Topics: Contract, Contract law, Sales Pages: 14 (3533 words) Published: January 12, 2013
Chapter 1
Nature and From of The Contract

Art. 1458: By the contract of sale one of the contracting parties obliges himself to transfer the ownership of and to deliver a determinate thing, and the other to pay therefore a price certain in money or its equivalent. -------------------------------------------------

A contract of sale may be absolute or conditional.

1) SALE is a contract where one party obligates himself to transfer the ownership of a determinate thing, while the other party obligates himself to pay for said thing a price certain in money or its equivalent. 2) Roman law – avenditio

French/ Spanish – venta
Definition was taken under Art. 1445 of the Spanish Civil Code wherein the only difference is that the seller need not to be the owner of the determinate thing or the thing which is due. 3) Essential Characteristics of the Contract of Sale:

a) Consensual – contract is perfected by mere consent.
b) Bilateral Reciprocal- bound by the obligations dependent upon each other. c) Onerous- to acquire rights, valuable consideration must be given. d) Commutative- values exchanged are almost equivalent to each other. e) Principal- for a contract of sale to validly exist, it is not necessary for it to depend on another contract. f) Nominate- the Code refers to it by a special designation or name. 4) Elements of the Contract of Sale:

a) Essential (w/o w/c there can be no valid sale):
1) Consent or meeting of the minds
2) Determinate subject matter
3) Price certain in money or its equivalent
e.g. Aguinaldo v. Esteban
Leabres v. CA
b) Natural (w/c are inherent in the contract):
1) Warranty against (deprivation of the property bought)
2) Warranty against hidden defects
c) Accidental (w/c may be present or absent in the stipulation e.g. place, time, or presence of conditions) 5) Stages in the Contract of Sale:
a) Generation or negotiation
b) Perfection- meeting of the minds
c) Consummation- when the object is delivered and the price is paid 6) Kinds of Sale:
a) As to the nature of the subject matter:
1) Sale of real property
2) Sale of personal property
b) As to the value of the things exchanged:
1) Commutative sale
2) Aleatory sale
c) As to whether the object is tangible or intangible:
1) Sale of property (tangible or corporeal)
2) Sale of right (assignment of a right or credit, or some other intangibles such as copyright, a trademark or goodwill) Note:
Tangible – Chose in possession; Intangible- Chose in action d) As to the validity or defect of the transaction:
1) Valid sale
2) Recissible sale
3) Voidable sale
4) Unenforceable sale
5) Void sale
e) As to the legality of object:
1) Sale of a licit object
2) Sale of an illicit object
f) As to the presence or absence of conditions:
1) Absolute sale (no condition)
2) Conditional sale (pacto de retro)
g) As to whether wholesale or retail
1) Wholesale, if to be resold for a profit the goods being unaltered when resold, the quantity being large. 2) Retail, if otherwise
h) As to the proximate inducement for the sale:
1) Sale by description
2) Sale by sample
3) Sale by description and sample
i) As to when the price is tendered:
1) Cash sale
2) Sale on installment plan
7) Sale distinguished from Dation in Payment

1) There is no pre-existing credit. 2) Gives rise to obligations. 3) The cause or consideration here is the price, from the viewpoint of the seller; or the obtaining of the object, from the viewpoint of the buyer. 4) There is greater freedom in the determination of the price. 5) The giving of the price may generally end the obligation of the buyer. | 1) There is a pre-existing...
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