Commodatum notes

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Commodatum

A.General Concepts

Civil Code, Article 1933

By the contract of loan, one of the parties delivers to another, either

something not consumable so that the latter may use the same for a

certain time and return it, in which case the contract is called a

commodatum; or money or other consumable thing, upon the condition that

the same amount of the same kind and quality shall be paid, in which

case the contract is simply called a loan or mutuum.

Commodatum is essentially gratuitous.

Simple loan may be gratuitous or with a stipulation to pay interest.

In commodatum the bailor retains the ownership of the thing loaned, while

in simple loan, ownership passes to the borrower.

B.Object of commodatum


Consumable goods may be the subject of commodatum if the purpose ofthe contract is not the consumption of the object, as when it is merely for

exhibition.


Movable or immovable property may be the object of commodatum.

Case:Producers Bank vs. CA GR 115324, February 19, 2003

Held: If consumable goods are loaned only for purposes of exhibition, or

when the intention of the parties is to lend consumable goods and to

have the very same goods returned at the end of the period agreed upon,

the loan is a commodatum and not a mutuum.


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The rule is that the intention of the parties thereto shall be accorded

primordial consideration in determining the actual character of a

contract. In case of doubt, the contemporaneous and subsequent acts of

the parties shall be considered in such determination.

C.Consideration in commodatum


xxx


Civil Code, Article 1935The bailee in commodatum acquires the used of the thing loaned but not its

fruits; if any compensation is to be paid by him who acquires the use, the

contract ceases to be a commodatum.


Commodatum is purely personal in character. Consequently:

(1) The death of either the bailor or the bailee extinguishes the contract;

(2) The bailee can neither lend nor lease the object of the contract to a third

person. However, the members of the bailee's household may make use of

the thing loaned, unless there is a stipulation to the contrary, or unless the

nature of the thing forbids such use.

D. Parties to a commodatum

1. Ownership by bailor

Civil Code, Article 1938The bailor in commodatum need not be the owner of the thing loaned.


xxx In commodatum the bailor retains the ownership of the thing

loaned, while in simple loan, ownership passes to the borrower.


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1.Use by bailee


The bailee in commodatum acquires the used of the thing loaned butnot its fruits; if any compensation is to be paid by him who acquires the

use, the contract ceases to be a commodatum.

Civil Code, Article 1939, par. 2

Commodatum is purely personal in character. Consequently:

xxx

(2) The bailee can neither lend nor lease the object of the contract to athird person. However, the members of the bailee's household may

make use of the thing loaned, unless there is a stipulation to the

contrary, or unless the nature of the thing forbids such use.

2.Solidary liability of bailees


When there are two or more bailees to whom a thing is loaned in thesame contract, they are liable solidarily.

A.Liability for expenses and damages

1.Ordinary expenses





commodatum; or money or other consumable thing, upon the condition

that the same amount of the same kind and quality shall be paid, in

which case the contract is simply called a loan or mutuum.



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In commodatum the bailor retains the ownership of the thing loaned,

while in simple loan, ownership passes to the borrower.


The bailee in commodatum acquires the used of the thing loaned but

not its fruits; if any compensation is to be paid by him who acquires the

use, the contract ceases to be a commodatum.


The bailee is obliged to pay for the ordinary expenses for the use and preservation of the thing loaned.


The bailee does not answer for the deterioration of the thing loaned due

only to the use thereof and without his fault.

Case:Pajuyo vs. CA GR 146364, June 3, 2004

Held: In a contract of commodatum, one of the parties delivers toanother something not consumable so that the latter may use the

same for a certain time and return it. An essential feature of

commodatum is that it is gratuitous. Another feature of commodatum

is that the use of the thing belonging to another is for a certain

period. Thus, the bailor cannot demand the return of the thing loaned

until after expiration of the period stipulated, or after accomplishment

of the use for which the commodatum is constituted. If the bailor

should have urgent need of the thing, he may demand its return for

temporary use. If the use of the thing is merely tolerated by the bailor,

he can demand the return of the thing at will, in which case the

contractual relation is called a precarium. Under the Civil Code,

precarium is a kind of commodatum. The Kasunduan reveals that the

accommodation accorded by Pajuyo to Guevarra was not essentially

gratuitous. While the Kasunduan did not require Guevarra to pay

rent, it obligated him to maintain the property in good condition. The


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imposition of this obligation makes the Kasunduan a contract

different from a commodatum. The effects of the Kasunduan are also

different from that of a commodatum. Case law on ejectment has

treated relationship based on tolerance as one that is akin to a

landlord-tenant relationship where the withdrawal of permission

would result in the termination of the lease. The tenant’s withholding

of the property would then be unlawful.

2.Extraordinary expenses


The bailor shall refund the extraordinary expenses during the contract

for the preservation of the thing loaned, provided the bailee brings the

same to the knowledge of the bailor before incurring them, except when

they are so urgent that the reply to the notification cannot be awaited

without danger.

If the extraordinary expenses arise on the occasion of the actual use of

the thing by the bailee, even though he acted without fault, they shall

be borne equally by both the bailor and the bailee, unless there is a

stipulation to the contrary.

3.Other expenses


If, for the purpose of making use of a thing, the bailee incurs expenses

other than those referred to in Article 1941 and Article 1949, he is not

entitled to reimbursement.

