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A obliged himself to deliver a thing to B. Is there a contract of sale? Not necessarily.

There is a sale if A delivers, B pays a price certain in money or its equivalent, with the intention of transferring ownership of the subject matter. Otherwise: It would be a contract of lease if the intention is not to transfer ownership. There is barter if B likewise would deliver a thing, aside from A. And if the intention is to deliver a thing to transfer ownership out of gratuity, then there is donation. Therefore, the answer would depend upon the intention of the parties.

an announcement that the auction is without reserve. A bidder may, before the fall of the hammer, retract his bid. In the sale of large cattle however, the cattle registration decree provides that the sale must be in a public instrument, registered and a certificate should be obtained in order for the sale to be valid.

Is there a need for delivery in order that a contract of sale be considered perfected? As a consensual contract, there is no need. The only question here is the time when the contract was perfected.

2. Principal It can stand on its own and not dependent on other contracts for its existence and validity. 3. Bilateral

What are the characteristics?

1. Consensual This means that the contract is perfected by the mere meeting of the minds of the parties as to the object and the price. (1475) In the case of a sale by auction, the contract is perfected when the auctioneer announces its perfection by the fall of the hammer or in any other customary manner. The owner or auctioneer, before the fall of the hammer, withdraw the foods from the sale, unless there was

Reciprocal obligations arise, and it is not possible that only one party is obliged because a contract of sale is essentially onerous. 4. Onerous This means that valuable consideration is given. Otherwise, it may be another contract or any other act, such as donation. 5. Commutative There is equivalence in the value of the prestation to be performed by both parties.

This is with the exception if the parties intended to lower the price, for instance; also with the exception of an aleatory contract of sale, like the sale of hope: the sale of a lotto ticket by which PCSO will be obliged pay a person only if he/she got all the 4-6 numbers, which are drawn; and insurance contracts are aleatory. 6. Nominate A name is provided for in the Civil Code to distinguish it from others.

Sale of a parcel of land for P350 was not done in writing. What is the status of the contract? The contract is unenforceable. The sale involved is sale of immovable, hence, the price is irrelevant.

Sale of a bag for P250. What is the status of the contract? It depends. If the terms of the contract is not to be performed within 1 year and writing was made after delivery, then the contract is unenforceable. Otherwise, it is valid.

What are the classifications?

1. General classification a. Absolute sale Ownership passes upon delivery because no condition is attached. b. Conditional sale ownership passes upon fulfillment of the condition (Example: Sale of future harvest of a designated parcel of land) 2. Other classification a. As to subject matter 1. Sale of real or immovable property 2. Sale of personal or movable property Some concepts will apply if the object is movable or immovable: 1. Recto Law only if movable 2. Maceda Law only if realty 3. Statute of Frauds

Paredes v. Espino Paredes filed a case to compel Espino (spouses) to sell the land. Espino contented that the contract is unenforceable because it is not in writing. The contract is no longer covered by the Statute of Frauds because there was a letter signed by the spouses. 1403 provides that a note or memorandum signed by the party charged would be sufficient to take that contract out of the Statute of Frauds. Thus, Espino may be compelled to execute the final deed of sale.

4. Rules on Double Sale b. As to nature 1. Sale of a thing intangibles and incorporeal cannot be delivered physically 2. Sale of right sale of right or a credit; sale of copyright, trademark, or goodwill Note: Tangible chose in possession; Intangible chose in action

Is assignment of right a sale? Not necessarily. If the assignment is with a valuable consideration, it is a sale. If gratuitous or by dation in payment, it is not a sale as it is not for a consideration

and is not to pass until full payment of the price b. In the first, non-payment is a negative resolutory condition, whereas in the second, full payment is a positive suspensive condition c. In the first, the vendor has lost and cannot recover ownership until and unless the contract is resolved or rescinded, whereas in the second, title remains in the vendor, and when he seeks to eject the vendee because of noncompliance by such vendee with the suspensive condition stipulated, he is enforcing the contract and not resolving the same.

c. As to the validity or defect of the transaction

A agrees to sell a sewing machine to B for P400 in cash, and places the machine aboard the truck of B, while the latter goes home to fetch money. Before B returns, C appears and claims ownership of the sewing machine, exhibiting a document signed by B selling the machine to C. A rejects Cs claim alleging that he is still the owner. Decide with reasons. A is still the owner. As intention, in spite of a perfected contract of sale between A and B and the actual delivery by the placing of the sewing machine aboard Bs truck was to reserve the ownership to himself and to vest such ownership in the vendee only upon the actual payment of the purchase price.

