Sales Flashcards

1
Q

Sale
- 2 parties : Seller (Vendor) and Buyer (Vendee)
- what is the obligation of seller? of buyer?

A

Seller - to transfer ownership + to deliver determinate thing
Buyer - to pay a price certain in money

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2
Q

Characteristics of Contract (BCCNOP)

A
  • Bilateral
  • Consensual
  • Commutative
  • Nominate
  • Onerous
  • Principal
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3
Q

Essential Requisites (COC)

A
  • Consent
  • Object
  • Cause
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4
Q

Consent
- meeting of minds
(1) upon the thing
(2) upon the price

A

Yes

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5
Q

Service can be an object in a contract of sale. True or False?

A

False (only thing or right)
- since purpose is to transfer ownership

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6
Q

Indeterminate thing may be an object in a contract of sale. True or False?

A

True (Generally : Determinate Thing)
- However, indeterminate thing who are physically segregated → determinate na → can be an object in a contract of sale

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7
Q

Another Requisites of Object
- must be within commerce of men (licit)
- seller must have a right to transfer ownership at time it is delivered

A

at time it is delivered (not perfection)

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8
Q

From the flashcard above, it stated “at time it is delivered”. Thus, future goods can be an object in a contract of sale.

Other term for “sale of future things”

A

Emptio Rei Speratae - valid

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9
Q

Other term for “sale of hope or expectancy”

A

Emptio Spei - valid
- example → lotto ticket

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10
Q

Can future inheritance, being a future thing, be an object in a contract of sale?

A

NO

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11
Q

Sale of vain hope is valid. True or False?

A

False (void)

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12
Q

In a contract of sale, the cause we are talking about is “price”.

A

YES

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13
Q

Price must be certain
- fixed by the parties
- with reference to another thing certain
- determination of price is left to will of a 3rd person

What will happen if the 3rd party is in bad faith or mistake?

A

court may fix the price

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14
Q

Price must be certain
- fixed by the parties
- with reference to another thing certain
- determination of price is left to will of a 3rd person

What will happen if the 3rd party is prevented by the seller/buyer?

A
  1. Fulfillment + Damage
  2. Rescission + Damage
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15
Q

Price must be certain
- fixed by the parties
- with reference to another thing certain
- determination of price is left to will of a 3rd person

What will happen if the 3rd party is unwilling or unable to determine a price?

A

contract is not effective

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16
Q

Gross inadequacy of price does not affect a contract of sale. True or False?

A

False (Generally : True)
- However, if there’s a defect in consent or the parties really intended it to be a donation → it affects the contract of sale

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17
Q

A contract of sale may be oral or written (subject to Statute of Frauds). True or False?

A

True
- Personal Property → at least 500
- Real Property → any amount

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18
Q

In a sale of piece of land made through an agent, the authority of A is oral. What wil be the status of the contract of sale?

A

VOID (not unenforceable)

19
Q

In a sale of piece of land made through an agent, the authority of A is written. From Agent (A) to Buyer (B), it is oral. What wil be the status of the contract of sale?

A

Unenforceable (statute of frauds)

20
Q

In a sale of piece of land made through an agent, the authority of A is written. From Agent (A) to Buyer (B), it is also written. What wil be the status of the contract of sale?

21
Q

Kinds as to Transfer of Ownership
- Absolute
- Conditional

What about contract to sell?

A

Absolute
- there is already a transfer of ownership if delivered (whether actual or constructive), even if payment is not yet complete

Conditional
- transfer of ownership will happen upon fulfillment of condition

Contract to Sell → is a conditional sale. However, transfer of ownership happens only upon execution of a deed of sale

22
Q

Contract of Sale or Agency to Sell
- there is transfer of onwership

A

Contract of Sale
- Agency to Sell → no transfer (only right to sell property)

23
Q

Contract of Sale or Agency to Sell
- after delivery, buyer bears the risk of loss

A

Contract of Sale
- Agency to Sell → risk of loss remains to the principal (not transferred to the agent)

24
Q

Contract of Sale or Contract for Piece of Work
- special order

A

Contract for Piece of Work
- Contract of Sale → in the ordinary course of business (whether on hand or not - kahit di pa napproduce)

25
Q

In a sense, parang same lang yung contract of sale at yung contract for piece of work. Bakit need pa sila idistinguish sa isa’t-isa?

