Lecture 1 - Obligation and Contracts

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LECTURE 1: OBLIGATIONS AND CONTRACT

RA 386 – Obligation (Article 1156)


- An (Civil) OBLIGATION is a juridical necessity to give, to do, or not to do.
- Juridical necessity – in case of noncompliance, there will be legal consequences, sanctions, and
penalty.
- It does not cover Natural Obligations – obligations that cannot be enforces in court

4 ELEMENTS OF CIVIL OBLIGATIONS


1. Active Subject (creditor = obligee) – is the one (person) who is demanding the performing of the
obligation. It is he who is in his favor that the obligation is established.
2. Passive Subject (debtor = obligor) – bound to perform the obligation.
3. Object / Prestation – is not a thing, it is the particular conduct of the debtor.
4. Efficient Cause / Legal Tie / Juridical Tie – which binds or connects the parties to the obligation.
Note: If these are all present there’s Civil Obligation if not, then there is none.

SOURCES OF CIVIL OBLIGATION – Article 1157


1. Law Note: If there is no source of
2. Contracts (Oral or Written) obligations, then there are no
3. Quasi-contracts civil obligation and there will be
4. Delicts / Crimes / Felonies – acts or omissions punished by no legal sanctions.
(criminal) law
5. Quasi-delicts

EXAMPLE 1: (Unilateral – only one party has an obligation)


Contreras is the lender and Sir  Elements of Civil Obligation
Fidel is the borrower. The o Active Subject – Contreras (lender)
agreement they had is called o Passive Subject – Sir Fidel (borrower)
the Contract of Loan. Sir Fidel o Prestation – to pay back the loan
has the obligation to pay back o Efficient Cause – Contract of Loan
the loan while Contreras  Source of Obligation – Contract of Loan
doesn’t have any obligation.

EXAMPLE 2: (Bilateral – both parties have obligation)


Vierneza is the seller and Sir  Elements of Civil Obligation
Fidel is the buyer of cellphone. o Active Subject – Vierneza (seller); Sir Fidel (buyer)
The agreement they had is o Passive Subject – Sir Fidel (buyer); Vierneza (seller)
called the Contract of Sales. o Prestation – to transfer the ownership of the product; to
Vierneza (seller) has the pay for product
obligation to deliver or transfer o Efficient Cause – Contract of Sales
the ownership of the product  Source of Obligation – Contract of Sales
and Sir Fidel (buyer) has the
obligation to pay the purchase
price.
EXAMPLE 3: (Unilateral)
Sir Fidel lends his books to  Elements of Civil Obligation
Balosca. The agreement they o Active Subject – Sir Fidel (lender)
had is called Contract of o Passive Subject – Balosca (borrower)
Commodatum. Only the o Prestation – to return the borrowed book
Balosca (borrower) has the o Efficient Cause – Contract of Commodatum
obligation to return the book  Source of Obligation – Contract of Commodatum
while Sir Fidel (lender) has no
obligation.

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