Compensation and confusion distinguished.
The differences are:
(1) In confusion, there is only one person who is a creditor and debtor of himself, while in
compensation, there are two persons involved, each of whom is a debtor and a creditor of the
other;
(2) In confusion, there is but one obligation, while in compensation, there are two obligations;
and
(3) In confusion, there is impossibility of payment, while in compensation, there is indirect
payment.
KINDS OF COMPENSATION
As to amount or extent:
1, Total – when the debts are of the same amount.
2. Partial- when the debts are of different amounts.
As to cause or origin:
1. Legal – one that takes place by operation of law.
2. Voluntary or conventional- one that take place by the agreement of the parties.
3. Judicial- one that is ordered by the court.
4. Facultative – one that may be claimed or opposed by one of the parties.