REVIEWER TLC SALES

Rodriguez vs Sps Sioson

What was the contract? A contract to sell, Neri agreed to sell the lot to Thelma on the
condition that title shall pass upon full payment of purchase price. The full payment will
allow the issuance of deed of absolute sale. Thus, because petitioner did not pay the
purchase price, the sale is not fulfilled as ownership is not vested even if there was
initial payment or possession
ACE FOODS INC vs Micropacific Technologies
ACE foods agreed to buy MTC’s computer. Ace foods state that there is a
contract to sell. What contract was entered?
Being consensual, it is contract of sale. From moment Ace foods accepted the proposal
of buying the products and to pay the purchase price between 30 days is a contract of
sale. There was already a delivery, thus there is transfer of ownership.
Sacobia Hills vs TY
In contract to sell art 1191 is not applicable. There is still no contract perfected.
However, he can ask for cancellation of the contract or withdraw his investment.
Contract of Sale vs Contract of Agency to Sell
NB
Contract of Sale vs Contract of Piece of Work
Sale vs Barter
Sale vs Lease
Sale vs Dacion En pago
Racelis vs Spouses Javier
SC Held: In a contract to sell, the payment of of earnest money represents the seller’s
opportunity cost of holding abeyance the search for other buyers or better deals. Absent
proof of a clear agreement to the contrary, it should be forfeited if the sale does not
happen without the seller’s fault. The potential buyers bears the burden of proving that
the earnest money was intended other than as a part of the purchase price and to be
forfeited if the sale does not occur without seller’s fault.
NB: in this case the earnest money of 78k was termed as a “goodwill money”
Oppurtunity cost is defined as the cost of the foregone alternative
Earnest money vs Option Money
Right of First Refusal
Sale by Sample- Seler warrants that the bulf of the goods shall correspond with the
sample in kind, quality and character
By description
Badilla vs Bragat
Even if there is no full payment yet, if contract of sale, the constructive delivery transfers
ownership already.
Industrial Corp vs Associated Brokerage
Was there delivery of bulk bags despite failure to comply with instructions. G and
L stated that there was no following of instruction, no delivery.
SC said there was a delivery. The vendor is bound to transfer ownership and deliver the
thing. Eben if it did not follow purchase order, there ws delivery. The guard-on-duty
even let them enter. If ther are wary, such should be resolved on the first delivery.
Instead mister Trinidad even allowed the first bulk bags.
Equitable vs Palces
A loan contract with an accessory chattel mortgage is not covered by Recto law, only
contract of sale of personal property in installments. Art 1484 not applicable
Recto and Maced law-codal
Gatchalian vs Angeles
Accdg to Gatchalian, they gave angeles 12 notices and 51 months grace period.
They gave notice of notarial rescission and angeles received it.
SC, there is no valid rescission. Twin requirements of notarized notice of cancellation
AND refund of the cash surrender value. The actual cancellation can only be done upon
expiry of 30 day period following the receipt by the buyer of the notice of cancellation
ART 1490 prohibitions
Obligations of the conracting party
1.1495- transfer ownership
2. deliver accessions
3.Warrant against evictions and hidden defects
4. Take care of the thing pending delivery
5. pay for expenses of the deed of sale, unless stipulated (1487 (5))
Vendee
1. Accept delivery
 2. Pay the price

Place of delivery
Time of Delivery
Payment of the Price
Goods Delivered to Buyer “On sale or return” or on trial/ on approval/ on satisfaction
Sps pudadera vs Magallanes
The law requires that the second buyer must have acquired the property in gf. Based on
prior tempore, prior jure
Roque vs Aguado April 2014
Reqs of 1544
In this case, the contract is based on contract to sell and not contract of sale as the
seller promise to execute a DAD upon completion by the buyer of the purchase price
Cabigas vs Limbaco
One who buys from reg owner not registered is expected to examine not only certificate
of title but all factual circumstance if there are flaws. Thus, if did not inquire, considered
void contract of sale.
Heirs of SArili vs Lagrosa
Victorino Sarili bought from Ramon Rodriguez but the CT is named Pedro lagrosa. Are
they buyers in GF?
No. higher degree of prudence is required from one who buys a person who is not
registered. One has the ascertain the identity of the person selling
Suntay vs Keyser
Bayfront failed to deliver the condo units to Suntay. HURB ordered the rescission
of the sale and refund purchase price. Were Sps Suntay purchasers of GF?
Yes, any buyer or mortgagees of realty covered by torens title is not obligated to look
beyond the title to investigate the seller. In the case at bench, the title had no liens. It
was a clean title. They did not know it was owned by another. The registration is the
operative act to convey and affect the land insofar as third persons are concerned.
Florentino Vs Leong
Elena, possessor constructed on a property owned by Florentino and Carmelita.
The two immigrated to USA and Florentino conveyed all rights to Quiapo
property. Carmelita sold the property to Edna. TCT was transferred to Edna’s
name. Florentino asked for nullity of contract. ISSUE: WON is GF?
Yes. GF presumed as no substantiation of fraud. Respondent did not rely on clean title
alone as there was possession of a third person. Thus she also relied on the waiver and
verified authenticity in RD. Thu res is a innocent purchaser for value.
Warranty
Equitable Mortgage
Solitarios vs Jaque
The transaction was a mortgage. It was never denied by respondents that Spouses
Solitarios remained in possession of subject property for 17 yrs and exercise acts of
ownership. To allow transfer of the lot to Jaques would amount to condoning the
prohibited pactum commisorium which provides that the creditor cannot appropriate or
consolidate ownership over a mortgaged property upon failure to pay debt
LEASE
-one by virtue of which 1 person binds himself to grant temporarily the use of a thing to
render service to another who undertakes to pay some rent, compensation or price.
Assignment of Lease- consent of lessor is required unless stipulated
Mortgage of Lease right, no consent of lessor
To bind 3rd persons- lease must be recorded in Reg of Property
Sublease- allowed unless expressly prohibited;
Sublessee is subsidiarily liable to lessor:
1. All acts which refer to the use and preservation of the thing leased in the manner
stipulated between lessor and lessee. EX: the lessor cannot allow the sublesse
to change the use lie from residential to a business place
2. Any rent due from the lesse BUT sublessee shall not be responsible from amount
beyond what is due from him under the terms of sublessee at time of EJ demand.
Obligations of Lessor
1. Deliver the object of the lease ffit for use- cannot alter form of the thing
2. Make necessary repairs to keep it suitable for use intended unless contrary
3. Maintain peaceful and adequate enjoyment of the for the entire duration of the
contract
a. Only legal disturbance- no obligation to answer for a mere act of trespass,
when 3rd person claims no right against the other other
Obligations of the Lessor
 1. Pay the rent;
2. Use the thing leased as DFOAF, devoting it to the use stipulated; absence of
stipulation- that which may be inferred from the nature of the thing
leased,according to customs
3. Pay expenses for the deed of Lease
4. Notify the lessor, within the shortest time possible, of any usurpation or untoward
act of any 3rd person upon the thing leased
5. Notify lessor withs same urgency as early as possible for necessary repairs
*In both no 4 and 5, there should be damages in favor of lessor
*if lessor fails to make urgent repairs, lessess may order repairs at lessor’s
cost
6. Return the thing leased at termination of contract as whne he received it save what is
lost by ordinary wear and tear
Law presumes it was received in good condition unless proof of contrary
Lessee is responsible for the deterioration/loss of the thing leased unless he
proves he is not at fault
Burden of proof does nota apply when destruction is act of God
Lessee is liable for deterioration because of members of household and guests
Ex: permanent markers sa walls, they are liable for such

