Title RFBT Module on Law on Sales.pdf ✅

RFBT – Module 3: Law on Sales Atty. Bernadette C. Mendoza, JD, CPA Page 2 of 53  Must be determinate or at least capable of being made determinate (NO SALE if not determinate) 3. Price (cause or consideration) – price certain in money or its equivalent (check, promissory note) which is the consideration for the thing sold a. “Its equivalent” – payment need not be in money, there can be a sale where the thing given as token of payment has been assessed and evaluated and its price equivalent in terms of money has been determined b. Price must be real, not fictitious c. A seller cannot render invalid a perfected contract of sale by merely contradicting the buyer’s allegation regarding the price d. No requirement in sales that the price be equal to the exact value of the thing subject matter of the sale e. Presumption is that a contract has sufficient consideration When definite agreement on manner of payment essential  A definite agreement on the manner of payment of the purchase price is an essential element in the formation of a binding and enforceable contract of sale Absence of any of the 3 essential elements negates the existence of a perfected contract of sale 06 Which of the following is NOT an essential element of a contract of sale? A. There must be transfer of possession of goods C. There must be transfer of ownership in the goods B. There must be some price for goods D. There must be some goods as subject matter 07 Which of the following is NOT one of the essential requisites of a valid contract of sale? A. Price certain in money or its equivalent C. Determinate subject matter B. Delivery of the object sold D. Consent of the contracting parties 08 Which of the following statements about price in a contract of sale is true? A. The seller can invalidate the contract by denying the buyer’s stated price. B. The price must be real and certain in money or its equivalent. C. The price must be equal to the exact value of the thing sold. D. The price must be fictitious to avoid disputes. 09 Why is a price paid using a check considered valid in a contract of sale? A. Because checks are considered equivalent to money when properly valued and accepted by both parties B. Because checks are always backed by cash C. Because checks eliminate the need for a written contract D. Because checks are the only legal form of payment 10 A contract of sale is perfected by mere consent. State the effect of perfection of sale: A. From the moment of perfection, the parties may reciprocally demand performance, subject to the requirements on forms of contracts B. From that moment, the ownership over the object is transferred to the buyer C. From that moment, the parties should make delivery of the object and price in order not to incur delay 11 What happens if the object of the contract of sale is not determinate or cannot be made determinate? A. The contract is voidable. C. The contract is rescissible. B. The contract is unenforceable. D. There is no sale. NATURAL AND ACCIDENTAL ELEMENTS 1. Natural elements – those which are deemed to exist in certain contracts like warranty against eviction or hidden effects 2. Accidental elements –may be present or absent depending on the stipulations of the parties like conditions, interest, penalty, time or place of payment 12 The following are the essential elements of a contract of sale, except A. Consent of the contracting parties B. Subject matter which should be determinate (object certain) C. Price which is certain in money or its equivalent D. Warranty against eviction and against hidden defects 13 Which of the following is considered an accidental element in a contract of sale? A. Determinate subject matter C. Stipulation on interest or payment terms B. Price certain in money or its equivalent D. Consent of the parties 14 Which of the following best describes accidental elements in a contract? A. They are agreed upon by the parties to supplement the contract. B. They are imposed by law and cannot be modified. C. They are the cause or consideration of the contract. D. They are required for the contract to be valid. 15 What is the effect of the absence of accidental elements in a contract of sale? ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA
RFBT – Module 3: Law on Sales Atty. Bernadette C. Mendoza, JD, CPA Page 3 of 53 A. The contract becomes voidable. C. The contract is unenforceable. B. The contract is void. D. The contract remains valid and enforceable. Stages in the life of a contract of sale Stage Key Feature Legal Effect Negotiation Discussion of terms No binding contract yet Perfection Agreement on object and price Contract becomes valid Consummation Delivery and payment Ownership transfers; obligations fulfilled 16 It refers to a unilateral promise to buy or sell which is not accepted by the other party: A. Earnest B. Policitacion C. Option D. None of the above 17 What marks the perfection of a contract of sale? A. Delivery of the object C. Agreement on object and price B. Execution of a deed of sale D. Payment of the price 18 Arn offered to sell his lot to Boyet for P100,000. In his offer to sell it was stated that he is given 60 days to prepare the P100,000 and as soon as Boyet is ready with the money, Arn will execute a deed of sale. Before the end of 60 days, Arn informed Boyet that the price of the lot was increased to P120,000. May Boyet compel Arn to accept P100,000 offered previously by Arn and make him execute the deed of sale? A. Yes, because Arn already signed his offer. B. No, for Boyet never signified his acceptance of Arn’s offer. C. Yes, because there was actual meeting of minds of the parties. D. None of the above Delivery of Subject Matter Note: When SELLER MUST BE the OWNER of the thing to be delivered – only at a time of delivery (transfer of ownership); Vendor need not be owner of thing at the time of perfection; Significance of delivery - part of the consummation stage of the contract of sales 19 Ownership of the thing sold is (There are two kinds of delivery or traditio as a consequence of the contract of sale) A. Retained by the seller in “sale or return” (F) B. Transferred to the buyer upon constructive or actual delivery of the thing sold C. Acquired by the buyer upon perfection of the contract (not a mode of acquiring ownership) D. Transferred to the buyer upon acceptance of the price (not a mode of acquiring ownership) *Actual Delivery is also known as Real delivery. 20 In a sale, this is actual delivery A. Execution and signing of the deed of sale B. Goods sold are placed in the control and possession of the vendee (claim to ownership) C. Delivery by the vendor of the keys to the place where the goods are kept or stored D. The vendee is already in possession of the goods even before the sale 21 Refers to the delivery of the thing sold from hand to hand in case of movables, or the taking of possession with respect to immovable, in the presence and with the consent of the vendor A. Actual or real delivery C. Traditio constitutum possessorium B. Traditio longa manu D. Traditio brevi manu Constructive Delivery requires three things before ownership may be transmitted: 1. Seller must have control over the thing 2. Buyer must be put under control 3. There must be the intention to deliver the thing for purposes of transferring ownership (ex. not merely to allow inspection) Rules on Constructive Delivery 1. If a seller has no actual possession, he cannot transfer ownership by constructive delivery 2. There can be no constructive delivery by means of a public instrument if there is a stipulation to that effect 3. The Civil Code does not provide that the execution of the deed is a conclusive presumption of the delivery of possession. What it says is that the execution thereof shall be equivalent to delivery – there is only a disputable presumption (presumptive delivery) Constructive (or Legal) Delivery Traditio Constitutum Possessorium (Art. 1500) takes place after the seller of the property continues in possession of said property no longer as owner but as a mere possessor such as by virtue of a lease agreement with the vendee; the change in intention of ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA ACREV424 BCMENDOZA