- When execution of public instrument is NOT tantamount to an
actual delivery:
Chapter 6 – CONSUMMATION OF SALE
OBLIGATIONS OF THE SELLER
1. To preserve the subject matter
Art. 1163. Every person obliged to give a determinate thing is a also
obliged to take care of it with the proper diligence of a good father
of a family, unless the law or the stipulation of the parties requires
another standard of care.
2. To deliver the subject matter
Art. 1495. The seller is bound to transfer the ownership and to deliver
the thing which is the object of the sale, to the buyer.
3. To deliver the Fruits and Accessories
4. To Warrant the Subject Matter
Principles on Tradition: (Santos v Santos)
• acceptance by the buyer is not essential for delivery by the seller to
achieve its legal effects
• Express intention on the matter at the point of delivery is not
essential for tradition to produce its legal consequences
• only way to prevent the legal consequences of tradition from coming
into effect at the point of delivery is by an express reservation to
the contrary
TYPES OF DELIVERY
1. Actual Delivery
- When the thing sold is placed in the control and possession of
the buyer.
- Key word is CONTROL, not possession in determining the legal
effect of tradition. (Power Commercial and Industrial Corp. v
CA)
2. Constructive Delivery
- There is an existing agreement between seller and buyer that
the latter is understood to have control of the subject matter
of the sale.
a. Execution of Public Instrument
- When the sale us made thru a public instrument, the execution
shall be equivalent to the delivery of the subject matter of sale,
if from the deed the contrary does not appear or cannot clearly
be inferred.
- Execution of a public instrument is tantamount to an actual
delivery provided that at the time of execution, the seller has
control over the property. It is not enough that the seller has
ownership and right of possession. He must have CONTROL.
(Addison v Felix)
- The control must subsist for a reasonable length of time,
otherwise it can be rebutted by a clear and convincing evidence
such as an interposition of a third party. (Danguilan v IAC)
- In execution of a public instrument to be effected as a delivery,
there must be no legal impediments that exist and no
interposition of a third party.
- When it comes to a 3rd party and the issue centers on the title
or ownership of the subject matter, execution of a public
instrument would produce the effect of tradition/sale, but only
insofar as the title is concerned provided at the time of
execution there was no legal impediment on the part of the
seller to transfer title to the buyer, even if at the time of sale,
control and possession were not in his hands.
• when there is a stipulation to the contrary
• when the subject matter was not subject to the control of the
seller
• when control of the seller did not subsist for a reasonable
length of time
b. Symbolic Delivery
- Must involve or cover the subject matter, and cannot take a
form relating to the payment of purchase prices.
c. Constitutum Possessorium
- Takes effect when at the time of perfection of the sale, the
seller held possession of the subject matter in the concept of
owner, and pursuant to the contract, seller continues to hold
physical possession no longer in the concept of owner, but as a
lessee or any other form of possession.
d. Traditio Brevi Manu
- Mode of delivery where before the sale, the would-be buyer
was already in possession of the would-be subject matter, say
a lessee, and pursuant to sale, he would now hold possession
in the concept of an owner.
e. Traditio Longa Manu
- Constructive delivery of a thing effected by mere agreement,
such as when the seller points the property subject matter and
the buyer agrees that from the time on he is the owner, without
need of actually delivering physical possession.
f. Delivery of Incorporeal Property
- Incorporeal property is having no physical existence. It can only
be effect thru constructive delivery.
g. Delivery by Negotiable Document of Title
h. Delivery through Carrier
 Free along Side Ship (F.A.S. Sales) – delivery of the goods
alongside the vessel completes the effect of tradition
 Free in board (F.O.B Sales) – seller shall bear all expenses until
the goods are delivered, depending on whether the goods are
to be delivered FOB at the point of shipment or at the point if
destination.
 Cost, Insurance, and Freight (C.I.F. Sales) – amount quoted by
the seller and agreed by the buyer covers not only the cost of
the merchandise but also the cost of insurance and freight.
EFFECTS AND COMPLETENESS OF DELIVERY
1. Delivery must be made pursuant to a valid sale
- When a sale is void, no title can be conveyed. No mam can do
anything except what he can do lawfully.
