As mentioned, the elements of a price are:
filed a case against respondents
1. Price must be real, not simulated.
2. It must be in money or its equivalent
3. It must be certain or ascertainable at the perfection.
4. Manner of payment: which must be agreed upon.
1. Price must be real:
Article 1471. If the price is simulated, the sale is
void, but the act may be shown to have been in
reality a donation, or some other act or contract.
Do take note, however, of the 2 kinds of simulation.
Absolutely simulated and relatively simulated contracts.
When the price if considered false, we have to
distinguish it if whether it is false because the real price
is not expressed in the contract, then the parties will
nevertheless be bound by their true agreement, but when
you say it is false because there is no meeting of the
minds as to the price or consideration, then there is no
valid contract at all.
Non-payment of price does not affect validity of
contract. You have to distinguish between absence of
consideration from failure of consideration. When you
say absence of consideration,
no valid contract of sale. Failure of consideration or non-
payment of price, goes not into perfection but the
consummation of the contract of sale.
Now the second element for a valid price is that it must
be in money or its equivalent. In the case of Inchausti,
the word sum signifies an amount or figure in terms of
money that must be paid as a result of the sales
transaction. So, equivalent to the thing sold. Its very
clear under Article 1458 that the price must be in money
or its equivalent.
What happened in the case of Bagnas?
ISAAC BAGNAS ET AL. vs. CA
G.R. No. L-38498, August 10, 1989
FACTS:
Hilario Mateum died without a will and was
survived only by collateral relatives. Bagnas et al., the
petitioners, were his nearest kin. The respondents
Retonil et al. on the other hand were relatives to a farther
extent.
Retonil et al. claims ownership of 10 parcels of
land from the estate of Hilarion which they contend were
sold by Hilario through two deeds of sale where the
consideration for the lands was one (1.00) Peso and
services rendered, being rendered and to be rendered.
Bagnas et al.
seeking annulment of the deeds of sale as fictitious,
fraudulent or falsified, or alternatively, as donations void
for want of acceptance embodied in a public instrument.
In answer to the complaint, the respondents denied the
alleged fictitious or fraudulent character of the sales in
their favor, asserting that the said sales were made for
good and valuable consideration.
ISSUE: W/N the said consideration is valid.
HELD:
The Court ruled that the deeds of sale are void
and are of no force and effect.
Upon the consideration alone that the apparent
gross, not to say enormous, disproportion between the
stipulated price (in each deed) of P l.00 plus unspecified
and unquantified services and the undisputably valuable
real estate allegedly sold worth at least P10,500.00 going
only by assessments for tax purposes which, it is well-
known, are notoriously low indicators of actual value
plainly and unquestionably demonstrates that they state a
false and fictitious consideration, and no other true and
lawful cause having been shown, the Court finds both
said deeds, insofar as they purport to be sales, not merely
voidable, but void ab initio.
The transfers in question being void, it follows
as a necessary consequence that the properties
purportedly conveyed remained part of the estate of
Hilario Mateum, said transfers notwithstanding,
recoverable by his intestate heirs, the petitioners herein,
whose status as such is not challenged.
Even if the contract of sale would be shown as
a donation (apparently, this was the intent of the donor),
failure to conform to the requirements would not make it
a valid donation.
There is no Contract of Sale for lack of
consideration. Likewise, there is also no valid deed of
donation for failure to conform to the requirements of
donation.
----
Q: Do we have a consideration?
A: Yes
Q: Was that a valid consideration?
A: The SC said no, maam.
Q: Isnt it that P1 and services rendered would be
considered as money and its equivalent as provided in
1458?
A: Court considered it as indeterminable and so could
not be considered as valid consideration. Services were
also not considered as equivalent in money.
