OBLIGATIONS AND CONTRACTS ATTY. NESTOR M.

LEYNES, III
(BASED ON THE OUTLINE OF PROF. EDUARDO S. LABITAG)

OBLIGATIONS
I. Definition - Art. 1156 II. Sources - Art. 1157 A. Law - Art. 1158 B. Contracts - Art. 1159, 1305 C. Quasi-Contracts - Art. 1160, 2142 1. Negotiorum Gestio - Art. 2144 2. Solutio Indebti - Art. 2154 3. Others - Art. 2164 - 2175 D. Delicts - Art. 1161 E. Quasi-Delicts - Art. 1162, 2176 1. Vicarious Liability - Art. 2180, Art. 218, 219 of the Family Code 2. Civil Liabilty From Delicts - Art. 1161, Rule 111 of the Rules of Court Barredo v. Garcia, 73 Phil. 607 (1942) Mendoza v. Arrieta, 91 SCRA 113 (1979) PSBA v. CA, 205 SCRA 729 (1992) Amadora v. CA, 160 SCRA 315 (1988) Air France v. Carrascoso, 18 SCRA 155 (1966) III. Prestations A. To Give 1. Specific Thing a. Deliver Thing Itself - Art. 1244 b. Preserve the Thing - Art. 1163 c. Deliver Accessions and Accessories - Art. 1166 d. Deliver Fruits - Art. 1164 2. Generic Thing

B. To Do - Art. 1244 C. Not To Do - Art. 1244 IV. Classifications A. Pure or Conditional - Art. 1179 - 1192 1. Pure - Art. 1179, Par. 1 2. Conditional - Art. 1181 Gaite v. Fonacier, 2 SCRA 830 (1961) Gonzales v. Heirs of Thomas, 314 SCRA 585 (1999) a. Kinds i. Effect on Obligation - Art. 1181 Gonzales v. Heirs of Thomas, supra - Suspensive - Art. 1187, 1188 Coronel v. CA, 263 SCRA 15 (1996) - Resolutory Parks v. Province of Tarlac, 49 Phil. 142 (1926) Central Philippine University v. CA, 246 SCRA 511 (1995) Quijada v. CA, 299 SCRA 695 (1998) ii. Cause or Origin - Potestative - Art. 1180 Francisco Lao Lim v. CA, 191 SCRA 150 (1990) - Casual Naga Telephone Co., Inc. v. CA, 230 SCRA 351 (1994) - Mixed Osmea v. Rama, 14 Phil. 99 (1909) Hermosa v. Longora, 93 Phil. 977 (1953) Taylor v. Uy Tieng Piao, 43 Phil. 873 (1922) Smith Bell v. Sotelo Matti, 44 Phil. 874 (1922) Rustan Pulp and Paper Mills v. IAC, 214 SCRA 665 (1992) Romero v. CA, 250 SCRA 223 (1995) iii. Possibility Art. 1183 Roman Catholic Archbishop of Manila v. CA, 198 SCRA 300 (1991)

iv. Mode - Positive - Art. 1184 - Negative - Art. 1185 b. Loss, Deterioration, Improvement - Art. 1189, 1190 Heirs of Timoteo Moreno v. Mactan Cebu International Airport Authority, 413 SCRA 502 (2003) c. Prevention by the Obligor - Art. 1186 Taylor v. Uy Tieng Piao, supra Herrera v. Leviste, 135 SCRA 129 (1985) B. Period / Term - Art. 1193 - 1198 1. Kinds a. Suspensive - Art. 1193, Par. 1 b. Resolutory - Art. 1193, Par. 2 2. Loss, Deterioration, Improvement - Art. 1194, 1189 3. Payment in Advance - Art. 1195 4. Benefit a. Presumption - Art. 1196 Lachica v. Araneta, 47 OG No. 11, 5699, August 4, 1949 Ponce de Leon v. Syjuco, 90 Phil. 311 (1951) Buce v. CA, 332 SCRA 151 (2000) b. Debtor Loses Right - Art. 1198 5. Court to Fix Period - Art. 1197 Araneta v. Philippine Sugar Estate Development Co., 20 SCRA 330 (1967) Central Philippine University v. CA, supra Deudor v. JM Tuason, 2 SCRA 129 (1961) C. Alternative / Facultative - Art. 1199 - 1206 1. Right of Choice - Art. 1200 2. Notice of Choice - Art. 1201 3. Loss or Impossibility of One or All Prestations - Art. 1202 - 1205 4. Facultative - Art. 1206 D. Joint or Solidary - Art. 1207 - 1222 1. Joint

