SECTION 1.

PURE AND CONDITIONAL OBLIGATIONS

Article 1179. Every obligation whose performance does not depend upon a future
or uncertain event, or upon a past unknown to the parties, is demandable at once.
Every obligation which contain a resolutory condition shall also be demandable,
without prejudice to the effects of the happening of the event.
Pure Obligation
- which is not subject to any condition and no specific date is mentioned for its fulfillment
and is, therefore, immediately demandable.
Conditional Obligation
- whose consequences are subject in one way or another to fulfillment of a condition.
Condition
- future and uncertain event, upon the happening of which, the acquisition or
extinguishment of an obligation (or right) subject to it depends.
Characteristics of a condition
1. Future and uncertain – In order to constitute an event as a condition, it must be
future and uncertain.
2. Past but unknown – refers to future event, both its very occurrence and the time
of such occurrence must be uncertain.
- condition must not be impossible.
2 Principal kinds of obligation
1. Suspensive Condition (condition precedent or condition antecedent)
- fulfillment of which will give rise to an obligation (or right).
- demandability of the obligation is suspended until the happening of the
uncertain event which constitutes the conditions
2. Resolutory Condition (condition subsequent)
- fulfillment of which will extinguished an obligation (or right) already existing
Distinction between suspensive and resolutory conditions
1.- if the suspensive condition is fulfilled, the obligation arises
- if the resolutory condition is fulfilled, obligation is extinguished
2. – suspensive condition does not take place, legal tie does not appear
- resolutory condition does not take place, legal tie is consolidated
3. – until suspensive condition takes place, existence of obligation is mere hope
- until resolutory condition takes place, its effect flow, but over it hovers the possibility
of termination.
When is obligation demandable at once
1. it is pure
2. subject to a resolutory condition
3.subject to resolutory period
Past event unknown to parties
- a condition really refers to uncertain and future event.
- a past event cannot be said to be a condition since the demandability of an obligation
subject to a condition depends upon whether the event will happen or will not happen.
Ex. X owner of land which being claimed by Y. X won the case but the court is yet to
deliver the notice. X, obliged himself to sell land to B.
Article 1180. When the debtor binds himself to pay when his means permit him to
do so, the obligation shall be deemed to be one with a period, subject to the
provisions of Article 1197
Where duration of period depends upon the will of debtor.
- a period is a future and certain event upon the arrival of which the obligation subject
to it either arises or is extinguished.
1. The debtor promises to pay when his means permit him to do so – obligation
shall be one with the period. Debtor’s will is the duration of the period.
- if debtor and creditor cannot decide to specific time for payment, the court shall
fix the same on the application.
2. Other Cases – as when the debtor binds himself to pay
a) Little by little
b) As soon as possible
c) From time to time
d) At any time, I have the money
e) In partial payments
f) When I am in position to pay.
Article 1181. In conditional obligations, the acquisition of rights, as well as the
extinguishment or loss of those already acquired, shall depend upon the
happening of the event which constitutes the condition.
Effect of happening of condition
1. Acquisition of rights – in obligations subject to a suspensive condition, the
acquisition of rights by the creditor depend upon the happening of the event
which constitutes the condition.
Ex. T in his last will and testament will give H a property provided T will die in 2
yrs. If T died after 3 yrs, as if no provision was made by T.
2. Loss of rights already acquired – obligation subject to resolutory condition,
happening of the event which constitutes the condition produces the
extinguishment or loss of rights already acquired.
Ex. Y promise to support X, till he graduates. The right to receive support
extinguished once the condition is fulfilled.
Article 1182. When the fulfillment of the condition depends upon the sole will of
the debtor, the conditional obligation shall be void. If it depends upon chance or
upon the will of a third person, the obligation shall take effect in conformity with
the provisions of this code.
Classification of conditions
1. As to effect:
a) Suspensive – happening which give rises to obligation
b) Resolutory – extinguishes obligation
2. As to form
a) Express – condition is clearly stated
b) Implied – condition is mere inferred
3. As to possibility
a) Possible – capable of fulfillment, legally and physically
b) Impossible – not capable of fulfillment “
4. As to cause or origin
a) Potestative – condition depends upon the will of one of the contracting
parties
b) Casual – condition depends upon chance or upon the will of a third person
 c) Mixed – depends partly upon chance and partly upon the will a third
person.
5. As to mode
a) Positive – condition consists in the performance of an act
b) Negative – condition consists the omission of an act
6. As to numbers
a) Conjunctive – several conditions and all must be fulfilled
b) Disjunctive – several conditions and only one or some of them must be
fulfilled.
7. As to divisibility
a) Divisible – condition is susceptible partial performance
b) Indivisible – not susceptible of partial performance
Potestative Condition
- a condition suspensive in nature and which depends upon the sole will of one of the
contracting parties.
