Cause and objects of contracts

what is the cause part of the contract

• the motive as to why a a party obligates himself or herself.

• No obligation can exist without a lawful cause. Art 1966.

how can a cause of action fail in a contract

If an obligation had a cause at its inception, the other party was aware of that cause, and the cause has since become moot,

what happens when a cause of an obligation was illegal or against public policy

the obligation is unenforceable, but on grounds that cause is absent

what is the recovering under cause?

Recovery may be limited to the expenses incurred or the damages suffered as a result of the promisee's reliance on the promise. Reliance on a gratuitous promise made without required formalities is not reasonable.

what are the types of GRATUITIOUS CONTRACTS

•  a loan for use (Art 2891 & ff),

•  a loan for consumption (Art 2904 & ff),

•  a deposit (Art 2926 & ff),

• a mandate (Art 2989),

•  and suretyship (Art 3035).

what is a loan for use (Art 2891 & ff)

a loan for use Borrower's Obligations

• is obligated to keep and preserve the thing lent carefully -- as a "prudent administrator,"

• Failure to  return on time or missuses it

  • the borrower is liable for any damage to the thing, even if it is caused by a fortuitous event

  • only liable if he could have reasonable protected the thing

a loan for use Lenders' Obligations/rights

• is liable to the borrower when defects in the thing lent cause damage or loss to the borrower

• Right to demand the return of thing after the expiration of the term, or unforeseen need

what is a loan for consumption (Art 2904 & ff),

• is a contract by which a person, the lender, delivers consumable things to another,

• The borrower in a loan for consumption becomes owner of the thing lent and bears the risk of loss of the thing

• unless the loan for consumption is  interest-bearing, it is gratuitous in nature.

what if the for consumption is money

•  the borrower is bound to repay the same numerical amount regardless of fluctuation in the value of the currency.

loan for consumption Borrower's Obligations/rights

• Unable to return things of  the same quantity and quality as those lent, the borrower is bound to pay the value of the things lent.

• not return the things lent or their value at the time due, then he is bound to pay legal interest from the date of written demand. Arts 2910-2912

loan for consumption Lenders' Obligations/rights

• the lender is liable to the borrower when defects in the thing lent

•  the lender may not demand that  the borrower perform (return an equivalent thing)  before the expiration of the term.

what is a deposit (Art 2926 & ff)

•  contract by which a person, the depositor (usually the owner of the thing), delivers a movable thing to another person, the depositary , for safekeeping under the obligation of returning it to the depositor upon demand.

• may be either onerous or gratuitous

what are the Depositary Obligations:

• duty to care for the thing with diligence and prudence,

• Duty to  return the precise thing that he received in deposit.

•  may not use the thing deposited without the express or implied permission

what are the Depositary  rights :

may retain the thing deposited until his claims arising from the contract of deposit are paid.

how does an innkeeper act as a Depositary

• innkeeper is obligated to accept guests' personal belongings for deposit unless unable to provide such a service

• May place safe in guest's room

what are the stipulations of an innkeeper and safe

• Not liable as a depositary for things put in the safe  EXPECT:

  •  unless the loss  of goods placed in the safe is attributed to his fault.

  • If items are not placed in the safe = strictly liable for theft or loss limited $500

what is a mandate (Art 2989)

contract by which a person, the principal, confers authority on another person, the mandatary, to transact one or more affairs for the principal.

conditionals of a mandate

•  need no have any particular form -- unless the law prescribes

• may be either onerous or gratuitous

what is suretyship (Art 3035).

•  is an accessory contract by which a person (a suretor) binds himself to a creditor to fulfill the obligation of another if the original debtor fails to do so.

• terms 'guarantor', co-signer, and 'co-maker' are often used instead of the term "suretor."

in general was is Gratuitous Donations:

• only way that property (whether movable or immovable) can be transferred gratuitously is by donation. Art 1467.

• Donations can be either mortis causa or inter vivos

what is a mortis causa donation 

• is an act to take effect at the death of the donor by which he disposes of the whole or a part of his property

• is revocable during the lifetime of the donor.

what is an inter vivos donation

is a contract by which a person, called the donor, gratuitously divests himself, at present and irrevocably, of the thing given in favor of another, called the donee, who accepts it.

what is needed for giving and receiving Donations

• must have capacity at the time of donation

• NO fraud, duress, or undue influence:

when is a donation considered null

• proof of fraud, duress, or undue influence

what is an onerous donation

• inter vivos do not apply to a donation

• "a donation that is burdened with an obligation imposed on the donee that results in a material advantage to the donor." Art. 1526.

what is an Remunerative donation

• inter vivos do not apply to a donation

• "a donation that is made to recompense for services rendered that are susceptible of being measured in money." Art 1527

• think about a donation of something for a past service

what is the required form for donations:

shall be made by authentic act under the penalty of absolute nullity, unless otherwise expressly permitted by law.

