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DE LA SALLE UNIVERSITY

College of Law
SALES (LAW 304M)
Course Description
This two-unit course is designed to provide law students with a
thorough understanding of the contract of Sale its definition, elements,
characteristics, kinds, stages and extinguishment. There will be discussions
on the rights and obligations of parties to a contract of sale. Finally, the
course also covers available remedies for breach of contract of sale.
Course Requirements
1. Active Participation in Class Discussions/ Quizzes (30%)
2. Midterm Examination (30%)
3. Final Examination (40%)
Basic References
Civil Code of the Philippines (R.A. 386) as amended
Sales, by Baviera, Araceli, UP Law Complex or any other commentary on
Sales
Other pertinent laws
Cases on Sales decided by the Supreme Court
Discussion Guide
Session One
Organizational Meeting
Overview of the Course Content and Methodology
Organizational Matters and Course Completion
Class Coordinator/s
Email Group

Session Two

I.

In General
A.

Definition - Art. 1458(1)

Villonco Realty Company v. Bormaheco, Inc., 65 SCRA 352, July


25, 1975
Ang Yu Asuncion v. Court of Appeals, 238 SCRA 602, December
2, 1994
Vda. De Ape v. Court of Appeals, 456 SCRA 193, April 15, 2005
Torcuator v. Bernabe, 459 SCRA 439, June 8, 2005
B.

History
Governing Law RA No. 386 (August 30, 1950); Arts. 1488, 1637
Commercial & Civil Sales

C.

Characteristics
1.
2.
3.
4.
5.
6.

consensual Art. 1475


bilateral - Art. 1458
onerous Art. 1350
commutative - Art. 2010
principal
nominate Art. 1458

Gaite v. Fonacier, 2 SCRA 830, July 31, 1961


D.

Stages
1.
2.
3.
4.

Negotiation
Perfection Arts. 1315, 1475
Performance - Arts. 1191, 1403(2)
Consummation

Ainza v. Padua, 462 SCRA 614, June 30, 2005


Session Three
E.

Kinds of Sale - Arts. 1458(2), 1488, 1544, 1403,


Maceda Law, Recto Law, 1477, 1501)
1.

As to the nature of the subject matter


a.
Sale of real property
b.
Sale of personal property

1.

As to whether the object is tangible or intangible/corporeal


or incorporeal
a.
sale of thing
b.
sale of right

2.

As to validity or defect of the transaction


a.
valid sale
b.
rescissible
c.
voidable
d.
unenforceable
e.
void

3.

As to the presence or absence of condition


a.
absolute sale
b.
conditional sale [Art. 1458]
c.
contract to sell

McCullough v. Berger, 43 Phil 823, September 26, 1922


Dichoso v. Roxas, 5 SCRA 781, July 31, 1962
Luzon Brokerage v. Maritime Building, 43 SCRA 93, January 21,
1972
Portic v. Cristobal, 456 SCRA 577, April 22, 2005
Heirs of Jesus M. Mascunana v. Court of Appeals, 461 SCRA 186,
June 23, 2005
Ursal v. Court of Appeals, 473 SCRA 52, October 14, 2005
Carrascoso, Jr. v. Court of Appeals, 477 SCRA 666, December 14,
2005
Sacobia Hills Devt Corp. v. Ty, 470 SCRA 395, September 20,
2005
Keppel Bank V. Adao, 473 SCRA 372, October 19, 2005
Edrada v. Ramos, 468 SCRA 597, August 31, 2005
Session Four
F.

Distinguished from other transactions


1.
1467
2.
3.
4.
5.

Contract for a Piece of Work (Massachusetts Rule) - Art.


Contract of Lease with Option to Buy
Dacion en Pago Art. 1245
Barter or Exchange Arts. 1468, 1638, 1954
Agency to Sell Art. 1466

Heacock v. Buntal Manufacturing Co., 66 Phil 245, September 26,


1938
Quiroga v. Parsons Hardware, 38 Phil 501, August 23, 1918

Ker v. Lingad, 38 SCRA 524, April 30, 1971


Del Monte Phils. v. Aragones, 461 SCRA 139, June 23, 2005
II.