Where suspensive condition depends upon will of debtor
1. Conditional obligation void – potestaive condition depends solely upon the debtor
is void because its validity and compliance is left to the will of debtor, cannot be
easily demanded.
2. Only the condition void – Ex. D borrowed 10k from C payable within 2 mos. D
promise to pay C after he sell his car. Condition is void (2 mos) but may obli
parin.
Where suspensive condition depends upon will of creditor
- obligation is valid.
- creditor is interested in the fulfillment of the obligation. Up to him whether to enforce
his right or not,
Where resolutory condition depend upon will of debtor
- like right to repurchase in a sale of pacto de retro (ownership of property), obligation is
valid.
- position of debtor when the condition is resolutory is exactly the same as that of the
creditor when the condition is suspensive.
Casual Condition
- if suspensive condition depends upon chance or upon the will of a third person, the
obligation subject to it is valid.
Ex. S binds himself to sell his land to B if he wins a case.
Mixed Condition
- obligation is valid if the suspensive condition depends partly upon chance and partly
upon the will of a third person.
Ex. X obliges himself in favor of Y to repair at X’s expense , any damage to the building
taking place after an earthquake if found by panel that constructions defects contributed
in any way to damage.
Where suspensive condition depend partly upon will of debtor
- valid
- if the compliance with the obligation still depend upon that part of the condition whose
fulfillment depend upon the will of debtor, the obligation is void.
Article 1183. Impossible conditions, those contrary to good customs or public
policy and whose prohibited by law shall annul the obligation which depends
upon them. If the obligation is divisible that part thereof which is not affected by
the impossible or unlawful condition shall be valid.
The condition not to do an impossible thing shall be considered as not having
been agreed upon.
- refers to suspensive condition
- applies only to cases where the impossibility already existed at the time the obligation
was constituted.
Two kind of impossible conditions
1. Physically impossible conditions – cannot exist or cannot be done
2. Legally impossible – contrary to law, morals, good customs, public order or public
policy
Effect of impossible conditions
1. Conditional Obligation void – obligor knows his obligation cannot be fulfilled. He
has no intention to comply with his obligation
2. Conditional obligation valid – if condition is to negative (not to do) it is
disregarded and the obligation is rendered pure and valid.
 3. Only the affected obligation void – if obligation is divisible, the part thereof not
affected by the impossible condition shall be valid.
4. Only the condition void. – if obligation is pre-existing obligation, and therefore
does not depend upon the fulfillment of the condition which is impossible, for its
existence only the condition is void.
Ex. D borrows 10k from C. D will only pay if C kills Y. condition is void.
Article 1184. The condition that some event happen at a determinate time shall
extinguish the obligation as soon as the time expires or if it has become
indubitable that the event will not take place.
Positive Condition
- article refers to positive suspensive condition. Obligation extinguishes:
1. As soon as the time expires without the event taking place
2. As soon as it has become indubitable that the event will not take place although
the time specified has not expired
Ex. X will give 10k to Y if he marry C before B become 23 yrs old. Obligation is
extinguished if Y marry C when B is 23 or above or if B died at 22.
Article 1185. The condition that some event will not happen at a determinate time
shall render that obligation effective from the moment the time indicated has
elapsed, or if it has become evident that the event cannot occur.
If no time has been fixed, the condition shall be deemed fulfilled at such time as
may have probably been contemplated, bearing in mind the nature of the
obligation
Negative Condition
- an event will not happen at a determinate time. Obligation effective and binding:
1. From the moment the time indicated has elapsed without the event taking place
2. From the moment it has become evident that the event cannot occur, although
the time indicated has not yet elapsed.
Ex. X will give 10k to Y if he doesn’t marry C before aug 30. X is liable is Y marry C after
aug.30 or if C died.
Article 1186. The condition shall be deemed fulfilled when the obligor voluntarily
prevents its fulfillment
Constructive fulfillment of suspensive condition
3 requisites
1. Condition is suspensive
2. Obligor actually prevents the fulfillment of the condition
3. Acts voluntarily
Ex. X will give Y 5% commission if Y could sell his land at a certain price. Y found a
buyer. X sell the land himself without Y.
Constructive fulfillment of resolutory
- respect to debtor who is bound to return what he has received upon the fulfillment of
condition.
Ex. X obliges himself to allow Y occupy house as long as X is assigned by their
company in province. X is going to manila, Y told president replace X. Y must vacate
house.
Article 1187. The effects of a conditional obligation to give, once the condition
has been fulfilled, shall retroact to the day of the constitution of the obligation.
Nevertheless, when the obligation imposes reciprocal prestations upon the
parties, the fruits and interest during the pendency of the condition shall be
deemed to have been mutually compensated. If the obligation is unilateral, the
debtor shall appropriate the fruits and interest received, unless from the nature
and circumstances of the obligation it should be inferred that the intention of the
person constituting the same was different.
