kasi bata or loko-loko, hindi niya alam ‘yung value ng
Credit Transactions
For 3/26/21
Abella 0:00:01 to 0:08:30
JH: By way of recap, take note of Articles 1970 and
1971 and the distinctions and applications for these
particular articles.
Take note that Art 1970 talks about when the
depositary is the capacitated person while the
depositor is an incapacitated person.
Again, the depositary takes all the obligations of a
depositary notwithstanding the fact that the depositor
is an incapacitated person. Only that he can be
compelled to return the thing deposited no longer to the
depositor unless he is no longer incapacitated at the
time of return, in which way you can return it to him.
But in the event that his incapacity still exists, then, you
can be compelled to return to the representative, the
heir, or any person who is authorized to receive the
object.
In so far as Article 1971 is concerned, this is sheer
foolishness. Why? Because are you supposed to
deposit to somebody who is incapacitated? Here, it is
the depositor who is capacitated while the one
incapacitated is the depositary. Kung maayos
naman ‘yung pagiisip mo, bakit ka naman
magdedeposit to somebody who is incapacitated? Are
you going to entrust your particular property to a person
who is incapacitated? Ipapatago mo ba ‘yung Rolex
watch mo to an 8-year old minor? Of course that is
foolishness. O kaya, ipapatago mo ba yung Rolex
watch mo dun sa loko-loko? That is, again, sheer
foolishness.
But nonetheless the authors of the law included this
particular provision of law in order to answer the
situations which may be contemplating the situations
which I mentioned earlier. Nonetheless, take note of
the general rule if this happens.
An incapacitated depositary does not incur all of the
obligations of a depositary. In the first place, his
incapacity *inaudible* has to oblige him to do things…
ikaw nga yung dapat na may kasalanan. However, he
is liable to return the thing while the thing is still in his
possession. So habang nasa kanya pa, he can be
compelled to return it.
And the second one is to pay the depositor the amount
which he may have been benefited. So for example
yung Rolex watch, if nasa kanya pa, pwede mo pang
kunin. But if wala na sakanya, so he was benefited. For
example, he sold your Rolex watch worth 500K for 5k
watch. So, he will be returning to you the 5k. Can you
blame him? No, you are the one to blame. Why did you
have to deposit the Rolex to an incapacitated person?
In so far as the conveyance to a third person is
concerned, binenta na niya for example, the rule again
differs when the buyer is in good faith or in bad faith.
Of course, if the buyer is in bad faith, then, he is to go
against the third person who is in present possession
of the *inaudible* “Kukunin ko yan”, pwede mong
sabihin “because that’s worth 500k” , “binayad mo lang
ng 5k.” Pero ang presumption mo diyan is that person
is in bad faith. Because, sa totoo lang, pwede mo bang
ibenta yung worth 500k for 5k? ‘Pag tinanggap mo
‘yan, there’s already bad faith on your part. If that
person is proven to be in bad faith, then, in which case
pwede mo talaga siyang makuha. Pero if in good faith,
hindi mo na talaga siya pwedeng makuha.
There must have been a confusion there. I’ll repeat
for purposes of clarity.
If that particular object has been conveyed by the
incapacitated person, you have to take into
consideration whether that buyer is a person in good
faith or a person in bad faith. If he is in good faith, you
cannot demand the return. And what is presumed by
law is he is in good faith.
However, if there is evidence that that person is in bad
faith, why? Because in the first place, is it right for you
to be paying 5k for a Rolex watch when you know that
a Rolex watch is a very very expensive watch?
Magkakaroon na ng question. So ang presumption na
diyan is he is in bad faith. Now, if he is in bad faith, you
can either demand the return of the same.
Eh paano yung binayad niyang 5k? It will be
chargeable, icocollect niya ‘yon dun sa incapacitated
person if he can still collect. If he does not, then that is
his own look out already.
So you take note of Articles 1970 and 1971.
Agpaoa 0:08:31 to 0:17:00
So again, in so far as 1973 is concerned you take note
of what does it mean when you say manifestly careless
or unfit. Well, the general rule is that unless there is a
stipulation to the contrary, the provision states that the
depositary cannot deposit the thing with a third person.
Reason? The purpose is for the depository to safekeep
the property in behalf of or for the benefit of the
depositor.
Now… is the depository allowed to deposit the property
to a third person. In the ordinary course of things, hindi
as a general rule unless there is a stipulation to the
contrary whereby the depositor and depositary agreed
that pwede niyang ipatago sa third person in which
case the depositary now is liable for whatever
damages or whatever loss the third person may incur
if he is found to be manifestly careless or unfit.
Now what if he is not found to be manifestly careless
or unfit? In which case, wala siyang magiging
kasalanan. In the first place, pumayag ka na idedeposit
din yung particular object na iyan to a third person.
Then the last sentence there merely goes to show that
the depositary is liable for the negligence of his
employees. Whatever the liability your employee has,
the employer or the depositary is held liable. Take note
of that and then the Article 1974 ‘yung change the way
of the deposit. So for example ‘pag sinabing itago mo
ito sa cabinet mo, nothing more nothing less, sa
cabinet lang ang usapan. Tinago mo sa kitchen.
Because of that, it was lost. There was a change in the
manner of in the way of deposit. If that happens,
because deposit is based on trust, of course the
depositary will be liable. But nonetheless, you take
note also that should you do an action which is different
from what is agreed upon, the depositary must make
sure that he notifies the depositor of whatever change.
In other words, sabihin nya: “yung pinapatago mo sa
cabinet, tinago ko na lang sa kitchen because it is more
safe than in the cabinet.” Kung pumayag yung
depositor, walang problema. Take note also that he
has to wait for the reply of the depositor. Tanungin mo
muna at antayin kung papayag siya o hindi. But then,
if necessity requires that you have to actually keep it in
the kitchen and not in the cabinet, in which case
because of the existing necessity, you can do it without
even waiting for the reply of the depositor. That is the
implication of Article 1974.
Article 1975 merely states that if for example you are
the depositor of certificates or bonds bearing interests,
it is not only that which are going to deposit. Instead,
you are also obliged to collect. The principal or any
interest thereon. In this particular instance you take
note of the case of Agro Industrial Development
Corporation v. CA. This talks about interest earning
instruments.
Article 1976 talks about commingling. If it is allowed
that you commingle the objects deposited to you, you
can do that provided that they have the same kind and
quality and it will result in proportional co-ownership.
And when you say proportional co-ownership, you
don’t divide it equally. It should be divided in
accordance with the proportion that has been made.
This is usually true in warehouses. In warehouses,
sometimes if there is a necessity they would
commingle the grains so long as yung bigas ay type A
na bigas, icoco-mingle mo din yan sa type A na bigas.
Hindi mo pwedeng icommingle yan to a rice which is of
inferior quality. That is not allowed. But if they are of
the same quality, it could be done and there is also
proportional co-ownership. Kapag hinati mo yan, it
must not be divided, it should be proportional. For
example, yung property ni A ay ¼ lang. Yung property
ni B, yun yung ¾. Pag pinaghalo mo yan pagbalik nyan,
kay A yung ibibigay mo lang ay ¼, kay B ay ¾.
Notwithstanding the term co-ownership, it does not
connote equal division. Take note of that.
In Article 1977, you take note that the real purpose of
deposit is safekeeping. Therefore, he could not make
use of the thing deposited unless there is an express
permission of the depositor. It could not be implied, it
must be express. Meaning, pinagamit niya talaga sayo
in express terms. Kung tutuusin, pwede mong sabihin
na isulat niya yan in writing para may ebidensya ka na
pinapagamit sayo yung thing deposited. It could not be
implied. You take note again that the permission shall
not be presumed as enunciated in Article 1978.
Article 1978 contemplates irregular deposit. Here, the
right to use the property which is placed in deposit or
given by way of deposit, has been expressly given to
the depositary. In which case, the contract loses the
concept of deposit and becomes loan or a
commodatum. It depends whether it is a movable
property or an immovable, except for the safekeeping
of course is still the principal purpose of the contract. I
repeat, the permission should not be presumed, it
should be in express terms. This is considered as an
irregular deposit. Reason? Here the depository can
make use of the thing which is a deviation from the real
purpose of deposit which is just safekeeping. That is
the reason why your book would say that it is an
irregular deposit because it is a deviation of the
purpose for which a deposit is constituted.
Brito 0:17:01 to 0:25:30
Judge Hidalgo: …In the case of Javellana v. Lim, the
SC emphasize that if the thing deposited is
consumable, then the contract is simple loan unless
safekeeping is still the primary purpose. While if the
thing deposited is unconscionable or non-consumable,
it is commodatum. It all depends on the object that is
being deposited. Take note of that. Also, take note of
the distinction between irregular deposit from loan.
Apart from the object, in IRREGULAR DEPOSIT,
consumable thing may be demanded. Unlike in loan,
the lender is bound by whatever is agreed upon in the
contract. He could not ask for the return or for payment
as the case may be until it is due and demandable.
In IRREGULAR DEPOSIT, the benefit accrues to the
depositor. Why? Because in the ordinary course of
things it is the depositor who is benefited in the regular
deposit because depositary can make use of the thing.
The depositor is still the owner of the thing. The
depositary merely safekeeps it and use it if its
necessary to maintain the usefulness of the thing.
While in loan, the essential cause is the necessity of
the borrower. A loan with a stipulation to pay interest is
