SALES CASE DIGESTS

ADDITIONAL CASES:
1) NATIONAL GRAINS AUTHORITY v. IAC
TOPIC: CONTRACT OF SALE; PERFECTION

FACTS:
In this case, plantiff Soriano offered to sell “palay” grains to NFA, though its
Provincial Manager, Cabal defendant. Thereafter, the plaintiff submitted documents
required by NFA for pre-qualifying as a seller. Accordingly, the plaintiff was given a
quota of 2460 cavans of “palay” placed in the Farmer’s Information Sheet, which he
submitted. Consequently, the plaintiff delivered 630 cavans of palay to NFA and
upon demand of payment, the defendant informed the former to withdraw from the
NFA warehouse the 630 cavans of “palay” because he is not a bona fide farmer,
hence, they cannot legally accept the delivered goods. Thus, the plaintiff filed an
action for specific performance.

RTC’s RULING: Ordered NFA to pay the plaintiff

CA’s RULING: Affirmed the lower court’s decision in toto.

Appellant’s Contention: That the 630 cavans was a mere offer, hence policitation

ISSUES:
1) Whether or not there was a meeting of the minds between the plaintiff and
the defendant.
2) Whether or not consent is present in this case.

HELD:
1) Yes, Art. 1458 of the Civil Code provides “By the contract of sale, one of the
contracting parties obligates himself to transfer the ownership of and to
deliver a determinate thing, and the other to pay therefor a price certain on
money or its equivalent.” On the other hand, a Contract is a meeting of minds
between two persons whereby one binds himself with respect to the other to
give something or to render some service. (Art. 1305 NCC). The essential
requisites of a contract are 1) consent of the contracting paties; 2) object
certain which is the subject matter of the contract; and 3) cause of the
obligation which is established.

In this case, Soriano initially offered to sell grains of palay to NFA. When the
latter accepted the offer by noting in Soriano’s Farmer’s Information Sheet a quota
of 2460 cavans, the was already meeting of the minds.

2) Yes, the petitioner’s contention that there is no contract of sale because one
of the elements particularly consent is lacking, is not correct. Sale is a
consensual contract. Art. 1475 provides “The contract of sale is perfected
from the moment there is meeting of the minds upon the thing which is the
object of the contract and upon the price.” Further, Art. 1475 (2) states that
“From that moment, the parties may reciprocally demand performance,
subject to the provisions of the law governing the form of contracts.

NOTE: The is perfection when there is consent upon the subject matter and the
price even if neither is delivered.

2) JOHANNES SCHUBACK v. CA
TOPIC: PERFECTION

FACTS:
In 1981, defendant San Jose communicated his intention to purchase bus
spare parts to plaintiff Johannes. On December 18, the item number, unit price and
total price to the defendant. On December 24, the defendant informed the plaintiff
his desire to avail of the prices of the parts and simultaneously enclosed its purchase
order. On December 29, the defendant personally submitted the quantities he
wanted to the General Manager of the plaintiff. In the purchase order submitted, the
defendant noted above his signature “Above P.O will include a 3% discount. The
above will serve as our initial P.O.” Hence, the plaintiff immediately ordered the
needed items by the defendant from Schuback, Germany. However, the defendant
later declared that no valid purchase was made.

ISSUE: Whether or not a contract of sale was perfected.

HELD:
Yes, Art. 1475. In this case, when the defendant informed the plaintiff his desire to
avail of the prices of the parts and simultaneously enclosed its purchase order a
meeting of minds between the vendor and the vendee has already occurred.

YU TEK & CO. v. GONZALES

TOPIC: ELEMENTS OF A CONTRACT OF SALE

MAIN CASES
1) CORONEL V. CA
TOPIC: CONDITIONAL CONTRACT TO SELL DISTINGUISHED FROM CONTRACT
TO SELL

FACTS:
In this case, a document entitled “RECEIPT OF DOWNPAYMENT” was excuted
by petitioner Coronel in favor of Alcaraz, wherein it imposed conditions, viz:
1) Alcaraz will make a down payment of P50,000
2) The Coronels will transfer the title in their names the property registered in
the name of their deceased father upon the receipt of P50,000
3) Upon the transfer in their names of the subject property, a deed of absolute
sale shall be executed in favor of Alcaraz provided that the latter will pay the
whole balance.

On February 6, the title of the estate of the decedent was transferred to defendant
Coronel.

GOMEZ v. CA
ROMERO v. CA
VELARDE v. CA
TOPIC: DEED OF SALE; RESCISSION

FACTS:
In this case, David Raymundo, a registered owner of a parcel of land sold the
said land to Spouses Velarde. Consequently, the former executed a Deed of Sale with
Assumption of Mortgage in favor of the spouses subject to the condition that the
latter will pay the loan to BPI in the amount of P1.8M.
ISSUE: Whether or not a deed of sale constitutes transfer of ownership.
HELD:
Yes

COMMISSIONER OF INTERNAL REVENUE V. ENGINEERING EQUIPMENT AND

SUPPLY COMPANY AND COURT OF TAX APPEALS
TOPIC: Contract of Sale v. Contract of Piece of Work

FACTS:
In this case, Engineering Equipment and Supply Company, is a domestic
corporation engaged in the design and installation of central type air conditioning
system. Sometime in 1956, one Juan Dela Cruz wrote to the Commissioner of
Internal Revenue denouncing Engineering for tax evasion by misdeclaring its
imported articles. Acting on these denunciations, the BIR together with the NBI and
CB seized the said articles. Upon recommendation by the revenue examiners, the
BIR assessed Engineering in the amount of P480k for deficiency advanced sales tax.
Thereafter, the Court of Tax Appeals rendered a decision exempting Engineering
from deficiency manufacturers sales tax. Hence, this petition.

ISSUE: Whether or not herein respondent is liable for advanced sales tax pursuant
to Sec. 185(m) of the Tax Code.

HELD:

No, in this case the Court distinguished a Contract of Sale and a Contract of Piece
of Work under Art. 1467 of the Civil Code in order to arrive at a conclusion
whether Engineering is liable for advanced sales tax.

Art. 1467. A contract for the delivery at a certain price of an article which the
vendor in the ordinary course of his business manufactures or procures for the
general market, whether the same is on hand at the time or not, is a contract of sale,
but id the goods are to be manufactured specially for the customer and upon his
order, and not for the general market, it is a contract for a piece of work.

In this case, Engineering did not manufacture air conditioning units for sale to the
public. Hence, Engineering is not liable to advanced sales tax pursuant to Sec. 185 of
the Tax Code thereof.

QUIROGA V. PARSONS

TOPICS: Contract of Sale v. Contract of Agency and Interpretation of Contracts

FACTS:

In this case, Quiroga (petitioner) and Parsons (defendant) entered into a

Contract wherein Quiroga authorized Parsons

PHILIPPINE LAWIN BUS CO. v. CA

TOPIC: Dation in Payment (Dacion en pago)

FACTS:
In this case,