1991 Nature of Contracts; Obligatoriness

Roland, a basketball star, was under contract for one year to play-for-play exclusively for Lady
Love, Inc. However, even before the basketball season could open, he was offered a more
attractive pay plus fringes benefits by Sweet Taste, Inc. Roland accepted the offer and transferred
to Sweet Taste. Lady Love sues Roland and Sweet Taste for breach of contract. Defendants
claim that the restriction to play for Lady Love alone is void, hence unenforceable, as it
constitutes undue interference with the right of Roland to enter into contracts and the impairment
of his freedom to play and enjoy basketball.

Can Roland be bound by the contract he entered into with Lady Love or can he disregards the
same? Is he liable at all? How about Sweet Taste? Is it liable to Lady Love?

Yes, Roland is bound by the contract he entered into with Lady Love and he cannot disregard the
same, under the principles of obligatoriness of contracts. Obligations arising from contracts have
the force of law between the parties.

1991Period; Suspensive Period

In a deed of sale of a realty, it was stipulated that the buyer would construct a commercial
building on the lot while the seller would construct a private passageway bordering the lot. The
building was eventually finished but the seller failed to complete the passageway as some of the
squatters, who were already known to be there at the time they entered into the contract, refused
to vacate the premises. In fact, prior to its execution, the seller filed ejectment cases against the
squatters.

The buyer now sues the seller for specific performance with damages. The defense is that the
obligation to construct the passageway should be with a period which, incidentally, had not been
fixed by them, hence the need for fixing a judicial period. Will the action for specific
performance of the buyer against he seller prosper?

No. The action for specific performance filed by the buyer is premature under Article 1197 of the
Civil Code. If a period has not been fixed although contemplated by the parties, the parties
themselves should fix the period, failing to do so, the court maybe asked to fix it taking into
consideration the probable contemplation of the parties. Before the period is fixed, an action for
specific performance is premature.