I. Introduction

In the Philippines, disputes between schools and students (or their parents) over unpaid tuition and fees often crystallize around one painful issue: withholding of school documents—report cards, Form 137, Form 138, certificates of graduation, diplomas, transcripts of records (TOR), and transfer credentials.

This practice sits at the intersection of two competing interests:

The right to education and the learner’s interest in freely accessing credentials needed to continue studies or work; and
The school’s right to collect what is contractually due, especially in private education where tuition is the lifeblood of operations.

This article surveys the legal and policy landscape on withholding school documents for unpaid fees in the Philippine context, distinguishing between:

Public vs private institutions
Basic education (K–12) vs higher education vs tech-voc
Types of documents being withheld

It ends with practical guidance for both schools and learners.

II. Legal Framework

A. Constitutional Right to Education

The 1987 Constitution declares that:

The State shall protect and promote the right of all citizens to quality education at all levels and shall take appropriate steps to make such education accessible to all (Art. XIV, Sec. 1).
The State recognizes the complementary roles of public and private educational institutions and exercises reasonable supervision and regulation over them.

From this arise two key ideas:

Access to education must not be unreasonably obstructed, particularly in basic education.
Private schools, while protected by academic freedom and contractual autonomy, remain subject to State regulation in the interest of students.

B. Statutory Regulation of Schools

Several statutes frame how schools operate and are regulated:

Education Act of 1982 (Batas Pambansa Blg. 232) – Provides rights and duties of students, and recognizes the regulatory power of the State over both public and private schools.
RA 9155 (Governance of Basic Education Act) – Vests DepEd with authority over basic education.
RA 7722 (Higher Education Act) – Creates CHED, which supervises higher education institutions (HEIs).
RA 7796 (TESDA Act) – Governs technical-vocational education and training.

These laws authorize DepEd, CHED, and TESDA to issue orders, circulars, and manuals regulating how schools deal with student records and financial obligations.

C. Contracts in Private Education

Enrollment in a private school is typically treated as a contract of enrollment:

The school is obliged to provide education and confer credentials upon completion.
The student (or parents) are obliged to pay tuition and other authorized fees.

In principle, the school may invoke contractual remedies (refusal to re-enroll, civil suits, etc.) where the student defaults. But these remedies are tempered by regulation: education is a special, heavily regulated field where purely private contractual logic does not always prevail.

III. Public Basic Education (DepEd Public Schools)

A. No Tuition / No Mandatory Fees

In public elementary and secondary schools:

Tuition is free.
Schools are prohibited from imposing compulsory contributions as a condition for admission, release of cards, or graduation.

Any collection (for school projects, organizations, etc.) must be voluntary and never a ground to withhold documents.

B. Prohibition on Withholding School Records

DepEd has long maintained as policy that:

Public schools may not withhold report cards, Form 137, or other academic records due to non-payment of authorized voluntary contributions or any other financial matter.
A learner’s transfer credentials must be issued when needed to enroll in another school.

For public schools, therefore:

Withholding of documents for unpaid fees is generally not allowed, because there should be no tuition or compulsory collections to begin with.
If a parent refuses to pay voluntary contributions, the school’s recourse is administrative (report to DepEd) or simply non-collection, not penalizing the child.

C. Practical Implications

In practice:

A public school cannot refuse to release a learner’s Form 138 (report card) or Form 137 (permanent record) because a “contribution” for projects, PTA, graduation, or similar has not been given.
If a school head conditions release of records on payment of such amounts, this may be questioned before the Schools Division Office or DepEd Regional Office.

IV. Private Basic Education (Private Elementary / High Schools under DepEd)

Private basic education operates under DepEd recognition and regulation but is funded primarily by tuition. The law attempts to balance:

The school’s right to collect what is due; and
The learner’s right to continue schooling and access credentials.

A. Payment Obligations

As a rule:

Parents/students must pay tuition and other authorized fees as agreed in the enrollment contract or school handbook.
Schools may impose consequences for non-payment, but these consequences are regulated, especially when they directly impact the learner’s ability to continue education.

