PLEDGE vs. CHATTEL MORTGAGE vs.

REAL ESTATE MORTGAGE

REAL ESTATE
ATTRIBUTE PLEDGE CHATTEL MORTGAGE
MORTGAGE

Perfection Delivery Consent Consent

Things placed as security Movable Movable Immovable

Cannot be included, except by

stipulation, those replacement
After-acquired properties
Cannot be included goods in retail stores and those Can be included by stipulation
included as security
acquired using the proceeds of
the goods mortgaged

After-incurred obligations to Can be secured if stipulated Can be secured if stipulated

Cannot be secured
be secured and once determined and once determined

Conduct of sale Public only Public or private (if stipulated) Public or private (if stipulated)

Entitlement to the excess in Pledgee, unless stipulated or

Mortgagor Mortgagor
the proceeds legal pledge

Not allowed, even if Allowed, unless covered by

Recovery of deficiency Allowed
stipulated, unless legal pledge Recto Law
Equity of redemption only
None, but pledgor can prevent
(pay the principal obligation Equity of redemption and right
Redemption the public auction by paying
plus costs to prevent the of redemption
the principal obligation
foreclosure sale)

POWER OF COOPERATIVE

Power of the CooperativeLEGAL Availability

Vote Required from the
BASIS IN CC or IRR Vote Required from the Members of Right to
Board of Directors
Withdraw30
¾ of all members with voting rights,
77
Merger or consolidation NONE PRESENT AND CONSTITUTING A Yes
QUORUM
Amendment of articles of 2/3 of ALL members with voting
NONE Yes
cooperation18 rights
2/3 of ALL members with voting
Amendment of bylaws18 NONE Yes
rights
¾ of all members with voting rights,
Division20 NONE PRESENT AND CONSTITUTING A No
QUORUM
¾ of all members with voting rights,
Voluntary dissolution where no
Majority of ALL members PRESENT AND CONSTITUTING A No
creditors are affected118
QUORUM
Voluntary dissolution where Majority of ALL members ¾ of all members with voting rights, No
 PRESENT AND CONSTITUTING A
creditors are affected119
QUORUM
Filling up a vacancy, other than by Majority of ALL members with voting
expiration of term, in the board of Majority of the rights, PRESENT AND
directors41 REMAINING directors (if CONSTITUTING A QUORUM No
(e.g. death, resignation, withdrawal, still constituting majority) (if the remaining directors do not
removal) constitute majority)
Upon recommendation of
majority of all members Majority of all members with voting
Deferment of payment of inters on
PRESENT AND rights, PRESENT AND No
share capital12, IRR
CONSTITUTING A CONSTITUTING A QUORUM
QUORUM
Removal of a member for cause30 Majority of ALL members NONE No
Delegation of powers to an executive
Majority of ALL members NONE No
committee43
Placing an elected officer under
preventive suspension pending the
Majority of ALL members NONE No
resolution of the investigation on his
removal50
Majority of all members
Filling up a vacancy in the PRESENT AND
NONE No
committees CONSTITUTING A
QUORUM
Majority of all members
Allocation of interest on share PRESENT AND
NONE No
capital12, IRR CONSTITUTING A
QUORUM
Majority of all members
Recommending to the general
PRESENT AND
assembly the removal of an elected NONE No
CONSTITUTING A
officer50
QUORUM
¾ of all members with voting rights,
Delegation of the delegable powers
NONE PRESENT AND CONSTITUTING A No
of the general assembly33
QUORUM
Ratification of contracts with ¾ of all members with voting rights,
selfdealing directors, officers, or NONE PRESENT AND CONSTITUTING A No
committee members47 QUORUM
¾ of all members with voting rights,
Ratification of a director’s act of
NONE PRESENT AND CONSTITUTING A No
disloyalty48
QUORUM
Removal of an elected officer upon ¾ of all members with voting rights,
recommendation of the board of NONE PRESENT AND CONSTITUTING A No
directors50 QUORUM
Filling up a vacancy due to
Majority of ALL members with voting
expiration of term or resignation of a
NONE rights, PRESENT AND No
holdover director in the board of
CONSTITUTING A QUORUM
directors41
Granting the directors any Majority of ALL members with voting
NONE No
compensation other than per diems46 rights

POWER OF CORPORATION
Power of the Corporation Vote Required Vote Required from the Right of Availability of
 from the Holders of
Appraisal
Board of Stockholders/Members Non-Voting
Right
Directors Shares to Vote
Extend or shorten corporate Yes, by
Majority 2/3 Yes81
term37 implication6
Yes, if it
changes or
restricts the right
of shareholders
Amendment of articles of or shares, or
Majority 2/3 Yes6
incorporation16 authorizes
preferences
superior to
outstanding
shares81
Sale or other disposition of
all or substantially all of its Majority 2/3 Yes6 Yes81
assets40
Investment of corporate
funds in another corporation
Majority 2/3 Yes6 Yes42
or business or for any other
purpose42
Merger or consolidation77 Majority 2/3 Yes6 Yes81
Increase or decrease capital
Majority 2/3 Yes6 No
stock38
Incur, create or increase
Majority 2/3 Yes6 No
bonded indebtedness38
Voluntary dissolution where
Majority 2/3 Yes6 No
no creditors are affected118
Voluntary dissolution where
Majority 2/3 Yes6 No
creditors are affected119
Declare stock dividends43 Majority 2/3 No No
Amendment to the plan of
Majority 2/3 No No
merger or consolidation77
2/3, in case of good faith
issuance of shares in
exchange for property needed
Deny pre-emptive right39 Majority No No
for corporate purposes or in
payment of a previously
contracted debt
Yes, including
Amendment of by-laws48 Majority Majority No
adoption6
Enter into management Majority Majority; or No No
contract44
2/3, ((1) where a stockholder
or stockholders representing
the same interest of both the
managing and the managed
corporations own or control
more than 1/3 of the total
outstanding capital stock in
the managing corporation; or
 (2) where a majority of the
members of the board of
directors of the managing
corporation also constitute a
majority of the members of
the board of directors of the
managed corporation)
Acquire own shares41 Majority Non N/ N/
e A A
Declare cash or property
Majority None N/A N/A
dividends43

CONTRACTS

REVIVAL OF
KINDS OF CREDITOR’S ORIGINAL
ORIGINAL NEW EFFECT OF
SUBSTITUTION CONSENT OBLIGATION IN
DEBTOR’S DEBTOR’S PAYMENT BY NEW
(PERSONAL (indispensable CASE OF NEW
CONSENT CONSENT DEBTOR
NOVATION) requirement) DEBTOR’S
INSOLVENCY
No revival, UNLESS
Right to reimbursement
the insolvency was
(how much was paid by
DELEGACION Yes Yes Yes already existing and of
the new debtor) and
public knowledge or
subrogation
known to the debtor
Right to BENEFICIAL
reimbursement (how
EXPROMISION Yes No Yes No revival
much was beneficial to
the original debtor)
NOTES:
- Novation is NEVER presumed. The creditor must clearly agree that the original debtor will be released from the original
obligation.
- While the extinguishment of the principal obligation results to the extinguishment of accessory obligations, those accessory
obligations which are BENEFICIAL TO THIRD PERSONS who did not consent to the novation may still subsist.
- If the new obligation is void, there is no novation, and the original one shall subsist.
- A void obligation cannot be novated; but a VOIDABLE obligation may be novated.
- If the original obligation is subject to a suspensive or resolutory condition, the new obligation is deemed subject to the
SAME CONDITION unless there is a contrary stipulation.