Article 1215: Novation, compensation, confusion or remission of the debt, made by any of

the solidary creditors or with any of the solidary debtors, shall extinguish the obligation,
without prejudice to the provisions of Article 1219.

The creditor who may have executed any of these acts, as well as he who
collects the debt, shall be liable to the others for the share in the obligation corresponding to
them.

 Novation, compensation, confusion or remission are all modes of extinguishment of

obligations.
 The solidary creditor who extinguishes the credit or have received the payment should be
liable to his co-creditors for the latter’s corresponding shares.

Article 1216: The creditor may proceed against any one of the solidary debtors or some or
all of them simultaneously. The demand made against one of them shall not be an obstacle
to those which may subsequently be directed against the others, so long as the debt has not
been fully collected.

 In solidary obligation, any of the creditors may demand any or some or all of the solidary
debtors simultaneously so long as it has not been fully collected.
 Bringing of an action before the court against a solidary debtor does not preclude the
bringing of another to compel the others to fulfil their obligations.

Article 1217: Payment made by one of the solidary debtors extinguishes the obligation. If
two or more solidary debtors offer to pay, the creditor may choose which to accept.

He who made the payment may claim from his co-debtors only the share which
corresponds to each, with the interest for the payment already made. If the payment is made
before the debt is due, no interest for the intervening period may be demanded.

When one of the solidary debtors cannot, because of his insolvency, reimburse
his share to the debtor paying the obligation, such share shall be borne by all his co-debtors,
in proportion to the debt of each.

 Example: A, B, and C are jointly and severally liable to D and E in the amount of P6,000.
A paid D the whole amount on March 5 even if the due date was March 7.
(a) By par. 1, obligation of A,B, and C to D and E are already extinguished
(b) By par. 2, A can demand payment from B and C P2,000 each. B and C becomes joint
debtors liable for P2,000 each to A. The interests though will only be applied after the
due of the original obligation, which is March 7, even if A has paid in March 5.
(c) Let’s say C is insolvent. By par. 3, A can still demand P1,000 more from B, as they
must jointly share the burden of insolvency of C. A and B can then later demand P1,000
each from C if he recovers.
Article 1218: Payment by a solidary debtor shall not entitle him to reimbursement from his
co-debtors if such payment is made after the obligation has prescribed or become illegal.

Article 1219: The remission made by the creditor of the share which affect one of the solidary
debtors does not release the latter from his responsibility towards the co-debtors, in case debt
had been totally paid by anyone of them before the remission was affected.

 Example: A and B are solidary liable to C with an amount of P2,000. If A pays for his share
of P1,000 to C, even if C accepts, shall not release him from his responsibility to be a
solidary debtor. If C demands A to pay for the other P1000 because B did not, A is
compelled to do so.
 If in the same case, B decided to pay C P2,000. A shall not be liable for the P1,000 since
he has already paid. B can demand the return of P1,000 from C by solution indebiti.

Article 1220: The remission of the whole obligation, obtained by one of the solidary debtors,
does not entitle him to reimbursement from his co-debtors.

 The reason for this provision is that remission was gratuitous, hence, the solidary debtor
who obtained it did not pay for the obligation. Thus, he shall not have the right to collect
any payment.

Artilce 1221: If the thing has been lost or if 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 judicial or
extrajudicial demand upon him by the creditor, the provisions of the preceding paragraph
shall apply.

 Example: A,B, and C obliged themselves solidarily to deliver to D a particular truck valued
at P300,000.
(a) Loss without fault or delay (par. 1) – If the truck is lost through a fortuitous event before
delay incurs, the obligation is extinguished.
(b) Loss is due to fault on the part of a solidary debtor (par. 2) – If the truck was lost with
fault of C, A and B are still liable for the damages and price of truck, but they can
recover the same from C, if they have already contributed. If the damages recovered
from A is P10,000, he can reimburse the same from C only and not from B. If D
recovers the price and damages from C, the latter cannot claim reimbursement from A
and B.
(c) Loss is without fault but after delay (par. 3) – Damages can be recovered by D from A
and B without prejudice to the right of action of A and B to C.
Article 1222: A solidary debtor may, in actions filed by the creditor, avail himself of all
defences 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.

