Nature and Concept
An alternative obligation is an obligation where several prestations are due in such a way that complete performance of one of them is sufficient to extinguish the obligation. The debtor is bound to perform, not all the prestations, but one entire prestation from among the alternatives.
The obligation is single, although its object is multiple before choice. Once a valid choice is communicated, the obligation is concentrated on the selected prestation and is treated as an ordinary obligation to perform that prestation.
The Civil Code rule is that a person alternatively bound by different prestations must completely perform one of them, and the creditor cannot be compelled to receive part of one undertaking and part of another. This rule preserves the identity of each alternative and prevents the debtor from creating a mixed prestation that was not agreed upon.
Essential Characteristics
- Plurality of prestations. There must be two or more prestations capable of being selected as the mode of performance.
- Unity of obligation. The obligation remains one obligation, although several prestations are stated as possible objects before concentration.
- Disjunctive performance. Performance of one complete prestation extinguishes the entire obligation, unless the parties validly agree otherwise.
- Right of choice. One party is authorized to select which prestation will be performed, subject to the limits of law, stipulation, and the nature of the prestations.
- Concentration by communication. The selection produces legal effect only when communicated to the other party, after which the selected prestation becomes the sole object due.
Alternative, Cumulative, and Simple Obligations
An alternative obligation must be distinguished from a cumulative obligation. In a cumulative obligation, all prestations are due, so the debtor is released only by performing every prestation required. In an alternative obligation, only one prestation is ultimately due, although several prestations are contemplated before choice.
A simple obligation has only one prestation from the beginning. An alternative obligation becomes simple only after a valid choice is communicated or when only one prestation remains legally and physically practicable.
| Kind of obligation | Prestations stated | What must be performed | Effect of performing one prestation |
|---|---|---|---|
| Simple | One | The single prestation due | Extinguishes the obligation if complete and proper |
| Alternative | Two or more | One complete prestation selected from the alternatives | Extinguishes the obligation upon valid performance of the selected prestation |
| Cumulative | Two or more | All prestations required | Does not extinguish the obligation unless the parties agreed that partial performance is sufficient |
Right of Choice
The right of choice generally belongs to the debtor. This default rule follows the principle that the debtor is the party bound to perform and, unless the contract says otherwise, may choose which lawful and possible undertaking will satisfy the obligation.
The creditor has the right of choice only when it is expressly granted. A mere advantage to the creditor, an ambiguous clause, or the fact that the creditor prefers one prestation does not transfer the right of choice to the creditor.
The parties may regulate the manner, time, and form of choice, provided the stipulation is not contrary to law, morals, good customs, public order, or public policy. They may also make the choice dependent on a specified event or on the act of a third person, subject to the ordinary rules on contracts and obligations.
Limits on the Choice
The party entitled to choose cannot select a prestation that is impossible, unlawful, or incapable of being the object of the obligation. A void or impossible prestation is not a real alternative because it cannot validly satisfy the juridical tie.
If one of several alternatives was impossible or unlawful from the beginning, the choice is confined to the valid alternatives. If only one valid prestation exists, the obligation is treated as simple from the start. If all supposed alternatives are void, impossible, or outside commerce, there is no enforceable alternative obligation with respect to those prestations.
The choosing party must select one complete prestation. The debtor cannot require the creditor to accept a fragment of one alternative and a fragment of another, because that would substitute a new prestation for the one contemplated by the obligation.
A divisible prestation remains divisible only after it is validly selected and only according to the terms governing that selected prestation. Divisibility does not authorize the debtor to combine portions of different alternatives without the creditor's consent.
Communication of Choice
Choice has no legal effect until it is communicated to the other party. Communication is the act that converts the alternative obligation into a simple obligation focused on the selected prestation.
No special form is required for communication unless the law, the contract, or the nature of the prestation requires one. Communication may be written, oral, or implied from an unequivocal act, such as the complete tender of one alternative in a manner that clearly informs the other party of the selection.
The consent of the other party is not required for the choice to be effective. The choice is a unilateral act of the party who has the right to choose, but it must be made within the limits of the obligation and must be communicated before it can bind the other party.
Before communication, the choice generally does not bind the choosing party because the law gives it no effect. After communication, the choice becomes irrevocable without the consent of the other party, and the obligation is governed by the rules applicable to the selected prestation.
