CONTRACTS

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CONTRACTS by Mind Map: CONTRACTS

1. CHARACTERISTICS

1.1. 1. Freedom or Autonomy 2. Obligatoriness of Contracts 3. Mutuality 4. Consensuality 5. Relativity

2. GENERAL RULE

2.1. Third person has no rights and obligations under a contract to which he is a stranger. (Art. 1311)

2.2. EXCEPTION

2.2.1. 1. Contracts stipulating in favor of a 3rd person, 1311 (2) (pour autrui) 2. Contracts creating real rights (1312) 3. Contracts entered to defraud creditors (1313) 4. Contracts which have been violated at the inducement of 3rd person.

2.2.1.1. STIPULATION POUR AUTRUI

2.2.1.1.1. DEFINITION

2.2.1.1.2. REQUISITES

3. CLASSIFICATION

3.1. THEORIES OF PERFECTION

3.1.1. MANIFESTATION

3.1.1.1. moment the acceptance is made

3.1.2. EXPEDITION

3.1.2.1. moment the offeree transmits notifaction of acceptance to the offeror

3.1.3. RECEPTION

3.1.3.1. received but no knowledge by reason of absence, sickness, etc.

3.1.4. COGNITION

3.1.4.1. upon actual knowledge

3.2. ACCORDING TO PERFECTION

3.2.1. CONSENSUAL

3.2.1.1. perfected by mere consent

3.2.2. REAL

3.2.2.1. perfected by the delivery of the thing

3.2.3. SOLEMN

3.2.3.1. requires compliance with formalities

4. DEFINITION

4.1. is a meeting of minds between two persons whereby one binds himself, with respect to the other, to give something or to render service (1305)

5. REQUISITES

5.1. CONSENT of the contracting parties

5.1.1. REQUISITES OF CONSENT

5.1.1.1. 1. manifested by concurrence of the offer and acceptance 2. parties must possess legal capacity 3. must be intelligent, free, spontaneous, and real

5.1.2. CONSENT AND OFFER DISTINGUISHED

5.1.2.1. CONSENT manifested by the meeting of the offer and the acceptance upon the thing and cause which constitutes a contract

5.1.2.2. OFFER unilateral proposition which one party makes for celebration of a contract

5.1.3. CANNOT GIVE CONSENT TO A CONTRACT

5.1.3.1. UNEMANCIPATED MINORS

5.1.3.1.1. GENERAL RULE

5.1.3.2. INSANE/DEMENTED, AND DEAF-MUTES WHO DO NOT KNOW HOW TO WRITE

5.1.4. DISQUALIFICATION/PROHIBITION AND INCAPACITY DISTINGUISHED

5.1.4.1. DISQUALIFICATION/PROHIBITION

5.1.4.1.1. - Restrains the very right itself, absolute disqualification from entering to contract - VOID

5.1.4.2. INCAPACITY

5.1.4.2.1. - Restrains the exercise of right to contract; can still enter provided guardian present - VOIDABLE

5.1.5. OPTION CONTRACT

5.1.5.1. WITH CONSIDERATION

5.1.5.1.1. cannot withdraw his offer

5.1.5.2. WITHOUT CONSIDERATION

5.1.5.2.1. can withdraw by communicating withdrawal to the offeree at anytime before acceptance

5.1.6. VICES OF CONSENT

5.1.6.1. DEFINITION

5.1.6.1.1. present at the perfection of the contract and not in the performance of the obligation

5.1.6.2. VICES THAT MAKE THE CONTRACT VOIDABLE

5.1.6.2.1. MISTAKE

5.1.6.2.2. VIOLENCE

5.1.6.2.3. INTIMIDATION

5.1.6.2.4. UNDUE INFLUENCE

5.1.6.2.5. FRAUD

5.1.6.3. VICES THAT MAKE THE CONTRACT VOID

5.1.6.3.1. SIMULATION OF CONTRACT

5.2. OBJECT/PRESTATION which is the subject matter of the contract

5.2.1. DEFINITION

5.2.1.1. - thing, right or service which is the subject matter of the obligation arising from contract - without which the negotiations never have begun

5.2.2. REQUISITES

5.2.2.1. 1. Must be within the commerce of men (1347) - susceptible of appropriation and transmissible from one to another 2. Should be real or possible (1348) - should exist at the moment of the celebration of the contract, or at least can exist in the future 3. Should be licit (1347) - not to contrary to law, morals, good customs, public order or public policy 4. Should be determinate or at least possible of determination, as to its kind

5.2.2.1.1. OUTSIDE THE COMMERCE OF MEN

5.2.3. CANNOT BE OBJECT OF A CONTRACT

5.2.3.1. GENERAL RULE

5.2.3.1.1. All things/services may be object of contract including future things or rights

5.2.3.2. EXCEPTION

5.2.3.2.1. 1. Things outside the commerce of men 2. Intransmissible rights 3. Future inheritance, except in cases expressly authorized by law 4. Services contrary to law, morals, public policy/order 5. Impossible things or services (absolute) 6. Objects not possible of determination as to its kind

5.2.4. IMPOSSIBILITY

5.2.4.1. CONDITIONAL CONTRACT

5.2.4.1.1. its efficacy should depend upon the future existence of the thing

5.2.4.2. ALEATORY CONTRACT

5.2.4.2.1. one of the contracting parties will bear the risk that the thing will never come into existence

5.3. CAUSE OF THE OBLIGATION which is established

5.3.1. DEFINITION

5.3.1.1. immediate, direct or most proximate reason which explains and justifies the creation of an obligation through the will of the contracting parties.

