Law of Obligation and Contracts: Short Reviewer, Schemes and Mind Maps of Law of Obligations

Download Law of Obligation and Contracts: Short Reviewer and more Schemes and Mind Maps Law of Obligations in PDF only on Docsity! Nature and Effects of Obligation • Celia already has a right to the fruits of the lemon plant from the time of the perfection of the contract. However, she does not have real right over it until the plant has been delivered to her. So, she can’t harvest the fruits until the plant has been delivered to her on September 25 • It is valid for future negligence. However, if the contract states that any future FRAUD will be considered waived, Edmund will still be liable for damages • No demand yet. The debtor incurs in delay from the time the creditor demands fulfillment. This is the general rule. Pure Obligations • Aside from a pure obligation, obligations subject to a resolutory condition or a resolutory period are also demandable at once Conditional Obligations • An event MUST be future AND uncertain for it to be a condition. It can also be a past event, provided that neither party knows said event, and will know of it in the future. It MUST NOT BE IMPOSSIBLE • OTHER WAY AROUND. The happenstance of a suspensive condition causes the obligation to arise. Until it happens, the existence of the obligation is a mere hope. Once a resolutory condition is fulfilled, the obligation is extinguished. If it doesn’t happen, the effects flow • The obligation was to deliver a SPECIFIC/DETERMINATE THING, since it was HIS journal. The loss of a specific thing under fortuitous events (lightning strike) extinguishes the obligation • Jason can only collect Php 10,000 because the appreciation of the laptop’s value inured to the benefit of Leo. Inured means “accustomed to accept something undesirable”. The obligation was set with the condition that Leo will only pay Php10,000, so that’s what he’s obliged to pay upon the happening of the condition. The same happens if obligation within a period. Obligations with a Period • They both fixed the period to be within a time beneficial to both of them. Article 1196. This is the general rule, but it can be rebutted • This is considered by law as an obligation with a period. Even though the actual date is unknown, the day WILL come when the debtor has the means • If the obligation does not fix a period but from the nature and the circumstances it can be inferred that a period was intended, the Court may fix one for the parties. Alternative and Facultative Obligations • It generally belongs to the Debtor, unless it has been expressly granted to the creditor. The debtor shall have no right to choose the prestations which are impossible, unlawful, or which could not have been the object of the obligation • A facultative obligation is one wherein only one prestation is due or agreed upon, but the obligor may substitute the prestation for another. • The first is an alternative obligation since there are two prestations presented. The second is alternative since only one prestation is presented, but it can be substituted by another Joint and Solidary Obligations • Joint Obligations – as many debts as there are debtors + as many credits as there are creditors; Solidary Obligations – 1 debtor, 1 creditor regardless of how many personalities there are. Collective obligation is presumed to be joint • A collective obligation is presumed to be joint. Hence, there are two debts since there are two debtors. Kitty may only collect from Everest the amount of her debt, and he may only collect from Skye the amount of her debt • They are all solidarily liable, so there is only one debt to be fulfilled. Annabeth is liable to pay the entire debt of Php 15,000, but she can ask for Php 7,500 reimbursement from Percy since Grover’s insolvency meant both Percy and Annabeth bear his share proportionately • Baz and Simon are joint creditors with a 1:2 share. This means that the Php 12,000 is split among them 1:2, with Baz having Php 4,000 and Simon having Php 8,000. This means that Simon can only collect Php 8,000. On the other hand, the debtors are solidary: there is only one debt despite there being three of them. Since Athena is already insolvent, either Bianca or Clarisse will shoulder her share in the debt in proportion to their aforementioned share. The one who pays may seek reimbursement from the one who didn’t Divisible and Indivisible Obligations • REMEMBER: o AN OBLIGATION IS PRESUMED TO BE INDIVISIBLE WHERE THERE IS ONLT ONE CREDITOR AND ONE DEBTOR o The divisibility of an obligation should not be confused with the divisibility of the thing which is the object thereof. For example, rent can be paid in monthly installments, so the rent itself is divisible. However, if the rent to be paid should be paid in one sitting only, the obligation becomes indivisible even though the object (money) itself is divisible Obligations with a Penal Clause • It may. A penal clause is an accessory attached to an obligation to assume greater liability in case of breach. It MAY be demandable, given the proper stipulation • As a general rule, penalty takes the place of indemnity for damages and the payment of interests in case of non- compliance. However, in the cases mentioned above, the creditor may recover damages and interests from the debtor along with the penalty • The principal obligation must be fulfilled, and the penal clause is simply there in case of non-compliance. It serves as a reparation or punishment rather than a substitution Extinguishment of Obligations Payment or Performance • The debtor of a thing cannot compel the creditor to accept a different one, regardless of quality or value. For generic things whose quality have not been stated, the creditor cannot demand a thing of superior quality and the debtor cannot give a thing of inferior quality. • Legal Tender is the money or currency which the debtor may compel his creditor to accept in payment of his debt • Common consent is an essential prerequisite for dation In payment to be valid. Dation in payment is basically a special form of payment where the ownership of property is transferred to his creditor to pay a debt in money. It is governed by law of sales • The debts must be of the same kind. Also remember that: o The debtor who is given the preferential right to apply the payment designates the debt to be paid o If debtor does not make designation, creditor makes it by indicating debt being paid in his receipt o If neither makes designation, payment shall be applied: 1. To the debt most onerous to the debtor 2. If debts are of same nature, to all due debts proportionately • Cession only authorizes the creditors to sell the debtor’s property to recover their claims out of the proceeds. Unless agreed upon, it releases the debtor from his responsibility only to the extent of the net proceeds Loss of the Thing Due • The obligation was to deliver a SPECIFIC/DETERMINATE THING, since it was HIS journal. The loss of a specific thing under fortuitous events (lightning strike) extinguishes the obligation Condonation or Remission of the Debt • In simple words, condonation or remission is the forgiveness of indebtedness. Remember that it REQUIRES THE DEBTOR’S CONSENT. If Dorothy does not accept Toto’s generosity, the obligation is still standing. Confusion or Merger • This is for a joint obligation. In a solidary obligation, merger in the person of one of the solidary debtors shall extinguish the entire obligation because there is only one debt