Professional Documents
Culture Documents
A:
1. With separate consideration:
a. Contract is valid
b. Offeror cannot withdraw offer until after expiration of
the option
c. Is subject to rescission & damages but not specific
performance
Subject matter and price must be There must be subject matter but
valid price not important
A:
Payment of the price
GR: Seller is not bound to deliver unless the purchase
price is paid
XPN: A period of payment has been fixed
Accept delivery of thing sold
Pay for expenses of delivery
Q: What are the other obligations of the buyer?
A:
To take care of the goods without the obligation to return,
where the goods are delivered to the buyer and he rightfully
refuses to accept;
Note: The goods in the buyers possession are at the sellers risk.
2. To be liable as a depositary if he voluntarily constituted
himself as such;
3. To pay interest for the period between delivery of the
thing and the payment of the price in the following cases:
a. should it have been stipulated;
b. should the thing sold and delivered produces fruits or
income; or
c. should he be in default, from the time of judicial or
extrajudicial demand for the payment of the price.
OBLIGATIONS OF THE SELLER
Q: What are the obligations of the seller?
A: DDTWTP
Deliver the thing sold;
Deliver fruits & accessions/accessories accruing from
perfection of sale;
Transfer the ownership;
Warranties;
Take care of the thing, pending delivery, with proper
diligence;
Pay for the expenses of the deed of sale unless there is a
stipulation to the contrary
Q: What are the characteristics of a contract of
sale?
A:
Consensual
Bilateral
GR: Commutative
A:
Where subject matter is indeterminate
Sale of future goods
Stipulation that deed of sale &
corresponding certificate of sale would be
issued only after full payment
Q: Who are the parties to a contract of
sale?
A:
Seller one who sells and transfers the thing
and ownership to the buyer
Buyer one who buys the thing upon
payment of the consideration agreed upon
Q: Who may enter into a contract of sale?
A:
GR: Any person who has capacity to contract or
enter into obligations, may enter into a contract of
sale, whether as partyseller or as partybuyer.
XPN:
Minors, insane and demented persons and deafmutes
who do not know how to write
Persons under a state of drunkenness or during hypnotic
spell
Husband and wife sale by and between spouses
XPN to XPN:
Where necessaries are sold and delivered to a minor or
other person without capacity to act, he must pay a
reasonable price therefor.
In case of sale between spouses:
A:
Unemancipated minors(Art. 1327, NCC);
Insane or demented persons, and deafmutes who do not
know how to write (Art. 1327, NCC)
A:
Spouses (Art. 1490, NCC)
Agents, Guardians, Executors and Administrators, Public
Officers and Employees, Court Officers and Employees,
and others specially disqualified by law. (Art. 1491, NCC)
A:
1. That entered into by minors:
a. Merely voidable, subject to annulment or ratification
b. Action for annulment cannot be instituted by the
person who is capacitated since he is disqualified from
alleging the incapacity of the person with whom he
contracts (with partial restitution in so far as the
minor is benefited) where necessaries are sold and
delivered to a minor or other person without capacity
to act, he must pay a reasonable price (Art. 1489)
2. Sale by & between spouses (Art. 1490):
a. Status of prohibited sales between spouses:
GR: Null and void
XPN: In case of sale between spouses:
When a separation of property was agreed upon in the
marriage settlements; or
. When there has been a judicial separation of
property agreed upon between them
Reasons:
revent defrauding creditors
. Avoid situation where dominant spouse takes
advantage over the weaker spouse
. Avoid circumvention on prohibition of donation
between spouses
Between Common Law Spouses also null and void.
In CalimlimCanullas v. Fortun, the Court decided that
sale between common law spouses is null and void
because Art. 1490 prohibits sales between spouses to
prevent the exercise of undue influence by one spouse
over the other, as well as to protect the institution of
marriage. The prohibition applies to a couple living as
husband and wife without the benefit of marriage,
otherwise, the condition of those incurred guilt would
turn out to be better than those in legal union.
(CalimlimCanullas v. Fortun, et. al., G.R. No. L57499,
June 22, 1984)
But when the registered property has been conveyed
subsequently to a thirdparty buyer in good faith and
for value, then reconveyance is no longer available to
commonlaw spouseseller, since under the Torrens
system every buyer has a right to rely upon the title of
his immediate seller. (Cruz v. CA, G.R. No. 120122, Nov.
6, 1997)
Q: Who has the right to assail the
validity of the transaction
between spouses?
A: The following are the only persons who can
question the sale between spouses:
The heirs of either of the spouses who have been
prejudiced;
Prior creditors; and
The State when it comes to the payment of the proper
taxes due on the transactions
Q: Who are those persons specially disqualified
by law to enter into contracts of sale? A:
ALIENUnOS
ALIENs who are disqualified to purchase private agricultural
lands (Art. XII Secs. 3 & 7)
Unpaid seller having a right of lien or having stopped the
goods in transitu, is prohibited from buying the goods either
directly or indirectly in the resale of the same at
public/private sale which he may make (Art. 1533 [5]; Art.