a. Presumption - Art. 1207, 1208 b. Effect - Art. 1207, 1208, 1277 2. Solidary a. Kinds i. Source - Art. 1208, 1915, 1945, 2194, Art. 119 of the Revised Penal Code ii. Parties Bound, Uniformity - Art. 1211 Inchausti v. Yulo, 34 Phil. 978 (1914) Inciong v. CA, 257 SCRA 578 (1996) RCBC v. CA, 178 SCRA 739 (1989) Lafarge Cement Phil. v. Continental Cement, 443 SCRA 522 (2004) b. Effect i. Solidary Creditor - Common Debtor - Art. 1214 - 1217, Par. 1 - Solidary Co-Creditor/s - Art. 1212, 1213, 1215, Par. 2 ii. Solidary Debtor - Common Creditor - Art. 1207, 1215, Par. 1 - Solidary Co-Debtor/s - Art. 1217 1221 Jaucian v. Querol, 38 Phil. 707 (1918) RFC v. CA, O.G. No. 6, p. 2467 Quiombing v. CA, 189 SCRA 325 (1990) Inciong v. CA, supra c. Defenses of a Solidary Debtor Against the Creditor - Art. 1222 Inchausti v. Yulo, supra Alipio v. CA, 341 SCRA 441 (2000) 3. Joint Indivisible - Art. 1209, 1210, 1224 E. Divisible or Indivisible - Art. 1223 - 1225 1. Divisible - Art. 1223, 1233 2. Indivisible a. Kinds i. Natural - Art. 1225, Par. 1 ii. Legal - Art. 1225, Par. 3

iii. Conventional - Art. 1225, Par. 3 b. Presumptions - Art. 1225, Par. 1, 2 c. To Do - Art. 1225, Par. 3 d. Effects - Art. 1223, 1224, 1233 F. Penal Clause - Art. 1226 - 1230 1. Demandability - Art. 1226, Par. 2 2. Effects a. Substitute for Indemnity for Damages and Payment of Interest - Art. 1226 Makati Development Corp. v. Empire Insurance Co., 20 SCRA 557 (1967) Tan v. CA, 367 SCRA 571 (2001) Country Bankers Insurance v. CA, 201 SCRA 458 (1991) b. Debtor Not Exempt from Performance - Art. 1227 c. Creditor Cannot Demand Performance and Penalty - Art. 1227 d. Ceditor Cannot Collect Other Damages - Art. 1226 e. Penalty Equitably Reduced - Art. 1229 f. Nullity of Principal Obligation or Penal Clause - Art. 1230 G. Legal / Coventional / Penal - Art. 1158, 1159, 1161 V. Breach A. Substantial or Casual Song Fo v. Hawaiian Phils., 47 Phil. 821 (1928) Velarde v. CA, 361 SCRA 56 (2001) Angeles v. Calasanz, 135 SCRA 323 (1985) Delta Motor Corp. v. Genuino, 170 SCRA 29 (1989) Vermen Realty v. CA, 224 SCRA 549 (1993) B. Modes 1. Dolo a. Dolo Incidente or Dolo Causante Woodhouse v. Halili, 93 Phil. 526 (1953) Geraldez v. CA, 230 SCRA 320 (1994) b. Non-Waiver - Art. 1171 2. Negligence - Art. 1172

