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SALES

TOPIC 1

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 therefore a price certain in
money or its equivalent.

A contract of sale may be absolute or conditional.

Contract of Sale Contract to Sell


Absolute Conditional
Real obligation – Personal obligation –
obligation to give obligation to do
Title passes to the Ownership is reserved in
buyer upon delivery the seller and will pass to
the buyer only upon full
payment of the price
Non-payment of the Full payment is a positive
price is a negative suspensive condition, the
resolutory condition failure of which is not a
breach but prevents the
obligation of the vendor to
convey title to arise

I. ELEMENTS OF A CONTRACT OF SALE


1. Consent – Consent to transfer in exchange of price
2. Determinate subject matter
3. Price certain in money or its equivalent

 Notes: A contract of sale is a consensual contract. Absence of any of the essential


elements negates a perfected contract of sale. No particular form is required for validity.

 Consent – meeting of offer and acceptance


 Acceptance – acts or conduct such as payment of price, declaration of property for
taxation purposes, payment of real estate tax
 Determinate – meaning particularly designated or physically segregated.
 Price – can never be left to the decision of one party, except in case when it is accepted
 It is not enough for parties to agree on a price, but also manner of payment for there to be
a binding contract of sale.
 Disagreement of the manner means failure to agree to the price.
 Gross inadequacy of price does not nullify an execution sale 1 where law grants the owner
the right to redeem his property
1
Sps Rabat vs Philippine National Bank Gr No. 158755, June 18, 2012

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II. STAGES IN LIFE OF CONTRACT OF SALE


1. Negotiation – time when parties indicate interest in the contract
2. Perfection – meeting of minds as to object and price
3. Consummation – time when parties execute their undertakings

III. OBLIGATIONS CREATED - 2 sets of real obligations to give

 Notes: Sale is not a mode but a title.

IV. CHARACTERISTICS OF CONTRACT OF


SALE:
1. Nominate
2. Principal
3. Consensual
4. Bilateral
5. Reciprocal
6. Onerous
7. Commutative
8. Title and not a mode

V. DISTINGUISHED FROM OTHER CONTRACTS

Donation Sale
Gratuitous or onerous Onerous
Formal contract Consensual contract
Governed by law on Governed by law on sale
donation

Barter Sale
Consideration: giving of a Consideration: giving of
thing money as payment
Governed by law on sales: species of the genus
sales
If consideration consists party in money
and partly by thing –
look at manifest intention;
If intention is not clear: If intention is not clear:
value of thing is equal or less than amount
value of thing is more than the amount of money of money

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Contract for piece of Sale


work
Goods are to be Contract for delivery of
manufactured specially an article which the
for a customer and upon vendor in the ordinary
special order and not for course of business
the general market manufactures or
procures for general
market (whether on hand
or not)

Lease Sale
Use of thing is for a Obligation to absolutely
specified period only with transfer ownership of
an obligation to return thing

Consideration is rent

Lessor need not be Seller needs to be owner


owner of thing to transfer
ownership

NOTE: Lease with option to buy: really a contract of sale but designated as lease in name
only; it is a sale by installments

OPTION CONTRACT OF SALE


An option is an unaccepted offer. Fixed definitely the relative rights and
It states the terms and conditions on which obligations of both parties at the time of its
the owner is willing to sell the land if the execution
holder elects to accept them within the
time limited. The offer and the acceptance are
If holder does so elect, he must give notice concurrent, since the minds of the
to the other party and the accepted offer contracting parties meet in the terms of the
thereupon becomes a valid and binding agreement.
contract.
If an acceptance is not made within the
time fixed, the owner is no longer bound
by his offer and the option is at an end.

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 Notes:
 Option - also called unaccepted offer. Not itself a purchase but merely secures the
privilege to buy. It is a contract by which the owner of the property agrees with the buyer
that he shall have the right or privilege to buy his property at a fixed price within a certain
time.
 Tests in determining whether it is contract of sale or an option contract? Whether the
agreement could be specifically enforced

EARNEST MONEY OPTION MONEY


1.Part of purchase price 1. Money is a distinct consideration
2.is given only where there is already a sale 2. applies to a sale not yet perfected
3. when earnest money is given, the buyer is 3. when the would be buyer gives option
bound to pay the balance money, he is not required to buy

