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The responsibility referred to in the two preceding articles shall include the
loss of, or injury to the personal property of the guests caused by the servants or
employees of the keepers of hotels or inns as well as strangers; but not that which may
proceed from any force majeure. The fact that travelers are constrained to rely on
the vigilance of the keeper of the hotels or inns shall be considered in determining the
degree of care required of him. (1784a)
Art. 2001. The act of a thief or robber, who has entered the hotel is not deemed force
majeure, unless it is done with the use of arms or through an irresistible force. (n)
Art. 2002. The hotel-keeper is not liable for compensation if the loss is due to the acts of the
guest, his family, servants or visitors, or if the loss arises from the character of the
2. The loss is caused by the act of the thief or robber done without the use of
arms and irresistible force for in this case, the hotel-keeper is apparently negligent.
2. The loss is due to the acts of the guests, his family, servants, or visitors
3. The loss arises from the character of the things brought into the hotel
Art. 2003. The hotel-keeper cannot free himself from responsibility by posting notices
to the effect that he is not liable for the articles brought by the guest. Any stipulation
between the hotel-keeper and the guest whereby the responsibility of the former as set
forth in articles 1998 to 2001 is suppressed or diminished shall be void. (n)
2. Inn-keepers by the nature of their business, have supervision and control of their
inns and the premises thereof. As a matter of fact, authorities are to the effect that it is not
necessary in order to hold an inn-keeper liable that the effects of the guests be actually
delivered to him or his employee, it is enough that they are within the inn.
Art. 2004. The hotel-keeper has a right to retain the things brought into to be delivered over
to the grantee, promisee or oblige the hotel by the guest, as a security for credits on account of
lodging, & supplies usually furnished to hotel guests.
APPLICABLE LAW
The law on judicial deposit is remedial and the Rules of Court is thus applicable
Rule 57 on preliminary attachment, Rule 59 on receivership, and Rule 60 on
replevin
C. GUARANTY
Chapter 1
NATURE AND EXTENT OF GUARANTY
(ARTICLES 2047 TO 2084)
Article 2047.
If a person binds himself solidarily with the principal debtor, the provisions of Section 4,
Chapter 3, Title I of this Book shall be observed. In such case, the contract is called a surety
ship.
GUARANTY
> Contract between the guarantor and creditor
> In a broad sense, it includes pledge and mortgage because the purpose of guaranty may be
accomplished not only by securing the fulfillment of an obligation contracted by the
principal debtor through the personal guaranty of a third
person but also by furnishing to the creditor for his
security, property with authority to collect the debt from the proceeds of the same in case
of default.
CHARACTERISTICS OF A GUARANTY
1. Accessory—because it is dependent for its existence upon the principal obligation
guaranteed by it
2. Subsidiary and conditional—it takes effect only when the principal debtor fails in his
obligation subject to limitation
3. Unilateral—
a. Gives rise only to the duty on the part of the
guarantor in relation to the creditor and not vice versa
b. It may be entered into even without the intervention of the principal debtor
4. Contract, which requires that the guarantor be a distinct person from the principal
debtor because a person cannot be the personal guarantor of himself
CLASSIFICATION OF GUARANTY
1. Guaranty in the broad sense—
a. Personal—guaranty properly so-called or guaranty
in the strict sense. The guarantee given is the
credit given by the person who guarantees the fulfillment of the principal obligation.
b. Real—the guaranty is property, movable or immovable
2. As to its origin
a. Conventional
b. Legal
c. Judicial
3. As to consideration
a. Gratuitous
b. Onerous
4. As to persons guaranteed
a. Single
b. Double or sub-guaranty—one constituted to secure the fulfillment of a guarantee in
another guaranty
SURETYSHIP
> A relation which exists where one person has undertaken an obligation and another person
is also under a direct and primary obligation or other duty to a third person, who is entitled to
but one performance, and as between the two
who are bound, the one rather than the other should perform
> Contractual relation resulting from an agreement whereby
one person, the surety, engages to be answerable for a
debt, default, miscarriage of another known as the principal
2. Both debtor and surety, after payment, may require that they be REIMBURSED.
The difference is that the lender cannot go after the surety right away. There has to be default on
the part of the principal debtor before the surety becomes liable. If it were mere solidarity among
debtors, the creditor can go after any of the solidary debtors on due date.
