OBLIGATIONS & CONTRACTS OUTLINE

Atty. Ian R. A. Pangalangan

PART I OUTLINE
I.

Introduction: The Importance of the Legal System

II.

Obligations in General
A.

Definition/Concept/Nature > Art. 1156 NCC

B.

Elements/Requisites

C.

Civil Obligation vs. Natural Obligation

D.

Sources > Art. 1157 to 1162 NCC

1.

2.

In General > Art. 1157 NCC

a.

Exclusive Enumeration

b.

Unilateral Promise

Law > Art. 1158, 19 NCC

a.

Necessity of Agreement

b.

Not Presumed
1.
2.
3.
4.

3.

Contracts > Art. 1159 NCC

a.

Autonomy of Will

b.

Abuse of Right

c.

Compliance in Good Faith

d.

Limitations

e.

Pre Contractual Obligations

1.
2.
3.

4.

Pelayo vs. Lauron, 12 Phil 543

Dela Cruz vs. North. Theatrical, 95 Phil 739
Serrano vs. CB, 96 SCRA 16
Canonizado vs. Benitez, 127 SCRA 610

Alcantara vs. Alinea, 12 Phil 453 (1907)

Pp. vs. Pomar, 46 Phil 440
Pichel vs. Alonzo, 111 SCRA 341

Quasi Contracts > Art. 1160, 2142, 2144, 2150, 2152, 2164,
2167 to 2168, 2174, 2175 NCC
1.
2.
3.

City of Cebu vs. Piccio, Dec. 31, 1960

PCIC vs. CA, 274 SCRA 597
Torres vs. CA 278 SCRA 973

2
5.

Delicts > Art. 1161 NCC; RPC Art. 100 to 110, Rule 111
Rules of Court (ROC)
a.

Basis

b.

Scope of Civil Liability

c.

Expanded Recovery of Damages

d.

Effect of Death/Acquittal on Civil Liability

1.
2.

6.

Castillo vs. CA, 176 SCRA 793

Ongsiako vs. IAC, July 31, 1987

Quasi Delicts > Art. 1162, 2144, 2150, 2152, 2164, 2167,
2168, 2174, 2175, 2177, 2180, 2182 NCC; Rule 111, ROC;
Cf. Art. 216 to 219 Family Code (FC)
a.

Concept/Definition

b.

Requisites

c.

Basis of Liability

d.

Negligence

e.

Liability for the Fault of Others

1.
2.
3.
4.
5.
6.
7.
8.

Rakes vs. Atlantic Gulf, 7 Phil 359

Picart vs. Smith, 37 Phil 809
Cangco vs. MRR, 38 Phil 768
Gutierrez vs. Gutierrez 56 Phil 177
Barredo vs. Garcia, Jul. 8, 1942
Mendoza vs. Arrieta, 91 SCRA 113
Brinas vs. Pp., 125 SCRA 687
PSBA vs. CA, 205 SCRA 729
PART II OUTLINE

III.

Nature and Effect of Obligations

A.

Concept of Generic and Determinate

B.

Prestation > Art. 1163 to 1168

1.

Kinds > Art. 1246; ROC 39, Sec. 10

a.

Duties of Obligor

b.

Personal Rights vs. Real Rights

c.

Delivery
1.
2.
3.
4.

Bishop of Jaro vs. Dela Pena, 26 Phil 144

Chavez vs. Gonzales, 32 SCRA 547
CB vs. CA, 139 SCRA 46
Agcaoili vs. GSIS, 165 SCRA 1

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C.

Breach
1.

Voluntary (Delay, Fraud, Negligence, Tenor Violation) > Art.

1169 to 1173
1.
2.
3.
4.
5.
6.
7.

2.

Involuntary (Fortuitous Event) > Art. 1174, 552, 1942, 2147

1.
2.
3.
4.
5.
6.
7.

3.

