SALES / CHAPTERS CHECKLIST

Article 1458 Definition of Sale

 SALE is a title not a mode of ownership

 MODE is a legal means by which dominion or ownership is created, transferred or destroyed
(succession, donation, discovery)

Sale vs. other Similar Contracts

 Under Lying Principle:
Intent of parties and elements of relationship are more important than nomenclature used to
describe a certain contract
- Meaning, diri it nakabutangan nga ngaran hit contract it ginbabasehan hit contract, kundi an
intention. Kun an title nasiring Deed of Sale, and yet iba an intent han parties, the intent shall
prevail.

Contract, how defined

- What the law defines it to be, taking into consideration the essential elements
- Title given to it is not as much significant as its substance
- Real character of contract is determined by courts by looking at the intent of parties- the true
aim and purpose in entering into contract.
o Through their conduct, words, actions and deeds prior to, during and immediately after
executing agreement – not how nomenclature defines it.

Article 1460 Determinate thing

- Particularly designated or physically segregated from all other class
- Satisfied at the time contract is entered
- Thing is capable of being determinate w/o necessity of a new or further agreement
Emphasis of determinate: delivery and transfer can only be made when subject matter becomes
specific/ determinate

 Remedy of vendor if thing is determinate:

o Compel debtor to deliver
 If thing is indeterminate or generic:
o [vendor] ask for the compliance of obligation at the expense of debtor
o If obligor delays (or promised to deliver the same thing) he shall be responsible for any
fortuitus event until effecting delivery

Elements of Contract
1. Consent or meeting of minds [to transfer ownership in exchange for a price]
2. Subject matter
3. Price, certain in money or equivalent
NOTE:
Presence of all three elements leads to perfection of contract
- Previous fictitious deed of sale shall not affect validity of
the present and non-performance, thereafter
 DEFECT: makes contract VOIDABLE if there is vitiation of
consent
 VOID if mandated under Art. 1409
Stages in the Life of Sale
In general: only perfection and consummation
According to the Supreme Court:
1. Policitation – time when parties indicated interest to the time when contract was perfected
2. Perfection – concurrence of essential elements of sale
3. Consummation – when parties perform respective obligations

ACTUAL DELIVERY: not necessary component to establish existence of valid sale

Thus, non-delivery or non-payment does not invalidate or void perfected sale
- It only becomes legal basis for remedies
PRINCIPLE on BINDING EFFECT OF SALE: binding effect of sale, obligations arising therefrom have force of
law between parties.
(kun ano an nakasabutan han parties, an ira magiging balaod)

Article 1332 Language of Contract

- If contract is in language not understood by him, and mistake or fraud is alleged, person enforcing
contract must show terms have been fully explained to former
GR: He who alleges existence of sale must show it by competent proof (Art. 1332)
SALE vs. DONATION
Essentially onerous Generally gratuitous
Perfected by consent Solemn contract- requiring formalities
No diminution of seller’s estate – if property if sold, Causes diminution of seller’s estate – may prejudice
money is exchanged legitimes of heirs- thus, is subject to recission
Valid sale does not legally effect deprivation of heirs
or legitimes
SALE vs. BARTER
One of the parties binds himself to deliver a thing in One of the parties binds himself to give one thing in
consideration of the other’s undertaking to pay the consideration for the other’s promise to give
price in money or its equivalent. another thing
SALE vs. Contract of PIECE OF WORK
Habituality Test: Manufacturing upon special order for customers
Manufacturing in the ordinary course of business
Art. 1467: Art 1467:
Delivery of piece of article which venin ordinary If goods are to be manufactured specially for the
course of his business manufactures or procures for customer upon his special order, and not in general
the general market, whether on hand or not market.
Obligation to give Obligation to do
Subject matter: real obligation Subject Matter: service rendered
Remedy: Action for Specific Performance Remedy: cannot be subject to specific performance
*not governed by statute of frauds
SALE vs. AGENCY
Not unilaterally revocable Essentially revocable by principal
Buyer binds himself pays for the subject- his main Agent not obligated to pay the price, merely
obligation. obliged to deliver price he may receive from buyer.
Seller warrants. Agent assumes no personal liability as long as he
acts within authority and in the name of the
principal.
Seller receives personal profit from the sale. Agency is fiduciary relationship and thus the agent
is disqualified from receiving personal profit.