1458 CONTRACT OF SALES

Absolute CS – sale is not subject to any condition whatsoever and where title passes to the buyer upon
delivery of the thing sold real obligation, to give

Conditional CS – sale contemplates a contingency, in the case of the vendee, the full payment of the
agreed purchase price, in the case of the vendor, the fulfillment of certain warranties, personal
obligation, to do

Characteristics of a Contract of Sales

 Commutative
 Principal
 Nominal
 Bilateral
 Onerous
 Consensual

Contract of Sale – title to passes to buyer upon delivery

- non-payment: negative resolutory condition

Contract to Sell – privilege to purchase, title shall not pass until price is fully paid

- full payment: positive suspensive condition

^^^^^

1459 LICIT THING

General Rule: You cannot give what you do not have - NEMO DAT QUOD NON-HABET

The thing must be LICIT or lawful, that is, it should not be contrary to law, morals, good customs, public
order, or public policy (legal to law = per accidens (EX. Decayed food); legal to nature = per se (EX. Lotto
tickets, sale of land to alien) )s

 Ownership is no needed at the perfection of the contract what’s required is the ownership of
the seller at the point of delivery

1460 DETERMINATE THING

A thing is determinate when it is particularly designated or physically segregated from all others of the
same class.

Satisfied if at the time the contract is entered into, the thing is capable of being made determinate
without the necessity of a new or further agreement between the parties.

1461 SALE OF THING WITH POTENTIAL EXISTENCE

Emptio Rei Speratae Sale of Thing Expected

SALE: things not yet in existence

CASE: the contract will cease when the thing don’t exist

CONDITION: the thing should exist

Emptio Spei Sale of Hope

SALE: hope that the thing will come into existence

CASE: the buyer would still pay even if the thing doesn’t exist

EX: Sale of Sweepstake ticket

Presumption: in case of doubt Emptio rei speratae

1462 FUTURE GOODS

 Existing goods owned or possessed

 To be manufactured, raised or acquired by seller
 Goods subject to contingency is also allowed
 Future inheritance and donations aren’t allowed

A sale of future goods, even though the contract is in the form of a present sale, is valid only as an
executory contract to be fulfilled by the acquisition and delivery of the goods specified

1463 SALE OF AN UNDIVIDED SHARE TO A THING

The sole owner of a thing may sell an undivided interest (no specific portion)

This sale would result to a CO-OWNERSHIP

1464 SALE OF AN UNDIVIDED SHARE OF A SPECIFIC MASS

The owner of a mass of goods may sell only an undivided share when the mass is specific or capable of
being made determinate.

The buyer becomes co-owner

Aliquot share is based on the entire mass

In case of deficiency = the buyer would be the owner of the entire mass, the SELLER SHALL SUFFICE ANY
DEFICIENCY

The risk of loss is born by all the co-owners of the property

1463 and 1464 are both having an INCORPOREAL subject matter = undivided ineterst
1465

Things subject to a resolutory condition may be the object of the contract of sale.

1466 CONTRACT OF SALE VS. CONTRACT OF AGENCY

A contract is what the law defines it to be, and not what it is called by the contracting parties.

Contract of Agency

Principal – Agent – Buyer

Contract of Sale

Seller – Buyer

1503 DELIVERY TO THE CARRIER

General rule: THE OWNERSHIP IN THE GOODS SOLD PASSES TO THE BUYER UPON THEIR DELIVERY TO
THE CARRIER

Reasons: If a seller consigns goods to another specified person it indicates an intention to deliver
to the carrier as bailee for the person named, and, if such shipment was authorized by that person as a
buyer, the ownership vests in him.

