Chapter 5: The Legal Aspects of Credit and Collection: Adapon, Maria Alicia Castillo, Peter F3C Fincredi

CHAPTER 5: THE LEGAL
ASPECTS OF CREDIT AND

COLLECTION
Adapon, Maria Alicia

Castillo, Peter
F3C FINCREDI
RATIONALE IN PURSUING LEGAL COLLECTION
EFFORTS:
1. It is the necessary and logical thing to do;

2. To serve as leverage against the debtor;
3. You are a necessary party to the case;
4. As a mode of redress;
5. As a dilatory tactic;
6. Avoidance or mitigation of liability;
7. As a negative reinforcement to a collection
effort.
GENERAL PROBLEMS AFFECTING LEGAL
COLLECTION EFFORTS
1. Absence or lack of actionable

documents – endeavor to get the debtor to
acknowledge his obligation in writing,
either by letter, note and the like.
Debt repayment agreement/payment
contract – a collection tool which is an
agreement between the creditor and the
debtor, the latter acknowledging his debt to
the creditor without the need for any proof
about the obligation.
COLLECTION EFFORTS
2. Insufficient documents – try to complete

or submit secondary evidence.
3. Signed by an Attorney-In-Fact – endeavor
to check with the principal and the notary
public about the validity and genuineness of
their signitures.
4. Unregistered document – “Register” the
documents as soon as possible.
COLLECTION EFFORTS
5. Unnotarized document – have the document

“notarized”. If there are two parties on the
documents, signing in different places, have the
documents notarized at both places.
6. Unknown debtor or co-debtor’s whereabouts –
check thru a good credit investigation, or security
agency and/or your own people.
7. Summons cannot be served – try the submitted
service method of serving the summons by
publishing the summon in a newspaper of general
circulation.
COLLECTION EFFORTS
8. Debtor’s properties are encumbered or

disposed – endeavor to check all the liens,
encumbrances. Conduct an inspection and appraisal
of properties found to determine whether or not their
mortgage values are small or way below their market
values – preparatory to whether or not you may want
to take over any of the encumbered properties in
partial satisfaction of your money claim also look at
for properties sold to third parties after notice of
demand to pay is made against debtor.
COLLECTION EFFORTS
9. Debtor have filed for voluntary

insolvency and/or suspension of payment –
check with the court or SEC if it is a
corporation, partnership or single
proprietorship about the case and file a claim
soonest with the court and/or receiver
appointed where the petition for insolvency
was filed.
COLLECTION EFFORTS
10 . Debtor’s business have been assigned/

transferred or taken over by a new
company – file for violation of the provisions
of the Bulk Sales Law Act 3952 as amended
by R.A. 111, with a prayer for preliminary
attachment against any remaining assets
and/or the ones transferred or assigned.
THE LEGAL COLLECTION PROCESS
1. Sending of proper demands to the party –

obligor – debtor(s)
2. Gathering, preparation and review of
actionable documents; and credible,
competent witnesses
3. Complaint preparation
a. Review of the theory of the case with the
attorney
b. Matching documents and evidence with
available credible and competent witnesses
c. Verification/notarization
4. Filing of the case

A. Check that the correct filing fees are paid
B. Follow-up with branch clerk of court for the
expeditious issuance of summons and expeditious
service of the same by the court process server or by
special sheriff in applicable cases.
C. If need be, serve through your own representative
and request court process server to make the return.
D. If the summon cannot be served by the process
server of the court, file a motion to allow the service
of the summon by a special sheriff which maybe
another reliable sheriff or your own representative.
5. Service of Summons
a. Check that the “correct” sheriff’s fees are paid;
b. By ordinary service of the court process server;
c. Special sheriff may be the creditor’s representative
duly appointed upon proper motion by the court.
6. Reply of the Parties to the Case: Grounds for delay:
a. Motion to dismiss is either on the following ground:
(1) No cause of action
(2) Prior payment
(3) Venue is in issue
(4) Wrong party
b. Motion for bills of particulars (for

documents)
c. Motion for discovery/deposition for
evidence and witnesses needed in the
expeditious resolution of the case – this is
one legal way provided by the law but is
seldom availed of by the attorneys to a case
for a lack of appreciation, practice and
apparent ignorance of its mechanics by
practicing attorneys;
d. Motion for extension of time to file an