How do you distinguish Sale from other contracts?

1. From contract to sell a. In the first, title passes to the vendee upon delivery of the thing sold, whereas in the second, by agreement, ownership is reserved in the vendor

2. From barter

In sale, the consideration is money; while in barter, the consideration is another thing, or the exchange of two things

A obliged himself to deliver to B a mountain bike work P500,000. B obliged himself to deliver to A a car plus P250,000. What contract is involved? It depends. Whether it is a sale or barter depends on the manifest intention of the parties. The basis is Art. 1468 where the situation is the consideration consists partly in money and partly in another thing. If the intention is not clear from their agreement, then the answer depends upon the value of the car. The law provides that it is 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. It is a sale if the cars value is equal to or less than P250,000. It is a barter if the cars value is greater than P250,000.

a. In sale, ownership passes to the buyer, in the latter, ownership is retained by the principal b. In sale, the buyer pays the seller; while in the latter, the buyer pays the agent, who transmits the money to the principal c. In sale, the goods are delivered by the seller to the buyer, while in the latter, it is the agent who delivers the goods to the buyer

A granted B the exclusive right to sell his brand of Maong pants to Isabela, the price for his merchandise payable within 60 days from delivery, and promising B a commission of 20% on all sales. After the delivery of the merchandise to B but before he could sell any of them, Bs store in Isabela was completely burned without his fault, together with all of As pants. Must B pay A for his lost pants? Why? Yes. It must first be determined whether the contract between A and B is an agency to sell or a contract of sale to know whether or not ownership passed to B. The case involves a sale because if B were an agent, he would not be bound to pay the price within 60 days even if he is unable to sell it as in this case. Given that ownership passed to B by the contract of sale, the goods are at Bs risk under Art. 1504. Hence, B must still pay the price.

3. From lease In sale, the seller transfers ownership to the buyer; while in lease, what is merely transferred is only the use and possession of the thing leased to the lessee 4. From agency to sell

5.

From dacion en pago a. In sale, there is no pre-existing credit, while in dation, there is

b. In sale, obligations are created because sale is a contract, while in dation, the obligation is extinguished because it is a special form of payment c. In sale, the consideration or the cause of the contract is the price, while in dation, the cause is the extinguishment of the debtors obligation For dation in payment to be governed by the law on sales, it is required that the preexisting obligation be in money; otherwise, it would be governed by the law on novation. 6. From contract for a piece of work In sale, the object is offered to the general market in the ordinary course of business, while in the latter, the object is made specially for a person, by which the contract may only supply labor, or labor and materials

What is the effect of a contract of sale when there is no consent given by one or both of the contracting parties? The contract is void because of the essential elements is lacking. It is considered as a fictitious contract, which would normally be that the signature of the parties in the sale was forged. The alleged seller will not have participation in the execution of the contract.

What is a simulated contract and what are the kinds of simulated contract? The parties here have participated, having voluntarily signed the deed of sale, but they either do not want to be bound by the contract (absolutely simulated) or they intend to be bound but they actually intend to enter into another contract (relatively simulated).

Why would the parties enter into this kind of sale? What is the Massachusetts rule? It is a rule to determine whether a contract is a contract of sale or a contract for a piece of work. ABSOLUTE To defraud creditors (sell remaining assets to make it appear that he has no more assets which may be reached by the creditors); applicants for residency abroad would normally be required to present certificate of title over parcels of land so that the applicant will appear to have assets and do not intent to be a TNT. RELATIVE To minimize tax liabilities (Donors tax is higher than 6% FIT and Documentary Stamp Tax); to circumvent the provisions on legitimes and collation under succession

What are the essential elements of a contract of sale?