PARTIES TO A CONTRACT OF SALE

 NOTE: GENERAL RULE - All persons who are authorized in this Code to obligate
themselves may enter into a contract of sale
EXC.
I. MINORS, INSANE AND DEMENTED PERSONS, AND DEAF-MUTES
1. Contracts are voidable, subject to annulment or ratification
2. Also includes:
- State of drunkenness
- Hypnotic spell
- Where necessaries are those sold and delivered to a minor or other person
without capacity to act, he must pay a reasonable price therefore
II. SPOUSES - A spouse may, without the consent of the other spouse, enter into sales
transactions in the regular pursuit of their profession, vocation, or trade

Art. 1490. The husband and the wife cannot sell property to each other, except:
(1) When a separation of property was agreed upon in the marriage settlements; or
(2) When there has been a judicial separation or property under Article 191.

NOTE: Prohibition likewise applies to common-law spouses

III. OTHERS - TRUST RELATIONSHIPS


1. Art. 1491 Two groups of parties prohibited from acquiring by purchase certain
properties:
a. Guardian/Agent/Executors and Administrators
i. Direct or indirect
ii. May be ratified since only private
wrong is involved
b. Public Officers and employees/Officers of the Court
i. Cannot be ratified since public wrong is involved
ii. Requisites for the prohibition to apply to attorneys:

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1. existence of attorney client relationship;


2. property is the subject matter in litigation;
3. while in litigation (from filing of complaint to final judgment)
NOTE: Exception to the prohibition against attorneys: contingent fee arrangement where the
amount of legal fees is based on a value of property involved in litigation

Art. 1492. The prohibitions in the two preceding articles are applicable to sales in legal
redemption, compromises and renunciations.

III. Legal Status of Contract


1. Void (case law) – guardian/ executor/public officers / officers of the court
2. Voidable (civil code) – agent; VALID if with consent

RELATIVELY INCAPACITATED to enter into a contract of sale:


1. Spouses (Art. 1490, NCC)
2. Agents, Guardians, Executors and Administrators, Public Officers and Employees,
3. Court Officers and Employees, such as justices, judges, prosecuting lawyers, and others
specially disqualified by law. (Art. 1491, NCC);
• Note: prohibition applies to lawyers pending suit. Exc, after suit and contingency fee
contract
• Note: Under Art. 1490 of the NCC, spouses cannot sell property to each other, except:
PERSONS SPECIALLY DISQUALIFIED BY LAW TO ENTER INTO CONTRACTS OF
SALE
ALIEN‐UnOS
1. ALIENs who are disqualified to purchase private agricultural lands (Art. XII Secs. 3 & 7)
2. Unpaid seller having a right of lien or having stopped the goods in transitu, is prohibited from
buying the goods either directly or indirectly in the resale of the same at public/private sale
which he may make (Art. 1533 [5]; Art. 1476 [4])
3. The Officer holding the execution or deputy cannot become a purchaser or be interested
directly or indirectly on any purchase at an execution. (Sec. 21 Rule 39, Rules of Court)
4. In Sale by auction, seller cannot bid unless notice has been given that such sale is subject to a
right to bid in behalf of the seller. (Art. 1476)

SUBJECT MATTER OF SALE

1. REQUISITES:
1. Things
a. “Possible” - existing, future, and contingent
i. whether the subject matter is of a type and nature that exists or could be
made to exist to allow the seller reasonable certainty of being able to
comply with his obligations
b. Licit
i. not outside the commerce of man
ii. if illicit, contract is void
c. Determinate or determinable
i. determinate: particularly designated or physically segregated from all
others of the same class
ii. determinable:
1. thing is capable of being made determinate
2. without the necessity of a new further contract

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2. Rights – must be transmissible, except:


a. future inheritance
b. service

Emptio rei speratae Emptio spei


Sale of an expected thing Sale of a mere hope or
expectancy that the thing
will come to existence;
sale of the hope itself
Sale is subject to the Sale is effective even if
condition; that the thing the thing does not come
will exist; if it does not, into existence, unless it is
there is no contract a vain hope
Uncertainty is with regard The uncertainty is with
to the quantity and regard to the existence of
quality of the thing and the thing
not the existence of the
thing
Object is a future thing Object is a present thing
which is the hope or
expectancy
NOTE:
 Quantity of subject matter is not essential for perfection; must determine nature and
quality of subject matter
 Seller need not be the owner of the subject matter at the time of perfection: sufficient that
he is the owner at the time of delivery. Otherwise he shall be liable for warranty against
eviction. exception: foreclosure sale
 Allowed as object of sale. One cannot sell what he doesn’t have or own except:
1. things having potential existence
2. future goods
 Also allowed as object of sale
1. existing goods
2. mere hope or expectancy except when hope is in vain

