A contract of pledge and mortgage, in their nature, share few similarities that can be found along

different provisions of the New Civil Code. Art. 2085 reveals the essential requisites that are
common to both contracts but there are also other articles that embody other similarities in their
characteristics namely Articles 2087, 2088, 2090 and 2091.
For Art. 2085, it talks about four (4) similar requisites incorporated in both the contract of pledge
and mortgage which are 1) both are constituted to secure the fulfillment of a principal obligation,
2) the pledgor (in case of pledge) or mortgager (in case of mortgage) must be the absolute owner
of the thing pledged or mortgaged, 3) the person constituting the pledge or mortgage must have
the free disposal of their property, and in their absence thereof, that they be legally authorized for
the purpose. Disposal of the property here means that the property must not be subject to any
claim of a third person, and 4) when the principal obligation becomes due and there is non-
payment of it, the things in which either contract consists may be alienated as payment to the
creditor. “Thus, in this case, the only remedy available to the mortgagee or pledgee is to have the
security given sold at public auction and the proceeds of the sale applied to the payment of the
obligation secured by the mortgage or pledge.
Article 2085 also made mentioned that third persons who are not parties to the principal
obligation may secure the principal obligation by pledging or mortgaging their own property. A
third person can also pledge or mortgage his own property to secure the debt of another hence it
is really not necessary that the principal debtor should always be the pledgor or mortgagor.
On the other hand, Art. 2087 emphasize the common characteristic between a pledge and
mortgage which is indivisibility. Both contracts are indivisible even though the debt may be
divided among the successors in interest of the debtor or of the creditor. Moreover, the
indivisibility of a pledge or mortgage is not affected by the fact that the debtors are not solidarily
liable, according to Art. 2090.
For Art. 2088, it emphasizes a characteristic common to both a pledgee and mortgagee in a
contract of pledge and mortgage respectively that a pledgee and mortgagee does not become the
owner of the thing pledged or mortgaged. Thus, they cannot appropriate or sell the thing given
by pledge or mortgage. Any stipulation made by the parties to that effect is considered void.
More so, even if the debtor pledgor or mortgagor defaulted in their corresponding obligations,
the pledgee or mortgagee does not immediately become the owner of the thing subject of pledge
or mortgage.
Lastly, both the contract of pledge and mortgage may secure all kinds of obligations,
regardless if these obligations are pure or subject to a suspensive or resolutory condition.

References:
Handout
Topic 6 (Transcript Notes) by Atty. Dente
Online Source
http://www.ilo.org/dyn/natlex/docs/ELECTRONIC/50160/102475/F1500145909/PHL50160.
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