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CONTRACTS

1347-1349

Maria Khristianie I Rubias


CIVIL CODE OF THE PHILIPPINES
• Object of Contract
Purpose is to create or end the obligations,
which in turn may involve things or services.

• Future Things as the object of contract.


Object of Contract must be in existence at the time of
perfection, or if not in existence there is possibility or
potentiality of coming into existence at some future
time. They may be made, raised or acquired by the
seller after the contract is perfected
A agreed to sell future harvest of his
sugarcane to a specific parcel of his land to B.
• Future inheritance can be the object of contract in
cases provided by law.

A’s father died, but before the delivery of


property to him, he sold his share of property inherited.
Is the sale valid? Yes. The inheritance here is not
future, but existing inheritance, although as yet
undelivered. Ownership is transferred automatically to
the heir upon the death of the decedent.

If A’s father still alive, and he sold to B his


property expected to receive from his father. Is it valid?
No. because the object of contract here is future
inheritance.
• Art. 1348. Impossible things or services cannot be the
object of contracts. (1272)
 Impossibility may be:
Nature of transaction/law
Example: Illegal gambling, Illegal Trade
Absolute (objectively Impossible-No one can do it)
Example: Vacation to Planet Mercury.
Relative (subjectively impossible-Debtor cannot comply)
Example: A (blind man) enters into a contract
which requires he use of his eyesight., the contact is void.
Art. 1349. The object of every contract must be determinate as
to its kind. The fact that the quantity is not determinate shall not
be an obstacle to the existence of the contract, provided it is
possible to determine the same, without the need of a new
contract between the parties. (1273)

a. Object must be determinate or determinable (without need of


new agreement)
Example: A sold to B the future harvest in A’s field in definite
price, contract is valid, without need of new agreement.

b. If object is not determinate, contract is void


Example: A promise to sold something to B, it is clear that
there can be no obligation here.
CONTRACTS
(Article 1350-1355)

KRIS ZALDIVAR
CAUSE DEFINED
IT IS THE ESSENTIAL AND IMPELLING
REASON WHY A PARTY ASSUMES AN
OBLIGATION. STRICTLY SPEAKING, THERE IS
NO CAUSE OF A CONTRACT, BUT THERE IS
A CAUSE FOR AN OBLIGATION.

REQUISITES FOR CAUSE:

1. It must be present
2. It must be true
3. It must be lawful
• Onerous contracts – here the cause is, for each
contracting party, the prestation or promise of a thing or
service by the other. One example is contract of sale.
• Remunatory contracts – the past service or benefit
which by itself is a recoverable debt.
• Gratuitous (or contracts of pure beneficence) – here
the cause is the mere liability of the benefactor. Example
is pure donation.
EXAMPLE:

A is obliged to sing at a concert, in return for


which she will receive a car from B.
Regarding A, the subject matter is the singing; the
cause is the car. Regarding B, the subject matter is the
car; the cause is the singing.
MOTIVE DISTINGUISHED
FROM CAUSE

• The motive of a person may vary although he enters


into the same kind of contract; the cause is always the
same.
• The motive may be unknown to the other; the cause is
always known.
• The presence of motive cannot cure the absence of
cause.
EXAMPLE:

I buy a gun worth 50,000 because I want to kill


myself. The cause of the contract is the gun for me; the
money for the seller. My motive however is the killing of
myself. Motives do not enter at all in the validity or
invalidity of cause or consideration.
DEFECTIVE CAUSES AND
THEIR EFFECTS:

1. Absence of cause and unlawful cause

• In the absence of cause, the contract is VOID. (Note


that the cause must exist at the time of the perfection of
the contract.)
• If the cause is unlawful, the transaction is null and
void.
EFFECT IF THE CAUSE IS
ILLEGAL:

• If one party is innocent he cannot be compelled to


perform his obligation, and he may recover what he has
already given.
• If both parties are guilty, in general, neither can sue
the other, the law leaving them as they are.
2. STATEMENT OF FALSE
CAUSE IN THE CONTRACT

• Just because the cause stated is false does not mean


that the contract is void, but merely revocable or
voidable.
Reason: the parties are given a chance to show that a
cause really exists, and that said cause is true and lawful.
(art. 1355)
3. LESION OR
INADEQUACY OF CAUSE

• Lesion is defined as inadequacy of cause, like an


insufficient price for a thing sold.
• General rule: lesion or inadequacy of price does not
invalidate a contract.
Except: when together with lesion, there has been:
a) Fraud
b) Mistake
c) Or undue influence
• IN CASES EXPRESSLY
PROVIDED BY LAW IN THE
FOLLOWING, THE CONTRACTS
MAY BE RESCINDED:
a) Those which are entered into by guardians whenever
the wards they represent suffer lesion by more than one-
fourth of the value of the things.
b) Those agreed upon in representation of absentees, if
the latter suffer lesion.
c) Partition among co-heirs, when anyone of them
received things with a value less by at least one-fourth
than the share to which he is entitled.
PROBLEM:

a) guardian of A sold A’s mansion worth 120 million for


60 million. May the contract be rescinded on the ground
of lesion?
ANS.: Yes, such case is expressly provided for by the
law as one of the contracts that may be rescinded on
the ground of lesion.
PROBLEM:

b) A sold his mansion worth 120 million to B for only 60


million because A did not know the true value of the
house. May the contract be rescinded?
ANS.: No, as a general rule it does not invalidate a
contract. But if A sold it because of fraud or mistake or
undue influence, the contract may be annulled.
PRESUMPTION OF THE
EXISTENCE AND LAWFULNESS
OF A CAUSE, THOUGH IT IS NOT
STATED IN THE CONTRACT
• It is necessary that the cause must exist, but it is not
necessary to state the cause in the contract. Reason: it is
presumed that the cause exists and is lawful, unless the
debtor proves the contrary.
PROBLEM:

A made a promissory note in favour of B. A,


however alleged that the cause was his gambling losses
in a prohibited game. Who has the burden of proving
that the game was indeed a prohibited one?
ANS.: A because under the law, the presumption is
that the cause is lawful.

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