In obligation to do and not to do, the courts shall determine, in each case, the
retroactive effect of the condition that has been complied with.
Retroactive effects of fulfillment of suspensive condition
1. In obligation to give – becomes demandable only upon the fulfillment of the
condition. However, once the condition is fulfilled its effect shall retroact to the
day when the obligation was constituted.
Ex. S agreed to sell his land to B if he lose a case. April 10, S sold his land to C.
Dec. 4 B lost the case. B has no right before dec. 4. When the condition is
fulfilled B as better right than C.
2. In obligation to do or not to do – no fixed rule is provided.
 Ex. C obliged himself to condoned debt of D, his lawyer, if D win the case. Upon
fulfillment of condition, C shall not be entitled.
Retroactive effects as to fruits and interests in obligation to give.
1. In reciprocal obligations – there is no retroactivity because the fruits and interest
received during the pendency of condition are deemed to have been mutually
compensated.
Ex. When B, lost his case on dec. 4, s must deliver the land and B must pay 50K.
S does not have to give the fruits received from the land before dec. 4 and B is
not obliged to pay legal interest on price.
2. In unilateral obligations – usually no retroactive effect because they are
gratuitous. Debtor receives nothing from the creditor. Fruits and interest belong
to the debtor.
Ex. Upon fulfillment of condition, S has to deliver the land but he has the right to
keep the fruits and interest during pendency.
Article 1188. The creditor may, before the fulfillment of the condition, bring the
appropriate actions for the preservation of his right.
The debtor may recover what during the same times he has paid by mistake in
case of suspensive condition.
Rights pending fulfillment of suspensive condition
1. Rights of Creditor – he may take o bring appropriate actions for the preservation
of his right. He may go to court to prevent the alienation or concealment of the
property the debtor has bound himself to deliver, or to have his right annotated
on thte title to the property in the registry of deeds.
2. Rights of Debtor – entitle to recover that he has paid by mistake prior to the
happening of suspensive condition. (Solutio indebiti)
Article 1189. When the conditions have been imposed with the intention of
suspending the efficacy of an obligation to give, the following rules shall be
observed in case of the improvement, loss or detoriation of the thing during
the pendecy the condiiton:
1. If the thing is lost without the fault of the debtor, the obligation shall be
extinguished
2. If the thing is lost through the fault of the debtor, he shall be obliged to
pay damages; it is understood that the thing is lost when it perishes, or
goes out of commerce, or disappears in such a way that its existence is
unknown or it cannot be recovered;
 3. When the thing detoriates without the fault of the debtor, the impairment
is to be done by the creditor;
4. If it detoriates through the fault of the debtor, the creditor may chose
between the rescission of the obligation and its fulfillment, with
indemnity for damages in either case
5. If the thing is improved by its nature, or by time, the improvement shall
inure to the benefit of the creditor
6. If it is improved at the expense of the debtor, he shall have no other
right than that granted to the usufructuary
Requisites for application of Article 1189
a) Obligation is a real obligation
b) Object is a specific or determinate thing
c) Subject is subject to a suspensive condition
d) Condition is fulfilled
e) There is loss, deterioration, or improvement of the thing during the pendency of
the condition.
Kinds of Loss
Loss in civil law may be:
a) Physical loss – when a thing perishes as when a house is burned and reduced to
ashes
b) Legal loss – when a thing goes out of commerce or when a thing heretofore legal
becomes (ex. During Japanese occupation, American dollars had become
impossible since their use was forbidden by the belligerent occupant)
c) Civil loss – when a thing disappears in such a way that its existence is unknown
(particular dog has been missing); or even if known, it cannot be recovered,
whether as a matter of fact (particular ring is dropped from ship at sea) or of law
(property lost through prescription)
Rules in case of loss, deterioration, or improvement of thing during pendency of
suspensive condition.
1. Loss of thing without debtor’s fault
Ex. X obliged himself to give Y his car worth 100K, if Y will sell X’s property. The car
was lost w/o the fault of X.
2. Loss of thing through debtor’s fault
Ex. If the loss of car due to negligence of X, Y will be entitled to demand damages.

3. Deterioration if thing without debtor’s fault – when it’s value is reduced or impaired
with or without fault of the debtor
Ex. If the car figured in an accident, broken windshield and scratched paint away
without fault of X, reducing its value to 90k, Y will have suffered the 10K
4. Deterioration of thing through debtor’s fault
Ex. Y may choose
a. Rescission (cancellation) of obligation; X is liable to pay for 100k, value of car
before deterioration plus incidental damages
b. Fulfillment of the obligation with damages. X is bound to give car and pay 10k
plus incidental damages to Y.
5. Improvement of thing by nature or by time
- A thing is improved when its value is increased or enhanced by nature or by time or at
the expense of the debtor or creditor.