 Defenses available by a solidary debtor in case a creditor demands from him:

(a) Defenses derived from the nature of the obligation – if by the nature of the obligation
it is deemed extinguished, then it is a complete defense for the debtor.
Examples: fraud, prescription, remission, etc.
(b) Defenses personal to the debtor’s own share – one can use his own circumstance as a
defense.
Example: Own insanity, own incapacity, etc.
(c) Defenses personal to other solidary debtors – oen can use the circumstance of the other
debtors to affect the latter’s share so that he may not pay for that debtor’s share.
Example: violence, mistake, minority, incapacity, etc.

Article 1223: The divisibility or indivisibility of the things that are the object of obligations
in which there is only one debtor and only one creditor does not alter or modify the provisions
of Chapter 2 of this Title.

 Divisible obligation – the object of which, in its delivery or performance, is capable of

partial fulfillment.
 Indivisible obligation – the object of which, in its delivery or performance, is not capable
of partial fulfillment.
 The divisibility or indivisibility that this article pertains to is to the obligation itself not the
thing or object of the obligation. Hence, a thing can be divisible but still be an indivisible
obligation if the stipulation makes it so.
Example: An amount of P10,000 is divisible as it can be partially be given but if a debtor
is obliged to give P10,000 to a creditor, the former cannot give only P5,000 as complete
fulfillment of payment is presumed by the law. (Art. 1233)
 In Nazareno vs. CA, the Court rejected the argument of petitioners that the Deed of Sale of
6 parcels of land was indivisible because of the Deed’s inability to be partly litigated
against as it was made during the marriage of their parents, making it a conjugal property.
The Court said that it was indivisible because, by the nature of the stipulation, selling 6
parcels of land in just one Deed of Sale.
 In Sps. Lam vs Kodak, the Court ruled that even though the things to be delivered by Kodak
was listed and that there are three sets of it, susceptible of partial fulfillment by the nature
of the thing, the obligation is still indivisible because of the nature of the prestation. The
nature is indivisible because Kodak sold all three sets by package, evidenced by the
discount spouses Lam got, and that it was made only in one document, which if the
intention was really to make it divisible, they could have easily made three documents
selling one set each.
 Kinds of division:
(1) Qualitative – based on quality of the object of the obligation
(2) Quantitative – based on quantity
 (3) Ideal or intellectual – exists only in the minds of the parties. Most common example is
an indivisible object (car, house, etc.) which is still owned by two or more owners
equally. There is a division in which the property is divided even though physically
impossible to.
 Kinds of indivisibility:
(1) Legal – provision of the law declares the obligation divisible which by nature are
divisible.
(2) Conventional – indivisibility is based on stipulations.
(3) Natural indivisibility – nature of the object or prestation does not admit division.

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 beyond the corresponding
portion of the price of the thing or of the value of the service in which the obligation consists.

 Effect of non-compliance by a debtor in a joint indivisible obligation:

(1) Obligation is transformed into damages – the debtors who can comply shall pay money
for their compliance. They cannot be demanded by the creditor to comply with the other
debtors who cannot comply.
(2) The contribution of innocent debtors is limited to their respective shares.

Article 1225: For the purposes of the preceding articles, obligations to give definite things
and those which are not susceptible to give definite things and those which are not susceptible
of partial performance shall be deemed to be indivisible.

When the obligation has for its object the execution of a certain number of
days of work, the accomplishment of work by metrical units, or analogous things which by
their nature are susceptible of partial performance, it shall be divisible.

However, even though the object or service may be physically divisible, an

obligation is indivisible if so provided by law or intended by the parties.

In obligations not to do, divisibility or indivisibility shall be determined by the

character of the prestation in each particular case.

 Obligations deemed indivisible:

(1) Obligation to give definite things; (car, house, etc.)
(2) Indivisible by natural indivisibility; (singing a song, etc.)
(3) Indivisible by legal indivisibility. (tax, complete fulfillment, etc.)
 Obligations deemed divisible:
(1) Have for their object the execution of a certain number of days of work;
(2) Have for their object the accomplishment of work by metrical units;
(3) By their nature are susceptible of partial performance.
 Personal obligations are generally indivisible.
Exception: “to do” in par. 2, “not to do” in par. 4
Article 1226: In obligations with a penal clause, the penalty shall substitute the indemnity
for damages and the payment of interests in case of noncompliance, 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 fulfillment of the obligation.

