Law 101 Syllabus

University of the Philippines
College of Law
2nd Semester 2014-2015
Law 101 OBLIGATIONS & CONTRACTS
Prof. Rommel J. Casis

Rm. 302, Malcolm Hall
Email: prof.casis@gmail.com
Consultation hours: Mon to Fri, 8 to 5 pm (except class hours) and by appointment
Course Description:
The law governing obligations their sources, kinds, nature, and effects; the law
governing contracts their creation, interpretation, modification, performance, and other
incidents; includes natural obligations, trusts, estoppel, extinctive prescription, and
compromise.
Grading System:
I. Recitation - 50 pts
This is determined by multiplying average recitation grades by 10.
II. Exam - 50 pts
This is determined by dividing final exam score by 2.
Conversion Table:
1 = 96 100 2.0 = 76 80 3 = 56 60
1.25 = 91 95 2.25 = 71 75 4 = 51 55
1.5 = 86 90 2.5 = 66 70 5 = 50 & below
1.75 = 81 85 2.75 = 61 65
Reference:
1
Law 101 Syllabus as of 22 May 2015
Tolentino, Commentaries and Jurisprudence on the Civil Code Vol. IV1
PART ONE
OBLIGATIONS
I. Concept and Sources
A. Concept, Elements and Transmissibility
Art. 1423
Art. 1156
Makati Stock Exchange, Inc. v. Campos, G.R. No. 138814, April 16,
20092
Ang Yu Asuncion v. CA G.R. No. 109125. December 2, 1994
Art. 1178
Stronghold Insurance Co., Inc. v. Republic-Asahi G.R. No. 147561, June
22, 2006
B. Sources of Obligations
Art. 1157
1. Law
Art. 1158
OSG v. Ayala Land, Inc., G.R. No. 177056, September 18, 2009
2. Contracts
Art. 1159
Art. 1305
3. Quasi-Contracts
Art. 1160
Art. 2142
4. Acts or Omissions Punished By Law
Art. 1161
1 The discussion of Tolentino on each assigned article is deemed included in the syllabus.
2 Cases in itals will not be discussed in full. Only the relevant rules and statements therein are important.
2
5. Quasi-Delicts
Art. 1162
Art. 2176
II.Nature and Effect
Art. 1156
II. Obligation to give
1. Obligation to deliver
Art. 1165
Art. 1244 par. 1
2. Obligation to take care of thing
Art. 1163
3. Obligation to deliver of fruits
Art. 1164
4. Obligation to deliver accessions and accessories
Art. 1166
B. Obligation to do
Art. 1167
C. Obligation not to do
Art. 1168
III.Non-Performance of Obligations
A. Kinds of Non-Performance
Art. 1170
1. Delay
Art. 1169
3
Cetus Development v. CA G.R. No. 77647. August 7, 1989
RCBC v. CA G.R. No. 133107. March 25, 1999
Aerospace v. CA G.R. No. 108129. September 23, 1999
Santos v. Santos G.R. No. 153004. November 4, 2004.
2. Fraud
Art. 1171
Legaspi Oil Co., Inc. v. Court of Appeals, G.R. No. 96505, July 01, 1993
International Corporate Bank v. Gueco G.R. No. 141968. February 12,
2001
Woodhouse v. Halili G.R. No. L-4811. July 31, 1953
Geraldez v. CA 108253. February 23, 1994
3. Negligence
Arts. 1172 1173

Picart v. Smith
4. Contravention of the Tenor
Art. 1170
Art. 1167
Arrieta v. NARIC G.R. No. L-15645. January 31, 1964
Chavez v. Gonzales G.R. No. L-27454. April 30, 1970
B. Effect of Fortuitous Events
Art. 1174
Art. 1165 par. 3, Art. 552 par. 2, Art. 1942, Art. 1979, Art. 2001, Art.
2147
Tanguilig v. CA G.R. No. 117190. January 2, 1997
Nakpil & Sons v. CA G.R. No. L-47851. October 3, 1986.
Dioquino v. Laureano G.R. No. L-25906. May 28, 1970.
Austria v. CA G.R. No. L-29640. June 10, 1971.
Phil. Communications v. Globe G.R. No. 147324. May 25, 2004
C. Subsidiary Remedies of Creditor
Art. 1177
Adorable v. CA G.R. No. 119466. November 25, 1999
Khe Hong Cheng v. CA G.R. No. 144169. March 28, 2001
IV. Kinds of Obligations
A. Pure or Conditional
4
1. Pure
Art. 1179
HSBC v. Spouses Broqueza, G.R. No. 178610, November 17, 2010
Villanueva v. St. Martin G.R. No. 156746 (Notice), July 23, 2014
2. Conditional
Article 1179
2. Kinds of Conditional Obligations
i. Suspensive or Resolutory
Arts. 1181, 1187-1188,

