LN PHINMA EDUCATION MAKING IVES HETERW ROUGH EDUCATION Course Code: BAM 026 Module #6 Name: fimees A= _Eupinaia, Class number Section: ‘Schedule: Date: Lesson Title: DIFFERENT KINDS OF OBLIGATION Part 3 Materials: Joint and Solidary Obligation Part A Student Activity Sheet Lesson Objectives: References: Atthe end of this module, | can Law on Obligations and 1. Define joint and solidary obligation Contract by Atty. Andrix D. 2. Name the words used to indicate joint or solidary liability. Domingo,CPA.MBA 3. State the rules on joint indivisible obligation. 4, Distinguished between indivisibility and solidarity. 5. Understand the effects of payment of joint and solidary obligation. Productivity Tip: 4 No matter what you feel, show up and never give up! Remember that success is only rrondemm | possible for people who never gives up! Happy learning! A. LESSON PREVIEW/IREVIEW 1) Introduction (2 mins) You learned from our previous module that we have at least ten primary kinds of obligation. These are 4. Pure Obligation 2. Conditional Obligation 3. Obligation with a Term or Period : 4. Alternative Obligation 5. Facultative Obligation 6. Joint Obligation 7. Solidary Obligation 8. Divisible Obligation 9. Indivisible Obligation 10. Obligation with a Penal Clause ‘ We are finished discussing the first five kinds of obligation. Can you recall the meaning of the first five kinds of obligation? Very good! | am impressed! In this module, | wil discuss with you the first part of joint obligation and solidary obligation. FuM 1.0 : ‘Scanned with CamScanner| PHINMA EDUCATION Course Code: BAM 026 Module #6 Name: Class number: Section: Schedule: Date: 2) Activity 1: What | Know Chart, part 1 (3 mins) Try answering the questions below by writing your ideas under the first column What | Know. [What [Know Questions: What | Learned 1. Define Joint Obligation. tr & an oltigertion lwhere, the abhigation | is 40 paid or palcille ery oti gor MME only gor g ect OF the Unad rarer tionatel 1 oy debotos Racked te wach demanded ‘proper.c, i Jocigee- 4 iy caste, Proverlonctt ely the. = cea, | % Define Solidary Obligation An obligatio® where the, tots ie bound fo 5 be compelled fo Greditoe Sas HO Fight 45 Pay & 4n€ creates Ctmand she entire | are emtitled 4o comphANCe — with the, wat a prtecimtion - | = 3. Distinguished etween ee ; . maivicibility j¢ the,| indivisiblity and solidarity ine cal Y Poming to the [Me Object rotictavity perining _ He the ‘surictical Re | | obligation whit | ine 5 oye te volidari ty a Wabili Fy does not h necessarily mean teat FES te tne obi gation | ie initible anh Nine Cetween He ony tebter ig fey le, i = 3) B. MAIN LESSON 1) Activity 2: Pre-Printed Content Notes (13 mins) 'n our previous lessons, did you notice that there is only one debtor and one creditor in the given “4 ilustrations? Obligation according to the number of parlies involved may be individual obligation ‘and collective obligation, M10 2 ‘Scanned with CamScanner|_Y PHINMA EDUCATION Course Code: BAM 026 Module #6 Name Class number: oe —_- Section’ ‘Schedule’ Date: e 6 Q {individual obligation is one where there | only one debtor and only a f one creditor. ys Collective obligation is one where there are two or more debtors and/or two or more creditors. It may be joint or solidary. DEBTORS CREDITORS JOINT OBLIGATION: itis an obligation where the whole obligation is to be paid or fulfilled proportionately by the different debtors and/or is to be demanded proportionately by the different creditors. SOLIDARY OBLIGATION: itis an obligation where each one of the debtors is bound to render, and/or each one of the creditors has a right to demand from any of the debtors, entire compliance with the prestation. 7 Solidary obligation is burdensome. Imagine you and your nine other friends solidarily 7, entered into a contract of loan amounting to Php100,000.00. When due date came, the 4 creditor asked you to pay the entire amount, ‘Are you bound to pay the entire amount? The answer is a resounding yes! Why? Because you are a solidary debtor and you are bound to pay the entire amount! SOLIDARY DEBTOR COLLECTIVE OBLIGATION PRESUMED TO BE JOINT: Being so burdensome, the law provides that solidarity is not presumed! If the contract is silent or do not say anything clear and definite about solidarity, then it is presumed to be a joint obligation. There is a solidary liability only when 1. the obligation expressly so states 2. the law requires solidarity 3. the nature of the obligation requires solidarity WORDS USED TO INDICATE LIABILITY: 1. Joint Liability mancomunada Mancomunadamente pro rata proportionately “we promise to pay’ signed by two or more persons. FLM 1.0 ‘Scanned with CamScannerLY PHINMA EDUCATION Sencar nRoUG EDUCATES : course Code: BAM 026 Module #6 Class number: ———— Name Section’ Sciedue aanneeenes oe 2. Solidary Liability jointly and/or severally Solidaria In solidum Together and/or separately Individually and/or collectively Juntos 0 separadamente “1 promised to pay" signed by two or more person RULE ON JOINT INDIVISIBLE OBLIGATION. Analysi - Obligation is joint because the parties are proportionately liable. = Obligation is indivisible because the object or prestation is not physically divisible. - The debtors are joint as to liability and creditors are joint as to their rights. ~The obligation is indivisible as to compliance. Example ; A, B and C are jointly liable to give D a cellphone valued at Php15,000.00. On the delivery date, A and B are willing to deliver, however, C is not. Since the object is indivisible, the obligation can only be enforced by proceeding against all the debtors for compliance. What will be the remedy of D? According to Article 1224, the liability is converted into one for damages. A, B and C will be liable for Php5,000.00 each. But C shall be liable for damages to D INDIVISIBILITY and SOLIDARITY DISTINGUISHED. 