ALIÑO, Hannah Marie M.

February 7, 2022
BSMAC 1-D The Law on Obligations and Contracts

STANDALONE ASSIGNMENT

Study Guide No. 1

True or False. Briefly explain your answer.

1. A civil action is one in which a party sues another for the enforcement or protection of a
right or the prevention or redress of a wrong.

True. Civil law today is very much important because it is to provide the foundations
for legal institutions, doctrines, and transactions at the basis of civil society and
commercial law while balancing private rights with legal obligations and
responsibilities.

2. There is negotiorum gestio when the property or business is not neglected or

abandoned.

False. Negotiorum gestio does not arise when the property or business is not neglected
or abandoned. Negotorium gestio only arise when:

1. The gestor must voluntarily assume the agency or management of the business
or property of another.
2. The business or property must be either neglected or abandoned.
3. The agency or management must not be authorized by the owner either
expressly or impliedly.
4. The assumption of the agency or management must be made in good faith.

3. An obligation “to give” is a presentation that consists of the delivery of a movable or an

immovable thing.

True. To give – consist in the delivery of a movable or immovable thing, to create a real
right or for the use of the recipient or its simple possession, or to return to its owner.

4. There is negotiorum gestio when the manager has been tacitly authorized by the owner.

False. Negotorium Gestio does not arise if in fact the manager has been tacily
authorized by the owner.

5. An obligation “to do” includes all kinds of work or service.

 True. The prestation to do is a positive personal obligation. It includes all kinds of work
or service. An example of this would be the obligation of a painter to create an artwork
for the person who commissioned him.

6. For every right enjoyed by any person, there is a corresponding obligation on the part
of another person to respect such right.

True. An obligation is defined in the Civil Code as a juridical necessity to give, to do or

not to do. For every right enjoyed by any person, there is a corresponding obligation on
the part of another person to respect such right.

7. Diligence is the failure to observe the degree of care, precaution, and vigilance that the
circumstances justly demand.

False. Negligence is the failure to observe for the protection of the interests of another
person, that degree of care, precaution and vigilance which the circumstances justly
demand, whereby such other person suffers injury. (Judge Cooley)

8. A right is a power, privilege, or immunity guaranteed under a constitution, statute, or

decisional law, or recognized as a result of long usage, constitutive of a legally
enforceable claim of one person against the other.

True. However, the exercise of rights is not without limitations. Having the right should
not be confused with the manner by which such right is to be exercised. According to
Article 19 of the Civil Code precisely sets the norms for the exercise of one’s rights:

Art. 19. Every person must, in the exercise of his rights and in the performance of his
duties, act with justice, give everyone his due, and observe honesty and good faith.

When a right is exercised in a manner which discards these norms resulting in damage
to another, a legal wrong is committed for which actor can be held accountable.

9. Obligations arising from contracts have the force of law between the contracting parties
and should be complied with in good faith.

True. Obligations arising from contracts have the force of law between the contracting
parties and should be complied with in good faith. Unless the stipulations in a contract
are contrary to law, morals, good customs, public order or public policy, the same are
binding as between the parties.

10. A defendant is a party who brings a civil suit in a court of law. He is the person who files
the complaint in court.

False. The Plaintiff is the person who files the complaint in a civil lawsuit. The Plaintiff
will Plea- In a criminal case, the defendant's statement pleading "guilty" or "not guilty"
in answer to the charges in open court.
Answer the following:

1. Why is an obligation considered a juridical necessity?

An obligation is a juridical necessity because in case of noncompliance, the courts of

justice may be called upon by the aggrieved party to enforce its fulfillment or, in default
thereof, the economic value that it represents. In a proper case, the debtor or obligor
may also be made liable for the damages, which represents the sum of money given as a
compensation for the injury or harm suffered by the creditor or obligee (he who has the
righy to the performance of the obligation) for the violation of his rights.

In other words, the debtor must comply with his obligation whether he likes it or not;
otherwise, his failure will be visited with some harmful or undesirable consequences. If
obligations were not made enforceable, then people can disregard them with impunity.
There are, however, obligations that cannot be enforced because they are not
recognized by law as binding.

2. When is the obligation considered personal?

Obligation is considered personal when obligation to do or not to do; is that in which

the subject is an act to be done or not to be done.

