LAW ON SALES

Atty. Desiree Von D. Enriquez

Objective:
• Rehash on basic principles on Obligations and Contracts as a
preparatory discussion to the law on sales
– Definition of:
– Obligation
– Contract
– Elements of a contract
– Extinguishment of a contract
– Article 1169 (reciprocal contracts)

• Basic concept or bird’s eye view of sale

– Contract of Sale per se
– Stages in the Contract of Sale
– Is the contract of sale mode of acquiring ownership
– Essential characteristics of a contract of sale
– Elements of a contract of sale
– Kinds of Sales
SALES
ARTICLE 1458, NCC
By the contract of sale, one of the contracting parties obligates himself to
transfer the ownership of and to deliver a determine thing, and to deliver a
determinate thing, and the other to pay therefor a price certain in money or
its equivalent.
A contract of sale man be absolute or conditional.

• RECIPROCAL OBLIGATION
1. Transfer the ownership of and to deliver a determinate thing;
2. To pay a price certain in money or its equivalent
STAGES IN THE CONTRACT OF SALE
1. Generation or negotiation
2. Perfection
3. consummation
CHARACTERITICS OF A CONTRACT OF SALE:
1. Consensual
A contract of sale is perfected by mere consent
2. Bilateral
Gives rise to reciprocal obligations
3. Principal
Can stand by it slef
4. Onerous
The consideration for each part is the delivery of the thing or the
payment of the price
5. Commutative
Delivery is equivalent of the payment price paid
6. Nominate
Designated name under the Civil Code of the Philippines
7. Transmissive of ownership
Transfers ownership of the subject matter
REQUISITES OF A
CONTRACT OF SALE
 ESSENTIAL REQUISITES or ELEMENTS
(those without which there can be NO VALID SALE)

• CONSENT
– Is manifested as the meeting of the offer and the acceptance upon the
thing and the cause which are to constitute the contract

• OBJECT or SUBJECT MATTER

– It must be existing or possible (Article 1461, 1462, 1463, 1464 NCC)
– It must be licit
– It must be determining (Article 1460, NCC)
(the thing and the price are the subject matter, Article 1473, NCC)

• CAUSE or CONSIDERATION
– Price certain in money or its equivalent (SELLER’s POV) Article 1473, 1474,
NCC
– Thing in a contract of sale (BUYER’s POV)
ARTICLE 1461 par 1: emptio rei
speratae
• Sale of things with potential existence
• May be the object of the contract of sale
• There may be a valid sale of a thing, which though not yet in
existence as the natural increment or usual incident of
something already in existence and still belonging to the
seller, the title shall be transferred to the buyer the moment
the thing comes to existence.
Ex:
future wool grown on a sheep, wine is expected to be produced by a
vineyard
ARTICLE 1461 par 2: emptio spei
• Sale of hope or expectancy
• Neither the thing nor its quantity and quality are certain to
exist
Ex:
Sale of sweepstakes or raffle ticket that is yet to be drawn
NB:
If the sale of the ticket is for a sweepstake or raffle that has already been
drawn and the object of the sale is a losing ticket, the sale is VOID as it
involves the sale of vain hope or expectancy.

SALE OF VAIN HOPE or EXPECTANCY is VOID.

ARTICLE 1460: Determinate Thing
1. When thing is Determinate
-- is particularly designated or physically segregated from all
others of the same class.
-- it is a concrete , particularized object , indicated by its own
individuality , such as cereal grown in a particular area.
-- or in contract of sale of real estate , the property with its
location , description and boundaries.

It is not required that the thing sold must be in sight at the time
the contract is entered into.
It is sufficient that it is capable of being made determinate
without the necessity of a new or further agreement between
the parties.
Contract of sale not perfected unless the thing is determinate.
-- one of the requisites of a valid contract of sale is that the
subject matter must be determinate. Accordingly, a contract of
sale is not perfected until the parties have agreed upon not only
the price but also the thing sold.
 NATURAL REQUISITES or ELEMENTS
(those which in the absence of any contrary provision, are deemed to exist in the
contract)

1. Warranty against eviction (deprivation of the property bought)

2. Warranty against hidden defects

ACCIDENTAL ELEMENTS
• Sale by Auction
• Sale by Installment
– Maceda Law
– Recto Law

• Chattel Mortgage Law (Article 1484)

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