COMMODATUM

NATURE OF COMMODATUM

Art. 1935. The bailee in commodatum acquires the use of the thing loaned but not its fruits;
if any compensation is to be paid by him who acquires the use, the contract ceases to be a
commodatum.

Commodatum is a real, principal, essentially gratuitous,and personal contract where one of the parties
(called the bailor or lender) delivers to another (called the bailee or borrower) a non-consumable object, so
that the latter may USE the same for a certain period and later return it.

Features or Characteristics of Commodatum as a Contract

(a) real (because perfected by delivery)
(b) principal (because it can stand alone by itself)
(c) gratuitous (otherwise, the contract is one of lease)
(d) personal in nature (because of the trust). (See Art.

Note: Commodatum gives the right to the use (jus utendi) and not the right to the fruits (jus fruendi);
otherwise, the contract may be one of usufruct. But of course a stipulation that the bailee may make use of
the fruits of the thing loaned is valid. (Art. 1940). In such a case, however, the right to get the fruits is
merely incidental and not the main cause of the contract.

Kinds of commodatum
1. Ordinary commodatum – bailor cannot just demand the return of the thing at will, because there is a
period agreed upon by the parties.
2. Precarium – one whereby the bailor may demand the thing loaned at will in the following cases:
a. If the duration of the contract had not been stipulated;
b. If the use to which the thing loaned should be devoted had not been stipulated; or
c. If the use of the thing is merely by tolerance of the owner

Parties to a commodatum
1. Bailor/Comodatario/Commodans – The giver/ lender – the party who delivers the possession or custody
of the thing bailed.
2. Bailee/Comodante/Commodatarius – The recipient/ borrower – the party who receives the possession or
custody of the thing thus delivered.

Art. 1936. Consumable goods may be the subject of commodatum if the purpose of the
contract is not the consumption of the object, as when it is merely for exhibition.

Subject Matter of Commodatum

Usually, only non-consumable goods may be the object of a commodatum for the thing itself should not be
consumed and must be returned, but when a jar of vinegar is given merely for exhibition, the thing itself is
not consumed. It is only used ad ostentationem. Note that the vinegar in this case is non-fungible, for the
same vinegar must be returned.

Counterpart in the Contract of Lease

Note that this provision has a counterpart in the contract of lease, except when they are merely to be
exhibited or when they are accessory to an industrial establishment.

Art. 1937. Movable or immovable property may be the object of commodatum.

Properties That May Be the Object of Commodatum

(a) immovable property
(b) movable property

Example of Commodatum Involving Land

A borrowed B’s land so that he can erect thereon a small barong-barong to be used for the time that A works
in B’s province. If there is no rental this is a case of commodatum, but if rental is paid, this would be a
lease.

Art. 1938. The bailor in commodatum need not be the owner of the thing loaned.
Bailor (Lender) Need Not Be the Owner
Reason for the law: The contract of commodatum does not transfer ownership. All that is required is that
the bailor has the right to the use of the property which he is lending, and that he be allowed to alienate this
right to use. Hence, in lease for example, a lessee may become a sub-lessor, unless he has been expressly
prohibited to do so in the contract of lease.

Mercado and Ebora v. Aguilar

(C.A.) 45 O.G. 5th S. 118, Jun. 30, 1947
FACTS: Mercado, the occupant of a stall in the Batangas market, allowed Aguilar to occupy the same
gratuitously with the promise of Aguilar to return it upon demand. Aguilar claims that Mercado as no right
to demand because Mercado, being a mere lessee of the Batangas municipality had no right to cede its
occupancy in commodatum.

HELD: Mercado had the right to give it in commodatum. If a lessee, by a contract of a sub-lease, may
transfer to another the enjoyment of the thing leased for a consideration, there is no reason why he should
be unable to cede gratuitously its use to the commodatory. Aguilar should return the stall.

Art. 1939. Commodatum is purely personal in character.

Consequently:
(1) The death of either the bailor or the bailee extinguishes the contract;
(2) The bailee can neither lend nor lease the object of the contract to a third person. However,
the members of the bailee’s household may make use of the thing loaned, unless there is a
stipulation to the contrary, or unless the nature of the thing forbids such use.

Personal Nature of Commodatum

Civil Code changes this rule by considering commodatum as purely personal. This is so even if
commodatum is a real contract and constitutes an exception to the rule that all rights acquired by virtue of
an obligation are transmissible.

