OVERVIEW

1. Characteristics and requisites 2. Comparison to pledge and real mortgage 3. Rights of the antichretic debtor and creditor 4. Duties of the antichretic debtor and creditor 5. Remedies of the creditor 6. Jurisprudence

ARTICLE 2132
By the contract of antichresis the creditor acquires the right to receive the fruits of an immovable of his debtor, with the obligation to apply them to the payment of the interest, if owing, and thereafter to the principal of his credit.

CHARACTERISTICS
1. Accessory > secures performance of a principal obligation 2. Formal > the principal obligation and the interest secured must be in writing

REQUISITES
1. Covers only the fruits of an immovable property 2. Delivery by debtor is necessary 3. Express agreement that creditor is given the right to receive the fruits of the property 4. Should be in writing to be valid

COMPARISON
ANTICHRESIS
Property involved Real

PLEDGE
Personal

REAL MORTGAGE
Real

Perfection
Possession Right of Creditor Taxes/Charges Fruits

Mere Consent
Creditor Personal Right Creditor Applied

By Delivery
Creditor Personal Right n/a n/a

Mere Consent
Debtor Real Right n/a n/a

ARTICLE 2133
The actual market value of the fruits at the time of the application thereof to the interest and principal shall be the measure of such application.

DEFINITION RECALL
Fruits
> natural (spontaneous products of the soil) > industrial (products of the land through cultivation / labor > civil (rent / annuities)

Market Value
> the

market value of an article or piece of property is the price that it might be expected to bring if offered for sale in a fair market; not the price that might be obtained on a sale at public auction or a sale forced by the necessities of the owner, but such a price as would be fixed by negotiation and mutual agreement, after ample time to find a purchaser.

ARTICLE 2134
The amount of the principal and of the interest shall be specified in writing; otherwise, the contract of antichresis shall be void.

Article 1356 (FORM OF CONTRACTS) ...when the law requires that a contract be in some form in order that it may be valid or enforceable, or that a contract be proved in a certain way, that requirement is absolute and indispensable...

ARTICLE 2135
The creditor, unless there is a stipulation to the contrary, is obliged to pay the taxes and charges upon the estate. He is also bound to bear the expenses necessary for its preservation and repair. The sums spent for the purposes stated in this article shall be deducted from the fruits.

X = $FRUITS $TAXES $CHARGES $PRESERVATION EXPENSES - $REPAIR - $INTEREST - $PRINCIPAL X = $X,XXX.XX Balance to be returned to debtor

ARTICLE 2136
The debtor cannot reacquire the enjoyment of the immovable without first having totally paid what he owes the creditor.

But the latter, in order to exempt himself from the obligations imposed upon him by the preceding article, may always compel the debtor to enter again upon the enjoyment of the property, except when there is a stipulation to the contrary.

ARTICLE 2137
The creditor does not acquire the ownership of the real estate for non-payment of the debt within the period agreed upon.

Every stipulation to the contrary shall be void. But the creditor may petition the court for the payment of the debt or the sale of the real property. In this case, the Rules of Court on the foreclosure of mortgages shall apply.

OBLIGATION OF THE ANTICHRETIC CREDITOR

To pay taxes and charges on the estate, including the necessary expenses; To apply all the fruits in payment of interest if owing, and thereafter to the principal; To render an account of the fruits to the debtor; To bear the expenses necessary for the preservation and repair.

OBLIGATION OF THE ANTICHRETIC DEBTOR The property delivered stands as a security for the
payment of the obligation of the debtor in antichresis. Hence, the debtor cannot demand its return until the debt is totally paid..

REMEDIES OF THE CREDITOR

1. Bring an action for specific performance 2. Petition for the sale of the real property as in a foreclosure of mortgages under Rule 68 of the Rules of Court. 3. Agree with the antichretic debtor on extrajudicial foreclosure.

ARTICLE 2138
The contracting parties may stipulate that the interest upon the debt be compensated with the fruits of the property which is the object of the antichresis, provided that if the value of the fruits should exceed the amount of interest allowed by the laws against usury, the excess shall be applied to the principal.

X = $FRUITS $TAXES $CHARGES $PRESERVATION EXPENSES - $REPAIR - $INTEREST - $PRINCIPAL X = $X,XXX.XX Balance to be returned to debtor

ARTICLE 2139
The last paragraph of Article 2085, and Articles 2089 to 2091 are applicable to this contract.

Art. 2085 > antichretic debtor be absolute owner, at free disposal, or legally authorized Art. 2089-90 > indivisibility of antichresis Art. 2091 > can secure all types of obligations

CASE 1
EDIT

CASE 2
EDIT