Credit Transactions Case Digest: Republic V.

Bagtas (1962)
G.R. No. L-17474 October 25, 1962

Laws Applicable: Commodatum

Lessons Applicable:

FACTS:
May 8, 1948: Jose V. Bagtas borrowed from the Republic of the Philippines through the Bureau of
Animal Industry three bulls: a Red Sindhi with a book value of P1,176.46, a Bhagnari, of P1,320.56 and
a Sahiniwal, of P744.46, for a period of 1 year for breeding purposes subject to a breeding fee of 10%
of the book value of the bulls
May 7, 1949: Jose requested for a renewal for another year for the three bulls but only one bull was
approved while the others are to be returned
March 25, 1950: He wrote to the Director of Animal Industry that he would pay the value of the 3 bulls
October 17, 1950: he reiterated his desire to buy them at a value with a deduction of yearly
depreciation to be approved by the Auditor General.
October 19, 1950: Director of Animal Industry advised him that either the 3 bulls are to be returned or
their book value without deductions should be paid not later than October 31, 1950 which he was not
able to do
December 20, 1950: An action at the CFI was commenced against Jose praying that he be ordered to
return the 3 bulls or to pay their book value of P3,241.45 and the unpaid breeding fee of P199.62, both
with interests, and costs
July 5, 1951: Jose V. Bagtas, through counsel Navarro, Rosete and Manalo, answered that because of
the bad peace and order situation in Cagayan Valley, particularly in the barrio of Baggao, and of the
pending appeal he had taken to the Secretary of Agriculture and Natural Resources and the President
of the Philippines, he could not return the animals nor pay their value and prayed for the dismissal of
the complaint.
RTC: granted the action
December 1958: granted an ex-parte motion for the appointment of a special sheriff to serve the writ
outside Manila
December 6, 1958: Felicidad M. Bagtas, the surviving spouse of Jose who died on October 23, 1951
and administratrix of his estate, was notified
January 7, 1959: she file a motion that the 2 bulls where returned by his son on June 26, 1952
evidenced by recipt and the 3rd bull died from gunshot wound inflicted during a Huk raid and prayed
that the writ of execution be quashed and that a writ of preliminary injunction be issued.
ISSUE: W/N the contract is commodatum and NOT a lease and the estate should be liable for
the loss due to force majeure due to delay.

HELD: YES. writ of execution appealed from is set aside, without pronouncement as to costs
If contract was commodatum then Bureau of Animal Industry retained ownership or title to
the bull it should suffer its loss due to force majeure. A contract of commodatum is
essentially gratuitous. If the breeding fee be considered a compensation, then the
contract would be a lease of the bull. Under article 1671 of the Civil Code the lessee would
be subject to the responsibilities of a possessor in bad faith, because she had continued
possession of the bull after the expiry of the contract. And even if the contract be
commodatum, still the appellant is liable if he keeps it longer than the period stipulated
the estate of the late defendant is only liable for the sum of P859.63, the value of the bull
which has not been returned because it was killed while in the custody of the
administratrix of his estate
Special proceedings for the administration and settlement of the estate of the deceased
Jose V. Bagtas having been instituted in the CFI, the money judgment rendered in favor of
the appellee cannot be enforced by means of a writ of execution but must be presented to
the probate court for payment by the appellant, the administratrix appointed by the court.

C ommodatum Defined

Art. 1933: By the contract of loan, one of the parties delivers to another 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. xxx

- the bailee acquires the use of the thing loaned but not its fruits (Art. 1935), EXCEPT if the parties
stipulate use of fruits (Art. 1940)

Pajuyo v. CA, G.R. No. 146364, June 3, 2004

Pajuyo purchased the rights over a property from Pedro Perez. Thereafter, he constructed a
house and he and his family lived there. Later, Pajuyo agreed to let Guevarra live in the house
for free provided that Guevarra maintain cleanliness and orderliness of the house. They also
agreed that Guevarra should leave upon demand. But when Pajuyo later told Guevarra that
he needed the house, Guevarra refused, hence an ejectment case was filed.

Supreme Court held that the contract is not a commodatum. In a contract of commodatum,
one of the parties delivers to another 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.

Mina v. Pascual, 25 Phil 540

Francisco is the owner of land and he allowed his brother, Andres, to erect a warehouse in
that lot. Both Francisco and Andres died and their children became their respective heirs:
Mina for Francisco and Pascual for Andres. Pascual sold his share of the warehouse and lot.
Mina opposed because the lot is hers because her predecessor (Francisco) never parted with
its ownership when he let Andres construct a warehouse, hence, it was a contract of
commodatum. What is the nature of the contract between Francisco and Andres?

The Supreme Court held that it was not a commodatum. It is an essential feature of
commodatum that the use of the thing belonging to another shall be for a certain period. The
parties never fixed a definite period during which Andres could use the lot and afterwards
return it.

NOTA B EN E : It would seem that the Supreme Court failed to consider the possibility of a
contract of precardium between Francisco and Andres. Precardium is a kind of commodatum
wherein the bailor may demand the object at will if the contract does not stipulate a period or
use to which the thing is devoted.