law 101-obligations and contracts course outline [mrst]

UniversityofthePhilippinesCollegeofLaw

Law101:ObligationsandContracts

CourseOutline♦Prof.MaryRoseS.Tan

Semester2,AY20112012ContactInformation: maryrose.tan@gmail.com +639178871555CourseSchedule: MondaysandFridays,6:30p.m.to9:00p.m.

Room200(PadillaRoom)AttendanceRequirement: CollegeofLawrulesonattendanceshallbestrictlyapplied.

Studentsmayonlybeabsentforanycauseforamaximumof8sessions.

Assessment: (1)Classparticipation 30% (2)Midtermexamination 20% (3)FinalExam 50%PrescribedTextbook: Tolentino,CivilCodeofthePhilippines,Vol.IVINTRODUCTION

A. CourseOverviewB. CommonLawTraditionandtheCivilLawTradition

Agabin,P.A.,Mestizo:TheStoryofthePhilippineLegalSystem(2011),Chapter7,pp.169216

PARTONE:OBLIGATIONS

A. GeneralProvisions

1. Definition(Article1156,CivilCode)

2. Elementsa. ActiveSubjectb. PassiveSubjectc. ObjectorPrestationd. EfficientCauseorJuridicalTie

♦BasedontheCourseOutlineofProf.EduardoLabitag.

Law101:ObligationsandContractsProf.MaryRoseS.TanSemester2,AY20112012

3. NaturalObligations

a. Definition(Art.1423,CC)b. Examples(Articles1424to1430)c. DifferencebetweenNaturalandCivilObligation(Art.1423)d. Distinguishedfrommoralobligations

Villaroelv.Estrada,71Phil.140(1940)Fisherv.Robb,69Phil101(1939)

e. ConversiontoCivilObligation• bynovation• byratification

4. SourcesofObligations(Art.1157)

a. Law(Art.1158)b. Contracts(Art.1159,1305)c. Quasi‐contracts(Art.1160,2142)

• Kinds:i. Negotiorumgestio(Art.2144)ii. Solutioindebiti(Art.2154)iii. Others(Art.2164to2175)

d. DelictsorCrime(Art.1161)e. Quasi‐delicts(Art.1162,2176)

• Distinctionbetweencrimesandquasi‐delicts• Vicariousliability(Art.2180,Art.218‐219,FamilyCode)• Civilliabilityarisingfromcrime(Art.1161;Rule111,RevisedRulesof

CriminalProcedure)

Barredov.Garcia,73Phil607(1942)Mendozav.Arrieta,91SCRA113(1975)

5. ClassificationofObligations

a. PureandConditionalObligations(Art.1179‐1192)b. WithaPeriodoraTerm(Art.1193‐1198)c. AlternativeandFacultative(Art.1199‐1206)d. JointandSolidary(Art.1207‐1222)e. DivisibleandIndivisible(Art.1223‐1225)f. WithaPenalClause(Art.1226‐1230)

B. NatureandEffectsofObligations

1. KindsofPrestation

a. Togive

i. specificthing

• topreservethething(Art.1163)• todelivertheaccessionsandaccessories(Art1166)• todeliverthefruits(Art.1164,par.1)• todeliverthethingitself(Art.1244)

ii. genericthing(Art.1246)

b. Todo(Art.1244)c. Nottodo(Art.1244)

2. BreachofObligation

a. Concept

SongFov.HawaiianPhilippines,47Phil.821(1928)Velardeetal.v.CourtofAppeals,361SCRA56(2001)Angelesv.Calasanz,135SCRA323(1985)DeltaMotorCorporationv.Genuino,170SCRA29(1989)VermenRealtyv.CourtofAppeals,224SCRA549(1993)

b. ModesofBreach

• Delayormora(Art.1169)i. morasolvendi

CetusDevelopmentv.CourtofAppeals,176SCRA72(1989)AerospaceChemicalIndustriesv.CourtofAppeals,315SCRA92(1999)SantosVenturaHocormaFoundationv.Santos,441SCRA472(2004)Vazquezv.AyalaCorporation,443SCRA231(2004)Abellav.Francisco,55SCRA447(1931)delaCruzv.Legaspi,98SCRA43(1955)

ii. moraaccipiendi(Seealso1268)Villaroelv.ManilaMotorCo.,Inc.,104Phil.926(1958)

iii. compensationmoraeCentralBankv.CourtofAppeals,139SCRA46(1985)