actually for the benefit of both parties.
In IRREGULAR DEPOSIT, the depositor has
preference over all the creditors with respect to the
things deposited. Later on when we will be going to
concurrence of credit, you would know na ang tao na
may maraming utang kulang ang property na ibabayad
nya sa napakadami nyang utang, may mga utang na
unang babayaran. May mga preference. May
preferential utang. Ano ba yung mga utang na unang
dapat bayaran at ano yung mga last na dapat bayaran.
May first preference at second preference. But that
happens only of course when the debtor has so much
utang but it has no sufficient amount to pay. If you are
going to compare to deposit, it means that depositary
has so many things held by him by way of deposit. So
ano ang una niyang ibabalik.
While in loan, the common creditors enjoy of no
preference in the distribution of the debtors property.
So he has no preference. So in other words, in loan,
ang mangyayari nyan ay proportionate payment.
So in ARTICLE 1979: The depositary is liable for the
loss of the thing through a fortuitous event. AGAIN, this
is the exception. In Obligations and Contract, if a thing
is loss in the ordinary course of things, the debtor is no
longer liable. Especially if it is through fortuitous event,
those events which cannot be foreseen or even if
foreseen it cannot be prevented already. Inevitable.
That they will be happening.
Now, here in 1979, express term said the depositary is
liable in the thing deposited even if its through
fortuitous event, however, several condition should be
present for this particular article, so the first one is (1)
If it is so stipulated. So if they agreed if nawala mo yang
relo na yan dahil nanakaw or dahil bumagyo,
babayaran mo pa rin yang relo nayan dahil. So there’s
an express stipulation that in case of loss, the
depository is still liable. The next one, (2) If he uses the
thing without the depositor’s permission. General rule
is, the depositary cannot make use of the thing. If he
makes use of the thing without the permission of the
depositor, if that thing is lost through fortuitous event
he is still liable. So the is (3) If he delays its return. In
the ordinary course of things, you agreed on when it
will be returned. Example, it will be returned today
(March 25, 2021) and you failed to return it and the
following day there is baha, bagyo at nawala ang item
deposited, in this case you will become liable because
you incur delay. The last one is (4) If he allows others
to use it, even though he himself may have been
authorized to use the same. Remember again, sya
lang ang inauthorize na gumamit. If the latter would
authorize somebody to make use of the thing which is
without the permission of the depositor, he is liable for
the loss of the thing in case its lost through fortuitous
event. This is premise on the fact that again permission
is given to the depository but not any other else.
Permission is not presumed, it is always express. Take
note of this article because it is an exception to the
general rule.
In Article 1980, it talks about Fixed, savings, and
current deposits of money in banks and similar
institutions shall be governed by the provisions
concerning simple loan.
In the case of People v. Ong, the court reiterated and
emphasized that the relation between the bank and
depositor is a debtor and creditor relationship. Because
banks are allowed to use the money deposited. That is
not new to you. I’ve been reiterating that from the very
start.
In the case of Equitable PCI bank v. Ng Sheung Ngor,
I gave that in the syllabus, it answers the question: is
the bank allowed to compensate or set off the deposit
in its possession for the payment of any indebtedness
to it on the part of the depositor. In other words, in
deposit, is “kwits'' allowed? Eh may utang ka sa akin,
pero may dineposit ka rin saken. Ex: if a particular
person deposited 100,000 in the bank, yet, he also
incurs 100,000 loan from the bank. If he will not be able
to pay the 100,000, can it be compensated? This is a
bank. Not pure deposit in real sense. The SC said YES.
Because the relationship of the party is of a debtor-
creditor. This is even so deposited banks are governed
by contract between the parties. In other words, bank
deposits are not true deposits within the contemplation
of the law. Since the depositor is expected to get the
same or identical money deposited.
Buencamino 0:25:31 to 0:34:00
Since Depositor is not expected to get the same or
identical money deposited.
The ruling in the case of Equitable PCI bank has
been reiterated in the case of Gullas vs PNB, the ruling
in Equitable PCI is reather very xxx complicated case,
although it boils down in this very simple ruling which
merely says that there is compensation in deposit.
There is compensation, iquiquits siya, magtataka kayo
later on kung anon nangyari pag meron kang bank
deposit at nag loan ka rin sa banko nay an tapos hindi
mo nabyaran yung loan mo na yan. Pwede nila
icompensate or iset off yung bank deposit mo.
So, lesson, if you have deposit with one bank, you
obtain a mortgage or a loan from another bank, DON’T
make it in the same bank, otherwise, there might be
some compensation.
Also this ruling has been reiterated in the case of PDIC
vs CA and Abad, that is also reiterated in that case.
Now in the case of Serrana vs Central Bank, it talks
about distressed banks. So what action may be filed in
order to recover time deposits in a distressed bank.
ALAM NIYO YAN. In the 90s or early years of 2000
maraming bangko ang nadistress o nabankrupt, kaya
nga nag merge sila, there were mergers of banks, so
dating Equitable, o metrobank ba yang ka kwan niya,
so maraming ganyan (mergers or distressed banks?).
So what is your recourse if you are a depositor in a
distressed bank?
SO, since this is NOT a true deposit, in the real sense
of the word, the cause of action to recover from that
bank is an ORDINARY COLLECTION SUIT. BUT
remember, under the PDIC rules, the ceiling, the most
amount which you can get only which is “insured and
assured” by the PDIC is only 500,000.
So kahit na 5M ang deposit mo, pag nabankrupt yang
bangkong yan ay ang makukuha mo lamang ay 500k.
LESSON: don’t deposit too much ( banks: edi don’t >:|
). If you have a lot of money you depost it to different
banks. Don’t deposit 5M in one bank. Pag nabankrupt
yang bangkong yan maloloka ka, kasi 500k lang ang
marecover mo.
Take note: hindi pa ganyan kadali ha, its either you ah,
intervene in the liquidation process whshawhsh which
is very very inticate because you are not the only
depositor. OR you file an action for collection. It
CANNOT be mandamus or prohibition. You could not
be suing the distressed bank for it to return the deposit.
Anyway, this is a higher financial transactions, Im just
telling you that since bank deposit is not really “true
deposits”, once there is bankruptcy on the bank where
you deposited your money. Your cause of actions is
merely COLLECTION, and as per PDIC rule the
amount which is guaranteed is 500,000.
So Art 1981, any question? Am I too fast or alright?
Girl law student: mam, I have a question but its about
Art. The one where there is commingling (art. 1976). Is
expiration date taken into account in commingling
when it is the same kind and quality?
J. Hidalgo: what do you mean by expiration date?
Girl Law Student: for example there are grains whose
expiration date is on January 2021 and the other one
is on December 2021, do those grains fall (cut by J.
Hidalgo)
J. Hidalgo: taken into consideration, so you mean to
say can they be commingled? Even if they have
different expiration dates?
Answer: you know, commingling is only good for
warehouses, where the warehouseman has to take
into consideration the expiry dates. BUT in the ordinary
course of things ;) so long as the division of the
property or the return or the delivery of the property
deposited is prior to the expiration, then in which case
the expiration does not really matter. REMEMBER that
you are storing your goods. In fact, the warehouseman
is acutally warned not to be commingling. ACTUALLY,
di naman yan nangyayari oftentimes, pero kunwari,
kulang yung bodega kaya kailangan I comingle nila,
but of course ha commingling is with permission of the
depositors. You could not do that on your own.
UNLESS there is an agreement na pwede kasi if you
can do that on your own (that is, without permission)
and the expiration becomes an issue, and na
commingle yung expired at hindi expired, the
warehouseman will be very much liable, including the
depositary. Because the warehouseman in that
particular case is the depositary.
Ang ineemphasize lang sa commingling actually is not
the expiration of the products. Ang ineemphasize lang
ay it should be of the same quality, it is NOT even
quantity because it results in an inproportionate
ownership (or co-ownership?) as the case may be. So
yung lang quality. Hindi yung quantity.
O ngayon, pwede mo ba pagmixin ang brown sugar at
white sugar? hindi pwede yan db, dapat brown sugar
brown sugar din, white sugar white sugar din.
Otherwise, anog result nyan? Brown at white sugar
magiging dominant dyan yung brown, PANGET NA.
kaya ang ineemphasize lang sa commingling acatually
is the quality.
But in case there will be expirations, then that is the
look out of the warehouseman. He must see to it that
that object will be delivered, ihhh iihhhh iiihhh iiih iiihh
ihiiiii iassure niya that it will be delivered to the recipient
before the object expires.
So is there a case that ruled on that Ms. Dungo? (siya
ba si girl law student?): none that I read po
J. Hidalgo: wala, wala :) (with matching ngisi o tawa)
wala pa. So this is an example of a hypotethical
question which needs an application and for a further
understanding of……… anymore question?
Probaby beadle: wala na po ata Justice
J. Hidalgo: ok Art. 1981 let me call on the lucky persons
to recite, Tumboon etc.
Dariagan 0:34:01 to 0:42:30
JH: What does Art. 1981 provide:
S: It provides for when the deposit is closed and sealed
then the depositary must return it in the same condition
and that he shall be liable for damages if the seal or
lock is broken.
JH: What is the reason why it’s broken? Don’t forget
that word.
S: Through the fault of the depositary.
JH: Don’t forget “through the fault.” It could not be
through a fortuitous event or any other’s fault. It must
be the fault of the depositary. When you say fault,
again. Whose fault is it?
S: The depositary po, Justice.
JH: And what if for example it is opened. So how will
you now know the liability of the depositary?
S: When the seal is broken, if it is not without the fault,