Ex. Suppose the market value of car increased, benefit shall inure to Y.
6. Improvement of thing at expense of debtor
Ex. During pendency of condition, X had the car painted and its seat cover changed at
his expense. X will have the right to Usufructuary.
Usufruct – right to enjoy the use and fruits of thing belonging to another. He shall have
no right to indemnified. He may, however remove such improvement if possible without
damaging the property.
Articl 1190. When the conditions have for their purpose the extinguishment of an
obligation to give, the parties, upon the fulfillment of said conditions, shall return
to each other what they have received.
In case of loss, deterioration, or improvement of the thing, the provisions which,
with respect to the debtor, are laid down in the preceding article shall be applied
to the party who is bound to return.
As for obligaitons to do and not to do, the provisions of the second paragraph of
the article 1187 shall be observed as regards the effect of the extinguishment of
the obligation.
Effects and fulfillment of resolutory condition
 1. In obligation to give - obligation is extinguished and the parties are obliged to
return to each other what they have received under the obligation.
a) There is a return to the status quo. Effect of fulfillment of the condition is
retroactive.
b) In case the thing to be returned is legally in the possession of the third
person who did not act in bad faith, the remedy of the party entitled to
restitution is against the other.
c) Obligation of mutual restitution is absolute. Applies also to the fruits and
interests.
d) Obligation to give subject to suspensive condition, the retroactivity admits
exceptions according as the obligation as bilateral or unilateral.
2. In obligation to do or not to do – the courts shall determine the retroactive effect
of the fulfillment of the resolutory condition as in the case where the condition is
suspensive.
Applicability of Article 1189 to party with obligation to return
Ex. X obliges himself to let Y borrow his car until he return from province. X is the debtor
while Y is the creditor. Upon the happening of condition, X becomes the creditor, he has
the right to demand the return of car and Y have the obligation to return.
- Sa part ni debtor (X) resolutory while kay creditor (Y) is suspensive.
Article 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.
Kind of obligation according to the person obliged.
They are:
1. Unilateral – only one party is obliged to comply.
2. Bilateral – both parties are mutually bound to each other.
 a) Reciprocal obligations – arise from the same cause and in which each
party is a debtor and creditor. Performance of one is designed to be the
equivalent and the condition for the performance of the other of his own
obligation.
b) Non-reciprocal – do not impose simultaneous and correlative performance
on both parties. Performance of one party is not dependent upon the
simultaneous performance by the other
Remedies in reciprocal obligations
1. Choice of remedies – in case one of the obligors does not comply;
a) Action for specific performance (fulfillment) of the obligation with damages
b) Action for rescission of the obligation also with damages
2. Remedy of rescission for non-compliance – the remedy is granted for breach by
the other contracting party that violates the reciprocity between them
*when a party demands rescission in reciprocal obligations, treats the non-fulfillment
by the other party in default a term or period for the performance of his obligation as
resolutory condition
Court may grant guilty party term for performance
- only applies where the guilty party is willing to comply but need time to do so and
not where he refuses to perform.
Remedies are alternative
Remedies of injured is privilege to choose only one of the remedies. He may also
seek rescission even after he has chosen fulfillment if the latter should become
impossible. After choosing rescission, he cannot demand its compliance.
Limitations on right to demand rescission
1. Resort to the courts – The injured party has to resort to courts to assert his
right judicially. No person can take justice or law in his own hand. Other party
must be given opportunity to be heard.
2. Power of court to fix period – court has discretionary power to allow a period
within which a person in default may be permitted to perform his obligation.
3. Right of Third person – subject matter is in the hand of third person who acted
in good faith, rescission is not a remedy.
4. Substantial Violation – rescission will not be granted for slight, breaches of
contract. Violation should be substantial (considerable worthy)
 5. Waiver of Right – right to rescind may be waived (refrain) expressly (clear) or
implied (not direct). Ex. Seller acceptance of land as security for balance is
implied. Remedy is to recover balance.

Rescission without previous judicial decree

1. Where automatic rescission expressly stipulated – parties may validly enter
into agreement that violation of the contract would cause cancellation thereof
even without intervention of court.
2. Where contract still executory – no performance yet by both parties, but one
is ready and willing to comply and other is not. Willing party may rescind the
contract. If other party oppose, the he is free to resort to court, and only final
decision can settle whether rescission was proper or not.
Article 1192. In case both parties have committed a breach of the obligation, the
liability of the first infractor shall be equitably tempered by the courts. If it cannot
be determined which of the parties first violated the contract, the same shall be
deemed extinguished, and each shall bear hiw own damages.
Where both party are guilty of breach
1. First infractor known - first party to violate should be equitably reduced
2. First infractor cannot be determined – contract shall be deemed extinguished
and each shall bear his own damages.
* court shall not provide remedy for both parties.