• Fraudordolo(Art.1171)doloincidenteanddolocausante

Woodhousev.Halili,93Phil.526(1953)Geraldezv.CourtofAppeals(1994)

• Negligence(Art.1172,1173)

culpav.doloculpaaquilianov.culpacontractualstandardofcarerequired

Gutierrezv.Gutierrez,56Phil.177(1932)Vasquezv.Borja,74Phil.560(1944)deGuiav.ManilaElectricCorporation,40Phil706(1920)USv.Barias,23Phil434(1912)Sarmientov.SpousesCabrido,401SCRA122(2003)Crisostomov.CourtofAppeals,409SCRA528(2003)

• Contraventionofthetenor(Art.1172)Chavezv.Gonzales,32SCRA547(1970)Telefastv.Castro,158SCRA445(1988)Arrietav.NARIC,10SCRA79(1964)Magatv.Medialdea,206Phil341(1983)

c. Remediesincaseofbreachi. Performance

• Specificperformance(Art.1165;Section10,Rule39,RulesofCourt)• Substitutedperformance

‐ inanobligationtogivegenericthing(Art.1165,par.2)‐ undoingofpoorworkinanobligationtodo(Art.1167)

Chavezv.Gonzales,supraTanguiligv.CourtofAppeals,266SCRA78(1997)

‐ undoinginanobligationnottodo(Art1168)

ii. Rescission(Art.1191‐1192)iii. Damages(Art.1170)

d. SubsidiaryRemediesofCreditor

i. AccionSubrogatoria(Art.1177)ii. AccionPauliana(Art.1177;1381,par.3)KheHongChengv.CourtofAppeals,355SCRA701(2001)Siguanv.Lim,318SCRA725(1999)iii. OtherSpecificRemedies(Art.1652,1729,1608,1893)

e. FortuitousEvent(Art.1174)

i. Effect:ExtinguishmentofLiabilityii. ExceptionstoExtinguishment(Art.1174,1165par.3,552,1942,

1979,2001,2147)JuanNakpil&Sonsv.CourtofAppeals,144SCRA597(1986)Republicv.LuzonStevedoringCo.,21SCRA279(1967)Dioquinov.Laureano,33SCRA65(1970)Austriav.CourtofAppeals,39SCRA527(1971)NationalPowerCorporationv.CourtofAppeals,161SCRA334(1988)Yobidov.CourtofAppeals,281SCRA1(1997)BacolodMurciaMillingv.CourtofAppeals,182SCRA24Philcomsatv.GlobeTelecom,430SCRA(2004)

f. UsuriousTransactions(Art.1175,1413,1961)PD858;PD1685CentralBankCircular416MonetaryBoardCircularNo.905;No.2209EasternShippingLinesv.CourtofAppeals,234SCRA781(1994)CrisminaGarmentsv.CourtofAppeals,304SCRA356(1999)KengHuaProductsv.CourtofAppeals,286SCRA257(1998)SecurityBankv.RegionalTrialCourtMakati,263SCRA453(1996)Almedav.CourtofAppeals,256SCRA292(1996)AngelWarehousingv.Chelsea,23SCRA19(1968)FirstMetroInvestmentv.EstedelSol,369SCRA(2001)

C. DifferentKindsofObligations

1. PureandConditionalObligations

• PureObligations(Art.1179,par.1)• ConditionalObligations(Art.1181)

‐ Concept‐ Conditionv.PeriodorTerm

Gaitev.Fonacier,2SCRA830(1961) Gonzalesv.HeirsofTomasandPaulaCruz,314SCRA585(1999)

• KindsofConditions

a. Astotheeffectontheobligation(Art1181) Gonzalesv.HeirsofTomasandPaulaCruz,supra.

