Commodatum Mutuum Deposit (articles Guaranty (articles Surety

1962 – 2009) 2047 – 2084)

When the bailor Where the lender A contract A contract whereby A contract whereby a person
(lender) delivers to delivers to the constituted from the a person (surety) Binds himself
the bailee
borrower money or moment a person (guarantor) solidarily with the Principal
(borrower) a non other consumable receives a thing Binds himself to the debtor* a relation which
consumable thing so thing upon the belonging to Another, creditor to fulfil the exists where one Person
that the latter may condition that the with the obligation of Obligation of the (principal) has undertaken
use it for a certain latter shall pay the safely Keeping it and principal debtor in obligation.
time and return the same amount of of returning the case The latter fail
identical thing. the same kind and same. to do so.
quality.
Object: non Object: Liability is contractual and
consumable consumable Accessory, Liability arises only
if principal debtor is held
liable.
Cause: gratuitous Cause: may or may May be gratuitous Gratuitous or Gratuitous
not gratuitous Onerous
Purpose: temporary Purpose: Safekeeping Liability depends Surety assumes liability as
possesion consumption upon an regular party to the
independent undertaking
agreement to pay
 the obligation if
primary debtor fails
to do so.
Subject matter: real Subject matter: may be movable or A. Personal - the Surety undertakes to pay if
or personal property only personal immovable guaranty is the the principal DOES NOT PAY
property property/movable/c credit
orporeal Things only Given by the person
in case of who guarantees the
Extrajudicial deposit fulfillment of the
principal Obligation.
B. Real - the
guaranty is the
property, Movable
or immovable.
Ownership: retained Ownership: passed Retained by the Guarantor binds Surety is an original promisor.
by the bailor to the debtor depositor himself to pay if the Surety is primarily liable
principal CANNOT PAY Insurer of the debt Surety
cannot avail of the benefit of
excussion and division
Thing to be Thing to be Product, accessories, Collateral Benefit of Excussion (Art
returned: exact returned: equal and accessions of the undertaking 2058)
thing loaned amount of the Thing deposited (art Guarantor is  The right by which the
 same kind and 1983) secondarily liable guarantor
quality Insurer of solvency cannot be compelled to pay
of debtor Guarantor the creditor unless the latter
can avail of the has exhausted all the
benefit of excussion properties of the principal
and division in case debtor, and has resorted to all
creditor proceed of the legal remedies against
against him such debtor.
Who bears loss: Debtor/ The depositor shall Continuing guaranty (Art 2053) One which is not
bailor/ When returned: reimburse the any limited to a single transaction but which
in case of urgent only after the loss. Depositor can contemplates a future course of dealings, covering a
need, even before expiration of the demand the return at series of transactions generally
the expiration of the term will
term
PLEDGE MORTGAGE ANTICHRESIS (Articles REAL ESTATE CHATTEL MORTGAGE
2132 -2139) MORTGAGE (Articles (Articles 2140-2141)
2124-2131)
Common: Secures the must be the debtor must have free A contract whereby the A contract by virtue of
fulfillment of a principal absolute disposal of their debtor secures to the which personal
obligation; NO PACTUM owner of the property, or be legally creditor the fulfillment of property is recorded in
COMMISORIUM thing pledged authorized for such a principal obligation, the Chattel Mortgage
or mortgaged purpose. specially subjecting to Register as a security
such security immovable for the performance of
property or real rights an obligation
over immovable
property in case the
principal obligation is not
complied with at the
time stipulated.
contract wherein the A contract whereby
debtor delivers to the the creditor acquires
creditor or to a third the right to receive
person a movable or the fruits of an
document evidencing immovable of the
incorporeal rights for the
purpose of securing
fulfillment of a principal
obligation with the
understanding that when
the obligation is fulfilled,
the thing delivered shall
be returned with
all its fruits and
accessions.
Special Requisites (in
addition to the common
essential requisites):
1. Possession of the thing
pledged must be
transferred to the
creditor or a third person
by agreement
2. It can only cover
movable property and
incorporeal rights
evidenced by documents
debtor, with the
obligation to apply
them to the payment
of the interest, if
owing, and thereafter
to the principal of his
credit.
Special Requisites (in Special Requisites (in
addition to the addition to the
common essential common essential
requisites): requisites):
1. It can cover only 1. It can cover only
immovable property and personal or movable
alienable real rights property in general;
imposed upon however, the parties
immovables. may treat as personal
2. It must appear in a property that which by
public instrument its nature would be
3. Registration in the real property;
of title and the registry of property is 2. Registration of the
instruments proving the necessary to bind third mortgage with the
right pledged shall be persons, but not for the Chattel Mortgage
delivered to the creditor, validity of the contract . Register where the
and if negotiable must be  An order for mortgagor resides; if
endorsed foreclosure cannot be property is located in a
3. The description of the refused on the ground different province,
thing pledged and the that the mortgage had registration in
date must appear in a not been registered both provinces
public nstrument to bind provided no innocent required;
third persons, butnot for third parties are involved. 3. Description of the
the validity of the property as would
contract . enable the parties or
other persons to
identify the same after
reasonable
investigation and
inquiry; and
4. Accompanied by an
affidavit of good faith
to bind third persons,
but not for the validity
 of the contract.
5. It can cover only
obligations existing at
the time the mortgage
is constituted.
Real contract, Accessory, Real contract, Accessory, Accessory contract
Unilateral , Subsidiary Unilateral , Subsidiary 2. Formal contract –
registration in the
Chattel Mortgage
Register is
indispensable for its
validity
3. Unilateral contract

