Nature And Form Of The Contract (Article 1458-1488)

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what is contract of sale?

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by the contract of sale one of the contracting parties obligates himself to transfer the ownership of & to deliver a determinate thing, and the other to pay therefore a price certain in money or its equivalent.

a contract of sale may be absolute or conditional.

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characteristic of a contract of sale

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1. consensual
2. bilateral
3. principal
4. onerous
5. commutative
6. nominate

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essential requisites

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1. consent
2. subject matter
3. consideration

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kinds of contract of sale

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1. absolute
2. conditional

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the sale is not subject to any condition whatsoever & where title or ownership passes to the buyer upon delivery of the thing sold

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absolute

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where the sale contemplates a contingency and in general where the contract is subject to certain conditions

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conditional

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requisites concerning object

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1. determinate, licit, not be impossible
2. all rights which are not intransmissible or personal may also be the object of sale

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kinds of illicit things

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a. illicit per se
b. illicit per accidens

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right of vendor to transfer ownership

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1. one can sell only what he owns
2. sufficient if right exists at time of delivery

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subject matter must be determinate

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1. when thing determinate
2. sufficient if subject matter capable of being made determinate

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article 1461

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1. things having potential existence as object of sale
2. sale of a vain hope or expectancy is void

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goods which may be the object of sale

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1. existing goods
2. future goods

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future goods as object of sale

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valid only as an executory contract to be fulfilled by the acquisition & delivery of the goods specified

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article 1463

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the sole owner of a thing may sell an undivided interest therein

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goods of which any unit is, from its nature or by mercantile usage, treated as the equivalent of any other unit such as grain, oil....

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fungible goods

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effect of sale of an undivided share

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a. buyer becomes a co owner w/ the seller of the whole mass
b. buyer becomes the owner of the whole mass, seller shall supply whatever is lacking

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subject matter in sale of an undivided share

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incorporeal right

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an uncertain event upon the happening of which the obligation subject to it is extinguished

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resolutory condition

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distinguished sale & agency to sell

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1. ownership
2. payment
3. return of the objects
4. dealings with the thing

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sale distinguished from contract for a piece of work

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1. existence of the thing
2. risk of loss
3. statute of frauds

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one of the parties binds himself to give 1 thing in consideration of the other's promise jo give another thing

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contract of barter

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contractor binds himself to execute a piece of work for the employer, in consideration of a certain price or compensation

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contract for a piece of work

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meeting of minds between 2 persons whereby 1 binds himself, with respect to the other, to give something or to render some service

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contract

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sum stipulated as the equivalent of the thing sold & also every incident taken into consideration for the fixing of the same, put to the debit of the vendee & agreed to by him

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price

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the price is certain if

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1. the parties have fixed or agreed upon a definite amount
2. it be certain w/ reference to another thing certain
3. the determination of price is left to the judgement of a specified person or persons

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exception if the price is fixed by 3rd person

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1. acts in bad faith or by mistake
2. incompetent or in bad faith

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effect if price is not fixed by the 3rd person designated

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1. refuses or cannot fix, ineffective
2. prevented from fixing the price by fault

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effect of gross inadequacy of price in voluntary sales

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1. general rule
2. where low price indicates defect in the consent
3. where price simulated
4. where parties do not intend to be bound at all

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one made by a court with respect to the property of a debtor for the satisfaction of his unpaid indebtedness

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judicial or execution sale

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where price is so low as to be shocking to the conscience

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set aside by the court

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where seller given the right to repurchase

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right to redeem

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price on a given day at particular market

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amount must be certain

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fixing of price by one of the contracting parties not allowed

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if accepted by the other, the contract is deemed perfected

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effect of failure to determine price

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1. where contract executory
2. where delivery has been made

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perfection of contract sale

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at the moment there is a meeting of minds

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rules governing auction sales

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1. sales of separate lots by auction are separate sales
2. sale perfected by the fall of the hammer
3. right of seller to bid in auction

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ownership of thing is transferred by delivery

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however, the parties may stipulate that despite the delivery, the ownership of the thing shall remain with the seller until purchaser has fully paid the price.

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kinds of promise treated in article 1479

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1. an accepted unilateral promise to sell in which the promisee elects to buy
2. an accepted unilateral promise to buy in which the promisee elects to sell
3. a bilateral promise to buy & sell reciprocally accepted in which either of the parties chooses to exact fulfillment

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policitation

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unaccepted unilateral promise, no juridical effect

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option

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accepted unilateral promise

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if the thing is lost before perfection

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the seller bears the loss

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if the thing is lost at the time of perfection

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the contract is void or inexistent

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if the thing is lost after the perfection but before its delivery

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the risk of loss is shifted to the buyer

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if the thing is lost after the delivery

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the buyer bears the risk of loss

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scope of article 1480

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1. non fungible things & fungible things sold for a price not fixed in relation to weight... - buyer take the risk of the thing sold even before delivery
2. fungible things sold for a price fixed in relation weight... - seller bears the risk

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where a seller sells things as being of a particular kind

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sale by description

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parties contracted solely w/ reference to the sample, w/ the understanding that the bulk was like it

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sale by sample

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goods satisfy all the warranties

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sale by description and sample

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advance payment

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earnest money

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distinguish earnest money to option money

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1. part of purchase price
2. where there is already a sale
3. bound to pay the balance

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under statute of frauds, the contracts that must be in writting are....

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1. sale of personal property at a price not less than P500.00
2. sale of real property or anu interest therein regardless of price involved
3. sale of real property not to be performed within a year from the date thereof regardless of the nature & price involved

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remedies of vendor in sale of personal property payable in installments

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1. elect fulfillment upon the vendee's failure to pay
2. cancel the sale, if thr vendee shall have failed to pay 2 or more installments
3. foreclose the chattel mortgage, if one has been constituted, if the vendee shall have failed to pay 2 or more installments

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right of vendor to recover unpaid balance of purchase price

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1. remedy of specific performance
2. remedy of cancellation
3. remedy of foreclosure