Art 1348- 1358 Summary of OBLICON by DE LEON PDF

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SECTION 2. — Object of ContractsART. 1348. Impossible things or services cannot bethe object of contracts. (1272)Concept of object of a contractThe object of a contract is its subject matter.Kinds of object of contractObject certain is the second essential element of a valid contractContracts can be...

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SECTION 2. — Object of Contracts ART. 1348. Impossible things or services cannot be the object of contracts. (1272)

The exceptions are when they are intransmissible by their nature, or by stipulation, or by provision of law. (Art. 1311, par. 1.)

EXAMPLES: Concept of object of a contract The object of a contract is its subject matter. Kinds of object of contract Object certain is the second essential element of a valid contract

Contracts can be: a. things (as in sale of property) b. rights (as an assignment of credit) c. services (as in agency) Requisites of things as object of contract In order that things may be the object of a contract, the following requisites must be present: (1) The thing must be within the commerce of men, that is, it can legally be the subject of commercial transaction (Art. 1347.); (2) It must not be impossible, legally or physically (Art. 1348.) (3) It must be in existence or capable of coming into existence (see Arts. 1461, 1493, 1494.); and (4) It must be determinate or determinable without the need of a new contract between the parties. (Arts. 1349, 1460, par. 2.) Requisites of services as object of contract

(1) Outside the commerce of men. 2) Impossible, physically or legally (3) Determinable things (4) Future things or rights (5) Intransmissible rights Meaning of future inheritance Future inheritance is any property or right, not in existence or capable of determination at the time of the contract, that a person may inherit in the future. Requisites of inheritance to be considered future A contract may be classified as a contract upon future inheritance where the following requisites concur: (1) The succession has not yet been opened at the time of the contract; (2) The object of the contract forms part of the inheritance; and (3) The promissor has, with respect to the object, an expectancy of a right which is purely hereditary in nature. Validity of contracts upon future inheritance Except in cases expressly authorized by law, a contract concerning future inheritance is void and consequently, cannot be the source of any right nor the creator of any obligation between the parties.

In order that service may be the object of a contract, the following requisites must concur:

Exceptions: The law permits contracts on future inheritance —

(1) The service must be within the commerce of men;

(1) in the case of future spouses who agree in their marriage settlements upon a regime other than the absolute community of property, they may donate to each other as much as one-fi fth of their present property, but with respect to their future property, such donations shall be governed by the provisions on testamentary succession and the formalities of wills. (Art. 84, Family Code.) This means that such donations (by reason of marriage) of future property shall take effect only in the event of death, to the extent laid down by law in testamentary succession; and

(2) It must not be impossible, physically or legally (Art. 1348.); and (3) It must be determinate or capable of being made determinate. (Arts. 1318[2], 1349.) Rights as object of contract As a general rule, all rights may be the object of a contract.

(2) in the case of partition of property by act inter vivos by a person (i.e., owner or source of the property) to take effect upon his death. (Art. 1080; see Arroyo vs. Gerona, 58 Phil. 226 [1933].) Partition of property representing future inheritance cannot be made effective during the lifetime of the owner. (Arrogante vs. Deliarte, 528 SCRA 63 [2007].) Future inheritance cannot be renounced. (Uson vs. Del Rosario, 92 Phil. 531 [1952].) Inheritance ceases to be future upon death of decedent Upon the death of the deceased who is the source of the property, however, future inheritance ceases to be future and consequently, may be the object of a contract.

contract, such as blindness in contracts which require the use of eyesight. (8 Manresa 685.) ART. 1349. The object of every contract must be determinate as to its kind. The fact that the quantity is not determinate shall not be an obstacle to the existence of the contract, provided it is possible to determine the same, without the need of a new contract between the parties. (1273) Quantity of object of contract need not be determinate It is sufficient that it is possible to determine the same without the need of a new contract between the parties. When the obligation consists in the delivery of a generic thing, whose quality and circumstances have not been stated, Article 1246 governs.

