Abstract
<jats:title>Abstract</jats:title> <jats:p>This chapter discusses that Philippine contract law subscribes to the principles of mutuality and obligatory force but also allows for judicial intervention in cases of change of circumstances, based on equity and good faith. It differentiates situations where supervening events or changes of circumstances result in impossibility of performance and where such change only results in difficulty of performance. It delves into the relevant provisions of the Philippine Civil Code and explores the scope, elements, and judicial handling of these provisions. It looks into the probable treatment of various hypothetical situations involving changes of circumstances. It observes that the Civil Code tends to show a bias for the principle that there should ideally be a balance between prestations such that when equilibrium is lost, justice and equity demand the chance for judicial relief. It emphasizes the role of equity jurisdiction, which empowers courts to allocate rights of contracting parties under narrowly specified scenarios involving a change in circumstances. Since Philippine contract law remains codified and fundamentally rooted in the civil law tradition, the chapter concludes that a balance must be struck between statutory law and equity while, at the same time, cautioning against over-reliance on equity jurisdiction, which can undermine contractual stability.</jats:p>