(As of 09/29/19) This is exactly what I have 3.

E e ia Cha ac e i ic f Sa e
indicated it to be: a memory aid, which I based from (NP, C, BR, OC, TnM)
the CLV outline + CLV s book on Law of Sales and (1) Nominate1;
annotations as well as the discussions of Atty.
(2) Principal2;
Cajucom, and formatted for easier memorization and
recall. All for love.
(3) Consensual3;
BB (4) Bilateral4;
(5) Reciprocal5;
(6) Onerous6;
(7) Commutative7; and
SALES (8) Title and not mode8.

● Once there is a meeting of the minds as to

I. CONTRACT OF SALE
the price, the sale is valid, despi e he manner
of i s ac al pa men , or e en hen here has
A. DEFINITION AND ESSENCE OF SALE (Art. been breach hereof. If the real price is not
1458) stated in the contract, then the sale is valid
but subject to reformation; if there is no
A contract whereby: meeting of the minds as to the price,
SELLER BUYER because the price stipulated is simulated,
then the contract is void (See B ena en ra .
1. To transfer 1. To pay a price Co r of Appeals).
ownership; and certain in money or
2. To deliver a its equivalent 1
It is gi e a a ic a a e b a and is governed
determinate thing by the rules in the Civil Code - Law on Sales."
2
It can stand on its own, and d e de e d
a he c ac f i a idi e i e ce.
● Real obligations; Can be the proper subject 3
It is e fec ed b e e c e , a he momen here
for speci c performance (See Ar . 1480). is a mee ing of he minds pon he hing hich is he
objec of he con rac and pon he price (Art. 1475).
1. E e e f a Sa e
4
It embodies reciprocal obligations, i i g
b iga i b h a ie he e a i hi , and
(1) Consent;
whereby he obliga ion or promise of each par is he
(2) Object/Subject matter; and ca se or considera ion for he obliga ion or promise of
(3) Consideration he o her.
5
The ega effec a d c e e ce of such: 1) he
2. S age f he C ac f Sa e po er o re cind i implied (Art. 1191); 2) Nei her
(PPC) par inc r dela if he o her par doe no compl , or
(1) Policitation i no read o compl in a proper manner, i h ha i
● The period from the time the inc mben pon him (Art. 1168) thus, from he
prospective contracting indicate their momen one of he par ie f l ll hi obliga ion, he
interests in the contract to the time it defa l b he o her begin , i ho he need of prior
demand.
is perfected. 6
It i e a a ab e c ide a i a a e a i ,
(2) Perfection which ideally is a price certain in money or its
● Upon the concurrence of the essential equivalent.
elements of the sale 7
A thing of value is exchanged for equal value, i.e.,
(3) Consummation ideally the value of the subject matter is equivalent
● When the parties perform their to the price paid. So as long as he par belie es in
respective undertaking under the all hones ha s/he is recei ing good al e for ha
contract of sale and culminates in the he ransferred, hen i complies i h he comm a i e
charac er of a sale. BUT, i canno and sho ld no be
extinguishment
p shed o abs rdi .
8
Sa e b i e f d e a fe affec e hi ;
he ha a e d e i c ea e he b iga i
a fe e hi ; i i adi i de i e , a a
c e e ce f a e, ha ac a a fe
e hi .

Billie Blanco (2E) | Ateneo Law 2022 | 1

● F c a , a .11 a .
a a c ca d a d
a c , a a CONTRACT Ma ac Ma ac
a d a FOR A ca a c
c a (S A . 1475). PIECE OF b
● T b d c a d d a WORK12 c
a ba d c a
AGENCY TO A B a
b a a a c SELL13 b a c
a b . c ,a d b c.
bliged
GENERAL RULE: M ad ac c deli e he
a d a c a d a ice hich he
(S A . 1355). a ecei e f
EXCEPTIONS: W a a d c he b e .
c , . ., a a d, a ,
A B , af e
d c a d dad a b c deli e , b c
ac c ac (S A . 1355 a d
1470). b c b c a .

B. SALE AS DISTINGUISHED FROM SIMILAR 11

RULES IN CASES OF DISPUTE IF SALE OR BARTER
CONTRACTS
(S A . 1468):
DONATION9 A a A 1) Ma I Pa . - E
c ac , . ., a c ac . ac a ad b a b c
ac b a a a a c , a
(S A . 725). S b a a a d a ba , c a
a ;
M c P c d b 2) W I D N A a a
A c . C a C Pa M a Pa
a A T :
a da d b (1) I a ba , a
a . L a a c d a c d a
a ;
BARTER10 O O a ( )I a a , a a
a b d E b d a c d a a a
a a .
c d a 12
T ca d d A c 1467
c d a C C d , ab , b
d a a ac a b da a
c b da d d c b ad . W a
a a b a a
c a a c
a ac , a d d
a a , b
b a a ac (S C &C . .C c ).

