CHAPTER 8 - UNENFORCEABLE CONTRACTS (ART. 1403 - 1408)

Question 1

is one that cannot be enforced unless ratified

Answer 1

Unenforceable contract

Question 2

What is the right to defense of unenforceability?

Answer 2

This right is available only to the contracting parties. Unenforceable contracts cannot be assailed by third persons. (Art. 1408)

Question 3

What are the following are unenforceable contracts?

Answer 3

1. Those entered into in the name of another person by one who has been given no authority or legal representation, or who has acted beyond his powers. (Art. 1403)
2. Those that do not comply with the Statute of Frauds. (Art. 1403)

(3) Those where both parties are incapable of giving consent to a contract.

Question 4

A sells P’s car to B in the name of P without P’s authority. Can B enforce the contract?

Answer 4

B cannot enforce the contract against P unless P ratifies it.

Question 5

P authorizes A to sell P’s car for P100,000.00 cash. A sells the same to B for P100,000.00 in installments. Can B enforce the contract?

Answer 5

B cannot enforce the contract against P unless P ratifies it because although A had the authority to sell the car, he acted in excess of authority.

Question 6

A statute designed to prevent the commission of fraud by requiring certain contracts to be in writing and be subscribed by the party charged. It applies only to wholly executory contracts

Answer 6

Statute of Frauds

Question 7

Contracts where no performance has yet been made by both contracting parties.

Answer 7

Executory Contracts

Question 8

What are the following contracts that must be in writing; otherwise they are unenforceable?

Answer 8

a. An agreement that by its terms is not to be performed within a year from the making thereof.

b. A special promise to answer for the debt, default, or miscarriage of another. This is known as guaranty.

c. An agreement in consideration of marriage, other than mutual promise to marry.

d. Sale of goods, chattels or things in action at a price not less than P500.00.

e. An agreement for the leasing of a real property or of an interest therein for more than one year

f. Sale of real property or an interest therein (regardless of price).

g. A representation as to the credit of a third person.

Question 9

On January 1, 2023, C and D orally entered into a contract for the construction of C’s building which shall begin on February 1, 2024. Is the contract enforceable?

Answer 9

Neither one may enforce the contract against the other on February 1, 2024 as it was not in writing and subscribed by either or both parties

(a. An agreement that by its terms is not to be performed within a year from the making thereof.)

Question 10

D borrowed from C P10,000.00 with G as guarantor. The guaranty was made orally. If D cannot pay, can C enforce the contract?

Answer 10

No, C cannot enforce the guaranty against G since it was not in writing.

(b. A special promise to answer for the debt, default, or miscarriage of another. This is known as guaranty.)

Question 11

F, the father of G, orally agreed to give a house and lot to G, the groom, and B, his bride, in consideration of their marriage. Is the agreement enforceable?

Answer 11

The agreement is unenforceable against F since it is not in writing.

(c. An agreement in consideration of marriage, other than mutual promise to marry.)

Question 12

M and W mutually agreed to marry each other within six (6) months. The agreement was oral. At the end of six (6) months, M refused to marry W. If preparations have been made for the wedding, can M enforce the contract?

Answer 12

M can enforce the contract for the purpose of claiming damages although the mutual promise was not in writing, but not for the specific promise to marry.

(c. An agreement in consideration of marriage, other than mutual promise to marry.)

Question 13

S orally sold his radio for P1,000.00 to B. The parties agreed that the radio would be delivered and the price paid the following day. Is the contract enforceable?

Answer 13

Here, neither party may enforce the contract the following day or thereafter since it was not in writing.

Question 14

S orally sold his radio for P 500.00 to B. The parties agreed that the radio would be delivered and the price paid the following day. Is the contract enforceable?

Answer 14

Yes, the sale is enforceable although it is wholly executory.

Question 15

If lease is one year or less, real or personal property, is it enforceable?

Answer 15

Yes

Question 16

If lease is more than one year, object is immovable, is property enforceable?

Answer 16

No, it is unenforceable

Question 17

D wants to buy construction materials on credit from C. T orally tells C that D has a good credit standing and pays his loans promptly. C thus sells on credit to D because of the representation made by T as to D’s credit. If the representation turns out to be false, is it enforceable?

Answer 17

No, C cannot prove such misrepresentation against T to recover damages because it is unenforceable not being in writing.

Question 18

The contract is unenforceable if one party is a minor, while the other party is insane.

True or False?

Answer 18

True

Question 19

S orally sold to B a radio for P800.00. The parties agreed that S would deliver the radio the following day. B. however, gave a down payment of P200.00. Is the contract enforceable?

Answer 19

Yes, the sale is enforceable because S had accepted a benefit under the contract.

Question 20

S and B entered into a contract whereby S sold his computer to B for P20,000.00. The parties agreed that S would deliver the computer, and that B would pay the price the following day. B signed the written agreement, but S refused to sign it saying that he would sign it when B makes the payment. The following day, B went to the place of S to get the computer and offered the payment. S refuses to deliver the computer. May B enforce the contract against S?

Answer 20

No. It is not enough that there is a writing of the agreement for it to be enforceable. It must likewise be subscribed by the party charged or sought to be held liable. So since S did not subscribe to the agreement, the same cannot be enforced against him.

Question 21

What are the effects of ratification by parent or guardian?

Answer 21

a. When only the parent or guardian of one party ratifies, the contract is voidable at the instance of the parent or guardian of the party who did not ratify the contract.

b. When the parents or guardians of both parties ratify. the contract shall be considered validated from inception. (Art. 1407)

Question 22

Unenforceable contracts cannot be assailed by third persons.

True or False?

Answer 22

True