1. Indivisibility pertains to the object or prestation while solidarity pertains to the juridical tie. 2. Only the debtor guilty of breach of obligation is liable for damages while in solidarity obligation, all of the debtors are liable for damages in case there is a breach committed by any of the debiors. 3. Solidary liability does not necessarily mean that the obligation is indivisible. EFFECTS OF PAYMENT OF JOINT AND SOLIDARY OBLIGATION: Let us deepen your understanding about joint and solidary obligation by showing you an illustration. Case 1: Joint Debtors & a Creditor A and B are joint debtors of X to the amount of Php50,000.00 - Xan demand from A Php25,000 only. +X can demand from 8 Php25,000 only. Why is that? It is because the debtors are joint and joint debtors are only answerable to their proportionate share in the obligation Fum 1.0 ‘Scanned with CamScannerLy PHINMA EDUCATION Course Code: BAM 026 Module #6 Name: Class number: Section: ‘Schedule! Date Case 2: Joint Debtors & Joint Creditors Aand B are joint debtors of W, X, Y and Z, joint creditors to the amount of Php100,000 a So B - Being a joint creditor, each of them is entitled to collect Php25,000. W250 172.5001 72,600] - _ Being a joint debtor, A and B has a total obligation of Php50,000 _ ' : each X_{ 25,000 | pe 12.500 |" Wean demand payment from A Php12,600 and 8 Php12.500 so he ¥_{ 26,000 | 12, z can collect his Php25,000.00 share. Z | 26,000 | 12,500 { 12,500 | _ XY and Z also has the same right as W. 100,000 | 50,000 | 50,000 | _ Notice that after A give Php12,500 to W.X,Y and Z, his total ‘obligation of Php50,000 will be paid Case 3: Solidary Debtors & a Creditor Aand B are solidary debtors of X to the amount of Php50,000.00 = Xan demand the entire amount from A or B - IfA paid the entire amount, he can ask reimbursement from B to the amount of Php25,000.00 Case 4: Solidary Debtors and Solidary Creditors Aand B are solidary debtors of W,X,Y and Z, solidary creditors the amount of Php100,000.00 - Each of them can compel either A or 8 the entire amount because the obligation is solidary on both sides, ~ If paid the entire amount to W, A can ask reimbursement from B to the amount of Php50,000.00 representing B's share in the obligation. - After receiving the payment from A, Wis obliged to give Php25,000.00 each to X,Y and Z. Case 5: Solidary Debtors and Joint Creditors Aand B are solidary debtors of X,Y and Z, joint creditors, to the amount of Php30,000.00 | KorB | - X,Y and Zare joint creditors. They are only entitled to their proportionate share X [10,000 | 10,000] in the obligation. The total amount of Php30,000 is divided by 3 or Php10,000 each. Y_| 40,000 | 10,000] -, Aand Bare solidary debtors and they are bound to pay the entire amount of the Z [10,000 70,0007) °bligation which is due to each creditor, 30.0001 30-0007] | Short, X can collect his share amounting to Php10,000 from either A or B. : . - YandZ can also collect from either A or B. runs ‘Scanned with CamScannerLy PHINMA EDUCATION Course Code: BAM 026 Module #6 Naame: Class number:_____——— Section ‘Schedule: Date: _ Case 6: Joint Debtors and Solidary Creditors K cand B are joint debtors of X.Y and Z, soldary creditors, to the amount of Php30,000, K J] - Aand B are joint debtors, They are only liable to their proportionate share %_|_10,000 inthe abilty. Therefore, the Php30,000 lability is divided between the 2 o $—\~40'000/| 15,000 | 15,000] them, making them liable to Php15,000 each Zz] 40,000] : -X.¥ and Z are solidary creditors, The are entitled to collect the entire | 30,000 | 75,000 | 78,000} Ch'92ton. = X can compel A the entire amount of A's liability of Php1,000. Look at the chart, X share in the credit is only Php10,000 bui after compelling A to pay, he collected Php16,000, Remember that in this kind of case, even though X can already satisfy his claim from the amount | collected, he must not do so. In fact, X must give Php§,000 to Y and Php5,000 to Z. ‘This may sound a bit impractical, but this is the legal way to do it. He must wait until Y and Z can collect and remit to him his proportionate claim in the loan. 2) Activity 3: Skill-building Activities (with answer key) (18 mins + 2 mins checking) 4. If there are two or more debtors in one and the same obligation, is their liability joint or solidary. Explain gia’ Ceawies any peat teen 0 connestinnl