answer either due to the absence of the
lawyer, sickness, absence of the proper party,
other plausible reasons;
e. Other legitimate/dilatory tactics.
PRE-TRIAL REQUIREMENTS
The pre-trial seeks to solve any or all of the

following:
1. Possibility for an amicable settlement or for a
submission to arbitration/mediation;
2. Simplification of the issues of the case;
3. The necessity or desirability of amendments
to the pleadings by either party;
4. Possibility of obtaining stipulation or
admission of facts and of supporting
documents to avoid unnecessary proof;
PRE-TRIAL REQUIREMENTS
5. Limitation of the number of witnesses;

6. Advisability of a preliminary reference of
the issue to a commissioner’s office;
7. The propriety of rendering judgements on
the pleadings, or summary judgements, or of
dismissing the action should a valid ground
therefor be found to exist;
8. Other matters that may aid in the prompt
disposition of the case.
LEGAL AND EXTRA -LEGAL TECHNIQUES
TO SHORTEN COURT LITIGATION
Among the techniques provided by the Rules of
Court are the following:
A. Discovery
Discovery is the closure of facts, deeds,
documents and other information that are in the
exclusive possession or knowledge of a party or
witnesses; and which are necessary to the party
seeking the discovery as a part of a cause of
action pending or to be brought in the court or as
evidence of his rights or title in such
proceedings.
Modes of Discovery
1. Deposition – the written testimony of a
witness given in the course of judicial
proceedings in advance of a trial or
hearing upon oral examination, or in
response to written interrogations or
questions by the other party, and where an
opportunity for cross examination is given.
Depositions are generally taken due to the

following:
a. Impending departure of the deponent from
the country;
b. Certain facts and information cannot be
obtained except by deposition;
c. Due to the age, infirmity of the witness;
d. Witness (deponent) resides in a remote
place from the place of the hearing or trial.
2. Interrogatories to Parties – are not part of a
pleading of the case unlike deposition. They are
merely forms of examinations prior to a trial or
hearing of a case.
3. Admission by the Adverse Party – is generally
availed of after the plaintiff and the defendant have
filed their pleadings. It is the request by one party
to the other party for the admission of the
genuineness of any relevant document described
in and exhibited with the request or of the truth of
any relevant matter of fact set forth in the request.
4. Production or Inspection of Documents or
Things – upon prior motion and permission by the
court, any party to a case may request the court to
order the other party to allow inspection or
production of any document or things for
examination, photography and the like, as well as to
allow the entry of the requesting party into a property
to inspect, survey, measure and the like.
5. Physical and mental examination of person – in
an action where the physical or mental condition of a
party is in question, the court may, at its distraction,
order a physical and mental examination by a
competent physician.
B. Summary Judgement
Summary Judgement is a court decision upon
a claim, counter claim or cross claim or upon a
declaratory relief, granted anytime after the
pleading in response thereto has been served.
C. Judgement on the Pleadings – where the
debtor/defendant admits all the material allegations
in the creditor/plaintiff’s complaint and there is no
issue or point of disagreement between them,
except payment.
D. Judgement on Demurrer to Evidence – it is the remedy
availed of by the defendant after the plaintiff has completed
the presentation of his evidence.
E. Alternative Dispute Resolution in Court – the past
Congress of 2003 passed Republic Act 9285 otherwise known
as Alternative Dispute Resolution Act. The principal objectives
are:
1. Reducing the dockets of the court
2. Faster resolution conflicts
3. Mitigating time, expense of the parties, attorneys and
judicial officers
4. Reduce graft and corruption attendant to delayed
resolutions of civil disputes;
5. More acceptable and lasting settlemet.
Rationale of Mediation
 Avoid adversarial procedures in resolving conflicts;
 Reduce cost of conflicts in time, money and effort;
 Continuity of relationship;
 Have expeditious, mutually acceptable, lasting
agreement to resolve issues between parties;
 To improve communication;
 To have positive healthy change and avoidance of
retrogression;
 For the parties involved, to understand and be
responsible for acts, needs and in making choices.
Reasons for Lack of Appreciation of the
Mediation Process:
 The culture of Filipinos is adversarial in nature;
 Mediation is a newly copied paradigm in business -
conflict resolution;
 Apparent lack of understanding about the benefits
to be derived from mediation;
 Apparent and obvious bias of “supposed” neutral,
independent, disinterested parties to the process;
 Resistance from attorneys who feel threatened by
the fear of losing control, credibility and income;
 The unskillful, artless conciliation process of the
assigned mediator.
F. Amicable or Compromise Agreement
1. Rationale or Motivation – it is effectively easier
to get a decision against a debtor/defendant than
by pursuing a litigation on the case in court.
2. Tactics to Motivate a Debtor to Enter into a
Compromise or Amicable Settlement
a. Preliminary attachment or foreclosure threats on
mortgaged properly, if applicable;
b. An offer or a willingness to restructure or roll over the
debtor’s/defendant’s obligation – with acceleration
clause provision and/or joint. Several obligor;
c. “Stick and Carrot” tactic – an offer to grant
some concession to the debtor/defendant with
the intention of solidifying your weak position,
if any;
d. Offer of assistance and help to the debtor;
f. Threat of court suit – it must be
remembered that when you use this tactic and
it fails, of necessity and in order not to lose
your credibility, go through with the court suit
immediately.
3. What to provide for in the compromise or amicable
agreement:
a. The acceptance and acknowledgement of the
debt by the debtor and the other obligors
including the surety if any;
b. Proposed repayment schedule;
c. Time or schedule of payment;
d. Interest, penalty provisions;
e. Surety, collateral or security provisions, if agreed;
f. Acceleration clause – a must;
g. Non-novating clause on lien or encumbrance on
security or collateral, on the parties to the
obligation, on decision already obtained and
other pertinent provision to fortify your position;
h. Specific place of payment and waiver of