B. DepEd Policy on Withholding Records

DepEd policy (through orders and memoranda over the years) generally provides that:

Basic education schools (public and private) should not withhold Form 137, Form 138, or transfer credentials on account of unpaid authorized school obligations.
Schools may pursue collection through normal civil remedies but should not use student records as leverage where such leverage would effectively bar the child from continuing his/her education.

The rationale is clear: in basic education, the child’s right to education is paramount. The State discourages practices that block a child’s transfer or continuation in another school simply because parents cannot (or will not) pay.

C. What Schools Can Do

Typically accepted measures for private basic schools include:

Refusing re-enrollment of a student with unpaid tuition in the same school for the next school year.
Demanding payment through collection letters, negotiations, or, ultimately, civil cases (e.g., small claims).
Charging reasonable processing or certification fees for records, so long as such fees are not punitive or grossly disproportionate.

But the line is crossed when:

The school uses withholding of essential records as a way to block transfer (e.g., refusing to issue Form 137 to the receiving school) solely due to unpaid accounts.

A common compromise in practice:

The receiving school may condition its own final enrollment on a certification that prior obligations are settled, while DepEd expects the sending school to coordinate on transfer of essential records without unduly delaying the learner’s admission.

D. Graduation vs Credentials

Some private schools:

Allow the student to join graduation rites even with unpaid balances (often as an act of compassion or policy), but may withhold the diploma pending settlement.
DepEd tends to emphasize that denying participation in rites or withholding certifications that the learner has completed the curriculum may be unreasonable if academic requirements are fulfilled.

However, specific practices vary, and DepEd intervention is often case-by-case.

V. Higher Education Institutions (Colleges / Universities under CHED)

A. Greater Contractual Autonomy

In higher education:

Students are legally adults or near-adults.
HEIs enjoy broader institutional and academic freedom.
Tuition and fees are fully contractual, except for State universities and colleges (SUCs) benefitting from “free tuition” schemes.

As a result, HEIs commonly withhold certain documents (especially the TOR and diploma) until financial obligations are settled.

B. Common Practice and Regulatory Stance

Typical practices among private HEIs:

The school will not release TOR, diploma, or certificates of graduation if the student has unpaid tuition or other financial obligations.
The student may have:
- Finished all academic requirements,
- Even joined graduation ceremonies,
- But still cannot obtain TOR or official diploma until cleared.

Regulators (CHED) have historically:

Discouraged abusive practices, e.g., “no permit, no exam” policies that effectively bar a student from taking exams despite partial payment and willingness to settle.
Often encouraged flexible payment schemes, especially in times of crisis.

However, CHED has generally not prohibited HEIs from withholding TOR and diplomas as a way to enforce contractual rights, so long as:

The policies are public (in the student handbook or contract), and
The school complies with due process and applicable CHED issuances.

C. Distinguishing Essential Records

There is often a practical distinction between:

Internal or short-term academic documents (e.g., grade slips, semester-class cards, certification of grades needed for board exam) – where regulators expect schools to be more lenient.
Terminal credentials (TOR and diploma) – where schools commonly impose the “no clearance, no release” rule.

For example:

A school might issue a certification of graduation or completion of degree requirements necessary for the student to take a licensure exam, even if there is a balance, especially when required by PRC rules—but still hold the TOR and diploma until obligations are settled.

D. Public HEIs and SUCs

For SUCs and LUCs:

Tuition may be covered by government “free tuition” laws, but other fees (miscellaneous, fines, etc.) may still be owed.
Policies on withholding documents often mirror those of private HEIs, but must comply with their charters and CHED guidelines.

VI. Technical-Vocational Institutions (TESDA)

In TESDA-accredited institutions:

Students often require Certificates of Competency (COC) or National Certificates (NC) to work locally or abroad.
The assessment and certification process is under TESDA; schools are primarily training providers.

Common arrangements:

The school may withhold internal documents (e.g., training certificates, internal grades) for unpaid fees.
However, once the student qualifies for a TESDA-issued certificate, the concern is whether non-payment to the school can or should block issuance:
- As a rule, TESDA’s own issuance of NC/COC is independent of the school’s collection practices, but the student may need the school’s endorsement or documentation to qualify for assessment.
- If a school refuses to release required endorsements solely due to non-payment, TESDA may intervene on policy grounds, particularly if this unnecessarily impairs employability.

