Art.
1458
 Through contract of sale, one
of the contracting parties
obligates himself to transfer
the ownership of and to deliver
a determinate thing and the
other to pay therefore a price
certain in money or its
equivalent
 May be absolute of conditional
Characteristics
 Consensual – perfected by
consent
 Bilateral – both parties are
bound to fulfill obligations
reciprocally (seller-deliver,
buyer-pay)
 Onerous – thing sold is
conveyed in consideration of
the price
 Commutative – thing sold is
considered the equivalent of
the price paid and vice versa
 Nominate – special
designation in the civil code
 Principal – validity and
existence does not exist on
another contract
Essential requisites of a contract of
sale
 Consent or meeting of minds
– seller to transfer and deliver,
buyer to pay
o Parties must have legal
capacity
o Acceptance of
payment is an
indication of his
consent to a contract
o Sales against will of
owners 
expropriation of
property, execution of
sale to enforce
judgment of a court,
foreclosure sale of
mortgage or pledged
property
 Object or subject matter –
determinate thing which is
the object of the contract,
capable of being made
determinate, real or personal
property
 Cause or consideration – price
certain in money or its
equivalent
Natural and accidental elements
 Natural – deemed to exist in
certain contracts
 Accidental – may be present of
absent depending on the
stipulations of the parties
Kinds of contract of sale
 Absolute – sale is not subject
to any condition, title or
ownership passes to the buyer
upon delivery of the thing sold
 Conditional – sale
contemplates a contingency,
contract is subject to certain
conditions (full payment of
purchase price) to which the
transfer of ownership is not
fulfilled until the condition is
fulfilled
Art. 1459
- thing must be licit and vendor
has the right to transfer
ownership thereof at the time
it is delivered
Requisites concerning objects
 things – determinate,
licit/lawful, not be impossible
o within the commerce of
men (outside- public
ownership)
 o illicit  contract
void, cant be ratified
 rights – rights which are not
intransmissible or personal
may be object of sale (right of
usufruct, right of conventional
redemption) services may not
be object of the contract of
sale
o rights intransmissible
by law – right to vote,
right to public office
Kinds of illicit things
 illicit per se (of its nature)
 per accidens – some provisions
of the law declaring its illegal
Right of vendor to transfer ownership
 one can sell only what he owns
 sufficient if right exists at time
of delivery – does not require
the vendor to have the right to
transfer ownership at the time
of the perfection of the
contract
Art. 1460
- determinate – particularly
designated or physically
segregated from all others of
the same class
- time the contract is entered
into, the thing is capable of
being made determinate
without the necessity of a new
or further agreement between
the parties
Subject matter must be determinate
 when thing is determinate –
physically segregated from all
others of the same class
o object of the contract
of sale must be
determinate
o determinate thing is
identified by its
individuality
o not necessary the thing
sold must be in sight at
the time the contract is
entered into
 sufficient if subject matter is
capable of being made
determinate
Art. 1461
- having potential existence may
be subject of the contract of
sale
- efficacy of sale of mere hope
or expectancy is subject to the
condition that the thing will
come into existence
- sale of a vain hope or existence
is void
Art. 1462
- Future goods - existing goods
owned or possessed by the
seller or goods to be
manufacture, raised, or
acquired by the seller after the
perfection of the contract
- There may be a contract of
sale of goods whose
acquisition by the seller
depends upon a contingency
which may or may not happen
Goods which may be the object of sale
 Existing goods – goods owned
or possessed by the seller
 Future goods – goods to be
manufactured, raised, or
acquired
Future goods as object of sale
 Valid only as an executor
contract to be fulfilled by the
acquisition and delivery of the
goods specified
  Does not apply if the goods are
to be manufactured especially
for the buyer (contract for a
piece of work, Art. 1467)
Art. 1463
- sole owner of a thing may sell
an undivided interest therein
Sale of undivided interest in a thing
 by sale owner – sole owner
may sell the entire thing or
only a specified portion
thereof or an undivided
interest therein.