Exceptions:

1. Contrary intention appears by the terms of the contract (when the stipulations says so)
 Reserve the right of possession or ownership in the goods until certain conditions have been
fulfilled (fully-paid buyer) (1501)
2. Goods are CONSIGNED to the carrier (ownership would be identified with the use of the bill of
lading)
 Order Bill: To the order of the seller or his agent = seller is the owner
However if the goods consigned to the carrier is delivered to the buyer therefor the reservation
of the seller is only for the SECURITY and thus ownership transfers to the buyer. (C.O.D. shipping
terms)
 Order Bill: To the order of the buyer or his agent, bill of lading is in the possession of the seller =
seller is the owner
ORDER BILL: Surrender of bill to the buyer is necessary
STRAIGHT BILL OF LADING goods by its terms deliverable not TO THE ORDER OF CONSIGNEE
(which needs a bill of lading) but to the CONSIGNEE ONLY.
 Consignment to a third person whether what kind of bill is used = seller owns the goods
3. Seller draws on the buyer for the price and transmits the bill of exchange and the bill of lading
together
In BILL OF LADING the ownership of the goods is transferred to the consignee, unless indorsed.

1504 LOSS OF GOODS SOLD AFTER THE PERFECTION OF THE CONTRACT (Exceptions of 1480)

“Unless otherwise agreed, the goods remain at the seller’s risk until the ownership therein is
transferred to the buyer”

General rule: if the thing is lost by fortuitous event, the risk is borne by the owner of the thing at the
time (res perit domino)

Exceptions: for SALE OF GOODS only

1. 1503(2)
2. Actual delivery has been DELAYED – risk lies to whomever is at fault

1505 SALE BY A PERSON WHO IS NOT THE OWNER

General Rule: Nemo dat quod non habet (YOU CANNOT GIVE WHAT YOU DON’T HAVE)

Exceptions: (1505) Considers a VALID sale if:

1. The provisions of any factors’ acts, recording laws, or any other provision of law enabling the
apparent owner of goods to dispose of them:
A. Owner of goods precluded from denying the authority to sell
B. Law enables the apparent owner to dispose of the goods as if he were the true
owner (Law on agency)
2. Sale is sanctioned by statutory or judicial authority (Bought by the buyer in a public Auction)
3. Sale is made at merchant’s stores, fairs or markets (case of an imperfect or void title ripening
into a valid one as a result of some intervening due causes)
4. Seller has a voidable title which has not been avoided at the time of the sale (1506)
5. Seller subsequently acquires title

1506 SELLER HAS A VOIDABLE TITLE

Rule: If the seller has only voidable title against the goods that he sold the buyer in good faith
acquires a good title.

Requisite for acquisition of GOOD TITLE:

1. Buys them before the title of the seller has been avoided
2. In good faith for value
3. Without notice to the seller’s defect of title

Applicability: The sale of a minor to an adult

 ^^^^^

1507 STATEMENT REGARDING A NEGOTIABLE DOCUMENT OF TITLE

NEGOTIABLE DOCUMENT OF TITLE – is a proof of possession of the thing that is endorsable to the
order of any person or to the bearer thereof

Document title to goods - proof of the possession or control of the goods, or authorizing or
purporting to authorize the possessor of the document to transfer or receive, either by indorsement
or by delivery, goods represented by such document. (1636)

3 Most Common Types:

a. Bill of Lading – a receipt for the transport of goods and their delivery to the person named
therein (carrier, shipper, consignee)
b. Dock Warrant – instrument given by dock owners to an importer of goods
c. Warehouse Receipt – receipt for goods deposited with a warehouseman (2137 Warehouse
Receipt Law)

1508 NEGOTIATION OF NEGOTIABLE DOCUMENT OF TITLE (NDT) THROUGH DELIVERY

If the NDT:

1. Deliverable to the bearer

2. Indorsed in blank

1509 NEGOTIATION OF NEGOTIABLE DOCUMENT BY INDORSEMENT

DOCUMENT IS SPECIALLY INDORSED becomes an order document of title and negotiation can only be
effected by the indorsement of the indorsee.

*Special Indorsement specifies the person to whom or to whose order the goods are to be delivered.

1510 NDT MARKED “NOT/NON-NEGOTIABLE”

The words “not negotiable,” “non-negotiable” and the like when placed upon a document of title in
which the goods are to be delivered to “order” or to “bearer” have no effect and the document
continues to be negotiable.