1. Consent of the contracting parties

If consent is given, does it mean that the contract is valid? Not necessarily, because when consent is given by an incapacitated person, such is void or voidable as the case may be. a. Aliens are prohibited from acquiring by purchase private lands. The sale to aliens is void, except sale to a former natural born Filipino citizen. If, however, the land from the sale is acquired by a Filipino, then the defect is cured and the seller can no longer acquire ownership over it. b. Sale to a minor The sale is voidable, except when the minor is buying necessaries (food, clothing) or when he misrepresents his age (estoppels). c. Sale by persons mentioned in 1491: Guardians, Agents, Executors and Administrators, Public Officers and Employees, Justices et al., any other specifically disqualified by law The sale is void. The basis is 1409, where it is stated that prohibited contracts are void. d. Sale between spouses The contract is void, except when the spouses obtained a decree of separation of property in their marriage settlement. And even if they did not, if during their marriage they obtained a judicial declaration of complete separation of property.

Is the sale of rights perfected by mere consent? Yes, it is perfected, and thus valid. However, to bind third persons, such sale must be recorded in the registry of property.

2. Object or Subject Matter

Can service be the subject matter of sale? No, because service is not susceptible of ownership. How should it be with respect to right? The right should not be intransmissible. As a general rule, rights and obligations arising from contracts are transmissible, except: intransmissible by nature, or because of stipulation or because of law. How should it be with respect to thing? a. The thing must be within the commerce of man b. The thing must be licit (not contrary to law) c. The thing must be determinate The 1st sale involves sale of a car without agreement as to the features for 1M. The 2nd sale involves the sale of a Mitsubishi Lancer 2007 GSM color black for 1M. Are these 2 transactions valid sales? The second sale is valid, but the first is void because the former is particularly designated or physically segregated from all others of

the same class, and it has been made determinate at the time of the perfection of the contract without the need of a new or further agreement between the parties, unlike the first sale. (1460) A obliged himself to deliver and transfer ownership over palay that will be harvested from a specific parcel of rice land in May 2008. What is by May 2008, no palay was harvested? What is the status of the sale? The sale is valid because the law provides that sale of things having potential existence is a valid sale, for as long as consent of the contracting parties, object and cause/consideration with respect to sale are present. May A be held liable for damages for failure to comply with his obligation? Not necessarily, since there are excuses to non-performance such as due to fortuitous event (pestilence, typhoon). However, if the reason is because of the sellers negligence, then he cannot find support under 1174. Distinguish between emptio res speratae (sale of a thing having a potential existence) and emptio spei (sale of a hope) a. In the first, the uncertainty is with regard the quantity and quality, but not with regard the existence of the thing; in the second, the uncertainty is with regard the existence of the thing b. In the first, the contract deals with a future thing; in the second, the contract

deals with a present thing the hope or expectancy c. In the first, the sale is subject to the condition that the things should exist, so that if it does not, there is no contract for lack of an essential requisite; in the second, the sale produces effects even though the thing itself does not come into existence, since the subject matter is the hope itself A sold land to B with right to repurchase within a year, which A delivered. On the 3rd month, B sold the land to C. However, on the 9th month, A offered to repurchase the land. What is the status of the sale? The sale is valid because even if the object of the sale is a sale with a right to repurchase, since 1465 provides that things subject subject to a resolutory condition may be the object of a contract of sale. (Uribe: ownership of the thing, not the thing) Hence, because B there is already delivery, B is already the owner. Who will have a better right over the land? It depends. A has a better right if he properly exercises the right of repurchase with the period provided by law. C has a better right if C is a buyer in good faith and for value, which means that he has no knowledge of any encumberance. If the sale between A and B is registered, then C cannot claim to be a buyer in good faith.

3. Cause or Price Certain in Money or Its Equivalent

Yes, but the seller cannot be compelled to accept because under R.A. 7653, P1 coins only have legal tender power up to P50. Note: 25 centavos and above not exceeding P50; 10 centavos or less not exceeding P20 Shares of stocks valued at P5000 are being sold. However, there is no date as to the value of the shares. What is the status of the sale? This is void because of the uncertainty of the price. This is due to the fact that the date is very material, given that the value of the shares changes depending on the date. In fact, even if the date has been fixed, but the time has not been considered, such as the opening and closing with respect to such exchange, the validity of the sale is still affected. May the sale be perfected if one of the parties is designated to fix the price? Yes, provided that the price fixed must be accepted by the other party. A sells his 1976 Colt Lancer Sedan to B, a compadre, and leaves it to B to determine the price. If B refuses to fix a price and simply takes the car, is he still obliged to pay the price? Explain. Yes. This is clear from 1474. True, 1473 declares that the fixing of the price cannot be left to the discretion of one of the contracting parties. Therefore, As act is illegal. But, this will not effect the validity of the sale. According to 1474, if the thing