An invalid selection does not concentrate the obligation. If the choosing party selects a prestation that cannot legally or physically be chosen, the obligation remains alternative if other valid alternatives remain, and delay or damages may arise if the party refuses to make a valid choice when performance is due.
Effects When Choice Belongs to the Debtor
When the debtor has the right of choice, the creditor has no vested right to any specific alternative before concentration. The creditor is entitled to performance of one valid prestation, not to the preservation of every possible prestation as if each were separately due.
If all alternatives remain possible and lawful, the debtor may satisfy the obligation by completely performing any one of them. The creditor cannot reject a proper performance merely because another alternative would have been more valuable, more convenient, or more beneficial.
If only one alternative remains practicable, the debtor loses the right of choice and must perform the remaining prestation. The obligation is then concentrated by operation of law because choice has become meaningless.
If the creditor's acts prevent the debtor from making a choice according to the terms of the obligation, the debtor may seek rescission with damages. This remedy protects the debtor's legally recognized freedom of selection when the creditor wrongfully destroys, withholds, obstructs, or otherwise impairs the alternatives in a way that defeats the agreed mode of performance.
| Event before choice | Effect when debtor has the choice |
|---|---|
| One or some alternatives become impossible without debtor's fault | The debtor may choose among the remaining valid and practicable alternatives. |
| Only one alternative remains practicable | The obligation becomes simple, and the debtor must perform the remaining prestation. |
| All alternatives become impossible without debtor's fault and without delay | The obligation is extinguished under the general rules on loss or impossibility. |
| All alternatives become impossible through the debtor's fault | The creditor may recover damages, with indemnity generally based on the value of the last thing that disappeared or the service that last became impossible. |
| The creditor prevents choice according to the obligation | The debtor may seek rescission of the contract with damages. |
When all alternatives become impossible through the debtor's fault, the law uses the value of the last prestation that disappeared or became impossible as the basis of indemnity because that last remaining prestation would have been the object due after the others ceased to be practicable. Additional damages may be recovered when proven under the ordinary rules on civil liability.
If the debtor is already in delay, liability may arise even for a supervening fortuitous loss under the general rules on mora. Delay is especially material after the obligation has become due and the debtor unjustifiably refuses to choose or perform.
Effects When Choice Belongs to the Creditor
When the creditor has the right of choice, the obligation does not cease to be alternative until the creditor communicates the selection to the debtor. Before communication, the debtor remains bound to respect the creditor's power to select among the available alternatives.
The debtor's fault has more serious consequences when the creditor has the choice because the debtor's wrongful act may deprive the creditor of the very option expressly granted. The law therefore allows the creditor, in appropriate cases, to choose between remaining prestations and damages based on prestations lost through the debtor's fault.
| Event before creditor's choice | Creditor's right |
|---|---|
| One alternative is lost through fortuitous event | The creditor may choose from the remaining alternatives. |
| One alternative is lost through the debtor's fault | The creditor may choose any remaining alternative or demand the price of the lost alternative, with damages. |
| All alternatives are lost through the debtor's fault | The creditor may demand the price of any of the alternatives, with damages. |
| All alternatives are lost through fortuitous event and without debtor's delay | The obligation is extinguished because no prestation remains due. |
| Only one alternative remains through no fault of the debtor | The creditor's choice is practically confined to the remaining prestation. |
The same approach applies to obligations to do or not to do when one, some, or all of the alternative acts become impossible. If impossibility is attributable to the debtor, damages may replace the lost option; if impossibility is not attributable to the debtor and no delay exists, the remaining alternatives define the creditor's available choice.
After the creditor communicates the choice, the debtor must perform the selected prestation and can no longer discharge the obligation by offering another alternative. A later fortuitous loss, deterioration, breach, or delay is governed by the ordinary rules applicable to the selected prestation.
Loss, Impossibility, and Deterioration
Loss and impossibility are important in alternative obligations because they may reduce the range of possible performance before choice. The legal effect depends on who has the right of choice, whether the loss was due to fault, whether the debtor was in delay, and whether any practicable alternative remains.
For determinate things, loss means the thing perishes, goes out of commerce, or disappears in such a way that its existence is unknown or it cannot be recovered. For obligations to do, the equivalent inquiry is whether the service has become legally or physically impossible. For obligations not to do, liability usually arises from breach because the forbidden act, once done, may require undoing or damages.