demand therefor;
i. Provisions for reasonable attorney’s fees;
j. Right to demand a writ of execution in case
of failure to comply with terms or conditions
therefor by the defendant.
SMALL MONEY CLAIM COLLECTION IN COURT
WITHOUT THE NEED FOR AN ATTORNEY
Rules of Procedure For Small Claim Cases

1. Scope:
 Rules of procedure in actions before
municipal/city courts.
2. Value of claim:
 Not more than Php100,000.00 pesos
exclusive of interest.
3. Definitions of terms:
a) Plaintiff – the party who initiated a small
claim action; includes a defendant who filed a
counterclaim against the plaintiff;
b) Defendant – the party against whom the plaintiff

has filed a small claim action. It includes a plaintiff
against whom a defendant has filed a claim, or
person who replies to the claim;
c) Person – is an individual ,corporation,
partnership, limited partnership, association or other
juridical entity endowed with personality by law;
d) Individual – is a natural person;
e) Motion – a party’s request written or oral, to the
court for an order or other action. It shall include an
informal written request to the court such as a letter;
f) Good course – circumstances sufficient to

justify the requested or order or other action, as
determined by the judge;
g) Affidavit – a written statement or declaration
of facts that are sworn or affirmed to be true.
4. Applicability:
a. Applies to purely civil case in nature where
the claim or relief prayed for by the plaintiff is
solely for payment or reimbursement of sum
of money; or
b. The civil aspect of a criminal action, either filed before

the institution of the criminal action, or reserved upon the
filing of the criminal action in court, pursuant to Rule III
of the Revised Rules of Criminal Procedures.
The claim or demands may be:
a. Money owned by reason of a lease, loan, services,
sale or contract of mortgage;
b. For money claims/demands arising from either
 Fault or negligence
 Quasi-contract o r
 Contract
c. Enforcement of a barangay amicable settlement or an
arbitration award involving a money claim (Sec. 417 R.A.
7160-Local Government Code)
II. How is small claim commence?

