SALES-ATTY.

BUSMENTE-SBCA-AY20172018-1ST SEMESTER-CASE DOCTRINES

JULY 24, 31, 2017

1. DIGNOS vs. CA, 158 SCRA 375
DOCTRINE: Valid contract of sale even though the vendee paid in installment, all
elements for contract of sale are present, and there was already an actual delivery to the
vendee by the vendors and already exercising possession over the subject land.

2. TAN vs. BENORILAO, G.R. No. 153820, October 16, 2009

DOCTRINE: Contract of sale vs. Contract to sell: The essence of a contract of sale is the
transfer of ownership in exchange for a price paid or promised. A contract to sell is a
bilateral contract whereby the prospective seller expressly reserving the ownership of the
property binds himself to sell the property exclusively to the prospective buyer upon
fulfillment of the condition agreed.

3. ARTATES vs. URBI, G.R. No. L-29421, January 30, 1971

DOCTRINE: Illicit per accidens, the land could not be subject to sale since it is protected
by the Public Land Act that grants ownership of the homestead patent to the owners for 5
years hence, the land could not be subject to pay for the damages accrued by one of the
spouses.

4. HEIRS OF ENRIQUEZ ZAMBALES vs. CA, 120 SCRA 897

DOCTRINE: There was legal capacity of the spouses Zambales even though they were
deaf, they were able to hire prominent and credible lawyers thus, showing that there was
no misinterpretation nor fraud in acquiring their consent. However, the homestead patent
is still covered by the Public Land Act, thus, ownership is retained.

5. QUIROGA vs. PARSONS, 38 PHIL. 501

DOCTRINE: It is a contract of a sale and not contract of agency to sell because of the
presence of essential clauses in the contract and all essential requisites of a contract of sale
were present.

6. CONCRETE AGGREGATES INC. vs. CTA, 185 SCRA 461

DOCTRINE: They were engaged in a contract of sale and as a manufacturer and not a
contractor since their products was available to the general public.

7. PEOPLESS HOMESITE & HOUSING CORP. vs. CA, 133 SCRA 777
DOCTRINE: In conditional obligations, the acquisition of rights, as well as the
extinguishment or loss of those already acquired, shall depend upon the happening of the
event which constitutes the condition.

8. TOYOTA SHAW, INC. vs. CA, 244 SCRA 320

DOCTRINE: There was no full purchase price negotiated, thus, there is no price certain in
the agreement, hence, lacking one of the essential requisites for a contract of sale. It cannot
bind appellee in the contract since the sales representative was the only one who contracted
with the buyer.

ARCILLA-BAYBAY-CALUB-CATALO-ENRIQUEZ-MENDOZA-ROXAS-SY-TIO
 SALES-ATTY. BUSMENTE-SBCA-AY20172018-1ST SEMESTER-CASE DOCTRINES

9. SAMPAGUITA PICTURES vs. JALWINDOR MANUFACTURERS, INC., 93 SCRA

420
DOCTRINE: Ownership is not transferred by perfection of the contract but by delivery,
either actual or constructive. Payment of the purchase price is not essential to the transfer
of ownership as long as the property sold has been delivered. Ownership is acquired from
the moment the thing sold was delivered to vendee, as when it is placed in his control and
possession.

AUGUST 7, 2017
10. SOUTHWESTERN SUGAR & MOLASSES vs. ATLANTIC GULF, 97 PHIL 247
DOCTRINE: An option contract to be valid must have consideration distinct from the price.
Thus, it can be withdrawn due to no consideration.

11. ATKINS, KROLL, AND CO., INC. vs. CUA HIAN TEK, 102 PHIL 247
DOCTRINE: If the option is given without consideration, it is a mere offer of a contract of
sale, which is not binding until accepted. If, however, accepted is made before a withdrawal,
it constitutes a binding contract of sale even though the option was not supported by a
sufficient consideration.

12. NATINO vs. IAC, 197 SCRA 323

DOCTRINE: An option contract unsupported by consideration distinct from purchase price
is not binding upon the promisor.

