Chapter 4 section 4 flas card

What is confusion or merger?

When the debtor and creditor become the same person, extinguishing the obligation

What are the requisites of confusion?

Same person is debtor and creditor, same obligation, complete merger

What is compensation?

When two persons owe each other and their debts cancel out

Difference between compensation and confusion?

Compensation: two persons owe each other

Confusion: one person is both debtor and creditor

What are the kinds of compensation?

Legal, Conventional, Judicial, Facultative

When is compensation legal?

When all legal requirements are present automatically

Requisites of legal compensation?

Parties are principal debtors/creditors, debts are same kind, due, liquidated, no dispute

What is a liquidated debt?

A debt with a fixed or known amount

What is conventional compensation?

Compensation agreed by both parties

What is judicial compensation?

Compensation ordered by the court

What is facultative compensation?

Compensation that can be claimed by one party only

What is assignment of rights?

Transfer of credit to another person

Effect of assignment on compensation?

May stop compensation if debtor is notified

Debts that cannot be compensated?

Deposit, commodatum, support, civil liability from crime

What is commodatum?

Loan of a thing that must be returned (not consumable)

What is novation?

Replacing an old obligation with a new one

What is the consideration in novation?

The new obligation replacing the old one

Is form required in novation?

No, but it must be clear

Is novation presumed?

No, it must be clearly stated or implied

Kinds of novation?

Objective, Subjective, Mixed

What is objective novation?

Change in object or conditions

What is subjective novation?

Change in parties

What is substitution?

Changing the debtor

Kinds of substitution?

Expromision and Delegacion

What is expromision?

Third person replaces debtor without debtor’s consent

What is delegacion?

Debtor proposes new debtor with creditor’s approval

Who are involved in delegacion?

Delegante (old debtor), Delegado (new debtor), Delegatario (creditor)

Effect of novation on accessory obligations?

Extinguished unless preserved

What if new obligation is void?

Old obligation remains

What if old obligation is void?

No novation happens

What is subrogation?

Replacing the creditor with another person

Kinds of subrogation?

Legal and Conventional

What is legal subrogation?

Happens by law

What is conventional subrogation?

Agreed by parties

Difference between subrogation and assignment?

Subrogation transfers rights + accessories

Assignment transfers credit onl