Consequence of purely personal character of commodatum

1. Death of a party
General Rule: Commodatum is purely personal in character hence death of either bailor or bailee
extinguishes the contract (NCC, Art. 1939) (BAR).
Exception: By stipulation, the commodatum is transmitted to the heirs of either or both party.

2. Lease of the thing subject of commodatum

General Rule: The bailee can neither lend nor lease the object of the contract to a third person.
Exception: Members of the bailee’s household may make use of the thing loaned because members
of the bailee’s household are not considered as third persons.
NOTE: Household members are those permanently living or residing within the same residence
including the household helpers.
Exception to the Exception: Contrary stipulation; or when the nature of the thing forbids such
use.

3. Right of retention
General Rule: The bailee cannot exercise the right of retention against the bailor.
Exception: However, he can exercise the right of retention on the account of damages suffered by
the bailee because of flaws that the bailor knew of but did not disclose to the bailee.

Example of the First Paragraph

A loaned to B the former’s car by way of commodatum. If either A or B dies, the contract is extinguished.
(NOTE: If there are two or more borrowers, the death of one does not extinguish the commodatum as to
the other, unless there is stipulation to the contrary.)

Example of the Second Paragraph

A loaned to B a home theatre component by way of commodatum. B cannot lend or lease this to a friend.
But the children of B in his household may use the same unless there is a stipulation to the contrary. But
said component cannot be used as a chair, because the nature of the thing forbids such use.

Art. 1940. A stipulation that the bailee may make use of the fruits of the thing loaned is valid.
Does Bailee Have Right to Use the Fruits?
(a) As a rule, the bailee is not entitled to the fruits, otherwise the contract may be one of usufruct. It should
be noted that the right to use is distinct from the right to enjoy the fruits, since under the law fruits should
as a rule pertain to the owner of the thing producing the fruits.

(b) However, to stipulate that the bailee makes use of the fruits would not destroy the essence of a
commodatum, for liberality is still the actual cause or consideration of the contract.

Example
A is the bailee in commodatum of B’s land. Incidentally, they may stipulate that A can get some lanzones
from a lanzones tree on the land. Unless there is such a stipulation, A would not be entitled to the lanzones.

OBLIGATIONS OF THE BAILEE

Art. 1941. The bailee is obliged to pay for the ordinary expenses for the use and preservation
of the thing loaned.

Duty of Borrower to Pay Ordinary Expenses

Reason for the law: The bailee is supposed to return the identical thing so he is obliged to take care of the
thing with, as a rule, the diligence of a good father of a family. It follows necessarily that ordinary expenses
for the use and preservation of the thing loaned must be borne the bailee.

Examples
(a) A borrowed an automatic Rolls Royce automobile. He repay for the gasoline, motor oil, and expenses of
greasing and spraying. He cannot ask reimbursement for these.

(b) A borrowed a horse for a journey. If the horse is exhausted, rest must be given to the horse; otherwise,
if A continues the journey with a tired horse, he should be responsible for the consequences of his folly.

Art. 1942. The bailee is liable for the loss of the thing, even if it should be through a fortuitous
event:
(1) If he devotes the thing to any purpose different from that for which it has been loaned;
(2) If he keeps it longer than the period stipulated, or after the accomplishment of the use for
which commodatum has been constituted;
(3) If the thing loaned has been delivered with appraisal of its value, unless there is a
stipulation exempting the bailee from responsibility in case of a fortuitous event;
(4) If he lends or leases the thing to a third person, who is not a member of his household;
(5) If, being able to save either the thing borrowed or his own thing, he chose to save the latter.

Liability for Loss Due to a Fortuitous Event

As a rule, a debtor of a thing is not responsible for its loss thru a fortuitous event. This Article gives the
exceptions in a case of commodatum.

Reason for the Law

(a) Paragraph 1 — This amounts to bad faith or abuse of generosity considering the fact that
commodatum is gratuitous.
(b) Paragraph 2 — He is guilty of a certain kind of default (mora).
(c) Paragraph 3 — Evidently, the giving of the value was made to hold the bailee liable for after
all this is not a sale, and neither is ownership transferred in commodatum.
(Exception — when there is a stipulation to the contrary. It may in a sense be said that the
appraisal converts the commodatum into a mutuum.)
(d) Paragraph 4 — This is prohibited by the law for it amounts to a violation of the personal
character of a commodatum.
(e) Paragraph 5 — This amounts to an act of ingratitude and to a failure to exercise due diligence,
considering the fact that commodatum is gratuitous.

