PROJECT JURISPRUDENCE

Under Bar Bulletin (BB) No. 30, S. 2021, otherwise known as the "Guide and Rules of Conduct to the 2020/21 Bar Examinations (Omnibus Guidelines),"  examinees who present a positive test result for COVID-19 before the first Bar Sunday will not be allowed to take the Bar Examinations , and will be marked "did not finish." They shall be advised to adhere to the local government unit's required health protocols for positive cases. Additionally, the BB No. 30 states that examinees who present a positive COVID-19 test result, whether symptomatic or asymptomatic, will automatically be denied entry to the local testing center. They will be required to undergo quarantine based on the guidelines and protocols of the local government unit of their local testing center. Examinees who obtain a positive COVID-19 test result must inform the Office of the Bar Chairperson immediately at barchair202021.sc@judiciary.gov.ph, stating their name and assigned local tes...

Regular holidays and special days (also called special holidays) are essential in a law student's study of Labor Standards because certain employee benefits are affected by certain days of the year. Regular holidays Jan. 1 (Saturday) - New Year's Day April 9 (Saturday) - Araw ng Kagitingan (Day of Valor) April 14 - Maundy Thursday April 15 - Good Friday May 1 (Sunday) - Labor Day June 12 (Sunday) - Independence Day Aug. 29 (Monday) - National Heroes' Day Nov. 30 (Wednesday) - Bonifacio Day Dec. 25 (Sunday) - Christmas Day Dec. 30 (Friday) - Rizal Day Separate proclamations for the observance of the Eid'l Fitr and the Eid'l Adha, both regular holidays, once the dates of these Islamic holidays have been determined through the Hijra or lunar calendar. Special non-working days Feb. 1 (Tuesday) - Chinese New Year Feb. 25 (Friday) - EDSA People Power Revolution Anniversary April 16 - Black Saturday Aug. 21 (Sunday) - Ninoy Aquino Day Nov. 1 (Tuesday...

According to a well-known expert in the field of civil law, when money in the bank is lost through fraud, it is not the banking public who should shoulder the loss; it is the bank. Atty. Elmer T. Rabuya is an author of civil law textbooks and law review lecturer. His books are available in fine bookstores nationwide. In one Facebook post, Rabuya explained the nature of bank deposits, citing Article 1980 of the Civil Code which says: "Art. 1980. Fixed, savings, and current deposits of money in banks and similar institutions shall be governed by the provisions concerning simple loan." His analysis is quoted below: Interpreting the foregoing provision, the Supreme Court explained that there is a debtor-creditor relationship between the bank and its depositor. The bank is the debtor and the depositor is the creditor. The depositor lends the bank money and the bank agrees to pay the depositor on demand. (Co...

In one of the Facebook posts of The Philippine Star, it was reported that an ex-girlfriend sued her ex-boyfriend for damages for wasting her time, following him breaking up with her after a 10-year relationship. Assuming that the the suit was filed in the Philippines and that Philippine laws apply, would the ex-girlfriend's complaint prosper? In other words, should the ex-boyfriend pay her damages for wasting her time -- again, assuming this allegation to be true -- after a 10-year relationship? The answer may be had from the meaning of "injury." In law, "injury" is defined as an act or omission in violation of the rights of another. It may also be an act or omission in breach of one's obligation to other persons. The most basic example of an injury is one suffered by one person by reason of the abuse of right of another person. Hence, for example, even if it is the right of a person to fence his land, s/he would still be liable for damages if, in doing so, ...

Article 1364 of the Civil Code provides: ART. 1364. When through the ignorance, lack of skill, negligence or bad faith on the part of the person drafting the instrument or of the clerk or typist , the instrument does not express the true intention of the parties, the courts may order that the instrument be reformed. Under the above article, neither party has fault or responsible for the mistake in the contract. Hence, either party may ask for the reformation of the contract.[1] Thus, in a case, the Supreme Court allowed the reformation of a letter written by the plaintiff (contractor) to the defendant, which affirmed a verbal contract between the plaintiff and the defendant relating to the construction of certain buildings, by substituting the dollar ($) sign for the peso (P) sign, it appearing that in said letter, by clerical error and unknown to the plaintiff, the latter sign was used instead of the former and the defendant knew or should have known in the very nature of ...

