CHAPTER THREE

DIFFERENT KINDS OF OBLIGATIONS

Conditional Obligation - one whose effectivity is subordinated to the

fulfillment or non-fulfillment of a future and uncertain act or event.

Sec. 1. - Pure and Conditional Obligations

Is a past event unknown to the parties be considered as a condition?

According to Sir Ulan, quoting Tolentino, a past event
cannot be future and uncertain, which are the elements of a
condition, and thus cannot be one. What can be a condition is the
future knowledge or proof of a past event unknown to the parties, but
NOT the event itself. Thus the contract or obligation arises, not when
the event happened or the fact came into existence, which would be
in the past, but when the proof of such fact or event is presented,
which would be in the future.

Art. 1179. Every obligation whose performance does not depend

upon a future or uncertain event, or upon a past event unknown
to the parties, is demandable at once.
Every obligation which contains a resolutory condition shall
also be demandable, without prejudice to the effects of the
happening of the event.
Pure Obligation- one whose effectivity or extinguishment does not
depend upon the fulfillment or non-fulfillment of a condition or upon
the expiration of a term or period.
Elements:
a) Not subject to a condition
b) Not subject to a term
Characterized by the quality of immediate demandability,
but there must be a reasonable period of grace.
*Immediate demandability: It does not mean outright but
speaks of a reasonable time; depends on the nature and
complexity of the obligation.
Simple Obligation does not equal to pure Obligation.
Former speaks of an obligation with only one prestation,
while the latter speaks of an obligation that does not
depend on a condition or period.
Obligations that are immediately demandable:
1. Pure obligations (Art 1179)
2. Obligations with resolutory condition (Art. 1179, par.2)
3. Obligations with resolutory period (Art. 1193, par.2)
4. Obligations with a condition not to do an impossible thing
(Art. 1183, par.2)
2 Types of Events:
1. Condition a future and uncertain event upon which the
acquisition and resolution of rights is made to depend by those who
execute the juridical act
Characteristics:
Future
Uncertain may or may not happen
Possibility
2. Term/Period an interval of time, which, exerting an influence on
an influence on an obligation as a consequence of a juridical act,
either suspends its demandability or produces its extinguishment.
Characteristics:
Future
Certain although not known when it will happen
**Suspensive Condition and Term Happening of which will arise to
acquisition of rights
**Resolutory Condition and Term Happening of which will result to
the extinguishment of an obligation

Example: I will give you P50,000 if you could prove that Rizal
returned to the Catholic Church before he died.
Classification of Conditions:
1. Suspensive or Resolutory
Suspensive when the fulfillment of the condition results in
the acquisition of rights arising out of the obligations.
Resolutory when the fulfillment of the condition results in
the extinguishment of rights arising out of the obligation.
2. Potestative, Casual, or Mixed
Potestative when the fulfillment of the condition depends
upon the will of a party to the obligation.
Casual when the fulfillment of the condition depends
upon chance and/or upon the will of a third person
Mixed when the fulfillment of the condition depends partly
upon the will of a party to the obligation and partly upon
chance and/or will of a third person
3. Possible or Impossible
Possible when the condition is capable of realization
according to nature, law, public policy or good customs
Impossible when the condition is not capable of
realization according to nature, law, public policy or good
customs
4. Positive or Negative
Positive when the condition involves the performance of
an act
Negative when the condition involves the omission of an
act.
5. Divisible or Indivisible
Divisible when the condition is susceptible of partial
realization
Indivisible when the condition is not susceptible of partial
realization
6. Conjunctive or Alternative
Conjunctive when there are several conditions, all of
which must be realized
Alternative when there are several conditions, but only
one must be realized
7. Express or Implied
Express when the condition is stated expressly
Implied when the condition is tacit
Art. 1180. When the debtor binds himself to pay when his means
permit him to do so, the obligation shall be deemed to be one
with a period, subject to the provisions of Article 1197.

 Should the debtor bind himself to pay when his means

permit him to do so, the obligation is one with a period and
not subject to a condition
Since the duration of the period is left to the discretion of
the debtor, it is subject to 1197 or where the courts shall fix
the duration of the period by which he shall pay the
obligation. Thus in cases falling under this article, creditor
should file an action to fix a period for the payment of the
obligation.
Indications of a term or period:
When the debtor binds himself to pay
when his means permit him to do so
little by little
as soon as possible
from time to time
as soon as I have the money
in partial payment
when in the position to pay
Art. 1181. In conditional obligations, the acquisition of rights, as
well as the extinguishment or loss of those already acquired,
shall depend upon the happening of the event which constitutes
the condition.

fulfillment of the condition depends upon the sole will of the

debtor, the conditional obligation shall be void. If it depends
upon chance or upon the will of a third person, the obligation
shall take effect in conformity with the provisions of this Code.
2 kinds of Potestative:
simple potestative condition presupposes not only a
manifestation of will but also the realization of an external
act
e.g. if you sell your house; If I go to Madrid, I promise to sell you
my house.

purely potestative condition1 depends solely and

exclusively upon the will

e.g. if I like it or if I deem it proper; I promise to sell you my house

on such date if I deem it convenient.
Note:
Simple potestative condition approaches very well the nature of a
mixed condition. (Caguioa) Hence, it is valid.
Purely or strict potestative condition on the other hand destroys the
efficacy of the legal tie. Note that it is only when the potestative
condition depends exclusively upon the will of the debtor that the
conditional obligation is void. (Tolentino)
Simple potestative valid;
purely potestative (creditor) valid; purely potestative
(debtor) - void
a) Potestative on the part of the Creditor
- if the fulfillment of the condition is dependent upon the sole will of
the creditor the obligation is VALID

Suspensive
Condition precedent

Resolutory
Condition subsequent

Results in the acquisition of Results in the extinguishment of

rights arising out of the rights arising out of the
Potestative
Casual obligations Mixed
obligations
fulfillment
of the fulfillment
of the
fulfillment
of the condition
the
The happening
of the condition
The
happening of
obligation
depends
condition
depends
obligation
depends
gives birth to the obligation.
extinguishes obligation
upon the will of a upon chance/or upon the will of a party
effective
party not todemandable
the upon until
the willtheof immediately
a to the obligation
and and
happening of the
which demandable,
without
prejudice
obligations
thirdevent
person
partly upon
chance
constitutes the condition
to and/or
the will
happening
of the
of a third
resolutory
person. condition
If the condition is not
E f fulfilled,
f e c t s If the condition is not fulfilled,
no juridical tie is created.
juridical relation is consolidated.
dependent on the The
obligation The obligation and the
What is acquired
the What
is acquired
obligee
creditor:
and thebycondition
condition
shallby the
take
obligee in and
the shall
constitution
of in effect.
the constitution
of the
condition
take effect.
(valid
and
the obligation (valid
is only mereand
obligation
are rights that are
obligation,
enforceable)
hope
and
expectancy,
subject
to
threat or danger of
VALID
enforceable)
protected by law.
extinction.
dependent on the
debtor:
- condition and
Art.
obligation, VOID
1182.
(suspensive)
When
Exception:
the
- condition and
obligation, VOID
(resolutory)

Example: I will give you a car on the condition that you go to Baguio
on or before Dec 10, 1965.
b) Potestative on the part of the Debtor
i) Suspensive condition:
- If a suspensive condition is solely dependent upon the will of the
debtor, the obligation is VOID.
Example: Ill give you a diamond ring if I go to Tokyo this year.
ii) Resolutory condition:
-A condition which is both potestative and resolutory is VALID, even
though the fulfillment of the condition is dependent upon the will of
the debtor
Example: Ill give you a car until I return from Baguio.
Art. 1183. Impossible conditions, those contrary to good
customs or public policy and those prohibited by law shall
annul the obligation which depends upon them. If the obligation
is divisible, that part thereof which is not affected by the
impossible or unlawful condition shall be valid.
The condition not to do an impossible thing shall be
considered as not having been agreed upon.
1

Referred to by Caguioa as strict potestative

Possible conditions those which are valid and allowed by law;

proper conditions.
Impossible conditions contrary to good customs or public policy
or prohibited by law.
2 kinds:
1.
Physically impossible when the realization of the event
constituting the condition is incompatible with or contrary to nature.
2.
Juridically impossible when contrary to law, morals, good
customs, and public policy.
* Illicit conditions those which tend to restrain or fetter the exercise
of those rights or powers arising from the natural or civil liberties of
man
* Immoral conditions those which tend to compel a person to
execute an act contrary to good customs.
Note: In the case of illicit and immoral conditions, the illicit act
provided for in the contract must refer to that of one of the parties but
not where the illicit act is the act of a third person. The illicit character
of the act is not determined by the act or fact in itself, but by its
effects upon one of the parties.
Applicability:
The article applies only to contracts. It has no application to
gratuitous obligation (simple and remuneratory donations and
testamentary dispositions).
Effects:
1. Impossible condition on obligation to give/to do
(positive & suspensive)
obligation is annulled
Example: Ill give you P40,000 if you go to the moon this year.

Art. 1185. The condition that some event will not happen at a
determinate time shall render the obligation effective from the
moment the time indicated has elapsed, or if it has become
evident that the event cannot occur.
If no time has been fixed, the condition shall be
deemed fulfilled at such time as may have probably been
contemplated, bearing in mind the nature of the obligation.
Positive conditions those that depend on the fulfillment of an
event.
Negative conditions those which depend on the non-happening of
an event.
If the condition is positive (that an event should occur
within a determinate period, the obligation is extinguished
from the moment the period lapses or it has become
indubitable that the event will not take place.
Example: Ill give you a car if you marry X on or before Dec
10, 1992. My obligation to give the car is extinguished if on
Dec 11, 1992 X is still single or if before Dec 10, 1992 X
dies, because by then it is evident that you can no longer
marry X.
If the condition is negative (that some event would not
happen within a determinate time), the obligation becomes
effective from the moment the period lapses, or if it has
become evident that the event cannot occur.
Example: Ill give you my car if you do not marry X on or
before Dec 10, 1992. If on Dec 11, 1992 you have not
married X, you can demand delivery of the car. If X dies
before Dec 11, 1992 you can, on the death of X demand
delivery of the car without waiting for Dec 11, 1992,
because it is evident that you can no longer marry X.

2. Impossible condition on obligation not to do

obligation is void (deemed not having been agreed upon);
hence obligation remains valid & subsequent => becomes
pure and simple

Art. 1186. The condition shall be deemed fulfilled when the

obligor voluntarily prevents its fulfillment.

Example: D obliged himself to give C P40,000 if C does not go to the

moon this year.

Constructive Fulfillment of Conditions

If the debtor prevents the creditor from fulfilling the condition of the
obligation, the condition is deemed fulfilled and the obligation
demandable.

*Impossible condition imposed on gratuitous obligation:

condition is deemed not imposed; hence obligation is valid
and becomes pure and simple
Requisites for the nullity of an obligation with impossible
conditions:
1.
Conditions are positive and suspensive
2.
Obligation is a contract
3.
Impossibility exists at the time of the creation of the
obligation
Art. 1184. The condition that some event happen at a
determinate time shall extinguish the obligation as soon as the
time expires or if it has become indubitable that the event will
not take place.

It is essential that the obligor must have actually prevented the

obligee from complying and that it must have been voluntary and
willful.
Requisites:
1. Condition is suspensive
2. Debtor actually prevents the fulfillment of the condition
3. He acts voluntary/intention
Example: Dean Ulan will give Anjo P50,000 if Dean Ulan and Dean
Jara will run around the campus. If only Dean Jara only ran, Art 1186
will apply UNLESS if it was not Dean Ulans intention and fault not to
run.

