TITLE 1 – OBLIGATIONS
(Arts. 1156 - 13-4, Civil Code.)
CHAPTER 1 - GENERAL PROVISIONS
Article1156 - An "obligation" is a juridical necessity to
give, to do, and not to do.
 Meaning of Obligation
- Derived from the Latin word obligatio
which means tying or binding.
- It is a tie or bond recognized by law by virtue
of which one is bound in favor of another to
render something – and this may consist
in giving a thing, doing a certain act, or
not doing a certain act.
 Civil Code definition (of obligation)
- Article 1156 gives the Civil Code definition of
obligation, in its passive aspect.
- The duty, under the law, of the debtor or
obligor (he who has the duty of giving, doing,
or not doing) when it speaks of obligation as
a juridical necessity.
 Juridical Necessity meaning
- Obligation is a juridical necessity because in
case of noncompliance (of debtor or
obligor), the courts of justice may be called
upon by the aggrieved party (creditor or
obligee) to enforce its fulfillment or, in
default thereof, the economic value that
represents.
- Debtor/Obligor may be made liable for
damages, which obliges him/her to pay
money as a compensation for injury or harm
suffered by the creditor/oblige for the
violation of his/her rights.
 Nature of Obligations under the Civil Code
- Civil Obligations: Obligations which give to
the creditor or obligee a right under the law
to enforce their performance in courts. They
-
are to be distinguished from natural
obligations.
Natural Obligations: Not based on positive
(state) law but on equity and natural law; Do
not grant a right of action to enforce their
performance.
 Essential Requisites of an Obligation
- Every obligation has four (4) requisites:
1. Active Subject (creditor or oblige) - the
person who is entitled to demand the
fulfillment of the obligation; he who has the
right.
2. Passive Subject (debtor or obligor) - the
person who is bound to the fulfillment of the
obligation, who has a duty to fulfill.
3. Object or Prestation (subject matter of the
obligation) - the conduct required to be
observed by the debtor. It may consist in
giving, doing, or not doing. (What is the duty
of debtor/obligor in the situation?
(Ex. X is liable of building the house.)
4. Juridical or Legal Title (efficient cause) that
which binds or connects the parties to the
obligation, the source of obligation.
(Ex. Agreement or contract)
 forms of Obligations
- Refers to the way an obligation is manifested
or incurred.
- It may be oral, or in writing, or partly oral and
partly in writing.
- (1) As a general rule. The law does not
require any form for obligations arising from
contracts for their validity or binding force.
- (2) Obligations arising from other sources do
not have any form at all.
 Obligation, Right, and Wrong (distinguished)
Obligation: The act or performance which the law will
enforce.
Right: The power which a person has under the law, to
demand from any other prestation.
Wrong (cause of action): (Legal meaning) An act or
omission of one party in violation of the legal right or
rights (recognized by law) of another. Also known as
"injury" which refers to the wrongful violation of the legal
right of another.
 ART. 1157 - OBLIGATIONS ARISE FROM:
- Law
- Contracts
- Quasi-contracts
- Acts or omissions punished by law
- Quasi-delicts
Essential elements of a legal wrong or injury are:
a) A legal right in favor of a person
(creditor/obligee/plaintiff)
b) A correlative legal obligation on the part of
another (debtor/obligor/defendant); to respect
or not to violate said right.
c) An act or omission by the latter in violation of
said right with resulting injury or damage to the
former.
-
-
An obligation on the part of a person cannot
exist without a corresponding right in favor
of another, and vice versa.
A wrong or cause of action only arises at the
moment a right has been transgressed or
violated.
 Kinds of Obligation according to the Subject
Matter
- Obligation may either be real or personal.
1) Real Obligation (obligation to give)
- The subject matter is a thing which the
obligor must deliver to the obligee. Ex. Seller
binds self to deliver product to buyer.
2) Personal Obligation (obligation to do or not
to do)
- The subject matter is an act to be done or
not to be done.