1511 NON NDT

Non-negotiable document of title cannot be negotiated. However, it can be transferred or assigned by

delivery thus the transferee acquires no additional rights.
1512 WHO MAY NEGOTIATE NDT

1. Owner
2. Any person in possession of the document or person to whom the it is entrusted

1513 RIGHTS OF A PERSON TO WHOM A NDT HAS BEEN DULY NEGOTIATED

1. Title of the person negotiating (Yung nag-endorse or pinagbilan)

2. Title of the owner or depositor (maker ng document, original na may hawak)
3. Direct obligation of the bailee: hold possession of the goods for the original owner or to the
person to whom the negotiable document of title has been duly negotiated

1514 RIGHTS OF PERSON WHOM NDT (NOT REALLY NEGOTIABLE) IS TRANSFERRED

1. Rights of transferor
2. Rights to notify bailee of the transfer
3. Rights to acquire the obligation of the bailee to hold the goods for him

1515 RIGHTS OF A PERSON HOLDING AN NDT THAT NEEDS AN INDORSEMENT TO BE PROPERLY

NEGOTIATED

1. Right of the transferor to the goods

2. Right to compel transferor to indorse the indorsement (1357)

1516 WARRANTIES ON SALES OF DOCUMENTS OF TITLE

1. Documents is genuine
2. Has a legal right to negotiate it or transfers it
3. Has knowledge of no fact which would impair the validity of the document
4. Has a right to transfer the title to the goods and that the goods are merchantable or fit for a
particular purpose

1517 INDORSER NOT A GUARANTOR

Indorsement of a document of title = conveyance by the indorser NOT A CONTRACT OF GUARANTY

An indorser of a document of title shall not be liable to the holder if, for example, the bailee fails to
deliver the goods because they were lost due to his fault or negligence.

1518 NEGOTIATION NOT IMPAIRED BY FRAUD, MISTAKE, DURESS

In other words, it may be negotiated even by a thief or finder and the holder thereof would acquire
a good title thereto if he paid value therefor in good faith without notice of the seller’s defect of
title. (Supported by article that talks about the acquisition of good title)

*this article talks about the THEFT OF DOCUMENTS not the goods.

1519 ATTACHMENT OR LEVY UPON THE GOODS UNDER A NEGOTIABLE DOCUMENT

While in the possession of such bailee, the goods cannot be attached or levied under an execution
unless the document be first surrendered, or its negotiation prohibited by the court.

*binding only to real owners not to thief

1520 CREDITOR’S REMEDIES TO REACH NDT

If the owner of NDT is a debtor, the creditor could attach the NDT to the debt by the help of the aid
from courts through appropriate jurisdiction by injunction.

What? However, if an injunction is issued but the negotiable document of title is negotiated to an
innocent person, the transfer is nevertheless effectual

^^^^^

1521 PLACE OF DELIVERY

General Rule: The buyer must take the goods from the seller and not vice versa

1. Place AGREED UPON

2. Determined by USAGE OF TRADE
3. Seller’s PLACE OF BUSINESS
4. Seller’s RESIDENCE
5. If SPECIFIC GOODS: if where it was located

TIME: fixed by contract, if not, reasonable time (dependent upon the circumstances attending the
particular transaction)

Delivery of Goods to Third Persons: to affect delivery of goods to third persons, the person holding
the goods must acknowledge being the bailee for the buyer.

The seller bears the expenses to place the thing in a deliverable state

1522 ACCEPTANCE OF GOODS DELIVERED

General Rule: Accept goods that are contracted only and reject the rest.

VARIATION SECENARIOS:

 LESS than contracted

 o The buyer is aware of non-fulfillment – pays at contract rate
o The buyer is not aware – pays only the fair value of the goods received
 LARGER than contracted (applicable to immovable property 1540)
May accept the goods and reject the rest. In acceptance = must pay at contract rate (the
appropriate rate for the goods accepted)
 MIXED GOODS at a different description (same rules as the above)
*when they are INDIVISIBLE, buyer may REJECT the whole
FAIR VALUE the benefit the buyer may receive from the goods, and not necessarily mean market
value.

