MANUEL F.

ENVERGA UNIVERSITY FOUNDATION

College of Business and Accountancy
First Semester SY 2014-2015

A Course Guide on
OBLIGATIONS AND CONTRACTS
by Atty. Jose Maria Duhaylongsod

MODULE THREE
1


OBJECTIVE: This Module serves as an introduction to the Philippines law on contracts
by covering a comparison with commercial law, Constitutional Law and Public and
Private contracts, quasi-contracts and the Title on Contracts under the Civil Code. It will
explore the different stages of a contract, from its creation to its extinguishment.

I. Introduction to Contracts
A. General Provisions (Art. 1305)
1. Definition
a) Private and Public Contracts
2

b) vs. quasi contracts
3

2. Constitutional Protection
a) vs. franchises, licenses and grants
4

b) CASE: PAGCOR v. Thunderbird G.R. No. 197942-
43/G.R. No. 199528. March 26, 2014
3. Characteristics
a) Obligatory Force (Arts. 1159, 1315)
b) Mutuality (Arts. 1308-1310)
c) Relativity (Art. 1311)
(1) When binding only between parties
(2) When third persons may be affected (Arts. 1177,
1311 par. 2 1313)
(a) CASES:
(b) Quano v. CA 211 SCRA 740
(c) B.A. v. JAC 145 SCRA 419
(d) Timoteo Baluyot v. CA 311 SCRA 29
d) Autonomy of Will (Art. 1306)

(Semi-finals)

B. Elements of a Contract (Art. 1318)
1. Consent (Arts. 1319-1346)
a) Requirements
b) How manifested
(1) CASES:
(2) Villanueva v. CA 244 SCRA 395
(3) Bank of Commerce v. Manalo 482 SCRA 108
(4) Platinum Plans v. Cucueco 488 SCRA 156
(5) CLV Prefatory Discussions
5


1
Part IA: 28 August (02 September) 09 September 2014; Parts IB and II: 16 September 07 October
2014.
2
Fernandez, A Treatise on Government Contracts under Philippine Law at pp. 3-68
3
V Tolentino, The Civil Code of the Philippines at pp. 574 590
4
Bernas, The 1987 Constitution of the Republic of the Philippines at pp. 444 464
5
Villanueva, Commercial Law Review at pp. 1 -- 14
2
(a) Transfield Philippines, Inc. v. Luzon
Hydro Corporation et al., G.R. No. 146717, 22
November 2004
c) Options/ Right of First Refusal
(1) CASES:
(2) Adelfa Properties v. CA 240 SCRA 565
(3) Serra v. CA 229 SCRA 60
(4) Ang Yu v. CA 238 SCRA 602
(5) Riviera Filipina v. CA 380 SCRA 245
(6) JG Summit v. CA 450 SCRA 169
(7) Tanay Recreation v. Fausto 455 SCRA 436
d) Business advertisements
e) Bids
f) Simulated contracts
(1) Absolute v. Relative
(a) CASES:
(b) Dilag v. IAC 152 SCRA 459
(c) Robleza v. CA 174 SCRA 35
2. Object
3. Cause
a) CASES:
b) E. Razon v. PPA 155 SCRA 233
c) Olegario v. CA 238 SCRA 96
d) Pangadil v. CFI of Cotabato 116 SCRA 347
e) Antonia Torres v. CA 320 SCRA 428
f) Agan v. PIATCO 402 SCRA 612
4. Form of Contracts
a) CASES:
b) Clarin v. Relova 127 SCRA 512
c) Hechanova v. Adil 144 SCRA 450
5. Reformation of Instrument
a) CASES:
b) Huibonhoa v. CA 320 SCRA 625
c) National Irrigation Administration v. Gamit 215 SCRA
436
d) Naga Tel. Co., Inc. v. CA 230 SCRA 351
II. Defective Contracts
A. Rescissible
1. CASES:
2. Pryce Corp. v. PAGCOR 458 SCRA 164
3. China Banking Corp. v. CA 327 SCRA 378
4. Coastal Pacific Trading v. Southern Rolling 497 SCRA 11
5. Caltex Philippines v. PNOC Shipping 498 SCRA 400
6. Uy Tong v. Silva 132 SCRA 448
7. Floro Enterprises v. CA 249 SCRA 354
B. Voidable
1. Vices in consent
a) mistake
b) violence or intimidation
c) undue influence
d) fraud
3
(1) incidental
(2) causal
2. CASES:
3. Alcasid v. CA 237 SCRA 419
4. Cayabyab v. IAC 231 SCRA 1
5. Theis v. CA 268 SCRA 167
C. Unenforceable
1. CASES:
2. Badillo v. Ferrer 152 SCRA 407
3. Diwa v. Donato 234 SCRA 608
4. Litonjua v. Fernandez 427 SCRA 478
D. Void
1. CASES:
2. Ramirez v. Ramirez 485 SCRA 92
3. Frenzel v. Catito 406 SCRA 55
4. Menchavez v. Teves 449 SCRA 380
5. DBP v. CA 249 SCRA 331

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