SALES & LEASE Art.

1458-1478
Art. 1458.
By contract of sale on 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 in money or its equivalent.
A contract of sale may be absolute or conditional.
Concept of contract of sales
Contract of sale
agreement whereby one of the parties (seller/vendor) obligates himself to the
other (buyer/purchaser/vendee) who, on his part, binds himself to pay therefor
a sum of money or its equivalent
Characteristics of a contract of sale CBOCNP
Consensual
o perfected by mere consent without any further act
Bilateral
o both contracting parties are bound to fulfill correlative obligations
towards each other
o the seller: deliver and transfer ownership of the sold
o buyer: pay the price
Onerous
o thing sold is conveyed in consideration of the price and vice versa
Commutative
o thing sold is considered the equivalent of the price paid and vice versa
o contract may be aleatory (sale of a hope)
Nominate
o given a special name or designation sale
Principal
o does not depend for its existence and validity upon another contract
Essential requisites of a contract of sale
Consent or meeting of minds
o consent on the part of the seller to transfer and deliver and on the
part of the buyer to pay
o parties must have legal capacity to give consent and to obligate
themselves
o essence: conformity of the parties on the terms of the contract, the
acceptance by one of the offers made by the other
o contract to sell: bilateral contract
o 3 different kinds of sale
ordinary execution sale
judicial foreclosure sale
extra-judicial foreclosure sale
Object or subject matter
o Refers to the determinate thing which is the object of the contract
Thing must be determinate or at least capable of being made

determinate
No meeting of minds if buyer and seller differ in regard
o May be personal or real property
Cause or consideration
o Price certain in money or its equivalent
o Does not include goods or merchandise although they have their own value
in money
o Price must be real, not fictitious
Otherwise, sale is void
Natural and accidental elements
Natural
o Deemed to exist in certain contacts in the absence of any contract
stipulations
Warranty against eviction
Hidden defects
Accidental
o May be present or absent depending on the stipulations of the parties
Conditions
Interest penalty
Time
Place of payment
Effect of absence of price/nonpayment of price
1. There can be no sale without a price
a. Contract of sale is void and produces no effect where the same is without
cause or consideration
b. Where the figures referred to by the buyer as prices are mere estimates
i. Transaction lacks and essential requisite for the perfection of the
contract of sale
2. Non-payment of purchase
a. Resolutory condition
i. Remedy is either recission or specific performance
Transfer of title to property for a price, essence of sale
1. Obligations to deliver and to pay
a. Essence of the sale: transfer of title for a price actually paid or promised
b. Neither is the delivery of the thing nor the payment of the price necessary
for the perfection of the contract of sale
i. Perfected by mere consent
2. Where transfer of ownership not intended by the parties
a. Illegal
b. futures- the parties merely gamble on the rise or fall in prices and is
declared null and void by law
Kinds of Contract of Sale
As to presence or absence of conditions
o Absolute: not subject to any condition
Title passes to the buyer upon delivery of the thing sold
Payment of purchase price is not essential to the transfer of ownership

 As long as the property sold has been delivered

o Conditional: contemplates a contingency
Contract is subject to certain conditions
Other kinds

Contract to sell
Bilateral contract whereby the prospective seller, while expressly reserving
the ownership of the subject property despite delivery thereof to the
perspective buyer, binds himself to sell the said property exclusively to the
prospective buyer upon fulfillment of the condition agreed upon, that is, full
payment of the purchase price\
Transfer of title to the buyer
Upon the fulfillment of the suspensive condition, ownership will not
automatically transfer to the buyer although the property may have been
previously delivered to him
Prospective seller still has to convey title to the prospective buyer by entering
into a contract of absolute sale to consummate the transaction
Sale of subject property to a third person
Contract to sell
o A third person buying such property despite the fulfillment of the suspensive
condition, cannot be deemed a buyer in bad faith and the prospective buyer
cannot seek relief of the conveyance of the property
Conditional contract of sale
o Upon the fulfillment of the suspensive condition, the sale becomes absolute
and this will affect the sellers title thereto
o If there had been delivery of the subject property, the sellers ownership is
automatically transferred to the buyer
Seller will no longer have any title to transfer to any third person
Art. 1459. The thing must be licit and the vendor must have a right to transfer ownership
thereof at the time it is delivered
Requisites concerning object
Things
o Determinate
o Licit/lawful
o Not impossible
Rights which are not intransmissible or personal may also be the object of sale
Kinds of illicit things
Illicit per se (nature)
Per accidens (because of some provisions of law)
Right to transfer ownership
Seller must be owner or authorized by owner of the thing sold

o One cannot transmit or dispose of that which he does not have

Right must exist at the time of delivery
o Seller is deemed only to impliedly warrant that he has the right to transfer
the ownership thereof at the time it is delivered
Where property sold registered in name of seller who employed fraud in securing
his title