Text of the provision
Art. 1959. Without prejudice to the provisions of article 2212, interest due and unpaid shall not earn interest. However, the contracting parties may by stipulation capitalize the interest due and unpaid, which as added principal, shall earn new interest.
(n)
Civil Code of the Philippines, Republic Act No. 386, approved June 18, 1949, effective August 30, 1950. Reproduced in full; verified verbatim against the LawPhil and ChanRobles official-text renderings.
What this article means
Without prejudice to Art. 2212, unpaid interest does not itself earn interest — but the parties may stipulate to capitalize accrued interest as added principal that then earns new interest.
Related provisions
- Article 1958 — Interest Payable in Kind.
- Article 1960 — Payment of Interest Not Stipulated.
Cases citing this article
- Lara's Gifts & Decors, Inc. vs. Midtown Industrial Sales, Inc, G.R. No. 225433, September 20, 2022 — read the decision on LawPhil →
- Antonio Tan vs. Court of Appeals, et al, G.R. No. 116285, October 19, 2001 — read the decision on LawPhil →
- Metro Alliance Holdings and Equities Corporation, Polymax Worldwide Limited and Wellex Industries, Inc., G.R. No. 240495 / G.R. No. 240513, September 15, 2021 — read the decision on LawPhil →
- Erma Industries, Inc. vs. Security Bank Corporation and Sergio Ortiz-Luis, Jr. Oca No. IPI 15-4429-P December 6, 2017 Isagani R. Rubio vs. Igmedio J. Basada, Court Legal Researcher Ii, Branch 117, Regional Trial Court , Pasay City, G.R. No. 191274, December 6, 2017 — read the decision on LawPhil →
- Land Bank of the Philippines vs. Emmanuel C. Oñate, G.R. No. 192371, January 15, 2014 — read the decision on LawPhil →
Compiled automatically from Supreme Court decisions published on LawPhil that expressly cite this article, most frequently cited first. A listing means the decision cites the provision — it is not a statement that the case is the leading authority, and it does not show whether a ruling has since been modified or abandoned. Always read the decision itself.