Always remember that a guaranty is unilateral. It exists for the benefit of the creditor and not
for the benefit of the debtor.
The creditor obviously has every right to take all possible means to secure the payment of his
credit
A person who pays without the knowledge or against the will of the debtor can recover only
insofar as the payment has been beneficial to the debtor AND he cannot demand the creditor to
subrogate him into his rights
Art. 2051. A guaranty may be conventional, legal or judicial, gratuitous, or by onerous title.
> It is indispensable for its existence that there must be a principal obligation
> So if the principal obligation is void, it follows that it is also void
Art. 2053. A guaranty may also be given as security for future debts, the amount of which is
not yet known; there can be no claim against the guarantor until the debt is
liquidated. A conditional obligation may also be secured. (1825a)
> One which isn’t limited to a single transaction but which contemplates a future course of
dealings, covering a series of transactions generally for an indefinite time or until revoked
> Prospective in its operations and is generally intended to provide security with respect to future
transactions
> Future debts, even if the amount is not yet known, may be guaranteed but there can be no claim
against the guarantor until the amount of the debt is ascertained or fixed and demandable
> Take note however that the abovementioned provision
may be misleading in sanctioning guarantees for future debts.
What should be bore in mind is that there is
already an existing obligation that is being guaranteed. The guaranty would be
void if there is no existing obligation.
> If the principal obligation is subject to a suspensive condition, the guarantor is liable only after
the fulfillment of the condition
> If it is subject to a resolutory condition, the happening of the condition extinguishes both the
principal obligation and the guaranty
Art. 2054. A guarantor may bind himself for less, but not for more than the principal debtor, both as
regards the amount and the onerous nature of the conditions.
Should he have bound himself for more, his obligations shall be reduced to the limits of that of
the debtor. (1826)
1. Guaranty is a subsidiary and accessory contract—the guarantor cannot bind himself for more
than the principal debtor and even if he does, his liability shall be reduced to the limits of that of the
debtor
2. Interest, judicial costs, attorney’s fees as part of the damages may be recovered
a. The surety is made to pay not by reason of the
contract but by reason of his failure to pay when demanded and for having compelled the creditor
to resort to the courts to obtain payment
b. Interest doesn’t run from the time the obligation becomes due but from the filing of the
complaint
> Requires the expression of consent on the part of the guarantor to be bound
> It cannot be presumed because of the existence of a contract or principal obligation
> Why this rule? The law wants not only that there be assurance that the guarantor has the
true intention to bind himself but also to make certain that on making it, he proceeded with
consciousness of what he was doing
> A guaranty must not only be expressed but must also be reduced to writing
> Falls under the Statute since it is a special promise to answer for the debt, default or
miscarriage of another
> It has to be strictly interpreted against the creditor and in favor of the guarantor and isn’t to be
extended beyond its terms or specified limits
1. DEFINITE GUARANTY—limited in whole or in part to the principal debt, to the exclusion of the
accessories.
If the amount to be paid or the service to be performed by
the person guaranteed is specified in a contract of guaranty, then the obligation of the guarantor
extends no further than the sum or services so specified, and extrinsic
facts cannot be resorted to for the purpose of enlarging the limit if the guarantor was ignorant of
such facts.
2. INDEFINITE GUARANTY OR SIMPLE GUARANTY—it shall
compromise not only the principal obligation, but also all
its accessories, including the judicial costs, provided with respect to the latter, that the guarantor
shall only be liable for those costs incurred after he has been judicially required to pay.
