1. CORONEL v.

CA
The Civil Code defines a contract of sale, thus:
Art. 1458. By the contract of sale one of the contracting
parties obligates himself to transfer the ownership of and
to deliver a determinate thing, and the other to pay
therefor a price certain in money or its equivalent.
Sale, by its very nature, is a consensual contract
because it is perfected by mere consent. The essential
elements of a contract of sale are the following:
a) Consent or meeting of the minds, that is, consent to
transfer ownership in exchange for the price;
b) Determinate subject matter; and

promissor if the promise is supported by a consideration

distinct from the price.
A contract to sell may thus be defined as a bilateral
contract whereby the prospective seller, while expressly
reserving the ownership of the subject property despite
delivery thereof to the prospective buyer, binds himself
to sell the said property exclusively to the prospective
buyer upon fulfillment of the condition agreed upon, that
is, full payment of the purchase price.
In a contract to sell, upon the fulfillment of the
suspensive condition which is the full payment of the
purchase price, ownership will not automatically transfer
to the buyer although the property may have been
previously delivered to him. The prospective seller still
has to convey title to the prospective buyer by entering
into a contract of absolute sale.

c) Price certain in money or its equivalent.

Under this definition, a Contract to Sell may not be
considered as a Contract of Sale because the first
essential element is lacking. In a contract to sell, the
prospective seller explicity reserves the transfer of title to
the prospective buyer, meaning, the prospective seller
does not as yet agree or consent to transfer ownership
of the property subject of the contract to sell until the
happening of an event, which for present purposes we
shall take as the full payment of the purchase price.
In other words the full payment of the purchase price
partakes of a suspensive condition, the non-fulfillment of
which prevents the obligation to sell from arising and
thus, ownership is retained by the prospective seller
without further remedies by the prospective buyer.
upon the fulfillment of the suspensive condition which is
the full payment of the purchase price, the prospective
seller's obligation to sell the subject property by entering
into a contract of sale with the prospective buyer
becomes demandable as provided in Article 1479 of the
Civil Code which states:
Art. 1479. A promise to buy and sell a determinate thing
for a price certain is reciprocally demandable.
An accepted unilateral promise to buy or to sell a
determinate thing for a price certain is binding upon the

In a contract to sell, there being no previous sale of the

property, a third person buying such property despite the
fulfillment of the suspensive condition such as the full
payment of the purchase price, for instance, cannot be
deemed a buyer in bad faith and the prospective buyer
cannot seek the relief of reconveyance of the property.
There is no double sale in such case. Title to the
property will transfer to the buyer after registration
because there is no defect in the owner-seller's title per
se, but the latter, of course, may be used for damages
by the intending buyer.
In a conditional contract of sale, however, upon the
fulfillment of the suspensive condition, the sale becomes
absolute and this will definitely affect the seller's title
thereto. In fact, if there had been previous delivery of the
subject property, the seller's ownership or title to the
property is automatically transferred to the buyer such
that, the seller will no longer have any title to transfer to
any third person.
DOUBLE SALE presumes title or ownership to pass to
the first buyer, the exceptions being: (a) when the
second buyer, in good faith, registers the sale ahead of
the first buyer, and (b) should there be no inscription by
either of the two buyers, when the second buyer, in good
faith, acquires possession of the property ahead of the
first buyer. Unless, the second buyer satisfies these

requirements, title or ownership will not transfer to him to

the prejudice of the first buyer.
If a vendee in a double sale registers that sale after he
has acquired knowledge that there was a previous sale
of the same property to a third party or that another
person claims said property in a pervious sale, the
registration will constitute a registration in bad faith and
will not confer upon him any right.
2. ROMERO v. CA
A perfected contract of sale may either be absolute or
conditional depending on whether the agreement is
devoid of, or subject to, any condition imposed on the
passing of title of the thing to be conveyed or on the
obligation of a party thereto. When ownership is retained
until the fulfillment of a positive condition the breach of
the condition will simply prevent the duty to convey title
from acquiring an obligatory force. If the condition is
imposed on an obligation of a party which is not
complied with, the other party may either refuse to
proceed or waive said condition (Art. 1545, Civil Code).
Where, of course, the condition is imposed upon the
perfection of the contract itself, the failure of such
condition would prevent the juridical relation itself from
coming into existence.
In determining the real character of the contract, the title
given to it by the parties is not as much significant as its
substance.
The term "condition" in the context of a perfected
contract of sale pertains, in reality, to the compliance by
one party of an undertaking the fulfillment of which would
beckon, in turn, the demandability of the reciprocal
prestation of the other party. The reciprocal obligations
referred to would normally be, in the case of vendee, the
payment of the agreed purchase price and, in the case
of the vendor, the fulfillment of certain express
warranties (which, in the case at bench is the timely
eviction of the squatters on the property).
A sale is at once perfected when a person (the seller)
obligates himself, for a price certain, to deliver and to
transfer ownership of a specified thing or right to another
(the buyer) over which the latter agrees.
In contracts of sale particularly, Article 1545 of the Civil
Code, aforementioned, allows the obligee to choose