1476 [4])
The Officer holding the execution or deputy cannot become
a purchaser or be interested directly or indirectly on any
purchase at an execution. (Sec. 21 Rule 39, Rules of Court)
In Sale by auction, seller cannot bid unless notice has been
given that such sale is subject to a right to bid in behalf of the
seller. (Art. 1476)
Q: Atty. Leon G. Maquera acquired his clients
property as payment for his legal services, then
sold it and as a consequence obtained an
unreasonable high fee for handling his clients
case. Did he validly acquire his clients property?
A: No. Article 1491 (5) of the New Civil Code prohibits
lawyers acquisition by assignment of the clients
property which is the subject of the litigation handled
by the lawyer. Also, under Article 1492, the prohibition
extends to sales in legal redemption. (In Re: Suspension
from the Practice of Law in the territory of Guam of
Atty. Leon G. Maquera, B.M. No. 793, July 30, 2004)
Q: What are the requisites of a proper object of sale?
A:
1. Things
a. Determinate or determinable
b. Lawful (licit), otherwise contract is void
c. Should not be impossible (within the commerce of men)
2. Rights
GR: Must be transmissible.
XPN:
a. Future inheritance
b. Service cannot be the object of sale. They are not
determinate things and no transfer of ownership is
available but it can be the object of certain contracts such
uas contract for a piece of work. (Pineda, Sales, 2002 ed., p.
13)
Q: Rodriguez first purchased a portion of a Lot A
consisting of 345 square meters located in the
middle of Lot B, which has a total area of 854
square meters, from Juan. He then purchased
another portion of said lot. As shown in the
receipt, the late Juan received P500.00 from
Rodriguez as "advance payment for the
residential lot adjoining his previously paid lot on
three sides excepting on the frontage. Juans heirs
now contests the validity of the subsequent sale,
alleging that the object is not determinate or
determinable. Decide.
A: Their contention is without merit. There is no
dispute that Rodriguez purchased a portion of Lot A
consisting of 345 square meters. This portion is located
in the middle of B, which has a total area of 854 square
meters, and is clearly what was referred to in the
receipt as the "previously paid lot." Since the lot
subsequently sold to Rodriguez is said to adjoin the
"previously paid lot" on three sides thereof, the subject
lot is capable of being determined without the need of
any new contract. The fact that the exact area of these
adjoining residential lots is subject to the result of a
survey does not detract from the fact that they are
determinate or determinable. Concomitantly, the
object of the sale is certain and determinate. (Heirs of
San Andres v. Rodriguez, G.R. No. 135634, May 31, 2000)
Q: What may be objects of sale?
A:
1. Existing Goods owned/ possessed by
seller at the time of perfection
2. Future Goods goods to be manufactured,
raised, acquired by seller after perfection of
the contract or whose acquisition by seller
depends upon a contingency (Art. 1462)
3. Sale of Undivided Interest or Share
a. Sole owner may sell an undivided interest. (Art.
1463) Ex. A fraction or percentage of such property
b. Sale of an undivided share in a specific mass of
fungible goods makes the buyer a coowner of the
entire mass in proportion to the amount he bought.
(Art. 1464)
c. A coowner cannot sell more than his share
(Yturralde v. CA)
4. Sale of Things in Litigation
a. Sale of things under litigation is rescissible if
entered into by the defendant , without the approval of
the litigants or the court (Art. 1381)
b. No rescission is allowed where the thing is legally in
the possession of a 3rd person who did not acted in
bad faith.
5. Things subject to Resolutory Condition. Ex. Things
acquired under legal or conventional right of
redemption, or subject to reserva troncal. (Art. 1465)
6. Indeterminate Quantity of Subject Matter
a. The fact that the quantity is not
determinate shall not be an obstacle to the
existence of the contract provided it is
possible to determine the same, without
need of a new contract. (Art. 1349)
Q: Should the seller be the owner at the
time of perfection of the contract?
A:
GR: No. Seller must have the right to
transfer ownership at the time of delivery or
consummation stage. He need not be the
owner at the time of perfection of the
contract.
XPN: Foreclosure sale wherein the
mortgagor should be the absolute owner.
Q: EJ was subjected to a buybust operation where
police officers posed to buy 500 pesos worth of S.
She was then charged with a violation of the
Dangerous Drugs Act for trafficking drugs. EJ uses
as defense her lack of possession of the object of
the sale. Would her contention free her from
liability?
