Course Code: BAM 026

Module #2

Name: Class number:

Section: Schedule: Date:

Lesson Title: NATURE AND EFFECT OF OBLIGATION Part 1 Materials:

Lesson Objectives: Student Activity Sheet
At the end of this module, I can:
1. State the rights and duties of the debtor and creditor References:
2. Identify the remedies available to creditor in case of non- Law on Obligations and
performance of obligation by the debtor. Contract by Atty. Andrix D.
3. Differentiate accessions and accessories and identify the Domingo,CPA,MBA
different kinds of things and fruits

Productivity Tip:
It is possible that you are holding your module but your brain is thinking about something else.
Distractions can be internal too. It will help if you work on your modules the same time every
day and remember to do the timer technique which I told you in our previous module. Prepare
yourself everyday as if you are going to school. That way, it will send signal to your brain that
it is time for school work. Do this in the next 3 weeks straight and you will see that working on
with your modules is but a natural thing to do! Happy learning!

A. LESSON PREVIEW/REVIEW

1) Introduction (2 mins)

You have learned from our previous module the four essential
requisites of an obligation. Is object or prestation one of them?

Very good! You’ve got this one correct! ORDERED

While waiting for the delivery of the object or prestation and the same is in the
possession of the debtor, do you think the debtor has the obligation to take care
of the thing? Logic dictates that the answer must be a resounding yes!

Of course, he must take care of the thing while the same is in his possession.
The creditor will not be happy to receive a thing far looking from the thing he
bought just because of the debtor’s failure to observe the diligence required in DELIVERED
taking care of the thing!

I bet that the creditor will be furious when he finally sees the car which he bought looking more like a junk than
a car. What do you think can the creditor do about this problem? Are there remedies available to him?

In this module, you will learn all of these and more! Let’s do this!

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2) Activity 1: What I Know Chart, part 1 (3 mins)

You know the rules when it comes to this activity. There is no right and wrong answer. Go and try
answering the questions below by writing your ideas under the first column What I Know.

What I Know Questions: What I Learned

He first needs to observe if the 1. Prior to the delivery and while Taking care of the thing with proper
debtor is a person that you can trust the thing is in his possession, diligence until its delivered
and has good ratings in the online what is the diligence the debtor
market, and of course, you need to needs to observe?
know if the product is in good
condition by asking for actual
photos.

Determinate or specific thing 2. Identify and define the different Determinate or specific thing
And indeterminate or generic thing kinds of thing. And indeterminate or generic thing

Natural 3. Identify and define the different Natural- grows without human labor
Industrial kinds of fruits. Industrial – grows with human labor
Civil Civil- rents and leases of lands.

B. MAIN LESSON

Activity 2: Pre-Printed Content Notes (13 mins)

KINDS OF THINGS:
Before anything else, it is important for you to learn that there are two kinds of thing.
First, determinate or specific thing which is particularly designated or physical segregated others of the same
class. Example: Toyota Fortuner with Plate No. CAA2275, the ring I am wearing and a cat named “Meowy”.

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Second, indeterminate or generic thing – refers only to a class or genus to which it pertains and cannot be
pointed out with particularity. Example: 2019 Toyota Fortuner, a ring, and a cat.

It is important that you can distinguish determinate and indeterminate thing. Why? Because
the effect differs in case of loss.

Example: A sold to B a cat named “Meowy” but unfortunately because the debtor failed to
observe the diligence required, the cat died while the same is in his possession waiting for the
delivery date. A cannot just replace the cat with another cat. The death of Meowy
MEOWY extinguishes the obligation. He needs to return the payment if there is any and be answerable
for damages.

The story is totally different if A sold to B a cat and the cat died while in the possession of A waiting for
delivery. Even if they agreed with the kind of specie of the cat, it will still be considered an indeterminate or
generic thing. If the cat died, the obligation is not extinguished because A can just get another cat of the same
specie in replacement. The word extinguished can be understood as terminated.

DUTIES OF DEBTOR IN OBLIGATION TO GIVE A DETERMINATE THING:

1. To deliver the thing itself (Art. 1163)
2. To take care of the thing with the proper diligence of a good father of a family unless the law or the
stipulation of the parties requires another standard of care. (Art. 1163)
3. To deliver the fruits of the thing. (Art. 1164)
4. To deliver the accessions and accessories, though may not have been mentioned in the agreement (Art. 1166)
5. To answer for damages in case of fraud, negligence, delay in the performance or contravention of the tenor
(breach of contract) (Art. 1170)

DUTIES OF DEBTOR IN OBLIGATION TO GIVE AN INDETERMINATE THING:

1. To deliver the thing which is of the quality intended by the parties (Art. 1246)
2. To answer for damages in case of fraud, negligence, delay in the performance or contravention of the tenor
(breach of contract) (Art. 1170)

One of the duties of the debtor is to deliver the fruits of the thing. Let us discuss the different kinds of fruits,
shall we?

KINDS OF FRUITS:
1. Natural Fruits – it is the spontaneous products of the soil and the young and other animal products. To be
considered as natural fruit, all trees or plants on lands must be without any human labor involved.
2. Industrial Fruits – are those produced by lands of any kind through cultivation or labor.
3. Civil Fruits – are those derived by virtue of a juridical relation. Example is the rents or leases of lands,
buildings and other properties.

RIGHT OF THE CREDITOR TO THE FRUIT:

Article 1164. The creditor has a right to the fruits of the thing from the time the obligation to deliver it arises.
However, he shall acquire no real right over it until the same has been delivered to him.
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This article is a little bit confusing at first. But the confusion will start to fade away once you understand the
difference between personal right and real right.

