V.

PRICE_Provisions Reviewer

A. MEANING OF PRICE- Arts. 1469-1474

Article 1469. In order that the price may be considered certain, it shall be sufficient that it be so with
reference to another thing certain, or that the determination thereof be left to the judgment of a special
person or persons.

Should such person or persons be unable or unwilling to fix it, the contract shall be inefficacious, unless the
parties subsequently agree upon the price.

If the third person or persons acted in bad faith or by mistake, the courts may fix the price.

Where such third person or persons are prevented from fixing the price or terms by fault of the seller or the
buyer, the party not in fault may have such remedies against the party in fault as are allowed the seller or
the buyer, as the case may be. (1447a)

Article 1470. Gross inadequacy of price does not affect a contract of sale, except as it may indicate a defect
in the consent, or that the parties really intended a donation or some other act or contract. (n)

Article 1471. If the price is simulated, the sale is void, but the act may be shown to have been in reality a
donation, or some other act or contract. (n)

Article 1472. The price of securities, grain, liquids, and other things shall also be considered certain, when
the price fixed is that which the thing sold would have on a definite day, or in a particular exchange or
market, or when an amount is fixed above or below the price on such day, or in such exchange or market,
provided said amount be certain. (1448)

Article 1473. The fixing of the price can never be left to the discretion of one of the contracting parties.
However, if the price fixed by one of the parties is accepted by the other, the sale is perfected. (1449a)

Article 1474. Where the price cannot be determined in accordance with the preceding articles, or in any
other manner, the contract is inefficacious. However, if the thing or any part thereof has been delivered to
and appropriated by the buyer he must pay a reasonable price therefor. What is a reasonable price is a
question of fact dependent on the circumstances of each particular case. (n)

B. REQUISITES FOR A VALID PRICE

1. Must be real- Arts. 1471

a. When price simulated
b. Effects when price simulated
c. False consideration - Art. 1353 and 1354, 1355
01 Mapalo v. Mapalo 17 SCRA 114 (1966)
02 Ong v. Ong 139 SCRA 133 (1985)
03 Bagnas v. CA 176 SCRA 159 (1989)
04 Morales v. CA 27 SCRA 484 (1969)
d. Non-payment of price-
2. Must be in money or its equivalent- Arts. 1458, 1468
05 Republic v. Phil. Resources 102 Phil 960 (1958)
3. Must be certain or ascertainable at time of perfection - Arts. 1469
06 Toyota Shaw v. CA 244 SCRA 320 (1995)
 REQUISITES FOR A VALID PRICE

1. Must be real- Arts. 1471

a. When price simulated
b. Effects when price simulated
c. False consideration - Art. 1353 and 1354, 1355
d. Non-payment of price-
2. Must be in money or its equivalent- Arts. 1458, 1468
3. Must be certain or ascertainable at time of perfection - Arts. 1469

Article 1471. If the price is simulated, the sale is void, but the act may be shown to have been in reality a
donation, or some other act or contract. (n)

Article 1353. The statement of a false cause in contracts shall render them void, if it should not be proved
that they were founded upon another cause which is true and lawful.

Article 1354. Although the cause is not stated in the contract, it is presumed that it exists and is lawful,
unless the debtor proves the contrary.

Article 1355. Except in cases specified by law, lesion or inadequacy of cause shall not invalidate a contract,
unless there has been fraud, mistake or undue influence. (n)

Article 1458. By the contract of sale one of the contracting parties obligates himself to transfer the
ownership and to deliver a determinate thing, and the other to pay therefor a price certain in money or its
equivalent.

A contract of sale may be absolute or conditional.

Article 1468. If the consideration of the contract consists partly in money, and partly in another thing, the
transaction shall be characterized by the manifest intention of the parties. If such intention does not clearly
appear, it shall be considered a barter if the value of the thing given as a part of the consideration exceeds
the amount of the money or its equivalent; otherwise, it is a sale.

Article 1469. In order that the price may be considered certain, it shall be sufficient that it be so with
reference to another thing certain, or that the determination thereof be left to the judgment of a special
person or persons.

Should such person or persons be unable or unwilling to fix it, the contract shall be inefficacious, unless the
parties subsequently agree upon the price.

If the third person or persons acted in bad faith or by mistake, the courts may fix the price.

Where such third person or persons are prevented from fixing the price or terms by fault of the seller or the
buyer, the party not in fault may have such remedies against the party in fault as are allowed the seller or
the buyer, as the case may be. (1447a)
C. HOW PRICE IS DETERMINED

1. By third person - Art. 1469

2. By the courts-Art. 1469
3. By reference to a definite day- Art. 1472
4. By reference to another thing certain
5. Never by one party - Arts. 1473, 1182

Article 1469. In order that the price may be considered certain, it shall be sufficient that it be so with
reference to another thing certain, or that the determination thereof be left to the judgment of a special
person or persons.

Should such person or persons be unable or unwilling to fix it, the contract shall be inefficacious, unless the
parties subsequently agree upon the price.

If the third person or persons acted in bad faith or by mistake, the courts may fix the price.

Where such third person or persons are prevented from fixing the price or terms by fault of the seller or the
buyer, the party not in fault may have such remedies against the party in fault as are allowed the seller or
the buyer, as the case may be.

Article 1472. The price of securities, grain, liquids, and other things shall also be considered certain, when
the price fixed is that which the thing sold would have on a definite day, or in a particular exchange or
market, or when an amount is fixed above or below the price on such day, or in such exchange or market,
provided said amount be certain.

Article 1473. The fixing of the price can never be left to the discretion of one of the contracting parties.
However, if the price fixed by one of the parties is accepted by the other, the sale is perfected.

Article 1182. When the fulfillment of the condition depends upon the sole will of the debtor, the conditional
obligation shall be void. If it depends upon chance or upon the will of a third person, the obligation shall
take effect in conformity with the provisions of this Code

D. INADEQUACY OF PRICE -Arts. 1355, 1470

Article 1355. Except in cases specified by law, lesion or inadequacy of cause shall not invalidate a contract,
unless there has been fraud, mistake or undue influence. (n)

Article 1470. Gross inadequacy of price does not affect a contract of sale, except as it may indicate a defect
in the consent, or that the parties really intended a donation or some other act or contract. (n)

E. WHEN NO PRICE AGREED-Art. 1474

Article 1474. Where the price cannot be determined in accordance with the preceding articles, or in any
other manner, the contract is inefficacious. However, if the thing or any part thereof has been delivered to
and appropriated by the buyer he must pay a reasonable price therefor. What is a reasonable price is a
question of fact dependent on the circumstances of each particular case. (n)

F. MANNER OF PAYMENT MUST BE AGREED UPON

07 Velasco v. CA 51 SCRA 439 (1973)

G. EARNEST MONEY V. OPTION MONEY-Art. 1482

08 Limson v. CA 357 SCRA 209 (2001)

09 San Miguel Properties v. Huang 336 SCRA 737 (2000)

Article 1482. Whenever earnest money is given in a contract of sale, it shall be considered as part of the
price and as proof of the perfection of the contract