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Obligations 2: Rights & Obligations of the Debtor & Creditor (Nature & Effect of Obligations)

Atty. Javier Philippine Law Lectures for Students13:11

Transcription

Hi guys and welcome to another episode of Attorneys of Blogger Law for the Everyday Laymen. Today, we continue with Part 2 on the Law of Obligations, and we talked about the nature and effect of obligations. So, if you like my videos and you want to see more, please hit the subscribe button to be notified if I when you upload.

Ok, please remember that this is only for educational purposes and it's not a substitute for proper legal advice or for studying and understanding the law. Ok, shout out to Frances Plancha and JC Elia of La Salle Green Hills Batch 2002. Thank you, JC Elia, for making the thumbnails of my videos. Ok, so now we can begin.

First, let's just review a few basic concepts. Ok, we have on the one hand a personal obligation and on the other a real obligation. This was discussed in my previous video on the general principles. But a personal obligation is one which either requires the performance of an act, in which case it refers to the presentation to do, or may involve the forbidding of an act to be done, in which case it is an obligation not to do. Ok, whereas a real obligation involves the delivery of the thing, which in which case is a procession to give. Ok.

Now, this should not be confused with personal right and a real right. Ok, a personal right is one which will be enforced against a definite passive subject, namely the debtor. Ok, a real right may be enforced even without an indefinite passive subject, but against the whole world. Ok, so even third persons.

Finally, we have a difference between a determinate or specific thing versus an indeterminate or generic thing. A thing is said to be determinant when it is particularly designated or physically segregated from all others of the same class. Ok, you can point out to a particular one. Whereas an indeterminate or generic thing merely refers to the class or genus to which nothing belongs. You cannot point out a certain thing with particularity or definiteness. Ok, for instance, there are a lot of models of white Westinghouse refrigerators, and that refers to the class of white Westinghouse refrigerators. In order to render it determinate, you must refer to it as a white Westinghouse refrigerator with model number XYZ and motor number WERT12345. Ok, so in that case, you will know that you are referring specifically to that unit, and in which case it is a determinate thing. Ok.

So now we can go to the obligations of the debtor in case the obligation of the debtor requires the delivery of a determinate thing. Ok, now we're talking about determinate things. The first obligation of the debtor, of course, is to deliver the thing itself. Ok, this is specific performance. Second, the debtor must preserve or take care of the thing with that required degree of diligence. Ok, if the party stipulated upon a certain degree of diligence, then that must be observed. Otherwise, if the law requires a certain degree of diligence, that will be followed. In the absence of the stipulation or no flaw, then the default will govern, which is ordinary diligence or the diligence of a good father of a family. Ok, third obligation of the debtor is to deliver all accessions and accessories. What's the difference between accessions and accessories? Accessions are everything that is produced either naturally or artificially and they are attached to the thing. Ok, these can refer to natural fruits, such as the apple of the tree. Ok, accessories on the other hand are those which are merely for the embellishment, use, or preservation of the thing. To make it easy, an earring is an accessory. It's not part of your body, but you can accessorize by wearing an earring. Ok.

Ok, so now the final obligation of the debtor in case of a determinate thing is his liability for damages in case he breaches the obligation due to delay, fraud, negligence, or contravention of the tenor of the obligation. I'll be discussing those later on. Ok.

Next, what if the obligation of the debtor is to deliver a generic thing? Ok, the obligation of the debtor in this case is to deliver a thing of the quality intended by the parties. In other words, the creditor cannot demand a superior thing, and the debtor cannot deliver an inferior thing. Ok, the thing that must be delivered, again, must be of the quality intended, taking into account the purpose of the obligation, the intent of the parties, and other surrounding circumstances. And the second obligation of the debtor is to be liable for damages in case of breach due to delay, fraud, negligence, or contravention of tenor of the obligation. Ok.

