Oblicon Semi Finals

MEANING OF PAYMENT.
CONDONATION OR REMISSION
In ordinary parlance, payment refers only to the This is essentially gratuitous and requires the
delivery of money. As a legal mode of extinguishing an acceptance by the obligor. It may be made expressly or
obligation, it has a much wider meaning. Payment may impliedly. One and the other kind shall be subject to the
consist of not only the delivery of money but also the rules which govern officious donations. Express
giving of a thing (other than money), the doing of an condonation shall, furthermore, comply with the forms
act, or not doing of an act. When a debtor pays of donation. (1187) Meaning of condonation or
damages or penalty in lieu of the fulfilment of an remission. Condonation or remission is the gratuitous
obligation (see Art.1226.), there is also payment in the abandonment by the creditor of his against the debtor.
sense used in Article 1232. In law, payment and (4 Roman 422.) It is thus a form of donation.
performance are synonymous.
Requisites of condonation or remission.
WHEN A THING IS CONSIDERED LOST.
The requisites are the following:
1. It must be gratuitous; It must be accepted by the
It is understood that a thing is lost when it perishes or
obligor;
goes out of commerce or disappears in such a way
2. The parties must have capacity; It must not be
that its existence is unknown, or it cannot be
Inofficious; and
recovered. (Art.1189, par.2)
3. If made expressly, it must comply with the
Loss of a determinate thing under Article 1262 (par.1.) forms of donations. Art. 1275. The obligation is
is the equivalent of impossibility of performance in extinguished from the time the characters of
obligations to do referred to in Article 1266. But “loss of creditor and debtor are merged in the same
the thing due,” as used in Article 1231 (1) and the above person. (1192a) Meaning of confusion or
section subtitle, extends to both obligations to give and merger.
obligations to do.
CONFUSION OR MERGER
When loss of thing will extinguish an obligation to
This is the meeting in one person of the qualities of
give.
creditor and debtor with respect to the same obligation.
In order that an obligation may be extinguished by the (4 Sanchez Roman 421.)
loss of the thing, the following requisites must be
Requisites of confusion.
present:
1. For a valid confusion or merger to take place, it
1. The obligation is to deliver a specific or is necessary that:
determinate thing; 2. It must take place between the principal debt
2. The loss of the thing occurs without the fault of and creditor; and
the debtor; and 3. It must be complete.
3. The debtor is not guilty of delay.
COMPENSATION
When loss of thing will not extinguish liability.
Art. 1278. Compensation shall take place when two
There are cases, however, when the loss of the specific persons, in their own right, are creditors and debtors of
thing even in the absence of fault and delay will not each other. (1195)
exempt the debtor from liability. They are:
Meaning of compensation. Compensation is the
1. When the law so provides (Arts.1170, 1165 extinguishment to the concurrent amount of the
[par.3], 1263.); debts of two persons who, in their own right, are
2. When the stipulation so provides; debtors and creditors of each other. (Arts.1278, 1290.)
3. When the nature of the obligation requires the It involves the simultaneous balancing of two
assumption of risk (par.2; see Art.1174.); and obligations in order to extinguish them to the extent in
4. When the obligation to deliver a specific thing which the amount of one is covered by that of the other.
arises from a crime. (see Art.1268.) Art.1270. (8 Manresa 401.)
Requisites of legal compensation.
Article 1270 enumerates the requirements or requisites

for legal compensation.
1. The parties are principal creditors and principal
debtors of each other.
2. Both debts consist in a sum of money, or of
consumable things of the same kind and quality.
3. The two debts are due or demandable.
4. The two debts are liquidated.
5. No retention or controversy commenced by a
third person.
NOVATION
Art. 1291. Obligations may be modified by: Changing

their object or principal conditions; Substituting the
person of the debtor; Subrogating a third person in the
rights of the creditor. (1203)
Meaning of novation. Novation is the total and partial
extinction of an obligation through the creation of a
new one which substitutes it. It is the substitution or
change of an obligation by another, which extinguishes
or modifies the first, either by changing its object or
principal conditions, or by substituting another in place
of the debtor, or by subrogating a third person in the
rights of creditor. Art. 1292. In order that an obligation
may be extinguished by another which substitutes the
same, it is imperative that it be so declared in
unequivocal terms, or that the old and the new
obligations be on every point incompatible with each
other. (1204)
Requisites of novation.
In novation, there are four essential requisites, namely:

1. Existence of a previous valid obligation;
2. Capacity and intention of the parties to modify
or extinguish the obligation;
3. The modification or extinguishment of the
obligation; and
4. The creation of a new valid obligation.

Oblicon Semi Finals

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MEANING OF PAYMENT.

Article 1270 enumerates the requirements or requisites

Art. 1291. Obligations may be modified by: Changing

In novation, there are four essential requisites, namely:

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