3. What are the duties of a person who is obliged to give a determinate thing?

1) Preserve the thing. — in obligations to give (real obligations), the obligor has the
incidental duty to take care of the thing due with the diligence of a good father of a
family pending delivery.

a) Diligence of a good father of a family. — The phrase has been equated with
the ordinary care or that diligence which an average (a reasonably prudent)
person exercises over his own property.
b) Another standard of care. —However, if the law or the stipulation of the
parties provides for another standard of care (slight or extraordinary
diligence), said law or stipulation must prevail. (Art. 1163.)
c) Factors to be considered. — The diligence required necessarily depends upon
the nature of the obligation and corresponds with the circumstances of the
person, of the time, and of the place. (Art. 1173.) It is not necessarily the
standard of care one always uses in the protection of his property. As a
general rule, the debtor is not liable if his failure to preserve the thing is not
due to his fault or nigligence but to fortuitous events or force majeure. (Art.
1174.)
d) Reason for debtor’s obligation. — The debtor must exercise diligence to
insure that the thing to be delivered would subsit in the same condition as it
was when the obligation was contracted. Without the accessory duty to take
 care of the thing, the debtor would be able to afford negligent and he would
not be liable even if the property is lost or destroyed, thus rendering illusory
the obligation to give (8 Manresa, 35-37.)

2) Deliver the fruits of the thing. — When obligation to deliver fruits arises:

a) Generally, the obligation to deliver the thing due and consequently, the fruits
thereof, if any, arises from the time of the “perfection of the contract.”
Perfection, in this case, refers to the birth of the contract or to the meeting of
the minds between the parties. (Arts. 1305, 1315, 1319.)
b) If the object is subject to a suspensive condition or period (Arts. 1179, 1189,
1193.), it arises upon the fulfillment of the condition or arrival of the term.
However, the parties may take stipulation to the contrary as regards the right
of the creditor to the fruits of the thing.
c) In a contract of sale, the obligation arises from the perfection of the contract
even if the obligation is subject to a suspensive condition or a suspensive
period where the price has been paid.
d) In obligations to give arising from law, quasi-contracts, delicts, and quasi-
delicts, the time of the performance is determined by the specific provisions
of the law applicable.

3) Deliver the accessions and accessories. — The general rule is that all accessions
and accessories are considered included in the obligation to deliver a determinate
thing although they may not have been mentioned. This rule is based on the
principle of law that the accessory follows the principal. In order that they will be
excluded, there may be a stipulation to that effect.

Unless otherwise stipulated, an obligation to deliver the accessions or accessories of
a thing does not include the latter. Thus, a sale of the improvements upon a land is
not sufficient to convey title or any right to the land. But the lease of a building or
house naturally includes the lease of the lot in which it is constructed for the
possession of the lot is implied in the lease of the improvement.

4) Deliver the thing itself. — A thing is a generic or inditerminate when it refers only
to a class or genus to which it pertains and cannot be pointed out with particularity.

a) A determinate thing is identified by its individuality. The debtor cannot

substitute it with another although the latter is of the same kind and quality
without the consent of the creditor. (Art. 1224.)
b) A generic thing is identified only by its specie. The debtor can give anything
of the same class as long as it is of the same kind.

5) Answer for damages in case of non-fulfillment or breach. — There is a breach

when a person fails or infuses to perform his obligation without legal justification.
 a) Fraud (deceit or dolo). — As used in Article 1170, it is the intentional evasion
of the normal fulfillment of an obligation. As a ground for damages, it implies
some kind of malice or dishonesty and it cannot cover cases of mistake and
errors of judgment made in good faith. It is synonymous with bad faith, in
that, it involves a design to mislead or deceive another.
b) Negligence (fault or culpa). — It is any voluntary act or omission, there being
no bad faith or malice, which prevents the normal fulfillment of an obligation.
c) Delay (mora). — The word delay, as used in the law, is not understood
according to its meaning in common parlance. A distinction, therefore,
should be made between ordinary delay and legal delay (default or mora) in
the performance of an obligation.
• Ordinary Delay is merely the failure to perform any obligation on time.
• Legal Delay or Default or Mora is the failure to perform any obligation on
time which failure constitutes a breach of the obligation.
d) Contravention of the terms of the obligation. — This is the violation of the
terms an conditions stipulated in the obligation. The contravention must not
be due to a fortuitous event or force majeure. (Art. 1174.)

4. When does the creditor acquire a real right over the thing?

The creditor is entitled to the fruits of the thing to be delivered from the time the
obligation to make delivery arises. The intention of the law is to protect the interest of
the obligee should the obligor commit delay, purposely or otherwise, in the fulfillment
of his obligation.

5. What are the different kinds of fruits in law?

a. Natural Fruits - They are the spontaneous products of the soil and the young and
other products of animals (Art. 442). Examples: trees that naturally grow. Young
and other products of animals. As a result, natural fruits are divided into two
categories:

1. the spontaneous products of the soil.

2. the young and other products of animals.