The penalty may be enforced only when it is demandable in accordance with

the provisions of this Code.

 Principal Obligations – can stand by itself and does not depend for its validity and existence
upon another obligation
 Accessory obligation – attached to a principal obligation and so cannot stand alone
 Obligation with a penal clause – contains an accessory added to make the debtor pay a
stipulated indemnity in case of breach of fulfillment of the principal prestation intended to
induce its fulfillment.
 Penal Clause – accessory attached to an obligation to assume greater liability on the part
of the debtor in case of breach.
 Purposes of Penal Clause:
(1) Insure the performance of obligation
(2) Substitute a penalty for the indemnity for damages (Compensatory penal clause)
(3) Punish the debtor for the non-fulfillment (Punitive penal clause)
 Obligations with penal clause are strictly construed.
 Effectivity of penal clause:
(1) Subsidiary or alternative penal clause – only the penalty can be enforced.
(2) Joint or cumulative penal clause – both principal obligation and penal clause are
enforceable.
 As a general rule, penal clause substitutes for damages and interests.
Exceptions:
(1) Penalty and interests are demandable – when interests are not stipulated, it can be
demanded as it is different to the penalty.
(2) Penalty, interests and damages are demandable:
(a) By stipulation;
(b) Obligor refuses to pay penalty;
(c) Obligor is guilty of fraud.
 In Country Bankers vs. CA, the Court ruled that the penal clause of forfeature of deposit
and bond made as a deposit in a lease can be validly taken by the creditor as a punishment
for the debtor’s breach of contract. Hence, the creditor can still get damages and interests
independent of the penalty.

Article 1227: The debtor cannot exempt himself from the performance of the obligation by
paying the penalty, save in the case where this right has been expressly reserved for him.
Neither can the creditor demand the fulfillment of the obligation and the satisfaction of the
penalty at the same time, unless this right has been clearly granted him. However, if after
the creditor has decided to require the fulfillment of the obligation, the performance tgereif
should become impossible without his fault, the penalty may be enforced.

 General Rule: Debtor cannot pay the penalty only instead of performing the obligation.
 Exception: This right has been expressly given to him.
 General Rule: Penal clause are subsidiary, meaning penalty and principal cannot be
demanded at the same time.
Exception: The right has been clearly granted to him, which makes the pena clause joint.

Article 1228: Proof of actual damages suffered by the creditor is not necessary in order that
the panlty may be demanded.

 General Rule: Proof of actual damages are not needed.

Exception: When damages or interests are demanded independent of the penalty.

Article 1229: The judge shall equitably reduce the penalty when the principal obligation has
been partly or irregularly complied with by the debtor. Even if there has been no
performance, the penalty may also be reduced by the courts if it is iniquitous or
unconscionable.
 Penalty may be reduced by the courts:
(1) When there is partial or irregular performance – penalty should be less or more
proportionate with the extent of the breach of contract or the damage suffered. There
are still damages since complete fulfillment is needed to extinguish an obligation.
(2) When penalty is iniquitous or unconscionable
 In Commercial Credit Corp. vs. CA, the SC reversed the ruling of the CA equitably
lowering the penalty by reason of Article 1229 because (1) the penalty of 3% monthly and
5% of the outstanding balance is lawful, and is not against public policy or morals; and (2)
the compromise agreement, where the said penalty is in, was already judicially accepted
by a court, and thus, Article 1229 cannot be applied as it only applies to obligations or
contracts which are not yet subjected to a litigation.
 In Asiatrust Development Bank vs. Concepts Trading Corporation, the Court ruled to
equitably reduce the 36% yearly interest of Asiatrust because (1) Concepts has partly
complied with the obligation to the point that they have already paid more than the original
debt; and (2) 36% interest is iniquitous as it is not lawful and against public policy or
morals.

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.

 If only the penal clause is void, the principal remains valid and the penal clause is just
disregarded.
 If the principal obligation is void, the penal clause must also be disregarded as the penal
clause is only an accessory, hence, cannot stand on its own.