A deed of sale was entered into by A and B. The price agreed upon was 1M yen. May there be a valid sale? Yes, because the only requirement of the law is payment of price in money or its equivalent. Japanese yen is money. Note: Or its equivalent Promissory notes, whether negotiable or non-negotiable; Letters of Credit Can the seller compel the buyer to pay in yen? It depends on the date of the sale. If the contract was entered into during the effectivity of R.A. 529, then the seller can be compelled to pay. However, if the contract was entered into when R.A. 8183 came into effect, repealing R.A. 529, then the seller cannot be compelled to pay as the parties can stipulate which currency within which to pay. Is price the same as legal tender? No. While the price is the quantity or value of one thing that is exchanged or demanded in barter or sale, legal tender is the medium of payment allowed by law to be valid for meeting a financial obligation. Can there be a valid payment of P10,000 in P1 coins?

or any part thereof has been delivered to and appropriated by the buyer, as in the case, he must pay a reasonable price therefor. The price is fixed by a third person. May the sale be void? Yes, if the third person did not want to fix the price, or is unable to fix the price. Hence, there is no meeting of the minds. However, if such third person was able to fix the price, but it is too high or it is too low, the contract is not void. The remedy of such party is to go to court to fix the price. A parcel of land is valued at 1M. In the contract of sale, the price is only 10k. May the sale be valid? Yes, since gross inadequacy of price does not affect the contract of sale. When can the above sale be rescissible? In case the seller is the guardian and the property is owned by the ward, and the ward suffers lesion by more than 25% (1/4) of the value of the things which are the object thereof. What can be an exception to the lesion rule above stated? When the court approves of such sale When can the above sale be void? If the buyer is the guardian 1491 applies (relatively stimulated contract)

It is an agreement granting a privilege to buy or sell within an agreed time and at a determined price. It is a separate and distinct contract from which the parties may enter into upon the consummation of the option. It must be supported by consideration. Consideration need not be in money, but in any prestation to be performed.

Sanchez v. Rigos Sanchez brought an action for specific performance and damages. Rigos set up the defense that her contract with Sanchez is a mere unilateral offer to sell, and consequently, it since it is unsupported by a consideration, said promise is not binding. The action will prosper. In this case, there was no option contract but it was merely an option agreement. In unilateral offers to buy or to sell, the promisor is not bound by his promise and may, accordingly, withdraw it. Pending notice of his withdrawal, his promise partakes of the nature of an offer to sell, which, if accepted, results in a perfected contract of sale. There was merely an offer on the part of Rigos, and once the offer was accepted before it was withdrawn, regardless of whether the option money was given, and in this case no option money was given, a perfected contract of sale was created. 2 years within which to decide, assuming there was option money, before the offeree

What is an option contract?

could decide, the offeror withdrew on the 6th month. Can the offeree on the 10th month say I would like to buy? No, because the offer was withdrawn before it was accepted. already

If earnest money was paid, is there a perfected sale? Not necessarily. There may be earnest money paid, but there is no meeting of the minds as to the object of the sale. Earnest money is only a proof of a perfected contract of sale. If there is meeting of the minds as to the object of the sale, is the sale perfected? Not necessarily. There may be disagreements as to the total price. If stipulated, then that is when earnest money is part of the price. If not stipulated, then the earnest money is treated only as part of the option.

Can the buyer compel the seller to sell? No. An action for specific performance will not prosper because when he said he will buy, there was no more offer to be considered. If the offeree files an action for damages, will the action prosper there being option money given? Yes, because with the option money, an option contract is perfected. Therefore, the offeror is bound to give the offeree 2 years within which to decide. The offerors liability is not based on a perfected contract of sale, but on a perfected contract of option. Differentiate earnest money from option money. a. The former is paid to show eagerness to purchase, while the latter is given by the buyer as an option to decide whether to buy or not b. The former is paid after the contract is perfected, while latter is paid before acceptance of the offer; hence, this is still in the preparation stage c. In the former, the buyer is to pay the balance between the period stipulated, while in the latter, the buyer may or may not enter into the contract

What are the rights and obligations of the vendor imposed by law?

Note: In a deed of sale, there can be so many obligations of the vendor, but those obligations would be because of stipulation. (example: to have the land registered in the name of the buyer within 3 months from the date of the sale)

1. To transfer ownership

May a person sell something which does not belong to him, and he is not an agent?