a. Culpa or Dolo, Culpa Aquilana or Culpa Contractual Gutierrez v. Gutierrez, 56 Phil. 176 (1931) Vasquez v. Borja, 74 Phil. 560 (1944) b. Degree of Diligence - Art. 1173, Par. 2 De Guia v. Manila Electric Co., 40 Phil. 706 (1920) US v. Barias, 23 Phil. 434 (1912) Sarmiento v. Spouses Cabrido, 401 SCRA 122 (2003) Crisostomo v. CA, 409 SCRA 528 (2003) 3. Mora - Art. 1169 a. Mora Solvendi i. Necessity of Demand Cetus Development Corp. v. CA, 176 SCRA 72 (1989) Aerospace Chemical Industries v. CA, 315 SCRA 92 (1999) Santos Ventura Hocorma Foundation v. Santos, 441 SCRA 472 (2004) Vazquez v. Ayala Corporation, 443 SCRA 231 (2004) ii. Exceptions Abella v. Francisco, 55 Phil. 447 (1930) De La Cruz v. Apolonio Legaspi & Concordia Samperoy, 98 Phil. 43 (1955) b. Mora Accipiendi Vda. De Villaruel v. Manila Motor Co., Inc., 104 Phil. 926 (1958) c. Compensatio Morae Central Bank v. CA, 139 SCRA 46 (1985) 4. Contravention of Tenor Chavez v. Gonzales, 32 SCRA 547 (1970) Telefast v. Castro, 158 SCRA 445 (1988) Arrieta v. NARIC, 10 SCRA 79 (1964) Magat v. Medialdea, 206 Phil. 341 (1983) VI. Remedies A. Primary 1. Performance a. Specific Performance for Specific Thing in To Give - Art. 1165, Par. 1, Sec. 10, Rule 39 of the Rules of Court

b. Substituted Performance for Generic Thing in To Give - Art. 1162, Par. 2 c. Substituted Performance or Undoing of Poor Work in To Do - Art. 1167 Chavez v. Gonzales, supra Tanguilig v. CA, 266 SCRA 78 (1997) d. Undoing in Not To Do - Art. 1168 2. Rescision - Art. 1191, 1192, 1786, 1788, 1484-1486, R.A. 6552 Song Fo v. Hawaiian-Philippines, supra Boysaw v. Interphil Promotions, 148 SCRA 635 (1987) U.P. v. De Los Angeles, 35 SCRA 102 (1970) De Erquiaga v. CA, 178 SCRA 1 (1989) Angeles v. Calasanz, supra Ong v. CA, 310 SCRA 1 (1999) Iringan v. CA, 366 SCRA 41 (2001) Visayan Saw Mill v. CA, 219 SCRA 378 (1993) Deiparine v. CA, 221 SCRA 503 (1993) Grace Park Engineering Co., Inc. v. Dimaporo, 107 SCRA 266 (1981) Roque v. Lapuz, 96 SCRA 741 (1980) Suria v. IAC, 151 SCRA 661 (1987) 3. Damages - Art. 1170 B. Subsidiary 1. Accion Subrogatoria - Art. 1177 - Exceptions - Art. 772 2. Accion Pauliana - Art. 1177, 1381, Par. 3 Khe Hong Cheng v. CA, 355 SCRA 701 (2001) Siguan v. Lim, 318 SCRA 725 (1999) 3. Other Specific Remedies - Art. 1652, 1729, 1608, 1893 VII. Fortuitous Event A. Concurrence of Fault Juan Nakpil & Sons v. CA, 144 SCRA 596 (1986) Republic v. Luzon Stevedoring Co., 21 SCRA 279 (1967) Dioquino v. Laureano, 33 SCRA 65 (1970)

Austria v. CA, 39 SCRA 527 (1971) NPC v. CA, 161 SCRA 334 (1988) Yobido v. CA, 281 SCRA 1 (1997) Bacolod-Marcia Milling v. CA, 182 SCRA 24 (1990) Philcomsat v. Globe Telecom, 429 SCRA 153 (2004) B. Exceptions - Art. 1174, 1165, Par. 3, 1942, 1979, 2001, 2147 VIII. Usurious Transactions A. P.D. 858 B. Central Bank Circular 416 C. Monetary Board Circular 905 - Art. 2209 Eastern Shipping Lines v. CA, 234 SCRA 781 (1994) Crismina Garments v. CA, 304 SCRA 356 (1999) Keng Hua Products v. CA, 286 SCRA 257 (1998) Security Bank v. RTC Makati, 263 SCRA 483 (1996) Almeda v. CA, 256 SCRA 292 (1996) Angel Warehousing v. Cheldea, 23 SCRA 119 (1968) First Metro Investment v. Este. Del Sol, 369 SCRA 99 (2001) IX. Transmissibility of Rights - Art. 1178 X. Modes of Extinguishment - Art. 1231 A. Payment or Performance - Art. 1232 1. Requisites a. Payor i. Third Person / Interested Party Art. 1302 (3)