it will depend on the value of the thing that was inside
of the deposit ma’am.
JH: That is when there is a stipulation that the thing
inside is valued, okay? What if it was just a sealed
deposit? It wasn’t even said what was inside it nor the
value. What is now the rule on the matter?
S: In that case the depositary should keep it as….
JH: No, I’m talking about the liability. I’m not talking
about the keeping of secrets of the contents. So for
example the depositor would say “oh, that thing inside
it is worth 10k” Okay, is the depositary whose fault or
is at fault at the opening of the sealed deposit obliged
to pay 10k?
S: Yes, ma’am. He will pay the 10k plus damages.
JH: Plus damages - that is if in the first place the
depositary is determined to be the one at fault. What
about if he is not at fault? It was caused through a
fortuitous event.
S: Then he will return the thing deposited.
JH: What if the depositor refuses? And seized on the
value of 10k?
S: Then the person may go to court.
JH: And? What will he do in court? Who will go to
court? The depositor or the depositary?
S: The depositary.
JH: Ano gagawin niya don? Anong sasabihin niya
doon? Are you sure the depositary would go to the
court? And ask the depositor to pay? Or is it the
depositor, the one going to the court? And ask this
amount shall be paid.
S: The depositor will go to court and ask for the amount
to be paid.
JH: And ask for the amount to be paid and he must be
ready to accept whatever amount given by the court?
S: Yes.
JH: Yes? Talaga? Do you agree, Mr. Martin?
M: In that situation the depositor, it said on the third
paragraph of Art. 1981, with regard to the value of the
thing deposited, the court can take into account the
statement of the depositor stating the value of the thing
deposited and the depositary has the burden of proof
to…
Dizon 0:42:31 to 0:51:00
Student: The depositary has the burden to prove that
the seal was broken without his fault, because there is
a presumption it is through his fault that’s why the lock
or the seal was broken.
Justice: In other words, it is the depositor’s act which
will determine what is to be done next. Only in the part
of the court, if the depositor says it is something like
this or it is worth like this, of course the court is not
obliged or compelled to be ruling in favor of the amount
the depositor will be declaring. It has to take into
consideration the credibility of the depositor. If he says
things which are too high, then the court can determine
or give an amount which is, whether the depositor
accepts it, it’s upon the discretion of the court.
Take note, once a sealed deposit is given to the
depositary, it cannot be opened. It has to remain that
way. Because if it is opened, especially so if it is forcibly
opened, the presumption is that the depositary was the
one who opened it. Unless, of course, the contrary is
proven. In other words, what are the obligations of the
depositary in this case?
Student: In this case, the depositary has 3 obligations:
1) He should return the deposited thing in the same
condition in which it was deposited; 2) if the lock or seal
is broken, he would pay for the damages; and 3) if the
seal or lock is broken and he saw the contents of the
deposit, he should keep in secret what was inside the
deposit.
Justice: Why? What is the reason why the law
imposes these 3 particular obligations?
Student: This is because of the trust or confidence in
which the depositor took into account when he chose
the depositary for this deposit.
Justice: Okay. But this is a general rule. Is there an
exception also? Where even if it is a sealed deposit
which was given, the depositary can open it?
Student: There are two instances where the
depositary can open the seal or lock of the deposited
object: 1) If there is presumed authority or 2) there is
necessity. In presumed authority, in this situation,
where, if it is a box which is locked, the key is given to
the depositary, and there is a presumed authority that
he can open the deposited object while in necessity is
when the depositor will give instructions to the
depositary, in which the instructions cannot be done by
the depositary unless he opens and does the
instructions of the depositor.
Justice: Or gives authority, right? As provided for
under Art. 1982. It’s very clear. There are 3 obligations
on the part of the depositary once a sealed deposit has
been forcibly opened. Take note of the presumption.
Although this is a general rule, there are two
exceptions as exemplified under Art. 1982.
Now, when you say the thing deposited will be returned
with all its products, accessories, and accessions, what
kind of things are being deposited in this situation?
Student: An object that produces fruits?
Justice: Ano pa? Those with accessories? And what
about accession?
Justice: Susceptible of increasing or to be increased
both in quantity or quality. Take note of that. If what
was deposited to you is a dog, dogs give birth, if you
give back the dog, you include the puppies. When was
it deposited to you is a car, and that car has so many
accessories, say with mug lifts (?), kung ano anong
mga accessories, ibalik mo yan as it is. When what was
deposited to you is land, pwede ba? Immoveable
property, can that be deposited to you?
Student: Extrajudicial deposit.
Justice: Pag judicial deposit, ang court ang depositary
diyan eh. Give an example of accession.
Student: For example, you were given a computer.
The principal is the computer and monitor itself.
Accessories are things which are needed to make use
of the principal. Examples are a keyboard and a
mouse. You cannot use a computer without a keyboard
and a mouse.
But with accessions, these are objects which are not
necessary for the use of the principal so for example
the headphones or speakers.
Justice: Whoever told you that accessions are not
necessary?
Student: They are only for the perfection of the
deposit.
Justice: Pwede naman for the beautification, diba?
Yung sa accessories din diba? Give me an example of
a deposit na magkakaron ng accession. Differentiate it
from accessory.
Student: Accessories are those things which are used
to complete or which the principal object cannot be
used without its accessories.
Ferriols 0:51:01 to 0:59:30
S: Accessories are those things which are used to
complete or in which the principal object cannot be
used without its accessories comparing to accessions
which are used to perfect the principal in which…
JH: To perfect? Or to complete. To perfect? Kasi
naman yung libro nyo hindi dinistinguish kung ano
yung accession tsaka accessories di ba? O
dinistinguish mo lang, ayan. May mga authors who
distinguishes it. Ano ba? O Mr. Tiangson what’s the
distinction between accessory and an accession?
S: An accession is anything attached to the principal
object while accessory is uhm, something that is
necessary for the use or preservation of the principal
object. So if for example, the principal object is a car,
then an accession of that would be the cup holder
because it is not used for the preservation of the car
while an accessory would be the steering wheel
because without it, it can never be used.
JH: *natawa* ganon? Bakit pag bumili ka ng kotse, “ay
ma’am kakasama na po yung accessory dyan” ang
binibigay na accessory ay yung jack, diba, yung kung
ano ano yung binibigay di naman yung steering wheel
also the principal object, hindi naman accessory yun
S: Ma’am may I change my accessory example? An
example of the accessory would be “key” because
without the key then you would no longer use the car
JH: ah ganon? Actually, ganon? Ang accessory ba is
something very useful, without which the object will not
be used?
S: Yes ma’am, or its necessary for its preservation
JH:preservation and used? Or preservation only?
S: it can be either, either ma’am
JH: is that what the law said?
S: it can be for either preservation or for use
JH: and accession is? So in other words, lets make this
clear. Accessory is something important?
S: Yes.
JH: while accession is?
S: accession is something that is attached to the thing
but it is not necessary for its preservation or use
JH: Therefore, yung mga lights na magaganda,
accession lang yun?
S: Yes, justice
JH: Talaga? Sino nagsabi nyan?
JH: You know why you have a hard time answering it?
Because under the law on property, yang word na
accession na yan, ang daming definition diba? It could
be addition, okay to a particular object okay, or it can
be something attached, okay? The value or the
quantity of that particular object, that’s the reason you
have a hard time distinguishing accessories and
accession. That’s the reason why the law says
accessories and accessions. But it could be accepted
that when you say accessories, so these are really
very important because without which hindi complete
yung object. Where accessions are those which may
be added, to add value to the object, or to beautify it.
So just the same, if you are, if a thing is deposited to
you coupled with a both accessories and there are
also things there which may be added that are to make
it beautiful, then all of these may be returned, as it is. It
must be returned, as it is. Okay? As it is.together with
its accessions and accessories, okay? Now, you just
take note of that as a general rule, so this applies also
to earnest money, where the sale did not push through.
Maybe you’re wondering, what is earnest money there,
in your book, when you say earnest money, that is
something, it is an advance purchase price. So for
example you are buying a house and lot, and you gave
an earnest money of 100,000, okay, that 100,000 is
already placed in the bank, okay, 1 year have passed,
the sale did not push through, okay? So in the mean
time the money deposited in the bank has an interest,
for example 100 pesos. So what is to be returned to the
seller, because, to the buyer i should say, because the
sale did not push through would be not only the
100,000 but also the interest of 1000 pesos. Therefore
101,000 pesos will be returned. Can you understand?
That is the meaning of earnest money. Okay? Art.
1984, still with you, Mr. Tiangson. It talks about
estoppel right? So in the contract of deposit, who is
estopped from questioning the credibility of one or
ownership of one or the other?
S: The depositary
JH: The depositary is what? Complete it
S: the depositary cannot demand that the depositor
prove the ownership of the thing subject of the deposit
JH: Why?
S: Because…
JH: Bakit pag ako di ko pede tanungin “oh etong
pinapatago mo sakin kanino to, sayo ba talaga to?” i
cannot?