Reformation is remedy in equity by means of which a written instrument is made or construed so as to express or conform to the real intention of the parties when some error or mistake has been committed.[1] Articles 1362 and 1363 of the Civil Code of the Philippines provide: ART. 1362. If one party was mistaken and the other acted fraudulently or inequitably in such a way that the instrument does not show their true intention, the former may ask for the reformation of the instrument ART. 1363. When one party was mistaken and the other knew or believed that the instrument did not state their real agreement, but concealed that fact from the former , the instrument may be reformed. Under Article 1362, the right to ask for reformation is granted only to the party who was mistaken in good faith. Here, the mistake is not mutual.[2] If one party was mistaken and the other acted fraudulently, the injured party or the mistaken party can ask for the reformation of the contract. Moreover...

Reformation is remedy in equity by means of which a written instrument is made or construed so as to express or conform to the real intention of the parties when some error or mistake has been committed.[1] Article 1361 of the Civil Code of the Philippines provides: ART. 1361. When a mutual mistake of the parties causes the failure of the instrument to disclose their real agreement, said instrument may be reformed. To justify reformation under this article, the following requisites must concur: (1) The mistake must be of fact (Art. 1331.), for if it is one of law, the remedy is annulment (Art. 1334.);  (2) Such mistake must be proved by clear and convincing evidence;  (3) The mistake must be mutual, that is, common to both parties to the instrument; and  (4) The mistake must cause the failure of the instrument to express their true intention.[2][3] Moreover, in Vda. de Gonzales vs. Santos,[4] the Supreme Court held that relief by way of reformation of a writt...

Reformation is that remedy by means of which a written instrument is amended or rectified so as to express or conform to the real agreement or intention of the parties when by reason of mistake, fraud, inequitable conduct, or accident, the instrument fails to express such agreement or intention. 

Reformation is that remedy by means of which a written instrument is amended or rectified so as to express or conform to the real agreement or intention of the parties when by reason of mistake, fraud, inequitable conduct, or accident, the instrument fails to express such agreement or intention.[1] In Veluz v. Veluz,[2] the Supreme Court laid down the differences between reformation of instruments and annulment of contract, to wit: The reformation of instruments presupposes a valid, existing contract , in which there had been a meeting of the minds of the parties but the instrument drawn up and signed by them does not correctly express the terms of their agreement while annulment presupposes a defective contract in which the minds of the parties did not meet, or the consent of one was vitiated. Moreover, for the reformation of instruments, equity of reformation is ordinarily limited to written agreements, and its purpose is to establish a...

Article 1359 of the Civil Code of the Philippines provides:  ART. 1359. When, there having been a meeting of the minds of the parties to a contract, their true intention is not expressed in the instrument purporting to embody the agreement, by reason of mistake, fraud, inequitable conduct or accident, one of the parties may ask for the reformation of the instrument to the end that such true intention may be expressed. If mistake, fraud, inequitable conduct, or accident has prevented a meeting of the minds of the parties, the proper remedy is not reformation of the instrument but annulment of the contract. Reformation is that remedy by means of which a written instrument is amended or rectified so as to express or conform to the real agreement or intention of the parties when by reason of mistake, fraud, inequitable conduct, or accident, the instrument fails to express such agreement or intention.[1] For reformation to concur, the following requisites must be present: a) t...

Cause is the essential and impelling reason why a party assumes an obligation. The following are the classification of contracts according to cause: Onerous  or one the cause of which is the undertaking or the promise of the thing or service by the other party. Renumeratory  or one the cause of which is the service or benefit which is remunerated. Gratuitous  or one the cause of which is the mere liberality of the benefactor.

Article 1351 of the Civil Code provides: ART. 1351. The particular motives of the parties in entering into a contract are different from the cause thereof. (n) Motive is the purely personal or private reason which a party has in entering into a contract. It is different from the cause of the contract. Article 1351 embodies “a principle which is common to both Philippine law and American jurisprudence.”[1][2] The cause of the contract is the proximate reason of the parties to enter into a contract while motive is the remote reason of the parties in entering into a contract. The former is always the same for the contracting parties while the latter differs for each contracting party. Moreover, the illegality of the cause affects the existence or validity of the contract while the illegality of the motive does not affect the existence or validity of the contract. [1] Report of the Code Commission, p. 137. [2] De Leon. (2014). Obligations and Contracts.

Cause is the essential and impelling reason why a party assumes an obligation. Cause and object are different from each other. As to remuneration, cause is the service or benefit which is remunerated while object is the thing which is given remuneration.  As to donation, cause is the liberality of the donor or benefactor while object is the thing which is given or being donated.  As to the thing, cause is the prestation or promise of a thing or service by the other while object is the thing or service itself.  As to contracting parties, cause is different with respect to each part while object may be the same for both parties.

