Unforeseen difficulty extinguishes obligation
Another exception to the obligatory force of a contract is expressed in Article 1267 of the Civil Code, to wit:
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.
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 is therefore only in absolutely exceptional changes of circumstances that equity demands assistance for the debtor.
[1] Tagaytay Realty Co, Inc. v. Gacutan, G.R. No. 160033, July 01, 2015.
[2] PNCC v. CA, G.R. No. 1116896 May 5, 1997.