S: Because, depositing of a thing cannot require
ownership of the said thing.
JH: and so therefore, what is enough is that?
S: possession and control
JH: Possession and Control, and so in other words, he
has the right to possess the property and the right to
convey. Can you understand?
S: Yes, ma’am
JH: to convey? Did you understand my word, to
convey? Kulang yon diba, o sige continue
S: He cannot disposed of the thing, but he may deposit
it since deposit does not require ownership but
disposal does require ownership
JH: meaning, he can transfer the thing deposited to a
depositary, so he can have it that and because he has
the right to transfer but not the ownership thereof. so ,
for example, pinatago ko sayo yung rolex watch ko, you
can presume that i am the owner.
S: Yes ma’am
JH: are you sure?
JH: Are you sure? Bat parang di ka alanganin, nag yes
ka sakin eh.
S: No. because, as i said before, depositing a thing
does not require ownership.
JH: No, iba yung require, ang tinatanong ko sayo ay
presume. So if i for example has a rolex watch and i tell
you, you keep this rolex, rolex watch, can you presume
that i am the owner of the same?
S: Yes.
JH: Yes? The fact that i am in possession of the same,
the presumption tho debatable or disputable can be
made. Eh nasa akin eh, diba akin, diba? And i have the
right to disposed kasi nga binibigay ko sayo. Pero yung
ownership hindi mo presumption lang yun, diba? Its
just a presumption. So in other words, it is enough that
the depositor is in possession of the property and has
the right to disposed.
Javier 0:59:31 to 1:08:00
JH: The fact I am in possession of the sale, the
presumption though debatable/disputable can (??)
And I have the right to dispose kasi binibigay ko sayo
pero yung ownership; presumption lang yun; Its just a
presumption. In other words it is enough that the
depositor is in possession of the property and has the
right to use it.
JH: Dispose in a sense na temporary ang dispassion.
Safekeeping lang yun e and that could be presumed
but it is debatable because it is subject to the proof
ownership, although you cannot question the
ownership there is an estoppel so the depositor is
estopped from questioning whether or not the
depositor is the owner of the property. It is enough that
he is in possession and he disposes the same
momentarily or for safe keeping purposes.
JH:What if for example later it was discovered that
the thing that was deposited to you isn’t actually
owned by the depositor? What do you do?
S:The depositary’s obligation to inform the true
owner shall arise and this informing is for the
benefit of the depositary because if the depositor
the co-owner would not claim the key subject of
deposit within 30 days then the depositary would
be relieved of all liabilities of the thing subject to/of
the deposit
JH:To Whom?
S:To the Depositor;
JH: does it apply to all situation(s) when somebody
is claiming abode of the property?
S: Yes to all those; if the depository has the
knowledge that the thing subject was subject of
theft
JH:: Is it Applicable to lost and found items ?
S: No, it does not apply because in Lost and Found
items because the true owner of the thing is not yet
identified and so the depositaries’ obligation to
inform the true owner shall arise because the true
identity of the owner is still unknown and so
therefore this applies in situations which are where
the it is actually stolen but not to lost and found
items.
JH: Now you TAKE NOTE of this particular
provision of the law. You take note that this does
not apply to lost and found items it applies only to
STOLEN items; Take note when there is no owner
who is claiming it but of course but if you are the
depositor which is not enough that he gets to claim
the same as his own. You have to demand the proof
of ownership.
JH:Okay after Article 1985 there are two situations
covered here before we cover the situations can
you tell me what is Article 1985?
S: When there are two or more depositors, if they
are not solidary, and the thing admits of division,
each one cannot demand more than his share
JH: When you say when they are not solidary what
do you mean by that?
S:: They are joint; In joint only the part or the share
of the depositor can only claim and demand his/her
part of the deposit not the whole thing
JH: Give me an example of Paragraph no.1
S: An example of the first situation where on two or
more depositors deposited a tray of eggs and in
this example they own 50% of the tray each and
then the depositor can only claim his/her part or
50% of the eggs in the tray
JH: What is the 50% of the eggs in the tray (12
pieces of egg in a tray)?
Liban 1:08:01 to 1:16.30
JH: So, what kind of thing is deposited here? To apply
this first paragraph (Art. 1985) what kind of thing is
supposed to be deposited?
S: The thing should be divisible.
JH: Okay, yung trays of egg consisting of 30 eggs is
actually divisible. Right?
S: Yes.
JH: And then?
S: Then the depositor can only claim or demand his or
her share which is 15 eggs.
JH: Are you sure na ang share ng one is 15?
S: Yes po, because in my example, there are only two
depositors.
JH: Are you sure, that when there are only 2 depositors
the presumption is that equal division? Yun ba ang
tinuro sa inyo sa oblicon?
‘Di ba it is only in the absence of any agreement as
to how much is the share of the parties where you
can presume equal division, right? Yun ang general
rule, correct?
S: Yes po.
JH: Even the provision itself it states: “each one cannot
demand more than his share” and therefore it warns
you that there are proportions, hindi lang equal. So in
the absence of any stipulation, “ok sige, not more than
one half”, which is a different situation in paragaraph
number 2. Why ? What is provided for in par. 2 (of Art.
1985)?
S: Under the second paragraph, the depositors are
solidary and the thing deposited is indivisible.
JH: And what is the rule here?
S: The general rule is that any of the depositors can
demand or claim the whole from the depositary. And
the exception is when there is a stipulation of which
depositor can demand or claim, and in such case, he
is the only depositor who can claim from the depositary.
JH: repeat your answer, you missed something. Ganun
ba automatic na ganon? You can demand the return of
the thing, unless there is somebody who is
designated?
S: Yes.
JH: Hindi ba, you can demand the return of the thing.
So anyone of them make the demand for the return of
the thing. Ok? So the depository for his part he can give
it to anyone, kas inga solidary sila. Right? The first
unless is, “Unless one of them demands the return”.
Now, if one of them demands the return of the thing, is
he liable to return that thing to the person who
demanded?
S: yes.
JH: Sure??
S: As a general rule po, yes. One depositor may
demand the thing from the depositary, unless there is
a designated depositor who must make the demand.
JH: therefore tatlong rules yan diba? So when the
object is indivisible and the depositors are solidarily
bound to each other: there are 3 rules there. You only
stated two.
The first rule is, the depository may return the object
to anyone of the depositors, consistent with the rule on
Obligations and Contracts. The first exception is,
unless one makes a demand, in which case, it will be
returned to him. So if anyone of them makes a demand,
return it to him, it’s up to anyone of them. The
exception to the exception is, if there is a designated
depositor to whom the object will be returned, in which
case, it will be returned to him.
Don’t forget these 3 rules. So it’s not just a matter of
simply giving back to anyone of them, unless one of
them demands. Kasi meron pang isa. Be warned, what
if one is designated pala. You could not return to the
person who demanded it. It should be returned to the
person who is designated. Take note. Be very careful.
Take note of this Art.1985. Another very important
provision in the Law of Deposit. Take note of the two
situations, and the discussion.
Now, What is Art. 1986?
S: Art. 1986 talks about a situation where the depositor
loses his capacity to contract after having made the
deposit. The depositary cannot return the thing to the
depositor, but only to the persons who may have the
administration of property and rights of the depositor.
JH: Is it possible that you lose your capacity to enter
into a contract along the way? Can you give an
example of this.
S: In case of insanity. If the depositor was capacitated
to contract prior to him being insane. Then during the
pendency of the contract of deposit, the depositor may
use his capacity to contract.
JH: Ganon? Ang insanity ba, hindi inborn? There are
times where you were once sane, then you became
insane?
S: Yes po.
JH: So, what are the instances when one becomes
insane? At this point of your life Mr. Vicente, are you
sane? Is there a possibility that you will become
insane? What might make you become insane?
Macalinao 1:16:31 to 1:25:00
JH: Is there a possibility that you will become insane?
A: In case my insanity comes later in life.
JH: Ay no. Kahit ngayon you can be insane. Even if you
are young, there is a possibility that you will become
insane. Kaya nga tinatanong ko. What can make you
insane?
A: Brain damage from blunt force or trauma.
JH: Huh? Insanity yun? That can make you insane?
Nothing can make me insane. Sabihin mo nga. Do you
have a girlfriend? What if your girlfriend finds another
man? That will not make you insane?
A: I don’t think so.
JH: What will that make you if di ka magiging insane?
What if for example that made you insane?
A: Drug addiction. The substance will… drugs might
affect the…
JH: Does taking drugs make you insane?
A: Certain drugs.
JH: Like what?
A: Methamphetamine. Sorry Justice, I really don’t know
what drugs would make me insane.
JH: It will make you lose your senses, but insanity? I
am not convinced. In my years of hearing cases on
drugs, when I was still a judge, wala pa akong alam na
nabaliw dyan. Heartbreak, madaming naiinsane dyan.
Stress. Shock. Should you, an insane person, deposit
your thing to A , what is your recourse on the matter?
A: The thing should be returned to the persons who
may have administration over the property.
JH: Like?
A: His heirs.
JH: Heirs lang ba? Di pa naman sya patay.
A: Any person designated on the contract of deposit.
JH: How about the insane person? Can he not return
it? Is it possible to return the thing to the insane
person?
A: It is possible to return the thing to the depositor
himself, provided that he is.. He becomes capacitated
again.
JH: Pano yun? Pag lokaloka ka magiging capacitated
ka again? Common sense lang yan.
