BQ - Cred Trans. 1st exam
3) Is B liable to A for the loss of the jeepney? (1993 BAR)
LOAN
LOAN (1993, 1996, 1998, 2001, 2004, 2005, 2016 BAR)
Q: With regard to an award of interest in the concept of
actual and compensatory damages, please state the
guidelines regarding the manner of computing legal interest
in the following situations:
1. When the obligation is breached and it consists in the
payment of a sum of money like a loan or forbearance of
money;
2. When the obligation does not constitute a loan or
forbearance of money.
Consider the issuance of BSP-MB Circular No. 799, which
became effective on July 1, 2013. (2016 BAR)
A:
1. When the obligation is breached and it consists in the
payment of sum of money like a loan or forbearance of
money, in the absence of stipulation, the rate of interest shall
be the legal rate of 6% per annum, (Art. 2209, CC) which was
increased to 12% per NB Circular No. 905, series of 1982 to
be computed from default. The twelve percent (12%) per
annum legal interest shall apply only until June 30, 2013.
From July 1, 2013, the new rate of six percent (6%) per
annum shall be the prevailing rate of interest when
applicable. (Nacar v. Gallery Frames, 703 SCRA 439 [2013],
applying BSP-MB Circular No. 799)
2. The interest on the amount of damages awarded may be
imposed at the discretion of the court at the rate of 6% per
annum. No interest, however, shall be adjudged on
unliquidated claims or damages, exept when or until the
demand can be established with reasonable uncertainty.
Accordingly, where the demand is established with
reasonable certainty, the interest shall begin to run from the
time the claim is made judicially or extra-judicially, but when
such certainty cannot be so reasonably established at the
time the demand is made, the interest shall begin to run only
from the date the judgment of the court is made (at which
time the quantification of damages may be deemed to have
been reasonably ascertained). The actual base for the
computation of legal interest shall, in any case, be on the
amount finally adjudged. (Nacar v. Gallery Frames, 703 SCRA
439 [2013])
Q: A, upon request, loaned his passenger jeepney to B to
enable B to bring his sick wife from Paniqui, Tarlac to the
Philippine General Hospital in Manila for treatment. On the
way back to Paniqui, after leaving his wife at the hospital,
people stopped the passenger jeepney. B stopped for them
and allowed them to ride on board, accepting payment
from them just as in the case of ordinary passenger
jeepneys plying their route. As B was crossing Bamban,
there was an onrush of lahar from Mt. Pinatubo. The jeep
that was loaned to him was wrecked.
1) What do you call the contract that was entered into by A
and B with respect to the passenger jeepney that was
loaned by A to B to transport the latter’s sick wife to
Manila?
2) Is B obliged to pay A for the use of the passenger
jeepney?
A:
1) The contract is called “commodatum”. (Art. 1933, Civil
Code)
2) No, B is not obliged to pay A for the use of the passenger
jeepney because commodatum is essentially gratuitous. (Art.
1933, Civil Code)
3) Yes, because B devoted the thing to a purpose different
from that for which it has been loaned (Art. 1942, par. 2 Civil
Code)
Q: Distinguish briefly but clearly between Mutuum and
commodatum. (2004 BAR)
A: In mutuum, the object borrowed must be a consumable
thing the ownership of which is transferred to the borrower
who incurs the obligation to return the same consumable to
the lender in an equal amount, and of the same kind and
quality. In commodatum, the object borrowed is usually a
non-consumable thing the ownership of which is not
transferred to the borrower who incurs the obligation to
return the very thing to the lender.
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.
a) Who shall bear the P15, 000.00 spent for the repair of the
van? Explain.
b) Who shall bear the costs for the van's fuel, oil and other
materials while it was with Tito? Explain.
c) Does Pedro have the right to retrieve the van even before
the lapse of one year? Explain.
d) Who shall bear the expenses for the accidental damage
caused by the cargo truck, granting that the truck driver and
truck owner are insolvent?
Explain. (2005 BAR)
A:
a) The contract between Pedro and Tito is one of
commadatum. Of the P15, 000.00 spent, Pedro, the bailor,
shall bear the expenses for the repair of the faulty brakes,
they being extraordinary expenses incurred due to the non-
disclosure by the bailor of the defect or fault; Tito, on the
other hand, shall shoulder that part of the P15, 000.00 spent
for the tune-up, said expense being ordinary for the use and
preservation of the van.
b) The costs for the fuel and other materials are considered
ordinary expenses, and consequently Tito, the bailee, shall
shoulder them. (Art. 1941, Civil Code)
c) No, Pedro cannot demand the return of the van until after
the expiration of the one-year period stipulated. However, if
in the meantime he should have urgent need of the van, he
may demand its return or temporary use.
d) Both Tito and Pedro shall bear equally the costs of the
extraordinary expenses, having been incurred on the
occasion of actual use of the van by Tito, the bailee, even
though he acted without fault.
Q: Distinguish usufruct from commodatum. (1998 BAR)
A: Usufruct is a right given to a person (usufructuary) to enjoy
the property of another with the obligation of preserving its
form and substance. (Art. 562, Civil Code)
current deposits of money in banks and similar
institutions shall be governed by the provisions of
concerning simple loan or mutuum. When a savings
account is opened, a creditor-debtor relationship ensues
with the depositor as the creditor and the bank as the
debtor.
b.) No, the bank had no right to take over Saachi’s bank
deposit. The Hold over agreement states that the right
may be exercised by the bank only after the depositor
incurs any liability to the bank. In this case, the
depositor is only suspected of estafa by another bank in
the Prosecutor’s office. Absent a court order, the bank
cannot withhold the deposit of the depositor.

On the other hand, commodatum is a contract by which one

of the parties (bailor) delivers to another (bailee) something
not consumable so that the latter may use it for a certain
time and return it.

In usufruct the usufructuary gets the right to the use and to

the fruits of the same, while in commodatum, the bailee only
acquires the use of the thing loaned but not its fruits.
Usufruct may be constituted on the whole or a part of the
fruits of the thing. (Art. 564, Civil Code) It may even be
constituted over consumables like money (Alunan v. Veloso,
52 Phil. 545).

On the other hand, in commodatum, consumable goods may

be subject thereof only when the purpose of the contract is
not the consumption of the object, as when it is merely for
exhibition. (Art. 1936, Civil Code)

XII.
Saachi opened a savings bank account with
Shanghainese Bank. He made an initial deposit of
PhP100,000. Part of the bank opening forms that he was
required to sign when he opened the account was a
Holdout Agreement which provided that, should he
incur any liability or obligation to the bank, the bank
shall have the right to immediately and automatically
take over his savings account deposit. After he opened
his deposit account, the Shanghainese Bank discovered a
scam wherein the funds in the account of another
depositor in the bank was withdrawn by an impostor.
Shanghainese Bank suspected Saachi to be. the
impostor, and filed a criminal case of estafa against him.
While the case was still pending with the Prosecutor's
office, the bank took over Saachi's savings deposit on
the basis of the Holdout Agreement.

(a) What kind of contract is created when a depositor

opens a deposit account with a bank?
(b) In this case, did the bank have the right to take
over Saachi's bank deposit?

a.) The contract created when a depositor opens a

deposit account with a bank is a simple loan or mutuum.
Article 1980 of the NCC provides fixed, savings, and