1. A small claim is commenced upon the filing of
a verified statement (affidavit) of claim (Form
1-SCC) in duplicate accompanied by a
certification of a non-forum shopping (Form 1-
A-SCC) and,
2. Accompanied by duly certified copies of the
actionable document (or evidence of the
claim); as well as the,
3. Affidavits of witnesses and other evidences to
support the claim;
4. No evidence is allowed during the hearing which were

not attached to or submitted together with the claim,
unless good reason is shown for its admission as
additional evidence.
5. No normal pleading, other than the statement of claim
prescribed under this rule is necessary to initiate a small
claim.
6. Consolidation of Claims – plaintiff may join in a single
statement of claim one or more small claims against a
defendant, provided that the total amount claimed,
exclusive of interest and costs, does not exceed Php100,
000.00.
a. Affidavit – the affidavit under this rule shall state only
facts of directs personal knowledge of the affiants which
are admissable in evidence;
7. Payment of filing Fees:

a. Plaintiff shall pay the docket and other legal fees
prescribed under the Rule 141 of the Rules of Court,
unless allowed to litigate as an indigent.
b. An indigent litigation must accomplished form 6 SCC,
and referred to the executive judge for immediate
action in case of multi-sala courts or to the presiding
judge of the court hearing the case. If the motion is
granted, the case shall be raffled off -or assigned to a
court designated to hear the case.
c. If motion to litigate as indigent is denied, the plaintiff
has 5 days within which to pay the docket fees,
otherwise, the case is dismissed without prejudice.
8. Dismissal of the Claim – a small claim

maybe dismissed outright if the evidence by
itself does not proved the claim such as those
reasons provided in dismissing a civil action.
Rule 16 (Rule of Court)

Grounds for Motion To Dismiss for cases more than
Php100,000.00 under regulation courts.
1) Court has no jurisdiction over the person of the defendant or
over the subject of the action or suit;
2) Court has no jurisdiction over the nature of the action or
suit;
3) Venue is wrong;
4) Plaintiff has no legal capacity to sue;
5) There is another action pending between the same parties
for the same cause;
6) Cause of action is barred by statue of limitation;
7) Complaint state no cause of action;
8) The claim or demand set forth in the plaintiff ’s pleading has
been paid, waived, abandoned, or otherwise distinguished;
9) The claim on which the action or suit is

founded is unenforceable, covered by the
statute of frauds;
10) The suit is between members of the same
family and no earnest effort toward a
compromise have been made.
9. Summons and Notice of Hearing

a. If no ground for dismissal is found, the
court shall issue summons (Form 2-SCC)
on the day of receipt of the statement of
claim, directing defendant to submit a
verified response
b. A notice to both parties (Form 4-SCC) to
appear before the court on a specific date,
time of hearing with warning for unjustified
postponement.
c. The summons and notice to be served on

the defendant shall be accompanied by a
copy of the statement of claim and documents
submitted by the plaintiff, and a copy of the
response (Form 3-SCC) to be accomplished
by the defendant.
d. The notice shall contain an express
prohibition against the filing of a motion to
dismiss or any other motion under Rule 14 of
this rule.
10. Response
a. Defendant shall file with the court and serve upon
plaintiff a duly accomplished, verified response
within a non-extendible period of 10 days from
receipt of summons.
b. The response shall be accompanied by certified
photocopies of documents, as well as affidavits of
witnesses and other evidences in support thereof.
c. No evidence shall be allowed during the hearing
which was not attached to or submitted together
with the Response, unless good course is shown
for the admission of additional evidence.
11. Effect of Failure to File Response –

failure of defendant to file a timely
response the court shall render judgement
as maybe warranted by the facts alleged by
the statement of claim limited to the what
is prayed for without prejudice at the
discretion of the court to reduce the
amount claim for being excessive or
unconscionable.
12. Counterclaim Within the Coverage of the Rule

a. If at the time the action is commenced, defendant
possesses a claim against the plaintiff that;
1. Is within the coverage of this Rule; exclusive interest and
costs;
2. Arises out of the same transaction or event that is the
subject matter of plaintiff’s claim;
3. Does not require for its adjudication the joinder of the third
parties;
4. Is not the subject of another pending action the claim shall
be filed as a counterclaim in the Response otherwise, the
defendant shall be barred from suit on the counterclaims.
5. Defendant may also elect to file a counterclaim against the
plaintiff that does not arise out of the same transaction or
occurrence and nature thereof are within the coverage of
this Rule and the prescribed docket and other legal fees
are paid.
13. Prohibited pleadings and motions under the rule:

a. Motion to dismiss except on the ground of lack of
jurisdiction.
b. Motion for bill of particular.
c. Motion for new trial or for reconsideration of a
judgement or for reopening of trial.
d. Petition for relief from judgement.
e. Motion for extension of time to file pleadings, affidavit
or any other paper.
f. Memoranda.
g. Petition for certiorari, mandamus, or prohibition
against, any interlocutory oreder issued by the court.
h. Motion to declare defendant in default.
i. Dilatory motion for postponement.

