Dear IBP Davao,
I have a question about a friend of mine who borrowed money from another friend. The latter, who is the creditor, imposed an interest of twenty percent (20%). My friend, the debtor, tried to pay the debt. However, due to the COVID-19 pandemic, the debtor was removed from his employment and was not able to pay the remaining balance. Now my question Attorney, will the debtor be imprisoned for non-payment of debt, including the interest? Thank you!
- Concerned Friend
Dear Concerned friend,
A debtor is obliged to pay his creditor the loan that he had incurred as it falls due. However, no person can be imprisoned merely by reason of non-payment of debt. This guarantee is expressly provided for under Section 20, Article III of the 1987 Philippine Constitution which states: “No person shall be imprisoned for debt or non-payment of poll tax.” This provision is anchored on personal liberty by prohibiting the practice of either sending the debtor to jail or making the debtor personal slaves for failing to pay the debts. But it must be clear that this has something to do with purely civil debts.
To give you a clearer view about this matter, “debt” refers to any civil obligations arising from contracts, express or implied. An obligation to pay arising from extra contractu is considered a private matter between the creditor and the debtor and no criminal action to enforce the former’s right to recover will lie. The remedy of the creditor is a civil action for the recovery of the unpaid debt. Since the action is civil in nature, however, there is no way that the debtor may be imprisoned. The purpose of the action is for the creditor to avail itself of the compulsory processes of the court to force the debtor to pay.
While no person may be imprisoned for nonpayment of debt, an obligation acquired through fraud may be criminally prosecuted. In such case, the fraudulent act of securing the debt, and not his default in paying it, is punishable. The obligation arises from acts ex-delicto and is therefore not considered a debt under the constitutional provision.
Applying the above-mentioned laws, your debtor-friend cannot be imprisoned solely on the basis of his non-payment of debt, including the interest. However, if it can be discovered later on that the obligation was acquired through fraud, then he may be criminally liable.
(IBP Davao Corner is a weekly column of Integrated Bar of the Philippines- Davao Chapter, giving legal advice as part of its legal aid program. The above legal opinion is based solely on the appreciation of the facts and problem given and stated above. The opinion may vary when other facts, circumstances, and situations are stated. You may send your comments and questions to ibpdavao@gmail.com)