ii. Third Person / Not an Interested Party / With Consent of the Debtor Art. 1302 (2), 1236, Par. 1 iii. Third Person / Not an Interested Party / Without Knowledge or Against the Will of the Debtor Art. 1236, Par. 1, 2, 1237 iv. Third Person / Does Not Intend to be Reimbursed Art. 1238 v. Obligations to Give Art. 1239, 1427 vi. Active Solidarity Art. 1214 b. Payee Art. 1240 i. Incapacitated Person Art. 1241, Par. 1

ii. Third Person Art. 1241, Par. 2 iii. Proof of Benefit Not Required Art. 1241, Paragaraph 2, 1242 iv. Active Solidarity Art. 1214 c. Identity i. Specific Thing Art. 1244

ii. Generic Thing Art. 1246 iii. Pay Money Art. 1249, 1250; R.A. 529, 4100 Arrieta v. NARIC, supra Kalalo v. Luz, 34 SCRA 377 (1970) St. Paul Fire and Marine Insurance v. Macondray, 70 SCRA 122 (1976) Papa v. A.V. Valencia, 284 SCRA 643 (1998) PAL v. CA, 181 SCRA 557 (1990) d. Integrity - Art. 1233 i. Partial Payment Art. 1248

ii. Exceptions Art. 1248 iii. Substantial Performance in Good Faith Art. 1234 iv. Estoppel Art. 1235 v. Interests and Installments Art. 1176 e. When Payment Made Art. 1169 f. Where Payment Made Art. 1251, Par. 1 4

g. Expenses Art. 1247 2. Application of Payments Art. 1252 1254 Reparations Commission v. Universal Deep Sea Fishing, 83 SCRA 764 (1978) Paculdo v. Regalado, 345 SCRA 134 (2000) 3. Payment by Cession Art. 1255 4. Dacion en Pago Art. 1245 Development Bank of the Philippines v. CA, 284 SCRA (1998) Filinvest Credit Corporation v. Philippine Acetylene, 111 SCRA 421 (1982) 5. Tender of Payment and Consignation a. Tender / Refusal Not Required Art. 1256, Par. 2 b. Twin Notice Requirement Art. 1257, Par. 1, 1258, Par. 2

c. Effects Art. 1260, Par. 1 d. Withdrawal by Debtor / Before Acceptance by Creditor / Before Approval by Court Art. 1260, Par. 2 e. Withdrawal by Debtor / After Consignation Art. 1261 f. Expenses Art. 1259 De Guzman v. CA, 137 SCRA 730 (1985) TLG International Continental Enterprising, Inc. v. Flores, 47 SCRA 437 (1972) McLaughlin v. CA, 144 SCRA 693 (1986) Soco v. Militante, 123 SCRA 160 (1983) Sotto v. Mijares, 28 SCRA 17 (1969) Reisenbeck v. CA, 209 SCRA 656 (1992) Rural Bank of Caloocan v. CA, 104 SCRA 151 (1981) Licuanan v. Diaz, 175 SCRA 530 (1989) Chan v. CA, 230 SCRA 685 (1994) Meat Packing Corp v. Sandiganbayan, 359 SCRA 409 (2001) B. Loss or Impossibility 1. Loss Art. 1189 (2) a. Requisites Art. 1262 b. Presumption Art. 1265, 1165 c. Effect i. Specific Thing Art. 1262, 1268

ii. Generic Thing Art. 1263 iii. Partial Loss Art. 1264 iv. Third Persons Art. 1269 2. Impossibility Art. 1266, 1267 a. Requisites Art. 1266 b. Effect i. To do Art. 1266, 1267, 1262, Par. 2 Occea v. CA, 73 SCRA 637 (1976) Naga Telephone Co. v. CA, supra PNCC v. CA, 272 SCRA 183 (1997) ii. Partial Impossibility Art. 1264

