OBLICON (Civil Law Review II)

1. JEIMUEL sold and delivered various items of merchandise to Awang amounting to

P200,000. When Awang failed to pay his obligation, JEIMUEL sued him for collection of sum
of money, but Awang filed an answer contending that there should be compensation with
his commission over the merchandise JEIMUEL sold and delivered to ROMAR, as it has
been the practice of JEIMUEL to deal with Awang first before he would deal with ROMAR. Is
the defense proper? Why?
2. ABC Corporation entered into a contract of loan with PBTC secured by a chattel mortgage.
When ABC Corporation failed to pay, the bank foreclosed the mortgage; but it was
objected to by the debtor contending that there was novation of the contract when it
executed a real estate mortgage when an extension of the loan was granted by the bank.
Is the contention of ABC Corporation correct? Why?
ANSWER: No. Novation takes place where the object or principal condition of an
obligation is changed or altered. Novation is never presumed; it must be explicitly stated
or there must be manifest incompatibility between the old and the new obligations in
every aspect. There is no incompatibility between the two contracts especially so that the
new contract was executed as an additional security to the chattel mortgage (PBTC v.
Sybels Inc. Aug. 11, 1989).
3. JEIMUEL and Awang entered into a contract. ROMAR executed a surety undertaking for
Awang, the debtor. JEIMUEL and Awang entered into an agreement changing the interest
rate. Is there a novation as to release ROMAR? Why?
ANSWER: There is no novation to release ROMAR. Novation of a contract is never
presumed. In the absence of an express agreement, novation takes place only when the
old and the new obligations are incompatible on every point.
4. JEIMUEL owes Awang the amount of P10,000.00 Withouts knowledge and consent, Awang
and ROMAR entered into an agreement whereby ROMAR assumed JEIMUELs obligation.
ROMAR, however, turned out to be insolvent. What is the effect of ROMARs insolvency in
relation to JEIMUELs obligation? Explain.
5. JEIMUEL borrowed money from Awang in the amount of P150,000.00. One morning, Awang
went to JEIMUEL and delivered to the latter the promissory note he issued to Awang. What
is the effect of such delivery? Explain.
ANSWER: The effect of such delivery is to liberate JEIMUEL from his indebtedness to
AWANG. Under the law, the delivery of a private document evidencing a credit, made
voluntarily by the creditor to the debtor, implies renunciation of the action which the
former had against the latter. (art 1271)
6. JEIMUEL, Awang and ROMAR bound themselves solidarily to pay A the amount of P5,000..
Suppose JEIMUEL paid the obligation, what is his right as against his co-debtors? Why?
ANSWER: JEIMUEL has a right to ask for reimbursement from AWANG and ROMAR. The law
substantially provides in part that he who made payment may claim from his co-debtors
the share which corresponds to each.
After payment of the debt by a solidary debtor, he in turn becomes the creditor of his codebtors for their shares of the debt.
7. JEIMUEL, Awang, and ROMAR bound themselves solidarily to pay A the sum of P10,000.
When the obligation became due and demandable, A sued JEIMUEL for the payment of the
P10,000. JEIMUEL moved to dismiss on the ground that there was failure to implead Awang
and ROMAR who are indispensable parties. Will the motion prosper? Why?

