Polytechnic University of the Philippines

Course Title : Sales

Course Credit : Two (2) Units
First Semester : 2020-2021

ATTY. DANILO C. BARDE, LL.B.,LL.M.

COURSE DESCRIPTION:

Basically, Sales is covered by Book IV, Title VI of the Civil Code of the Philippines. It deals
with the basic principles, rights and obligations of the parties to a contract of Sale, remedies in
case of breach and the modes of extinguishment of this contract.

Course Objectives:

Understand the basic principles applicable to contract of sale. Identify the rights and
obligations of parties to a contract of sale. Encourage diligence and the observance of honesty
and fair dealings at all times. And appreciate and apply these fundamental principles to actual
business transactions.

Method of Instruction:

Every meeting the students will be called to recite within the assigned topic and cases,
and the professor shall amplify/supplement what has been recited by the students. All cases
assigned must be read in the original copy and the students called to recite are expected to
explain the same.

Course Outline:

I. Nature of contract

1. Basic concepts
2. Distinguished from other contracts and transactions
a. Contract for a piece of work
b. Contract of lease with option to buy
c. Dacion en pago
- Barter or exchange
- Agency to sell

3. Two kinds of contracts of sale

II. Essential elements and form

1. Essential elements of contract of sale

2. Consent of the contracting parties
3. Subject matter (object of contract)
4. Parties to the contract
5. Capacity of parties
a. Absolute
b. Relative
6. Formalities required in contracts of sale

III. Formation of contract of sale and perfection

1. Stages of contract of sale

2. Perfection of contract of sale
3. Rule in sale by auction

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IV. Transfer of ownership

1. How transfer of ownership effected

2. Forms of delivery
3. Rules on delivery of goods to carrier
4. Rues in sales of goods under certain forms
5. Sale by non-owner or without authority to sell
6. Rule on double sales

V. Risk of loss or injury to or benefit from thing sold

1. Effect of loss of thing before perfection
2. Effect of loss of thing after perfection but prior to delivery

VI. Rights and obligations of the vendor

1. To transfer ownership
2. Who can transfer ownership
3. Obligations of vendor, general
4. Obligation to deliver
- General Rule :Res perit domino
- Exception : Stipulations, security title,delay

a. To deliver the object and its accessions

b. Kinds of delivery of corporeal property
- Actual (real or material)
- Constructive (symbolic or formal)
- Traditio longa manu
- Traditio constitutum possessorium
5. Obligation to warrant the thing

a. Express
- Condition
- Dealer’s talk
- False representation

b. Implied warranties
- Warranty against eviction (warranty of title)
- Warranty against hidden encumbrances or defects
- Warranty of quality

6. Expenses

VII. Rights and obligations of the vendee

1. Obligations of vendee, in general

2. Acceptance in sale of goods in particular
3. Obligation to pay the price
- Payment of price
- Time and place
- Liability for interest
4. Right of inspection / examination
5. Right to the fruits
6. Acceptance

VIII. Condition and warranties

1. Condition
2. Warranties
3. Warranty against eviction
4. Warranty against hidden defects

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 IX. The MACEDA Law (RA6552) sale of immovables on installment

X. Remedies for breach of contract

1. Remedies of an unpaid seller

a. Withhold delivery (possessory lien)
b. Stoppage in transit
c. Resell the goods
d. Rescission
e. Action for the price – specific performance
f. Action for damages

2. Remedies for the buyer

a. Specific performance
b. Damages
c. Rescission

XI. Remedies of Parties

1. Sale of personal property on installment
2. Sale of immovable property
3. Sale of goods
4. Action for breach of contract of sale of goods

XII. Recto Law – Sale of movable on installments

XIII. Extinguishment of sale

1. Causes for extinguishment of sales
a. Conventional redemption
a.1. conventional redemption
a.2. equitable mortgage
a.3.period of redemption in Pacto de Retro Sale
a.4.Rights of the parties during pendency or prior to repurchase
a.5. exercise of rights of redemption
a.6. effects of repurchase (redemption)
a.7. effects of failure to exercise right to repurchase

b. Legal redemption
b.1. legal redemption
b.2. legal redemption under the civil code
b.3. legal redemption among co-owners
b.4.legal redemption among co-heirs
b.5. legal redemption among adjoining owners

XIV. Assignment of credit

1. Concept
2. Formalities required in assignment of credit
3. Perfection and consummation
4. Effects of assignment of credit
5. Extinguishment of credit or other incorporeal right

Textbook:

1. Civil Code of the Philippines, Vol. V, Paras

Cases:

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 1. Olivarez Realty corporation and Dr. Pablo Olivarez vs. Benjamin Castillo, GR No. 196251,
July 9, 2014
2. Helen e. Cabling vs. Joselin Tan Lumapas GR No. 196950, June 18, 2014
3. Melecio Domingo vs. Spouses Genaro Molina and Elena B. Molina, GR No. 200274, April
20, 2016
4. Anecita Gregorio vs. Maria Crisologo vda de Culig, GR No. 180550, January 20, 2016
5. Juan P. Cabrera vs. Henry Ysaac, GR No. 166790, November 19, 2014
6. Spouses George A. Gallent, sr. and Mercedes M. Gallent vs. Juan G. Velasquez, GR No.
263949, April 6, 2016
7. First Optima Realty Corp vs. Securitron Security Services, Inc. GR No. 199648, January
28, 2015
8. Florita Liam vs. United Coconut Planters Bank, GR No. 194664, June 15, 2016.
9. Union Bank of the Philippines vs. Philippine Rabbit Bus Lines, GR No. 205951, July 4,
2016
10. Sergio R. Osmena III vs. Power Sector Assets and Liabilities Management Corporation,
GR No. 212686, September 28, 2015
11. William Angidan Siy vs. Alvin Tomlin, GR No. 205998, April 24, 2017
12. Far East Bank and Trust Company vs. Philippine Deposit Insurance Corporation, GR No.
172983, July 22, 2015
13. Tuazon vs. Del Rosario-Suarez, GR No. 168325, December 8, 2010
14. NFF Industrial Corporation vs. G & L Associated Brokerage and/or Gerardo Trinidad, GR
No. 178169, January 12, 2015
15. Orion Savings Bank vs. Shigekane Suzuki, GR No. 205487, November 12, 2014
16. Spouses Avelino vs. Spouses Celedonio, GR No. 135900, August 17, 2007
17. Roberto R. David vs. Eduardo C. David, GR No. 162365, January 15, 2014
18. GE Money Bank, Inc. (formerly Keppel Bank) vs. Spouses Victorino M. Dizon and Rosalina
L. Dizon, GR No. 184301, March 23, 2015
19. Heirs of Reynaldo Dela Rosa vs. Mario A. Batongbacal, GR No. 179205, July 30, 2014.

Assignment for the first week of classes.

1. Read and understand Articles 1458 to 1468, Civil Code.

2. What is a contract of sale?
3. Is it relevant to distinguish a contract of sale from a contract to sell?

To be able to answer the following questions:

4. Is there a perfected contract of sale after one party transfers possession of a

determinate thing in favor of the other party? Explain
5. I will buy your pen that you are holding now, then you agreed, is there a contract of
sale? Explain
6. What makes a mortgage an accessory contract as distinguished from a contract of sale?
Explain