CORPORATION CODE

OF THE PHILIPPINES
TABLE OF CONTENTS

I. CONCEPTS OF CREDIT AND CREDIT TRANSACTIONS

READ:

Articles 1156, 1305, 1306, 1315, 1316, 1318, Civil Code

Section 3 (2), Republic Act (R.A. No. 3765)

CASES:

Republic vs. PNB, G.R. No. L-16106 (1961)

People vs. Conception, G.R. No. L-19190 (1922)

I. Introduction………………………….…………………………………………..……………………………………………. 1

II. LOAN

A. In General; Common Principles

READ:
Articles 1933 to 1934, Civil Code

CASES:
Saura Import & Export Co., Inc. vs. DBP, G.R. No. L-24968 (1972)
BPI Investment Corp. vs. CA, G.R. No. 133632 (2002)
Garcia vs. Thio, G.R. No. 154878 (2007)
Pantaleon vs. American Express International, Inc., G.R. No. 174269 (2010)

B. Commodatum
READ:
Articles 1933, 1935 to 1952, Civil Code

CASES:
Quintos vs. Beck, G.R. No. 46240 (19390
Republic vs. Bagtas, G.R. No. L-17474 (1962)
Republic vs. CA, G.R. No. L-46145 (1986)
Catholic Vicar Apostolic vs. CA, G.R. No. L-80294-95 (1988)
Manzano vs. Perez, G.R. No. 112485 (2001)
Producers Bank of the Philipines vs. CA, G.R. No. 115324 (2003)
Pajuyo vs. CA, G.R. No. 146364 (2004)

C. Simple Loan/ Mutuum

READ:
Articles 1953 to 1955, 1980, Civil Code

CASES:
Tolentino vs. Gonzales Sy Chiam, G.R. No. 26085 (1927)
Cebu International Finance Corp vs. CA, G.R. No. 123031 (1999)
Naguiat vs. CA, G.R. No. 118375 (2003)
People vs. Puig & Poitas, G.R. No. 173654-765 (2008)

READ:

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 Articles 1249 to 1250, Civil Code
R.A. No. 8183

CASES:
Equitable PCI Bank vs. Ngor, G.R. No. 17145 (2007)

II. Loan………………………………………………………….……………………………………………………………………….3
1. General Provisions …………………………….…………………………………………………………………….3
2. Chapter 1 – Commodatum ………………….………………………………………………….………………….5
3. Chapter 2 – Simple Loan or Mutuum….…………………………………………………………………….. 9

III. INTEREST

READ:

Articles 1253, 1306, 1956 to 1961,2209, 2210, 2212, 2213, 2226, 2227, Civil Code

A. Kinds of Interest
CASES:
Siga-an vs. Villanueva, G.R. No. 173227 (2009)
Frias vs. San Diego-Sision, G.R. No. 15223 (2007)
Integrated Realty Corp. vs. PNB, G.R. No. 60705 (1989)
Ligutan vs. Court of Appeals, G.R. No. 138677 (2002)
Tan vs. CA, G.R. No. 116285 (2001)
Eastern Shipping Lines vs. Court of Appeals, G.R. No. 97412 (1994)
Crismina Garments vs. CA, G.R. No. 128721 (1999)

READ:
BSP-MB Resolution No. 796 (May 16, 2013)

CASES:
Nacar vs. Gallery Frames and Bordey, Jr., G.R. No. 189871 (2013)
B. Usury
READ:
Articles 1306, 1308, Civil Code
Act No. 2655, as amended (esp. Secs. 1-3. 4-a, 5, 6, 7, 7-a)
Central Bank Circular Nos. 416, 905

CASES:
Advocates for Truth in Lending, Inc. vs. Bangko Sentral, G.R. No. 192986 (2013)
Banco Filipino vs. CA, G.R. No. 129227 (2000)
Sps Juico vs. China Banking Corporation, G.R. No. 187678 (2013)
Sps Silos vs. PNB, G.R. No. 181045 (2014)
Carpo vs. Chua, G.R. Nos. 150773 & 153599 (2005)
Estores vs. Sps Supangan, G.R. No. 175139 (2012)
C. Finance Charges
READ:
R.A. No 3765 or Truth in Lending Act (Sections 4, 6(a), (c))
CASES:
United Coconut Planters Bank vs. Samuel & Beluso, G.R. No. 159912 (2007)

III. Interest ……………………………………………………………………………………………………………………………12

1. Interest……………………………………………………………………………………………………………………
2. Usury………………………………………………………………………………………………………………………
3. Finance Charges……………………………………………………………………………………………………….

