Part 1, CH 1-3

• By the contract of sale one of the contracting party 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.
• Characteristics of s contract of sale:

  1. Consensual
  2. Bilateral
  3. Onerous
  4. Commutative
  5. Nominate
  6. Principal
• A contract of sale is commutative as the thing sold is considered the equivalent of the price paid and vice versa. However, the contract may be aleatory as in the case of the sale of a hope.
• Essential requisites of a contract of sale:

  1. Consent or meeting of the minds
  2. Object or subject matter
  3. Cause or consideration
• Natural elements are those which are deemed to exist in certain contracts, in the absence of any stipulations like warranty against eviction or hidden defects
• Accidental elements are those which may be present or absent depending on the stipulations of the parties, like conditions, interest, penalty, time or place of payment, etc.
• Two kinds of sale:

  1. Absolute
  2. Conditional
• Absolute - where the sale is not subject to any condition whatsoever and where title or ownership passes to the buyer upon delivery of the thing sold
• Conditional - where the sale contemplates a contingency, and the contract is subject to conditions. The delivery of the thing sold does not transfer ownership until the condition is fulfilled.
• The thing must be licit and the vendor must have a right to transfer the ownership thereof at the time it is delivered.
• For the object of sale, it must be:

  1. Determinate
  2. Licit
  3. Not be impossible
• Kinds of illicit things:

  1. Illicit per se (of its nature)
  2. Illicit per accidens (provisions of law)
• The vendor must be the owner or at least must be authorized by the owner of the thing sold.
• It is sufficient if the vendor has the right to sell the thing at the time when the ownership is to pass.
• A thing is determinate or specific when it is particularly designated or physically segregated from all others of the same class.
• The requisite that a thing be determinate is satisfied if at the 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. Ascertaing its identity, quantity or quality.
• Things having a potential existence may be the object of the contract of sale.
• The efficacy of the sale of a mere hope is deemed subject to the condition that the thing will come into existence
• The sale of a vain hope is void
• The sale of hope or expectancy is valid even if the thing hoped does not come into existence.
• Goods which may be the object of sale:

  1. Existing goods
  2. Future goods or goods to be manufactured
• A sale of future goods even though the contract is in the form of a present sale, is valid only as an executory contract to be fulfilled by acquisition and delivery.
• The sole owner of a thing may sale an undivided interest therein.
• The legal effect of the sale of an undivided interest in a thing is to make the buyer a co-owner of the thing sold.
• Fungible goods are goods of which any unit is, from its nature or by mercantile usage, treated as the equivalent of any other unit
• The owner of a mass of goods may sell only an undivided share thereof, provided the mass is specific or capable of being made determinate.
• If later on it be discovered that the mass of fungible goods contains less than what was sold, the buyer becomes the owner of the whole mass.
• In the sale of an undivided share, the subject matter is an incorporeal or intangible right.
• Things subject to a resolutory condition may be the object of the contract of sale
• A resolutory condition is an uncertain event upon the happening of which the obligation subject to it is extinguished.
• By the contract of agency, a 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.
• In a sale, the buyer, as a general rule, cannot return the object sold; in an agency to sell, the agent can return the object in case he is unable to sell the same to a third person
• By the contract for a piece of work, the contractor binds himself to execute a piece of work for the employer, in consideration of a certain price or compensation.
• Contrary to a contract of sales, the risk of loss before delivery is borne by the worker or contractor and not by the buyer in a contract for a piece of work
• Contracts for a piece of work are not within the Statute of Frauds
• By the 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.
• The manifest intention of the parties is paramount in determining whether it is one of barter or of sale
• The only point of difference between barter and sale is in the element which is present in sale but not in barter, namely: price certain in money or its equivalent.
• A contract of sale is a title and not a mode
• Price fixed by a third person is not binding when third person acts in bad faith or when he disregards specific instructions.