OBLIGATIONS AND CONTRACTS

Drills & Exercises Part II

18 Jan 2020

I. (1) Distinguish between Mutuality and Relativity of Contracts.

(2) Distinguish between Autonomy and Consensuality of Contracts.
(3) What do you understand from Obligatoriness of Contracts?
(4) Is this statement correct? “The object of a contract is also its cause”.

II. According to par. 2 of Article 1347: “No contract may be entered into upon future
inheritance except in cases expressly authorized by law”.
(1) Discuss these instances that are “expressly authorized by law”.
(2) Your friend, Lucio Tan, Jr., son of Lucio Tan, Sr., a Filipino-Chinese billionaire, sought
your advice on how to partition, develop and possibly dispose of his expected inheritance
from his billionaire father who had just died yesterday. What will be your advice, in the
light of the prohibition contained in the aforequoted par. 2 of Art. 1347 of the Civil
Code?

III. Robin, a billionaire and married man, donated a low-cost house & lot to his mistress
Robina, a 15-year old starlet, impelled by his concupiscence and burning desire to
cohabit with her. The Deed of Donation was duly executed, notarized and was accepted
in the same instrument by Robina who, upon the transfer of the title to her, finally
agreed to sweetly surrender her whole being to the will and pleasure of Robin.
Eventually, the validity of the donation was put in issue in a civil action brought by the
legitimate family of Robin against Robina for the annulment of the Deed of Donation on
the ground that it was predicated on an illicit cause. In her answer, Robina’s lawyers
argued that the cause of the donation was the liberality of Robin and that any motive
that he may have had was totally different from such cause and, thus, the donation was
valid.
(1) Would you agree with such an argument? Cite your legal basis.
(2) Who is entitled to the low-cost house & lot?
(3) If, instead of a low-cost house & lot, a P50 Million-peso mansion was donated by
Robin to Robina, would your answer be the same?

IV. Tullanes, a former Naval Officer was charged with Unjust Vexation for his role in the
Fakewood Mutiny. While awaiting trial, he was informed by the Brgy. Chairman that he
would be thrown in jail if he would not be able to submit a surety bond to the court. He,
therefore, reluctantly signed a surety bond agreement and paid the requisite premium in
the amount of P10k. After due notice and hearing, Tullanes was acquitted. He wanted to
refund his premiums but was told that only cash bonds could be refunded, not premiums
for surety bonds. He then sought to get back his premiums by filing an action for
annulment of the surety bond agreement, claiming that he was threatened with
imprisonment if he did not agree to sign the same and pay the corresponding premium.
He claimed that according to his legal advisers, his consent was vitiated when he was
forced to sign the surety bond application for fear of being imprisoned. He sought a 2 nd
opinion from you.
(1) Do you agree with Tullanes and his legal advisers?
(2) What would be your advice to him, if any?

V. A parcel of land consisting of 5 hectares, located in Intramuros Manila, is owned by 5

co-owners, collectively known as Heirs of Dracula (the heirs, for brevity). Van Helsing, a
creditor of the deceased parents of the heirs sent several demand letters to the heirs,
seeking to collect the unpaid purchase price for construction materials used in building
Dracula’s mausoleum and constructing the coffins and tombs found in it.

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 The demands went unheeded. Instead, the heirs decided, orally, to settle,
distribute and partition the estate among themselves by assigning one (1) hectare to
each of them. Subsequently, Van Helsing filed an action for sum of money against the
estate of Dracula. The heirs alleged in their answer that there was no estate to speak of
because the same had already been settled and were already distributed to the 5 of
them. Van Helsing’s lawyer countered that the settlement of the estate could not be
proven or enforced in court because it was made orally; and therefore, the property still
belonged to the estate of Dracula.
(1) As counsel of Van Helsing, how would you argue in support of his position?
(2) If you were the counsel of the heirs, how would you counter the arguments of Van
Helsing’s lawyer?
(3) If you were the judge how would you decide the matter?

VI. What is “consent”, as an essential element of a contract? Explain briefly its

requisites.

VII. What is “object”, as an essential element of a contract? Explain briefly its requisites.

VIII. What is “cause”, as an essential element of a contract? Explain briefly its requisites.

IX. When can a contract be “Reformed”? Explain the requisites.

X.
(a) Explain: “Let us interpret not by the letter that killeth, but by the spirit that giveth
life”.
(b). What is the effect of the “usage or custom” of a locality in interpreting the
ambiguities in a contract? Give an example.
(c) In case of ambiguity in a contract, in whose favor should the ambiguity be resolved?
Why?

-Good Luck-

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