Types of Personal Obligation:
a) Positive Personal Obligation - obligation to do
or to render service. Ex. X binds himself to
repair the piano of Y.
b) Negative Personal Obligation - obligation not to
do or not to give. Ex. X obliges himself not to
build a wide fence as Y is entitled to a right to
walk by that part of fence.
 Sources of Obligations
1) Law
- When they are imposed by law itself.
- Ex. Obligation to pay taxes and support
family.
2) Contracts
- When they arise from the stipulation of the
parties
- Ex. Obligation to repay a loan or
indebtedness by virtue of an agreement.
3) Quasi-contracts
- When they arise from lawful, voluntary, and
unilateral acts which are enforceable to the
end that no one shall be unjustly enriched
or benefited at the expense of another.
- In a sense, these obligations may arise from
law.
- Ex. Obligation to return money paid by
mistake or which is not due.
4) Crimes or act or omissions punished by law
- When they arise from civil liability which is
the consequence of a criminal offense.
- Ex. Obligation of thief to return stolen car
5) Quasi-delicts or torts
- When they arise from damage caused to
another through an act or omission, there
being fault or negligence, but no
contractual relation exists between the
parties.
- Ex. Obligation of an owner to pay for the
damages his/her pet animal has caused.
 Sources Classified
- The law enumerates five (5) sources of
obligations. However, they may be classified
as follows:
1) Those emanating from law
2) Those emanating from private acts which may
be further subdivided into:
a. Those arising from licit acts, in the case of
contracts and quasi-contracts.
b. Those arising from illicit acts, which may be
either punishable in the case of delicts or
crimes, or not punishable in the case of
quasi-delicts or torts.
-
There are only two (2) sources of
obligations: Law and Contracts because
obligations arising from quasi-contracts,
delicts, and quasi-delicts are really imposed
by law.
 LEGAL OBLIGATIONS (ART. 1158)
- Obligations derived from law are not
presumed. Only those expressly determined
in this Code or in special law are
demandable and shall be regulated by the
precepts of the law which establishes them.
- Article 1158: Refers to legal obligations or
obligations arising from law. They are not
presumed because they are considered a
burden upon the obligor.
- They are the exception, not the rule. To be
demandable, they must be clearly set forth
in the law.
- Ex. (1) An employer has no obligation to
furnish free legal assistance to his
employees because no law requires this,
and therefore, an employee may not
recover from his employer the amount he
may have paid to a lawyer to recover
damages caused to said employee by a
stranger while performing his duty.
- Ex. (2) A private school has no legal
obligation to provide clothing allowance to
its teachers because there is no law which
imposes this obligation upon schools.
 CONTRACTUAL OBLIGATIONS (ART. 1159)
- Obligations arising from contracts have the
force of law between the contracting
parties and should be complied with in
good faith.
- Obligations arising from contracts or
voluntary agreements. It presupposes that
-
the contracts entered are valid and
enforceable.
Contract: Meeting of minds between two
(2) (or more) persons whereby one binds
himself, with respect to the other, to give
something or to render some service.
a. Binding force:
- Obligations arising from contracts have the
force of law between the contracting
parties.
- They have the same binding effect of
obligations imposed by law. (Contract is not
superior to the law).
- As a source of enforceable obligation,
contract must be valid (it cannot be valid if
it is against the law).
b. Requirement of a valid contract:
- A contract is valid (assuming all the
essential elements are present) if it is not
contrary to law, morals, good customs,
public order, and public policy.
- It is invalid or void if it is contrary to law,
morals, good customs, public order, or
public policy.
- In the eyes of the law, a void contract does
not exist. Consequently, no obligations will
arise.
- A contract may be valid but cannot be
enforced. (Unenforceable contracts).
c. Breach of contract:
- A contract may be breached or violated by a
party in a whole or in part.
- It takes place when a party fails or refuse to
comply, without legal reason or
justification, with his obligation under the
contract promised.
Compliance in Good faith:
- It means compliance or performance in
accordance with the stipulations or terms of
the contract or agreement. Sincerity and
honesty must be observed to prevent one
party from taking unfair advantage over the
other.