A: Yes
JH: Are you familiar with the lucid interval?
A: Yes.
JH: Are you in your lucid interval now?
A: No, because I am not insane.
JH: Lucid interval is the temporary sanity of the mind.
You are insane, you become capacitated again. That
is lucid interval. But you see, Mr. Vicente, Article 1986
talks about the capacity of the depositor to contract,
and that is not only insanity. The moment that you are
no longer capable of entering a contract. Yung return it
to the depositor himself, yan yung mga lucid interval.
Can you understand? So you take note of the general
rule here. The thing should be returned to the
depositor, heirs or successors, or persons in the
contract with the exception of, when the depositor
becomes incapacitated, it shall not be returned to him
but instead to his guardian, administrator, or himself,
should he become capacitated again.
Art 1987 we will not be talking about this anymore
because it merely talks about the place of return. Of
course, at the expense of the depositor.
Manaloto 1:25:01 to 1:33:30
JH: So it could be remitted to that effect then it should
be returned to the place where it was agreed upon.
Okay? Of course at the expense of the depositor
because he is the one benefited.
If none, the thing may be returned at the time it shall be
returned and need not be in the place where it was
deposited. Again, at the expense of the depositor.
JH: Art 1988, Ms. ST, what does Art 1988 provide?
T: Art. 1988 provides that the thing that is deposited
must be returned to the depositor upon demand even
though a specified period or time for such return may
have been fixed.
JH: Why upon demand kung may pinagusapan naman
kung kailan ibabalik?
T: Because the depositor is still the owner of the thing,
or has the right of possession of the thing, however, he
only entrusted the thing to the depositary for the
purpose of safekeeping. Therefore, he has the right to
demand the thing at will.
JH: Is there an exception to this general rule?
T: Par 2 of the same article provides that the provision
will not apply if the thing is judicially attached while in
the depositary’s possession, or if he should have been
notified of the opposition of a third person to the return
or the removal of the thing deposited.
JH: so it talks of judicial deposited thing and there’s
opposition. Until after it has been resolved then that’s
the only time it shall be returned to the person who
demands or the depositor himself, as the case may
be.
Okay, what about on the part of the depositor? Can he
return it just the same? Even if it’s not demanded by
the depositor?
T: No, ma’am. On the part of the depositary, he must
return the thing on the time stipulated in the contract.
JH: And that applies to both gratuitous deposit and
even those deposits with compensation?
T: No, ma’am. For gratuitous deposit, the depositary
need not consider the period fixed if there are justifiable
reasons for his return.
However, if the deposit is made with valuable
consideration, then the depositary has no right to return
before the period stipulated in the contract
JH: He is obliged to comply with the designated date.
What about if for example, the depositor does not want
to accept the thing? Sabi niya “no no no, it is still to be
deposited with you?” What is the recourse of the
depositor?
T: The recourse of the depositor is to make or create
another contract of deposit
JH: To whom?
T: To the same depositary if he accepts. But if the
depositary does not agree, then the depositor has the
option to receive/accept or make another deposit to
another depositary.
JH: I’m not talking about the creation of another
contract of deposit. What if for example the depositary
said “ok I’m returning the thing deposited” and there’s
a justifiable reason, the depositor does not want to
accept. Sabi niya, “ayoko nga, di pa naman tapos ang
period eh. And besides, I’m paying you for that.” Is
there any recourse on the part of the depositary
*inaudible* to get rid of the thing because he has a
justifiable reason in withdrawing from the deposit?
T: if for justifiable reasons, he can no longer be liable
for the safekeeping of the thing. He may ask the
depositor to deposit the thing to a third person
JH: Eh ayaw niya? Sabi niya “no, no, no, it should be
you”
T: since the deposit can only be returned before the
time stipulated if it is gratuitous then the depositor has
to accept the thing.
JH: ayaw nga niya eh, sirain nalang niya ganon?
T: Then if the depositary has notified the depositor that
he is unable to safekeep the thing then the depositor
becomes liable for the thing deposited, ma’am.
JH: Are you familiar with the term consignation? If the
depositor refuses to accept when the depositary
returns the thing for justifiable reasons, then in order to
get rid of his obligation to keep the thing, he can have
it consigned or deposited to the court. In which case
the term is consignation
Consignation is the act of depositing the things due at
the disposal of judicial authorities. Remember that this
can only be done for justifiable reasons.
Tender of payment is the act of offering payment. So
you give payment. And consignation, if he refuses to
accept, you go to the court and have it deposited with
the court. That is consignation.
JH: 1990, Ms. D, talks about the obligations of a
depositary. And what is the obligation of the depositary
in this particular instance?
D: He is liable for loss by force majure of
government order.
JH: Defined as?
D: Force majure is defined as events and
circumstances where the depositary has no control
over.
JH: What are the 2 kinds of force majure? Acts of god
and acts of man.
Okay, so when the thing is lost through a fortuitous
event or government order. Fortuitous events are all
events which cannot be foreseen or even if foreseen is
inevitable.
What do you mean when you say by government
order?
Maramag 1:33:31 to 1:39:21 (end of part 1) to 0:03:00
(part 2)"
D: Government order… it is when the government in
order to uphold public welfare takes or uses the thing
for just compensation.
JH: And you call that what?
JH: In the exercise of the power of eminent domain.
Remember that again.
D: I was thinking about police power.
JH: Iba ang police power, the power to regulate. You
take note of that.
You take note of the obligations of the depositary, in
the article 1990 if the depositary loses the thing by
force majeure or Government order. If the depositary
loses the thing and receives money. He shall deliver
the same to the depositor. So in the event the
government will take, kapag kinukuha ng government
ang immovable property in the exercise of eminent
domain. If that happens, then the depositary would be
returning the just compensation given by the
government as compensation, as the case may be.
JH: Mr. Timbocol, Article 1991 talks about the
obligation of depositor’s heir meaning the depositor is
already dead, the thing is already at the disposal of the
depositor’s heir. What is the rule regarding that matter?
T: Article 1991 states that if in good faith the heir sells
the object, the heir has the obligation to..
JH: Ay hindi niya yan sinasabi ah, pag sinabi mong
1991, dapat verbatim ka, otherwise gagawin kitang
congressman.
T: Article 1991 deals with a situation where the heir
sells the object of the deposit, the heir has the
obligation to return the price received for the object of
the deposit and he or she is bound to assign the right
of action against the buyer in case the price is not paid.
JH: In this particular instance, the object, which is the
object of the deposit, in whose possession?
T: In the possession of the heir, because the depositary
is presumed to be already dead.
JH: Akala niya pamana niya, yun pala thing deposited.
The act of the heir is it in good faith or bad faith? In the
object of the deposit?
T: Article 1991 deals with the heir in good faith.
JH: In good faith. Does it apply to a situation where the
heir is bad faith? Meaning he knows fully well that the
thing is deposited to his ancestor and disposes the
thing?
T: No po. If the heir acted with bad faith, the heir is
liable.
JH: The heir is liable at the disposal of the thing (if bad
faith). Take note of this article 1991 when the
depositor’s heir is the one who is in the possession of
the property and sold the same without knowing that it
is a deposited thing, the heir shall be bound to return
the price he may have disposed of or assigned against
the buyer. He must return the price. This applies to
disposition in good faith but not in bad faith. What he
will be assigning is the right to collect if the price is not
yet paid.
This is a provision of law based on common sense. We
have to take a short break.
JH: You take note of the article 1991, there’s nothing
hard here. Let’s now go to the obligations of the
depositor.
T: The article 1992 states that if the deposit is
gratuitous, the depositor is obliged to reimburse the
depositary for the expenses he may have incurred with
regards to the preservation of the thing po.
JH: With regard. What if the deposit is for
compensation?
T: If the deposit is for compensation, then it is deemed
to be borne. They are deemed included in the
compensation.
JH: Is this precise?
T: If there is a contrary stipulation po for the depositary
to borne the compensation po then it is not applicable.
JH. It is not applicable. So are you saying that this
provision of law only applies to gratuitous?
Martinez 0:03:01 to 0:11:30
A: No, Justice. If there is a contrary stipulation, then the
depositary will not borne the expenses with regards to
the preservation.
JH: Actually, this particular provision of law applies only
to gratuitous deposit. Because if you notice it, the rule
if the deposit is for compensation whereby it says that
the expenses for preservation shall be borne by the
depositary because they are deemed included in the
compensation is something debatable. Because the
compensation only is for the act of deposit. It does not
talk about expenses. If binayaran ka because a thing
has been deposited with you - the payment is for the
act of safekeeping the thing; it does not talk about
expenses. Therefore, yung rule na it applies also to
compensation - very debatable. So, it is deemed
included in the compensation? I think this only applies
when there is a stipulation. Inclusive in the
compensation is whatever necessary expense that
may be incurred. Therefore, we interpret Art 1992, so
the general rule would be: it is applicable only to
gratuitous deposit. Basis: equity. Nalibre ka eh, di ba?
Therefore, wala namang binabayad sa’yo. It follows
