Short answer. Yes. Article 2210 of the Civil Code says interest may, in the discretion of the court, be allowed upon damages awarded for breach of contract. The court is not confined to a rate the parties fixed; it may add interest as part of making the injured party whole, judging what is proper on the facts.
What the law says
Interest may, in the discretion of the court, be allowed upon damages awarded for breach of contract.
Civil Code, Article 2210 — Discretionary Interest on Damages. Read the full provision →
Interest here is a matter of the court's discretion
There is a difference between interest the parties agreed on and interest a court may add on top of a damages award. This provision is about the second kind. It says interest may, in the discretion of the court, be allowed upon damages awarded for breach of contract. The word that governs is discretion. The court is not obliged to add interest, and it is not limited to a rate the contract happened to specify. It may allow interest as part of compensating the injured party, precisely because time has passed between the breach and the day the loss is finally paid.
Why the loss of time is compensated
The reason discretionary interest exists is that money awarded late is worth less than money that was owed on time. A party kept out of what it should have received has lost the use of that value while the dispute dragged on. Allowing interest on the damages recognises that delay and puts the injured party closer to where it would have stood had the obligation been met. Because it is compensatory rather than punitive, the court fits it to the case, considering the nature of the breach and the period the claimant was kept waiting, instead of applying a single automatic figure.
It applies even without an agreed rate
This is why a court can add interest even though you never pleaded a particular rate. The authority comes from the law's grant of discretion, not from a clause in your contract. Parties often do stipulate interest, and where they have, that agreement generally governs its own terms. But the absence of a stipulated rate does not strip the court of the power to allow interest on a damages award for breach. The claimant does not forfeit interest simply because the contract was silent on it; the discretion supplies what the parties left unaddressed.
What this does not promise
Discretion cuts both ways. Because the court may allow interest rather than must, there is no entitlement to it as of right, and a claimant should not assume interest will automatically be tacked on to every award. The rate, the starting point from which it runs, and whether to grant it at all are matters the court weighs, and separate rules and prevailing legal-interest standards guide how such interest is computed once allowed. The practical takeaway is narrower but useful: a court is free to add interest to your damages even if you never named a rate, so it is worth asking for it and explaining the delay you suffered.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Lara’s Gifts & Decors, Inc. vs. Midtown Industrial Sales, Inc, G.R. No. 225433, August 28, 2019 — read the decision on LawPhil →
- Delia B. Borreta as widow of deceased Manuela A. Borreta, Jr. vs. Evic Human, G.R. No. 224026, February 3, 2020 — read the decision on LawPhil →
- Camp John Hay Development Corporation vs. Charter Chemical and Coating Corporation, G.R. No. 198849, August 7, 2019 — read the decision on LawPhil →
- Philippine Commercial and International Bank vs. William Golangco Construction Corporation/William Golangco Construction Corporation, G.R. No. 195372 / G.R. No. 195375, April 10, 2019 — read the decision on LawPhil →