Note: I do not claim ownership or copyright for the ff. Effect of loss or deterioration thru negligence, delay or fraud of obligor: a)    of thing intended as substitute  – no liability, b)    of the substitute after substitution is made – with liability, (5). When the defect of the contract consists in the incapacity of one of the parties, the incapacitated person is not obliged to make any restitution except insofar as he has been benefited by the thing or price received by him. Under our civil law, the offer and acceptance concur only when the offeror comes to know, and not when the offeree merely manifests his acceptance, ELEMENTS OF VALID OFFER             ELEMENTS OF VALID ACCEPTANCE, a. definite                                                  a. unequivocal, b. complete                                               b. unconditional, a)    offer is made to a person present – acceptance must be made immediately, b)    offer is made to a person absent – acceptance may be made within such time that, under normal circumstances, an answer can be received from him, OPTION – option may be withdrawn anytime before acceptance is communicated but not when supported by a consideration other than purchase price: option money. Change ), You are commenting using your Google account. Business Law. The book includes an introduction to law to provide readers a background on obligations and contracts and other business law courses A study guide is provided at the end of every chapter or section and is designed to, among other things, primarily test and further increase the understanding of the provisions of law by … If you continue browsing the site, you agree to the use of cookies on this website. Obligations derived from quasi-contracts shall be subject to the provisions of Chapter 1, Title XVII, of this Book. DOES NOT INVALIDATE CONTRACT PER SEExceptions: 4 years from time defect of consent ceases, Contracts entered into by minors/incapacitated persons, CONTRACT DOES NOT CONSTITUTE CRIMINAL OFFENSE BUT IS ILLEGAL OR UNLAWFUL PER SE, Active subject ( obligee/creditor ) – the one in whose favor the obligation is constituted, Passive subject ( obligor/debtor ) – the one who has the duty of giving, doing or not doing, Object – prestation; the conduct which has to be observed by the debtor/obligor, Causa (causa debendi/causa obligationes) – why obligation exists, determinate or determinable – or else, void, Pertinent provisions of the RPC and other penal laws subject to Art 2177 Civil Code, Art 100, RPC – Every person criminally liable for a felony  is also civilly liable, Chapter 2, Preliminary title, on Human Relations ( Civil Code ), Title 18 of Book IV of the Civil Code – on damages, when acquittal is due to reasonable doubt – no civil liability, when acquittal is due to exempting circumstances – there is civil liability, when there is preponderance of evidence – there is civil liability, Obligation to give – obligation to deliver the thing agreed upon, Obligation to do/not to do – obligation to do/not to do the service agreed upon, standard of care: that of a good father of a family – unless the law or stipulation requires another standard of care, When does the right begin to exist : from the time to deliver arises, Accessories – those joined to or included with the principal for the latter’s better use, perfection or enjoyment, Accessions – additions to or improvements upon a thing, When does right to fruits arise? OF CREDIT SHALL RELEASE DEBTOR, Requisites: Effect of payment – extinguish obligation, Effect of Substantial performance in good faith. 1547) those found in certain contracts unless set aside or suppressed by the parties (i.e. Compensation Administration Class for February 23, 2013, Obligations and Contracts Class for February 23, 2013, Obligations and Contracts Class Assignment for this Saturday 2.9.2013, Finished Checking: CompenBen Mid Term Exams :), Compensation Administration for the Baccalaureate Course, Obligations and Contracts for the Baccalaureate Course, Can only be demanded if obligation is not very personal, Undo the things already done at debtor’s expense. E. Caliwan, J.D. Book IV Obligations and Contracts Note that you can also download your contract note from our back office portal. (1091a) Art. Corporate Governance Vs. Corporate Social Responsibilities, No public clipboards found for this slide. FAILURE TO COMPLY WITH PERFORMANCE/REMEDIES: Mora solvendi – default on the part of the debtor; 2 kinds: (1)  Mora Solvendi Ex re – default in real obligations, (2)  Mora Solvendi Ex persona – default in personal obligations, (1)  The obligation must be due, enforceable and already liquidated or determinate in amount, (3)  There must be a demand, unless demand is not required, (3)  When designation of time of delivery or rendering the service was a controlling motive, (4)  When demand would be useless as when debtor has rendered it beyond his powers to perform. UST Golden Notes in Obligations and Contract 2011. ( Log Out /  Law on obligations and contracts Guidance by Prof. Pio Sara Jagurin. extinguishment of principal carries accessory, except: if old obligation has condition, must be compatible with the new obligation; if new is w/o condition – deemed attached to new, substituting person of debtor ( passive ), conventional- agreement & consent of all parties; clearly established. The contract note you receive is the combined contract note i.e it includes the details of trades taken for NSE & BSE equity and NSE futures and options and Currency segments. Study Unit 4: The obligations of the lessor 14. 1160. 1305. OBLIGATIONS AND CONTRACTS TITLE 1 - OBLIGATION. Parties may freely enter into any stipulations, provided they are not contrary to law, morals, good customs, public order or public policy. 