Deterioration does not always eliminate an alternative, but it may affect the value and enforceability of the selected prestation. Once a deteriorated prestation is chosen, the general rules on obligations to give determine whether the creditor may demand rescission, fulfillment, price reduction, or damages, depending on fault and the terms of the obligation.
A fortuitous event ordinarily excuses the debtor only when the debtor is not in delay and has not assumed the risk. If the debtor is in delay, has promised the same thing to multiple persons with conflicting obligations, or has expressly assumed liability for fortuitous events, the ordinary rules on liability may still apply.
Performance After Concentration
Concentration occurs when a valid choice is communicated or when only one prestation remains legally and physically possible. From that point, the debtor must perform the selected or remaining prestation, and the other alternatives cease to be objects of the obligation.
After concentration, the creditor may demand exact performance of the selected prestation if legally possible. If the selected prestation is a determinate thing, the creditor may compel delivery and recover damages when proper. If the selected prestation is a service, the rules on obligations to do apply. If the selected prestation is an abstention, breach may require undoing what was done and payment of damages.
Payment or performance must correspond to the identity and integrity of the selected prestation. Tender of another former alternative is no longer proper performance unless the creditor consents, because the obligation has already ceased to be alternative.
If the parties agree after concentration to accept a different prestation, the result may be modification, novation, dation in payment, or another juridical arrangement depending on their intent and the circumstances. That later agreement is distinct from the original operation of the alternative obligation.
Facultative Obligations Distinguished
A facultative obligation is one where only one prestation is due, but the debtor is allowed to render another prestation in substitution. The substitute is not due before substitution, and the creditor cannot demand it unless the debtor validly makes the substitution.
The distinction matters because, in an alternative obligation, several prestations are contemplated as possible objects before choice; in a facultative obligation, only the principal prestation is the object due before substitution. The alternative obligation involves a choice among objects due in the alternative, while the facultative obligation involves a power to replace the object due.
| Point of comparison | Alternative obligation | Facultative obligation |
|---|---|---|
| Objects before choice or substitution | Several prestations are contemplated as possible objects of performance. | Only the principal prestation is due; the substitute is merely available for substitution. |
| Who may choose | The debtor chooses by default, unless the creditor is expressly given the choice. | The debtor generally holds the power to substitute, because substitution is a mode of performance granted to the debtor. |
| Creditor's demand | The creditor may demand performance according to the selected prestation after concentration. | The creditor may demand only the principal prestation before substitution. |
| Loss of one prestation before choice or substitution | The effect depends on fault, remaining alternatives, and who has the choice. | Loss of the substitute before substitution generally does not affect the obligation because the substitute is not yet due. |
| Loss of principal prestation before substitution | Not applicable as such because no single principal prestation exists before concentration. | If the principal prestation is lost without debtor's fault and before delay, the obligation is extinguished; if lost through debtor's fault, damages may be due. |
| Effect of valid selection or substitution | The selected alternative becomes the sole prestation due. | The substitute takes the place of the principal prestation once substitution is validly made. |
In a facultative obligation, loss or deterioration of the intended substitute through the debtor's negligence before substitution does not make the debtor liable under the obligation, because the substitute was not yet due. Once substitution has been made, the debtor is liable for loss of the substitute caused by delay, negligence, or fraud under the ordinary rules.
The creditor cannot defeat a valid facultative substitution merely because the principal prestation is preferred, provided the substitution is allowed by the obligation and is made in the proper manner. Conversely, the debtor cannot force substitution if the right to substitute was not granted or has been lost under the terms of the obligation.
Practical Legal Effects
The classification as alternative determines the object of demand, the effect of loss before performance, and the measure of damages when performance becomes impossible. It also determines whether the creditor may insist on a particular prestation or must accept any valid prestation chosen by the debtor.
Contract language controls the classification. Words such as "or," "either," and "at the option of" usually indicate an alternative obligation, while words such as "and" or clauses requiring several acts usually indicate a cumulative obligation. The whole contract must still be read to determine whether the parties intended one prestation to be due with a substitute or several prestations due in the alternative.
When the debtor has the choice, the creditor's protection lies in receiving one complete lawful prestation and in recovering damages if the debtor's fault makes all alternatives impossible. When the creditor has the choice, the creditor's protection is broader because the debtor's fault in destroying one option may already give the creditor a right to choose damages based on the lost option.
The central rule is that alternative obligations remain flexible only until lawful concentration. After concentration, the law enforces the selected prestation with the same seriousness as any other definite obligation.