between proceeding with the agreement or waiving the

performance of the condition.
3. FULE v. CA
The Civil Code provides that contracts are perfected by
mere consent.
A contract of sale is perfected at the moment there is a
meeting of the minds upon the thing which is the object
of the contract and upon the price. Being consensual, a
contract of sale has the force of law between the
contracting parties and they are expected to abide in
good faith by their respective contractual commitments.
Article 1358 of the Civil Code which requires the
embodiment of certain contracts in a public instrument,
is only for convenience, and registration of the
instrument only adversely affects third parties.
Contracts that are voidable or annullable, even though
there may have been no damage to the contracting
parties are: (1) those where one of the parties is
incapable of giving consent to a contract; and (2) those
where the consent is vitiated by mistake, violence,
intimidation, undue influence or fraud.
To invalidate a contract, mistake must "refer to the
substance of the thing that is the object of the contract,
or to those conditions which have principally moved one
or both parties to enter into the contract."
Article 1589 of the Civil Code prescribes the payment of
interest by the vendee "for the period between the
delivery of the thing and the payment of the price" in the
following cases:
(1) Should it have been so stipulated;
(2) Should the thing sold and delivered produce fruits or
income;
(3) Should he be in default, from the time of judicial or
extrajudicial demand for the payment of the price.
4. ONG v. CA
In a contract of sale, the title to the property passes to
the vendee upon the delivery of the thing sold; while in a
contract to sell, ownership is, by agreement, reserved in
the vendor and is not to pass to the vendee until full

payment of the purchase price. 18 In a contract to sell,

the payment of the purchase price is a positive
suspensive condition, the failure of which is not a
breach, casual or serious, but a situation that prevents
the obligation of the vendor to convey title from acquiring
an obligatory force.
5. GAITE v. FONACIER
A contract of sale is normally commutative and onerous:
not only does each one of the parties assume a
correlative obligation (the seller to deliver and transfer
ownership of the thing sold and the buyer to pay the
price),but each party anticipates performance by the
other from the very start.
6. ACAP v. CA
In a Contract of Sale, one of the contracting parties
obligates himself to transfer the ownership of and to
deliver a determinate thing, and the other party to pay a
price certain in money or its equivalent.
7. QUIJADA v. CA
Sale, being a consensual contract, is perfected by mere
consent, which is manifested the moment there is a
meeting of the minds 17 as to the offer and acceptance
thereof on three (3) elements: subject matter, price and
terms of payment of the price. 18 Ownership by the seller
on the thing sold at the time of the perfection of the
contract of sale is not an element for its perfection.
A perfected contract of sale cannot be challenged on the
ground of non-ownership on the part of the seller at the
time of its perfection; hence, the sale is still valid.
8. CELESTINO & CO. v. CIR
Appellant invokes Article 1467 of the New Civil Code to
bolster its contention that in filing orders for windows and
doors according to specifications, it did not sell, but
merely contracted for particular pieces of work or
"merely sold its services".
A contract for the delivery at a certain price of an article
which the vendor in the ordinary course of his business
manufactures or procures for the general market,
whether the same is on hand at the time or not, is a
contract of sale, but if the goods are to be manufactured
specially for the customer and upon his special order,

and not for the general market, it is contract for a piece

of work.
Such new form does not divest the Oriental Sash
Factory of its character as manufacturer. Neither does it
take the transaction out of the category of sales under
Article 1467 above quoted, because although the
Factory does not, in the ordinary course of its business,
manufacture and keep on stock doors of the kind sold to
Teodoro, it could stock and/or probably had in stock the
sash, mouldings and panels it used therefor (some of
them at least).