be-tten : +: —kecaute. og — raat tweryene ——tesiolue d — iy rhe ail epee what they could have 2. In case of active solidarity (solidary creditors), to whom shall the debtors or debtors make payment? : tor ond ade —ig —abligad. pal pl sme-tying tt may tee 3. Give your own illustration where there is a. solidary creditors and joint debtors. b. joint creditors and solidary debtors id Aelotoes Lo and oma are vol oh "dary | dooted of Faye, Lea, ben Md fM10 brace + joint —ereditor amount — oF -F5, 000 ovo ‘Scanned with CamScannerLY PHINMA EDUCATION Course Code: BAM 026 Module #6 Name: Class number: Section: ‘Schedule’ Date: 3) Activity 4: What | Know Chart, part 2 (2 mins) It’s time to answer the questions in the What | know chart in Activity 1. Log in your answers in the table. 4) Activity 5: Check for Understanding (5 mins) Ra Exercise |. TRUE or FALSE 4, The concusrence of two or more creditors in one and the same obligation imply that each has the right to demand the entire compliance of the prestation ERLE 2. The concurrent of two or more debtors in one and the same obligation imply that each ‘one of them is bound to render the entire compliance of the prestation. +eUC__3. There is a solidary liability only when the obligation expressly so states. epi _4. There is a solidary liability only when the nature of liability requires solidarity 5. In joint obligation, the credit or debt shall be presumed to be divided into as many equal Shares as there are creditors or debtors. FALSE _ 6. Collective obligation is presumed to be solidary PALS _7. Active solidarity is solidarity of debtors. credi-targ KU[e 8. Passive solidarity is solidarity of creditors. debtors LCE _9. The indivisibilty of an obligation give rise to solidarity Z__10. Solidarity may exist although the creditors and the debtors may not be bound in the same. manner and by the same periods and condition. ~ A.LESSON WRAP-UP. av ¥ PE a z TREE EEE hee ele eee ee Activity 6: Thinking about Learning Congratulations for finishing this module! Shade the number of the module that you finished Fumi 10 ‘Scanned with CamScannerza PHINMA EDUCATION ode: BAM 026 swan ts mr ROUGH " one Module #6 mber:__——— fare ce nu Section: ‘Schedule: ma odule helped you Did you have challenges learning the concepts in this module? If none, which parts of the ™ learn the concepts? “ek - ‘Some question/s | want to ask my teacher about this module is/are: — Ups ~ | Learning Scores | Action Plan ae Target/Topic What module# did you What contributed to the quality of your : What were your 2 2 | What's the | do? What were the | < 00 N° YAN" | performance today? What will you do next date today? | learning targets? What | 2 iting session to maintain your performance or activities did you do? improve it? FM 1.0 ‘Scanned with CamScanner4 PHINMA EDUCATION ‘AKIN UVES BETTER ARG GH EDGEATION Course Code: BAM 026 Module #6 Name: Sectic ———Shegues SCL lass number: lon Schedule: Date: FAQs ® In joint obligation © there are as many debts as there are debtors, © there are as many credits as there are creditors © the debts and credits are considered distinct and separate from one another ‘© each debtor is liable only for a proportionate part of the debt © each creditor is entitled only to proportionate part of the credit Conventional solidarity is where solidarity is agreed upon by the parties. Legal solidarity is where solidarity is imposed by law. The indivisibility of an obligation does not necessarily give rise to solidarity Solidarity does not in itself imply indivisibilty Solidarity may exist although the creditors and the debtors may not be bound in the same manner and by the same periods and conditions. eee FuM 10 ‘Scanned with CamScannerza PHINMA EDUCATION Course Code: BAM 026 Module #7 Name; _ i “ i Class number: Section’ Schedule: Date: Lesson Title: DIFFERENT KINDS OF OBLIGATION Part 4 Joint and Solidary Obligation Part B Lesson Objectives: At the end of this module, | can Debtors 2. Describe the effects of remission of share after payment 3. Name the defenses available to a solidary debtor 1. State the Effects of Acts of Solidary Creditors and Solidary Material Student Activity Sheet References: Law on Obligations and Contract by Atty. Andrix D. Domingo, CPA,MBA Productivity Tip: if you find yourself out of track, do not lose your fighting spirit. Besides, you are not proovery | the only person in this world that loses track from time to time. Be kind enough to es & mm e | yourself by being your own best friend! Tell yourself to never say never! Keep fighting! Happy learning! A. LESSON PREVIEW/REVIEW 1) Introduction (2 mins) Module #6 contains the first part of our discussion about joint and solidary obligation. You learned already the definition of joint and solidary obligation. Can you distinguish between the two? Very good! Joint obligation is an obligation where the debtors are liable and the: creditors are entitled only to their proportionate share while in solidary obligation, the debiors can be compelled to pay and the creditors are entitled to collect the entire amount. | also illustrated cases showing you the consequences