Gaite v. Fonacier G.R. No. L-11827. July 31, 1961
Gonzales v. Heirs of Thomas G.R. No. 131784. September 16, 1999
Art. 1189
Dela Torre v. Court of Appeals, G.R. No. 160088, 160565, July 13, 2011
Art. 1190
MCIAA v. Tudtud, G.R. No. 174012, November 14, 2008
ii. Potestative, Casual or Mixed
Art. 1182
Lim v. CA G.R. No. 87047. October 30, 1990.
Naga Telephone v. CA G.R. No. 107112. February 24, 1994
Rustan Pulp v. IAC G.R. No. 70789. October 19, 1992.
iii.Impossible
Art. 1183
Heirs of San Miguel v. Court of Appeals, G.R. No. 136054, September
05, 2001
iv. Positive or Negative
Arts 1184-1185
v. Reciprocal
Art. 1191
Ong v. CA G.R. No. 97347. July 6, 1999
5
Vda de Mistica v. Naguiat G.R. No. 137909. December 11, 2003
Cannu v. Spouses Galang G.R. No. 139523. May 26, 2005
Pryce Corp v. PAGCOR G.R. No. 157480. May 6, 2005
Deiparine v. CA G.R. No. 96643. April 23, 1993
Laperal v. Solid Homes G.R. No. 130913. June 21, 2005
U.P. v. De Los Angeles G.R. No. L-28602. September 29, 1970
Angeles v. Calasanz G.R. No. L-42283. March 18, 1985
Iringan v. CA G.R. No. 129107. September 26, 2001
Art. 1192
Yao v. Matela G.R. No. 167767. August 29, 2006
Ong v. Bagnalbal G.R. No. 149140. September 12, 2006.
b. Constructive Fulfillment
Art. 1186
Int'l. Hotel Corp. v. Joaquin, Jr., G.R. No. 158361, April 10, 2013
B. With a Period
1. Definition
Art. 1193
Solante v. COA, G.R. No. 207348, August 19, 2014
2. When courts may fix a period
Art. 1197
Araneta v. Phil Sugar G.R. No. L-22558. May 31, 1967
Macasaet v. Macasaet G.R. Nos. 154391-92. September 30, 2004
Art. 1180
3. Effect
Art. 1193
4. Beneficiary of Period
Art. 1196
LL and CO. v. Huang Chao G.R. No. 142378. March 7, 2002
5. When debtor loses right to make use of period
Art. 1198
6
6. In case of loss, deterioration or improvement of thing
Art. 1194
7. In case or premature payment / delivery
Art. 1195
C. Alternative and Facultative
1. Definition
Art. 1199
Arco Pulp and Paper Co., Inc. v. Lim, G.R. No. 206806, June 25, 2014
Art. 1206
2. Right to choose
Art. 1200
3. When debtors right to choose is lost
Article 1202
4. When choice effective
Art. 1201
5. When creditor makes choice impossible
Art. 1203
6. When creditor entitled to damages
Art. 1204
7. When creditor has right to choose
Art. 1205
D. Joint and Solidary
1. When solidary
Art. 1207
7
Inciong v. CA G.R. No. 96405. June 26, 1996
Arts 1210-1211
Lafarge Cement v. Continental Cement, G.R. No. 155173, November
23, 2004
2. When joint
Art. 1208
PH Credit v. CA G.R. No. 109648. November 22, 2001
3. Joint Indivisible Obligation
Art. 1209
4. Rights/Obligations of solidary creditors
a. Do useful and non-prejudicial acts
Art. 1212
Quiombing v. CA G.R. No. 93010. August 30, 1990
b. Not assign rights
Art. 1213
5. Who debtor must pay
Art. 1214
6. When solidary creditor extinguishes obligation
Art. 1215
7. Who creditor may proceed against
Art. 1216
PNB v. Independent Planters Ass'n, G.R. No. L-28046, May 16, 1983
8. Payment by solidary debtor
Art. 1217
Vigilla v. Philippine College of Criminology, Inc., G.R. No. 200094, June
10, 2013
Cruz v. Spouses Basister, G.R. No. 196576, January 30, 2012
Escao v. Ortigas, Jr., G.R. No. 151953, June 29, 2007
8
Art. 1218
Diamond Builders n v. Country Bankers, G.R. No. 171820, December
13, 2007
9. Remission by creditor
Arts. 1219-1220
10. When extinguished
Art. 1221
11. Defenses of solidary debtors
Art. 1222
Ouano Arrastre Service, Inc. v. Aleonar, G.R. No. 97664, October 10,
1991
E. Divisible and Indivisible
1. Divisibility and Indivisibility of Things
Art. 1223
Art. 1225
Capalla v. COMELEC, G.R. No. 201112, 201121, 201127, 201413,
October 23, 2012
2. Joint indivisible obligation
Art. 1224
F. With a Penal Clause
1. Purpose of Penalty
Arts. 1226
Cabarroguis v. Vicente, G.R. No. L-14304, March 23, 1960
Filinvest Land Inc. v. Court of Appeals, G.R. No. 138980, September 20,
2005
Country Bankers v. CA G.R. No. 85161. September 9, 1991
Pamintuan v. Court of Appeals, G.R. No. L-26339, December 14, 1979
Art. 1227
Art. 1228
9
2. When courts may reduce
Art. 1229
Makati Development v. Empire G.R. No. L-21780. June 30, 1967
Filinvest Land Inc. v. Court of Appeals, G.R. No. 138980, September 20,
2005
Florentino v. Supervalue G.R. No. 172384. September 12, 2007
3. Effect of Nullity
Art. 1230
V. Extinguishment of Obligations
Art. 1231
A. Payment or Performance
1. In general
a. Definition
Art. 1232
b. Requirements
Art. 1233
c. Substantial performance
Art. 1234
Int'l. Hotel Corp. v. Joaquin, Jr., G.R. No. 158361, April 10, 2013
d. Incomplete/Irregular Performance
Art. 1235
Esguerra v. Villanueva, G.R. No. L-23191, December 19, 1967
Pagsibigan v. CA G.R. No. 90169. April 7, 1993
e. Partial Prestations
Art. 1248
Barons Marketing Corp. v. Court of Appeals, G.R. No. 126486, February
09, 1998
10
f. Payment by 3rd Party
Art. 1236
Spouses Publico v. Bautista, G.R. No. 174096, July 20, 2010
Art. 1237
Carandang v. De Guzman G.R. No. 160347. November 29, 2006
Art. 1238
Moreo-Lentfer V. Jurgen Wolff G.R. No. 152317. November 10, 2004
g. Incapacity to Pay
Art. 1239
h. Payment recipient
Art. 1240
Cembrano v. City of Butuan G.R. No. 163605. September 20, 2006
i. Payment to Incapacitated/Third Person
Art. 1241
Valarao v. Court of Appeals, G.R. No. 130347, March 03, 1999
j. Payment to Possessor of Credit
Art. 1242
Orata v. Intermediate Appellate Court, G.R. No. 73471, May 08, 1990
k. Payment after judicial order to retain
Art. 1243
l. Substitution of Prestation
Art. 1244
m.Dation in Payment
Art. 1245
Tan Shuy v. Spouses Maulawin, G.R. No. 190375, February 08, 2012
Philippine Lawin v. CA G.R. No. 130972. January 23, 2002
n. Same quality
11
Art. 1246
o. Extrajudicial Expenses
Art. 1247
p. Payment currency and value
Art. 1249 par. 1