ANSWER: The motion to dismiss has no leg to stand on. The Court has held in a ruling
that the creditor may sue any of the solidary debtors or all of them simultaneously. An
action against one shall not be a bar to those which may be subsequently brought against
the others, as long as the debt has not been fully collected.
8. When may the court delete penalty clause? Explain.
9. JEIMUEL is indebted to Awang in the amount of P10,000 payable on or before December 1,
1991. In the contract, Awang agreed to be paid only to the extent of P5,000 when the
obligation is due. Unknown to JEIMUEL, ROMAR paid the amount of P10,000.00 to Awang.
Subsequently, ROMAR asked for reimbursement for the full amount of the obligation. Is
ROMARs action proper? Why?
10.What are the requisites of dacion en pago?
11.A delivered to B a solitaire ring for the latter to sell on commission basis. B failed to sell it
but could not return it either. She offered to return a diamond ring, but A refused, hence,
this suit to compel A to accept the same. If you were the judge, would you rule in favor of
B?
12.A and B entered into a contract of loan for P1,000,000 whereby B obligated himself to pay
A in U.S. dollars when the obligation becomes due and demandable. Is the stipulation
valid? Explain.
13.What is the effect if the check which was used as payment was a cashiers or managers
check? Is it going to constitute payment? Why?
ANSWER: The effect of payment by check, whether cashiers or managers check , would
be as if there was no payment made. The Court, in a case, held that
A check, whether a manager's check or ordinary check, is not legal tender, and an
offer of a check in payment of a debt is not a valid tender of payment and may be
refused receipt by the obligee or creditor.
The ruling in these two (2) cases merely applies the statutory provisions which lay down the rule that a check is not legal
tender and that a creditor may validly refuse payment by check, whether it be a manager's, cashier's or personal check.

14.What is the basic difference between tender of payment and consignation?

ANSWER: Tender of payment is the manifestation by the debtor of a desire to comply
with or pay an obligation. If refused without just cause, the tender of payment will
discharge the debtor of the obligation to pay but only after a valid consignation of the sum
due shall have been made with the proper court.32 Consignation is the deposit of the
[proper amount with a judicial authority] in accordance with rules prescribed by law, after
the tender of payment has been refused or because of circumstances which render direct
payment to the creditor impossible or inadvisable.
15.JEIMUEL promised to deliver to B a car with plate no. 111 provided that he passes the bar
examination. The car was lost because of a fortuitous event without his fault. If B passes
the bar, can he compel JEIMUEL to deliver the car? Why?
ANSWER: B cannot compel JEIMUEL to deliver the car because the obligation is to deliver
a specific thing. As such, under the law, in an obligation to deliver a determinate thing,
the debtor not in delay is released if the object is lost or destroyed without his fault. The
reason being is that it becomes physically impossible for the debtor to perform his
obligation as the specific thing has already been lost or destroyed.
16.A jeepney carrying passengers turned turtle because one of its tires blew out. One of the
passengers died; hence, the heirs filed a suit for damages. The owner of the jeep filed an
answer contending that the cause of the accident was a fortuitous event. Decide.

ANSWER: The contention of the owner of the jeep that a fortuitous event exempts him
from liability is not correct. The Court has ruled in a case that a common carrier may not
be absolved from liability in case of force majeure or fortuitous event alone. The common
carrier must still prove that it was not negligent in causing the death or injury resulting
from an accident.
17.JEIMUEL is indebted to Awang in the amount of P50,000, payable in ten (10) monthly
installments and with interest at 30% per annum. What is the effect if Awang would be
receiving payment of the principal without receiving first the interest? Explain.
ANSWER: The presumption would be that AWANG had already received payment of the
interest because under the law, normally the interest is paid ahead of the principal.
18.The contract between A and B provides:
That the term or period of this contract shall be as long as the party of the first
part has need for the electric light posts of the party of the second part.
Is the contract valid? Why?
19.JEIMUEL sold and delivered a car to Awang with the agreement that after five days, Awang
would pay the amount of P200,000 to JEIMUEL. JEIMUEL filed an action for rescission of the
contract on the ground that Awang failed to pay the price. Will the action prosper? Why?
20.JEIMUEL is indebted to Awang in the amount of P100,000 payable on or before December
31, 1992. On December 10, 1992, he gave an extension to JEIMUEL until January 30, 1993.
Another extension was granted in February 1993 and two extensions more were given up
to March 1993. When JEIMUEL asked for another extension, Awang refused and asked you
whether he can still exercise his reserved right of rescission. Advise Awang.
ANSWER: I would advise AWANG that he can either ask JEIMUEL to pay or to seek the
rescission of the contract.
Art. 1191 of the Civil Code provides, in part, that 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.
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