SALCLAW WEEK 7

PERFORMANCE or CONSUMMATION OF SALE

Obligations of Seller

1. To Preserve the subject matter – Art 1163 Every Person obliged to give a determinable thing
is also obliged to take care of it with the proper diligence of a good father of a family unless the
law or the stipulation of the parties requires another standard of care.
2. To Deliver the subject matter – Art 1495 (a.) To transfer the ownership of and (b.) to deliver
the thing, which is the object of the sale to the buyer.
- When there is no express provision that the title shall not pass until payment of the price,
and the thing sold has been delivered, title passes from the moment the thing sold is placed
in the possession of and control of the buyer. (kuenzle & streiff v watsons & co)
3. To Deliver the Fruits and accessories – Art 1164 The transferee has a right to the fruits of the
thing from the time the obligation to deliver it arises; however, he shall acquire no real right
over them until the same has been delivered to him.
4. To warrant the subject matter

Types of Delivery

a. Actual Delivery – There is actual or physical delivery when the thing sold is placed in the
control and possession of the buyer (Art 1497)
b. Constructive Delivery - The ownership of the thing sold is acquired by the vendee from the
moment it is delivered to him in any of the ways specified in Articles 1497 to 1501, or in any
other manner signifying an agreement that the possession is transferred from the vendor to
the vendee.
i. Execution of Public Instrument – (Gen. Rule) The execution of a public instrument has the
same legal effects as actual or physical delivery.
ii. Symbolic Delivery – as to movables, delivery of keys of the place or depository where the
movable is stored or kept.
iii. Traditio Longa Manu – Delivery of a thing merely by agreement, such as when the seller
points the property subject matter of the sale by way of delivery without need of actually
delivering physical possession thereof.
-For example, if a party purchases a car from an auto dealer that is on the auto dealer’s lot,
the transferror auto dealer will deliver the vehicle to the transferee/purchaser at the
purchaser’s home.
iv. Constitutum Possessorium – The seller held possession of the subject matter as owner,
and due to contract, the seller continues to hold physical possession thereof not as an
owner but a lessee or any other form of possession other than in the concept of owner.
v. Traditio Brevi Menu – Opposite of constitutum possessorium. The would-be buyer was
already in possession of the would-be subject matter of the sale as a lessee, and due to
sale, he would now hold possession as an owner.
 c. Delivery through carrier – Pertains only to sale of goods. (Gen. Rule)Delivery to carrier is
deemed delivery to the buyer (FOB Shipping Point)
i. FAS Sale – The seller pays all charges and is subject to risk until the goods are placed
alongside the vessel. FAS is ONLY used for ocean or inland waterway transport.
ii. F.O.B. Sales – Free on Board.
1. FOB Shipping Point – Risk of loss of the seller is only up to the Carrier or the shipping
point.
2. FOB Destination – Risk of loss of the seller is until when the vessel has arrived at the
point of destination.
iii. C.I.F. Sales – Costs, Insurance, and Freight. Signifies that the price fixed covers not only the
costs of the goods, but also of Freight and Insurance to be paid by the seller.

COMPLETENESS OF DELIVERY

Movables

-Seller delivers less than the quantity contracted.

o Buyer may reject.
o If the buyer accepts knowing that the seller is not going to perform the contract in
full, he must pay the full price.
o If the buyer does not know and he used the goods, he shall not be liable for the full
price.
- Seller delivers large quantity than the contracted qty.
o Buyer may accept the goods in the contract and reject the rest.
o If the buyer accepts the whole, he must pay at the contract rate.
o If indivisible, buyer may reject the whole goods.
Immovables
- Sold per unit or number – with the statement of area at the rate of a certain price for a unit
or measure or number
- If the vendee should demand, the vendor shall deliver all that may have been stated in the
contract.

DOUBLE SALE

Requisites of double sale

1. Two or more transactions must constitute valid sales

2. They must pertain exactly to the same object or subject matter
3. They must be bought from the same or immediate seller
4. Two or more buyers who are at odds over the rightful ownership of the subject matter must
represent conflicting interests

Instances where double sale does not apply

1. Not all the requisites are present

2. Two different contract of sale are made by two different persons, one of them not being the
owner of the property sold.
3. The land sold is not registered under the Torrents System (Act. No. 3344)
a. under Act No. 3344, registration of documents affecting unregistered land cannot
affect a third party with a better right to the unregistered land. The mere registration
of a sale in one’s favor does not give him any right over the land if the vendor was not
anymore the owner of the land, having previously sold the same to somebody else,
even if the earlier sale was unrecorded.
4. The first sale occurs when land is not yet registered and the second sale is done when the land
is already registered – the principle of prior tempore, potior jure (he who is first in time is
preferred in right) should apply.

General Rules on Double Sale, the ownership shall be given:

Movable

- Who may have first taken possession thereof in good faith.

Immovable

- Who in good faith first recorded (the sale) in the registry of Property.
- Should there be no inscription, to the person who in good faith was first in the possession
of the subject matter.
- In the absence thereof, to the person who presents the oldest title, provided there is good
faith.

Purchaser in good faith means

- Buys the property without the knowledge that some other person has a right to, or interest
in, such property.
- Pays a full and fair price for the same at the time of such purchase, or before he has notice
of the claim or interest of some other person in the property.

Burden of proof – he who asserts the status of a purchaser in good faith and for value has the
burden of proving such assertion.

Lis Pendens – This refers to a pending legal action. A buyer cannot be considered an innocent
purchaser for value where he ignored the notice of lis pendens on the title when he bought the lot.

First buyer is always in good faith – knowledge gained by the first buyer of the second sale cannot
defeat the first buyer’s rights except only as provided by the civil code and that is where the second
buyer registers in good faith the second sale ahead of the first.

Caveat Emptor - the principle that the buyer alone is responsible for checking the quality and
suitability of goods before a purchase is made.