SALES LAW

MIDTERMS
Name: Aubrey Rose Millean A.Rabena
3BSA01

I. DEFINITION (40points) - 2points each.

1. Contact of Sale
-A contract of sale is a contract whereby one of the parties obligates himself to deliver
something to the other who, on his part, binds himself to pay therefore a sum of money or its
equivalent.
2. Consensual Contract
- A contract that is perfected by mere consent without any further act at the moment there
is the meeting of the minds upon the thing which is the object of the contract and upon the price.
3. Contract for a piece of work
- The contractor bins himself to execute a piece of work for the employer, in
consideration of a certain price or compensation.
4. Future Goods
- Future Goods are goods to be manufactured, raised or acquired.
5. Fungible Goods
- Goods of which any unit is, from its nature or by mercantile usage, treated as the
equivalent of any other unit such as grain, oil, wine, gasoline, etc.
6. Resolutory Condition
- Resolutory Condition is an uncertain event upon the happening of which the obligation
subject to its extinguished.
7. Barter
- One of the parties binds himself to give one thing in consideration of the other’s
promise to give another thing.
8. Ipso Facto
-Means by the fact itself.
9. Res Perit Domino
 - If the thing is lost before perfection, the seller and not the one who intends to purchase
it bears the loss in accordance with the principle that the thing perishes with the owner.
10. Policitation
- Unaccepted imperfect promise or offer.
11. Earnest Money
- Is something of value given by the buyer to the seller to show that the buyer is really in
earnest, and to bind the bargain.
12. Option Money
- Option money is the money given as distinct consideration for an option contract
13. Compromise
- is a contract whereby the parties, by reciprocal concessions, avoid a litigation or put an
end to one already commenced.
14. Traditio Longa Manu
- This mode of delivery takes place by the mere consent or agreement of the contracting
parties as when the vendor merely points to the thing sold which shall thereafter be at the control
and disposal of the vendee.
15. Constitutum Possessorium
- It takes place when the vendor continues in possession of the property sold not as owner
but in some other capacity, as for example, when the vendor stays as a tenant of the vendee.
16. Bill of Lading
- It is a contract and a receipt for the transport of goods and their delivery to the person
named therein, to order, or to bearer.

17. Quedan
- A warehouse receipt usually for sugar received by a warehouseman.
18. FOB
- Free On Board
19. CIF
- Cost, Insurance and Freight
20. Stoppage in Transitu
 - Is the injustice of allowing the buyer to acquire ownership and possession of the goods
when he has not paid and, owing to his insolvency, cannot pay the price which was to be given in
return for the goods.

II. ENUMERATION (30points) -5points each

1. What are the essential requisites of contract?
 Consent
 Object
 Cause or Consideration
2. In a contract of sale of a personal property which is payable in installments, what are the
remedies of the seller in the event the buyer fails to pay?
 Elect fulfillment upon the vendee’s failure to pay
 Cancel the sale, if the vendee shall have failed to pay two
or more installments
 Foreclose the chattel mortgage, if one has been constituted, if the vendee shall have failed
to pay two or more installments.
3. Who are the persons relatively incapacitated to enter into a contract of sale?
 Husband and Wife
4. What are the principal obligations of the vendor?
 To transfer the ownership of the determinate thing sold
 To deliver the thing, with its accessions and accessories, if any, in the condition in which
they were upon the perfection of the contract
 To warrant against eviction and against hidden defects
 To take care of the thing, pending delivery, with proper diligence
 To pay for the expenses of the deed of sale, unless there is a stipulation to the contrary.

5.What are the different types of Constructive or Legal Delivery?

 Execution of a public instrument
 Symbolical Tradition
 Traditio Longa Manu
 Traditio Brevi Manu
 Traditio constitutum possessorium
 Quasi- delivery

1. What are the remedies of an unpaid seller?

 A right to retain them for the price while in his possession
  A right of stopping the goods in transitu in case of insolvency of the buyer
 A right of resale
 A right to rescind the sale.

III. ESSAY (30points) - 5points each

1. S sold to B certain goods. At the time of the sale, S is not the owner of the goods. Is the
sale valid?
Yes, According to Article 1459 The seller can only sell what he owns, however, it does
not require that the seller must have the right to transfer ownership of the property sold at
the time of the perfection of the contract. As long as you have the object during the
delivery stage of the contract then the sale is valid. Therefore, the contract of sale of S
and B are valid because S has the certain goods and already sold it to B without any
problem.
2. H and W are husband and wife. After selling his property to W, H borrowed a big amount
of money from C. It appears that H is now bankrupt. Has C the right to question the sale of H’s
property to W in order to have said property answer for H’s indebtedness to him?
No, because According to Article 1490, Those who are permitted to question the sale are
Heirs of the spouse, creditors at the time of transfer but not creditors who became such only after
the transaction. C became a creditor to H only after the transfer has been made, Therefore, C has
no right to question the sale of the husband and wife.
3. S sold to B 100 bags of sugar at P70 per bag for a total of P70,000. S was able to deliver
only 98 bags because the two bags were stolen without the fault of S. Has S the right to insist
that B pay the 98 bags since there was no fault in his part and only two bags are lacking? What
rights, if any are given by law to B?
According to Article 1494, B has two options its either he can withdraw from the contract
without the obligation to pay or demand the delivery of the 98 bags of sugar but binding him to
pay the agreed price which is P68,600. Therefore, S has no right to insist but wait for the
decision of B of what is his option to give.
4. S sold to B a piano for P10,000. It was agreed that payment shall be made within 10 days.
Has B the right to demand delivery even before he has paid?
Yes, According to Article 1524 If there is a period fixed the vendor even if there is no
payment made by the vendee, the vendor is obliged to deliver the thing sold. Therefore, B can
demand delivery even before he has paid because there was a period stipulated in the contract.
5. S, a minor, sold his car to B. B thereafter sold the car to C. In this case, who is the
rightful owner of the car?
 C is the rightful owner of the car because even though S is a minor, A contract of
sale has already been made to B, and B Sold the car to C who is the rightful owner of the car
now.
6. S sold his horse to B for P8,000. No date or condition was stipulated for the delivery of
the horse. While still in the possession of S, the horse gave birth to a colt. Who has the right to
the colt?
It depends, According to Article 1537, The vendor is bound to deliver the thing sold and
its accessories and accessions in the condition in which they were upon the perfection of the
contract. If B has paid the purchase price then he has the right to the colt that was born after the
perfection of the contract., but if B has not yet paid the purchase price then S has the right to the
colt that was born before the delivery and S can not give the colt to B.