Law on Sales Flashcards
How is a contract of sale perfected
consent,
the sale of land and sale of personal property worth more than 500 is merely for enforceability
There is equivalents in the prestation of the parties
commutative; antonym: aleatory
If the goods are to be manufactured specially for the customer and upon his special order and not for the general market
contract for a piece of work
The massachusetts rule covers contract for a piece of work
yes
What is the subject of a contract for a piece of work
service
Is there a transfer of ownership in cession
no, only given for the purpose of selling
If the value of the thing is equal to the money or its equivalent, the presumed to be a
contract of sale
What is the governing law on contract of cession
fria
Ownership transfers upon delivery, actual or constructive even if no total payment of the price has been made yet
absolute sale; assumption when silent
Which among contract of sale and contract to sell is resolutory
contract of sale
The rules on double sale applies to contract of sale or contract to sell?
Contract of sale
It only gives the buyer the right to demand the execution of a deed of sale or to compel the seller to sell. Ownership transfers only upon execution of the deed of sale or some other mode of delivery
contract to sell
A contract of sale which or the import of the contract even if not a stipulated or even if the parties or unaware
natural, warranties for example
When can minors and those without in capacity to act can enter validly into a contract of sale
contract of sale of necessaries
In case of purchase of a guardian, agent or executor and administrators, the injured party may be barred from declaration of nullity by
estoppel
Can estoppel run against the government
no, hence the purchase of public officers and employees or administrators of justice can be annulled by declaration of nullity
Are aliens absolutely banned from acquiring lands in the philippines
no, in cases of succession or in case of a former natural born filipino citizen who has lost his citizenship
If the determination of the price is left to the judgment of a special person and such person is unable or unwilling to fix it, the contract will be
inefficacious; declaration of nullity
Can service be a valid subject of a contract of sale
no, since no person acquires ownership of service
The object of contract of sale is said to be determinate when
particularly designated or physically segregated
The requisite that a thing be determinate should be satisfied at
the time the contract is entered into
In case of a sale of an undivided share of a specific mass and the mass contains less than the measure bought, who owns the whole mass
the buyer, and the seller is bound to make good the deficiency
What if the mass is greater than the measure bought
the buyer becomes owner in common
Emptio rae speratae; must come into existence otherwise the sale will be ineffective
Sale of a future thing
emptio spei
sale of hope; it produces effects even if the thing hoped does not come into existence
When is ownership transferred to the buyer
delivery; except if parties agree. Ownership will not pass until a condition is fulfilled
How is a sale by auction perfected
fall of the hammer or in other customary manner
Can the bidder or the auctioneer withdrawal before the perfection of sale
yes
Persons employed by the seller to bid in his behalf
by bidders or puffers
When can a seller participate in the bidding
expressly reserved
notice was given to the bidders and
not prohibited by law or stipulation like litigation
An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding upon the promissor if
supported by a consideration distinct from the price known as the option bond
What is the treatment of a bilateral promise to buy or sell
perfected contract of sale
It is the term for the unilateral promise to buy or sell which has not been accepted
policitacion
A money which forms part of the purchase price and its proof of perfection of a contract of sale
earnest money
What is the remedy of the buyer if the bulk of the goods delivered to not correspond with the description or the sample
rescission
This law applies to a contract of sale of personal property the price of which is payable in installments
recto law
The recto law applies to sales on credit
no, applies to installment Or finance lease only
What is the remedy of the seller should the vendee fail to pay a single or to installment or periodic rental
exact fulfillment
Should the buyer fail to pay two or more installments, what are the remedies of the seller
cancel the sale with a right to recover deficiency (restitution) or
foreclose the chattel mortgage on the thing sold if one has been constituted without the right to recover deficiency; contrary stipulation shall be null and void
In case of cancellation of installment sales under the recto law, the seller is only allowed to retain all the amount paid if
there is a forfeiture clause; however, the seller is allowed to retain a reasonable amount of the purchase price already paid
If another security or a mortgage on a different property is foreclosed in order to satisfy obligations in an installment sale, can the seller collect deficiency
yes, this falls under the remedy of exact fulfillment
This law applies to a contract of sale of residential realty on installments where the buyer is given protection in case of failure to pay installments
Maceda Law
If installments already paid or less than 2 years equivalent, the grace period to pay without interest
within 60 days; can only be applied once every 5 years
Aside from the grace period, what are the rights of the buyer if installments already paid or less than 2 years equivalent
the buyer may sell or assign his interest or
pay the entire balance
What are the additional rights of the value if two years of installment has been paid
in addition to the 60 days grace period, the buyer shall have additional 1 month grace period for every year of installments after the first two years installment
if the seller rescinded, he is required to first give the cash surrender value to the buyer
How many days of grace period is given to the buyer if the he has already paid four years worth of installment
120 days
Cash surrender value for
2 to 5 years of installment
6 years
7 years
50% of all payments including the down payment
55%
60%
The limit of cash surrender value
90% or 14 years of installment
Payment included in the computation of the years of installment period?