So what do we have here? The consideration written in
the contract is P1.00 and services rendered. And what is
the ruling of the Supreme Court?
xxx. The Deeds of Sale are VOID or have no force
or effect. Upon the consideration alone that the
apparent gross, not to say enormous, disproportion
between the stipulated price (in each deed) of P
1.00 plus unspecified and unquantified services
and the undisputably valuable real estate allegedly
sold worth at least P10,500.00 going only by
assessments for tax purposes which, it is well-
known, are notoriously low indicators of actual
value plainly and unquestionably demonstrates
that they state a false and fictitious
consideration, and no other true and lawful cause
having been shown, the Court finds both said
deeds, insofar as they purport to be sales, not
merely voidable, but void ab initio. xxx
There was an indication that the consideration evidence
presented was simulated, false and fictitious. Moreover
the SC held here that the services were not treated as an
equivalent of monetary value.
What do we mean by mere nominal price? There was no
intention of the parties to pay any indicated valuable
consideration. Non-performance of service will not
affect validity since service is not equivalent to money.
Q: Was is the consideration for the case of Ong?
A:The consideration is also 1 peso and other valuable
considerations.
Q: Was it a valid consideration for the sale?
Q: Yes maam, the SC said it is a valid consideration.
So what happened in this case?
2. It must be in money or its equivalent
MELDA ONG, ET AL. vs ALFREDO ON ET AL.
G.R. No. L-67888, October 8, 1985
FACTS:
On February 25, 1976, Imelda Ong for and in
consideration of One (1.00) Peso and other valuable
considerations, executed in favor of Sandra Maruzzo,
then a minor, a Quitclaim Deed whereby she transferred,
released, and assigned all her rights and title over a
parcel of land in Makati.
However, on November 19, 1980, Imelda Ong revoked
the aforesaid Quitclaim and donated the property to her
son Rex.
Subsequently, Sandra Maruzzo on June 20, 1983,
through here guardian ad litem Alfredo Ong, filed with
the RTC an action for the recovery of
ownership/possession and nullification of the Deed of
Donation in favor of Rex.
Petitioners claimed that the Quitclaim Deed is null and
void inasmuch as it is equivalent to a Deed of Donation,
acceptance of which by the donee is necessary to give it
validity. Further, it is averred that the donee, Sandra
Maruzzo, being a minor, had no legal personality and
therefore incapable of accepting the donation.
The trial court ruled in favor of Maruzzo and held that
the Quitclaim Deed is equivalent to a Deed of Sale and,
hence, there was a valid conveyance in favor of the
latter.
Appealing to the IAC, petitioners additionally contends
that the One (1.00) Peso consideration is not a
consideration at all to sustain the ruling that the
Quitclaim Deed is equivalent to a sale. The IAC
however affirmed the TC.
ISSUE: W/N the quitclaim is equivalent to a deed of
sale or to a deed of donation
HELD:
The Quitclaim Deed is equivalent to a deed of sale. A
careful perusal of the subject deed reveals that the
conveyance of the one- half () undivided portion of the
above-described property was for and in consideration of
the One (P 1.00) Peso and the other valuable
considerations (emphasis supplied) paid by private
respondent Sandra Maruzzo through her representative,
Alfredo Ong, to petitioner Imelda Ong. Stated
differently, the cause or consideration is not the One
(P1.00) Peso alone but also the other valuable
considerations.
Although the cause is not stated in the contract it is
presumed that it is existing
xx
Nisingit si Atty. Sarona
Q: SO that refers to what kind of presumption?
A: Disputable presumption.
Q: How can it be disputed?
A: If the debtor proves the contrary. (Article 1354)
Q: In the case was there proof that such consideration
did not exist?
A: None, maam
xx
. unless the debtor proves the contrary (Article 1354
of the Civil Code). One of the disputable presumptions is
that there is a sufficient cause of the contract. It is a legal
presumption of sufficient cause or consideration
supporting a contract even if such cause is not stated
therein (Article 1354, New Civil Code of the
Philippines.) This presumption cannot be overcome by a
simple assertion of lack of consideration especially when
the contract itself states that consideration was given,
and the same has been reduced into a public instrument
with all due formalities and solemnities. To overcome
the presumption of consideration the alleged lack of
consideration must be shown by preponderance of
evidence in a proper action.