Article 1350 of Civil Code provides:  ART. 1350. In onerous contracts the cause is understood to be, for each contracting party, the prestation or promise of a thing or service by the other; in remuneratory ones, the service or benefit which is remunerated; and in contracts of pure beneficence, the mere liberality of the benefactor. (1274)  Cause (causa) is the essential or more proximate purpose or reason which the contracting parties have in view at the time of entering into the contract,[1] or, as expressed in another case, it is the “why of the contract, the essential reason which moves the contracting parties to enter into the contract.’’[2] It is the Civil Code term for consideration in Anglo-American or common law.[3] For cause to exist, the following requisites must concur: a) exists at the time the contract is entered into;[4] b) lawful;[5] and c) true or real.[6] [1] 8 Manresa 697; Republic vs. Cloribel, 36 SCRA 534 (1970).  [2] Gonzales vs. T...

The impossibility of the object of a contract may be: Physical , or when the thing or service in the very nature of things cannot exist (e.g., a dog that can fly) or be performed. Moreover, when we talk of services, the impossibility may be:     a) Absolute , or when the act cannot be done in any case so that nobody can perform it; or     b) Relative , or when it arises from the special circumstances of the case (e.g., to make payment to a dead person, to drive a car on flooded highways, etc.) or the special conditions or qualifications of the obligor (to paint a portrait by a blind person, etc.).[1][2] Legal , or when the thing or service is contrary to law, morals, good customs, public order, or public policy. [1] Articles 1266 and 1267, Civil Code. [2] De Leon. (2014). Obligations and Contracts.

Contract is the meeting of the minds between two persons whereby one bind himself with respect to the other, to give something or to render some services.[1] There is no contract unless  the following requisites concur: a) consent of the contracting parties; b) object certain which is the subject matter of the contract; and c) cause of the obligation which is established.[2] The object of the contract is its subject matter .[3] It is the thing, right or service which is the subject matter of the obligation arising from the contract.[4] The object of the contract can be all things or services, which includes future things.[5] In order that a thing, right, or service may be the object of a contract, it should be in existence at the moment of the celebration of the contract, or at least, it can exist subsequently or in the future. For a thing to be the object of the contract it must be: a) within the commerce of men[6]; b) not legally or physically impossible[7]; c) in existence...

Articles 1345 and 1346 of the Civil Code provide: ART. 1345. Simulation of a contract may be absolute or relative. The former takes place when the parties do not intend to be bound at all; the latter, when the parties conceal their true agreement. (n)  ART. 1346. An absolutely simulated or fictitious contract is void. A relative simulation, when it does not prejudice a third person and is not intended for any purpose contrary to law, morals, good customs, public order or public policy binds the parties to their real agreement. (n) Simulation is the declaration of a fictitious will, deliberately made by agreement of the parties, in order to produce, for the purposes of deception, the appearances of a judicial act which does not exist or is different with that which was really executed.[1] There exists an instrument, but there is no contract. In Tongoy v. CA,[2] the Supreme Court held that simulation of a contract is the act of deliberately deceiving others, by feigning or pr...

Article 1338 of the Civil Code of the Philippines provides: ART. 1338. There is fraud when, through insidious words or machinations of one of the contracting parties, the other is induced to enter into a contract which, without them, he would not have agreed to. (1269) There is fraud if the following elements are present: a) it is made in bad faith; b) one party employed fraud or insidious words or machinations; c) due to fraud, the other party is induced to enter into a contract; d) the other party suffered damage or injury; e) it must be serious; and f) it must have been employed by one contracting party upon the other and not employed by both contracting parties nor by third persons. In Article 1339, failure to disclose facts, when there is a duty to reveal them, as when the parties are bound by confidential relations, constitutes fraud. A neglect or failure to communicate that which a party to a contract knows and ought to communicate constitutes concealment. In thi...

The concept of undue influence that vitiates a contract is discussed in Article 1337 of the Civil Code, to wit: ART. 1337. There is undue influence when a person takes improper advantage of his power over the will of another , depriving the latter of a reasonable freedom of choice. The following circumstances shall be considered: the confidential, family, spiritual and other relations between the parties, or the fact that the person alleged to have been unduly influenced was suffering from mental weakness, or was ignorant or in financial distress. (n) [Emphasis supplied] For undue influence to vitiate the contract, the following requisites must occur: a) there is an improper advantage; b) power over the will of another; and c) deprivation of the latter’s will of a reasonable freedom of choice. In Coso v. Fernandez,[1] the Supreme Court held that the rule as to what constitutes undue influence has been variously stated but the substance of the different statements is that, to b...