Yes. The law does not require a person to be the owner of the thing at the time of the perfection of the sale. Can the buyer acquire ownership of the thing even if the seller is not the owner of the thing? Not necessarily. If the seller is a thief, then the buyer cannot acquire ownership over the thing. But in 1505, the buyer can acquire ownership when: a. The seller is authorized under the principle of agency. (1874) When a sale of a piece of land or any interest therein is through an agent, the authority of the agent shall be in writing otherwise, the sale is void. The agent sold the car to a person other than to a member of the organization as directed by the principal. Would that buyer acquire ownership even if the agent has no right to sell to that buyer? Yes, because under 1900, so far as third persons are concerned, they only have to rely on the SPA.

Yes, under the Mirror Principle. When the buyer bought it from the person in whose name the property was registered in good faith, and he relied on the TCT, then he will be considered as the owner under 1505 in relation to P.D. 1529 (Property Registration Decree). Hence, he would have a better right than the real owner. Note: No knowledge of defect + fully paid = good faith A owns a thing. B, without the right to sell, unlawfully deprived A of the ownership of the thing. B sold the thing to C. Can A have a right to recover the thing from C? If yes, is C entitled to reimbursement? Not necessarily. A can only recover if the thing was stolen. C is entitled to reimbursement if the thing was purchased by C in a public sale in good faith.

c. The seller has statutory power to sell or is authorized by the Court Having statutory power to sell (1505 notary public in pledge, liquidators, guardians, receivers) Having authority of the court to sell (Sheriff)

b. The apparent owner is enabled by any other provision of law to dispose of them as if he were the true owner May a forged deed be the root of a valid title?

d. Estoppel Estoppel in Pais:

A person is precluded from denying that another person has authority to sell because of his acts. Estoppel by Deed: When the seller who was not the owner at the time of the sale acquires ownership (inherits or the thing was donated to him), ownership automatically passes to the buyer by operation of law. Estoppel by Record: The seller cannot be allowed to claim that the third person was not authorized to sell after testifying in court that he gave such authority.

acquires no better title than what the seller had. However, 1505 also provides that the buyer who bought the thing from a merchants store and in good faith owns the thing. 559 does not apply in this case because Sun brothers was not unlawfully deprived of the refrigerator, neither was it lost. 559 will only apply if the owner was unlawfully deprived of the thing and recovery in such a case could only be done by reimbursing the buyer who bought the thing in good faith at a public sale. One painting owned by A was stolen from her. Later on, she noticed that the painting was in the room of B, and asked how he acquired the painting. B said that he acquired it in a gallery auction. Can A recover the painting from B? Yes. A gallery auction is not a public sale. Thus, the owner can recover the property even without reimbursement.

e. The buyer purchased the things in a merchants store, or in fairs, or markets, in accordance with the Code of Commerce and Special Laws Sun Brothers v. Velasco Sun brothers reserved ownership of a refrigerator that they were selling. Lopez paid only P300 out of the P1500. Lopez then sold the refrigerator to Velasco, who owns a store. Velasco then sold the refrigerator to Chu, who paid in full. When Sun brothers learned of this, it filed an action to recover the refrigerator from Chu. The suit will not prosper. Velasco did not acquire ownership of the refrigerator because under 1505, the buyer

f. The goods sold are covered by a negotiable document of title. If the buyer bought the goods in good faith and for value, he will be protected under the law.

How is transfer of ownership effected? It is effected by delivery, whether actual or constructive. There can be no transfer of ownership without delivery.

Is it correct to say that every time there is delivery, the buyer acquires ownership over the thing? Not necessarily. An instance is in case of conditional sale, where ownership is reserved by the seller such that despite delivery, ownership does not pass. The buyer would only acquire ownership upon the happening of the condition, such as full payment of the purchase price. Distinguish between sale or return from sale on trial. a. In the first, ownership passes to the vendee upon delivery; in the latter, ownership does not pass to the vendee until he accepts the goods after trial. b. In the first, the risk of loss is on the vendee; in the second, the risk of loss is on the vendor c. In the first, the vendee has a right to retain or reject and return the object delivered without reference to the quality; while in the second, the vendees right to retain or reject the thing is dependent upon the quality of the thing sold What is relevant to determine in case of Res Perit Domino? Whether at the time of the loss, there is already delivery Determination when ownership passed is important because if at the time of the loss, the buyer is not yet the owner, as a rule, the buyer will not bear the loss. If there was