The execution of a deed purporting to convey ownership
of a realty is in itself prima facie evidence of the
existence of a valuable consideration, the party alleging
lack of consideration has the burden of proving such
allegation.
Even granting that the Quitclaim deed in question is a
donation, Article 741 of the Civil Code provides that the
requirement of the acceptance of the donation in favor of
minor by parents of legal representatives applies only to
onerous and conditional donations where the donation
may have to assume certain charges or burdens.
Donation to an incapacitated donee does not need the
acceptance by the lawful representative if said donation
does not contain any condition. In simple and pure
donation, the formal acceptance is not important for the
donor requires no right to be protected and the donee
neither undertakes to do anything nor assumes any
obligation. The Quitclaim now in question does not
impose any condition.
----
In the case of Bagnas, aside from the fact that the
consideration was 1 peso and other services rendered,
there was really no evidence that the parties really
entered into a contract of sale. Here in Ong, there was no
proof shown that there was no intention and therefore
the presumption of existence of a consideration is
applicable.
Dito, no evidence was shown that the consideration
stated was not paid or that it was simulated and therefore
it is presumed to exist.
Also recall what we have discussed in Polytechnic.
Again, anong consideration dun? Cancellation of the
liabilities of the seller to the buyer.
Now we also have the case of Republic. What happened
in this case?
REPUBLIC vs PRDC and CA
G.R. No. L-10141, January 31, 1958
FACTS:
The Republic brought an action against Apostol for the
collection of sums owing to it for his purchase of
Palawan Almaciga and other logs. His total debt
amounted to some P34,000. PRDC intervened claiming
that Apostol, as President of the company, without prior
authority, took goods (steel sheets, pipes, bars, etc) from
PRDC warehouse and appropriated them to settle his
personal debts in favor of the government. The Republic
opposed the intervention of PRDC, arguing that price is
always paid in money and that payment in kind is no
payment at all; hence, money and not the goods of
PRDC are under dispute.
ISSUE: W/N payment in kind is equivalent to price
paid in money.
HELD:
Yes. The Government argues that "Price . . . is always
paid in terms of money and the supposed payment being
in kind, it is no payment at all, "citing Article 1458 of the
new Civil Code.
However, the same Article provides that the purchaser
may pay "a price certain in money or its equivalent,"
which means that they meant of the price need not be in
money. Whether the G.I. sheets, black sheets, M. S.
Plates, round bars and G. I. pipes claimed by the
respondent corporation to belong to it and delivered to
the Bureau of Prison by Macario Apostol in payment of
his account is sufficient payment therefore, is for the
court to pass upon and decide after hearing all the parties
in the case. Should the trial court hold that it is as to
credit Apostol with the value or price of the materials
delivered by him, certainly the herein respondent
corporation would be affected adversely if its claim of
ownership of such sheets, plates, bars and pipes is true.
----
Why is it important to determine whether there is valid
consideration? Here, the argument of the government
was that the price should always be paid in money and if
it is in kind, theres no payment at all. However, Article
1458 is clear, that consideration can be in money or its
equivalent. So it was important to determine whether
these construction materials were delivered in payment
because whether the G.I. sheets, blacksheets, M. S.
Plates, round bars and G. I. pipes claimed by the
respondent corporation to belong to it and delivered to
the Bureau of Prison by Macario Apostol in payment of
his account is sufficient payment therefore, is for the
court to pass upon and decide after hearing all the
parties in the case.
Should the trial court hold that it is as to credit Apostol
with the value or price of the materials delivered by him,
certainly the herein respondent corporation would be
affected adversely if its claim of ownership of such
sheets, plates, bars and pipes is true.
What falls within the term Equivalent?
Pwede sya in kind. So its also possible, so lets say the
seller sells a car for 250K and the buyer gives 100K plus
parcel of land. The land will be considered as a valid
price.
Cancellation of debt, as in the case of Polytechnic, is
also a valid consideration. Even if we say cancellation
would result to dacion en pago, we still go back to sales,
because it is the law of sales that governs dacion en
pago.
