Delivery of the thing sold
When goods are in the possession of a third person who
Read: Arts. 1497 – 1503, 1521, 1523, 1524, 1536, 1537, 1539 –
1543, 1597, 1598
SECTION 2. DELIVERY OF THE THING SOLD.
Art. 1497. The thing sold shall be understood as delivered, when it is
placed in the control and possession of the vendee.
METHODS OF DELIVERY
There are four methods of delivery;
1. ACTUAL DELIVERY – Art. 1497 provides that “The thing sold
shall be understood as delivered, when it is placed in the
control and possession of the vendee”. This article
contemplates what is known as real or actual delivery. If the
thing sold is movable, the actual delivery takes place by
handing it over to the buyer.
2. CONSTRUCTIVE DELIVERY – The delivery takes place in
another manner which is indicative of the intention to
deliver the thing for the purpose of transferring ownership
thereof, which includes the following:
a. Delivery by the execution of a public instrument
b. Traditio Symbolica
c. Traditio longa manu
d. Traditio brevi manu
e. Traditio constitutum possessorium
f. Delivery through a carrier or courier
g.
acknowledges that he holds them on behalf of the
buyer.
3. QUASI-TRADITION – The delivery of rights, credits or
incorporeal property is made by:
a. Placing titles of ownership in the hands of buyer; or
b. Allowing buyer to make use of the right.
4. TRADITION BY OPERATION OF LAW – A good example of
this method of delivery is Article 1434 of the civil code,
which declares: “When a person who is not the owner of a
thing sells or alienates and delivers it, and later the seller or
grantor acquires title thereto, such title passes by operation
of law to the buyer or grantee.”
KINDS OF CONSTRUCTIVE DELIVERY/QUASI-TRADITION DELIVERY
“ON SALE OR RETURN” AND/OR DELIVERY “ON APPROVAL OR
TRIAL”
I. Sale made through a public instrument
Art. 1498. When the sale is made through a public instrument, the
execution thereof shall be equivalent to the delivery of the thing
which is the object of the contract, if from the deed the contrary
does not appear or cannot clearly be inferred.
With regard to movable property, its delivery may also be made by
the delivery of the keys of the place or depository where it is stored
or kept.
GENERAL RULE: The execution of a public instrument amounts to a
constructive delivery of the thing subject of a contract of sale.
 - Chua vs CA – the court stated that when the deed of
absolute sale is signed by the parties and NOTARIZED, then
the delivery of the real or personal property is deemed
made by the seller to the buyer.
- A stipulation requiring otherwise is not prohibited by law
and cannot be regarded as violative under morals, good
customs, public order or public policy.
Under Article 1306 of the civil code “The contracting parties
may establish such stipulations, clauses, terms and conditions as
they may deem convenient, provided they are not contrary to
law, morals, good customs, public order, or public policy.”
EXCEPTIONS:
1. When the contrary is provided in the public instrument
- When the sale is made through a public instrument, the
execution thereof shall be equivalent to the delivery of the
thing which is the object of the contract, if from the deed
the contrary does not appear or cannot clearly be inferred.
In other words, there is symbolic delivery of the property
subject of the sale by the execution of the public
instrument, UNLESS FROM THE EXPRESS TERMS OF THE
INSTRUMENT, OR BY CLEAR INFERENCE THEREFROM, THIS
WAS NOT THE INTENTION OF THE PARTIES.
- Such would be the case, for instance, where the vendor has
no control over the thing sold at the moment of the sale,
and therefore, its material delivery could not have been
made.
2. When mere presumptive and not conclusive delivery is
created in cases where the buyer fails to take material
possession of the subject of sale.
- Execution of the deed of sale is only prima facie
presumption of deliver. The rationale of this exception is
that a person who does not have actual possession of the
thing sold cannot transfer constructive possession by the
execution and delivery of a public instrument.
- Thus, it has been held that while the execution of a public
instrument of sale is recognized by law as equivalent to the
delivery of the thing sold, such constructive or symbolic
delivery, being merely presumptive, is deemed negated by
the failure of the vendee to take actual possession the land
sold.
II. TRADITIO SYMBOLICA – with regard to movable
property, its delivery may also be made by the delivery
of the keys of the place or depository where it is stored
