BM1808

TASK PERFORMANCE

I. CONTRACT RECOGNITION TASK

For the following scenarios, determine the status of the contract entered into. Write the letter of the
correct answer on the space provided before each number. (20 items x 2 points)

A. Perfectly Valid
B. Rescissible
C. Voidable
D. Unenforceable
E. Null and void

Rescissible Voidable Unenforceable Void

Contracts validly agreed Defect is caused by vices Those that do not Defect is caused
upon but, by reason of of consent. comply with the by lack of essential
lesion or economic Statute of Frauds. elements or illegality.
prejudice may be One of the contracting
rescinded in cases parties is incapacitated. Both parties are
established by law. incapacitated.

Defect is caused by Those entered into in

injury/ damage either the name of another by
to one of the parties of one without or acting in
to a 3rd person excess of authority.

Comparative Table of Defective Contracts

1. A, minor, sold in writing his ball pen for P1,000 to B, a capacitated person. The book value of the ball
pen is P1,500 so A suffered lesion by more than ¼ the value of the thing which is the object thereof.

2. G, guardian of minor M, sold in writing the house and lot of Mat a selling price of P7,000,000 when
its book value is P10,000,000. The sale is without prior approval of guardianship court.

3. On January 1, A, the guardian of X, orally sold a phone of X in X’s name to J, a minor, at a selling price
of P749 when its book value is P1,000. The payment is to be made on February 2 while delivery is to
be made on March 1.

4. S orally sold a piece of land to B in the amount of P200,000 payable in four (4) installments. B
already paid a consideration of P50,000 representing the first installment.

5. A, agent of P, orally sold the land of P in P’s name to B. The authority of A is not in writing and B
has already paid the whole purchase price to A.

6. A, a minor, orally sold the cell phone of his brother at a selling price of P500. The buyer, an
insane person, already paid P100 of the selling price to A.

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7. A orally entered a contract for a piece of work of cake at a price of P500. The performance and
payment of price shall be done after five (5) months.

8. S orally entered into a contract of barter with B involving a cell phone and a laptop. The values of
the cell phone and laptop are P5,000 and P15,000, respectively. The exchange will happen after six
(6) months.

9. A mother sold two (2) fishponds to her daughter and the latter, in turn, resold the same fishponds
to her stepfather.

10. A Filipino leased a parcel of land to a foreigner for 99 years with an option to buy the property
within 50 years provided that the latter shall become a Filipino.

11. A written contract for a transfer of a piece of land at an amount of P500,000 with a fair market
value of P550,000. Delivery and payment have not yet been made.

12. The wife orally sold a land which is a community property to a third person without the consent
of the husband at a price of P60,000 when the book value is P100,000.

13. Oral contract of sale of a cell phone at a price of P400 but delivery and payment will be made after
15 months.

14. Oral contract of sale of a piece of land with a price of P499 but delivery and payment will be
made after one (1) month.

15. A written contract of sale of a piece of land at a price of P499 between a demented and an
insane person.

16. G, the guardian of M, a minor, orally sold M’s cell phone for P500 to I, an insane person. Delivery
and payment have not yet been made.

17. M, an insane person, orally sold prohibited drugs at a price of P1,000 when its book value is
P1,500, to I, an
insane person also. Delivery and payment have not yet been made.

18. An oral contract of sale of a cell phone at a price of P5,000 between husband and wife who are
covered by absolute community or conjugal property regime. Delivery and payment will happen
after two (2) months.

19. A written contract of sale of car at a price of P70,000 between husband and wife who are covered
by regime of absolute or complete separation of property. The husband pointed a gun to the wife
to sign the contract. Delivery and payment have not yet been made.

20. An oral contract of sale of forest land or national park at a selling price of P100,000,000 with
partial payment of P20,000,000.

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II. CASE ANALYSIS

Analyze the following cases and answer the questions that follow. (4 items x 10 points)

Case 1. Supposed sale was evidenced by a receipt acknowledging receipt of P1,000.

Facts: B bought on a partial payment of P1,000.00, evidenced by a receipt, a portion of a subdivision from S,
administrator of the testate estate of his deceased spouse. Subsequently, S was authorized by the court to
sell the subdivision. In the meantime, PT Co. became the new administrator. It sold the lot to another which
sale was judicially approved. B files a complaint which seeks, among other things, for the quieting of title
over the lot in question (Leabres vs. Court of Appeals, 146 SCRA 158 [1986]).

Issue: Was there a valid and enforceable sale to B?

Case 2. Vendor “sells, transfers, and conveys” a land to the vendee who may sell or assign the land prior to
full payment of all installments.

Facts: The dispositive part of a deed entitled “Deed of Sale of Real Property” states: “for and in consideration
of the sum of P140,000, payable under the terms and conditions stated in the foregoing premises, the
VENDOR sells, transfers and conveys unto the VENDEE x x x” the property in question as of December 22,
19XX, the date of said document.”

It is provided that “should the VENDEE prior to the full payment of all the amounts aforementioned, decide to
sell or to assign part or all of the aforementioned parcel of land, the VENDOR shall be informed in writing and
shall have the option to repurchase the property x x x. Should the VENDOR herein decide to repurchase, and
the property is sold or transferred to a third person, the balance of the consideration herein still due to the
VENDOR shall constitute automatically a prior lien on the consideration to be paid by the third person to
herein VENDEE.”

Issue: Is the above instrument a contract to sell?

Case 3. Some of the goods contracted to be sold were missing through fault of carrier.

Facts: S, a domestic corporation, alleges that B, a general partnership, refused to pay the price of various
automotive products, with the latter claiming that it had not received the merchandise. It appears that upon
receipt of the Bill of Lading, B initiated, but did not pursue, steps to take delivery as it was advised by NN
Company, owner of the vessel on which the spare parts were loaded by S’s forwarding agent, that because
some parts were missing, they would just be informed as soon as the missing parts were located. It was only
four (4) years later when a warehouseman of NN found in its bodega, parts of the shipment in question, but
already deteriorated and valueless.

Issue: Under the circumstances, can B be faulted for not accepting or refusing to accept the shipment from
NN four (4) years after shipment?

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Case 4. Machine purchased was in accordance with specifications in contract but did not give the result
expected by the buyer.

Facts: Under a contract of sale, S delivered and installed in B’s establishment a refrigerating machine. The
machine was in perfect accord with the description made in the contract, but it did not give the result
expected by B. S brought action to recover the balance of the purchase price.

Issue: Is B’s action in refusing to pay such balance justifiable considering that he could not use the machine
satisfactorily in his establishment?

Rubric for scoring:

CRITERIA PERFORMANCE INDICATORS POINTS
Content Provided pieces of evidence, supporting details, and factual 7
scenarios
Grammar Used correct grammar, punctuation, spelling, and 1
capitalization
Organization of Expressed the points in clear and logical arrangement of ideas 2
ideas in the paragraph
Total 10

Reference
De Leon, H. S. (2016). The law on Sales, agency and credit transactions. Manila: Rex Book Store.

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