9. CIR v. ENGINEERING EQUIPMENT

Manufacturer" includes every person who by physical or
chemical process alters the exterior texture or form or
inner substance of any raw material or manufactured or
partially manufactured products in such manner as to
prepare it for a special use or uses to which it could not
have been put in its original condition, or who by any
such process alters the quality of any such material or
manufactured or partially manufactured product so as to
reduce it to marketable shape, or prepare it for any of
the uses of industry, or who by any such process
combines any such raw material or manufactured or
partially manufactured products with other materials or
products of the same or of different kinds and in such
manner that the finished product of such process of
manufacture can be put to special use or uses to which
such raw material or manufactured or partially
manufactured products in their original condition could
not have been put, and who in addition alters such raw
material or manufactured or partially manufactured
products, or combines the same to produce such
finished products for the purpose of their sale or
distribution to others and not for his own use or
consumption.
Our New Civil Code, likewise distinguishes a contract of
sale from a contract for a piece of work thus:
Art. 1467. A contract for the delivery at a certain price of
an article which the vendor in the ordinary course of his
business manufactures or procures for the general
market, whether the same is on hand at the time or not,
is a contract of sale, but if the goods are to be

manufactured specially for the customer and upon his

special order and not for the general market, it is a
contract for a piece of work.
The true test of a contractor as was held in the cases of
Luzon Stevedoring Co., vs. Trinidad, 43, Phil. 803, 807808, and La Carlota Sugar Central vs. Trinidad, 43, Phil.
816, 819, would seem to be that he renders service in
the course of an independent occupation, representing
the will of his employer only as to the result of his work,
and not as to the means by which it is accomplished.
10. ENGINEERING & MACHINERY CORP v. CA
Article 1713 of the Civil Code defines a contract for a
piece of work thus:
By the contract for a piece of work the contractor binds
himself to execute a piece of work for the employer, in
consideration of a certain price or compensation. The
contractor may either employ only his labor or skill, or
also furnish the material.
A contract for a piece of work, labor and materials may
be distinguished from a contract of sale by the inquiry as
to whether the thing transferred is one not in existence
and which would never have existed but for the order, of
the person desiring it . In such case, the contract is one
for a piece of work, not a sale. On the other hand, if the
thing subject of the contract would have existed and
been the subject of a sale to some other person even if
the order had not been given, then the contract is one of
sale.
The obligations of a contractor for a piece of work are
set forth in Articles 1714 and 1715 of the Civil Code,
which provide:
Art. 1714. If the contractor agrees to produce the work
from material furnished by him, he shall deliver the thing
produced to the employer and transfer dominion over the
thing. This contract shall be governed by the following
articles as well as by the pertinent provisions on
warranty of title and against hidden defects and the
payment of price in a contract of sale.
Art. 1715. The contractor shall execute the work in such
a manner that it has the qualities agreed upon and has
no defects which destroy or lessen its value or fitness for

its ordinary or stipulated use. Should the work be not of

such quality, the employer may require that the
contractor remove the defect or execute another work. If
the contractor fails or refuses to comply with this
obligation, the employer may have the defect removed
or another work executed, at the contractor's cost.
The provisions on warranty against hidden defects,
referred to in Art. 1714 above-quoted, are found in
Articles 1561 and 1566, which read as follows:
Art. 1561. The vendor shall be responsible for warranty
against the hidden defects which the thing sold may
have, should they render it unfit for the use for which it is
intended, or should they diminish its fitness for such use
to such an extent that, had the vendee been aware
thereof, he would not have acquired it or would have
given a lower price for it; but said vendor shall not be
answerable for patent defects or those which may be
visible, or for those which are not visible if the vendee is
an expert who, by reason of his trade or profession,
should have known them.
Art. 1566. The vendor is responsible to the vendee for
any hidden faults or defects in the thing sold, even
though he was not aware thereof.
This provision shall not apply if the contrary has been
stipulated, and the vendor was not aware of the hidden
faults or defects in the thing sold.
The remedy against violations of the warranty against
hidden defects is either to withdraw from the contract
(redhibitory action) or to demand a proportionate
reduction of the price (accion quanti manoris), with
damages in either case.
11. QUIROGA v. PARSONS
These features exclude the legal conception of an
agency or order to sell whereby the mandatory or agent
received the thing to sell it, and does not pay its price,
but delivers to the principal the price he obtains from the
sale of the thing to a third person, and if he does not
succeed in selling it, he returns it.
12. PUYAT v. ARCO AMUSEMENT CO.

It follows that the petitioner as vendor is not bound to

reimburse the respondent as vendee for any difference
between the cost price and the sales price which
represents the profit realized by the vendor out of the
transaction. This is the very essence of commerce
without which merchants or middleman would not exist.
13. MEDINA v. CIR
Article 1490 of the Civil Code has no application to the
sales made by said petitioner to his wife, because said
transactions are contemplated and allowed by the
provisions of Articles 7 and 10 of the Code of
Commerce. But said provisions merely state, under
certain conditions, a presumption that the wife is
authorized to engage in business and for the incidents
that flow therefrom when she so engages therein. But
the transactions permitted are those entered into with
strangers, and do not constitute exceptions to the
prohibitory provisions of Article 1490 against sales
between spouses.