Elements of a Contract of Sale


A. Essential Elements
1.

Consent of the contracting parties


Parties to the Contract
Capacity of Parties- Arts. 1489, 1390, 1403
a.
b.

absolute - Arts. 1327-1328, Art. 234Family Code (FC)


as amended by RA 6809
relative Art. XII, Secs. 7 & 8, 1987 Constitution
Arts. 1490-1492, 1533(5), 1476(4), 124FC,

Rodriguez v. Mactal, 60 Phil 13, April 4, 1934


Rubias v. Batiller, 51 SCRA 120, May 29, 1973
Miguel v. Catalino, 26 SCRA 234, November 29, 1968
Estate of Salvador Serra Serra v. Heirs of Primitivo Hernaez, 466 SCRA
120, August 9, 2005
Mapalo v. Mapalo, 17 SCRA 114, May 19, 1966
Session Five
2.

Subject matter (things & rights)- Arts. 1347, 1311,


1636(goods)
Requisites- Arts. 1458(1), 1459-1462, 1347-1349
Rules on the object of a contract of sale- Arts. 1463-1465
Assignment of Credit and Other Incorporeal Rights- Arts.
1624-1635

Martinez v. Court of Appeals, 56 SCRA 647, April 29, 1974


Melliza v. City of Iloilo, 23 SCRA 477, April 30, 1968
3.

Cause - Arts. 1350, 1352-1353

Price certain in money- Arts. 1469, 1471-1474, 1308; RA 529,


RA8183, PD72
Earnest Money- Art. 1482
Lesion - Arts. 1470, 1355
Villonco Realty Company v. Bormaheco, Inc., supra

Spouses Doromal , Sr. and Salas v. Court of Appeals, 66 SCRA 575,


September 5, 1975
Goldenrod v. Court of Appeals, 299 SCRA 141, November 24, 1998
Edrada v. Ramos, 468 SCRA 597, August 31, 2005
Philippine Free Press, Inc. v. Court of Appeals, 473 SCRA 639,
October 24, 2005
Cruz v. Fernando, Sr., 477 SCRA 173, December 9, 2005
Morales Devt Co. v. Court of Appeals, 27 SCRA 484, March 28,
1969
Laperal v. Rogers, 13 SCRA 26, January 30, 1965
De Leon v. Salvador, 36 SCRA 566, December 28, 1970
Velasco v. Court of Appeals, 51 SCRA 439, June 29, 1973
B. Natural Elements
1.
2.

warranties
subrogation

C. Accidental Elements
Session Six
III.

Perfection of the Contract


A.

When perfected- Arts. 1475-1476, 1479(1)


Cruz v. Fernando, Sr., supra

B.

Contract of Option- Arts. 1479, 1324


Sanchez v. Rigos, 145 SCRA 368, June 14, 1972
Equatorial Realty Devt, Inc. v. Mayfair Theater, Inc., 264 SCRA 483,
November 21, 1996

C.

Formalities of Contract of Sale (Statutes of Fraud) - Arts. 1483,


1403, 1625, 1356-1358, 1874; Sec. 22 Act 1147 (Cattle
Registration Act)
Paredes v. Espino, 22 SCRA 1000, March 13, 1968
Inigo v. Maloto, 21 SCRA 246, September 28, 1967
Cuyugan v. Santos, 34 Phil 100, March 3, 1916
Dalion v. Court of Appeals, 182 SCRA 872, February 28, 1990
Yuvienco v. Dacuycuy, 104 SCRA 668, May 27, 1981
Vda. De Jomoc v. Court of Appeals, 200 SCRA 74, August 2, 1991

Santos v. Manalili, 475 SCRA 679, November 22, 2005


Session Seven
IV.

Rights and Obligations of the Vendor - Art. 1495


A.

To transfer ownership
Who can transfer ownership?
General Rule - Arts. 1505-1506, 1547
Cuison v. Remoto, 472 SCRA 274, October 11, 2005
Exceptions: Art. 1505
1.
Estoppel- Arts. 1431, 1433-1434
2.
Sale by an apparent owner
3.
Purchase at Merchants Store, Market or Fair Art.
559
Sun Bros. v. Velasco, 54 O.G. 5143, August 11, 1958
Salonga v. Concepcion, 470 SCRA 291, September 20, 2005
Sigaya v. Mayuga, 467 SCRA 341, August 18, 2005
Premiere Devt Bank v. Court of Appeals, 453 SCRA 630, March
18, 2005
Siy Cong Bieng and Co. v. HSBC, 56 Phil 598 [1932]
Masiclat v. Centeno, May 31, 1956
When/How transfer is effected? - Arts. 1477, 1459, 1496, 1547,
1588
General Rule:
Ilao-Quianay v. Mapile, 474 SCRA 246, October 25, 2005
Exceptions:
1.
sale or return - Art. 1502(1)
2.
sale on approval or trial Art. 1502(2)
3.
conditional sales - Arts. 1478, 1503(1), 1458(2)
Vallarta v. Court of Appeals, 150 SCRA 336, May 29, 1987

