CHAPTER 1: INTRODUCTIONCONTRACTOFSALEOneof thecontractingpartiesobligateshimself totransfertheownershipof andtodeliver a determinate thing and the other to pa!therefor a price certain in mone! or its e"#ivalent$ Acontract of sale ma! be absol#te or conditional$SALES%$ Contract of sale &absol#te' real obligation obligation to give remedies available(a$ specific performanceb$ rescissionc$ damages)$ Contract to sell &conditional' personal obligation obligation to do remedies available(a$ resol#tionb$ damagesESSENT*AL RE+,*S*TES OF A CONTRACT OF SALE%$ consent)$ s#b-ect matter.$ priceC/ARACTER*ST*CS OF CONTRACT OF SALE(%$ Nominate 0 law gave it a name)$ 1rincipal 0can stand on its own2 #nli3e accessor!contract.$ 4ilateral 0 imposes obligation on both partiesa$ obligation of seller transfer ownership 5deliverb$ obligation of b#!er pa! priceConse"#ence( power to rescind is implied inbilateral contracts6$ Onero#s with val#able consideration Conse"#ence( all do#bts in constr#ingcontract to be resolved in greater reciprocit! ofinterest7$ Comm#tative e"#al val#e is e8changed for e"#alval#e Test(s#b-ective as long as parties believe inall honest!that heisreceivinge"#al val#ethen it complies with the test 5 wo#ld not bedeemed a donation2 b#t m#st not be abs#rd$ *nade"#ac! of price or aleator! character nots#fficient gro#ndtocancel contract of sale2inade"#ac!canshowvitiationof consent 5sale ma! be ann#lled based on vice b#t not oninade"#ac!9$ Consens#al meeting ofminds ma3es aperfectcontract of sale b#t needs deliver! to cons#mmate$:$ Title 5 not a mode title gives rise to an obligationto transfer2 it is amode w;c act#all! transfersownershipSTA#st be real)$ >#st be in mone! or its e"#ivalent.$ >#st be certain or ascertainable at the time ofthe perfection of the contract6$ >anner of pa!ment provided forREAL%$ Ehen price stated is one intended b! the parties *f fictitio#s( no intention with respect to price 0CO*= *f False;sim#lated( what appears in contract isnot the tr#e pricea$ CAL*= if there is tr#e considerationb$ CO*= b#t if none &beca#se it is fictitio#s')$ Cal#able Ehen not val#able CO*= Ehen contract is onero#s pres#med to haveval#able consideration Nominal consideration w;c is common lawconcept does not appl! &1%$GG' delivered 4,DERm#stpa! reasonable price therefore co#rt can fi8price>ANNER OF 1AD>ENT >,ST 4E A OF SALES%$ Form not important in validit! of sale Sale being consens#al ma! be oral or writtenperfected b! mere consent as to price 5s#b-ect matter *f partic#lar form is re"#ired #nder the stat#teof fra#ds(a$ valid 5 binding between partiesb$ not binding to .rd persons onl! Reason( p#rposes of convenienceonl! 5 notfor validit! 5 enforceabilit!2 ca#se of action isgranted to s#e 5 compel other part! toe8ec#te the doc#ment)$ Ehenform is important for validit!2 e8ceptionb!specific provision of law2a$ power tosell apieceof landgrantedtoanagent otherwise CO*=b$ saleof largecattle2 m#st alsoberegisteredwith >#nicipal treas#rer otherwise CO*=c$ sale ofland b! non0Christianifnotapprovedb! >OCA4LE First to register in good faith No inscription first to possess in good faith No inscription 5 no possession in good faith 1erson who presents oldest title in good faithE=*ES OF ,N1A*= SELLER An! man ma! not ta3e law in his own hands m#stsee3 remed! thro#gh co#rts E8ception(%$ =OCTR*NE OF SELF /EL1)$ S1EC*AL RE>E=*ES Re"#isites(%$ S#b-ect matter goods )$ Seller is #npaid not completel! paid orreceived negotiable instr#ment #nder acondition5conditionhasbeenbreachedb!reason of dishonor.$ 1h!sical possession is with seller%$ possessor! lien)$ stoppage in transitu .$ special right of re0sale6$special right to rescind1OSSESSORD L*EN Sellernot bo#ndtodeliverif b#!erhasnot paidhim the price Right to retain2 cannot be availed when seller doesnot have c#stod! E8ercisable onl! in following circ#mstances(a$ goods sold witho#t stip#lation as to creditb$ goodssoldoncredit b#t termof credit hase8piredc$ b#!er becomes insolvent Ehenpart of goodsdelivered ma!still e8erciseright on goods #ndelivered *nstances when possessor! lien lost(a$ seller delivers goods to carrier for transmissionto b#!er witho#t reserving ownership in goodsor right to possess themb$ b#!er or his agent lawf#ll!obtains possessionof goodsc$ waiver loses lien when he parts with goods &still hasstoppage in transitu' notice b! seller to b#!er not essentialSTO11AANCE *f alread! chose specific performance can nolonger choose other remedies E8cept( after choosing it has become impossiblerescission ma! be p#rs#edRESC*SS*ON Ehenchosen there is correlative obligation torestit#te 4#tstip#lation that installments paid are forfeitedare valid if not #nconscionable =eemed chosen when(a$ Notice of rescission is sentb$ Ta3es possession of s#b-ect matter of salec$ Files action for rescission 4arring effect on recover! of balanceFORECLOS,RE 4arring effect on recover!of balance E8tent of barring effect(p#rchase price E8ception( mortgagorref#ses to deliver propert!to effect foreclos#rerecover also e8pensesinc#rred in attorne!s feesetc$ &1erverse 4#!er0>ortgagor'*>>OCA4LES &*N aceda Law applies to COS 5 CTS 5 Financing>ACE=A LAE Coverage( REALESTATEdefined space vs$CON=O not defined space &w; common areas'%$ contract of sale)$ contract to sell.