of joint and solidary obligation. | am confident that those illustrations will help you deepen your understanding about joint and solidary obligation In this module, which is the second and last part of our discussion about joint and solidary obli gation, | will discuss with you the effects of acts of solidary creditor and solidary debtor, the effect of remission of share (basically, remission is when one of the creditors decided to just forget about the debt of one or all of the debtors) and the defenses available to a solidary debtor. FLM 1.0 ‘Scanned with CamScanner> PHINMA EDUCATION Course Code: BAM 026 Module #7 Name: Class number: Section: Schedule: Date: 2) Activity 1: What | Know Chart, part 1 (3 mins) Try answering the questions below by writing your ideas under the first column What / Know. What | Know ‘Questions: What | Leamed 1. What are acts that solidary ° ee ee creditors are allowed to do? a ace ighte le WER HE HOU ARE Conic : lothenc Suk nck oe . a opting which moy = las breAudi¢al tod 4 le later 2. What is the effect of payment by - Wnak may be the a solidary debtor? Ip eo or more linked and come cred eidary “debhoT fe the yor dical Fe peer te pay the wos chide wea calreatiy * editor masl choose ubich 3. Whatis the effect of remission of | _* * - te an demad share after payment has already [AC remurcion mode ey - fir been given? [ee arediter Oe a ane which Bete to rehurn OF hit Wor dary debtes. do net whore ie ther Release tye Viidan} debe Bop mtact had not 7 From his reaporyibitity been given. MAAC Fhe Code torr. B. MAIN LESSON 1) Activity 2: Pre-Printed Content Notes (13 mins) EFFECTS OF ACTS OF SOLIDARY CREDITOR: Article 1212. Each one of the solidary creditors may do whatever may be useful to the others, but not anything which may be prejudicial to the latter. This article is based on mutual agency. One of the sotidary creditors are allowed to do everything that is useful to other solidary creditors but he cannot do anything which my cause negative effects to other solidary creditors. FLM 1.0 ‘Scanned with CamScannera PHINMA EDUCATION Course Code: BAM 026 Module #7 Name: Class number. Section, Schedule: _ Date: Useful Act - one of the solidary creditors collected the debt. This is a useful act because it will benefit the other creditors. Prejudicial Act - one of the solidary creditors effected the remission of debt. This remission will extinguish the obligation. The remission of one of the solidary creditors prejudiced the other creditors. The remission is valid, however. the solidary creditor who effected the remission will have to reimburse the other solidary creditors for their share. 5. : Article 1213. A solidary creditor cannot assign his rights without the consent of the others . Assignment of Solidary Creditor of His Rights - Any of the solidary creditors can collect the entire amount from the solidary debtor. This is the reason why the solidary creditor must get the consent of the other solidary creditors before: he can validly assign his rights to a third person. But if the assignment is made to another solidany creditor, the consent of the other creditors is not necessary. Acceptance of Payment by a Solidary Creditor - The debtor may pay any one of the solidary creditors; but if any demand, judicial or extrajudicial, has been made by one of them, payment should be made to him. The acceptance of payment representing the entire amount of the obligation by any of the solidary creditor shail extinguish the obligation Effect of Novation, Compensation, Confusion and Remission: 1. Solidary Obligation: Novation, compensation, confusion and remission are all modes of extinguishment of an obligation. | will discuss it with you in details in the coming modules. For now, it is important to know that the above-mentioned acts, is made by any of the solidary creditor or with any of the solidary debtors, shall extinguish the obligation. The solidary creditor who executed any of these acts should be liable to the other solidary creditors for their shares considering that such acts are prejudicial to them, 2. Joint Obligatio The above-mentioned acts do not extinguish the obligation except with respect to the creditor or debtor affected if made where the obligation is joint EFFECTS OF ACTS OF SOLIDARY DEBTOR: Payment by a Solidary Debtor: Article 1217. Payment made by one of the solidary debtors extings debtors offer to pay, the creditor may choose which offer to accept es the obligation. If two or more solidary Fum19 ‘Scanned with CamScannera PHINMA EDUCATION -MAKINGGUNES BETTER TRO GHRDLCATION Course Code: BAM 026 Module #7 Name: Class number:___— Section: ‘Schedule’ Date: i h, W He who made the payment may claim from his co-debtors only the share which corresponds, 2 ea interest for the payment already made, If the payment is made before the debt is due, n intervening period may be demanded. ‘When one of the solidary debtors cannot, because of his insolvency, reimburse his share to the debtor payir the obligation, such share shall be borne by all his co-debtors, in proportion to the debt of each. ® The above article contains the