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Art. 1179. Every obligation whose performance does not depend upon a future or uncertain event, or upon a past event unknown to the parties, is demandable at once.

Every obligation which contains a resolutory condition shall also be demandable, without prejudice to the effects of the happening of the event.¹

Art. 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 1197.²

Pure Obligations. — The effects as well as the concept of pure obligations are contained in the formula which is given in the fi rst paragraph of Art. 1179, although, as Castan says, the concept is incomplete because it only excludes the condition and not the term.³ Using the provision as a basis and bearing in mind this criticism, we can, therefore, defi ne a pure obligation as one whose effectivity or extinguishment does not depend upon the fulfi llment or nonfulfi llment of a condition or upon the expiration of a term or period, and which, as a consequence, is characterized by the quality of immediate demandability.

The distinctive characteristic of a pure obligation is its imme-diate demandability. This quality, however, must not be understood

1Art. 1113, Spanish Civil Code.

2New provision.

33 Castan, 7th Ed., p. 104.

OBLIGATIONS

in such a way as to lead to absurd interpretations which would lit-erally require the obligor or debtor to comply immediately with his obligation. A distinction must be made between the immediate de-mandability of the obligation and its performance or fulfi llment by the obligor or debtor. Although the obligee or creditor can demand the performance of the obligation immediately, the quality of imme-diate demandability is not infringed or violated when a reasonable period is granted for performance.⁴ Thus, where the debtor had ex-ecuted a simple and unconditional promissory note promising to pay a certain indebtedness to the creditor without fi xing any particular date for payment, it was held that the obligation is pure and that, although the creditor can demand for the payment of the same im-mediately, a reasonable period of grace, which in this case was fi xed at ten days after the obligation was contracted, should be given to the debtor within which to pay.⁵

Conditional Obligations. — In its juridical sense, a condi-tion may be defi ned as a future and uncertain fact or event upon which an obligation is subordinated or made to depend. A condi-tional obligation may, therefore, be defi ned as one whose effectivity is subordinated to the fulfi llment or nonfulfi llment of a future and uncertain fact or event.⁶

Although the fi rst paragraph of Art. 1179 would seem to indicate that either the requisite of futurity or uncertainty would be suffi cient in order that the event upon which the performance of the obligation shall depend will be considered a condition, it is, however, essential that both requisites must concur. In other words, the event must not only be future, but it must also be uncertain. The reason why the disjunctive term is used is that said paragraph is intended primarily as a defi nition of a pure obligation using the process of exclusion. Hence, it must exclude not only conditional obligations, but also obligations with a term.⁷

From the literal text of the fi rst paragraph of Art. 1179, it seems that a past but uncertain event is also considered a condition.

48 Manresa, 5th Ed., Bk 1, pp. 305-306.

5Floriano vs. Delgado, 11 Phil. 154; for other cases — see People’s Bank vs.

Odom, 64 Phil. 128; Galar vs. Isasi; Aberri vs. Galar, CA, 47 Off. Gaz. 6241.

68 Manresa, 5th Ed., Bk 1, p. 309.

7Ibid., pp. 309-310.

Arts. 1179-1180

This is not, however, accurate. The event itself can never constitute a condition because in order that it can be classifi ed as such, the requisites of futurity and uncertainty must be present. But the proof or ascertainment of the fact or event, as distinguished from the fact or event itself, may constitute either a condition or a term depending upon the circumstances of each case.

Thus, if the proof or ascertainment of the fact or event will surely come to pass, although it may not be known when, it is clear that it constitutes a term or period, such as when A promises to pay B a certain sum of money if the latter can prove by proper authorities that the Civil Code of the Philippines took effect on Aug. 30, 1950. In such case, the requisites of futurity and certainty in order that a fact or event shall constitute a term or period are certainly present. On the other hand, if the past event is unknown to the parties as well as to the whole world, so that the proof or ascertainment thereof may or may not happen or come to pass, it is also clear that it constitutes a condition, such as when A promises to pay B a certain sum of money if the latter can prove by proper evidence that Rizal did not retract Freemasonry, or that a priest broke the seal of the confessional in order to reveal the secret of the Katipunan.