In the case of the natural fruit, the first kind, it is required that it be a spontaneous
soil product. As a result, no human work must have been involved in its creation.
When human labor is used in the production of fruit, it is referred to as an industrial
fruit.

b. Industrial Fruits - Industrial fruits are those produced by lands of any kind
through cultivation or labor (Art. 442). Examples: corn and other crops, rice, other
products that are a result of cultivation and intervention of human labor. A fruit
must meet two characteristics to be categorized as an industrial fruit:
 1. it is produced by the land; and
2. it is produced through cultivation or labor.

c. Civil Fruits -They are the result of a juridical relation such as the rents of buildings,
the price of leases of lands and other property, and the amount of perpetual or life
annuities or other similar income (Art. 442).

The income or revenues derived from the property itself, on the other hand, are
known as civil fruits. As a result, a dividend, whether in cash or stock, is considered
civil fruit because it is paid from a corporation's profits rather than its capital stock.

6. Distinguish personal right from the real right.

a) In Personal Right there is a definite active subject and a definite passive subject,
while in the real right, there is only a definite active subject without any definite
passive subject.
b) A Personal Right is, therefore, binding or enforceable only against a particular
person, while a real right is directed against the whole world.

7. What are the remedies of the creditor in case the debtor fails to deliver the determinate
thing he has promised to deliver?

In a specific real obligation (obligation to deliver a determinate thing), the creditor may
exercise the following remedies or rights in case the debtor fails to comply with his
obligation.

a) Demand specific performance of fulfillment (if it is still possible) of the

obligation with a right to indemnity for damages; or
b) Demand rescission or cancellation (in certain cases) of the obligation also with a
right to recover damages (Art. 1170.); or
c) Demand payment of damages only, where it is the only feasible remedy.

In an obligation to deliver a determinate thing, the very thing itself must be delivered.
(Art. 1244.) Consequently, only the debtor cam comply with the obligation. This is the
reason why the creditor is granted the right to compel the debtor to make the delivery.
(Art. 1165, par. 1)

It should be made clear, however, that the law does not mean that the creditor can use
force or violence upon the debtor. The creditor must bring the matter to court and the
court will be the one to order the delivery.

8. What are the remedies of a creditor in case of non-fulfillment of an obligation to deliver

a generic thing?

A generic real obligation (obligation to deliver a generic thing), on the other hand, can
be performed by a third person since the object is expressed only according to its family
 or genus. It is, thus, not necessary for the creditor to compel the debtor to make the
delivery, although he may ask for performance of the obligation. In any case, the
creditor has the right to recover damage under Article 1170 in case of breach or
violation of the obligation.

The manner of compliance with an obligation to deliver a generic thing is governed by

Article 1246.

9. Distinguish accessions from accessories.

a. Accessions are fruits of a thing or additions to or improvements upon a thing (the

principal).
b. Accessories are things joined to or included with the principal thong for the latter’s
embellishments, better use, or completion.

While accessories are not necessary to the principal thing, the accessory and the
principal must go together. Both can exist only in relation to the principal. Accession is
also used in the sense of a right, right to the fruits and/or accessories of a thing.

10. What are the remedies of the creditor in positive personal obligation?

1. If the debtors fail to comply with his obligation to do, the creditor has the right:
a. To have the obligation performed by himself, or by another, unless personal
considerations are involved, at the debtor’s expense; and
b. To recover damages. (Art. 1170.)
2. In case the obligation is done in contravention of the terms of the same or is poorly
done, it may be ordered (by the court upon complaint) that it be undone if it is still
possible to undo what was done.

11. What are the remedies of the creditor in negative personal obligation?

In an obligation not to do, the obligor has to abstain from an act. Here, there is no
specific performance. The very obligation is fulfilled in not doing what is forbidden.
Hence, in this kind of obligation, the debtor cannot be guilty of delay. (Art. 1169.)

As a rule, the remedy of the obligee is the undoing of the forbidden thing plus damages.
(Art. 1170.) However, if it is not possible to undo what was done, either physically or
legally, or because of the rights acquired by third persons who acted in good faith, or for
some good reason, his remedy is an action for damages caused by the debtor’s violation
of his obligation.

12. What is a legal delay?

Legal Delay or Default or Mora is the failure to perform any obligation on time which
failure constitutes a breach of the obligation.
 a. What are the requisites of legal delay?

There are three (3) conditions that must be present before mon solven can exist or
its effects may arise:

1. Failure of the debtor to perform his (positive) obligation on the date agreed
upon;
2. Demand (not mere reminder or notice) made by the creditor upon the debtor to
comply with his obligation which demand may be either judicial (when a
complaint is filed in court) or extrajudicial (when made outside of the court,
orally or in writing); and
3. Failure of the debtor to comply with such demand.

