1.
The insolvency of the F debtor ratifies the payment
guarantor entitles the creditor
to demand another guarantor
even if the creditor
designated the guarantor
2. Future debts of unknown
amount may not be
guaranteed because there is
no principal obligation yet
3. Guaranty must be express
but exceptionally it may be
implied from acts of the
guarantor as in guaranty by
estoppel
4. The guarantor can bind
himself for more than what
the debtor is liable for but not
for less
5. The debtor may interpose
against the guarantor all
defenses available against
the creditor
6. The benefit of exhaustion
available to the guarantor is
not available if the guaranty is
in the form of pledge or
mortgage on the guarantor’s
property
7. Execution may be enforced
against the guarantor
whenever a writ of execution
is issued against a debtor
8. If the guarantor pays before
the due date, he cant proceed
against the debtor until that
date arrives except when the
Art 2057- If the guarantor should be 9-15 7 INSTANCES WHERE THE BENEFIT OF
convicted in first instance of a crime EXHAUSTION IS NOT AVAILABLE
involving dishonesty or should become
insolvent, the creditor may demand 1. When the guarantor has
another who has all the qualifications constituted in favor of the
required in the preceding article. The creditor a pledge or mortgage as
case is excepted where the creditor has an addtl security
required and stipulated that a specified 2. Non compliance w/ Art 2060
person should be the guarantor 3. He has a judicial bondsman and
F sub-surety
Art 2053 A guaranty may also be given as 4. G expressly renounces it
security for future debts, the amount of 5. Bound himself solidarily w/
which is not yet known; there can be no debtor
claim against the guarantor until the debt 6. Debtor’s insolvency
is liquidated. A conditional obligation 7. He has absconded, or cant be
may also be secured. sued w/in the Phils unless he
F has left a manager or
Art 2055 A guaranty is not presumed; it representative
must be express and cannot extend to 8. It may be presumed that an
more than what is stipulated therein. execution on the property of the
principal debtor would not result
F in the satisfaction of the
Art 2054 A guarantor may bind himself obligation
for less, but not for more than the 16. If the parties avail of contractual T
principal debtor, both as regards the provision for automatic extension, the
amount and the onerous nature of the guarantor will be released
conditions. Should he have bound 17. in case of a merger between the F
himself for more, his obligations shall be debtor and the guarantor, the guaranty Guaranty is accessory and subsidiary
reduced to the limits of that of the debtor. is extinguished but a sub-guarantor, if
F any, is released
Only if the G pays w/out notifying the 18. there is no excussion/exhaustion in T
debtor judicial guaranty
19. when the principal obligation is F
T modified by agreement, the guarantor Alteration should be onerous as to
is released if he didn’t agree to the impose a new obli or add burden to the
modification even if the modified guarantor
obligation will be less onerous
20. a remission in favor of 1 of 5 F
guarantors extinguishes the principal Extinguished only if remission is made
F obligation but only to the extent of 1/5 w/out the consent of the other Gs
Art 2058 The guarantor cannot be 21. an oral mortgage is void against T
compelled to pay the creditor unless the rd
latter has exhausted all the property of innocent 3 parties but valid bet. the
the debtor, and has resorted to all the parties themselves
legal remedies against the debtor 22. an unregistered RE mortgage may T
T still be the subject of foreclosure
23. a contract of antichresis that
doesn’t specify the interest in writing,
although it expressly mentioned the
principal amount is void and of no
effect at all
24. a chattel mortgage is a real
contract because it requires
constructive delivery by the registration
of the contract in the CM registry
25. what must be contained in an
affidavit of good faith
26. a CM w/out containing an affidavit
of GF is void for all intents and
purposes
27. a lessee may mortgage the thing
leased but only valid during the
effectivity of the lease
28. a mortgage made by a co-owner of
a property w/out the consent of other
co-owners produces no legal effect
29. the nullity of a mortgage does not
render null and void the principal obli it
guarantees
30. a municipality may not mortgage a
patrimonial property being used as a
public market
31. growing fruits while they are
attached to the land may not be proper
objects of CM
32. a machinery classified as RP under
Art 415 NCC may be the object of a
valid CM
33. a mortgage may be gratuitous
34. a mortgage follows the property
whoever the possessor may be
provided there is formal assumption of
mortgage by the transferee
F 35. while the law does not specifically F
Obli to pay interest is not the essence of require the possession of the prop to Not standard but special req
antichresis the antichretic creditor, delivery has
been held a standard characteristic of
the contract of antichresis
F 36. all immovable properties may be T
Antichresis is an accessory, formal, the object of a contract of antichresis F- immovable of the creditor
unilateral contract. Indispensable req of 37. the mortgage extends to both T
registration is not equivalent to natural and artificial accessions
constructive delivery 38. the parties must agree on the F
A statement wherein the parties severally valuation of the fruits for application to Art 2133- actual MV of fruits at the time of
swear that the mortgage is made for the the interest and principal of the debt application
purpose of securing the obli specified in 39. the parties may stipulate to the F
the conditions thereof and for no other share of taxes and charges upon the Art 2135
purposes and that the same is just and estate during the period of antichresis
valid obligation as one not entered into 40. the expenses for preservation of
for the purpose of fraud the prop in an antichresis shall be
