E.

WARRANTIES

as has been paid, concurrently with the return of the goods, or immediately after an
offer to return the goods in exchange for repayment of the price.

1. Express Warranties
a. Distinguished from Condition
SECTION 3
Conditions and Warranties
Article 1545. Where the obligation of either party to a contract of sale is subject to any condition
which is not performed, such party may refuse to proceed with the contract or he may waive
performance of the condition. If the other party has promised that the condition should happen or
be performed, such first mentioned party may also treat the nonperformance of the condition as
a breach of warranty.
Where the ownership in the thing has not passed, the buyer may treat the fulfillment by the seller
of his obligation to deliver the same as described and as warranted expressly or by implication in
the contract of sale as a condition of the obligation of the buyer to perform his promise to accept
and pay for the thing. (n)
Article 1599. Where there is a breach of warranty by the seller, the buyer may, at his election:
(1) Accept or keep the goods and set up against the seller, the breach of warranty by
way of recoupment in diminution or extinction of the price;
(2) Accept or keep the goods and maintain an action against the seller for damages
for the breach of warranty;
(3) Refuse to accept the goods, and maintain an action against the seller for damages
for the breach of warranty;
(4) Rescind the contract of sale and refuse to receive the goods or if the goods have
already been received, return them or offer to return them to the seller and recover the
price or any part thereof which has been paid.
When the buyer has claimed and been granted a remedy in anyone of these ways, no
other remedy can thereafter be granted, without prejudice to the provisions of the
second paragraph of article 1191.
Where the goods have been delivered to the buyer, he cannot rescind the sale if he
knew of the breach of warranty when he accepted the goods without protest, or if he
fails to notify the seller within a reasonable time of the election to rescind, or if he fails
to return or to offer to return the goods to the seller in substantially as good condition
as they were in at the time the ownership was transferred to the buyer. But if
deterioration or injury of the goods is due to the breach or warranty, such deterioration
or injury shall not prevent the buyer from returning or offering to return the goods to
the seller and rescinding the sale.
Where the buyer is entitled to rescind the sale and elects to do so, he shall cease to
be liable for the price upon returning or offering to return the goods. If the price or any
part thereof has already been paid, the seller shall be liable to repay so much thereof

Where the buyer is entitled to rescind the sale and elects to do so, if the seller refuses
to accept an offer of the buyer to return the goods, the buyer shall thereafter be
deemed to hold the goods as bailee for the seller, but subject to a lien to secure the
payment of any portion of the price which has been paid, and with the remedies for
the enforcement of such lien allowed to an unpaid seller by article 1526.
(5) In the case of breach of warranty of quality, such loss, in the absence of special
circumstances showing proximate damage of a greater amount, is the difference
between the value of the goods at the time of delivery to the buyer and the value they
would have had if they had answered to the warranty. (n)
b. Distinguished from Opinion, Dealers Talk
Article 1546. Any affirmation of fact or any promise by the seller relating to the thing is
an express warranty if the natural tendency of such affirmation or promise is to induce the buyer
to purchase the same, and if the buyer purchases the thing relying thereon. No affirmation of the
value of the thing, nor any statement purporting to be a statement of the seller's opinion only,
shall be construed as a warranty, unless the seller made such affirmation or statement as an
expert and it was relied upon by the buyer. (n)
Article 1341. A mere expression of an opinion does not signify fraud, unless made by an expert
and the other party has relied on the former's special knowledge. (n)
c. Distinguished from False Representaion

2. Implied Warranties
a. Implied Warranty of Title
Article 1590. Should the vendee be disturbed in the possession or ownership of the
thing acquired, or should he have reasonable grounds to fear such disturbance, by a vindicatory
action or a foreclosure of mortgage, he may suspend the payment of the price until the vendor
has caused the disturbance or danger to cease, unless the latter gives security for the return of
the price in a proper case, or it has been stipulated that, notwithstanding any such contingency,
the vendee shall be bound to make the payment. A mere act of trespass shall not authorize the
suspension of the payment of the price. (1502a)
1.

