Extinguishment of Obligations

1. The Ralph owes Oliver several debts, all of them due, to wit: (1) an unsecured debt; (2) a debt secured with a mortgage of Ralph's house; (3) a debt bearing interest; (4) a debt in which the debtor is solidarily liable with his cousin, Mark. Partial payment was made by the Ralph. Assuming that Ralph had not specified the debts to which the payment should be applied and, on the other hand, Oliver had not specified in the receipt he issued the application of payment, state the order in which the payment should be applied and your reasons therefore.

2. Suppose that under an obligation imposed by a final judgment, the liability of Michelle is ordered to pay the amount of P1,000,000.00 but both the her and Nora, the judgment creditor, later entered into a contract reducing the liability of the former to only P800,000.00. Is implied novation present in this case? Explain your answer.

3. Mr. Sy, who has a savings deposit with Bangko de Dada in the sum of P1,000,000.00 incurs a loan obligation with the said Bank in the sum of P800.000.00 which has become due. When Mr. Sy tries to withdraw his deposit, Bangko de Dada allows only P200.000.00 to be withdrawn, less service charges, claiming that compensation has extinguished its obligation under the savings account to the concurrent amount of Mr. Sy's debt. Mr. Sy contends that compensation is improper when one of the debts, as here, arises from a contract of deposit. Is Mr. Sy correct?

4. Kent agreed to deliver 20 sacks of marijuana to Betong. Later on, Kent and Betong had a meeting and they agreed that instead of Kent delivering the sacks of marijuana to Betong, Kent would just deliver a pickup truck. Was there a valid novation of obligation? Explain your answer.