DISEÑO DE LA PROPUESTA
“CONTRATACIÓN MENOR” (CONSULTORÍAS INDIVIDUALES) Cuantía
Art. 1231. Obligations are extinguished: (1) By payment or performance:
(2) By the loss of the thing due:
(3) By the condonation or remission of the debt;
(4) By the confusion or merger of the rights of creditor and debtor;
(5) By compensation; (6) By novation.
Other causes of extinguishment of obligations, such as annulment, rescission, fulfillment of a resolutory condition, and prescription, are governed elsewhere in this Code.
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As a general rule, death of either the creditor or the debtor does not extinguish the obligation; obligations actively and passively, are transmissible to the heirs, except when the law, the stipulations of the parties, or nature of the obligation prevents such transmission
XPN:In obligations to do or which are personal, identified with the person himself; these are extinguished by death
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Section 1. - Payment or Performance
Art. 1232. Payment means not only the delivery of money but also the performance, in any other manner, of an obligation.
Payment is the fulfillment of the prestation due, a fulfillment that extinguishes the obligation by the realization of the purposes for which it was constituted
Requisites of payment:
1. The person who pays must be the debtor
2. The person to whom payment is made must be the creditor 3. The thing to be paid or to be delivered must be the precise thing or the thing required to be delivered by the creditor 4. The manner (if expressly agreed upon), time and place of payment, etc
Kinds of payment:
NORMAL ABNORMAL
When the debtor
voluntarily performs
the prestation
stipulated
When he is forced by means of a judicial proceeding, either to comply
with the prestation or to pay indemnity
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Art. 1233. A debt shall not be understood to have been paid unless the thing or service in which the obligation consists has been completely delivered or rendered, as the cas e may be.
________ Requisites for payment:
1. Identity of the prestation; that the very thing or service due must be delivered or released
2. Integrity; that the prestation must be fulfilled completely The payment or performance must be on the date stipulated. The failure to perform on the date stipulated is not excused by the fact that such date falls on a Sunday and the next day is a legal holiday, because payment may be made either on Sundays or on any holiday. Under some statutes, however, like the Negotiable Instruments Law, payment in such case may be on the next succeeding business day
When the existence of a debt is fully established by the evidence, the burden of proving that it has been extinguished by payment devolves upon the debtor who offers such a defense to the claim of the plaintiff creditor
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Art. 1234. If the obligation has been substantially performed in good faith, the obligor may recover as though there had been a strict and complete fulfillment, less damages suffered by the obligee.
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In order that there may be substantial performance of an obligation, there must have been an attempt in good faith to perform, without any willful or intentional departure therefrom. The deviation from the obligation must be slight, and the omission or defect must be technical and unimportant, and must not pervade the whole or be so material that the object which the parties intended to accomplish in a particular manner is not attained. The non-performance of a material part of a contract will prevent the performance from amounting to a substantial compliance
When one has received the benefits of substantial performance by the other without the price agreed upon, and he cannot or does not return these benefits, it is manifestly unjust to permit him to retain them without paying, or doing as he promised
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Art. 1235. When the obligee accepts the performance, knowing its incompleteness or irregularity, and without expressing any protest or objection, the obligation is deemed fully complied with.
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To constitute a waiver, there must be an intentional relinquishment of a known right. A waiver will not result from a mere failure to assert a claim for defective performance when the thing or work is received, or from mere payment in accordance with the terms of the contract. There must have been acceptance of the defective performance with actual knowledge of the incompleteness or the defect, under circumstances that would indicate an intention to consider the performance as complete and renounce any claim arising from the defect
The word accept used in this Article, means to take as satisfactory or sufficient, or agree to an incomplete or irregular performance
A creditor cannot object because of defects in performance resulting from his own acts or directions. And where a party makes particular objections to the sufficiency of performance, he is estopped to later set up other objections
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Art. 1236. The creditor is not bound to accept payment or performance by a third person who has no interest in the fulfillment of the obligation, unless there is a stipulation to the contrary.
Whoever pays for another may demand from the debtor what he has paid, except that if he paid without the knowledge or against the will of the debtor, he can recover only insofar as the payment has been beneficial to the debtor.