F. deducted from the fruits of the same
Affidavit only required for the purpose of 41-43 RIGHTS OF AN ANTICHRETIC CREDITOR
transforming an already valid mortgage A. Right to receive the fruits of the
to a preferred one. Absence of such debtor’s immovable
rd B. Right to the actual MV of the
vitiates the mortgage only as against 3 fruits at the time of the
persons w/out notice application thereof to the
F interest and principal
Lessee not the absolute owner of the C. Right to enjoyment of an
prop immovable
F 44-46 OBLIGATIONS OF AN ANTICHRETIC
Produces a legal effect *Art 493 C CREDITOR
Unless stipulation to the contrary, to pay:
T a. Taxes
b. Charges upon the estate. If he
doesn’t pay: indemnity for
F damages
Municipality is the absolute owner of the c. Apply the fruits after receiving
property them to the interest if owing and
T after, to the principal
47. the chattel mortgage is deemed to T
cover only the prop described therein
F and not like or substituted property
CM primarily for movables under Art 416- thereafter acquired by the mortgagor
417 NCC notwithstanding a contrary stipulation
Exceptions: 48. stocks in trade which are naturally T
a. Bldg. under Art 415 (1) revolving or floating and perishable
b. Estoppel goods that are naturally expected to be
T replaced may be the proper objects of
F (?) a CM, provided the deed must be
Formal assumption not necessary amended every time there is a
replacement of the goods
49. a promise expressed in a CM to F
include debts to be contracted in the
future is a binding commitment that can
be compelled upon the security itself
even if there is no amendment of the
old agreement or the execution of a
new one
50. a stipulation in a RE mortgage
prohibiting the mortgagor fr. Selling the
mortgaged property w/out the written
consent of the mortgagee is valid
because obligations arising from
contract have the force of law bet. the
contracting parties
51. the absence of written consent of
the mortgagee in a sale of a mortgaged
rd
chattel to a 3 party doesn’t affect the
validity of the sale although the
mortgagor could be criminally liable
52. stipulations in a contract of
antichresis for the extrajudicial
foreclosure of the security is void for
lack of legal basis
53. in a RE mortgage foreclosure
pursuant to Art 3135 doesn’t require
personal notice to the mortgagor
54. in RE mortgage and antichresis,
deficiency or the excess is for the
acct/credit of the debtor unlike in the
case of pledge
55. after foreclosure of a CM or PP
paid on installment, the seller cant
recover the deficiency from the buyer
56. the loss of the property mortgaged
by a fortuitous event shall necessarily
free the debtor-mortgagor from the prin
obli
57. the commitment of a buyer at an
auction resell the prop to the mortgagor
beyond the period of redemption is not
binding unless supported by a separate
consideration
58-61
Marquez v Elisan Credit Corp c. Possession of thing mortgaged
remains w/debtor
d. Different procedure in sale in a
public auction
e. If the price of the sale in case of
foreclosure is less than the
T amount of the principal obli,
creditor can recover deficiency
PLEDGE
a. Real
b. Reqt that it be in a public
rd
instrument is merely to bind 3
T persons
c. Possession vested w/ creditor
d. Diff procedure in public auction
sale
e. Creditor not entitled to recover
deficiency
F 62-65 4 DISTINCTIONS: CM and RE
Parties may agree on the same, as in MORTGAGE
mortgage and pledge
CM
T a. Constituted on movables
b. Cant guarantee future oblis
c. CM needs to be registered in CM
T registry as a security for
performance of an obli
d. Registration essential for
validity
T RE Mortgage
a. Constituted on immovable
b. May guarantee future
F obligations
Mortgage is an accessory contract, loss c. Needs to be registered to bind
of the thing mortgaged doesn’t affect the rd
principal contract
3 persons
d. Registration not essential for its
F validity
Right of redemption may be exercised w/
66. a pledger who is not the debtor has F
in 1 yr from the reg of the cert of sale;
the rights of a guarantor to seek Excussion is not included
w/out the reg of the prop, redemption is
reimbursement, subrogation, excussion
still possible even when the commitment
and is not prejudiced by any waiver of
is not supported by a separate
defense by the debtor
consideration
67. the incorporeal right of lease over a F
4 DISTINCTIONS: CM and PLEDGE
condominium unit evidenced by a Lease contract is not a document of title
CM
notarized contract of lease may be which accompanies an incorporeal right,
a. Consensual
validly pledged which may be pledged
b. Requirement of registration is
essential for validity
 rd
68. a pledge made by a 3 party who
is not the owner is void because only
an owner w/out exception may pledge
his property
69. a thing pledged may be alienated at
the instance of the creditor to satisfy
the principal obligation
70. an agreement to the effect that the
thing pledged should be applied in
payment of the obligation by way of
dacion en pago is void because this will
constitute pactum comissorium
71. est tota in tota et tota in qualibet
parte
72. if there are 3 debtors who are
jointly liable, the creditor may enforce
the obligation of each against the
whole thing pledged
73. a pledge is an accessory, real,
unilateral and preparatory contract
74. if a promissory note was used in
pledge and was subsequently sold at
auction to satisfy the principal
obligation for a bid price higher than
the amount secured by the pledge, the
debtor is not entitled to the surplus,
should there be any
75. a verbal pledge is void
76-81
F 82. the pledgee cannot use the thing F
rd pledged without the express authority Art 2104 The creditor cannot use the
A 3 party may pledge another’s of the pledger even if its preservation thing pledged, without the authority of
property w/ authority and consent of the requires the owner, and if he should do so, or
owner of such to secure the principal obli should misuse the thing in any other
F way, the owner may ask that it be
It will amount to dacion en pago judicially or extrajudicially deposited.
