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Section 2: Loss of the Thing Due Loss: 1. Perishes 2. Goes out of commerce 3.

Disappears in such a way that its existence is unknown or it cannot be recovered Article 1262: Effect of Loss Determinate Obligation to Give in

A SORT OF EXCEPTION: the object is a particular class or group with specific or determinate qualities o Cattles in a particular ranch

Article 1264. Effect of Partial Loss - Shall depend upon the sound discretion of the court Article 1265. Presumption if Thing is loss in the debtors possession (determinate) - Disputable presumption that the loss was due to his fault; the obligation is not extinguished that he is still liable for damages EXCEPTION: Presumption does not apply in case of earthquake, flood, storm or other natural calamity Article 1266. Effect of Impossibility of Performance in Obligation to Do and Not to Do TO DO: - impossibility must have occurred after the constitution of the obligation - TWO CAUSES: o May arise from the law o Physical impossibility - EFFECT: without the fault of the debtor the obligation is extinguished NOT TO DO: - Rules may still apply Article 1267. Impossibility Effect of Relative

Requisites: 1. The thing which is lost must be determinate 2. The thing is lost without any fault of the debtor (if with fault: the obligation is not extinguished; it is simply converted into an obligation to indemnify the creditor for damages.) 3. The thing is lost before the debtor has incurred in delay GEN RULE: If the loss is due to a fortuitous event, the debtor cannot be held liable. (obligation is extinguished) EXCEPTION: 1. By law, the debtor is liable even for fortuitous event 2. By stipulation of the parties 3. Nature of the obligation requires assumption of risk 4. When the loss of the thing is due partly to the fault of the debtor 5. Debtor has incurred in delay 6. When the debtor promised to deliver the same thing to two or more persons who do not have the same interest 7. When the obligation to deliver arises from a criminal offense 8. When the obligation is generic Article 1263: Effect of loss in Generic Obligation to Give - The loss and destruction of anything of the same kind does not extinguished the obligation

GEN RULE: impossibility of performance of an obligation to do shall release the obligor EXCEPTION: when the service has become so difficult as to be manifestly beyond the contemplation of the

parties, the court should be authorized to release the obligor in whole or part Article 1268. Obligation Arises from Criminal Offense GEN RULE: When a thing certain and determinate proceeds from a criminal offense, the debtor shall not be exempted from the payment of its price whatever may be the cause for the loss EXCEPTION: the thing having been offered by him to the person who should receive it, the latter refused without justification Article 1269. Effect of Extinguishment of Obligation The creditor shall have all the rights of action against the third persons by reason of lost EX: Insurer and creditor

1. Express or implied 2. Total or partial 3. Inter vivos or mortis causa

Article 1270. Gratuitous and Necessity of Acceptance Creditor must not have received any price of equivalent There must be acceptance from the debtor

Extent of Remission: Governed by inofficious donations (contrary to moral duty) Heirs of creditor-donor can proceed against the debtor-donee for the reduction or even suppression of the remission.

Section 3: Condonation or Remission of the Debt Void Remissions: Remission- is an act of liberality by virtue of which the oblige, without receiving any price or equivalent, renounces the enforcement of the obligation, as a result of which it is extinguished in its entirely or in that part or aspect of the same to which the remission refers. 1. If the estate of the creditor consists of credits, and there is a remission or condonation of all of such credits, it is evident that there would be a violation of the rule 2. If the remission comprehends future debts- lacks the requisite of demandability and contrary to the precept that donations cannot comprehend future property

Requisites: 1. It must be gratuitous 2. Must be accepted by the obligor 3. Obligation must be demandable

Article 1271-1272. Effect of Delivery of Evidence of Credit to Debtor

Kinds:

Requisites:

1. That the document evidencing the credit must have been delivered by the creditor to the debtor 2. That the document must be a private document 3. That the voluntary delivery must be

c. Remission of the whole obligation, obtained by one of the solidary debtors, does not entitle him to reimbursement from his codebtors

GEN RULE: if the remission refers to the principal obligation, all the accessory obligations are extinguished

Presumption: whenever the private document evidencing the credit is found in the possession of the debtor there arises a presumption that the creditor delivered it to the debtor

EXCEPTION: remission refers to the accessory obligations, the principal obligation continues to subsists

Article 1273-1274. Effect of Remission

RULE IN PLEDGE

Gen Rule: Effect of remission is to extinguish the obligation in its entirety or in the part or aspect thereof to which the remission refers

GEN RULE: presumed that the accessory obligation of pledge has been remitted when the thing pledged, after its delivery to the creditor, is found in the possession of the debtor or a third person who own the thing.

Exceptions: 1. Joint Obligation- the remission can only affect the share of the creditor who makes the remission and the corresponding share of the debtor in whose favor the remission is made 2. Solidary- Article 1215, 1219, 1220 will apply a. Liable to the others for the share in the obligation b. Remission made by the creditor of the share which affects one of the solidary debtor does not release the latter from his responsibility towards the co-debtors