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The creditor cannot be compelled to accept performance by a third person who is not bound under the obligation, because whenever a third person pays there is a modification of the prestation that is due. It is believed that the creditor should have a right to insist on the liability of the debtor. A creditor should not be compelled to accept payment from a third person whom he dislikes or distrust
A person who pays a debt for the account of another may recover from the debtor the sum so paid out, at least to the extent in which the payment may have been beneficial to the debtor. Such a payment cannot be considered as a payment of what is not due under Article 2154, and cannot be recovered from the creditor by the person who paid; the right of the payor in such case is against the debtor whose obligation he has paid. The debtor who knows that another has paid his obligation for him, and who does not object thereto or repudiate the same at any time, must pay the amount advanced by the third person
Generally, the third person who paid another’s debt is entitled to recover the full amount he had paid. The law, however, limits his recovery to the amount by which the debtor has been benefited, if the debtor has no knowledge of, or has expressed his opposition to such payment
It is optional for the creditor to accept payment from a third person. If the debtor opposes the payment by a third person, the latter will be entitled to recover from the debtor only to the extent that the payment has benefited him. But as between the debtor and the creditor, the obligation is extinguished
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Art. 1237. Whoever pays on behalf of the debtor without the knowledge or against the will of the latter, cannot compel the creditor to subrogate him in his rights, such as those arising from a mortgage, guaranty, or penalty.
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The right to recover from the debtor is based in the mere fact of payment and on considerations of justice; but it gives to the third person who paid only simple personal action for reimbursement, without the securities, guaranties, and other rights recognized in the creditor, which are extinguished by the payment
From the language of this article, it would seem that there may be subrogation if the creditor willingly and spontaneously permits the third person who has paid to be subrogated in his rights, even without the consent of the debtor. Such interpretation, however, is not proper. There is no provision giving such right to the creditor; the provisions of this article are for the benefit of the debtor, and cannot be renounced by the creditor; the third person is amply protected by his right to reimbursement. It is clear, however, that the creditor may assign his rights to a third person; but in such case, the resulting rights and obligations of the creditor and the third person would be different from those arising from payment
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Art. 1238. Payment made by a third person who does not intend to be reimbursed by the debtor is deemed to be a donation, which requires the debtor's consent. But the payment is in any case valid as to the creditor who has accepted it.
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Art. 1239. In obligations to give, payment made by one who does not have the free disposal of the thing due and capacity to alienate it shall not be valid, without prejudice to the provisions of Article 1427 under the Title on "Natural Obligations."
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Where the person paying has no capacity to make the payment, the creditor cannot be compelled to accept it; consignation will not be proper; in case he accepts it, the payment will not be valid, except in the case provided in Article 1427
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Art. 1240. Payment shall be made to the person in whose favor the obligation has been constituted, or his successor in interest, or any person authorized to receive it.
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The authority of a person to receive payment for the creditor may be legal or conventional
LEGAL CONVENTIONAL
When conferred by
law, such as the
authority of a guardian
When the authority has been given by the creditor himself, as when an agent is appointed to collect from the
of an incapacitated
creditor, or the
administrator of the estate of a deceased creditor
debtor. The debtor may be
authorized by the creditor to make the payment to another, whether the latter be his representative or not
The payment of a debt must be made to the person in whose favor the obligation is constituted, or to another authorized to receive the payment in his name
Payment made by the debtor to a wrong party does not extinguish the obligation as to the creditor, if there is no fault or negligence which can be imputed to the latter. Even when the debtor acted in utmost good faith and by mistake as to the person of his creditor, or through error induced by the fraud of the third person, the payment to one who is not in fact his creditor, or authorized to receive such payment, is void, except as provided in Article 1241. Such wrong payment does not prejudice the creditor, and accrual of interest is not suspended by it
The deposit of the amount of the obligation by the debtor in a bank, in the name and to the credit of the creditor, without the authorization of the latter, does not constitute payment; but when the creditor cannot be found in the place of payment, such deposit may be a valid excuse for not holding the debtor in default
Generally, consignation in court of the thing or amount due, when properly made, will extinguish the obligation. But where the creditor institutes an action for the collection of the amount of the obligation, with the corresponding interest, and the debtor deposits the amount in court, but in a different case which is separate and distinct in nature from the case in which payment is demanded, such deposit does not amount to payment
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Art. 1241. Payment to a person who is incapacitated to administer his property shall be valid if he has kept the thing delivered, or insofar as the payment has been beneficial to him. Payment made to a third person shall also be valid insofar as it has redounded to the benefit of the creditor. Such benefit to the creditor need not be proved in the following cases:
(1) If after the payment, the third person acquires the creditor's rights;
(2) If the creditor ratifies the payment to the third person; (3) If by the creditor's conduct, the debtor has been led to believe that the third person had authority to receive the payment.
