the voluntary omission - failure to perform. failure

to observe - there be no bad faith or malice, which prevents the normal fulfillment of
an obligation.

Quasi- delicts are created or Incurred because of negligence or fault. If you are guilty
of quasklelict. you have a criminal liablllty together with civll liabillty or damages.

3. Delay (mora) - If u r In delay, u r liable for damages.

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4. Contravention of the terms of the obligation - or the tenor of the obligation. - so
kaya nga tayo gumagawa ng kontrata kasl that Is our law. Yun yung batas sa pagltan
natln, pero lkaw slnasadya mo na wag gawln or wag sundln yung terms or conditions
ng obligations mo.

E.G. SI E nagrerent alya ng apartment kay R for 1Ok a month na babayaran niya kada
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1 week of every month. Now, R who Is the landlord Is obliged to keep or maintain a
peaceful possession ni E kasl nga nag babayad naman slya ng rent. Kapag etong sl R
will violate his obligation or he will eject al E ne lessor nlya from his premises. SI Ena
nagrerenta, e pwedeng maghabol ng damages key R.

}So these 4 cases, if done, you will be accountable or you will pay for damages.

Art. 1171 Responsibility arising from fraud is demandable In all obligations. Any
waiver of an action for future fraud Is void. (by reason of public policy.)

lblgsablhln, If you enter Into a contract. hlndl mo pwedeng I-stipulate doon na you are
waiving your right to file for a claim or magsampa ng kaso In case of future fraud
(because that Is a violation of public policy).

Art . 1172. Responsibility arising from negligence

NEGLIGENCE. If you fall to perform that ordinary dlllgence that Is expected from you,
or u failed to employ that degree of dlllgence or skill that Is demanded by the
circumstances, - kapag driver ka of any vehicle, u r expected to have that skill and
that foresight and u should be careful and vigilant.

If you are negligent, and you cause any Injury or any damages to another, then u are
Hable for damages.
>KINDS OF NEGLIGENCE
1. Contractual negligence - in case of breach of contract
2. Civil negligence - eto ung quasi-contracts, yung kahit wala kayong pinag usapan or
kontrata
3. Criminal negligence - delict, quasl-dellcts, you are Hable for damages.

We also have t he concept of "CONTRIBUTORY NEGLIGENCE"

- paano naman, aside from your negligence, may negligence din yung laang party.
Pwede mo bang sablhln na, wala na akong kasalanan dahil alya rln naman
nagcontrlbute. she has a contributory negligence.
Tama bang sablhln na exempted ka na sa liablllty? Kasi the other party has also
contributed to the negligence? NO. Hindi lyon lkakawala ng lyong responsibility for

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damages or for criminal punishment.
Ang maglglng epekto lang ng contributory negligence Is lie-lessen lang nlya or
mababawasan yung obligation mo for damages. lte-temper lang yun ng court.

(Ma'am might ask this question In the recitation)

What Is the effect of contributory negligence to the llablllty for damages?
Answer: The negligent party Is still liable, only that his llablltty for damages will be
lessened or will be tempered.

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When we say damages, it talks abou1 money. Of course, It's not money itself because
damages deals with a more comprehensive concept. It's not Just money.

>THERE ARE 6 KINDS OF DAMAGES UNDER THE CIVIL CODE

1. Actual or Compensatory - when we say actual damages, these are those wc u

could prove. For e.g. if that is an accident, actual damages is, if he was hospitalized
with the hospital bills, hospital receipts, the expenses for the medications, the
expenses for medical procedures na inundergo ng victim. Or eventually that person
has expired, pag namatay, yung funeral expenses, coffin, etc. - THE AMOUNT SPENT
FOR THE WAKE AND THE BURIAL.
Actual damages is the amount of damages that Is actually supported by receipts.

2. Moral Damages - this Includes physical suffering, mental anguish, anxiety,

besmirch reputation (napahlya ka) or social humlllatlon and the like. Tho it Is,
Incapable of chuchu esti mation, we could not actually evaluate it Into money. the
th ings that are to be considered here would be the age. the social status of a person,
his earning capacity. and his profession.

When It comes to moral damages, there Is no hard and fast through In determining
kung magkano yung fair or reasonable amount for moral damages. so It would depend
on the circumstances that are attending the how the Injury, or the damage. or the
breach of contract was Incurred.