Union Bank v. Sps. Tiu G.R. Nos. 173090-91. September 7, 2011
Art. 1250
Telengtan Brothers v. United States G.R. No. 132284. February 28,
2006
Citibank v. Sabeniano G.R. No. 156132. February 6, 2007
Equitable PCI v. Ng Sheung G.R. No. 171545. December 19, 2007
q. Payment in Negotiable Instruments
Art. 1249 par 2 & 3

Papa v. Valencia G.R. No. 105188. January 23, 1998
Philippine Airlines v. CA G.R. No. 49188. January 30, 1990
Tibajia, Jr. v. CA G.R. No. 100290, June 04, 1993
r. Interest and Installments
Art. 1176
Art. 1175
s. Payment Place
Art. 1251
2. Application of Payments
Art. 1252
Liggett & Myers v. Associated Insurance G.R. No. L-15643, October 31,
1960
Premiere Development v. Central Surety, G.R. No. 176246, February 13,
2009
Art. 1253
Magdalena Estates, Inc. v. Rodriguez, G.R. No. L-18411, December 17,
1966
Art. 1254
12
Paculdo v. Regalado G.R. No. 123855. November 20, 2000
3. Payment by Cession
Art. 1255
DBP v. CA G.R. No. 118342. January 5, 1998.
4. Tender of Payment and Consignation
a. Effect
Art. 1256
Meat Packing v. Sandiganbayan G.R. No. 103068. June 22, 2001
Spouses Cinco v. Court of Appeals, G.R. No. 151903, October 09, 2009
Llobrera v. Fernandez G.R. No. 142882. May 2, 2006
Art. 1260 par. 1
b. Requirements
Arts. 1257-1258
Soco v. Militante G.R. No. L-58961. June 28, 1983
c. Expenses
Art. 1259
d. Withdrawal
Art. 1260 par. 2

Pabugais v. Sahijwani G.R. No. 156846. February 23, 2004
Art. 1261
B. Loss of the Thing Due
1. When loss extinguishes
Arts 1262 par 1

Art. 1266
PNCC v. CA G.R. No. 116896. May 5, 1997
2. When loss does not extinguish
Art. 1262 par. 2