*Underlying principle: A party to a contract may not be excused from

performing his promise by the non-occurrence of an event which he
himself prevented.
Exception:

If in preventing the fulfillment of the condition the debtor

acts pursuant to a right, the condition will NOT be deemed fulfilled.
Applicable to:

Suspensive and potestative (creditor)

Suspensive and casual

Suspensive and mixed

ART.1187. The effects of a conditional obligation to give, once
the condition has been fulfilled, shall retroact to the day of the
constitution of the obligation. Nevertheless, when the obligation
imposes reciprocal prestations upon the parties, the fruits and
interests during the pendency of the condition shall be deemed
to have been mutually recompensated. If the obligation is
unilateral, the debtor shall appropriate the fruits and interests
received, unless from the nature and circumstances of the
obligation it should be inferred that the intention of the person
constituting the same was different.
In obligations to do and not to do, the courts shall
determine , in each case, the retroactive effect of the condition
that has been complied with.
Retroactive effects of fulfillment of suspensive condition
(1)
In obligations to give- An obligation to give subject to a
suspensive condition becomes demandable only upon the fulfillment
of the condition. However, once the condition is fulfilled, its effects
shall retroact to the day when the obligation was constituted.
When is an obligation constituted?
When the essential elements which give rise thereto concur.
Condition is not an essential element; it is only an accidental element
of the obligation.
The reason is because the condition is only accidental element of a
contract. An obligation can exist without being subject to a condition.
Consequently, once the event which constitutes the condition is
fulfilled thus resulting in the effectivity of the obligation, its effects
must logically retroact to the moment when the essential elements
which gave birth to the obligation have taken place and not to the
moment when the accidental element was fulfilled.
*Note:applicable only to consensual contracts (perfected upon
meeting of the minds) and not to real contracts(perfected by delivery)
(2)
In obligations to do or not to do- No definite rule. The courts
are empowered by the use of sound discretion and bearing in mind
the intent of the parties, to determine in each case, the retroactive
effect of the suspensive condition that has been complied with. It
includes the power to decide that the fulfillment of the condition shall
have no retroactive effect or from what date such retroactive effect
shall take effect.
Retroactive effects as to fruits and interests in obligations to
give

In reciprocal obligations-No retroactivity since the fruits and

interests are deemed to have been mutually compensated.

Example: On Jan 10, 1992 D obliged himself to give C a certain

ricefield and C agreed to give D a certain fishpond provided X passes
the CPA examinations. If X passes the CPA exam on Aug 10, 1992, C
is obliged to deliver the fishpond to D and D is obliged to deliver the
ricefield to C. However D is not obliged to deliver the fruit of the
ricefield to C. Neither is C required to give the fruits of the fishpond to
D.

In unilateral obligations- There is usually no retroactive

effect because they are gratuitous. The debtor receives nothing from
the creditor. Thus, fruits and interests belong to the debtor unless
from the nature and other circumstances of the obligation it should be
inferred that the intention of the person constituting the same was
different.
Example: On Jan 10, 1992 D obliged himself to give C a certain
ricefield provided C passes the CPA exams. If on Aug 10, 1992 C
passes the CPA exams, D obliged to deliver the ricefield to C but not
the fruits received from Jan 10, 1992

Exceptions to the rule of retroactivity:

1.
Real contracts
2.
Successive contracts (those contracts whose fulfillment is
realized within a period of time; e.g. contract of lease, contract of
labor, life annuities)
Reason for retroactivity: The condition is only accidental, not
essential element of the obligation.
Limitation of Retroactivity Effect:
If thing is lost through fortuitous event, debtor suffers the
loss because he is still the rightful owner. (basis: Art. 1164
-- ownership or personal right is only vested upon delivery)
Art.1188. The creditor may, before the fulfillment of the
condition, bring the appropriate actions for the preservation of
his right.
The debtor may recover what during the same time he
has paid by mistake in case of a suspensive condition.
Rights pending fulfillment of suspensive condition
(1) Rights of creditor- He may take or bring appropriate actions
for the preservation of his right, as the debtor may render
nugatory the obligation upon the happening of the condition.
Action for prohibition restraining the alienation of
the thing pending the happening of the
suspensive condition;
Action to demand security if the debtor has
become insolvent;
Action to set aside alienations made by the
debtor in fraud of creditors;
Actions against adeverse possessors to interrupt
the running prescriptive period;
To have the rights annotated in the registry.
(2) Rights of the debtor- He is entitled to recover what he has
paid by mistake prior to the happening of the suspensive
condition.

Art. 1188, par. 1- Protection for the creditor

file an injunction to stop the debtor

does not necessarily always involves court action in spite

the wordings of the law.
i.e. registration

LOSSES

Art. 1188, par. 2- protection for the debtor

Obligation
subject
to Obligation
suspensive condition
period/term

Loss without debtors fault

The debtors obligation is extinguished if the thing is lost without
his fault
Loss due to debtors fault
The debtors is obliged to pay damages if the thing is lost due
to his fault

subject

There is no certainty if the It is certain

obligation will be fulfilled
obligation will
demandable
enforceable.

to

that the
be fully
and

Interests and fruits shall also Interests and fruits shall also
be delivered when the debtor be delivered when the
paid/delivered by mistake.
debtor paid/delivered by
mistake.
Art. 1189. When the conditions have been imposed with the
intention of suspending the efficacy of an obligation
improvement, loss or deterioration of the thing during the
pendency of the condition:
(1) If the thing is lost without the fault of the debtor, the
obligation shall be extinguished;
(2) If the thing is lost through the fault of the debtor, he
shall be obliged to pay damages; it is understood that
the thing is lost 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) When the thing deteriorates without fault of the debtor,
the impairment is to be borne by the creditor.
(4) If it deteriorates through the fault of the debtor, the
creditor may choose between the rescission of the
obligation and its fulfillment, with indemnity for
damages in either case;
(5) If the thing is improved by its nature, or by time, the
improvement shall inure to the benefit of the creditor;
(6) If the thing is improved at the expense of the debtor, he
shall have no right that that granted to the
usufructuary.
Requisites:
(1)
The obligation is a real obligation (to give);
(2)
The object is a specific or determinate thing;
(3)
The obligation is subject to a suspensive condition
(resolutory is also applicable accdg to ULAN)
(4)
The condition is fulfilled; and
(5)
There is loss, deterioration, or improvement of the thing
during the pendency of the condition
Application: The loss, deterioration or improvement should take
place after the obligation is perfected and before the condition is
fulfilled.

When is a thing lost?

a) When it perishes
b) When it goes out of commerce
c) When it disappears in such a way that its existence is unknown or
it cannot be recovered.

DETERIORATION
What is deterioration?
A thing deteriorates when its value is reduced or impaired without the
fault of the debtor
Without debtors fault
Impairment to be borne by the creditor
With debtors fault
Obligation is converted into one of indemnity for damages
The creditor can choose between:
a) Rescission plus damages, or
b) Fulfillment of the obligation plus damages
IMPROVEMENT
What is improvement?
- A thing is improved when its value is increased or enhanced by
nature or by time
a) By nature or by time
- shall inure to the benefit of the creditor
b) At the debtors expense
- debtor shall have no other right than that granted to a usurfructory
Art. 1190. When the conditions have for their purpose the
extinguishment of an obligation to give, the parties, upon the
fulfillment of said conditions, shall return to each other what
they have received.
In case of the loss, deterioration or improvement of the
thing, the provisions which, with respect to the debtor, are laid
down in the preceding article shall be applied to the party who
is bound to return.
As for obligations to do and not to do, the provisions
of the second paragraph of Article 1187 shall be observed as
regards the effect of the extinguishment of the obligation.
Effect of Resolutory Obligation BEFORE fulfillment
Obligor/debtor has hope or expectancy during the
pendency of the condition
If resolutory condition happens, debtor will reacquire
whatever he may have paid or delivered to the
obligee/creditor

incurred was not willful or could be excused in view of the

surrounding circumstances.

Example: Ill give you a car until you should pass the CPA exams.
Effect of Resolutory Obligation AFTER fulfillment
If resolutory condition is not fulfilled, such rights are
consolidated absolute

(3) Right of third person (par 4)- If the thing subject matter of
the obligation is in the hands of a third person who acted in
good faith, rescission is not available as a remedy

Retroactivity of Effect
Effect of signifying the non-existence of the obligation and
what is non-existent must not give rise to any effect
whatsoever
Return to each other what they have received
Right to demand reimbursement for all expenses which he
may have incurred in the production, gathering, and
preservation of the said fruits.

(4) Substantial violation- The general rule is that rescission will

not be granted for slight breaches of contract; the violation
should be substantial as to defeat the object of the parties
in making the agreement.

Art. 1191. The power to rescind obligations is implied in

reciprocal ones, in case one of the obligors should not comply
with what is incumbent upon him.
The injured party may choose between the fulfillment
and the rescission of the obligation, with the payment of
damages in either case. He may also seek rescission, even after
he has chosen fulfillment, if the latter should become
impossible.
The court shall decree the rescission claimed, unless
there be just cause authorizing the fixing of a period.
This is understood to be without prejudice to the rights
of third persons who have acquired the thing, in accordance
with articles 1385 and 1388 and the Mortgage Law.
Reciprocal Obligations
are those which arise from the same cause and in which each
party is a debtor and creditor of the other, such that the
performance of one is designed to be the equivalent and the
condition for the performance of the other
Effect: When an obligation has been rescinded or resolved, it is
the duty of the court to require the parties to surrender whatever
may have received from the other; in other words, the parties
must be placed as far as practicable in their original situation.
Tacit Resolutory Condition (Par.1)
Principle: If one of the parties fails to comply with what is imcumbent
upon him, there is a right on the part of the other to rescind or
resolve the obligation.
Remedies:
(1) Action for specific performance (fulfillment) of the obligation
with damages; or
(2) Action for rescission of the obligation also with damages.
*Should be invoked judicially (par 3) except when
stipulated in the contract
Limitations on right to demand rescission:
(1) Resort to the courts- The injured party has to resort to the
courts to assert his rights judicially
(2) Power of court to fix period- The court has discretionary
power to allow a period within which a person in default
may be permitted to perform his obligation if there is a just
cause for giving time to the debtor, as where the default

(5) Waiver of right- The right to rescind may be waived,

expressly or impliedly.
*Note: Where the contract itself contains stipulations regarding
automatic rescission without judicial interbention upon violation of the
terms of the contract, the right to rescind is not implied but expressly
stated then judicial permission to cancel or rescind the contract is no
longer necessary. The injured party should give notice to the other
party of the rescission and his chosen remedy.
Art. 1192. In case both the parties have committed a breach of
the obligation, the liability of the first infractor shall be equitably
tempered by the courts. If it cannot be determined which of the
parties first violated the contract, the same shall be deemed
extinguished, and each shall bear his own damages.
Rules:
1. the liability of the first infractor shall be equitably tempered by the
courts.
fair to both parties because the second infractor also
derived, or thought he would derive, some advantage for
his own act or
neglect
2. If it cannot be determined which of the parties first violated the
contract, the same shall be deemed extinguished, and each shall
bear his own damages
it is presumed that both at about the same time tried to
reap some benefit

Term/Period

Condition

Interval of time which

is future and certain

requisites

Interval of time that

must
necessarily
come, although it may
not be known when

fulfillment

Merely exerts
influence upon
time
of
demandability
extinguishment of
obligation.

an
the
the
or
an

No retroactive effects
unless there is an
agreement to the
contrary.

Refers to a fact or
event which is future
and uncertain
A future and uncertain
fact or event that may
or may not happen.

Influence on Exerts an influence

obligation upon
the
very
existence
of
the
obligation itself.