3. Nomi nal Damages - are recoverable If no actual substantial or specific damages

were shown to have resulted In the breach. This would depend on the sound discretion
of the court whether or not to award nominal damages. (They are often awarded only
to establish that the defendant acted wrongfully.)
Kung ang moral damages ay walang specific na batayan, mas lalo na tong nominal
damages.
it is for the purpose of indemnifying the loss. Nawala mo or the pecuniary loss na
walang financial interest mo brought about by the negligence or the bad faith or the
omission or the failure to or the fraud undertaken by the person who brought about
the damages.

4. Temperate - these are. for the pecuniary loss, the court knows that indeed na u
suffered pecuniary loss. however. the amount could not be ascertained. Kung baga
slam kong may Nawala sayo kaso hlndl natln masasabl kung magkano. So the court,
In the Interest of Justice would award temperate or moderate damages to cover that
loss or Injury that u have suffered.

5. Llqul dated Damages - these are the damages which are stipulated In the contract

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and which Is awarded In case of breach. kapag hlndl ka tumupad sa usapan. sa
kontrata then liquidated damages will be awarded.

6. Exemplary or corrective damages - these are Imposed bv wav of example or

correction for the public good.

It's for the correction of the public para wag tularan.

These are usually awarded in case of blatant breach of obligation or in heinous crimes.
Like I told u it's not just only in negligence or in fraud or in breach of contract that u
will be liable for damages but likewise in the commission of the crime.
Pag nanaksak ka ng tao, it will not just be imprisonment but likewise ur liable for
damages.
[NOTE: Damages are to be proven. So hindI mo pweding I-claim na •1 am entitled
damages• and so that's it. No. You have to prove your claim for damages, EXCEPT for
EXEMPLARY because that is upon the sound discretion of the court and likewise as
NOMINAL and TEMPERATE. But for actual damages and moral damages. as a
claimant, u must prove your basis for such claim.]

Again, I will repeat the CONCEPT OF BAD FAITH.

In civll law, you will always hear the concept of good faith and bad faith.
GOOD FAITH - that Is honesty. The observance of honesty in the performance of
one's obligation.

BAD FAITH - Imports a dishonest purpose. Or the doing of a wrong that partakes the
nature of fraud. Deceit.

The Concept of Negligence

If you have committed the act of negligence, then you are likewise liable for damages
due to negligence.

Negligence - is the omission of the diligence which is required by the nature of the
obligation and corresponds with the circumstances of the person of the time and the
place.
• negligence is the absence of criminal Intent. Wala kang criminal na intention
PERO dahil sa kapabayaan, or lack of skill or you failed to exercise due dillgence and
you have injured or created an injury or loss to another then you are ilable for that
Injury or loss. Not because slnsdya mo or glnusto mo but dahil sa hlndi mo paa linaat
Your failure to observe due diligence In whatever conduct that u have undergone.

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- so we are now clear on the nature and effects of obligation. Those who are Hable
for damages. The kinds of damages that could be awarded under the clvil code and
we have 6 of this.

Art . 1173 & 1174

The concept of fortuitous events

FORTUITOUS EVENT - this term Is used Interchangeably/synonymous with Acts of

man or Acts of God

A fortuitous event Is an event wh ich cannot be foreseen, although foreseen, Is

inevitable.
fortuitous event - these are extraordinary events that are not foreseeable or not
avoidable.
So bat natin inaalam ang concept ng fortuitous event.

Kasi If the cause for the failure to perform your obllgatlon Is due to a fortuitous event,
generally, u are released from your obligation (pero there are exceptions)

Again, remember, kapag fortuitous event, it could exempt you from liability, or it could
release u from ur obllgatlon.

>THERE ARE lWO CONCEPTS UNDER fortuitous event

1. Acts of man - force majeure, these are riots, wars, fire

2. Acts of God - these are natural occurrences such as floods or typhoons.

If these are the reason kung baklt hlndi mo nagawa ang lyong obligasyon, generally,
wala kang obllgasyon sa batas, and that ur obllgatlon may be tenninated.

>KINDS OF FORTUITOUS EVENT

1. Ordinary fortuitous events •

2. Extra-ordinary fortuitous event - events that are uncommon and could not
reasonably be foreseen.

- these could be llke fire, war, pandemic, earthquake,

etc.

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>The elements/ requisites of a fortuitous event

(take note of these kasl these are the basis/standards that are to be obser1e before
an event could be classlfled as a fortuitous event.)

