4.

CONFUSION/MERGER (3) OBLIGATIONS MAY BE MODIFIED BY:

- meeting in 1 person of qualities of debtor & creditor w/ same 1. Changing object/principal conditions. (REAL NOVATION)
obligation 2. Changing the person of debtor/creditor. (PERSONAL
NOVATION)
3 REQUISITES OF VALID CONFUSION/MERGER a. Substitution change of debtor
1. The merger of characters of debtor & creditor must be in same b. Subrogation change of creditor
person. 3. Changing person of the parties & the objects of principal
2. Take place between principal debtor & creditor. condition. (MIXED NOVATION)
3. Clear& definite.
4 REQUISITES OF NOVATION
5. COMPENSATION 1. Old valid obligation.
- 2 persons are debtors & creditors of each other 2. Agreement of parties to new obligation.
3. Extinguishment of old obligation.
6 ESSENTIAL REQUISITES OF COMPENSATION 4. Validity of new obligation.
1. Parties both principal debtors & creditors of each other.
2. Compensation is not prohibited by law. 2 FORMS OF NOVATION BY SUBSTITUTION OF DEBTOR
3. No retention/controversy by 3rd person. 1. EXPROMISION w/ consent of creditor, NO consent of old
4. 2 debts are due & demandable. debtor
5. 2 debts are liquidated. 2REQUISITES
6. 2 debts both in money/consumable things. a. Initiative of 3rd person.
b. Consent of creditor.
(2) CLASSES OF COMPENSATION 2. DELEGACION all must agree (creditor, old debtor, new debtor)
1. As to effect 3REQUISITES
a. TOTAL obligations completely extinguished. a. Initiative from old debtor.
b. PARTIAL a balance remains b. Consent of debtor.
c. Acceptance by creditor.
2. As to origin or cause
a. LEGAL by law 7. SUBROGATION
b. VOLUNTARY/CONVENTIONAL agreement of parties - change of creditor
c. JUDICIAL order from the court
d. FACULTATIVE 1 of parties can choose/oppose claiming 2 KINDS OF SUBROGATION
compensation 1. CONVENTIONAL consent of original parties & 3rd person
2. LEGAL by law
6. NOVATION a. creditor pays another preferred creditor even w/o debtors
- substitution/change of obligation knowledge
- substitution of debtor b. 3rd person pays the express approval of debtor
- subrogation of creditor c. 3rd person pays even w/o knowledge of debtor