Practice question
A demand letter quotes supposed conventional loan interest despite no written interest stipulation. What drafting distinction is essential?
- Do not invent stipulated interest; distinguish it from any legally recoverable damages interest.
- Any letter creates a binding written interest agreement.
- Counsel may choose any conventional rate retroactively.
- The creditor’s oral instruction is the debtor’s written stipulation.
- All forms of legal interest are categorically impossible.
Legal references
- Civil Code, Articles1244,1246,1248,1251,1956: https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/2/53360
- Civil Code Article2209, interest as damages distinct from stipulated conventional interest: https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/2/53360
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