Article 1521 RULES IN DELIVERY OF GOODS (PLACE):
1) According to that Agreed upon;
Whether it is for the buyer to take
possession of the goods or of the seller to send
them to the buyer is a question depending in each
case on the contract, express or implied, b/w the
parties. Apart from any such contract, express or
implied,
or usage of trade to the contrary, the place of
delivery is the seller's place of business if he has
one, & if not his residence; but in case of a contract
of sale of specific goods, w/c to the knowledge of
the parties when the contract or the sale was made
were in some other place, then that place is the
place of delivery.
Where by a contract of sale the
seller is bound to send the goods to the buyer, but
no time for sending them is fixed, the seller is
bound to send them w/in a reasonable time.
Where the goods at the time of
sale are in the possession of a third person, the
seller has not fulfilled his obligation to deliver to
the buyer unless & until such third person
acknowledges to the buyer that he holds the goods
on the buyer's behalf.
Demand or tender of delivery may
be treated as ineffectual unless made at a
reasonable hour. What is a reasonable hour is a
question of fact.
Unless o/w agreed, the expenses
of & incidental to putting the goods into a
deliverable state must be borne by the seller.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
2) In the absence of an agreement Usage of Trade;
3) Seller’s Place of business;
4) Seller’s Residence; Usage of trade- is any practice or method of dealing
5) For specific goods, where the said goods are Found having such regularity of observance in a place, vocation
(Paras Civil Code Book V, 2008)
or trade to justify an expectation that it will be observed
w/ respect to the transaction in question.
PRESUMPTION: The buyer must take the goods from the
seller’s place of business or residence rather than the seller
Ex. Appliance or machinery: delivered to the residence or
to deliver them to the buyer. place of business of buyer; car tires – delivered at the place
of business of seller (good luck ikaw magpalit ng goma ng
When the delivery was made not as stipulated & the buyer gulong mo); mambabalot, magtataho, street vendors –
accepted the goods w/o complaint, it is deemed that the
kung saan mo sila matitiempuhan.
buyer WAIVED his right against the seller’s failure to
deliver.
Course of dealing – is a sequence of previous conduct b/w
the parties to a particular transaction w/c is fairly to be
SOURCE: LAW ON SALES REVEIWER (kupdf.net) regarded as establishing a common basis of understanding
for interpreting their expressions & other conduct.
Explanation: there has been previous transactions b/w the
RULES IN DELIVERY OF GOODS (TIME): seller & buyer. There has been an established
1) The time stipulated or agreed upon - Time is of the understanding how delivery is to be conducted. That
essence: w/in the period stipulated - Time is NOT of the established understanding is the “course of dealing.”
essence: w/in a reasonable time (Deleon p.236)
2) The time is not stipulated - Time is of the essence: buyer Note: above examples & explanation need to be confirmed
cannot invoke time is of the essence unless he gives the seller if correct
sufficient notice of his intention to cancel delivery is not made SOURCE: LAW ON SALES REVEIWER (kupdf.net)
on or before a fixed time. - Time is NOT of the essence: w/in a
reasonable time (a question of fact; case to case basis)
HOUR OF DELIVERY: (speaks of the hour of the day) - A
question of fact; depends on kind of obli
DUTY OF SELLER: To prepare the good in a deliverable state
at his expense. In such state, the buyer is bound to accept
delivery. (unless o/w agreed)
SOURCE: LAW ON SALES REVEIWER (kupdf.net)