13. SERRA vs. CA, 229 SCRA 60

DOCTRINE: The court ruled that the contract of "lease with option to buy" between the
petitioner and respondent bank is valid, effective and enforceable, the price being certain and
that there was a consideration distinct from the price to support the option given to the lease.
In the present case, the consideration is more onerous on the part of the lessee since
it entails transferring of the building and/or improvements on the property to petitioner,
should respondent bank fail to exercise its option within the period stipulated. We do not find
the situation in the present case to be inequitable.

14. ROMAN vs. GRIMALT, G.R. No. 2412, April 11, 1906 (1 PHIL 96)
DOCTRINE: The sale of the schooner was not perfected and the purchaser did not consent
to the execution of the deed of transfer for the reason that the title of the vessel was in the
name of one Paulina Giron and not in the name of Pedro Roman, the alleged owner. If no
contract of sale was actually executed by the parties the loss of the vessel must be borne by
its owner and not by a party who only intended to purchase it and who was unable to do so
on account of failure on the part of the owner to show proper title to the vessel and thus
enable them to draw up the contract of sale. The defendant was under no obligation to pay
the price of the vessel, the purchase of which had not been concluded. The conversations had
between the parties and the letter written by defendant to plaintiff did not establish a contract
sufficient in itself to create reciprocal rights between the parties

15. EQUATORIAL REALTY DEVELOPMENT, INC. vs. MAYFAIR THEATER, INC., 264
SCRA 483

ARCILLA-BAYBAY-CALUB-CATALO-ENRIQUEZ-MENDOZA-ROXAS-SY-TIO
 SALES-ATTY. BUSMENTE-SBCA-AY20172018-1ST SEMESTER-CASE DOCTRINES

DOCTRINE: An option is a contract granting a privilege to buy or sell within an agreed time
and at a determined price. It is a separate and distinct contract from that which the parties
may enter into upon the consummation of the option. It must be supported by consideration.
In the instant case, the right of first refusal is an integral part of the contracts of lease. The
consideration is built into the reciprocal obligations of the parties.

16. NORKIS DISTRIBUTORS INC. vs. CA, 193 SCRA 694

DOCTRINE: The issuance of a sales invoice does not prove transfer of ownership of the
thing sold to the buyer. An invoice is nothing more than a detailed statement of the nature,
quantity and cost of the thing sold and has been considered not a bill of sale. The critical
factor in the different modes of effecting delivery, which give legal effect to the act, is the
actual intention of the vendor to deliver, and its acceptance by the vendee. Without that
intention, there is no tradition.

AUGUST 14, 2017

17. SOUTHERN MOTORS INC. vs. MOSCOSO, 2 SCRA 168
DOCTRINE: The complaint is an ordinary civil action for recovery of the remaining
unpaid balance due on the promissory note (first option). Had appellee elected the
foreclosure, it would not have instituted this case, in court; it would not have caused the
chattel to be attached under rule 59, and had it sold at public auction, in the manner
prescribed by Rule 39. Theres no foreclosure (third option) at all. The public sale was the
result of the court judgment.

18. PASCUAL vs. UNIVERSAL MOTORS CORP., 61 SCRA 121

DOCTRINE: Article 1484 is not applicable. The contention that what Article 1484
withholds from the vendor is the right to recover any deficiency from the purchaser after
the foreclosure of the chattel mortgage and not a recourse to the additional security put up
by a third party to guarantee the purchasers performance of his obligation is untenable.
What cannot be violated directly cannot be violated indirectly.

19. FILINVEST CREDICT CORP. vs. CA, 178 SCRA 188

DOCTRINE: The real intention of the parties should prevail. The nomenclature of the
agreement cannot change its true essence. It is apparent here that the intent of the parties to
the subject contract is for the so-called rentals to be the installment payments. Upon the
completion of the payments, then the rock crusher, subject matter of the contract, would
become the property of the private respondents.

