CHAPTER IV, SEC.

3 – Condonation or Remission of Debt (Articles 1270-1274)

SECTION 3
CONDONATION OR REMISSION OF DEBT
(Arts. 1270-1274)

STUDY GUIDE : SESSION 11

1. What is condonation or remission?

 Condonation or remission is the gratuitous abandonment by the

creditor of his right. It is, in effect, a donation. (Art. 1270)

Example : Edna owes Remie P120,000.00. When the debt matured,

Edna told Remie that she need not pay the debt, since Edna was condoning or
remitting the same. Remie agreed and expressed her appreciation to Edna.
Here, the debt of Remie has already been extinguished by a mode of payment
known as condonation or remission.

 Express Condonation to Comply with Forms of Donation. –

Under the law, “if the value of the personal property donated exceeds five
thousand pesos, the donation and the acceptance shall be in writing. Otherwise,
the donation shall be void.” (Article 478, NCC.) And for a donation of an
immovable to be valid, “it must be made in a public instrument, specifying therein
the property donated and the value of the charges which the donee must satisfy.
The acceptance must be made in the same deed of donation or in a separate
public instrument, but it shall not take effect unless it is done during the lifetime of
the donor.” (Article 478, NCC.)

 Implied Condonation. – There is implied condonation if, through

the act or conduct of the creditor, the intent on his part to condone the debt can
be deduced. For instance, the delivery by the creditor to the debtor of the
document evidencing a credit is one such act. (Article 1271, NCC.) Thus, if the
payee of a promissory note destroys it or delivers it to the maker, there is an
implied renunciation of the credit.

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 CASES:
(1) Yam vs. Court of Appeals, G.R. No. 104726, February 11, 1999.
(2) Manila Surety & Fidelity Co., Inc. vs. Almeda,
G.R. No. L-27249, July 31, 1970.
(3) Trans-Pacific Industrial Suppies, Inc. vs. CA,
G.R. No. 109172, August 19, 1994.

2. Here are some practical presumptions related to condonation or remission :

(a) Presumption of voluntary delivery - When the private document in

which the debt appears is found in the possession of the debtor, it shall be
presumed that the creditor voluntarily delivered the document to the debtor.
(Art. 1272)

(b) Presumption of remission of the principal obligation – When the private

document in which the debt appears is voluntarily delivered by the creditor to the
debtor, it shall be presumed that the creditor is condoning or remitting the debt in
favor of the debtor. (Art. 1271, par. 1)

(c) Presumption of remission of the accessory obligation – When the thing

pledged, after its delivery to the creditor, is found in the possession of the debtor,
or of a third person who owns the thing, it shall be presumed that the creditor has
remitted the debtor’s accessory obligation under the accessory contract of
pledge. (Art. 1274)

3. Effects of the foregoing presumptions :

(a) These are merely disputable presumptions. The creditor can always
present evidence to prove the contrary.

(b) In Art. 1274, only the accessory obligation of pledge, and not the
principal obligation, is remitted. Hence, the debtor is still indebted to the
creditor but there is no more security. This provision adheres to the rule
that “accessory follows the principal”. This is further reiterated in Art.
1273 which states that the remission of the accessory obligation does

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not remit the principal obligation, but the remission of the principal
obligation also remits the accessory obligation.

APPLICATION/PROBLEMS :

1. On March 15, 2016, Ryan signed a promissory note with the following
tenor: “I promise to pay the amount of P50,000.00 to Judy on August 12, 2016.”
Judy took hold of the promissory note so that she has evidence of the unpaid
debt of Ryan. On May 25, 2016, a burglar entered the house of Judy, and stole
some valuables. On that occasion, Judy lost the promissory note signed by
Ryan. On August 12, 2016, Judy then went to Ryan to collect his P50,000.00
debt. To Judy’s surprise, Ryan was already in possession of the promissory
note, and refused to pay his obligation. Ryan told Judy that since he was already
in possession of the promissory note, it is presumed that he had already paid his
debt of P50,000.00, and there was nothing Judy could do about it. Is Ryan’s
position tenable?

2. On April 15, 2016, Nick borrowed P100,000.00 from Paul payable on

August 30, 2016. As security for the loan, Nick pledged his antique coffee table
worth P150,000.00 to Paul, and immediately delivered the table to Paul. On July
15, 2016, Paul received, as a birthday gift, a European coffee table with chairs
from his son in Europe. As a consequence, Paul requested his nephew to
deliver back to Nick the pledged antique coffee table to give space to the new
one. On August 30, 2016, Paul went to the house of Nick, and demanded
payment of the P100,000.00 debt as agreed upon. Nick, however, refused to
pay the P100,000.00 on the ground that when Paul returned the antique coffee
table which Nick had delivered to him as a pledge, Paul had in effect condoned
Nick’s indebtedness. Is Nick’s argument correct?

*** END ***

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FOOD FOR THOUGHT

Self-discipline is an act of cultivation.

It requires you to connect today’s
actions to tomorrow’s results. There’s
a season for sowing, a season for
reaping. Self-discipline helps you
know which is which.
Gary Ryan Blair

I see my upbringing as a great success

story. By disciplining me, my parents
inculcated self-discipline. And by
restricting my choices as a child, they
gave me so many choices in my life as
an adult. Because of what they did
then, I get to do the work I love now.
Amy Chua

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