IDENTIFICATION

ANTICHRESIS – right to receive fruits

CREDIT TRANSACTIONS – include all the transactions

COMPRAMISE – making reciprocal concessions

BAILOR – delivers possessions of the thing bailed

BAILEE – receives the thing delivered

TRUE OR FALSE
1. The word bailment comes from a French word “bailer” means deliver. TRUE

2. Deposit is constituted judicially only. FALSE

3. The bailee is a party who receives the thing delivered. TRUE

4. The bailee is not obliged to pay for ordinary expenses for the use of preservation of the thing loaned.
FALSE

5. A pledge is a principal contract because it is dependent on its own. FALSE

6. In simple loan, no interest shall be due unless it has been expressly stipulated by writing. TRUE

7. A guaranty is gratuitous unless there is a stipulation to the contrary. TRUE

ENUMERATION
THREE KINDS OF MORTGAGE

 Voluntary
 Legal
 Equitable

THREE CHARACTERESTICS OF A GUARANTY

 ACCESSORY
 SUBSIDIARY
 UNILATERAL

PARTIES OF A BAILMENT

 BAILOR
 BAILEE
QUALIFICATIONS OF A GUARANTOR

 He possesses integrity.
 He has capacity to bind himself.
 He has sufficient property.

DISCUSSION
1. Give at least three distinctions between pledge and mortgage.

(1) Pledge is constituted on movables, while mortgage, on immovables.

(2) In pledge, the property is delivered to the pledgee, or by common consent to a third person, while in
mortgage, delivery is not necessary.

(3) Pledge is not valid against third persons unless a description of the thing pledged and the date of the
pledge appear on a public instrument, while mortgage is not valid against third persons if not registered.

(4) The pledgor can sell the thing pledged with the consent of the pledgee, while the mortgagor can sell
the property mortgaged even without the consent of the mortgagee.

2. Formalities or requisites needed before a pledge may cause the thing to be sold. Article 2112

The creditor to whom the credit has not been satisfied in due time, may proceed before a No- tary Public
to the sale of the thing pledged. This sale shall be made at a public auction, and with notifica- tion to the
debtor and the owner of the thing pledged in a proper case, stating the amount for which the public sale is
to be held. If at first auction the thing is not sold, a second one with the same formalities shall be held;
and if at the second auction there is no sale either, the creditor may appropriate the thing pledged. In this
case he shall be obliged to give an acquittance for his entire claim.

3. Principal purpose of a deposit.

The principal purpose of the contract of deposit is the safekeeping of the thing delivered so that if
safekeeping is only an accessory or secondary obligation of the recipient of the thing, deposit is not
constituted but some other contract like lease. commodatum, or agency.

4. Article 2059. Benefit of excussion.

The guarantor cannot be compelled to pay the creditor unless the latter has exhausted all the property of
the debtor, and has resorted to all the legal remedies against the debtor.