$ financing transactions E8cl#ded(%$ ind#strial)$ commercial.$ sale to tenants #nder agrarian laws R*1T*ON >A=E(%$ -#rispr#dence before the NCC( b#!er a retroa#tomaticall! ac"#ires f#ll ownership)$ #nder present art %9G:( there m#st be -#dicialorder before ownership of real propert! isconsolidated in the b#!er a retro/OE *S RE=E>1T*ON EFFECTE=(%$ Seller a retro m#st first pa! the following(a$ the price of the thing soldb$ e8penses of the contract and otherlegitimatepa!mentsmadeb!reasonof thesalec$ necessar! and #sef#l e8penses madeon the thing sold)$ Calid tender of pa!ment is s#fficient.$ >ere sending of notice witho#t valid tender isins#fficient6$ Fail#re to pa! #sef#l 5#nnecessar! e8pensesentitles vendee to retain land #nless act#alreimb#rsement is made*N CASE OF >,LT*01ART*ES%$ Ehen an #ndivided thing is sold beca#se co0owners cannot agree that it be allotted to one ofthem vendee a retro ma! compel the vendor toredeem the whole thing)$ Ehen an #ndivided thing is sold b! co0owners ; co0heirs vendors a retro ma! onl! e8ercise his rightover his respective share2 vendeearetroma!demand that the! m#st come to an agreement firstand ma! not be compelled to consent to a partialredemption.$ Ehen rights of co0owners over an #ndivided thingissoldasregardstotheir ownsharevendeeretro cannot compel one to redeemthe wholepropert!6$ Sho#ld one of the co0heirs;co0owners s#cceed inredeeming the propert! s#ch vendor a retro shallbe considered as tr#stee with respect to the shareof the other co0owners;co0heirs$FR,*TS%$ what controls is the stip#lation between parties asregards the fr#its2 if none( a' at time of e8ec#tion of the sale a retrotherearevisibleor growingfr#itsthere shall be no pro0rating at time ofredemptionif noindemnit!waspaidb! the vendee a retrob' at time of e8ec#tion sale a retro therebe no fr#its b#t there are fr#its at timeof redemption pro0rated betweenvendor a retro 5 vendee a retro givingthe vendee a retro a partcorresponding to the time hepossessed the land$LE-AL REDEMPTION right to be s#brogated #pon the same terms andconditions stip#lated in the contract in the place ofonewhoac"#iresthethingb!p#rchaseor b!dation in pa!ment or b! other transaction whereb!ownership is transmitted b! onero#s title$%$ among co0heirs an!of theheirssell hishereditar!rightstostranger before partition an! of the co0heirs ma! be s#brogated to therights of the p#rchaser b! redeeming saidhereditar!right( reimb#rseb#!er ofthepriceof the sale co0heirs has % month from receipt of notice inwriting)$ among co0owners an! or all of co0owners sells their shares to .rdperson an! co0owner ma! e8ercise right ofredemption b! pa!ing reasonable price ofpropert! to the b#!er if ) or more co0owners desire to e8ercise rightof redemption the! ma! onl! do so inproportion to the share the! respectivel! havein thing owned in common=*ST*NCT*ON4ETEEENR*1T*ONOFCO0/E*RS FRO> CO0OENERS.$ among ad-oining ownersa$ r#ral land where piece of r#ral land has an area note8ceeding % hectare ad-oining owner hasright toredeem#nlessgranteedoesnotown a r#ral land if ) or more ad-acent lot owners desire toe8ercise right to redeem owner ofad-oininglot with smaller area shall bepreferred%7CO0/E*RS CO0OENERS/eir ma! redeem forhimself alone thehereditar! right sold b! aco0heirCo0owner ma! redeempropert! b#t even if #seshisownf#nds redemptionin#res to the benefit ofother co0ownersSale of hereditar! right&%G??' over no partic#larob-ectSale of interest in partic#larpropert! if ) or more ad-acent lit owners desire toe8ercise right to redeem5 both havesamelot area onewhofirst re"#estedshall be grantedb$ #rban land when pieceofland issmall 5cannotbe#sedforan!practical p#rpose5bo#ghtmerel! for spec#lation owner of ad-oiningland can redeem ) or more owners of ad-oining lot desire toe8ercise right to redeem owner whoseintended #se is best -#stified shall bepreferred$c$ sale of credit in litigation when a credit or otherincorporeal right inlitigation is sold debtorshall have a right toe8ting#ish it b!reimb#rsingtheassigneefor the price the latter paidtherefor pl#s -#dicialcosts interest debtor ma! e8ercise right within .G da!s from thedate assignee demands pa!ment from himE/EN 1ER*O= OF RE=E>1T*ON 4E