The first paragraph in Article 1335 of the Civil Code provides: ART. 1335. There is violence when in order to wrest consent, serious or irresistible force is employed. Violence requires the employment of physical force . Under Article 1335, to make consent defective, the force employed must be either serious or irresistible. In either case, consent is not free.[1] It is essential that the force employed must be the determining cause or reason for giving consent.[2] Violence is determined by the intention and the means employed. Physical force employed must be irresistible, or of such degree that victim has no other recourse under the circumstances but to submit. Such force is the determining cause in giving of consent. Moreover in Article 1336, violence or intimidation shall annul the obligation, although it may have been employed by a third person who did not take part in the contract. [1] Report of the Code Commission, p. 136. [2] De Leon. (2014). Obligations and Contra...

Paragraph 2 of Article 1335 of the Civil Code provides: There is intimidation when one of the contracting parties is compelled by a reasonable and well-grounded fear of an imminent and grave evil upon his person or property, or upon the person or property of his spouse, descendants or ascendants, to give his consent. Consent is vitiated when intimidation is present. For intimidation to vitiate the consent of a party to a contract, the following requisites must be present: a) one party is compelled to give his consent by a reasonable and well-grounded fear of an evil; b) the evil must be imminent and grave; c) the evil must be upon his person or property, spouse, descendants or ascendants; and d) the evil must be unjust.  To determine the degree of intimidation, the age, sex and condition of the person shall be borne in mind.[1] If a contract is signed merely out of reverential fear or the fear of displeasing a person to whom respect and obedience are due, the contract i...

Article 1330 of the Civil Code provides: ART. 1330. A contract where consent is given through mistake, violence, intimidation, undue influence, or fraud is voidable. (1265a) Mistake is "a misunderstanding of the meaning or implication of something ” or a “wrong action or statement proceeding from a faulty judgment ."[1] In order that mistake may invalidate consent, it should refer to the substance of the thing which is the object of the contract, or to those conditions which have principally moved one or both parties to enter into the contract.[2] There is no mistake if the party alleging it knew the doubt, contingency or risk affecting the object of the contract.[3] For a contract to be voidable due to mistake, the following requisites must concur: a. The error must be substantial regarding:  1. The object of the contract (error in re) which may be:  Mistake as to the identity of the thing (error in corpore); Mistake as to the substance of the thing (error in substa...

Article 1324 of the Civil Code discusses the contract of option, to wit:  ART. 1324. When the offerer has allowed the offeree a certain period to accept, the offer may be withdrawn at any time before acceptance by communicating such withdrawal, except when the option is founded upon a consideration, as something paid or promised. (n) width="0%" Option contract is a preparatory contract giving a person for a consideration a certain period and under specified conditions within which to accept the offer of the offerer.[1] It is a separate agreement distinct from the contract which the parties may enter into upon the consummation of the option.[2]  Moreover, if the option contract is with consideration, the offeror cannot unilaterally withdraw his offer. If it is without consideration, the offeror may withdraw by communicating withdrawal to the offeree before acceptance.  The pertinent provision provides the general rule regarding offer and acceptance: when the offerer ...

A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service.[1] The following are disqualified to enter into a contract: a. Those who are under civil interdiction for transactions inter vivos[2]; b. Undischarged insolvents[3]; c. Husband and wife cannot donate to each other [4], nor sell to each other if the marriage is under the regime of Absolute Community of Property [5]; and d. The following persons cannot acquire by purchase, even at a public or judicial auction, either in person or through the mediation of another:[6]  (1) The guardian, the property of the person or persons who may be under his guardianship;  (2) Agents, the property whose administration or sale may have been entrusted to them, unless the consent of the principal has been given;  (3) Executors and administrators, the property of the estate under administration;  (4) Public officers and empl...

Paragraph 2 of Article 1319 of the Civil Code discusses the theory of cognition: Acceptance made by letter or telegram does not bind the offerer except from the time it came to his knowledge. The contract, in such a case, is presumed to have been entered into in the place where the offer was made. (1262a) With regard to contracts between absent persons, the acceptance may be transmitted by any means which the offerer has authorized the offeree to use.[1] The above provision is the theory of cognition or information . An example of constructive knowledge is where the letter or telegram containing the acceptance is received by the offerer who for some reason did not read it but not where he could not have read it as when he was absent or physically incapacitated at the time of the receipt of the same. The presumption, however, is that the offerer read the contents thereof or came to know of the acceptance.[2] Furthermore, an offer can be revoked. In Laudicio v. Arias[3], the ...