T a d ac b a a a da
c ac a c - - c
a : c b c,
c a c ,
c ac a ; c c ,
d a
c a ac b c, c ac
9
W c a a a , a c , c a a
a b , b he ac a be h ha e bee c ab .
i eali a d a i e he ac c ac (S 13
I c a c ac c a
A . 1471). c a ac c b a a c ac
10
I a b d b La Sa (A . a c , a ca
1641) a b c d d (S A . 1466).
B B a c (2E) A La 2022 2
 the agency, e en II. PARTIES TO A CONTRACT OF SALE
if the object is
deli ered to him.
GENERAL RULE: Any person who has the
Agent who Seller warrants. capacity to act or juridical capacity14 may enter
effects the sale into a contract of sale, whether as seller or as
assumes no buyer.
personal
liability as long
EXCEPTIONS:
as he acts
within his
1. M , I a e De e ed Pe , a d
authority and in Dea -M e15
the name of the MINORS When the minor
principal.
actively
Revocable. Not unilaterally
misrepresented his
revocable. age on the contract
by stating that s/he
DATION EN One whereby is of age, and the
PAGO property is other party was
alienated to the misled (See Me cad
creditor in full .E ).
satisfaction of a
debt in money
INSANE OR When entered into
(See A . 1245).
DEMENTED during lucid
Not in the PERSONS intervals.
realm of
e ec DEAF-MUTES When s/he knows
c ac , b how to write.
e
c a . [DRUNK AND When s/he is still
HYPNOTIC SPELL] fully aware of what
LEASE The leessor s/he is doing and
binds himself knows the
e a e
consequences
e e e
e a thereof.
for a price
certain, and for
a period which
may be See A . 37 [Capacity to act and Juridical Capacity],
14

de nition or 38 [Restrictions on Capacity to Act] and 39

inde nite. [Modi cations on Capacity to Act].

RESTRICTIONS ON CAPACITY TO ACT:

(MID-PC)
1. Minority;
2. Insanity or Imbecility;
3. Deaf-mute;
4. Prodigality; and
5. Civil Interdiction

MODIFICATIONS ON CAPACITY TO ACT:

(FIIT-PP-AAA-D)
1. Family relations; 2. Insanity or Imbecility; 3.
Insolvency; 4. Trusteeship; 5. Penality; 6. Prodigality;
7. Age; 8. Alienage; 9. Absence; and 10. Deaf-mute
15
Contracts entered into by such incapacitated
persons are NOT VOID, BUT ARE VOIDABLE, b ec
a e a ca .
Billie Blanco (2E) Ateneo Law 2022 3
 ● The  ad i i a i a d e j e f he
When  entered  into 
c i e he c j ga
during  lucid 
e , as the case may be, shall be g
intervals.  
b h e j i ;  and  in  case  of 
  disagreement,  the  husband’s  decision 
(a)  Nece a ie .16 -  Where  ece a e are  shall  prevail,  subject  to  the  wife  seeking 
sold  and  delivered  to  a  minor  or  other  remedy  from  the  courts,  which  must  be 
person  without  capacity  to act, he must pay  availed  of  within  5  years  from  the date of 
reasonable  price  therefor;  and  the resulting  the  contract.  In  addition,  the  disposition 
sale is VALID (Art. 1489).  or encumbrance of community property or 
  conjugal  property,  as  the  case  may  be, 
(b)  P ec i f he Se i e a d E de . - In  shall  be  void  without  authority  of  the 
all  contractual,  property  or  other  relations,  court  or  the  written  consent  of  the  other 
when  one  of  the  parties  is  at  a  spouse (Arts. 96 and 124). 
disadvantage  acc f h a  
de e de ce, g a ce, e a ea e , (b)  Sa e Be ee S e .  -  Article  133  of 
e de age he ha d ca ,  the  courts  the  Civil  Code  declares  void  every  donation 
must be vigilant for his protection (Art. 24).  between  spouses  during  marriage.  This, 
  however,  has  been  replaced  by  Article  87  of 
● The  rule  is  that  a  person  is  not  incompetent  the  Family  Code  which  added  the  provision 
to  contract  merely  because  of  advanced  [t]he  prohibition  shall  also  a e
years  or  by  reason  of  physical  in   rmities.  i i g ge he a h ba d a d ife i h
However,  when  such  age  or  in   rmities  have  a a id a iage.   (See  Ma ab e a .
impaired  the  mental  faculties  so  as  to  Ce a e )
prevent  the  person  from  properly,  ● Spouses  cannot  sell  property  to  each 
intelligently,  and  rmly  protecting  her  other, except:  
property  rights  then  s/he  is  undeniably  (a)  when  a  separation  of  property  was 
incapacitated (See D g . CA).  agreed  upon  in  the  marriage 
  settlements; or  
(c)  I i e a e . -  Where  by  one  of  the  parties  (b)  when there has been a judicial decree 
is  ab e ead, or  f c ac a for the separation of property (Art. 1490). 
a g age de d b h ,  and  mistake   
or  fraud  is  alleged,  the  person  enforcing  the  3. S eci c I ca aci ie Ma da ed b La ;
contract  must  show  that  the  terms  have  Pe Re a i e Di a i ed (Arts. 1491)17
been  fully  explained  to  the  former  (Art.  (AGE-PJL) 
1332).  (1) Agent, with respect to the property whose 
  administration  or  sale  may  have  been 
2. Sa e B a d Be ee S e entrusted to him, e he c e f he
(a)  Sa e i h Thi d Pa ie . -  Either  spouse  c a ha bee g e ; 
may  (2)  Guardian,  with  respect  to  the  property  of 
exercise  any  legitimate  profession,  the person who is under his guardianship; 
occupation,  business,  or  activity  without  the  (3)  Executor  or  administrator,  with  respect  to 
consent  of  the  other;  and  the  latter  may  the  property  of  the  estate  under  his 
object  only  on  valid,  serious  and  moral  administrations;18 
grounds (Art. 73).  (4)  Public  of cers  and  employees,  with 
● The  courts  shall  decide  whether  the  respect  to  property  of  the  State  or  any 
object  is  proper  and  make  rulings  on  the  subdivision  thereof,  or  of  any 
dene t,  depending  on  whether  bene ts  government-owned  or  controlled  corporation, 
had  accrued  to  the  family  prior  to  the  or  institution, the administration of which has 
objection or thereafter. 
17
This  is  applicable  to  a e ega ede ,
c e ,a d e ca (Art. 1491).
These  cover  everything  indispensable  for 
16 18
He edi a igh ae i c ded i he
sustenance,  dwelling,  clothing,  and  medical  hibi i   insofar  as  the  administrator  or  executor 
attendance and educational books and materials.  of the estate of the deceased. 
Billie Blanco (2E) | Ateneo Law 2022 | 4
 b d ; c d d
Ma b .23
a d , a a
a , a a a ; RIGHT/S Ta b .
( ) J c , d , c a ,
c c , a d c a d Ma b .
c c d ad a
c , c a d SERVICE/S N c a a ,
a d a a , d
c b c c ,
dc c b c d ,
c c ;a d b c c.
( ) La , c a d
c a b b c a 24
GENERAL RULE: W a c a
a c a a a b
, ca b a b c a
.19 25
c ac .
EXCEPTIONS:
(1) I ca a a ;a d
III. SUBJECT MATTER OF SALE (2) I ca a
ad b d c a d ,a
REQUISITES FOR A VALID SUBJECT MATTER: a a d.
(PLD)
(1) P b 20; I b T S c . - Ca b
(2) L c ; a d b c c ac (S A . 1348).
(3) D a D ab . ● O Pa ial I ibili /P ibili : T
c b d d
1. S b c Ma M B E i i g, F e, a d d b c .
C i ge ○ I d b , b a
b a d a d b a b
OBJECT OF CONTRACTS21 (A . 1347) d.
○ I d b b a a
THING/S W c c b a , c ac
a .22 d b ca a a a c

