Commodatum Notes

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 of
the 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.
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
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.
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
The 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.
1. Use by bailee
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.
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 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.
2. Solidary liability of bailees
When there are two or more bailees to whom a thing is loaned in the
same 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.

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 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. 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
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 tenants 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 or
damages by abandoning the thing to the bailee.
B. Liability for loss

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
https://thelawiscool.wordpress.com/2014/02/20/republic-v-bagtas/ )
(copied from
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 stipulation
regarding 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 the
expiration 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.
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 latters 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 legal
conclusion 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
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.

Commodatum Notes

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Commodatum

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

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

Civil Code, Article 1941

imposition of this obligation makes the Kasunduan a contract

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

Civil Code, Article 1942

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

Civil Code, Article 1948

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

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