i. SuspensiveConditionorConditionprecedent

• Retroactiveeffectwhenconditionisfulfilled(Art.1187) Coronelv.CourtofAppealsandAlcaraz,263SCRA15(1996)

• Rightsofthecreditoranddebtorbeforefulfillmentofthecondition(Art.1188)

ii. ResolutoryConditionorConditionsubsequent Parksv.ProvinceofTarlac,49Phil.142(1927) CentralPhilippineUniversityv.CourtofAppeals,245SCRA511(1995) Quijadav.CourtofAppeals,299SCRA695(1998)

b. Astothecauseororigin(Art1182)

i. Potestative

• Effectoffulfillmentofconditiondependssolelyonthewillofthe

debtor• Debtor’spromisetopaywhenhecanisnotacondition(Art1180)

LaoLimv.CourtofAppeals,191SCRA150(1990)

ii. Causal NagaTelephoneCo.v.CourtofAppeals,230SCRA351(1994)

iii. Mixed Osmenav.Rama,14Phil.99(1909) Hermosav.Longora,93Phil.971(1953) Taylorv.UyTiengPiao,43Phil.873(1922) SmithBellv.Matti,44Phil.875(1922) RustanPulpandPaperMills,214SCRA665(1993) Romerov.CourtofAppeals,250SCRA250SCRA223(1995)

c. Astopossibility(Art.1183)RomanCatholicArchdioceseofManilav.CourtofAppeals,198SCRA300(1991)

d. Astomode:positiveornegative(Art.1184‐1185)

• Rulesincaseofloss,deteriorationorimprovementpendingthehappeningof

thecondition(Art.1189–1190)

HeirsofTimoteoMorenov.MactanCebuInternationalAirportAuthority,413SCRA502(2003)

a. Definitionofloss,deteriorationandimprovementb. Effectoflossordeterioration

• Withoutdebtor’sfault• Withdebtor’sfault

c. Effectofimprovement

• Bynatureortime• Duetodebtor’seffortandexpense

• Effectofpreventionofthefulfillmentoftheconditionbytheobligor(Art

1186)Taylorv.UyTiengPiao,supra.Herrerav.Leviste,135SCRA129(1985)

2. ReciprocalObligations(Art.1191‐1192)

a. Conceptb. Alternativeremediesofinjuredpartiesoncaseofbreach

i. actionforspecificperformance

• effectwhenfulfillmentnolongerpossible

ii. actionforrescission• requisites• howmade• effects

SongFov.HawaiianPhilippines,47Phil.821(1925)Boysawv.InterphilPromotions,148SCRA365(1987)UniversityofthePhilippinesv.delosAngeles,35SCRA365(1989)DeErquiagav.CourtofAppeals,178SCRA1(1989)Angelesv.Calasanz,135SCRA323(1985)JamesG.Ongv.CourtofAppeals,310SCRA1(1999)Iringanv.CourtofAppeals,366SCRA41(2001)VisayanSawMillv.CourtofAppealsandRJTrading,219SCRA378(1993)Deiparinev.CourtofAppealsandTrinidad,221SCRA503(2003)GraceParkEngineeringCo.Inc.v.Dimaporo,107SCRA266(1981)Roquev.Lapuz,96SCRA741(1980)Suriav.IntermediateAppellateCourt,151SCRA661(1987)• Read:Art1786,1788,1484‐86,RepublicActNo.6552

3. ObligationswithaPeriod(Art.1193,1180)

a. ComparePeriod/Termv.Conditionb. KindsofPeriod

i. Astoeffect

• Suspensive(Art1193,par.1)• Resolutory(Art1193,par.2)

ii. Astoexpression• Express• Implied

iii. Astodefiniteness• Definite• Indefinite

iv. Astosource• Voluntary• Legal• Judicial

c. Rulesincaseofloss,deteriorationorimprovementbeforearrivalofthe

period(Art.1194and1189)

d. EffectofPaymentinAdvance(Art.1195;1197,par.3)

e. BenefitofPeriod(Art1196)i. Forwhosebenefit

• Creditor• Debtor• Both

ii. Effectsiii. Presumption(Art.1196)Lachicav.Araneta,47OfficialGazetteNo.11,5699(1949)PoncedeLeonv.Syjuco,90Phil311(1951)Bucev.CourtofAppeals,332SCRA151(2000)iv. Whendebtorlosesrighttomakeuseofperiod(Art.1198)

f. WhenCourtMayFixAPeriod

i. Periodisimpliedii. Perioddependsonsolewillofthedebtor

Aranetav.PhilippineSugarEstateDevelopmentCo.,20SCRA330(1967) CentralPhilippineUniversityv.CourtofAppeals,supra. Deudorv.J.M.Tuason,2SCRA129(1961)

