Rho Notes
DO NOT BE DEFEATIST
CHAPTER I
General Provisions
Obligation- a juridical necessity to give, to
do, or not to do (Art 1156).
Juridical necessity- in case of noncompliance, the courts of justice may be
called upon to enforce its fulfillment or, in
default, the economic value it represents.
Nature of Obligations
Civil obligations- obligations which give to
the creditor or oblige a right of action in
courts
of
justice
to
enforce
their
performance.
Natural obligations- not based on positive law
but on equity and natural law. It does not
grant a right of action for their enforcement.
Requisites of an obligation
1.) A passive subject (the debtor or the
obligor)- the person who is bound to
fulfill an obligation
2.) An active subject (creditor or obligee)the person entitled to demand the
fulfillment of an obligation
3.) Object or prestation (subject matter of
the obligation)- the conduct required
to be observed by the debtor.
4.) A juridical or legal tie (efficient cause)binds or connects the parties to the
obligation.
Obligation- the act or performance which
the law will enforce
Right is the power which the person has
under the law, to demand from another any
prestation.
Wrong is an act or omission of one party in
violation of the legal rights of another,
causing injury to the latter.
Essential Elements of Cause of Action
(1) A legal right in favor of a person
(creditor/plaintiff)
by
whatever
means or under whatever law it
arises or is created.
(2) A correlative legal obligation of
another
(debtor/defendant)
to
respect and not to violate the said
rights.
(3) An act or omission in breach or
violation of the said right by the
defendant with consequential injury
or damage to the plaintiff or other
appropriate relief.
Right of action- the right to commence and
maintain an action. It springs from the cause
of action but does not accrue until all the
facts which constitute the cause of action
have occurred.
An action based on contract accrues only
when an actual breach or violation occurs
(China Banking Corp. v. Court of Appeals)
Actions based upon written contract must be
brought within ten (10) years.
Prescription starts from the occurrence of the
breach.
(1) In an action to rescind a contract of
sale on an installment basis, the
cause of action arises at the time the
last installment was paid.
(2) When the obligation is payable on
demand, the breach starts when
demand is made.
(3) In a contract of loan with real estate
mortgage, whereby the creditor could
unilaterally increase the interest
rate, where the creditor foreclosed
the mortgage when the debtor pay
the loan, the cause of action for the
annulment of the foreclosure sale
should be counted from the date the
debtor discovered the increased
interest rate.
(4) Where the agreement to buy and sell
was conditioned upon the conduct of
a preliminary survey, the right of
action for specific performance arose
only when the plaintiff discovered the
completion of the survey.
(5) In money claims arising from a
contract of employment, which would
prescribe in three (3) years, the cause
of action would arise from the date
the employer made a definite denial
of the employee’s claim.
(6) For the reformation of a contract, an
action for reformation arises when
the
contract
appeared
disadvantageous.
(7) In cases of short delivery, will arise
only from the discovery of the same
with certainty.
1|P age
Prepared by: Rhoanne Shyry Oregila | 1L-Plato
Rho Notes
DO NOT BE DEFEATIST

Injury- the illegal invasion of a
legal right; it is the wrongful act
or omission which causes loss or
harm to another.
 Damage- loss, hurt, or harm
which results from the injury.
 Damages- the sum of money
recoverable as amends for the
wrongful act or omission.
General rule: violation of legal rights must
be accompanied by loss or damage caused to
him.
Exception: for actual or compensatory
damages, pecuniary proof is not necessary.

if the damage results from the
exercise of a person’s rights, it is
damage without injury (damnum
absque injuria).
Art. 1158. Obligations derived from law
are not presumed. Only those expressly
determined in this code or in special laws
are demandable, and shall be regulated by
the precepts of the law which establishes
them; and as to what has not been
foreseen, by the provisions of this Book.
(1090)
Obligations arising from law are not
presumed because they are considered a
burden upon the obligor.
Art. 1159. Obligations arising from
contracts have the force of law between
the contracting parties and should be
complied with in good faith. (1091 a)
Kinds of Obligation according to Subject
matter
1. Real Obligation- Obligation to give;
the subject matter is a thing which
the obligor must deliver to the
obligee.
2. Personal obligation- obligation to do
or not to do
a. Positive Personal obligationobligation to do or render
service.
b. Negative Personal Obligation –
obligation not to do.