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 IV. DEPOSITS

A. In General; Common Provisions

READ:
Articles 1316, 1962-1967, Civil Code

CASES:
Bank of the Philippine Islands vs. IAC, G.R. No. L-66826 (1988)
Roman Catholic Bishopvs. De La Pena, G.R. No. 6913 (1913)
CA Agro-Industrial Dev. Corp vs. CA, G.R. No. 90027 (1993)

B. Voluntary Deposit

READ:
Articles 1968-1995, Civil Code

CASES:
Sia vs. Court of Appeals, G.R. No. 102970, May 13, 1990
Javellana vs. Lim, G.R. No. 4015 (1908)
Chan vs. Maceda, G.R. No. 142591 (2003)
Serrano vs. Central Bank, G.R. No. L-30511 (1980)

C. Necessary Deposit

READ:
Articles 1754, 1996-2004, 2168, Civil Code

CASES:
Durban Apartment vs. Pioneer Insrance, G.R. No. 179419 (2011)
YHT Realty corp. vs. Court of Appeals, G.R. No. 126780 (2005)
Triple-V vs. Filipino Merchants Insurance Corp., G.R. No. 160544 (2005)

D. Judicial Deposit

READ:
Articles 2005-2009, Civil Code

IV. Deposits………………………………………………………………………………………………………………………….
1. Chapter 1 – Deposit in General and its Differences………………………………........................
2. Chapter 2 – Voluntary Deposit…………………………………………………………………………………
i. Section 1: General Provisions………………………………………………………………………..
ii. Section 2: Obligations of the Depositary…………………………………………………………
3. Chapter 3 – Necessary Deposit…………………………………………………………………………………..
4. Chapter 4 – Sequestration or Judicial Deposit……………………………………………………………..

V. WAREHOUSE RECEIPTS LAW AND GENERAL BONDED WAREHOUSE ACT

READ:
Act No. 2137, as amended 9esp. Sections 1-8, 13-16, 20-33, 37, 39, 40, 44, 58)
Act No. 3893, as amended

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CASE:
PNB vs. Se, G.R. No. 119231 (1996)

V. Warehouse Receipts Law and General Bonded Warehouse………………………………………….

VI. LETTERS OF CREDIT

CASE:
Transfield Philippines, Inc. vs. Luzon Hydro Corporation, G.R. No. 146717 (2004)

VI. Letters of Credit……………………………………………………………………………………………………………….

VII. TRUST RECEIPTS LAW

READ:
P.D. No. 115 (esp. Sections 2, 3(j), 4, 5, 7, 9, 10, 12, 13)
Article 315, Revised Penal Code

CASE:
Colinares vs. Court of Appeals, G.R. No. 90828 (2000)

VII. Trust Receipts Law…………………………………………………………………………………………………………

VIII. GURANTY AND SURETYSHIP

A. In General
READ:
Articles 1403 (2)(b), 2047, Civil Code

CASE:
Autocorp vs. Intra, G.R. 16662 (2008)

B. Guaranty
READ:
Articles 2047-2081, Civil Code

CASES:
Tupaz vs. Court of Appeals, G.R. No. 145578 (2005)
Ong vs. PCIB, G.R. No. 160466 (2005)
Zobel, Inc. vs. Court of Appeals, G.R. No. 113931 (1998)
Dino vs. Court of Appeals, G.R. No. 89775 (1992)
Willex Plastic Industries Corp. vs. Court of Appeals, G.R. No. 103066 (1996)
Luzon Steel Corp. vs. Sia, G.R. No. L-26449 (1969)
Cochingyan, Jr. vs. R&B Surety and Insurance Co., G.R. No. L-47369 (1987)
PNB vs. Court of Appeals, G.R. No. L-30937 (1987)