Article 1522
Where the seller delivers to the
buyer a quantity of goods less than he contracted to
sell, the buyer may reject them, but if the buyer
accepts or retains the goods so delivered, knowing
that the seller is not going to perform the contract
in full, he must pay for them at the contract rate. If,
however, the buyer has used or disposed of the
goods delivered before he knows that the seller is
not going to perform his contract in full, the buyer
shall not be liable for more than the fair value to
him of the goods so received.
Where the seller delivers to the
buyer a quantity of goods larger than he contracted
to sell, the buyer may accept the goods included in
the contract & reject the rest. If the buyer accepts
the whole of the goods so delivered he must pay for
them at the contract rate.
Where the seller delivers to the
buyer the goods he contracted to sell mixed w/
goods of a different description not included in the
contract, the buyer may accept the goods w/c are
in accordance w/ the contract & reject the rest.
In the preceding two paragraphs,
if the subject matter is indivisible, the buyer may
reject the whole of the goods.
The provisions of this art are
subject to any usage of trade, special agreement, or
course of dealing b/w the parties.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
DELIVERY OF GOODS LESS THAN THE QUANTITY
CONTRACTED:
- The buyer may reject delivery
- The buyer may accept delivery
- Know that seller would not complete delivery: Pay
contract price
- Does not know that seller will not complete delivery: Fair
value of the goods
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Note:
FAIR VALUE: not necessarily the market value; the benefit
DELIVERY OF GOODS MORE THAN THE QUANTITY
w/c the buyer may receive from the goods. Since the seller
CONTRACTED:
did not delivery the correct quantity as agreed upon, the
- Buyer may accept quantity contracted & reject the excess
buyer is not required to pay the contract price if such price
- Buyer may accept including the excess provided, he pays
is more than fair value to him
for their value
- If indivisible, buyer may reject the whole or accept it
1233. A debt shall not be understood to have been paid
entirely
unless the thing or service in w/c the obli consists has been
completely delivered or rendered, as the case may be.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
1235. When the obligee accepts the performance, knowing
its incompleteness or irregularity, & w/o expressing any
DELIVERY OF GOODS MIXED W/ OTHERS:
protest or objection, the obli is deemed fully complied w/.
- Buyer may accept those w/c are in accordance w/ the
contract & reject the rest
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
- Buyer may accept including that w/c are not in accordance
w/ the contract provided, he pays for their value
- If indivisible, buyer may reject the whole or accept it entirely
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
DELIVERY OF INDIVISIBLE GOODS WHETHER IN EXCESS OR
MIXED GOODS
-Buyer may reject the whole or accept it entirely
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
 Article 1523
Where, in pursuance of a contract
of sale, the seller is authorized or required to send
the goods to the buyer, delivery of the goods to a
carrier, whether named by the buyer or not, for the
purpose of transmission to the buyer is deemed to
be a delivery of the goods to the buyer, except in
the cases provided for in art 1503, first, second &
third paragraphs, or unless a contrary intent
appears.
Unless o/w authorized by the
buyer, the seller must make such contract w/ the
carrier on behalf of the buyer as may be
reasonable, having regard to the nature of the
goods & the other circumstances of the case. If the
seller omits so to do, & the goods are lost or
damaged in course of transit, the buyer may
decline to treat the delivery to the carrier as a
delivery to himself, or may hold the seller
responsible in damages.
Unless o/w agreed, where goods
are sent by the seller to the buyer under
circumstances in w/c the seller knows or ought to
know that it is usual to insure, the seller must give
such notice to the buyer as may enable him to
insure them during their transit, &, if the seller fails
to do so, the goods shall be deemed to be at his risk
during such transit.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
NOTA BENE: THIS PROVISION APPLIES ONLY IF THERE IS
AN AGREEMENT THAT THE SELLER WILL SHIP THE GOODS
Definition of Terms:
GEN’L RULE: Delivery to the carrier constitutes delivery to
the buyer, whether the carrier was named by the buyer or
C.O.D. – Collect of Delivery – Carrier collects the
not.
purchase price.
EXCEPTIONS:
1) The contrary appears (parties did not intend delivery to
F.O.B. – Free on Board – where ever the FOB pertains to,
carrier is delivery to buyer)
the buyer shall not pay for the expenses of delivery up to
2) 1st, 2nd & 3rd pars of 1503
that place of designation.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Ex. FOB-Manila. Buyer’s place of business is in Bulacan.
The goods will be coming from Cebu (seller’s place of
business). The expenses for shipping the goods from Cebu
to Manila will be borne by the seller. The expenses for
shipping the goods from Manila to Bulacan shall be borne
by the buyer. “Free” yung expenses from Cebu to Manila.
DUTIES OF SELLER AFTER DELIVERY TO CARRIER:
1) Enter into contract w/ the carrier on behalf of the buyer. C.I.F. – Cost, Insurance & Freight – Signifies that the
- Failure to do so: price fixed covers also expenses of freight & insurance.
A) Buyer may DECLINE to treat delivery to carrier as IOW, the seller pays for the insurance & shipping
delivery to him; OR expenses.
B) B) the buyer may hold seller responsible for DAMAGES
F.A.S. – Free Along Side – The seller pays all charges & is
2) To give notice to the buyer regarding necessity to insure subject to risk until the goods are placed alongside the
the goods vessel. (Mem-Aid 2012)
- Failure to do so: RISK borne by the seller PROVIDED the
buyer is unaware of the need to insure such goods. If the SOURCE: LAW ON SALES REVEIWER (kupdf.net)
buyer is aware of the need to insure, seller may not be held
responsible.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)