Contract- the meeting of the minds
between two or more persons
whereby one binds himself with
respect to the other to give
something or render some service.
It is a formal expression by
the parties of their rights and
obligations they have agreed upon
with respect to the other.
Binding force
ART. 1157. Obligations arise from:
(1)
(2)
(3)
(4)
(5)
Law;
Contracts;
Quasi-contracts
Acts or omissions punished by law;
Quasi-delicts.
Sources of obligations classified
1. Those emanating from law.
2. Those emanating from private acts.
a. Licit acts- the case of
contracts and quasi-contract.
b. Illicit acts- punishable by law
in the case of delicts.
Once perfected, valid contracts have
the force of between the parties who are
bound to comply fully and not selectively
with its terms in good faith.
1. The mere proof of a contract’s
existence and its failure justify,
prima facie, a corresponding right of
relief (FGU Insurance Corp. v. G.P.
Sarmiento Trucking Corp.)
2. Where a purchaser, in an installment
basis, had full knowledge of the
terms and conditions cannot later
feign ignorance of the said rules (Dio
v. St. Ferdinand Memorial Park Ic.)
3. An experienced businessman who
signed legal papers cannot disclaim
the consequent liabilities therefor
after being signatories thereon.
4. Although a contract is considered as
a law between the contracting
parties, the provisions of a positive
law, which regulate such contract are
2|P age
Prepared by: Rhoanne Shyry Oregila | 1L-Plato
Rho Notes
DO NOT BE DEFEATIST
deemed included and shall limit and
govern the relations between parties.
5. A
compromise
agreement
is
immediately executory and not
appealable.
Exception: vices of consent or
forgery
Requirements of a contract
a contract is valid if it is not contrary
to law, morals, customs, public order, and
public policy.
Quasi-contract- juridical relation resulting
from certain lawful, voluntary, and
unilateral acts by virtue of which the parties
become bound to each other to the end that
no one will be unjustly enriched or benefitted
at the expense of the other.
There is no consent but same is
supplied by fiction of law.
Kinds of Quasi-contracts
1. Negotiorum gestio- a voluntary
management of the property or
affairs of another without the
consent of the latter.
Unforceable contract- Valid contract
but cannot be enforced.
*caveat: When the property or
business is not neglected of
abandoned, the provisions of
the Civil Code regarding
unauthorized contract shall
govern.
When the contract requires approval by
the government
A contract only becomes a law
between the contracting parties when
approved.
When the manager
has been tacitly authorized by
the owner, the rules on
agency shall govern.
Compliance in good faith
-compliance or performance of in
accordance with the stipulation or terms of
the contract or agreement.
2. Solutio indebiti- a
juridical
relation created when something
is received when there is no right
to demand it and it was unduly
delivered through mistake .
 There must be no binding
relation
between
the
payor, whi has no duty to
pay, and the person who
received the payment.
 The payment is made
through mistake.
 The obligation to pay
money mistakenly paid
arises from the moment
said payment was made,
not the moment the payee
admits the obligation to
reimburse.
Liability for breach of contract
Interest may, in the discretion of the
court, be allowed upon damages awarded for
breach of contract.
Failure of either party to demand the
performance of an obligation for an
unreasonable length of time may render the
contract ineffective.
The mere failure of a party to respond
to a demand letter in the absence of other
circumstances does not constitute an implied
admission of liability.
Preservation of interest of promisee
A breach upon the contract confers
upon the injured party a valid cause for
recovering that which may have been lost or
suffered.
ART. 1160. Obligations derived from
quasi-contracts shall be subject to the
provisions of Chapter 1, Title XVII, of this
Book. (n)


Presumed quasi-contracts cannot
emerge as against one party when
the subject matter thereof is already
covered by an existing contract with
another party (Cruz v. J.M. Tuazon
Co., Inc.,)
When both parties to a transaction
are mutually negligent in the
performance of their obligations, the
fault of one cancels the negligence of
3|P age
Prepared by: Rhoanne Shyry Oregila | 1L-Plato
Rho Notes
DO NOT BE DEFEATIST
the other (Rodzssem Supply, Inc. v.
Far East Bank & Trust Co.,)
 Quantum meruit- “as much as he
reasonably deserves.” It allows recovery of
any value regardless of any agreement as
to value
 Quantum valebant- as much as what is
reasonably worth”

Requisites of Quasi-delict
1. There must be an act or omission
by the defendant
2. There must be fault or negligence
of the defendant.
3. There must be damage caused to
the plaintiff.
4. There must be direct relation or
connection of cause and effect
between the act or omission and
the damage;
5. There
is
no
pre-existing
contractual relation between the
parties.
Art. 1161. Civil Obligations arising from
criminal offenses shall be governed by
penal laws, subject to the provisions of
Article 2177, and of the pertinent
provisions of Chapter 2, Preliminary Title
on Human Relations, and of Title XVIII of
this book, regulating damages.
(Art. 2177. Responsibility from the
preceding article is entirely separate and
distinct from civil liability arising from
negligence under the Penal Code. But the
plaintiff cannot recover damages twice for the
same act or omission of the defendant.)
Quasi-delict- an act or omission by
a person (tort feasor) which causes
damage to another in his person,
property or rights giving rise to an
obligation to pay for the damage done
, there being fault or negligence
without pre-existing contractual
relation between the parties.
Crime distinguished from quasi-delicts
CRIME (delict)