Retroactive
effects

When a term or a Effect of will of

period
is
left
the debtor
exclusively to the will
of the debtor, the
existence
of
the
obligation
is
not
affected
(potestative term or
period)

Has retroactive effects

When a condition is
left on the exclusive
will of the debtor, the
existence
of
the
obligation is affected
(Void)
(potestative condition)

Sec. 2 Obligations with a Period

Art. 1193. Obligations for whose fulfillment a day certain has
been fixed, shall be demandable only when that day comes.
Obligations with a resolutory period take effect once,
but terminate upon arrival of the day certain.
A day certain is understood to be that which must
necessarily come, although it may not be known when.
If the uncertainty consists in whether the day will come
or not, the obligation is conditional, and it shall be regulated by
the rules of the preceding Section.
Term or Period- interval of time, which exerting an influence on an
obligation as a consequence of a juridical act, either suspends its
demandability or produces its extinguishment.
Obligations with a period- obligations whose
demandability or extinguishment is subject to the expiration of a term
or a period.
Requisites:

1. Future
2. Certain
3. Possible, legally and physically
A day certain understood to be that which must necessarily come,
although it may not be known when
Certainty of event may be either:
a) absolutely known (e.g.: May 23, 2010)
b) relatively known (e.g.: fixing a period several days after
May 23, 2010)
c) totally unknown (day when a person dies)
Classification of Term/Period
A. According to source
1. Voluntary/ conventional fixed by the will of the parties
2. Legal fixed by law
3. Judicial fixed by the courts
B. According to effect
1. Suspensive (ex die or dies a quo) when the obligation is
demandable only when the day comes
2. Resolutory (in diem or dies ad quem) when the obligation takes
effect at once but terminates upon the arrival of the day certain
C. According to definiteness
1. Definite when the period is fixed
2. Indefinite when the term or period is not fixed
D. According to expression
1. Express when the period is stipulated in the obligation
2. Tacit when from the nature or circumstances, it can be inferred
that a period was intended
E. According to nature
1. Ordinary that which would not prevent the obligation from being
fulfilled despite the lapse of the same in accordance with the rules
governing delay or mora.
2. Essential which requires that the obligation be performed
precisely and exclusively at the time stipulated without there being a
possibility of its being fulfilled
Effect of Term or Period
Suspensive demandable only upon the arrival of the day
certain or expiration of the term
Resolutory fulfillment is demandable at once but it is
extinguished or terminated upon the arrival of the day
certain or expiration of the term
Effect of Fortuitous Event
The stipulation that in the event of force majeure, the contract shall
be deemed suspended during the said period does not mean that the
happening of any of those events stops the running of the period the
contract agreed upon to run.
Art. 1194. In case of loss, deterioration or improvement of the
thing before the arrival of the day certain, the rules in article
1189 shall be observed.
This is only applicable to obligations to give a determinate thing

Art. 1195. Anything paid or delivered before the arrival of the

period, the obligor being unaware of the period or believing
that the obligation has become due and demandable, may be
recovered, with the fruits and interests.
Effect of Advance Payment or Delivery
-If obligor is unaware or believing that payment is due and
demandable, paid, or delivered something before the arrival of the
period, he may recover what he has paid or delivered with fruits and
interest.
-apply on to give
-If it is voluntary done or done with knowledge that it is not yet due,
there can be no right to recover.
-This is construed in relation to Solutio indebiti or payment of what
is not due.
- This pertains to the recovery of thing or money itself, plus the fruits
or interest accruing from the moment of payment to the date of
recovery
There is no recovery (Tolentino)
1. When the obligation is reciprocal, and there has been premature
performance on both sides
2. When the obligation is a loan on which the debtor bound to pay
interest
3. When the period is exclusively for the benefit of the creditor,
because the debtor by paying in advance loses nothing
Art. 1196. Whenever in an obligation a period is designated, it is
presumed to have been established for the benefit of both the
creditor and the debtor, unless from the tenor of the same or
other circumstances it should appear that the period has been
established in favor of one of the other.
Benefit of Term or Period
General Rule: When a period is designated for the performance or
fulfillment of an obligation, it is presumed to have been established for
the benefit of both the creditor and the doctor. Presumption
Exception: If it be proved that either from the tenor of the obligation or
from other circumstances that term has been established in favor of
the creditor of the debtor
Term is for the benefit of both parties (Presumption)
The creditor cannot demand payment and the debtor cannot make an
effective tender and consignation of payment before the period
stipulated.
Term is for benefit of creditor only (Exception)
- Creditor may demand payment anytime, but the debtor cannot
compel him to accept payment before the period expires (e.g.:
contract of loan where interest is stipulated)
- Right to refuse any payment before the expiration of the term could
be waived by acceptance of full or partial payment
Term is for benefit of debtor only (Exception)
Debtor may oppose premature demand for payment, but may validly
pay at any time before the period expires (e.g. contract of loan where
no interest is stipulated)
Why a creditor cannot be compelled to accept payment
1.
Tax avoidance

2.
Interest income
3.
Safe investment (e.g. Protection against the sudden decline in
the purchasing power of the currency loaned)
Art. 1197. If the obligation does not fix a period, but from its
nature and the circumstances it can be inferred that a period was
intended, the courts may fix the duration thereof.
The courts shall also fix the duration of the period when it
depends upon the will of the debtor.
In every case, the courts shall determine such period as may
under the circumstances have been probably contemplated by
the parties. Once fixed by the courts, the period cannot be
changed by them
Judicial term or period - when fixed by a competent court, the period
can no longer be judicially changed (Art. 1197, par. 3). It becomes a
law governing the contract between the party.
General Rule: Courts are without power to fix period
Exceptions: When the Court may fix a period
1. When the obligation does not fix a period, but from its nature and
the circumstances it can be inferred that a period was intended by
the parties
2. If the duration of the period depends upon the will of the debtor
3. If the debtor binds himself to pay when his means permit him to
do so period.
Cannot be applied to:
Contracts for services in which no period was fixed by the
parties
Pure obligations
Steps/Nature of the Action
1. Ask the court to fix the duration of the term or period
2. If time elapsed, compel.
Effect of Term
Once the period has been fixed by the court, it becomes part of the
contract, and it cannot be subsequently changed or extended by the
court without the consent of both the parties.
Two Ultimate Facts:
1. Facts showing that a contract was entered into imposing on one of
the parties an obligation in favor of the other
2. Facts showing that the performance of the obligation was left to
the will of the obligor, or clearly showing or from which an inference
can be reasonably drawn that a period was intended.
Art. 1198. The debtor shall lose every right to make use of the
period: [IGIVA]
(1) When after the obligation has been contracted, he
becomes insolvent, unless he gives a guarantee or
security for the debt;
(2) When he does not furnish to the creditor the
guaranties and securities which he has promised;
(3) When by his own acts he has impaired said guaranties
and securities after their establishment, and when

through a fortuitous event they disappear2, unless he

immediately gives new ones equally satisfactory;
(4) When the debtor violates any undertaking, in
consideration of which the creditor agreed to the
period;
(5) When the debtor attempts to abscond.
Extinguishment of debtors Right to Period
(1)
When after the obligation has been contracted, he
becomes insolvent, unless he gives a guaranty or security for the
debt;
insolvency needs no judicial declaration
includes any case in which it would be impossible financially for
the debtor to comply with his obligations
such insolvency must not be pre-existing; arose after the
constitution of the obligation
if there is a guaranty or security for the debt, the debtor, in spite
of insolvency, does not lose his right to the period.
(2)
When he does not furnish to the creditor the guaranties or
securities which he has promised;
such failure renders the original obligation pure and without
any condition, and consequently, the loan become due and
demandable.
(3)
When by his own acts he has impaired said guaranties or
securities after their establishment, and when through a fortuitous
event they disappear, unless he immediately gives new ones equally
satisfactory;
There is a difference between effects of impairment and effects of
disappearance
1.
if the guaranty or security is impaired through the fault of
the debtor, he shall lose his right to the benefit of the period;
2.
if it is impaired without his fault, he shall retain his right;
3.
if the guaranty or security disappears through any cause,
even without the fault of the debtor, he shall lose his right to the
benefit of the period
4.
in either case of impairment or disappearance, the debtor
will not lose his right to period if he gives a new guaranty or security
which is equally satisfactory.
(4)
When the debtor violates any undertaking, in consideration
of which the creditor agreed to the period;
(5)

When the debtor attempts to abscond.

Mere attempt of the debtor disappear or run away from his
obligation.

Section 3 Alternative and Facultative Obligations

Art. 1199. A person alternatively bound by different prestations
shall completely perform one of them. The creditor cannot be
2

Not grammatical or ordinary meaning but sense of loss as

defined by law (Tolentino)

compelled to receive part of one and part of the other

undertaking. (1131)
Classification (CDAF)
1. Conjunctive all prestations must be performed to extinguish
obligation
2. Disjunctive one or some prestations must be performed to
extinguish obligation
3. Alternative debtor must perform one of several alternatives,
choice belongs to debtor UNLESS expressly given to creditor
4. Facultative one principal prestation but one or more
substitutes, choice belongs to DEBTOR ONLY
*Absent the indication that it is facultative, the presumption is
that it is ALTERNATIVE because creditor would be at a
disadvantage if the obligation is facultative. Facultative is never
presumed.
Art. 1200. The right of choice belongs to the debtor, unless it
has been expressly granted to the creditor.
The debtor shall have no right to choose those prestations
which are impossible, unlawful or which could not have been
the object of the obligation. (1132)
Concept:
Alternative Obligation - obligation wherein various things are due,
but the payment of one of them is sufficient, determined by the
choice which as a general rule belongs to the debtor (Luna)
Election by Debtor

In alternative obligations, the debtor has the right to choose

the method of meeting the obligation, unless the creditor has
expressly reserved that right to himself.
Election by Others

The right to choose may be granted to the creditor.

The choice may also be entrusted by the parties to a third

person.
- Although this has not been expressly recognized, there is
no reason why it should not be allowed, since it is not contrary
to law, morals, good customs, public order or public policy.

The grant must be expressed, it cannot be implied.

Exceptions/ Limitations on the Right to Choose by the Debtor (IEx-IOU-OP-PFB)
1. The debtor cannot choose part of one and part of the other
undertaking.
a. The creditor cannot be compelled to receive part
of one and part of the other undertaking. [Article
1199, paragraph 2 in relation to Article 1248]
b. There is a presumption of indivisibility
2. He loses the right to choose when the right of choice is
expressly granted to the creditor.
c. The right of choice belongs to the debtor, unless
it has been expressly granted to the creditor.
[Article 1200]
3. The debtor shall have no right to choose those prestations
which are impossible, unlawful or which could not have
been the object of the obligation. [Article 1200, paragraph

2]
d.

The presence of such undertaking does not

annul the obligation, it as an alternative one if
there are other lawful and possible subjects.
e. Prestations which could not have been the
objects of the obligation refers to:

prestations which turn out to be

different from what the parties supposed and
which do not serve the purpose for which the
obligation was contracted;

prestations which are not yet due and

demandable;

prestations which, by reason of

accident or some other cause, have acquired
a new character distinct or different from that
contemplated by the parties when the
obligation was constituted.
4. The debtor shall lose the right of choice when among the
prestations whereby he is alternatively bound, only one is
practicable. [Article 1202]
f. Applies to specific things only
g. The obligation ceases to be alternative, and is
converted into a simple obligation to perform the
only practicable prestation.
h. The impossibility of the other prestations,
however, must not be due to the creditors acts.
For in such case article 1203 applies.
i. This article applies only when debtor has the
right to choose.
j. In cases where creditor is granted the right to
choose, article 1205 will apply.
5. The debtor loses the right to choose if the period is fixed
solely for the benefit of the creditor and that period has not
arrived yet. (According to Sir Ulan )
k. Whenever in an obligation a period is
designated, it is presumed to have been
established for the benefit of both the creditor
and the debtor, unless from the tenor of the
same or other circumstances it should appear
that the period has been established in favor of
one or of the other. [Article 1196]
Art. 1201. The choice shall produce no effect except from the
time it has been communicated. (1133)
Notice of Selection or Choice (OWUT) Maybe in any form provided it is sufficient to make the other
party know that the election has been made. It is not subject to
any form and may be made:
1. orally;
2. in writing;
3. tacitly;
4. other unequivocal means
Tacit declaration may be seen (PAS):
1. in the performance of the debtor who has the right to
choose;
2. in the acceptance of a prestation by a creditor when he has
the right of selection; or
3. when the creditor sues for the performance of the
prestation.

N.B.
1. When the debtor, to whom the right of choice pertains,
performs one of the prestations with the intent to discharge the
obligation, he is released because the selection made may be
implied in the fact of
performance.
2. Once the choice is made by the debtor (or by the creditor or
by a third person as the case may be), the obligation ceases to
be alternative from the moment the selection has been
communicated to the other party. From that moment, both
debtor and creditor are bound by the selection.
3. A selection once made is binding on the person who makes it,
and he will not therefore be permitted to renounce his choice
and take an alternative which was first opened to him.
Creditors Consent

The law does not require the other party to consent to the
choice made by the party entitled to choose.

A mere declaration of the choice, communicated to the

other party, is sufficient; it is a unilateral declaration of will.
Plurality of Subjects

When there are various debtors or creditors, and the

obligation is joint, the consent of all is necessary to make the
selection effective, because none of them can extinguish the
entre obligation.

If the obligation is solidary, and there is no stipulation to the

contrary, the choice by one will be binding personally upon him,
but not as to the others.
Condition or Term

The selection made by one party cannot be subjected by

him to a condition or term unless the other party consents
thereto.
When Choice is Effective
The choice made by the debtor shall produce legal effect only
from the time it is communicated to the creditor. Once the choice is
communicated to the creditor, the debtor will no longer be permitted
to renounce his choice and take an alternative whcih was first open
to him (Reyes vs. Martinez, 55 Phil. 492).
N.B.
1. choice is made by the:
a. debtor - debtor shall communicate the choice to the creditor
(D ----> C)
b. creditor - creditor shall communicate the choice to the debtor
(C ----> D)
c. third person - third person shall communicate the choice to
both the debtor and the creditor (T ---> D and C)
2. The making of a choice is NOT a right, but a DUTY. (Jurado)
Effect of Choice (LCI)

The effect of notice of choice is to limit the obligation to the

object or prestation selected, with all the consequences which
the law provides.

