Article 1519 if an injunction is issued but the

negotiable document of title is

The bailee has the direct obligation to negotiated to an innocent person, the
hold possession of the goods for the transfer is nevertheless effectual.
original owner or to the person to whom
the negotiable document of title has Article 1521
been duly negotiated.
Specifications for delivery.
Rules regarding attachment or
surrender. (if the document us RULES REGARDING PLACE OF
negotiable) DELIVERY.

1. GENERAL RULE a. Where there is an agreement,

express or implied, the place of delivery
Generally, no attachment or levy. Excpt: is that agreed upon

m
if the document is surrendered to bailee.

er as
(2) the negotiation of the document b. Where there is no agreement, the

co
enjoined. place of delivery is that determined by

eH w
usage of trade.

o.
Surrender of goods
rs e c. Where there is no agreement and
ou urc
2. Surrender of goods there is also no prevalent usage, the
place of delivery is the seller’s place of
GENERAL RULE business
o

The bailee cannot be compelled to

aC s

d. In any other case, the place of

surrender the goods. Excpt: (1) if the
vi y re

delivery is the seller’s residence; and

document is surrendered to him (2)
document is impounded by court. e. In case of specific goods, which to the
knowledge of the parties at the time the
ed d

Article 1519 do not apply if the person contract was made were in some other
ar stu

depositing is not the owner of the goods place, that place is the place of delivery,
(like a thief) or one who has no right to in the absence of any agreement or
convey title to the goods binding upon usage of trade to the contrary.
is

the owner
RULES REGARDING TIME OF
Th

Article 1520 DELIVERY

Creditor’s remedies to reach negotiable a. The time of delivery is also
sh

documents. \ determined by the agreement of the

this article expressly gives the court full parties
power to aid by injunction and otherwise b. If no time is fixed by the contract, then
a creditor seeking to get a negotiable the seller is bound to send the goods to
document covering such goods. the buyer within a reasonable time.

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 Reasonable time – question of fact, - this not apply in case a negotiable
depending upon circumstances. document of title has been issued

Character of good - does not apply when the goods are still
to be manufactured. Only applies to
Purpose intended existing goods but in the hand of a third
Ability of seller to produce goods. party.

Transportation facilities RULES REGARDING HOUR OF

DELIVERY OF GOODS SOLD.
transportation and distance the
goods must be carried a. the demand or tender of delivery to
be effectual must be made at
the time reasonably necessary to reasonable hour of the day.
manufacture and deliver them furnishes

m
the test. b. What is a reasonable hour is a

er as
question of fact largely dependent upon

co
c. If the contract provides a fixed time the circumstances.

eH w
for performance, the question is whether

o.
time is of the essence, and if so, c. if goods are bulky or heeded special
whether correct performance was rs e care, an hour might be unreasonable
ou urc
offered within that time. which would not be so in an ordinary
payment of a small sum of money.
d. Where the contract does not specify
o

the time for delivery so that delivery is to DUTY OF SELLER TO PUT GOODS IN
aC s

be made within a reasonable time, time DELIVERABLE CONDITION.

vi y re

is not of the essence. a. Unless otherwise agreed, the seller

- In such case, the buyer cannot bears the expenses to place the thing in
ed d

make time the essence of the contract a deliverable state.

ar stu

without giving the seller notice of his b. The buyer is not bound to make
intention to cancel unless delivery is tender of payment until the seller has
made on or before a fixed time. complied with his obligations.
is

DELIVERY OF GOODS IN c. even si Buyer ang mag pipick-up ng

Th

POSSESSION OF A THIRD PERSON. goods ay dapat nasa delivery state pa

It is essential here that the person rin.
sh

acknowledge that he holds the goods

not in behalf of the buyer, otherwise, the
seller shall not yet be complied with his
duty to deliver.