A: No. Though she was not in possession of the object
of sale, Article 1459 merely requires that the vendor
must have the right to transfer ownership of the object
sold at the time of delivery. In the case at bar, though
Beth is not the owner, she had the right to dispose of
the prohibited drug. Ownership was thereafter
acquired upon her delivery to the men in the alley after
her payment of the price. (People v. Ganguso, G.R. No.
115430, Nov. 23, 1995)
Q: What is the status of a sale by a person who
does not own the thing subject of the sale?
A: It depends upon the stage of the sale.
When seller is not owner at perfection stage the
sale is valid.
Ownership of the subject matter by the seller at this
stage is not an essential requirement for the validity of
sale. It is necessary at the time of delivery. Hence, a valid
contract of sale can cover subject matter that is not yet
existing or even a thing having only a potential existence
at the time of perfection; or even a thing subject to a
resolutory condition
2. When seller is not owner at consummation stage
a. Old view the contract of sale is valid, but the
transfer of title is void. (MindanaoAcademy, Inc. v.
Yap, G.R. No. L17681, Feb. 26, 1965)
b. New view the sale by a nonowner of the subject
property is void instead of treating the
tradition/delivery aspect as having no effect on
transferring ownership to the buyer. (DBP v. CA, G.R.
No. 110053, Oct. 16, 1995)
Q: What is the legal effect of sale by a
nonowner?
A:
GR: The buyer requires no better title to the goods
than the seller had; caveat emptor (buyer beware).
XPN:
Estoppel when the owner of the goods is by his
conduct precluded from denying the sellers authority to
sell
When the contrary is provided for in recording laws
3. When the sale is made under statutory power of sale
or under the order of a court of competent jurisdiction
4. When the sale is made in a merchants store in
accordance with the Code of Commerce and special
laws
5. When a person who is not the owner sells and
delivers a thing, and subsequently acquired title
thereto
6. When the seller has a voidable title which has not
been avoided at the time of the sale
7. Sale by coowner of the whole property or a definite
portion thereof
8. Special rights of unpaid seller
Q: What are the instances when the Civil Code
recognizes sale of things not actually or already owned
by the seller at the time of sale?
A:
Sale of a thing having potential existence (Art.1461, NCC)
Sale of future goods (Art. 1462, NCC)
Contract for the delivery at a certain price of an article,
which the seller in the ordinary course of business
manufactures/ procures for the general market, whether
the same is on hand at the time or not (Art. 1467, NCC)
Q: What is the effect of a sale made by the
seller with voidable title over the object?
A:
1. Perfection stage: valid buyer acquires title of goods
2. Consummation stage: valid If the title has not yet
been avoided at the time of sale and the buyer must buy
the goods under the following conditions:
a. In good faith
b. For value
c. Without notice of sellers defect of title
EMPTIO REI SPERATAE EMPTIO SPEI
A:
If there is a stipulation
If it be with reference to another thing certain
If the determination of the price is left to the judgment
of specified person(s)
By reference to certain fact(s) as referred to in Art. 1472
(Art. 1469
Q: What is the effect of gross inadequacy of
price?
A:
GR: It does not affect the validity of the sale if it is
fixed in good faith and without fraud
XPN: CoRDS
If Consent is vitiated (may be annulled or presumed to
be equitable mortgage)
If the parties intended a Donation or some other act/
contract
If the price is so low as to be Shocking to the
conscience
If in the event of Resale, a better price can be obtained
Q: What is the effect if the price is simulated?
A:
GR: Contract of sale is void.
XPN: The act may be shown to have been in reality a
donation or some other act or contract.
Q: What is considered reasonable price?
A: Generally the market price at the time and place
fixed by the contract or by law for the delivery of the
goods.
Q: What is the effect on the contract of sale in case of a
breach in the agreed manner of payment?
A: None. It is not the act of payment of price that
determines the validity of a contract of sale. Payment of the
price has nothing to do with the perfection of the contract,
as it goes into the performance of the contract. Failure to
pay the consideration is different from lack of
consideration. Failure to pay such results in a right to
demand the fulfillment or cancellation of the obligation
under an existing valid contract. On the other hand, lack of
consideration prevents the existence of a valid contract.
(Sps. Bernardo Buenaventura and Consolacion Joaqui v. CA,
GR No. 126376, Nov. 20, 2003)
Q: Is payment of the purchase price essential to
transfer ownership?
A: Unless the contract contains a stipulation that
ownership of the thing sold shall not pass to the
purchaser until he has fully paid the price, ownership
of the thing sold shall be transferred to the vendee
upon the actual or constructive delivery thereof. (Diaz,
p. 48)
Q: What is the effect of failure to determine the
price?
A:
Where contract is executory ineffective
Where the thing has been delivered to and appropriated
by the buyer the buyer must pay a reasonable price
therefore