The obligation is converted to a simple obligation to

perform the prestation chosen.

Once the selection has been communicated, it becomes

irrevocable.
Rationale: To allow a change in the selection after it has been
communicated to the other party, is to expose the latter to
damages arising from preparations he may make on the

assumption that the prestation selected is the one to be

performed
Error as to the Obligation
When the debtor performs one of the prestations, believing
that he has a simple obligation (an ignorance of the
alternatives and on his right to choose), there is no
declaration of the selection, nor a binding performance of
the obligation. There is payment of what is not due, and the
debtor can recover the se, in accordance with the
provisions of the law on Quasi-Contracts.
Delay in the Making of Choice
Who will make a selection when the entitled party to choose
delays in making his selection?
The German Doctrine stated that the right to choose
passes automatically to the other party when there is delay
on the part of the party entitled to choose. (according to
Tolentino, this is acceptable under our law)
Can the creditor enforce the obligation if the debtor has not yet
made his choice?
It is the debtors duty to select at the time when the
performance should be effected. If he does not do so, the
creditor cannot enforce the obligation. However, the choice
can be made by him (creditor) by applying the principle of
Article 1167 on obligations to do.
When the obligation consists of not doing, and
the obligor does what has been forbidden him, it
shall be undone at his expense. [Article 1167]
The debtor in such case should be deemed to have
waived his right to choose in favor of the creditor who may
exercise such right.
Article 1202. The debtor shall lose the right of choice when
among the prestations whereby he is alternatively bound, only
one is practicable.
Obligation Becomes Simple
Debtor cannot choose impossible or unlawful prestations. If
all the prestations, except one, are impossible or unlawful, it follows
that the debtor can choose and perform only that one. The obligation
ceases to be alternative, and is converted into a simple obligation to
perform the only feasible or practicable prestation. Impossibility of the
prestations must not be due to the creditor's acts, for in such case,
Article 1203 shall apply. (Tolentino)
According to Luna, alternative obligation is converted into a
simple obligation when (Cc-Cd-Op):
a. when the choice is made by the debtor is communicated to the
creditor (8 Manresa 181)
b. when the choice has been given to the creditor and the latter's
choice is communicated to the debtor (Article 1205)
c. when among the prestations whereby the debtor is alternatively
bound, only one Is practicable (Article 1202)
Where Creditor may Choose
The article applies only when the debtor has the right to

choose. When the creditor is granted the right to choose, Article 1205
will apply when only one prestation remains practicable, either
through fortuitous event or due to the fault of the debtor.
Art. 1203. If through the creditor's acts the debtor cannot make a
choice according to the terms of the obligation, the latter may
rescind the contract with damages.
Impossibility Due to the Creditor
This article is based on the principles of justice.
If through the creditors act the debtor cannot make a choice,
he may (RPR):
rescind the contract with damages
elect to perform that which remains if there is only one
prestation possible (Tolentino)
elect those still remaining if several are still possible
(Tolentino)
Reason for 2nd and 3rd: The rescission does not take place
automatically but at his option.
Example
1. A contractor, for the consideration of P50,000, agreed to either
build a house for X on the latter's residential lot, or construct a road
to his hacienda. X sells his residencial lot. Because of the
impossibility of the prestation to build the house, the contractor may
either construct the road to the hacienda, or rescind the contract; in
the latter case, he may recoveras damages whatever profits he could
have realized if he had constructed the house and received the
consideration of P50,000.
2. D obliged himself to paint the house of C or to paint C's car. If
before the due date of the obligation, C sells his car, D can rescind
the obligation plus damages.
Art. 1204. The creditor shall have a right to indemnity for
damages when, through the fault of the debtor, all the things
which are alternatively the object of the obligation have been
lost, or the compliance of the obligation has become
impossible.
The indemnity shall be fixed taking as a basis the value of the
last thing which disappeared, or that of the service which last
became impossible.
Damages other than the value of the last thing or service may
also be awarded. (1135a)
Effect of Loss of Object
This article applies to cases in which the debtor has the right to
choose (this is the General Rule). Article 1205 is applicable only
when the right of choice belongs to creditor (exception).
Loss by Fault of the Debtor
He (debtor) will become liable for damages under the terms of this
article only when all the prestations become impossible through
his fault.
a. Loss of all - The debtor shall pay the value of the thing lost, plus
damages. However, if all the things disappear at the same time,
the debtor may choose the value of any of them, plus damages.

(Luna)
b. Loss of some - The debtor may, without incurring any liability to
pay damages, deliver any of the remainder, or that which
remains if only one subsists. (Luna)
Effect of Fortuitous Event
a. If all the prestations become impossible - the obligation is
extinguished, the debtor is not liable for damages
b. If one of the things is lost or one of the prestations cannot be
performed - the debtor must still comply with the obligation by
delivering or performing that which he shall choose from
among the remainder
c. If all the things are lost except one - the debtor must still
comply with delivering or performing that which remains
d. If one or more prestations due become impossible, leaving only
one prestation which becomes impossible by fault of the
debtor - debtor will be liable for damages, with the value of
the last prestation as the basis.
Loss of some due to debtor's fault and the last thing due to
fortuitous event
a. If some of the prestations become impossible by fault of debtor,
and then the remaining prestation become impossible by
fortuitous event - the debtor is liable under this article, but the
basis of the damages will be the value of the last prestation
which become impossible through the debtors fault.
N.B. From and after the loss except one of the various things,
whether due to fortuitous event or the debtor's fault, the debtor
shall lose the right of choice (Article 1202) and the obligation
converted into a simple obligation. Hence, the loss of the last
subsisting prestation due to a fortuitous event extinguishes the
obligation. (Luna)
Example: D obliged himslef to give C a specific ring or a specific
watch, or a specific radio.
a. the ring, watch or radio are all lost due to fire and without the
fault of D = obligation is extinguish
b. the ring, watch and radio are lost in that order due to the fault of
D = D is obliged to pay the value of the radio plus damages
Art. 1205. When the choice has been expressly given to the
creditor, the obligation shall cease to be alternative from the day
when the selection has been communicated to the debtor.
Until then the responsibility of the debtor shall be governed by
the following rules:
(1) If one of the things is lost through a fortuitous event, he
shall perform the obligation by delivering that which the
creditor should choose from among the remainder, or
that which remains if only one subsists;
(2) If the loss of one of the things occurs through the fault
of the debtor, the creditor may claim any of those
subsisting, or the price of that which, through the fault
of the former, has disappeared, with a right to damages;

(3) If all the things are lost through the fault of the debtor,
the choice by the creditor shall fall upon the price of
any one of them, also with indemnity for damages.
The same rules shall be applied to obligations to do or not to do
in case one, some or all of the prestations should become
impossible.
Selection by the Creditor
When the creditor has the right to choose, his selection
takes effect from the moment it is communicated to the debtor.
Selection can be express or tacit
There is tacit selection when the creditor accepts a
prestation offered by the debtor, or brings an action for the
enforcement of the prestations.
Effect of Creditors Delay
The debtor will not incur delay in the performance of the
obligation, even if there is a definite period fixed.
- Creditor is considered to have waived the period.

There will be delay on the part of the debtor only

when the obligation has become a simple one by
exercise of the creditor of his right to choose.
Creditor does not make his selection before the period fixed
- debtor's duty to perform does not arise because the
particular prestation to be performed has not been
determined
- creditor in such case must be considered in his own inaction
to have waived the period
Art. 1206. When only one prestation has been agreed upon, but
the obligor may render another in substitution, the obligation is
called facultative.
The loss or deterioration of the thing intended as a substitute,
through the negligence of the obligor, does not render him
liable. But once the substitution has been made, the obligor is
liable for the loss of the substitute on account of his delay,
negligence or fraud. (n)
Distinguished From Facultative
AS TO
Contents of
the
obligation

As to
compliance
Nullity of
prestation

ALTERNATIVE
There are various
prestations all of which
constitute parts of the
obligation
May be complied with by
the delivery of one of the
objects or by the
performance of one of the
prestations which are
alternatively due
The nullity of one
prestation does not
invalidate the obligation
which is still in force with
respect to those which
have no vice.

FACULTATIVE
Only the principal constitutes
the obligation , the accessory
being only a means to
facilitate payment
May be complied with by the
delivery of another object or
by the performance of
another prestation in
substitution to that which is
due.\
The nullity of the principal
prestation (i.e. when the
object is unlawful or outside
the commerce of man)
invalidates the obligation.

Creditor can choose from

the remainder
The right to choose may
be given to the creditor

Choice

Effect of
Loss
(fortuitous
event)

Only the IMPOSSIBILITY

OF ALL the prestations
due without fault of the
debtor extinguishes the
obligation
The debtor is not liable if
other prestations are still
available.

Effect of
Loss
(through
fault)

If choice belongs to
creditor, loss of one
alternative gives rise to
liability.

Creditor cannot demand the

substitute even when this is
valid.
Only the debtor can choose
the substitute prestation
Impossibility of the principal
prestation is sufficient to
extinguish the obligation,
even if the substitute is
possible.
Loss of substitute does not
make debtor liable, unless
substitution has been made
The debtor is liable
Loss of the substitute before
substation does not render
debtor liable

Nature of Facultative Obligation

Defined as an obligation wherein only one object or prestation
has been agreed upon by the parties of the obligation, but
which may be complied with by delivery of another prestation
in substitution.

Characteristic feature- only one prestation is due,

- But if the obligor fails to deliver such object or to
perform such prestation, he can still comply with this
obligation by delivering another object or performing another
prestation in substitution.
Example: D obliged himself to give C a specific Rolex watch
with the understanding that D could give his diamond ring as a
substitute.
Loss of the Principal Thing
Due to fortuitous event - the obligation is extinguished and the
debtor is not obliged to give the substitute
Due to the debtor's fault - the debtor shall answer for the loss
of the thing due to his fault
Loss of Substitute
Before the substitution is effected, it is not the prestation that
is due; only the principal prestation is due and enforceable by
the creditor at that time.
- whether due to fortuitous event of fault of the debtor:
does not affect the debtor's liability to deliver the
principal thing (Luna)
-If the substitute prestation becomes impossible due
to the fault or negligence of the debtor, the obligation
is not affected and he cannot be held liable for
damages. (Tolentino)
- Whatever may be the cause of impossibility of the
substitute prestation is immaterial.

After the substitution

a. due to fortuitous event - obligation is extinguished
b. due to the debtor's fault - debtor shall be liable for the
loss or deterioration of the substitute (on the account of his
delay, negligence or fraud)