that any expense for preservation of the thing must be
borne by the depositor, not by the depositary.
However, the authors of the law moved further by
making a distinction. The books would say, take note
of the distinction. If the deposit is gratuitous, the
depositor is obliged to reimburse the depositary for
expenses of preservation whether ordinary or
extraordinary because this is necessary for the
preservation of the thing and you should know that the
depositor is the owner of the property therefore
necessary expenses must be at his own expense.
Useful expenses however, or those for luxury and
pleasure, are not covered. Because in the first place,
they are not needed; it is just for luxury or for pleasure.
If the deposit is for compensation, the expenses for
preservation shall be borne by the depositary because
they are deemed included in the compensation - that
makes it debatable. But just the same, since that is how
it is interpreted by the civilists and by the authors then
it is also important that you know this. Although there
is no case yet which packs up this particular
assumption or premise insofar as deposit for
compensation is concerned.
Art 1993 talks about the obligation of the depositor to
reimburse the depositary for any loss due to the
character of the thing. When we say “character of the
thing”, what did it mean?
A: The thing would deteriorate through time. It deals
with the obligation to pay the losses incurred to the
deteriorative character of the said thing deposited.
JH: In the article itself, it says that unless at the time of
the constitution of the deposit, the former was not
aware of - you mean to say that he is not aware of the
possibility that the thing would deteriorate?
A: Yes. There’s a possibility that he is not aware.
JH: Is there a thing that will not deteriorate in the first
place?
A: I thought of diamonds.
JH: Ah, diamonds do not deteriorate?
A: Yes.
JH: It accumulates in price through the years.
A: Yes.
JH: Oo nga naman. It does not deteriorate. Or maybe,
it went on to say, was not expected to know the
dangerous character of the thing. Tulad ng plantsa,
ang uminit ay yung handle, ganun ba yon?
A: Yes, if the defect is hidden.
JH: Yes, because he was not aware, di ba?
A: Yes.
JH: Okay. So, nagkaron na naman ng exception ang
rule na to. So what is the general rule in applying Art
1993?
A: As a general rule, the depositary must be
reimbursed for the loss suffered by him because of the
character of the thing deposited.
JH: The exceptions are?
A: If the depositor is not aware with regards to the
dangerous character of the thing, for instance, the
given example, the iron or the plantsa in which the
handle is the one that will heat up instead of the iron
itself.
JH: You remember me for that example ha? Yung
handle yung uminit. Anyway, and then?
A: Another exception is, if the depositor notified the
depositary of the same, and another exception is, when
the depositary is aware of the said dangerous
character of the thing even without advice by the
depositor.
JH: So you take note of the rule here. The depositor
shall reimburse the depositary in case of loss due to
the dangerous character of the thing deposited.
Reason? Because he is the owner of the property.
Exception is that if he wasn’t aware of the character of
the character of the thing, the depositor is not expected
to know the said character, the depositor notified the
depositary of the character of the thing deposited
earlier on, and lastly, the depositary is aware of the
character of the thing deposited even without advice of
the depositor. Meaning, it is not hidden. Whatever
defect the thing has, it is not hidden. Otherwise, it is a
hidden defect, it will be an entirely different story. So
you take note of Art 1995.
Art 1994 obviously talks about pledge; it is akin to a
pledge. What does Art 1994 provide?
A: It provides that the depository may retain the thing
pledged until the full payment of what may be due to
him by reason of deposit.
JH: What is that which may be due to him?
Medina 0:11:31 to 0:20:00
Student: um…..based on the book of de leon, in
pledge, he mentioned article 2121 where a pledge is
created by operation of law… and uh, after the
payment of the debt and expenses, then the remainder
of the price is delivered to the depositor, ma’am.
JH:Would you agree with me that one of those due to
him are damages that might have caused him?
Student: yes ma’am..
JH:This right of retention, is this applicable or the same
rule as that of commodatum or mutuum?
Student: No it’s different ma’am.
JH: Why?
Student: Um, because in commodatum the depositary
is –
JH: teka teka ha, ang usapan commodatum tapos ang
sinasabi mo diyan-
JH: Ang depositary, kapag commodatum na, is the
bailee. Ang depositor yun yung bailor. Kasey yun yung
nagbibigay ng object diba? Like, the bailor is the one
who gives the object, right? And the bailee is the one
receiving the object. Therefore, the bailor is the
depositor and the bailee is the depositary Don’t forget
that okay?
So it’s not the same with commodatum because?
Student: 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..
JH: uhm, but is that again an absolute rule? Because
even in commodatum the bail-(cannot hear) – retain
the thing right?
Student: yes, um, the exception to that rule was that if
the bailee has the right of retention for damages?
JH: OKAY, that’s correct. And so therefore, this right of
retention here merely talks of reimbursement of what is
due him so therefore, in a contract of agency, this is
also a right of an agency where he also has right of
retention if expenses incurred by him , and expenses
here don’t talk about luxurious expenses, but it talks
about necessary expenses. Because luxurious
expenses cannot be reimbursed. So 1994,
pinagcombine ito to distinguish it from commodatum.
Again, when you talk on retention, this is not applicable
in loan, but in deposit, it a right given where necessary
expenses need to be reimbursed. This is again by
reason of equity.
And what are again the modes of distinguishing the
contracts of deposit?..
Student: um, according to Art. 1995, (1) Upon the loss
or destruction of the thing deposited..
JH: wait up onto loss, what are the things you are
referring to? It doesn’t really refer to movable or
immovable things but it talks about specific things,
because generic things can never be lost. The second?
Student: (2) In case of a gratuitous deposit, upon the
death of either the depositor or the depositary.
JH: Why?,.
Student: because the depositary is not obliged to
continue with the contract of deposit ma’am since if
there was compensation then it is an onerous deposit
and not personal in nature so the rights and obligations
are transmissible to the respective heirs where it is
gratuitous and is personal in nature and here? It is not
transmissible.
JH: wala atang congruence yung sinabi mo ah.. when
it comes to gratuitous deposit, upon the death of the
depositor or the depositary…. Reason? Because of the
personal nature or personal character of the contract
between them.. however again, there is a distinction
when a deposit is gratuitous whereby death of either
party extinguishes the deposit.. because again
gratuitous is personal in nature but not, if the deposit is
for compensation, because death of either party
doesn’t extinguish deposit. Onerous deposit is not
personal in nature, therefore transmissible to the heirs.
However you cannot force the heirs to recognize the
deposit itself because the lack-(cannot hear) terminate
the contract even before the termination of the- (cannot
hear). Remember, the right can be transferred to them
but you cannot force them. So the most that can be
done is, they can give it back, then whatever
compensation they have received shall be properly
deducted an I mean ah, proportioned, in accordance
with the time…
Montemayor 0:20:01 to 0:28.30
JH: That this object is in the possession of their
predecessor. Okay? So you take note of that. But these
two ways are not the only ones which extinguishes the
contract of deposit, right? because there are other
modes extinguishing the contract of deposit and what
are those?
S: According to article 1231, other modes of
extinguishing deposit are the return of the thing,
novation, merger, expiration of the term and fulfillment
of a resolutory condition.
JH: In other words, same as extinguishing a contract or
an obligation as the case. So you take note of that only
that in your book on deposit there are only two
instances although it does not preclude other causes
of extinguishment of an obligation or contract to set it.
So we move on to the next kind of extrajudicial deposit
which is what you call necessary. right? and when is a
deposit necessary?
s: According to article 1996, a deposit is necessary
when it is made in compliance with a legal obligation
and made on an occasion of a calamity and article
1998 also mentions a necessary deposit when a
deposit is made by travellers in hotels and inns.
JH: Now lets go to the first one, when it is made in
compliance with a legal obligation. Will you give me an
example of this?
S: A judicial deposit of a thing where the possession of
the certain thing is being disputed in litigation and the
case is pending.
JH: Another one?
S: A deposit in a bank or a public institution of bonds or
instruments of credit when they are payable to order or
to bearer given in usufructuary, when the usufructuary
does not give proper security.
JH: Any more?
S: As provided in the rules of court, those deposits that
are required in suits.
JH: Any more?
S: Those constituted to guarantee contracts with the
government
JH: And the last one? The very popular one.
S: Deposit of the thing pledged when the creditor uses
the same without the authority of the owner or misuses
it.
JH: And of course the deposits made by those who
desire to use firearms. So if there are privileges given
you and in the exercise of these privileges, you are to
get something in deposit more often than not, monetary
considerations. okay? so you take note of the first
example. Those which are made in compliance with
the legal obligation. So the law itself provides for the
deposit and then next one, when it takes place in the
occasion of every calamity such as fire, storm, flood,
tillage, shipwreck or other similar events or these are
known as depositos miserables.
So what are those depositos miserables? those which
takes place on the occasion of any calamity, like fire,
storm,flood, tillage and other similar events. In other
words, caused by fortuitous events and then we will be
having a separate discussion when we will be talking