1523 DELIVERY OF GOODS TO CARRIER = DELIVERY TO BUYER

Seller in terms of delivery to the buyer through the carrier:

 Seller shall make amends to the carrier regarding on how to handle the goods
 Seller shall give notice to buyer if the goods need to be insured

SHIPPING TERMS:

C.O.D Collect on Delivery – the carrier acts for the seller to collect the purchase price. Upon
shipment the title is already in the possession of the buyer. This is only an example scene of Art.
1503 that the seller is withholding the goods as a security.

F.O.B Free on Board (Shipping Point or Destination) – free of expense to the buyer, presumably the
title passes to the buyer upon shipment.

C.I.F. Cost, Insurance, and Freight – the price fixed or paid covers the cost, insurance and the freight
to be paid by the seller. The title passes to the buyer at the moment of delivery.

General Presumption: If the buyer pays for freight, the goods becomes his at the point of shipment.
If the seller is the one who pays, then the goods would not belong to the buyer not until it was
delivered to him.

1524

General Rule: the thing shall not be delivered unless the price be paid

Exceptions: thing must be delivered if TIME for such payment has been FIXED.

^^^^^

1525

UNPAID SELLER-

a) Whole price has not been paid

 b) The bill of exchange or other negotiable instrument received has been dishonor, the
insolvency of the buyer.
“the delivery of promissory notes payable to order, or bills of exchange or other mercantile
documents shall produce the effect of payment only when they have been cashed or when
through the fault of the creditor they have been impaired.” Art 1249 Civil Code

Seller includes AGENT of seller, CONSIGNOR, any person in the position of seller.

What is tender of payment?

1526

RIGHTS OF AN UNPAID SELLER

1. Possessory Lien (right to retain the goods) and lien on price

2. Buyer becomes insolvent, right of stopping the goods in transit
3. Right of resale
4. Right to rescind

1527

RIGHT OF AN UNPAID SELLER WHO’S IN POSSESION OF THE GOODS needs to retain the goods in him
until payment has been made

1. There’s no stipulation as to credit

2. There’s a stipulation as to credit, and the term has expired
3. The buyer becomes insolvent

1528

Generally lien is not lost by part delivery not unless the part delivered represents the wholesomeness of
the thing being sold. In that case the right to lien for the remaining part or balance is already lost.

1529

WHEN DOES UNPAID SELLER LOSES HIS RIGHT TO LIEN:

1. Upon delivery of goods to the carrier and the seller doesn’t reserve any ownership from it.
2. The buyer or agent has lawfully obtain the possession of goods
3. Waiver of such rights (if expressly stated in the agreement)

RIGHT TO LIEN IS REVIVED AFTER DELIVERY WHEN:

1. The buyer doesn’t accept the goods after it has been delivered by a carrier
2. The buyer returns the goods in a wrongful repudiation of the sale.
1530

REQUISITES FOR THE EXERCISE OF RIGHT OF STOPPAGE IN TRANSITU

1. Seller is unpaid
2. Buyer is insolvent
3. Goods is in transit
4. Seller takes actual possession or give notice of his claim to the carrier
5. Seller must surrender the negotiable instrument
6. Seller must bear the expenses of delivery of goods after the exercise of the right

*buyer’s insolvency need not be judicially declared.

1531

WHEN GOODS ARE CONSIDERED IN TRANSIT:

 After delivery to carrier before delivered to the buyer

 When goods are rejected by the buyer and the carrier continues to possess them

WHEN GOODS ARE NOT IN TRANSIT:

 After delivery to buyer or his agent

 Buyer obtains possession of goods before the destination
 Carrier or bailee acknowledges to hold goods in behalf of the buyer
 Carrier or bailee wrongfully refuses to deliver the goods to the buyer (this is possible and the
seller will not lose its right to lien ONLY when the refusal of delivery is due to buyers non-
payment of the freight)