Article 1524
The vendor shall not be bound to
deliver the thing sold, if the vendee has not paid
him the price, or if no period for the payment has
been fixed in the contract.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
GEN’L RULE: The obligation to deliver arises from the
moment the contract is perfected. The buyer may, from that
moment, demand delivery. The seller, reciprocally, may
demand payment. Hence, the thing shall not be delivered
unless the price be paid.
EXCEPTION: The thing shall be delivered but the price shall
not be paid first, if the time of payment has been fixed to be
paid at a latter date. (in such cases, the seller is considered
to have sold on credit)
EXCEPTION TO THE EXCEPTION: Vendee has lost the
right to make use of the period of payment. Art. 1536
(Period of payment is at a latter date but the seller is not
bound to make delivery)
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Article 1525
The seller of goods is deemed to be an unpaid
seller w/in the meaning of this Title:
(1) When the whole of the price has not been paid
or tendered;
(2) When a bill of exchange or other nego
instrument has been received as conditional
payment, & the condition on w/c it was
received has been broken by reason of the
dishonor of the instrument, the insolvency of
the buyer, or o/w.
In arts 1525 to 1535 the term
"seller" includes an agent of the seller to whom the
bill of lading has been indorsed, or a consignor or
agent who has himself paid, or is directly
responsible for the price, or any other person who
is in the position of a seller.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
Note:
Art. 1249. Par. 2. The delivery of promissory notes
payable to order, or bills of exchange, or other
mercantile documents shall produce the effect of
payment only when they have been cashed x x x
Note consignation. 1256. If the creditor to whom tender
of payment has been made refuses w/o just cause to
accept it, the debtor shall be released from
responsibility by the consignation of the thing or sum
due.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
An UNPAID SELLER is one who:
1) has not been paid or to whom the price has not been
tendered
2) has received a bill of exchange or other negotiable
instrument as conditional payment, & the condition
to w/c it was received has been broken by reason of
the dishonor of the instrument, insolvency of the
buyer or o/w.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
UNPAID SELLER includes:
1) Agent of the seller;
2) Consignor or agent who has himself paid or is
directly responsible for the price; or
3) Any Other person in the position of the seller.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
WHERE WHOLE OF PRICE HAS NOT BEEN PAID: 1)
Tender of payment by buyer – such as checks (juan
tamad). Seller’s lien is destroyed.
2) Payment of part of price – payment of price does NOT
destroy a seller’s lien. The seller remains an unpaid
seller even if title has passed to the buyer.
3) Payment by negotiable instrument – OBLICON (Art.
1249)
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
 Article 1526
Subject to the provisions of this Title,
notwithstanding that the ownership in the goods
may have passed to the buyer, the unpaid seller of
goods, as such, has:
(1) A lien on the goods or right to retain them for
the price while he is in possession of them;
(2) In case of the insolvency of the buyer, a right
of stopping the goods in transitu after he has
parted w/ the possession of them;
(3) A right of resale as limited by this Title;
(4) A right to rescind the sale as likewise limited
by this Title.
Where the ownership in the goods
has not passed to the buyer, the unpaid seller has,
in addition to his other remedies a right of
withholding delivery similar to & coextensive w/
his rights of lien & stoppage in transitu where the
ownership has passed to the buyer.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
REMEDIES OF UNPAID SELLER (SAR-SPASMS)
1) Possessory lien (Art 1527-1529)
2) Stoppage of goods in transitu (Art 1530)
3) Special right of resale (Art 1533)
4) Special right of rescission (Art 1534)
5) Action for the price (Art 1595)
6) Action for damages (Art 1596)
7) Recto Law (Art 1484)
8) Maceda Law (Governs financing of real estate on installment
payment) (ung special law na cinite sa Layug v IAC)
9) Specific performance (Art 1595)
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Article 1527
Subject to the provisions of this Title, the unpaid seller of
goods who is in possession of them is entitled to retain
possession of them until payment or tender of the price in
the ff cases, namely:
(1) Where the goods have been sold w/o any stipulation as
to credit;
(2) Where the goods have been sold on credit, but the term
of credit has expired;
(3) Where the buyer becomes insolvent.
The seller may exercise his right of lien
notwithstanding that he is in possession of the goods as
agent or bailee for the buyer.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
POSSESSORY LIEN – a right to retain possession of goods
WHEN IT MAY BE EXERCISED
a) The goods has been sold w/o any stipulation as to credit
b) The goods has been sold on credit, but the term of credit
has expired
c) The buyer becomes insolvent
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Definition of Terms:
CREDIT SALE – whereby the seller binds himself to
give the goods to the buyer w/o receiving at that time
payment for them. Stipulation as to credit – means
that a period of payment price has been fixed in the
contract. In the absence of this stipulation, the seller
is entitled to the payment of the price at the same
time that he transfers the possession of the goods.
Accordingly, the seller always has a lien upon the
goods until payment or tender of the entire price.
INSOLVENT – is a person who either ceased to pay his
debts in the ordinary course of
business or cannot pay his debts as they become due.
(w or w/o insolvency proceedings)
Insolvency does not dissolve the bargain, it merely
revives the seller’s lien.
Note: Notwithstanding transfer of ownership,
possessory lien may still be exercised as long as the
goods are in the possession of the seller.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
 Article 1528
Where an unpaid seller has made part delivery of
the goods, he may exercise his right of lien on the
remainder, unless such part delivery has been
made under such circumstances as to show an
intent to waive the lien or right of retention.
SOURCE: LAW ON SALES, AGENCY AND CREDIT
TRANSACTIONS (HECTOR S. DE LEON 2010)
GEN RULE: Lien NOT lost by partial delivery.
When part of the goods are delivered, the unpaid seller has a
lien upon the remainder for the proportion of the price w/c is
due on account of the goods so retained.
EXCEPT: Art 1529 (3)
Delivery of the part intended as symbolical delivery of the
whole, w/c is considered a waiver of any right of retention as to
the remainder & therefore the lien is lost.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Article 1529 WHEN UNPAID SELLER LOSES POSSESSORY LIEN
1) Delivery to agent/a carrier or bailee of buyer
a. For the purpose of transmission to the buyer
b. W/o reserving ownership or right of possession
2) Possession by buyer or his agent – when buyer lawfully
obtains possession
The unpaid seller of goods loses his lien thereon: 3) Waiver of the lien
(1) When he delivers the goods to a carrier or other
bailee for the purpose of transmission to the buyer SOURCE: LAW ON SALES REVEIWER (kupdf.net)
w/o reserving the ownership in the goods or the
right to the possession thereof;
(2) When the buyer or his agent lawfully obtains LOSS OF LIEN (Tolentino) The lien of the seller depends upon
possession of the goods; either possession OR control of the property on w/c the lien is
(3) By waiver thereof. The unpaid seller of goods, claimed, & if the seller permits the property to go into actual
having a lien thereon, does not lose his lien by possession of the buyer, such LIEN IS LOST, although he delivers
reason only that he has obtained judgment or on the faith of a chattel mortgage w/c turn out to be invalid, or
decree for the price of the goods. draft given in payment was dishonored. If however, the seller has
been induced to part w/ possession by fraud, the lien of the seller
SOURCE: LAW ON SALES, AGENCY AND CREDIT is NOT LOST.
TRANSACTIONS (HECTOR S. DE LEON 2010)
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
Note:
 When seller has no possession of goods anymore, he therefore has no
more lien
REVIVAL OF LIEN AFTER DELIVERY
 Buyer’s wrongful taking of the goods w/o the seller’s consent does NOT
destroy the lien 1) If the buyer refuses to receive the goods after they have been
 If goods are put in the possession of the buyer merely for purpose of delivered to a carrier on his behalf, though the seller has parted
allowing the buyer to examine the goods, the lien in intact. w/ both ownership & possession may reclaim the goods & revest
 Seller may lose his lien by express agreement to surrender such lien -
himself w/ his lien (see Art 1531 par.2)
thus, where the buyer was allowed to alter the character of the goods &
make them much more valuable, the seller could no longer assert a lien. 2) If the buyer returns the goods in wrongful repudiation of the
 Mere judgment by a court obtained by the unpaid seller for the price of sale, the lien is revived
the goods is NOT a ground for the loss of his lien (Art 1529, par.2) SOURCE: LAW ON SALES REVEIWER (kupdf.net)
 Possessory lien IS LOST after the seller loses possession BUT his LIEN on
the price as an unpaid seller remains. The bringing of an action to
recover the purchase price is NOT one of the ways of losing possessory
lien
 (from PINEDA)
 Possessory Lien- The seller is entitled to retain possession of
the goods as security for the purchase price
• Lien on the Price- After delivery, the seller loses his
possessory lien but retains his lien on the price of the goods
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
  Notice must be given either to the person in actual possession of the goods or
Article 1530 to his principal
 When notice is given to the carrier or other bailee in possession of the goods,
he must deliver the goods according to the directions of the seller
(NOTE: expenses must be borne by the seller)
 EXCEPTION: a negotiable document of title representing the goods has been
issued (in w/c case the carrier or bailee is not obliged to redeliver the goods
unless the seller surrendered the document for cancellation)
Subject to the provisions of this Title, when the
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
buyer of goods is or becomes insolvent, the unpaid
seller who has parted w/ the possession of the
goods has the right of stopping them in transitu,
that is to say, he may resume possession of the
goods at any time while they are in transit, & he Article 1531
will then become entitled to the same rights in
regard to the goods as he would have had if he had
never parted w/ the possession..

