2H (AY 2019-2020) RECIT QUESTIONS - CREDIT (Atty Dela Cruz) ANSWERS - ATTY D

January 10, 2020 LOAN

On January 10, 2019, A borrowed 100,000 from B and the carabao of C. A will
1 return/pay both on January 10, 2021. Today (January 10, 2020), A paid the
obligation and returned the carabao. Can Mr. A recover the money and carabao?
What if the carabao in (1) has an offspring? Who will be entitled?
2
What if the money produces interest, who will be entitled?
A, B, and C are SHS Grade 12 classmates. They borrowed money from X.
Promissory note states "I promise to pay X the indebtedness amounting 12,000,
Signed by A/B/C".
3
If B is insolvent and C is a minor, how much will be the share of A in the obligation
to be paid to X?
If a person borrowed money from 3 solidary creditors for 12,000
4 a. To whom should A pay?
B. Can the creditors assign or condone the obligation of A?
A is indebted to B for 100,000. The obligation of A will now be assumed by C. When
5
the due date comes, C cannot pay. Can B require A to pay him on due date?
Mr. A is indebted to B for 10,000. When C learned about the obligation of A to B, C
6
voluntarily effected payment. What will be the right of C against A?
January 17, 2020 LOAN
If Mr. A borrows money and bicycle of B and C respectively, and the money and
1
bicycle was lost, who will shoulder the loss?
Today, B agreed to lend his car to A for 2 weeks to be used for A's wedding and
2 honeymoon. A will get the car on January 30. Come January 30, B refused to give
the car. What can A do?
January 21, 2020 LOAN
1 If the thing borrowed is lost, who bear the loss?
Mr. A borrowed the ATP book of Mr. B. Initially, B was hesitant to lend because Dela Cruz Comments: 1. When did fire take place? 2. Bailor telling bailee of value of item is equal to appraisal
he bought it for 1000. But since they were friends, he gave the books to A,
telling A to return the book on or before January 30, 2020.
2
A likewise borrowed the Credit book of C. C bought it for 1,200 (explicitly
stated by C to A before lending). A said he will return on or before January 30,
2020. Unfortunately, on January 21, 2020, a fire destroyed A's house. 2 books
were destroyed. What happens to the obligation of A to B and C?
In relation to 2, if the two books are still around, may the borrower A be required to
3
return?
In the course of use of car borrowed by A from B and C, A incurred expenses. A is
4
demanding reimbursement before A returns the car. Does A have that right? Dela Cruz Comment: "check if Res Ipsa Loquitur applies"
January 31, 2020 LOAN
The girlfriend of A is to arrive tomorrow morning from USA. A decided to borrow the
1 car of B, which they will use during the stay of girlfriend for 2 weeks. B lent the car to
A. After a week, may the owner B demand the return of the car.
2 When will there be acts of ingratitude?
3 The use of the car will entail expenses, who will shoulder?
4 May the bailee refuse to return the thing to the bailor?
 A borrowed the carabao of B for 1 month for A to be able to plow his rice farm.

5 a. Who will be entitled to the fruits of this carabao?

b. Who will incur and shoulder the expenses in connection with the use of the
carabao?
If A borrowed the roofing materials of B as well as the hammer and saw for A to be
6
able to repair the damaged part. In case of loss, who will shoulder?
February 4, 2020 LOAN, DEPOSIT
February 14, 2020 at 3PM is the wedding day of Mr. A. His future wife requests if it's Damages for breach of contract to enter into commodatum
possible that the bridal car be white. A went to B to borrow the latter's car. They
have agreed that B will lend the car to A for 2 weeks, and will be used for
honeymoon purposes in Baguio.
1
On February 14, 2020 8:00AM, A is trying to get the car from B but B refused to give
because B's girlfriend has requested him to accompany her to a medical doctor.

What can A do under the circumstances?