And then, If for example, the price would be paid from
the profits of a business, that would still be considered as
a valid price. if there are no profits from the business,
than that would not affect validity of sale since the profit
affects the consummation and not the perfection of the
sale.
That is the case of Bagnas, wherein there is no Contract
of Sale. At the very least what you have is Labor,
Contract of Services. (I pay that you may do. Do ut
facias)
Now another requisite for a valid price that we
mentioned before is that the price must be certain or
ascertainable at perfection.
Its very easy to say whether or not a price is certain or
not. When we say its certain, it is in terms of money or
pesos and centavos. But ascertainable, we also have that
as provided under Article 1469.
Article 1469. In order that the price may be
considered certain, it shall be sufficient that it be so
with reference to another thing certain, or that the
determination thereof be left to the judgment of a
special person or persons.
Should such person or persons be unable or
unwilling to fix it, the contract shall be
inefficacious, unless the parties subsequently agree
upon the price.
If the third person or persons acted in bad faith or
by mistake, the courts may fix the price.
Where such third person or persons are prevented
from fixing the price or terms by fault of the seller
or the buyer, the party not in fault may have such
remedies against the party in fault as are allowed
the seller or the buyer, as the case may be.
Okay, so you could have here, still a valid contract of
sale even if the price is not certain as long as it is
ascertainable. Meaning you could have there a reference
to another thing which is certain or when the price is
fixed by a third person.
Do take note, that you have there also in 1469 that if the
third person who determines the price 1.) acts in bad
faith; or 2.) acts by mistake, the court may fix the price.
Notice in 1469, is the only instance where the parties can
seek court remedy to fix the price. If you notice the 2 nd
paragraph, we have there the term inefficacious. And
then, however, if the third person was prevented from
fixing the price through the fault of one of the parties,
the party not at fault is permitted to file an action against
the party who is at fault as against the seller or buyer as
the case may be.
Now even before the fixing of the price by the
designated third party, the contract of sale is already
perfected. If the parties have consented that a third
person may fix the price, the price may not be certain
because they will not know yet what is the price which
will be determined by the third person. But we know it is
a valid consideration because it is ascertainable.
If the third party is however unable or unwilling to fix
the price, distinguish it from yung in bad faith or by
mistake or an instance where it is prevented by one of
the parties. The parties cannot seek redress when unable
or unwilling to fix the price since the condition imposed
on the contract has not happened. So this is when you
have the term inefficacious.
What do you mean by inefficacious? It is the inability to
produce the effect desired by the parties. Now, third
party prevented by one party, again, you can file an
action in court or you could also apply here constructive
fulfillment under 1186 that you learned already in
ObliCon.
Article 1186. The condition shall be deemed
fulfilled when the obligor voluntarily prevents its
fulfillment.
Now, while 1369 allows a third party to fix the price as
determined or agreed upon by the parties. The third
person CANNOT determine the subject matter. So
distinguish that.
Now, how is price determined to be ascertainable? Of
course under Article 1469:
1. Set by third person
2. by the courts in the case provided
Also, by the parties.
Price can be certain by reference to a definite day of
particular exchange or market. We have Article
1472.
Article 1472. The price of securities, grain, liquids,
and other things shall also be considered
certain,when the price fixed is that which the thing
sold would have on a definite day, or in a particular
exchange or market, or when an amount is fixed
above or below the price on such day, or in such
exchange or market, provided said amount be
certain.
If the parties stipulated that the purchase price would be
for example, a share of stock, the purchase price would
be plus 5 pesos based on Makati Stock Exchange, pwede
ganyan. Or price maybe price of such rice in public
market on a specific day as long as such price must be
certain.
Another instance where it ascertainable, by reference to
another thing certain, such as to invoices then in
existence and clearly identified by the agreement or
when you have known factors or stipulated formula.
Now we have the case of Villanueva.
3. It must be certain or ascertainable at the
perfection.