No
Is a stipulation as to interest or damages or penalty during a grace period valid
what about forfeiture clause
automatic cancellation
no, it will defeat the purpose of having a grace period
no, csv
no
maceda law
the rescission will take effect only after 30 days from complying with both
notice to the buyer of the intention to rescind
payment of cash surrender value
whichever is later
This act covers the sale of condominium units
pd number 957 or the subdivision and condominium buyers protective decree
What will happen to the installment payments made by a buyer in a subdivision or condominium project for the lot or unit he contracted to buy after due notice to the owner or developer that the forward desists from further payment due to the failure of the owner or developer to develop the subdivision or condominium according to the approved plans and within the time limit
not forfeited, but rather the total amount paid including amortisation interests but excluding delinquency interests with interest thereon at the legal rate
What are the rights of the buyer in the event of his failure to pay the installment due for reasons other than the failure of the owner or developer to develop the project
governed by the maceda law
Who shall pay the real property taxes before the transfer of ownership of the condominium to the buyer
the developer or the owner without recourse against the buyer
What will be the effect to the contract if the thing is entirely lost pending the delivery
ineffective if due to fortuitous event
If the thing is lost import only pending the delivery the buyer may choose between
withdrawing from the contract or demanding the remaining port paying its price in proportion to the total sum agreed-upon
same rules in case of deterioration
Who shall bear the risk if the delivery of goods has been made to the buyer or to a bailee for the buyer in pursuance of the contract and the ownership in the goods has been retained by the seller merely to secure performance by the power of his obligations
buyer
Who shall pay the taxes and incidents of the sale
the seller unless otherwise agreed upon
Between pledge or mortgage and sale, which requires ownership for the validity of the contract
pledge or mortgage
If the seller is not the owner, does the buyer acquires a better title to the goods than the seller had
no as a general rule
Determine whether the following sale made by a thief grants the owner a right to recovery with or without reimbursement to the buyer
- Directly to the buyer
- Public auction
- merchants store
- Registered land (Torren’s title); forged signature
right to recover without reimbursement
right to recover with reimbursement
no right to recover
no right to recover
What kind of estoppel
if after the sale, does a record ownership, such ownership automatically passes to the buyer as to the thing already delivered
estoppel by deed
If the sale is by an apparent owner, can the object be recovered
no if the buyer is in good faith and for value
Laws from which a parent ownership may be had
pd 1529; those dealing with registered land need not inquire beyond the title, also known as the mirror principle; except for banks and public utility companies
factors agent; third persons only have to rely on the power of attorney as written
article 15 18 for goods covered by negotiable instruments
At the time of sale, the seller is in possession and remains in possession in another capacity other than an owner
constitutum possessorium; sale lease back
When the buyer is in possession of the thing other than an owner at the time of sale and remains in possession after same now as an owner
brevi manu
Delivery of key to a warehouse where the goods or located and delivery of the key of the object itself like a house
symbolic; actual
Where is the place of delivery when there is no stipulation to such
usage of trade
seller’s place of business
seller’s residence
where the contract is constituted
What are the remedies of the buyer when the delivery of a personal property is less than the quantity of agreed-upon
reject the delivery or
accept or retain the goods delivered and pay the full contract price if he knew that the seller is not going to perform the contract in full or pay the fair value of the goods delivered if without such knowledge
What are the remedies of the buyer if the delivery of a personal property is greater than the quantity agreed-upon
accept the goods in the quantity agreed upon and reject the rest or
accept the whole goods delivered and pay at contract rate
What is the remedy of the buyer if the delivery personal goods or mixed with goods of different description not included in the contract
the buyer may accept those which are in accordance with the contract and reject the rest
If the delivered quantity of personal property is greater than the quantity or mixed with different description, what is the remedy of the buyer
the body reject the whole of the goods
Real estate is sold at a rate of a certain price for unit of measure; delivery is less than; what are the remedies of the buyer
specific performance and demand delivery of the shortage
proportionate reduction of price or accion quanti minoris
mission if the area is lacking of 1/10 or the buyer would not have entered
Real estate is sold at a rate of a certain price for unit of measure; delivery is more than; what are the remedies of the buyer
