Commodatum and mutuum (simple loan)

distinguished.

It is relatively simple to determine whether a given loan is

commodatum or mutuum by bearing in mind the following

principal points of distinction:

(1) Commodatum ordinarily involves something not consumable (see Art. 1936.), while in mutuum, the
subject matter is money or other consumable thing;

(2) In commodatum, ownership of the thing loaned is retained

by the lender (Art. 1933.), while in mutuum, the ownership is

transferred to the borrower;

(3) Commodatum is essentially gratuitous (ibid.), while

mutuum may be gratuitous or it may be onerous, that is, with

stipulation to pay interest;

(4) In commodatum, the borrower must return the same thing

loaned (ibid.), while in mutuum, the borrower need only pay the

same amount of the same kind and quality;

Art. 1933 LOAN

General Provisions

COMMENTS AND CASES ON CREDIT

TRANSACTIONS

10

(5) Commodatum may involve real or personal property (Art.

1937.), while mutuum refers only to personal property;

(6) Commodatum is a loan for use or temporary possession

(Art. 1935.), while mutuum is a loan for consumption;

(7) In commodatum, the bailor may demand the return of the

thing loaned before the expiration of the term in case of urgent

need (Art. 1946), while in mutuum, the lender may not demand

its return before the lapse of the term agreed upon; and
(8) In commodatum, the loss of the subject matter is suffered

by the bailor since he is the owner (Art. 1942; Art. 1174.), while in

mutuum, the borrower suffers the loss even if caused exclusively

by a fortuitous event and he is not, therefore, discharged from his

duty to pay.

It may also be said that while commodatum is purely personal

in character (see Art. 1939.), mutuum is not so.

Kinds of commodatum.

Commodatum is divided into:

(1) ordinary commodatum (Art. 1933.); and

(2) precarium. — one whereby the bailor may demand the

thing loaned at will. (see Art. 1947.)