Lasam vs. Smith, 45 Phil 567

RP vs. Luzon Stevedoring, 21 SCRA 279
Dioquino vs. Laureano, 33 SCRA 65
Austria vs. CA, 39 SCRA 527 (1971)
Nakpil & Sons vs. CA, 144 SCRA, 597; 160
SCRA 334
NPC vs. CA, 161 SCRA 334
Southeastern College vs. CA, 292 SCRA 422

Remedies
a.

Rights of Creditor/Debtor > Art. 1381 Par.3, 1608,

1652, 1729, 2236
1.
2.

D.

Arrieta vs. NARIC, 10 SCRA 79

Jimenez vs. Manila, 150 SCRA 510
Meralco vs. CA, 157 SCRA 243
Telefast vs. Castro 158 SCRA 445
Go vs. CA, 272 SCRA 752
Singson vs. CA, 281 SCRA 639
Bachrach Corp. vs. CA 296 SCRA 487

Gen. Enterprises Vs. Llanga Bay Logging 11

SCRA 733
RCBC vs. CA 305 SCRA 449

Fulfillment of Obligations
1.

Bastida vs. Dy Buncio, 93 Phil 195 (1953)

PART III OUTLINE

IV.

Kinds of Obligations
A.

Pure Obligations > Art. 1179

1.
2.

B.

Floriano vs. Delgado, 11 Phil 154 (1909)

Pay vs. Palanca, 57 SCRA 818

Conditional Obligations
1.

Classification > Art. 1179, 1180, 1144, 1150

1.
2.
3.
4.
5.

2.

Patente vs. Omega, May 29, 1953

PNB vs. Lopez Vito, 52 Phil 41
Peoples Bank vs. Odom, 64 Phil 128
Gaite vs. Fonacier, 2 SCRA 831
Ducusin vs. CA, 122 SCRA 280

Conditional Obligations in General > Art. 1181, 1182, 1187, 1188

4
1.
2.
3.
4.
5.
6.
7.
3.

Osmena vs. Rama, 93 Phil 971(14 Phil 99)

Wise & Co. vs. Kelly, 37 Phil 696
Taylor vs. Uy Tieng Pao 43 Phil 873
Smith Bell vs. Sotelo Matti, 44 Phil 857
Parks vs. Province of Tarlac, 49 Phil 142
Jacinto vs. De Leon, 51 Phil 992
Tible vs. Aquino, 65 Phil 207

Impossible Condition > Art. 1183, 727, 873, 1181

1.
2.
3.
4.

Luneta Motor Co. vs. Abad, 67 Phil 236

Litton vs. Luzon Surety Co., Feb. 11, 1952
Santos vs. Secretary, Aug. 27, 1952
Rom. Catholic Archbishop of Manila. vs. CA, 198 SCRA 300

4. Positive and Negative Conditions > Art. 1184, 1185, 879

3.

Taylor vs. Uy Tieng Pao, 43 Phil 873

5. Constructive Fulfillment > Art. 1186

1.
4.
5.

Cruz vs. Ilagan, 46 OG (Suppl. No. 1) 352

Mana vs. Luzon Con, Mines (CA) 40 OG (Suppl. 4), 129
Taylor vs. Uy Tieng Pao, 43 Phil 873

6. Retroactivity > Art. 1187

1.
4.

Hermosa vs. Longara, Oct. 27, 1953

Enriquez vs. Ramos, 73 SCRA 116

7. Rules on Improvement, Deterioration or Loss of Thing > Art. 1189,

1190, 579, 580
8. Reciprocal Obligations > Art. 1191, 1192, 1234, 1592, 1593, 1786,
1788; 1484 to 1486, 1385, RA 6552, Cf. Art. 2203
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
C.