23
A , a E R S aa . T
d d E S , a
a d ca c. T c a a
b a a c ac b a
aa a A c 1461: a a a a
ca c ,a
P
19
b a 1) a a b b c a a c a
ac d c a a b b c a .
d a c c ; 2) a a a d ac db 24
A c d b da b a a
c a a d a a b c a a a a a ac
a ; a d 3) c c a a .I a .T a d a
ac c a a , a a c a c ac a
a c a b a , a a ac d
b a a b d a a d c
ca a b a (S Fab . IAC). a abd ca
20
I b , a a c , a a a
, c b c a d c a d
c (S A . 1462). , a c - .
21
I ca b a , , c a a 25
T a a a a c a
c ac . c a c c a a
22
W a a a a a a d a d c .I a ca
c a c db a .I d , ac b d d a
ca b b c a a . a d c a d.
B B a c (2E) A La 2022 5
 indivisible  obligation is equivalent to  UNLAWFUL/FORBIDDEN CAUSE, NOT A
non-performance.  CONSTITUTIVE OF A CRIME (Art. 1412) 
● O Dif c f Pe f a ce:  Mere  Rules: 
dif culty or great inconvenience is  an  (1) If  both parties are in pari delicto,  they 
impossibility.  cannot  recover  what  they  had  given 
  under  the  contract;  moreover,  they 
E isting Goods.26 -  The  thing  may be  cannot  demand  the  performance  of  the 
- at  the  time  of  perfection  of  the  undertaking  or  promise  of  the  other 
contract of sale.   party. 
● Article  1461  of  the  Civil  Code  explicitly  (2) If  onl one of the contracting parties  is 
states  that  “[t]hings  having  a  potential  at  fault,  the  one  at  fault  cannot  recover 
existence  may  be  the  object  of  the  what  he  has  given  under  the  contract; 
contract of sale.”  further,  he  cannot  demand  the 
● In  addition,  the  second  paragraph  of  ful llment  of  the  promise  of  the  other. 
Article  1462  provides  that  “[t]here  may  On  the  other  hand,  the  one  who  is  not 
be  a  contract  of  sale  of  goods,  whose  at  fault, may demand the return of what 
acquisition  by  the  seller  depends  upon  he  has  given  without  any  obligation  to 
a  contingency  which  may  or  may  not  comply  with  his  promise or undertaking 
happen  [or,  ]”  which  clearly  to the other. 
shows  that  a  valid  contract  of  sale  may   
exist  even  if  at  the  time  of  its  ● The  sale  of  animals  suffering  from 
perfection,  the  seller  was  not  even  the  contagious  diseases,  and  those  which 
owner of the thing sold.  are  un t  for the use or service for which 
● Article  1465  provides  that  the  subject  they  are  acquired  as  stated  in  the 
matter  of  a  sale  may  be  b c a contract is void (Art. 1575). 
c .  
  SALES DECLARED ILLEGAL BY LAW 
2. Subject Matter Must Be Lici (See A . 1459)27 (1) Where subject matter is prohibited;
  e.g.,  narcotics;  wild  birds  or  mammals  rare 
ILLEGALITY OF CAUSE (Art. 1411)  wild  plants;  poisonous  plants  or  fruits; 
● If  a  contract  is  oid because  of  the  dynamited  sh  gunpowder  and  explosives; 
nullity  of  the  cause  or  object  and  it  rearms  and  ammunitions;  and  sale  of  realty 
happens that the transaction constitutes  by non-Christians. 
a  criminal  offense, both parties are in (2)  Sale of friar land,  without  the  consent  of 
pari delicto,  he ha ha e ca e f the  Secretary  of  Agriculture  under  Act  No. 
ac i agai each he . 1120  (See A .C b C C b, I c. and 
● The  rule  is  that,  where  only  one  of  the  La .C A a ); and 
parties  is  guilty,  the  innocent  one  may  (3)  Alien who  purchased  land and  placed  the 
claim  what  he  has  given  and  shall  not  deed  of  sale  in  the  name  of  his  Filipina  lover 
be bound to comply with his promise.  (See F . Ca ). 
   
