ARTICLE 1315 (Consensual Contracts + Consequence) 1316 (Real Contracts) 1317 (Unenforceable contracts) 1318 (3 Requisites) 1319 (Consent)

Purefoods : the letter to FEMSCO had a counter-offer which FEMSCO failed to send its
conforme = it had reason to revoke the offer = no contract was perfected
Purefoods installed 2-1500 kW generators in its food processing plant in Marikina City
Jardine : No record to show that it had knowledged of the prior contract between
where a bidding was held.
Purefoods and FEMSCO nor that it induced Purefoods to violate such contract
Purefoods confirmed that FEMSCO won the bid. FEMSCO submitted the performance
Article 1315 : Contracts are perfected by mere consent (3 requisites) and from
bond and contractor's all-risk insurance policy
Jadine Davies v. CA that moment, the parties are bound not only to the fulfillment of what has been
Purefoods unilaterally cancelled the award due to some factors. FEMSCO protested.
expressly stipuated but also to all the consequences which, according to their
Purefoods then awarded it to Jardine Nell, a division of Jardine Davies
Purefoods unilaterally revoked a nature may be in keeping with good faith, usage, and law.
FEMSCO : Purefoods to honor its contract + Jardine to cease and desist from delivering
perfected contract. Jardine did not Article 1326 on advertisements
and installing the generators. FEMSCO sued both
induce Purefoods to violate the The 12 December 1992 letter constituted acceptance of Purefoods. The terms and
CA ordered Jardine to pay FEMSCO for INDUCING Purefoods to violate the latter's
latter's contract with FEMSCO conditions were imposed on the performance of the obligation rather than on the
contract with FEMSCO
perfection of the contract.
The submission of perforamance bond can also be considered as FEMCO's
Issue : Did Jardine induce or connive with Purefoods to violate the latter's contract with
acquiescence to the conditional counter-offer
Jardine?
The contract between Purefoods and FEMSCO has been perfected.
There was no showing that Jardine induced Purefoods

Nida Lopez, manager of COMBANK, asked Jazmin Soler to submit designs for the
renovation of ther branch offices. Promised that Ms. Soler would be compensated for
her services and that her professional fee would be 10,000.00
Soler hired and paid draftsman, engineer, and architects and contacted her suppliers. Article 1318 (3 requisites) + 3 stages of a contract
She submitted the lay out and design to Ms. Lopez in December 1986. From their discussions and meetings, it was apparent that Ms. Lopez had the authority
Soler demanded payment for her services from Lopez, but Lopez just ignored them. to engage the services of Soler.
Soler v. CA Lopez : Soler is not entitled to payment. She did not comply with the bank standards There was a perfected oral contract
and there was no agreement betweet her and the bank. First stage : When they met and discussed
There was a perfected oral contract COMBANK : There was no contract between them and Soler was only invited to submit Second stage : When they agreed the payment and delivery of designs
bid for the renovation Third stage : When Soler delivered her designs
Soler : There was a perfected contract, there having an offer and acceptance of ther = the contract was consummated/perfected
services

Issue : Was there a perfected contract between Soler and Lopez/COMBANK?

Whether Lopez had the authority to bind COMBANK in the transaction

Province of Cebu, as successor-in-interest of the City of Cebu is bound to respect the

contract of sale between Morales and the City of Cebu
The award was tantamount to a perfected contract of sale between Morales and the
City of Cebu while the partial payment of the purchase price and actual occupation of
Province of Cebu leased the property to Rufina Morales. In 1964, the Province of Cebu
the property by Morales and respondents effectively transferred ownership of the lot to
donated the said property to the City of Cebu. A TCT was issued in favor of the City of
the latter.
Cebu
Province of Cebu v. Morales There was a meeting of the minds between the City of Cebu and Morales as to the
City of Cebu sold it to Hever Bascon, Morales was allowed to match the highest bid.
lot sold and its price. Partially consummated due to failure to pay the full
Morales made deposit and partial payment.
A Contract of Sale is perfected by purchase price
Province of Cebu reversed the donation. Province of Cebu and City of Cebu entered
mere meeting of the minds. A formal A contract of Sale is a consensual contract.
into a Compromise Agreement. The property of Morales was erroneously included in
document is not necessary for the Article 1458 Contract of Sale
the list of properties returned.
sale transaction to acquire binding 1) Consent or meeting of the minds
Morales died without fully paying the purchase price. Her heirs requested the Province
effect 2) Determine the subject matter
of Cebu for the formal conveyance of the said lot.
3) Price certain in money or its equivalent
All were present in the transaction between the City of Cebu and Morales
Issue : Was there a perfected contract between Morals and the City of Cebu?
Unpaid balance = gave rise to a right to demand specific performance
The vendee may pay the balance, as long as no demand of rescission of the contract
has been made upon him either judicially or extrajudicially = Respondents could still
tender payment for the full purchase price (Article 1592)

Thio received from Garcia crossed checks payable to the order of Marilou Santiago
(Thio loaned the amounts of the checks from Garcia)
Garcia v. Thio
Garcia did not issue Promissory Notes since they were close friends at that time. Thio
was able to pay the interests but not the principal amounts depsite repeated demands
A loan is real contract that is
Thio : Denied that she loaned the amounts and it was Marilou Santiago to whom Garcia
perfected upon the delivery of the
lent the money
object of the contract
Issue : Was there a contract of loan between Garcia and Thio?
A loan is a real contract that is perfected upon the delivery of the object. Upon the
delivery, the debtor acquires ownership of such money or loan proceeds and is bound
to pay the creditor an equal amount.
The checks were delivered to Thio but were crossed and payable to order of Marilou
Santiago. BUT, once Thio received the checks, they were within her actual or
constructive possession = control. They were placed under her control and possession
under an arrangement whereby she actually re-lent the amounts to Santiago
NO interest shall be due unless it has been expressly stipulated in writing