1. The event must be Independent of the human will. Meaning, walang human
contribution or participation, IT'S ALL NATURAL.
2. The event must have been Impossible to foresee, or If foreseen, Is Inevitable. Hindi
daw natin mafo-foresee or mappredlct, ang tho can be predicted, It is impossible to
avoid. E.g. typhoon
3. The occurrence/ event must be of such a character as to render It Impossible for the
debtor to fulfill his obligation in a normal manner. - Meaning fortuitous event would
render the obliger. It would be difficult for u to perform it in a normal manner.

4. The obliger must have been free from any participation In the aggravation of the
resulting injury.
In short, the obliger must not have been negligent or there was no misconduct
committed that have brought about the occasion of the loss. (Wala alyang
contribution or any act of misconduct that could have helped produce the loss
suffered by the complainant.)

Take note that for the obliger to be exempt from the llabllity, It Is required that he has
not committed negligence or misconduct.
So dapat hindi ka rfn naging pabaya.
To illustrate:

A is bound to deliver a specific object to B and that is a black stallion. Now, the day
before the date of delivery, there was a bad weather, so it was forecast that there is a
typhoon coming. Then A. pinabayaan lang niya yung horse sa may creak and
eventually umapaw yung tubig sa creak, nalunod ung black stallion. Can A claim
exemption from liability due to fortuitous event? No, of course. Kasi yes nagkaroon ng
fortuitous event but A also comm ltted negligence. You can only totally be exempted
from the liability IF u were not negligent.

A had been negligent kasl nga alam na nlyang there Is a typhoon pero lntwan lang
nlyang nakatall sa may creak yung horse.

Hence, A Is not exempted from liablllty. He Is liable for damages equal to the amount
of the black stallion.

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Another Illustration:

If the obligation Is to pay money. Utang. Could u say that due to the occurrence of
pandemic you are exempted na dun aa obligation?

Yea pandemic Is a fortuitous event. However, money la generic hlndl specific so

pwede slyang palltan lagl.

So In case of fortuitous event, the obligation to pay money Is not extinguished.

Magbayad ka parin.
- So that is the concept of fortuitous event-

AGAIN, GENERAL RULE: No person shall be responsible for

fortuitous event. (BUT there are exceptions to this rule.)
A person is not liable for loss or damage caused to another from the nonperformance
of his obligation due to fortu itous events.

HOWEVER,
We have 3 Instances w herein a per son Is still liable In c ase of fortuitous event

1. When expressly specified by law - kapag slnabl daw ng batas na liable ka parln.
So under this, there are 4 special strictness na sabl ng law
a. If the debtor is guilty of fraud, negligence, or delay, or contravention of the
tenor of the obligation.
- so sabl nga kapag you're In delay u are liable for damages.

b. when the debtor has promised to deliver t he same (specific) thing to two or
more persons.

- This Is again, deceit.

c. the obligation to deliver a specific thing arises from a crime .

- from a crime. Ang obligation mo ay dahll sa lyong criminal liablity.
- e.g. sl A nlnakaw nlya yung kalabaw nl B, so sl A may obligasyon slyang
lbalik yung kalabaw kas Inga nlnakaw nlya. So kapag namatay yung kalabaw, so he
was sentenced, he was found guilty, alnabl lbalik nlya yung kalabaw pero hlndl na nlya
malbalik kaal let's say nalunod or nakldlatan, then A la STILL liable kasl yung
obligation nlya to give the carabao arose from a crime. So hlndl ka parln exempted
(even If the happening of the nonperformance Is due to fortuitous event).

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 d. the thing to be delivered Is generic.
• generic naman kaya pwedeng pwede mong palitan. Pwedeng
pwede paring mag-comply ung debtor dun aa obllgatlon nlyang 1-dellver yung generic
thing na yon.

2. When declared by stipulation - kung ano yung andun aa kontrata nlnyo. Kase take
note, In a contract. two parties can agree, make atlpulatlona/conditlona na kung anong
gusto nlla as long as it's not contrary to law, customs, and morals.

3. When the nature of the obligation requires the assumption of risk - ano yung
obllgasyon na ang trabaho mo ay u are assuming rtsk, INSURANCE. Kasi bat ba natln
ine-ensure ang sting buhay, kasi may risk, risk na mamatay ka o maaksidente ka. Sa
sasakyan, bat natin ine-ensure? Kasi pwedeng mabungo o madisgrasya. - So ngayon,
kapag ba fortuitous event, sasablhln ng Insurance company naten na, •ay, ayoko kasl
fortuitous event naman yan, Im not liable." NO. kasi ang nature ng obligation is the
assumption of risk.
- So these are the three rules or Instances wherein kahll na ang dahilan for failure to
perform ay fortuitous event. the obllgor Is stlll llable.

