Art. 1167. If a person obliged to do something fails to do it, the same shall be executed at his cost.

Art. 1169. Those obliged to deliver or to do something incur in delay from the time the obligee
judicially or extrajudicially demands from them the fulfillment of their obligation.

However, the demand by the creditor shall not be necessary in order that delay may exist:

(1) When the obligation or the law expressly so declare; or

(2) When from the nature and the circumstances of the obligation it appears that the
designation of the time when the thing is to be delivered or the service is to be rendered
was a controlling motive for the establishment of the contract; or

(3) When demand would be useless, as when the obligor has rendered it beyond his power
to perform.

In reciprocal obligations, neither party incurs in delay if the other does not comply or is not ready
to comply in a proper manner with what is incumbent upon him. From the moment one of the
parties fulfills his obligation, delay by the other begins

Art. 1191. 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.

This is understood to be without prejudice to the rights of third persons who have acquired the
thing, in accordance with Articles 1385 and 1388 and the Mortgage Law.

Reciprocal obligations are those created or established at the same time, out of
the same cause, and which results in a mutual relationship of creditor and debtor
between parties. In reciprocal obligations, the performance of one is conditioned
on the simultaneous fulfillment of the other obligation (Vermen Realty
|||

Development Corp. v. Court of Appeals, G.R. No. 101762, [July 6, 1993])

Article 1191 of the Civil Code provides the remedy of rescission in (more
appropriately, the term is "resolution") in case of reciprocal obligations, where
one of the obligors fails to comply with what is incumbent upon him. The general
rule is that rescission of a contract will not be permitted for a slight or causal
breach, but only for such substantial and fundamental breach as would defeat
the very object of the parties in executing the agreement. The question of
whether a breach of contract is substantial depends upon the attendant
circumstances (Vermen Realty Development Corp. v. Court of Appeals, G.R. No.
|||

101762, [July 6, 1993])

CONTRACTS; RECIPROCAL OBLIGATIONS; RESCISSION; JUDICIAL

ACTION. — Under Article 1191 of the New Civil Code, the right to resolve
reciprocal obligations, in case one of the obligors fail to comply with that which is
incumbent upon him, is deemed to be implied but in the absence of a stipulation
to the contrary this right must be invoked judicially; it cannot be exercised solely
on a party's own judgment that the other has committed a breach of the
obligation. Hence, where there is nothing in the contract of lease empowering the
defendants to rescind it without resort to the courts, the defendants action is
unilaterally terminating the contract is unjustified. (Philippine Amusement
|||

Enterprises, Inc. v. Natividad, G.R. No. L-21876, [September 29, 1967], 128
PHIL 320-327)
BREACH MUST BE SUBSTANTIAL. — Rescission by judicial action under
Article 1191 of the New Civil Code will be ordered only where the breach
complained of is substantial as to defeat the object of the parties in entering into
the agreement. It will not be granted where the breach is slight or
casual. (Philippine Amusement Enterprises, Inc. v. Natividad, G.R. No. L-21876,
|||

[September 29, 1967], 128 PHIL 320-327)

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