Art. 1263
13
Gaisano v. Insurance Company G.R. No. 147839. June 8, 2006
Art. 1268
3. Partial loss
Art. 1264
4. Presumption of Fault
Art. 1265
Jimmy Co v. CA G.R. No. 124922. June 22, 1998
5. Unforeseen Difficulty
Art. 1267
Occena v. CA G.R. No. L-44349. October 29, 1976
Naga Telephone v. CA G.R. No. 107112. February 24, 1994
6. Creditors Rights
Art. 1269
C. Condonation or Remission of Debt
1. Nature and Requisites
Art. 1270
Yam v. CA G.R. No. 104726. February 11, 1999
2. Implied renunciation
Art. 1271
Trans-Pacific v. CA G.R. No. 109172. August 19, 1994
Art. 1272
3. Renunciation of Accessory Obligations
Arts. 1273-1274
D. Confusion or Merger of Rights
Art. 1275
Valmonte v. Court of Appeals, G.R. No. L-41621, February 18, 1999
14
Art. 1276
Art. 1277
E. Compensation
1. General Rules
a. Definition
Art. 1278
Bangko Sentral v. COA G.R. No. 168964. January 23, 2006
b. Nature and Effect
Art. 1281
Art. 1286
Art. 1290
Trinidad v. Acapulco, G.R. No. 147477, June 27, 2006
c. Requisites
Art. 1279
Silahis Marketing v. IAC G.R. No. 74027. December 7, 1989
Trinidad v. Acapulco G.R. No. 147477. June 27, 2006
Art. 1282
United Planters v. Court of Appeals, G.R. No. 126890, April 02, 2009
d. Order of compensation
Art. 1289
2. Specific scenarios
a. When applicable
i. in favor of guarantor
Art. 1280
ii. in claim for damages
Art. 1283
iii.rescissible/voidable debts
15
Art. 1284
iv. assignment before compensation
Art. 1285
Perez v. Court of Appeals, G.R. No. L-56101, February 20, 1984
b. When not applicable
i. In case of deposit
Art. 1287
ii. In case of civil liability arising from penal offense
Art. 1288
Metrobank v. Tonda, G.R. No. 134436, August 16, 2000
F. Novation
1. Kinds of Novation
Art. 1291
Conchingyan v. RB Surety G.R. No. L-47369. June 30 1987
California v. State Investment G.R. No. 147950. December 11, 2003
Ong v. Bognalbal G.R. No. 149140. September 12, 2006
Millar v. CA G.R. No. L-29981. April 30, 1971
2. Requisites
Art. 1292
Rillo v. Court of Appeals, G.R. No. 125347, June 19, 1997
Cruz v. Court of Appeals, G.R. No. 126713, July 27, 1998
Spouses Reyes v. BPI Family, G.R. Nos. 149840-41, March 31, 2006
3. Expromision and Delegacion
Art. 1293
Garcia v. Llamas G.R. No. 154127. December 8, 2003
a. Consequence of Expromision
Art. 1294
b. Consequence of Delegacion
16
Art. 1295
4. Effect on Accessory Obligations
Art. 1296
5. Void Obligations
Art. 1297
Art. 1298
6. Conditional Obligations
Art. 1299
7. Kinds of Subrogation
Art. 1300
Ledonio v. Capitol Development Corp., G.R. No. 149040, July 04, 2007
a. Conventional
Art. 1301
b. Legal
Art. 1302
Astro Electronics v. Philippine Export G.R. No. 136729. September 23,
2003
Metrobank v. Rural Bank of Gerona, Inc., G.R. No. 159097, July 05, 2010
8. Effect of Subrogation
Art. 1303
9. Partial subrogation
Art. 1304
IV. Natural Obligations
A. Definition
Art. 1423
Ansay v. Board of Directors, G.R. No. L-13667, April 29, 1960
17
B. Kinds
1. Performance after prescription
Arts. 1424-1425
2. Contracts of Minors
Arts. 1426-1427
3. Performance by winning party
Art. 1428
4. Payment beyond inheritance
Art. 1429
5. Payment of void legacy
Art. 1430
18
PART TWO
CONTRACTS
I. General Provisions
A. Definition
Art. 1305
Gateway v. Land Bank G.R. Nos. 155217 and 156393. July 30, 2003
B. Characteristics
1. Limitation on Stipulation
Art. 1306
Gabriel v. Monte de Piedad G.R. No. 47806. April 14. 1941
Pakistan International v. Ople G.R. No. 61594. September 28, 1990
Rivera v. Solidbank G.R. No. 163269. April 19, 2006
2. Binding Effect
a. In general
Art. 1308
GF Equity v. Valenzona G.R. No. 156841. June 30, 2005
Floirendo v. Metrobank G.R. No. 148325. September 3, 2007
Allied Banking Corp. v. Court of Appeals, G.R. No. 124290, January 16,
1998
Art. 1311 par. 1

DKC Holdings v. CA G.R. No. 118248. April 5, 2000
b. In case of stipulation in favor of third party
Art. 1311 par. 2

Florentino v. Encarnacion G.R. No. L-27696 September 30, 1977
Limitless Potentials v. Quilala G.R. No. 157391. July 15, 2005
c. In case of contracts creating real rights
Art. 1312
19
d. In case of creditors
Art. 1313 (cf 1381 (3))
3. Determination of Validity/ Compliance/Performance
Art. 1308
Art. 1309
Art. 1310
4. Perfection
a. In general
Art. 1315
b. In real contracts
Art. 1316
5. Authority to Contract
Art. 1317
6. Inducement to violate
Art. 1314
Gilchrist v. Cuddy G.R. No. 9356. February 18, 1915
Daywalt v. Corporacion G.R. No. 13505. February 4, 1919.
So Ping Bun v. CA G.R. No. 120554. September 21, 1999
Lagon v. CA G.R. No. 119107. March 18, 2005
II. Essential Requisites
Art. 1318
Francisco v. Pastor Herrrera G.R. No. 139982. November 21, 2002
A. Consent
1. When there is consent
Art. 1319
20
Insular Life v. Asset Builders Corp., G.R. No. 147410, February 05,
2004
Sps. Paderes v. Court of Appeals, G.R. No. 147074, 147075, July 15,
2005
a. Offer
i. Requisites for a valid offer
Art. 1319
ii. If made through an agent
Art. 1322
iii. In case of death, civil interdiction, insanity or insolvency
Art. 1323
Villanueva v. Court of Appeals, G.R. No. 114870, May 26, 1995
iv. When validly withdrawn
Art. 1324
Sanchez v. Rigos G.R. No. L-25494. June 14, 1972
Serra v. Court of Appeals, G.R. No. 103338, January 04, 1994
Tuazon v. Del Rosario-Suarez, G.R. No. 168325, December 13, 2010
v. Advertisements
Arts. 1325-1326
Jardine Davies v. CA G.R. No. 128066. June 19, 2000
Gutierrez v. Insular Life G.R. No. L-9832, November 29, 1957
b. Acceptance
i. Requisites for a valid acceptance
Art. 1319
Malbarosa v. CA G.R. No. 125761. April 30, 2003
ii. Manner
Art. 1320
iii. Right of Offeror to Fix
21
Art. 1321
2. Capacity to Give Consent
Art. 1327
Francisco v. Herrera, G.R. No. 139982, November 21, 2002
Art. 1328
Art. 1329
3. Vices of Consent
Art. 1330
a. Mistake
i. Kinds
Art. 1331
Spouses Theis v. CA G.R. No. 126013. February 12, 1997
ii. In case of illiteracy/unknown language
Art. 1332
Hemedes v. CA G.R. No. 107132. October 8, 1999
Leonardo v. CA G.R. No. 125485. September 13, 2004
iii. No mistake
Art. 1333
Domingo Realty v. CA G.R. No. 126236. January 26, 2007
iv. In case of mutual error
Art. 1334
b. Violence / Intimidation
i. Definition
Art. 1335
De Leon V. CA G.R. No. 80965. June 6, 1990.
Callanta v. NLRC G.R. No. 105083. August 20, 1993
ii. If via 3rd Person

