Article 1232: What Payment Means

Article 1232. Payment means not only the delivery of money but also the performance, in any other manner, of an obligation.

The term "payment" does not only refer to the delivery of money. Under this section of the Civil Code, "payment" as a term of art in Obligation and Contracts also refers to the performance, in any other manner, of an obligation.

Therefore, in order to extinguish an obligation by payment, one may (1) delivery money or (2) perform, in any other manner, the obligation.

Why pay?

Payment is made only because of or is grounded on an existing obligation to pay. The obligation may arise from law, like in the case of taxes. It may arise from contracts, like in the case of contracts of loan, mortgage or pledge. It may arise from quasi-contracts, like in the case of solutio indebiti. It may arise from delicts or even quasi-delicts, like in the case of murder where the convict is ordered to pay Php 50,000.What if the creditor rejects payment?

Well, the creditor does have the right to reject payment in cases when there are valid reasons. Acceptance, however, may be in the form of an express or tacit acceptance.

A paid B for the something. It turned out, however, that that something being the object of the obligation has rendered the obligation null and void. What happens to the payment?

The payment is also null and void.

A paid B the amount of $100 days after the obligation to pay already prescribed without knowing that it already did. May A recollect the payment from B?

Yes, for this is a case of unjust enrichment at the expense of another.

A paid B the amount of $100 days after the obligation to pay already prescribed knowing fully well that it had already prescribed. May A still demand the return of the $100 payment?

Not anymore, no. This is a case of natural obligation.