rules and procedures to follow: © Payment is made by one of the debtors * obligation is extinguished he may now ask for his co-deblors reimbursement with interest on proper case if any of his co-debtors cannot reimburse him because of insolvency, the amount shalll be bore by all his co-debtors Payment After Obligation Has Prescribed or Become Illegal: Article 1218. Payment by a solidary debtor shaill not entitle him to reimbursement from his co-debtors if such payment is made after the obligation has prescribed or become illegal . Presciption — By prescription, one acquires ownership and other rights through the lapse of time in the manner and under the condition laid down by law. In the same way, rights and actions are lost by prescription. (Article 1106) There are actions that must be filed within ten years, six year or four years. The concept of prescription is that if the aggrieved party failed to file on time, then he loses his right to file the case anymore. The debtor cannot ask reimbursement from his co-debiors if he paid the obligation which has already prescribed He paid an obligation which in fact they are not bound to pay anymore. This is also the rule when the obligation becomes illegal. Effect of Remission of Share After Payment This is a scenario where the payment was already made by one of the debtors BEFORE the creditor extended a remission of share to one of the solidary debtors. We have leamed that remission or cancellation of debt extinguishes an obligation. But the remission made by the creditor of the share which affects one of the soli i Qf idary debtors does not release the solidary debtor from his responsibility towards the co-debtors, in case the debt had been totally paid by anyone of them before the remission was effected In short, the debtor, whose share in the debt was cancelled by one of the creditors, still has to give reimbursement 'o his co-debtor who paid the entite obligation. He can just demand from the creditor the retum of his share in the payment made by his co-debtor, 4 FLA 1.0 ‘Scanned with CamScannerly PHINMA EDUCATION Course Code: BAM 026 Module #7 Name: Class number: Section’ ‘Schedule Date: DEFENSES AVAILABLE TO A SOLIDARY DEBTOR Article 1222. A solidary debtor may, in actions filed by the creditor, avail himself of all defenses which are derived from the nature of the obligation and of those which are personal to him or pertain to his own share. With respect to those which personally belong to the others, he may avail himself thereof only as regards that part of the debt for which the latter are responsible. If a creditor filed an action or case against a solidary debtor, Article 1222 prescribes the defenses available to him. Sometimes, the solidary debtor may have a valid reasan for not paying the debt ‘There are defenses which are derived from the nature of the.obligation. Example: A and B are solidary debtors of X to the amount of Php5,000. The debt was paid by Win full. In action against A and B by X, they can raise the defense of payment and that the obligation was extinguished. There are defenses which are derived from those which are personal to him or pertain to his own share: X filed a case against A. However, A claimed that she was insane_at the time the obligation was entered into. A can put up the defense of insanity and this is @ defense personal to A. $3 eng 2) Activity 3: Skil-bulding Activites (wth answer key) (18 mins +2 mins checking) guy 4 Exercise | 1. Give the effect of the condonation or remission of a debt by one of several creditors: a. where the obligation is joint b. where the obligation is solidary chin _ pre: te each, with the his (o- debtery the whane, which eorrtpshalg intoter Pr He payment alreoty mate + Fim ‘Scanned with CamScanner> PHINMA EDUCATION psn NES BETTER ROL CA TOLEATION Course Code: BAM 026 Module #7 Name: Class number: Section: ‘Schedule: Date: 2. Ifthe solidary debtor obtained remission of the whole obligation, is he entitled to reimbursement from his co- debtors? Explain 3, in case a remission was extended by a creditor of the share of one of the solidary debtor, is that debtor released from responsibilty to his co-debtors? Explain doec the becauce/ wlnaseiae eee ee to fas orb eee Ot poi ceeditaC do there, Ww nots ng. +t € Yot dary ee tany deohe 3) Activity 4: What | Know Chart, part 2 (2 mins) Ws time to answer the questions in the Whet ! know chart in Activity 1. Log in your answers in the table. Exercise |. TRUE or FALSE & 4) Activity 5: Check for Understanding (5 mins) 1. Each one of the solidary creditors may do whatever may be useful to the others and anything which may be prejudicial to the latter spud 2. A solidary creditor can assign his rights to a third party without the consent of the others. 