CASE TITLE:NUNELON R.

MARQUEZ, Petitioner, -versus- ELISAN CREDIT CORPORATION,

Respondent. G.R. No. 194642, SECOND DIVISION, April 6, 2015, BRION,J.

A. Issue statement

I. Whether or not Nunelon Marquez has fully paid his obligation to Elisan Credit Corporation.

B. RULES,Law, Regulations, Policies

 Article 1176 of the Civil Code: a general presumption on the effects and nature of obligations in
general.
 Article 1253 of the Civil Code: a specific presumption on the application of payments and
extinguishment of obligations.
 Book IV (Obligations and Contracts) of the Civil Code.

C. 1. ANALYSIS OF FACTS

Who : NUNELON R. MARQUEZ, Petitioner

ELISAN CREDIT CORPORATION, Respondent

What : Nunelon R. Marquez secured a loan from the Elisan Credit Corporation, partially made
payments, but the corporation claims that the loan is still due, triggering additional penalties and
attorney fees.

Where : The jurisdiction where the case is being heard is not specified.

When : The specific timeframe of the case is not mentioned.

How : Nunelon R. Marquez made partial payments towards the loan, but the corporation argues
that the payments should first cover the yearly interest before addressing the principal.

2. ANALYSIS of Arguments and Counter Arguments

Plaintiff Respondent

Argues that the total payments made have
exceeded the principal sum, and therefore,
the loan should be considered fully paid.
Counters that according to their policy,
payments must first cover the yearly
interest before addressing the principal,
and since the entire debt has not been
covered, the additional penalties are
justified.

D. Conclusion
 Based on the analysis of Article 1176 and Article 1253 of the Civil Code, the rule under Article
1253 that payments shall first be applied to the interest and not to the principal shall govern if
the debt produces interest and the principal remains unpaid. In this case, there was no waiver of
interest on the part of Elisan Credit, and the fact that the official receipts did not indicate
whether the payments were made for the principal or the interest does not prove that Elisan
Credit waived the interest. Therefore, Marquez has not fully paid his obligation to Elisan Credit
Corporation.