A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service.[1] A contract is perfected by mere consent. From the moment of a meeting of the offer and the acceptance upon the object and the cause that would constitute the contract, consent arises. However, “the offer must be certain” and “the acceptance seasonable and absolute; if qualified, the acceptance would merely constitute a counteroffer.[2] An offer is a unilateral proposition which one party makes to the other for the celebration of the contract.[3] Offer is a proposal made by one party (offerer) to another to enter into a contract. It is more than an expression of desire or hope. It is really a promise to act or to refrain from acting on condition that the terms thereof are accepted by the person (offeree) to whom it is made.[4]  An offer is terminated if: a. there is a rejection by the oferee; b. incapacity of...

A contract is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render some service.[1] The following are the classifications of a contract: As to subject matter.  a. Things; or b. Services. As to formation. a. Real - delivery, actual or constructive, is required in addition to consent; b. Consensual - consent is sufficient to enter into a contract; or c. Formal - there are special formalities required to enter into a contract, e.g. marriage. As to relation to other contracts. a. Principal - can exist alone; b. Accessory - depends on other contract for existence; or c. Preparatory - preliminary step towards the celebration of a subsequent contract. As to form. a. Formal - there are special formalities required to enter into a contract, e.g. marriage; or b. Informal - may be entered into in whatever form as long as there is consent, object and cause. As to cause. a. Onerous - there is an exchang...

Novation is a juridical act of dual function—it extinguishes an obligation, and at the same time, it creates a new one in lieu of the old. It operates as a relative, not an absolute, extinction.  There are different kinds of novation.  As to origin. 1. Legal - takes place by operation of law; or 2. Conventional - takes place by agreement of parties. As to form.  1. Express - when it is declared in unequivocal terms; or 2. Implied - when the old and new obligations are on every point incompatible with each other. In California Bus Line v. State Investment,[1] the Supreme Court held that in the absence of an unequivocal declaration of extinguishment of the pre-existing obligation, only proof of incompatibility between the old and new obligation would warrant a novation by implication. Moreover, the test of incompatibility decides whether or not the two obligations can stand together, each one having its independent existence. If they cannot, they are incompat...

The effect of assignment of rights by the creditor to a third person is discussed in Article 1285 of the Civil Code of the Philippines, to wit: ART. 1285. The debtor who has consented to the assignment of rights made by a creditor in favor of a third person, cannot set up against the assignee the compensation which would pertain to him against the assignor, unless the assignor was notified by the debtor at the time he gave his consent, that he reserved his right to the compensation. If the creditor communicated the cession to him but the debtor did not consent thereto, the latter may set up the compensation of debts previous to the cession, but not of subsequent ones. If the assignment is made without the knowledge of the debtor, he may set up the compensation of all credits prior to the same and also later ones until he had knowledge of the assignment. (1198a) The above provision addresses cases of compensation which takes place after an assignment of rights made by the creditor...

Article 1280 of the Civil Code of the Philippines provides: ART. 1280. Notwithstanding the provisions of the preceding article, the guarantor may set up compensation as regards what the creditor may owe the principal debtor . (1197) The extinguishment of the principal obligation due to compensation carries with it the accessory obligation. A guarantor's obligation is an accessory one. Therefore, the guarantor is given the right to set up compensation as regards what the creditor may owe the principal debtor. (De Leon, 2014).

Compensation takes place when two persons, in their own right, are creditors and debtors of each other. However, there are obligations which cannot be compensated. These obligations are expressed in Articles 1287 and 1288 of the Civil Code, to wit: ART. 1287. Compensation shall not be proper when one of the debts arises from a depositum or from the obligations of a depositary or of a bailee in commodatum. Neither can compensation be set up against a creditor who has a claim for support due by gratuitous title, without prejudice to the provisions of paragraph 2 of Article 301. (1200a) ART. 1288. Neither shall there be compensation if one of the debts consists in civil liability arising from a penal offense. (n) The contract of depositum and commodatum cannot be compensated. Future support due by gratuitous title cannot also be compensated as stated in paragraph 2 of  Art. 1287. Furthermore, civil liability arising from a penal clause cannot be compensated. In Metropolitan v....