Simple Obligation
a. concept - A simple obligation is anobligation where only one
prestation has been agreed upon (Luna)
b. example - D obliged himslef to give C a specific car on
October 4, 1976.
Compound or Conuctive Obligation
a. concept - A compound or conuctive obligation is an obligation
wherein various things are due and is extinguished only by the
performance of all of them (Luna)
b. example - D obliged himself to give C on Oct. 4, 1976 a radio
and a piano. To be able to extinguish his obligation D is obliged
to give C on Oct. 4, 1976 both the radio and the piano.
When Substitution Takes Effect
The rule with respect to alternative obligations can be applied
by analogy; that is, from the time the debtor communicates to
the creditor that he elects to perform the substitute prestation.
- From this moment, the substitute prestation is the only
one that is due.
If the principal prestation thereafter becomes impossible,
even by fortuitous event, the debtor would not be relieved but
would still be obliged to perform the substitute prestation that
he has chosen.
- His obligation has become a simple one to perform the
substitute prestation, and he will be liable for damages
for his delay, neglect or bad faith in the performance.
Section 4 Joint and Solidary Obligations
Art. 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. (1137a)
Joint Obligation (mancomunada simple/ pro rata)
- one in which each of the debtors is liable only for a proportionate
part of the debt, and each debtor is entitled to only a
proportionate part of the credit
*example: A, B, and C jointly executed a promissory note worded as
follows:
"We promise to pay to the order of X P9,000.
(Sgd.) A, B, and C."
-A is liable for P3,000, B for P3,000 and C for P3,000.
Solidary Obligation (mancomunada solidaria/ joint and several
or in solidum)
- one in which each debtor is liable for the entire obligation, and each
creditor is entitled to demand the whole obligation.
When Solidary Exists
General Rule: The mere concurrence of two or more creditors or
two or more debtors in one and the
same obligation does NOT
imply solidarity.
Kinds of Solidarity (APM)
a. Active - solidarity among creditors
*example: A obliged himself to pay P30,000 to solidary
creditors B, C, anf D. Each of the creditors is entitled to demand

payment of the whole P30,000. Thus, B, or C, or D can demand

payment of P30,000 from A.
b. Passive - solidarity among debtors
*example: A, B and C executed a promissory note worded
as follows:
"I promise to pay X or order the sum of P30,000.
(Sgd.) A, B, and C."
- X is entitled to demand payment to demand the payment of
P30,000 from A, or from B, or from C.
c. Mixed - solidarity on the part of the creditors and debtors
*example: A, B, and C executed a promissory note worded
as follows:
"We do hereby slidarily promise to pay to the order of solidary
creditors L, M, and N the sum of P30,000.
(Sgd.) A, B, and C
- L, or M, or N shall be entitled to demand payment of the whole
P30,000 from A, or from B or from
C.
Joint debtors - solidary creditors
*example: A and B executed a promissory note worded as follows:
"We promise to pay to solidary creditors C and D P10,000.
(Sgd.) A, B"
- C or D as solidary creditors shall be entitles to demand payment of
the whole P10,000 . But since t
he debtors are bound jointly,
C or D shall be entitled to demand payment of no more than P5,000
from
A and another P5,000 from B.
Solidary debtors - joint creditors
*example: A and B executed a promisory note worded as follows:
"We do hereby solidarily promise to pay to the order of C and D
P10,000.
(Sgd.) A, B"
- As solidary debtors, A or B may be compelled to pay the whole
P10,000. But since the creditors are bound jointly, C is entitled to
demand the payment of P5,000 from A, or B and D is entitled to
demand payment of the other P5,000 from A or B.
Art. 1208. If from the law, or the nature or the wording of the
obligations to which the preceding article refers the contrary
does not appear, the credit or debt shall be presumed to be
divided into as many shares as there are creditors or debtors,
the credits or debts being considered distinct from one another,
subject to the Rules of Court governing the multiplicity of suits.
(1138a)
Joint Obligation
a. The debt shall be divided into as many equal shares as there
are creditors or debtors, the credits on the debts being
considered disticnt from each other. (Luna)
b. In case of non-payment, only one action should be files in
court. (Luna)
Presumption of Joint Character
When two persons are liable under a contract or under
judgment, and no words appear in the contract or the judgment to
make each liable for the entire obligation, the presumption is that
their obligation is joint.
3 Exceptions to the presumption (ELN):
a. when the obligation expressly states that there is solidarity
b. when the law requires solidarity

c. when the nature of the obligation requires solidarity

Effect of Joint Liability
a. the demand by one creditor upon one debtor, produces the
effects of default only with respect to the creditor who
demanded and the debtor on whom the demand was made, but
not with respect to others.
b. the interruption of prescription by the judicial demand of one
creditor upon a debtor does not benefit the other creditors nor
interrupt the prescription as to the other debtors. Similarly,
partial payment or acknowledgment made by one of several
joint debtors does not stop the running of the statute of
limitations as to the others.
c. the vices of each obligation arising from personal defect of a
particular creditor or debtor does not affect the obligation or
rights of the others.
d. the insolvency of a debtor does not increase the responsibility
of his co-debtors, nor does it authorize a creditor to demand
anything from his co-creditors.
e. in Joint Divisible Obligation (JDO)
- the defense of res judicata is not extended from one
debtor to another.
- nature of the obligation is susceptible to partial fulfillment
(Dean Ulan)
- example: A and B jointly obliged themselves to give C the
sum of P60.00.
Art. 1209. If the division is impossible, the right of the creditors
may be prejudiced only by their collective acts, and the debt can
be enforced only by proceeding against all the debtors. If one of
the latter should be insolvent, the others shall not be liable for
his share. (1139)
Joint Indivisible Obligations (JIO)
- Several debtors and creditors, but the prestation is indivisible,
the obligation is joint, unless solidarity has been stipulated.
- preserves the two characteristics of the joint obligation, in that
no creditor can do an act prejudicial to others, and no debtor
can be made to answer for the others. However, its fulfillment
requires the concurrence of all the debtors although each for his
part. On the side of the creditors, collective action is expressly
required for acts which may be prejudicial.
- example: A and B jointly obliged themselves to give C a
specific cow.
Effects on Creditors (according to Luna)
a. To be able to compel performance of th eobligation, all the
creditors should act collectively. A demand by one or some but
less than all the creditors is not effective.
b. The right of the creditors may be prejudiced only by their
collective acts.
- all creditors renounce the obligation: extinguished
- renunciation made by one creditor w/o consent of the
other: only the share of the former is extinguished; other
creditors can no longer demand the delivery of the thing;
obligation is converted into an obligation to pay its value

Effects on Debtors (according to Luna)

a. The debt can be enforced only on proceedings against all the
creditors. A demand against one or some but less than all the
debtor/debtors against whom the demand has been made are
not obliged to deliver the thing.
b. extinguish the obligation - payment should be made to all the
creditors
c. if any of the debtors is insolvent - the other shall not be liable
for his share
d. any of the debtors refuses to deliver the thing - obligation is
converted into an obligation to pay the value of the thing
the value of the thing shall be shared by all debtors
whole damages shall be borne by the debtor who
does not comply with this undertaking
Effect of breach - if one of the joint debtors fails to comply with his
undertaking the obligation can no longer be fulfilled or performed.
The obligation now is converted into one of indemnity for damages.
Effect of insolvency of a debtor - if one of the joint debtors shall be
insolvent, the others shall not be liable for his share.
N.B. Absence of stipulation of how much is the actual share of the
debtors, the presumption is equal. (Dean Ulan)
Art. 1210. The indivisibility of an obligation does not necessarily
give rise to solidarity. Nor does solidarity of itself imply
indivisibility. (n)
As to nature

Indivisibility
Prestation which
constitutes the object
of the obligation

As to requisites

Plurality of subjects is
not required

As to effect of
breach

When the obligation

is converted into one
of indemnity for
damages because of
the breach,
indivisibility of the
obligation is
terminated

Solidarity
Legal tie or
vinculum to the
subjects of the
obligation
Plurality of
subjects is
indispensable
When there is
liability on the part
of the debtors
because of
breach, the
solidarity among
the debtors
remains

N.B. 1. according to Luna:

a. solidarity does NOT imply indivisibility (An obligation
may be divisible even if it is solidum)
b. indivisibility does NOT imply solidarity (mere fact that
the object of the obligation is not susceptible of partial
performance does not mean that each of the debtor is
liable for the entire obligation.)
c. example of:
solidary divisible obligation: A and B solidarily
obliged themselves to give C P50,000 on March 15,
2011 and P50,000 on May 1, 2011.
solidary indivisible obligation: A and B solidarily

obliged themselves to give C a specific horse

2. according to Dean Ulan
a. if one of the debtors refuses to deliver the thing, the
other debtors cannot enforce the delivery (the obligation
becomes divisible)
b. refusal of the debtor to deliver the thing without just
cause - liable for damages
Art. 1211. Solidarity may exist although the creditors and the
debtors may not be bound in the same manner and by the same
periods and conditions. (1140)
Kinds of solidarity (APM):
a. Active solidarity - one that exists among creditors.
Creation of a relationship of mutual agency among the solidary
creditors by virtue of which each debtor is empowered to exercise
against the debtor or debtors not only the rights which correspond to
him, but also all the rights which correspond to the other creditors,
with the consequent obligation to render an accounting of his acts to
such creditor.
Juridical Effects:
1. Since it is a reciprocal agency, the death of a solidary creditor does
not transmit the solidary to each of his heirs but to all of them taken
together.
2. Each creditor represents the others in the act of receiving
payment, and in all other acts which tend to secure the credit or
make it more advantageous. Hence, if he receives only a partial
payment, he must divide it among the other creditors. He can
interrupt the period of prescription or render the debtor in default, for
the benefit of all other creditors.
3. One creditor, however, does not represent the others in such acts
as novation, compensation and remission. In these cases, even if the
debtor is released, the other creditors can still enforce their rights
against the creditor who made the novation, compensation or
remission.
4. The credit and its benefits are divided equally among them to
divide differently. Hence, once the credit is collected, an accounting
and distribution of the amount collected should follow.
5. The debtor may pay to any solidary creditor, but if a judicial
demand is made on him, he must pay only to the plaintiff.
6. Each creditor may renounce his right even against the will of the
debtor, and the latter need not thereafter pay the obligation to the
former.
b. Passive solidarity - one that exists among debtors.
Each debtor can be made to answer for the others, with the right on
the part of the debtor-payor to recover from the others their
respective shares. Similar to mutual guaranty.
Juridical Effects:
1. Each debtor can be required to pay the entire obligation; but after
payment, he can recover from the co-debtors their respective shares.
2. The debtor who is required to pay may set up by way of
compensation his own claim against the creditor, in this case, the
effect is the same as that of payment.
3. The total remission of debt in favor of a debtor releases all the
debtors; but when remission affects only the share of one debtor, the
other debtors are still liable for the balance of the obligation.
4. All the debtors are liable for the loss of the thing due even if such
loss is caused by the fault of only one of them, or by fortuitous event
after one of the debtors has incurred delay.

5. The interruption of prescription as to one debtor affects all the

others; but renunciation by one debtor of prescription already had
does not prejudice the others, because the extinguishment of the
obligation by prescription extinguishes also the mutual representation
among the solidary debtors.
6. The interests due by reason of the delay of one of the debtors are
borne by all of them.
c. Mixed solidarity- on the part of both creditors and debtors
N.B. According to Luna:
Solidarity does NOT require that the parties be bound in the same
manner. An obligation is solidary if the parties agreed or the law
intended it to be in solidum.
*example:
X, Y and Z solidarily onliged themselves to give C P15,000
according to the following terms:
X to pay on demand;
Y, in 2012;
Z, if C passes the CPA exam.
- Today, C can demand payment of P5,000, the share of X
out of the P15,000, against X or Z. This is so because the
shares of Y and Z have not yet matured. In 2012, C can
demand P5,000, the share of Y against X and Z. The
moment C passes the CPA exams, C may demand P5,000,
the share of Z against any of the three debtors.
Art. 1212. Each one of the solidary creditors may do whatever
may be useful to others, but not anything which may be
prejudicial to the latter.
- consequence of the relationship of mutual agency existing among
solidary creditors
Beneficial acts of the creditor (DIDS):
may demand the obligation to one, some or all debtors;
may interrupt prescription;
constitute the debtor in default; or
bring suit so that the obligation may produce interest.
Effect of beneficial act: if obligation has been performed, the other
creditors will have the right to demand from the creditor who received
the payment the shares corresponding to them.
Prejudicial acts of the creditor:
Remission is an act that is literally prejudice to the creditors, but it is
authorized under Article 1215, along with novation, compensation,
and merger or confusion.
To harmonize:
Art. 1212 = effect of the prejudicial acts among the creditors
themselves
Art 1215 = effect of the prejudicial acts among the creditors and the
debtor/s. *which are valid*
*Creditors have rights that subsist and can be enforced against the
creditor who performed the act alone. (Tolentino)
Effect of prejudicial act: indemnifying the other creditors for
damages.
Mutual Agency
Solidary obligation implies mutual agency. Hence, each one of the
creditors may, even without the knowledge of the other, do whatever
may be useful to them. Although prejudicial acts will produce legal
effect and extinguish the obligation of the debtor, the same will not,

however, be valid against the creditors who did not give their
consent.
*example: D is indebted to solidary creditors A dn B for P10,000. A
may, even without the knowledge of B, demand the payment of
P10,000 because each one of the solidary creditors may do whatever
may be useful to the other creditors may do whatever may be useful
to the other creditors even without the knowledge of the latter. If w/o
the knowledge of A, B remits the obligation, the obligation of D would
be extinguished, but B is obliged to give to A his share of P5,000.
Art. 1213. A solidary creditor cannot assign his rights without
the consent of the others.
- solidary creditor is an agent of the other creditors
- mutual agency implies mutual confidence which may take into
account the personal qualifications of each creditor
Effects of Unauthorized transfer:
It is implied, that such cannot be made, and the co-creditors and
debtors are not bound to recognize the assignment, and the
assignee is not regarded as a solidary creditor.
- payment to that assignee is considered a payment to a third person
and will not extinguish the obligation
- a suit filed by such assignee will not interrupt the prescription
- the creditor-assignor still has a liability to his co-creditors for
damages which may have been incurred by them as a result of the
assignment
If the assignment is made to a co-creditor, consent is not necessary
because the mutual confidence from the other creditors already exist.
Art. 1214. The debtor may pay any one of the solidary creditors;
but if any demand, judicial or extrajudicial, has been made by
one of them, payment should be made to him.
Judicial Demand:
Generally, each solidary creditor is a tacit mutual representative of
each other in demanding payment. But, if one creditor sues the
debtor/s, the tacit representation by the other creditors is considered
revoked.
Creditors who did not sue will lose their representation of
the others
A payment to the creditor/s who did not sue will be
considered as payment to a third person, in so far as the
shares of the others in the credit are concerned.
If payee did not turn the shares of the other creditors who
demanded, the debtor can still be required to pay the
creditor-plaintiff minus the share of the payee
The action, however, does not definitely eliminate the other creditors,
but only during the time the effect of the actions exist. If action is
dismissed, the other creditors may in turn sue the debtor.
Extrajudicial Demand:
Demand made extrajudicial has the same effect as judicial demand in
terminating the mutual representation of among the solidary creditors
and making the creditor who demanded as the agency alone.
Tolentino: If one creditor should make an extrajudicial demand, and
then takes no further step to enforce collection in court, all the other
creditors are barred forever from filing an action to demand payment
judicially, and the debt may never be collected. In this case, such
same effect is juridically erroneous and impractical.