PRICE

I. REQUISITES for a VALID PRICE


1. Real – MEANING IT MUST NOT SIMULATED otherwise sale is void
a. when at the perfection of the contract of sale, there is every intention on the
buyer to pay the price, and every expectation on the part of the seller to receive
such price as the value of the subject matter he obligates himself to deliver
2. In money or its equivalent
a. consideration for a valid contract of sale can be the price and other valuable
consideration; at the very least, a true contract of sale must have price as part
of its consideration
3. Certain or ascertainable
a. certain: expressed and agreed in terms of specific pesos and/or centavos

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b. ascertainable:
i. by third persons
ii. by the courts – in cases where the third person fixes the price in bad
faith or by mistake
iii. by reference to a definite day, particular exchange or market
iv. by reference to another thing certain

NOTE:
 It is not the act of payment of price that determines the validity of a contract of sale.
Payment of the price has nothing to do into the performance of the contract.
 Failure to pay consideration VS lack of consideration. In the first, such gives rise to
demand fulfillment, while in the other, such prevents the existence of a valid contract.
 Price cannot be left to the will of one of the parties, except when accepted by the other.
 A perfected contract of sale cannot be challenged on the ground of seller’s non-ownership
of the thing sold at the time of the perfection of the contract 2
 Failure to pay price does not BAR transfer ownership. Such only gives vendor option to
rescind sale judicially or by notarial demand.

4. Jurisprudence: Manner of payment must be agreed upon (Marnelego v. Banco


Filipino Savings and Mortgage Bank)– disagreement thereof is failure to agree on the
price
II. EFFECT OF GROSS INADEQUACY OF PRICE

NOTE: Mere inadequacy of the price does not affect the validity of the sale, except (1) When
there is fraud, mistake, or undue influence indicative of a defect in consent is present, (2)When
it shows that the parties really intended a donation or some other act or contract.

III. EFFECT WHERE PRICE IS SIMULATED


1. The act may be shown to have been in reality a donation, or some other act or contract
2. If not and neither party had any intention whatsoever that the amount will be paid
(absolutely simulated): the sale is void
3. If there is a real price but what is stated in the contract is not the one intended to be paid
(only relatively simulated): the contract of sale is valid but subject to reformation

Art. 1474. Where the price cannot be determined in accordance with the preceding articles,
or in any other manner, the contract is inefficacious. However, if the thing or any part
thereof has been delivered to and appropriated by the buyer he must pay a reasonable price
therefore. What is a reasonable price is a question of fact dependent on the circumstances of
each particular case.

FORMATION OF A CONTRACT OF SALE

I. 3 STAGES IN LIFE OF A CONTRACT OF SALE

2
Daus vs Sps De Leon, GR No. 149750, June 16, 2003.

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1. Policitacion (offer or imperfect promise)/Negotiation Stage - offer is floated,


acceptance is floated but they do not meet; the time when parties indicate
their interest but no concurrence of offer and acceptance.
2. Perfection - concurrence of all requisites; meeting of the minds.
3. Consummation – parties perform their respective undertakings
Notes:
 ownership of the thing sold shall be transferred to the vendee upon the actual
or constructive delivery thereof
 execution of a contract of sale is constructive delivery

CONTRACT TO SELL vs CONDITIONAL CONTRACT OF SALE

CONTRACT TO SELL CONDITIONAL CONTRACT OF


SALE
Seller, who expressly reserves ownership of If suspensive condition is not fulfilled,
property despite DELIVERY thereof, binds perfection of sale is abated.
himself to sell property to the buyer upon
fulfilment of the condition, which is FULL If suspensive condition is fulfilled, title of
PAYMENT of price. property where was previous delivery, is
automatically transferred to the BUYER
If suspensive condition is fulfilled, title of without need of any further act by the
the property, despited delivery, is not SELLER.
automatically transferred to the BUYER
unless SELLER executes a contract of If there is a 3rd person buyer, his right is
absolute sale. defeated by the original prospective buyer.

If there is a 3rd person buyer, he cannot be


deemed buyer in bad faith. There is no
double sale.