22
Art. 1336
c. Undue Influence
Art. 1337
Alcasid v. CA G.R. No. 104751. October 7, 1994
Loyola v. CA G.R. No. 115734. February 23, 2000.
d. Fraud / Misrepresentation
i. Definition
Art. 1338
Spouses Tiongson v. Emergency Pawnshop G.R. No. 167874, January
15, 2010
ii. Requisites
Art. 1344
Tankeh v. DBP, G.R. No. 171428, November 11, 2013
ECE Realty v. Mandap, G.R. No. 196182, September 01, 2014
iii. Failure to disclose
Art. 1339
Rural Bank v. CA G.R. No. 110672. September 14, 1999
Escudero v. Flores, G.R. No. L-7401, June 25, 1955
iv. Usual exaggeration in trade
Art. 1340
v. Expression of opinion
Art. 1341
vi. By 3rd person
Art. 1342
vii. In good faith
Art. 1343
4. Simulation
23
a. Types
Art. 1345
b. Effect
Art. 1346
Manila Banking v. Silverion G.R. No. 132887. August 11, 2005
Valerio v. Refresca G.R. No. 163687. March 28, 2006
B. Object
Arts. 1347-1349
JLT Agro v. Balansag G.R. No. 141882. March 11, 2005
Domingo Realty v. CA G.R. No. 126236. January 26, 2007
C. Cause
1. Kinds
Art. 1350
2. Distinguished from motive
Art. 1351
3. Want of cause
Art. 1352
4. Statement of False Cause
Art. 1353
5. Presumed lawful cause
Art. 1354
6. Inadequacy of cause
Art. 1355
III. Form of Contracts
Arts. 1356-1358
24
Dauden-Hernaez v. De Los Angeles G.R. No. L-27010. April 30, 1969
Lim v. Court of Appeals, G.R. No. 102784, February 28, 1996
Cenido v. Spouses Amadeo G.R. No. 132474. November 19, 1999
IV. Reformation of Instruments
A. When proper
1. In general
Art. 1359
Quiros v. Arjona, G.R. No. 158901, March 09, 2004
Multi-Ventures v. Stalwart G.R. No. 157439. July 4, 2007
Rosello-Bentir v. Leanda G.R. No. 128991. April 12, 2000.
2. Mutual Mistake
Art. 1361
3. Mistake by one
Arts. 1362-1363
4. Error in drafting
Art. 1364
5. Severe pacto de retro
Art. 1365
Veluz v. Veluz, G.R. No. L-23261, July 31, 1968
B. When improper
Art. 1366
Art. 1368
C. Who may order
Art. 1368
D. Governing law
Art. 1360
Art. 1369
25
V. Interpretation of Contracts
A. Intent governs
Art. 1370
Abad v. Goldloop G.R. No. 168108. April 13, 2007
Benguet Corp. v. Cabildo, G.R. No. 151402, August 22, 2008
Art. 1371
Nielson & Co., Inc. v. Lepanto, G.R. No. L-21601, December 17, 1966
Art. 1372
Ong Lim Sing, Jr. v. FEB Leasing & Finance Corp., G.R. No. 168115, June
08, 2007
B. Interpreted to be effectual
Art. 1373
SM Land, Inc. v. BCDA G.R. No. 203655, August 13, 2014
C. Interpreted together
Art. 1374
Caete v. San Antonio, G.R. No. L-51152, 55440, April 27, 1982
Mendoza v. Court of Appeals, G.R. No. 116216, June 20, 1997
HDMF v. Court of Appeals, G.R. No. 118972, April 03, 1998
D. Interpreted according to nature and object of contract
Art. 1375
E. Interpreted according to usage and custom
Art. 1376
Chua v. Court of Appeals, G.R. No. 119255, April 09, 2003
F. Interpreted not in favor of party causing obscurity
Art. 1377
Horrigan v. Troika Commercial Inc., G.R. No. 148411, November 29,
2005
G. Interpreted according to Rules of Court
Art. 1379
26
H. When principles cant settle doubts
Art. 1378
VI. Defective Contracts
A. Rescissible Contracts
1. Basis
Art. 1380
Guzman v. Bonnevie G.R. No. 86150. March 2, 1992
2. Types of Rescissible Contracts
Art. 1381
Congregation of the Religious v. Orola, G.R. No. 169790, April 30, 2008
a. Contracts with lesion
Art. 1381 (1) and (2)
b. Contracts in fraud of creditors
Art. 1381 (3)

