This case has been cited 4 times or more.
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2009-04-02 |
TINGA, J. |
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| It might seem that APT has no right to set-off payments with UPSUMCO for under Article 1279 (1), it is necessary for compensation that the obligors "be bound principally, and that he be at the same time a principal creditor of the other."[48] There is, concededly, no mutual creditor-debtor relation between APT and UPSUMCO. However, we recognize the concept of conventional compensation, defined as occurring "when the parties agree to compensate their mutual obligations even if some requisite is lacking, such as that provided in Article 1282."[49] It is intended to eliminate or overcome obstacles which prevent ipso jure extinguishment of their obligations.[50] Legal compensation takes place by operation of law when all the requisites are present, as opposed to conventional compensation which takes place when the parties agree to compensate their mutual obligations even in the absence of some requisites.[51] The only requisites of conventional compensation are (1) that each of the parties can dispose of the credit he seeks to compensate, and (2) that they agree to the mutual extinguishment of their credits.[52] | |||||
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2007-07-11 |
CARPIO, J. |
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| It might seem that APT has no right to set-off payments with United Planters for under Article 1279 (1), it is necessary for compensation that the obligors "be bound principally, and that he be at the same time a principal creditor of the other."[66] There is, concededly, no mutual creditor-debtor relation between APT and United Planters. However, our jurisdiction recognizes the concept of conventional compensation, defined as occurring "when the parties agree to compensate their mutual obligations even if some requisite is lacking, such as that provided in Article 1282."[67] It is intended to eliminate or overcome obstacles which prevent ipso jure extinguishment of their obligations.[68] Legal compensation takes place by operation of law when all the requisites are present, as opposed to conventional compensation which takes place when the parties agree to compensate their mutual obligations even in the absence of some requisites.[69] The only requisites of conventional compensation are (1) that each of the parties can dispose of the credit he seeks to compensate, and (2) that they agree to the mutual extinguishment of their credits.[70] | |||||
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2005-10-25 |
CARPIO, J. |
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| Compensation is a mode of extinguishing to the concurrent amount the debts of persons who in their own right are creditors and debtors of each other.[34] The object of compensation is the prevention of unnecessary suits and payments thru the mutual extinction by operation of law of concurring debts.[35] The requisites for legal compensation are provided in Article 1279 of the Civil Code:Art. 1279. In order that compensation may be proper, it is necessary: | |||||
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2002-01-02 |
QUISUMBING, J. |
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| Since petitioner's obligation to PNEI is payable on demand, and there being no demand made, it follows that the obligation is not yet due. Therefore, this obligation may not be subject to compensation for lack of a requisite under the law. Without compensation having taken place, petitioner remains obligated to PNEI to the extent stated in the promissory note. This obligation may undoubtedly be garnished in favor of respondent to satisfy PNEI's judgment debt.[9] (Citations appearing in the original omitted.) There is another alleged demand letter on record, dated January 24, 1990.[10] It was addressed to Atty. Domingo A. Santiago, Jr., Senior Vice President and Chief Legal Counsel of PNB, and signed by Manuel Vijungco, chairman of the Board of Directors of PNEI. In said letter, PNEI requested offsetting of accounts between petitioner and PNEI. However, PNEI's own Assistant General Manager for Finance at that time, Atty. Loreto N. Tang, testified that the letter was not a demand letter. [11] | |||||