If all or several creditors demand payment separately, the debtor

should pay the first one who notified him.
If they demand at the same time, or in a single action or written
demand, the debtor preserves his right to choose whomever
payment will be made by him
If partial payment has been made before the demand arises, the
debtor can pay the creditor the full obligation minus the
obligation he already performed. To not do so will result in unjust
enrichment.
In mixed solidarity, the debtors who were not demanded by the
creditor to pay him can still pay the other creditors who did not
make the demand.

Payment of Solidary Obligation

General Rule: payment to any one of the solidary creditor
extinguishes the obligation. If any demand has been made by any of
the creditors, the debtor against whom the demand was made should
pay only to that creditor. If he pays to any other creditor, the payment
is not valid.
Example
A and B are solidary indebted to solidary creditors C and D in
the amount of P10,000. A may pay P10,000 to C or D. However, if a
demand is made only to A
Art. 1215. Novation, compensation, confusion or remission of
the debt, made by any of the solidary creditors or with any of
the solidary debtors, shall extinguish the obligation, without
prejudice to the provisions of Article 1219.
The creditor who may have executed the any of these acts, as
well as he who collects the debt, shall be liable to the others for
the share in the obligation corresponding to them.
Novation extinguishment of an obligation by the substitution or
change of the obligation by a subsequent which extinguishes or
modifies the first, either by changing the object or principal
conditions, or by substituting the person of the debtor, or by
subrogating a third person in the third rights of the creditor.
The solidary debtor may release the others by binding himself alone
in their place in favor of the creditor. The debtor who effects the
novation cannot, by himself, bind the other to a new debt without
their consent.
Mere extension of time for payment given by the creditor to a solidary
debtor does not release the others from the obligation.
*In suretyship: as sureties are bound in solidum, material alteration
made by the creditor and the principal debtor, without the knowledge
and consent of the sureties, completely discharges the sureties from
all liability in the contract of suretyship.
An extension of time granted to the debtor by the creditor
extinguishes the liability of the others, but where the sureties are
liable for different payments, an extension of time with one or more
will not affect the liability of the sureties for the others.
Dation in payment the delivery of a specific object as a substitute
for the performance of the obligation
if in a form of a promise, it amounts to a novation
it should be treated as a payment, as it is essentially so

Compensation a mode of extinguishment to the concurrent

amount, the obligation of those persons who in their own right are
reciprocally debtors and creditors of each other
Confusion merger of qualities of creditor and debtor in one and the
same person with respect to one and the same obligation
If the compensation or confusion is partial, and there is doubt as to
what part of the debt it should be applied, the rules on application of
payments shall govern. If it is total, the obligation is extinguished,
leaving the liability for reimbursement within each group.
Remission is an act of pure liberality by virtue of which, the
creditor, without having received any compensation or equivalent,
renounces his right to enforce the obligation, thereby extinguishing
the same either in its entirety or in the part or aspect thereof to which
the remission refers.
When one creditor makes the remission = extinguishes the
obligation to the extent which is made, but the creditor shall be
liable to his co-creditors for their shares
When several of the creditors make the remission = all will
be liable for the shares of the creditors who did not remit, and if
one is insolvent, his share shall be made up by the others who
concurred in the remission.
Remission covers the entire obligation = obligation is totally
extinguished, the entire juridical relation among the debtors is
terminated altogether
Remission in favor of the debtor, if partial = character as
solidary debtor still remains
Remission in favor of the debtor, if full = ceases to have
any relation with the creditors, unless the continuation of his
solidary relation has been expressly reserved. However he is
still bound with respect to his co-debtors, in case of insolvency
of one debtor, the released debtor still has to pay his share in
the portion of the insolvent. He also cannot recover anything
from his co-debtor, since remission is a gratuitous act.
* Rules with regards to the debtors shall not apply when the debt was
fully paid by anyone of the debtors before the remission was made.
Effects of the Acts:
Between creditors and debtors any of the acts will extinguish
the obligation, therefore no creditor may sue the debtor after
such act
Between co-creditors any act of them in extinguishing the
obligation shall not prejudice the rights of the other creditors to
recover their shares in the obligation to the creditor who effected
any of the acts mentioned.
Between co-debtors the debtor whose obligation was
extinguished cannot recover from his other co-debtors more
than their respective shares in whatever he may have given up
or lost as the consideration for the extinguishment of the
obligation
In total compensation, he can recover from the others their
respective shares in the obligation, since he has given his
own credit to extinguish the obligation
In merger, if one co-debtor acquires the whole credit, he
can still demand from the other debtors their respective
shares
In remission, the debtor whose remission was made cannot
recover anything from the other debtors since he gives or
loses nothing.

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.
- the solidary debtors may be sued simultaneously in one suit or
successively in different actions.
- this article is not of public interest, therefore the parties may validly
stipulate that the solidary debtors can only be sued simultaneously or
provide for the order in which the debtors may be sued individually.
Passive Solidarity and Suretyship:
Similarities:
1. stands for some person
2. after payment, may require that they be reimbursed
Distinctions:
Solidary Debtor
Surety
Liable not only for his coLiable only for his debtors
debtors obligation, but also for obligation
his own
Responsibility to co-debtor is Responsibility to co-debtor is
primary
subsidiary
Extension of time given by the Extension of time given by the
creditor would not release the creditor would release a surety
solidary debtor
or solidary guarantor
Liability of Solidary Debtors:
the creditors may bring an action against the debtors and
sureties, either alone or together with the principal debtor,
even if the surety is not included in the first suit.
If the principal debtor is held in default, the surety is also held
in default, since his obligation is as the same as the principal
Solidary co-debtor is not released from his liability even if the
creditor brought an action against a co-debtor first, caused
execution on the properties of such co-debtor, which was later
voluntarily relinquished due to a valid third-party claim
Judgment as Regards Creditors:
If it is favorable to the creditor, it inures to the benefit of cocreditors.
If it is adverse to the creditor-plaintiff, it can be set up against
the other co-creditors in subsequent actions, unless it is founded
on a cause personal to the creditor-plaintiff in the first action.
Judgment as Regards Debtors:
If it is favorable to the creditor-plaintiff, but the defendant-debtor
is insolvent, the other debtors can still be sued until the debt is
fully paid. Judgment against one debtor cannot be enforced
against the others; a new action is needed. A judgment rendered
against several defendants can be revived against only one of
them.
If it is favorable to the defendant-debtor, it amounts to an
extinguishment of the obligation with respect to him, and it must
necessarily inure to the benefit of the other co-debtors, except
when the cause is personal to the defendant-debtor.
Art. 1217. Payment made by one of the solidary debtors
extinguishes the obligation. If two or more solidary debtors offer
to pay, the creditor may choose which offer to accept.

He who made the payment may claim from his co-debtors only
the share which corresponds to each, with the interest for the
payment already made. If the payment is made before the debt
is due, no interest for the intervening period may be demanded.
When one of the solidary debtors cannot, because of his
insolvency, reimburse his share to the debtor paying the
obligation, such share shall be borne by all his co-debtors, in
proportion to the debt of each.
*Payment consists in the delivery of the thing or the rendition
(rendering) of the service whish is the object of the obligation.
*Interest compensation for the use of borrowed money
Payment by a Solidary Debtor:
- results in the release from liability of the other debtors to the
creditor.
- Where one of several persons who are sued upon a joint and
several liability elects to pay the whole, such person may be properly
substituted in the same action as plaintiff for the purpose of enforcing
contribution from his forme associates.
- Gives birth to a right in favor of the paying debtor, and imposes on
the other co-debtors the duty to pay him their shares in the
discharged obligation.
- The right of the paying co-debtor to be reimbursed is not based on
the original obligation but upon the payment made by him, hence he
is only entitled to claim from his co-debtors the share pertaining to
each with interest on the amount advanced.

If partial payment has been made, the solidary debtor can only
recover reimbursement from the co-debtor only in so far as hi
payment exceeded his share of the obligation.
In reimbursement, when the solidary debtor pays the total
obligation, the resulting obligation of the other co-debtors to
reimburse him becomes joint.
If one, by insolvency, cannot pay his share in the
reimbursement, the others, including the one who paid, shall
bear such share proportionately.
Note: Kat and our other classmates said that since the article stated
in proportion to the debt of each, the share of the insolvent should
not be divided equally among the remaining co-debtors, but should
be dependent in their share, in cases when each debtor is required
to pay different amounts of debt. To get this, according to Rayn, we
should first add the shares of the remaining co-debtors, and after get
the proportion of each debtor based on the sum. For example, A, B,
and C are solidary debtors to pay a total of $900,000. A will pay
$400,000, B will pay $300,000, and C will pay $200,000. A paid the
whole amount already but B became insolvent. So add A and Cs
share first = 400,000+200,000=600,000. Then divide the shares from
the sum, A=4/6 or 2/3 and C=3/6 or 1/3. Then apply it to Bs share,
which is $300,000. As share=(2x300,000)/3=.200,000 and Cs
share=(1x300,000)/3=100,000. Im not sure if this is really right but I
hope it helps. =)Art. 1218. Payment by a solidary debtor shall not
entitle him to reimbursement from his co-debtors if such payment is
made after the obligation has prescribed or become illegal. (n)
No reimbursement if:
Obligation PRESCRIBES
Obligation becomes ILLEGAL (Law has been
passed, making such prestation illegal)
Prescriptive period of actions:
Within 10 years (upon a written contract, upon an

obligation created by law)

Within 6 years (upon an oral contract, upon a
quasi-contract)
Within 4 years (upon an injury to the rights of the
plaintiff, upon a quasi-delict)
The statute of limitations, however, may be
superseded or modified by a contract between
parties.

Neither can a solidary debtor who pays the obligation which has
already prescribed recover from the creditor has been paid by him
In other cases, where the obligation no longer exists, he can
recover from the creditor the amount paid, under the rules on quasicontract.
Art. 1219. The remission made by the creditor of the share
which affects one of the solidary debtors does not release the
latter from his responsibility towards the co-debtors, in case the
debt had been totally paid by anyone of them before the
remission was effected. (1146a)
To exempt the co-debtor whose part is thus subsequently remitted
will give way to fraud.
Any belated (delayed) remission by the creditor of the share of any
of the debtor has no effect on the internal relationships of the codebtors.
A, B, C solidarily owe D P1,500.00. B paid the entire
obligation. After which, D remitted the share of C. B can
collect P500.00 each from A and C even if the share of C in
the obligation had been remitted.
After the prior payment of the entire obligation, there is nothing to
remit because the obligation has been extinguished.
A, B, C solidarily owe D P1,500.00. D remitted the
share of C. Thereafter, B paid the entire obligation. B can
collect P500.00 from A but not from C. However, B may ask
D to give back P500 which is the supposed-to-be share of
C.
What is the effect of the insolvency of anyone of the remaining
debtors?
In the above case, there are three views:
The creditor should bear the loss due to insolvency. Thus, in the
example given the share of the insolvent debtor is P2,000, and each
of the other four debtors should contribute P500 to cover it. The P500
due from the debtor whose share was remitted, is considered as
included in the remission; hence, the debtor who paid the full balance
of P8,000 can recover the P500 from the creditor as a payment of
what is not true.
Tolentino: This view presumes that the creditor has
remitted more than the share of the debtor he has
favoured; it is juridically unsound to consider a gratuitous
act as extending beyond the intent of the grantor-creditor.
The rule is that gratuitous acts should be restrictively

construed as to permit the least transmission of rights.