Session Eight
Risk of Loss or Deterioration (Total/Partial)- Arts. 1504, 1480,
1493-1494, 1538(1189), 1163, 1174
General Rule: Res perit domino
Exceptions:
1.
Stipulation
2.
Security Title
3.
Delay
Lawyers Cooperative v. Tabora, 13 SCRA 762, April 30, 1965
De Lizardi v. Yaptico, 30 Phil 211, March 22, 1915
Sun Bros. Appliances v. Perez, 7 SCRA 977, April 30, 1963
Double Sales- Art.1544
Rule (Movables/Immovables)
Cuison v. Remoto, supra
Ulep v. Court of Appeals, 472 SCRA 274, October 11, 2005
Sigaya v. Mayuga, supra
Bautista v. Sioson, 39 Phil 615, February 11, 1919
Lichauco v. Berenguer, 39 Phil 643, February 27, 1919
Paylago v. Jarabe, 22 SCRA 1247, March 27, 1968
Quimson v. Rosete, 87 Phil 159, August 9, 1950
When not applicable?
1.
unregistered lands
Carumba v. Court of Appeals, 31 SCRA 558, February 18, 1970
Vda. De Jomoc v. Court of Appeals, supra
Hanopol v. Pilapil, 7 SCRA 452, February 28, 1963
Session Nine
B.

To deliver the object and its accessions - Art. 1537(1164)


Kinds of Delivery of Incorporeal Property (Quasi-tradition) - Arts.
1501, 2095

Kinds of Delivery of Corporeal Property (Tradition) - Art. 1477


1. Actual (Real or Material) - Art. 1497
2. Constructive (Symbolic or Formal)
a.
delivery by the execution of a public instrument- Art.
498(1)
b.
tradition longa manu- Arts. 1498(2), 1499
c.
tradition brevi manu- Art. 1499
d.
tradition constitutum possessorium- Art. 1500
e.
delivery to a common carrier- Arts. 1503, 1523, 1582
f.
when goods are in the possession of a third person- Art.
521(3)
Kuenzle & Streiff v. Macke & Chandler, 14 Phil 610, December 16,
1909
Addison v. Felix, 38 Phil 404, August 3, 1918
Daguilan v. IAC, 168 SCRA 22, November 28, 1988
Pasagui v. Villablanca, 68 SCRA 18, November 10, 1975
Dy, Jr. v. Court of Appeals, 198 SCRA 826, July 8, 1991
Power Commercial and Indl Corp. v. CA, 274 SCRA 597, June 20,
1997
Florendo v. Foz, 20 Phil 388, October 24, 1911
Philippine Suburban Devt. Corp. v. The Auditor General, 63 SCRA
397, April 18, 1975
Board of Liquidators v. Floro, 110 Phil 482, December 29, 1960
Session Ten
Quality/Quantity)- Arts. 1481, 1522, 1539-1543, 1630, 16321633
Rudolf Lietz, Inc. v. Court of Appeals, 478 SCRA 451, December
19, 2005
Santa Ana, Jr. v. Hernandez, 18 SCRA 973, December 17, 1966
Asiain v. Jalandoni, 45 Phil 296, October 23, 1923
Azarraga v. Gay, 52 Phil 599, December 29, 1928
Not bound to deliver when? - Arts. 1524, 1536(1198)
Visayan Distributors, Inc. v. Flores, 92 Phil 145, October 15, 1952
Place of Delivery - f.o.b., c.i.f., f.a.s. )- Arts. 1521(1), 1251,
1582
Behn, Meyer & Co. v. Yangco, 38 Phil 606, September 18, 1918

Bislig Bay Lumber Co. v. CIR, 1 SCRA 156, January 28, 1961
Time of Delivery - Art. 1521(2)
Republic v. Litton & Co., 94 Phil 52, November 28, 1953
Prescription- Art. 1543
C.