Articles 1526 and 1527 provide that no authentic act is required unless at the time of the donation

• the cost of performing the obligation is less than two-thirds of the value of the thing donated"

• the value of the services rendered is less than two-thirds of the value of the thing donated."

what must the donations authentic act define

shall identify the donor and the donee and describe the thing donated.

when is a donation effective?

• upon acceptance must be in writing, as with the donation of an immovable,

• Acceptance need not be in authentic act form. But donation needs to be

what is corporeal donation 

a moveable thing that can be manually donated: the donor simply delivers it to the donee coupled with donative intent.  Art. 1543.

what is an incorporeal donation

• is evidenced by a certificate, document, instrument, or other writing, and that is transferable by endorsement or delivery

•  Completion of the transfer to the donee or his account or for his benefit shall constitute acceptance of the donation.

what are the special circumstances in which a donation may be revoked or dissolved

• ingratitude of the donee

• dissolved for the nonfulfillment

• dissolved for the nonperformance of other conditions or charges.

how can a donation be Revocation for ingratitude:

1. If the donee has attempted to take the life of the donor; or

2. if he has been guilty towards him of cruel treatment, crimes, or grievous injuries.

what is the prescription of parties for the Revocation for ingratitude

shall be brought within one year from the day the donor knew or should have known of the act of ingratitude.

Art. 1564. Dissolution for non-execution of other condition; prescription

An action to dissolve a donation for failure to fulfill the conditions or perform the charges imposed on the donee prescribes in five years,

what 3 things must be met for an object to be the object of a contract:

1. lawful

2. possible 

3. determined or determinable 

what do lawful objects do

do not violate laws or go against public policy.

Possible or impossible object Art. 1972.

A contractual object is possible or impossible according to its own nature and not according to the parties' ability to perform.

Art. 1973. Object determined as to kind.

• objects are conditional upon parties agreeing on the "kind" of object and the "quantity" of that object. 

• Kind pertains to the notion that the parties have at least agreed upon a group or a service that share common traits or characteristics.

Art. 1975. Output or requirements

• The quantity of a contractual object may be determined by the output of one party or the requirements of the other.

• In such a case, output or requirements must be measured in good faith.

Art. 1976. Future things.

• Future things may be the object of a contract.

• Examples of future things include a farmer selling his future crop; a painter selling a painting he'll do next year

Art. 1977. Obligation or performance by a third person( Promesse de Porte-Fort)

• is a contract where the object of the contract is an obligation or performance to be done by a third party.

• the original promisor is liable in damages to the promisee if the third person does not bind himself or fails to perform.

what is natural obliagation

• obligation arises from circumstances where the law implies a particular moral duty, but that moral duty is not legally enforceable.

two instances where a natural obligation has legal consequences, ( in Article 1761)

1. whatever has been freely performed in compliance may not be reclaimed

2.  the moral duty,  can serve as the cause of a contract made for its performance

What are the simplified 5 elements for moral duty = cause of contract

1. duty is towards a particular person

2. Strong conscience

3. involving the payment of money or one that is normally paid-for.

4. Objective recognition-- "clear and unequivocal

not be against public policy

what is a comprises

"is a contract whereby the parties, through concessions made by. one or more of them, settle a dispute or an uncertainty concerning an obligation or other legal relationship." Art. 3071.

for a comprise to be  enforceable, it must :

1.  be in writing or

2.  recited in open court (where it can be transcribed from the record of the proceedings)

what are the conditions must be fulfilled for there to be a compromise:

1. Existence of litigation

2. The intention of putting an end to the lawsuit.

3. Reciprocal concessions of the parties

what is a third party beneficiary

generally a clause in a contract therefore the contract must be a validly formed contract.

what are the stipulations of a third party beneficiary

•  the third party is not a party to the contract. Only benefits from it

• only by the stipulator and only before the third party has manifested his intention

• CANNOT be provoked after third party benfits

when does a remission of debt occur

• when a creditor forgives a debt, thus it extinguishes the obligation.  Art 1888.

when is remission of debt effective

when the obligor receives the communication from the obligee, and acceptance of a remission is always presumed unless the obligor rejects it within a reasonable time.

what is the form of cause for remission of debt

• often indirect liberality

• the  creditor want to give a benefit to his debtor without obtaining an advantage in return.

• it is not subject to the authentic act requirement for a donation,