Personal right is the right of a creditor to demand from a specific debtor, as a definite
passive subject, the fulfillment of the obligation to give, to do or not to do. In other words, a
personal right is binding or enforceable only against a particular person.

Real right is the right or interest of a person over a specific thing

without a definite passive subject. In other words, a real right is
directed and binding against the whole world.

Going back to Article 1164, it stated that the creditor has a right to the
fruits of the thing from the time the obligation to deliver the thing
EN DELIVERY DATE COMES BUT STILL WAITING FOR DELIVERY
arises. In other words, when the delivery day comes, the creditor has
the “personal right” against the debtor to demand for the delivery of
the fruits.
“REAL RIGHT”
ACQUIRED FROM THE
The second sentence stated that “However, he shall acquire no TIME DELIVERY OF
real right over it until the same has been delivered to him.”, meaning, he shall only FRUITS IS MADE
have “real right” from the time the fruit has been delivered to him.

You might want to ask, when is ownership acquired then?

Nice question! Ownership and other real rights over property are acquired and transmitted in consequence of
certain contracts by tradition. (Art. 712) Tradition is actually a Spanish term for delivery.

REMEDIES OF CREDITOR IN CASE OF NON-PERFORMANCE OF REAL OBLIGATION:

1. Specific Real Obligation (obligation to deliver a determinate thing):
a. He can demand specific performance or fulfillment of the obligation with right to damages.
b. He can demand rescission or cancellation of the obligation with the right to recover damages.
c. He can demand payment of damages only where it is the only feasible remedy.
2. Generic Real Obligation (obligation to deliver a generic thing):
a. He may ask the debtor for the performance of obligation or be performed by a third person since the
object is expressed only according to its family or genus with right to recover damages in case of
breach.

REMEDIES OF CREDITOR IN POSITIVE PERSONAL OBLIGATION:

To have the obligation performed by himself or by another, unless personal
considerations are involved, at the debtor’s expense and to recover damages.

A positive personal obligation means that the debtor has the obligation to do something
for the creditor. Take note, the creditor cannot compel the debtor to fulfill a positive
personal obligation against his will. Why? It is because it may amount to involuntary
servitude which is prohibited by law.
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REMEDIES OF CREDITOR IN NEGATIVE PERSONAL OBLIGATION:

A negative personal obligation means that the debtor has the duty to abstain from doing
an act.

Art. 1168. When the obligation consists in not doing, and the obligor does what has been
forbidden him, it shall also be undone at his expense.

ACCESSIONS AND ACCESSORIES:

Accessions are the fruits of a thing or additions to or improvements upon a thing.

Examples:
Trees on a land, air-conditioner in a car

Accessories are thing joined to or included with the principal thing for the latter’s embellishment, better use or
completion.

Examples:
Frame of a picture, bow of a violin

1) Activity 3: Skill-building Activities (with answer key) (18 mins + 2 mins checking)

Exercise I

1. Give at least 5 examples of specific or determinate thing.

a Car, a Dog, A House, A building, A Farm

2. Give at least 5 examples of indeterminate or generic thing.

A Corvette C6, My house, My Dog Fluffy, Severino Building Capinpin st., My Grandfather’s Farm at Cavinti.

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3. Give at least 3 examples of natural fruits, industrial fruits and civil fruits.

trees and plants that grow naturally without human intervention or human labor (Natural Fruits). Rice, Plants, Vegetables
that involves human labor (Industrial Fruits). Rents and leases of lands like hotels, private resorts etc. (Civil fruits).

2) Activity 4: What I Know Chart, part 2 (2 mins)

It’s time to answer the questions in the What I know chart in Activity 1. Log in your answers in the table.

3) Activity 5: Check for Understanding (5 mins)

Exercise I. TRUE or FALSE

TRUE 1. Every person obliged to give something is also obliged to take care of it with the proper
diligence of a good father of a family, unless the law or the stipulation of the parties requires another
standard of care.

TRUE 2. The creditor has a right to the fruits of the thing from the time the obligation to deliver it
arises.

TRUE 3. The creditor shall acquire no real right over the fruits of the thing until the same has
been delivered to him.

TRUE 4. When what is to be delivered is a determinate thing, the creditor may compel the debtor
to make the delivery.

TRUE 5. If the thing is indeterminate or generic, the creditor may ask that the obligation be
complied with at the expense of the debtor.

A.LESSON WRAP-UP

Activity 6: Thinking about Learning

Congratulations for finishing this module! Shade the number of the module that you finished

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Did you have challenges learning the concepts in this module? If none, which parts of the module helped you
learn the concepts?
I have challenges because some part of the lesson is unclear to me

Some question/s I want to ask my teacher about this module is/are:

none.

Learning Scores Action Plan

Date
Target/Topic

What module# did you What contributed to the quality of your

What were your
What’s the do? What were the performance today? What will you do next
scores in the
date today? learning targets? session to maintain your performance or
activities?
What activities did you improve it?
do?
1/6/2022 Module 2, my learning target I am motivated to do my tasks and I will maintain it
is to learn more about this by being consistent.
subject

FAQs

If the debtor delays or has promised to deliver the same thing to two or more persons who do not have
the same interest, he shall be responsible for fortuitous event until he has effected the delivery.
A fortuitous event is an event independent of the will of the debtor.
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Example: Earthquake, flood, rain, lightning, volcanic eruption, arm conflict, typhoon, shipwreck, etc.

The obligation to give a determinate thing includes that of delivering all its accessions and accessories,
EVEN THOUGH they may not have been mentioned.
If a person obliged to do something fails to do it, the same shall be executed at his cost.

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