The following are kinds of compensation: 1. As to extent : a. Total - when both obligations are of the same amount and are entirely extinguished[1]; or b. Partial - when the two obligations are of different amounts and a balance remains.[2] 2. As to cause : a. Legal - takes place by operation of law from the moment all requisites are present even without the knowledge of both parties[3][4]; b. Voluntary - takes place when parties who are mutually creditors and debtors of each other agree to compensate their respective obligations even though one of the requisites of compensation may be lacking[5]; c. Judicial - by judicial decree[6]; and d. Facultative - can only be set up at the option of a creditor, when legal compensation cannot take place because some legal requisites in favor of the creditor are lacking. [1] Article 1281, Civil Code. [2] Id. [3] Article 1279, Civil Code. [4] Article 1290, Civil Code. [5] Article 1282, Civil Code. [6] Article 1283, Civil Code.

Article 1277 of the Civil Code of the Philippines provides: ART. 1277. Confusion does not extinguish a joint obligation except as regards the share corresponding to the creditor or debtor in whom the two characters concur. (1194) In a join obligation, there are as many debts as there are debtors and credits as there are creditors. It is considered that these debts and credits are distinct and separate.[1][2] When confusion takes place in a joint obligation, the obligation is only extinguished in so far as the share in the debt and credit of the corresponding debtor and creditor in whom the two characters merged. As to the obligation of other joint debtors and creditors, it will remain the same. However, when confusion takes place in solidary obligation, the obligation is extinguished but the other debtors may be liable for reimbursement if payment was made prior to remission.[3][4] [1] Article 1208, Civil Code. [2] De Leon. (2014). Obligations and Contracts. [3] Article 1215, Civil C...

For a confusion to take place it must be between the principal debtor and creditor and the same obligation must be involved. The obligation is extinguished from the time the characters of debtor and creditor are merged in the same person.[1] Article 1276 of the Civil Code discusses the effect of merger upon guarantors, to wit: ART. 1276. Merger which takes place in the person of the principal debtor or creditor benefits the guarantors. Confusion which takes place in the person of any of the latter does not extinguish the obligation. (1193)  If a merger takes place between the principal debtor or creditor , the principal obligation is extinguished. Thus, it will benefit the guarantor because the obligation of the guarantor is merely an accessory obligation. Since the guarantor's obligation is an accessory one, the extinguishment of principal obligation also results to extinguishment of the accessory obligation. However, when confusion takes place between the principal creditor an...

Article 1275 of the Civil Code of the Philippines discusses the concept of compensation, to wit: ART. 1275. The obligation is extinguished from the time the characters of creditor and debtor are merged in the same person. (1192a) Confusion or merger is the meeting in one person of the qualities of creditor and debtor with respect to the same obligation.[1][2] It takes place between the principal debtor and creditor  and the very same obligation must be involved. In  Valmonte v. CA,[3] the Supreme Court held that the confusion must be total, i.e. as regards the whole obligation. When confusion takes place, the obligation is extinguished. The reason behind this is because it is absurd that a person should enforce an obligation against himself.[4] For example, A executed a promissory note payable to B. B payed his debt to C using the promissory note executed by A. Turns out C is has an obligation to pay A. C then payed A the promissory note executed by the latter to B. Here the...

Article 1270 of the Civil Code states that express remission is subject to the formalities as donations, to wit: ART. 1270. Condonation or remission is essentially gratuitous, and requires the acceptance by the obligor. It may be made expressly or impliedly. One and the other kind shall be subject to the rules which govern inofficious donations. Express condonation shall, furthermore, comply with the forms of donation . (1187) The express condonation of a movable or personal property may be made either orally or in writing. Under Article 748 of the Civil Code, if the value of of the personal property donated exceeds five thousand pesos, the donation and the acceptance shall be made in writing. Otherwise, the donation shall be void. Moreover, in the express condonation of an immovable property, in order for the donation to be valid, it must be made in a public document, specifying therein the property donated and the value of the charges which the donee must satisfy. The ac...

Remission is an act of liberality, by virtue of which, without receiving any equivalent, the creditor renounces the enforcement of the obligation. The obligation is extinguished either in whole or in such part of the same to which remission refers.[1]When the debt refers to movable or personal property, Art. 748 will govern; if it refers to immovable or real property, Art. 749 applies. The kinds of remission are: As to form: Express condonation. When it is made verbally or in writing. It is formally: in accordance with forms of ordinary donations.[2] In order to be effective, an express remission must be accepted. Furthermore, when the debt refers to movable or personal property, Art. 748 will govern; if it refers to immovable or real property, Art. 749 applies. Implied condonation. It can be inferred from the acts or conduct of the parties. As to manner or date of effectivity: Inter vivos. Effective during the lifetime of the creditor. Mortis causa. Effective upon the death of the...