Song Fo vs. Hawaiian Phil. (1925)

Froilan vs. Pan Oriental Shipg. Co, 12 SCRA 276 (1964)
UFC vs. Pan Oriental Shipping Co., 35 SCRA 1
Zulueta vs. Mariano, 111 SCRA 206
Palay vs. Clave, 124 SCRA 638
Angeles vs. Calasanz, 135 SCRA 323 (1985)
Boysaw vs. Interphil Promotions, 148 SCRA 365 (1987)
Pilipinas Bank vs. IAC, 151 SCRA 546 (1987)
Suria vs. IAC, (1987)
De Erquiaga vs. CA, (1989) > Art. 1385
CB vs. CA, 139 SCRA 46 > Art. 1192

Obligation with a Period > Art. 1193 to 1198

1.

Benefit of Period > Art. 1196

1.
Ponce de Leon vs. Santiago Syjuco, Inc., 90 Phil 311
2.
Nicolas vs. Matias, 89 Phil 126
3.
Sia vs. CA & Valencia, 92 Phil 126

2.

Fixing of Period > Art. 1197

5
1.
2.
3.
4.
5.
6.
7.
8.
3.

Loss of Term > Art. 1198

1.
2.
3.
4.

D.

Alternative Obligations > Art. 1199 to 1205

1.
2.
3.
4.
5.

2.

Ocampo vs. Navarro, (CA) Jan. 30, 1963

Joint and Solidary Obligations

1.

In General > Art. 1207 to 1211

1.
2.
3.
4.
5.
6.

2.

Inchausti vs. Yulo, 34 Phil 978

Ronquillo vs. CA, 132 SCRA 274
Lirag Textile Mills vs. SSS, 153 SCRA 536
Malayan Insurance vs. CA, 174 SCRA 195
Soriano vs. CA
RCBC vs. CA, 178 SCRA 739

Rights and Obligations of the Parties > Art. 1212 to 1222

1.
2.
3.

Asiatic Petroleum vs. Hizon, 45 Phil 532

PNB vs. Independent Planters, 122 SCRA 113
Joseph vs. Bautista, 170 SCRA 540

Divisible and Indivisible Obligations > Art. 1223 to 1225, 1420, 2154
1.
2.
3.

G.

Molina vs. Dela Riva, 6 Phil 12

Agoncillo vs. Javier, 38 Phil 424
Ong Guan vs. Century Insurance, 48 Phil 592
Reyes vs. Martinez, 55 Phil 492
Legarda vs. Maiailhe, Apr. 28, 1951

Facultative Obligations > Art. 1206

1.

F.

Laplana vs. Garchitorena, 48 Phil 163

Timbol vs. Martin, 88 Phil 510 (1951)
Daguhoy Ent. vs. Ponce, 96 Phil 15, 50 OG 5267 (1954)
Gaite vs. Fonacier, 2 SCRA 831

Alternative and Facultative Obligations

1.

E.

Elezuigi vs. Law Tennis Club, 2 Phil 309

Encarnacion vs. Baldomar, 77 Phil 470
Araneta vs. Philsugar Estates, 20 SCRA 330
Philbanking vs. Lui She, 21 SCRA 484
Chavez vs. Gonzales, 32 SCRA 547
Lim vs. People, 133 SCRA 333
Millare vs. Hernando, 151 SCRA 484
Pacific Banking Corp. vs. CA (1989)

Angel Jose Warehousing vs. Chelda Ent., Apr. 24, 1968

Pasay City vs. CFI, 132 SCRA 156
Siasat vs. IAC

Obligations with a Penal Clause > Art. 1226 to 1230

1.
2.

Lambert vs. Fox, 26 Phil 588

Gen. Insurance & Surety vs. Republic, 7 SCRA 4

6
3.
4.
5.
6.
7.
8.

Mkti. Devco vs. Empire Insurance Co., 20 SCRA 557

Bachrach vs. Espiritu, 52 SCRA 346
Robes Frnacisco vs. CFI, 86 SCRA 59
Pamintuan vs. CA, 94 SCRA 556
GSIS vs. CA, 145 SCRA 311
Jison vs. CA, 164 SCRA 399
PART IV OUTLINE

V.