C. Suretyship
READ:
Articles 2047, 2082-2084, Civil Code
Cf: Articles1207-1222 (Joint and Solidary Obligations), CivilCode

CASES:
Palmares vs. Court of Appeals, G.R> No. 126490 (1998)
Security Bank and Trust Co. vs. Cuenca, G.R. No. 138544 (2000)
Zobel vs. Court of Appeal, supra

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 Escano vs. Ortigas, G.R. No. 151953 (2007)

VIII. Guaranty and Suretyship………………………………………………………………………………………………

1. Chapter 1 – Nature and Extent of Guaranty……………………………………………………………….
2. Chapter 2 – Effects of Guaranty………………………………………………………………………………..
3. Chapter 3 – Extinguishment of Guaranty…………………………………………………………………..
4. Chapter 4 – Suretyship: Legal and Judicial Bonds………………………………………………………

IX. PLEDGE AND MORTGAGE

A. In General; Common Provisions

READ:
Articles 2085-2092, Civil Code

CASES:
Manila Banking Corp. vs. Teodoro, G.R. No. 53955 (1989)
Olea vs. Court of Appeals, G.R. No. 109696 (1995)
Arenas vs. Raymundo, G.R. No. 5741 (1911)
Development Bank vs. Court of Appeals, G.R. No. 118342 (1998)
Ong vs. Roban Lending, G.R. No. 172592 (2008)

B. Pledge
READ:
Articles 2093-2123, Civil Code

CASE:
Integrated Realty, supra
Manila Banking vs. Teodoro, supra
Manila Surety & Fidelity Co. vs. Velayo, G.R. No. L-21069 (1967)
Citibank vs. Sabeniano, G.R. No. 156132 (2006)
Paray vs. Rodriguez, G.R. No. 132287 (2006)

C. Real Estate Mortgage

READ:
Articles 2124-2131, Civil Code
Act 3135, as amended
Rule 68, Rules of Court
SC AM 99-10-05 (1999) as amended

CASE:
Samanilla vs. Cajucom, G.R. No. L-13683 (1960)
People’s Bank & Trust Co. vs. Dahican Lumber, G.R. No. L-17500 (1967)
Mobil Phils. Vs. Diocares, G.R. No. L-26371 (1969)
Medida vs. Court of Appeals, G.R. No. 98334 (1992)
DBP vs. Court of Appeals, G.R. No. 118342 (1998)
Pineda vs. Court of Appeals, G.R. No. 114172 (2003)
Sps Yap vs. Sps Dy, G.R. No. 171868 (2011)
Sps Tolosa vs. UCPB, G.R. No. 183058 (2013)
Huerta Alba Resort, Inc. vs. CA, G.R. No. 128567 (2000)

D. Chattel Mortgage
READ:
Articles 2140-2141, Civil Code
Chattel Mortgage law (esp. Sections 2-5, 7, 14)
SC AM No. 99-10-05-0 (2001)

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 CASE:
Acme Shoe, Rubber & Plastic vs. Court of Appeals, G.R. No. 103576 (1996)
Makati Leasing vs. Wearever Textile, G.R. No. L-58469 (1983)
Dy vs. Court Appeals, G.R. No. 92989 (1991)
Servicewide Specialist, Inc. vs. Court of Appeals, G.R. No. 116363 (1999)
California Bus Lines, Inc. vs. State Investment House, Inc., G.R. No. 147950 (2003)
PAMECA Wood Treatment Plant vs. Court of Appeals, G.R. No. 06435 (1999)

IX. Pledge and Mortgage………………………………………………………………………………………………………

1. Provisions Common to Pledge and Mortgage…………………………………………………………….
2. Pledge – Provisions Applicable to Pledge………………………………………………………………….
3. Real Estate Mortgage………………………………………………………………………………………………
4. Chattel Mortgage……………………………………………………………………………………………………..

