Reviewer In Regulatory (week 2)

Object (Art 1459-1465)

Requisites:
1. THINGS:
a) determinate or determinable (Arts. 1458, 1460)
b) lawful (Arts 1347, 1409)
c) should not be impossible (Art. 1348)
2. RIGHTS – must be transmissible
Exceptions:
-future inheritance
- service or to be use in service
Emptio Rei Speratae
 Sale of an expected thing
 Sale is subject to the condition that the thing will exist; if it does not, there is no
contract
 The uncertainty is with regard to the quantity and quality of things and not the
existence of a thing
 Object is a future thing
Example:
 Wine
 Milk
 Butter
Emptio Spei
 Sale of a mere hope or expectancy that the thing will come to existence; Sale of
the hope itself
 Sale produces effect even if the thing does not come into existence unless it is a
vain hope
 The uncertainty is with regard to the existence of the thing
 Object is a present thing which is the hope or expectancy
Example:
 Sweepstake ticket
 Raffle Ticket
 Lotto Ticket
 Goods which may be Object of Sale
 a. Existing goods – goods owned or possessed by the seller.
 b. Future goods – goods to be manufactured, raised or acquired by the seller
after the perfection of the contract.

Sale of undivided interest

Nature of Undivided Interest

Two or more person have equal rights or interest over the same property
Effect of Sale Undivided Interest
The buyer will be the co-owner of the thing sold to him.

Can the Co-Owner sell his undivided share?

Yes, the co-owner of the thing can sell the share he owner over the said
property.

RULES ON RISK OF LOSS AND DETERIORATION:

a. The thing sold is lost before perfection: Seller bears the loss.
b. The thing sold is lost at the time of perfection: Contract is void or inexistent.
c. The thing sold is lost after perfection, but before delivery: buyer bears the lost

EFFECT OF LOSS AT THE TIME OF SALE:

a. Thing entirely lost at the time of perfection: Contract is void and inexistent
b. Thing only partially lost: Vendee may elect between withdrawing from
the contract or demanding the remaining part, paying its proportionate price

Consideration
Nature
The sum stipulated as the equivalent of the thing sold and also every
incident taken into consideration for the fixing of the price, put to the debit of the
vendee and agreed to by him.

General Rule
Seller is not bound to deliver the thing unless purchase price has been
paid to him.

Exception
Seller is bound to deliver the thing if the period of payment has been fixed.
 Requisites:
1. Certainty or ascertainable at the time of perfection
2. Real, not fictitious
3. In some cases, must not be grossly inferior to the value of the thing
sold.
4. Paid in money or its Equivalent

Certainty of the price (Art 1469)

 No sale if price is not certain or ascertainable
Certainty of price is a must or capable being ascertained in money
or its equivalent such as notes or checks.
 Cases where price is certain

o the parties have fixed or agreed upon a definite amount

o there’s reference that can be use to measure the certain price
o the determination of the price is left to the judgement of person
specified

Gross Inadequacy (Art 1470)

Nature
Insufficiency of the consideration offered in exchange for a certain
thing.
General Rule (Art 1355)
Except in cases specified by law, lesion or inadequacy of cause
shall not invalidate the contract unless there has been fraud, mistake or
undue influence

Effect of Gross Inadequacy of price in voluntary sales

Does not affect the contract of sale except as it may indicate a
defect in a consent or parties really intended donation or other form of act or
contract.

Effect of gross inadequacy of price in voluntary or execution sales

General Rule
Judicial or Execution sale is made by the court with respect
to the property of a debtor and his unpaid indebtedness.

When price is too low as to be “shocking to the conscience”

A judicial sale, say to the real property will be set aside by the court

Seller is given the right to repurchase

Validity of sale is not necessary, the owner can redeem his property
such as in public auction wherein the price is lesser for the owner to redeem his
property.
 Price of the thing is Stimulated (1471)
General Rule
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)

Exceptions
If price is not show to be donation or any other act or contract
transferring of ownership, the contract is void or inexistent

Manner of Payment

Nature

Before a valid binding contract of sale can exist, the manner of

payment of the purchase price must first be established, as such stands as essential to
the validity of the sale.

