Professional Documents
Culture Documents
Artates and Pojas v. Urbi, et. al. L-29421, January QUESTION: Should the seller be the owner at the time of
30, 1971 perfection of the contract?
- Under Section 118 of the Public Land Act (Com. Act
141), such homestead generally cannot be sold, ANSWER:
cannot be encumbered and cannot be held liable for - GR: No. Seller must have the right to transfer
the satisfaction of any debt CONTRACTED prior to
ownership at the time of delivery or
the expiration of the period of 5 years from and
after the date of the issuance of the patent or grant. consummation stage. He need not be the owner at
The sale, therefore of a homestead patent which was the time of perfection of the contract.
made less than 4 years after the acquisition of the - XPN: Foreclosure sale wherein the mortgagor
couple of the land is NOT VALID. should be the absolute owner.
Vain Hope or Expectancy Asian Terminals, Inc. v. Philam Insurance Co., Inc.
- If the hope or expectancy itself is vain, the sale is - A letter of credit (L/C) is a financial device
itself VOID. Be it noted that this is NOT an aleatory developed by merchants as a convenient and
contract for while in an aleatory contract there is an relatively safe mode of dealing with sale of goods to
element of chance, here, there is completely NO satisfy the seemingly irreconcilable interests of a
CHANCE. seller, who refuses to part with his goods before he
is paid, and a buyer, who wants to have control of
Article 1462. The goods which form the subject of a his goods before paying
contract of sale may be either existing goods, owned or
possessed by the seller, or goods to be manufactured,
raised, or acquired by the seller after the perfection of
the contract of sale, in this Title called “future goods.”
Transfer of ownership
a) Mere perfection of the contract does not transfer
ownership. Ownership of the object sold is
transferred only after delivery (tradition), actual,
Ma. Tiffany T. Cabigon
Bachelor of Laws SALES
University of Negros Occidental-Recoletos Page 21
Article 1476. In the case of a sale by auction: a) The bidder may retract his bid (Art. 1476[2])
Reason: Every bidding is merely an offer and,
(1) Where goods are put up for sale by auction in lots,
therefore, before it is accepted, it may be
each lot is the subject of a separate contract of sale.
withdrawn. The assent is signified on the part of
(2) A sale by auction is perfected when the auctioneer the seller by knocking down the hammer.
announces its perfection by the fall of the hammer, or in b) The auctioneer may withdraw the goods from the
other customary manner. Until such announcement is sale (Art. 1476[2]) Reason: This bid is merely an
made, any bidder may retract his bid; and the auctioneer offer, not an acceptance of an offer to sell.
may withdraw the goods from the sale unless the auction Therefore it can be rejected. What the auctioneer
has been announced to be without reserve. does in withdrawing is merely reject the offer.
(3) A right to bid may be reserved expressly by on behalf Under what conditions may the seller bid? (Art.
of the seller, unless otherwise provided by law or by 1476, pars. 3 and 4)
stipulation. a) When such a right to bid was reserved;
b) And notice was given that the sale by auction is
(4) Where notice has not been given that a sale by auction subject to a right to bid on behalf of the seller
is subject to a right to bid on behalf of the seller, it shall
not be lawful for the seller to bid himself or to employ or When Seller May Employ Others to Bid for Him
induce any person to bid at such sale on his behalf or for - The seller may employ others to bid for him
the auctioneer, to employ or induce any person to bid at provided he has notified the public that the auction
such sale on behalf of the seller or knowingly to take any is subject to the right to bid on behalf of the seller.
bid from the seller or any person employed by him. Any (Art. 1476, par. 4) People who bid for the seller, but
sale contravening this rule may be treated as fraudulent are not themselves bound, are called “by-bidders” or
by the buyer. “puffers.” Without the notice, any sale contravening
the rule may be treated by the buyer as fraudulent.
When Sale by Auction is Perfected
- The sale is perfected when the auctioneer Veazie v. Williams
announces its perfection by the fall of the hammer - The sale can be annulled in view of the fraud. Had
or in other customary manner. the public been informed of the puffers, this would
have been different. To escape censure, notice of by
Before the Fall of the Hammer bids is essential. By-bidding, if secret, deceives and
Before the hammer falls: involves a falsehood and is, therefore, bad. It is not
enough to apologize and say that by-bidding is after
Ma. Tiffany T. Cabigon
Bachelor of Laws SALES
University of Negros Occidental-Recoletos Page 22
all common. It does not matter that the owner did Kinds of delivery
not know of the auctioneer’s fraud. After all, the a) Actual (Art. 1497, Civil Code)
auctioneer was merely the agent. b) Constructive (Arts. 1498-1601, Civil Code),
including “any other manner signifying an
CFI of Rizal and Elena Ong Escutin v. CA and Felix agreement that the possession is transferred.” (Art.