o Effect of sale of an
undivided thing – make
the buyer to co-owner
in the thing sold
o Full ownership of his
part and he may sell it
(limited to the portion
which may be allotted
to him)
 By co-owner – he can dispose
of his share even without the
consent of the other co-
owner/s
Art. 1464
- in case of fungible goods,
there may be a sale of an
undivided share of a specific
mass (definite number, weight
or measure of the goods in the
mass)
- buyer becomes owner in
common of such share
- If the mass contains less than
the number, weight, or mass
bought, the buyer becomes
the owner of the whole mass
and the seller is bound to make
good the deficiency from
goods of the same kind and
quality, unless contrary intent
appears
Sale of an undivided share of a specific
mass
 Fungible goods – any unit is
treated as the equivalent of
any other unit (grain, oil, wine,
gasoline, etc.)
 Effect of sale – owner may sell
only an undivided share
thereof, provided the mass is
specific or capable of being
made determinate
o Buyer becomes a co-
owner with the seller of
the whole mass
o Less than what is sold –
seller shall supply
whatever is lacking
from goods of the same
kind and quality,
subject to any
stipulation to the
contrary
 Risk of loss – if buyer becomes
the co-owner, it follows that
the whole mass is at the risk of
loss of all the parties interested
in it
 Subject matter – subject
matter is an incorporeal or
intangible right
o Ownership passes to
the buyer by the
intention of the parties
Art. 1466
- essential clauses of the whole
instrument shall be considered
when construing a contract
containing provisions
characteristics of both the
contract of sale and the
contract of the agency to sell
sale vs agency to sell
 agency – person binds himself
to render some service or to do
something in representation or
 on behalf of another, with the
consent or authority of the
latter
 sale – buyer receives the goods
as the owner. Agency – agent
receives the goods of the
principal who retains his
ownership over them
 sale – buyer has to pay the
price, agency – agent has to
account for the proceeds of
the sale he may make on the
principal’s behalf
 sale – buyer cannot return the
object sold, agency – agent
can return the object in case he
is unable to sell the same to a
third person
 sale – seller warrants the thing
sold, agency – agent makes no
warranty for which he
assumers personal liability as
long as he acts within his
authority and in the name of
the seller
 sale – buyer can deal with the
thing sold as he pleases,
agency – agent must act and is
bound according to the
instructions of his principal
Art. 1467
- contract of sale – contract for
the delivery at a certain price
of an article which the vendor
in the ordinary course of his
business manufactures of
procures for the general
market
- contract for a piece of work –
manufactured specially for the
customer and upon his special
order
Sale vs piece of work
 contract for piece of work –
contractor binds himself to
execute a piece of work for the
employer, contractor may
either employ his labor or skill,
or also furnish the material
 contract for work – object of
contract is one not in existence
and which never would have
existed but for the order of the
party desiring to acquire it, risk
of loss before delivery is borne
by the worker or contractor,
not within statute of frauds
 contract of sale – loss before
delivery is borne by the buyer
Art. 1468
- if considerations consists
partly in money and partly in
another thing, the transaction
shall be characterized by the
manifest intention of the
parties
- it shall be considered a barter
if the value of the thing given
as a part of the consideration
exceeds the amount of the
money or its equivalent,
otherwise it is a sale
contract of barter or exchange
- one of the parties binds
himself to give one thing in
consideration of the other’s
promise to give another thing
contract of sale
- vendor gives a thing in
consideration for a price in
money
- price certain in money or its
equivalent
when distinction cannot be
determined
- manifest intention of the
parties is paramount
 - such intention may be
ascertained by taking into
account the contemporaneous
and subsequent acts of the
parties
- if intention cannot be
ascertained, last sentence of
the art. applies
Art. 1475
- contract of sale is perfected a
the moment there is a meeting
of minds upon the thing which
is the object of the contract
and upon the price
- from that moment, parties
may reciprocally demand
performance