accept and reject
accept the whole and pay at contract rate
Whatever is the actual area of the land, the binary system required to pay the price agreed upon and the center is found to deliver the entire area
sale of real estate at a lump-sum price
Sale of real estate at lump-sum; the actual area is bigger; the seller does not deliver the whole actual area; what are the remedies of the buyer
reduce the price in proportion to what is lacking in the area or number
rescind the contract
The right of an unpaid seller to retain the goods or right to withhold delivery of goods
possessory lien
What are the grounds for possessory lien (CCeI)
sold without any stipulation as to credit
sold on credit but the term of credit has expired
the buyer becomes insolvent
Does the unpaid seller lose his right by reason only that he has obtained judgment or decree for the price of the goods
no
The right of an unpaid seller to stop the goods while in transit
stoppage in transitu
If the goods or rejected by the buyer and the carrier continues in possession of them even if the seller has refused to receive them back, the goods are said to be
in transit
If the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent in that behalf, the goods are
no longer in transit
Who should bear the expenses when the right of stoppage in transit is exercised
the seller
Grounds for a right of resale to be exercised PRdDut
perishable
reserve the right of resale in case of default
default for an unreasonable period of time
Should the unpaid seller have a right of lien or stoppage in transit to first to be able to exercise the right of resale
yes
Is notice to the buyer necessary for the validity of rescission
no, but it shall be relevant in determining whether the buyer has been in default
The grounds for the right of rescission to be exercised RDut
reserve the right
default for an unreasonable period of time
The insolvency of the buyer is a requisite only for the right of ___________ but not in all other rights
right of stoppage in transit to; it is a ground to exercise possessory lien but not a requisite
Who has a better right over a movable property which was sold two two or more buyers
first to take possession in good faith
Who has a better right over an immovable property which was sold to two or more buyers
- The first to register in good faith
- The first to take possession in good faith
- the one with the oldest title
one and two, if the property is titled
3 is whether titled or not
Good faith pertains to the time of
registration or possession and not a time of perfection of sale; as such, if at the time of the second sale, the buyer had no knowledge of the prior sale, but learns of it prior to registration or possession, he will not be considered a registrant or possessor in good faith
Any affirmation of fact or any promise by the seller relating to the thing to induce the buyer to purchase the same
warranty
Implied warranties or for a period of
60 days to 1 year
The seller has a right to sell the thing at the time when ownership is to pass and the buyer shell from the time have and enjoy legal and peaceful possession of the thing
warranty against eviction
Can a warranty against eviction be waived by the seller
yes if in good faith
Will the vendor be liable for eviction if the adverse possession had been commenced before the sale but the prescriptive period is completed after the transfer
no
If the seller is in bad faith what are his liabilities (VICED)
value of the thing
income or fruits
costs of the suit
expenses of the contract
damages
a stipulation exempting a vendor for such obligation shall be void
If the vendor is in good faith but no waiver was executed by the buyer, what is the liability of the seller
VICE; no damages
If the seller is in good faith and a waiver is executed by the buyer what is the liability of the seller
if the buyer is not aware of the risk (consciente), the seller shall only be liable for the value of the thing
if the buyer is aware of the risk (intencionada), the seller is no longer liable for anything
Is there a warranty as to its fitness for any particular purpose in the case of contract of sale of a specified on article under its patent or other trade name
none unless there is a stipulation to the contrary
Is not aware of the hidden defects, will he be liable
yes unless there is a contrary stipulation
What are the remedies of the buyer in case of hidden defects
withdraw from the contract plus damages (restitution)
proportionate reduction of the price damages
What are the liabilities of the cellar if the loss of the thing with hidden defect is caused by the defect itself (PIED)
price
expenses of the contract
interest if in good faith
damages if in bad faith
If the thing with hidden defects is lost through a fortuitous event or through the fault of the buyer, what is the liability of the seller
refund the price less the value of the thing at the time of loss
plas damages if he was aware
The prescriptive period of the remedy in case of hidden defects is
6 months from delivery
The redhibitory the effect of one shall only give rise to its redhibition and not of the others except if the vendee would not have purchased
yes
This or the sales without implied warranty against hidden defects
second hand
junk shop
auction
The sale of animals suffering contagious disease or animals unfit for purpose intended are
void
The buyer may examine the goods except when
