Solidary and Joint Obligations: Condonation, Assignment, and Novation, Summaries of Economics

Download Solidary and Joint Obligations: Condonation, Assignment, and Novation and more Summaries Economics in PDF only on Docsity! M. D. Vicente, Obligations SECTION 4. – Joint and Solidary Obligations STUDY GUIDE I. Definitions Define or give the meaning of the following: parts. . 1. Joint obligation - where the whole obligation is to be paid or fulfilled proportionately by the different debtors and demanded proportionately by the different creditors. 2. Solidary obligation - where each one of the debtors is bound render, and/or each creditor has the right to demand from any of the debtors, the entire compliance with the prestation 3. Active solidarity - one of the solidary creditors can demand the payment or performance of the entire obligation from the debtor or any of the debtors. (There is mutual representation w/ power to exercise the rights of others in the same manner as their own rights) 4. Joint indivisible obligation - the debtors are bound only to the extent of their share in the obligation which can only be performed totally or completely, not partially 5. Solidary divisible obligation - parties are merely proportionately liable to the object/subject matter which are physically divisible into different II. Discussions 1. If there are two or more debtors in one and the same obligation, is there liability joint or solidary? Explain. ARTICLE 1207, the concurrence of two or more creditors or of two or more debtors in one and the same obligation does not imply that each one of the former has a right to demand, or that each one of the latter is bound to render, entire compliance with the prestation. There is a solidary liability only when the obligation expressly so states, or when the law or the nature of the obligation requires solidarity. 4. A, B, and C are solidarily liable to D. For their failure to pay, D filed a complaint in court but only against C. Has C the right to demand that A and B be also included as party defendants? According to Article 1216, C has no right to demand from D to include A and B as party defendants because C, as a solidary debtor can be compelled to pay for the entire obligation.Art. 1216. The creditor may proceed against any one of the solidary debtors or some or all of them simultaneously. The demand made against one of them shall not be an obstacle to those which may subsequently be directed against the others, so long as the debt has not been fully collected 5. A, B, and C, co-owners, sold a printing equipment to D. They solidarily bound themselves to deliver the equipment on a certain date. Through the fault of C, the equipment was completely destroyed. Give the rights and obligations of the parties. According to Article 1221, as far as D is concerned, A, B and C are all liable for the price of the printing equipment as well as damages. A and B can recover from C since it was through his fault that the object was destroyed. If C paid for the price and damages, he cannot ask for reimbursement from A or B.Art. 1221. If the thing has been lost or if the prestation has become impossible without the fault of the solidary debtors, the obligation shall be extinguished.If there was fault on the part of any one of them, all shall be responsible to the creditor, for the price and the payment of damages and interest, without prejudice to their action against the guilty or negligent debtor.If through a fortuitous event, the thing is lost or the performance has become impossible after one of the solidary debtors has incurred in delay through the judicial or extrajudicial demand upon him by the creditor, the provisions of the preceding paragraph shall apply. SECTION 5. – Divisible and Indivisible obligation STUDY GUIDE I. Definitions Define or give the meaning of the following: 1. Divisible obligation - is one where the object of which, in its delivery or performance, is capable of partial fulfillment. 2. Indivisible obligation - is one where the object of which, in its delivery or performance, is not capable of partial fulfillment. 3. Legal indivisibility - an indivisible obligation set by law even if the object is by nature divisible. II. Discussions 1. Explain. The divisibility of an obligation is different from the divisibility of the thing which is the object thereof. According to Art. 1223, the obligation’s divisibility or indivisibility is not determined by the divisibility or indivisibility of its object. Even if the object is divisible but the law or the parties intend the obligation to be indivisible, then it is indivisible. But if the object is indivisible, the obligation is always indivisible as well. 2. What obligations are deemed indivisible? Obligations deemed Indivisible Obligation provided by law to be indivisible even if thing or service physically divisible 3. What obligations are deemed visible? Obligations deemed Divisible Obligations which have for their the execution of a certain number of days of work. III. Problems Explain or state briefly the rule or reason for your answer. 1. A and B bind themselves to pay C their loan of P10,000 on a certain date. Is the obligation divisible or indivisible? According to Art. 1225, Indivisible, as stated on the contract that A and B bind themselves to pay C their loan P10,000 on a certain date. 2. A, B, and C oblige themselves jointly to deliver to D a particulars horse on a certain date. The agreement among A, B, and C which was made known to D is that they will contribute the amount in buying the horse. The horse was not delivered on the due date because of the failure of B to give his share of the purchase price. State the rights and obligations of the parties. According to Art. 1224, The obligation to deliver the horse is converted into money obligation, meaning, A, B and C will contribute the amount in buying the horse. A and C are liable to give their shares. But, A and C are not liable for the share of B. On the other hand, B is now indebted to D. Damages may be imposed against “B” the erring debtor if warranted by the circumstances. 3. D finds himself to pay his loans of P10,000 in four equal monthly installments. Is the obligation of D divisible or indivisible? According to Art. 1225, loans to be paid by installments are deemed divisible obligations. However, each installment of P2,500 is indivisible. Chapter 4 EXTINGUISHMENT OF OBLIGATION SECTION 1. – Payment or Performance STUDY GUIDE I. Definition Define or give the meaning of the following: 1. Payment - Payment means not only the delivery of money but also the performance, in any other manner, of an obligation. 