1183, NCC) Example- Pedro promise to pay Juan the sum of P1, 000.00 if Juan furnishes Pedro with information as to the whereabouts of Jane and another sum of P2,000.00 if Juan kidnaps Jane, in the obligation… Exception: No recovery can be had in cases where nullity of contract arose from illegality of contract where parties are in pari delicto; except: Fill in your details below or click an icon to log in: You are commenting using your WordPress.com account. NO examples or woder understandings for each article. Art. (n) Art. Click here to … You can change your ad preferences anytime. Obligations derived from quasi-contracts shall be subject to the provisions of Chapter 1, Title XVII, of this Book. COMPENSATION – Set off; it is a mode of extinguishment to the concurrent amount the obligation of persons who are in their own right reciprocally debtors or creditors, –          not all requisites are present, –          depositum; commodatum; criminal offense; claim for future support; taxes, Effect of assignment of credit to 3rd person; can there still be compensation, a. if made after compensation took place – no effect; compensation already perfected, b. if  made before compensation took place – depends, 7. 1156 - 1162. There is deliberate intention to cause damage. In obligations to render service, the value thereof shall be the basis for damages. Natural Elements (Art. cession of action of rights proceeding from an act appearing in a public inst. 1156. Essential Environment: The Science Behind the Stories Jay H. Withgott, Matthew Laposata. If there is performance in either part and there is acceptance of performance, it takes it out of unenforceable contracts; also estoppel sets in by accepting performance, the defect is waived, It produces no effect whatsoever either against or in favor of anyone, There is no action for annulment necessary as such is ipso jure. Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith. PAYMENT MADE TO AN INCAPACITATED PERSON , VALID IF: PAYMENT TO A 3RD PARTY NOT AUTHORIZED, VALID IF PROVED & ONLY TO THE EXTENT OF BENEFIT; PRESUMED IF: PAYMENT MADE IN GOOD FAITH TO A PERSON IN POSSESSION. 1. 21. Facultative – only one prestation has been agreed upon but another may be given in substitution. Set out the different obligations of the lessor 15. The obligation under the note us totally extinguished. •Consensual contracts- contracts perfected by mere … I recognize and acknowledge the contributors of the sources of these notes. … A short summary of this paper. Pio Sara Jagurin. Art. (b)  3rd person – if any of the ff. Looks like you’ve clipped this slide to already. (10)        With penal clause – an accessory undertaking to assume greater liability in case of breach; (a)  Payor – the one performing, he can be the debtor himself or his heirs or assigns or his agent, or anyone interested in the fulfillment of the obligation; can be anyone as long as it is with the creditor’s consent, (b)  3RD person pays/performs – only the creditor’s consent; If performance is done also with debtor’s consent – he takes the place of the debtor. TTh 17:00 - 18:30 PERSONS WHO CANNOT GIVE CONSENT TO A CONTRACT: Note: Dolus bonus (usual exaggerations in trade) are not in themselves fraudulent, Note: In the Sia Suan v Alcantara case, there is a strong dissent by J.Padilla to the effect that the minor cannot be estopped if he is too young to give consent; one that is too young to give consent is too young to be estopped. Active subject ( obligee/creditor ) – the one in whose favor the obligation is constituted 2. … Waiver for future negligence may be allowed in certain cases:a)     gross – can never be excused in advance; against public  policy, w/ fault or at expense of obligor/ usufructuary, a)    Various things are due but the giving principally of one is sufficient, a) Only one thing is due but a substitute may be given to render payment/fulfillment easy, b)    If one of prestations is illegal, others may be valid but obligation remains, b) If principal obligations is void and there is no necessity of giving the substitute;  nullity of P carries with it nullity of S, c) If it is impossible to give all except one, the last one must still be given, c)    If it is impossible to give the principal, the substitute does not have to be given; if it is impossible to give the substitute, the principal must still be given, d)  Right to choose may be given either to debtor or creditor, d) The right of choice is given only to the debtor, b. accessory – principal still outstanding, c. accessory oblig. 1159. Unauthorized/No sufficient authority – entered into in the name of another when: in excess of authority conferred ( ultra vires ), Both parties incapable of giving consent -2 minor or 2 insane persons, Agreement to be performed within a year after making contract, Special promise to answer for debt, default or miscarriage of another, Agreement made in consideration of promise to marry, Agreement for sale of goods, chattels or things in action at price not less than 500; exception: auction when recorded sale in sales book, Agreement for lease of property for more than 1 year & sale of real property regardless of price, Failure of defendant to object in time, to the presentation of parole evidence in court, the defect of unenforceability is cured, Acceptance of benefits under the contract. Art. SPECIAL RULES/FORMS OF PAYMENT – Special Forms: Requisites for the Application of payment: Exception: there may be application of payment even if all debts are not yet due if: b)    when application of payment is made by the party for whose benefit the term has been constituted, a)    Debtor without protest accepts receipt in which creditor specified expressly and unmistakably the obligation to which such payment was to be applied – debtor in this case renounced the right of choice, b)    When monthly statements were made by the bank specifying the application and the debtor signed said statements