Sales Part 1

• Art. 1458- by the contract of sale one of the contracting parties(seller) obligates himself 1. to transfer ownership and 2. to deliver a determinate thing, and the other(buyer) to 1. pay therefor a price certain in money or its equivalent 
• Obligation of the Seller 

  1. Transfer the ownership 
  2. Deliver the thing 
  3. Warrant against eviction and hidden defects 
  4. Observe the diligence of good father of a family 
  5. Pay for the expenses -Seller pay the expenses unless there is a stipulation then the buyer will be the one to pay for the same 
• Obligation of the Buyer 

  1. Accept the delivery 
  2. Pay the price-Cause 
• Elements of Contract 

  1. Essential, if not present the contract is VOID 
  2. Accidental- may or may not be present- not affect the validity of a contract 
  3. Natural – automatic part of the contract 
• ELEMENTS OF CONTRACT

  Essential, if not present the contract is VOID 

  a.Common –Consent Object Cause/Consent Object Price 

  b. Special(e.g.-delivery in real contracts 

  c.Extraordinary(e.g.-price in a sale 
• ELEMENTS OF CONTRACT

  Natural – automatic part of the contract 

  a.Basic natural elements 

  a.1.Warrant against eviction

  b.1Warranty against hidden defect 

  c.1Warranty of fitness or merchant ability 
• Consensual v. real 

  Consensual (1319)- perfected by mere consent 

  Real (1316)- require 2 things (consent and delivery) 
• Bilateral v. Unilateral 

  Bilateral- two party ( buyer and seller) 

  Unilateral 
• Reciprocal v. Non-reciprocal  

  Reciprocal- both parties perform 

  Non-reciprocal-  
• Onerous v. Gratuitous 

  Onerous- there's a price for it 

  Gratuitous- free 
• Commutative v. Aleatory 

  Commutative- equal 

  Aleatory- Unequal/ inequivalent 
• Nominate v. Innominate 

  Nominate- name 

  Innominate- no name 
• Principal v. Accessory 

  Principal- can stand alone 

  Accessory- dependent on principal 
• Characteristics of sale 

  1. Consensual v. real 
  2. Bilateral v. Unilateral
  3. Reciprocal v. Non-reciprocal  
  4. Onerous v. Gratuitous 
  5. Commutative v. Aleatory 
  6. Nominate v. Innominate 
  7. Principal v. Accessory 
• Stages of sale 

  1. Preparation /bargaining/ Negotiation – making offer 
  2. Perfection /Creation / birth- no meeting of minds 
  3. Termination/ Consummation- perform the obligation 
• Is delivery required to create a contract of sale- No because it is a consensual contract. Delivery is required at the time of termination, at the time of consummation 
• When is ownership required? It is required at the time of delivery and delivery is required at the time of termination 
• Perfection of Sale (1475) 

  Art. 1475. The contract of sale is perfected at the moment there is a meeting of minds upon the thing which is object of the contract and upon the price. 

  From that moment, the parties may reciprocally demand performance, subject to the provisions of the law governing the form of contracts (1450a) 

   General Rule- No form is required (Why? Because it is a consensual contract) 
• Exception Perfection of Sale (1475) 

  1.  If covered by statute of frauds (For ENFORCEABILITY) 
  2. Auction Sale (1476)- it is perfected from the moment of the fall of the hammer or in any other customary manner 
• a. If covered by statute of frauds (For ENFORCEABILITY) 

  -Sale of personal property 500 or more 

  ---In WRITING, otherwise- UNENFORCEABLE 

  -Sale of Real property, regardless of value 

  ---IN WRITING 
• A bidder can withdraw before the fall of the hammer
• The auction sale is perfected from the moment of the fall of the hammer or in any other customary manner
• The auction sale is perfected


