RFBT2

• Obligations of the vendee

  The principal obligations of the buyer are to accept delivery and to pay the price of the thing sold
• Acceptance of delivery


  1. Buyer must accept delivery at the time and place stipulated in the contract

  2. If no stipulation, payment must be made when seller tenders delivery, and delivery must be made where buyer tenders payment

  3. Acceptance may be express or implied
• Payment of the price

  • Buyer is bound to accept delivery and pay the price at the time and place stipulated
  • If no stipulation, payment must be made at time and place of delivery
  • Payment must be made at place stipulated, or place where thing was when obligation was constituted
• Buyer is not bound to accept delivery by installments, unless otherwise agreed
• Buyer's right to examine

  • Buyer is entitled to examine goods prior to delivery
  • Buyer is deemed to have accepted goods if he retains them without intimating rejection after a reasonable time
  • Buyer has no right to examine if there is a stipulation against it, or if goods are delivered "collect on delivery" without agreement
• Acceptance by buyer does not discharge seller from liability for breach of warranty
• Payment of interest for price


  Buyer is obliged to pay interest on price between delivery and payment in certain cases
• Suspension of payment of price

  • Buyer may suspend payment if disturbed in possession/ownership or has well-grounded fear of disturbance
  • Buyer cannot suspend payment if seller gives security, it is stipulated, seller has caused disturbance to cease, or disturbance is just trespass
• Rescission of sale of real property

  Buyer may pay even after expiration of period, as long as no demand for rescission has been made
• Rescission of sale of personal property

  Rescission shall take place in interest of seller if buyer does not appear to receive or tender price on expiration of delivery period
• Acceptance by the buyer does not discharge the seller from liability for breach of warranty in the contract of sale
• If the buyer fails to give notice to the seller of the breach of warranty within a reasonable time, the seller shall not be liable
• The buyer may suspend the payment of the price if he is disturbed in the possession or ownership of the thing bought, or if he has a well-grounded fear that his possession or ownership would be disturbed by a vindicatory action
• The buyer is not allowed to suspend the payment of the price if the vendor gives security for the return of the price in a proper case
• In sale of real property, even though it may have been stipulated that upon failure to pay the price at the time agreed upon, rescission of contract shall take place, the buyer may pay even after the expiration of the period, as long as no demand for rescission of contract has been made
• In sale of personal property, rescission shall take place in the interest of the seller, if the buyer, upon expiration of the period fixed for the delivery of the thing, should not have appeared to receive it, or having appeared, he should not have tendered the price
• Where, under the contract of sale, the ownership of the goods has passed to the buyer, and he refuses to pay, the seller may sue for the price
• Where, under the contract of sale, the price is payable on a certain day, irrespective of transfer of title, and the buyer refuses to pay, the seller may sue for the price
• Where, under the contract of sale, the seller and the buyer agreed that the payment and delivery would be made on a certain day, and on said date, the seller may offer to deliver the goods to the buyer, and if the buyer refuses to accept the goods, the seller may notify the buyer that he is holding the goods no longer as the owner but as the depositary of the buyer. The seller can thereafter sue for the price
• Where the buyer wrongfully neglects or refuses to accept and pay for the goods, the seller may maintain an action for damages for non-acceptance
• The seller may rescind the contract of sale of goods which have not been delivered, when the buyer has repudiated the contract, manifested inability to perform, or committed a breach
• In case the seller fails to comply with his contract to deliver specific or ascertained goods, the seller cannot retain the goods on payment of damages
• Remedies of the buyer where seller commits breach of warranty

  • Accept the goods and set up breach of warranty against the price
  • Accept the goods and maintain action against seller for breach of warranty
  • Refuse to accept the goods and maintain action against seller for damages
  • Rescind the contract and refuse to receive or return the goods and recover the price paid
• Causes of extinguishment of sale

  The modes of extinguishment an obligation or a contract are generally the causes of extinguishment of sale. However, there are special modes of extinguishing a contract which are applicable only to contracts of sale like the seller exercising his right of rescission or right to resell. A contract of sale may also be extinguished by conventional redemption or legal redemption.
• Conventional redemption


  The right which the vendor reserves to himself, to reacquire the property sold provided he reimburses the vendee of: 1. The price; 2. The expenses of the contract; 3. Any other legitimate payments made therefor, and 4. The necessary and useful expenses made on the thing sold; and fulfills other stipulations which may have been agreed upon.
• Characteristics of conventional redemption

