Philippine Bar review · Question

Practice question: Compensation

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Practice question

Lio claims that a large, unproved damages demand automatically wipes out the liquidated debt Lio owes Mara. Explain the distinction between legal compensation and the judicial setoff contemplated by Article 1283.

Legal references

  • https://lawphil.net/statutes/repacts/ra1949/ra_386_1949.html — Civil Code, articles 1278–1290.

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