3. Thé creditor may proceed against any one of the solidary debtors or some or all of them ‘simultaneously 4. The demand made against one of the solidary debtors shall not be an obstack idary a le to those ‘which may Subsequently be directed against the other deblors, 80 long as the debt has not been fully collected. —¢BL.G _5. Payment made by one of the solidary debtors does nat extinguish the obligation Fumio ‘Scanned with CamScannerCourse Code: BAM 026 Module #7 Name: _ Class number Section: __ Schedule: Date: 6. If two or more solidary debtors offer to pay, the creditor should choose the one who made the first offer. snap = _7. The solidary debtor who made the payment may claim form his co-debtors only the share which cGrresponds to each, with interest. _ tee _8 If one of the solidary debtors cannot reimburse because of insolvency, his co-debtors Must pay his share in proportion the debt of each, 9. Payment by a solidary debtor shall not entitle him to reimbursement from his co-debtors payment is made before the obligation has prescribed or become illegal. apfer 10. The remission made by the creditor of the share which affects one of the solidary debtors does not release the latter from his responsibility towards the co-debtors, in case the debt had been totally paid by anyone of them after the remission was effected, A.LESSON WRAP-UP Activity 6: Thinking about Learning Congratulations for finishing this module! Shade the number of the module that you finished 2 7 % tes Te Te te 1? Te be bea Paz Tas [ae Ds [ae [ar [se Tas Te Tat ae Ts Ts Ts Te Did you have challenges leaming the concepts in this module? If none, which parts of the module helped you leam the concepts? Ne ‘Some question/s | want to.ask my teacher about this module is/are: sone. FLM 3.0 ‘Scanned with CamScannerlS PHINMA EDUCATION Se VS TER ROUGH EN AMIOS. Course Code: BAM 026 Module #7 Name Class number: Section: ‘Schedule: Date’ ~ Learning Scores ‘Action Plan : ] Target/Topic Whal module# did you | wnat were your | What contnbuted to the quality of ‘your | What's the | do? What were the | 2" Nee "OT performance today? What wil you do next date today? | learning targets? What session to maintain your performance or activities? activities did you do? improve it? | © Faas 2 RULES IN CASE THING HAS BEEN LOST OR PRESTATION HAS BECOME IMPOSSIBLE. Ifthe thing has been lost orif the prestation has become impossible without the fault of the solidary debtors, the obligation shall be extinguished. If there was fault on the part of any one of them, all shall be responsible to the creditor, for the price and the payment of damages and interest, without prejudice to their action against the guilty or negligent debtor. If through a fortuitous event, the thing is lost or the performance has become impossible after one of the solidary debtors has incurred in delay through the juidicial or extra judicial demand upon him by the creditor, the provisions of the preceding paragraph shall apply. ° FLM 1.0 ‘Scanned with CamScannerLy PHINMA EDUCATION Course Code: BAM 026 Module #8 Name: _Aj - i Nah Class number: Section’ Schedule: Date’ Lesson Title: DIFFERENT KINDS OF OBLIGATION Part 5 Divisible and Indivisible Obligation & Obligation with a Penal Clause Lesson Objectives: At the end of this module, I-can: 1. Distinguish between divisible and indivisible obligation 2. Define obligation with a penal clause. 3. Enumerate the kinds of division and indivisibilty. 4, Understand other pertinent provisions. Materials: Student Activity Sheet References: Law on Obligations and Contract by Atty. Andrix D. Domingo,CPA,MBA [ Productivity Tip: | Everyone wants to be successful. One way to attain success is to make sure that you preosermm | win your everyday battles. No matter how slow, progress is progress. My challenge as #8 #6 a | for you today is to never let go of this module unless you are done! Happy learning! A. LESSON PREVIEW/REVIEW 4) Introduction (2 mins) This is your 8" and final module for the 1* period. This module will tackle the last three kinds of * obligation. 1. Pure Obligation 2. Conditional Obligation 3. Obligation with a Term or Period 4. Alternative Obligation 5, Facultative Obligation 6. Joint Obligation 7. Solidary Obligation 8. Divisible Obligation 9. indivisible Obligation eee 10. Obligation with a Penal Clause Inlvisible From our previous lessons, you learned that divisibilty or indivsibilty refers to the object or prestation. More” s0, indivisibilty of the obligation will not automatically imply that the obligation is solidary. In fact, divisible object can be a subject matter of a solidary obligation. Divisible FLm 1.0 ‘Scanned with CamScannerLY PHINMA EDUCAT! 1ON r Course Code: BAM 026 Module #8 etl Class number: Section: ‘Schedule Date: a 2) Activity 1: What | Know Chart, part 1 (3 mins) Try answering the questions below by writing your ideas under the first column What | Know. What iKnow ‘Questions: What I Learned Divirlore in the, Ye =¢ obligatio being changecl hile’ the indivivibly obligation will This ptnctions to Mrengthen the. werave Fore’ °F RE wbligaton, 1, Distinguish between divisible [oivarible obligation ar a oy and indivisible obligation. lis vurpectible, oF poses I clause. performance without ae, enences of tHe oie | a9 Ioranged ond indi vivian sbyec’ which UW net chuce pricy lop portial perpormance} aad the, 2. Define obligation with @ penal eben : 7 ed KM me With an decexican wnaertaking by i Je & Which hE Ceti is mney