There was a perfected contract between the parties since all the essential requisites of
a contract were present. Article 1318 1) consent 2) object certain 3) cause of the
obligation
Pangan sold an apartment to Sps. Perreras. Pangan received 20,000.00 as earnest
That a things is sol without the consent of all the co-owners does not invalidate the
money
sale or render it void.
Sps. Perreras issued checks which Pangan refused to accept because her children, as
A co-owner may sell her pro-indiviso share, like Consuelo in this case.
heirs, did not want to sell the property. Pangan offered to return the earnest money
Pangan v. Perreras All the elements of a perfected contract are present in this case.
which the Sps. Perreras refused to accept
Without a stipulation that the vendor made reservation on the ownership of the property
Sps. Perreras sought to compel Pangan to enforce the agreement and execute the
A co-owner may sell her pro-indiviso = the parties' agreement may be considered a contract of sale
Deed of Sale
share Non-payment in Contract of Sale : Party may pay before rescission
Petitioner-heirs : It was a contract to Sell. The payment of purchase price is the positive
Non-payment in Contract to Sell : Does not constitute a breach, nonpayment is a
suspensive condition
condition that prevents the obligation from acquiring obligatory force and results in its
cancellation. It is a positive suspensive condition. Non-fulfillment = ineffective and
Issue : Was there a perfected contract?
without force and effect
Maceda Law : Defaulting vendee has 60-day grace period to still pay the installments
due

Robern Development v. People's
Landless (PELA)
No perfected contract of sale for
want of consent and agreement on
the price. No double sale
Al-Amanah owend a lot and asked members of PELA to desist from building their
houses on the lot and vacate the same unless they are interested to buy it
Illegal settlers offered to buy the land but Al-Amanah declined because their offer was
far below the asking price
300,000.00 offer by PELA was subsequently acknowledged/received (150,000.00 paid )
Al-Amanah top management turned down PELA's offer to buy the property.
Robern wrote a letter indicating that it is interested to buy the lot for 400,000.00. The
offer was accepted + it was Robern's responsibility to eject the occupants in the subject
lot.
Al-Amanah : The 150,000.00 handed by PELA was not part of the payment but merely a
deposit in connection with its offer. They never entered into sa sale with PELA for there
was no perfected agreement as to the price since the Head Office rejected PELA's offer
Issue : Was there a perfected contract between PELA and Al-Amanah?
3 essential elements for a contract of sale to be valid.
No perfected contract of sale for want of consent and agreement on the price.
They did not agree on the price, nor was consent given whether implied or express
18 March 1993 letter of PELA was merely an offer to buy. The bank note also cannot
be construed as acceptance of PELA's offer to buy. The annotation simply means that
the bank acknowledged receipt of PELA's offer.
The bank never signified its approval/acceptance of PELA's offer to buy the property
The 150,000.00 was not earnest money. Banks usually require an offeror to submit or
make deposits. They do not entertain any offer without a deposit.
The transactions between PELA and Al-Amanah remained in the negotiation stage.
The offer never materialized into a perfected sale, for no oral or documentary evidence
categorically proves that Al-Amanah expressed amenability to the offered 300,000.00

SM Investments Coproration : written offer to Posadas for a joint venture for the
development of their property into a first class commercial/residential subdivision (70M)
SMI v. Posadas
Posadas sent a counter-proposal for 80M and 80,000.00 goodwill money
SMIC : Accepted the counter-offer and sent the drawings of the proposed mall.
There was a perfected Joint Venture
However, Posadas sent a letter informing SMIC that they had received several other
Agreement between SMIC and
offers and demanded SMIC to make better offers.
Posadas.
Issue : Was there a perfected Joint Venture?
YES.
1) 08 August 1995 embodies a complete offer on the part of SMIC. It contained an
object certain, a specific cuase, and consideration, which are the goodwill money of
70M and 60/40 sharing in favor of Posadas
2) 18 August 1995 letter embodies a complete counter-offer by Posadas where they
conveyed acceptance of the joint venture subject to the counter proporsal of increasing
the goodwill money from 70M to 80M
3) 24 August 1995 letter was a qualified acceptance by SMIC, on the aspect of the
goodwill money
6 December 1995 letter of Posadas may be considered as a mere proposal to amend th
consideration of the joint venture and does not affect the perfected joint venture
agreement.
The increase in the goodwill money was a post perfection matter to appease Posadas
given they they received offers from other parties.

Article 1318 (3 requisites)

Federal Builders v. Power Factors
Contract was perfected once the
elements concurred even if the
Contract of Service was not signed. Issue : Was there a perfected contract between Federal and Power Factors?
Federal is the general contractor for Bullion Mall. It engaged Power Factors Inc. as its
Article 1356 and Article 1357 : contracts shall be obligatory in whatever form they may
subcontractor for the electric works for the Bullion Mall and Precinct Building
have been entered into provided that the requisites for their validity are present
Power demanded payment from Federal Builders
There was a contract between Federal and Power even if the Contract of Service was
Federal : No mutual consent and no meeting of the minds
unsigned. Such contract was obligatory and binding between them by virtue of all the
essential elements for a valid contract being present
Works promised by Power were already executed. Federal made a downpayment.
Both parties only disagreed on the amount of downpayment

Desiderio Dalisay Investments v.

2nd exam case
SSS