CHAPTER 4, SEC. 5 Compensation (Articles 127812!

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SECTION 5 - COMPENSATION
(Arts. 1278-1290)
STUDY GUIDE :
1. $%at is compensation& (Art. 1278)
Compensation is t%e e'tin()is%ment to t%e conc)rrent amo)nt o* t%e +e,ts o*
t-o persons -%o, in t%eir o-n ri(%t, are +e,tors an+ cre+itors o* eac% ot%er.
2. $%at are t%e .in+s o* compensation as to e'tent or as to t%eir e**ects& (Art. 1281)
(a) T/TA0 -%en ,ot% o,li(ations are o* t%e same amo)nt, an+ are entirel1
e'tin()is%e+.
(b) PART2A0 -%en t%e t-o o,li(ations are o* +i**erent amo)nts, an+ a ,alance
remains.

3. $%at are t%e .in+s o* compensation as to ori(in&
(a) 0E3A0 -%en it ta.es place ,1 operation o* la-, e4en -it%o)t t%e .no-le+(e o*
t%e parties. (Arts. 1279 & 1290)
(b) 5/067TAR8 -%en it ta.es place ,1 a(reement o* t%e parties. (Art. 1282)
(c) 96:2C2A0 -%en it ta.es place ,1 or+er *rom a co)rt in a liti(ation. (Art. 1283)
4. $%at are t%e re;)isites o* le(al compensation& (Art. 1279)
(a) T%e parties m)st ,e principal cre+itors an+ principal +e,tors o* eac% ot%er.
(b) <ot% +e,ts m)st consist in a s)m o* mone1 or, i* t%e t%in(s +)e are cons)ma,le,
t%e1 m)st ,e o* t%e same .in+, an+ also o* t%e same ;)alit1, i* t%e latter %as ,een state+.
(c) T%e t-o +e,ts m)st ,e +)e an+ +eman+a,le.
(d) T%e t-o +e,ts m)st ,e li;)i+ate+.
(e) T%ere m)st not ,e an1 retention or contro4ers1, o4er eit%er o* t%e +e,ts,
commence+ ,1 t%ir+ persons, an+ comm)nicate+ in +)e time to t%e +e,tor.
(f) T%e compensation is not pro%i,ite+ ,1 la-.
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CHAPTER 4, SEC. 5 Compensation (Articles 127812!"#
NOTE: T%e re;)isites mentione+ re*er to compensation ,1 operation o* la-.
E4en i* t%ere is no a(reement 4ol)ntaril1 an+ 4ali+l1 entere+ into, as lon( as all t%e a,o4e
re;)isites are complie+ -it%, compensation -ill set in. (Arts. 1279 & 1290)
5. Can t%e ()arantor set )p compensation as re(ar+s -%at t%e cre+itor ma1 o-e t%e
principal +e,tor&
8ES. Compensation ,ene*its t%e ()arantor (Art. 1280) ,eca)se t%e
e'tin()is%ment o* t%e principal o,li(ation carries -it% it t%at o* t%e accessor1 o,li(ation o*
()arant1.
6. $%at are t%e cases pro4i+e+ )n+er t%e Co+e -%en compensation is pro%i,ite+&
(a) 2* one o* t%e +e,ts arises *rom a depositum, or *rom t%e o,li(ation o* a +epositar1
(Art. 1287, par. 1).
(b) 2* one o* t%e +e,ts arises *rom t%e o,li(ation o* a ,ailee in commodatum
(Art. 1287, par. 1).
(c) 2* one o* t%e +e,ts arises *rom a claim *or s)pport +)e ,1 (rat)ito)s title (e'cept
s)pport in arrears -%ic% ma1 ,e compensate+ -it% t%e +e,t o* t%e person
entitle+ to s)pport# (Art. 1287, par. 2).
(d) 2* one o* t%e +e,ts consists in ci4il lia,ilit1 o* t%e o**en+er arisin( *rom a penal
o**ense (Art. 1288).
NOTE: /nl1 t%e +epositor, ,ailor (len+er#, or t%e o**en+e+ part1, as t%e case
ma1 ,e, can claim t%e ri(%t o* compensation.
APPLICATION/PROBLEMS :
1. D o-es C P1"",""" +)e on =a1 15, 2"1>. G is t%e ()arantor o* D. C also o-es
D P85,""" li.e-ise +)e on =a1 15, 2"1>. /n +)e +ate, D is insol4ent an+ cannot pa1 C.
?or %o- m)c% -ill G, as ()arantor, ,e ma+e lia,le&
2. D o-es W P2"",""" +)e on 9)ne >", 2"1>. /n =arc% 15, 2"1>, D +eposite+
-it% W (-%o -as a -are%o)seman# 1"" ca4ans o* -a(-a( rice 4al)e+ at P2"",""". /n
9)l1 1, 2"1>, -%en D -as alrea+1 -it%+ra-in( t%e +eposite+ rice, W re*)se+ to +eli4er,
claimin( compensation. 2s W allo-e+ to compensate in t%is case&
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