Payment

Agner vs BPI
- The burden of proof of payment lies upon the debtor.
- Demand is unnecessary for petitioners to be held in default because petitioners legally waived the
necessity of notice or demand when they executed the Promissory Note with Chattel Mortgage.

Death
Stronghold vs Republic Asahi
- As a general rule, the death of either the creditor or the debtor does not extinguish the obligation.
- A surety companys liability under the performance bond it issues is solidary. The death of the principal
obligor, does not, as a rule, extinguish the obligation and the solidary nature of that liability.
- In the case at bar, death did not result in the extinguishment of those obligations or liabilities, which
merely passed on to his estate. Death is not a defense that he or his estate can set up to wipe out the
obligations under the performance bond.

Application of Payments
PNB vs Ca
- Under Art. 1233 of the Civil Code, a debt shall not be understood to have been paid unless the thing or
service in which the obligation consists has been completely delivered or rendered, as the case may be.
- The burden of proof of such payment lies with the debtor. In the instant case, neither the SPA nor the
check issued by petitioner was ever presented in court.
Culaba vs SMC
- Obligation is not extinguished. Article 1240 of the Civil Code provides that payment shall be made to
the person in whose favor the obligation has been constituted, or his successor-in-interest, or any person
authorized to receive it.
- The basis of agency is representation. A person dealing with an agent is put upon an inquiry and must
discover upon his peril the authority of the agent.
Allied Banking vs Lim Sio Wan

- Art. 1240 of the Code states that payment shall be made to the person in whose favor the obligation has
been constituted, or his successor in interest, or any person authorized to receive it.
- Lim Sio Wan did not authorize the release of her money market placement to Santos and the bank had
been negligent in so doing.
Dela Cruz vs Concepcion
- Obligation of respondent is extinguished. Payment made to Adoracion Losloso is valid because there
was a letter executed by petitioner spouses authorizing Losloso to accept payment.
- When the issue is tried without the objection of the parties, it should be treated with all respects as if it
had been raised in the pleadings. Thus, while respondent first admitted in her Answer that she still owed
petitioners 200,000, and during the presentation of evidence submitted a receipt to show that she already
paid the whole amount of her unpaid obligation, it is noteworthy that petitioners did not object thereto.

Dation in Payment
Estanislao vs East West Bank
- The deed of assignment was a perfected agreement which extinguished petitioners total outstanding
obligation to the respondent.
- The deed explicitly provides that the assignor (petitioners), in full payment of its obligation shall
deliver the 3 units of heavy equipment to the assignee (respondent), which accepts the assignment in full
payment of the above-mentioned debt.
Ong vs Roban Lending
- The Court finds that the Memorandum of Agreement and Dacion in Payment constitute pactum
commissorium.
- The elements of pactum commissorium which enables the mortgagee to acquire ownership of the
mortgaged property without the need of any foreclosure proceedings, are: (1) there should be a property
mortgaged by way of security for the payment of the principal obligation, and (2) there should be a
stipulation for automatic appropriation by the creditor of the thing mortgaged in case of non-payment of
the principal obligation within the stipulated period.
Typingco vs Lim

- There having been no previous foreclosure of the Real Estate Mortgage on the subject property,
respondent Sychingcos ownership thereof remained intact. Indeed, a mortgage does not affect the
ownership of the property as it is nothing more than a lien thereon serving as security for the debt.

- Since petitioner agreed to the full extinguishment of respondent spouses then outstanding obligation in
view of the unconditional conveyance to him of the subject property, there is a perfected and enforceable
dacion en pago.
Tan Shuy vs Maulawin
- The pesadas served as proof that the net proceeds from the copra deliveries were used as installment
payments for the debts of respondents.
- The subsequent arrangement between Tan Shuy and Guillermo can thus be considered as one in the
nature of dation in payment. There was partial payment every time Guillermo delivered copra to
petitioner as installment payments for his loan from Tan Shuy.