j. Reply.
k. Third party complaints; and
l. Intervention.
14. Availability of Forms; Assistance of Court

Personnel – the clerk of court personnel shall
provide such assistance as maybe requested
by the parties as the availability of the forms
and other information about the coverage,
requirements and procedure for small claims
cases.
15. Appearance
a. Parties personally shall appear at the
designated date, time of hearing personally
or;
b. Through a representative duly authorized
under a special power of attorney (Form 5 -
SCC) to enter into an amicable settlement,
to submit to mediation, and to enter into
stipulations or admissions of facts and of
documentary exhibits;
c. An attorney for either party is prohibited to

represent any of the parties unless the
attorney is the plaintiff or defendant
himself/herself;
d. If the court determine that a party cannot
properly present his/her claims or defense
and needs assistance, the court may in its
discretion, allow another individual who is not
an attorney to assist that party upon his/her
consent.
16. Non-Appearance of Parties

a) Failure of the plaintiff to appear shall be a cause for
the dismissal of the claim without prejudice.
b) The defendant who appears shall be entitled to
judgement on a permissive counter -claim.
c) Failure of the defendant to appear shall have the
same effect as a failure to file a response under Sec.
12 of this rule.
d) This shall not apply where one of two or more
defendants who are sued under a common cause of
action and pleaded a common defense appears at the
hearing.
a. Failure of both parties to appear shall cause of
dismissal of the case with prejudice of both the claim
and the counterclaim.
17. Postponement – upon proof of the physical

inability of the party to attend an scheduled date
and time only one postponement is allowed the
parties.
18. Reading of the nature, purpose and rules of
procedures of small claim.
19. Judicial Dispute Resolution (JDR)
a. The judge shall conduct JDR through mediation,
conciliation, early neutral evaluation or any other
mode of JDR.
b. Any settlement (Form 7-SCC) or resolution (Form
8-SCC) of the dispute shall be reduced in writing,
signed by the parties and submitted to the court
for approval (Form 12-SCC)
c. If JDR fails and the parties agree in writing

(Form10-SCC) that the hearing of the case shall
be presided by the judge who conducted the
JDR, the hearing shall proceed in an informal
manner and terminated within 1 day.
d. Absent such agreement:
d-1) In case of a multi-sala court, the case
shall on the same day, be transferred (Form 11 -
SCC) to the office of the Clerk of Court for
immediate referred by the Executive judge to the
pairing judge for hearing decision within 5
working days from referral; and,
d-2) In case of a single sala court, the

pairing judge shall hear and decide the case in
the court of origin with 5 working days from
referral by the JDR judge.
20. Decision:
a. After the hearing, the court shall render its
decision on the same day, based on the facts
established by the evidence (Form 13-SCC)
b. The decision shall immediately be entered by
the clerk of court in the court docket for civil
cases and a copy thereof forthwith served on
the parties.
21. Execution – if the decision is in favor of