Misuse or Abuse
A misuse or abuse of the property is ordinarily a conversion for which the bailee is generally held
responsible, to the full extent of the loss.
Q: Suppose during the said retention of the bailee by reason of hidden defects, the thing is lost due to a
fortuitous event. Can the bailor hold the bailee liable for said loss based on Art. 1942(2) of the New Civil
Code?

A: NO, the bailee cannot be held liable for the loss. Art. 1942(2) of the NCC contemplates wrongful
retention or a situation where the bailee is not entitled to retain the thing loaned.

Art. 1943. The bailee does not answer for the deterioration of the thing loaned due only to the
use thereof and without his fault.

Art. 1944. The bailee cannot retain the thing loaned on the ground that the bailor owes him
something, even though it may be by reason of expenses. However, the bailee has a right of retention
for damages mentioned in Article 1951.

Generally, Borrower Cannot Retain

Example: A is indebted to B for P500,000. B later borrowed A’s car but refused to return it on the ground
that A owed him some money. B has no right to do this. This is so even if A had borrowed after B had
borrowed the car.

Art. 1945. When there are two or more bailees to whom a thing is loaned in the same contract,
they are liable solidarily.

Solidary Liability of Bailees

This is one more instance when solidary liability is imposed by law.

Q: Following the principle of autonomy of contracts, may the parties to a contract of commodatum validly
stipulate that the liability of the bailees shall be joint?

A: NO. Article 1945 of the New Civil Code expressly provides that in a contract of commodatum, when
there are two or more bailees to whom a thing is loaned in the same contract, they are liable solidarily. It
constitutes as an exception to the general rule of “joint obligations” where there are two or more debtors,
who concur in one and same obligation under Articles 1207 and 1208. Solidarity is provided to safeguard
effectively the rights of the bailor over the thing loaned.

OBLIGATIONS OF THE BAILOR

Art. 1946. The bailor cannot demand the return of the thing loaned till after the expiration
of the period stipulated, or after the accomplishment of the use for which the commodatum has been
constituted. However, if in the meantime, he should have urgent need of the thing, he may demand
its return or temporary use. In case of temporary use by the bailor, the contract of commodatum is
suspended while the thing is in the possession of the bailor.

Generally, Bailor Cannot Demand Immediate Return

A commodatum is for a certain time. This is the reason for the first sentence, first paragraph of Art. 1946.
This is based on equitable grounds for otherwise, the bailee may not be able to make proper use of the thing
borrowed.

Suspension of the Contract

Note that the contract is suspended when the lender has temporary use and possession of the object.

Art. 1947. The bailor may demand the thing at will, and the contractual relation is called a
precarium, in the following cases:
(1) If neither the duration of the contract nor the use to which the thing loaned should be
devoted, has been stipulated; or
(2) If the use of the thing is merely tolerated by the owner.

Precarium
(a) Precarium is a special form of commodatum. In a true commodatum, the possession of the borrower is
more secure.
(b) The possession of the borrower in precarium is precarious, that is, dependent on the lender’s will, hence
the name precarium.

(c) The two kinds of precarium are given in the Article.

Q: If the contract of commodatum is a precarium, will Art. 1942 (1) and (2) of the New Civil Code still
apply?

A: It depends. If there has been a demand on the part of the bailor before the loss of the thing under the
circumstances set forth under Art. 1942 (1) and (2) and the bailee did not return the thing, then the latter is
liable. However, if there has been no demand on the part of the bailor and the thing was lost, the bailor is
estopped and cannot hold the bailee liable for under a contract of precarium, the use of the thing by the
bailee depends on the pleasure of the bailor and no time is fixed for such use. Hence, demand on the part
of the bailor is needed for the return of the thing. Without such, loss of the thing on the hands of the bailee
will not make him liable.

Art. 1948. The bailor may demand the immediate return of the thing if the bailee commits
any act of ingratitude specifi ed in Article 765.

Effect of Commission of Act of Ingratitude

The bailor can demand IMMEDIATE RETURN.