already delivery, the buyer shall bear the loss. Notes: 1504 Unless agreed upon; but the buyer will still be at risk when the ownership in the goods has been retained by the seller merely to secure performance by the buyer of his obligation under the contract 1504 Not necessarily the buyers fault; if actual delivery has been delayed through the fault of either the buyer or the seller, the goods are at the risk of the party at fault A car was sold for P150,000. P75,000 was paid upon the execution of the deed of sale. The balance is not payable on a monthly basis. The car was delivered to the buyer. However, before he could pay the balance, the car was destroyed due to a fortuitous event. Can he still be compelled to pay the balance? Yes. Upon the delivery of the car, the ownership passed to the buyer. It was not stated in the facts that there was retention of ownership by the seller. Hence, under the rule on res perit domino, the owner bears the loss and hence, it can be compelled to pay the price. May the buyer bear the loss if there is delivery and the seller still has ownership, then the thing was lost due to a fortuitous event? Yes, if there is stipulation in the contract that the risk of loss shall pertain to the buyer from the time the thing is delivered whatever may be the cause of the loss.

Lawyers Cooperative v. Tabora The seller retains ownership, yet the buyer bears the loss. The AMJUR set was burned in the office of Atty. Tabora, who refused to pay the balance despite demand. Even if there is no stipulation in the contract that the risk of loss shall pertain to the buyer from the time the thing is delivered whatever may be the cause of the loss, the buyer will still bear the loss. Title may be reserved by the seller only to secure the fulfilment of the buyers obligation to pay the purchase price. Hence, the buyer will still bear the risk of loss. This title of the seller is known as Security Title. In sale on approval, who bears the loss? The seller, even if there is no delivery, because the seller is still the owner If the thing is sold twice, who would have the better right? It depends. If the property is movable, the buyer who may have first taken possession in good faith will have a better right. If the property is immovable, the person acquiring it who in good faith first recorded the sale in the Registry of Property is the owner. But should there be no registration, then ownership shall pertain to the buyer who in good faith was first in the possession. And should there be no

possession in good faith, to the person who presents the oldest title in good faith. A sold the land to B. Then, A sold the same land to C, who was without knowledge of the prior sale. Does this mean that C has a better right? Not necessarily. What is required by law is registration in good faith. It could happen that at the time of the sale, the buyer had no knowledge that there was a first sale, but when the second sale was about to be registered, the buyer had knowledge of the prior sale. Hence, he would be a registrant in bad faith. Bautista v. Sioson Legal possession is sufficient to determine as to who have a better right between two persons. C took possession of the land without knowledge of the prior sale between A and B. B did not take possession of the land and he leased it to A. A then sold the land to C. C argues that he took possession of the land in good faith, hence, he is entitled to the land. Yes, he is a possessor in good faith, however, since there was no registration of both sales to B and C, he is still not the first possessor. B was the first possessor even if he does not have physical possession of the land as owner-lessor. 1544 did not qualify possession.

B would have a better right because when he executed the lease agreement with A, he is in contemplation of law in possession which is legal possession over the thing, thus, making him a possessor in good faith. Carumba v. CA The parcel of land sold to B by A (judgment debtor) became the subject of an execution sale in Cs favour. C had no knowledge of the first sale. B would have a better right because this parcel of land was registered under the Torrens System. There was actual delivery to B. Therefore, under the general rule, upon deliver, ownership passes to the buyer. C could not get anything from the execution sale because he merely steps into the shoes of A, the judgment debtor. Since A had no ownership over the land at the time of sale, C did not acquire ownership by virtue of that sale.

Not necessarily. The buyer may turn out to be a depositary. Hence, what is material is possession and control.