the plaintiff, execution shall be issued upon
motion (Form 9-SCC). The decision is final
and unappealable.
22. Rules of Procedures Application – the
Rules of Civil Procedure shall only apply in
supplementation as they are not inconsistent
with this Rule.
THE LEGAL RESPONSIBILITIES OF A
CREDITMAN
 For every collection effort one undertakes,
some contingent legal entanglement may arise
between the creditor and the debtor. It is always
good if you are properly advised by an attorney,
but most often than not you may have already
committed apparent negative collection efforts
which may have gotten the ire or goat of the
debtor when collecting.
 The legal pitfalls attendant to collection efforts
may cover the charges of libel, invasion of the
right of privacy, assault battery, unjust vexation,
malicious mischief and similar acts.
LAWS THAT COLLECTORS MUST KNOW
AND UNDERSTAND WHEN COLLECTING
1. Libel or Defamation (Art. 353, RPC) – is a
public and malicious imputation of a crime,
vice or defect, real or imaginary, or any act,
omission, condition, status or circumstance
tending to cause dishonor, discredit, or
contempt of a natural or juridical person or to
blacken the moemory of one who is dead.
2. Stander or Oral Defamation (Art. 358, RPC)
– uttering publicly, writing grave or insult or
defamation which is of a serious or insulting
nature.
3. Unjust Vexation – it is equated with anything
that annoys or irritates without justification.
4. Incriminating Innocent Person (Art. 363,
RPC) – any person who, by any act not
constituting perjury, shall directly incriminate or
impute to an innocent person the commission of
a crime.
5. Intriguing Against Honor (Art. 364, RPC) –
any person who shall make any intrigue which
has for its principal purpose to blemish honor and
reputation f another person.
6. Qualified Trespass to Dwelling (Art. 280, RPC)
– any private person who shall enter the dwelling of
another against the latter ’s will. There is no trespass
to dwelling if the entrance of a person in another ’s
dwelling is for the purpose of preventing some
serious harm to himself or for the purpose of
rendering some humanitarian service.
7. Other Forms of Trespass (Art. 281, RPC) – any
person who shall enter the closed premises or the
fenced estate of another, while either of them are
uninhabited, if the prohibition to enter be manifest
and the trespasser has not secured the permission of
the owner or the caretaker thereof.
8. Grave Threats (Act. 282, RPC) – any person who
shall threaten another with the infliction upon the
person, honor or property of the latter or of his family
of any wrong, amounting to a crime.
9. Light Threats (Act. 283, RPC) – a threat to
commit a wrong not constituting a crime which
demand for money or that other conditions is
imposed, even though not unlawful; whether or not
the offender attained his purpose.
10. Grave Coercion (Art. 286, RPC) – any person
who without authority of law shall, by means of
violence, prevent another from doing something not
prohibited by law or compel him to do something
against his will whether it to be right or wrong.
11. Extortion – collecting money with the use

of harassment, coercion, simulated legal
process to threaten debtors may be a ground
for being liable for extortion.
12. False Testimony in Civil Cases (Art.
182, RPC) – any person who gives testimony
to civil case which relates to the case, is
proven false, given in malicious manner with
the intent to affect the issue presented in the
case.
13. False Testimony in Other Cases and

Perjury in Solemn Affirmation (Act. 183,
RPC) – any person who, knowingly making
untruthful statements under oath or make an
affidavit, upon any material matter before a
competent person authorized to administer an
oath in cases in which the law so requires.
Any person who, in case of a solemn
affirmation made in lieu of an oath, shall
commit any falsehood.
14. Assault and Battery – an unlawful offer

or attempt with force or violence to do a
physical harm to another is assault. An
unlawful beating or other wrongful violence or
constraint inflicted on human being without
his consent. Includes unlawfully touching the
person whether willfully committed or arose
from want of due care is battery.
15. Falsification by Private individual and use
of falsified documents (Art. 172, RPC)
a. Any private individual who shall commit any of
the falsifications enumerated in the next
preceding article in any public or official
document or letter of exchange or any other
kind of commercial document; and
b. Any person who, to the damage of third party,
or with the intent to cause such damage, shall
in any private document commit any of the
acts of falsification enumerated in the next
preceding article.
c. Any person who shall knowingly introduce

in evidence in any judicial proceeding or to
the damage of another who, with the intent to
cause such damage, shall use any of the false
documents embraced in the next preceding
article or any of the foregoing subdivisions of
this article, shall be punished by the penalty
next lower in degree.
SALES, CREDIT AND COLLECTION LAWS
FOR NON-ATTORNEY
 Ethical Standards for