Siguan v. Lim G.R. No. 134685. November 19, 1999
Caltex (Phil.), Inc. v. PNOC Shipping, G.R. No. 150711, August 10, 2006
Holcim Philippines, Inc. v. Losloso, G.R. No. 203871, January 15, 2014
i. Presumption of Fraud
Art. 1387
China Banking v. CA G.R. No. 129644. March 7, 2000
Provincial Sheriff v. Court of Appeals, G.R. No. L-25152, February 26,
1968
ii. Liability of transferors
Art. 1388
c. Contracts referring to things under litigation
Art. 1381 (4)

Ada v. Baylon, G.R. No. 182435, August 13, 2012
d. Contracts subject to rescission by operation of law

27
Art. 1381 (5)
Malicsi v. Carpizo, G.R. No. L-17493, June 30, 1962
e. Payment made when insolvent
Art. 1382
3. Limitations on rescission
a. Subsidiary
Art. 1383
b. To extent of damage
Art. 1384
Siguan v. Lim, G.R. No. 134685, November 19, 1999
4. Effect of rescission
Art. 1385 par. 1
5. When rescission improper
Art. 1385
Art. 1386
6. Prescription of action
Art. 1389
Lalicon v. NHA, G.R. No. 185440, July 13, 2011
B. Voidable Contracts
1. Types and effect
Art. 1390
Francisco v. Herrera, G.R. No. 139982, November 21, 2002
Spouses Guiang v. Court of Appeals, G.R. No. 125172, June 26, 1998
Heirs of Ureta, Sr. v. Heirs of Ureta, G.R. No. 165748, 165930,
September 14, 2011
2. Ratification
a. Effect
28
Art. 1392
Art. 1396
b. Types
Art. 1393
c. By guardians
Art. 1394
d. Conformity not required
Art. 1395
3. Who may institute action for annulment
Art. 1397
Malabanan v. Gaw Ching, G.R. Nos. 74938-39, 75524-25, January 17,
1990
Baez v. CA, G.R. No. L-30351, September 11, 1974
4. Effect of annulment
a. Restoration
Art. 1398
Art. 1402
b. When restoration not required /possible
Arts. 1399-1400
5. Prescription / Extinguishment of action
Art. 1391
Art. 1401
C. Unenforceable Contracts
1. Types
Art. 1403
a. Unauthorized contracts
29
Art. 1403 (1)
Art. 1404
b. Contracts infringing statute of frauds
Art. 1403 (2)

Swedish Match v. CA G.R. No. 128120 October 20, 2004
Spouses Torcuator v. Spouses Bernabe G.R. No. 134219. June 8, 2005
Averia v. Averia G.R. No. 141877. August 13, 2004
Art. 1405
Art. 1406
c. Contracts where both parties are incapable of giving

consent
Art. 1403 (3)

Article 1407
2. Effect of being unenforceable
Art. 1403
Art. 1408
D. Void or Inexistent Contracts
1. Types and Effect
Art. 1409
Ching v. Goyanko, Jr., G.R. No. 165879, November 10, 2006
Art. 1422
E. Razon, Inc. v. Philippine Ports Authority, G.R. No. 75197, June 22,
1987
2. When divisible
Art. 1420
Spouses Litonjua v. L & R Corp., G.R. No. 130722, March 27, 2000
3. Recovery
a. When illegal and a crime
Art. 1411
30
Ramirez v. Ramirez G.R. No. 165088. March 17, 2006
b. When unlawful/forbidden but not a crime
Art. 1412
c. When validly repudiated
Art. 1414
Hulst v. P.R. Builders G.R. No. 156364. September 3, 2007
d. When one party is incapacitated
Art. 1415
e. When contract is not illegal per se but merely prohibited
Art. 1416
Frenzel v. Catito G.R. No. 143958. July 11, 2003
Acabal v. Acabal G.R. No. 148376. March 31, 2005
f. Of usurious interest
Art. 1413
Angel Jose v. Chelda Enterprises, G.R. No. L-25704, April 24, 1968
g. Of overprice
Art. 1417
h. When contract violates labor laws
Arts. 1418-1419
4. When illegality not a defense
Art. 1421
Heirs of Ureta, Sr. v. Heirs of Ureta, G.R. No. 165748, 165930,
September 14, 2011
Pascual v. Secretary of Public Works G.R. No. L-10405, December 29,
1960
5. No prescription
Art. 1410
Gallanosa v. Arcangel, G.R. No. L-29300, June 21, 1978
31
VII. Quasi-Contracts
A. Concept
Lao Chit v. Security Bank & Trust Co., G.R. No. L-11028, April 17, 1959
PNB v. CA and B.P. Mata G.R. No. 97995. January 21, 1993
PADCOM v. Ortigas G.R. No. 146807. May 9, 2002
B. Kinds
1. Negotiorum Gestio
Art. 2144
a. Standard of Diligence
Art. 2145
b. Effect of Delegation
Art. 2146
c. Liability of Managers
Art. 2146
d. Liability for Fortuitous events
Art. 2147-2148
e. Personal Liability
Art. 2152
f. Ratification / Enjoyment of Advantages
Arts. 2149-2151
g. Extinguishment
Art. 2153
2. Solutio Indebiti
32
Art. 2154
Andres v. Manufacturers Hanover G.R. No. 82670, September 15, 1989
Titan-Ikeda v. Primetown G.R. No. 158768. February 12, 2008
Metrobank v. Absolute Management Corp., G.R. No. 170498, January
09, 2013
a. Presumption of Mistake
Art. 2163
b. In case of doubt
Art. 2155-2156
c. Liability of payees
Art. 2157
d. Property belong to 3rd person
Art. 2158
e. Bad faith acceptance
Art. 2159
f. Good faith acceptance
Art. 2160
g. Reimbursement for improvements