20. RIDAD vs. FILIPINAS INVESTMENTS, G.R. No. L-39806

DOCTRINE: Under Article 1484 of the Civil Code, the vendor of personal property, the
purchase of which is payable in installments, has the right, should the vendee default in the
payment of two or more of the agreed installments, to exact fulfillment by the purchaser of
the obligation, or to cancel the sale, or to foreclose the mortgage on the purchased personal
property, if one was constituted. Whichever right the vendor elects he cannot avail of the
other.

ARCILLA-BAYBAY-CALUB-CATALO-ENRIQUEZ-MENDOZA-ROXAS-SY-TIO
 SALES-ATTY. BUSMENTE-SBCA-AY20172018-1ST SEMESTER-CASE DOCTRINES

21. SPOUSES DE LA CRUZ vs. CA, G.R. No. 94828, September 18, 1992
DOCTRINE: The instant case is covered by the so-called "Recto Law", now Art. 1484 of
the New Civil Code, which provides: "In a contract of sale of personal property the price of
which is payable in installments, the vendor may exercise any of the following remedies: (1)
Exact fulfillment of the obligation, should the vendee fail to pay; (2) Cancel the sale, should
the vendee's failure to pay cover two or more installments; (3) Foreclose the chattel mortgage
on the thing sold, if one has been constituted, should the vendee's failure to pay cover two or
more installments. In this case, he shall have no further action against the purchaser to
recover any unpaid balance of the price. Any agreement to the contrary shall be void." In this
jurisdiction, the three (3) remedies provided for in the "Recto Law" are alternative and not
cumulative; the exercise of one would preclude the other remedies. Consequently, should the
vendee-mortgagor default in the payment of two or more of the agreed installments, the
vendor-mortgagee has the option to avail of any of these three (3) remedies: either to exact
fulfillment of the obligation, to cancel the sale, or to foreclose the mortgage on the purchased
chattel, if one was constituted.

22. AGUSTIN vs. CA, G.R. No. 107846, April 18, 1997
DOCTRINE: Where the mortgagor plainly refuses to deliver the chattel subject of the
mortgage upon his failure to pay two or more installments, or if he conceals the chattel to
place it beyond the reach of the mortgagee, what then is the mortgagee expected to do? It
logically follows as a matter of common sense, that the necessary expenses incurred in the
prosecution by the mortgagee of the action for replevin so that he can regain possession of
the chattel, should be borne by the mortgagor. Recoverable expenses would, in our view,
include expenses properly incurred in effecting seizure of the chattel and reasonable
attorneys fees in prosecuting the action for replevin.

23. FIESTAN vs. CA, 185 SCRA 751

DOCTRINE: The prohibition mandated by par. (2) of Article 1491 in relation to Article 1409
of the Civil Code does not apply in the instant case where the sale of the property in dispute
was made under a special power inserted in or attached to the real estate mortgage pursuant
to Act No. 3135, as amended.

24. BORBON II vs. SERVICEWIDE SPECIALIST, INC., 258 SCRA 634

DOCTRINE: The remedies under Article 1484 of the Civil Code are not cumulative but
alternative and exclusive. Should the vendee or purchaser of a personal property default in
the payment of two or more of the agreed installments, the vendor or seller has the option to
avail of any of these three remedies either to exact fulfillment by the purchaser of the
obligation, or to cancel the sale, or to foreclose the mortgage on the purchased personal
property, if one was constituted. These remedies have been recognized as alternative, not
cumulative, that the exercise of one would bar the exercise of the others.

SEPTEMBER 4, 2017
25. DIZON vs. SUNTAY, 47 SCRA 160
DOCTRINE: The controlling provision is Article 559 of the Civil Code. It reads thus: 'The
possession of movable property acquired in good faith is equivalent to a title. Nevertheless,

ARCILLA-BAYBAY-CALUB-CATALO-ENRIQUEZ-MENDOZA-ROXAS-SY-TIO
 SALES-ATTY. BUSMENTE-SBCA-AY20172018-1ST SEMESTER-CASE DOCTRINES

one who has lost any movable or has been unlawfully deprived thereof may recover it from
the person in possession of the same. If the possessor of a movable lost of which the owner
has been unlawfully deprived, has acquired it in good faith at a public sale, the owner cannot
obtain its return without reimbursing the price paid therefor.

