CHAPTER 4

CATEGORY: SECTION 5 –

COMPENSATION

Article 1278
March 25, 2016Leave a comment
Compensation shall take place when two persons, in their own right, are creditors
and debtors of each other. (1195)

Ang kabayaran ay mangyayari sa dalawang tao ayon sa kanilang mga karapatan kung
sino ang nagpautang at sino ang umutang.

Article 1279
March 25, 2016Leave a comment
In order that compensation may be proper, it is necessary:

(1) That each one of the obligors be bound principally, and that he be at the same
time a principal creditor of the other;

(2) That both debts consist in a sum of money, or if the things due are
consumable, they be of the same kind, and also of the same quality if the latter
has been stated;

(3) That the two debts be due;

(4) That they be liquidated and demandable;

 (5) That over neither of them there be any retention or controversy, commenced
by third persons and communicated in due time to the debtor. (1196)

Para ang kompensasyon ay nararapat, dpat ito ay :

Upang maging wasto ang compensation, kinakailangan na:

(1) Bawat isa sa mga may utang ay obligado principally, at na siya din ang principal
creditor nung isa;

(2) Kung ang parehong utang ay binubuo ng kabuuan ng pera, o ang bagay na dapat
ibigay ay inilaan upang gamitin, na pareho sila ng uri, at pareho din sila ng kalidad kung
ang nahuli ay nakasaad;

(3) Kung ang dalawang utang ay dapat nang bayaran;

(4) Na ito ay liquidated at hinihingi

(5) Na wala sinuman sa mga ito mayroong anumang mga pagpapanatili o

kontrobersya, na nagsimula sa pamamagitan ng ikatlong tao at nakipag-ugnayan sa
angkop na panahon sa may utang. (1196)

Discussion:

Article 1270 enumerates the requirements or requisites for legal compensation as

follows:

1. “That each one of the obligors be bound principally, and that he be at the same
time a principal creditor of the other” – that parties be mutual creditor and debtor of each
other and their relatonship is a principal one, that is, they are principal debtor and
creditor of each other.
2. “That both debts consist in a sum of money, or the thing due are consumable,
they be of the same kind, and also of the same quality if the latter has been stated”. –
When the debts consist of a money, there is not much of a problem when it comes to
compensation to the concurrent amount. It is a matter of mathematical computation.
3. “That the 2 debts are due” – Thelaw does not require that the parties obligations
be incurred at the same time, what the law requires only is that the obligations be due
and demandable at the same time.
4. “That they be liquidated and demandable” – A debt is considered liquidated when
its amount is clearly fixed. It is unliquidated when the amount is not fixed because it is
still subject to a dispute or to a certain condition
5. “That over neither of them there be any retention or controversy, commenced by
third persons and communicated in due to the debtor” – A debt or a thing cannot be
subject of compensation if the same had been the subject of a garnishment of which the
debtor was timely notified.  When a credit or property had been properly garnished or
attached, it is placed under a custodia legis.  this means it cannot be disposed of
without the approval of the court. Consequently, compensation cannot operate because
a third party is already involved whose claim will be determined by the court

Case Illustration: Metropolitan Bank and Trust Company vs. Joaquin Tonda and Ma.
Cristina Tonda

Article 1280
March 25, 2016Leave a comment
Notwithstanding the provisions of the preceding article, the guarantor may set up
compensation as regards what the creditor may owe the principal debtor. (1197)

Bagaman ang probisyon ng nauuna na artikulo, ang tagapanagot ay maaaring mag

lagay ng sahod/bayad na magpalagay kung ang nagpautang kung may utang sa
pangunahing nangutang.

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