VILLANUEVA VS. CA
267 SCRA 89
G.R. NO. 107624
JANUARY 28, 1997
FACTS:
Petitioner Gamaliel Villanueva has been a tenant-
occupant of a unit in an apartment building erected on a
parcel of land owned by private respondents dela Cruz.
In 1986, Jose dela Cruz offered said land with the
apartment building for sale and petitioners (Gamaliel
and Irene) showed interest in the property.
As initial step, Jose gave Irene a letter of authority for
her to inspect the property. Since the property was in
arrears for payment of realty taxes, Jose approached
Irene and asked for a certain amount to pay for the taxes
so that the property would be cleared of any
encumbrance. Irene gave 10k (5k on 2 occasions). It was
agreed by them that the 10k would form part of the sale
price of 550k.
Thereafter, Jose went to Irene, bringing with him Mr.
Sabio, requesting her to allow Sabio to purchase of the
property, to which they consented, so they would just
purchase the other half (265k, having paid the 10k). Dela
Cruz executed in favor of their co-defendants (Guido
and Felicitas Pile) a Deed of Assignment of the other
portion of the land, wherein Gamaliels apartment unit is
situated. This was purportedly as full payment and
satisfaction of an indebtedness obtained from the Piles.
TCT was later issued in the name of the Piles.
Soon, Gamaliel learned about the assignment and
issuance of new TCT. Petitioners elevated their
complaint to the Court (specific performance). They
contend that a contract of sale has been perfected and
that the 10k formed part of the purchase price
(necessarily then, there must have been an agreement as
to the price). They cite Art 1482: Whenever earnest
money is given in a contract of sale, it shall be
considered as part of the price and proof of perfection of
the contract. On the other hand, private respondents
claim that what was agreed upon was that the 10k be
primarily intended as payment for realty tax, and was
going to for part of the consideration of the sale if the
transaction would finally be consummated. They insist
that there was no clear agreement as to the true amount
of consideration.
ISSUE: Was there a perfected contract of sale? NO
HELD:
After a review of the evidence, SC found that there was
no agreement as to the price (based on the testimonies).
To settle the conflicting claims, petitioners could have
presented the contract of sale. However, it was not
presented in evidence. Petitioners aver that even if the
(unsigned) deed was not produced, Jose admitted
preparing said deed in accordance with their agreement.
We do not agree with petitioners. Assuming arguendo
that such draft deed existed, it does not necessarily
follow that there was already a definite agreement as to
the price. If there was, why then did private respondent
Jose de la Cruz not sign it? If indeed the draft deed of
sale was that important to petitioners' cause, they should
have shown some effort to procure it. They could have
secured it through a subpoena ducestecum or thru the
use of one of the modes of discovery. But petitioners
made no such effort. And even if produced, it would not
have commanded any probative value as it was not
signed.
The price of the leased land not having been fixed, the
essential elements which give life to the contract were
lacking. It follows that the lessee cannot compel the
lessor to sell the leased land to him.
The price must be certain; it must be real, not fictitious.
It is not necessary that the certainty of the price be actual
or determined at the time of executing the contract. The
fact that the exact amount to be paid therefor is not
precisely fixed, is no bar to an action to recover such
compensation, provided the contract, by its terms,
furnishes a basis or measure for ascertaining the amount
agreed upon. The price could be made certain by the
application of known factors. A contract of sale is not
void for uncertainty when the price, though not directly
stated in terms of pesos and centavos, can be made
certain by reference to existing invoices identified in the
agreement.
In the instant case, however, what is dramatically clear
from the evidence is that there was no meeting of mind
as to the price, expressly or impliedly, directly or
indirectly.
----
Q: Wasnt there an agreement that the price was 575K?
A: It was not agreed upon. The other party requested to
lower it to 550K, which was also not accepted by the
other party.
Q: How about the fact that there was already payment of
10K?
A: There was no agreement that it was a downpayment,
so there is no meeting of the minds.