VII. Types of School Documents and How Withholding is Treated

It is useful to discuss specific documents:

A. Report Cards (Form 138)

Used for promotion and periodic monitoring of the learner’s progress.
In basic education (public and private), DepEd policy disfavors using report cards as leverage for unpaid fees, because:
- The learner needs the card to enroll in the next level or section, and
- Withholding can effectively block continuation of education.

In higher education, grade slips and similar documents are more flexible, but schools are still encouraged not to unduly withhold them once academic requirements are fulfilled.

B. Permanent Records (Form 137 / Learner’s Permanent Record)

Critical for transfer to another school and long-term academic history.
DepEd policy is particularly strict that permanent records should not be withheld, as this impairs the learner’s right to transfer.

A common arrangement:

The sending school transmits Form 137 directly to the receiving school, minimizing the risk that parents manipulate the record; and DepEd expects this to happen regardless of unpaid financial obligations.

C. Transfer Credentials / Honorable Dismissal

For basic ed: letters of transfer, certificates of eligibility to enroll.
For higher ed: Honorable Dismissal or Transfer Credentials.

In basic ed, these should normally be issued when a learner wishes to transfer, regardless of unpaid account, with the school free to pursue collection separately.

In higher ed:

Schools may withhold Honorable Dismissal and TOR until accounts are settled, as part of contractual enforcement, unless a specific law or CHED directive applies in particular circumstances (e.g., humanitarian grounds, government scholarship conditions).

D. Transcript of Records (TOR)

The single most important document for higher education mobility and employment.
In practice, HEIs often condition release of TOR on full settlement of accounts.
While criticized as harsh, this practice:
- Is grounded in the school’s retention of records as leverage;
- Has not been categorically outlawed by statute or general regulation (as of the usual understanding).

However, arguments against abusive withholding include:

The risk that such practices amount to unreasonable restraint of a person’s right to work and study, especially when balances are minor or disputed.
Equity considerations: once the school has already received value (the student’s attendance, government subsidies, etc.), indefinite withholding of TOR may be challenged as unconscionable, particularly if the student offers reasonable payment arrangements.

E. Diplomas / Certificates of Graduation

Diplomas are primarily symbolic, acknowledging completion of a program.
Schools may:
- Allow a student to join the ceremony but withhold the physical diploma until clearance; or
- Deny the right to march if balances remain, per school policy.

From a regulatory perspective:

There is no clear nationwide ban on withholding diplomas in higher education due to unpaid fees, but DepEd discourages such practice in basic ed where the child’s welfare is paramount.

F. Certifications Needed for Licensure Exams / Employment

Examples:

Certification of completed units needed to take a PRC exam.
Certification of good moral character or enrollment status for employment or immigration.

Regulators often nudge schools to:

Release minimum necessary certifications to avoid blocking a licensure exam or job opportunity, especially if the student is academically qualified.
At the same time, schools may still assert the right to keep TOR and diploma until final settlement.

VIII. “No Permit, No Exam” and Related Policies

A related but distinct issue:

Some schools implement “no permit, no exam” policies, denying students the right to take midterms or finals unless a certain percentage of fees is paid.

Regulatory and policy responses have generally:

Discouraged harsh application of such policies, especially in basic education and in times of crisis.
Encouraged schools to allow exams and pursue collection through other means, or to allow exams subject to a promissory note.

While not always strictly illegal in higher education (where contracts are more freely made), such policies can be subject to:

Administrative oversight (CHED/DepEd intervention if unreasonable).
Public pressure, as they may be seen as contrary to the spirit of the right to education.

IX. Human Rights and Child Protection Dimensions

Particularly in basic education:

Public humiliation of children for unpaid fees (e.g., announcing balances in class, making them sit out graduation) can be seen as:
- A form of psychological abuse under child protection frameworks;
- A violation of DepEd’s Child Protection Policy, which prohibits acts that degrade a child’s dignity.