The seller delivered 1200 pairs of shoes instead of 1000. May the buyer refuse to accept everything? No. He would only have the right to reject the excess, but he compelled to accept the 1000. Assuming if what was agreed upon was 1000, but the seller delivered only 800, can the buyer be compelled to receive the 800? No. Partial performance is non-performance. As a rule, a creditor cannot accept partial performance of the obligation, except when there is a stipulation that partial deliveries are allowed. The buyer accepted only 800 of the 1000, each pair for P1000. It so happened that the seller can no longer deliver the balance of 200. How much can the buyer be compelled to pay? If he was aware that the seller can no longer deliver the balance, then he can be compelled to pay at the contract rate. In this case, it is P800,000.when he accepted, then the buyer can only be compelled to pay the fair value of this thing. If he was not aware that the seller can no longer deliver the balance, then he can be compelled t pay only the fair value. Usually,

2. To deliver the object of the sale Distinguish the subject matter, whether it is a thing or right What are the 2 modes of delivery recognized by law? 1. Actual/Material/Physical/Real Delivery

A thing is physically delivered. There is transfer of ownership?

this is lower than the price. Likely, the fair value could be P700 each. The seller delivered 1200 cavans of both milagrosa and Cambodian rice, instead of the specific rice of Milagrosa, which was agreed upon. May the buyer have the right to reject everything? It depends. If the goods are indivisible, such as when Cambodian rice and milagrosa are mixed in one sack, then the buyer can reject everything. However, if in each sack it is clear that it is milagrosa or Cambodian, then, that would be considered indivisible, and he can only be compelled to accept Milagrosa, and reject the Cambodian rice.

Is the deliver of the keys symbolic delivery? Not necessarily, as it only becomes symbolic only if the goods are inside. What if the object of the sale is the warehouse itself, and the key is delivered, what kind of delivery is it? It is actual delivery because there is possession and control over the thing sold. What is involved if the thing was the subject matter of the lease, but the thing cannot be transferred to the buyer until the expiration of the lease? It is Traditio Longa Manu, where at the time of the sale, possession of the goods cannot be transferred to the buyer. Note: The obligation to deliver the thing on the part of the vendor may not arise in case of tradition brevi manu. What if, pursuant to their agreement, the seller delivered the goods to a common carrier. Upon delivery to the carrier, would the result in transfer of ownership immediately? Not necessarily. Although as a general rule, it is, but the seller may reserve ownership in the deed of sale; and even if the deed of sale does not provide for such stipulation, the seller may have obtained a bill of lading which provides that the goods are deliverable to the seller himself or the agent of the seller. What are the kinds of delivery of a right? 1. Execution of a public instrument

2. Constructive Delivery When a party remain in possession of the thing after the sale, what kind of constructive delivery is it? This depends on who is in possession: If it is the seller, then it is constitutum possessorium. He will continue to be in possession no longer as an owner, but in another capacity, like a lessee. If it is the buyer, then it is traditio brevi manu. He will continue to be in possession no longer as a lessee, but as an owner.

Example: In case of shares of stocks 2. Placing the certificate title of ownership in the possession of the buyer 3. Use by the vendee of his rights with the vendors consent The price agreed upon in the sale of a parcel of land is 100M. The land is more or less 100 sq.m. The actual area delivered by the seller is only 920 sq.m. What are the remedies of the buyer? 1. Specific performance if the seller is still in the position to deliver the balance, as when the lot beside also belongs to the seller; hence, he can afford to give the additional 80 sq.m. 2. Proportional reduction of the price (accion quanti minoris) if the sale was based at a rate of a certain price per unit of measure, like it was so clear in the contract that the land being sold is P10,000 per sq.m. so P10,000 sq.m. x 100 = P1M. This remedy is not, however, applicable, if the sale is a lump sum sale. But by way of exception, it is, if a part of the land delivered is of inferior quality than that stipulated by the parties. Under the facts, would rescission be a remedy? As a rule, no, because rescission could only be a remedy if the area lacking is more than 10% lf the area agreed upon. But by way of exception, yes, if the buyer can prove that he would not have bought the thing or land had he known that it is less than 100 sq.m. Also, if a part of the land

delivered is of inferior quality than that stipulated by the parties. The seller delivered the goods to the place of business of the buyer and the buyer refused to accept the goods. From that moment, does it mean that they buyer is already in delay because he refused to accept the goods? It depends on whether there is a stipulation as to the place of delivery or not. If there was, and the place agreed upon was not the place of business of the buyer, of course he would have the right to refuse to accept the delivery of the goods in his place of business. Note: With respect to the place of delivery, consider: stipulation, place fixed by usage or trade, place of business of the seller, sellers place of residence, where the thing is located at the time of perfection of the contract. If the sale is perfected, is the seller bound to deliver? Not necessarily. He may be stipulated to deliver with a certain period.