Kinds of impossibility

SECTION 3. — Cause of Contracts Impossibility may be: (1) Physical. — when the thing or service in the very nature of things cannot exist (e.g., a monkey that talks) or be performed. With particular reference to services (see Arts. 1266, 1267.), the impossibility may be: (a) Absolute. — when the act cannot be done in any case so that nobody can perform it (e.g., to fly like a bird, etc.); or (b) Relative. — when it arises from the special circumstances of the case (e.g., to make payment to a dead person, to drive a car on flooded highways, etc.) or the special conditions or qualifications of the obligor (to paint a portrait by a blind person, etc.); or (2) Legal. — when the thing or service is contrary to law, morals, good customs, public order, or public policy. Effect of physical impossibility on validity of contract (1) The absolute impossibility nullifies the contract (2) The relative impossibility, if temporary, does not nullify the contract, such as when a partner agrees to contribute to the partnership an amount more than is permissible by his means; if permanent, it annuls the

ART. 1350. In onerous contracts the cause is understood to be, for each contracting party, the prestation or promise of a thing or service by the other; in remuneratory ones, the service or benefit which is remunerated; and in contracts of pure beneficence, the mere liberality of the benefactor. (1274) Meaning of cause Cause (causa) is the essential or more proximate purpose or reason which the contracting parties have in view at the time of entering into the contract or, as expressed in another case, it is the “why of the contract, the essential reason which moves the contracting parties to enter into the contract.’’ Distinguished from the English doctrine of consideration The terms “cause” and “consideration ” are used interchangeably but there is an essential difference between the two. According to its accepted meaning in common law, consideration may consist either in some legal right, interest, benefit or advantage conferred upon the promissor, to which he is otherwise not lawfully entitled, or in some legal detriment, prejudice, loss or

disadvantage suffered or undertaken by the promisee other than to such as he is at the time of consent bound to suffer. Unlike the English principle, the continental doctrine never rejects any cause or consideration as insufficient. Whatever inducement is enough to satisfy the contracting parties, is enough to satisfy the law. (see Salmond, Jurisprudence)

ART. 1351. The particular motives of the parties in entering into a contract are different from the cause thereof. Meaning of motive Motive is the purely personal or private reason which a party has in entering into a contract. It is different from the cause of the contract.

Cause distinguished from object Cause distinguished from motive In a bilateral or reciprocal contract like purchase and sale, the cause for one is the subject matter or object for the other, and vice versa. Hence, the distinction is only a matter of viewpoint. Classification of contracts according to cause They are: (1) Onerous or one the cause of which, for words, in this contract, the parties are reciprocally obligated to each other each contracting party, is the prestation or promise of a thing or service by the other. In other. (2) Remuneratory or remunerative or one the cause of which is the service or benefit which is remunerated. The purpose of the contract is to reward the service that had been previously rendered by the party renumerated; and 3) Gratuitous or one the cause of which is the mere liberality of the benefactor or giver, such as commodatum; pure donation; guaranty or suretyship unless there is a stipulation to the contrary (Art. 2048.), mortgage given by a third person to secure an obligation of a debtor (see Art. 2085, last par.) unless a consideration is paid for such mortgage. Liberality as cause in contracts of beneficence Under Article 1350, the liberality of the benefactor is deemed causa only in those contracts that are of pure beneficence, that is to say, contracts designed solely and exclusively to procure the welfare of the beneficiary, without any intent of producing any satisfaction for the donor; contracts, in other words, in which the idea of self-interest is totally absent on the part of the transferor.

Motive has been defined as the condition of mind which incites to action, but includes also the inference as to the existence of such condition from an external fact of a nature to produce such a condition. The differences are as follows: (1) Cause is the immediate or direct reason, while motive is the remote or indirect reason; (2) Cause is always known to the other contracting party, while motive may be unknown; (3) Cause is an essential element of a contract, while motive is not; and (4) The illegality of the cause affects the validity of a contract, while the illegality of one’s motive does not render the contract void. When motive regarded as cause As a general principle, the motive or particular purpose of a party in entering into a contract does not affect the validity nor existence of the contract. Under certain circumstances, the motive may be considered the cause in a contract when such motive predetermines the cause of the contract.