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C. Condonation or Remission Art. 1270, Par. 1 1. Requisites Art. 1270, Par. 2 YAM v. CA, 303 SCRA 1 (1999) 2. Presumptions Art. 1271, 1272, 1274 3. Rules Art. 1270 4. Principal or Accessory Art. 1273 D. Confusion or Merger of Rights Art. 1275 1. Joint or Solidary Art. 1277 2. Principal or Accessory Art. 1276 E. Compensation Art. 1278 1. Origin Art. 1279, 1282, 1283 2. Legal a. Requisites - Art. 1279, 1280 Gan Tion v. CA, 28 SCRA 235 (1969) BPI v. Reyes, 255 SCRA 571 (1996) PNB v. Sapphire Shipping, 259 SCRA 174 (1996) CKH Industrial Development v. CA, 272 SCRA 333 (1997) Mirasol v. CA, 351 SCRA 44 (2001) Associated Bank v. Tan, 446 SCRA 282 (2004) Villanueva v. Tantuico, Jr., 182 SCRA 263 (1990) Perez v. CA, 127 SCRA 636 (1984) Silahis Marketing Corp v. IAC, 180 SCRA 21 (1989) 3. Effect Art. 1290, 1289 4. Not Allowed Art. 1287, 1288 5. Debts Payable in Different Places Art. 1286 6. Effect of Nullity of Debts Art. 1284 7. Effect of Assignment of Credit a. With Consent of Debtor Art. 1285, Par. 1 b. With Knowledge / Without Consent of Debtor Art. 1285, Par. 2 c. Without Knowledge of Debtor Art. 1285, Par. 3 F. Novation Art. 1291

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1. Requisites Art. 1292 Millar v. CA, 38 SCRA 642 (1971) Dormitorio v. Fernandez, 72 SCRA 388 (1976) Magdalena Estate v. Rodriguez, 18 SCRA 967 (1966) Reyes v. Secretary of Justice, 264 SCRA 35 (1996) Conchingyan v. RB Surety and Insurance, 151 SCRA 339 (1987) Broadway Centrum Condominium Corp v. Tropical Hut, 224 SCRA 302 (1993) Molino v. Security Diners International, 363 SCRA 358 (2001) Garcia v. Llamas, 417 SCRA 292 (2003) California Bus Line v. State Investment, 418 SCRA 297 (2003) Babst v. CA, 350 SCRA 341 (2001) 2. Effect Art. 1296 3. Original or New Obligation Art. 1297 1299 4. Objective or Subjective a. Change of Debtor i. Expromision Art. 1293, 1294

ii. Delegacion Art. 1293, 1295 Garcia v. Llamas, supra Quinto v. People, 305 SCRA 708 (1999) b. Change of Creditor Art. 1300 i. Conventional Art. 1301, 1303, 1304 Licaros v. Gatmaitan, 362 SCRA 548 (2001) ii. Legal Art. 1302, 1303, 1304 Astro Electronics Corp. v. Philippine Export and Foreign Loan Guarantee Corporation, 411 SCRA 462 (2003)

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CONTRACTS
I. Definition Art. 1305 A. Characteristics 1. Obligatory Force Art. 1308 2. Mutuality Art. 1308 1310, 1473 GSIS v. CA, 228 SCRA 183 (1993) Professional Academic Plans, Inc. v. Crisostomo, 453 SCRA 342 (2005) 3. Relativity Art. 1311, 1317 Manila Railroad Co. v. La Compaia Trasatlantica, 83 Phil. 875 (1918) DKC Holdings Corp. v. CA, 329 SCRA 666 (2000) Gutierrez Hermanos. v. Orense, 28 Phil. 571 (1914) B. Parties Art. 1306 Gabriel v. Monte de Piedad, 71 Phil. 497 (1941) Pakistan International Airlines v. Ople, 190 SCRA 90 (1990) Special Disqualifications Art. 1490, 1491, Art. 87 of the Family Code C. Stipulations Art. 1306 1. Pactum Commissorium Art. 2088 2. Pactum Leonina Aart. 1799 3. Pactum de Non Alienado Cui v. Arellano, 2 SCRA 205 (1961) Arroyo v. Berwin, 36 Phil. 386 (1917) Filipinas Compaia de Seguros v. Mandanas, 17 SCRA 391 (1966) Bustamante v. Rosel, 319 SCRA 413 (1999) D. Classification Art. 1307, 1315, 1316 Dizon v. Gaborro, 83 SCRA 688 (1978) Corpuz v. CA, 93 SCRA 424 (1988) E. Third Persons 1. Stipulations Pour Autrui Art. 1311, Par. 2 Florentino v. Encarnacion, 79 SCRA 192 (1977) Coquia v. Fieldmens Insurance Co., 26 SCRA 178 (1968) Constantino v. Espiritu, 39 SCRA 206 (1971)

