Query: Papaano po ba pag ayaw na magpakita ng nangutang? verbal agreement lang po walang written contract. 3 months na po due ang utang?

In the Philippines, the obligation to repay a debt does not necessarily require a written contract. Verbal agreements can be binding and enforceable, although they may pose more challenges in proving the existence and terms of the agreement. Here are the legal remedies available to a creditor when the debtor refuses to pay and only a verbal agreement exists:

1. Demand Letter

Before pursuing legal action, the creditor should first send a formal demand letter to the debtor. This letter should outline the amount owed, the terms of the verbal agreement, and a request for payment by a specified date. This step is essential to show that the creditor has made efforts to settle the matter amicably.

2. Small Claims Court

For debts not exceeding PHP 1,000,000, the creditor can file a case in the Small Claims Court. This court is designed to provide a quicker resolution for monetary claims without the need for lawyers. The creditor must present evidence of the debt, which can include:

Text messages or emails acknowledging the debt.
Witness testimonies from individuals who were present during the agreement.
Any partial payments made by the debtor, which indicate acknowledgment of the debt.

3. Barangay Conciliation

Under the Katarungang Pambarangay Law (Presidential Decree No. 1508), disputes involving small sums can be settled at the barangay level. The creditor can file a complaint with the Barangay Chairman, who will then call for a conciliation meeting between the parties. If an amicable settlement is reached, it will be put into writing and signed by both parties. This agreement can be enforced like any other court judgment.

4. Civil Case for Collection of Sum of Money

If the amount exceeds PHP 1,000,000 or if the Small Claims Court or Barangay Conciliation fails, the creditor can file a civil case in the regular courts. In this case, the creditor must provide evidence to support the claim, similar to the requirements in Small Claims Court but potentially involving more formal procedures.

5. Proving a Verbal Agreement

In the absence of a written contract, the burden of proof lies with the creditor. Here are some ways to prove a verbal agreement:

Testimonies: Witnesses who heard the agreement or can attest to its existence and terms.
Partial Performance: Any actions taken by either party that demonstrate the agreement's existence, such as partial payments.
Consistent Behavior: Patterns of behavior that align with the terms of the verbal agreement.

6. Prescriptive Period

It is essential to be aware of the prescriptive period for filing a collection case. Under Philippine law, actions upon an oral contract prescribe in six years from the time the right of action accrues. This means the creditor has six years to file a lawsuit from the date the debt became due.

7. Legal Assistance

While it is possible to pursue these remedies without a lawyer, legal assistance can be beneficial, especially in preparing documents, understanding legal procedures, and increasing the chances of a favorable outcome.

In conclusion, even without a written contract, a creditor has several legal remedies to enforce a debt repayment. Taking timely and appropriate steps, such as sending a demand letter, utilizing Small Claims Court, or seeking barangay conciliation, can help in recovering the owed amount.