A

Contract of Sale = covered by Statute of Frauds
Contract for Piece of Work = X

Kaya if ever may sale of real property na P300 lang at contract for piece of work yon, valid pa rin siya (hindi unenforceable)

26
Q

If consideration is partly in money, partly in kind. Is it a contract of sale or barter?

A

Depends
1. Intention of Parties
2. If intention is not clear
a. Thing > (it is a barter)
b. Thing ≤ (it is a sale)

Example
- money = 5,000
- in kind = 5,000

This is a “sale” since less than or equal to. If the value of in kind is 5,001, it is a “barter”

27
Q

If the promise to buy and/or sell is bilateral (mutual promise), it is reciprocally demandable. True or False?

28
Q

If the promise to buy and/or sell is unilateral, and it is not accepted by the offeree, there is a contract. True or False?

A

False (there is no contract)

29
Q

If the promise to buy and/or sell is unilateral, and it is accepted by the offeree, it is already binding to the offeror. True or False?

A

Depends

  • If no consideration (option money) → not binding to Seller. Seller can withdraw.
  • If with consideration (option money) → perfected option contract. Seller cannot withdraw.
30
Q

Always remember to look out for this.
Sale - period to pay
Option - period to decide

31
Q

If you pay earnest money, it is a proof of a perfected contract of sale. True or False?

A

True “earnest” kaya magiging part siya ng purchase price
- Option → no perfected sale yet (not part of purchase price unless agreed)

32
Q

Obligations of the Vendor
- to take care of the thing
- to transfer ownership

A
  • to take care of the thing = after perfection, before delivery
  • to transfer ownership = upon delivery (however, parties may agree)
33
Q

Who Bears Risk of Loss
- Before Perfection
- At Perfection
- Perfected, Before Delivery
- Perfected, After Delivery

Res Perit Domino - who owns suffer the loss

A

Seller
- Before Perfection
- At Perfection

Buyer
- Perfected, Before Delivery
- Perfected, After Delivery

34
Q

Kinds of Delivery
- Actual Delivery
- Constructive Delivery

35
Q

Constructive Delivery
- Execution of Public Instrument
- Symbolic Delivery
- Traditio Longa Manu
- Traditio Brevi Manu
- Constitutum Possessorium

A
  • Execution of Public Instrument
  • Symbolic Delivery → e.g. keys
  • Traditio Longa Manu → by pointing, must be agreed
  • Traditio Brevi Manu → Buyer is in possession
  • Constitutum Possessorium → seller is in possession
36
Q

What law applies to installment, personal property?

REPER

37
Q

What law applies to installment, real property?

MARE
What RA number?

A

Maceda Law (RA 6552)

38
Q

Recto law is for the benefit of buyer. True or False?

A

True
- since ang remedies of seller is alternative (can only choose 1), parang pinoprotect yung buyer

39
Q

Maceda law is for the benefit of buyer. True or False?

A

True
- since rights of buyer

40
Q

In Recto Law, what is the remedy of the seller
- in case 1 or more installments is unpaid
- in case 2 or more installments are unpaid

3 remedies

A

1 or more installment
1.exact fulfillment

2 or more installment
2.cancel the sale
3.foreclose chattel mortgage

41
Q

What to remember in “foreclose chattel mortgage”?

A
  • Seller cannot recover deficiency
  • It is an absolute rule
42
Q

In Maceda Law, what is the rights of the buyer
- if paid less than 2 years of installment

Grace Period - how many days?
What if buyer still did not pay within the grace period?
Unlimited ba yung pag avail sa grace period?

A
  • Grace Period = 60 days

If still fail to pay, seller may cancel / rescind contract
- after 30 days from notice to rescind

Grace Period = can only be applied once every 5 years

43
Q

In Maceda Law, what is the rights of the buyer
- if paid at least 2 years of installment

Grace Period - how many days?
What if buyer still did not pay within the grace period?
Unlimited ba yung pag avail sa grace period?

A
  • Grace Period = 60 days (+ 1 month for every 1 year after the 2-year requirement)

If still fail to pay, seller may cancel / rescind contract
- after 30 days from notice to rescind
- + payment of CSV

Grace Period = can only be applied once every 5 years

44
Q

How to compute Cash Surrender Value?

What is the maximum?

A

= 50% of total payments made
‘+ 5% per year (after 5 years)

Maximum → 90%

For example, if 7th year
50% + 10%
10% = 5% x 2 years (7-5)