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Young v. CA, 169 SCRA 213 (1989) Marmont Resort v. Guiang, 168 SCRA 373 (1988) Mandarin Villa v. CA, 257 SCRA 538 (1996) 2. Possession of Object Art. 1312 3. Creditors of the Contracting Parties Art. 1313 4. Interference Art. 1314 Daywalt v. Corp., 39 Phil. 587 (1919) So Ping Bun v. CA, 314 SCRA 751 (1999) Lagon v. CA, 453 SCRA 616 (2005) II. Essential Elements A. Consent 1. Requisites - Art. 1319 Rosenstock v. Burke, 46 Phil. 217 (1924) Malbarosa v. CA, 402 SCRA 168 (2003) San Lorenzo Development Corporation vs. CA, 449 SCRA 99 (2005) MMDA vs. Jancom, 375 SCRA 320 (2002) a. Offer - Art. 1319, 1321 - 1323, 1325, 1326 b. Acceptance - Art. 1319, 1320 i. Period - Art. 1324 Sanchez v. Rigos, 45 SCRA 368 (1972) ii. Option Contract - Art. 1324 c. Legal Capacity of Parties - Art. 1327 d. Intelligent, Free, Spontaneous, Real - Art. 1330 - 1346 i. Mistake of Fact Asiain v. Jalandoni, 45 Phil. 296 (1923) Heirs of William Sevilla v. Sevilla, 402 SCRA 501 (2003) Andres v. Manufacturers Hanover and Trust, 177 SCRA 618 (1989) Spouses Theis v. CA, 268 SCRA 167 (1997) ii. Error of Law - Art. 3, 1334 iii. Unable to Read - Art. 1332 Dumasug v. Modelo, 34 Phil. 252 (1916)

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Hemedes v. CA, 316 SCRA 347 (1999) Lustan v. CA, 266 SCRA 663 (1997) Katipunan v. Katipunan, 375 SCRA 199 (2002) Leonardo v. CA, 438 SCRA 201 (2004) iv. Inexcusable Mistake - Art. 1333 v. Violence and Intimidation - Art. 1335, 1336 Martinez v. Hongkong and Shanghai Bank, 15 Phil. 252 (1910) Lee v. CA, 201 SCRA 405 (1991) vi. Undue Influence - Art. 1337 vii. Dolo - Art. 1338 Hill v. Veloso, 31 Phil. 160 (1915) Woodhouse v. Halili, supra Geraldez v. CA, 230 SCRA 320 (1994) Sierra v. CA, 211 SCRA 785 (1992) - Dolo Causante - Art. 1338 - Dolo Incidente - Art. 1344, Par. 2 - Failure to Disclose - Art. 1339 Tuason v. Marquez, 45 Phil. 381 (1923) Rural Bank of Sta. Maria v. CA, 314 SCRA 255 (1999) - Exaggerations in Trade - Art. 1340 Azarraga v. Gay, 52 Phil. 599 (1928) Trinidad v. IAC, 204 SCRA 524 (1991) - Expression of Opinion - Art. 1341, 1344 Songco v. Sellner, 37 Phil. 254 (1917) viii. Misrepresentation - Third Person - Art. 1342 - Good Faith - Art. 1343 - Active / Passive Mercado v. Espiritu, 37 Phil. 215 (1917) Braganza v. Villa Abrille, 105 Phil. 456 (1959) ix. Simulation of Contracts - Art. 1346