Perfection of the contract of sale
- contracts are perfected by
mere consent
- perfected without the
necessity of any other
circumstance
- ownership is not transferred
until delivery of the of the
thing
- injured party may sue for the
fulfillment or rescission with
the payment of damages
effect of failure to pay price/absence
of price
 price stipulated – demand
specific performance or
rescission with damages in
either case
 no price stipulated – sale is
void and non-existent
Art. 1476
- each lot is subject to separate
contract of sale
- perfected when auctioneer
announces its perfection by
the fall of the hammer, until
announcement is made, bidder
may retract his bid and
auctioneer may retract his
goods unless the auction has
been announced to be without
reserve
- a right to bid may be reserved
expressly by or on behalf of the
seller
- where notice has not been
given that a sale by auction is
subject to a right to bid of
behalf of seller, it shall not be
lawful for the seller to bid
himself or to employ or induce
any person to bid at such sale
on his behalf or for the
auctioneer to employ any
person to bid on behalf of the
seller
Rules governing auction sales
 sales of separate lots by
auction are separate sales –
separate contract in regard to
each lot , parties may
subsequently consolidate all
the purchases into one
transaction
 sale perfected by the fall of the
hammer – bidder may retract
his bid and auctioneer may
withdraw his goods anytime
before the fall of the hammer
 right of seller to bid in the
auction
o such right was reserved
o notice was given that
the sale is subject to bid
on behalf of the seller
o right to bid by the seller
is not prohibited by the
law or stipulation
 where no notice
was given of
right to bid –
unlawful for the
 seller to bid
directly or
indirectly
 prevent puffing
or secret
bidding
 notice was
given of right to
bid – secrecy of
puffing renders
it a fraud upon
bidding
Art. 1479
- promise to buy and sell a
determinate thing for a price is
reciprocally demandable
- accepted unilateral promise to
buy or to sell a determinate
thing for a certain price is
binding upon the promisor if
the promise is supported by a
consideration distinct from the
price
kinds of promise treated in art. 1479
 accepted unilateral promise to
sell in which the promisee
elects to buy
 accepted unilateral promise to
buy in which the promisee
elects to sell
 bilateral promise to buy and
sell reciprocally in which either
of the parties chooses to exact
fulfillment
effect of unaccepted unilateral
promise – no juridical effect or legal
bond (policitation)
option – privilege existing in one
person for which he has paid a
consideration which gives him the
right to buy/sell
effect of accepted unilateral promise –
a consideration distinct and separate
from the price will give rise to a
perfected contract
effect of bilateral promise – perfected
contract (consent from both parties)
Art. 1483
- a contract of sale may be in
writing, or by word of mouth,
or partly in writing and partly
by word of mouth, or may be
inferred from the conduct of
the parties
- subject to the provisions of the
statute of frauds
Form of contract of sale
 general rule – form of contract
refers to the manner in which
it is executed of manifested
 where contract is covered by
the statute of frauds – law
requires that it be in writing
subscribed by the party
charged, otherwise, contract
cannot be enforced by action
 applicable statute – required
for must be observed in order
that the contract may both be
valid and enforceable
 accdg to the statute of frauds,
the ff contracts must be in
writing
o sale of real property at
a price not less than
P500
o sale of real property or
an interest therein
regardless of price
involved
o sale or property not to
be performed within a
year from date thereof
regardless of the nature
 of the property and the
price involved
 where form is required only for
the convenience of the parties
– the sale may be registered in
the registry of deeds to make
effective as against third
persons the right acquired
under such sale

sale of real property

 sale of a piece of land or
interest therein when made
through an agent is void unless
the agent’s authority is in
writing
 sale must be registered in the
registry of deeds
 sale must be in a public
instrument or document
 sale of land in a private
instrument is valid as between
the parties but it cannot be
registered to bind or affect
third persons

statute of frauds applicable only to

executor contracts