Attornment = delivery

Delivery chartered by the buyer – ownership is depending on the circumstances

Delivery through the vehicle or transportation owned by the buyer – considered as delivery to
the buyer

1532

WAYS OF EXCERCISING THE RIGHT OF STOPPAGE IN TRANSITU

1. Taking actual possession (ordering the carrier to redeliver to the goods to the seller)
2. Giving notice of his claim to the carrier
3. If a negotiable instrument is involved – the acquisition of the carrier to the instrument would
only be the way
*the right of an innocent purchaser of the instrument is superior from the seller’s right
1533

REQUISITES OF UNPAID SELLER’S RIGHT OF RESALE

1. Right to lien
2. Right of stoppage of goods in transit, and ANY of the following
3. Goods is perishable in nature
4. Rights to resell is expressly reserved
5. Buyer delays in the payment of price for an unreasonable time

EFFECT OF RESALE

Profit made due to resale – seller is not liable

Deficit made due to resale – seller has a right to sue the buyer for the balance

Damnum absque injuria

NOTICE OF RESALE is not necessary if the goods is perishable but it is for other circumstances to be able
to identify the accurateness of unreasonable time.

*Seller shouldn’t buy the goods directly or indirectly

1534

REQUISITES OF AN UNPAID SELLER’S RIGHT TO RESCISSION

1. Right to lien
2. Right of Stoppage in transit, and ANY of the following:
3. Right to rescind is EXPRESSLY reserved
4. Buyer delays in payment of the price for an unreasonable time

In this case, SELLER RESUMES OWNERSHIP in the goods

Notice to the buyer or other overt act showing intention to rescind is necessary in determining
reasonableness of time

1535

Unpaid seller’s right is not affected by the buyer’s disposition made to the goods unless the seller
acknowledge it.

Goods covered by negotiable document of title – seller’s lien cannot prevail against the rights of a
purchaser for value in good faith to whom the document has been indorsed
1536 (same as Art 1198)

“The debtor [vendee] shall lose every right to make use of the period:

(1) When after the obligation has been contracted, he becomes insolvent, unless he gives a guaranty
or security for the debt [price];

(2) When he does not furnish to the creditor [vendor] the guaranties or securities which he has
promised;

(3) When by his own acts he has impaired said guaranties or securities after their establishment, and
when through a fortuitous event they disappear, unless he immediately gives new ones equally
satisfactory;

(4) When the debtor [vendee] violates any undertaking, in consideration of which the creditor
agreed to the period;

(5) When the debtor [vendee] attempts to abscond.”

1537

The vendor is bound to deliver the accessions (fruits) and accessories (attachment to principal) of
the thing sold upon the perfection of the contract unless there’s a provision to the contrary.

1538 (same as 1189 shall be memorized)

(1) If the thing is lost without the fault of the debtor, the obligation shall be extinguished; (1480)

1539 – 10% on sales of real property

General Rule: The entire area (quality specified) stipulated shall be delivered

If it can’t be delivered – the vendee is entitled to RESCIND when:

1. Lack in area is at least 10%

2. Deficiency in quality exceeds 10% of the price agreed upon
3. If the vendee would have not bought it, had he known of its smaller area or inferior quality
irrespective of the extent of the lack in area or quality

*In case of fulfillment, the vendee is entitled only to a proportionate reduction of the price where
there is a deficiency in area or number

1541

1539 and 1540 are both applicable to private (voluntary) sales and to judicial sales
 1542 REAL ESTATE AT LUMP SUM and BOUNDARIES

Lump sum sale of real estate doesn’t consider any deductions or increase of price in case there
is a discrepancies in the area. (Applicable to sale of two or more immovable properties sold for a
single price)

If the contract mentions about BOUNDARIES it shall be the basis of the area bound to be deliver
to the vendee, even when it exceeds the area but when it is lacking, there shall be a reduction in
price.