Prohibition against the mortgagee is entitled

double pledge to recover the deficiency.
NOTE: Possession of a This rule applies both to
creditor is an essential judicial and extrajudicial
requisite of pledge. foreclosure real
mortgage.
 The action to recover a
deficiency after
 foreclosure prescribes
after 10 years from the
time the right of action
accrues
PLEDGE VS REM ANTI VS PLEDGE REM VS PLEDGE PLEDGE VS CM
1. Constituted on 1. Refers to real 1. Constituted on 1. Delivery of the
movables property Immovable/Real personal property to
2. Property is delivered 2.Perfected by mere property the mortgage is not
to pledge or by common consent 2. Delivery is not necessary
consent to a third 3. Consensual necessary 2. registration in the
person. contract 3. Not valid against third CMR is necessary for
3. Not valid against third persons unless registered its validity
persons unless a REM VS ANTI 3. Debtor is not
description of the thing 1. Property is REM VS ANTI entitled to excess
pledged and date of delivered to creditor 1. Debtor usually retains unless otherwise
pledge appear in a public 2. Creditor acquires possession of the agreed or except in
instrument only the right to property case of legal pledge
4. Real Contract receive the fruits of 2. Creditor does not have 4. If there is deficiency,
the property, hence, it any right to receive the creditor Is not entitled
does not produce a fruits; but the mortgage to recover
real right. creates a real right over notwithstanding any
3. The creditor, unless the property stipulation
 there is stipulation to 3. The creditor has no Only equity of
the contrary, is obliged such obligation redemption is
to pay the taxes and 4. There is no such available to the
charges upon the obligation on part of mortgagor.
estate mortgagee
4. creditor given
possession of the
property shall apply all
the fruits thereof to
the payment of
interest, if owing, and
thereafter to the
principal
PLEDGE VS CM Period of Redemption
1. Delivery of the thing pledged is necessary 1. Extra-judicial (Act #3135)
2.Registration not necessary to be valid a. natural person – one year from registration of the certificate of sale.
3. If property is foreclosed, the excess over the
b. juridical person – same rule as natural person c. juridical person
amount due goes to the debtor
(mortgagee is bank)
4. If there is deficiency after foreclosure,
creditor is entitled to recover the deficiency - three months after foreclosure or before registration of certificate of
from the debtor, except under Art. 1484 foreclosure which ever is earlier
2. Judicial – before confirmation of the sale by the court