 OPTION CONTRACT - a contract granting an exclusive right in one person, for which
he has paid a separate consideration, to buy a certain object within an agreed period
1. no presumption of consideration, needs to be proven
2. characteristics of Option Contract:
a. not the contract of sale by itself, separate and distinct
b. nominate
c. principal; but can be attached to other principal contracts
d. onerous
e. commutative
f. unilateral – versus contract of sale which is bilateral

San Miguel Philippines v Cojuangco consideration in an option contract may be anything of


value, unlike in sale where it must be price certain in money

3. how exercised: notice of acceptance should be communicated to offeror without


actual payment as long as there is delivery of payment in consummation stage

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4. SITUATIONS IN AN OPTION CONTRACT:


a. with separate consideration
i. option contract is valid
ii. offeror can not withdraw offer until after expiry period
iii. subject to rescission, damages but not to specific performance
because this is not an obligation to give
b. without separate consideration
i. OLD RULE - offer is still valid, but option contract is void and not
subject to rescission, damages
ii. NEW RULE: Right of first refusal recognized

Right of First
Option Contract Refusal
Principal contract; Accessory; can not
stands on its own stand on its own
Does not need
Needs separate separate
consideration consideration
Subject matter and There must be subject
price must be valid matter but price not
important
Not conditional Conditional
Not subject to
specific Subject to specific
performance performance

 Notes: also in option contract, offeree is granted an option for a fixed period and at a
determinate price. Lacking these, there is only right of first refusal.
 Notes: a unilateral promise to buy or sell, even if accepted by optionee, is not binding
unless there is a consideration distinct from the price. Without consideration, option can
still be withdrawn. The consideration need not be monetary as long as it is something of
value. Actual cash need not be exchanged for option. It may be any thing or undertaking
of value. This is what happens to a Contract of Lease with option to purchase, where
lessee cannot enforce his option to buy unless there is a consideration. 3
 Notes: remedy of optionee-offeree is there was consideration is SPECIFIC
PERFORMANCE. In case optioner-offeror breaches a perfected option contract, he is
liable for damages.
 Note: Option money or consideration should at least be given by optionee.

 RIGHT OF FIRST REFUSAL:

3
See page 33. Sales and Agency by Atty. Andrix D. Domingo 2017 Edition

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1. creates a promise to enter into a contract of sale and it has no separate


consideration, not subject to specific performance because there is no
contractual relationship here and it is not an obligation to give (not a real contract)
2. New doctrine: may be subject to specific performance.

Equatorial realty Dev’t Inc. v Mayfair Theater, the right of first refusal is only subject to
specific performance insofar as it is attached to a valid written principal contract (e.g. lease)
RFR becomes one of the considerations in the contract.]

3. Effect of new doctrine: turned the world of policitacion upside down because while
valid option contract is not subject to specific performance, right of first refusal which
does not even have a separate consideration may be subject to specific performance

4. Recognizes recovery of damage based on abuse of rights doctrine

CH. 6 - PERFECTION OF SALE

GENERAL RULE: A contract of sale is perfected at the moment there is a meeting of the
minds upon the thing which is the object of the contract and upon the price; consensual
contract
Exception: When the sale is subject to a suspensive condition

I. REQUIREMENTS:
1. When parties are face to face – when there is absolute acceptance of an offer that is
certain
2. When thru correspondence or telegram – when the offeror receives or had
knowledge of the acceptance
3. When the sale is subject to a suspensive condition – from the moment the condition is
fulfilled
 NOTES: Qualified acceptance: mere counter-offer which needs to be absolutely
accepted to give rise to perfected contract of sale. Business ads are mere invitations to
make an offer except when it appears to be otherwise
II. RULES GOVERNING AUCTION SALES:
1. Sales of separate lots by auction are separate contracts of sale
2. Sale is perfected by the fall of the hammer
3. Seller has the right to bid at the auction provided such right was reserved and notice
was given to that effect

III. EARNEST MONEY (“arras”)


1. Money given as part of purchase price
2. Acceptance is the proof that contract of sale exists
3. Nothing in law prevents parties from treating earnest money differently

4. Old concept: subject to forfeiture when BUYER backs out

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5. New concept: can not be forfeited – part of purchase price; must be


restored
6. Qualification: if old concept is stipulated –
VALID
7. Presumption of perfection of contract of sale and such earnest money as part of
purchase price is disputable

