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Section 3 (Subsection 1-2)

Buenviaje, Jillian B.

Where the obligation of either
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 or his obligation to
deliver the same as described and was 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.

on the
happening of which the obligation of the contract

Contract of sale :
o Absolute
o Conditional

1) Either party is subject to any condition and such
condition is not fulfilled:
a. with the contract; or
b. with the contract, waiving the performance of the
2) If the condition is in the nature of a promise that it should
happen, the non- performance of such condition may be
treated as a
Jose (buyer) entered into a contract with Pedro
for the purchase of certain equipment. The
arrival of the goods to be shipped from Korea is
made a condition of the bargain, there being no
promise by Pedro that the goods will arrive. If
the equipment does not arrive, Pedro is not
guilty of breach of contract.
But if Pedro promises or warrants that the
equipment will be shipped or that it was already
in its way, the non-arrival constitutes a breach of
Representation made by the seller of the thing with
respect to its character, quality, or ownership, by which
be induces the buyer to purchase the same relying on
said representation.
Affirmation of fact
Promise by the seller
Natural tendency to induce the buyer to
purchase the thing.

Polly Pasta goes to her local StupendoMart and buys an
aluminum saucepan set made by the HotStuff
Manufacturing Company. Polly takes the pans home and
immediately cooks all her favorite dishes in them. To her
amazement and horror, the handles of all the pans
break, through no fault of hers. She looks at the box in
which the pans were packed and finds a "limited
warranty" which promises that the company will replace
defective pans at no cost. Polly has the right to
replacement pans in accordance with the terms of the
written express warranty.
No matter how positively asserted, does
not import a warranty unless the seller is
an .
o Implication or inference from the nature of transaction.
o The law attaches an obligation to the seller
o Not expressed in any words.

1) Implied warranty as to sellers title
2) Implied warranty against hidden defects or unknown
3) Implied warranty as to fitness or mechantability
Polly Pasta buys a Miraco Food Mixer. She unpacks the
mixer from its box when she gets it home and tries it out;
the mixer, however, will not mix food. In addition to any
express warranties made by the manufacturer or seller
of the mixer, Poly can rely on the implied warranty of
merchantability. This warranty may become important in
cases where the manufacturer or seller of the product
makes no express warranties and unsuccessfully tries to
disclaim implied warranties.
As is and where is sale
Sale of secondhand articles
Sale by virtue of authority in fact or law
o Judicial process whereby the vendee is deprived of the whole or
part of the things purchased by the virtue of a final judgment
based on a right prior to the sale or an act imputable to the
1) The vendee is deprived in whole or in part of the thing
2) He is so deprived by virtue of a final judgment.
3) the judgment is based on a right prior to the sale or an
act imputable to the vendor.
4) The vendor was summoned in the suit for eviction at the
instance of the vendee.
5) There is no waiver on the part of the vendee.

The vendee need not appeal from the
decision in order that the vendor may
become liable for eviction.
o Completed before sale
o Completed after sale

A sold to B a building which is claimed by C who has been in
possession of the property in the concept of owner publicly and
continuously for 30 years. Under the law, C is deemed to have
acquired ownership over the building by prescription without need
of title or of good faith.
In this case, A shall be liable to B in case of eviction.
If the property is sold for nonpayment of
taxes due and not made known to the
vendee before the sale, the vendor is
The is also
responsible for eviction in judicial
sales, unless it is otherwise decreed
in the judgment.
1) Effect of vendors bad faith
2) Effect of vendees bad faith
- voluntarily made by the vendee
without the knowledge and assumption of the risks
of eviction.
- waiver made by the vendor with
knowledge of the risk of eviction and assumption
of its consequences.
1) Return of value of thing
2) Income or fruits of thing
3) Costs of the suit
4) Expenses of the contract
5) Damages and interests
o 1556 deals with partial eviction while 1554
deals with total eviction
o 1556 states that if there is partial eviction, the
vendee has the option either to enforce the
vendors liability for eviction or to demand
rescission of the contract.
Dylan sells to Tyler a parcel of land, represented by
Dylan as containing 350 square meters, at the rate of
P1200 per square meter. Tyler needs a lot of at least
350 square meters on which to build a factory. Tyler is
evicted from a 20-square-meter portion of the land.
Tyler would not have bought the land had be known of
its smaller area.
Under the facts, Tyler can either sue for damages for
breach of warranty or demand rescission of the
contract. He can also exercise his alternative rights if
there were two parcels of land sold and he should
lose one of them by reason of eviction.
Final judgment of eviction essential.
o1557 merely reiterates two of the
essential elements for the
enforcement of warranty in case of
eviction namely:
1. deprivation in whole or in part
of the thing sold
2. existence of a final judgment
o Vendor not obliged to make good proper
o Unless summoned in the suit for eviction.

o Defendant vendee shall ask within the time
fixed in the Rules of Court.

encumbrance imposed upon an
immovable for the benefit of another
immovable belonging to a different
Vendor shall be responsible for
warranty against the hidden

The defects must be important or serious.
It must be hidden.
It must exist at the time of the sale.
The vendee must give notice of the defect to the
vendor within a reasonable time.
The action for rescission or reduction of the
price must be brought within the proper period.
There must be no waiver of warranty on the part
of the vendee.

Lydia sold to Stiles a car. After the sale,
Stiles discovered that the radiator and
other interior parts had been sunken in
flood and a result, the car was in danger of
overheating. The defects of the car were
hidden and concealed and were unknown
to Stiles until a closer inspection was
made by him.
o 1) Implied warranty of fitness
o 2) Implied warranty of merchantability
o Warranty that goods are reasonably fit for the general purpose
for which they are sold.

o Warranty that goods are suitable for the special purpose of the
buyer which will not be satisfied by mere fitness for general
Specified article under its patent or other trade name ,
there is no WARRANTY as to its fitness.
Unless there is stipulation.

o Derek buy a car in Toyota Inc. He chose a particular car and he
intended to enter it to a car race but this fact was not made
known to the seller.
o Toyota Inc. is not liable if Derek didnt informed them about the
purpose of the car.

An implied warranty or condition as to
the quality or fitness for a particular
purpose may be annexed by the
usage of trade.
o 1) Where sample were not
o 2) Where sample subject to latent defect
is to the
vendee for any
does apply if the
of the
The vendee may elect between:
o Withdrawing from the contract
o Demanding a proportionate reduction of
the price
Vendees right to recover:
A) Price paid
B) Expenses of the contract
C) Damages
Vendors obliged to return only:
A) Price
B) Interest
C) Expenses of the contract

If the vendor acted in . He shall
pay to the vendee.
o If thing sold had and loss
through a fortuitous event the fault must borne
by the .
o If the thing sold has at the
time of its loss the vendor is obliged to

The preceding articles in sub.
2 are applicable to
except the
shall not be liable to
o Ten preceding article shall be barred after 6 months,
from the delivery of the thing sold.

o Sale of two animals together

X sold 2 dogs to Y for P10000. If one of the dog is defective,
X is only liable of warranty on the defective animal only.
o Respect to the sale of animals shall in like manner be
applicable to the sale of other thing.

o No warranty to hidden defects of animals sold at fair,
public auctions, or livestock sold as condemned.

o Sale of contagious animal shall be void.
a defect in the article sold
against which defect the seller is bound to warrant.

o Limitation of action in sale of animals

o Responsibility of vendor where animal dies.

o Liability of buyer in case of sale of animal rescinded

o The sale of animals with redhibitory defects,
the vendee shall also enjoy the right
mentioned in art. 1167

o The form of sale of large cattle shall be
governed by special laws.