about those made by travellers and common carriers.
Okay?
Article 1997 merely talks on the governing laws. Laws
which govern the situations as contemplated in article
1996.
Okay lets now go to you mr. vicente. So, this is another
kind of deposit which talks about those made by
travellers in hotels or inns. This is also necessary. Why
necessary? Why is it called necessary?
S: Because the deposits made to them are necessary
in their line of business.
JH: Because when you check-in, it is necessary in a
hotel or an inn.This is to be done by way of S.O.P. Hindi
ka pwedeng pumasok lang sa isang hotel dala-dala mo
na everything ng hindi ka nagsasabi kung ano yung
mga dinadala mo. Otherwise, kapag nawala lahat iyan.
you will be the one liable. Okay. So what does article
1998 provide?
S:The deposits made by travellers in hotels or inns are
also necessary deposits and as well as the keepers of
hotels or inns are also responsible, they are also
responsible as depositaries as long as there is notice
given to them and as long as they take necessary
precautions with regard to the care and safekeeping of
the effects deposited unto them.
JH: Who shall take necessary precaution?
S: Those who deposited the thing.
JH: Necessary precautions should be undergone or
done by the guest?
S: The depositors, the guest, they should be the one
to, shall take necessary precautions with regard po to
their items deposited to such hotel keepers and hotels
or inns.
JH: But you should understand that both of them has
their respective responsibilites. Right? It could not be a
one-sided responsbility. There is a responsibility of the
hotel keeper or innkeepers much that are also
responsibilities which must be done by the guests,
correct? oh mr vicente. Have you tried checking in a
hotel?
S: Yes po justice.
JH: Is it the same with motel?
S: No po.
JH: In the first place what is the distinction between a
hotel and a motel?
Pe Benito 0:28:31 to 0:37:00
A: The distinction between Motel and Hotel is that in
Motels, are establishments that provides lodging and
parking. On the other hand,
JH: Where do you enter when you go to a motel?
A: If there is a parking, sa parking po.
JH: Usually access to the motel is accessible from an
outdoor parking area. Yan ang motel. They provide of
course lodging and parking. It’s wrong to say that they
do not provide for food kasi pwede naman ang food
service. What about a hotel? A hotel has many rooms
which are chiefly for overnight accommodation for a
longer use and it has several floors that serve elevators
usually with a large lobby. That is the perfect
description of a hotel. There can be events which are
held in the hotel.
What about an inn? It could be used for public
entertainment which does not provide for lodging. In
hotels and motels, they usually cater to people. More
often than not, they offer accommodations.
JH: What about the distinction between an inn keeper,
traveler and an effect?
A: An innkeeper is an employee which caters mostly
for travelers mostly for their lodging and other
necessities of occupying such an inn.
Ramos 0:37:01 to 0:45:30
Who is a traveler?
JH: So a traveler refers to a transient in a particular
place. So he doesn’t stay there for long, more often
than not, he just stays there overnight or two nights or
three nights. And those in the boarding house are
not considered travelers because there is the
character of permanency for at least a particular period
of time. And when you talk about effects, all kinds of
personal property like jewelry, cash, and the like, at
least those with valuable consideration.
When you go to these places, the inn-keepers are
liable. So what are the instances where they are
liable?
Answer: The hotel and inn-keepers will be liable for any
loss or injury to the personal property of the depositor.
For the liability to attach information must be given by
the guest on his items. On the part of the guest,
precautions must also be given as to what are those
effects or properties which they are taking with them.
JH: 1) When loss or injury is caused by its employees
or strangers provided notice has been given and
precautions has been made by the guest.
2) when there is theft or robbery done without the use
of firearm or irresistible force because here the
hotel/inn-keeper is presumed to be negligent.
Take note, “WITHOUT the use of firearm or irresistible
force”; when theft there is no force, if robbery, there is
force. But it could be shown that there is theft or
robbery, they could be held liable. Because of the facrt
that they are responsible to hold or the keep the things
safe, or to keep the property, the hotel or the inn safe.
Are the hotel-keepers, inn-keepers, may be free
from liability by posting notices on the wall saying
they will not be held liable for any loss or damage
to the guest? Can they escape liability through
these postings?
Answer: No. Any stipulation to such effect shall be void
pursuant to Article 2003 of the NCC.
What are the instances that the hotel/inn-keepers
are NOT liable?
Answer:
1. Loss or injury cause be force majeure -- of
course, they do not have control over it.
2. Loss is due to the acts of the guest, his family,
servants or visitors, or if the loss arises from
the character of the things brought into the
hotel (2002)
3. Act of thief or robber done with the use of
arms or through an irresistible force (2001);
XPN: no use of force or there is negligence
4. Loss is brought by the character of the thing
brought into custody (2002)
In other words, when you check in a hotel, inn, or motel,
the hotel-keepers are responsible, and so are you.
Both of you have responsibility. If you are amiss in this
responsibility, either you or the hotel-keeper will be
liable. Note of these instances.
Article 1999 is self-explanatory, the hotel-keeper is
liable for the vehicles, animals, and articles which have
been introduced or placed in the annexes of the hotel.
JH: Of course, provided that you tell them what vehicle
do you have, or that you bring animals inside the room,
or that you placed them in particular cages provided by
the hotel, they are also responsible.
In Article 2000, it is just a discussion of the above
provision.
Romana 0:45:31 to 0:54:00
You take note of the instances and the instances of the Answer of the student: The owner cannot open the
hotel keeper is not liable are as follows : (1) when the vault, but he needs the key of the hotel employee also.
loss or injury is caused by force majeure (2) the loss is
due to the acts of the guest, his family, servants or Atty H: When you go to a hotel or an inn, is important
visitors or in other words they are the companions (3) there is, if you want to bind the hotel is tell them,
when theft or robbery is caused by strangers with the because if you do not tell them, they are not liable
use of arms or irresistible force unless he is also guilty except when there is loss due to force.
of fault or negligence (4) when the loss is caused by
the character or nature of the thing brought in the inn. · You can never bind them, for safety vaults are
In other words, when you check in a motel or hotel or concerned, they are for the benefit of the guests.
inn, the hotel keepers are responsible, likewise you are
also responsible. So, both of you should have your own
· Then if the things inside are loss, then it’s a matter of
responsibilities, so either you or the hotel keeper will
proving first that there is force in the opening of the
be liable.
vault.
Art. 1999 is self-explanatory, so the hotel keepers are
· In order for them to escape liability, “hindi nyo naman
liable also for vehicles, animals, and articles which may
po sinabi na may dala po pala kayong ganyan.
have been introduced or placed in the annexes of the
hotel, of course provided that you shall also tell them
what vehicles that you have or animals. · The danger all your effects there, most often than not
they will get it for their benefit, which the guest do not
like right?
Art. 2000 this is just a discussion of the above
provision.
· So for the advice of the guest, that they should be
careful as soon as possible, they note the joint
What is Art. 2001? (asked by justice)
responsibility of the both the hotel and the guests.
Answer: Art. 2001. The act of a thief or robber, who has
Art. 2002. The hotel-keeper is not liable for
entered the hotel is not deemed force majeure, unless
compensation if the loss is due to the acts of the guest,
it is done with the use of arms or through an irresistible
his family, servants or visitors, or if the loss arises form
force.
the character of the things brought into the hotel.
What if for example the robber or thief uses the fire
Art. 2003.The hotel-keepr cannot free himself from
escape? Went up the room, entered the room through
responsibility by posting notices to the effect that he is
the window and took personal property of the guest. Is
not liable for the articles brough by the guest. Any
the hotel keeper liable? (asked by justice)
stipulation between the hotel-keeper and the guest
whereby the responsibility of the former as set forth in
Answer: Yes. Hotel keeper is liable since the robber or Articles 1998 to 2001 is suppressed or diminished shall
thief did not employ the use of arms or irresistible force be void.
hence, it is not deemed force majeure and the hotel
keeper is liable.
Atty H: This is similar to rule on common carrier, for
they could exempt themselves from liability or limit
What if for example, I checked in a hotel I have a their liability. why?
diamond ring with me and my Rolex and of course they
are worn by me and I need not tell the reception area
· Because of their duty to supervise and control, hence,
about this thing, I placed this in the vault inside the
the reliance of the faith of the guest while in their
hotel room and all of a sudden, they got lost. Will the
premises is regarded. So mahirap magmaintain ng
hotel keeper be liable? (asked by justice)
hotel, you must assure that your guests will be safe,
while inside the hotels or inns.
Answer: No. The hotel keeper will not be liable because
the hotel keeper must be notified about the diamond
Q: Art. 2004. Explain the retention.
ring and Rolex. The hotel keeper may argue that they
are not liable because they are not aware about the
things the guest brought in. The guest should have told The hotel-keeper has a right to remain the things
the hotel keeper about the jewelry to bind the hotel brought into the hotel by the guest, as a security for
keeper and held them liable. credits on account of lodging, and supplies usually
furnished to hotel guess.