  3. Subject Matter Must Be De e i a e or at
  least De e i ab e 
 
Determinate Subject Matter. -  A  thing  is 
26
What  must  be  considered  is  whether  the  subject 
matter  is  of  a  type  and  nature,  taking  into 
determinate  or  speci c  when  it  is  particularly 
consideration  the  state  of  technology and science at  designated  or  physically  segregated  from  all 
the  time  the  sale  is  perfected,  that  it exists or could  others of the same class (Art. 1460).28 
be  made  to  exist  to  allow  the  seller  reasonable 
certainty  of  being  able  to  comply  with  his  28
The  basis  upon  which  the  enforce seller s
obligations under the contract.  obligation to deli er  and  basis  upon  which  to 
27
Under  Art. 1409, contracts where the “cause, object  demonstrate  breach are  certain  and  unequivocable. 
or  purpose  is  contrary  to  law, morals, good customs,  The defense of force majeure is applicable to legally 
public  order  or  public policy” - otherwise put,  c -  relieve the seller from the consequences of failure to 
are inexistent or void.  deliver the subject matter of the sale. 
Billie Blanco (2E) | Ateneo Law 2022 | 6
De e minable29 S bjec Ma e .30 - O 2
:
(1) A , ,
;
; ,
(2) W
. ,
.
● T
, , SALE OF UNDI IDED INTEREST (A . 1463)
● T ole o ne
31
; ,
-
. .

QUANTIT OF SUBJECT MATTER, NOT ESSENTIAL SALE OF UNDI IDED SHARE IN MASS (A . 1464)
FOR PERFECTION ● B ,
● T mee ing of mind -
,
,
, .
● I le han he
n mbe , eigh , o mea e bo gh ,
.
● T objec
de e mina e a oi kind. T
,
.
,
, SALE OF MORTGAGED PROPERT (S P .
(S C A )
A . 1459).32 ● A
● A ale
alid, ,

29
A ,

. .
RULE IN DELIVERING INDETERMINATE OR GENERIC
30

THINGS (S A . 1246): 4. Selle Obliga ion o T an fe Ti le o B e

When he q ali and ci c m ance ha e no been GENERAL RULE: A pe fec ed con ac of ale
a ed. - C
. N
a he ime
.
31
C in en ion
of e fec ion; a deli e

canno be a ce ained INEXISTENT VOID (S A -D . D L

(A . 1409 (6)). A . 1459)
32
E e ac q an i of he bjec ma e ● BUT,
no been ag eed pon, .T
g eemen
a o he ali he eof and he ice, and e m of
a men ,
.
.
B B (2E) A L 2022 7
EXCEPTION: J S .33
(S
● A 1505 C C B e . AFP Re e e a d Se a a
Be e S e ).
,
REQUISITES FOR VALID PRICE
, (RMC)
(1) R ;
. (2) I M E ( , a ab e
c de a );
SUBSEQUENT ACQUISITION OF TITLE BY SELLER (3) C A .
● W ,
1. P ice M Be Real (A . 1471)35
, ( ) Whe P ice i Si a ed
a ida e ● I i e
he a e a d i e a e he b e b
eai f a , provided  there  has  , it  is  a 
been  previous  delivery  of  the  subject  wholly  simulated  price,  and  the 
matter by the seller to the buyer.   underlying  contract  of  sale is void for lack 
of consideration. 
○ W
,
IV. PRICE AND OTHER CONSIDERATION34
a de c a ac
,
P ice. - T i a ed a he e i a e f .
he hi g d every  incident taken into  ○ BUT,
consideration  for  the  xing of the price 
(S
I c a &C . .C e ). ,
● A

, , .