OPTION MONEY EARNEST MONEY


Money given Part of the purchase
as distinct price
consideration for an
option contract
Applies to a sale not Given only when
perfected there is already a
sale
Not required to buy When given, buyer is
bound to pay the
balance

Notes: It is true that Article 1482 of the Civil Code provides that "Whenever earnest money is
given in a contract of sale, it shall be considered as part of the price and proof of the perfection
of the contract." However, this article speaks of earnest money given in a contract of sale. In this
case, the earnest money was given in a contract to sell. The earnest money forms part of the
consideration only if the sale is consummated upon full payment of the purchase price. Now,
since the earnest money was given in a contract to sell, Article 1482, which speaks of a contract
of sale, does not apply. 4

Art. 1483. Subject to the provisions of the Statute of Frauds and of any other
applicable statute, a contract of sale may be made in writing, or by word of mouth, or partly
in writing and partly by word of mouth, or may be inferred from the conduct of the parties.
(n)

FORM OF SALES

I. Form not important in validity of sale


a. Sale being consensual, may be oral or written, perfected by mere consent as to
price and subject matter
b. If particular form is required under the statute of frauds:
i. valid and binding between parties but not binding to 3rd persons
c. Reason: purposes of convenience only and not for validity and enforceability; cause of
action is granted to sue and compel other party to execute the document

II. When form is important for validity; exception by specific provision of law;
a. Power to sell a piece of land granted to an agent – otherwise VOID
b. Sale of large cattle; must also be registered with Municipal treasurer – otherwise
VOID
4
Serrano and Herrera vs Caguiat GR No. 139173, Feb. 28, 2007.

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c. Sale of land by non-Christian if not approved by Governor– VOID

III. When form is important for enforceability (STATUTE OF FRAUDS Article 1403
(2))
a. A sale agreement which by its terms is not to be performed within a year from the
making
Thereof;
b. An agreement for the sale of goods,. chattels or things in action, at a price not less than
P500.00; and
c. A sale of real property or of an interest therein.
IV. EXCEPTIONS TO COVERAGE OF
STATUTE IN SALES CONTRACTS:
1. When there is a note or memorandum in writing and subscribed to by party or his
agent (contains essential terms of the contract)
2. When there has been partial performance/execution (seller delivers with intent to
transfer title/receives price)
3. When there has been failure to object to presentation of evidence (oral)
4. When sales are effected through electronic commerce

CONSUMMATION STAGE/PERFORMANCE STAGE


 NOTE: Stage where parties both comply with their obligation. Nature of diligence
required: diligence of a good father of the family unless other requirement is stipulated.
Consequence: Seller will be guilty of breach if thing is lost through his fault

CONDITION and WARRANTIES


See Articles 1545-1547

I. Condition
1. When a contract contains a condition, the non happening of which would not constitute
a breach but extinguishes the obligation
2. However, if party to the sales contract has promised that the condition should happen or
be performed, the non-performance of which may be treated by parties as breach

II. Warranties
A statement or representation made by the seller contemporaneously and as a part of the
contract of sale, having reference tot eh character, quality, or title of the goods, and by
which he promises or undertakes to insure that certain facts are or shall be as he then
represents. May either be express or implied.

Q: What is the effect of a breach of warranty?


Buyer may:
1. Refuse to proceed with the contract; or
2. Proceed with the contract; waive the condition.

 Note: If the condition is in the nature that it should happen (positive conditions), the
non‐performance may be treated as a breach of warranty.

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A. EXPRESS WARRANTIES

Q: What are express warranties?


A: Any affirmation of fact or any promise by the seller relating to the thing if the natural
tendency of such affirmation or promise is to induce the buyer to purchase the same, and if the
buyer purchases the thing relying thereon. (Art. 1546)

Q: What are the requisites of EXPRESS warranties?


A: AIR
1. It must be an Affirmation of fact relating to the subject matter of sale
2. Natural tendency is to Induce buyer to purchase subject matter
3. Buyer purchases the subject matter Relying thereon

Q: What is the liability of the seller for breach of express warranties?


A: The seller is liable for damages.

