OBLIGATION OF PLEDGEE NOT TO USE THING PLEDGED

Category: Obligations and Contracts

OBLIGATION OF PLEDGEE NOT TO USE THING PLEDGED

Art.  2104.  The  creditor  cannot  use  the  thing  pledged, without the authority of the owner, and if he should do so, or should misuse the thing in any other way, the owner may ask  that  it  be  judicially  or  extrajudicially  deposited.  When the  preservation  of  the  thing  pledged  requires  its  use,  it must  be  used  by  the  creditor  but  only  for  that  purpose. (1870a)

>  The pledgee who is in possession of the thing pledged has no  right  to  make  use  of  it  without  permission  from  the owner
>  If  however,  the  thing  pledged  is  of  such  a  character  that use is necessary in properly caring for it, then it becomes his duty to use it so that it will not suffer from its disuse—if from the use thereof profits are derived, the pledgee must account  such  profits  to  the  pledgor  and  apply  the  net proceeds of such use to the payment of his claim

RIGHT  OF  THE  PLEDGOR  TO  ASK  THE  THING  PLEDGED  TO BE DEPOSITED

1.   If the creditor uses the thing without authority
2.   If he misuses the thing in any other way
3.   If the thing is in danger of being lost or impaired because of the negligence or willful act of the pledgee