Attorney’s Fees in the Philippines: Article 2208 and Fee Clauses
Recovering attorney’s fees after a breach of contract in the Philippines: how attorney’s-fee clauses work, when courts reduce them, and why a breach alone is not bad faith.
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Liquidated Damages vs Penalty Clauses
Quick answer: Both clauses fix financial consequences in advance, but their function and wording matter. Liquidated damages estimate compensation for breach, while a penalty clause principally secures performance. Courts examine substance rather than labels and may reduce an iniquitous or unconscionable amount. G.R. No. 249247 also explains how stipulated forfeiture or liquidated damages may operate…
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Specific Performance vs Resolution vs Damages
Quick answer: If the other party substantially fails to perform a reciprocal contract, Article 1191 generally allows the injured party to choose between fulfillment or specific performance and resolution, with damages potentially recoverable in either case. Related: Not sure which remedy fits your situation? See remedies for non-payment or non-performance, organised by what was promised…
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Resolution Under Article 1191: When Can a Reciprocal Contract Be Cancelled?
Quick answer: Article 1191 of the Civil Code allows the injured party in a reciprocal obligation to choose between fulfillment and resolution, with damages potentially recoverable in either case. Resolution generally requires a substantial breach—not merely a slight, casual, or technical failure. What Article 1191 means Article 1191 of the Civil Code applies to reciprocal…
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Specific Performance in the Philippines: Can a Court Force Contract Performance?
Quick answer: Yes. A court may order specific performance when a valid and enforceable obligation is due, the claimant has performed or is ready to perform, and the promised act remains legally and practically possible. As illustrated by Universal Food Corp. v. Court of Appeals, the remedy is not automatic, especially when performance has become…
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How Is a Security Interest Perfected and Given Priority?
Quick answer: Under the Personal Property Security Act, a security interest must first attach to collateral and then be perfected by the method the law recognizes. Registration is common, while possession or control applies to particular assets. Priority usually turns on the applicable PPSA priority rule and timing—not simply on which loan agreement was signed…
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Personal Property Security Act: Using Movable Assets as Collateral
Quick answer: Republic Act No. 11057 provides a modern system for using personal property—such as equipment, inventory, receivables, deposit accounts, and other movable assets—as collateral. A security agreement creates the interest between the parties; perfection makes the security interest effective against third parties, commonly through registration, possession, or control. What the PPSA changes Concept Practical…
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Real Estate Mortgage in the Philippines: Validity, Registration, and Enforcement
Quick answer: A real estate mortgage secures a principal obligation with immovable property. The mortgagor must own the property and have capacity to dispose of it. The mortgage should be recorded in the Registry of Deeds to bind third persons, and the lender cannot simply appropriate the property after default. Core validity checks Question Why…
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Can a Guarantor Be Required to Pay Immediately?
Understand when an ordinary guarantor may require exhaustion of the debtor’s assets and when the creditor can proceed directly.
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Guaranty vs Suretyship in the Philippines: What Is the Difference?
Learn why an ordinary guarantor is generally secondarily liable while a surety binds itself solidarily with the principal debtor.