( ) Whe P ice i Fa e
(S G e e Se ce I a ce . ● P a ea ice
C f A ea ). I , hich he i d f he a ie had
e, b dec a ed,
not  the 
one intended to be paid. 
33
S Ca e De e e Ba .S e C L .I ● I
, ,
, ,
A 1458 C C , ef a
, ,
.
, ,
. B
, GENERAL RULE: T
. (A . 1353).
34
B A 1458, idea EXCEPTION: I
c ide a i   “price” 
as  a  “sum  certain  in  money  or its equivalent.” I T e 35
P ea a he e fec i f he a e,
. C f A ea , [ ] , he e i ega i e i
ca e, , ,

. .
B B (2E) A L 2022 8
con ac a fo nded pon ano he ca e a a a a .
hich i e and la f l.36
38 39
3. P ice M Be C a o A a ab a
( ) Effec of Non-Pa men of P ice. - T P
a a a a a
a a ,
PRICE FIXED BY (a) I a
a .I a a
THIRD PARTY40 a
a a , BUT
bad fai h o
a a
b mi ake,
a a
a
a a .
a a
● Fa a
a a
.
a a a a
a b a
(b) I a
a a ,
a
a a
p e en ed f om
.
ing he p ice b
● I a a a , - a
a
a e ol o condi ion
b ,
a a a,
he pa no a fa l
a , a a
ma ha e ch
b a a (S He
emedie a a
f Ped E ca a . C f A ea ).
a a a ae
allo ed
2. P ice M Be M E a
he elle o he
● A 1458 C C ,
b e.
b a b ,
a a REFERENCE TO A DEFINITE DAY, PARTICULAR
a a .37 EXCHANGE, OR MARKET41
● I a a
a , a a REFERENCE TO OTHER THINGS CERTAIN
a , an ac ion can ill
be con ide ed a con ac of ale 42
GENERAL RULE: P a b b
a
b a a a .
a (S A . 1468).
EXCEPTION: P aa a b
● T a
a .
b a
a a a
a a a ,
a m be ppo ed b a al able
con ide a ion. O a 38
P a a b a
a a a ab a a / a .
39
U A 1469 C C , a
a b a a ab , i hall
36
S A . 1354. - A a a be f cien ha i be o i h efe ence o ano he
a , a a hing ce ain, a a b
a , b a . a .
37
Bag a . C f A ea , , a 40
E befo e he ing of he p ice b he
a a: A 1458 a a b de igna ed hi d pa , a a a
a , . ., a b a ,a b a.
a , Ma a, a a 41
S A . 1472.
a a a a 42
F a a a a a
a a a a a b b
a a a a b
a . aa a b a .
B Ba (2E) A La 2022 9
EFFECT WHEN PRICE IS NEITHER CERTAIN OR .
ASCERTAINABLE
● W ca be de e i ed ● S
di i c ega
, , c ce , i h diffe e effec ,
a e i i ef caci (S A .
1474). .
● BUT, hi g a a he e f ha
bee de i e ed a da ia ed b ( ) Rai e he P e i f E i ab e
46
he b e , he m s pa a reasonable price M gage i a O di a Sa e;
43
herefor. ( ) Re de idab e a j dicia a e
○ T :
MANNER OF PAYMENT OF PRICE MUST BE 1) O
AGREED UPON ;
● A C C 2) T ,
,
.;
( ) Re de e ci ib e f a a e b d cia .

,
e e ia i g edie
V. FORMATION OF THE CONTRACT OF SALE
,
. R :
● W STAGES IN THE LIFE OF THE SALE
(PPC)
, (1) P . - N , ,
, ,
; ,
;
(2) P .- B ,
(S N .S
P C .). ;
(3) C . - D ,
44
GENERAL RULE: L
(A . 1355).45 .
EXCEPTIONS: I , ,
A. POLICITACION STAGE
43
W
● D i
he e fec i f a e,
. , ,
44
I ade ac f ice a gro nd for rescission of , ,
con en ional sale , ,
A 1381, :
1) T ,
.
1/4 ;
(2) T
,
46
T
1/4 . , ,
,
S A . 1470. - G
45
i ade ac f ice does no
affec a con rac of sale, e cep as i ma indica e a ,
defec in he consen , .
.

B B (2E) A L 2022 10
 ● A a a , accep o ejec he offe in i en i e ;
a , a a
a a a a a a
a . a a a ba.
● N a a ini ia ed b an ● T a a
offe , hich be ce ai . A a a b a a
a , co n e -offe , a
a a a a a a . A
a .A a , a c e - ffe i al a c ide ed i la
b a , a a a ejec i f he igi al ffe , a d ha
a a he effec f e i g i hi g he igi al
a a . To con e he offe in o ffe .
a con ac , he accep ance m be ● F a , a b
plain, neq i ocal, ncondi ional, and a , ,
i ho a iance of an o f om he a ,
p opo al (S Manila Me al Con aine , b a a
Co p. . PNB.). a b .51