The remission of the share of the one of the debtors does not
affect his obligation to contribute to the share of an insolvent codebtor. In other words, in the given example the debtor whose share
was remitted must pay P500 to the debtor who paid the entire
balance of P8,000.
Tolentino: This view is justified by: In every solidarity, there is a
dual relationship(1) the relation between the creditor and the
debtors; (2) the relation among the debtors themselves. When a
creditor remits the share of any debtor, he can affect only the first
relation, because he is totally a stranger to the second relation. This
relationship among the debtors is expressly governed by law in the
last paragraph of Art. 1217, which imposes on every co-debtor the
duty of contributing to the share of the insolvent debtor. This is a
provision that does not affect the creditor, and no act of the creditor
should affect the relation to the debtors under it. the credit cannot
therefore, by his act exempt any debtor from the obligation imposed
by it.
The share of the insolvent must be divided only among the other
co-debtors, excluding the one whose share has been remitted. In
other words, the debtor who paid the whole obligation of P8,000, in
the example given, can recover only from the other two solvent
debtors who shall reimburse one-third each of the amount paid to the
creditor

Tolentino: Like the first, this is also unacceptable

because it makes the remission of the share of
one debtor increase the burden of the other
debtors without their consent.

Art. 1220. The remission of the whole obligation, obtained by

one of the solidary debtors, does not entitle him to
reimbursement from his co-debtors. (n)
There is nothing to be reimbursed because he did not not spend
any money, the remission being a gratuitous act.
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. (1147a)
Application is limited to the case of non-performance because of
the loss of the thing or impossibility of the prestation that is due

Fortuitous event (debtor has no fault or delay)

obligation is extinguished

Fault of any of the debtorall are liable because

of their mutual agency

 Fortuitous event (after a debtor has incurred in delay)

obligation is converted into obligation to pay indemnity,
consisting of the price, damages and interest. The creditor
can recover such to any of the debtors, guilty or not. In the
event that the innocent debtor pays the indemnity, the guilty
should reimburse him. The guilty debtor shoulders all the
consequences of the loss because of his fault and delay;
hence, he cannot reimburse from the innocent ones the
indemnity.
If the thing due was not lost, but there is merely a delay, fraud or
negligence on the part of one of the solidary debtors, all (including
the innocent) debtors will share in the payment of the PRINCIPAL
prestation. The damages and interest imposed will be borne by the
guilty debtor.
Art. 1222. A solidary debtor may, in actions filed by the creditor,
avail himself of all defenses which are derived from the nature
of the obligation and of those which are personal to him, or
pertain to his own share. With respect to those which personally
belong to the others, he may avail himself thereof only as
regards that part of the debt for which the latter are responsible.
(1148a)
Defenses available to a solidary debtor when sued by the creditor:

Defenses derived from the nature of the

obligationthose which may contribute to
weaken or destroy the vinculum juris existing
between the debtor and creditor such as
payment, prescription, remission, statute of
frauds, presence of vices of consent, etc.

Defenses personal to the debtor-defendantmay

be either total or partial; such as minority, insanity
and others purely personal to him; if the personal
takes the form of special terms or conditions
affecting his part of the obligation, he may utilize
them only with respect to his part, but he can still
be sued for the portions not subject to the terms
or conditions because he is solidary liable.

Defenses personal to the other solidary debtors

the debtor being sued may also set up
defenses which are personal to the other solidary
debtors, whether such defenses affect the
capacity or consent of such debtors or only refer
to terms or conditions affecting their shares.

SECTION 5. - Divisible and Indivisible Obligations

Art. 1223. The divisibility or indivisibility of the things that

are the object of obligations in which there is only one
debtor and only one creditor does not alter or modify the
provisions of Chapter 2 of this Title. (1149)

A thing is considered indivisible when if divided into

parts, its value is diminished disproportionately. A thing is
divisible is when each one of the parts into which it is
divided forms a homogenous and analogous object to
the other parts as well as to the thing itself
Kinds of division
1. Qualitative - thing is not entirely
homogenous ex. A and B are heirs of C.
They agreed to divide their inheritance
as follows: to A a house and lot home
appliances and to B a rice field, a car
and P10,000 cash.
2. Quantitative-thing
divided
is
homogenous; the parts themselves may
be separated ex. If the inheritance is a
rice field, the partition is by metes and
bounds into equal parts.
3. Idealwhen the parts are not separated
in a material way, but there are assigned
to several persons the undivided
portions pertaining to them, as in coownership ex. suppose the car and the
rice field, in the first example, were
inherited by both A and B. As co-owners,
their one-half shares in the car are not
separable in a material way but only
mentally. Similarly, before the land is
actually divided between A and B, they
are merely co-owners, and neither one
of them can say that he is the absolute
owner of a specific portion thereof.
Divisible obligationone which is susceptible of
performance; the debtor can legally perform the
obligation by parts and the creditor cannot demand a
single performance of the entire obligation
Indivisible obligationwhen it cannot be performed in
parts
Divisibility or indivisibility of the obligationrefers to
the performance of the prestation and not to the thing
which is object thereof; it should not be confused with
the divisibility of the thing. The thing may be divisible, yet
the obligation may be indivisible.
Example: D obliged himself to deliver to B a specific
car on November 15. This obligation is indivisible
because it is not capable of partial performance. The car
must be delivered at one time as a whole.

Kinds of Indivisibility:
(1) Legal indivisibility where a specific
provision of law declares as indivisible, obligations
which, by their nature, are divisible (Art. 1225, par.3)
(2) Conventional indivisibility where the will of
the parties makes as indivisible, obligations which,
by their nature, are divisible (Art. 1225, par.3)

(3) Natural indivisibility where the nature of

the object or prestation does not admit of division,
e.g., to give a particular car, to sing a song etc.
Where there is only one creditor and one debtor,
the latter has to perform the obligation in its totality,
whether or not the prestation is divisible. Unless
there is an express stipulation to that effect, says
Article 1248, the creditor cannot be compelled
partially to receive the prestations in which the
obligation consists; and in accordance with Article
1232, an obligation is not deemed paid unless the
thing or service in which the obligation consists has
been completely delivered or rendered, as the case
may be.

Art. 1224. A joint indivisible obligation gives rise to

indemnity for damages from the time anyone of the
debtors does not comply with his undertaking. The
debtors who may have been ready to fulfill their
promises shall not contribute to the indemnity beyond
the corresponding portion of the price of the thing or of
the value of the service in which the obligation consists.
(1150)
Indivisible joint obligationthe object is indivisible but
the liabilities of the parties is joint
4. To enforce it, Article 1209 has
established the necessity of collective
fulfilment and the action must be against
all the debtors
Solidarity and indivisibility in obligations are NOT
identical; neither does one imply the other.
Solidarity
Refers to the vinculum and
therefore principally to the
subjects of the obligation
Requires plurality of
subjects
Such solidarity remains
even when there has been
non-performance and the
debtors become liable for
damages
The death of the debtor
terminates the solidarity,
which is not transmitted to
the heirs

Indivisibility
Refers to the prestation of
the object of the obligation
Not required
When the indivisible
obligation is converted into
one to pay damages, the
reason for the indivisibility
ceases to exist, and each
debtor becomes liable for
his part of the indemnity
Affects the heirs of the
debtor in that they remain
bound to perform the same
prestation

If the obligation is solidary and indivisible, every debtor

is liable for losses and damages, although those ready to
perform can later recover from the guilty one.

Art. 1225. For the purposes of the preceding articles,

obligations to give definite things and those which
are not susceptible of partial performance shall be
deemed to be indivisible.
When the obligation has for its object the execution of a
certain number of days of work, the accomplishment of
work by metrical units, or analogous things which by
their nature are susceptible of partial performance, it
shall be divisible.
However, even though the object or service may be
physically divisible, an obligation is indivisible if so
provided by law or intended by the parties.
In obligations not to do, divisibility or indivisibility shall be
determined by the character of the prestation in each
particular case. (1151a)
True test of divisibility: whether the obligation is
susceptible of partial compliance or not.
Factors which determine whether an obligation is
divisible or not:
5. Will or intention of the parties
(expressed or implied)
6. Objective or purpose of the stipulated
prestation
7. Nature of the thing
8. Provisions of law affecting the prestation
In indivisible obligations, partial performance is
equivalent to non-performance as confirmed by Article
12333, which requires complete performance of the
obligation, and Art. 12484, which forbids partial fulfilment,
except
9. Where the obligation has been
substantially performed in good faith,
the debtor may recover as is there had
been complete performance, minus the
damages suffered by the creditor (Art.
1234)
10. When the creditor accepts performance,
knowing its completeness, and without
protest, the obligation is deemed fully
performed (Art. 1235)
Severable and Entire Obligations
11. Divisible and indivisible obligations are
not necessarily identical to severable
and entire contracts, respectively.
Whether the contract is severable and
entire depends in general upon the
3

Art. 1233. A debt shall not be understood to have been paid

unless the thing or service in which the obligation consists has
been completely delivered or rendered, as the case may be.
(1157)
4

Art. 1248. Unless there is an express stipulation to that

effect, the creditor cannot be compelled partially to receive
the prestations in which the obligation consists. Neither may
the debtor be required to make partial payments.
However, when the debt is in part liquidated and in
part unliquidated, the creditor may demand and the debtor
may effect the payment of the former without waiting for the
liquidation of the latter. (1169a)

Features

Effect of
Illegality

Effect of
nullity

Statute of
frauds5
- contract
of sale of
chattels
Statute of
frauds
-partial
delivery or
partial
payment

consideration to be paid, not upon its

object
Severable
Entire
the consideration consideration is
is expressly or by single; when the
implication
consideration is
apportioned; the
entire and single, the
part to be
contract must be
performed by one held to be entire,
party consists in
although the subject
several distinct
matter may be
and separate
distinct and
items, and the
independent items
price is
apportioned to
each of them
If one part is
If a part is illegal, the
illegal, the part
whole contract is
which is illegal is
unenforceable. If,
void and cannot
however, the parties
be enforced, but
have apportioned the
that part which is
different
legal is
considerations
enforceable.
among the
respective
covenants, and such
legal reciprocal
considerations and
covenants can be
separated from the
illegal, the legal ones
can be enforced.
If one of the undertakings is void because
of its subject matter, but it is not illegal,
then the valid covenants may be
enforced, whether the contract is
severable or not.
Each sale for a
The contract is
price below the
affected by the
statutory limit is not statute and must
affected by the
be in writing
statute
A part payment or
A part payment or
part delivery of
part delivery will be
each item removes sufficient to remove
that item from the
the whole contract
statute, but the
from the operation
rest, if above the
of the law.
statutory limit of
price, are still
within the statute.

Obligations deemed indivisible:

1. Obligations to give definite things
Example: To give a particular electric fan; to
deliver a specific house. Here, the obligation is
5

indivisible because of the nature of the subject

matter.
2. Obligations which are not susceptible to partial
performance
Examples: To sing a song; to dance the tinikling.
Here, the obligation is indivisible by reason of its
purpose which requires the performance of all
the parts. Is the obligation still indivisible if there
are more than one participant? The obligation
becomes divisible as far as the participants are
concerned, because it is capable of partial
performance.
3. Obligations provided by law to be indivisible
even if thing or service is physically divisible.
Examples: Under the law, taxes should be paid
within a definite period. Although money is
physically divisible, the amount of tax payable
must be delivered in toto, not partially.
4. Obligations intended by the parties to be
indivisible even if thing or service is physically
divisible.
Examples: The obligation of D to give P1,000.00
to C on a certain date. Money is physically
divisible but the clear intention here is for D to
deliver P1,000.00 at one time and as a whole.
Obligations deemed divisible:
1. Obligations which have for their object the
execution of a certain number of days of work
Example: The obligation of D to paint the house
of C, the painting to be finished in 10 days.
Here, the obligation need not be fulfilled at one
time.
2. Obligations which have for their object the
accomplishment of work by metrical units.
Example: The obligation of D to make a table, 3
feet wide and 5 feet long; the obligation of D and
B to deliver 20 cubic meters of sand. But the
obligation of D alone to deliver 20 cubic meters
of sand is indivisible.
3. Obligations which by their nature are susceptible
of partial performance
Example: The obligation of D to teach
Obligations and Contracts for one year in a
university; the obligation of E to render 3 song
numbers in a program; the obligation of F to pay
a debt of P1,200.00 in 12 monthly installments
of P100.00 but each prestation to pay P100.00
is indivisible as it is to be delivered at one time
and in its totality.
Divisibility or indivisibility in obligations not to do
In negative obligations not to do, the character
of the prestation in each particular case shall determine
their divisibility or invisibility.

