9.1. OBLIGATIONS: CONCEPTS

The term "obligation" is derived from the Latin word "obligatio", which means "tying or binding".

"ART. 1156: An obligation is a juridica necessity to give, to do or not to do."

9.1.1. PARTS OF AN OBLIGATION

The four parts are:

1. A passive subject (aka: debtor or obligor) - the person who is obliged. He is the one with the duty.
2. An active subject (aka: creditor or obligee) - the person where the obligation is to be done. He is the one with the right.
3. Object or prestation - the subject matter of the obligation.
4. Juridical or legal tie (aka: efficient cause) - the binding instrument, example, a written contract.

9.1.2. FORMS OF OBLIGATION

1. Verbal
2. Written
3. Partly oral and written

9.1.3. KINDS OF OBLIGATION ACCORDING TO THE SUBJECT MATTER

1. Real obligation (obligation to give) - the subject matter is a thing which the obligor must deliver to the obligee.
2. Personal obligation (obligation to do or not to do) - the subject matter is an act to be done or not.
1. Positive personal obligation - an obligation to do
2. Negative personal obligation - an obligation not to do (includes obligation no to give)

9.1.3. SOURCES OF OBLIGATIONS (Art 1157)

1. Law
2. Contracts
3. Quasi-contracts - lawful, voluntary and unilateral acts which are enforceable (Example: obligation to return money paid by mistake).
4. Crimes, acts, or omissions punished by law - acts arising from civil liability, which is the consequence of a criminal offense. (Example: the duty of a killer to indemnify the heirs of his victim).
5. Quasi-delicts or torts - acts arising from damage caused through an actor omission (Example: the obligation of the head of the family to be responsible for the damages caused by throwing or falling things from the house).

9.1.4. LEGAL OBLIGATIONS

"ART. 1158: Obligations derived from law are not presumed. Only those expressly determined in this Code or in special laws are demandable, and shall be regulated by the precepts of the law which establishes them; and as to what has not been foreseen."

Legal obligations are those arising from law, which is not presumed. As long as they are not expressed in the Civil Code, there are no obligations expected.   

Examples of laws which are not demandable (because they are not written in the Civil Code):

1. Employers have no obligation to furnish free legal assistance to employees.
2. A private school has no obligation to provide clothing allowance to its teachers.

Besides the Civil Code, there are other laws, which Article 1158 consider as special laws. They are:

• Corporation Code
• Negotiable Instruments Law
• Insurance Code
• National Internal Revenue Code
• Revised Penal Code
• Labor Code

9.1.5. CONTRACTUAL OBLIGATIONS

"ART. 1159: Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith."

 These are obligations arising from contracts of voluntary agreements.

A contract is the understanding and meeting of minds of two parties whereby one binds himself to the other. A contract is valid when it is not contrary to the law, morals, good customs, public order and public policy.

A breach of contract happens when a party violated a part or the whole contract. A breach takes place when one refuses or fails to comply without legal reason.

9.1.5.1. QUASI-CONTRACTUAL OBLIGATIONS

"ART. 1160: Obligations derived from quasi-contracts shall be subject to the provisions of Law."

A quasi-contract is the juridical relation resulting from lawful, voluntary, and unilateral acts where the parties are bound to each other. In a quasi-contract, there is no consent, unlike contracts where there is meeting of minds and consent.

In other words, the law considers the parties as having entered into a contract although they have not actually done so.

9.1.5.2. KINDS OF QUASI-CONTRACTS

1. Negotiorum Gestio - the voluntary management of the property or affairs of another without the consent or knowledge of the latter. (Example: The obligation of a neighbor to help turn off the fire of a house, when the family is out for a vacation. The family has the obligation to reimburse the expense of the neighbor.)
2. Solutio Indebiti - a juridical relation when something is received by mistake. (Example: A mistakenly pays B a debt he owes to C. B is obliged to return the money.)

9.1.6. CIVIL LIABILITY

"ART. 1161: Civil obligations arising from criminal offenses shall be governed by the penal laws, subject to the provisions of Art 2177, and of pertinent provisions."

1. The article states that every person criminally liable for an act or omission is also civilly liable for damages.
2. There is no civil liability enforced for crimes but a person not criminally responsible may be liable civilly. 

9.1.6.1. SCOPE OF CIVIL LIABILITY

According to the Revised Penal Code, civil liability includes:

1. Restitution -recompense for injury or loss.
2. Reparation for the damage caused - making amends by paying damages
3. Indemnification for consequential damages - payment of damages as a consequence of the crime

9.1.7. QUASI-DELICTS

"ART. 1162: Obligations derived from quasi-delicts shall be governed by the provisions contracts and by special laws."

A quasi-delict is an act or omission by a person, which causes damage to another giving rise to an obligation to pay for the damage done.

9.1.7.1. REQUISITES OF QUASI-DELICTS

1. There must be an act or omission
2. There must be fault or negligence
3. There must be damage caused
4. There must be a direct relation or connection of cause and effect between the omission and the damage
5. There is no pre-existing contractual relation between the parties