No One can be Imprisoned for Non-Payment of Debt

Perhaps you’ve heard someone making threats to file criminal cases against debtors who fail to pay. On the other hand, perhaps you’ve heard about the rule that no one can be imprisoned simply because of a debt in the Philippines. The prohibition against imprisonment for a debt is a basic right enshrined in no less than the Philippine Constitution (Article III):

“No person shall be imprisoned for debt or non-payment of a poll tax.”

The Supreme Court explained the rationale for this prohibition in the case of Lozano vs. Martinez:

. . . Viewed in its historical context, the constitutional prohibition against imprisonment for debt is a safeguard that evolved gradually during the early part of the nineteenth century in the various states of the American Union as a result of the people’s revulsion at the cruel and inhumane practice, sanctioned by common law, which permitted creditors to cause the incarceration of debtors who could not pay their debts. At common law, money judgments arising from actions for the recovery of a debt or for damages from breach of a contract could be enforced against the person or body of the debtor by writ of capias ad satisfaciendum. By means of this writ, a debtor could be seized and imprisoned at the instance of the creditor until he makes the satisfaction awarded. As a consequence of the popular ground swell against such a barbarous practice, provisions forbidding imprisonment for debt came to be generally enshrined in the constitutions of various states of the Union.

This humanitarian provision was transported to our shores by the Americans at the turn of the century and embodied in our organic laws. Later, our fundamental law outlawed not only imprisonment for debt, but also the infamous practice, native to our shore, of throwing people in jail for non-payment of the cedula or poll tax.

In other words, no one can be compelled to pay a debt under pain of criminal sanctions (estafa is a different matter). No one can be imprisoned for non-payment of debt. The remedy of the creditor is civil in nature.

Let’s examine some laws that were questioned, albeit unsuccessfully, on the ground that these laws violate the constitutional prohibition against non-imprisonment for debt.

Bouncing checks

Bouncing Checks Law (BP 22) does not punish the non-payment of an obligation. The law is not designed to coerce a debtor to pay his debt. The thrust of the law is to prohibit, under pain of penal sanctions, the making of worthless checks and putting them in circulation. Checks have become widely accepted as a medium of payment in trade and commerce, and if the confidence in checks is shaken,  the usefulness of checks as currency substitutes would be greatly diminished. When the question was resolved in 1986, it had been reported that the approximate value of bouncing checks per day was close to 200 Million Pesos, thereafter averaging between P50 to P80 Million a day. (Lozano vs. Martinez)

Trust receipts

The same argument was raised against the Trust Receipts Law (Presidential Decree No. 115). The passage of P.D. 115 is a declaration by the legislative authority that, as a matter of public policy, the failure of a person to turn over the proceeds of the sale of goods covered by a trust receipt (or to return said goods if not sold) is a public nuisance to be abated by the imposition of penal sanctions.

It punishes the dishonesty and abuse of confidence in the handling of money or goods to the prejudice of another. The law does not seek to enforce payment of a loan. (Tiomico vs. CA)

Credit cards

Under the Access Devices Regulation Act of 1998 (Republic Act No. 8484), anyone who obtains “money or anything of value through the use of an access device, with intent to defraud or with intent to gain and fleeing thereafter” is criminally liable.

R.A. 8484 provides for a presumption: a cardholder who abandons or surreptitiously leaves the place of employment, business or residence stated in his application or credit card, without informing the credit card company of the place where he could actually be found, if at the time of such abandonment or surreptitious leaving, the outstanding and unpaid balance is past due for at least 90 days and is more than P10,000, shall be prima facie presumed to have used his credit card with intent to defraud.” We are still waiting for the test case on this.

333 thoughts on “No One can be Imprisoned for Non-Payment of Debt

  1. Napz

    May outstanding balance po ako hindi ko pa nabayaran sa kdahilanan na gipit pa po ako ngayun,umutang po ako ng isang appliances sa isang sikat na appliances store at dahil sa ingganyo ng sales clerk ay napakuha po ako ng wlang downpayment tru sa isang agency,at ang contract na pinirmahan ko ay mula december 2017-march 2019,or 15 months ko syang huhulogan sa pagbayad,kaso last november 2018 pa po ang last ko bayad tru bayad center,at until now hindi ko na po nabyaran ang monthly hulog ko doon,at patuloy po ang send ng text message nila about my balance hanngang sa nag send sila ng mga warning message na ngsasabing pag di ko raw nabayaran ay they will take legal action…ang tanong ko po ay possible po ba ako makulong kung sakali hindi ko pa nabayaran hanngang matapos ang march 2019 next month? Please need your advise.thanks. Napz

    Reply
  2. Reagan

    Good day! Meron po akong existing auto/car loan with Eastwest Bank. Mula ng narelease siya saken di ko na po nabayaran yung monthly amort niya starting 1st month dahil nawalan ako ng trabaho. Bale down payment lang po talaga. Bale 5 months unpaid na po siya. Natatakot po ksi ako dahil may pananakot yung collection agent at dethreat saken. Makukulong po ba ako nito or dapat ko na lang isurrender yung unit? Ngayon po kasi pwede ko na mabayaran pakonte-konte yung balance since back to work na ako. Salamat po sa advise?