4.Abandonment by bailor


The bailor cannot exempt himself from the payment of expenses ordamages by abandoning the thing to the bailee.

B.Liability for loss



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commodatum; or money or other consumable thing, upon the condition that

the same amount of the same kind and quality shall be paid, in which

case the contract is simply called a loan or mutuum.



In commodatum the bailor retains the ownership of the thing loaned, while

in simple loan, ownership passes to the borrower.


The bailee is liable for the loss of the thing, even if it should be through a

fortuitous event:

(1)If he devotes the thing to any purpose different from that for which it

has been loaned;

(2)If he keeps it longer than the period stipulated, or after the

accomplishment of the use for which the commodatum has been

constituted;

(3)If the thing loaned has been delivered with appraisal of its value,

unless there is a stipulation exemption the bailee from responsibility in

case of a fortuitous event;

(4)If he lends or leases the thing to a third person, who is not a member of

his household;

(5) If, being able to save either the thing borrowed or his own thing, he

chose to save the latter.

Case:Republic vs. Bagtas GR L-17474, October 25, 1962(copied fromhttps://thelawiscool.wordpress.com/2014/02/20/republic-v-bagtas/ )

https://thelawiscool.wordpress.com/2014/02/20/republic-v-bagtas/https://thelawiscool.wordpress.com/2014/02/20/republic-v-bagtas/https://thelawiscool.wordpress.com/2014/02/20/republic-v-bagtas/


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Facts: Bagtas borrowed three bulls from the Bureau of Animal Industry

for one year for breeding purposes subject to payment of breeding fee of

10% of book value of the bull. Upon expiration, Bagtas asked for renewal.

The renewal was granted only to one bull. Bagtas offered to buy the bulls

at its book value less depreciation but the Bureau refused. The Bureau

said that Bagtas should either return or buy it at book value. Bagtas

proved that he already returned two of the bulls, and the other bull died

during a Huk raid, hence, obligation already extinguished. He claims

that the contract is a commodatum hence, loss through fortuitous event

should be borne by the owner.

Issue: WON Bagtas is liable for the death of the bull.

Held: Yes. Commodatum is essentially gratuitous. However, in this case,

there is a 10% charge. If this is considered compensation, then the case

at bar is a lease. Lessee is liable as possessor in bad faith because the

period already lapsed.

Even if this is a commodatum, Bagtas is still liable because the

fortuitous event happened when he held the bull and the period

stipulated already expired and he is liable because the thing loaned was

delivered with appraisal of value and there was no contrary stipulationregarding his liability in case there is a fortuitous event

C.Obligation to return

1.General concepts


The bailor cannot demand the return of the thing loaned till after theexpiration of the period stipulated, or after the accomplishment of the

use for which the commodatum has been constituted. However, if in the

meantime, he should have urgent need of the thing, he may demand its

return or temporary use.


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In case of temporary use by the bailor, the contract of commodatum is

suspended while the thing is in the possession of the bailor.


The bailor may demand the thing at will, and the contractual relation is

called a precarium, in the following cases:

(1)If neither the duration of the contract nor the use to which the thing

loaned should be devoted, has been stipulated; or

(2) If the use of the thing is merely tolerated by the owner.


The bailor may demand the immediate return of the thing if the bailee

commits any act of ingratitude specified in Article 765.

Case:Quintos & Ansaldo vs. Beck GR L-46240, November 3, 1939

Held: The contract entered into between the parties is one

of commadatum, because under it the plaintiff gratuitously granted

the use of the furniture to the defendant, reserving for herself the

ownership thereof; by this contract the defendant bound himself to

return the furniture to the plaintiff, upon the latter’s demand. The

obligation voluntarily assumed by the defendant to return the

furniture upon the plaintiff's demand, means that he should return

all of them to the plaintiff at the latter's residence or house. The

defendant did not comply with this obligation when he merely placed

them at the disposal of the plaintiff, retaining for his benefit the three

gas heaters and the four electric lamps. The provisions of article 1169

of the Civil Code cited by counsel for the parties are not squarely

applicable. The trial court, therefore, erred when it came to the legalconclusion that the plaintiff failed to comply with her obligation to get

the furniture when they were offered to her.

As the defendant had voluntarily undertaken to return all the

furniture to the plaintiff, upon the latter's demand, the Court could

not legally compel her to bear the expenses occasioned by the deposit


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of the furniture at the defendant's behest. The latter, as bailee, was

not entitled to place the furniture on deposit; nor was the plaintiff

under a duty to accept the offer to return the furniture, because the

defendant wanted to retain the three gas heaters and the four electric

lamps.

As to the value of the furniture, we do not believe that the plaintiff is

entitled to the payment thereof by the defendant in case of his

inability to return some of the furniture because under paragraph 6 of

the stipulation of facts, the defendant has neither agreed to nor

admitted the correctness of the said value. Should the defendant fail

to deliver some of the furniture, the value thereof should be latter

determined by the trial Court through evidence which the parties may

desire to present.

2.Right of retention of bailee


The bailee cannot retain the thing loaned on the ground that the bailor

owes him something, even though it may be by reason of expenses.

However, the bailee has a right of retention for damages mentioned in

Article 1951.


The bailor who, knowing the flaws of the thing loaned, does not advise

the bailee of the same, shall be liable to the latter for the damages

which he may suffer by reason thereof.

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Commodatum notes