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Article 1191
Article 1191
The injured party may choose between the fulfillment and the rescission of the
obligation, with the payment of damages in either case. He may also seek
rescission, even after he has chosen fulfillment, if the latter should become
impossible.
The court shall decree the rescission claimed, unless there be just cause
authorizing the fixing of a period.
This is understood to be without prejudice to the rights of third persons who have
acquired the thing, in accordance with Articles 1385 and 1388 and the Mortgage
Law. (1124)
Ang hukuman ang mag uutos ng pagpapawalang bisa na hinihingi maliban kung may
makatarungang dahilan para payagan ang pagtatakda ng tiyak ng panahon.
A principal action that is based on breach of a party, (while rescission under Art.
1383 is a subsidiary action limited to cases of rescission for lesion under Art. 1381 of
the New Civil Code).
Abrogate and undo a contract from the beginning
Annul the contract and Restore the parties to the relative positions which they
would have occupied if no such contract had ever been made.
Breach of Faith – the obligor’s failure to comply with an obligation already extant,
not a failure of a condition to render binding that obligation. There can be no
rescission of an obligation that is non-existent, considering that
the suspensive condition therefore has not yet happened.
Application:
-Article on applies to Reciprocal Obligations where both parties are mutually Debtor &
Creditor of each other in the same transaction.
[ill. A Contract of Sale of a Brand New Laptop is entered into between Jericho (Buyer)
and Jayson (Seller) at the price of P50,000.00. In absence of stipulation, the delivery
of the laptop by Jayson is conditioned upon the payment of the purchase price by
Jericho or vice versa. Jayson, being the owner and seller of the laptop is the creditor
as to the purchase price and debtor as to the laptop. Whereas, Jordan being the buyer,
is the creditor as to the laptop and debtor as to the purchase price.]
Non-Payment of the purchase price constitute a very good reason to rescind a contract
of sale.
If fulfillment had been chosen but the the same had become impossible, rescission may
still be sought.(Art 1191 par 2)
If there is a valid basis for the extension of the performance of reciprocal obligation, the
court will not decree rescission but will rather fix a period for the fulfillment of the
obligation. (Art. 1191 par 3)
ü The party who has the right to cancel or resolve the reciprocal obligation in
case of non-fulfillment on the part of one contracting parties.
ü The party who is ready, willing and able to comply with his own obligations
ü The party who is in the position to return whatever he may be obliged to return
to the other party
Restrictions:
1.Due Process must be observed; “the court shall decree the rescission , unless, there
be a just cause authorizing a period fixing it” (Art 1191 par 3)
2. Right to rescind is subordinated to the rights of third persons who acquired the thing in
good faith (Art 1191 par4)
3. He must respect the power of the Court to fix period in lieu of decreeing decision
4. Slight breaches of the contract will not justify rescission
Article 1169 discusses that as a GENERAL RULE, a judicial and extra-judicial
demand by the creditor signals the delay to deliver something by the debtor.
The exceptions to the rule are also listed in Art. 1169: Demand may not be
necessary in the following circumstances:
When the TIME is fixed for the fulfillment of the obligation, no further demand
or notice by the obligee or creditor is needed.
In case of DOUBT on whether a debtor is in default of his obligation, the doubt
shall be resolved in the debtor’s favor because dispensing the required
demand is just an exception to the general rule.
Classes of MORA
1. Mora Solvendi – default on the part of the debtor/obligor
Requisites:
Obligation pertains to the debtor/obligor
Obligation is determinate (susceptible of particular designation) or liquidated;
due and demandable
Obligation has not been performed on its maturity date