Extinguishment of Obligations
A.

In General > Art. 1231

1.
2.

B.

Saura Imports & export vs. DBP, 44 SCRA 445

Castro vs. Atienza

Payment or Performance > Art. 1232 to 1252, 1302, RA 525, RA

4100
1.

Payment in General
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

2.

Dation in Payment
1.
2.
3.

3.

Reparations Comm. vs. Univ. Deep Sea, 83 SCRA

764

Payment by Cession
1.

5.

Filinvest vs. Phil. Acetylene, 111 SCRA 421

Lopez vs. CA, 114 SCRA 671 (1982)
Citizens Surety vs. CA, 162 SCRA 738

Application of Payment
1.

4.

Velasco vs. Meralco, 42 SCRA 556

Kalalo vs. Luz, 45 SCRA 337
St. Paul Fire vs. Macondray, 70 SCRA 122
Ponce vs. CA, 90 SCRA 533
Comm. of Public Highways vs. Burgos 96
SCRA 686
New Pacific Timber vs. Seneris, 101 SCRA 686
Filipino Pipe vs. NAWASA, 161 SCRA 32
Del Rosario vs. Shell, 164 SCRA 556
Manacop vs. CA, 267 SCRA 759
Baritua vs. CA, Mar. 22, 1990

DBP vs. CA 316 SCRA 347

Tender of Payment and Consignation

1.
2.
3.
4.
5.
6.
7.

Legarda vs. Miailhe, Apr. 28, 1951

Sotto vs. Mjares, 28 SCRA 17
TLG Intl. vs. Flores, 47 SCRA 437
Soco vs. Militante, 123 SCRA 160
De Guzman vs. CA, 137 SCRA 730 (1985)
Mc Laughlin vs. CA 144 SCRA 693
Cebu Intl. Finance vs. CA, 316 SCRA 488

C.

Loss of the Thing Due > Art. 1262 to 1269, 1165, 1174, 1941, 1979,
2174, 552(2), 2159, 1504, 1655, 1717; RPC Art. 100, 104
1.

D.

Condonation or Remission of the Debt > Art. 1270 to 1274, 748,

749
1.
2.

E.

Yap Unki vs. Chua Jamco, 14 Phil 602

Gan Tion vs. CA, 28 SCRA 235
Mindanao Portland Cement vs. CA, 120 SCRA 930
Perez vs. CA, 127 SCRA 636
PNB vs. Ong, 148 SCRA 166
Francia vs. IAC, 162 SCRA 753
Silahis Mktg. vs. IAC, 180 SCRA 21
BPI vs. CA, Mar. 29, 1996
PNB vs. CA, Jul. 24, 1996
CHK Indus. vs. CA, 272 SCRA 333

Novation > Art. 1291 to 1304

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.

H.

Estate of Mota vs. Serra, 47 Phil 464

Chittick vs. CA, 166 SCRA 219

Compensation > Art. 1278 to 1290; Ch. 8 (Rules of Assignment of

Credit
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.

G.

Velasco vs. Masa, Mar. 5, 1908

Yam vs. CA, Feb. 12, 1999

Confusion of Merger > Art. 1275 to 1277

1.
2.

F.

Occena vs. CA, 73 SCRA 673

Ynchausti vs. Yulo, 34 Phil 978

Fua vs. Yap, 38 Phil 287
Tuisico vs. Havana, 45 Phil 707
Cabancalan vs. Pacheco, 55 Phil 555
Rodriguez vs. Reyes, 37 SCRA 195
Millar vs. CA, 38 SCRA 642
Sandico vs. Piguing, 42 SCRA 322
NPC vs. Dayrit, 125 SCRA 849
Integ. Construction vs. Relova, 146 SCRA 360
Cochingyan vs. R & B Surety, 151 SCRA 339
Balilia vs. IAC, 155 SCRA 262
Peoples Bank vs. Syvels 164 SCRA 671

Other Forms of Extinguishments

1.
2.
3.
4.
5.
6.
7.
8.
9.

