Q.

To secure the payment of his obligation, A pledged to his surety C, his car who sold the car after paying the obligation of A. The obligation was P2M but the car was sold for only P1M. Can the surety recover the deficiency?

A. Yes, otherwise, there would be solution indebiti;
B. Yes, no law prohibits him from doing so as he is not the direct creditor;
C. No. In the foreclosure of a pledge, if the price of the sale is less than the indebtedness secured by the pledge, the creditor shall not be entitled to recover the deficiency, notwithstanding any stipulation to the contrary.
D. Yes, if there is a stipulation.
Answer» C. No. In the foreclosure of a pledge, if the price of the sale is less than the indebtedness secured by the pledge, the creditor shall not be entitled to recover the deficiency, notwithstanding any stipulation to the contrary.
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