  From the moment of the fall of the hammer or in any other customary manner
• The seller can't employ a by-bidder or puffers
• The auctioneer can withdraw before the fall of the hammer unless announced without reserve
• The seller can bid if it is announced with reserve meaning will bid in this case
• Each constitutes a separate contract sale
• The sale of separate lots by auction are separate sales
• 1. When is the sale perfected? Perfected upon the fall of the hammer or in any other customary manner 
  2. Can the bidder withdraw? Yes, before the fall of the hammer 
  3. Can the auctioneer withdraw? Yes, before the fall of the hammer unless announced without reserve 
  4. Can the seller bid? General rule- No; Except- if itis announce with reserve meaning will bid in this case 
  5. Can seller employ by-bidder or puffers? No  that is VOID 
  6. Sale of separate lots by auction are separate sales- each constitute separate contract sale 
• Form in Donation is for VALIDITY- if does not comply to it is VOID 
• Perfection of the contract if sent by letter (1319, 2nd par) 

  4 Theories in the perfection Contract 

  1. Manifestation theory (Code of Commerce) - buyer declares he’s going to buy the same 
  2. Expedition Theory (American Courts) - buyer sent the letter 
  3. Reception Theory (German Civil Code) - the seller received, the acceptance on the part of the buyer 
  4. Cognition Theory (Spanish Civil Code Code)- knowledge, from the moment it came to his knowlegde 
• Cognition Theory (Spanish Civil Code Code)- knowledge, from the moment it came to his knowlegde 

  -Acceptance made by the letter or telegram does not bind the offerer except from the time it came to his knowledge. The contract, in such a case, is presumed to have been entered into in a place where the offer was made. 

  ---When is the contract perfected? From the time of knowledge

  ---Where is the contract perfected? Where the offer was made 
•  September 8: A(seller) write a letter (want to buy the land for 100k) to B (Buyer) 

  October 1: The letter arrives to B(buyer) 

  October 2: B(buyer) declares he want to buy – Manifestation Theory 

  October 3: B(buyer) send the acceptance to A – Expedition Theory 

  October 5: A(seller) received the letter- - Reception Theory 

  October 6: A(seller) read the letter- Cognition Theory 
• E-COMMERCE ACT OF 2000/ RA 8792 (ECA) 

  Election Contracts 

  • An offer, the acceptance of an offer and such other elements required under existing law for the formation of contracts may be expressed in, demonstrated and proved by  means of electronic documents. 
  • No contract shall be denied validity or enforceability on the sole ground that it is in the form of an electronic document 
• Essentials Requisites of Sales 

  Consent (1319) 

  1320- Form of Acceptance- may be expressed or implied 

  1321- Matters that may be fixed by the offerer- place, manner time of delivery 

  1324- Option Money v. Earnest Money- no contract of sale: there a contract of sale 

  1330- Vices of consent (MIVUF) - if one is present VOIDABLE 

  1340- Usual exaggerations in trade- sale's talk VALID 

  1341- Expression of opinion- general rule VALID, if made by expert VOIDABLE 

  1345/ 1346- Simulation of Contract- pretending to agree when in fact there is no contract at all
• • Absolute – VOID, no intention rebound 
  • Relative- VALID, part is concealed 
• Sales 

  1. Determinate (1460) /Determinable (2nd par)- particularly designated or physically segregated from all others/ come to existence 
  2. Licit/ Lawful (Illicit per se [inherently void, inherently illegal] v. Illicit per accidens[illegal])- 
  3. Not impossible- legally impossible and physically impossible VOID 
  4. Right to transfer ownership at the time the object is delivered (1459) 
  5. Transmissible 
• What could be the object of Sale? 

  1. Potential existence (emptio res speratae) 1461 
  2. Hope or expectancy (emptio spei) 1461 
  3. Existing (OP)[owned or possessed] or future goods (MRA) [manufactured, raised or acquired by the seller after the perfection of the contract ]1462-  
  4. Contingency/subject to suspensive condition 1462 
  5. Undivided interest in a thing 1463 
  6. Undivided interest in a mass 1464 
  7. Subject to a resolutory condition 1465 
• Emptio res speratae : Emptio spei

  
• When is the price certain? 1469 

  1. Fixed by the parties (why? Mutuality) Except-1473 
  2. Fixed by the person 
  3. Fixed by the court (2)-  
  4. Price on a given day at a particular market- 1472- above or below the price 
  5. With reference to another thing which is certain (1469)