Eviction by Judgment

Article 1547. In a contract of sale, unless a contrary intention appears, there is:
(1) An implied warranty on the part of the seller that he has a right to sell the thing at
the time when the ownership is to pass, and that the buyer shall from that time have
and enjoy the legal and peaceful possession of the thing;

(2) An implied warranty that the thing shall be free from any hidden faults or defects,
or any charge or encumbrance not declared or known to the buyer.
This article shall not, however, be held to render liable a sheriff, auctioneer,
mortgagee, pledgee, or other person professing to sell by virtue of authority in fact or
law, for the sale of a thing in which a third person has a legal or equitable interest. (n)

eviction. Should the vendee have made the waiver with knowledge of the risks of eviction and
assumed its consequences, the vendor shall not be liable. (1477)
3.

Effects of Eviction

Article 1555. When the warranty has been agreed upon or nothing has been stipulated on this
point, in case eviction occurs, the vendee shall have the right to demand of the vendor:

SUBSECTION 1. Warranty in Case of Eviction

Article 1548. Eviction shall take place whenever by a final judgment based on a right prior to the
sale or an act imputable to the vendor, the vendee is deprived of the whole or of a part of the
thing purchased.
The vendor shall answer for the eviction even though nothing has been said in the contract on
the subject.
The contracting parties, however, may increase, diminish, or suppress this legal obligation of the
vendor. (1475a)
Article 1550. When adverse possession had been commenced before the sale but the
prescriptive period is completed after the transfer, the vendor shall not be liable for eviction. (n)
Article 1551. If the property is sold for nonpayment of taxes due and not made known to the
vendee before the sale, the vendor is liable for eviction. (n)
Article 1555. When the warranty has been agreed upon or nothing has been stipulated on this
point, in case eviction occurs, the vendee shall have the right to demand of the vendor:
(1) The return of the value which the thing sold had at the time of the eviction, be it
greater or less than the price of the sale;
(2) The income or fruits, if he has been ordered to deliver them to the party who won
the suit against him;
(3) The costs of the suit which caused the eviction, and, in a proper case, those of the
suit brought against the vendor for the warranty;
(4) The expenses of the contract, if the vendee has paid them;
(5) The damages and interests, and ornamental expenses, if the sale was made in
bad faith. (1478)
Article 1557. The warranty cannot be enforced until a final judgment has been rendered,
whereby the vendee loses the thing acquired or a part thereof. (1480)
2.

Waiver

Article 1554. If the vendee has renounced the right to warranty in case of eviction, and eviction
should take place, the vendor shall only pay the value which the thing sold had at the time of the

(1) The return of the value which the thing sold had at the time of the eviction, be it
greater or less than the price of the sale;
(2) The income or fruits, if he has been ordered to deliver them to the party who won
the suit against him;
(3) The costs of the suit which caused the eviction, and, in a proper case, those of the
suit brought against the vendor for the warranty;
(4) The expenses of the contract, if the vendee has paid them;
(5) The damages and interests, and ornamental expenses, if the sale was made in
bad faith. (1478)
ARTICLE 548. Expenses for pure luxury or mere pleasure shall not be refunded to the
possessor in good faith; but he may remove the ornaments with which he has embellished the
principal thing if it suffers no injury thereby, and if his successor in the possession does not
prefer to refund the amount expended. (454)
Article 1548. Eviction shall take place whenever by a final judgment based on a right prior to the
sale or an act imputable to the vendor, the vendee is deprived of the whole or of a part of the
thing purchased.
The vendor shall answer for the eviction even though nothing has been said in the contract on
the subject.
The contracting parties, however, may increase, diminish, or suppress this legal obligation of the
vendor. (1475a)
Article 1556. Should the vendee lose, by reason of the eviction, a part of the thing sold of such
importance, in relation to the whole, that he would not have bought it without said part, he may
demand the rescission of the contract; but with the obligation to return the thing without other
encumbrances that those which it had when he acquired it.
He may exercise this right of action, instead of enforcing the vendor's liability for eviction.
The same rule shall be observed when two or more things have been jointly sold for a lump
sum, or for a separate price for each of them, if it should clearly appear that the vendee would
not have purchased one without the other. (1479a)
Article 1599. Where there is a breach of warranty by the seller, the buyer may, at his election:

