Answer the following questions:

1. What are the obligations of the vendor?

Obligations of the vendor

1. To transfer ownership of the thing sold;

2. To deliver the thing;

3. To warrant the object sold against eviction and hidden defects;

4. To take care of the object sold pending delivery; and

5. To pay for the expenses for the execution and registration of the contract of sale unless there
is a stipulation to the contrary.

2. Define "delivery".

"Delivery" as used in the Law on Sales refers to the concurrent transfer of two things: (1)
possession and (2) ownership.

Delivery has been described as a composite act, a thing in which both parties must join and the
minds of both parties concur. It is an act by which one party parts with the title to and the
possession of the property, and the other acquires the right to and the possession of the same.

3. Differentiate between "actual delivery" and "constructive delivery".

Actual delivery consists in placing the thing sold in the control and possession of the vendee.
Legal or constructive delivery, on the other hand, may be had through any of the following
ways: the execution of a public instrument evidencing the sale; symbolical tradition such as the
delivery of the keys of the place where the movable sold is being kept: traditio longa manu or
by mere consent or agreement if the movable sold cannot yet be transferred to the possession
of the buyer at the time of the sale; traditio brevi manu if the buyer already had possession of
the object even before the sale; and traditio constitutum possessorium, where the seller
remains in possession of the property in a different capacity.

4. What are the kinds of delivery? Explain each.

Kinds of Delivery

1. Real or Actual

The thing sold is placed in the control and possession of the vendee.

2. Legal or Constructive

It is a delivery by operation of law.

3. Quasi-Tradition

Delivery of rights, credits, or incorporeal property, made by:

a. Execution of public instrument;

b. Placing of titles of ownership in the hands

c. Allowing buyer to make use of rights.

5. What are the kinds of Legal or constructive delivery? Explain each.

Kinds of Legal or Constructive Delivery

a. Legal Formalities

When the sale is made through a public instrument. The delivery by execution of public
instrument gives rise to prima facie presumption of delivery, which is destroyed when actual
delivery is not affected due to legal impediment.

b. Symbolical Tradition or Traditio simbolica

The parties use a symbol to represent the thing delivered.

c. Traditio Longa Manu

The delivery is by mere consent or agreement of the contracting parties, where the seller points
out to the buver the object of sale without the need of actually delivering it.

d. Traditio Brevi Manu

This occurs when the would be buyer had already the possession of the object even before the
contract of sale by virtue of another title which is not ownership (like a lessee in a Contract of
Lease), and pursuant to a contract of sale, he would now hold possession in the concept of an
owner (like a buyer of a house where he was a former lessee of the same house). This is
opposite of constitutum possessorium.

e. Traditio Constitutum Possessorium

The delivery consists in the owner's continuous possession of the property he had already sold
to another person but his present possession is no longer that of an owner but under another
capacity, like that of a lessee. This is opposite of traditio brevi manu.

6. Distinguish between "sale on approval" and "sale or return".

Sale on approval also called " sale on acceptance," "sale on trial," or "sale on satisfaction".
There is no transfer of ownership notwithstanding delivery of the goods. Ownership passes to
the buyer only in the following instances:

1. When the buyer signifies his approval or acceptance to the seller or does any other act
adopting the transaction; and

2. If the buyer does not signify his approval or acceptance to the seller, but retains the goods
without giving notice of rejection, then if a time has been fixed for the return of the goods, on
the expiration of such time, and, if no time has been fixed, on the expiration of a reasonable
time.
On the other hand, in a "sale or return" the ownership passes to the buyer on delivery The
subsequent return of the goods reverts ownership in the seller. Delivery or tradition as a mode
of acquiring ownership must be in consequence of a contract, e.g. sale.

Sale on Approval Sale or Return

Ownership remains in the seller until the

buyer signifies his approval or acceptance to
Ownership passes to the buyer on delivery
the seller.
and subsequent return reverts ownership in
the seller.

Subject to a resolutory condition. Subject to suspensive condition

Depends entirely on the will of the buyer. Depends on the quality of the goods

Risk of loss rests upon the buyer Risk of loss remains with the seller.

7. Give examples of documents of title to goods and define each.

Document of title to goods:

BILL OF LADING

A document acknowledging the receipt of goods by a carrier or by the stripper's agent and the
contract for the transportation of those goods, a document that indicates the receipt of goods
for shipment and that is issued by a person engaged in the business of transporting or
forwarding goods.

A document that serves as evidence of receipt of goods for shipment issued by a common
carrier.
DOCK WARRANT

An interim document issued by a maritime carrier to evidence the delivery of goods at the dock.

A warrant given by dock-owners to the owner of merchandise imported and warehoused on

the dock.

QUEDAN

A warehouse receipt that covers sugar.

WAREHOUSE RECEIPT

A document evidencing title to goods stored with someone else; esp., a receipt issued by a
person engaged in the business of storing goods for a fee.