4. AlternativeObligations

a. Concept(Art.1199)b. RightofChoice(Art.1200)c. EffectofNoticeofChoiced. WhenNoticeProducesEffect(Art.1201)e. Effectoflossorimpossibilityofoneorallprestations(Art.1202to1205)f. FacultativeObligation(Art.1206)

i. Conceptii. DistinguishedfromAlternativeObligationsiii. EffectofSubstitution

5. JointandSolidaryObligations

a. JointObligations

i. Concept

• Requisites• Wordsusedtoindicatejointobligations

ii. Presumption(Art.1207,1208)iii. Effects(Art.1207,1208)

• Extentofliabilityofdebtor• Extentofrightofcreditor• Incaseofnovations,compensation,confusion(Art1277)or

remission

b. SolidaryObligations

i. Concept

• Requisites• Wordsusedtoindicatesolidaryobligations

ii. Kinds• Astosource(Art.1208)

o Legal(Art.1915,1945,2194,Art119oftheRPC)o Conventionalo Real

• Astopartiesboundo Activeo Passiveo Mixed

• Astouniformityo Uniformo Varied/non‐uniform(Art.1211)

Ynchaustiv.Yulo,34Phil.978(1916)

Inciongv.CourtofAppeals,257SCRA578(1996)RCBCv.CourtofAppeals,178SCRA739(1989)LafargeCementPhil.V.ContinentalCement,443SCRA522(2004)iii. Effects

• Solidarycreditorinrelationto:o commondebtor

righttodemand(Art.1214‐1216;1217,par.1) incaseofnovation,compensation,confusion,

remissionbyacreditor(Art.1215,par.1)o solidaryco‐creditors

incaseofnovation,compensation,confusion,remissionbyaco‐creditor(Art1215,par.2)

prejudicialactsprohibited(Art.1212) assignmentofrightsnotallowed(Art.1213)

• Solidarydebtorinrelationto:

o commoncreditor obligationtoperform(Art.1207) incaseofnovation,compensation,confusion,

remissionbyacreditor(Art.1215,par.1)o solidaryco‐debtor

incaseofpaymentbyaco‐debtor(Art.1217‐1220) incaseoffortuitousevent(Art.1221)

Jaucianv.Querol,38Phil.718(1918) RehabilitationFinanceCorporationv.CourtofAppeals, OfficialGazetteNo.6,p.2467 Quiombingv.CourtofAppeals,189SCRA325(1990) Inciongv.CourtofAppeals,257SCRA578(1996)

iv. DefensesAvailabletoaSolidaryDebtorAgainsttheCreditor(Art.1222)• Types

o thosederivedfromthenatureoftheobligationso personaldefenseso defensespertainingtohisshareso thosepersonallybelongingtotheotherco‐debtors

• Effects

Ynchaustiv.Yulo,supra. Alipiov.CourtofAppeals,341SCRA441(2000)

c. JointIndivisibleObligations

i. Concept• Distinguishedfromjointobligations• Distinguishedfromsolidaryobligations

ii. Indivisibilitydistinguishedfromsolidarity(Art.1210)iii. Effects(Art.1209,1224)