However, 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 Art. 1197.⁸ Consequently, the courts shall determine such period as may under the circumstances have been probably contemplated by the parties. Once fi xed by the courts, the period cannot be changed by them.⁹ Thus, it has been held that if it is stipulated by the contracting parties that the debtor shall pay “as soon as he has the money,” the creditor’s remedy is to resort to the courts for the determination of the duration of the period in accordance with the provisions of Art. 1197 of the Code.¹⁰

Idem; Classifi cation of conditions. — Conditions are traditionally classifi ed as follows:

(1) a. Suspensive — when the fulfi llment of the condition results in the acquisition of rights arising out of the obligation.

8Art. 1197, Civil Code.

9Art. 1180, Civil Code.

10Patente vs. Omega, 49 Off. Gaz. 4846.

DIFFERENT KINDS OF OBLIGATIONS Arts. 1179-1180 Pure and Conditional Obligations

OBLIGATIONS

b. Resolutory — when the fulfi llment of the condition results in the extinguishment of rights arising out of the obligation.

(2) a. Potestative — when the fulfi llment of the condition depends upon the will of a party to the obligation.

b. Casual — when the fulfi llment of the condition depends upon chance and/or upon the will of a third person.

c. Mixed — when the fulfi llment of the condition depends partly upon the will of a party to the obligation and partly upon chance and/or the will of a third person.

(3) a. Possible — when the condition is capable of realization according to nature, law, public policy or good customs.

b. Impossible — when the condition is not capable of realization according to nature, law, public policy or good customs.

(4) a. Positive — when the condition involves the performance of an act.

b. Negative — when the condition involves the omission of an act.

(5) a. Divisible — when the condition is susceptible of partial realization.

b. Indivisible — when the condition is not susceptible of partial realization.

(6) a Conjunctive — when there are several conditions, all of which must be realized.

b. Alternative — when there are several conditions, but only one must be realized.

(7) a. Express — when the condition is stated expressly.

b. Implied — when the condition is tacit.¹¹

118 Manresa, 5th Ed., Bk. 1, pp. 323-324.

Arts. 1179-1180

Art. 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.¹²

Suspensive and Resolutory Conditions. — A suspensive condition (condition precedent) is a future and uncertain event upon the happening or fulfi llment of which rights arising out of the obligation are acquired. Stated in another way, it signifi es a future and uncertain event upon the fulfi llment of which the obligation becomes effective. Hence, when the obligation depends upon a suspensive condition, the acquisition of rights by the obligee or creditor is subordinated to the fulfi llment of the event which constitutes the condition. In other words, the birth or effectivity of the obligation is suspended until the happening or fulfi llment of the event which constitutes the condition. Thus, if A obligates himself to give to B P100,000 if the latter gets married to C, the condition is suspensive in character. In such case, B cannot acquire the P100,000 unless he gets married to C. If X obligates himself to give to Y a certain house and lot if the latter passes the bar examinations in his fi rst attempt, the condition is also suspensive in character. He cannot acquire the house and lot unless the condition is fulfi lled.

It is, therefore, evident that when the obligation is subject to a suspensive condition, its birth or effectivity can take place only if and when the event which contitutes the condition happens or is fulfi lled. Thus, the Supreme Court, in the case of Javier vs. Court of Appeals (183 SCRA 172) held that when a contract is subject to a suspensive condition, its birth or effectivity can take place only if and when the event which constitutes the condition happens or is fulfi lled. If the suspensive condition does not take place, the parties would stand as if the conditional obligation had never existed.