Condonation or remission of debt as a mode of extinguishment of obligation is discussed under Article 1270 of the Civil Code of the Philippines, to wit: ART. 1270. Condonation or remission is essentially gratuitous, and requires the acceptance by the obligor. It may be made expressly or impliedly. One and the other kind shall be subject to the rules which govern inofficious donations. Express condonation shall, furthermore, comply with the forms of donation. (1187) Condonation or remission is an act of liberality where the creditor gives up his right against the debtor , either in whole or in part, resulting in the extinguishment of the latter's obligation.[1][2] It is essentially gratuitous and requires the acceptance of the debtor. The reason for the need of debtor's consent is that one cannot simply impose his own generosity upon another person. The remission may be made expressly or impliedly. For a condonation or remission to be valid, the following requisites must concu...

Another exception to the obligatory force of  a contract is expressed in Article 1267 of the Civil Code, to wit: ART. 1267. When the service has become so difficult as to be manifestly beyond the contemplation of the parties, the obligor may also be released therefrom, in whole or in part. (n) The obligor may be released from his obligation even if the prestation is still possible, if the prestation is  extremely difficult and the event or change in circumstances could not have been foreseen by parties at the time of the execution of the contract. Note that the event must not be due to the act of any of the parties. Moreover, in Tagaytay v. Gacutan,[1] the Supreme Court held that the contract applicable in Article 1267 is for a future prestation. Furthermore, Article 1267 enunciates the " doctrine of unforeseen events ." In PNCC v. CA,[2] the Supreme Court explained that the parties to the contract must be presumed to have assumed the risks of unfavorable developments. It ...

Article 1266 of the Civil Code of the Philippines discusses the exception to the obligatory force of contract referred to in Article 1159, to wit: ART. 1266. The debtor in obligations to do shall also be released when the prestation becomes legally or physically impossible without the fault of the obligor. (1184a) This provision is applicable only to obligations "to do", and not to obligations "to give."[1] The impossibility of performance must take place after the constitution of the obligation or during the performance of the obligation.[2][3]  The impossibility referred in this article is either a physical or legal impossibility . Physical impossibility is present when the act by reason of its nature cannot be accomplished. For example, X obliged himself to dance in Y's birthday. However, a month before Y's birthday, X was murdered. X being dead cannot physically perform his obligation. Thus, the obligation is extinguished. On the other hand, legal impos...

Article 1264 of the Civil Code provides: ART. 1264. The courts shall determine whether, under the circumstances, the partial loss of the object of the obligation is so important as to extinguish the obligation. (n) The courts will determine if the partial loss of the thing due is so important that it would constitute the extinguishment of an obligation . Partial loss is present when only a portion of the thing  is loss or destroyed or when it suffers depreciation or deterioration.[1] For example, X obliged himself to dance for Y in his birthday. A day before Y's birthday, X was injured making it hard for him to dance. Here, the partial loss is equivalent to a complete or total loss. It is so important as to extinguishing the obligation. [1] De Leon. (2014). Obligations and Contracts.

The loss of a generic thing is governed by Article 1263 of the Civil Code, thus: ART. 1263. In an obligation to deliver a generic thing, the loss or destruction of anything of the same kind does not extinguish the obligation. (n) The loss of a generic thing even without debtor's fault and before he has incurred delay will not extinguish the obligation .[1] It is based on the principle that a generic thing never perishes. (Genus nunquam perit)[2][3] For example, the failure of the debtor to make payment even by reason of fortuitous event will not extinguish the obligation. This is because the obligation to pay money is a generic thing. Thus, it is not excused by fortuitous loss. [1] Rabuya. (2019). Obligations and Contracts. [2] De Leon. (2014). Obligations and Contracts. [3] Yu Tek & Co. vs. Gonzales, 29 Phil. 384 (1915) [4] Supra note 1.

The loss of a determinate thing is governed by Article 1262 of the Civil Code, to wit: ART. 1262. An obligation which consists in the delivery of a determinate thing shall be extinguished if it should be lost or destroyed without the fault of the debtor, and before he has incurred in delay. When by law or stipulation, the obligor is liable even for fortuitous events, the loss of the thing does not extinguish the obligation, and he shall be responsible for damages. The same rule applies when the nature of the obligation requires the assumption of risk. (1182a)  A thing is considered loss if it perishes, goes out of commerce or disappears in such a way that its existence is unknown or it cannot be recovered.[1][2] The general rule is that the loss of a determinate thing extinguishes the obligation. In oobrder for the obligation to be extinguished, the following requisites must be present: a) obligation to deliver a determinate thing; b) the thing is lost or destroyed without d...