Grounds of Ingratitude
Article 765 provides:
“The donation may also be revoked at the instance of the donor, by reason of ingratitude in the following
cases:
“(1) If the donee should commit some offense against the person, the honor or the property of the
donor, or of his wife or children under his parental authority;
“(2) If the donee imputes to the donor any criminal offense, or any act involving moral turpitude,
even though he should prove it, unless the crime or the act has been committed against the donee
himself, his wife or children under his authority;
“(3) If he unduly refuses him support when the done is legally or morally bound to give support to
the donor.”

Art. 1949. The bailor shall refund the extraordinary expenses during the contract for the
preservation of the thing loaned, provided the bailee brings the same to the knowledge of the bailor
before incurring them, except when they are so urgent that the reply to the notifi cation cannot be
awaited without danger.
If the extraordinary expenses arise on the occasion of the actual use of the thing by the bailee,
even though he acted without fault, they shall be borne equally by both the bailor and the bailee,
unless there is a stipulation to the contrary.

Extraordinary Expenses
(a) As a rule, the extraordinary expenses should be paid by the bailor because it is he who profi ts by said
expenses; otherwise, the thing borrowed would be destroyed.

(b) Generally, notice is required because the bailor should be given discretion as to what he wants to do
with his own property.

Example
A borrowed a motorbike from B. While A was riding on it, he met an accident which greatly damaged the
bike. A was not at fault for he was driving carefully. Both A and B should share equally in the extraordinary
expenses unless there is a stipulation to the contrary.

Art. 1950. If, for the purpose of making use of the thing, the bailee incurs expenses other than
those referred to in Articles 1941 and 1949, he is not entitled to reimbursement.

Other Expenses
Example: The borrower of a car buys an extra jack to be used as a reserve on a trip. Here, he is not entitled
to reimbursement.
 Art. 1951. The bailor who, knowing the fl aws of the thing loaned, does not advise the bailee
of the same, shall be liable to the latter for the damages which he may suffer by reason thereof.

When Bailor Knows Flaws

Example: A lent B a Fisher & Paykel, the electric connections of which were defective. If although he
knows said defect, A does not inform B thereof, A will be liable in case B is injured by reason thereof.

Right of Retention
For the damages spoken of in this Article, the bailee has the right of retention until paid of said damages.

Nature of the Flaws

It is evident that the flaws referred to in this Article are hidden defects, not obvious ones.

Q: Before he left for Riyadh to work as a mechanic, Pedro left his Adventure van with Tito, with the
understanding that the latter could use it for one year for his personal or family use while Pedro works in
Riyadh. He did not tell Tito that the brakes of the van were faulty. Tito had the van tuned up and the brakes
repaired. He spent a total amount of P15,000.00. After using the vehicle for two weeks, Tito discovered
that it consumed too much fuel. To make up for the expenses, he leased it to Annabelle. Two months later,
Pedro returned to the Philippines and asked Tito to return the van. Unfortunately, while being driven by
Tito, the van was accidentally damaged by a cargo truck without his fault. (BAR 2005) Who shall bear the
P15,000.00 spent for the repair of the van?

A: Tito must bear the P15,000.00 expenses for the van. Generally, extraordinary expenses for the
preservation of the thing loaned are paid by the bailor, he being the owner of the thing loaned. In this case
however, Tito should bear the expenses because he incurred the expenses without first informing Pedro
about it. Neither was the repair shown to be urgent. Under Art. 1949, bailor generally bears the extraordinary
expenses for the preservation of the thing and should refund the said expenses if made by the bailee,
provided, the bailee brings the same to the attention of the bailor before incurring them, except only if the
repair is urgent that reply cannot be awaited.

Art. 1952. The bailor cannot exempt himself from the payment of expenses or damages by
abandoning the thing to the bailee.

Effect of Bailor’s Abandonment or Giving of the Object

Example: For extraordinary expenses on A’s car, B the borrower spent P125,000. A cannot exempt himself
from payment thereof by just giving B the thing borrowed.

Q: What if the bailee is entitled to payment or reimbursement of expenses incurred or damages suffered
and the bailor offers the thing loaned as payment for said expenses or damages, would such offer be valid
or not, in view of the prohibition under Art. 1952 which states that the bailor cannot exempt himself from
the payment of expenses or damages by abandoning the thing to the bailee?

A: The offer is not valid. It may be considered as dation in payment. In this case, the abandonment done
by the bailor was made in favor of the bailee for the payment of the expenses incurred by the latter, hence,
a violation of what the law has expressly prohibited under Article 1952 of the New Civil Code.

Prepared by:

Eric John O. Orquero

Deonalyn D. Jamias