(1) Accept or keep the goods and set up against the seller, the breach of warranty by
way of recoupment in diminution or extinction of the price;

SUBSECTION 2. Warranty Against Hidden Defects of or Encumbrances Upon the Thing

Sold

(2) Accept or keep the goods and maintain an action against the seller for damages
for the breach of warranty;

Article 1561. The vendor shall be responsible for warranty against the hidden defects which the
thing sold may have, should they render it unfit for the use for which it is intended, or should they
diminish its fitness for such use to such an extent that, had the vendee been aware thereof, he
would not have acquired it or would have given a lower price for it; but said vendor shall not be
answerable for patent defects or those which may be visible, or for those which are not visible if
the vendee is an expert who, by reason of his trade or profession, should have known them.
(1484a)

(3) Refuse to accept the goods, and maintain an action against the seller for damages
for the breach of warranty;
(4) Rescind the contract of sale and refuse to receive the goods or if the goods have
already been received, return them or offer to return them to the seller and recover the
price or any part thereof which has been paid.
When the buyer has claimed and been granted a remedy in anyone of these ways, no
other remedy can thereafter be granted, without prejudice to the provisions of the
second paragraph of article 1191.
Where the goods have been delivered to the buyer, he cannot rescind the sale if he
knew of the breach of warranty when he accepted the goods without protest, or if he
fails to notify the seller within a reasonable time of the election to rescind, or if he fails
to return or to offer to return the goods to the seller in substantially as good condition
as they were in at the time the ownership was transferred to the buyer. But if
deterioration or injury of the goods is due to the breach or warranty, such deterioration
or injury shall not prevent the buyer from returning or offering to return the goods to
the seller and rescinding the sale.
Where the buyer is entitled to rescind the sale and elects to do so, he shall cease to
be liable for the price upon returning or offering to return the goods. If the price or any
part thereof has already been paid, the seller shall be liable to repay so much thereof
as has been paid, concurrently with the return of the goods, or immediately after an
offer to return the goods in exchange for repayment of the price.
Where the buyer is entitled to rescind the sale and elects to do so, if the seller refuses
to accept an offer of the buyer to return the goods, the buyer shall thereafter be
deemed to hold the goods as bailee for the seller, but subject to a lien to secure the
payment of any portion of the price which has been paid, and with the remedies for
the enforcement of such lien allowed to an unpaid seller by article 1526.
(5) In the case of breach of warranty of quality, such loss, in the absence of special
circumstances showing proximate damage of a greater amount, is the difference
between the value of the goods at the time of delivery to the buyer and the value they
would have had if they had answered to the warranty. (n)
b. Implied Warranty Against Encumbrances or Defects
Article 1567. In the cases of articles 1561, 1562, 1564, 1565 and 1566, the vendee may elect
between withdrawing from the contract and demanding a proportionate reduction of the price,
with damages in either case. (1486a)
1.