ART. 1352. Contracts without cause, or with unlawful cause, produce no effect whatever. The cause is unlawful if it is contrary to law, morals, good customs, public order or public policy. (1275a)

ART. 1353. The statement of a false cause in contracts shall render them void, if it should not be proved that they were founded upon another cause which is true and lawful. (1276)

Requisites of cause

Effect of falsity of cause

The following are the requisites of cause:

By falsity of cause is meant that the contract states a valid consideration but such statement is not true.

(1) It must exist at the time the contract is entered into (Arts. 1352, 1409[3].); (2) It must be lawful (Ibid.); and (3) It must be true or real. (Art. 1353.)

Effect of absence of cause Absence or want of cause means that there is a total lack of any valid consideration for the contract. (1) Statement in contract of a non-existent cause. (2) Grant of right of first refusal Effect of failure of cause Absence of cause should be distinguished from inadequacy of cause which, as a general rule, is not a ground for relief (see Art. 1355.), and from failure of cause which does not render a contract void. (see Arts. 1169, par. 3; 1170, 1191.) Failure to pay the consideration is different from lack of consideration. The former results in a right to demand the fulfillment or cancellation of the obligation under an existing valid contract while the latter prevents the existence of a valid contract. Effect of illegality of cause

A false cause may be erroneous or simulated. The first always produces the inexistence of a contract. If the cause is false, the contract is rendered void because the same actually does not exist. The second does not always produce this effect, because it may happen that the hidden but true cause is sufficient to support the contract. If the parties can show that there is another cause and that said cause is true and lawful, then the parties shall be bound by their true agreement. ART. 1354. Although the cause is not stated in the contract, it is presumed that it exists and is lawful, unless the debtor proves the contrary. (1277) Cause presumed to exist and lawful It is not necessary that the cause be expressly stated in the contract. The presumption is that the cause exists and is lawful unless the debtor proves the contrary. ART. 1355. Except in cases specified by law, lesion or inadequacy of cause shall not invalidate a contract, unless there has been fraud, mistake or undue influence. TERMS:

Illegality of cause implies that there is a cause but the same is unlawful or illegal. The cause is unlawful if it is contrary to law, morals, good customs public order, or public policy. (see Art. 1306.) Contracts with unlawful cause are also null and void.

Lesion is any damage caused by the fact that the price is unjust or inadequate. TWO IMPORTANT CONCEPTS: Simulation of Contracts and Gross inadequacy of price ===both are distinct concepts.

===when the parties to an alleged contract do not really intend to be bound by it, the contract is simulated and void. ===A simulated or fictitious contract has no legal effect whatsoever because there is no real agreement between the parties. ===a contract with inadequate consideration may nevertheless embody a true agreement between the parties. EFFECT OF LESION OR INADEQUACY OF CAUSE: A. General Rule: Lesion or inadequacy of cause (e.g., price of thing sold) does not of itself invalidate a contract. B. Exemptions: Lesions will invalidate a contract if: (a) when there has been fraud, mistake, or undue influence (Art. 1355.); and (b) in cases specified by law. (see Art. 1381.) C. Related Provisions: a. Article 1098 b. Article 1470 c. Article 1539 d. Article 1542 e. Article 1602 D. Filial love or affection: — In a case, the Supreme Court did “not find the stipulated price as so inadequate to shock the court’s conscience considering that the price paid was much higher than the assessed value of the subject properties and considering that the sales were effected by a father to her daughter in which case filial love must be taken into account.” ===in short, Filial love or affection must be taken into consideration. Therefore, does not invalidate the contract. As long as there is the absence of FRAUD.

some form in order that it may be valid or enforceable, or that a contract be proved in a certain way, that requirement is absolute and indispensable. In such cases, the right of the parties stated in the following article cannot be exercised. TERMS: The form of a contract refers to the manner in which a contract is executed or manifested. FORMS OF CONTRACTS 1. Can be: a. parol or oral b. in writing c. partly oral and partly writing (maybe in public or private instrument) 2. Can be: a. contained in a SINGLE WRITING b. collected in DIFFERENT WRITING. 3. Can be: a. encompassed in several instruments (all not signed but made part of the signed instrument) 4. Can be: a. a written agreement of which there are two copies, one signed by each of the parties is binding on both to the same extent as though there had been only one copy of the agreement and both had signed.