2. Dation in payment - is the conveyance of ownership of a thing as an accepted equivalent of performance. An existing debt in money is satisfied, not by payment of money but by the alienation of property. 3. Application of payment - It is the designation of the debt to which should be applied the payment made by a debtor who has various debts of the same kind in favor of one. 4. Payment of cession - is another special form of payment. It is the assignment or abandonment of all the properties of the debtor for the benefit of his creditors in order that the latter may sell the same and apply the proceeds thereof to the satisfaction of their credits. 5. Consignation - is the act of depositing the thing or amount due with the proper court when the creditor does not desire or cannot receive it, after complying with the formalities required by law. It is always judicial and it 3. D owes C P10,000 which was paid by T who demands reimbursement from D. a) When is D liable to T? b) When is D no liable to T? c) When is D liable for less than P10,000 to T? d) May D be liable to T for P12,000 if that was the amount paid by him to C? 4. D owes C P10,000. Without the knowledge of C, D in good faith paid to T his obligation to C. Is D required by law to prove that the payment has been received by C in order to be released from liability? 5. D owes C P10,000 in payment for which C accepts a check form D. On the ground that a check is not legal tender, C later insists that D pay him in cash. Is D justified in rejecting this demand of C? SECTION 2. – Loss of the thing Due STUDY GUIDE I. Definitions Define or give the meaning of the following: 1. Legal impossibility - occurs when the obligation cannot be performed because it is rendered impossible by provision of law, although physically it may be possible of performance. 2. Loss of thing - when it perishes, or goes out of commerce or disappears in such a way that its existence is unknown or it cannot be recovered. 3. Difficulty performance - performance has become so difficult as to be manifestly beyond the contemplation of both parties. Discussions 1. Give two cases when a person may be released from an obligation validly entered into. 2. Give the cases when loss of specific thing to be delivered will not exempt the obligor from liability even in the absence of fault or delay. 3. Will partial loss of the specific thing to be delivered extinguish the obligation? Explain. II. Problems Explain or state briefly the rule or reason for your answer. 1. X obliged himself to deliver to Y a specific carabao to Y on July 31. The carabao died on July 25. Y has no proof that X was negligent. Is X liable to Y? 2. X obliged himself to deliver a specific thing to Y on a certain date. The thing was lost by X without his fault and before he has incured in delay. Does its mean that X is already exempted from liability? 3. Suppose in the preceding problem, the thing as lost through the fault of Z, a 3rd person. State the effect of the loss as far as X, Y, and Z are concerned. SECTION 3. – Condonation or Remission of Debt STUDY GUIDE I. Definition Define or give the meaning of the following: 1. Condonation or remission of debt - is the gratuitous abandonment by the creditor of his right against the debtor. It is thus a form of donation. 2. Inofficious remission Discussions 1. Give the requisites in order that a condonation or remission of debt may be valid. · It must be gratuitous · It must be accepted by the obligor · The parties must have capacity · It must not be inofficious · If made expressly, it must comply with the forms of donations 2. When is the condonation or remission of debt considered inofficious? What is the remedy of the party adversely affected thereby? II. Problems Explain or state briefly the rule or reason for your answer. 1. D (debtor) borrowed money from C (creditor) evidenced by a promissory note signed by D. a) What presumption arises if: 1) The promissory note is voluntarily given by C to D? 2) It is found in the possession of D? b) When will the presumption of remission arise? 2. Suppose in the same problem, the debt of D, aside from being guaranteed by G, is secured by a pledge of a certificate of shares of stock delivered by D to C. What presumption arises if: a) The debt of D is condoned by C? b) The certificate is later found in the possession of D? SECTION 4. – Confusion or Merger of Rights STUDY GUIDE 4. After contracting, a debt in the amount of P10,000 favor of C, D succeeded through fraudulent means to make C liable to him in the same amount. Assuming that both obligations are now due, may the two debts be compensated against each other? What is the effect if the debt of C is later annulled in court at the instance of D? SECTION 6. - Novation STUDY GUIDE I. Definition Define or give the meaning of the following: 1. Novation - is the extinction of an obligation through the creation of a new one which substitutes it. 2. Mixed novation - when the object and the debtor or the creditor, or both the parties, are changed. It is a combination of real and personal novations. 3. Expromission - takes place when a third person of his own initiative and without the knowledge or against the will of the original debtor assumes the latter’s obligation with the consent of the creditor. It is essential that the old debtor be released from his obligation, otherwise, there is no expromission. 4. Delegacion - takes place when the creditor accepts a third person to take place of the debtor at the instance of the latter. All the parties, the old debtor and the new debtor, and the creditor must agree. II. Discussions 1. Give the requisites of novation. · A previous valid obligation · Capacity and intention of the parties to modify or extinguish the obligation · The modification or extinguishment of the obligation · The creation of a new valid obligation 2. When there is subrogation, what rights are acquired by the new creditor? - Article 1304. A creditor, to whom partial payment has been made, may exercise his right for the remainder, and he shall be preferred to the person who has been subrogated in his place in virtue of the partial payment of the same credit. 3. In novation, give the effect where: a) The new obligation is voidable b) The old obligation is voidable. Explain. 4. In novation are accessory obligations necessarily extinguished? Explain. III. Problems Explain or state briefly the rule or reason for your answer. 1. T (third person) tells C (creditor) that T is will pay the debt of D (debtor). C agrees. Is D released from his obligation to C? 2. Suppose in the above problem, D proposed to C that T would substitute D as the new debtor to which C agreed. Is D still liable to C in case of insolvency of T? 3. T paid C the debt of D a without objection from the latter. What are the rights of T? 4. Illustrate a mixed novation.