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 Article 1522 EXCEPTION

Delivery of goods less than quantity
contracted. the buyer may reject the
goods so delivered
The buyer may, however, accept the
goods in which case he must pay for
their (1) price at the contract rate if he
knew that no more were to be delivered
or (2) the fair value to him of the goods,
if he did not know that the seller is going
to be guilty of a breach of contract
Delivery of goods more than quantity
when a contrary intent appears, that is,
the parties did not intend the delivery of
the goods to the buyer through the
carrier.
- The seller is not responsible for
misdelivery by the carrier where the
carrier was chosen and authorized by
the buyer to make the delivery.
SELLER’S DUTY AFTER DELIVERY
TO CARRIER.

m
The two obligations of the seller are

er as
contracted.
respectively subject to specific

co
Where the seller delivers a quantity instructions of the buyer or any

eH w
larger than that contracted for, the buyer agreement to the contrary.

o.
may accept the quantity contracted for
rs e
and reject the excess. Or accept all a. To enter on behalf of buyer into such
ou urc
basta babayaran lahat. contract reasonable under the
circumstances. – si seller ang makikipag
Delivery of goods mixed with others. contract sa courier in behalf of buyer.
o
aC s

the buyer may accept those which are in Kapag tumanggi si buyer na ideliver ni
vi y re

accordance with the contract and reject seller kay courier ang goods then
the rest. nawala ito while in transit then the seller
should be held responsible.
ed d

Pwedeng i-reject lahat if the subject

ar stu

matter is indivisible. b. To give notice to buyer regarding

necessity to insure goods – dapat inotify
Article 1523 ni seller si buyer na i-insure ang goods.
is

Delivery to carrier on behalf of buyer. Kapag hindi nanotice, si seller ang liable
for loss. Kapag nanotice naman si
Th

GENERAL RULE. Where the seller is buyer, then wala ng liability si seller.
authorized or required to send the
goods to the buyer the general rule is KINDS OF DELIVERY.
sh

that delivery of such goods to the carrier C.O.D. — The initials stand for the
constitutes delivery to the buyer, words, “collect on delivery.” If the goods
whether the carrier is named by the are marked C.O.D., the carrier acts for
buyer or not. the

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 seller in collecting the purchase price.
The buyer must pay for the goods
before he can obtain possession.
C.O.D. terms do not prevent title from
passing to the buyer on delivery to the
carrier where they are solely intended
as security for the purchase price.
F.O.B. — The initials stand for the
words, “free on board”. They mean that
the goods are to be delivered free of
expense to the buyer to the point where
they are F.O.B
- the seller must deliver, and the buyer
must pay. If the buyer does not pay, the
seller is not required to deliver. This is
because a sale is reciprocal contract
giving rise to reciprocal obligations,
- the vendor is not obliged to make
delivery if no period has been fixed in
the contract and the vendee has not
paid the price.
WHEN DELIVERY MUST BE MADE
BEFORE PAYMENT OF PRICE.

At the place of shipment – they the rule is that the thing shall not be

m
er as
buyer must pay the freight delivered unless the price be paid; and
the exception is that the thing must be

co
eH w
at the place of destination – seller delivered though the price be not first
will pay the freight till the destination paid, IF TIME for such payment has

o.
rs e
alongside (the vessel) of Free
been fixed in the contract.,
ou urc
alongside ship – goods are brought Article 1525
alongside the vessel; the buyer will pay.
Unpaid seller – one who has not been
o

C.I.F. — The initials stand for the words, paid or tendered the whole price or who
aC s
vi y re

“cost, insurance and freight.” They
signify that the price fixed covers not
only the cost of the goods, but the
expense of freight and insurance to be
ed d
has received a bill of exchange or other
negotiable instrument as conditional
payment and the condition on which it
was received has been broken by

paid by the seller (ibid.) up to the point reason of the dishonor of the instrument.
ar stu

of destination. Title passes to the buyer

at the moment of delivery to the point WHERE WHOLE OF PRICE HAS NOT
especially named. BEEN PAID
is

a. Tender of payment by buyer - tender

Th

KAPAG SI BUYER NA ANG

NAGBAYAD NG FREIGHT THEN NA destroys the seller’s lien (.an
KAY SELLER NA YUNG OWNERSHIP unconditional offer by a debtor or obligor
KAHIT HINDI PA NADIDELIVER KAY to pay another, in current coin of the
sh

BUYER. realm) Accordingly, so far as concerns

his rights against the goods, he is not an
Article 1524 unpaid seller after the tender of the
price.