-
-
-
Non-compliance by a party with his
legitimate obligations after receiving the
benefits of a contract would constitute
unjust enrichment on his part.
Ex. Buying and selling housing contract
between S and B. Neither of them shall
withdraw from contract. It must be
complied in good faith.
Ex. Contract will S has to kill is void and nonexistent because it is contrary to the law.
 QUASI-CONTRACTUAL OBLIGATIONS (ART.
1160)
- Article 1160: Treats of obligations arising
from quasi-contracts or contracts implied
by law.
- Quasi-contract: Juridical relation resulting
from 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 benefited at the
expense of another.
- Not a contract at all: There is no consent
but the same is supplied by fiction of law. In
other words, law considers the parties as
having entered a contract,
- although they have not actually do so, and
irrespective if their intention, to prevent
injustice or unjust enrichment of a person
at the expense of another.
Principal Kinds of Quasi-contracts:
a. Negotiorum gestio - the voluntary management
of the property or affairs of another without the
knowledge or consent of the latter. (Ex. Putting
out the fire of neighbor's house because they
are on a vacation. Neighbor is obliged to
compensate them even if they did not give
consent to the act.); felt the responsibility.
b. Solutio Indebiti - the juridical relation which is
created when something is received when there
is no right to demand, and it was unduly
delivered through mistake; Based on principle
that no one shall enrich himself unjustly at the
expense of another.
Requisites: (1) There is no right to receive the
thing delivered and (2) The thing was delivered
through mistake.
c. Other examples of quasi-contracts - Provided in
Articles 2164 to 21fi5 of the Civil Code. Quasicontracts are of infinite variety, and when for
some reason recovery cannot be had on a true
contract, recovery may be allowed based on a
quasi-contract. Ex. Seller leaves goat milk every
day at a house. After 1 week, payment is
collected. It is implied that contract is
understood.
 CIVIL LIABILITY ARISING FROM CRIMES OR
DELICTS (ART. 1161)
- Civil obligations arising from criminal
offenses shall be governed by the penal
laws.
- Article 1161: Deals with civil liability for
damages arising from crimes or delicts.
1) Civil liability in addition to criminal liability:
- Oftentimes, commission of a crime causes
not only moral evil but also material
damage.
- Those who are criminally liable for an act or
omission is also civilly liable for damages
suffered by aggrieved party.
2) Criminal liability without civil liability:
- In crimes which cause no material damage,
there is no civil liability to be enforced.
3) Civil liability without criminal liability:
- A person not criminally responsible may still
be liable civilly, such as failure to pay a
contractual debt, causing damage to
another's property without malicious or
criminal intent or negligence.
Scope of Civil Liability:
- The extent of the civil liability for damages
arising from crimes is governed by the
Revised Penal Code and the Civil Code. This
civil liability includes:
- (1) Restitution (2) Reparation for the
damage caused (3) Indemnification for
consequential damages.
 OBLIGATIONS ARISING FROM QUASI-DELICTS
(ART. 1162)
- Quasi-delicts: An act or omission by a
person (tortfeasor) 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 but there is no pre-existing
contractual relation between the parties.
Requisites of Quasi-delict:
- Before a person can be held liable for quasidelict, the following must be present:
- (1) There must be an act or omission
- (2) There must be fault or negligence
- (3) There must be damaged caused
- (4) There must be a 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 parties.
Crime distinguished from quasi-delict:
1) Crime: There is criminal or malicious intent or
criminal negligence.
Quasi-delict: There is only negligence.
2) Crime: Purpose is punishment.
Quasi-delict: Indemnification of the offended
party.
3) Crime: Affect public interest.
Quasi-delict: Concerns private interest.
4) Crime: There are generally two liabilities (1)
criminal and (2) civil.
Quasi-delict: Only civil liability.
5) Crime: Liability cannot be compromised or
settled by the parties themselves.
Quasi-delict: Liability can be compromised as
any other civil liability.
6) Crime: The guilt of the accused must be proved
beyond reasonable doubt.
Quasi-delict: The fault or negligence of the
defendant need only be proved by
preponderance of evidence.