1. Ad e i emen and In i a ion 3. Op ion Con ac . - A a p epa a o

● U a a , b con ac one pa g an o he o he ,
a a a f a ed e i d a d de eci ed c di i ,
no de ni e offe , b me e in i a ion he po e o decide, he he o no o en e
o make an offe (A . 1325). in o a p incipal con ac (S Ca celle . Co of
● A b a Appeal ).
a a a , a ● I b a a
a b a , a
b , a a
a a a (A . 1326). a , a , a
, a
2. Offe a
● A , a a , a , a
bjec o he comple e ill of he .
offe o 47. ● I a epa a e and di inc con ac
● I a b a b f ha hich he a ie a e e
a a ;a i he c ai f he
a a i . I b b
a a a .48 a .
● I offe i gi en fo a pe iod,
a ELEMENTS OF A VALID OPTION CONTRACT:
a a a a a (1) C ( , );
he offe .49
de o (2) S b a . - A op ion igh a
● T a igh o a ach o an a a a /a
offe an e m o condi ion he de i e , , a a a
a a , a a a b /a b ;
50
a a . (3) P a . - A con ide a ion52 e a a e a d
● T a di i c f he cha e ice
.
47
A . 1320 C C a T pe on
making he offe a he i e, lace a d a e 51
S A . 1323.
f acce a ce, a b . 52
I a , a
48
A . 1323 C C a a a b a
ma be i hd a n a a i e bef e acce a ce b ( . ., b , , a
c ica i ch i hd a al. ab ) a ( . ., a, a ab ,
49
S A . 1324. a a a ab , a
50
S A . 1321. a ).
B Ba (2E) A La 2022 11
OPTION CONTRACT DISTINGUISHED FROM SALE OPTION WITH SEPARATE CONSIDERATION
OPTION O e
● U e a a e he e he ce efe
CONTRACT c ac , f ca h e ae ( a ab e
a e a c de a ), in an i n c n ac
e aae he c n ide a i n ma be an hing
c de a nde aking f al e.53
f c ae ● A h gh c de a e e
ce. e ed a , a be
ed, a d ce e b d g (See
C e a
c ac ,
M a . C a c ).
ce he ● The c n ide a i n f an i n c n ac
ee g f doe no need be m ne a and ma
d a be an hing f al e; h e e , he
b ec a e he c de a e a , he
a d ce a e c de a be c ea ec ed
e e a. a ch he c ac c a e.
S
Whe he e ag ee e efd e
U aea Rec ca
c ac , A c ac ,
a e he c de a f he
ce nl he he eb e f c ac , ffe ee bea he
i ne i L he a e b de f g he e e ce f a
bliged ince b d h ef e aae c de a f he
he op ionee i E deli e a (See PNOC . Ke e P . H d , I c.).
obliged o pa hing
a epa a e c de a OPTION WITHOUT SEPARATE CONSIDERATION
con ide a ion. f he he
● W h a c de a e aae f
de a g
a he ice in
he cha e ce, an i n c n ac
m ne . ld be VOID a a c n ac , b o ld
ill con i e a alid offe (See Sa c e
The b ec .R ).
a e ● The b de f f h ha he
ac all no c ac a ed b a
he bjec e aaec de a h he a
ma e f
ee g h .
he gh
ale, b
● E e f he h e aae
a he he c de a c e a ce a ffe ,
be e e c ed h he
cha e ch e d a d he acce a ce
b ec be ab e (See T a . De
a e, R a -S a e ).
e e a a
a gbe
Acce ance f Offe C ea e O i n Nece a
b ec a e
a gh .
/ D ble Acce ance R le. - I a
c ac , he ffe ee ha he b de f g
ha he ed b a e a a e
OBLIGATIONS ON THE PART OF THE OFFEROR: c de a . The i n c n ac n
(1) N ffe an hi d a he ale ed b a e a a e c n ide a i n ca
f he b ec f he d g he appl onl if he op ion ha been accep ance and
e d; ch accep ance i comm nica ed o he offe e
(2) N i hd a he ffe i n (See Va e . C f A ea ).
d ing i n e i d; a d
(3) H ld he bjec ma e f ale he
ffe ee he e e ha ffe ee
e ec e h d g he The
53
ec g c ce he e a a e e
e d. f ch c de a f he cha e ce
ag eed .
B e B a c (2E) A e e La 2022 12
EXERCISE OF OPTION CONTRACT54 pa men of he price, a
● W e e c ac does no de e ed e e f e
con ain a period hen he op ion can be e ef a ce f
e ercised, ca be e ed a a f e a ee e .
e e ec e e e f ca be ade ● A a ac ed a ea e e
de e , a d e e e de ce a e e c ed e e d
e a f e b ec a e .55 e ed a d ca be dee ed
● I a b , he par in hose a e bee c ded e ed
fa or he op ion con rac e is a e e a f e ea e ( , aci a
a d a d effec e e e c e ec d cci ) (See Di . C f
b e e ad e ffe f e A eal ). BUT, Ca celle . C f
dec b a d e e A eal , e C a ed e e e c e
ead e a e a ed ce, f e be d e a
ded a e a e a a ab e a d e dd e a b a a c a ce
ac a de e ed e ffe ee ec e fa .
e ec a d de e b f e ● The op ionee has he righ , b no he
c e d deed f a e (See Va e obliga ion, o b . O ce he i i
.C f A eal ). e e ci ed i el , i.e., he ffe i acce ed
○ No ice of he e ercise of he op ion bef e a b each f he i ,ab aea
need no be co pled i h ac al e e a d b e e a d
b a e a e e ec ca b d
54
RULES WHEN PERIOD IS GRANTED TO PROMISEE
c e e ec e
(See A g Y A ci .C f A eal ): de a (See A g Y A ci .
1) If e period i self is no fo nded pon or C f A eal ).
s ppor ed b a separa e considera ion, e ffe
f ee a d a e da e ffe 4. Righ of Firs Ref sal
bef e acce a ce, , f a acce a ce a bee ● R f ef a d
ade, bef e e ffe c f c c e a e d ca
fac , b c ca a da a e
ea ,b d e e e e f
ffe ee ( acc da ce e Sa che . Rig ).
2) T e da , e e, be
c ac a c e ce e
e e c ed ca ab a ; e e, ab e ce f a ee e e ce
c d e e a da a e c a de A . 19. ce a , e ae b ec
3) If e period has a separa e considera ion, a c ac a e f ce e (See A g Y
c ac f dee ed e fec ed, a d A ci .C f A eal ).