Mr. A will go to USA on February 14, 2021. He is wondering what will happen to his If bailor will not allow delivery, bailee can go to court and ask for DAMAGES FOR BREACH OF CONTRACT TO
car because no one will be left to take care of his properties including the car. MAKE A COMMODATUM.
Fortunately, here comes B. A and B today agreed that A will lend his car to B, where
2 the duration of contract will be from the time A leaves up to the time he comes back, On the day agreed upon, no need to "BORROW" but ask for "FULFILLMENT"
which is approximately 10 months. However, on February 14, 2021, A refused to
give the car to B. B had already scheduled a vacation in Baguio on February 15,
2020. What can B do?
Assuming in (2) that A gave the car to B. During the use of the car, B incurred
3 expenses. Who will shoulder?
Same as above, A knows that he will probably need money. A borrowed $10,000
from B. Car of A is with B, while the money of B is with A. What if the money and the
4 car were lost. What will happen?
Same as above (4), assuming on the date of obligation of A to pay, and B's
obligation to return the car. B says “the car is worth around 10,000 USD. Don’t pay
5 me back but I will retain the car now.” Is B's statement valid?
A deposits Php 100,000 with B Bank and Sacks of Rice and Corn to C worth Php Contract between A and B - Simple Loan/ Mutuum (nagbigay ka pera sa bank eh) Contract between A and C - Deposit.
150,000, a warehouseman. If 120,000 loan from B is due, B may compensate the debts. If not due, however, B may be compelled to return the
100,000 to A. C also cannot keep the sacks nor can he compel A to use such sacks to settle his debt (pactum
A also borrows Php 120,000 from B Bank and Php 140,000 from C, warehouseman. commissorium). However, A may present to C the possibility of using the sacks as payment of debt, that if C accepts,
Later when A was demanding the return of her deposits, B and C objected. A went to dacion en pago
you for your advice, what will your advice be?
A deposited money with bank: Simple loan (Creditor)
A borrowed money from bank: Simple loan (Debtor)
6
1. Already due? If not - Bank not entitled to compensation; A is entitled to the benefit of the period
2. If due and demandable - A can no longer recover

Deposit of goods to warehouseman: Deposit

Obligation of W: To return the goods; Obligation of A: To pay = HENCE NO COMPENSATION

If W agrees - Dacion en pago, but W cannot compel A to effect dacion en pago. Because dacion en pagod requires
consent/acceptance of creditor.
 A borrowed 100,000 Php from B, with interest at 8%. When the obligation became 1. There is compensation by operation of law. The 120,000 note is valid until annulled. E and F merely step into the
due, B demanded payment. However, A suddenly twisted B’s arm and pointed a gun shoes of A and B. E may collect 20,000 from A.
to B’s head, compelling B to make a promissory note for 120,000 payable to A, as
follows: Note: If negotiable PN, indorsee may acquire a better right than indorser. Illegality of consideration/nullity - a personal
defense. Apply shelter rule.
"I promise to pay A or Order 120,000 (sgd) B."
7
A assigned his note to C, while B assigned his note to D.
Thereafter, C assigned the note to E, D assigned note to F
C does not know of the intimidation, but E knows.

1. How much can E/F collect from the principal debtors?

2. If E/F cannot collect in (1), against whom can they collect?

Same as above (7), assuming instead of the word "assigned", it was "negotiated".
8 What will be your answer?
February 7, 2020 LOAN
1 Guilty of ingratitude means what?
2 When is there an appraisal of the object?
3 What if the thing borroed is being used by the niece of the wife of the bailee?
February 11, 2020 LOAN, DEPOSIT
1 In case of loss of the thing or money borrowed, who bears the loss?
2 If you deposit money or thing to another, what contract will that be?
3 Loss of money deposited, who bears the loss?
Mr. A has a safety deposit box in a bank. And on Valentine's Day, Mr. A is having a Safety deposit box in bank - Lessee not contract of deposit
