Art 1239 Obligations to give, payment by one who does not have free disposal of the thing due

and
capacity to alienate shall not be valid

Effect if incapacity – if debtor has no capacity to pay, creditor cannot be compelled to make the
payment

1240 – Payment must be made to

person whose favor the obligation is constituted

The successor in interest

Authorized person

Authorized person – may legal or conventional

Legal – conferred by law such as authority of a guardian or an incapacitated creditor or administrator or

estate

Conventional – authority given by the creditor himself

Payment to wrong party – payment made by debtor to the wrong party does not extinguish obligation

As to the creditor, if there is no fault or negligence on his part

If the debtor acted in good faith and made mistake through the identity of creditor or fraud of third
party, the payment to the non-authorized is void xpn: art 1241

Deposit in bank: depositing the debt by the debtor into bank account of creditor w/out authorization is
not valid but may prevent debtor from being in default

Deposit in court – GR: cosignation in court when properlymade extinguishes obligation

XPN: Creditor institutes an action for collection of payment with interest but debtor deposits it in court,
but in a different case which is separate and distinct in nature in which payment is demanded, such
deposit is not valid

1241 payment to a person incapacitated to administer property is valid provided he kept the thing or
has been beneficial to him
Payment to a third person valid so long as it has benefited creditor

Benefit be proven via:

1. after payment, third person acquires creditors rights

2. creditor ratifies the payment to third person

3. debtor has been led to believe third person had authority to receive payment

Payment to incapacitated – if creditor is incapacitated, payment must be made to representative. If

none – to the court through consignation

If payment made to incapacitated, valid only insofar as creditor has benefitted.

In creditor DID NOT benefit, debtor has to pay again when creditor has capacity

Benefit to creditor – subject of controversy

Roman doctrine states that payment used in improvements which have ceased to exist at time of
complaint,

Dmolembe, if he made an intelligent and reasobale use that is useful to him which his legal
representatives would have done the same.

Or if used for tational purposes

Payment to third person – payment to incapicated applies to third person

Payment done to third person not authorized does not relieve him from obligation unless benefit
accrued to creditor

Fault of creditor – even if creditor received no benefit, creditor cannot demand payment if debtor
makes mistake by the fault of the creditor

1242 – payment made in good faith to any person in possession of credit will release debtor

This is the exception to payment made to creditor or authorized representative

Possession of credit – neither creditor or authorized representative

He appears to be the owner of credit but may not the owner

Ex. Heir of heridarty estate and collects the credits but is later deprived due to incapacity

Signee of credit but later assignment is annulled or rescinded

Holder of instrument payable to bearer but merely found it

1243 payment to the creditor by the debtor after the debtor has been jurdically ordered to retain the
debt is not valid

Garnishment – payment to creditor after credit has been attached or garnished is void

The debtor is ordered to pay again but may recover to the same extent what he has paid to his creditor

Cosignation – debtor upon who a garnishment order is served can deposit the money in court via
consignation

If action fails – if the action of the attachment or garnishment fails, then garnishment has no effect.

1244 debtor of a thing cannot compel creditor to receive a different one unless it is of the same value or
more valuable.

Substitution of prestationji – debtor cannot compel credito to receive a different thing unless it is of the
same value unless theire is agreement or consent of creditor

Waiver of defect – the defect of the thing delivered may be waived by creditor if he declares so or if he
accepts without protest

1245 Dation in payment – where property in exchange for debt will be governed by law on sales

Concept of dation of payment – delivery and transmission of ownership of a thing by debtor as an

equivalent of the performance of obli

May not only be a thing but can also be a real right (Usufruct) or credit against a third person.

Effect on obli – dation in payment extinguishes obligation to the extent of value of thing delivered

Distinguished from Assignment – Assignment of property

Warranties of Debtro

Error in Pament

1246 – if delivery is generic thing with no regards to quality, creditor cannot demand a thing of superior
quality and debtor cannot give inferior quality

Courts will decide on the quality depending on the purpose and nature of obli

1247 unless stipulated, extradjudicial expenses shall be for the account of the debtor

1248 unless stipulated, creditor cannot be compelled partially to receivethe prestations which the
obligations consists

Debtor cannot be required to make partial payment

However if debt is part liquidated and part unliquidated, creditor may demand payment without waiting
for liquidation

Partial prestation- creditor cannot be compelled to accept partial performance

Creditor who does not accept partial performance does not incur delay xpn: when there is abuse of right

Plurality of subject: article does not apply when there are several subjects or where they are parties
bound to different terms
Thus in a joint obi: debtor may only offer to pay his share of the obli and creditor cannot accept partial
obli

In solidary where debtors are bound by different terms and conditions, debtor may only pay his part

Partly liquidated – person bound to 1000 in a countract which provides for damages

The principal debt can be demanded and paid even before the determination of damages as to which
the obli is unliquidated

1249 – payment odebbt in money payable to currency stipulated if not, legal tender in the Philippines

Delivery of PN, BOE or other mercantile documents have the effect of payment when cashed

Legal tender: currency in a given jurisdiction which can be used for payment of debts and accnot be
refused by creditor

Ex: Philippine silve person half peso

Philippine treasury certificate

Notes and coins issued by the Central Bank

During Jap Occupation

Payments made during that period is valid

Places where there was no jap control under control during the commonwealth via emergency notes is
valid

However such notes have lost value after nov 18 1944

Loss of value – those who accepted Japanese notes and held them even after occupation sufferd the
consequences.

So long as the notes were accepted, the person who held them after must suffer the consequences

If money was dpeostited in a bank or with another person, the deposit must be considered with a
specification of a currency.

Currency in payent -