1251

NO EXAMPLE FOUND
Pero may nakita akong case for an idea lang:

“ it is the full responsibility of the plaintiffs to collect the rents to the place where the obligation
made and it was stated on this article that “In any other case the place of payment shall be the
domicile of the debtor.”

Venue of Payment
1. Specific place designated where payment shall be made.
2. If there is no agreement, the following rule shall apply:
a. Delivery of determinate thing – on the place where the thing might be at the
time the obligation was
constituted.
b. Other cases (delivery of money, generic thing or to perform a personal
obligation) – at the domicile of the debtor.

1252 Rules on application of payments.

EXAMPLES:

D owes C as follows:

(a) P1,500.00 payable on September 5;

(b) P1,200.00 payable on September 20;

(c) A specific table worth P2,000.00 to be delivered on September 20; and

(d) P1,000.00 payable on October 15.

(1) On September 20, D paid C P1,500.00. D may apply the P1,500.00 to debt (a), or to debt
(b) and (if C does not object) to a portion of debt (a).

If D paid only P1,000.00, he cannot choose to apply his payment to the P1,500.00 debt
because C cannot be compelled to receive partial payment. (see Art. 1248.) D cannot properly
apply his payment to debt (c) because it is not of the same kind. He must deliver the thing
agreed upon. (Art. 1244.) Neither can he apply it to debt (d) which is not yet due unless there
is a stipulation to the contrary or he has the benefit of the period.

An application of payment made by the debtor without objection from the creditor is binding
upon the latter. His acquiescence is equivalent to an agreement and has the force and efficacy
of a contract. (Sanz vs. Lavin, 6 Phil. 299 [1906].)

(2) If D does not make a choice, C can make the designation in the receipt with the consent of
D. D may change the application made by C. Note that the law says “if the debtor accepts”
(par. 2.), which implies that he has the liberty to reject also.

The acceptance by D of the receipt given by C is regarded by the law as contract in itself
independent of the principal obligation. His acquiescence to the application made by C
amounts to an assent to such application (Ibid.), which he may no longer revoke or change
(Bachrach Garage & Taxicab Co. vs. Golingco, 39 Phil. 912 [1919].), “unless there is a cause
for invalidating the contract” (Art. 1252, par. 2.) as where the consent of D in accepting the
receipt was vitiated by reason of fraud, mistake, etc. (see Art. 1330.)

(3) If C does not make the application in the receipt or no receipt was issued by him, then the
legal rules in Article 1254 will govern

1253
No examples
Hence, the debtor cannot choose to credit his payment to the principal before the interest is
paid. The payment must be applied first to the interest and whatever balance is left, must be
credited to the principal. (De Leon book)

1254
No examples
* A debt is more onerous than another when it is more burdensome to the debtor.
(De Leon book)
Just in case asked:
Guides in Determining Which Debt is More Onerous: 

1. A debt that bears interest is more burdensome than a debt which does not. 

2. Older debts are more onerous than recent debts. 

3. A mortgage obligation is more burdensome than a debt arising from a current
account. 

4. A mortgage debt is more burdensome than unsecured advances. 

5. Debts covered by a guaranty are more onerous because the creditor & guarantor
may sue the debtor. 

6. In a bond where the surety is bound solidarily with the debtor but for a lesser
amount, the principal 
 debtor’s portion is more onerous. 

 7. Debts subject to a penal clause is more onerous than debts subject to the
general rules on damages. 

8. An exclusive debt is more burdensome than a solidary debt! 


1255 Payment by cession

Example:
D is indebted to several creditors in the total amount of P 2,000,000. His assets are not
sufficient to pay all his debts. With the consent of his creditors, D may assign his property to
them to be sold, to satisfy their credits. If the net proceeds of the sale only amount to P1.5
million, D is still liable for the balance of P500,000 unless there is a stipulation that the
assignment shall be in full satisfaction of all his debts.

1256 Tender of payment and consignation

(1) D owes C a sum of money. On the due date of the obligation, D offers to pay the obligation
but C refuses to accept the payment without any justifiable reason.

In this case, D’s obligation will not be extinguished until he has made a valid consignation.

