Dear Attorney,
I have concerns about a financing company that required me to deposit various amounts of money before granting my loan. I initially deposited an agreed percentage, but after this, they requested additional payments for various reasons. In total, I’ve paid several large amounts, but they still haven’t released the loan, and now they’re asking for more. They didn’t explain these payments upfront aside from the first deposit. What legal action can I take against them?
Sincerely,
Concerned Borrower
Insights
In situations involving financial transactions, especially with financing companies, it is essential to be aware of the legal principles surrounding fraud and unjust enrichment. These concepts protect individuals from deceptive schemes or practices that unjustly benefit one party at the expense of another.
In this case, the financing company’s repeated requests for additional payments, without fulfilling their promise to release the loan, could potentially fall under fraudulent misrepresentation. Fraud occurs when one party intentionally deceives another to gain a financial advantage. In the Philippines, fraud is addressed under the Revised Penal Code, where any deceitful conduct aimed at obtaining property or money from another party may lead to criminal liability.
Moreover, the company’s failure to disclose all necessary payments upfront could also be a violation of contract law. Contracts require clear and mutual agreement on essential terms, including fees and obligations. Failure to disclose these terms may constitute bad faith in contract execution, leading to potential remedies such as rescission or damages.
Additionally, the situation touches upon unjust enrichment, where one party benefits at the expense of another without just cause. Under the Civil Code of the Philippines, those who unjustly benefit from another’s property or money may be required to return what they have acquired.
Victims of fraudulent schemes can file a case before the National Bureau of Investigation (NBI) or the Philippine National Police (PNP) for investigation and possible criminal charges. For civil remedies, they may also pursue a case for damages under Article 19-21 of the Civil Code, which mandates that parties act in good faith in transactions and avoid causing harm to others.
Finally, for amounts involved within the small claims court jurisdiction, individuals may file for the recovery of money without the need for legal representation. This process is expedited and ensures the return of the amounts unlawfully demanded.
In all cases, it is advisable to seek legal counsel to assess the specifics and determine the best course of action.