The creditor will not take payment: releasing yourself by consignment

It is Section One of Chapter II of Title II of Book Four of the Civil Code of 2020, Articles 1131 to 1137. It is the remedy of a debtor who wants to pay and cannot because the creditor will not cooperate, cannot be found, cannot be identified, or the document was lost.

Any debtor in one of the four cases of Article 1131. In obligations to do, only in the first two: the creditor’s unreasonable refusal, or absence or incapacity to receive.

• Being in one of the four cases of Article 1131: unreasonable refusal, the creditor’s absence or incapacity, several persons claiming to collect, or loss of the title of the obligation.Verified against the official source
• Previously announcing the consignment to the persons interested in performance of the obligation.Verified against the official source
• Strictly meeting the requirements of payment: complete, the thing owed, and not in pieces, unless the contract or the law authorize it.Verified against the official source
• Making the deposit of what is owed, and notifying it afterwards to the interested persons.Verified against the official source

• The record of the prior announcement to the persons interested in performance.
• Evidence of the deposit before the court: if money, in the court’s account; if an immovable, the title placed with the competent court.
• The record of the notification of the deposit to the interested persons.

1. 1

   Step 1: The four cases where it lies

   Article 1131 lists them: the debtor is released from liability by consignment or by the offer of the performance owed if the creditor to whom the offer of payment is made unreasonably refuses to accept it; if the creditor is absent or incapacitated to receive the payment; if several persons claim a right to collect; or if the title of the obligation has been lost. Outside those four, this remedy is not available.

2. 2

   Step 2: The three things that must be met

   Article 1132 allows no shortcuts: for the consignment of the thing owed to release the obligor, all three requirements must concur. It must be previously announced to the persons interested in performance; it must strictly meet the requirements of payment; and it must be made by depositing what is owed. If one is missing, it does not release.

3. 3

   Step 3: Where the deposit goes, by what you owe

   Article 1133 separates it. If the thing consigned is money, it is deposited in the court’s account, before which the deposit is evidenced. If it is another movable that is not money, it may remain with the debtor or be deposited with a third party, and in both cases the thing must be placed at the creditor’s disposal. If it is an immovable, consignment is made by placing the title, if any, with the competent court, or by evidencing the abandonment where appropriate, and from that moment it is at the creditor’s disposal.

4. 4

   Step 4: The court may move or sell the thing

   The same article allows it: the court, before which the deposit is evidenced, may order a change of depositary or its sale at auction if the thing cannot be preserved or if its deposit causes excessive expense. And it closes with the step most often forgotten: once made and evidenced before the court, the deposit must also be notified to the interested persons.

5. 5

   Step 5: If what you owe is a service

   Article 1134 simplifies it: the person bound to a performance of doing is released if they satisfy subsections (a) or (b) of Article 1131 — the unreasonable refusal, or the creditor’s absence or incapacity — and show their willingness and capacity to perform, where the creditor’s active cooperation is required for it. Nothing has to be deposited.

6. 6

   Step 6: Asking the court to declare it good

   Article 1135 allows it: once the consignment is duly made, the debtor may ask the court to determine the sufficiency of the payment and order the obligation cancelled. That is the close of the procedure.

7. 7

   Step 7: It can be undone, and at what price

   Article 1136 opens and closes the door. While the creditor has not accepted the consignment, or no judicial declaration of sufficiency has been made, the debtor may withdraw the thing or amount consigned, leaving the obligation subsisting. And if, once the consignment is made, the creditor authorizes the debtor to withdraw it, the creditor loses every preference they have over the thing, and the co-debtors and sureties are released. Authorizing the withdrawal costs the creditor dearly.

8. 8

   Step 8: The sanction on the creditor who refused unreasonably

   Article 1137 sets it: if the consignment takes place because the creditor unreasonably refuses to receive the payment and the court determines the consignment is well made, it will impose on the creditor an economic sanction not exceeding five per cent (5%) of the value of the performance, without prejudice to costs and fees and the damages caused. The five per cent is a statutory ceiling, not an automatic amount; who pays costs and fees is decided by the court under rules this guide did not read.

Before the Court of First Instance: that is where the deposit is evidenced, where the declaration of sufficiency is requested, and where the sanction in Article 1137 is imposed if it applies. The Code publishes no filing fee for it and this guide invents none: we did not read the court’s procedural rules or fee schedule here.

• Consigning without being in one of the four cases of Article 1131.
• Depositing without first announcing it to the persons interested in performance.
• Consigning less than what is owed: the consignment must strictly meet the requirements of payment.
• Depositing the money in any account: if it is money, it goes into the court’s account.
• Forgetting to notify the deposit to the interested persons after evidencing it.
• Believing consignment cancels the debt by itself: the court must be asked for the declaration of sufficiency.
• Withdrawing what was consigned in the belief the obligation is already dead: on withdrawal it subsists.
• As creditor, authorizing the withdrawal without weighing the cost: every preference over the thing is lost and co-debtors and sureties are released.

These are the government pages this guide is based on.

• Poder Judicial de Puerto Rico

  Poder Judicial

  bvirtualogp.pr.gov