WHEN CONTRACT CONSIDERED IN WRITTEN FORM In general: to be considered as WRITTEN CONTRACT, its terms must be in WRITING. ==ORAL CONTRACT can be partly in writing and partly oral.

CHAPTER 3 FORM OF CONTRACTS ART. 1356. Contracts shall be obligatory, in whatever form they may have been entered into, provided all the essential requisites for their validity are present. However, when the law requires that a contract be in

TWO ASPECTS OF CONTRACTS ==Article 1318, unless the requisites of consent, object, and cause concur there is NO CONTRACT. ==the concurrence of these elements in the minds of the parties without expression, will NOT PRODUCE A CONTRACT.

Two aspects of contracts: 1. Intent or will — This is internal and as long as a contract exists merely as a psychological fact, it produces no legal effect, because the law cannot take cognizance of its existence; and 2. Expression of such intent or will --It is necessary, in order that the will may produce legal effect, that it be expressed. This expression or declaration of the will is its form. On this basis, contracts are divided into formal and informal. CLASSIFICATION OF CONTRACTS ACCORDING TO FORM 1. Informal or common contract or that which may be entered into in whatever form, provided, all the essential requisites for their validity are present. (Art. 1356.) This refers only to consensual contracts (Art. 1356.), such as the contract of sale. An informal contract may be oral or written; and 2. Formal or solemn contract or that which is required by law for its efficacy to be in a certain specified form. RULES REGARDING FORM OF CONTRACTS

(c) when the law requires that a contract be in some form for the convenience of the parties or for the purpose of affecting third persons. (Art. 1356.) No particular form of evidence is required to prove the existence of an employer-employee relationship. Hence, the absence of a copy of the contract of employment will not in any manner negate the existence of the contract. FORM FOR VALIDITY OF CONTRACT (1) Donation of real property — It must be in a public instrument. (Art. 749.) (2) Donation of personal property the value of which exceeds P5k — The donation and acceptance must be in writing. (Art. 748.) (3) Sale of land through an agent. — The authority of the agent must be in writing; otherwise, the sale is void. (Art. 1874.) (4) Contract of antichresis. — The amount of the principal and of the interest must be specified in writing. (Art. 2134.)

A. General Rule: — Contracts are binding and, therefore, enforceable reciprocally by the contracting parties, whatever may be the form in which the contract has been entered into provided all the three essential requisites (consent, object, and cause), for their validity are present.

(5) Stipulation to pay interest.

B. Exceptions

(6) Contract of partnership.

==The form, however, is required in the following cases: (a) when the law requires that a contract be in some form to be valid;

— It must be in writing; otherwise, no interest is due. (Art. 1956.)

— If immovables are contributed, it must be in a public instrument to which shall be attached a signed inventory of the immovable property contributed. (Arts. 1771, 1773.) (7) Transfer or sale of large cattle.

(b) when the law requires that a contract be in some form to be enforceable or proved in a certain way; or

— It must be registered (so it must be in a public instrument) and a certificate of transfer secured. (Act No. 1147, Sec. 22.) (8) Negotiable instruments.

— They must be in writing. (Act No. 2031, Sec. 1.)

FORM FOR ENFORCEABILITY OF CONTRACT a. In WRITING –valid In the cases of contracts covered by the Statute of Frauds, the law requires that they be in writing subscribed by the party charged or by his agent. b. Not in WRITING—still valid If the contract is not in writing, the contract is valid (assuming all the essential elements are present) but, upon the objection of a party, it cannot be proved and, therefore, it cannot be enforced unless it is ratified.

ART. 1357. If the law requires a document or other special form, as in the acts and contracts enumerated in the following article, the contracting parties may compel each other to observe that form, once the contract has been perfected. This right may be exercised simultaneously with the action upon the contract. (1279a) FORM FOR THE CONVENIENCE OF THE PARTIES ==In certain cases, a certain form (e.g., public instrument) is required for the convenience of the parties in order that the contract may be registered in the proper registry to make effective, as against third persons, the right acquired under such contract. ==Non-compliance with the required form would not adversely affect the validity nor enforceability of the contract between the parties themselves. == As between the pa...