Oblicon Art. 1380-1404 Outline
Article 1380
❖ Rescissible Contracts
➢ Those validly agreed upon because all the essential elements exist and, therefore, legally effective.
➢ They are valid and enforceable although subject to rescission by the court when there is economic damage or prejudice to one of the parties or to a third person.
▪ Rescission
➢ A remedy granted by law to the contracting parties and to third persons in order to secure reparation of damages caused by a valid contract
▪ Requisites of rescission 1. Contract is valid 2. There is lesion/ pecuniary prejudice 3. Based upon a case especially provided by law 4. No other legal remedy 5. Party asking for rescission must be able to return what he is obliged to restore 6. Object not in legal possession of another 7. Period to file not prescribed
Article 1381
▪ 5 types of rescissible contracts 1. Contracts entered into in behalf of wards 2. Contracts agreed upon in representation of absentees 3. Contracts undertaken in fraud of creditors a. existing credit prior to the contract to be rescinded b. fraud on the part of the debtor c. creditor cannot recover his credit in any other manner 4. Contracts which refer to things under litigation 5. All other contracts specially declared by law to be subject to rescission
Article 1382
▪ Payments made in a state of insolvency
***Payments made in state of insolvency for obligations to whose fulfilment the debtor could not be compelled at the time of they were effected, are also rescissible.***
Article 1383
▪ Nature of action for rescission o Rescission is not a principal remedy; only subsidiary, meaning that it can be availed of only if the injured party proves that he has no other legal means aside from rescinding the contract to obtain redress for the damage caused.
Article 1384
▪ Extent of rescission o The rescission shall only be to the extent of the creditor’s unsatisfied credit.
Article 1385
▪ Rescission creates obligation of mutual
❖ Rescissible Contracts
➢ Those validly agreed upon because all the essential elements exist and, therefore, legally effective.
➢ They are valid and enforceable although subject to rescission by the court when there is economic damage or prejudice to one of the parties or to a third person.
▪ Rescission
➢ A remedy granted by law to the contracting parties and to third persons in order to secure reparation of damages caused by a valid contract
▪ Requisites of rescission 1. Contract is valid 2. There is lesion/ pecuniary prejudice 3. Based upon a case especially provided by law 4. No other legal remedy 5. Party asking for rescission must be able to return what he is obliged to restore 6. Object not in legal possession of another 7. Period to file not prescribed
Article 1381
▪ 5 types of rescissible contracts 1. Contracts entered into in behalf of wards 2. Contracts agreed upon in representation of absentees 3. Contracts undertaken in fraud of creditors a. existing credit prior to the contract to be rescinded b. fraud on the part of the debtor c. creditor cannot recover his credit in any other manner 4. Contracts which refer to things under litigation 5. All other contracts specially declared by law to be subject to rescission
Article 1382
▪ Payments made in a state of insolvency
***Payments made in state of insolvency for obligations to whose fulfilment the debtor could not be compelled at the time of they were effected, are also rescissible.***
Article 1383
▪ Nature of action for rescission o Rescission is not a principal remedy; only subsidiary, meaning that it can be availed of only if the injured party proves that he has no other legal means aside from rescinding the contract to obtain redress for the damage caused.
Article 1384
▪ Extent of rescission o The rescission shall only be to the extent of the creditor’s unsatisfied credit.
Article 1385
▪ Rescission creates obligation of mutual