A resolutory condition (condition subsequent), on the other hand, is a future and uncertain event upon the happening or fulfi llment of which rights which are already acquired by virtue of the obligation are extinguished or lost. Hence, when the obligation is subject to a resolutory condition, the juridical relation which is established as a result of the obligation is subject to the threat of extinction. Thus, if a person donates a parcel of land to the City of Manila subject to the

12Art. 1114, Spanish Code.

DIFFERENT KINDS OF OBLIGATIONS Art. 1181 Pure and Conditional Obligations

OBLIGATIONS

condition that the City shall transform it into a public park within a period of one year from the time of the perfection of the donation, the condition which is imposed is resolutory in character. If the City fails to transform the land into a public park within the stipulated period, the rights which it acquired over the land as a result of the donation are resolved or extinguished altogether. The same is true in case a person sells a parcel of land with right of repurchase. Once the sale with pacto de retro is perfected, the vendee a retro becomes the owner of the property. However, his right is not absolute in character because it may be extinguished or lost if the vendor a retro exercises his right of repurchase within the legal or stipulated period of redemption.

Idem; Effects. — It is, therefore, clear from what had been stated that if an obligation is subject to a suspensive condition, the acquisition of rights shall depend upon the happening or fulfi llment of the fact or event which constitutes the condition.¹³ In other words, the obligation shall become effective only upon the fulfi llment of the condition. Consequently, what is acquired by the obligee or creditor upon the constitution of the obligation is only a mere hope or expectancy. Unlike other hopes or expectancies, however, it is protected by the law.¹⁴

On the other hand, if the obligation is subject to a resolutory condition, it becomes demandable immediately after its establishment or constitution. This is evident from the provision of the second paragraph of Art. 1179. Consequently, unlike an obligation with a suspensive condition, rights arising out of the obligation are acquired immediately and vested in the obligee or creditor.¹⁵ However, this is without prejudice to the happening or fulfi llment of the event which constitutes the condition. In other words, although rights are immediately vested in the obligee or creditor upon the constitution of the obligation, such rights are always subject to the threat or danger of extinction. Thus, in the case of a sale with pacto de retro, the vendee a retro becomes the owner of the property which is sold once it is delivered to him. This right of ownership, however, is subject

13Art. 1181, Civil Code; for illustrative cases, see Wise & Co. vs. Kelly, 37 Phil.

696; Santiago vs. Millar, 68 Phil. 39; Phil. Nat. Bank vs. Phil. Trust Co., 68 Phil. 48;

Panganiban vs. Batangas Trans. Co., CA, 46 Off. Gaz. 3167.

14Art. 1188, Civil Code; Phil. Long Distance Co. vs. Jeturian, 97 Phil. 981.

15Art. 1181, Civil Code.

Art. 1181

to a resolutory condition. If the vendor a retro exercises his right of repurchase within the period of redemption, the right of the vendee a retro over the property is extinguished; if he does not, the right is consolidated.¹⁶

Problem — On June 5, 1960, DP delivered possession of his house and lot in the Poblacion of Polo, Bulacan to AB who in turn delivered to the former possession of his 2-hectare rice land.

Both properties were unregistered. They executed a document entitled “Barter’’ which, among others, provided that both parties shall enjoy the material possession of their respective properties: that neither party shall encumber, alienate or dispose of their respective properties as bartered without the consent of the other; and that DP shall be obliged to return the property to AB when the latter’s son shall attain majority and decide to return DP’s property. After AB’s death and his son S attained majority in 1977, the latter demanded for the return of the 2 hectares of rice land which had then increased tremendously in value. DP refused and so S fi led an action for recovery of the land. Will the action prosper? Why? (1979 Bar Problem)

Answer — Yes, the action will prosper. The stipulations in the barter agreement are clear. All that the parties intended was to transfer the material possession and use of the subject properties to the other. There was, therefore, no conveyance of their right of ownership. In fact, the parties retained their rights to alienate their right of ownership, a right which is one element of ownership. What was, therefore, transferred was merely their right of usufruct. But then, the document also says that DP shall be obliged to return the property to AB when the latter’s son shall attain majority and decide to return DP’s property.