Hidden Encumbrances or Defects

Article 1562. In a sale of goods, there is an implied warranty or condition as to the quality or
fitness of the goods, as follows:
(1) Where the buyer, expressly or by implication, makes known to the seller the
particular purpose for which the goods are acquired, and it appears that the buyer
relies on the seller's skill or judgment (whether he be the grower or manufacturer or
not), there is an implied warranty that the goods shall be reasonably fit for such
purpose;
(2) Where the goods are brought by description from a seller who deals in goods of
that description (whether he be the grower or manufacturer or not), there is an implied
warranty that the goods shall be of merchantable quality. (n)
Article 1563. In the case of contract of sale of a specified article under its patent or other trade
name, there is no warranty as to its fitness for any particular purpose, unless there is a
stipulation to the contrary. (n)
Article 1564. An implied warranty or condition as to the quality or fitness for a particular purpose
may be annexed by the usage of trade. (n)
Article 1565. In the case of a contract of sale by sample, if the seller is a dealer in goods of that
kind, there is an implied warranty that the goods shall be free from any defect rendering them
unmerchantable which would not be apparent on reasonable examination of the sample. (n)
Article 1566. The vendor is responsible to the vendee for any hidden faults or defects in the
thing sold, even though he was not aware thereof.
This provision shall not apply if the contrary has been stipulated, and the vendor was not aware
of the hidden faults or defects in the thing sold. (1485)
Article 1567. In the cases of articles 1561, 1562, 1564, 1565 and 1566, the vendee may elect
between withdrawing from the contract and demanding a proportionate reduction of the price,
with damages in either case. (1486a)
Article 1568. If the thing sold should be lost in consequence of the hidden faults, and the vendor
was aware of them, he shall bear the loss, and shall be obliged to return the price and refund the
expenses of the contract, with damages. If he was not aware of them, he shall only return the
price and interest thereon, and reimburse the expenses of the contract which the vendee might
have paid. (1487a)

Article 1569. If the thing sold had any hidden fault at the time of the sale, and should thereafter
be lost by a fortuitous event or through the fault of the vendee, the latter may demand of the
vendor the price which he paid, less the value which the thing had when it was lost.
If the vendor acted in bad faith, he shall pay damages to the vendee. (1488a)

Article 1580. In the sale of animals with redhibitory defects, the vendee shall also enjoy the right
mentioned in article 1567; but he must make use thereof within the same period which has been
fixed for the exercise of the redhibitory action. (1499)
2.

Warranties in Sales of Animals/ Redhibitory Defects

Article 1570. The preceding articles of this Subsection shall be applicable to judicial sales,
except that the judgment debtor shall not be liable for damages. (1489a)

Article 1574. There is no warranty against hidden defects of animals sold at fairs or at public
auctions, or of live stock sold as condemned. (1493a)

Article 1571. Actions arising from the provisions of the preceding ten articles shall be barred
after six months, from the delivery of the thing sold. (1490)

Article 1575. The sale of animals suffering from contagious diseases shall be void.

Article 1572. 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. (1491)
Article 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. (1492)
Article 1574. There is no warranty against hidden defects of animals sold at fairs or at public
auctions, or of live stock sold as condemned. (1493a)
Article 1575. The sale of animals suffering from contagious diseases shall be void.
A contract of sale of animals shall also be void if the use or service for which they are acquired
has been stated in the contract, and they are found to be unfit therefor. (1494a)
Article 1576. If the hidden defect of animals, even in case a professional inspection has been
made, should be of such a nature that expert knowledge is not sufficient to discover it, the defect
shall be considered as redhibitory.
But if the veterinarian, through ignorance or bad faith should fail to discover or disclose it, he
shall be liable for damages. (1495)
Article 1577. The redhibitory action, based on the faults or defects of animals, must be brought
within forty days from the date of their delivery to the vendee.
This action can only be exercised with respect to faults and defects which are determined by law
or by local customs. (1496a)
Article 1578. If the animal should die within three days after its purchase, the vendor shall be
liable if the disease which cause the death existed at the time of the contract. (1497a)
Article 1579. If the sale be rescinded, 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 the redhibitory fault or defect. (1498)