BOUNDARIES’ RULE:

1. If sufficiently certain – General Rule: the boundaries prevail over the area
2. Overlapping of boundaries exist (the boundaries mentioned do not identify a land) – area
over boundaries shall prevail.
3. Discrepancies in measurement is so great – area shall prevail

1543 Prescriptions for 1539 and 1542 (rescission) shall prescribe in 6 months counted from the day of
delivery

^^^^^

1544 DOUBLE SALE

Double sale:

 Movable Property – person who may have first taken possession thereof in good faith
 Immovable Property - person acquiring it who in good faith first recorded it in the Registry of
Property;
In the absence of registration, the vendee who first takes possession in good faith; and
In the absence of both registration and possession, the vendee who presents the oldest
title (who first bought the property) in good faith.
*More credit to registration over actual possession.
Possession of property is defined by Article 1497-1501
Governing Principle: prius tempore, patior jure (first in time, stronger in right)

^^^^^

1545 CONDITIONAL SALE

If condition is NOT PERFORMED – a. may refuse to proceed to the contract OR

b. waive the performance of the condition

In PROMISED CONDITION – Non-performance is a BREACH OF WARRANTY

1546 EXPRESS WARRANTIES

WARRANTY statement of representations made by the seller

EXPRESS WARRANTY any affirmation of fact or any promise by the seller relating to the things that
induce the buyer to purchase the thing at ung buyer naman naniwala ayon binili nga.

*warranty (being part of the contract of sale) is immaterial whether what has been said is true or false.
Once it has been said and relied upon by the buyer the seller should face the consequence of what he
says.

EXPRESS OF OPINION is different form warranty unless the seller is an expert.

1547 IMPLIED WARRANTIES

IMPLIED WARRANTY – law derives by implication or inference from the NATURE of the transaction
hence it is a NATURAL not an essential element of a contract (PRESUMED TO EXIST even though nothing
has been said.

*It can be waived or modified by EXPRESS STIPULATION

Contract of Sale inclusions: (unless a contrary to the intention appear)

1. Implied Warranty that seller has a RIGHT TO SELL THE THING (1548)
2. Implied Warranty that THING IS FREE FROM ANY HIDDEN FAULTS (DEFECTS) (1561)
3. Implied Warranty as to FITNESS OR MERCHANTABILITY (1562)

*this doesn’t render liable the sheriff, auctioneer, mortgagee or pledgee

Caveat emptor buyer beware

^^^^^

1548 EVICTION

EVICTION – judicial process where the VENDEE IS DEPRIVED of whole or part of THE THING PURCHASED
by virtue of a FINAL JUDGMENT based on a right prior to the sale or an act imputable to the vendor. (this
could happen in double sale, where there is another person claiming ownership from a property sold by
the seller; could also happen to stolen objects)

ELEMENTS OF WARRANTY AGAINST EVICTION

1. Vendee is deprived in whole or in part of the thing purchased (1557)

2. Deprived by virtue of a final judgment (1557)
3. Judgment is based on a right prior to sale or an act imputable to the vendor
4. Vendor is summoned in the suit for eviction at the vendee’s instance (1558)
5. No waiver on the part of the vendee
1549 The vendee need not appeal from the decision in order that the vendor may become liable for
eviction. THE VENDOR IS LIABLE IN ANY CASES!!

1550 VENDOR NOT LIABLE FOR EVICTION

RIGHTS TO THE THING HAS BEEN PRESCRIBED BEFORE SALE – vendor is liable for eviction

RIGHTS TO THE THING HAS BEEN PRESCRIBED AFTER SALE – vendor is not liable anymore, the fault is
due to the negligence of the people

Example scene: Josh sold a land to Ken. The land is being claimed by Jah and is possessed by him for 25
years. As according to prescription of ownership Jah still doesn’t owned the land, thus Josh could raise
and forfeit their contract of sale to Ken, but because he still continues to buy it knowing that someone
already owns it, Josh just make Ken liable for eviction forfeited.

1551 VENDOR LIABLE FOR EVICTION

Property sold for non-payment of taxes and it is not known to the buyer before sale, THE VENDOR IS
LIABLE FOR EVICTION.

1552 JUDGMENT DEBTOR

Judgment debtor* is also responsible for eviction in judicial sales.