Contract of Piece of Work (Art 1713)

Nature
 By the contract for a piece of work the contractor binds himself to execute a
piece of work for the employer, in consideration of a certain price or compensation. The contractor
may either employ only his labor or skill, or also furnish the material."

Requisites:
o Transmissible
o Should qualify the qualities agreed upon or free from defects
otherwise the contractor may require the contractor to remove the
defect or execute another work at the contractor’s cost.

Limitation of contractor’s liability or cost

Limitation of contractor’s liability is a clause of a contract

whereby it serves as protection to the latter when there is a dispute in the work and
limits what they can be hold accountable for

Exceptions:
 Act of Fraud shall make the agreement of contractor’s
liability void.
 The contractor bound himself to the furnish of the defect

Barter (1468)
 Nature
A barter agreement is a legal contract whereby outlines the trade of
parties. This could be goods, services products or similar which is use in place of
monetary payments.

Seller’s ability to transfer ownership when required

Constructive delivery requires three things before ownership

may be transferred:
1. The seller must have control over the thing
2. The buyer must be put under control
3. There must be the intention to deliver the thing for purposes of
ownership

Types of Delivery
 Actual Delivery: If the goods are physically given into the possession of the
buyer, the delivery is an actual delivery.
 Constructive delivery: The transfer of goods can be done even when the
transfer is affected without a change in the possession or custody of the goods.
o Execution of public instrument (1498)
 Sale through public instrument is equivalent to the delivery of the
thing/object of the contract.
o Symbolic Delivery (1498)
 In case of movable goods such as storage consist of goods which
can’t be move due to bulk of goods it consist therefore its delivery
can be done by the delivery of the keys where the goods are kept.
o Constitutum Possessorium (1500)
 Continues possession of the thing of the former owner even though
the legal title is already transfer to another.
o Traditio Brevi Manu (1499)
 The buyer of the contracting parties already has the possession of
the thing before the thing is sell to him. (Delivery of short hand)
o Tradition Longa Manu (1499)
 The seller will deliver the movable property to the hands of the
buyer. (Delivery of long hand)
 Contract to sell
o Ownership cannot be transfer without full payment of the thing
o Full payment is a suspensive condition that is a must to meet to bind the
obligation and convey ownership over a thing.
o Title remains to the vendor incase of failure of payment
 Place of delivery of goods
 1. Where there is an agreement, place of delivery is that agreed upon
 2. Where there is no agreement, place of delivery determined by usage of
trade
 3. Where there is no agreement and no prevalent usage, place of delivery is
 the seller’s place
 4. In any other case, place of delivery is the seller’s residence
 5. In case of specific goods, which to the knowledge of the parties at the
time the contract was made were in some other place, that place is the
place of delivery, in the absence of agreement or usage of trade to the
contrary

Time of delivery of goods

 1. Stipulated time
 2. In the absence thereof, within a
reasonable time

Partially Delivered
The mere fact that part of the goods has been delivered does not deprive
the seller of the right to stop with respect to the remainder (Art. 1531 par. 4.) just as the
seller may still exercise his right of lien on the remainder after part of the goods had
been delivered. (Art. 1528.) However, it may be shown that the seller has an agreement
with the buyer to give up possession of the whole of the goods.

Forms of Contract to sell (1483)

Can be express from the word of mouth or writings or partly writing or
partly word of mouth
Exceptions: (express in writing or public instrument is a must)
 Sale of real property
 Sale of goods, chattels or things in action, at a price not less than
five hundred pesos, unless the buyer accept and receive part of
such goods and chattels, or the evidences, or some of them, of
such things in action or pay at the time some part of the purchase
money (Art 1403)

Sale of a piece of land through Agent

The authority of an agent to sell a piece of land must be in writing
otherwise the sale is void regardless of its form.

If the authority of the agent is in private instrument and the sale was;

 Entered orally- the sale is unenforceable

 In private instrument- valid
 In public instrument- valid

If the authority of the agent is in public instrument and the sale was;
 Entered orally- the sale is unenforceable
 In private instrument- valid
 In public instrument- valid