THE GENERAL RULE OF LAW
Law – any rule of action or any system of uniformity;
determines not only the activities if men as rational
beings but also the movements or motions of all objects
of creation-- animate or inanimate
GENERAL DIVISIONS OF LAW
1) State Law – promulgated and enforced by the
state
2) Divine, Natural, Moral & Physical Law – not
promulgated and enforced by the state
Sate, Divine, Natural and Moral Law –
comprised as a rule of action, apply to men as
rational beings
Physical Law – operates on all things including
men w/o regard on rational thinking;
figuratively speaking
LAWS WHICH THE STATE IS NOT CONCERNED WITH
1) Divine Law – law on religion and faith; concept
of sin. Sanction is rewards or punishments
2) Natural Law – caused by internal dictates of
reason alone, moral nature, basis of state law
3) Moral Law – totality of norms of right and
wrong; perception of the community; varies w/
time
4) Physical Law – laws of physical science, law only
by analogy; objects have no power to disobey.
STATE LAW
- Also called positive law, municipal law, civil law,
or imperative law
- Does not concern itself w/ the latter rules of
action unless it also constitutes violation of its
commands
- General sense: refers to all laws taken together;
mass of obligatory laws established for the
purpose of governing
- the relations of persons in society
- Specific sense: a rule of conduct promulgated
by the legitimate authority of common
observance or benefit.
CHARACTERISTICS OF LAW (SPECIFIC SENSE)
1) It is a rule of conduct – what shall and shall not
be done, external acts only
2) It is obligatory – positive command, w/ duty to
obey; impose sanctions for disobedience
3) It is promulgated by legitimate authority –
enacted by the legislature (Congress)
4) It is of common observance and benefit –
intended to serve man, maintain order and
harmony in society
SOURCES OF LAW
1) Constitution – fundamental law, supreme law
or highest law; the law by which all other laws
are enacted by legislature must conform, laws
inconsistent w/ constitution shall be void; the
latter shall govern
2) Legislation – declaration of legal rules by
competent authority, preponderant source of
law in the PH, includes ordinances enacted by
LGU’s; also called enacted laws or statute laws
3) Administrative/executive orders, regulations
and rulings – carried by admin officials under
legislative authority; explain the law and carry
out its general provisions; Admin. acts are valid
only when not contrary to constitution
4) Judicial decisions/ Jurisprudence – decisions of
the supreme court implementing the
constitution; the decision of the Supreme Court
is binding among all subordinate courts;
doctrine of precedence (stare decisis).
However,
the SC may modify or reverse any of its previous
rulings
5) Custom – habits/practices which due to its long
uninterrupted usage have become
acknowledged and approved by society as
binding rules of conduct, custom must be
proved as fact according to the rules of
evidence
6) Other sources – principles of justice and equity,
decisions of foreign tribunals, opinions of text
writers and religion. They are only
supplementary, only applied in the absence of
all other sources; not binding on courts
CLASSIFICATIONS OF LAW
1) As to its purpose
a) Substantive law – creating, defining
regulating rights and duties which may
either be public/private
i.
Law on Obligations and Contracts
b) Adjective law – manner or procedure by
which rights may be enforced or their
violations redressed
i.
Remedial law or Procedural law
ii.
It is governed by the Rules of Court
promulgated by the Supreme Court and
special laws
2) As to its subject matter
a) Public law – rights and duties arising from
the relationship of the state and its people
i.
Criminal law – defines crimes and
provides punishment
ii.
International law – governs relations
among nations or states
iii.
Constitutional law – governs relations
between state and its citizens;
establishes the fundamental powers of
government
iv.
Administrative law – governs the
methods by which the functions of
administrative authorities are to be
performed
v.
Criminal procedure – branch of private
law w/c governs methods of trial and
punishment in criminal cases
b) Private law – regulates relations of
individuals with one another for purely
private ends, the state enforces private law
but only as an arbiter and not as a party
i.
Law on Obligations and Contracts
ii.
Civil Law
iii.
Commercial Law
iv.
Civil procedure – provides for the
means by which private rights may be
enforced.