- Statute
- Civil Code
- Article
- Art. 1381
- Topic
- Rescissible Contracts
- Status
- In force
- Book
- BOOK IV Obligations and Contracts
- Title
- TITLE II CONTRACTS
- Chapter
- CHAPTER 6 Rescissible Contracts
- Formerly
- Art. 1291a of the old Civil Code
- Year
- 1949
- Cited by
- Multiple Supreme Court decisions
The provision
The following contracts are rescissible: (1) Those which are entered into by guardians whenever the wards whom they represent suffer lesion by more than one-fourth of the value of the things which are the object thereof; (2) Those agreed upon in representation of absentees, if the latter suffer the lesion stated in the preceding number; (3) Those undertaken in fraud of creditors when the latter cannot in any other manner collect the claims due them; (4) Those which refer to things under litigation if they have been entered into by the defendant without the knowledge and approval of the litigants or of competent judicial authority; (5) All other contracts specially declared by law to be subject to rescission. (1291a)
Intellegal Wiki · In plain terms
Lists contracts that may be rescinded (undone): those by guardians or by representatives of absentees causing the ward or absentee a loss of more than one-fourth of the value; those made to defraud creditors who cannot otherwise collect; those over property under litigation made without the litigants' or court's approval; and any others the law specifically declares rescissible.
An editorially maintained plain-language explanation of this provision — not legal advice.
Intellegal Wiki · How the courts apply it
In Congregation of the Religious of the Virgin Mary And/Or the Superior General of the Religious of the Virgin Mary v. Emilio Q. Orola, the Supreme Court held: Affirmed the grant of specific performance with 6% interest, holding that the buyer's refusal to pay the balance despite transfer of title was a breach of reciprocal obligations governed by Article 1191 (not the Article 1381 rescission for economic prejudice), and that damages, including interest, are mandated under Article 1191 whether rescission or specific performance is chosen.
One leading Supreme Court case applying this provision.
Cases applying this article
- Vicelet Lalicon v. National Housing Authority G.R. No. 185440
- Heirs of Sofia Quirong v. Development Bank of the Philippines G.R. No. 173441
- Mondragon Personal Sales v. Victoriano S. Sola, Jr. G.R. No. 174882
- Congregation of the Religious of the Virgin Mary And/Or the Superior General of the Religious of the Virgin Mary v. Emilio Q. Orola G.R. No. 169790
- Alfonso L. Iringan v. Hon. Court of Appeals G.R. No. 129107
- Vicente I. Santos v. Intermediate Appellate Court G.R. No. 75384
- Luis Mirasol v. Maria Lim G.R. No. 39389
- Marcela Alvaran v. Bernardo Marquez G.R. No. 4465
Other Supreme Court decisions also apply this article.