These contracts are binding, unless they are annulled by

a proper action in court. They are susceptible of
ratification.
In the event that one spouse is incapacitated or
otherwise unable to participate in the administration of
the conjugal properties, the other spouse may assume
sole powers of administration. These powers do not
include the powers of disposition or encumbrance which
must have the authority of the court or the written
consent of the other spouse. In the absence of such
authority or consent, the disposition or encumbrance
shall be void.
Under Article 166 of the Civil Code, the husband cannot
generally alienate or encumber any real property of the
conjugal partnershit without the wife's consent. The
alienation or encumbrance if so made however is not
null and void. It is merely voidable. The offended wife
may bring an action to annul the said alienation or
encumbrance. Thus the provision of Article 173 of the
Civil Code of the Philippines, to wit:

14. CALIMLIM-CANULLA v. FORTUN

Article 1409 of the Civil Code states inter alia that:
contracts whose cause, object, or purpose is contrary to
law, morals, good customs, public order, or public policy
are void and inexistent from the very beginning.
Article 1352 also provides that: "Contracts without
cause, or with unlawful cause, produce no effect
whatsoever. The cause is unlawful if it is contrary to law,
morals, good customs, public order, or public policy."
15. GUIANG v. CA
The sale of a conjugal property requires the consent of
both the husband and the wife. The absence of the
consent of one renders the sale null and void, while the
vitiation thereof makes it merely voidable. Only in the
latter case can ratification cure the defect.
Art. 1390. The following contracts are voidable or
annullable, even though there may have been no
damage to the contracting parties:
(2) Those where the consent is vitiated by mistake,
violence, intimidation, undue influence or fraud.

Art. 173. The wife may, during the marriage and within
ten years from the transaction questioned, ask the courts
for the annulment of any contract of the husband entered
into without her consent, when such consent is required,
or any act or contract of the husband which tends to
defraud her or impair her interest in the conjugal
partnership property. Should the wife fail to exercise this
right, she or her heirs after the dissolution of the
marriage, may demand the value of property fraudulently
alienated by the husband.
, the nullity of the contract of sale is premised on the
absence of private respondent's consent. To constitute a
valid contract, the Civil Code requires the concurrence of
the following elements: (1) cause, (2) object, and (3)
consent
16. RUBIAS v. BATILLER
'Art. 1409. The following contracts are inexistent and
void from the beginning:
(7) Those expressly prohibited by law.
'ART. 1491. The following persons cannot acquire any
purchase, even at a public auction, either in person of
through the mediation of another: .

(5) Justices, judges, prosecuting attorneys, clerks of

superior and inferior courts, and other officers and
employees connected with the administration of justice,
the property and rights of in litigation or levied upon an
execution before the court within whose jurisdiction or
territory they exercise their respective functions; this
prohibition includes the act of acquiring an assignment
and shall apply to lawyers, with respect to the property
and rights which may be the object of any litigation in
which they may take part by virtue of their profession.'
Thus, if there has been a void transfer of property, the
transferor can recover it by the accion reinvindicatoria;
and any prossessor may refuse to deliver it to the
transferee, who cannot enforce the contract. Creditors
may attach property of the debtor which has been
alienated by the latter under a void contract; a
mortgagee can allege the inexistence of a prior
encumbrance; a debtor can assert the nullity of an
assignment of credit as a defense to an action by the
assignee.
Action On Contract. Even when the contract is void or
inexistent, an action is necessary to declare its
inexistence, when it has already been fulfilled
If the void contract is still fully executory, no party need
bring an action to declare its nullity; but if any party
should bring an action to enforce it, the other party can
simply set up the nullity as a defense.

We have no hesitation to declare that in this case, in the

eyes of the law, Socorro Roldan took by purchase her
wards parcels thru Dr. Ramos, and that Article 1459 of
the Civil Code applies.
Art.1459. The thing must be licit and the vendor must
have a right to transfer the ownership thereof at the time
it is delivered.
18. PICHEL v. ALONZO
The terms of the agreement are clear and unequivocal,
hence the literal and plain meaning thereof should be
observed. Such is the mandate of the Civil Code of the
Philippines which provides that:
Art. 1370. If the terms of a contract are clear and leave
no doubt upon the intention of the contracting parties,
the literal meaning of its stipulation shall control ... .
It has the essential elements of a contract of sale as
defined under Article 1485 of the New Civil Code which
provides thus:
Art. 1458. By the contract of sale one of the contracting
parties obligates himself to transfer the ownership of and
to deliver a determinate thing, and the other to pay
therefor a price certain in money or its equivalent.

17. PHIL. TRUST CO. v. ROLDAN