Art. 2161
h. Exemption from obligation to restore
Art. 2162
3. Other Quasi Contracts
a. Support provided by stranger
Arts. 2164, 2166
b. Funeral Expenses
Art. 2165
33
c. Medical Service
Art. 2166
e. Saved property
Art. 2168
f. Government performs necessary work
Art. 2169
g. Commingling or confusion
Art. 2170
h. Lost personal property
Art. 2170
i. Possessor in good faith
Art. 2172
j. 3rd person pays debt
Art. 2173
k. Objector
Art. 2174
l. Paid tax of another
Art. 2175
34
PART THREE
ADDITIONAL TOPICS
I. Estoppel
Dizon v. Suntay, G.R. No. L-30817, September 29, 1972
Art. 1431
A. Elements
Kalalo v. Luz, G.R. No. L-27782, July 31, 1970

Philippine Bank of Communications v. CA, G.R. No. 109803, April 20,
1998
B. Kinds
Art. 1433
Spouses Co Chien v. Sta. Lucia Realty, G.R. No. 162090, January 31,
2007
Panay Electric Co., Inc. v. Court of Appeals, G.R. No. 81939, June 29,
1989
Pasion v. Melegrito, G.R. No. 166558, March 28, 2007
Spouses Chung v. Ulanday Construction, Inc., G.R. No. 156038,
October 11, 2010
Mendoza v. Court of Appeals, G.R. No. 116710, June 25, 2001
C. Persons Affected
Art. 1439
Spouses Hojas v. Philippine Amanah Bank, G.R. No. 193453, June 5,
2013
Republic v. Court of Appeals, G.R. No. 116111, January 21, 1999
D. Persons Estopped
1. Subsequent owner
Art. 1434
2. Agent
35
Art. 1435
3. Lessee/Bailee
Art. 1436
4. Owner of immovable guilty of fraud
Art. 1437
Bucoy v. Paulino, G.R. No. L-25775, April 26, 1968
5. Owner of personal property pledged by another
Art. 1438
E. Governing Law
Art. 1432
II. Trusts
Estate of Cabacungan v. Laigo, G.R. No. 175073, August 15, 2011

Morales v. Court of Appeals, G.R. No. 117228, June 19, 1997
A. Parties
Art. 1440
B. Kinds
Art. 1441
1. Express
a) Proof required
Art. 1443
Caezo v. Rojas, G.R. No. 148788, November 23, 2007
Ringor v. Ringor, G.R. No. 147863, August 13, 2004
b) Creation
Art. 1444
Ringor v. Ringor, G.R. No. 147863, August 13, 2004
Heirs of Labanon v. Heirs of Labanon, G.R. No. 160711, August 14,
2007
36
c) Non-acceptance by trustee
Art. 1445
d) Acceptance by beneficiary
Art. 1446
2. Implied
Estate of Cabacungan v. Laigo, G.R. No. 175073, August 15, 2011

a) When created
i. Trust from payment
Art. 1448
ii. Donee has part or no beneficial interest
Art. 1449
iii. Conveyance made to lender
Art. 1450
iv. Inheritance in trust
Art. 1451
Torbela v. Spouses Rosario, G.R. No. 140528, 140553, December 7,
2011
v. Title in one co-owner
Art. 1452
Mallilin, Jr. v. Castillo, G.R. No. 136803, June 16, 2000
vi. Trust based on promise
Art. 1453
vii. Trust to secure performance