Creditmen/Collectors
Every person must, in the exercise of his
rights and in the performance of his duties,
act with justice, give everyone his due, and
observe honesty and good faith. Debtor,
borrowers have rights to be safe guarded,
reputation to protect and dignity to uphold.
FOR NON-ATTORNEY
1. Prying into the privacy of another ’s residence,
office;
2. Meddling with or disturbing the private life or
family relations of another;
3. Intriguing to cause another to be alienable from
his friend;
4. Vexing or humiliating another on account of his
religious beliefs, lowly slotion in life, place of
birth, physical defect or other personal condition.
The foregoing are the expressed provisions of

law about interaction between and among people
most especially in credit and collection. Prudence,
discreetness and ethical individual must observe.
FOR NON-ATTORNEY
 BSPs Collection Ethical Rules
Unfair Collection Practice Sec. 320.14
– Banks, subsidiary /affiliate credit card
companies collection agencies and other
agents may resort to all reasonable and
legally permissible means to collect amounts
due them, provided, that they must observe
good faith and reasonable conduct and refrain
from engaging in unscrupulous or untoward
acts.
FOR NON-ATTORNEY
 Violation Which are Subject to Sanctions
- The use of threat of violence or another criminal
means to harm the physical person reputation
or property of any person;
- The use of obscenities, insults, or profane
language which amounts to a criminal act or
offense under applicable laws;
- Disclosure of the names of consumer or credit
card holders who allegedly refuse to pay debts;
- Threat to take any action than can not legally
be taken;
FOR NON-ATTORNEY
- Communicating or threat to communicate to any
person credit information which is known to be
false, including failure to communicate that a debt
is being disputed,
- Any false representation or deceptive means to
collect or attempt to collect any debt or to obtain
information concerning a cardholder or consumer;
- Making contact at unreasonable or inconvenient
times or hours which shall be defined as contact
before 6:00 A.M. or after 10:00 P.M. unless the
account is past due for more than 60 days or the
consumer or the cardholder has given express
permission of said times are the only reasonable or
convenient opportunities for contract.
FOR NON-ATTORNEY
 Sanctions
Violations of the provisions of this section
shall be subject to any or all of the following
sanctions depending upon the severity:
1. Disqualification of the bank concerned from
the credit facilities of the BSP;
2. Prohibition of the bank concerned from the
extension of additional credit accommodation
against personal security;
3. Penalties and sanctions provided under Sec.
36 and 37 of the R.A. 7653.
THANK
YOU!!

Chapter 5: The Legal Aspects of Credit and Collection: Adapon, Maria Alicia Castillo, Peter F3C Fincredi

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Chapter 5: The Legal Aspects of Credit and Collection: Adapon, Maria Alicia Castillo, Peter F3C Fincredi

Uploaded by

Copyright:

Available Formats

CHAPTER 5: THE LEGAL

ASPECTS OF CREDIT AND

Adapon, Maria Alicia

1. It is the necessary and logical thing to do;

1. Absence or lack of actionable

2. Insufficient documents – try to complete

5. Unnotarized document – have the document

8. Debtor’s properties are encumbered or

9. Debtor have filed for voluntary

10 . Debtor’s business have been assigned/

1. Sending of proper demands to the party –

4. Filing of the case

b. Motion for bills of particulars (for

d. Motion for extension of time to file an

The pre-trial seeks to solve any or all of the

5. Limitation of the number of witnesses;

Depositions are generally taken due to the

h. Specific place of payment and waiver of

Rules of Procedure For Small Claim Cases

b) Defendant – the party against whom the plaintiff

f) Good course – circumstances sufficient to

b. The civil aspect of a criminal action, either filed before

II. How is small claim commence?

4. No evidence is allowed during the hearing which were

7. Payment of filing Fees:

8. Dismissal of the Claim – a small claim

Rule 16 (Rule of Court)

9) The claim on which the action or suit is

9. Summons and Notice of Hearing

c. The summons and notice to be served on

11. Effect of Failure to File Response –

12. Counterclaim Within the Coverage of the Rule

13. Prohibited pleadings and motions under the rule:

i. Dilatory motion for postponement.

14. Availability of Forms; Assistance of Court

c. An attorney for either party is prohibited to

16. Non-Appearance of Parties

17. Postponement – upon proof of the physical

c. If JDR fails and the parties agree in writing

d-2) In case of a single sala court, the

21. Execution – if the decision is in favor of

11. Extortion – collecting money with the use

13. False Testimony in Other Cases and

14. Assault and Battery – an unlawful offer

c. Any person who shall knowingly introduce

 Ethical Standards for

The foregoing are the expressed provisions of

You might also like