SALES AND OTHER CONT! Atty. Sherrymae O. Velos Prerequisite Subject: Obligations and Contracts Class Schedule: First Semester AY 2018-2019, every Friday (5:45PM - 7:45PM) Units: ZZ nours a week) ‘Consultation Lime: 1:0UPM-3:00PM Mon-tri Course Description: An in-depth consideration of the provisions of the Civil Code on the contract of sale, its nature and form, the obligations of the vendor and the vendee, warranties and remedies against breach of contract, the modes of extinguishment of the contract, and conventional and legal redemption. The course includes assignment of credits, and incorporeal rights, the provisions on Lease, the Bulk Sales Law and the Nationalization Law. Course Objectives: 1. Understand the basic principles applicable to a contract of sale, lease and other contracts. 2. Identify the rights and obligations of parties to a contract of sale, lease and other contracts. 3. Appreciate and apply these fundamental principles to actual business transactions. 4. Encourage diligence and the observance of honesty and fair dealings at all times, especially in the application of application of COURSE OUTLINE Definition - Art. 1458(1) Ang Yu Asuncion v. Court of Appeals, 238 SCRA 602, December 2, 1994 Vda, De Ape v. Court of Appeals, 456 SCRA 193, April 15, 2005 Torcuator v. Bernaive, 459 SCRA 439, June 8, 7005 2. History Governing Law ~ RA No. 386 (August 30, 1950); Arts. 1488, 1637 ‘Commercial & Civil Sales 3. Characteristics- Art. 1475, Art. 1458, Art. 1350, Art. 2010, Art. 1458 Gaite v. Fonacier, 2 SCRA 830, July 31, 1961 4. Stages a. Negotiation b. Perfection — Arts. 1315, 1475 ¢. Performance - Arts. 1191, 1403(2) d, Consummation- Ainza v, Padua, 462. "RA 614, June 30, 2005 ,, Recto Law, 1477, 154 | 456 SCRA 577, April 22, 2005 Heirs of Jesus M. Mascunana v. Court of Appeals, 461 SCRA 186, June 23, 2005 Ursal v. Court of Appeals, 473 SCRA 52, October 14, 2005 Carrascoso, Jr. v. Court of Appeals, 477 SCRA 666, December 14, 2005 Sacobia Hills Dev"t Corp. v. Ty, 470 SCRA 395, September 20, 2005 Adao, 4 October i9, Edrada v. Ramos, 468 SCRA 597, August 31, 2005 6. Distinguished from other transactions a. Contract for a Piece of Work (Massachusetts Rule) - Art. 1467 . “Contract of Lease with Option to Buy” ¢. Dacion en Pago — Art. 1245 d. Barter or Exchange ~ Arts. 1468, 1638, 1954 ©. Agency to Sell — Art, 1466 Ker. Lingad, 38 SCRA 524, April 30, 1971 Del Monte Phils. v. Aragones, 461 SCRA 139, June 23, 2005 f 7. Essential Elements a. Consent of the contracting parties Parties to the Contract Capacity of Parties- Arts. 1489, 1390, 1403 1. absolute - Arts. 1327-1328, Art. 234Family Code (FC) as amended by RA 6809 2. reiative — Art. Xil, Sees. 7 & 8, 1987 ConstitutionArts. 1490-1492, 1533(5), 1476(4), 124FC, Estate of Salvador Serra Serra v. Heirs of Primitivo Hermaez, 466 SCRA 120, August 9, 2005 b. Subject matter (things & rights)- Arts. 1347, 1311, 1636(goods) Requisites- Arts. 1458(1), 1489-1462, 1347-1349 Ruies on tie object of a contract of saie- Ants. 1463-1465 Assignment of Credit and Other Incorporeal Rights- Arts. 1624-1635 ¢. Cause - Arts, 1350, 1352-1353 Price certain in money- Arts. 1469, 1471-1474, 1308; RA 529, RA8183, PD72 Eamest Money- Art. 1482 Lesion - Arts. 1470, 1355 Goldenrod v. Court of Appeals, 299 SCRA 141, November 24, 1998 Edrada v. Ramos, 468 SCRA 597, August 31, 2005 Philippine Free Press, Inc. v. Court of Appeals, 473 SCRA 639, October 24, 2005 Cruz v. Fernando, Sr., 477 SCRA 173, December 9, 2005 8, Natural Elements b. sul 9, Accidental Elements II. Perfection of the Contract 10. When perfected- Arts. 1475-1476, 1479(1) Cruz v. Fernando, Sr., supra 11. Contract of Option- Arts. 1479, 1324 Equaioriai Keaity Dev't, inc. v. Mayfair Theater, Inc., 264 SCRA 483, November i, 1996 12. Formalities of Contract of Sale (Statutes of Fraud) - Arts. 