Tiêu đề RFBT Module on Law on Credit Transactions including PPSA.pdf ✅

RFBT – Module 4: Credit Transactions (+PPSA) Atty. Bernadette C. Mendoza, JD, CPA Page 1 of 33 First Semester AY 2025 - 2026 ACREV 424 First Semester, AY 2025 – 2026 LAW ON CREDIT TRANSACTIONS *MCQs/Quizzers are incorporated in this Handout. HIGHLIGHTS – modified because of PPSA Pledge, Real Mortgage and Chattel Mortgage (Similarities, Requisites, Indivisibility, Pactum Commissorium, Third Party Pledgors/mortgagors) Requirements to bind the parties and third persons Obligations and rights of pledgor and pledgee Obligations and rights of mortgagor and mortgagee Modes of extinguishment Contract of Bailments (Real Contracts – Delivery of the Subject Matter) Criteria / Contract Commodatum Mutuum / Loan Deposit Lease Definition A type of gratuitous loan where one party (the lender) allows another party (the borrower) to use a non-consumable item for a specific period without any charge. The borrower is obliged to return the exact item after the agreed period. A loan agreement where one party (the lender) lends consumable items, often money or goods, to another party (the borrower) with the expectation that the borrower will return an equivalent amount of the same kind and quality. A contract where one party (the depositor) gives an item to another party (the depository) for safekeeping, and the depository is obliged to return the same item upon demand. A contractual agreement where one party (the lessor) grants another (the lessee) the right to use an asset (ex. property, equipment) for a specified period in exchange for periodic payments. The lessee must comply with the terms and conditions set forth in the lease agreement. Subject Matter (1) Non-consumable thing (ex. car, book, etc); (2) consumable thing but only for purpose of exhibit (1) money; (2) consumable thing (ex. rice, gasoline, etc) (1) consumable thing; (2) non- consumable thing (1) real property; (2) personal property Purpose For temporary use Transfer of ownership For safekeeping Lessee’s use Characteristics (1) real; (2) essentially gratuitous (1) real; (2) onerous if there is interest, or gratuitous if there is no interest (1) real; (2) onerous if there is depositary fee, or gratuitous if for free (1) real; (2) onerous Example Lending a book to a friend, borrowing a tool from a neighbor Borrowing money from a friend with a promise to pay it back, student loans Placing valuables in a safety deposit box Renting an apartment for a year, car leases Obligation of the Borrower To return the exact same item after use To return the same amount of the same kind and quality, not the exact item To return the item to the depositor or authorized person upon demand To return the property in the same condition, minus ordinary wear and tear at the end of the lease and To pay the agreed rental amount on time 01 Which of the following best describes a contract of bailment under the Civil Code of the Philippines? A. A contract where ownership of goods is transferred permanently B. A contract involving the sale of goods with installment payments C. A contract where one party lends money to another D. A contract where possession of a movable item is transferred for safekeeping or use 02 Which of the following contracts is not an accessory contract? A. Contract of loan B. Contract of pledge C. Contract of mortgage D. Contract of antichresis ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA


RFBT – Module 4: Credit Transactions (+PPSA) Atty. Bernadette C. Mendoza, JD, CPA Page 4 of 33 First Semester AY 2025 - 2026 C. C becomes the owner of the mortgaged car upon D’s default of the loan. D. D remains to be liable to C for the loan in case he defaulted in the payment of the secured loan. Instances where the thing pledged or mortgaged may be sold or alienated in public auction for the payment of the secured contract of loan or principal obligations: 1. If the pledgor or mortgagor fails to fulfill certain conditions and such violation would make the debt due and demandable 2. If the debtor has lost the right to make use of the period or where there is an acceleration clause in the payment of installment 3. Upon default to pay the obligation at maturity 20 The following are the instances where the thing pledged or mortgaged may be sold or alienated to pay the principal obligation, except A. If the pledgor/mortgagor fails to fulfill certain conditions and such violation would make the debt due and demandable B. If the debtor has lost the right to make use of the period or where there is an acceleration clause in the payment of installment C. Upon default to pay the obligation at maturity D. Before maturity of the principal obligation 21 Juan pledged his motorcycle to secure a loan. The loan agreement states that if he fails to pay any installment, the entire debt becomes due without need of further demand. After missing one installment, the creditor initiates a public auction of the motorcycle. Is this action legally justified? A. No, because only full default allows auction. B. No, because the motorcycle is not a valid pledge item. C. Yes, but only after court approval. D. Yes, because the acceleration clause makes the debt due and demandable. 22 Maria mortgaged her land to secure a loan. The contract states that failure to comply with any condition will render the debt immediately due. She violated a condition unrelated to payment. Can the land be sold at public auction? A. Yes, because violation of any condition makes the debt demandable. B. Yes, but only if the condition relates to interest payments. C. No, unless the creditor files a civil case. D. No, because only payment default allows auction. Indivisibility of K on pledge (P) or mortgage (M) or antichresis (A) 1. Whether the secured K is joint or solidary 2. Not affected by the fact that the debtors are not solidarily liable 3. Even though the debt may be divided among the successors in interest of the debtor or of the creditor 4. Therefore, a. The debtor's heir who has paid a part of the debt cannot ask for the proportionate extinguishment of the pledge or mortgage as long as the debt is not completely satisfied. b. Neither can the creditor's heir who received his share of the debt return the pledge or cancel the mortgage, to the prejudice of the other heirs who have not been paid. The indivisibility of a pledge or mortgage is not affected by the fact that the debtors are not solidarily liable. Rule of Indivisibility NOT applicable: If there being several things given in mortgage or pledge, each one of them guarantees only a determinate portion of the credit. The debtor, in this case, shall have a right to the extinguishment of the pledge or mortgage as the portion of the debt for which each thing is especially answerable is satisfied. 23 D borrowed P10,000 from C and pledged his ring and watch with P4,000 and P6,000 value, respectively. After several days, D pays P4,000 to C. Which of the following statements is correct? A. The contract of pledge is extinguished. B. The contract of loan is extinguished. C. D cannot demand the release of his ring because a contract of pledge is indivisible. D. D may compel C to return the ring because P4,000 of the loan is already paid. 24 Using the same facts as above, only that D and C agreed that the ring will secure P4,000 of the loan and the watch will secure the balance of the loan. After several days, D pays P4,000 to C. Which of the following statements is correct? A. The contract of pledge on the watch is extinguished. B. The contract of loan is fully extinguished. C. D cannot demand the release of his ring because a contract of pledge is indivisible. D. D may compel C to return the ring because the contract of pledge on the ring is extinguished. 25 A and B wrote a promissory note which states “We promise to pay P10,000 to C.” In order to secure his share in the obligation amounting to P5,000, A pledged his specific ring. Also, in order to secure his share in the obligation amounting to P5,000, B pledged his specific watch. At the maturity date of the loan, A paid his share in the obligation amounting to P5,000. Which is correct? A. A may demand the return of his ring. C. B may demand the return of his watch. B. A cannot demand the return of his ring. D. B can demand the return of his watch. ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA