OBLICON: Rules in Case of Loss, Deterioration or Improvement of Determinate Thing

Requisites of Application of Article 1189

1. The obligation is a real obligation.

2. The object is a specific or determinate thing

3. The obligation is subject to suspensive condition

4. The condition is fulfilled.

5. There is loss, deterioration, or improvement of the thing during the pendency of the condition.

Article 1189

When the conditions have been imposed with intention of suspending the efficacy of an obligation to give, the following rules shall be observed in case of improvement, loss or deterioration of the thing during the pendency of the condition.

Lost without the fault of the debtor

The obligation shall be extinguished.

Lost through the fault of the debtor

The debtor shall be obliged to pay damages when the thing is lost when it perishes, goes out of commerce, or disappears in such a way that its existence is unknown or it cannot be recoevered.

Physical Loss

Perishes when a house is burned and reduced to ashes.

Legal Loss

When a thing goes out of commerce or when a thing legal becomes illegal.

Civil Loss

When a thing disappears in such a way that its existence is unknown.

Deteriorates without the fault of the debtor

Impairment is to be borne by the creditor

Deteriorates through the fault of the debtor

The creditor may choose to rescission of the obligation and its fulfillment or indemnity of damages.

Improved by its nature or by time

The improvement shall inure to the benefit of the creditor.

Improved at the expense of the debtor

He shall have no other right than that granted to the usufructuary.

Usufruct

The right to enjoy the use and fruits of a thing belonging to another.