d be a b eac f a c ac da e ● A f ef a canno be he
ffe d e a eed e d. s bjec of speci c performance, b
4) The op ion, ho e er, is an independen con rac
b each he a f he i ld
b i self, and i is o be di i g i hed f he
jec ed ai ag ee e hich i b i l e be
all a ec e f da age (See
c cl ded. If, fac , e e - ffe da G e e . Y ig ).
e ffe bef e acce a ce b e ● T e e need no be a separa e
ee- ffe ee, e a e a ef ec c considera ion in a righ of rs ref sal
ef a ce e ed c ac ce a since s ch s ip la ion is par and parcel
fa ed eac a e f e fec . T e of he en ire con rac of lease o hich
e - ffe , e e , e de e f ab e f i ma be a ached o; e c de a
da a e f b eac f e .
f e ea e c de ec de a
5) I e e ca e , ca e d be a e f e ea
a e f ec de a e , f f fac , a
f e f ef a (See
bee e ded be a f e c de a f e E a ial Real De . . Ma fai Thea e ).
a c ac a f da a e a
f e ee, e a c ac c d be dee ed
Ang Y As ncion . Eq a orial Real
e fec ed; a a a ce d be a ea e
e a e a ca e de ce e fec .
Co r of Appeals De . . Ma fair
55
U de A c e 1144 (1) f e C C de, ac Thea er
e c ac be b 10
ea , a d e eaf e , e f d R f ef a R f ef a
e c be.
B e B a c (2E) A e e La 2022 13
 d be e ed e e c e ch gh
be g aca f h d be e f ced
a he e he h e f he
e aa / dca acc d g he la
56 a g - e ee.
ea g e ed of contracts.
● I a gh f ef a , h e he
b la on human
b ec gh be ade de e a e, he
relations.
e ec e f he gh d be
de e de he g a
● The h d- a h b gh he e e a e e e a
e f he e e h a ed b d g d ca e a h a he
he gh f ef a g a ed he b a e , c d g he ce,
e ee f he e ca ca ha a e e be ed he ffe
be a a ge he a a ge e a d a be hd a a e b
a e a he ac f c ca g he hd a a he
e c ce ch b e ac a he a (See Va e . C f
e he h e f he e-e A eal ).
f he e b e fh cha e
a d a ed a he b ga f he 5. Mutual Promises to Bu and Sell / True
e de he ea e c ac , Contract to Sell
e ec a he he c a a ed ● The e e a de e ae h g
f he a e f he a e f he c ed h a c ea e e
e h (See Pa a a e Ki g b a a ec ed ce binding as an
E e i e , I c. . C f A eal ). e ecutor agreement (See S e
● A sale entered into in violation of a D mal, S . . C f A eal ).
right of rst refusal of another person ● The e a e b a d e
found in a valid principal contract is a ce ai hi g f a ce ai ice g e
rescissible (See G ma , B cali g & C . a e a gh de a d f he
.B e ie). he he f e f he b ga
○ The ba f he gh f ef a (See B me . F a c ).
be he c e ffe f he ● Acce ed b a e a e b a d
e e e he ffe cha e e a e e a , b
f a ec e b e . O af e e ac he a e, a a e fec ed
he e ee g a ee fa e ec e c ac f a e beca e he e a ead
gh de he a e e a d a ee g f d he h g
h he e d c e a ed ca h ch he b ec f he c ac a d
he e a d ffe e he he ce. BUT, a c ac f a e
e a h d e , aga c a ed de e a d
de he a e e a ffe ed a e , he ea ab aea e
he g a ee. b a d e g e he c ac g
● A right of rst refusal g a ed he a e i e am, ch ha each ha
c ac f ea e in favor of the lessee he gh de a d f he he he
cannot be availed of b the sublessee f e f he e ec e
beca e ch b e ee a a ge de a g .
he e h b d e ec he
gh f ef a fa f he B. PERFECTION STAGE 
e ee ; a d had he c ac f ● A c ac f a e b f he
ea e g a ed he e ee he gh e he e a meeting of minds
a g he ea e, he he a g ee upon the thing hich is the object of
the contract and upon the price and the
56
The dec E a ial Real ha he g manner of its pa ment.57 Th ee g
applies onl to rights of rst refusal attached to a f he d ea f he e f he
valid principal contract. Th , he A g Y A ci a e e e g he c ac
g d a gh f ef a e ec g he b ec a e a d he
c ed a e a a e c ac , h ch a a
d be c de ed de he d c e a cab e
c ac . 57
See A . 1475.
B e B a c (2E) A e e La 2022 14
 c d a . (3) Acce ance S bjec S en i e
C ndi i n. - E a
1. C n en ha Pe fec a Sale d a b c a a d c ,
● B a c a c ac , A c d d b c d a ,
1475 C C d d a a b c c d .
a c da
a d (4) Acce ance in A c i n Sale .62 - A a b
c b c c ac a d a c e fec ed hen he a c i nee
c . ann nce i e fec i n b he fall f he
● A c 1319 d c n en hamme , in he c ma manne (S
mee ing f mind a a ife ed b he P ce Ceb . He R a M a e ).
ee i g f he ffe a d he acce a ce U c a c ad , a b dd
he hi g a d he ca e hich a e a ac b d, a d a c a
c i e he c ac . da d a ,
○ The ffe m be ce ai 58 and he a c a b a c d b
acce ance ab l e59.60 .
● T d a
(1) Acce ance Ma be E e Im lied. - a c a d d
Acc a c a b d c db me ac , c a c c da d
c nd c , c mm nica ed he ffe , ei he a a b d a b dd ,
i af al a i f al a e , a c a c c d
a d a .
acc b .
2. When De ia i n All ed
(2) Acce ance b Le e Teleg am. - ● I an acce ance ma c n ain a
Acc a c ad b a d e e e f ce ain change in he e m
n bind he ffe e ce f m he ime i f he ffe and e be a binding
came hi kn ledge.61 T , acce ance, a c a a
a acc a c a b a d a acc a c
, a da a d ca acc
a b a d , c
acc a c . a d ,ac ac d (S