X. ANTICHRESIS

READ:
Articles 2132 to 2139, Civil Code

CASES:
Diego vs. Fernando, G.R. No. L-15128 (1960)

X. Antichresis……………………………………………………………………………………………………………………….

XI. INSOLVENCY

A. In General
READ:
Articles 2236 to 2240 Civil Code
Sections 2, 3, 4(p), 146, R.A. No. 10142 (FRIA)

B. Concurrence and Preference of Credits

1. Classification
READ:
Articles 2241 to 2245, Civil Code

2. Order of Preference
READ:
Articles 2246 to 2251, Civil Code

CASES:
De Barreto vs. Villanueva, G.R. N. L-14938 (1961)
DBP vs. NLRC, G.R. No. 86227 (1994)
Consuelo Metal Corp. vs. Planters Development Bank, G.R. No. 152580 (2003)
Cordova vs. Reyes, G.R. No. 146555 (2007)

C. Insolvency Proceedings, Suspension of Payments, and Rehabilitation

READ:
R.A. No. 10142 or FRIA (esp. Sections 4(c), (h), (k), (n), (o), (p), (q), (r), (s), (u), (w), (gg), (rr), 5,
12-14, 28, 76, 90, 91, 94, 112)

CASE:
Umale vs. ASB Realty, G.R. No. 181126 (2011)

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 Panlilio vs. RTC Branch 51, City of Manila, G.R. No. 173846 (2011)
Situs Development Corp. vs. Asia Trust. G.R. No. 180036 (2013)

XI. Insolvency………………………………………………………………………………………………………………………..
1. Concurrence and Preference of Credits………………………………………………………………………
2. Chapter 1 – General Provisions…………………………………………………………………………………
3. Chapter 2 – Classification of Credits………………………………………………………………………….
4. Chapter 3 – Order of Preference of Credits………………………………………………………………..
5. Insolvency Law/ FRIA…………………………………………………………………………………………….
i. Suspension of Payments………………………………………………………………………………..
ii. Voluntary Insolvency……………………………………………………………………………………
iii. Involuntary Insolvency…………………………………………………………………………………
iv. Assignees…………………………………………………………………………………………………..
v. Classification and Preference of Creditors………………………………………………………
vi. Partnership and Corporations………………………………………………………………………….
vii. Proof of Debts………………………………………………………………………………………………..
viii. Compositions………………………………………………………………………………………………
ix. Discharge……………………………………………………………………………………………………
x. Fraudulent Preferences and Transfers……………………………………………………………..

ANNEXES

ANNEX A – COMMODATUM and SIMPLE LOAN……………………………………………………………………..

ANNEX B – COMMODATUM and VOLUNTARY DEPOSIT……………………………………………………..
ANNEX C – JUDICIAL and EXTRAJUDICIAL FORECLOSURE of REM…………………………………
ANNEX D – SUMMARY: PLEDGE, REAL ESTATE MORTGAGE, CHATTEL MORTGAGE,
ANTICHRESIS………………………………………………………………………………………………………….
ANNEX E – CREDIT TRANSACTION CASE SUMMARY/ QUICK REVIEWER
A. LOAN………………………………………………………………………………………………………………….
B. INTEREST………………………………………………………………………………………………………….
C. WAREHOUSE RECEIPTS…………………………………………………………………………………
D. LETTERS OF CREDIT AND TRUST RECEIPTS……………………………………………….
E. GUARANTY AND SURETYSHIP……………………………………………………………………….
F. PLEDGE, MORTGAGE, ANTICHRESIS……………………………………………………………
G. CONCURRENCE/ PREFERENCE OF CREDIT………………………………………………..
H. INSOLVENCY……………………………………………………………………………………………………
ANNEX F – FRIA OUTLINE………………………………………………………………………………………………………..

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