  • It is a purely contractual right because it is created, not by mandate of the law, but by virtue of an express contract
  • It is an accidental stipulation and, therefore, its nullity cannot affect the sale itself since the latter might be entered into without said stipulation
  • It is a real right because when registered, it binds third persons
  • It is a potestative condition because it depends upon the will of the vendor
  • It is a resolutory condition because when exercised, the right of ownership acquired by the vendee is extinguished
  • It is not an obligation but a power or privilege that the vendor has reserved for himself
  • It is reserved at the moment of the perfection of the contract for if the right to repurchase is agreed upon afterwards, there is only a promise to sell which produces different rights and effects
• Period within which right to repurchase in conventional redemption must be exercised


  • If there is no agreement granting the vendor the right to redeem, there is no right of redemption since the sale should be considered an absolute sale
  • If the parties agree only on the right to redeem on the part of the vendor but there is a total absence of express stipulation as to the time within which the repurchase should be made, then the period of redemption shall be four (4) years from the date of the contract
  • If the parties agree on a definite period of redemption, then the right to redeem must be exercised within the period fixed provided it does not exceed ten (10) years
  • If the parties agree that the vendor shall have the right to redeem and they intend a period which, however, is not specified (e.g. "at any time the vendor has money"), then the redemption period is ten (10) years
  • From the time final judgment was rendered in a civil action on the basis that the contract was a true sale with right
• Effect of the failure of the vendor to redeem


  If the seller fails to redeem the property within the proper period, and the property involved is a personal property, the buyer becomes the absolute owner of the property. If the seller fails to redeem the property within the proper period, and the property involved is a real property, the buyer has to go to court have himself declared as the absolute owner of the property. The transaction may not be a genuine pacto de retro but only an equitable mortgage.
• Equitable mortgage


  One although lacking in some formality, form of words, or other requisites demanded by statutes nevertheless reveals the intention of the parties to change a real estate as security for a debt, and contains nothing impossible or contrary to law.
• Instances when equitable mortgage is presumed in sale with right to repurchase


  • When the price of a sale with right to repurchase is unusually inadequate
  • When the vendor remains in possession as lessee or otherwise
  • When upon or after the expiration of the right to repurchase another instrument extending the period of redemption or granting a new period is executed
  • When the purchaser retains for himself a part of the purchase price
  • When the vendor binds himself to pay the taxes on the thing sold
  • In any other case where it may be fairly inferred that the real intention of the parties is that the transaction shall secure the payment of a debt or the performance of any other obligation
• Legal redemption


  The right to be subrogated, upon the same terms and conditions stipulated in the contract, in the place of one who acquires a thing by purchase or dation in payment, or by any other transaction whereby ownership is transmitted by onerous title.
• Instances of legal redemption

  • Redemption by a co-heir of the share sold by the other heir
  • Redemption by a co-owner
  • Redemption by an adjoining owner of a piece of a rural land or urban land
  • Redemption by a debtor in case the sale of right in litigation
• Rights of the vendee a retro

  • To be subrogated to the vendor's rights and actions
  • To compel the vendor of a part of an undivided immovable to redeem the whole property in case the vendee a retro of such part acquires the entire immovable
• Requisites for the exercise of the right of legal redemption by a co-owner

  • There must be a co-ownership
  • There must be alienation of all or of any of the shares the other co-owners
  • The sale must be to a stranger
  • The sale must be made before partition
• Requisites for the exercise of the right of legal redemption of rural lands by adjoining owners

  • Both the land of the one exercising the right of the redemption and the land sought to be redeemed must be rural
  • The lands must be adjacent
  • There must be an alienation
  • The piece of rural land alienated must not exceed one (1) hectare
  • The vendee must already own some rural land
  • The rural land sold must not be separated by brooks, drains, ravines, roads and other apparent servitudes from the adjoining lands
• Requisites for the exercise of the right of legal redemption of urban lands by adjoining owners

  • The one exercising the right must be an adjacent owner
  • The piece of land sold must be so small and situated that a major person thereof cannot be used for any practical purpose within a reasonable time
  • Such urban land was bought by its owner merely for speculation
• Obligations of the vendee

  The principal obligations of the buyer are to accept delivery and to pay the price of the thing sold
• Acceptance of delivery


  • The buyer must accept delivery at the time and place stipulated in the contract
  • If there is no stipulation, payment must be made at the time when the seller tenders delivery to the buyer, and delivery must be made at the place where the buyer tenders payment to the seller
  • Acceptance of delivery may be express or implied
• Payment of the price

  • The buyer is bound to accept delivery and to pay the price of the thing sold at the time and place stipulated in the contract
  • If the time and place should not have been stipulated, the payments must be made at the time and place of the delivery of the thing sold
• The buyer is not required to pay before the thing is delivered, and reciprocally, the seller is not bound to deliver before the price is paid