B. IMPLIED WARRANTIES

Warranties deemed included in all contracts of sale by operation of law. (Art. 1547)
The ff are implied warranties:

1. Warranty that seller has right to sell – refers to consummation stage. Not applicable to sheriff,
auctioneer, mortgagee, pledge

2. Warranty against eviction


Requisites for Warranty Against Eviction
Requisites: JPENS
a. Buyer is Evicted in whole or in part from the subject matter of sale
b. Final Judgment
c. Basis of eviction is a right Prior to sale or act imputable to seller
d. Seller has been Summoned in the suit for eviction at the instance of buyer; or made 3rd
party defendant through 3rd party complaint brought by buyer
e. No waiver on the part of the buyer

 Note: For eviction – disturbance in law is required and not just trespass in fact.

3. Warranty against encumbrances (non-apparent)


Requisites:
a. immovable sold is encumbered with non‐apparent burden or servitude not mentioned in
the agreement
b. nature of non‐apparent servitude or burden is such that it must be presumed that the buyer
would not have acquired it had he been aware thereof
 XPN: warranty not applicable when non‐apparent burden or servitude is recorded in the
Registry of Property – unless there is expressed warranty that the thing is free from all
burdens & encumbrances

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4. Warranty against Hidden Defects


Requisites: HENNAS
a. Defect is important or Serious

 The thing sold is unfit for the use which it is intended


 Diminishes its fitness for such use or to such an extent that the buyer would not have
acquired it had he been aware thereof

b. Defect is Hidden

c. Defect Exists at the time of the sale

d. Buyer gives Notice of the defect to the seller within reasonable time

e. Action for rescission or reduction of the price is brought within the proper period
 6 months – from delivery of the thing sold
 Within 40 days – from the delivery in case of animals

f. There must be No waiver of warranty on the part of the buyer.

remedies of the buyer in case of


sale of things with hidden defects

The vendee may elect between:


1. Withdrawing from the contract, or
2. Demanding a proportionate reduction of the price, with damages in either case.

Q: Is there a waiver of warranty against hidden defects when the lessee inspected the premises
and pushed through with the contract?

A: Yes. Under Arts. 1561 and 1653 of the Civil Code, the lessor is responsible for warranty
against hidden defects, but he is not answerable for patent defects or those, which are visible

Q: When is implied warranty not applicable?


A: ASAP
1. “As is and where is” sale
2. Sale of second hand articles
3. Sale by virtue of authority in fact or law
4. Sale at public auction for tax delinquency

Q: What are the effects of waiver of an implied warranty?


1. Seller in bad faith & there is waiver against eviction –void
2. When buyer w/o knowledge of a particular risk, made general renunciation of warranty –
is not a waiver but merely limits liability of seller in case of eviction
3. When buyer with knowledge of risk of eviction assumed its consequences & made a

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waiver – seller not liable (applicable only to waiver of warranty against


eviction)

IMPLIED WARRANTIES IN CASE OF SALE OF GOODS


Q: What are the specific implied warranties in sale of goods?
A:
1. Warranty of fitness
 GR: No implied warranty
 XPN:
a. Buyer manifests to the seller the particular purpose for which the goods are required;
and
b. Buyer relies upon the seller’s skill or judgment

2. Warranty of merchantability – That goods are reasonably fit for the general purpose for
which they are sold.

CAVEAT EMPTOR, principle


It literally means, ‘Let the buyer beware’.
 The rule requires the purchaser to be aware of the supposed title of the vendor and one
who buys without checking the vendor’s title takes all the risks and losses consequent to
such failure.

Q: In what particular sale transactions does caveat emptor apply?


1. Sales of animals (Art. 1574)
2. Double sales (Art. 1544)
3. In sheriff’s sales (Art. 1570)
4. Tax sales (Art. 1547, last paragraph)

remedies of the buyer in case of


breach of warranty

1. Accept goods & set up breach of warranty by way of recoupment in diminution or extinction
or the price.
2. Accept goods & maintain action against seller for damages
3. Refuse to accept goods & maintain action against seller for damages
4. Rescind contract of sale & refuse to receive goods/return them when already received.

Q: Are the remedies of the buyer in case of breach of warranty absolute?

A: No. The vendee's remedies against a vendor with respect to the warranties against hidden
defects of or encumbrances upon the thing sold are not limited to those prescribed in Article
1567 where the vendee, in the case of Arts. 1561, 1562, 1564, 1565 and 1566, may elect either
to withdraw from the contract or demand a proportionate reduction of the price, with damages in
either case. The vendee may also ask for the annulment of the contract upon proof of error or
fraud, in which case the ordinary rule on obligations shall be applicable.

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