A warehouse receipt, which is considered a document of title, may be a negotiable instrument

and is often used for financing with inventory as security.

A receipt received by the bailee to be delivered to the bearer or to the order of any person
named in such receipt or to a specified person.

8. Define "bill of exchange", "bill of lading", and "negotiable instrument".

Bill of exchange

An unconditional written order by one person to another, signed by the maker, requiring the
person addressed to pay to a third party a specified sum on demand or at a fixed or
ascertainable future time.

Bill of lading

A document acknowledging the receipt of goods by a carrier or by the shipper's agent and the
contract for the transportation of those goods; a document that indicates the receipt of goods
for shipment and that is issued by a person engaged in the business of transporting or
forwarding goods.

Negotiable instrument

A written instrument that is signed by the maker or drawer, includes an unconditional promise
or order to pay a specified sum of money, is payable on demand or at a definite time, and is
payable to order or bearer.

9.What are the differences between "accessions" and "accessories"?

Accessions vs Accessories

Accessions Accessories

It signifies all of those things which are It signifies all of those things which have for
produced by the thing which is the object of their object the embellishment, use of
the obligation as well as all of those which preservation of another thing which is more
are naturally or artificially attached thereto. important and to which they are not
incorporated or attached. In other words, it
Example.
includes all of those things which are
"A partner's share in the profit in a contract necessary or convenient for the perfection of
of partnership." "Earphone of a cellphone." another thing such as the equipment of a
"Mouse pad of a computer." factory, the spare parts and tools of a
machine, the key of a house, and others of a
similar nature.

10.What is judicial sale?

A judicial sale involves the sale of a mortgaged property under the intervention of a court. It is
typically ordered in instances of dispute where:
  The property debt cannot be resolved
 The borrower is insolvent
 The borrower cannot afford to continue their mortgage payments
 It has been determined by independant appraisal that there is equity left in the home

11.When is there "double sale"?

There is a double sale when there is a selling of the same property by the same seller to
different buyers with conflicting rights.The following instances must be concurring:

 There are two or more transactions must constitute valid sales

 It must pertain exactly to the same object or subject matter
 They must be bought from the same or immediate seller and two or more buyers who
are at odds over the rightful ownership of the subject matter must represent conflicting
interests.

12.Distinguish between "warranty" and "condition".

Warranty vs. Condition

WARRANTY CONDITION

Goes into the performance of such obligation Goes into the root of the existence of the
and in fact may constitute an obligation itself obligation

May form part of the obligation or contract Must be stipulated by the parties in order to
by provision of the law without the parties form part of an obligation
having agreed thereto

Non-fulfillment of a warranty would Although it may extinguish the obligation

constitute a breach of contract upon which it is based, it generally does not
amount to a breach of contract of sale

13.Differentiate between "express warranty" and "implied warranty."

Express Warranties.A seller or lessor can create an express warranty by making representations
concerning the quality, condition, description or performance of the potential goods. To create
a bargain, the seller does not have to use formal words such as a warrant or a guarantee.

Implied Warranties. It is one that the law derives by implication or inference because of the
circumstances of a sale, rather than by the seller’s express promise. In an action based on
breach of implied warranty, it is necessary to show that an implied warranty existed and that
the breach of the warranty proximately cause the damaged sustained.

14. Differentiate between "warranty against eviction" and "warranty against hidden defects".

Warranty against eviction- An implied warranty on the part of the seller that he has a right to
sell at the time when ownership is to pass and that the buyer shall from that time have and
enjoy the legal and peaceful possession of the thing

Warranty against hidden defects-An implied warranty that the thing shall be free from any
hidden defects or any change or encumbrances not declared or known to the buyer.Hidden
defects are those which are not visible to vendee who is not an expert and to a vendee who is
an expert but even with the use of his trade or profession could not detect such defect

15.What is the difference between "negotiation" and "assignment"?

The various points of distinction between negotiation and assignment are as below:
1.Negotiation refers to the transfer of the negotiable instrument, by a person to another to
make that person the holder of it while assignment implies the transfer of rights, by a person to
another, for the purpose of receiving the debt payment

2. Negotiation requires delivery only to constitute a transfer, whereas assignment requires a

written document signed by the transferor.

3. Consideration is always presumed in the case of transfer by negotiation. In the case of

assignment consideration must be proved.
4.. In case of negotiation, notice of transfer is not necessary, whereas in the case of assignment
notice of the transfer must be given by the assignee to the debtor.
5. The assignee takes the instrument subject to all the defects in the title of the transferor. If
the title of the assignor was defective the title of the assignee is also defective. However, in
case of negotiation the transferee takes the instrument free from all the defects in the title of
the transferor. A holder in due course is not affected by any defect in the title of the transferor.
He may therefore have a better title than the transferor.
6. In case of negotiation a transferee can sue the third party in his own name. But an assignee
cannot do so.