Warranties - Arts. 1495, 1567, 1571, 1628, 1629, 1631


1. Express- Art. 1546
Carrascoso, Jr. v. Court of Appeals, supra
Philippine Manufacturing Co. v. Go Joco, 48 Phil 621, January 21,
1926
Distinguished from:
i)
condition)- Art. 1545
ii) dealers talk
iii) false representation
2. Implied warranties
i)
warranty against eviction (warranty of
title) )- Arts. 1548-1559
ii)
warranty against hidden encumbrances or
defects)- Arts. 1560, 1561, 1567-1581, 613,
615
iii)
warranty of quality)- Arts. 1562-1565, 1586,
1599(5)
Guinhawa v. People, 468 SCRA 278, August 25, 2005
Power Commercial and Indl Corp. v. CA, supra
Bautista v. Lasam, 72 Phil 506, June 27, 1941
Mendoza v. Caparros, 94 Phil 317, January 30, 1954

D.

Others)- Arts. 1480, 1163, 1538, 1537, 1164, 1487, 1521 last
par.

Session Eleven
V.

Rights and Obligations of the Vendee


A.

Payment of Price) - Arts. 1582, 1590, 1593


Time and Place

Liability for interest)- Art. 1589


B.

Right of Inspection/Examination)- Arts. 1584, 1481

C.

Right to the fruits- Arts. 1537, 1164

D.

Acceptance- Arts. 1582-1583, 1585-1588, 1593


The Maceda Law (RA 6552) Sale of Immovables on Installment

Ramos v. Heruela, 473 SCRA 79, October 14, 2005


Fabrigas v. San Francisco del Monte, Inc. 476 SCRA 247,
November 25, 2005
VI.

Remedies for Breach of Contract


A.

Remedies of an Unpaid Seller- Arts. 1525-1526


1.
withhold delivery (possessory lien) - Arts.1527-1529, 1535,
2241(3)
2.
stoppage in transitu )- Art. 1530-1532, 1535, 1636(2)
3.
resell the goods- Art. 1533
4.
rescission- Arts. 1534, 1597, 1591-1593, 1191, 1556, 1484,
1532, 1567, 1580
5.
action for the price specific performance- Art. 1595
6.
action for damages- Art. 1596
Katigbak v. Court of Appeals, 4 SCRA 242, January 31, 1962
Song Fo & Co. v. Hawaiian-Phil. Co., 47 Phil 821, September 16,
1925
Weyerhauser Timber Co. v. First Natl Bank of Portland, 38 P2d
48

B.

Remedies of the Buyer- Arts. 1539, 1542-1543, 1567, 1571, 1599


1.
specific performance- Arts. 1598
2.
damages
3.
rescission- Arts. 1481
Recto Law Sale of Movables on Installment- Arts. 1484-1486
Luneta Motor C. v. Salvador, 108 Phil 1037, July 26, 1960
Industrial Finance Corp. v. Ramirez, 77 SCRA 152, May 26, 1977
Northern Motors, Inc. v. Sapinoso, 33 SCRA 1970, May 29, 1970
UMC v. Dy Hian Tat, 28 SCRA 161, May 16, 1969
Cruz v. Filipinas Investment & Finance Corp., 23 SCRA 791, May

27, 1968

Session Twelve
VII.

Extinguishment of Sale
A.

Causes- Arts. 1600, 1231, 1626, 1634-1635

B.

Redemption
1.

Conventional - Art. 1601


Pacto de Retro Sale- Arts. 1607, 1609, 1611-1518, 1676-

1677
Equitable Mortgage- Arts. 1602-1605
Period to Redeem- Art. 1606
Who may exercise the right to redeem? - Arts. 1608, 1610,
1612, 1614-15
Cadungog v. Yap, 469 SCRA 561, September 12, 2005
Salonga v. Concepcion, supra
Go v. Bacaron, 472 SCRA 339, October 11, 2005
Gerardino, Sr. v. CFI Capiz Br. III, 80 SCRA 646, December 29,
1977
Yturralde v. CA, 43 SCRA 315, February 28, 1972
Marquez v. Valencia, 77 Phil 782, December 22, 1946
Quinga v. Court of Appeals, 3SCRA 66, September 19, 1961
Gloria-Diaz v. Court of Appeals, 84 SCRA, July 31, 1978
Heirs of Francisco Parco v. Haw Pia, 45 SCRA 164, May 30, 1972
Session Thirteen
1. Legal- Arts. 1619-1623
Spouses Doromal , Sr. and Salas v. Court of Appeals, supra
Almendrada v. Ngo, 471 SCRA 311, September 30, 2005
Aguilar v. Aguilar, 478 SCRA 187, December 16, 2005
Villasor v. Medel, 81 Phil 546, September 29, 1948
Ortega v. Orcine, 38 SCRA 276, March 31, 1971
Session Fourteen

FINAL EXAMINATIONS (by agreement of the class)

RMP/ Thanks to Prof. CAUribe