62
A . 1476. I ca a ale b a c i n:
58
W a a an ffe ce ain a d (1) W d a a b a c
b a d c , ac b c a aa c ac
b c a a a a a .
ible hing, lici , and de e mina e a lea (2) A a b a c c d
de e minable; a d ih a ice ha ha he a c a c c b a
e i i e f being eal, m ne i e i alen ( . ., a , c a a . U
c a ab c d a ), a d m be c a c ad , a b dd a ac
ce ain a lea a ce ainable, incl ding n he b d; a d a c a da d
e m f a men he e f. I d ,a a a c a b
c a a a a c d b .
b a b c a a d a c a (3) A bd a b d b
a a a da d b a b a , d d b
b c a a d c . a b a .
59
I d a acc a c a c (4) W c a b a a a b
c a a c dc ac , a c b c a bd b a
b lain and nc ndi i nal, a d i ill be , a b a bd
, if i i l e a e i i , f i ha ca e, i d c a bda
ill be i c f i i h he ffe , hich i ha c a b a a c ,
gi e i e he bi h f he c ac . d c a bda c a
60
A a d acc a c c a b a a a bd
c - c b ab a db .A
acc d a a da db d c ac . a c a a b a d a
61
S A . 1319. a d b b .
B B a c (2E) A La 2022 15
 V c .B ahec ).
G e onl he e A e a ale no
he e i al ead a e e fec ed.
3. Ea ne Mone
ale.
● W e e e ea e e g e a
a e, a be con ide ed a a of
W e ea e e W e e d-be
he ice and a oof of he e fec ion
g e , eb e b e g e
of he con ac (A . 1482).63
b d a e e, e
○ T e e e a a
ba a ce. e ed b , b
d ab e e a d
a e e f fe
e a e ab e ce f
de e d g e
c a eb a e de ce.
e f e .
● Ea ne mone , he efo e, i aid fo he
elle bene . I i par of he p rcha e
price hile a he ame ime proof of ● I e ab e ce f a ec c a ,
commi men b he po en ial b er. e e e f ea e a e ca ee e
Ab e f f a c ea ag ee e ea e e ece ed a e f
e c a , e ded be e da age a ed ee e e
f fe ed f e a e d e a e a e fa d e e fa f e
e e fa . T e o en ial ec e b e (See G de d, I c. .
b e bea he b den f g a C f A ea ).
ea e e a e ded e a ● W e e e e ee e cind he
a a f e c a e ce a d be ale, de A c e 1385 f e C
f fe ed f e ae d e cc C de, c e c c ea e e
e fa f e e e (A . b ga e e g c
1482). e e e b ec f e c ac ge e
● W e e e no o i ion fo fo fei e e f a d ee .
of ea ne mone in he ale fa
a e a e, e e e c 5. Place of Pe fec ion. - Ge e a , e a e
c e c be e e e ace f e fec e e e e a ee g
e ea e e a ega f e ffe a d e acce a ce e g
c e e ce f a e (See a d e ca e c ae c e e
G de d, I c. . C f A ea ). c ac (A . 1319).
● W ee a e e e e c a ged ffe
a d c e - ffe , e e be g 6. E en e of E ec ion and Regi a ion. - I
e fec f a c ac f ae e, ge e a , e e e e f e e ec a d
e g e a de ca be eg a f e a e a be b e b e
c de ed ea e e ce c e e, e ee a a e
e a e a e fec ed a e. c a .
● I e ca e f g d , e e e
4. Ea ne Mone and O ion Mone , ag eed, e e e e f, a d c de a
Di ing i hed. , g eg d a de e ab e
ae be b e b e e e (A .
1521).
EARNEST MONEY OPTION MONEY
● T e d d a e d e e
Pa of he cha e Mone gi en a a ae ed e e e.
ice. di inc
con ide a ion fo an
o ion con ac .

I
63
eg g f ea e e ,b e f
f e c c e ce f a e e e a ee e f
e ae c e ab e e e e ce f a
e fec ed a e.
B e B a c (2E) A e e La 2022 16