Only the civil liability arising from the
offense charged is deemed instituted
with the criminal action unless the
offended party waives the civil action.
Reservation and waiver only refer to
recovery of the civil liability arising
from the offense charged, not of civil
liability under Articles 32, 33, 34,
and 2176 of the Civil Code.
Scope of Civil Liability
1. Restitution
2. Reparation for the damage
caused;
3. Indemnification
for
consequential damages.
Art. 1162. Obligations derived from quasidelicts shall be governed by the
provisions of Chapter 2, Title XVII of this
Book, and by other special laws.
Note: Quasi-delicts include not only
injuries to persons, but also damage to
property (Cinco v. Canonoy)
QUASI-DELICT
There is criminal
or malicious
intent or criminal
negligence.
Only negligence
Affects public
interest
Concerns private
interest
Generally two
liabilities:
criminal and civil.
Only civil liability.
Purpose: is
punishment
Purpose:
indemnification
Criminal liability
cannot be settled
by the parties
themselves
Can be
compromised as
any civil liability.
Proved beyond
reasonable doubt.
Preponderance of
evidence.
Liability of person
responsible:
Subsidiary
Direct and
Primary liability.

Quasi-delict includes all acts in
which any kind of fault or negligence
intervenes.
Treats of provision arising from Art. 2176
(torts or quasi-delict).
4|P age
Prepared by: Rhoanne Shyry Oregila | 1L-Plato
Rho Notes
DO NOT BE DEFEATIST
Art. 2176. Whoever by act or omission
causes damage to another, there being
fault or negligence, is obliged to pay the
damage done. Such fault or negligence, if
there is no existing contractual relation
between the parties, is called quasi-delict and
is governed by the provision of this Chapter.
Note:
o
o
o
o
►
►
►
“fault or negligence” in Art. 2176
covers not only acts not punishable
by law but also acts criminal in
character, whether intentional and
voluntary or negligent.
A separate civil action lies against the
offender in a criminal act, whether or
not he is found guilty or acquitted,
provided, that the offended is not
allowed, if the offender is actually
charged also criminally, to recover
damages on both scores and would
be entitled to such eventuality only to
the bigger award of the two,
assuming the awards made in the
two cases vary (Elcano vs. Hill, 77
SCRA 98).
Inasmuch as Arts. 2176 and 2177
create civil liability distinct and
different from the civil action arising
from the offense of negligence under
RPC, no reservation of the right to file
an independent civil action based on
quasi-delict need be made in the
criminal case. Sec. 2, Rule 111 of the
Rules of Court in inoperative because
of its inconsistency with Art. 2177.
Therefore, such right is not barred by
the failure to reserve the same. But
the action for enforcement of civil
liability based on culpa criminal
under Sec. 1, Rule 111 is deemed
simultaneously institutes with the
criminal action, unless expressly
waived or reserved for separate
application by the offended party
(Mendoza v. Arrieta, 91 SCRA 113)
Art. 2180. Art 2176 is demandable
not only for one’s own acts or
omissions, but also for those of
persons for whom one is responsible.
► The father, in case of death
or incapacity, the mother (for
minor children who live in
their company).
► Guardians
(minor
or
incapacitated persons under
their authority)
► Owners and managers (for
damages caused by their
employees in the service of
the
branches
of
their
employment or occasion of
their functions).
Employers
(damages
by
employees and household
helpers acting within the
scope of their assigned tasks).
The State (when it acts
through special agents)
Teachers and heads of
establishments of arts and
trade (damages caused by
their pupils and students or
apprentice in their custody.)
Note: These responsibilities
will cease when they prove
that they observe all the
diligence of a good father to
prevent damage.
Recovery of damages twice for the same
act or omission is prohibited
The same negligent anect or omission
causing damage may produce civil liability
arising from a crime under Article 100 of
RPC.
The offended party has the option
between an action for enforcement of civil
liability based on culpa criminal and an
action for recovery of damages based on
culpa aquiliana.
Ex delicto and ex quasi delicto are two
distinct and independent of each other.
5|P age
Prepared by: Rhoanne Shyry Oregila | 1L-Plato
Rho Notes
DO NOT BE DEFEATIST
6|P age
Prepared by: Rhoanne Shyry Oregila | 1L-Plato