Again, the price must be certain. It must be real, not
fictitious although it is not necessary that the certainty of
the price be actually determined at the time of executing
the contract. The fact that the exact amount to be paid
therefore is not precisely fixed is not a bar to such action
to recover such compensation. Provided, that the
contract by its terms provides a basis or measure for
ascertaining the amount agreed upon. The price may be
made certain by the application of certain factors.
However in this case, aside from the fact that there was
no meeting of the minds, 550k or 575K, there was
nothing shown that the price was in reference to another
thing. So here, there was no sale, as there was no price.
In the instant case, however, what is dramatically clear
from the evidence is that there was no meeting of mind
as to the price, expressly or impliedly, directly or
indirectly.
Now how about in the case of Moreno?
MORENO, JR. VS. PRIVATE MANAGEMENT
OFFICE
507 SCRA 63
G.R. NO. 159373
NOVEMBER 16, 2006
FACTS:
The subject-matter in the civil case is the J. Moreno
Building or more specifically, the 2nd, 3rd, 4th, 5th and
6th floors of the building.
Moreno is the owner of the Ground Floor, the 7th Floor
and the Penthouse of the J. Moreno Building and the lot
on which it stands.
Private Management Office (formerly, Asset
Privatization Trust or APT) on the other hand, is the
owner of the 2nd, 3rd, 4th, 5th and 6th floors of the
building, the subject-matter of this suit.
On February 13, 1993, APT called for a conference for
the purpose of discussing Morenos right of first refusal
over the floors of the building owned by APT. At said
meeting, APT informed Moreno that the proposed
purchase price for said floors was P21 Million.
In a letter dated February 22, 1993, APT, informed
Moreno that the Board of Trustees (BOT) of APT "is in
agreement that Mr. Jose Moreno, Jr. has the right of first
refusal" and requested Moreno to deposit 10% of the
"suggested indicative price" of P21 million on or before
February 26, 1993.
Moreno paid the P21 million on February 26, 1993. APT
issued an OR for the said payment.
But later, APT wrote Moreno that its Legal Department
has questioned the basis for the computation of the
indicative price for the said floors. Thus, on April 2,
1993, APT wrote Moreno that the APT BOT has
"tentatively agreed on a settlement price of
P42,274,702.17" for the said floors.
RTC ruled in favor of Moreno, declared that there was a
perfected contract of sale and ordered APT to sell the
subject floors at P21M.
CA reversed, hence the petition.
ISSUE: WON there was a perfected contract of sale
over the subject floors at the price of 21 Million. NO
HELD: A contract of sale is perfected at the moment
there is a meeting of minds upon the thing which is the
object of the contract and upon the price. Consent is
manifested by the meeting of the offer and the
acceptance upon the thing and the cause which are to
constitute the contract. The offer must be certain and the
acceptance absolute.
To reach that moment of perfection, the parties must
agree on the same thing in the same sense, so that their
minds meet as to all the terms. They must have a distinct
intention common to both and without doubt or
difference; until all understand alike, there can be no
assent, and therefore no contract. The minds of parties
must meet at every point; nothing can be left open for
further arrangement
So long as there is any uncertainty or indefiniteness, or
future negotiations or considerations to be had between
the parties, there is not a completed contract, and in fact,
there is no contract at all.
Once there is concurrence of the offer and acceptance of
the object and cause, the stage of negotiation is finished.
This situation does not obtain in the case at bar. The
letter of February 22, 1993 and the surrounding
circumstances clearly show that the parties are not past
the stage of negotiation, hence there could not have been
a perfected contract of sale.
The letter is clear evidence that APT did not intend to
sell the subject floors at the price certainofP21M. The
letter clearly states that P21M is merely a "suggested
indicative price" of the subject floors as it was yet to be
approved by the BOT.
Before the Board could confirm the suggested indicative
price, the Committee on Privatization must first approve
the terms of the sale or disposition. It appears in the case
at bar that Morenos construction of the letter of
February 22, 1993 that his assent to the "suggested
indicative price" of P21M converted it as the price
certain, thus giving rise to a perfected contract of sale is
his own subjective understanding. As such, it is not
shared by APT.
