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Part Three:

1. False. The effect of demand upon an obligation

is not to make the obligation due but to put the debtor in
delay, save in certain cases where demand is not necessary in
order that delay may exist. Also, a demand presupposes that
an obligation is already due. A demand made upon an
obligation which is not yet due is not valid and will not put
the debtor in delay.
In addition, as to when an obligation becomes due is
not dependent on the existence of demand but on the kind of
obligation. For example, a pure obligation and those subject
to a resolutory condition or period are demandable at once.
On the other hand, obligations subject to a suspensive term
or period is demandable only when the condition is fulfilled
or upon the arrival of the period. (7)
2. False. The statement is true only with respect to
obligations subject to a suspensive condition, in
which case the (efficacy) of the obligation is suspended until
the happening of the suspensive condition or the arrival of
the suspensive period.
However, in obligations subject to a
resolutory condition or resolutory period, the
happening of the condition or the arrival of the period
extinguishes the obligation. The effect in this case is the
exact opposite of obligations subject to a suspensive
condition or term. (4)
3. False. That no person shall be responsible
for those events which could not be foreseen, or
which though foreseen, were inevitable is a
statement of a general rule.
However, other than an express stipulation to the
contrary, there are other well-known exceptions. Among
those exceptions are when the law otherwise provides, when
the nature of the obligation requires the assumption of risks,
when the debtor is guilty of delay and when he has promised
to deliver the same thing to two or more persons who do not
have the same interest.
In addition, in case of loss of the thing, the general rule
only applies to the loss due to a fortuitous event of a
determinate thing under the principle that genus never
perishes. (6)
4. False. It is submitted that the rule that the value
of the currency at the time of the constitution of the
obligation shall be the basis of payment in case of
extraordinary inflation or deflation applies only to
obligations arising from contracts. This is because the New

Civil Code refers to the extraordinary inflation or deflation of

the currency stipulated by the parties thereby presupposing
that a contract was entered into between them.
obligations arising from law, it is the provisions of the law
imposing the obligation that should govern. (6)
Part Four:
1. C is correct.
Under the Civil Code, the
concurrence of two or more debtors in one and the same
obligation does not mean that each one of them is bound to
render entire compliance with such obligation giving rise to a
solidary liability. There is solidarity only when the parties
so stipulate or when the law or the nature of the obligation
requires solidarity.
Since the parties did not agree that the liability of A, B
and C shall be solidary and neither does the law nor the
nature of the obligation requires it, the obligation of A, B and
C for the payment of telephone bills shall only be joint. In
case of joint obligation, there are as many debts as there are
debtors and each one of the debtors is liable only for his own
share. In the absence of any stipulation, the share of the
joint debtors is equal.
Applying the above in the instant case, it is clear that
in dividing the PhP 30,000 debt among the joint debtors
equally, C can only be held liable for one-third of such debt.
2. Y Bank is correct as there is here a case of legal
Under the Civil Code, for there to be legal
compensation, the following requisites must concur: a)
the parties are in their own right debtors and creditors of
each other; b) that the parties are principally bound by the
obligation; c) that both debts consist of a sum of money or if
they be consumable things, they are of the same kind or
quality; d) that both debts must be due; e) that both debts
are demandable and liquidated; f) that there is no retention
or controversy commenced by third persons over either
debts and communicated in due time to the obligor; and g)
that compensation is not prohibited by law.
In the instant case, X alleges that compensation is
improper because one of the debts arises from a deposit. It
appears that he anchors his position on the absence of the
first requisite that is the parties must be debtors and
creditors of each other in their own right. This contention of
X is untenable.

Under the Civil Code, deposit of money in a bank shall

be governed by the contract of loan. The relationship
between the bank and depositor is that of a creditor-debtor
relationship with the bank being a creditor to the extent of
the amount deposited. Thus, the first requisite has been
Since all the requisites for compensation is present,
compensation took place by operation of law and the debt
must be extinguished to the extent of PhP 800,000. (6)
3. a) A may be compelled to pay PhP 200,000,
which is the share of A and B.
Under the Civil Code, in the absence of stipulation, the
share of each solidary debtors among themselves is equal.
Hence, A, B and C is liable for PhP 100,000 each among
themselves. The condonation by the creditor of C's hare in
the obligation resulted to the extinguishment of that part
only of the obligation, leaving the balance of PhP 200,000 in
Since the obligation of A, B and C is solidary, the
creditor may demand from any of the solidary debtors entire
compliance with the obligation which in this case pertains to
the PhP 200,000 which has not been condoned. If A pays,
he may demand reimbursement form B only since the share
of C has been remitted.
b) The creditor may compel A to pay the entire
obligation even if C became insolvent.
A, B and C are solidary debtors. In the case of a
solidary obligation, each one of the solidary debtors is bound
to render entire compliance with the obligation. Hence, the
creditor need not proceed against all of them although he
may do so if he wishes. The fact that C is insolvent is not an
obstacle for the creditor to recover the entire debt from any
one of the solidary debtors.
In the event A makes payment, he may compel B to
contribute PhP 150,000. In the case of solidary obligation,
when one of the solidary debtors is insolvent, the others shall
be liable for his share in proportion to the debt of each. In
the absence of stipulation, the share of the solidary debtors is
equal. Hence, B can be compelled to contribute the PhP
100,000 pertaining to his share and additional PhP 50,000
as his share of Cs part of the debt. (12)
4. X is not correct. The rule is that conditional
obligation is void if the fulfilment of the condition depends

upon the sole will of the debtor because in this case, the
debtor can prevent the fulfilment of the condition,
preventing the obligation from taking effect. However, this
does not apply in the instant case.

other prestations, he shall be obliged to deliver it to

Benjamin without prejudice to Benjamins liability for the
destruction of the watch. (7)

First, the passing in the bar examination does not

depend upon the sole will of the person. If at all, it may be
said to depend partly on his will and on chance. Second, Y
here is not the debtor. Hence, even if we say that passing the
bar is a potestative condition, it will not render the obligation
void since it does not depend upon the sole will of the debtor
but of the creditor. Naturally, Y wold want the obligation to
be effective. (7)
5. a) As a third person who pays with the knowledge
and consent of the debtor, T may claim from D the amount
by which he pays which was PhP 50,000.
notwithstanding that the payment benefitted D only in the
extent of PhP 40,000 as he paid the first instalment already.
In addition, T may compel the creditor C to subrogate him in
Cs rights. Hence, in the event D is unable to pay T, T may
foreclose the chattel mortgage or Ds car.
The remedy of D is to recover the excess PhP 10,000
payment from the creditor C under the principle that no one
should unjustly enrich himself at the expense of another. (6)
b) The obligation in the instant case is an alternative
obligation since Aaron is alternatively bound to render
different prestations.
In alternative obligations, the
performance of one is sufficient compliance. In determining
which prestation to deliver however, the right of choice
belongs to the debtor unless expressly granted to the
In the instant case, since here is not express grant of
the right to choose to Benjamin, the right of choice belongs
to Aaron. The remedy of Aaron depends on whether he has
already communicated his choice to Benjamin at the time the
watch was destroyed due to Benjamins fault. If the watch
was destroyed before the choice was communicated to
Benjamin, Aaron may still choose to deliver the specific ring
or the specific necklace. However, if because of the
destruction of the watch, he is unable to make a choice
according to the terms of the obligation, Aaron may choose
to rescind the same with damages.
If, however, Benjamins destruction was after Aaron
has already chosen to deliver the watch, it is submitted that
the obligation is extinguished. If, however, Aaron chose the