SOURCE: LAW ON SALES, AGENCY AND CREDIT Goods are in transit w/in the meaning of the preceding art:
TRANSACTIONS (HECTOR S. DE LEON 2010)
(1) From the time when they are delivered to a carrier by land, water, or air, or other bailee for the
purpose of transmission to the buyer, until the buyer, or his agent in that behalf, takes delivery of
them from such carrier or other bailee;
(2) If the goods are rejected by the buyer, & the carrier or other bailee continues in possession of
them, even if the seller has refused to receive them back.
Requisites for the exercise of RIGHT OF STOPPAGE OF
GOODS IN TRANSITU:
Goods are no longer in transit w/in the meaning of the preceding art:
1. Seller must be unpaid (Art 1525)
(1) If the buyer, or his agent in that behalf, obtains delivery of the goods before their arrival at the
2. Buyer must be insolvent (need not be judicially declared)
appointed destination;
3. Goods must be in transit
(2) If, after the arrival of the goods at the appointed destination, the carrier or other bailee
4. Seller must either – a. take possession of the goods sold b.
acknowledges to the buyer or his agent that he holds the goods on his behalf & continues in
give notice of his claim to the carrier or other person in
possession of them as bailee for the buyer or his agent; & it is immaterial that further destination for
possession of the goods
the goods may have been indicated by the buyer;
5. Seller must surrender the negotiable document of title, if any,
(3) If the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent in
issued by the carrier
that behalf.
6. Seller must bear the expenses of delivery of the goods after
If the goods are delivered to a ship, freight train, truck, or airplane chartered by the
the exercise of the right
buyer, it is a question depending on the circumstances of the particular case, whether they are in the
possession of the carrier as such or as agent of the buyer.
SOURCE: LAW ON SALES REVEIWER (kupdf.net)
If part delivery of the goods has been made to the buyer, or his agent in that behalf,
the remainder of the goods may be stopped in transitu, unless such part delivery has been under such
circumstances as to show an agreement w/ the buyer to give up possession of the whole of the goods.