a. greater lige lin cope when its Sb}ech treanttd 4 Certai hunber oF aa of work which by their nature, ore Surcep tlle of eco porrornancey - 3 When 1s obligation considered as divisible? [otic of ite! atigaton wren Gomeswing) | Ww alreooy |Aelivered or ther obligerrion has been petrormecl: thy give deg - nite, things and Hele, which are nae Sur eptible 4, When is obligation considered > as indivisible? tr is one of the OF partial percormance - ok) cut which | fete detwery jor Perpormane ig rot capable OF FLM 10 partial pulpit ment ‘Scanned with CamScannerly PHINMA EDUCATION Course Code: BAM 026 Module #8 Name: Class number: Section: Schedule: Date: B, MAIN LESSON 1) Activity 2: Pre-Printed Content Notes (13 mins) DIVISIBLE OBLIGATION: A divisible obligation is one the object of which, in its delivery or performance, is capable of partial fulfillment. INDIVISIBLE OBLIGATION: ‘An indivisible obligation is one the object of which, in its delivery or performance, is not capable of partial fulfillment. The possibility of partial performance or delivery of the object is not the controlling circumstance in determining whether an obligation is a divisible or indivisible obligation. It is the purpose of the obligation and the intention of the parties which determines whether the obligation is divisible or indivisible. However, if the object is not physically divisible or the service is not susceptible of partial performance or partial delivery, the obligation is always indivisible and this rule is absolute. | showed you a picture a while back of one red car and five books. % if the object of the obligation is the red car, which is not physically divisible, the obligation is an indivisible obligation, % Ifthe object of the obligation is 5 books, which is susceptible of partial delivery, the obligation DEPENDS upon the purpose or intention of the parties. ‘© Itis a divisible obligation if the intention of the parties is divisibility which is to effect delivery of the books at different dates. © Itis an indivisible obligation if the intention of the parties is indivisibility which is to effect delivery of all 5 books at once. . KINDS OF DIVISION 1. Qualitative Division ~ based on quality of things which are the object of the obligation. Example: A and B agreed to divide the partnership assets. A agreed to take alll the furniture and B agreed to take the computer and fax machine 2. Quantitative Division — based on quantity of things which are the object of the obligation. Example: A and 8 agreed to divide the 500 sacks of palay that they harvested into 2 equal parts. Fumi9 ‘Scanned with CamScannerLS PHINMA EDUCATION ‘AKING LES BETTER THRO 1 EDUCATION Course Code: BAM 026 Module #8 Name: Class number: __——— Section: Schedule: Date: 3. Ideal or Intellectual Division — which exists only in the minds of the parties. Example: A and B inherited a car from their parents. They became co-owners with equal rights over the car. Neither of them can say that he is the absolute owner of a specific parts thereof. KINDS OF INDIVISIBILITY: 1. Legal indivisibility - where a specific provision of law declares as indivisible, obligations which, by their nature, are divisible. It is when the law declares indivisibility regardless if the thing is capable of division. 2. Conventional Indivisibility — where the will of the parties makes as indivisible, obligation which, by their nature, are divisible. It is when the parties agreed that the obligation is indivisible even if the thing is actually capable of division. 3. Natural Indivisibility - where the nature of the object or prestation does not admit of division EFFECT OF NON-COMPLIANCE BY A DEBTOR IN A JOINT INDIVISIBLE OBLIGATION: It is a scenario where the object is indivisible by nature yet the debtors are jointly liable. Like when A, B and C obliged themselves to deliver a specific car to X. A and B are willing but C does not want to comply with the obligation What do you think is the effect of the non-compliance of C? What is the extent of liability of A and B? Article 1224. A joint indivisible obligation gives rise to indemnity for damages from the time anyone of the debtors does not comply with his undertaking. The debtors who may have been ready to fulfil their promises shall not contribute to the indemnity beyand the corresponding portion of the price of the thing or of the value of the service in which the obligation consists. According to Article 1224, C will be liable for damages. A and 8, nla wam ages fs because they are willing to comply, are not liable for damages. ae bliin Ht Fa? Hat If the value of the car is Php150,000 ‘A—Php50,000 B— Php50,000 C ~ Php50,000 plus damages OBLIGATION WITH A PENAL CLAUSE Article 1226. In obligations with a penal clause, the penalty shall substitute the indemnity for damages and the payment of interests in case of non-compliarice, if there is no stipulation to the contrary. Nevertheless, damages shall be paid if the obligor refuses to pay the penalty or is guilty of fraud in the fulfilment of the obligation The penalty may be enforced only when it is demandable in accordance with the