Short answer. Yes, legal interest, running from when you told the borrower. Article 2066 includes in the guarantor's indemnity the legal interests thereon from the time the payment was made known to the debtor, even though it did not earn interest for the creditor. So notice to the borrower starts your interest clock.
What the law says
The legal interests thereon from the time the payment was made known to the debtor, even though it did not earn interest for the creditor
Civil Code, Article 2066 — Guarantor's Right to Indemnity. Read the full provision →
Interest is part of the indemnity you are owed
When you pay a debt as guarantor, the borrower must indemnify you, and that indemnity is not limited to the plain amount you handed over. Article 2066 lists interest as one of its components. Among what the borrower owes you is the legal interests thereon — that is, legal interest on the sum you paid. So the answer to whether you can charge the borrower interest is yes: the law treats interest on your payment as something the borrower owes you back, over and above returning the principal you advanced on his behalf. You are meant to be made whole, and interest is part of being made whole.
The interest runs from when you told the borrower
The article is specific about the starting point. The legal interest runs from the time the payment was made known to the debtor. It is not measured from the day you happened to pay the creditor, but from the day you informed the borrower that you had paid. This makes prompt notice to the borrower valuable to you: the sooner you let him know you paid, the sooner your interest begins to accrue. A guarantor who pays but stays silent may find that his interest only starts later, when the borrower is finally made aware.
It applies even if the debt itself bore no interest
One striking feature of this rule is that your right to interest does not depend on the original debt having carried interest. The article grants the legal interest even though it did not earn interest for the creditor. So even if the borrower's loan was interest-free as between him and the creditor, you as the paying guarantor may still recover legal interest on what you paid, counted from when you made the payment known. The interest here is your entitlement as the person who advanced the money, not a carry-over of whatever interest terms the underlying loan may or may not have had.
The limits worth keeping in mind
This is legal interest on the amount you actually paid, not a licence to impose whatever rate you like on the borrower. The figure is the legal interest the law fixes, applied from the date of notice. Your broader recovery under the same article can also include the debt itself, qualifying expenses and damages where due, but the interest component specifically is governed by the words above. To protect it in full, keep proof of what you paid and of when and how you informed the borrower, since that date of notice is what determines how far back your interest reaches.
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.
- Luis Juan L. Virata and UEM-Mara Philippines Corporation vs. Alejandro Ng Wee Westmont Investment Corp., et al./Westmont Investment, Corporation vs. Alejandro Ng Wee/Manuel Estrella vs. Alejandro Ng Wee/Simeon Cua, et al. vs. Alejandro Ng Wee/Anthony T. Reyes vs. Alejandro Ng Wee, et al, G.R. No. 220926 / G.R. No. 221058 / G.R. No. 221109 / G.R. No. 221135 / G.R. No. 221218, July 5, 2017 — read the decision on LawPhil →
- Vil-Rey Planners and Builders vs. Lexber, Inc./Stronghold Insurance Company, Inc. vs. Lexber, Inc, G.R. No. 189401 / G.R. No. 189447, June 15, 2016 — read the decision on LawPhil →
- Philippine National Construction Corporation vs. Asiavest Merchant Bankers (M) Berhad, G.R. No. 172301, August 19, 2015 — read the decision on LawPhil →
- CCC Insurance Corporation vs. Kawasaki Steel Corporation, et al, G.R. No. 156162, June 22, 2015 — read the decision on LawPhil →