Article 2085 2123

Article 2085.
The following requisites are Neither can the creditor's heir who received his
essential to the contracts of pledge and share of the debt return the pledge or cancel
mortgage: the mortgage, to the prejudice of the other
heirs who have not been paid.
(1) That they be constituted to secure the
fulfillment of a principal obligation; From these provisions is excepted the case in
which, there being several things given in
(2) That the pledgor or mortgagor be the mortgage or pledge, each one of them
absolute owner of the thing pledged or guarantees only a determinate portion of the
mortgaged; credit.
(3) That the persons constituting the pledge or The debtor, in this case, shall have a right to the
mortgage have the free disposal of their extinguishment of the pledge or mortgage as
property, and in the absence thereof, that they the portion of the debt for which each thing is
be legally authorized for the purpose. specially answerable is satisfied. (1860)
Third persons who are not parties to the Article 2090. The indivisibility of a pledge or
principal obligation may secure the latter by mortgage is not affected by the fact that the
pledging or mortgaging their own property. debtors are not solidarily liable. (n)
(1857)
Article 2091. The contract of pledge or
Article 2086. The provisions of article 2052 are mortgage may secure all kinds of obligations, be
applicable to a pledge or mortgage. (n) they pure or subject to a suspensive or
Article 2087. It is also of the essence of these resolutory condition. (1861)
contracts that when the principal obligation Article 2092. A promise to constitute a pledge
becomes due, the things in which the pledge or or mortgage gives rise only to a personal action
mortgage consists may be alienated for the between the contracting parties, without
payment to the creditor. (1858) prejudice to the criminal responsibility incurred
Article 2088. The creditor cannot appropriate by him who defrauds another, by offering in
the things given by way of pledge or mortgage, pledge or mortgage as unencumbered, things
or dispose of them. Any stipulation to the which he knew were subject to some burden, or
contrary is null and void. (1859a) by misrepresenting himself to be the owner of
the same. (1862)
Article 2089. A pledge or mortgage is
indivisible, even though the debt may be CHAPTER 2 Pledge
divided among the successors in interest of the Article 2093. In addition to the requisites
debtor or of the creditor. prescribed in article 2085, it is necessary, in
Therefore, the debtor's heir who has paid a part order to constitute the contract of pledge, that
of the debt cannot ask for the proportionate the thing pledged be placed in the possession of
extinguishment of the pledge or mortgage as the creditor, or of a third person by common
long as the debt is not completely satisfied. agreement. (1863)
Article 2094. All movables which are within or employees with respect to the thing pledged.
commerce may be pledged, provided they are (n)
susceptible of possession. (1864)
Article 2101. The pledgor has the same
Article 2095. Incorporeal rights, evidenced by responsibility as a bailor in commodatum in the
negotiable instruments, bills of lading, shares of case under article 1951. (n)
stock, bonds, warehouse receipts and similar
documents may also be pledged. The Article 2102. If the pledge earns or produces
fruits, income, dividends, or interests, the
instrument proving the right pledged shall be
delivered to the creditor, and if negotiable, creditor shall compensate what he receives
with those which are owing him; but if none are
must be indorsed. (n)
owing him, or insofar as the amount may
Article 2096. A pledge shall not take effect exceed that which is due, he shall apply it to the
against third persons if a description of the principal. Unless there is a stipulation to the
thing pledged and the date of the pledge do not contrary, the pledge shall extend to the interest
appear in a public instrument. (1865a) and earnings of the right pledged.
Article 2097. With the consent of the pledgee, In case of a pledge of animals, their offspring
the thing pledged may be alienated by the shall pertain to the pledgor or owner of animals
pledgor or owner, subject to the pledge. The pledged, but shall be subject to the pledge, if
ownership of the thing pledged is transmitted there is no stipulation to the contrary. (1868a)
to the vendee or transferee as soon as the
Article 2103. Unless the thing pledged is
pledgee consents to the alienation, but the
latter shall continue in possession. (n) expropriated, the debtor continues to be the
owner thereof.
Article 2098. The contract of pledge gives a
right to the creditor to retain the thing in his Article 2113. At the public auction, the pledgor
or owner may bid. He shall, moreover, have a
possession or in that of a third person to whom
it has been delivered, until the debt is paid. better right if he should offer the same terms as
the highest bidder. The pledgee may also bid,
(1866a)
but his offer shall not be valid if he is the only
Article 2099. The creditor shall take care of the bidder. (n)
thing pledged with the diligence of a good
father of a family; he has a right to the Article 2114. All bids at the public auction shall
offer to pay the purchase price at once. If any
reimbursement of the expenses made for its
preservation, and is liable for its loss or other bid is accepted, the pledgee is deemed to
have been received the purchase price, as far as
deterioration, in conformity with the provisions
of this Code. (1867) the pledgor or owner is concerned. (n)
Article 2115. The sale of the thing pledged shall

Article 2100. The pledgee cannot deposit the
thing pledged with a third person, unless there extinguish the principal obligation, whether or
not the proceeds of the sale are equal to the
is a stipulation authorizing him to do so. The
pledgee is responsible for the acts of his agents amount of the principal obligation, interest and
expenses in a proper case. If the price of the
sale is more than said amount, the debtor shall and expenses, the remainder of the price of the
not be entitled to the excess, unless it is sale shall be delivered to the obligor. (n)
otherwise agreed. If the price of the sale is less,
Article 2122. A thing under a pledge by
neither shall the creditor be entitled to recover
the deficiency, notwithstanding any stipulation operation of law may be sold only after demand
of the amount for which the thing is retained.
to the contrary. (n)
The public auction shall take place within one
Article 2116. After the public auction, the month after such demand. If, without just
pledgee shall promptly advise the pledgor or grounds, the creditor does not cause the public
owner of the result thereof. (n) sale to be held within such period, the debtor
may require the return of the thing. (n)
Article 2117. Any third person who has any
right in or to the thing pledged may satisfy the Article 2123. With regard to pawnshops and
principal obligation as soon as the latter other establishments, which are engaged in
becomes due and demandable. (n) making loans secured by pledges, the special
laws and regulations concerning them shall be
Article 2118. If a credit which has been pledged observed, and subsidiarily, the provisions of this
becomes due before it is redeemed, the Title. (1873
pledgee may collect and receive the amount
due. He shall apply the same to the payment of
his claim, and deliver the surplus, should there
be any, to the pledgor. (n)
Article 2119. If two or more things are pledged,

the pledgee may choose which he will cause to
be sold, unless there is a stipulation to the
contrary. He may demand the sale of only as
many of the things as are necessary for the
payment of the debt. (n)
ARTICLE 2120. If a third party secures an

obligation by pledging his own movable
property under the provisions of article 2085 he
shall have the same rights as a guarantor under
articles 2066 to 2070, and articles 2077 to 2081.
He is not prejudiced by any waiver of defense
by the principal obligor. (n)
Article 2121. Pledges created by operation of

law, such as those referred to in articles 546,
1731, and 1994, are governed by the foregoing
articles on the possession, care and sale of the
thing as well as on the termination of the
pledge. However, after payment of the debt

Article 2085 2123

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Article 2085 2123

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Article 2085.

Article 2115. The sale of the thing pledged shall

Article 2119. If two or more things are pledged,

ARTICLE 2120. If a third party secures an

Article 2121. Pledges created by operation of

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