Lesse may suspend payment of rent in case lessor fails to

1. Make necessary repairs
2. Maintain lessee a peaceful and adequate enjoyment of the leased property.
However, non-payment of rent for 3 months shall mean cancelattion of rent
Non-compliance by lessor or lessee of obligations, aggrieved party may:
1. Rescission of contract and
2. Indemnification for damages or
3. Damages only, allowing contract be in force
Termination of Lease
1. Expiration lof contract
a. If lease was made for a definite time, it ceases upon day fixed without
need of demand
2. Total destruction of the thing leased by a fortuitous event
a. Partial destruction- lessee may choose between: proportional reduction of
the rent; rescission of lease
Tacita Reconducion- implied new lease
Reqs: ART 1670
Original Lease Contract has expired
Lessee continues possession of the thing for 15 days
Possession of Lessee was with acquiescence of lessor
No notice to the contrary has been previously given
Characteristic of new lease
1. Period of the new lease is the time established in Art 1682 and 1687 NCC and
not for period of original contract
a. If rural land if period not fixed, understood to have been made for all the
time necessary for gathering of the fruits which yields in 1 year
b. If urban area, if period of the lease is not fixed
i. Year to year- annual payment of rent
ii. Month to month- monthly payment
iii. Week to week- weekly rent
iv. Day0to day- daily rent
Even though a monthly rent is paid, courts may fix a longer term after lessee has
occupied premises after a year
If rent is weekly, courts may extend period after in possession of 6 mts
If daily- extend if possession for 1 month
2. Terms of the original contract shall bee revived but not incidental provisions
3. Obligation contracted by 3rd person for the security of the principal contract shall
cease- the surety or guarantor is released
Causes for Judicial Ejectment
1. Expiration of period
2. Non-payment of rent stipulated
3. Violation of any conditions agreed upon contract
4. Devoting the use of any service not stipulated which causes deterioration
Malayan Realty Inc vs Alberto DEE
If no monthly period is paid and no period of lease has been set, courts may fix a longer
term for the lease until lessee has occupied the lease for a longer period. In case at bar,
a written notice was given January 17,2001 termination the lease effective August 31,
2001. As respondent was notified of the expiration of the lease, effectively has the right
to stay in the premises had come to an end on Aug 31 2001. In this case, respondent
has remained in possession of 5 years as extended period. Such is deemed sufficient
as an extension and for him to find another place to stay so not anymore renewed

Sale of thing leased:

1. If the lease is not recorded in Reg of property, buyer may terminate the lease
except:
a. There is stipulation
b. Buyer knows the existence of the lease
i. If the buyer terminates the contract of lease, the lessee may
demand that;
1. He be allowed to gather the fruits of the harvest which
corresponds to the current agricultural year
2. The vendor indemnify him for damages suffered
ii. If sale is fictitious, vendee cannot terminate the contract
1. Presumed fictitious if at time vendee demands termination,
sale is not recorded in reg of prop
2. If sale is with right of repurchase, the buyer cannot eject lessee until end of
redemption period
If lessee makes in GF Useful improvements, without altering form or substance, upon
termination of the lease, the lessor shall
Pay the lessee ½ of the value of improvements or
Allow the lessee to remove even though principal may suffer damage. Lessee
shall not cause any impairment than necessary.
Ornamental expenses
1. No reimbursement
2. May remove the ornamental objects provided no damage is caused to principal
thing and the lessor does not choose to retain them by paying their value at time
the elase is extinguished