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 b. Payment of part of price. — Payment
of a part only of the price does not
destroy a seller’s lien. The seller
remains an unpaid seller even if title has
passed to the buyer.
SALE WITHOUT STIPULATION AS TO
CREDIT. — In a credit sale, the seller
binds himself to give the goods over to
the buyer without receiving at that time
payment for them.

c. Payment by negotiable instrument -

“the delivery of promissory notes
payable to order, or bills of exchange or
other mercantile documents shall
produce the effect of payment only when
they have been cashed or when through
the fault of the creditor they have been
impaired.”
EXPIRATION OF TERM OF CREDIT. —
the buyer is entitled to possession of the
goods without paying the price; but if he
fails to exercise his right until the term of
credit has expired and the price
becomes due, he loses the right which
he theretofore had.

m
er as
Article 1526
INSOLVENCY OF THE BUYER. — The

co
eH w
Even if the ownership in the goods has insolvency of the buyer is another
already passed to the buyer, the unpaid situation where the lien of the seller in

o.
rs e
seller may exercise the following rights: possession is revived even though the
ou urc
time for payment of the price has not yet
(1) A lien on the goods or right to retain arrived.
them for the price while in his
o

possession Article 1528

aC s
vi y re

(2) A right of stopping the goods in When part of the goods are delivered,
transitu in case of insolvency of the the unpaid seller has a lien upon the
buyer remainder for the proportion of the price
which is due on account of the goods so
ed d

(3) A right of resale; and retained.

ar stu

(4) A right to rescind the sale. Excpt. - if the delivery of the part is
Article 1527 intended as symbolical delivery of the
is

whole, and, therefore, a waiver of any

the unpaid seller of goods who is in
Th

right of retention as to the remainder,

possession of them is entitled to retain the lien is lost.
possession of them until payment or
tender of the price in the following Article 1529
sh

cases, namely: (hindi mawawala ang The unpaid seller of goods loses his lien
possession ni seller hangga’t hindi siya thereon
nababayaran)
a. Delivery to agent or bailee of buyer –
REMEDIES kapag deliver na ni seller ang goods sa

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 agent or bailee ni buyer then the the same rights to the goods as if he
possessory lien ay mawawal pero sa had never parted with the possession
price meron. thereof.

b. Possession by buyer or his agent - If Requisites;

the goods are already
in the possession of the buyer at the
time of the bargain, it is plain that when
the ownership is transferred, the seller
has no lien simply because he has no
possession necessary for a lien.
c. Waiver of the lien. — The seller may
lose his lien either by express
(1) The seller must be unpaid (Art.
1525.);
(2) The buyer must be insolvent;
(3) The goods must be in transit (Art.
1531.);
(4) The seller must either actually take
possession of the goods sold or give

m
er as
agreement to surrender it. Thus, it has notice of his claim to the carrier or other
been held that where the buyer was

co
person in possession (Art. 1532, par.

eH w
allowed to alter the character of the 1.);
goods and make them much more

o.
rs e
valuable, the seller could no longer (5) The seller must surrender the
ou urc
assert a lien. negotiable document of title, if any,
issued by the carrier or bailee (Ibid., par.
REVIVAL OF THE LIEN 2.); and
o

If the buyer refuses to receive the goods

aC s

(6) The seller must bear the expenses of

vi y re

after they have been delivered to a
carrier or other bailee on his behalf,
though. The seller has parted with both
the ownership and the possession, he
ed d
delivery of the goods after the exercise
of the right.
The essential basis of the right of

may reclaim the goods and revest stoppage in transitu is clearly the
ar stu

himself with his lien. injustice of allowing the buyer to acquire

ownership and possession of the goods
Likewise, if the buyer returns the goods when he has not paid and, owing to his
is

in wrongful repudiation of the sale, the insolvency, cannot pay the price which
Th

lien is revived. was to be given in return for the goods.

Article 1530 Article 1531
sh

WHEN THE BUYER OF GOODS IS OR
BECOMES INSOLVENT
Right of seller to stop goods in transit –
The unpaid seller exercising his right of
stoppage in transitu becomes entitled to
The goods are not yet in transit until
they are delivered to a carrier or other
bailee for the purpose of transmission to
the buyer.
The goods are in transit —

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 (1) after delivery to a carrier or other his agent to prevent the delivery to the
bailee and before the buyer or his agent buyer.
takes delivery of them; and
Article 1533
(2) if the goods are rejected by the
buyer, and the carrier or other bailee Unpaid seller’s right of resale.
continues in possession of them. (1) When resale allowable. — The third
right of an unpaid seller is the right of
resale. WHEN HE HAS EITHER A
When goods considered no longer RIGHT OF LIEN. a RIGHT TO STOP
THE GOODS IN TRANSITU
in transit.
(a) where the goods are perishable in
(1) After delivery to the buyer or his nature;
agent in that behalf;

m
er as
(b) where the right to resell is expressly
(2) If the buyer or his agent obtains

co
reserved in case the buyer should make

eH w
possession of the goods a default; and

o.
at a point before the destination
originally fixed; rs e (c) where the buyer delays in the
ou urc
payment of the price for an
(3) If the carrier or bailee acknowledges unreasonable time.
to hold the goods on
o