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Garanciang v. Garanciang, 28 SCRA 229 (1969) Suntay v. CA, 251 SCRA 430 (1995) Pangadil v. CFI, 116 SCRA 347 (1982) Umali v. CA, 189 SCRA 529 (1990) - Absolute / Relative - Art. 1345 Macapagal v. Remorin, Caluza, 458 SCRA 652 (2005) B. Object - Art. 1347, 1349 1. Future Inheritance - Art. 1347 Blas v. Santos, 1 SCRA 899 (1961) J.L.T. Agro, Inc. v. Balansag, 453 SCRA 211 (2005) 2. Impossible Things or Services - Art. 1348 C. Cause - Art. 1350, 1351 1. Presumption - Art. 1354 2. Absence / Unlawful Cause - Art. 1352 Liguez v. CA, 102 Phil. 577 (1957) 3. Statement of False Cause - Art. 1353 4. Lesion or Inadequacy of Cause - Art. 1355 Carantes v. CA, 76 SCRA 514 (1977) Spouses Buenaventura v. CA, 416 SCRA 263 (2003) III. Form Art. 1356 A. Required for Validity - Art. 748, 749, 1874, 2134, 1771, 1773 Hernaez v. De los Angeles, 27 SCRA 1276 (1969) B. Required for Effectivity to Third Persons Art. 1357, 1358 C. Required for Proving Existence Art. 1403 Resuena v. CA, 454 SCRA 42 (2005) IV. Reformation of Instruments A. Requisites Art. 1359 Garcia v. Bisaya, 97 Phil. 609 (1955) Bentir v. Leande, 330 SCRA 591 (2000) Quiros v. Arjona, 425 SCRA 57 (2004) B. Reformation Not Allowed Art. 1366

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C. Implied Ratification Art. 1367 D. Interested Party Art. 1368 E. Procedure Art. 1369 Atilano v. Atilano, 28 SCRA 231 (1969) Carantes v. CA, supra Sarming v. Dy, 383 SCRA 131 (2002) V. Interpretation A. Intent Art. 1370 1372 Borromeo v. CA, 47 SCRA 65 (1972) Kasilag v. Rodriguez, 69 Phil. 217 (1939) Santi v. CA, 227 SCRA 541 (1993) Rapanut v. CA, 246 SCRA 323 (1995) B. Several Meanings Art. 1373 Oil And Natural Gas Commission v. CA, 293 SCRA 26 (1998) C. Doubtful Stipulations Art. 1374 Spouses Rigor v. Consolidated Orix Leasing and Finance Corporation, 387 SCRA 437 (2002) D. Different Significations Art. 1375 E. Ambiguities and Omissions Art. 1376 Chua v. CA, 401 SCRA 54 (2003) F. Party Causing Obscurity Art. 1377 RCBC v. CA, 305 SCRA 449 (1999) G. Impossibility of Settling Doubts Art. 1378 Gacos v. CA, 212 SCRA 8 (1992) H. Doubts on Principal Object Art. 1378 VI. Defective Contracts A. Rescissible - Art. 1380, 1381, 1191 Universal Food Corp. v. CA, 33 SCRA 1 (1970) Pryce Corporation v. PAGCOR, 458 SCRA 164 (2005) Spouses Cannu v. Spouses Galang, 459 SCRA 80 (2005) Iringan v. CA, 366 SCRA 41 (2001) Rivera v. Del Rosario, 419 SCRA 626 (2004)

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Equatorial Realty Development v. Mayfair Theatre, 370 SCRA 56 (2001) 1. Requisites - Art. 1383, 1385, 1389 The Union Insurance Society of Canton v. CA, 260 SCRA 431 (1996) Rivera v. Del Rosario, supra 2. Effect - Art 1385 3. Extent - Art. 1384 Siguan v. Lim, supra 4. Presumption of Fraud Oria v. Mcmicking, 21 Phil. 243 (1912) Siguan v. Lim, supra Suntay v. CA, supra China Banking Corporation v. CA, 327 SCRA 378 (2000) MR Holdings Ltd v. Carlos, 380 SCRA 617 (2002) 5. Liability for In Fraud of Creditors - Art. 1388 B. Voidable or Annullable - Art. 1390 1. Annulment Felipe v. Heirs of Aldon, 120 SCRA 628 (1983) a. Interested Party - Art. 1397 Singsong v. Isabela Sawmill, 88 SCRA 623 (1979) Samahan ng Magsasaka sa San Josep v. Valisno, 430 SCRA 629 (2004) Malabanan v. Gaw Ching, 181 SCRA 84 (1990) Armentia v. Patriarca, 18 SCRA 1253 (1966) b. Prescription - Art. 1391 Carantes v. CA, 76 SCRA 514 (1977) c. Effect i. Mutual Restitution - Art. 1398, 1402 Cadwallader & Co. v. Smith, Bell & Co., 7 Phil. 461 (1907) Velarde v. CA, supra Ines v. CA, G.R. No. 114051, 247 SCRA 312 (1995) Arra Realty Corporation v. Guarantee Development Corporation, 438 SCRA 441 (2004) ii. Incapacitated Party - Art. 1399

