What are quasi contracts? (Art. 1157, Civil Code, Nature and Effect of Obligations)

Summary

In this video, Attorney Marty Chris Baton Lasko explains the concept of quasi-contracts, focusing on their two main types: unauthorized management (negotiatorium gestorum) and undue payment (solutio indebiti). Quasi-contracts arise when one party benefits from the actions of another, even without a formal agreement. The video highlights the principle of preventing unjust enrichment and uses practical examples like a neighbor saving belongings from a burning house or paying the wrong person. The Supreme Court case of BPI vs. Sarmiento is also discussed, clarifying the conditions under which a quasi-contract is valid.

Takeaways

• 😀 Quasi contracts are juridical relations arising from lawful, voluntary, and unilateral acts, where parties become bound to each other.
• 😀 The principle behind quasi contracts is to prevent unjust enrichment at the expense of another person.
• 😀 There are two types of quasi contracts: 'negotiatorium gestio' (unauthorized management) and 'solutio indebiti' (undue payment).
• 😀 'Negotiatorium gestio' occurs when one person takes charge of another’s property or business without authority, but the other person benefits from it and must compensate for the act.
• 😀 A common example of 'negotiatorium gestio' is when a neighbor saves belongings from a house on fire without permission from the owner. The neighbor must be compensated for the help provided.
• 😀 'Solutio indebiti' arises when a person mistakenly delivers something to another who has no right to receive it, creating an obligation to return the item.
• 😀 An example of 'solutio indebiti' is when person A mistakenly pays person C instead of person B, creating a duty for C to return the payment.
• 😀 A quasi contract is not applicable if there is a pre-existing contractual relationship between the parties.
• 😀 In the case of 'BPI vs. Sarmiento', the Supreme Court ruled that Sarmiento did not need to return his salary because there was a pre-existing employer-employee contract, not a quasi contract.
• 😀 For a quasi contract to exist, two conditions must be met: no pre-existing contract between the parties and the payment must be made through a mistake.

Q & A

What is the main focus of this video channel?

The main focus of the channel is to simplify legal concepts and principles, explaining them in under 10 minutes.

What are quasi contracts?

Quasi contracts are juridical relations that arise from lawful, voluntary, and unilateral acts, where one person benefits from another's actions, and the law creates a legal tie requiring compensation.

What is the principle behind quasi contracts?

The principle behind quasi contracts is that no one should be unjustly enriched at the expense of another.

What are the two types of quasi contracts mentioned in the video?

The two types of quasi contracts are 'negotiatorium gestio' (unauthorized management) and 'solutio indebiti' (undue payment).

Can you explain the concept of 'negotiatorium gestio'?

'Negotiatorium gestio' refers to the situation where one person manages the property or business of another without authorization, but benefits the owner, who is then obligated to compensate the person who took charge.

What is an example of 'negotiatorium gestio'?

An example is when a person leaves their house unattended, and a neighbor helps save their belongings when the house catches fire. Although the neighbor had no authority to manage the house, they helped and are entitled to compensation for their efforts.

What is 'solutio indebiti' and how does it work?

'Solutio indebiti' occurs when one person mistakenly pays or delivers something to another who has no right to it. The recipient is obligated to return the item or money to the payer, as the payment was made by mistake.

What are the requisites for 'solutio indebiti' to exist?

The requisites for 'solutio indebiti' are: (1) there must be no pre-existing contractual relationship between the payer and the recipient, and (2) the payment must have been made by mistake, not out of generosity or other reasons.

What was the Supreme Court's ruling in the case of 'BPI vs. Sarmiento'?

In the case of 'BPI vs. Sarmiento', the Supreme Court ruled that Sarmiento was not obligated to return the salary he received during his preventive suspension because there was a pre-existing employer-employee relationship, and the salary was not paid by mistake.

Why is it important to determine if there is a pre-existing contractual relation in quasi-contracts?

It is important because if there is a pre-existing contractual relation, the obligation arises from the contract itself, not from a quasi-contract. This distinction helps to identify whether the situation involves a quasi-contract or a contractual obligation.