sales <3 (excluding seller and buyer obligations)

Question 1

basics

what’s the definition of a sale

Answer 1

bilateral contract whereby a person transfers ownership of a thing to another for a price in money (thus, basic requirements are thing, price, consent)

Question 2

validity of a sale

when does ownership transfer generally

Answer 2

upon agreement as to thing and price (consent element of valid sale)

Question 3

validity of a sale

what general obligations concept applies to an acceptance not in accordance with the offer

Answer 3

an acceptance not in accordance with the terms of the offer is deemed a counteroffer

Question 4

validity of a sale

what general obligations concept applies to the thing requirement

Answer 4

object must be (1) lawful; (2) possible; and (3) determined or determinable (object must be determined at least to its kind –quantity may be undetermined, provided it is determinable)

Question 5

validity of a sale

what can be the thing (object) of a sale

Answer 5

all things, incorporeal or corporeal, that are susceptible of ownership may be the object of a sale unless prohibited by law

Question 6

validity of a sale

what is a sale of a hope

Answer 6

it is an aleatory contract; the buyer assumes the risk that the thing will not materialize

Question 7

validity of a sale

what is the sale of a future thing

Answer 7

a sale subject to a suspensive condition – the buyer does not assume the risk
* a suspensive condition is one that suspends the effects of a contract –ownership and ROL transfer to the buyer retroactive to the date of a contract if the event happens; if not, remains with the buyer

Question 8

validity of a sale

what is the general requirement for price

Answer 8

must be a sum certain or determinable through a method agreed upon by the parties

Question 9

validity of a sale

when can the court fix the price of a sale

Answer 9

once the parties have agreed to have the price fixed by a third party –if they fail to name a person or if their agreed-upon person does not fix the price

Question 10

validity of a sale

what are the requirements for lesion beyond moiety

Answer 10

1. sale of a corporeal immovable
2. price is less than 1/2 the FMV at the time of sale
3. either return the thing or pay the supplement price

Question 11

validity of a sale

what are the limitations of lesion beyond moiety

Answer 11

not waivable in advance and is subject to a peremptive period of 1 year from the date of sale

Question 12

validity of a sale

what are the available remedies for lesion beyond moiety

Answer 12

1. buyer still in possession: return the immovable to the seller or pay the supplement and keep the immovable
2. buyer no longer in possession: seller cannot get the thing back, but can get profit realized by his buyer who resold (recovery capped at supplement price)

Question 13

validity of a sale

if a sale is preceded by an option contract and the seller seeks to bring a lesion beyond moiety claim, how is the determination made as to whether price was lesionary

Answer 13

made by evaluating the property value at the time the option contract was made

Question 14

form requirements

what is the general rule for offer and acceptance

Answer 14

offer and acceptance can be made orally, in writing, or by action/inaction that under the circumstances are clearly indicative of consent, unless otherwise required by law

Question 15

form requirements

what is required for the sale of an immovable

Answer 15

need a writing for transfer or sale (AA or AUPS)

exception: transfer can be made orally if (1) property has been actually delivered and (2) the transferor (seller) recognizes the transfer when interrogated under oath

Question 16

form requirements

what is required in the parties’ agreement if a writing is required

Answer 16

1. consent of the parties
2. property description –reference to an official governmental survey, by metes and bounds, by reference to the map or play of a subdivision

Question 17

ownership & ROL

generally, when does ownership pass to buyer

Answer 17

upon perfection of a sale (consent as to thing and price, thing, price)

Question 18

ownership & ROL

when does ROL transfer to buyer

Answer 18

upon delivery (generally)

Question 19

ownership & ROL

when does ownership and risk of loss transfer for sales by weight, tale, or measure

Answer 19

ownership passes upon weighing, counting, and measuring (only have full price once measured); ROL transfers upon weighing, counting, and measuring + delivery

Question 20

ownership & ROL

when does ownership and risk of loss transfer for a lump sale for a lump price

Answer 20

ownership is transferred upon consent (GR), even though things haven’t been measured yet; ROL transfers upon delivery

Question 21

prepatory contracts

what is the definition of an option contract

Answer 21

a unilateral contract to sell or buy whereby the grantor is bound if the grantee accepts within the time stipulated

Question 22

prepatory contracts

what are the requirements for an option contract

Answer 22

1. CCCO
2. thing
3. price
4. term (specified or piggybacked off K)
5. writing for immovables

Question 23

prepatory contracts

what are the time limits for an option contract

Answer 23

• if immovable: 10 year max time (reduced if longer)
• if option is part of another contrat, option’s term is coextensive
• if other contract has an indefinite duration, option K is invalid for lack of a definite term

Question 24

prepatory contracts

what’s the definition of a right of first refusal

Answer 24

unilateral contract where one party agrees that she won’t sell a certain thing without first offering it to a certain person. the grantor may not sell to a third party without first offering to sell to holder of right

Question 25

prepatory contracts

what are the requirements for a ROFR

Answer 25

1. CCCO
2. thing
3. writing for immovables

Question 26

prepatory contracts

what are the time limits for a ROFR

Answer 26

1. if immovable: 10 year max (reduced if longer)
2. exception: can be longer if granted in connection with contract for continuous or periodic performance

Question 27

prepatory contracts

what is the definition of a contract to sell

Answer 27

bilateral contract where parties promise to enter into a contract at a later date

Question 28

prepatory contracts

what’s required for a contract to sell

Answer 28

1. CCCO
2. thing
3. price
4. writing for immovables

Question 29

prepatory contracts

what are the time limits for a contract to sell

Answer 29

NO MAX TIME. REASONABLE TIME.

Question 30

prepatory contracts

how is a ROFR enforced

Answer 30

specific performance

Question 31

prepatory contracts

how is a ROFR accepted or rejected

Answer 31

10 days to exercise right if the thing is movable and 30 if immovable

failure to timely accept terminates right

Question 32

prepatory contracts

what happens to ROFR if the holder doesn’t decide to buy the thing

Answer 32

the right remains in the holder unless the grantor concludes a final sale, or a K to sell, with a third party within 6 months

Question 33

prepatory contracts

how is a contract to sell enforced

Answer 33

specific performance

Question 34

prepatory contracts

what is earnest money

Answer 34

an amount given to the seller by buyer to secure parties’ interests in the case of breach; parties must expressly stipulate that the sum is earnest money

Question 35

prepatory contracts

what is the effect of earnest money

Answer 35

negates the ability to demand specific performance and recovery of actual damages

Question 36

prepatory contracts

if parties recede from a contract to sell in which earnest money has been provided, what are the results

Answer 36

1. buyer recedes –forfeits money given to seller
2. seller recedes –must return double the amount of earnest money
3. party’s failure to perform is excused –earnest money is not owed

Question 37

prepatory contracts

where must a contract to sell be filed to be effective as to third parties

Answer 37

conveyance records

Question 38

prepatory contracts

where must an option to buy an immovable be recorded to be effective against third parties

Answer 38

conveyance records in the parish where the immovable property is located

Question 39

prepatory contracts

when are prepatory contracts regarding movables binding on third parties

Answer 39

third party acquires conflicting rights with actual knowledge

Question 40

prepatory contracts

what is the doctrine of implied warranty of merchantability

Answer 40

protects a buyer from being compelled to accept a flawed title; the buyer may refuse to enter into the sale if the title is suggestive of serious litigation