37
Art. 1454
Heirs of Moreno v. Mactan-Cebu International Airport Authority, G.R.
No. 156273, October 15, 2003
viii. Investment of trust funds
Art. 1455
ix. Property acquired through mistake/fraud
Art. 1456
Aznar Brothers Realty Co. v. Aying, G.R. No. 144773, May 16, 2005
x. Non-exclusive
Art. 1447
Policarpio v. Court of Appeals, G.R. No. 116211, March 7, 1997
b) Proof required
Art. 1457
C. Governing Law
Art. 1442
Roa, Jr. v. Court of Appeals, G.R. No. L-27294, June 28, 1983
III. Compromises
A. Definition
Art. 2028
Cebu International Finance Corp. v. Court of Appeals, G.R. No. 123031,
October 12, 1999
AFP Mutual Benefit Association, Inc. v. Court of Appeals, G.R. No.
126745, July 26, 1999
B. Effect
Arts. 2036-2037
Adriatico Consortium, Inc. v. Land Bank, G.R. No. 187838, December
23, 2009
Manique v. Cayco, G.R. No. L-17059, November 29, 1965
Philippine Bank of Communications v. Echiverri, G.R. No. L-41795,
August 29, 1980
38
Republic v. Florendo, G.R. No. 166866, March 27, 2008
C. Role of the Court
Art. 2029
Arts. 2031- 2032
D. When civil action suspended
Art. 2030
E. Juridical persons
Art. 2033
Anacleto v. Van Twest, G.R. No. 131411, August 29, 2000
F. Effect on criminal action
Art. 2034
Trinidad v. Marcelo, G.R. No. 166038, December 4, 2007
G. Invalid compromises
Art. 2035
Dasalla, Sr. v. CFI of Nueva Ecija, Br. IV, G.R. No. 51461, April 26, 1991
H. When voidable
Art. 2038
I. Annulment or rescission
Art. 2039
J. Compromise after judgment
Art. 2040
Magbanua v. Uy, G.R. No. 161003, May 6, 2005
K. In case of breach
Art. 2041
Chavez v. Court of Appeals, G.R. No. 159411, March 18, 2005
Leonor v. Sycip, G.R. No. L-14220, April 29, 1961
Pasay City Government v. CFI, G.R. No. L-32162, September 28, 1984.
Province of Cebu v. Torres, G.R. No. 76950, December 15, 1988
39
IV. Extinctive Prescription
A. Definition
Art. 1106
Cutanda v. Heirs of Cutanda, G.R. No. 109215, July 11, 2000
De Morales v. CFI, G.R. No. L-52278, May 29, 1980
B. Against whom/ in whose favor
Arts. 1108-1111, 1114
C. Prescription of actions
Art. 1139
Antonio, Jr. v. Morales, G.R. No. 165552, January 23, 2007
1. Actions to recover movables
Art. 1140
2. Real actions over immovables
Art. 1141
3. Mortgage action
Art. 1142
4. Actions within 10 years
Art. 1144
Art. 1145
Art. 1146
Insurance of the Philippine Islands Corp. v. Spouses Gregorio, G.R. No.
174104, February 14, 2011
7. Actions within 1 year
Art. 1147
40
Alcantara v. Amoranto, G.R. No. L-12493, February 29, 1960
8. Other actions
Art. 1149
D. How counted
1. In general
Art. 1150
2. Obligations with interest
Art. 1151
3. Action to enforce judgment
Art. 1152
4. Action to demand accounting
Art. 1153
E. Effect of fortuitous event
Art. 1154
F. Interruptions
Art. 1155
Ledesma v. Court of Appeals, G.R. No. 106646 (Resolution), June 30,
1993
Intercontinental Broadcasting v. Panganiban, G.R. No. 151407,
February 06, 2007
Ramos v. Condez, G.R. No. L-22072, August 30, 1967
PNB v. Court of Appeals, G.R. No. L-27117, July 30, 1969
G. Rights which do not prescribe
Art. 1143
H. Governing law
Art. 1115
Art. 1148
41
42

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University of the Philippines

Law 101 OBLIGATIONS & CONTRACTS

Prof. Rommel J. Casis

This is determined by multiplying average recitation grades by 10.

II. Exam - 50 pts

This is determined by dividing final exam score by 2.

I. Concept and Sources

A. Concept, Elements and Transmissibility

4. Acts or Omissions Punished By Law

II.Nature and Effect

II. Obligation to give

2. Obligation to take care of thing

3. Obligation to deliver of fruits

4. Obligation to deliver accessions and accessories

Arts. 1172 1173

4. Contravention of the Tenor

B. Effect of Fortuitous Events

C. Subsidiary Remedies of Creditor

IV. Kinds of Obligations

2. Kinds of Conditional Obligations

Arts. 1181, 1187-1188,

ii. Potestative, Casual or Mixed

iv. Positive or Negative

2. When courts may fix a period

5. When debtor loses right to make use of period

7. In case or premature payment / delivery

C. Alternative and Facultative

3. When debtors right to choose is lost

4. When choice effective

5. When creditor makes choice impossible

6. When creditor entitled to damages

7. When creditor has right to choose

D. Joint and Solidary

3. Joint Indivisible Obligation

4. Rights/Obligations of solidary creditors

a. Do useful and non-prejudicial acts

b. Not assign rights

5. Who debtor must pay

6. When solidary creditor extinguishes obligation

7. Who creditor may proceed against

8. Payment by solidary debtor

10. When extinguished

11. Defenses of solidary debtors

E. Divisible and Indivisible

1. Divisibility and Indivisibility of Things

2. Joint indivisible obligation

F. With a Penal Clause

i. Payment to Incapacitated/Third Person

j. Payment to Possessor of Credit

k. Payment after judicial order to retain

p. Payment currency and value

Art. 1249 par. 1

q. Payment in Negotiable Instruments

Art. 1249 par 2 & 3

r. Interest and Installments

4. Tender of Payment and Consignation

Art. 1260 par. 1

Art. 1260 par. 2

B. Loss of the Thing Due

1. When loss extinguishes

Arts 1262 par 1

2. When loss does not extinguish

Art. 1262 par. 2

C. Condonation or Remission of Debt