Page 31 - Obligations & Contracts Module 1-2

*Requisites for Valid Payment/Performance

*Payment made “to an Incapacitated Person”, Valid If:

1. Incapacitated person kept the thing delivered, or

2. Insofar as the payment has been beneficial to him

*Payment to a “3rd Party Not Authorized”, Valid If Proved & Only

to the Extent Of Benefit; Presumed If:

1. After payment, 3rd person acquires the creditor’s rights

2. Creditor ratifies payment to 3rd person

3. By creditor’s conduct, debtor has been led to make the payment (estoppel)

*Payment made in “Good Faith” to a Person in Possession

of Credit Shall Release Debtor, Requisites:

1. Payment by debtor must be made in good faith

2. Creditor must be in possession of the credit & not merely the evidence of indebtedness

C. With respect to time, place of payment - must be according to the obligation

*Where payment should be made:

1. In the place designated in the obligation

2. If there is no express stipulation and the undertaking is to deliver a specific thing – at the

place where the thing might be at the moment the obligation was constituted

3. In other case – in the place of the domicile of the debtor