6. DivisibleandIndivisibleObligations

a. DivisibleObligations

i. Conceptii. Effects(Art.1223,1233)

b. IndivisibleObligations

i. Concept:distinguishedfromsolidaryobligations

ii. Kinds

• Natural(Art.1225,par.1)• Legal(Art.1225,par.3)• Conventional(Art.1225,par.3)

iii. Presumptionsofdivisibilityandindivisibility(Art.1225)

iv. Divisibilityandindivisibilityinobligationsnottodo(Art.1225,par.3)

v. Effects(Art.1223,1223,1224)

vi. CessationofIndivisibility7. ObligationswithaPenalClause

a. Concept

• Principalv.AccessoryObligation• Distinguishedfromconditionalobligations• Distinguishedfromalternativeobligations• Distinguishedfromfacultativeobligations• Distinguishedfromguaranty

b. KindsofPenalClause

• Astoeffecto Subsidiaryo Complimentary

• Astosourceo Conventionalo Legal

• Astopurposeo Punitiveo Reparatory

c. DemandabilityofPenalty(Art.1226,par.2)

d. EffectsofPenalClause:GeneralRuleandExceptions

• Substituteforindemnityfordamagesandpaymentofinterest(Art.1226) MakatiDevelopmentCorp.v.EmpireInsuranceCo.20SCRA557(1967) Tanv.CourtofAppeals,367SCRA571(2001) CountryBankersInsurancev.CourtofAppeals,201SCRA458(1991)

• Notexemptdebtorfromperformance(Art.1227)

• Creditorcannotdemandbothperformanceandpenaltyatthesametime(Art.1227)

• Creditorcannotcollectotherdamagesinadditiontopenalty(Art.1226)

e. Whenpenaltyshallbeequitablyreduced(Art.1229)

f. NullityofPrincipalObligationofPenalClause(Art.1230)

D. ExtinguishmentofObligations(Art.1231)1. PaymentorPerformance(Art.1232)

a. Concept(Art.1232)

b. Requisites

i. Whocanpay

• GeneralRule

• Exceptions:

o thirdpersonwhoisaninterestedparty;effects(Art.1302[3])o thirdpersonwhoisnotaninterestedpartybutwiththeconsentof

debtor(Art.1302[2],1236,par.1)

o thirdpersonwhoisnotaninterestedpartyandwithouttheconsentofthedebtor,withouttheknowledgeoragainstthewillofthedebtor(Art.1236,par.2;Art.1237,1236,par.1)

o thirdpersonwhodoesnotintendtobereimbursed(Art1238)

• inanobligationtogive(Art.1239,1427)

• incaseofactivesolidarity(Art.1214)

ii. Towhompaymentcanbemade

• Generalrule(Art.1240)

• Exceptions:

o incapacitatedperson(Art.1241,par.1)

o thirdperson(Art.1241,par.2)

o whenproofofbenefitnotrequired(Art.1241,par.3;Art.1242)

o incaseofactivesolidarity(Art.1214)

iii. Whatistobepaid(Identity)

• GeneralRule

• Specificcases:

o Togiveaspecificthing(Art.1244)

o Togiveagenericthing(Art.1246)

o Topaymoney(Art.1249,1250;R.A.529,R.A.4100,R.A.8183) Arrietav.NARIC,supra Kalalov.Luz,34SCRA377(1970) St.PaulFireandMarineInsurancev.Macondray,70SCRA122(1976) Papav.A.V.Valencia,284SCRA643(1998) PhilippineAirlinesv.CourtofAppeals,181SCRA557(1990)

• PaymentofInterest(Art.1956)

iv. Howpaymentistobemade(Integrity)• GeneralRule(Art.1233)

o Partialpaymentisnotallowed;exceptions(Art.1248)

• Substantialperformanceingoodfaith(Art.1234)

• Estoppel(Art.1235)

• Presumptionsinpaymentofinterestsandinstallments(Art.1176)

v. Whenispaymenttobemade

• GeneralRule(Art1169)• Nodemand,nodelay;Exceptions

vi. Wherepaymentistomade

• Placeexpresslydesignated(Art.1251,par.1)• Whenplaceofpaymentisnotexpresslydesignated(Art.1251,

paragraphs2to4)

vii. Whopaysforexpensesformakingpayment(Art.1247)

c. ApplicationofPaymentsi. Concept(Art.1252)ReparationsCommissionv.UniversalDeepFishing,83SCRA764(1978)