The mutual agreement, therefore, was subject to a resolutory condition the happening of which would extinguish or terminate their right of usufruct over the subject properties. The facts are clear. Said condition has already been fulfi lled. (Baluran vs.

Navarro, 79 SCRA 309.)

It is, therefore, evident that a resolutory condition affects the obligation to which it is attached in a manner which is diametrically opposed to that of a suspensive condition. If the suspensive condition is fulfi lled, the obligation arises or becomes effective; if the resolutory

16Art. 1601, et seq., Civil Code.

DIFFERENT KINDS OF OBLIGATIONS Art. 1181 Pure and Conditional Obligations

OBLIGATIONS

condition is fulfi lled, the obligation is extinguished. If the fi rst is not fulfi lled, no juridical relation is created; if the second is not fulfi lled, the juridical relation is consolidated. In other words, in the fi rst, rights are not yet acquired, but there is a hope or expectancy that they will soon be acquired; in the second, rights are already acquired, but subject to the threat of extinction.¹⁷

These distinctions between a suspensive and a resolutory condition are illustrated in the following case:

Parks vs. Province of Tarlac 49 Phil. 142

Plaintiff bought the land which is the subject matter of this litigation from Concepcion Cirer and James Hill, who, several years ago, prior to the sale, had donated the land to the municipality of Tarlac subject to the condition that it will be used absolutely and exclusively for the erection of a central school and a public park, the work to commence within a period of six months from the date of ratifi cation of the donation by the parties. The question now is: has the plaintiff a right of action to recover the parcel of land from the municipality of Tarlac on the ground that the condition imposed is suspensive, and therefore, the said municipality had never acquired a right thereto since the condition was never performed?

Held: “The appellant contends that a condition precedent having been imposed in the donation and the same not having been complied with, the donation never became effective. We fi nd no merit in this contention. The appellant refers to the condition imposed that one of the parcels donated was to be used absolutely and exclusively for the erection of a central school and the other for a public park, the work to commence in both cases within the period of six months from the date of the ratifi cation by the parties of the document evidencing the donation. lt is true that this condition has not been complied with. The allegation, however, that it is a condition precedent is erroneous. The characteristic of a condition precedent is that the acquisition of the right is not effected while said condition is not complied with or is not deemed complied with. Meanwhile, nothing is acquired and there is only an expectancy of right.

Consequently, when a condition is imposed, the compliance

178 Manresa, 5th Ed., Bk. 1, p. 311.

Art. 1181

of which cannot be effected except when the right is deemed acquired, such condition cannot be a condition precedent. In the present case, the condition that a public school be erected and a public park made on the donated land, work on the same to commence within six months from the date of the ratifi cation of the donation by the parties, could not be complied with except after giving effect to the donation. The donee could not do any work on the donated land if the donation had not really been effected, because it would be an invasion of another’s title, for the land would have continued to belong to the donor so long as the condition imposed was not complied with. The condition, therefore, was a condition subsequent.’’¹⁸

Art. 1182. When the fulfi llment 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.¹⁹

Potestative, Casual and Mixed Conditions. — As regards the cause upon which its fulfi llment depends, a condition may be either potestative, casual or mixed. A purely potestative condition is one whose fulfi llment depends exclusively upon the will of either one of the parties to the obligation. A casual condition is one whose fulfi llment depends exclusively upon chance and/or upon the will of a third person. A mixed condition is one whose fulfi llment depends

Potestative, Casual and Mixed Conditions. — As regards the cause upon which its fulfi llment depends, a condition may be either potestative, casual or mixed. A purely potestative condition is one whose fulfi llment depends exclusively upon the will of either one of the parties to the obligation. A casual condition is one whose fulfi llment depends exclusively upon chance and/or upon the will of a third person. A mixed condition is one whose fulfi llment depends