Short answer. You have two options, not one. Article 2041 of the Civil Code gives you the right to either enforce the compromise as written, or treat it as rescinded and revive your original claim. The choice is yours — you are not required to simply accept the breach.
What the law says
If one of the parties fails or refuses to abide by the compromise, the other party may either enforce the compromise or regard it as rescinded and insist upon his original demand.
Civil Code, Article 2041 — Breach of Compromise. Read the full provision →
What Article 2041 gives you when the other side defaults
A compromise agreement is a contract, and when the other party refuses to honour it, you are not simply stuck. Article 2041 of the Civil Code gives the non-defaulting party a clear choice: either enforce the compromise or regard it as rescinded and insist upon his original demand. This election belongs to you. You can hold the other party to what they agreed, or you can treat the compromise as cancelled and go back to the dispute as if the settlement had never happened.
Option one: enforce the compromise
If you choose to enforce the compromise, you are asserting the settlement agreement itself as your cause of action. You would file a suit to compel specific performance of what was agreed — payment of the amount, delivery of the property, or whatever your settlement required. If the compromise was made the subject of a court judgment (a judgment on compromise), enforcement is even more direct: a motion for execution in the same case. The advantage of this path is that the terms are already defined and agreed to, which simplifies what needs to be proven.
Option two: rescind and revive the original claim
Alternatively, you may regard the compromise as rescinded and go back to your original demand. This is available when the other party's breach makes it impractical or undesirable to enforce the settlement terms, or when you believe your original claim is worth more than what was settled. Rescission of the compromise returns both parties to their positions before the settlement — the original controversy reopens. This can be the better choice if, for example, you settled under pressure and later discovered the breach reveals the other party never intended to comply.
Which option to choose, and what to consider
The decision depends on what you want and what can realistically be achieved. Enforcing the compromise is generally faster if the terms are clear and quantifiable. Rescinding and reviving your original claim makes sense if the original dispute was stronger than the settlement amount, or if the breach reveals a pattern that affects how a court would view the other party's credibility. You cannot, however, take both paths at the same time — the choice, once made, determines the direction of your case. If the situation is complicated by partial compliance or disputed facts about the breach, clarifying your options with a lawyer first is advisable.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Reynaldo Inutan, et al. vs. Napar Contracting & Allied Services, G.R. No. 195654, November 25, 2015 — read the decision on LawPhil →
- Crisanta Alcaraz Miguel vs. Jerry D. Montanez, G.R. No. 191336, January 25, 2012 — read the decision on LawPhil →
- Conchita A. Sonley vs. Anchor Savings Bank/Equicom Savings Bank, G.R. No. 205623, August 10, 2016 — read the decision on LawPhil →
- Estate of Salud Jimenez vs. Philippine Export Processing Zone, G.R. No. 137285, January 16, 2001 — read the decision on LawPhil →