A contract of sale of animals shall also be void if the use or service for which they are acquired
has been stated in the contract, and they are found to be unfit therefor. (1494a)
Article 1576. If the hidden defect of animals, even in case a professional inspection has been
made, should be of such a nature that expert knowledge is not sufficient to discover it, the defect
shall be considered as redhibitory.
But if the veterinarian, through ignorance or bad faith should fail to discover or disclose it, he
shall be liable for damages. (1495)
Article 1577. The redhibitory action, based on the faults or defects of animals, must be brought
within forty days from the date of their delivery to the vendee.
This action can only be exercised with respect to faults and defects which are determined by law
or by local customs. (1496a)
Article 1578. If the animal should die within three days after its purchase, the vendor shall be
liable if the disease which cause the death existed at the time of the contract. (1497a)
Article 1579. If the sale be rescinded, 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 the redhibitory fault or defect. (1498)
Article 1580. In the sale of animals with redhibitory defects, the vendee shall also enjoy the right
mentioned in article 1567; but he must make use thereof within the same period which has been
fixed for the exercise of the redhibitory action. (1499)
3.

Sale by Sample or Description/Merchantable Quality

Article 1574. There is no warranty against hidden defects of animals sold at fairs or at public
auctions, or of live stock sold as condemned. (1493a)
Article 1481. In the contract of sale of goods by description or by sample, the contract may be
rescinded if the bulk of the goods delivered do not correspond with the description or the
sample, and if the contract be by sample as well as description, it is not sufficient that the bulk of
goods correspond with the sample if they do not also correspond with the description.
The buyer shall have a reasonable opportunity of comparing the bulk with the description or the
sample. (n)

Article 1562. In a sale of goods, there is an implied warranty or condition as to the quality or
fitness of the goods, as follows:
(1) Where the buyer, expressly or by implication, makes known to the seller the
particular purpose for which the goods are acquired, and it appears that the buyer
relies on the seller's skill or judgment (whether he be the grower or manufacturer or
not), there is an implied warranty that the goods shall be reasonably fit for such
purpose;
**(2) Where the goods are brought by description from a seller who deals in goods of
that description (whether he be the grower or manufacturer or not), there is an implied
warranty that the goods shall be of merchantable quality. (n)
Article 1565. In the case of a contract of sale by sample, if the seller is a dealer in
goods of that kind, there is an implied warranty that the goods shall be free from any
defect rendering them unmerchantable which would not be apparent on reasonable
examination of the sample. (n)
c. Implied Warranty of Quality
1. Fitness for a Particular Purpose
Article 1562. In a sale of goods, there is an implied warranty or condition as to the quality or
fitness of the goods, as follows:
**(1) Where the buyer, expressly or by implication, makes known to the seller the
particular purpose for which the goods are acquired, and it appears that the buyer
relies on the seller's skill or judgment (whether he be the grower or manufacturer or
not), there is an implied warranty that the goods shall be reasonably fit for such
purpose;
(2) Where the goods are brought by description from a seller who deals in goods of
that description (whether he be the grower or manufacturer or not), there is an implied
warranty that the goods shall be of merchantable quality. (n)
Article 1564. An implied warranty or condition as to the quality or fitness for a particular purpose
may be annexed by the usage of trade. (n)
Article 1563. In the case of contract of sale of a specified article under its patent or other trade
name, there is no warranty as to its fitness for any particular purpose, unless there is a
stipulation to the contrary. (n)
d. Consumer Act RA 7394, Sec 68(4)
Article 68. Additional Provisions on Warranties. In addition to the Civil Code provisions on
sale with warranties, the following provisions shall govern the sale of consumer products with
warranty:
a) Terms of express warranty. Any seller or manufacturer who gives an express
warranty shall:

1) set forth the terms of warranty in clear and readily understandable

language and clearly identify himself as the warrantor;
2) identify the party to whom the warranty is extended;
3) state the products or parts covered;
4) state what the warrantor will do in the event of a defect, malfunction of
failure to conform to the written warranty and at whose expense;
5) state what the consumer must do to avail of the rights which accrue to
the warranty; and
6) stipulate the period within which, after notice of defect, malfunction or
failure to conform to the warranty, the warrantor will perform any obligation
under the warranty.
b) Express warranty operative from moment of sale. All written warranties or
guarantees issued by a manufacturer, producer, or importer shall be operative from
the moment of sale.
1) Sales Report. All sales made by distributors of products covered by this
Article shall be reported to the manufacturer, producer, or importer of the
product sold within thirty (30) days from date of purchase, unless otherwise
agreed upon. The report shall contain, among others, the date of purchase,
model of the product bought, its serial number, name and address of the
buyer. The report made in accordance with this provision shall be equivalent
to a warranty registration with the manufacturer, producer, or importer. Such
registration is sufficient to hold the manufacturer, producer, or importer
liable, in appropriate cases, under its warranty.
2) Failure to make or send report. Failure of the distributor to make the
report or send them the form required by the manufacturer, producer, or
importer shall relieve the latter of its liability under the warranty: Provided,
however, That the distributor who failed to comply with its obligation to send
the sales reports shall be personally liable under the warranty. For this
purpose, the manufacturer shall be obligated to make good the warranty at
the expense of the distributor.
3) Retail. The retailer shall be subsidiarily liable under the warranty in
case of failure of both the manufacturer and distributor to honor the
warranty. In such case, the retailer shall shoulder the expenses and costs
necessary to honor the warranty. Nothing therein shall prevent the retailer
from proceeding against the distributor or manufacturer.
4) Enforcement of warranty or guarantee. The warranty rights can be
enforced by presentment of a claim. To this end, the purchaser needs only
to present to the immediate seller either the warranty card of the official
receipt along with the product to be serviced or returned to the immediate
seller. No other documentary requirement shall be demanded from the
purchaser. If the immediate seller is the manufacturer's factory or
showroom, the warranty shall immediately be honored. If the product was
purchased from a distributor, the distributor shall likewise immediately honor

the warranty. In the case of a retailer other than the distributor, the former
shall take responsibility without cost to the buyer of presenting the warranty
claim to the distributor in the consumer's behalf.
5) Record of purchases. Distributors and retailers covered by this Article
shall keep a record of all purchases covered by a warranty or guarantee for
such period of time corresponding to the lifetime of the product's respective
warranties or guarantees.
6) Contrary stipulations null and void. All covenants, stipulations or
agreements contrary to the provisions of this Article shall be without legal
effect.
c) Designation of warranties. A written warranty shall clearly and conspicuously
designate such warranty as:
1) "Full warranty" if the written warranty meets the minimum requirements
set forth in paragraph (d); or
2) "Limited warranty" if the written warranty does not meet such minimum
requirements.
d) Minimum standards for warranties. For the warrantor of a consumer product to
meet the minimum standards for warranty, he shall:
1) remedy such consumer product within a reasonable time and without
charge in case of a defect, malfunction or failure to conform to such written
warranty;
2) permit the consumer to elect whether to ask for a refund or replacement
without charge of such product or part, as the case may be, where after
reasonable number of attempts to remedy the defect or malfunction, the
product continues to have the defect or to malfunction.
The warrantor will not be required to perform the above duties if he can show that the
defect, malfunction or failure to conform to a written warranty was caused by damage
due to unreasonable use thereof.
e) Duration of warranty. The seller and the consumer may stipulate the period within
which the express warranty shall be enforceable. If the implied warranty on
merchantability accompanies an express warranty, both will be of equal duration.
Any other implied warranty shall endure not less than sixty (60) days nor more than
one (1) year following the sale of new consumer products.
f) Breach of warranties. 1) In case of breach of express warranty, the consumer may
elect to have the goods repaired or its purchase price refunded by the warrantor. In
case the repair of the product in whole or in part is elected, the warranty work must be
made to conform to the express warranty within thirty (30) days by either the warrantor
or his representative. The thirty-day period, however, may be extended by conditions
which are beyond the control of the warrantor or his representative. In case the refund

of the purchase price is elected, the amount directly attributable to the use of the
consumer prior to the discovery of the non-conformity shall be deducted.
2) In case of breach of implied warranty, the consumer may retain in the
goods and recover damages, or reject the goods, cancel and contract and
recover from the seller so much of the purchase price as has been paid,
including damages.