(2) Effect of resale. — he sells for less

aC s

behalf of the buyer; and than the price, he has a right to sue for
vi y re

the balance.
(4) If the carrier or bailee wrongfully
refuses to deliver the goods to the (3) Notice of resale not essential – ang
buyer. pagreresale ay depende kung length of
ed d

time the buyer has been in default.

ar stu

Article 1532 Pwedeng yung notice is to inform buyer

that is the time na kailangan na niyang
The seller may exercise the right of
iperform ang obligation.
is

stoppage in transitu either:

(4) Manner of resale. — Any absolute
Th

(1) by taking actual possession of the

rule requiring the formality of an auction
goods. — The seller’s power to stop in
sale might bear harshly on the seller in
transitu includes not only the power to
case where the goods are of small value
sh

counter delivery to the buyer but to

order redelivery to himself
(2) by giving notice of his claim to the
carrier or bailee - may communicate it to
and the buyer is financially irresponsible
Article 1544
Unpaid seller’s right of rescission.

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 (1) When seller may rescind. — The
fourth right of an unpaid seller is the
right to rescind the sale. An unpaid
seller has a right to rescind only if he
has either a right of lien or a right to stop
the goods in transit under two situations.
(a) where the right to rescind is
expressly reserved in case the buyer
should make a default; or
document of title, the seller’s lien cannot
prevail a
The rule protects a purchaser without
notice after the seller had stopped the
goods either by virtue of his right of lien
or stoppage in transitu.gainst the rights
of a purchaser.

(b) where the buyer delays in the

payment of the price for an Article 1536
unreasonable time.
Right of vendor to withhold delivery in

m
er as
(2) Effect of rescission - the seller sale on credit.
resumes ownership in the goods. While

co
eH w
the seller shall not be liable to the buyer But even if the vendee was given the
upon the contract of sale, the latter, benefit of a period, the vendor may not

o.
rs e
however, may be made liable to the be compelled to make delivery, in case
ou urc
seller for damages for any loss the vendee should lose the right to
occasioned by the breach of contract. make use of the term.
o

(3) Manner of rescission. — An election (1) When after the obligation has been
aC s

by the seller to rescind may be contracted, he becomes insolvent,

vi y re

manifested by notice to the buyer or by unless he gives a guaranty or security

some other overt act showing an for the debt [price];
intention to rescind.
(2) When he does not furnish to the
ed d

Article 1535 creditor [vendor] the guaranties or

ar stu

securities which he has promise.

Effect of sale of goods subject to lien or
stoppage in transitu. (3) When by his own acts he has
is

impaired said guaran-ties or securities

(1) Where goods not covered by after their establishment, and when
Th

negotiable document of title. — as a through a fortuitous event they

general rule, that a seller can give no disappear, unless he immediately gives
larger right than he has. new ones equally satisfactory;
sh

(2) Where goods covered by negotiable (4) When the debtor [vendee] violates
document of title. — If, however, the any undertaking, in consideration of
goods are covered by a negotiable which the creditor agreed to the period;

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 (5) When the debtor [vendee] attempts
to abscond.”

Article 1537

Condition of thing to be delivered. The

vendor is, obliged to preserve the thing
pending delivery

Right of vendee to the fruits.

(1) When vendee entitled. — The

vendee has a right to the fruits

of the thing sold from the time the

obligation to deliver it arises.

m
er as
(2) When vendee not entitled. — In the

co
eH w
following cases, the vendee is not
entitled to the fruits:

o.
rs e
(a) When the rule provided in Article
ou urc
1537 (par. 2.) is modified by agreement
of the parties, their agreement shall, of
o

course, govern;
aC s

(b) If the vendee rescinds the contract of

vi y re

sale instead of exacting the fulfillment

thereof, he is entitled only to damages
like interest, attorney’s fees and costs
ed d

but he may not also claim the fruits of

ar stu

the thing sold

(c) In a contract of promise to sell, the

is

vendee is not entitled to the fruits. The

only right of the contracting parties is to
Th

reciprocally demand the fulfillment of the

contract. Prior to the sale and
conveyance of the subject matter of the
sh

contract, the promisee or would-be

vendee acquires no right to the fruits
thereof

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