SOURCE: LAW ON SALES, AGENCY AND CREDIT TRANSACTIONS (HECTOR S. DE LEON 2010)
 WHEN GOODS ARE NO LONGER IN TRANSIT

1. After delivery to the buyer or his agent in that behalf

WHEN GOODS ARE CONSIDERED IN TRANSIT 2. If the buyer or his agent obtains possession of the goods at
a point before the destination originally fixed
1. After delivery to a carrier or other bailee & before the 3. If the carrier or the bailee acknowledges to hold the goods
buyer or his agent takes delivery of them in behalf of the buyer
2. If the goods are rejected by the buyer, & the carrier or VS. 4. If the carrier or bailee wrongfully refuses to deliver the
other bailee continues in possession of them (even if the goods to the buyer
seller refuse to receive them back)
*If the carrier is owned by the buyer, carrier is considered an
SOURCE: LAW ON SALES REVEIWER (kupdf.net) agent for the buyer. Therefore, delivery to carrier = delivery to
buyer

SOURCE: LAW ON SALES REVEIWER (kupdf.net)

Note:
 Taking of goods in transit by an unauthorized agent of the
buyer DOES NOT extinguish the right of stoppage n transitu
(Paras)
 In case of misdelivery, the goods are still considered in
transit, hence, the seller may still exercise said right
pursuant to Art 1523, w/c provides that an unpaid seller
may exercise his right of stoppage in transitu by giving
notice of his claim to the carrier or other bailee in whose
possession the goods are.

ATTORN – to agree to be tenant to a new owner of the same

prop

SOURCE: LAW ON SALES REVEIWER (kupdf.net)