Conditions, Reps and Warranties - Definitions and Requisites

Question 1

Two types of conditions

Answer 1

(1) Performance condition - there exists a perfected contract and the performance by a party of an obligation depends upon the fulfillment of a condition;
(2) Perfection condition - the perfection of the contract depends upon the fulfillment of the condition

Question 2

Meaning of a warranty

Answer 2

A warranty is a statement or representation made by the seller of goods, contemporaneously and as a part of the contract of sale, having reference to the character, quality, or title of the goods, and by which he promises or undertakes to insure that certain facts are or shall be as he then represents them (Ang v. CA 2008);

A warranty is ordinarily considered as an agreement to be responsible for all damages that may arise from the falsity of a statement or assurance of fact. (Pabelo v COMELEC 2015);

Question 3

Kinds of warranty

Answer 3

(1) Express warranty Art. 1546;
(2) Implied warranty Art. 1547.

Question 4

What is an express warranty?

Answer 4

An express warranty is any affirmation of fact or any promise by the seller relating to the thing is an express warranty if the natural tendency of such affirmation or promise is to induce the buyer to purchase the same, and if the buyer purchases the thing relying thereon.

Question 5

Types of express warranties:

Answer 5

An express warranty can be:

(1) A warranty relating to the contract or the transaction
(2) A warranty relating to the object of the contract

Question 6

Does a warranty need to be written?

Answer 6

A warranty need not be in writing; it may be made orally as long as it is not given as a mere opinion or judgment but a positive affirmation of a fact that the buyer relied on and induced him to buy.

Question 7

What is an implied warranty?

Answer 7

An implied warranty is that which the law derives by implication or inference from the nature of the transaction or the relative situation or circumstances of the parties, irrespective of any intention of the seller to create it.

Question 8

What is an eviction?

Answer 8

An eviction occurs when the vendee is deprived of the whole or part of the thing purchased by virtue of a final judgment based on a right prior to the sale or an act imputable to the vendor.

Question 9

What are the essential elements of a warranty against eviction?

Answer 9

The essential elements of a warranty against eviction:

1. The vendee is deprived in whole or in part of the thing purchased;
2. He is so deprived by virtue of a final judgment;
3. The judgment is based on a right prior to the sale or an act imputable to the vendor;
4. The vendor was summoned in the suit for eviction and made a co-defendant;
5. There is no waiver on the part of the vendee.

Question 10

What are the kinds of waiver of eviction?

Answer 10

(1) Consciente (aka simple), that is, the waiver is volutarily made known by the vendee without the knowledge and assumption of the risks of eviction;
(2) Intencionada (aka calificada), that is the waiver is made by the vendee with the knowledge of the risks of eviction and assumption of consequences.

Question 11

What is redhibition?

Answer 11

Redhibition is the avoidance of a sale on account of some vice or defect in the thing sold, which renders its use impossible, or so inconvenient and imperfect that it must be supposed that the buyer would not have purchased it had he known of the vice.

Question 12

Redhibitory action

Answer 12

Redhibitory action is an action institute to avoid a sale on some account of some vice or defect in the thing sold which renders its use, impossible, or so inconvenient and imperfect that it must be supposed that the buyer would not have purchased it had he known of the vice.

Question 13

Accion quanti minoris

Answer 13

Accion quanti minoris is when the object of the action is to procure the return of a part of the purchase price paid by the vendee. (a.k.a. estimatoris)

Question 14

Redhibitory vice or defect

Answer 14

Redhibitory vice or defect is a defect in the article sold against which defect the seller is bound to warrant. The vice or defect must constitute an imperfection, a defect in its nature, or certain importance; and a minor defect does not give rise to rehibition.

Question 15

Requisites for warranty against hidden defects

Answer 15

Requisites for warranty against hidden defects

1. The defect must be important or serious;
2. The defect must be hidden;
3. The defect must exist at the time of the sale;
4. The vendee must give notice of the defect to the vendor within a reasonable time;
5. The redhibitory action or the action for reduction of the price must be brought within the proper period – six (6) months from the delivery of the thing sold or within 40 days from the date of the delivery in case of animals;
6. There must be no waiver of warranty by the vendee.