1) The document discusses provisions from the Law on Credit Transactions regarding guarantors and sub-guarantors.
2) It provides that a guarantor can proceed against the principal debtor before paying under certain circumstances like insolvency of the debtor.
3) Among co-guarantors, one who pays may demand proportionate shares from the others, but if any are insolvent their shares are divided among the solvent co-guarantors. A sub-guarantor is similarly liable to co-guarantors as the guarantor they guaranteed.
1) The document discusses provisions from the Law on Credit Transactions regarding guarantors and sub-guarantors.
2) It provides that a guarantor can proceed against the principal debtor before paying under certain circumstances like insolvency of the debtor.
3) Among co-guarantors, one who pays may demand proportionate shares from the others, but if any are insolvent their shares are divided among the solvent co-guarantors. A sub-guarantor is similarly liable to co-guarantors as the guarantor they guaranteed.
1) The document discusses provisions from the Law on Credit Transactions regarding guarantors and sub-guarantors.
2) It provides that a guarantor can proceed against the principal debtor before paying under certain circumstances like insolvency of the debtor.
3) Among co-guarantors, one who pays may demand proportionate shares from the others, but if any are insolvent their shares are divided among the solvent co-guarantors. A sub-guarantor is similarly liable to co-guarantors as the guarantor they guaranteed.
1) The document discusses provisions from the Law on Credit Transactions regarding guarantors and sub-guarantors.
2) It provides that a guarantor can proceed against the principal debtor before paying under certain circumstances like insolvency of the debtor.
3) Among co-guarantors, one who pays may demand proportionate shares from the others, but if any are insolvent their shares are divided among the solvent co-guarantors. A sub-guarantor is similarly liable to co-guarantors as the guarantor they guaranteed.
Law on Credit and Transactions Art. 2071 LAW ON CREDIT TRANSACTION
The guarantor, even before having paid,
may proceed against the principal debtor:
In case of insolvency of the principal
1 When he is sued for the payment; 2 debtor; When the debtor has bound himself When the debt has become to relieve him from the guaranty 3 4 demandable, by reason of the within a specified period, and this expiration of the period for payment; period has expired; If there are reasonable grounds to After the lapse of ten years, when the 6 fear that the principal debtor intends principal obligation has no fixed period for to abscond; 5 its maturity, unless it be of such nature that it If the principal debtor is in cannot be extinguished except within a period 7 imminent danger of becoming longer than ten years; insolvent.
In all these cases, the action of the guarantor is to obtain release from the guaranty, or to demand a security that shall protect him from any proceedings by the creditor and from the danger of insolvency of the debtor. (1834a) Art. 2071 LAW ON CREDIT TRANSACTION
AS A GENERAL RULE, THE GUARANTOR HAS NO The purpose of this
CAUSE OF ACTION AGAINST THE DEBTOR UNTIL title is to enable the guarantor to take measures for the AFTER THE FORMER HAS PAID THE OBLIGATION. protection of his interest in view of the probability that (Art. 2066.) NONETHELESS, THE 7 AFOREMENTIONED ARE INSTANCES WHEN THE GUARANTOR CAN he would be called upon to pay the debt. The provisions PROCEED AGAINST THE DEBTOR REMEDY TO WHICH of Article 2071 are applicable and available to the GUARANTOR ENTITLED surety.
Art. 2066 Art. 2071
Enforcement of rights of guarantor against debtor Before he has paid but after he becomes liable after he paid Right of action after payment Protective remedy before payment Art. 2072 LAW ON CREDIT TRANSACTION
Art. 2072. If one, at the request of another,
becomes a guarantor for the debt of a third person who is not present, the guarantor who satisfies the debt may sue either the person so requesting or the debtor for reimbursement. (n) Art. 2073 LAW ON CREDIT TRANSACTION
SECTION 3. - Effects of Guaranty as Between Co- Guarantors Art. 2073. When there are two or more guarantors of the same debtor and for the same debt, the one among them who has paid may demand of each of the others the share which is proportionally owing from him. If any of the guarantors should be insolvent, his share shall be borne by the others, including the payer, in the same proportion. The provisions of this Art. shall not be applicable, unless the payment has been made by virtue of a judicial demand or unless the principal debtor is insolvent. (1844a) 1 2
If D becomes insolvent, the right of G,
H, and I to proportionate division of G, H, and I are D’s their obligation ceases as far as C is concerned. C may demand payment guarantors of a debt of of the entire obligation from any of the P9,000.00 in favor of C. guarantors. If G pays the whole debt of P9,000.00 he can later demand from H and I P3,000.00 each.
3 4
If the benefit of division ceases for
But if H is insolvent, his share reasons other than the insolvency of shall be borne by G and I the principal debtor, the right to proportionately. reimbursement granted to G against H Under paragraph 2, G can, and I may only be exercised if G makes therefore, demand P4,500.00 payment in virtue of a judicial demand from I. by C. Art. 2074 | Art. 2075 LAW ON CREDIT TRANSACTION
Art. 2074. In the case of the
preceding article, the co- guarantors may set up against the one who paid, the same Art. 2075. A sub-guarantor, in defenses which would have case of the insolvency of the pertained to the principal guarantor for whom he bound debtor against the creditor, himself, is responsible to the and which are not purely co-guarantors in the same personal to the debtor. (1845) terms as the guarantor. (1846)
Defense available to co-guarantors:
all defenses the debtor would have against creditor but not those which are purely personal r nto antor uara gua r ntor co-g -g u ara co
This "say the line, Bart" meme pertains to common spiels
t or used by "sad bois" between conversations. Bart (sub- ra n sub -gua guarantor) is a literal sad boi since he is a guarantor of a guarantor. Hence, he is liable to the co-guarantors in the same manner as the guarantor (see Art. 2074.) whom he guaranteed ako na muna ang bahalang magbayad