Consignation is a special kind of payment where the debtor deposit the object of the obligation to a competent court in accordance with law whenever the creditor unjustly refuses to accept payment or because there are some circumstances present where direct payment to the creditor becomes impossible or inadvisable. Article 1260 discusses the concept of debtor's withdrawal, to wit: ART. 1260. Once the consignation has been duly made, the debtor may ask the judge to order the cancellation of the obligation.  Before the creditor has accepted the consignation, or before a judicial declaration that the consignation has been properly made, the debtor may withdraw the thing or the sum deposited, allowing the obligation to remain in force. (1180) The obligation remains in force before the approval of the court or acceptance of the creditor. Under Article 1260, as a matter of right, the debtor may withdraw the thing or amount consigned before the creditor has accepted the consignation or b...

Article 1257 of the Civil Code provides: ART. 1257. In order that the consignation of the thing due may release the obligor, it must first be announced to the persons interested in the fulfillment of the obligation . The consignation shall be ineffectual if it is not made strictly in consonance with the provisions which regulate payment. (1177) In order that the consignation of the thing due may release the obligor, it must first be announced to the persons interested in the fulfilment of the obligation. The consignation shall be ineffectual if it is not made strictly in consonance with the provisions which regulate payment. In Soco v. Militante,[1] the Supreme Court held that previous notice of consignation was given to those persons interested in the performance of the obligation. Previous notice is essential to the validity of the consignation and its lack invalidates the same. The purpose of notice is to give some time to the creditor for him to think of his unjustified ref...

Article 1256 of the Civil Code discusses the concept of tender of payment and consignation, to wit: ART. 1256. If the creditor to whom tender of payment has been made refuses without just cause to accept it, the debtor shall be released from responsibility by the consignation of the thing or sum due. Consignation alone shall produce the same effect in the following cases:  (1) When the creditor is absent or unknown, or does not appear at the place of payment; (2) When he is incapacitated to receive the payment at the time it is due; (3) When, without just cause, he refuses to give a receipt; (4) When two or more persons claim the same right to collect; (5) When the title of the obligation has been lost. (1176a) In Far East Bank v. Diaz Realty,[1] the Supreme Court held that tender of payment is a definitive act of offering the creditor what is due him or her, together with the demand that the creditor accept the same. More important, there must be a fusion of intent, ability ...

Article 1255 of the Civil Code governs the concept of payment by cession, to wit: ART. 1255. The debtor may cede or assign his property to his creditors in payment of his debts. This cession, unless there is stipulation to the contrary, shall only release the debtor from responsibility for the net proceeds of the thing assigned. The agreements which, on the effect of the cession, are made between the debtor and his creditors shall be governed by special laws. (1175a) Payment by cession is another special form of payment. It is the assignment or abandonment of all the properties of the debtor for the benefit of his creditors in order that the latter may sell the same and apply the proceeds thereof to the satisfaction of their credits.[1]  For a payment by cession to be fulfilled, the following requisites must concur: a) there is plurality of debts; b) there must be two or more creditors; c) partial or relative insolvency of the debtor; d) the assignment must involve al...

One of the special forms of payment under the Civil Code is dation in payment (dacion en pago). Article 1245 of the Civil Code provides: ART. 1245. Dation in payment, whereby property is alienated to the creditor in satisfaction of a debt in money, shall be governed by the law of sales. (n) In this kind of payment, the debtor delivers and transmits to the creditor the former's ownership over a thing as an accepted equivalent of the payment or performance of an outstanding debt.[1] The requisites for this payment are: (a) existence of a money obligation; (b) alienation to the creditor of debtor's property with the former's consent; and (c) satisfaction of the money obligation. [1] Tan Shuy v. Maulawin, 665 SCRA 604 (2012), citing Lopez v. CA, 200 Phil. 150 (2006).

Article 1252 of the Civil Code provides: ART. 1252. He who has various debts of the same kind in favor of one and the same creditor, may declare at the time of making the payment, to which of them the same must be applied. Unless the parties so stipulate, or when the application of payment is made by the party for whose benefit the term has been constituted, application shall not be made as to debts which are not yet due. If the debtor accepts from the creditor a receipt in which an application of the payment is made, the former cannot complain of the same, unless there is a cause for invalidating the contract. (1172a) The Civil Code provides four special forms of payment: (a) dation in payment[1]; (b) payment by cession[2]; (c) application of payments[3]; and (d) tender of payment and consignation.[4][5] The first paragraph of Article 1252 discusses the concept of application of payment. There is application of payment if: (a) there is plurality of debts; (b) debts are of the s...