Saguid 0:54:01 to 1:02:3

· So that for example, if I do not have money to pay to
stay in the hotel, and in the meantime the hotel, to
retain all my things like my clothes.
· So what if, sa inyo na lang yung mga gamit ko, iwanan
ko na lang wala akong pera?
Atty H: Can that be done?
· Answer ni Atty: Kahit pwede, that can’t be done. Kasi
we can place our clothes in the maleta, then we can go
to 5 star hotel, di na tayo magbabayad. Iwan na lang
natin yung gamit.
· Di yun pwede dahil you should pay in money and not
in kind. Now, the right to retain is there, we could not
leave the premises of the hotel, unless you’ll pay.
Q: What about you did not pay the food? What charge
will be filed against you?
Answer: Estafa
· In criminal law, one of the ways of committing estafa
is not paying your food. That’s fraud already, kumain
ka pero wala ka palang pambayad.
accommodation are not paid, this constitutes the crime
of estafa).
Now insofar as sequestration or judicial deposits
are concerned, these are especially true during the
marcos administration. When the Marcoses left, their
properties were sequestered by the government.
A judicial deposit or sequestration takes place when
attachment or seizure of property in litigation is
ordered.
• This is auxiliary to a pending case because
you cannot sequester the property of another
person without filing a case. This is an
offshoot of a case.
• The property sequestered is in the custody of
the court and it shall remain there pending the
case. It is only released when the case is
terminated.
• Purpose: To maintain the status quo during
the pendency of the litigation. To ensure that
the right of the parties in case of favorable
judgment.
2006, 2007 and 2008 are self explanatory.

· Take note, the right of retention, the hotels may Now, 2009 merely states that suppletory rules are
exercise in cases when, you do not pay your use of that provided under the Rules of Court and in case of
said hotel. conflict, the Civil Code prevails.

• Reason: Because the Civil Code is a

substantive law while the ROC is a procedural
Yusi 1:02:31 to 1:11:57 law.

Q: Now, if you use credit cards and then subsequently -------------Done-------------

you don’t pay, the credit cards, is that not also
defrauding the hotel?

Answer: No, in such a case, you are merely defrauding

the bank because the hotel has already been paid.

Now, the purpose of retention is to compensate the

innkeeper for the extraordinary liabilities imposed upon
him by law. Of course, you have to pay.

Q: Does the innkeeper have the right to sell the thing

left by the guest? (JH: eto, nangyayari lang pag nag
escape ‘yung guest)

Answer: By analogy to the contract of pledge, YES.

The right of retention is in the nature of a contract of
pledge, created by operation of law. So pwede, okay.
(JH: Actually, sa Thailand ganyan ang ginagawa nila
eh. Travellers check in a hotel in Thailand then they
just escape. They did not check out. Kaya ang
nangyayari, maraming mga for sale na gamit sa lobby
ng mga hotel sa Thailand, dahil sa mga manlolokong
travellers. Take note that if the bills of the hotel and