Article 2108-2115 - Copy 1

ARTICLE 2108 - 2115
ARTICLE 2108
ART. 2108. If, without the fault of the pledgee, there is danger of destruction, impairment,
or diminution in value of the thing pledged, he may cause the same to be sold at a public
sale. The proceeds of the auction shall be a security for the principal obligation in the same
manner as the thing originally pledged. (n)
 Right of pledgee to cause sale of thing pledged.

ARTICLE 2109
ART. 2109. If the creditor is deceived on the substance or quality of the thing pledged, he
may either claim another thing in its stead, or demand immediate payment of the principal
obligation. (n)
 Right of pledgee to demand substitute or immediate payment

1. to claim another thing in pledge
2. to demand immediate payment of the principal obligation
ARTICLE 2110
ART. 2110. If the thing pledged is returned by the pledgee to the pledgor or owner, the
pledge is extinguished. Any stipulation to the contrary shall be void.
If subsequent to the perfection of the pledge, the thing is in the possession of the pledgor or
owner, there is a prima facie presumption that the same has been returned by the pledgee.
This same presumption exists if the thing pledged is in the possession of a third person who
has received it from the pledgor or owner after the constitution of the pledge. (n)
ARTICLE 2110
 Extinguishment of pledge by return of thing pledged.

 Presumption of extinguishment of pledge.
ARTICLE 2111
ART. 2111. A statement in writing by the pledgee that he renounces or abandons the pledge
is sufficient to extinguish the pledge. For this purpose, neither the acceptance by the pledgor
or owner, nor the return of the thing pledged is necessary, the pledgee becoming a
depositary. (n)
 Extinguishment of pledge by renunciation or abandonment.

ARTICLE 2112
ART. 2112. The creditor to whom the credit has not been satisfied in due time, may proceed
before a Notary Public to the sale of the thing pledged. This sale shall be made at a public
auction, and with notification to the debtor and the owner of the thing pledged in a proper
case, stating the amount for which the public sale is to be held. If at the first auction the
thing is not sold, a second one with the same formalities shall be held; and if at the second
auction there is no sale either, the creditor may appropriate the thing pledged. In this case he
shall be obliged to give an acquittance for his entire claim. (1872a)
ARTICLE 2112
 Right of pledgee to cause sale of thing pledged

Formalities required for sale:
1. The debt is due and unpaid
2. The sale must be at a public auction
3. There must be notice to the pledgor and owner, stating the amount due
4. The sale must be made with the intervention of a notary public
 Right of pledgee to appropriate thing pledged

ARTICLE 2113
ART. 2113. At the public auction, the pledgor or owner may bid. He shall, moreover, have a
better right if he should offer the same terms as the highest bidder.
The pledgee may also bid, but his offer shall not be valid if he is the only bidder. (n)
 Right of pledgor and pledgee to bid at public sale

ARTICLE 2114
ART. 2114. All bids at the public auction shall offer to pay the purchase price at once. If any
other bid is accepted, the pledgee is deemed to have received the purchase price, as far as
the pledgor or owner is concerned. (n)
 Bid must be for cash

ARTICLE 2115
ART. 2115. The sale of the thing pledged shall extinguish the principal obligation, whether
or not the proceeds of the sale are equal to the 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 not be entitled to the excess, unless it is otherwise agreed. If the price of the sale is
less, neither shall the creditor be entitled to recover the deficiency, notwithstanding any
stipulation to the contrary. (n)
ARTICLE 2115
 Effect of sale of thing pledged

 Right of debtor to excess
 Right of creditor to recover deficiency

Article 2108-2115 - Copy 1

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ARTICLE 2108 - 2115

 Right of pledgee to cause sale of thing pledged.

 Right of pledgee to demand substitute or immediate payment

 Extinguishment of pledge by return of thing pledged.

 Extinguishment of pledge by renunciation or abandonment.

 Right of pledgee to cause sale of thing pledged

 Right of pledgee to appropriate thing pledged

 Right of pledgor and pledgee to bid at public sale

 Bid must be for cash

 Effect of sale of thing pledged

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