Reason: the guarantor in entering into the contract could have fixed the limits of his responsibility
solely to the strict terms of the principal obligation and if he didn’t do so, it
must be presumed that he wanted to be bound to the extent so established
1. He possesses integrity
> Qualifications need only be present at the time of the perfection of the contract
> The creditor may however demand another guarantor with the proper qualifications but he may
waive it if he chooses and hold the guarantor to his bargain
SELECTION OF GUARANTOR
1. Specified person stipulated as guarantor—where the creditor has required and stipulated that
a specific person should be a guarantor, the substitution of a guarantor may
not be demanded because obviously, in such a case, the selection of the guarantor is a term of the
agreement and the creditor is bound thereby as a party
Art. 2060. In order that the guarantor may make use of the benefit of exclusion, he must set it up
against the creditor upon the latter’s demand for payment from him, and point
out to the creditor available property of the debtor within
Philippine territory, sufficient to cover the amount of the debt. (1832)
Art. 2061. The guarantor having fulfilled all the conditions required in the preceding article, the
creditor who is negligent in exhausting the property pointed out shall
suffer the loss, to the extent of said property, for the
insolvency of the debtor resulting from such negligence. (1833a)
1. When demand to be made—only after judgment on the debt for obviously the exhaustion of the
principal’s property cannot even being to take place before judgment has been obtained
2. Actual demand has to be made—the fact that the guarantor was joined in a suit against the
principal debtor necessarily means that a demand has already been made upon him
> It isn’t enough that the guarantor claims the benefit of excussion
> Failure to comply with duty of creditor would mean that he would suffer the loss but only to the
extent of the value of said property, for the insolvency of the debtor
> The GENERAL RULE is that the guarantor, not being a joint
contractor with the principal, cannot be sued with his principal
> EXCEPTION: not required when it would serve merely to delay the ultimate accounting of the
guarantor
COMPROMISE
> Contract whereby the parties, by asking reciprocal concessions, avoid a litigation or put an end
to one already commenced
EFFECTS OF COMPROMISE
2. Where in the nature of the stipulation in favor of third person—however, even if the guarantor
or debtor is not a party to such compromise, the same can still benefit him
as it is in the nature of a stipulation in favor of a third person which the guarantor or debtor may
accept unless it has been revoked before his acceptance
BAILMENT
> Delivery of property of one person to another in trust for a specific purpose, with
a contract, express or implied, that the trust shall be faithfully executed and the property
returned or duly accounted for when the special purpose is accomplished or kept until the
bailor reclaims it
CREATION OF BAILMENT
> Generally, a bailment may be said to be a contractual relation
> To be legally enforceable, it must contain the essential elements of a valid contract
> It may also be created by operation of law
PARTIES TO A BAILMENT
1. Bailor—the giver; the party who delivers the possession or custody of the thing bailed
2. Bailee—the recipient; the party who receives the possession and custody of the thing
thus delivered
KINDS OF CONTRACTUAL BAILMENT
1. For the sole benefit of the bailor
a. Under this first kind belongs the gratuitous deposit and the mandatum
b. Mandatum—bailment of the goods without
recompense where the mandatory or person to
whom the property is delivered undertakes to do
some act with respect to the same; as simply to
carry it, or keep it, or otherwise to do something with respect to it gratuitously
> The first two kinds are GRATUITOUS BAILMENTS—there is really no consideration for they
are considered more as a favor by one party to the party benefited
> The third kind usually results from bailments involving business transactions—MUTUAL-
BENEFIT BAILMENTS
1. Hire of things (locatio rei)—where goods are delivered for the temporary use of the hirer
2. Hire of service (locatio operis faciendi)—where goods are delivered for some work or
labor upon it by the bailee
3. Hire for carriage of goods (locatio operis mercium vehemdarum)—
where goods are delivered either to a
common carrier or to a private person for the person of being carried from place to place
4. Hire of custody (locatio custodae)—where goods are delivered for storage
PLEDGE
(ARTICLES 2085-2123)
PROVISIONS COMMON TO PLEDGE AND MORTGAGE
Art. 2085. The following requisites are essential to the contracts of pledge and mortgage:
(2) That the pledgor or mortgagor be the absolute owner of the thing pledged or mortgaged;
Third persons who are not parties to the principal obligation may secure the latter by pledging or
mortgaging their own property. (1857)
Art. 2086. The provisions of Article 2052 are applicable to a pledge or mortgage. (n)
PLEDGE
KINDS OF PLEDGE
1. Voluntary or conventional
2. Legal
> FREE DISPOSAL OF THE PROPERTY—property must not be subject to any claim of a third person
> CAPACITY TO DISPOSE—pledgor or mortgagor has the capacity or authority to make a disposition
of the property
> Necessarily implied as an inherent element of the transaction of the mortgage or pledge
> The only remedy for the pledgee is to have the security given sold at public auction and the
proceeds of the sale be applied to the payment of the obligation secured by the mortgage or
pledge