5.3.2. REQUISITES

5.3.2.1. 1. Existing at the time of the celebration of contract 2. Licit 3. True

5.3.3. CAUSE AND OBJECT DISTINGUISHED

5.3.3.1. CAUSE - service/benefit which is given in remuneration - liberality of the donor - prestation/promise of a thing by the other - different with respect to each party (onerous contract

5.3.3.2. OBJECT - thing which is given in remuneration - thing which is donated - the thing/service itself - may be the same for both parties (onerous contract)

5.3.4. CAUSE AND MOTIVE DISTINGUISHED

5.3.4.1. CAUSE - direct & most proximate reason of contract - juridical reason - always the same for each party - its legality affects validity of contract

5.3.4.2. MOTIVE - indirect or remote reason - psychological or purely personal reason - differs for each contracting party - legality does not affect validity of contract

5.3.4.2.1. Motive becomes cause when it predetermines the purpose of the contract.

5.3.5. CAUSE IN:

5.3.5.1. ONEROUS CONTRACT

5.3.5.1.1. prestations or promise of a thing by another

5.3.5.2. REMUNERATORY

5.3.5.2.1. past service or benefit which by itself is a recoverable debt

5.3.5.3. GRATUITOUS

5.3.5.3.1. mere liberality of benefactor

5.3.5.4. ACCESSORY

5.3.5.4.1. the same as that of principal contract

5.3.6. MORAL OBLIGATIONS AS CAUSE

5.3.6.1. Unconnected with any civil obligations, cannot constitute sufficient cause therefore not demandable

5.3.6.2. Based upon previous civil obligation which has already barred by statute of limitation -> constitutes sufficient cause

5.3.7. IRREGULARITIES

5.3.7.1. LACK OF CAUSE

5.3.7.1.1. CAUSE

5.3.7.1.2. EFFECT

5.3.7.2. ILLEGALITY OF CAUSE

5.3.7.2.1. CAUSE

5.3.7.2.2. EFFECT

5.3.7.3. FALSITY OF CAUSE

5.3.7.3.1. CAUSE

5.3.7.3.2. EFFECT

5.3.7.4. LESION/INADEQUACY OF PRICE

5.3.7.4.1. EFFECT

6. CLASSES OF ELEMENTS

6.1. ESSENTIAL

6.1.1. shall conform; those without which there can be no contract

6.2. NATURAL

6.2.1. they can accept or repudiates; derived from the very nature of contract

6.3. ACCIDENTAL

6.3.1. established by the parties

7. FORMS

7.1. GENERAL RULE

7.1.1. Contracts shall be obligatory in whatever form provided all essential requisites for their validity are present (1356)

7.2. EXCEPTION

7.2.1. 1. When law requires that contracts be in a certain form to be valid (1356; special laws) 2. When law requires that contract be in a certain form to be enforceable (Statute of Frauds) 3. When required to make contract effective as against 3rd parties (1357-1358) - valid as to contracting parties but not to 3rd persons

7.3. FORM OF VALIDITY OF CONTRACT

7.3.1. IN WRITING

7.3.1.1. 1. Donation of personal property whose value exceeds P500 (748) 2. Sale of a piece of land or any interest therein through agent (1874) 3. Agreement regular payment of interest in loan (1956) 4. Antichresis (2134) 5. Stipulation limiting diligence required (1744) 6. Sale of large cattle

7.3.2. PUBLIC DOCUMENT

7.3.2.1. NEEDS CERTAIN FORM TO BE VALID BETWEEN CONTRACTING PARTIES

7.3.2.1.1. 1. Donation of immovable properties (749) 2. Partnership where immovable contributed to common fund (1771 & 1773)

7.3.2.2. CERTAIN FORM TO BE VALID BETWEEN THIRD PARTY (already valid between contracting parties)

7.3.2.2.1. 1. Acts & contracts which have for their object the creation (1358) 2. Cession, repudiation or renunciation of hereditary rights 3. Power to administer property 4. The cession of actions or rights

7.3.3. MUST BE REGISTERED

7.3.3.1. 1. Chattel mortgages (2140) 2. Sa;e/Transfer of large cattle

7.3.3.1.1. NOTE: SALES OF GOODS, CHATTELS OR THINGS IN ACTION ARE GOVERNED BY ART. 1403 (2) & 1405

8. ASPECTS OF CONTRACTS

8.1. INTENT OR WILL

8.1.1. this is internal and as long as a contract exists merely as a psychological fact, it produces no legal effect, because the law cannot take cognizance of its existence

8.2. EXPRESSION OF SUCH INTENT OR WILL

8.2.1. in order for a contract to produce legal effect, intent or will must be expressed