REPUBLIC v.

BAGTAS, 116 SCRA 262 FACTS: On May 8, 1948, Jose Bagtas borrowed from the Bureau of Animal Industry three bulls for one year for breeding purposes upon payment of a breeding fee of 10% of the book value of the bulls. After one year, the contract was renewed but only for one bull.Bagtas offered to buy the bulls at book value less depreciation, but the Bureau told him that he should either return the bulls or pay for their book value. Bagtas failed to pay the book value, so the Republic filed an action with the CFI Manila to order the return of the bulls or the payment of the book value. FelicidadBagtas, the surviving spouse and administratrix of the decedents estate, said that the two bulls have already been returned in 1952, and that the remaining one died of gunshot during a Huk raid. It was established that the two bulls were returned, thus, there is no more obligation on the part of Bagtas. With regards the bull not returned, Felicidadmaintained that the obligation is extinguished since the contract is that of a commodatum and that the loss through fortuitous event should be borne by the owner. ISSUE: Whether or not the contract entered into between Bagtas and the Republic is that of commodatum making Bagtas not liable for the death of the bull. HELD: A contract of commodatum is essentially gratuitous. If the breeding fee be considered a compensation, then the contract would be a lease of the bull. Under article 1671 of the Civil Code the lessee would be subject to the responsibilities of a possessor in bad faith because she had continued possession of the bull after the expiry of the contract. Even if the contract be commodatum, still Bagtas is liable because article 1942 of the Civil Code provides that a bailee in a contract of commodatum is liable for loss of the things even if it should be through a fortuitous event if he keeps it longer than the period stipulated or if the thing loaned has been delivered with appraisal of its value, unless there is a stipulation exempting the bailee from responsibility in case of a fortuitous event. The loan of one bull was renewed for another period of one year but Bagtaskept and used the bull more than one year where during a Huk raid it was killed by stray bullets. Furthermore, when lent and delivered to the deceased husband of Bagtas, the bulls had each an appraised book value. It was not stipulated that in case of loss of the bull due to fortuitous event the late husband of the appellant would be exempt from liability.