26. EDCA PUBLISHING & DISTRIBUTING CORP. vs. SANTOS, 184 SCRA 614
DOCTRINE: Ownership in the thing sold shall not pass to the buyer until full payment of
the purchase only if there is a stipulation to that effect. Otherwise, the rule is that such
ownership shall pass from the vendor to the vendee upon the actual or constructive delivery
of the thing sold even if the purchase price has not yet been paid. Actual delivery of the books
having been made, Cruz acquired ownership over the books which he could then validly
transfer to the private respondents. The fact that he had not yet paid for them to EDCA was
a matter between him and EDCA and did not impair the title acquired by the private
respondents to the books.

27. LAYUG vs. IAC, 167 SCRA 627

DOCTRINE: R.A. 6552 governs sales of real estate on installments. It recognizes the
vendor's right to cancel such contracts upon failure of the vendee to comply with the terms
of the sale, but imposes, chiefly for the latter's protection, certain conditions thereon.

28. POWER COMMERCIAL & INDUSTRIAL CORP. vs. CA, 274 SCRA 597
DOCTRINE: (I)n order that this symbolic delivery may produce the effect of tradition, it is
necessary that the vendor shall have had such control over the thing sold that xxx its material
delivery could have been made. It is not enough to confer upon the purchaser the ownership
and the right of possession. The thing sold must be placed in his control. When there is no
impediment whatever to prevent the thing sold passing into the tenancy of the purchaser by
the sole will of the vendor, symbolic delivery through the execution of a public instrument
is sufficient. But if, notwithstanding the execution of the instrument, the purchaser cannot
have the enjoyment and material tenancy of the thing and make use of it himself or through
another in his name, because such tenancy and enjoyment are opposed by the interposition
of another will, then fiction yields to reality -- the delivery has not been effected.

29. ADDISON vs. SPS. FELIX & TIOCO, 38 PHIL 404

DOCTRINE: it is enough to confer upon the purchaser the ownership and the right of
possession. The thing sold must be placed in his control. When there is no impediment
whatever to prevent the thing sold passing into the tenancy of the purchaser by the sole will
of the vendor, symbolic delivery through the execution of a public instrument is sufficient.
But if, notwithstanding the execution of the instrument, the purchaser cannot have the
enjoyment and material tenancy of the thing and make use of it himself or through another
in his name, because such tenancy and enjoyment are opposed by the interposition of another
will, then fiction yields to reality the delivery has not been effected.

30. TEN FORTY REALTY & DEVT CORP. vs. CRUZ, G.R. No. 151212
DOCTRINE: This Court has held that the execution of a public instrument gives rise only to
a prima facie presumption of delivery. Such presumption is destroyed when the delivery is
not effected because of a legal impediment. Pasagui v. Villablanca had earlier ruled that such

ARCILLA-BAYBAY-CALUB-CATALO-ENRIQUEZ-MENDOZA-ROXAS-SY-TIO
 SALES-ATTY. BUSMENTE-SBCA-AY20172018-1ST SEMESTER-CASE DOCTRINES

constructive or symbolic delivery, being merely presumptive, was deemed negated by the
failure of the vendee to take actual possession of the land sold.

In Ten Forty vs Cruz and Addison vs Felix, the occupants occupying the land are in
possession in the concept of an owner, therefore it constitutes as a legal impediment.
Example in the case of Addison, the respondent could not acquire the land, for at the time of
the sale, the land was subject in a land registration proceeding, where it could mean that the
respondent even if such land was sold to her, she could not possess nor control over it. Unlike
in Power Commercial vs CA, the tenants (squatters) are in the possession of land, but not as
an owner but a lessee, therefore it could not constitute as legal impediment, for they are just
mere lessees, it could never defeat the right of a lessor.

ARCILLA-BAYBAY-CALUB-CATALO-ENRIQUEZ-MENDOZA-ROXAS-SY-TIO