Fulfillment of Resolutory Condition

Prescription
Rescission
Annulment
Death
Creditor Renunciation
Compromise
Arrival of Resolutory Period
Mutual Desistance

8
10.
11.
12.
13.
14.

Unilateral Withdrawal
Change of Civil Status
Rebus Sic Stantibus
Want of Interest
Judicial Insolency
1.
2.
3.

Ollendorf vs. Abrahamson 38 Phil 585

Saura vs. DBP, 44 SCRA 445
Vda. De Castro vs. Atienza, Oct. 17, 1973
PART V OUTLINE

VI.

Contracts
A.

In General > Art. 1305 to 1317

1.

Definition/Nature > Art. 1305

1.
2.
3.
4.
5.

2.

Stages > Art. 1305

1.
2.
3.

3.

Saura va. Sandico, 107 Phil 336

Cui vs. Arellano, 2 SCRA 205
Filipinas Cia vs. Mandanos, 11 SCRA 391
Republic vs. PLDT, 26 SCRA 620
Leal vs. IAC, 155 SCRA 394
Unimasters vs. CA, 267 SCRA 759
Sanchez vs. CA, 279 SCRA 647

Nominate and Innominate > Art. 1307

1.
2.

5.

Ma. Crismina Fertilizer vs. CA, 273 SCRA 152

San Juan Structural vs. CA, 296 SCRA 631
Gonzales vs. Heirs of Cruz, 314 SCRA 585

Limitations > Art. 1306

1.
2.
3.
4.
5.
6.
7.

4.

Batchelder vs. CB, 41 SCRA 45

Sy vs. Cb, Apr. 30, 1976
Bordador vs. Luz, 282 SCRA 45
ABS CBN vs. CA, 301 vs. 572
City of Cebu vs. Heirs of Rubi, 306 SCRA 408

Dizon vs. Gaborro, 83 SCRA 688

Corpus vs. CA, 98 SCRA 424

Characteristics > Art. 1308 to 1312, 1313, 1314, 1177, 1381

1.
2.
3.
4.
5.
6.

Daywalt vs. La Corp. delos Padres, 39 Phil 567

(1919)
Bonifacio Bros. vs. Mora, 20 SCRA 261
Kauffman vs. PNB, 42 Phil 182
Velasco vs. CA, 95 SCRA 616
Bank of America vs. IAC, 145 SCRA 419
Marimperio vs. CA, 158 SCRA 368

9
B.

Essential Requisites > Art. 1318, 1315, 1316, 1317, 1320 to 1323,
1324, 19, 1330 to 1334, 1345, 1346, 1347, 1348, 1349, 1350 to
1357
1.
Consent
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
2.

Object
1.

3.

Atilano vs. Atilano, 28 SCRA 232

Carantes vs. CA, 76 SCRA 514

Interpretation > Art. 1370 to 1379; Rules on Statutory Construction

1.
2.
3.
4.

F.

Hernaez vs. Delos Santos, 27 SCRA 1276

Lao Sok vs. Sabaysabay, 138 SCRA 134
Gallardo vs. IAC, 155 SCRA 248
Tan vs. Lim, 296, SCRA 455

Reformation of Instruments > Art. 1359 to 1369

1.
2.

E.

Lagunzad vs. Gonzales, 92 Phil 476

Law vs. Olympic Sawmill, 129 SCRA 439
Baliwag Transit vs. CA
Tong Bros. vs. IAC, 156 SCRA 726
Ladanga vs. CA, Aug. 24, 1984

Form of Contracts > Art. 1356 to 1358

1.
2.
3.
4.

D.

Saura vs. Sandico, 107 Phil 336

Cause
1.
2.
3.
4.
5.

C.