dinner with his GF. Later, while inside the hotel, he lost his pocket (wallet). When he Nature of transaction will matter not the terminology used.
was washing his hands, he removed his finger ring. He forgot about the ring. When What if bank, restaurant leased to others, restaurant owned by the hotel?
he returned, the ring is gone.
Also, check under what capacity A was in when he was in hotel.
a. The thing he placed in the safety deposit box, are these deposited? Guest of hotel = necessary deposit; Diner = no deposit
4 b. Ring? Who bears the loss?
5 May the person to whom the thing or money deposited use the thing?
February 18, 2020 DEPOSIT, GUARANTY
Ms. A deposited her pieces of jewelry to Ms. B for safekeeping. Can Ms. B later
1
refuse to return the jewelry?
Check if purchaser was in good faith or bad faith. Good Faith = purchsaer now owns jewelry, A may go against B. Bad
2
What if daughter of Ms. B sold the pieces of jewelry. What now? Faith = A may compel return of item from buyer
What if Ms. B will go to a party and decided to wear some of the pieces of jewelry
3
deposited by A. What will happen? Wearing = use. Near impossible that the nature of the jewelry requires use for preservation so B liable for damages
Ms. A, in addition to the pieces of jewelry, deposited also 100 sacks of well-milled
4 rice. Will it be possible for B to place in the same place where the other well-milled
rice are stored?
In addition, Ms. A put some other pieces of jewelry and some cash in her safety
5
deposit box, owned likewise by Ms. B. If these things are lost, who will bear the loss?
The rules to be observed should the depository be incapacitated, and the depositor
6
be incapacitated.
7 What is the benefit of excussion?
8 When will there be sequestration?
February 21, 2020 INTEREST
 2 years ago, February 21, 2018, debtor borrowed money from creditor, payable in 3 (a) If before due date: If there was no waiver on the right of period, and there was erroneous payment (presumed based
years. Obligation carries with it an interest at 7% per annum. Today (February 21, on the facts), debtor can recover before the due date. From the time it was delivered up to the time it was returned,
1 2020), debtor effected payment. 10 months later, debtor realized that the obligation creditor must pay interest for the use of money.
should not have been paid and wants to get back the principal and interest from the
creditor. Is the debtor correct? (b) If after due date: Debtor can no longer recover prinicipal. But liable for interest from the time it is paid to the date
In relation to No. 1, Assuming the debtor realized it 14 months after he had effected before due date.
2
payment, can he recover?
February 28, 2020 OBLICON
1 Can a debtor effect payment by dacion en pago, or by payment by cession?
If the debtor operates payment by dacion en pago or payment by cession, is this
2
debtor insolvent?
3 When is debtor insolvent?
In so far as payment by the debtor by way of consignation, will the obligation be
4
extinguished?
In case obligation is secured by property, and the debtor cannot pay creditor, what
5
can creditor do? Depends if pledge, chattel mortgage, real estate mortgage
Procedure to be undertaken by the creditor in order to run after the security provided
6
by debtor?
In case of foreclosure of secured property, what happens if the proceeds are not
7
sufficient to satisfy the debt?
Can a debtor effect the deposit of a thing to court even if it did not make prior tender
8
of payment?
9 What can the creditor do if the insolvent debtor cannot pay?
March 6, 2020 PLEDGE/FORECLOSURE SALE
In case of default on the part of the debtor and the pledgee now wants foreclosure,
1 what should the pledgee observe to effect the foreclosure of the thing given as a
security?
If the date of the foreclosure sale before its arrival was declared as a special non-
2
working holiday, when will the sale be administered?
3 Who are puffers?
4 May the pledgee appropriate the thing pledged?
In case of foreclosure of security, what are the rules in case of deficiency in
5
forecelosure proceeding?
Coverage for midterms: "All credit transactions except anti-chresis. Up until what we have discussed today."