Paculdov.Regalado,345SCRA134(2000)

ii. Requisites

iii. RulesinApplicationofPayments(Art.1252‐1253)• Ifrulesarenotapplicableorcannotbeinferred(Art.1254)• Meaningofthe“mostonerousdebtor”

d. PaymentbyCession

i. Concept(Art.1255)ii. Requisitesiii. Effectsiv. ComparedtoAssignmentofReceivables

e. DationinPayment

i. Concept(Art.1245)• DistinguishedfromPaymentbyCession

DevelopmentBankofthePhilippinesv.CourtofAppeals,284SCRA14(1998)ii. Requisitesiii. EffectsFilinvestCreditCorporationv.PhilippineAcetylene,111SCRA421(1982)

f. TenderofPaymentandConsignation

i. TenderofPayment• Concept• Requisites

ii. Consignation

• ConceptandPurpose

• Requisiteso Whentenderandrefusalnotrequired(Art.1256,par.2)o Twonoticerequirement(Art.1257,par.1;Art.1258,par.

2);Effectsofnon‐compliance

• Effects(Art.1260,par1)o Withdrawalbydebtorbeforeacceptancebycreditoror

approvalofcourt(Art.1260,par.2)o Withdrawalbydebtorafterproperconsignation(Art.

1261) Withcreditorapproval Withoutcreditorapproval

• ExpensesofConsignation

DeGuzmanv.CourtofAppeals,137SCRA730(1985)

TLGInternationalContinentalEnterprising,Inc.v.Flores,47SCRA437(1972)McLaughlinv.CourtofAppeals,144SCRA693(1986)Socov.Militante,123SCRA160(1983)Sottov.Mijares,28SCRA17(1969)Reisenbeckv.CourtofAppeals,209SCRA657(1992)RuralBankofCaloocanv.CourtofAppeals,104SCRA151(1981)Licuananv.Diaz,175SCRA530(1989)Chanv.CourtofAppeals,230SCRA685(1994)MeatPackingCorp.v.Sandiganbayan,359SCRA409(2001)

2. LossorImpossibility

a. LossoftheThingDue

i. Concept(Art.1189,par.2)

ii. Kinds• Total• Partial

iii. Requisites(Art.1262)

iv. Presumption(Art.1266,1267)

v. Effects

• Inanobligationtogiveaspecificthing(Art.1262,1268)• Inanobligationtogiveagenericthing(Art.1263)• Incaseofpartialloss(Art1264)• Actionagainstthirdpersons(Art.1269)

b. ImpossibilityofPerformance

i. Concept(Art.1266,1267)

ii. Kinds• Total• Partial

iii. Requisites(Art.1266)

iv. Effects

• Inobligationstodo(Art.1266‐1267;Art.1262,par.2)

• Impossibilitydistinguishedfromdifficulty

• Incaseofpartialimpossibility(art.1264)

Occeñav.CourtofAppeals,73SCRA637(1976) NagaTelephoneCompanyv.CourtofAppeals,230SCRA351(1994) PNCCv.CourtofAppeals,272SCRA183(1997)

3. CondonationorRemission

a. Conceptb. Kinds

• Totalorpartial• Expressorimplied(Art.1270,par.1)

c. Requisites(Art.1270,par.2)

Yamv.CourtofAppeals,303SCRA1(1999)

d. Presumptions(Art.1271‐1271;1274)

e. Effects• Ingeneral• Incaseofjointorsolidaryobligations

f. GoverningRules(Art.1270)

g. RenunciationofPrincipalorAccessoryObligation(Art.1273)

4. ConfusionorMerger

a. Concept

b. Requisites

c. Effects

• Ingeneral(Art.1275)• Incaseofjointorsolidaryobligations(Art.1277)

d. ConfusioninPrincipalorAccessoryObligations(Art.1276)