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When the creditor is incapacitated to receive payment, this must be made to his legal representative if there is one. If there be none, then the debtor may relieve himself of responsibility by delivering the thing to the court in consignation, by virtue of Article 1256
If the payment is made to the creditor who is incapacitated, it shall be valid only in so far as it accrued to his benefit. In the absence of this benefit, the debtor may be made to pay again
by the incapacitated himself when he attains capacity, or his legal representative during such incapacity
The payment shall be considered as having benefited the incapacitated person, if he made an intelligent and reasonable use thereof, for purposes necessary or useful to him, such as that which his legal representative would have or could have done under similar circumstances, even at the time of the complaint the effect of such use no longer exists. It is not necessary, however, that there be actual investment or use of the thing. The benefit is deemed to exist also when the thing paid is preserved or kept to be applied to rational purposes for the benefit of the incapacitated
The debtor is not released from liability by a payment to one who is not the creditor nor one authorized to receive the payment, even if the debtor believed in good faith that he is the creditor, except to the extent that the payment inured to the benefit of the creditor
In the following cases, in addition to those enumerated by this article, payment to a third person releases the debtor:
(1) When, without notice of the assignment of the credit, he pays to the original creditor (Article 1626)
(2)When in good faith he pays to one in possession of the credit (Article 1242)
Even when the creditor receives no benefit from the payment to a third person, he cannot demand payment anew, if the mistake of the debtor was due to the fault of the creditor
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Art. 1242. Payment made in good faith to any person in possession of the credit shall release the debtor.
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This article constitutes an exception to the rule that payment must be made to the creditor or his authorized representative. The person in possession of the credit is neither the creditor nor one authorized by him to receive payment, but appears under the circumstances of the case, to be the creditor. He appears to be the owner of the creditor, although in reality he may not be the owner
This article refers to possession of the credit, and not merely of the document representing the credit
Payment to the possessor of the document or title does not necessarily extinguish the credit (i.e. payable to bearer/ order) The good faith of the debtor consists in the belief that the party who presents the title of the obligation is the true creditor, or that the person to whom the payment is made is the owner of the credit
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Art. 1243. Payment made to the creditor by the debtor after the latter has been judicially ordered to retain the debt shall not be valid.
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The payment to the creditor after the credit has been attached or garnished, is void as to the party who obtained the attachment or garnishment, to the extent of the amount of the
judgment in his favor. The debtor can therefore be made to pay again to the party who secured the attachment or garnishment, but he can recover to the same extent what he has paid to his credit
The debtor upon whom a garnishment order is served, can always deposit the money in court by way of consignation, and thus relieve himself of further liability
If the debt is already due, he can even be compelled judicially by the attaching creditor to make the consignation in court, because he would have no more right to retain the debt
If the action of the attaching or garnishing creditor fails, then the garnishment is of no effect, because it is only incidental or accessory to the main action. The payment which the garnishee has made to his creditor (defendant in the action) must be considered as valid and extinguishes the former’s liability to the latter
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Art. 1244. The debtor of a thing cannot compel the creditor to receive a different one, although the latter may be of the same value as, or more valuable than that which is due.
In obligations to do or not to do, an act or forbearance cannot be substituted by another act or forbearance against the obligee's will.
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The debtor of a thing cannot compel the creditor to receive a different one although the latter may be of the same value than that which is due. Upon agreement or consent of the creditor, the debtor may deliver a different thing or perform a different prestation in lieu of that stipulated. In this case there may be dation in payment (Article 1245) or novation (Article 1291) The defects of the thing delivered may be waived by the creditor, if he expressly so declares, or if, with knowledge thereof, he accepts the thing without protest or disposes of it or consumes it
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Art. 1245. Dation in payment, whereby property is alienated to the creditor in satisfaction of a debt in money, shall be governed by the law of sales.
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The dation in payment extinguishes the obligation to the extent of the value of the thing delivered, either as agreed upon by the parties or as may be proved, unless the parties by agreement, express or implied, or by their silence, consider the thing as equivalent to the obligation, in which case the obligation is totally extinguished. (8 Manresa 324; 3 Valverde 174 fn.) In Caltex (Phil.), Inc., v. IAC, 215 SCRA 580: It is clear that a dation in payment does not necessarily mean total extinguishment of the obligation. The obligation is totally extinguished only when the parties, by agreement, express or implied, or by their silence, consider the thing as equivalent to the obligation.
Dation in payment is an onerous contract of alienation because the object is given in exchange of the credit. The provisions on sales, regarding warranty against eviction and hidden defects of
the thing, are therefore applicable, the debtor being considered as the vendor
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Art. 1246. When the obligation consists in the delivery of an
indeterminate or generic thing, whose quality and
circumstances have not been stated, the creditor cannot demand a thing of superior quality. Neither can the debtor deliver a thing of inferior quality. The purpose of the obligation and other circumstances shall be taken into consideration.
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In cases falling under this article, if there is disagreement between the debtor and the creditor as to the quality of the