Now we can move on to the rights or remedies of the creditor in case of a real obligation, meaning an obligation to give, in case the thing is determinate. Ok, the creditor has the right to compel the the debtor to make delivery or specific performance. Ok, plus damages in case of breach. No. Second, the creditor has the right to hold the debtor liable in case nothing is lost or damaged due to fortuitous event in case there is delay, or if the debtor has promised to deliver the thing to two or more persons who do not have the same interests. Ok, why? Because the law punishes the debtor for his evident bad faith. Why will he promise to deliver to two persons? Only one can own it. No, provided the two persons do not have the same interest over the thing. Ok.

Now, whether it be a determinate thing or a generic thing, please remember that the creditor acquires a personal right to the fruits of the thing from the time the delivery of the thing arises. Ok, he will have the creditor will only acquire a real right. Ok, real right only after the thing has been delivered to him. So what does this mean? Delivery is the mode by which ownership is transferred from the debtor to the creditor, and ownership creates a real right, which will be enforced against the whole world. In other words, by virtue of delivery, the creditor can now tell anyone, no, any third person, hey, I am the owner, and I can enforce my rights. However, what about the fruits? No, if the thing itself has not yet been delivered, that creditor only has a personal right, meaning it can only be enforced against a definite passive subject, who is the debtor. Ok, in other words, the personal right of the creditor is to compel the debtor to deliver the fruits and the thing to him. Ok, in other words, since ownership has not yet been transferred to the creditor, he cannot enforce his right to the fruits against the whole world. Again, because he doesn't have ownership over the thing or the fruits yet. As debtor, therefore, he cannot enforce it against the whole world. Ok.

So how do we know what is the time of delivery? Because time of delivery is the reckoning point why we we know that the personal right to the fruits arises. Right? The time of delivery is said either by law, if the law gives a certain date for delivery, by perfection, if the parties had not agreed otherwise, if the obligation is subject to a condition, then upon the happening of the condition, or if the obligation is set to a period, then upon expiration or arrival of the period. Ok.

So again, the creditor has a personal right to the fruits only as of the time the delivery of the thing arises, and he acquires a real right only after the thing has been delivered to him. Ok.

Now we can go to the rights of a creditor in case of a personal obligation, meaning either an obligation to do or an obligation not to do. Ok, first, let's talk about the positive personal obligation, meaning an obligation to do. If the debtor fails to perform the obligation, or the debtor does the obligation in contravention of the tenor of the obligation, then the creditor may demand that the obligation be performed at the expense of the debtor. Ok, can he can the creditor compel the debtor to actually perform the obligation to do? No, why? Because this will go against the constitutional prohibition against involuntary servitude. In other words, you cannot compel a person to perform an act. So what is your remedy? Your remedy is to to ask that the obligation be performed by some other third person who is willing to do it, but it will be paid for at the expense of the debtor. Ok.

Ok, now this case is accepted that the scenario where the principal motive for entering the public and entering into the obligation is the personal qualifications of the debtor. So let's say the creditor asked the debtor to make a painting because this debtor is a skilled painter who can only make that kind of paintings, like let's say Picasso. Ok, now in that case, since we cannot compel a third person to make an artwork that is Picasso level, then the only remedy of the creditor in that case is an action for damages. Because again, first, you cannot compel the debtor to perform an act against his will because of the prohibition against involuntary servitude, and you cannot compel a third person because the personal qualifications only pertain to the debtor, no one else can do what the debtor is doing. Ok, so your remedy in case of the creditor is damages. On video.

Second scenario under positive obligations or obligations to do, if the obligation has been poorly done, then it may be ordered to be undone at the expense of the debtor. Ok, and in you know, in other cases when these are not available, then simply the creditor has the right to damages. Ok.

Now, what about the scenario of negative personal obligations or obligations not to do? Ok, in other words, the debtor performs an act which has been forbidden. Do not do this. No, then simply the act will be undone, plus the creditor has a right to claim damages. Ok, these rules will not apply, of course, if the effects of the forbidden are definite and cannot be undone. So the remedy of the creditor in this case is to simply ask for damages. Another scenario when this system, the rule is not available, is when it is physically or legally impossible to undo the acts which have been performed. Again, the remedy of the creditor in this case is one for damages.