Cases for Obligations CHAPTER 4.
EXTINGUISHMENT OF OBLIGATIONS;
LOSS OR IMPOSSIBILITY
OCCEÑA VS. COURT OF APPEALS – ANSWER Petitioners who are landowners had
a subdivision contract with Tropical Homes Inc, for the development of their land.
Tropical Homes filed a complaint for modification of the terms and conditions of their
contract, alleging that due to the increase in the price of oil and its derivatives and the
concomitant worldwide spiralling of prices of all commodities including basic raw
materials for the development work, the cost of development has risen to levels which
are unanticipated, unimagined, and not within the remotest contemplation of the parties
at the time the agreement was made, such that the conditions and factors which formed
the original basis of the contract have been totally changed.
Tropical Homes Inc.'s complaint for modification of contract cannot be granted. Art.
1267 - When the service has become so difficult as to be manifestly beyond the
contemplation of the parties, the obligor may also be released therefrom, in whole or in
part.
Such cannot be granted for it is not provided for by Art 1267. Performance is not
excused by the fact that the contract turns out to be hard and improvident, unprofitable
or impracticable, ill-advised or even foolish, or less profitable, or unexpectedly
burdensome, since in case a part desires to be excused from performance in the event
of such contingencies arising, it is his duty to provide therefore in the contract.
NAGA TELEPHONE CO. V CA - ANSWERThe parties entered into a contract for the
use by NATELCO of CASURECO's electric light posts in Naga City. In consideration,
petitioners agreed to install, free of charge, 10 telephone connections for the use by
CASURECO. "That the term or period of this contract shall be as long as NATELCO has
need for the electric light posts of the party of CASURECO it being understood that this
contract shall be terminated when for any reason whatsoever, CASURECO is forced to
stop, abandon its operation as a public service and it becomes necessary to remove the
electric lightpost." CASURECO filed a petition for reformation of contract with the RTC
of Naga City on the ground that the agreement it entered into with NATELCO has
become one-sided, inequitous and disadvantageous to the former. The trial court ruled
in favor of CASURECO. The CA affirmed the trial court's decision but on a different
legal basis—Article 1267 of the Civil Code and ruling that the contract contains a purely
potestative prestation making that stipulation void. The Court affirmed the decision of
EXTINGUISHMENT OF OBLIGATIONS;
LOSS OR IMPOSSIBILITY
OCCEÑA VS. COURT OF APPEALS – ANSWER Petitioners who are landowners had
a subdivision contract with Tropical Homes Inc, for the development of their land.
Tropical Homes filed a complaint for modification of the terms and conditions of their
contract, alleging that due to the increase in the price of oil and its derivatives and the
concomitant worldwide spiralling of prices of all commodities including basic raw
materials for the development work, the cost of development has risen to levels which
are unanticipated, unimagined, and not within the remotest contemplation of the parties
at the time the agreement was made, such that the conditions and factors which formed
the original basis of the contract have been totally changed.
Tropical Homes Inc.'s complaint for modification of contract cannot be granted. Art.
1267 - When the service has become so difficult as to be manifestly beyond the
contemplation of the parties, the obligor may also be released therefrom, in whole or in
part.
Such cannot be granted for it is not provided for by Art 1267. Performance is not
excused by the fact that the contract turns out to be hard and improvident, unprofitable
or impracticable, ill-advised or even foolish, or less profitable, or unexpectedly
burdensome, since in case a part desires to be excused from performance in the event
of such contingencies arising, it is his duty to provide therefore in the contract.
NAGA TELEPHONE CO. V CA - ANSWERThe parties entered into a contract for the
use by NATELCO of CASURECO's electric light posts in Naga City. In consideration,
petitioners agreed to install, free of charge, 10 telephone connections for the use by
CASURECO. "That the term or period of this contract shall be as long as NATELCO has
need for the electric light posts of the party of CASURECO it being understood that this
contract shall be terminated when for any reason whatsoever, CASURECO is forced to
stop, abandon its operation as a public service and it becomes necessary to remove the
electric lightpost." CASURECO filed a petition for reformation of contract with the RTC
of Naga City on the ground that the agreement it entered into with NATELCO has
become one-sided, inequitous and disadvantageous to the former. The trial court ruled
in favor of CASURECO. The CA affirmed the trial court's decision but on a different
legal basis—Article 1267 of the Civil Code and ruling that the contract contains a purely
potestative prestation making that stipulation void. The Court affirmed the decision of