Even without explicit laws on “withholding documents,” the manner in which schools communicate and enforce financial policies may fall under:

Child protection rules (for minors).
Anti-bullying and anti-violence laws.
Human rights standards, if access to schooling is substantially obstructed.

X. Remedies for Students and Parents

When a school withholds documents for unpaid fees, possible remedies include:

A. Administrative Complaints

DepEd – For basic education (public and private).
- File a complaint with the Schools Division Office or Regional Office.
- DepEd can issue directives to schools, especially on release of basic education records.
CHED – For HEIs.
- Students may raise concerns about unreasonable or abusive policies on document withholding or “no permit, no exam,” particularly if they contradict CHED Memorandum Orders.
TESDA – For tech-voc training institutions.
- Complaints can be raised where a school’s refusal to release endorsements or internal certificates is blocking TESDA certification or employment.

B. Civil Remedies

Students or parents may:

Bring actions in regular courts for:
- Specific performance (e.g., to compel release of documents where legally obliged);
- Damages, if wrongful withholding caused harm (e.g., lost job opportunity, inability to enroll elsewhere).

Conversely, schools may:

File collection suits for unpaid fees (including small claims), which is the proper legal avenue, rather than punitive withholding of essential basic education records.

C. Mediation and Negotiation

Often, disputes are best resolved through:

Promissory notes and reasonable payment plans.
Partial release of essential certifications (e.g., for board exams) while keeping some documents (like TOR) until full settlement.
Involvement of PTAs, guidance offices, or local government units to support families facing financial difficulty.

XI. Practical Guidelines

A. For Schools

Distinguish by level and document
- Basic education: Avoid withholding Form 137, Form 138, and transfer records, even if there are unpaid balances.
- Higher education: If you withhold TOR/diploma, ensure it is clearly grounded in policy, publicly known, and not applied abusively.
Document your policies
- Put rules about financial obligations and document release clearly in the student handbook and enrollment contracts.
- Ensure consistency with DepEd/CHED/TESDA issuances.
Avoid practices harmful to children
- Never publicly shame or humiliate students for unpaid fees.
- Avoid denying basic learning activities (classes, tests) to children in basic education.
Use lawful collection remedies
- Resort to civil collection actions rather than using essential basic education records as leverage.
- Consider amicable settlement mechanisms before litigation.

B. For Students and Parents

Read the school handbook and contracts
- Understand policies on tuition, deadlines, and consequences of non-payment.
Communicate early
- If you anticipate difficulty paying, talk to the school early; many schools allow staggered payments or promissory notes.
Know when withholding is questionable
- In public and private basic education, withholding Form 137, Form 138, or transfer credentials simply because of unpaid fees can usually be challenged.
- In higher education, withholding TOR or diploma is more commonly upheld, but you may still contest unreasonable or abusive applications.
Use administrative channels
- If negotiations fail, consider complaints with DepEd/CHED/TESDA, depending on the level.
- Keep copies of enrolment forms, receipts, and written policies; these are crucial in any complaint.
Seek legal assistance when needed
- Complex or high-stakes cases (e.g., large balances, serious damages from lost opportunities) may require consultation with a Philippine lawyer to assess whether the school’s actions are legally defensible.

XII. Conclusion

In the Philippine legal framework, withholding school documents for unpaid fees is not governed by a single all-encompassing statute, but by a mosaic of constitutional principles, statutes, and administrative regulations.

Broadly:

In basic education, especially in public schools, withholding essential records such as Form 137, Form 138, and transfer credentials for non-payment is strongly disfavored or prohibited, because it interferes with the child’s right to continue schooling.
In higher education, schools have greater contractual leeway to withhold TOR and diplomas for unpaid tuition, although regulators and principles of fairness can curb abusive or unreasonable applications of this practice.

Ultimately, the law seeks a balance: respecting the school’s right to be paid while ensuring that the learner’s right to education—and, in the case of minors, their dignity and welfare—remains at the center of policy and practice.

If you’d like, I can next help you apply these principles to a specific scenario (e.g., a private high school refusing to release records, or a university withholding a TOR) and outline concrete steps, letters, or arguments tailored to that case.