The Fisher Valley College, Inc.

LAW on SALES
Preliminary Examination

Instructions: This exam is designed to overcome problems with the internet connections due to
the undergoing maintenance. Answer this AT HOME and submit your answers through
electronic mail at jamado@tfvc.edu.oh on or before the day of our next class session.

Elaborate and/or explain even when the item does not ask you to do so. No corresponding
points shall be given on a mere enumeration or copy paste from books or internet.

1. Dissect Article 1458 of the Civil Code.

2. The characteristics of a contract of sale.

3. The essential elements of a contract of sale.

4. When is there a meeting of minds?

5. What is/are the effect(s) of absence/non-payment of price?

6. Kinds of contract of sale.

7. Contract of Sale vs. Contract to Sell vs. Barter vs. Contract of Agency

8. Article 1463 of the Civil Code

9. Bert offers to buy Simeon’s property under the following terms and conditions: P1 million
purchase price, 10% option money, the balance payable in cash upon the clearance of the
property of all illegal occupants. The option money is promptly paid and Simeon clears the
property of illegal occupants in no time at all. However, when Bert tenders payment of the
balance and ask Simeon for the deed for absolute sale, Simeon suddenly has a change of heart,
claiming that the deal is disadvantageous to him as he has found out that the property can
fetch three time the agreed purchase price. Bert seeks specific performance but Simeon
contends that he has merely given Bert an option to buy and nothing more, and offers to return
the option money which Bert refuses to accept. May Simeon justify his refusal to proceed with
the sale by the fact that the deal is financially disadvantageous to him? Explain.

10. D sold a second-hand car to E for P150,000.00. The agreement between D and E was that
half of the purchase price, or P75,000.00 shall be paid in five equal monthly instalments of
P15,000.00 each. That car was delivered to E, and E paid the amount of P75,000.00 to D. Less
than one month thereafter, the car was stolen from E’s garage with no fault on E’s art and was
never recovered. Is E legally bound to pay the said unpaid balance of P75,000.00? Explain your
answer.