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SALES REVIEWER
1 |
INTRODUCTION
 
 
SALES REVIEWER
2 |
INTRODUCTION
 
I
NTRODUCTION
I.
 
Definition.
[1458]
 
a.
 
one of the contracting parties obligates himself to transfer the ownershipof and to deliver a determinate thing; andb.
 
the other to pay therefor a price certain in money or its equivalent
 
II.
 
 Elements
 
a.
 
Essential elements— those without which, there can be no valid sale(c
onsent, object, price
)
 
b.
 
Natural elements— inherent and are deemed to exist even in the absenceof contrary provision, save those in the contrary (
warranties againsteviction and hidden defects
)
 
c.
 
Accidental elements —dependent on the parties’ stipulation (
e.g.conditions, interest, penalty, time or place of payment)
III.
 
Stages
 
a.
 
Negotiation—covers the period from the time the prospective partiesindicate interest in the contract until it is perfected
 
b.
 
Perfection—meeting of the minds as to the object of contract and uponthe price
 
c.
 
Consummation—object is delivered and the price is paid
 
IV.
 
Characteristics
[CBOC NP]
 
a.
 
Consensual—it is perfected at the moment there is a meeting of the mindsupon the thing, which is the object of the contract and the upon the price.xxx [1
 
475]
 
b.
 
Bilateral —
 
i.
 
one of the contracting parties obligates himself to transfer theownership of and to deliver a determinate thing and the other topay therefor a price certain in money or its equivalent [1458].ii.
 
as a consequence
:
1.
 
power rescind is implied in case one of the obligors shouldnot comply with what is incumbent upon him [1191]
 
2.
 
neither party incurs in delay if the other does not complyor is not ready to comply in proper manner what isincumbent upon him [1169]
 
c.
 
Onerous—valuable consideration is necessary for the contract to be valid(price)
 
 
Comment [vsf1]:
By the contract of sale oneof the contracting parties obligates himself totransfer the ownership and to deliver adeterminate thing, and the other to pay therefora price certain in money or its equivalent.
Comment [vsf2]:
The contract of sale isperfected at the moment there is a meeting ofminds upon the thing which is the object of thecontract and upon the price.From that moment, the parties may reciprocallydemand performance, subject to the provisionsof the law governing the form of contracts.
 
SALES REVIEWER
3 |
INTRODUCTION
 
d.
 
Commutative—what is done, given, or promised by one party isconsidered as equivalent to or in consideration of what is done, given orpromised by the other
 
e.
 
Nominate—the civil code refers to it by special designation or name
 
f.
 
Principal—for the contract of sale to exist, there is no necessity for it todepend upon the existence of another valid contract
 
V.
 
Distinguished from other contracts
 
a.
 
Sale v Donation
 
i.
 
the contract of sale is an onerous contract; a donation is agratuitous contract, the consideration being liberality [7
 
25].ii.
 
Hence,
a sale where the price is simulated is void. But it may beshown to have been a donation [1
 
471]
 
b.
 
Sale v Barter
 
i.
 
in a sale, one of the contracting parties obligates himself totransfer the ownership of and to deliver a determinate thing andthe other to pay therefor a price certain in money or its equivalent[1458].ii.
 
in a barter, one of the parties binds himself to give one thing inconsideration of the other’s promise to give another things
 
NOTE:
If the consideration is partly in money and partly in anotherthing
 
, the nature of the contract will depend on [1468]:1.
 
the manifest intention of the parties2.
 
if the intent is not clear, apply the
 ff 
rules:a.
 
if the thing is more valuable than money—
barter 
 b.
 
if the money and the thing are of equal value—
sale
 c.
 
if the thing is less valuable than money—
sale
 c.
 
Sale v Piece of Work [1
 
467]i.
 
vendor, in the ordinary course of his business, manufactures orprocures the thing sold for the general market, whether the sameis on hand at the time or not —
sale
ii.
 
goods are to be manufactured specially for the customer and uponhis special order and not for the general market—
 piece of work
iii.
 
Tests under jurisprudence
 
1.
 
Habituality test: WON the job requires the use ofextraordinary or additional equipment, or involvesservices not generally performed [
Celestino v. CIR
]
 
1.
 
WON the thing is one which would have never existed butfor the order of the party desiring to acquire it, or one
 
Comment [vsf3]:
Donation is an act ofliberality whereby a person disposesgratuitously of a thing or right in favor ofanother, who accepts it.
Comment [vsf4]:
If the price is simulated, thesale is void, but the act may be shown to havebeen in reality a donation, or some other act orcontract.
Comment [vsf5]:
If the consideration of thecontract consists partly in money, and partly inanother thing, the transaction shall becharacterized by the manifest intention of theparties. If such intention does not clearlyappear, it shall be considered a barter if thevalue of the thing given as a part of theconsideration exceeds the amount of the moneyor its equivalent; otherwise, it is a sale
Comment [vsf6]:
A contract for the deliveryat a certain price of an article which the vendorin the ordinary course of his businessmanufactures or procures for the generalmarket, whether the same is on hand at the timeor not, is a contract of sale, but if the goods areto be manufactured specially for the customerand upon his special order, and not for thegeneral market, it is a contract for a piece ofwork.
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