5. Compensation

a. Concept(Art.1278);distinguishedfromConfusion

b. Kinds

i. TotalorPartialii. Legaliii. Conventional(Art.1279,Art.1282)iv. Judicial(Art.1283)v. Facultative

c. LegalCompensationi.Requisites(Art.1279‐1280):DuedistinguishedfromdemandableGantionv.CourtofAppeals,28SCRA235(1969)BankofthePhilippineIslandsv.Reyes,255SCRA571(1996)PhilippineNationalBankv.SapphireShipping,259SCRA174(1996)CKHIndustrialDevelopmentv.CourtofAppeals,272SCRA333(1997)Mirasolv.CourtofAppeals,351SCRA44(2001)AssociatedBankv.Tan,446SCRA282(2004)Villanuevav.Tantuico,182SCRA263(1990)Perezv.CourtofAppeals,127SCRA636(1984)SilahisMarketingCorp.v.IntermediateAppellateCourt,180SCRA21(1989)BankofthePhilippineIslandsv.CourtofAppeals,255SCRA___(1996)ii.Effects(Art.1290,1289)

d. WhenCompensationisnotallowed(Art.1287‐1288)

e. CompensationofDebtsPayableinDifferentPlaces(Art.1268)

f. EffectofNullityofDebtstobeCompensated(Art.1284)

g. EffectsofAssignmentofCredit

i. withconsentofdebtor(Art.1285,par.1)ii. withknowledgebutwithoutconsentofdebtor(Art.1285,par.2)iii. withoutknowledgeofdebtor(Art.1285,par.3)

6. Novation

a. Concept(Art.1291)• Changeindebtor• Changeinobject• Changeinthirdpersonwhoissubrogated• Changeincreditorwithitsconsentoratitsinstanceisnotnovation

b. Kinds

i. Astoform:expressorimpliedii. Astoorigin:conventionalorlegaliii. Astoobject

• objectiveorreal• subjectiveorpersonal• mixed

c. Requisites(Art.1292)

Millarv.CourtofAppeals,38SCRA642(1971)Dormitoriov.Fernandez,72SCRA388(1976)MagdalenaEstatev.Rodriguez,18SCRA967(1966)Reyesv.SecretaryofJustice,264SCRA35(1996)Cochingyanv.RBSuretyandInsurance,151SCRA339(1987)BroadwayCentrumCondominiumCorporationv.TropicalHut,224SCRA302(1993)Molinov.SecurityDinersInternational,363SCRA358(2001)Garciav.Llamas,417SCRA292(2003)CaliforniaBusLinesv.StateInvestment,418SCRA297(2003)Babstv.CourtofAppeals,350SCRA341(2001)

d. Effects(Art.1296)

e. EffectsoftheStatusoftheOriginalandNewObligationi. nullityorvoidabilityoforiginalobligation(Art.1298)ii. nullityorvoidabilityofnewobligation(Art.1297)iii. suspensiveorresolutoryconditionororiginalobligation(Art.1299)

f. ObjectiveNovation

g. SubjectiveNovation

i. Bychangeofdebtor

• Expromision

o Requisites(Art.1293)o Effects(Art.1294)

• Delegacion

o Requisites(Art.1293)o Effects(Art.1295)

Garciav.Llamas,417SCRA292(2003) Quintov.People,305SCRA709(1999)

ii. Bychangeofcreditor–subrogationofathirdpersonintherightsofthecreditor(Art.1300)• Conventionalsubrogation

o Requisites(Art.1301)o Distinguishedfromassignmentofcredito Effects(Art.1303‐1304)

Licarosv.Gatmaitan,(2001)

• LegalSubrogation

o Requisiteso Whenpresumed(Art.1302)

o Effects(Art.1303‐1304)

AstroElectronicsCorp.v.PhilippineExportandForeignLoanGuaranteeCorporation(2003)

Obligations Elements

Subject

Active(Debtor)

Passive(Creditor)

Object

GenericThing

SpecimicThing

SourcesLaw;Contract;QuasiContracts;Delicts;QuasiDelicts

Breach

Substantialbreach

Casualorslightbreach

Howcommitted

Fraud Negligence Delay

Morasolvendi

Moraaccipiendi

Compensatiomorae

Contraventionoftenor

Remedies

Specimicperformanc

eRescission Damages

SubsidiaryRemedies

AccionSubrogatori

sAccionPauliana

law 101-obligations and contracts course outline [mrst]

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obligations and contracts provisions reviewer

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