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Katipunan v. Katipunan, 375 SCRA 199 (2002) iii.Lost Through Fault - Art. 1400 d. Extinguishment - Art. 1392, 1401 2. Ratification a. Form - Art. 1393, 1394 b. Effect i. Extinguished - Art. 1392 Uy Soo Lim v. Tan Unchuan, 38 Phil. 552 (1918) ii. Retroactivity - Art. 1396 C. Unenforceable - Art. 1403 1. Unauthorized Contracts - Art. 1404 2. Statute of Frauds Asia Production Co., Inc. v. Pao, 205 SCRA 458 (1992) Western Mindanao Co. v. Medalle, 79 SCRA 703 (1977) Limketkai Sons v. CA, 250 SCRA 523 (1995) Babao v. Perez, 102 Phil. 756 (1957) Reiss v. Memije, 15 Phil. 350 (1910) Villanueva v. CA, 267 SCRA 89 (1997) a. Purpose Philippine National Bank v. Philippine Vegetable Oil Co., 49 Phil. 857 (1927) b. Ratification - Art. 1405 Carbonnel v. Poncio, 103 Phil. 655 (1958) First Philippine International Bank v. CA, 252 SCRA 259 (1996) c. Public Document for Registration - Art. 1406 3. Both Parties Incapacitated to Consent - Art. 1407 D. Void or Inexistent - Art. 1409 Tongoy v. CA, 123 SCRA 99 (1983) Cui v. Arellano University, supra Chavez v. PCGG, 307 SCRA 394 (1999) Guiang v. CA, 291 SCRA 372 (1998) Castillo v. Galvan, 85 SCRA 526 (1978)

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1. Void a. Criminal offense - Art. 1411 b. Unlawful Act - Art. 1412 Menchacez v. Teves, 449 SCRA 380 (2005) Angel v. Modales, 420 SCRA 645 (2004) c. Illegal Purpose - Art. 1414 d. Illegal Contract - Art. 1415 Liguez v. CA, supra Relloza v. Gaw Cheen Hum, 93 Phil. 827 (1953) e. Prohibited Agreement - Art. 1416 Philippine Banking Corp. v. Lui She, 21 SCRA 52 (1967) Frenzel v. Catito, 406 SCRA 55 (2003) Acabal and Nicolas v. Acabal, 454 SCRA 555 (2005) f. Amout Paid Exceeds Maximum Fixed by Law - Art. 1417 g. Laborer Exceeds Hours Fixed by Law - Art. 1418 h. Laborer Accepts Lower Wage Under the Law - Art. 1419 2. Inexistent - Art. 1345, 1346 3. Non-waiver of Defense - Art. 1409 4. Non-prescription of Action - Art. 1410 5. Interested Party - Art. 1421 VII. Natural Obligations Art. 1423-1430 Villaroel v. Estrada, 71 Phil. 140 (1940) Fisher v. Robb, 69 Phil. 101 (1939) VIII. Estoppel Art. 1431 Kalalo v. Luz, supra A. Technical Estoppel Art. 1433 B. Estoppel in pais Art. 1433 C. Persons Bound Art. 1439 Manila Lodge No. 761 Benevolent and Protective Order of the Elks v. CA, 73 SCRA 162 (1976) D. Applicable Cases Art. 1434 1438 Miguel v. Catalino, 26 SCRA 234 (1968)

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Mendoza v. Reyes, 124 SCRA 154 (1983) IV. Trusts Art. 1442 A. Parties Art. 1440 B. Kinds Art. 1441 Salao v. Salao, 70 SCRA 65 (1976) 1. Express Trusts Art. 1443 1445 2. Implied Trusts Art. 1457, 1448 - 1456 Fabian v. Fabian, 22 SCRA 231 (1968) Bueno v. Reyes, 27 SCRA 1179 (1969) Tamayo v. Callejo, 46 SCRA 27 (1972) Heirs of Sanjorjo v. Quijano, 449 SCRA 15 (2005) Aznar Brothers Realty Company v. Aying, 458 SCRA 496 (2005)

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