Next lesson la Art. 11 75 ( vld lecture/lesson 5)

• Loan/Simple loan
- deals with the concept of Interest

1179 - pure obligation

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Art. 1175. Usurious transactions shall be governed by special laws.

The law on Usury has already been suspended by the Bangko Sentral.
•Art.lcle 1175 and 1176 talks about simple loan In relatlon to the collecuon or stipulation o f
lntareal

(Stipulation - a cond it ion or requirement that Is specified or demanded as part an agreement.)

(Usury - Is contracting for or receiving Interest In excess of the amount allowed by law for the
loan or use of money, goods, chattels, or credit)
(Gratuitous - given or done free of charge.)
(Presumption - ii is an idea that is taken to be true, and often used as the basis for other
ideas, although it is not known for certain.)

Simple Loan - is a contract where one of the parties delivers money or other consumable
thing upon the condition that the same amount of the same kind and quality shall be paid. It
may be gratuitous or with a stipulation to pay Interest. (ok so, utang. 2 lang yan. Walang
Interest or with Interest.)

(Kung walang stipulation of Interest, no problem. [take note of the concept of Interest (both as
a lender or as a debtorD

Requisites for recovery of Interest

1. The payment o f interest must be express ly 8tl pul11ted.

• there Is an txpre11ed stlpulatlon.
• kung bage nasa agreement/kontrata nlyong dalawa.
• kahlt na may written contract, kung wale namang slnabl dun sa k.ontrata na
magbbear ng lnterelt yung lpapahlram mong pera, It's fine kung magabbayad lang sl debtor
nung amount na hlnlram nlya at walang kasamang Int erest kasi nga It's not stipulated In the
contract.

So make sure na as a lender, It is written para makacollect ka (ng Interest).

On the part of the borrower naman, if it's not written there or stated in the stipulation, then u
don't have the obligation to pay interest.

WHATEVER IS NOT INCLUDED, IS DEEMED EXCLUDED

2. The agreement must be In writing
• kung ang agreement nlnyo ay verbal lang, as a lender, you cannot legally
demand the payment of Interest.
3. The Interest must be lawful

Art. 1176. The receipt of the princip al by the creditor, without reservation with respect to the
Interest, shall give rise to the presumption that said Interest has been pa id.

Slnasabi dito, Diba pag nagpautang ka, diba ang unang babayaran Is interest muna bago yung

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principal so never commit the mistake na tatanggapln mo yung principal and then soon nalang
yung Interest. NO. Unless you make a clear reservation na tlnatanggap mo muna yung
principal pero may obllgasyon pa siya sa Interest. Kaai look at the article 1176, It states there
that. If you receive the principal without reservation of the payment of the Interest. than,
mayroong presumption na bayad na yung Interest. So that la not favorable to the lender. Kaai
may presumption nga e, Unless there la a clear reservation. Kapag tayo ang nagpautang at
mayrong Interest, make sure to collect the Interest first ahead of the principal.
(The second paragraph under Alt. 1176)
The receipt of a later Installment of a debt without reservation as to prior Installments, shall
likewise raise the presumption that such Installments have been paid.
Eto naman, when it comes to "Installments•-
e.g.
Ang usapan niyo is, ang utang is 120K payable in a year, so that is 1OK monthly.
Ngayon, syempre monthly ang payment nyan, NOW, kapag tinanggap mo ang payment-
Hindi siya nagbigay ng payment for January, tapos ang sabl niya, iblbigay muna yung payment
for February kasl February na, pero yung January saka nalang. Kumbaga nagjump slya, lkaw
naman tinanggap mo.
KAPAG tlnanggap mo yung mga latter Installments, without clearty reserving the fact that the
previous Installments were not given, then there I• llkewlae II preeumptlon na bayed na. Kaai It
Is logical, kasl magbabayad ka ng march or April, edl yung Jan at Feb, bayed na.
So kung ganun yung gagawln nlnyo, mue sure that there Is a clear reservation na kapag
nagdefault slya ng lnatallmanta, and then blgla elyang magjjump sa latter Installments, wag
kayong papayag.
Kasi kung ang reslbo mo ay march at April and then later on magkkwentahan kayo at wala
kang malpakitang reslbo ng Jan at feb, ang presumption dyan Is bayed yung Jan at feb kael ang
reslbong plnapakita mo ngayon Is march na.
(Take note: Sa loans, payment of interest, and Installments. paper trails lahat yan ibigsabihin,
there will be documents that show the series or chain of transactions.)