When the preservation of the thing
F pledged requires its use, it must be used
There is no more pledge but a valid by the creditor but only for that purpose.
dacion en pago 83. all fruits produced by the thing T
pledged are subject to legal
compensation even in the absence of a
There is whole in the whole and the stipulation to this effect
whole in every part 84. the thing in pledge couldn’t be F
F subjected to a precautionary sale w/out Pledger has the right to alienate the thing
The creditor cant immediately enforce the consent of the pledger pledged provided the pledgee consents
the obligation of the joint debtors against to the sale
the whole thing pledged because he may
do so only when the credit has not been
satisfied in due time 85-91 7 CONDITIONS AND RULES FOR VALID
F EXTRAJUDICIAL FORECLOSURE OF A
It is not preparatory THING PLEDGED
T a. Filing of an application before
the executive judge thru the
clerk of court
b. CoC will examine whether there
was compliance with the
required posting of notice and
publication
F c. Application is raffled among the
Not required to be in writing; no express sheriffs
stipulation d. Auction sale may be had even if
INSTANCES OF LEGAL PLEDGE there is only 1 participating
a. Art 546 wrt necessary and bidder
useful expenses e. CoC shall issue a cert of
b. Art 612 wrt termination of payment indicating the amt of
usufruct indebtedness, the filing fees
c. Art 1731 wrt execution of work collected and the mortgages
upon a movable sought to be foreclosed, the
d. Art 1914 wrt agent’s right to description of the RE and their
retention of objects of an respective obligations
agency until principal effects f. Cert of sale must be approved
reimbursement and pays by the EJ
indemnity g. After the redemption period has
e. Art 1994 wrt depositary expired, CoC shall archive the
f. Art 2004 wrt hotel keepers records
92. the pledge of a pawn ticket must T
renew it if necessary
93. as a rule, a pledgee may deposit
rd
the thing pledged w/ a 3 party of
proven integrity
94. unless stipulated otherwise, the
return of the thing pledged to the owner
extinguishes the pledge
95. for all intents and purposes, the
pledge is extinguished when the thing
pledged is in the possession of the
pledger
96-100
101. the pledgor must pay the
necessary and useful expenses
incurred by the pledgee on the thing
pledged
102-106
pledged in case it wasn’t sold in
st nd
T the 1 and 2 auction
107. the rules governing the F
possession and preservation of the Art 2121 in rel to Art 546 governs
T thing pledged by agreement also apply possession in legal pledge, while Art
to legal pledges 2098 governs that of pledge by
agreement
F 108-110 3 OBLIS OF A PLEDGEE
It may be extinguished even if it is not in a. Take care of the thing with the
the hands of the pledger DGOAFOAF
b. Apply the fruits of the thing for
5 RIGHTS OF A PLEDGOR payment of the interest to the
a. Right to claim back the security principal
pledged on repayment of the c. Be responsible for acts of the
debt w/ interest and other subordinate
charges
b. Right to receive a reasonable
notice in case the pledgee
intends to sell the goods and in
case he doesn’t receive the
notice, he has the right to claim
damages
c. In case of sale, he is entitled to
receive from the pledgee any
surplus that may remain w/ him
after the debt is completely paid
off
d. Right to claim any accruals to
the things pledged
e. If any loss is caused to the
goods due to the mishandling or
negligence of the pledgee, he
has the right to claim the same
T
5 GROUNDS FOR EXTINGUISHMENT OF
PLEDGE
a. Return of the thing pledged by
the Pee to the Pr
b. Statement in writing by the Pee
that he renounces or abandons
the pledge
c. Payment of the debt
d. Sale of the thing pledged at an
auction
e. Appropriation of the thing