Short answer. The one you designated when you paid. Article 1252 gives the debtor the first choice: he may declare, at the time of making the payment, to which debt it must be applied. Say nothing and the choice passes on, and a receipt you accept can settle it against you.

What the law says

He who has various debts of the same kind in favor of one and the same creditor, may declare at the time of making the payment, to which of them the same must be applied.

Civil Code, Article 1252 — Application of Payments. Read the full provision →

What the law says

If the debtor accepts from the creditor a receipt in which an application of the payment is made, the former cannot complain of the same, unless there is a cause for invalidating the contract.

Civil Code, Article 1252 — Application of Payments. Read the full provision →

The choice is yours, but only at the moment of payment

Article 1252 of the Civil Code opens with the debtor's right: He who has various debts of the same kind in favor of one and the same creditor, may declare at the time of making the payment, to which of them the same must be applied. The timing is the whole of it. The declaration belongs to the act of paying, not to a call the following week when you discover the supplier credited the invoice you least wanted settled. Write the invoice number on the payment instruction, the covering letter and the deposit slip, and keep the copy that shows you did.

The receipt can decide it for you

The article's last sentence is the trap: If the debtor accepts from the creditor a receipt in which an application of the payment is made, the former cannot complain of the same, unless there is a cause for invalidating the contract. Taking the official receipt without objection ratifies whatever allocation it records. Suppliers routinely apply payments to the oldest account, or to the one closest to prescribing, or to the unsecured one. Read the receipt when it arrives rather than filing it, and if it credits the wrong invoice, object in writing straight away.

Debts not yet due are normally off limits

There is a limit on which accounts can be touched at all. Article 1252 provides that unless the parties so stipulate, or when the application is made by the party for whose benefit the term has been constituted, application shall not be made as to debts which are not yet due. A creditor therefore cannot ordinarily reach across and credit your payment to next quarter's billing while the past-due invoices sit open. If several accounts are overdue, however, they are all fair game and the designation matters that much more.

What happens when nobody chose

Where neither party made an application, the Code supplies one. Article 1253 comes first: if the debt produces interest, payment of the principal is not deemed made until the interests have been covered, so accrued interest is taken before anything reduces the balance. Article 1254 then applies the payment to the most onerous debt among those due, and where the debts are of the same nature and burden, the payment is applied to all of them proportionately. Which of your invoices is the most onerous is often arguable, which is one more reason to make the designation yourself.

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.

Related provisions

Note. Statute text quoted on this page is reproduced from the official enactment and is linked to the full provision. The explanation around it is general legal information from Vivas & Nobles Law Office, not legal advice. Whether it applies to your situation depends on facts only a lawyer reviewing them can assess.