Short answer. If nothing was stipulated and the goods produce no fruits or income, Article 1589 makes you owe interest only once you default, running from the time of judicial or extrajudicial demand for payment of the price — not from the date of delivery itself.
What the law says
The vendee shall owe interest for the period between the delivery of the thing and the payment of the price, in the following three cases: (1) Should it have been so stipulated; (2) Should the thing sold and delivered produce fruits or income; (3) Should he be in default, from the time of judicial or extrajudicial demand for the payment of the price.
Civil Code, Article 1589 — When the Vendee Owes Interest. Read the full provision →
Three separate triggers, and yours is the third
Article 1589 recognizes only three situations where a buyer owes interest on the unpaid price for the gap between delivery and payment. The vendee shall owe interest for the period between the delivery of the thing and the payment of the price, in the following three cases: (1) Should it have been so stipulated; (2) Should the thing sold and delivered produce fruits or income; (3) Should he be in default, from the time of judicial or extrajudicial demand for the payment of the price. Since your goods produce no fruits or income, the second case does not apply to you, and unless a stipulation exists, the first does not either.
Why the fruits-or-income case does not fit your goods
The second case exists because a buyer who is already enjoying income from the property — rent from land, produce from a farm, or similar returns — should not get to hold that income while delaying payment interest-free. Since what you bought generates nothing of that kind, this basis for owing interest simply has no factual basis to attach to in your situation, regardless of how much time has passed since delivery.
Default triggers interest, but only from demand onward
That leaves the third case: should he be in default, from the time of judicial or extrajudicial demand for the payment of the price. If you have not paid and no stipulation or fruit-producing situation applies, you only start owing interest once you are actually in default — and that default-based interest itself only counts from when a demand was made, whether that demand was made in court or simply through a written or verbal request outside of court. Interest does not silently accrue from the delivery date under this basis.
What this means for calculating what you owe
If no interest rate or interest obligation was written into your sale agreement, and the goods produce no income, you should look for the date of an actual demand — judicial or extrajudicial — as the starting point for any interest owed on the unpaid price, rather than assuming interest ran from the moment the goods were delivered to you. Confirming whether and when a demand was actually made is the key fact that determines whether, and from when, this third basis for interest applies to your purchase.
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.
- Jose Marques, et al. vs. Far East Bank and Trust Company, et al. / Far East Ban and Trust Company, et al. vs. Jose Marques, et al, G.R. No. 171379 / G.R. No. 171419, January 10, 2011 — read the decision on LawPhil →
- Violeta Espino vs. Normandy P. Amora, et al, G.R. No. 172816, March 3, 2008 — read the decision on LawPhil →
- Phil. Phosphate Fertilizer Corp. vs. Kamalig Resources Inc, G.R. No. 165608, December 13, 2007 — read the decision on LawPhil →
- Gregorio Fule vs. Court of Appeals, et al, G.R. No. 112212, March 2, 1998 — read the decision on LawPhil →