2. Delivery must be effected when seller has ownership over the
subject matter of sale so delivered
- Seller must own the property. No man can dispose of that
which does not belong to him.
 To whom delivery must be made: to the buyer or his duly
authorized rep only, unless the buyer specifically designated
someone to receive delivery.
 When Buyer refuses to accept: buyer cannot refuse without
just cause. Acceptance of the buyer is NOT a condition for the
completeness of delivery.
  Art. 1588. When the buyer’s refusal to accept the goods is D. Time – reasonable time
without just cause, the title passes to him from the moment E. Demand and delivery — be made at a reasonable hour
they are placed at his disposal.
F. Expenses in putting the goods in a deliverable state – borne by
the seller
RULES ON EFFECT OF DELIVERY FOR MOVABLES
A. Where the seller delivers to the buyer a quantity of goods LESS RULES ON EFFECTS OF DELIVERY FOR IMMOVABLES
than what he contracted to sell
1. Unit price Contract – price is determined by way of reference
- Buyer MAY REJECT them to a stated rate per unit area ( 1k per sqm)
- But if buyer ACCEPTS, knowing that it is less, he must pay for 2. Lump Sum Contract – full purchase price for an immovable the
the full price area of which may be declared based on the estimate or where
- If the buyer has used or disposed of the goods before he knows both the area and boundaries are stated ( 1 million for 1,000
that seller is not going to perform his contract in full, buyer shall sqm)
not be liable for more than fair value to him of the goods
received.
 Expenses of Delivery and Registration on Real Estate: in (Vive
B. Where the seller delivers to the buyer a quantity of goods Eagle Land Inc. v CA), the expenses of delivery and registration
LARGER than what he contracted to sell on Real Estate must be borne by the seller unless there is a
- Buyer MAY ACCEPT the goods he bought, and REJECT THE REST stipulation to the contrary.
- If the buyer ACCEPTS the whole, he must pay for the full price - In (Chua v CA), the registration of the title of the buyer over the
- If the subject matter is indivisible, buyer may reject the whole purchased real estate is not an ingredient necessary for
tradition to have full effect.
C. Where the seller delivers to the buyer the goods contracted
but mixed with goods of a different description - The obligation of the seller is to transfer to the buyer the
ownership of the thing sold. In the sale of real property, seller
- Buyer may ACCEPT the contracted goods and REJECT THE REST is NOT obliged to transfer in the name of the buyer a new
- If the subject matter is indivisible, buyer may reject the whole certificate if title, but rather to transfer ownership of the real
property. There is a difference between the transfer if the
certificate if title in the name of the buyer, and the transfer of
 When goods held by a 3rd party: seller has not yet fulfilled his the ownership to the buyer.
obligation to deliver unless and until such 3rd person
acknowledges to the buyer that he holds the goods on the
buyer’s behalf.
 Reservation of Ownership: ownership will not transfer to the
buyer in case of express reservation, such as when the parties
stipulate that ownership will not transfer until the purchase
price is fully paid.
 Sale by description and/or sample: the sale may be rescinded if
the bulk if the goods delivered do not correspond with the
description or the sample
 On Sale or Return: to give the buyer an option to return the
goods instead of paying the price, the ownership passes to the
buyer on delivery, but he may revest the ownership in the seller
by returning or tendering the goods within the time fixed in the
contract, or if not time has been fixed, within a reasonable
time.
 Sale on Approval, Trial, Satisfaction, or Acceptance: ownership
then passes to the buyer when he signifies his approval or
acceptance to the seller or does not signify his approval or
acceptance, but retains the goods without giving notice of
rejection, then if a time has been fixed for the return of the
goods, on the expiration of a reasonable time.
 Form of Such Special Sales: there must be a clear agreement to
either sale of return or sale on approval

Written Proof of Delivery – written acknowledgement of a person

that he has actually received the thing. A bill of lading and a
factory consignment invoice are not proofs of delivery
Time, Place, and Expenses of Delivery —
A. First, depends on what is agreed upon in the contract
B. If no agreement, place of delivery is seller’s place of business, if
not, his residence
C. In case of specific goods, when the contract was made in some
other place, then that place is the place of delivery
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