(2) D entered into a contract with C. D is given the right to cancel the contract upon payment of
P1,000.00 to C.

In this case, D has no existing debt to C. The amount of P1,000.00 is not owed by D, being
merely the consideration for the exercise of his right to cancel the contract. Hence,
consignation of the P1,000.00 is not necessary. Tender of payment in good faith is sufficient to
entitle D to cancellation. (see Asturias Sugar Central vs. Pure Cane Molasses Co., 60 Phil. 255
[1934].)

(3) For failing to pay rents for three (3) months, R (lessor) demanded that E (lessee) pay the
back rentals and vacate the premises. Subsequently, R filed a complaint for unlawful detainer.
E contends that R refused to accept the rents.

The failure of R to collect or his refusal to accept the rentals is not a valid defense. To be
released from responsibility, the debtor should consign the thing or sum due. The belated
payment of the back rentals by E does not automatically restore the contract of lease without
R’s consent. (Cursino vs. Bautista, 176 SCRA 65 [1969]; see Cetus Development, Inc. vs.
Court of Appeals, 176 SCRA 72 [1989].)

1257 Consignation will not release the debtor from the obligation unless it has been first
announced to the creditor.

The purpose of the announcement is to give the creditor the opportunity to accept the tender of
payment and avoid unnecessary litigation.

Tender of payment and notice of consignation may be done in the same act, e.q., sending a
letter that should the creditor fail to accept the payment tendered, the debtor would
consign the amount in court.

2- notice rule

1.) Prior to the act of consignation

2.) After Actual act of deposit/ consignation

1258 Consignation, by depositing the thing or sum due with the proper judicial authority (i.e.,
court), is necessary to effect payment. It cannot be elsewhere (e.g., bank) unless otherwise
prescribed by special law.

A refuses to accept payment of B. B deposits payment to proper judicial authority, the court.

Article 1259. The expenses of consignation, when properly made, shall be charged against
the creditor.

EXAMPLE: A borrowed P100,000 from B. When A is about to pay, B just refused to accept
payment without just cause. A then settled the payment in court. Storage fees, filing fees,
attorney’s fees and other related expenses shall be borne by B.

Article 1260. Once the consignation has been duly made,
 the debtor may ask the judge to
order the cancellation of the obligation. Before the creditor has accepted the consignation,
 or
before a judicial declaration that the consignation has been properly made, the debtor may
withdraw the thing or the sum deposited,
 allowing the obligation to remain in force.

Wala talaga me mahanap na example dito pero medyo self explanatory naman sya,

ART. 1261. If, the consignation having been made, the creditor should authorize the debtor to
withdraw the same, he shall lose every preference which he may have over the thing. The co-
debtors, guarantors and sureties shall be released.

EXAMPLES:

(1) D is indebted to C in the sum of P10,000.00 with G as the guarantor. On the due date of
the obligation, D offered payment but C refused to accept the same. So, D made a
consignation. Subsequently, D withdrew the deposit after securing the consent of C.

Under Article 1261, C shall lose whatever preference he may have over the amount and G, the
guarantor, shall be released.

(2) If, in the example given, D and G are solidarily liable to C, G is released only from his
solidary liability but he is still liable to C for P5,000.00, his share in the obligation.

ART. 1262. An obligation which consists in the delivery of a determinate thing shall be
extinguished if it should be lost or destroyed without the fault of the debtor, and before he has
incurred in delay.

When by law or stipulation, the obligor is liable even for fortuitous events, the loss of the thing
does not extinguish the obligation, and he shall be responsible for damages. The same rule
applies when the nature of the obligation requires the assumption of risk.

EXAMPLE: A is obliged to deliver to B a birthday cake. While on the way to B’s house to
deliver the cake, a tsunami suddenly hit the city, destroying the birthday cake. Obligation to
deliver is already extinguished since the cause of the loss of the determinate thing is a
fortuitous event. However, if A still pushed to deliver the birthday cake despite knowing for
example that there is a storm signal # 4 in their area, and the cake is eroded by flood while on
their way, A can be liable because the situation already requires the assumption of risk.