Art. 1178. The transmissibllity of rights

Subject to the laws. all rights acquired in virtue of an obligation are transmissible, if
there has been no stipulation to the contrary.
lbigsabihin nito, whatever rights we have, right to collect. right to receive, or an obligation to
pay, ARE TRANSMISSIBLE. Nalpapasa natln sa Iba.
However. there are prohibitions. (Mayrong mga rights na hlndl tranamlsslble)
e.g.
(1) Sa mga contract of partnership. -that la personal e. It la purely personal In character.
So If the partner resigns or If the partner dies. the partner cannot assign membership In the
partnership.

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(2) In a contract of agency,
Kapag lkaw yung agent or principal, once u die, your relatlonahlp Is dNmed terminated.
Because death Is one of the rounds for the termination of the contract of each party.
(3) Or prohibited by law or Prohibited by stipulation

Pero Generally, all rights are transmissible.

e.g.
Your parents, In their lifetime, are creditors to your neighbor. So meron silang agreement or
contract of loan.
So when your parents die, yung rights ng parents mo to collect yung utang ng neighbor niyo
can be transmitted to you na anak nila, so pwede mong kolektahin.
In the same manner, kung yung parents mo yung may utang sa iba, it can be transmitted to
you.

e.g.
Your parents left money In the bank, or properties thet could be aold, kung mabenta nlnyo,
dapat yung mapagbentahan, portions of that will go to their obUgetlon when they were still
alive. Because~ Is one of the kinds of the transmlsslble right or transmissible obligation.

Now let's go to CHAPTER 3: THE CLASSIFICATIONS OF OBLIGATIONS (Different kinds of

obligat Ion)

(maramlng uri ng obUgatlon pero ang lddlscuss ay yung 6 primary classlflcatlon of obligations
(Jang) under the Civil Code:

1. Pure and Condlional Obligations (Art. 1179)

2. Obligations with a Period (Art 1193)
3. Alternative (Art. 1199) and Faculative Obligations (Art. 1206)
4. Joint and Soidary Obligation s (Art. 1207)
5. Divisible and lndivisb le Obl gations (Art 1223)
6. Obligations with a Penal Cl ause (Art . 1226)

The first kind (Pure and Conditional Obligations) Is discussed under Article 1179.

Art. 1179. Every obligation whose performance does not depend upon a future or uncertain
event, or upon a past event unknown to the parties, Is demandable at once.

Ok. this Is pure obligation.

Ang Pure Obligation Is one which la not subject to any condition and no specific date Is
mentioned for Its fulfillment and Is, thefefore, Immediately demandable.

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So ang pure obligation, from the word pure, - la not subject to any condition or period
(likewise) then It Is demandable at once.
e.g.
A obliged himself to pay B the amount of 1K. ok yun Ieng. I promise to pay B the amount of 1K.

Walang period, walang condition. IT IS DEMANDABLE AT ONCE.

However, pano mo malalaman kung kelan slya magbbayad.
So sabl, it is payable upon demand.
[So again, PURE OBLIGATION SIYA, kasi wala slyang condition, wala siyang period.
So kailan magddue o magbabayad? Upon demand.)
Kung sinabi ni B na •A you have to pay your debt at the end of march." So that is the period
when A have to pay B.

As opposed to Pure obligation,

A Conditional Obligation (from the word Itself, conditional or •condition")
- Is one whose consequences are subject In one way or another to the fulfillment of a
condition.
So ta conditional obligation. mayroong nakatayang kondlsyon. Na kapeg hlndl nangyarl yung
condition, there Is no rise of the obllgatlon.
What Is the meaning of a condltlon?
Condition - Is a future and uncenaln event, upon the happening of which, the effectlvlty or
extlngulshment of an obligation (or right) subject to It depends.
-So ang condition ay lsang future event na hlndi mo alam kung mangyayarl o kallan
mangyayari kung mangyayari man Ito.
FUTURE OR UNCERTAIN OR PAST BUT UNKNOWN (nangyari na pero hindi ninyo alam)

e.g.
Sa courting,
sasabhln nung girl, nsagutln kite kapag grumaduate ka or pag napasa mo yung board exam.
- so the condition there Is you passing the board examination, It la a future and an uncenaln
event. (uncenaln kasl di naman sure kung papasa or makakagraduat.e ka.)
So that la condition.

And there are 2 kinds of Condition

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