or kept. The parties make use of a token or symbol to
represent the thing sold.
Examples:
o The seller is handing over to the buyer the key of
the car or storage
o The seller is negotiating to the buyer a document of
title to the thing.
(S sells to B goods of which he has the bill of lading
which is deliverable to his order, and he endorses
and delivers it to B)
Art. 1499. The delivery of movable property may likewise be made
by the mere consent or agreement of the contracting parties, if the
thing sold cannot be transferred to the possession of the vendee at
the time of the sale, or if the latter already had it in his possession
for any other reason.
III. TRADITIO LONGA MANU
“The delivery of movable property may likewise be made by the
mere consent or agreement of the contracting parties, if the thing
sold cannot be transferred to the possession of the vendee at the
time of the sale”
- This means that parties may agree for a specific manner of
delivery other than actual delivery. Consent to this kind of
delivery may be expressed or implied.
Examples:
o The seller is setting side the thing from the rest for
the buyer.
(earmarks of a cow/from removing sacks of rice to
the barn/ simply in the buyer’s presence, is pointing
to the things which are delivered, which at that time
must be in plain view)
IV. TRADITIO BREVI MANU – The buyer already had the
thing sold in his possession at the time of the sale for
any other reason. Hence, he simply retains or continues
to possess the thing or premises but now in the concept
of an owner. It is probable that at the time of the buyer
bought the property, he was already in possession of it
as a lessee or usufructuary.
Examples: if the lessee buys the apartment unit he is
leasing from his lessor; he now possesses it as the
owner thereof.
V. TRADITIO CONSTITUTUM POSSESSORIUM –
Art. 1500. There may also be tradition constitutum possessorium.
The traditio constitutum possessorium is the reverse of the traditio
brevi manu. If in the latter, the buyer continues his possession in the
concept of an owner; in traditio constitutum possessorium, the
seller continues his possession of the determinate thing – no longer
in the concept of an owner but under a different title or in a
different capacity.
Example: the owner-seller retains or continues to possess the
premises as a lessee after he sold it to the buyer.
IV. QUASI-TRADITION (Delivery of incorporeal property)
Art. 1501. With respect to incorporeal property, the provisions of
the first paragraph of article 1498 shall govern. In any other case
wherein said provisions are not applicable, the placing of the titles
of ownership in the possession of the vendee or the use by the
vendee of his rights, with the vendor's consent, shall be understood
as a delivery.
INCORPOREAL PROPERTY – is an intangible thing which a person
can have an ownership of, and which he can likewise transfer to
another person.
Examples: Goodwill, company brand, credit, and property rights.
Art. 1501 provides for the manner by which an incorporeal property
may be delivered. The first recognized method of delivery is the
execution of the public instrument which contains the sale of
incorporeal property, as provided under Art. 1498.
If the execution of the public instrument is not applicable, the
second sentence speaks of QUASI-TRADITION wherein the delivery
of incorporeal property may be made by:
a. Placing titles of ownership in the hands of buyer
b. Allowing the buyer to make use of the rights.
VI. DELIVERY “ON SALE OR RETURN” AND/OR DELIVERY
“ON APPROVAL OR TRIAL”
Art. 1502. When goods are delivered to the buyer "on sale or
return" to give the buyer an option to return the goods instead of
paying the price, the ownership passes to the buyer of delivery, but
he may revest the ownership in the seller by returning or tendering
the goods within the time fixed in the contract, or, if no time has
been fixed, within a reasonable time.
When goods are delivered to the buyer on approval or on trial or on
satisfaction, or other similar terms, the ownership therein passes to
the buyer:
(1) When he signifies his approval or acceptance to the
seller or does any other act adopting the transaction;
(2) If he 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. What is a
reasonable time is a question of fact.
ON SALE OR RETURN
When goods are delivered to the buyer "on sale or return" to give
the buyer an option to return the goods instead of paying the price,
the ownership passes to the buyer of delivery, but he may revest
the ownership in the seller by returning or tendering the goods