----
Q: What were the precise words written?
A: xxx We are pleased to inform you that the Board is in
agreement that Mr. Jose Moreno, Jr. has the right of first
refusal. This will be confirmed by our Board during the
next board meeting on February 26, 1993. In the
meantime, please advise Mr. Moreno that the suggested
indicative price for APTs five (5) floors of the building
in question is P21 Million.
If Mr. Moreno is in agreement, he should deposit with
APT the amount of P2.1 Million equivalent to 10% of
the price on or before February 26, 1993. The balance
will be due within fifteen (15) days after Mr. Moreno
receives the formal notice of approval of the indicative
price. Xxx
Q: Was there a valid consideration here?
A: NO. This did not pass the negotiation stage, hence no
perfected Contract of Sale, no consideration.
Again, price must be certain. Offer must be certain, and
acceptance must be absolute. Now, I asked. What were
the specific words that were written in the letter? 10% of
the suggested indicative price. In other words,
suggested pa siya,subject to approval. Dahil yun sa
kanilang usapan sa negotiation stage. So even if there
was payment of the 10%, it did not result to a perfected
contract of sale because it is clear that the offer was not
yet certain at that time.
What we have here is a suggested indicative price where
the sale involves the sale of an asset under a
privatization scheme which attaches a peculiar meaning
or signification to the term "indicative price." Remember
the interpretation with regard to terms, as merely
constituting a ball-park figure then the price is not
certain. So there was a use of interpretation of terms
(statcon principle).
So again, the price suggested pa yun, wala pa yung
approval. It is yet to be approved by the Board of
Trustees and therefore the consideration was not certain
and therefore, walang COS.
Now take note, or you probably remember this under
Oblicon, the price or consideration can never be set by
one of the parties. Article 1473.
Article 1473. The fixing of the price can never be
left to the discretion of one of the contracting
parties. However, if the price fixed by one of the
parties is accepted by the other, the sale is
perfected.
Now what is the effect if the price is unascertainable?
As provided in Article 1469, the status is inefficacious.
When we say inefficacious, again it only means the
inability to produce the effect desired by the parties. It
does not mean that the sale is void. Because if it is void,
sinabi na sana dyan na it is void. It is inefficacious so
meaning it is valid. It is not void because there is an
implied acknowledgment that the existence of the form
allowed by law at the point of perfection has actually
rendered the contract valid but only conditional. The sale
would just not take into effect. So if subsequently the
parties would decide na O sige, kita na lang magsabot
because the third party is unable or unwilling to fix it, it
would still eb a valid contract.
Even if the sale is deemed inefficacious, we still have to
consider Article 1474
Article 1474. Where the price cannot be determined
in accordance with the preceding articles, or in any
other manner, the contract is inefficacious.
However, if the thing or any part thereof has been
delivered to and appropriated by the buyer he must
pay a reasonable price therefor. What is a
reasonable price is a question of fact dependent on
the circumstances of each particular case.
Ok, so again noh, such sale would be considered
inefficacious, but if there is already appropriation on the
part of the buyer, it is just fair that the buyer pay a
reasonable price for such subject matter. Again as you
have noticed, when you say reasonable it will always
depend upon the circumstances of each particular case.
With regard to this element, that the price must be
certain or ascertainable, we have Articles 1469 to 1474.
It is certain, if it is expressed in terms of specific
amounts of money, it can still be considered
ascertainable if it is with reference to another thing
certain or even when left to the judgment of a specified
persons as agreed by the parties.
Also we have Article 1472. Do remember the provisions
under Obligations and Contracts in relation to
consideration. We have Article 1350, we also have
Article 1351 wherein motive must be distinguished from
cause or consideration. When is it unlawful, we have
Article 1352. Article 1353 we have discussed before
when the consideration is false. We have Article 1354
presumption as to consideration and 1355 in case there is
fraud.
5 minute break!