*person whose property has be sold in a judicial sale.

1553

Stipulations exempting the vendor from its obligation to answer for eviction shall be VOID, if he acted in
BAD FAITH.

1554 WAIVER OF EVICTION

KINDS:

 Consciente – (voluntary made) without the knowledge and assumption of risks of eviction
o Vendor’s liab: pay the value of the thing sold (solution indebiti)
 Intencionada – waiver made with the vendee’s knowledge of risks
o Vendor’s liab: exempted from his obligation given he doesn’t act in bad faith

*presumption of waiver : consciente

1555 RIGHT AND LIABILITIES IN EVICTION

PAYMENT TO BE MADE:

 return the value of thing at the time of eviction (including the value of improvements spent
by the vendee)
 income or fruits received by the vendee to be given to the party who won the suit (be made
by the vendee)
 cost of suit (not including damages if the vendor doesn’t act in bad faith)
 expenses of the contract
 damages and interests (only on sales of bad faith)

1556 PARTIAL EVICTION

Rights of the Vendee in PARTIAL EVICTION = demand rescission of contract

APPLICABLE ONLY
 vendee is deprived of a part of the thing sold
 two or more things are jointly sold

1559
The defendant vendee shall ask that the vendor be made a co-defendant, within the time fixed in the
Rules of Court for answering the complaint.

Encumbrance = mortgage, BURDEN

1560 IMMOVABLE PROPERTY WITH NON-APPARENT ENCUMBRANCE

RIGHT (ACTION) OF THE VENDEE

1. rescission of contract* OR
2. Indemnity
*Applicable only WITHIN ONE YEAR FROM THE EXECUTION OF DEED OF SALE, when period has elapsed
indemnity is the only thing possible to ask for the vendor WITHIN ONE YEAR from the DATE OF
DISCOVERY of the burden.

*Rights were not EXERCISABLE if:

 Apparent servitude
 Non-apparent burden is REGISTERED
 Vendee is KNOWLEDGEABLE of the encumbrance (whether registered or not)
Vendor could also not be liable if
SERVITUDE (OR EASEMENT) is an encumbrance imposed upon an immovable for the benefit of another
immovable belonging to a different owner.
Example: Apparent – right of way
Non Apparent – party wall with no exterior sign

^^^^^ VENDOR’S LIABILITY FOR THE DEFECTS IN THE THING SOLD

1561 REDHIBITION
REDHIBITION – avoidance of a sale on account of vice or defect in the thing sold (warranty against
hidden defects)
REDHIBITORY ACTION – actions to avoid a sale on account of some defect or vice
REDHIBITORY VICE OR DEFECT- defect in the thing sold which the seller shall have warranted

REQUISITES FOR WARRANTY AGAINST HIDDEN DEFECTS

1. Must be IMPORATANT or SERIOUS
2. Must be HIDDEN (no warranty in case the defect is the patent or defect which is visible to the
eye)
3. Must EXIST AT THE TIME OF SALE
4. VENDEE MUST GIVE NOTICE OF THE DEFECT TO THE VENDOR within a reasonable time
5. Rescission or reduction of the price MUST BE BROUGHT WITHIN PROPER PERIOD:
a. 6 months from delivery (THING) (1571 actions from 1561-1570 were only for 6 MONTHS
only if it is for breach of implied warranty, if quasi-delict 4 years)
b. 40 days from delivery (ANIMAL) (1577 and is applicable only to defects determined by
law or customs)
6. NO WAIVER OF WARRANTY THE VENDEE HAS MADE

1562 IMPLIED WARRANTIES

Implied Warranties of Quality
a. Reasonably fit for the buyer’s purpose – specific purpose
b. Of merchantable quality – general purpose

1563
In a contract of sale of SPECIFIED ARTICLE under its patent or trade name, there is NO WARRANTY AS TO
ITS FITNESS FOR ANY PARTICULAR PURPOSE, unless there is a stipulation to the contrary.

1564
IMPLIED WARRANTY or condition as to the quality or fitness for a particular purpose MAY BE ANNEXED
BY THE USAGE OF TRADE.

