REVIEW OF CONTRACT LAW:

What is a contract?

-A contract is a meeting of minds between two persons whereby one binds

himself, in favor of another, to give something or to render some service.

What is the relation of contract to obligation?

-A contract is simply a source of an obligation. There are four other sources of

obligation; namely: Law, Quasi-Contract, Crime, Quasi-Delict..

What are the elements of a contract?

-Consent: manifested by the meeting of the offer and acceptance upon the thing
and the cause which are to constitute the contract. The offer must be certain and
absolute. A qualified acceptance constitute a counter ffer.

Who can give consent?

-anyone

Who cannot give consent?

-Minors, Deaf-mutes who cannot read or write, insane or demented,

persons suffering from penalty of Civil Interdiction, those adjudged
by court as incompetent, spouses with regard to the property owned
by the other spouse (unless there is a marriage settlement), those
exercising fiduciary relationships to a person and his property
[lawyers to their clients, judges as to objects being litigated in front
of them, government officials as to property whom they exercise
authority], any transaction between a married person and his/her
paramour.

-Cause: Understood to be, for each contracting party, the prestation or promise
of a thing or service or benefit which remunerated.

-Object: What cannot be objects of a contract?

a.) Those outside the commerce of persons

b.) Rights which are intransmissible

c.) Future inheritance

d.) Objects or services which are contrary to law, morals, good customs,
public order, etc.

e.) Impossible things or services

 f.) Those incapable of existing in the future

CONTRACT OF SALE

CONCEPT AND DEFINITION

-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 a price certain in money or its equivalent

CHARACTERISTICS OF CONTRACT OF SALE

1. Consensual- perfected by mere consent without any further act

2. Bilateral-both contracting parties are bound to fulfill obligations reciprocally
3. Onerous- because the thing sold is in consideration of price and vice versa
(youpay a price for this item)
4. Commutative- because the thing sold is considered to be equivalent of
price paid(object= price)
5. Nominate- has a specific name given to it by law
6. Principal- its existence doesn’t depend on the validity of another contract

REQUISITES OF A CONTRACT OF SALE

1. CONSENT OR MEETING OF THE MINDS- This refers to the consent of the

seller to deliver and transfer ownership and for the buyer or vendee to pay.
The parties should also have legal capacity to give consent and obligate
themselves. Where there is merely an offer by one party, without
acceptance, there is no consent. The acceptance of the payment =
consent
2. OBJECT- This refers to the determinate thing which is the object of the
contract. May be real or personal property

3. CAUSE- This refers to price certain in sum of money or its equivalent

(checks or promissory notes)

Buyer- promise to deliver

Seller- promise to pay

1.Essential Elements—necessary for the validty of the sale.

a. Meeting of the minds of the seller and the buyer

b. Object which is certain and determinate

c. Price certain

2. Natural Elements—those which are inherent in the contract and are deemed to
exist in the contract of sale in the absence of clear contrary agreement.

a. Warrant against eviction

 b. Warranty against hidden defects

3. Accidental Elements—May or may not exist depending on the stipulations of

the parties like conditions, payment of interest, place and time of payment.

KINDS OF CONTRACT OF SALE

1. ABOLUTE- where the sale is not subject to any condition and where the
title of the ownership passes to the buyer upon the delivery of the thing
sold
2. CONDITIONAL- where the contract is subject to certain conditions, usually
the full payment of the price. The ownership of the thing does no pass
unless conditionis fulfilled.

SALE DISTINGUISHED FROM OTHER CONTRACTS

SALE VS. CONTRACT TO SELL

-A Contract of Agency to Sell is a contract whereby one binds himself to

render service or to do something in behalf of another, with consent or authority.
Contract of Sale
Title over the property passes to the buyer
upon delivery unless there is a contrary
agreement.
Buyer has to pay the price
Contract to Sell
Ownership is retained by the seller
whether or not there is delivery.
Ownership passes to the buyer only upon
full payment of the price. Agent receives
the goods as the goods of the principal.
Agent has to take into account the
proceeds of the sale he may make on the
principal’s behalf

Buyer cannot return the thing sold
Seller warrants the thing sold
Agent can return the thing or object in
case of inability to sell the thing to a third
person
The agent makes no warranty for which he
assumes personal liability as long as he
acts within his authority and in the name
of the seller

CONTRACT OF SALE vs. CONTRACT FOR A PIECE OF WORK

-A CONTRACT FOR A PIECE OF WORK is a contract whereby the contractor

binds himself to execute a piece of work in behalf of or for the employer, in
consideration of a certain price or compensation
CONTRACT OF SALE CONTRACT FOR PIECE OF WORK
-general market -upon special order
-thing transferred is one which would -not of existence until the order of the
have existed party desiring to acquire it
-risk of loss borne by seller (warranty) -risk of loss borne by the buyer (damages)
SALE vs. BARTER

-Barter is a contract whereby one of the parties binds himself to give one thing
in consideration of another’s promise to give another thing
CONTRACT OF SALE BARTER

-if thing consists partly in money and
party in another thing, the manifest
intention of the parties paramount in
determining whether it is sale or barter
-if intention cannot be ascertained,
then it shall be considered barter if
the value of the thing given as part of
consideration exceeds the amount of
money or its equivalent