Short answer. The most burdensome one. Article 1254 says that when payment cannot be applied under the other rules, the debt most onerous to the debtor among those due is deemed satisfied. If the debts are of the same nature and burden, the payment is applied to all of them proportionately.
What the law says
the debt which is most onerous to the debtor, among those due, shall be deemed to have been satisfied
Civil Code, Article 1254 — Application by Operation of Law. Read the full provision →
When neither side chose, the law chooses
Ordinarily a debtor names which debt his payment covers, or the creditor does so in a receipt the debtor accepts. Article 1254 is the fallback for when neither happened. It provides that When the payment cannot be applied in accordance with the preceding rules, or if application can not be inferred from other circumstances, the law itself decides. Because you said nothing and the receipt was silent, this default kicks in. The Code does not leave the question hanging; it supplies a rule so that your payment is credited to a definite debt rather than floating unassigned among the several you owe.
The most onerous debt is deemed paid
The default favors you, the debtor. The article says the debt which is most onerous to the debtor, among those due, shall be deemed to have been satisfied. Among the debts that are already due, the law applies your payment to the one that weighs most heavily on you. A debt bearing interest is generally more burdensome than one without; a secured or guaranteed debt, or one carrying a penalty, is typically heavier than a plain one. By deeming the most onerous due debt paid first, the Code relieves you of the obligation that costs you the most, which is the sensible presumption of what a debtor would have wanted.
When the debts are equally burdensome
The article covers the tie. It continues: If the debts due are of the same nature and burden, the payment shall be applied to all of them proportionately. So if none of the due debts is heavier than the others — they are alike in kind and weight — the law does not arbitrarily pick one. It spreads your payment across all of them in proportion to their amounts. Each debt is partially reduced rather than one being singled out. This keeps the outcome even-handed where there is no basis to prefer discharging any single obligation over the rest.
The limits of this rule
Article 1254 only operates among those due — debts not yet demandable are generally left out of this automatic application. It is also a last resort: it applies only after the earlier rules fail, so if you had validly directed the payment, or accepted a receipt that applied it, that choice controls instead and this default never reaches. The rule assigns which debt your payment satisfies; it does not change the amounts owed or create new obligations. Understanding it matters, because staying silent hands the decision to the law — which here happens to lift your heaviest due debt first.
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.
- Premiere Development Bank vs. Spouses Engracio T. Castañeda, G.R. No. 185110, August 19, 2024 — read the decision on LawPhil →
- Estanislao and Africa Sinamban vs China Banking Corporation, G.R. No. 193890, March 11, 2015 — read the decision on LawPhil →
- New Sampaguita Builders Construction, Inc., et al. vs. Philippine National Bank, G.R. No. 148753, July 30, 2004 — read the decision on LawPhil →