    Reply
  3. grace

    hi ask ko lang po marami po akong utang online lending hindi po ako nakakabayad at tumataas ang interest nang hindi ko pagbayad. tanong ko lang po kung hindi pa ako nakakabayad dahil sa financial problem po pposibilidad po na makulong ako sa hindi pagbayad sa online lending. please give me advise. Nakikipag usap naman ako na unti unti ko bayaran sila kaso ayaw po nila pumayag ang gusto nila buo na babayaran mo at kasama interest. Natatakot na po ako kasi po kung makukulong kawawa naman mga anak ko. Sana mabigyan niyo po ako nang advise

    Reply
  4. may

    mgndang arw po mkukulong pob ang tao once n ngmit ang srli nyang facebook acct.gnmit kc ng dati kong aswa facebook ko nanloko sya naipost nko s facebook s hlgng 1k n ipinadla nung muslim n mg aswa pero lalki ang ngpdla and d kopo cla kilala or namimit p tntnkot nla ako n makukulong ako n ipppot nla ako sna msgot nyopo s hlgng 1,000 e makukulong pob ako and po pla gusto mangyri ng mag aswa pra idelete ung post ung 1k n ipndla dw nla e gwing 10k un lng dw kilngn pra mtpos

    Reply
  5. Juan

    Hi guys, mag join po kayo sa pinoyexchange.com blog para ma advise kayo at magkaroon ng idea tungkol sa mga unpaid debt lalo na sa credit card. lahat po ng katanungan ninyo doon mo makukuha ang sagot basahin lang ang trend simula sa umpisa.

    Reply
  6. confused2019A

    how can i file a case sa taong nangutang na di marunong magbayad? Formerly we had an illicit affair because this guy is already have a live in partner but they are not married around 17yrs, and then currrently i ask him about the payment her live in partner replied nung una mga foul words sinasabi, kesyu babayaran ako then it took lengthy conversation puros foul words na cnasabi which sakin cge ok lng importante bayaran ako kasi hiniram ko lng din po yung pera, meron din na pera na ng anak namin napahiram ko na my pera din sya hiniram sa sister ko using my name, Gusto ko lng po katarungan kasi inamin nman nya po my utang sya pero to nowhere hindi na sya nakipag usap….
    Please help me to find justice! He even abandone our child no appearance, no financial assitance.
    thanks,
    Confused 2019A

    Reply
  7. Jhon

    Paano po kapag ang utang ay sa mga online loan at sa online application? Ano ang mangyayari? Kapag hindi nakapagbayad, may mga online loan kasi na nangharaas, at ginagamit ang CIC para lang magbayad ka. Ano ba ang puwedeng ikaso sa mga ganoon? At puwede din bang mablacklisted ka sa NBI kapag hindi ka nagbayad ng utang?

    Reply
  8. dhing

    problema ko din ang homecredit di na ako nakakabayad,pero kalma lang ako kasi di naman ako makukulong sa utang,hindi ako magtatago bakit criminal ba ako?bayad ko na ang principal amount of 53,000 pesos bago ako mawalan ng income,benta man nila ang account ko sa law office wala akong paki,yung tubo na 53k sa principal amount supposedly 103k lahat babayaran ko sa kanila gaagwin ko nalang installment total tubo nalang yun,sampahan man nila ako ng kaso bahala sila tangapin nila 1k ko for 53 mos o hindi i dont care anymore kulong nila ako so gooo onnnn masaya nga libre ako pagkain sa correctional.ay sus wag po kayo matakot balikan nyo din sila sindakan lang yan.

    Reply
  9. JANICE

    Ask q po? Pag Hindi ka po ba nakapag byad. Magkakarun na po ba ng record sa NBI or sa POLICE? natatakot po kc aqng kumuha eh kaya di aq nakapag work ung utang q po kc Kay home credit Nung 2015 pa po un… Nung time po na kumuha aq magkasama pa po Kami ng asawa q tapus ngaun po kc single mom na aq kaya need q po mag work natatakot po kc aqng kumuha eh… Bka po kc bigla nlng aqng damputin. Pa help nmn po qng naka record na po cxa sa NBI or POLICE? Slmat poh…

    Reply
  10. Fie

    Hello. Good day! Ask ko lang po. May utang po kasi ang sister ko sa isang lending company. Nakapagbayad naman po siya ng partial. Then, ngayon po hinaharass po siya ng agent ng lending company. Threatening her up to the point na kasali na family niya at mga anak idadamay. Tama po ba ginagawa nila? Nadelay lang ng bayad dahil nagipit. Hindi naman po tatakbuhan ng sister ko ang utang nila. Ano po ang dapat gawin? Kasi nagtext daw po na sabi ipopost nila sa facebook ang family ng sister ko. Damay pa ang mga anak nila. At marami na rin po reklamo pala sa lending company na ito, kasi mahilig pala sila mangharass ng client tuwing nadedelay ng bayad… Advise po kung ano dapat gawin ng sister ko? At ano po dapat sabihin niya doon sa nagtetext sa kanya. Hintayin ko po. Maraming salamat.

    Reply
  11. Merly

    Magandang gabi po…tanong qu lang po nagloan po kc aqu kay robo cash pero wala po aqu nkuha na pera..ngaun qu lng po nlaman na my repayment due na po aqu….

    Reply

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