Distinguished Deposit and Mutuum? (art.

1962)
Deposit Mutuum
Principal purpose is safekeeping/custody Consumption of the subject matter
Depositor can demand the return of the Lender must wait until the expiration of the
subject matter at will period granted to the debtor
Object is both movable or immovable Object is only money and any other fungible
property thing

What is the rule on effect of agreement to Deposit? (art. 1963)

- Deposit is real contract and perfected upon delivery of the object of the contract. Where
there has been no delivery, there is merely an agreement to deposit, which however is
binding and enforceable upon the parties.

Kind of Deposit? / Subject matter of Deposit?

Kinds of Deposit (art. 1964)
1) Judicial Deposit
2) Extrajudicial (art. 1967)
a) Voluntary – delivery is made by
will of the depositor. (art. 1968)
b) Necessary – compliance with
legal obligation.
Subject matter of Deposit (art. 1966)
May be movable or immovable property
Only movable or personal property
Only movable or personal property
Only movable or personal property

Can depositary return the deposit before the expiration of the period/specified term?(art. 1972)
- The thing must be returned to the depositor whenever he claims it, even though a specified
terms for such may have been stipulated in the contract.

What will happened if the depositary suffers on account in a condition of a thing deposited? (art.
1993)
- GR: the depositary must be reimbursed for loss suffered by him because of the character of
the thing deposited:
- Except:
a) Depositor was not aware of.
b) Depositor was not expected to know the dangerous character of the thing.
c) Unless he notified the depositary of the same
d) Depositary was aware of it without advice from depositor.

Causes of extinguishment of deposit? (art. 1995)

- Deposit is extinguished when:
a) Loss or destruction of the thing deposited.
b) Gratuitous deposit: upon the death of either the depositor or depositary.
c) Others:
1- Return of the thing.
2- Novation.
3- Merger
4- Expiration of the term.
5- Fulfillment of the resolutory condition. (art. 1231)
What term deposit derived from?
- Deposit derived from “depositum” of the Roman law.

Characteristic of deposit?
a) REAL Contract – perfected by the delivery of the subject matter.
b) When GRATUITOUS, UNILATERAL Contract – only depositary has obligation.
c) When COMPENSATION, BILATERAL Contract – gives rise to obligation of both parties.

When is deposit constituted/perfected? (art. 1963)

- Deposit is constituted from the moment a person receives thing belonging to another. (art.
1962)

Effect in the contract of deposit if not the principal purpose is safekeeping?

- If the safekeeping is not the principal purpose it constituted as a loan, contract of lease,
agency.

Distinguish deposit and commodatum?

Deposit Commodatum
Principal purpose is safekeeping Transfer of the use
May be gratuitous (art. 1965) Essentially and always gratuitous
Extrajudicial deposit – object is only movable Both movable and immovable
(art. 1966)

Kinds of judicial deposit? (art. 1967)

a) Voluntary – wherein delivery is made by the will of the depositor. (art. 1968)
b) Necessary – compliance with a legal obligation and takes place on the occasion of any
calamities.

Can the depositary deposit the thing to 3rd person? What is the rule when it is allowed? (art. 1973)
- GR: The depositary is not allowed to deposit with 3rd person because a deposit is founded
on trust and confidence.
- Unless there is stipulation to the contrary.
The depositary is liable for the following:
a) Loss if he deposited the thing with a person who is manifestly careless or unfit.
b) Depositary is responsible for the negligence of his employees.

Is Depositary may change the way of the deposit? (art. 1974)

- If there are circumstances indicating that the depositor would consent to the change.
- However: depositary should first notify the depositor and wait for his decision unless delay
will cause danger.
- GR: depositary must take good care of the thing with the diligence of a good father of a
family.

To whom should deposited should be return? (art. 1986)

- When required: depositary should return the thing deposited to
a) Depositor
b) Heirs and successors
c) Person designated in the contract. (art. 1972)
 - Incapacitated depositor at the time of the making the deposit: property must be returned
to his
a) Guardian
b) Administrator
c) Person who made the deposit
d) Depositor himself should he acquire capacity.
- Depositor had capacity at the time of the making the deposit but subsequently loses his
capacity during the deposit: the thing must be returned to his:
a) Legal representatives (art. 1986)

When is depositary liable even if it is fortuitous event? (art. 1979)

- Depositary is liable of the loss of the thing through fortuitous event:
a) If stipulated.
b) if used without depositor’s permission.
c) if delays its return.
d) if he allows other to use even himself have been authorized to use.

Rule when the thing deposited is delivered “closed and seal”? (art. 1981)
- Depositary has the obligation to:
a) Return the thing deposited with the same condition.
b) Pay for damages, when it is broken through his fault, unless proved otherwise.
c) Keep secret of the deposit when seal or lock is broken, without his fault.

When is the deposit be return?

- GR: the depositor can demand the return of the thing deposited at will even do specified
period or time for such return may have been fixed. (art. 1988)
- Right of the depositary to return thing deposited:
1) Deposit gratuitous: depositary may return the thing deposited regardless the period has
been fixed for deposit if:
a) Deposit is gratuitous.
b) Justifiable reasons exist for its return.
2) Deposit for valuable consideration: the depositary has no right to return the thing
deposited before the expiration of the time designated even if he should suffer
inconvenience as consequence.

Necessary deposit?
- a deposit is necessary in the following:
a) in compliance with a legal obligation
b) made on the occasion of any calamity

How do you characterize a contract of a safe deposit box?

1) Contract is not an ordinary contract of lease but a special kind of deposit.
2) Relationship created is that a bailor and bailee.
-
Explain liability of holder keepers/inn keepers relative to items bring into the hotel by travelers? (art.
2000)
- Hotel/inn keepers are liable regardless of the amount of care exercised:
 a) The loss or injury is caused by his servants or employees as well as by strangers,
provided that notice has been given and proper precautions taken (art. 1998)
b) The loss is caused by the act of a thief or robber done without the use of arms and
irresistible force (art. 2001)

Rule where depositary capacitated depositor incapacitated? (Art. 1970)

- He is subject to all the obligation of a depositary whether or not the depositor is
capacitated.
a) The depositary must return the property to the legal representative of the incapacitated
b) The depositor himself if he should acquire capacity.

Formalities required for deposit?

- GR: depositary is capacitated, contract shall be obligatory in whatever form they may have
been entered into provided that all essential requisites for their validity are present. (art.
1356)
- In must be entered into orally or in writing(Art. 1969)

Rule on what the depositary do when he learn that the deposit is the product of theft? (art. 1984)
- Depositary upon discover that the thing has been stolen
a) He must advice the true owner of the deposit.
b) If the owner, in spite of such in information does not claim within the period of 1 month,
the depositary shall return the thing deposited to the depositor.
- Depositary has reasonable grounds to believe that the thing has not been lawfully
acquired by the depositor
a) He may return the same.

Rule where depositary incapacitated depositor capacitated? (art. 1971)

- Depositary is incapacitated, does not incur the obligation to a depositary.
- However:
a) Return the thing deposited while still in his possession.
b) Pay the depositor the amount by which he may have benefited himself with the thing.
c) Its price subject to the right of any third person who acquired the thing in good faith.

Rule when two or more/several depositor? (art. 1968)

- 2 or more depositor each claiming to be entitled to a thing may deposit the same with 3rd
person. 3rd person assumes the obligation to deliver to the one to whom it belong.
- Action to compel the depositor to settle their conflicting claims among themselves would be
in the nature of enter pleader.