Obligations to do and not to do are generally

invisible. Obligations to do stated in paragraph 2 of
Article 1225 of are divisible.

Obligations and Contracts Reviewer 24

F-r-1-e-n-d-s (1-E, 2010-2011)
Section 6- Obligations with a Penal Clause
Principal Obligations- one which can stand by
itself and does not depend for its validity and
existence upon another Obligation.
Accessory Obligation- one which is attached to a
principal obligation and, therefore, cannot stand
alone.
Example: X promises to deliver to Y a specific
horse. (Principal Obligation) In case of nonfulfillment, X shall pay a penalty of 100,000.00php.
(Accessory Obligation)
***The accessory obligation to give the payment of the
penalty of 10,000 php cannot stand alone. X cannot just
pay the penalty. This obligation is attached to the
fulfillment principal obligation which is to give the specific
horse.****

Penal Clause- is an accessory undertaking

attached to an obligation to assume greater liability
in case of breach (non-fulfillment, partly fulfilled or
irregularly complied with)
PENAL CLAUSE VS CONDITION
Penal Clause
Still constitutes an
obligation (to give or to
do)
Demandable in default
of the unperformed
obligation and
sometimes jointly with
it

Condition
Not an obligation
Never Demandable

PURPOSE OF PENALTY
1. Funcion coercitivao de grantia- insure
performance of obligation by creating an
effective deterrent against breach, making
the consequences of such breach onerous
as it may be possible. (Yulo vs. Chan Pe,
101 Phil. 134) This is the general purpose
of a penal clause.
2. Funcion liquidatoria- to liquidate the
amount of damages to be awarded to the
injured party in case of breach of the
principal obligation. (compensatory)
3. Funcion estrictamente penal- in certain
exceptional cases, to punish the obligor in
case of breach of principal obligation or
violation of his obligation (punitive)
KINDS OF PENALTY (penal clause)
1. As to its origin:
a. Legal- penalty provided by law
b. Conventional- provided for by
stipulation of the parties
2. As to its purpose:
a. Compensatory- penalty takes the
place of damages in case of
breach
b. Punitive- penalty imposed merely
as punishment for breach
3. As to effect or demandability:
a. Subsidiary or alternative- when
only the penalty can be enforced or
demanded
b. Joint or Cumulative- when both the
principal obligation and the penal
clause can be enforced or
demanded

Obligation with a Penal clause is one which

contains an accessory obligation attached to
the principal obligation, which imposes an
Art. 1226. In obligations with a penal clause, the
additional liability or an accessory undertaking
penalty shall substitute the indemnity for damages
to pay a previously stipulated indemnity in case
and the payment of interests in case of
of breach of the principal obligation.
noncompliance, if there is no stipulation to the
contrary. Nevertheless, damages shall be paid if the
***It pushes the debtor to perform his obligation obligor refuses to pay the penalty or is guilty of
faithfully and without delay within the period fraud in the fulfillment of the obligation.
agreed upon, or else, he suffers a fixed civil penalty
without need of proving the damages of the other
party***
***Measure beforehand the damages which would result
from non-compliance

The penalty may be enforced only when it is

demandable in accordance with the provisions of
this Code. (1152a)

Obligations and Contracts Reviewer 25

F-r-1-e-n-d-s (1-E, 2010-2011)
GR: PENALTY: as compensation or substitute for
damages.
XPN: PENALTY: as punitive a form
GR: The penalty imposable is a substitute for the
indemnity for:
1. Damages (reparation)
damages not needed; in case of
breach, the stipulated indemnity or
prestation represents a legitimate
estimate made by the contracting
parties.
2. payment of interest in case of breach of
obligation (compensation)
*** unless the contrary is stipulated

XPN: Damages or interests and penalty in case

of breach may be recovered from the following
acts:
1. If the debtor refuses to pay the penalty
2. If the debtor is guilty of fraud in the
fulfillment of the obligation
3. If there is express stipulation that the
other damages or interests are
demandable to the penalty in the penal
clause
(purpose: to punish the obligor)
ENFORCEABILITY OF PENALTY

1. Penalty becomes demandable upon

breach.
2. Penalty must not be contrary to laws,
morals, good customs, public order or
public policy
3. ***In Reciprocal Obligation- non
compliance of parties although breach
is not willful like due to fortuitous event:
penal clause cannot be invoked***

Penalty substitutes for damages and interests

As a general rule, in an obligation with a penal
clause, the penalty takes the place of the indemnity
for damages and the payment of interests in case
of non-compliance (Art. 1226). Proof of actual
damages suffered by the creditor is not necessary
in order that the penalty may be enforced.
When creditor may recover damages
The creditor, in addition to the penalty, may
recover damages and interests:
(1) When so stipulated by the parties;
(2) When the obligor refuses to pay the
penalty, in which case the creditor may
recover legal interest thereon; or
(3) When the obligor is guilty of fraud in the
fulfilment of the obligation, in which case
the creditor may recover damages caused
by such fraud.
Example: D promised to construct a house for
C. The contract carried a penal clause that in
case of non-compliance, X would have to pay a
penalty of P50,000.00. X did not construct the
house and, as a consequence, Y suffered
damage in the amount of P40,000.00.
In this case, the penalty of P50,000.00 shall
be paid. Y cannot recover more than
P50,000.00, the penalty stipulated, even if he
proves that the damages suffered by him is
P60,000.00.
The penalty substitutes the indemnity for
the damage P40,000.00, unless there is a
stipulation to the contrary, in which case Y may
also recover the damages proved by him.
If X refuses to pay the penalty, Y may recover
legal interest thereon, the interest representing new
damages brought about by the non-payment of the
penalty.
If X is guilty of fraud (not mere fault) in the
fulfilment of his obligation, he is also liable for the
damages caused thereby in conformity with Article
1171. Proof of the fraud and the existence and
amount of damages is incumbent upon Y. But Y
need not prove fraud to recover the penalty.
When penalty may be enforced
The penalty may be enforced only when it is
demandable in accordance with the provisions
of the Civil Code. This means that the penalty,
as a stipulation in a contract, is demandable
only if there is a breach of the obligation and it
is not contrary to law, morals, good customs,
public order, or public policy. (Art. 1306)

Obligations and Contracts Reviewer 26

F-r-1-e-n-d-s (1-E, 2010-2011)
Thus, if the obligation
due to a fortuitous event,
demandable. Under Article
may be reduced if it
unconscionable or in case
irregular fulfillment.

cannot be fulfilled
the penalty is not
1229, the penalty
is iniquitous or
there is partial or

GR: Debtor cant exempt himself from the

performance of the principal obligation by
paying the stipulated penalty
XPN: Right EXPRESSLY RESERVED for him to
substitute penalty for the principal obligation
***An obligation with penalty clause cannot

PENALTY NOT ENFORCEABLE:

be turned to facultative obligation unless expressly

stipulated in the contract.***

1. Impossible performance of principal

obligation due to fortuitous events
LIMITATION UPON RIGHT OF CREDITOR
2. Creditor prevented the debtor from
fulfilling the obligation
3. Penalty is contrary to good morals or
good customs
4. Both parties are guilty of breach of
contract
5. Breach of contract by the creditor
6. None of the parties committed any
willful or culpable violation of the
agreement
Art. 1227. The debtor cannot exempt himself from
the performance of the obligation by paying the
penalty, save in the case where this right has been
expressly reserved for him. Neither can the creditor
demand the fulfillment of the obligation and the
satisfaction of the penalty at the same time, unless
this right has been clearly granted him. However, if
after the creditor has decided to require the
fulfillment of the obligation, the performance thereof
should become impossible without his fault, the
penalty may be enforced. (1153a)
LIMITATION UPON RIGHT OF CREDITOR

GR: Creditor cant demand fulfillment of

principal obligation and satisfaction of the
stipulated penalty at the same time.

XPN:
1. when the creditor was CLEARLY given/
GRANTED the right to enforce both the
principal obligation and penalty
2. When the creditor has demanded
fulfillment of the obligation but cannot
be fulfilled due to:
debtors fault creditor may
demand for penalty and damages

without creditors fault he can

demand the penalty

***if creditor chooses penalty he cannot

afterwards demand fulfillment of principal
obligation.

Example: S is required to deliver to B certain

products; otherwise, he shall pay a penalty in
the amount of P10,000.00. Under the above
article, S cannot just pay the penalty as a

Obligations and Contracts Reviewer 27

F-r-1-e-n-d-s (1-E, 2010-2011)
substitute for non-compliance of the principal
obligation except when he is expressly given
the right by B to do so.

Art. 1228. Proof of actual damages suffered by the

creditor is not necessary in order that the penalty
may be demanded. (n)

Penal Clause presumed subsidiary

PROOF OF ACTUAL DAMAGE
General Rue: The creditor cannot demand
the fulfillment of the obligation and the Applicable on to Penal Clause which are as
satisfaction of the penalty at the same time. The compensation or substitute for damages or
payment of interest.
primary purpose of penalty is to urge the debtor
to the performance of the main obligation.
(1) Where there is performance no need
for demanding the penalty. The
exception arises when this right has
been clearly granted the creditor.
Under Articles 1227, therefore, the
general rule is that a penal clause is
subsidiary and not joint.
(2) Where there is no performance the
creditor may ask for the penalty or
require specific performance. The
remedies are alternative and not
cumulative nor successive, subject to
the exception that the penalty may be
enforced if after the creditor has
decided to require fulfillment, the same
should become impossible without his
fault. If there was fraud on the part of
the debtor, the creditor may recover the
penalty as well as damages for nonfulfillment.

GR: Proof of Actual damages not needed in

order for penalty to be demanded.

XPN: Stipulated penal clause as a punitive formdamages besides penalty still subsist. Actual
proof for damages needed in case of:

1. If the debtor refuses to pay the penalty

2. If the debtor is guilty of fraud in the
fulfillment of the obligation
3. If there is express stipulation that the
other damages or interests are
demandable to the penalty in the penal
clause

Art. 1229. The judge shall equitably reduce the

penalty when the principal obligation has been
When Penal Clause is Joint
partly or irregularly complied with by the debtor.
Even if there has been no performance, the penalty
The debtor has the right to pay penalty in
may also be reduced by the courts if it is iniquitous
lieu of performance only when this right has
or unconscionable. (1154a)
been expressly reserved for him. With respect
to the creditor, he has the right to demand
performance and payment of penalty jointly
when this right has been clearly granted him. It JUDICIAL REDUCTION OF PENALTY
is, therefore, not required that this right be
expressly reserved for him; an implied grant
clearly deducible from the evidence or the
1. When there is partial or irregular
nature of the obligation is sufficient.
performance

partial- refers to the extent of the

fulfillment which not all prestations
are complied.

Obligations and Contracts Reviewer 28

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irregular- refers to the manner by

which all prestations but not in
accordance to the tenor.

2. When the penalty agreed upon is

iniquitous or unconscionable - even if
there was no performance at all. In the
courts sound discretion to determine if
amount should be reduced because of
excessiveness.

INIQUITOUS OR UNCONSCIONABLE
when it is revolting to the conscience or
common sense; grossly
disproportionate to the damages
suffered.

Judges power to reduce penalties are

limited to private contracts.

Art. 1230. The nullity of the penal clause does not

carry with it that of the principal obligation.
The nullity of the principal obligation carries with it
that of the penal clause. (1155)
PRINCIPAL OBLIGATION VOID = PENAL
CLAUSE ALSO VOID

If the principal obligation is void it

necessarily follows that the penal clause
is also void- as the penal clause is only
an accessory obligation.

PENAL CLAUSE VOID = PRINCIPAL

OBLIGATION NOT NECESSARILY VOID.

GR: The accessory follows the principal

and not vice versa. If only penal clause
is void, the principal obligation is still
valid and demandable. The penal clause
is just disregarded. The injured party
may recover indemnity for damages in
case of non-performance of the
obligation as if no penalty had been
stipulated (art. 170)