stipulated
no delivery until payment
cash on delivery
Prescriptive period of the rights of actions of a buyer of animals with redhibitory defects
40 days
What are the remedies of the buyer in case of non apparent encumbrances
rescission
damages
1 year prescriptive period from execution of the deed and from discovery
Is the buyer required to return the thing if the refusal of acceptance of the buyer is justified
no
The implied warranties or not applicable to
sheriff, auctioneer, mortgagee, pledgee or other persons professing to cell by virtue of authority in fact or law
When shall a buyer be liable to pay interest
between delivery to payment
When can a buyer suspend payments
when disturbed in the possession or ownership of the thing or reasonable grounds to fear such disturbance until such disturbance or danger ceases
unless the seller gives security; when is stipulated; or merely an act of trespass
When can a vendor exercise rescission
unpaid seller
subject is immovable property
reasonable fear of loss of the property
Notice to the seller is necessary for him to be liable for breach of contract
yes
It shall take place when the vendor reserves the right to repurchase the thing, with the obligation to return the price, expenses related thereto and useful and necessary expenses and other stipulations which may have agreed upon
conventional redemption or pacto de retro sale
If a buyer subsequently of course the whole undivided immovable property, can he compel the seller to redeem the whole property if the latter exercises the right of redemption
yes
Is conventional redemption subject to a suspensive condition
no, resolutory condition
Prescriptive period for the exercise of conventional redemption
4 years if no stipulation
up to 10 years if stipulated
30 days from the final judgement was rendered in a civil action on the basis that the contract was a true sale with right to purchase
If a purchaser paid for the fruits existing at the time of sale and there were fruits as well at the time of redemption, is he entitled to reimbursement or prorating of the fruits existing at the time of redemption
yes
What is the treatment of the fruits which did not existed at the time of sale what at the time of redemption
prorated between the redemption and the buyer
A sale with right of repurchase is presumed to be an equitable mortgage in the following cases
- When the price of a sale with the right to repurchase is _____________
- When the vendor remains in possession as ________
- When upon or after the expiration of the right to repurchase a new instrument extending the period of redemption or granting a new period Is executed
- When the purchaser _____________ a part of the purchase price
- When the vendor binds himself to ____________
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
unusually inadequate; lessee; retains for himself; pay the taxes on the thing
Through this, it means that the ownership of the buyer becomes absolute and the resolutory condition is removed
consolidation of ownership
If several persons jointly and in the same contract sell an undivided immovable with a right to repurchase
the seller can redeem _____________
the buyer can ________________
only their share
compel redemption of the entire property and cannot be compelled to agree to partial redemption
What rule shall apply to coheirs of the seller
several persons jointly and in the same contract selling and undivided immovable property
The coheirs of the buyer, is it the whole property or each of their own share can be subjected for an action of redemption
the action for redemption should be to each for his own share
It is 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 dacion in payment or by any other transactions whereby the ownership is transmitted by onerous title
legal redemption
These are the persons who can exercise the right of legal redemption
co-owners when the property is sold to a third person
owners of adjoining lands
What is the subject property in case of a right of legal redemption of a coo-owner
movable or immovable property
How is the right of redemption exercise should two or more co-owners desire to do so
they only do so in proportion to the share they may respectively have
How much is the amount to be paid for redemption
the purchase price unless grossly excessive
The subject of a legal redemption in case of owners of adjoining rural land is
a rural land which does not exceed one hectare which is not separated by groups and other apparent servitude
In case two or more adjoining owners of a rural and desire to exercise the right of redemption at the same time who shall be preferred
smaller area
first requested
Who has a better right between a co-owner and an adjoining rural lot owner
co-owner
What are the requisites in case of redemption and preemption of sale of urban land
area of the land is so small and therefore can not be used for any practical purpose having been bought merely for speculation
Who is preferred in case multiple persons exercises the right of redemption or preemption
intended use is best justified
Are you to exercise legal right of redemption
30 days from notice in writing by the prospective vendor or by the vendor
the deed shall not be recorded in the registry of property unless accompanied by an affidavit of the vendor that he has given written notice thereof to all redemptioners