2J (AY 2019-2020) RECIT QUESTIONS - CREDIT (Atty Dela Cruz)

January 29, 2020 LOAN, DEPOSIT
If the bailee commits acts of ingratitude the bailor may deman the return of the thing.
1
What are the acts of ingratitude?
2 May the bailor refuse to give the object of the commodatum to the bailee?
3 In case the thing loaned is lost, who will suffer the loss?
4 When will there be an act of ingratitude? When will there be an appraisal?
5 When is there ingratitude where the bailee becomes liable?
6 What may be the objects of a loan?
7 Are fungible and consumable the same?
8 What is a contract of deposit?
 9 Can money be the object of a deposit?
10 When is a deposit necessary
11 What contract will you have with a common carrier?
12 What contract will you have with a hotel?
February 5, 2020 LOAN, DEPOSIT
Mr. A borrowed 100K from B which became due today. This was secured by a
promissory notesigned by A. When B demanded payment, A twisted the arm of B
and pointed a gun thereatening to shoot b if he will not make a promissory note
which reads:
I promise to pay A or order P120,000. (Sgd. B)
1
Because of his promissory note, A is saying you are the one indebted, you must pay.
Later, the note was negotiated by B to X. A negotiated the note issue by B to Y. Both
X and Y received the note in good faith. Thereafter, X negotiated the note to Juan,
and Y to Pedro. Juan and Pedro know the circumstances. Who are liable to Juan
and Pedro?
Per doctor's advise, B borrowed 100K from C in order for him to buy his medicine. AS TO THE BIKE:
He likewise borrowed the bike of D. They have agreed that B's obligation to C will be Should there be any expenses, the borrowing of money is shouldered by the debtor
paid on March 5, 2020 and to D on April 5, 2020. B agreed to pay 7% interest for the Bicycle needs to be returned
money borrowed from C. The bike was borrowed from D because B must have his Ordinary expenses (example: putting air on tires) shouldered by bailee
exercises in the morning. Extraordinary at the time the expenditure was incurred, was bailee using the object or not? - bailee and bailor 50-50
1. Should there be expenses, who shall shoulder? Not using it 100% bailor
2. Should the money and bike be stolen, who will suffer the loss? bailee must first communicate possibility of expenditure unless there is emergency
2
3. How much will B pay C if payment was made by B on March 5, 2022? Loss - no delay yet - shouldered by bailor if fortuitous event
Fault of bailee - bailee liable
Even though fortuitous event, bailee will still shoulder (1942)
AS TO THE MONEY:
Loss is shouldered by the borrower
How much will B pay?
7% per annum, no statement that it will be compounded, 7% is not unconscionable
Ms. A deposited her goods and money to B for safekeeping. The goods have a fair
3 market value of 200K and the amount of money is 100K. Later, A borrowed 200K
from B. If A was to get back the goods, should B return the goods and money?
A went to B bank to deposit money and to deposit in a safety deposit box. A
borrowed money from the bank. When A asked for his money, B objects on the
ground that A owes the bank.
4
1. Who is correct, A or B?
2. When A deposited money and deposited in a safety deposit box, what contracts
were made?
A borrowed 100K from B which became due yesterday. On the other hand, B is also
indebted to A for 40K which became due today and another 50K which will be due
tomorrow. Another 60k is due on Feb. 7. B has another obligation to C for 100K
5 which became due today. When B was required by C to pay the obligation, B was
not able to pay because he is still to collect from A. B assigned to C his right to
collect from A. C communicated the assignment on Feb. 6. Will C be able to collect
from A if A agrees? What if A refused?
February 19, 2020
Mr A went to B bank and deposited money, later went to C and deposited his
necklace to C, later A was demanding the return of the necklace, C refused to return.
1 Thereafter, A went to B bank and borrowed money, thereafter weeks or months later
A went back to B bank demanded return of the money bank refused as A is also
indebted to Bank. Was the refusal of B bank justified? Was the refusal of C justified?
2 Daughter of C sold necklace
 If the depositary is aware of who the actual owner of the necklace is, will that justify
3 the depositary in not returning it?
Mr A enter a hotel in makati then he used one of the CR of the hotel to answer the He is not a guest, he entered as an intruder, he must be checked in
call of nature, before entering the CR, he decided to leave his watch and ring at the
front office. at the CR before washing his hands he removed his wedding ring and
4
necklace and placed it on the sink. the pieces of jewelry were gone. he went to the
front office, there was a shifting, the woman who received jewelry is no longer
around. who will shoulder the loss?
while on board a passenger bus, some armed men boarded the bus took everything
5
of value, on of the victims is Mr A. Who will shoulder the loss?
6 What is the benefit of excussion?
7 if guarantor will be the one to effect payment will there be legal subrogation?
8 legal remedies available?
9 is there a distinction between guaranty and surety?
Mr A suffered 2 flat tires and immediately went to store that sells tires, available cash Statute of frauds - special promise to be enforceable must be in writing
was not enough so A is seeking for his friend ask hin to bring money to buy tires but Remedy is to go after the buyer
his friend is in the province. A give cellphone to Mr S, and then gave 2 tires needed. The guarantor will only be liable had assumption of debt be in writing
10
if A will not pay, friend will not pay. A will come back later. The friend is F and Mr S
agreed. Following day, Mr S demanded payment to F, tired amounted to 10,000 can
Mr S collect from F
11 What happens if the depositary is incapacitated and depositor is likewise capacitated
February 26, 2020
The parents of a SHS student will be leaving for the province and the parents asked
the SHS student to look for a person to whom jewelry may be deposited. The SHS
1
student deposited the pieces of jewelry to his teacher for safekeeping. Later, the
SHS student wants to take the jewelry. Can the teacher refuse to return?
The sister of the teacher saw the pieces of jewelry. The ring was sold to a friend and
2
the watch to her grandparents. Can the SHS student still recover the items sold?
Mr. A deposited his goods composed of rice and corn from his farm in the W will go after Warehouseman 1 because A endorsed document of title, not covered in negotiable instruments law, only
Philippines to warehouseman 1 who issued a receipt acknowledging the deposit. Mr. assign the right. Remedy is to go after Warehouseman, no warranty against solvency
B likewise deposited his goods to warehouseman 2. These goods were imported but Warehouseman 1 has a warranty of a depositary
were brought to the Philippines without authority. A receipt was also issued by
3 warehouseman 2. A and B sold the goods and indorsed the receipts to W and Y Y will go to B, B does not have a valid title since goods are smuggled, warranty of legality of goods
respectively. W and Y went to warehouseman 1 and 2, but the goods were no longer Presumption is that goods were lost/confiscated by government, Warehouseman 2 not liable
there. Against whom can W and Y collect? Because B assigned title to Y, violated warranties does not have legal right
Contract of B and Warehouseman 2 is void. B does not have a valid title
Difference is that prior parties have capacity to contract
Ms. A went to a pawnshop to borrow money. Ms. A gave her earrings as security.
The contract provides that if A will not pay within 60 days, the earrings will be
4
forfeited and will serve as the equivalent payment for the obligation. What is the
status of the contract?
5 pactum commissorium v dacion en pago
6 cession, application of payment
7 consignation
In a contract of loan, a stipulation is: if a creditor forecloses the security, a minimum
8 amount is provided so that an amount may be left to the creditor. How much is the
minimum amount?