within the time fixed in the contract, or, if no time has been fixed,
within a reasonable time.
- Examples: A shoe manufacturer delivers his shoes to a
retailer with understanding that the latter may opt to
regard some or all of the shoes delivered as merely a
consignment and return them within a fixed or reasonable
time. The sale between the shoe manufacturer and the
retailer is consummated with regard to the shoes that are
retained.
SALE ON APPROVAL OR TRIAL
When goods are delivered to the buyer on approval or on trial or on
satisfaction, or other similar terms, the ownership therein passes to
the buyer:
 (1) When he signifies his approval or acceptance to the
seller or does any other act adopting the transaction;
(2) If he 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. What is a
reasonable time is a question of fact.
In short, a sale on approval or trial is one wherein title to the thing
delivered passes only when the buyer signifies his approval or
acceptance thereof to the seller, or when a reasonable time expires.
If the buyer is not satisfied with the thing delivered, he may return it
to the seller.
VII. DELIVERY THROUGH A CARRIER OR COURIER
Art. 1503. When there is a contract of sale of specific goods, the
seller may, by the terms of the contract, reserve the right of
possession or ownership in the goods until certain conditions
have been fulfilled. The right of possession or ownership may be
thus reserved notwithstanding the delivery of the goods to the
buyer or to a carrier or other bailee for the purpose of
transmission to the buyer.
Where goods are shipped, and by the bill of lading the goods are
deliverable to the seller or his agent, or to the order of the seller
or of his agent, the seller thereby reserves the ownership in the
goods. But, if except for the form of the bill of lading, the
ownership would have passed to the buyer on shipment of the
goods, the seller's property in the goods shall be deemed to be
only for the purpose of securing performance by the buyer of
his obligations under the contract.
Where goods are shipped, and by the bill of lading the goods are
deliverable to order of the buyer or of his agent, but possession
of the bill of lading is retained by the seller or his agent, the
seller thereby reserves a right to the possession of the goods as
against the buyer.
Where the seller of goods draws on the buyer for the price and
transmits the bill of exchange and bill of lading together to the
buyer to secure acceptance or payment of the bill of exchange,
the buyer is bound to return the bill of lading if he does not
honor the bill of exchange, and if he wrongfully retains the bill
of lading he acquires no added right thereby. If, however, the
bill of lading provides that the goods are deliverable to the
buyer or to the order of the buyer, or is indorsed in blank, or to
the buyer by the consignee named therein, one who purchases
in good faith, for value, the bill of lading, or goods from the
buyer will obtain the ownership in the goods, although the bill
of exchange has not been honored, provided that such
purchaser has received delivery of the bill of lading indorsed by
the consignee named therein, or of the goods, without notice of
the facts making the transfer wrongful.
GENERAL RULE: Delivery of the goods to a carrier or courier is
deemed to be a delivery of the goods to the buyer.
EXCEPTIONS: transporting them to a consignee or person who has a right
to receive them, who is usually the buyer.
1. The contrary intention appears
B. COMMON CARRIER – common carriers are persons,
2. The seller reserves the right of possession or ownership
corporations, firms or associations engaged in the business
in the goods until certain conditions have been fulfilled.
of carrying or transporting of passengers or good or both, by
3. Based on the Bill of Lading, the goods are deliverable to
land, water, or air, for compensation, offering their services
the seller or his agent, or to the order of the seller or of
to the public.
his agent.
4. Based the Bill of Lading, the goods are deliverable to
order of the buyer or of his agent, but possession of the
bill of lading is retained by the seller or his agent.

ILLUSTRATION OF DELIVERY THROUGH A CARRIER OR COURIER

SELLER/CONSIGNOR/SHIPPER

CARRIER/COURIER/FREIGHT FORWARDER

ARRASTRE AND STEVEDORING OPERATOR

BROKER/TRUCKING

BUYER/CONSIGNEE

A. SELLER – the seller is the one who binds himself to transfer

ownership of, and deliver a determinate thing in exchange
for a price certain. Th consignor or shipper, who is usually
the seller, delivers the goods to a carrier or courier for