provisions of this Code. 4 Fumi ‘Scanned with CamScannerLS PHINMA EDUCATION Course Code: BAM 026 Module #8 Name: Class number: Section: ‘Schedule: Date: What is penal clause? Penal Clause is an accessory contract or undertaking attached to an obligation to assume greater liability is case of breach of principal contract. Literally, it is a document that contains all the possible penalty for breach of the principal contract. ® Principal obligation - one which can stand by itself and does not depend for its validity and existence upon another obligation 7 % Accessory obligation — one which is attached to a principal obligation and cannot stand alone. Purpose of Penal Clause: % To ensure the performance of obligation by providing for penalty in case of breach of contract or non- compliance. % To avoid litigation in court, the penalty agreed upon takes the place of the indemnity for damages and the payment of interests in case of non-compliance Kinds of Penal Clause as to Purpose: 1. Compensatory — when the penalty takes the place of damages 2. Punitive — when the penalty is imposed merely as punishment for breach WHEN PENALTY MAY BE REDUCED BY COURT Penal clause is part of the agreement of the parties. As you leamed from our previous lessons that our Constitution guaranteed our freedom to enter into contracts provided that it is not prohibited by law or against morals, customs, public order and public policy But the court may reduce the penalty agreed upon in the penal clause whenever: 3 There is a partial or irregular performance When the penalty agreed upon is iniquitous or unconscionable EFFECT OF NULLITY OF THE PRINCIPAL OBLIGATION: % Ifthe principal obligation is void, the penal clause is likewise void. % If the penal clause is void does not mean that the principal obligation is also void. Article 1230. The nullity of the penal clause does not carry with it that of the principal obligation. The nullity of the principal obligation carries with it that of the penal clause. FL 10 ‘Scanned with CamScannerLS PHINMA EDUCATION . ‘MAKING UVES BETERTH IROL DLIATION Course Code: BAM 026 Module #8 Name: Class number: _______— Section: ‘Schedule Date: 2) Activity 3: Skill-building Activities (with answer key) (18 mins + 2 mins checking) pork 4 Exercise | 1. Explain the difference between the indivisibility of the thing and indivisibility of an obligation. Salinead oe geet 4, Explain the following a, Legal indivisibility b. divisible obligation «. indivisible obligation sptrcrtion oF laut whe} wai da ie = natpechile/ ne divivior A, ayer a porate Far LE ie nok divide by nature: 3) Activity 4: What | Know Chart, part 2 (2 mins) It's time to answer the questions in the What / know chart in Activity 1. Log in your answers in the table. 6 rum 1.0 ‘Scanned with CamScannerea PHINMA EDUCATION MARING LIVES BETTE THONG EDLCANON Course Code: BAM 026 Module #8 Class number: Section Schedule 3 Date: & 4) Activity 5: Check for Understanding (5 mins) we Exercise |. TRUE or FALSE “QU _1. If anyone of the debtors does not comply with his undertaking in a joint indivisible Obligation, the obligation is converted into one for damages. “1wue _2. Principal obligation is one which cannot stand alone. Wz 3. Penal clause does not depend for its validity and existence upon another obligation. “teu ___4. Penal clause has forits purpose the substitution of a penalty for the indemnity for damages in case of non-compliance Rye _5. Penalty may not be reduced if the same is iniquitous or unconscionable. Q U A, LESSON WRAP-UP ee Activity 6: Thinking about Learning Congratulations for finishing this module! Shade the number of the module that you finished a z a Ree es eee eee eo Te Ts Te Did you have challenges learning the concepts in this module? If none, which parts of the module helped you learn the concepts? 4 Some question/s | want to ask my teacher about this module is/are: None. 7 FLM 1.0 ‘Scanned with CamScannera PHINMA EDUCATION ‘giv UES BET ROUEN EDLCATION Course Code: BAM 026 Module #8 Name: Class number: Section: Schedule Date pe Learning Scores ‘Aetion Plan TargetTopic What moduledt did you What contributed to the quality of your What's the | do? What were the | WNat Were Your) A rormance today? What will you do next scores in the date today? | learning targets? What ‘session to maintain your performance or activities? activities did you do? improve it? a {> FAQs % The following are obligations that are considered as indivisible: ‘© Obligation to give definite things © Obligation which are not susceptible of partial performance © Obligations provided by law to be indivisible even if thing or service is physically divisible : © Obligations intended by the parties to be indivisible even if thing or services is physically divisible. # The following are obligations that are considered as divisible: ‘© Obligations which have for their object the execution of a certain number of days of work. ‘© Obligations which have for their object the accomplishment of work by metrical units © Obligations which by their nature are susceptible of partial performance rum 10 ‘Scanned with CamScanner