1483, 1403, 1625, 1356-1358, 1874; Sec. 22 Act 1147 (Cattle Registration Act) Dalion v. Court of Appeals, 182 SCRA 872, February 28, 1990 Yuvienco v. Dacuycuy, 104 SCRA 668, May 27, 1987 Vda. De Jomoc v. Court of Appeals, 200 SCRA 74, August 2, 1991 Santos v. Manalili, 475 SCRA 679, November 22, 2005 IV. __ Rights and Obligations of the Vendor - Art. 1495 13. To transfer ownership Who can transfer ownership? General Rule - Arts. 1505-1506, 1547, Cuison y, Remoto, 472 SCRA 274, October 11, 2005 Exceptions: Art Salonga v. Concepcion, 470 SCRA 291, September 20, 2005 Sigaya v. Mayuga, 467 SCRA 341, August 18, 2005 Premiere Dev't Bank v. Court of Appeals, 453 SCRA 630, March 18, 2005 When/How transfer is effected? - Arts. 1477, 1459, 1496, 1547, 1588 General Rule: Hlao-Quianay v, Mapile, 474 SCRA 246, October 25, 2005 Exceptions: 1. sale or return - Art. 1502(1) 2. sale on approval or trial Art. 1502(2) 3. conditional sales - Arts. 1478, 1503(1), 1458(2) Vallarta v. Court of Appeals, 150 SCRA 336, May 29, 1987 Risk of Loss or Deterioration (Total/Partial)- General Rule: Res perit domino -xceptions E 1. Stipulation 2. Security Title 3, Delay An 1544 fovables/Immovables) Ulep v, Court of Appeals, 472 SCRA 274, October 11, 2005 When not applicable? 1 unregistered lands14, 15. v. 17. 18. To deliver the object and its accessions - Art. 1537(1164) Kinds of Delivery of Incorporeal Property (Quasi-tradition) - Arts. 1501, 2095 Kinds of Delivery of Corporeal Property (Tradition) - Art. 1477 a. Actual (Real or Material) - Art. 1497 . Constructive (Symbolic or Formal) Daguiian v. IAC, 168 SCRA 22, November 26, 1956 Dy, Jr. v. Court of Appeals, 198 SCRA 826, July 8, 1991 Power Commercial and Ind’l Corp. v. CA, 274 SCRA 597, June 20, 1997 Quality/Quantity)- Arts, 1481, 1522, 1539-1543, 1630, 1632-1633 Rudolf Lietz, Inc. v. Court of Appeals, 478 SCRA 451, December 19, 2005 Not bound to detiver when? - Arts, 1524, 1536(1198) Warranties - Arts, 1495, 1567, 1571, 1628, 1629, 1631 a, Express- Art, 1546 Distinguished from: condition)- Art, 1545 ii, dealer's talk . Implied warranties i ‘warranty against eviction (warranty of title) )- Arts. 1548-1559 ii, warranty against hidden encumbrances or defects)- Arts. 1560, 1561, 1567-1581, 613, 615 iii, warranty of quality)- Arts. 1562-1565, 1586, 1599(5) Guinhawa v. People, 468 SCRA 278, August 25, 2005 Power Commercial and Ind’! Corp. v. CA, supra 16. Others- Arts. 1480, 1163, 1538, 1537, 1164, 1487, 1521 last par. Rights and Obligations of the Vendee Payment of Price - Arts, 1582, 1590, 1593 Time and Place Liability for interest - Art. 1589 Right of Inspection/Examination)- Arts. 1584, 1481 19, Right to the fruits- Arts. 1537, 1164 20. Acceptance- Arts. 1582-1583, 1585-1588, 1593 Vi. 21. 22, Vu. 23. 24. The Maceda Law (RA 6552)- Sale of Immovables on Installment R. 5 73 SCRA 79 Fabrigas v. San Francisco del Monte, Inc. 476 SCRA 247, November 25, 2005 Remedies for Breach of Contract Remedies of an Unpaid Seller- Arts. 1525-1526 Remedies of the Buyer- Arts, 1539, 1542-1543, 1567, 1571, 1599 Reeto Law — Sale of Movables on Installment- Arts. 1484-1486 industriai Fiance Corp. v. Kamurez, 77 SCRA 152, iMiay 26, 1977 Northern Motors, Inc. v. Sapinoso, 33 SCRA 1970, May 29, 1970 Extinguishment of Sale Causes- Arts. 1600, 1231, 1626, 1634-1635 Redemption a. Conventional - Art. 1601 Pacto de Retro Sale- Arts. 1607, 1609, 1611-1518, 1676-1677 Equitable Mortgage- Arts. 1602-1605 Period to Redeem- Art. 1606 Who may exercise the right to redeem? - Arts. 1608, 1610, 1612, 1614-15 Cadungog v, Yap, 469 SCRA 561, September 12, 2005 ¥. Cons Go v. Bacaron, 472 SCRA 339, October 11, 2005 e Legal- Arts. 1619-1623 ‘Spouses Doromal , Sr. and Salas v. Court of Appeals, supra Almendrada v. Ngo, 471 SCRA 311, September 30, 2005 Aguilar y, Aguilar, 478 SCRA 187, December 16, 2005