The above presupposes that the obligation is already due or demandable. (see Art.
1279[4].) The burden of proven that demand has been made. Similarly, it is
incumbent upon the debtor to prove that the delay was not caused by his fault to
relieve himself from liability.

13. When is a debtor considered in delay?

As a general rule, delay by the debtor begins only from the moment a demand, judicial
or extra-judicial, for the fulfillment of the former’s obligation is made by the creditor.
Without such amount, the effect of default will not arise.

14. When is demand not necessary for a delay to exist?

1) When the obligation so provides.

2) When the law so provides.
3) When the time is of the essence.
4) When the demand would be useless.
5) When there are performance by a party in reciprocal obligations.

15. In the case of reciprocal obligations, when is a party considered to be delayed?

In case of reciprocal obligations, the performance of one is conditioned upon the

simultaneous fulfillment on the part of the other. So neither party incurs in delay if the
other does not comply or so is not ready to comply in a proper manner with what is
incumbent upon him. This is compensatio morae.

From the moment, however, a party fulfills or is ready to fulfill his obligations, delay by
the other begins.

16. Distinguish casual fraud from incidental fraud?

Article 1170 refers to incidental fraud (dolo incidente) committed in the performance of
an obligation already existing because of contract. It is to be differentiated from casual
 fraud (dolo causante) or fraud employed in the execution of a contract under Article
1338, which vitiates consent.

17. Define the following:

a. Fraud (deceit or dolo)- As used in Article 1170, it is the intentional evasion of the
normal fulfillment of an obligation. As a ground for damages, it implies some kind of
malice or dishonesty and it cannot cover cases of mistake and errors of judgment
made in good faith. It is synonymous with bad faith, in that, it involves a design to
mislead or deceive another.
b. Negligence (fault or culpa)- It is any voluntary act or omission, there being no bad
faith or malice, which prevents the normal fulfillment of an obligation.
c. Fortuitous event- an event of natural or human origin that could not have been
reasonably foreseen or expected and is out of the control of the persons concerned
(as parties to a contract).
d. Delay- The word delay, as used in the law, is not understood according to its
meaning in common parlance. A distinction, therefore, should be made between
ordinary delay and legal delay (default or mora) in the performance of an
obligation.

• Ordinary Delay is merely the failure to perform any obligation on time.

• Legal Delay or Default or Mora is the failure to perform any obligation on
time which failure constitutes a breach of the obligation.

18. What are the two kinds of presumptions under the law?

My presumption is meant the inference of a fact not known arie from its usual
connection with another which is known or proved.

Two kinds of presumption:

1. Conclusive Presumption- one which cannot be contradicted, like the

presumption that everyone is conclusively presumed to know the law (see Art.
3.); and
2. Disputable (or rebuttable) Presumption- one which can be contradicted or
rebutted by presenting proof to the contrary, like the presumption established in
Article 1176.

19. What are the remedies of the creditor against the debtor in case the latter does not
comply with his obligation?

a) Sue the debtor for collection;

b) Attachment of debtor‘s property, real or personal, except those which are
exempt from execution;
 c) Exercise all the rights and actions which the debtor may have against third
persons, except those which are inherently personal to the debtor;
d) To impugn or contest acts of debtor which are intended to defraud his creditor
(Action pauliana);

20. What is meant by transmissibility of rights?

All rights acquired in virtue of an obligation are generally transmissible or assignable.

The exceptions to this rule are the following:

1. Prohibited by Law- When prohibited by law like the rights in partnership, agency,
and commondatum which are purely personal.

a. By the contract of partnership, two pr more persons bind themselves to

contribute money, property, or industry to a common fund, with the intention of
dividing the profits among themselves. (Art. 1767.)
b. By the contract of agency, a person binds himself to render some service or to do
something in representation on or behalf of another, with the consent or
authority of the latter. (Art. 1868.)
c. By the contract of commondatum, one of the parties delivers to another
something in representation not consumable so that the latter may use the same
for a certain time and return it. Commondatum is essentially gracious. (Art.
1933.)

2. Prohibited by stipulation of the parties- When prohibited by the stipulation of the

parties, like the stipulation that upon the dearth of the creditor, the obligation shall
be extinguished, or that the creditor cannot assign his credit to another.

Such stipulation, being contrary to the general rule, must be proved, or, at very least,
clearly implied from the wordings or terms of the contract itself.

Source:

www.lawphil.net
www.barmentor.ph

De Leon, H.S., De Leon, H.M. Jr.,.(2014). The Law on Obligations and Contracts. Rex Book
Store.