1565 SALE BY SAMPLE

Sale by sample to a buyer is not entitled to implied warranties of merchantability if the sample given is
not merchantable. But if the sample is subject to a LATENT DEFECT (a defect that would not be seen
through inspection) the buyer is entitled to the goods that the sample seems to represent.

1566
Ignorance of the vendor to defect would not relieve him liable to the buyer (principle of CAVEAT
VENDITOR “let the seller beware”), unless there is a stipulation to the contrary, together with the
ignorance.

*Caveat Emptor “let the buyer beware” (applicable to sheriff’s sale) opposite of Caveat Venditor

1567
1561-1566 VENDEE’S REMEDIES:
1. Accion Redhibitoria (action for rescission of contract)
2. Accion Quanti Minoris (reduction of price)
BOTH WITH DAMAGE

1568 LOST THING WITH HIDDEN DEFECTS

a. VENDOR IS AWARE of hidden defects
1. Price paid
2. Expense of contract
3. Damages
b. VENDOR IS NOT AWARE of hidden defects
1. Price paid
2. Interest
3. Expense of contract IF the vendee has paid for them

1569
Things sold has hidden defect but LOST through fortuitous event or VENDEE’s fault, vendor shall pay the
vendee = AMOUNT PAID – THE VALUE OF THING WHEN IT’S LOST.
If the vendor ACTED IN BAD FAITH, he shall pay for damages too.

1570
1568 and 1569 remedies are applicable to judicial sales but the judgment debtor is not liable for
damages.

^^^^^ VENDOR’S LIABILITY FOR THE DEFECTS IN THE ANIMAL SOLD

1572 REDHIBITORY DEFECT TO ANIMAL
If the animals both has a redhibitory defect on one of them, the redhibition is for that animal only.
However, if the sale is a yoke, pair or set, even if one of them is only in redhibition, ALL OF THE ANIMALS
would be consider in redhibitory because the buyer would not have bought them knowing that one of
them is defective.
Exact article
If two or more animals are sold together, whether for a lump sum or for a separate price for
each of them, the redhibitory defect of one shall only give rise to its redhibition, and not that of the
others; unless it should appear that the vendee would not have purchased the sound animal or animals
without the defective one.
The latter case shall be presumed when a team, yoke, pair, or set is bought, even if a separate
price has been fixed for each one of the animals composing the same.

1573
The provisions of the preceding article with respect to the sale of animals shall in like manner be
applicable to the sale of other things.
*apply also to sale of two or more things where only one or more of them but not all have hidden
defects.

1574
Animals or livestocks condemned, bought in a fair or public auction extra-judicially or judicially has no
implied warranty as to hidden defects.

1575
Sale of animal with CONTAGIOUS DISEASE is VOID.
Sale of animal which is UNFIT for service or use indicated in the contract is VOID.
Remedies is govern by contract nullity.

1576 VENDOR’S RESPONSIBILITY

To be considered redhibitory, the defect must not only be hidden. It must be of such a nature
that EXPERT KNOWLEDGE IS NOT SUFFICIENT TO DISCOVER IT.
However, if the VETERINARIAN failed to discover it through his IGNORANCE, or failed to disclose
it to the vendee through BAD FAITH, he shall be liable for damages. The responsibility is his and not the
vendor’s.

1578
If the animal bought dies after 3 days of purchase the vendor is LIABLE ONLY IF THE ANIMAL’S DISEASE IS
EXISTING AT THE TIME OF CONTRACT. (date of sale not of delivery)

1579
RESCINDED SALE, the animal shall be returned in the condition in which it was sold and
delivered, the VENDEE BEING ANSWERABLE FOR ANY INJURY DUE TO HIS NEGLIGENCE, and not arising
from redhibitory fault or defect.

1580
Actions for redhibitory defects in animals is the governed by 1567 but shall be exercised them within the
period mentioned in redhibitory actions which is 40 days.

1581
Form of sale of large cattle shall be governed by special laws.

1582