[Name: Sy, Charelle Mei V.

[1975]

[SUBJECT: CREDIT TRANSACTIONS]

XVII.

A partnership borrowed P20,000 from A at clearly usurious interest. Can the creditor recover anything
from the debtor? Explain.

Suggested Answer:

Yes, the creditor can recover the principal together with legal interest thereon from the date of demand
(Art. 2209), and legal interest on the interests paid in excess of the lawful rate from the date of payment
(Art. 1413),

The usurious interest, that is to say, the whole usurious interest cannot be recovered, because of Article
1413 of the Civil Code and Section 6 of the Usury Law. However, the illegality of the stipulation
concerning the usurious interests does not affect the creditor's right to recover the principal, inasmuch
as a contract of loan with usurious interest is a divisible contract. The illegal terms can be separated
from the legal ones (Art. 1420). [Angel Jose v. Chelda, 23 SCR A 119; Briones v, Cammayo, 41 SCRA
404}

XVIII.

A debtor pledged to his surety pieces of jewelry to indemnify the Utter in case the surety would be
obliged to pay the creditor. The surety paid P2,800 00 to the creditor. To recover the amount, the
surety sold at public auction the jewelry but realized only P500. May the surety recover the deficiency
from the debtor? Explain.

Suggested Answer:

No, the surety is not entitled to recover the deficiency. Article 2115 of the Civil Code provides that in
the foreclosure of a pledge, if the price of the sale is less than the indebtedness secured by the pledge,
the creditor shall not be entitled to recover the deficiency, notwithstanding any stipulation to the
contrary. By electing to sell the articles pledged, the creditor waived any other remedy, and must abide
by the results of the sale. No deficiency is recoverable, [Manila Surety v. Velayo, 21 SCRA 615]

[SUBJECT: QUASI-CONTRACTS]

NO BAR QUESTIONS ON QUASI-CONTRACTS

[SUBJECT: TORTS AND DAMAGES]

III.

The award of moral damages in favor of the husband against the wife is assailed on the ground that
her refusal to perform her wifely duties, her denial of consortium and desertion of her husband are
not included in the enumeration of cases where moral damage may lie. Is the contention meritorious?
Why?

Suggested Answer:

No, the contention is not meritorious. The right of the aggrieved husband to recover moral damages
would fall under Article 2219 itself, granting moral damages in the cases enumerated therein which
includes Article 21 and analogous cases. (Tenchavez v. Escano, 15 SCRA 3557)

In the case of Tenchavez v. Escano, the husband was allowed to recover moral damages from his wife
on the ground of desertion.