approving the status of her account as thus sent to her monthly by the bank, 1)    If creditor consents, for a sale presupposes the consent of both parties, 2)    If dacion will not prejudice the other creditors, 3)    If debtor is not judicially declared insolvent, c)    Complete or partial insolvency of debtor, d)    Abandonment of all debtor’s property not exempt from execution, e)    Acceptance or consent on the part of the creditors, a)    Creditors do not become the owner; they are merely assignees with authority to sell, b)    Debtor is released up to the amount of the net proceeds of the sale, unless there is a stipulation to the contrary, c)    Creditors will collect credits in the order of preference agreed upon, or in default of agreement, in the order ordinarily established by law, Tender -the act of offering the creditor what is due him together with a demand that the creditor accept the same (When creditor refuses w/o just cause to accept payment, he becomes in mora accepiendi & debtor is released from responsibility if he consigns the thing or sum due), Consignation – the act of depositing the thing due with the court or judicial authorities whenever the creditor cannot accept or refuses to accept payment; generally requires prior tender of payment, (2)  Consignation was made because of some legal cause – previous valid tender was unjustly refused or circumstances making previous tender exempt, (3)  Prior Notice of Consignation had been given to the person interested in performance of obligation (1st notice), (4)  actual deposit/Consignation with proper judicial authorities, (5)  subsequent  notice of Consignation (2nd notice), (1)  Debtor may ask judge to order cancellation of obligation, (3)  Before creditor accepts or before judge declares consignation has been properly made, obligation remains ( debtor bears risk of loss at the meantime, after acceptance by creditor or after judge declares that consignation has been properly made – risk of loss is shifted to creditor). ELEMENTS OF AN OBLIGATION: Active subject (obligee/creditor): one in whose favor the obligation is constituted concur: ii.    it falls under art 1241, par 1,2,3 – the benefit is total so, performance is total, (c)  anyone in possession of the credit – but will apply only if debt has not been previously garnished. Instances where law imposes solidary obligation: d.   no reimbursement if payment is made after prescription or became illegal. Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith. Download Full PDF Package. (1303a) Art. A contract means an agreement which is enforceable by law .An agreement consists of reciprocal between the two parties .In case of contract each party is legally bound by the promise made by him. A judicial declaration to that effect is merely a declaration, It cannot be confirmed, ratified or cured, If performed, restoration is in order, except if pari delicto will apply, The right to set up the defense of nullity cannot be waived, Anyone may invoke the nullity of the contract whenever its juridical effects are asserted against him, No action for restitution on either side.  The law will leave you where you are, Thing/price to be confiscated in favor of government, Innocent party is entitled to restitution, Guilty party is not entitled to restitution, Instrument of crime will be confiscated in favor of govt, If purpose has not yet been accomplished & If damage has not been caused to any 3, Where laws are issued to protect certain sectors: consumer protection, labor, usury law, If one party is incapacitated, courts may allow recovery of money, property delivered by incapacitated person in the interest of justice; pari delicto cannot apply because an incapacitated person does not know what he is entering into; unable to understand the consequences of his own action, If agreement is not illegal per se but merely prohibited & prohibition is designated for the protection of the plaintiff – may recover what he has paid or delivered by virtue of public policy, incapacitated  – not obliged to return what he gave but may recover what he has given. Consignation w/o prior tender – allowed in: 2.LOSS OF THE THING DUE – partial or total/ includes impossibility of performance, 1)    When the object perishes (physically), 3)    When it disappears in such a way that: its existence is unknown or it cannot be recovered, WHEN IS THERE IMPOSSIBILITY OF PERFORMANCE, (a)  Directly – caused as when prohibited by law, (b)  Indirectly – caused as when debtor is required to enter a military draft, b)    Debtor is made liable for fortuitous event because of a provision of law, contractual stipulation or the nature of the obligation requires assumption of risk on part of debtor, a)    if the generic thing is delimited, b)    if the generic thing has already been segregated, General Rule: Debtor is released when prestation becomes legally or physically impossible without fault on part of debtor, EFFECT OF PARTIAL LOSS – ( judicial determination of extent is necessary), a)    when loss is significant – may be enough to extinguish obligation, b)    when loss insignificant – not enough to extinguish obligation, WHEN THING IS LOST IN THE POSSESSION OF THE DEBTOR, Presumption: Loss due to debtor’s fault ( disputable ), Exception: natural calamity, earthquake, flood, storm, 3.   REBUS SIC STANTIBUS –  agreement is valid only if the same conditions prevailing at time of contracting continue to exist at the time of performance, EFFECT OF DIFFICULTY BEYOND PARTIES’ CONTEMPLATION, Rule: Obligor may be released in whole or in part, (b)  The performance is extremely difficult, but not impossible (because if it is impossible, it is extinguished by impossibility), (c)  The event was not due to the act of any of the parties, (d)  The contract is for a future prestation, 4. 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