Mercado vs. Espiritu, 37 Phil 215

Sia Suan vs. Alcantara, 85 Phil 65
Braganza vs. Villa Abrile, 105 Phil 456
Sanchez vs. Rigos, 45 SCRA 368
Velasco vs. CA, 51 SCRA 439
Tang vs. CA, 90 SCRA 236
Ong Yui vs. CA, 91 SCRA 223
C & C Commercial vs. Menor, 120 SCRA 112
Carino vs. CA 152 SCRA 529
Weldon vs. CA, 154 SCRA 439

Borromeo vs. CA, 47 SCRA 65

Republic vs. Castelvi, 58 SCRA 336
Eastern Shipping vs. Margarine, 93 SCRA 256
Nool vs. CA, 276 SCRA 149

Defective Contracts > Art. 1380 to 1422

1.

Rescissible > Art. 1380 to 1389

1.
Oria vs. Mcmicking, 21 Phil
2.
UFC vs. CA, 33 SCRA 1
3.
Cabaliw vs. Sadora, 64 SCRA 310
4.
Siguan vs. Lim, 318 SCRA 725

2.

Voidable > Art. 1390 to 1402

10
1.
2.
3.
4.
5.
6.
7.
3.

Unenforceable > Art. 1403 to 1408

1.
2.
3.
4.
5.
6.
7.
8.
9.

4.

Villaroel vs. Estrada, 71 Phil 140

Castillo vs. Galban, 85 SCRA 526

Estoppel > Art. 1431 to 1439; Annotation 32 SCRA 542

1.
2.
3.
4.

IX.

Harding vs. Commercial Union, Aug. 10, 1918

Liguez vs. CA, 102 Phil 577
Briones vs. Cammayo, 41 SCRA 404
Rubias vs. Batiller, 51 SCRA 120
Castro vs. Escutin, 90 SCRA 349
Ponce vs. CA, 90 SCRA 533
Godinez vs. Fong, 120 SCRa 223
Yap vs. Grajeda, 121 SCRA 244
Tongoy vs. CA, 123 SCRA 99
Lita Ent. vs. IAC, 129 SCRA 79
Yanas vs. Acaylar, 136 SCRA 52
Arsenal vs. IAC, 143 SCRA 40
Teja Mktg. vs. IAC, 148 SCRA 347
Vda. de Portugal vs. IAC, 159 SCRA 178
Rongavilla vs. CA, 294 SCRA 289

Natural Obligations > Art. 1423 to 1430

1.
2.

VIII.

Cabague vs. Auxillo, 92 Phil 294

Ortega vs. Leonardo, 103 Phil 370
Carbonnel vs. Poncio, 103 Phil 655
Eusebio vs. Sociedad, 16 SCRA 569
Yuvienco vs. Dacuycuy, 104 SCRA 658
Clarin vs. Relona, 127 SCRA 512
Bisaya Land Trans. vs. Sanchez, 153 SCRA 532
Hernandez vs. CA, 160 SCRA 921
Villanueva vs. CA, 267 SCRA 89

Void > Art. 1409 to 1422

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.

VII.

Uy Soo Lin vs. Tan Unchuan, 38 Phil 552

Felipe vs. Heirs of Aldon, 120 SCRA 628 (1983)
House Intl. vs. IAC, 151 SCRA 703
HSBC vs. Pauli, 161 SCRA 634
Fule vs. CA, 286 SCRA 698
MWSS vs. CA, 287 SCRA 95
Gulang vs. CA, 291 SCRA 66

PNB vs. CA, 94 SCRA 357

Miguel vs. Catalino, 26 SCRA 243
Kalalo vs. Luz, 34 SCRA 337
Dela Cruz vs. Paras, 69 SCRA 556

Trusts > Art. 1440 to 1457

1.
2.
3.

Fabian vs. Fabian, 22 SCRA 231

Bueno vs. Reyes, 27 SCRA 1179
Salao vs. Salao, 70 SCRA 65

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END