Ong 1496, Civil Code)
- A private sale authorized by a probate court
cannot be assailed by a person who is not an C.N. Hodges, et. al. v. Jose Manuel Lezama, et.al. L-
“interested party” one who merely offered a higher 20630, Aug. 31, 1965
price (without actually buying the property) is not - If upon the sale by Hodges to Borja, Borja became
an “interested party.” It would have been different the owner thereof, then, upon Hodge’s purchase of
had there been a public auction. the shares at the foreclosure proceedings, Hodges
acquired ownership over the same. Stock Certificate
Republic v. Reyes-Bakunawa 18 must be cancelled; a new one must be given to
- A negotiated contract is one that is awarded on the Hodges; and eventually, a new one also issued to
basis of a direct agreement between the Government Gurrea after the deal between Hodges and Gurrea is
and the contractor without going through the finally settled.
normal procurement process, like obtaining the
prior approval from another authority, or a Article 1478. The parties may stipulate that ownership in
competitive bidding process. the thing shall not pass to the purchaser until he has
fully paid the price.
Article 1477. The ownership of the thing sold shall be
transferred to the vendee upon the actual or constructive When Ownership is Not Transferred Despite
delivery thereof. Delivery
- Generally, ownership is transferred upon delivery,
When Ownership is Transferred but even if delivered, the ownership may still be
- Ownership is not transferred by perfection but by with the seller till full payment of the price is made,
delivery. This is true even if the sale has been made if there is a stipulation to this effect. But, of course,
on credit; payment of the purchase price is NOT innocent third parties cannot be prejudiced.
essential to the transfer of ownership, as long as the
property sold has been delivered.
Article 1486. In the cases referred to in the two preceding - Coverage: All transactions or contracts involving
articles, a stipulation that the installments or rents paid the sale or financing of real estate on installment
shall not be returned to the vendee or lessee shall be payments, including condominium apartments
valid insofar as the same may not be unconscionable where the buyer has paid at least 2 years of
under the circumstances. installments (Section 3)
Maceda Law Upon the other hand, refers to sale of movables payable in
The Maceda Law (R.A. 6552) is applicable to sales of instalments and limiting the right of seller, in case of
immovable property on instalments. default by the buyer to one of the remedies, namely:
a) Exact (or specific) fulfilment;
In Rillo v Court of Appeals, 247 SCRA 431, the most b) Cancel the sale if two (2) or more instalments have not
important features, have been laid down, namely: been paid; and
a) After having paid instalment far at least two (2)
c) Foreclose the chattel mortgage. On the things sold, also
years, the buyer is entitled to a mandatory grace period
in case of default of two (2) or more instalments, with no
of one (1) month for every year of instalment payments
further action against the purchaser.
made, to pay the unpaid instalments without interest.
Reason why generally a husband and wife cannot Article 1491. The following persons cannot acquire by
sell to each other purchase, even at a public or judicial auction, either in
- To avoid prejudice to 3rd persons person or through the mediation of another:
- To prevent one spouse from unduly influencing
the other (1) The guardian, the property of the person or persons
- To avoid by indirection the violation of the who may be under his guardianship;
prohibition against donations
(2) Agents, the property whose administration or sale
Effect of Sale may have been intrusted to them, unless the consent of
- Generally, a sale by one spouse to another is
the principal has been given;
void
- However, not everybody can assail the validity
(3) Executors and administrators, the property of the
of the transaction. Thus, creditors who became
such AFTER the transaction cannot assail its estate under administration;
validity for the reason that they cannot be said
to have been prejudiced. (4) Public officers and employees, the property of the
- But PRIOR creditors as well as the heirs of either State or of any subdivision thereof, or of any
spouse may invoke the nullity of the sale government-owned or controlled corporation or
- The spouses themselves since they are parties institution, the administration of which has been
to an illegal act cannot avail themselves of the intrusted to them; this provision shall apply to judges and
illegality of the sale. The law will generally leave government experts who, in any manner whatsoever,
them as they are.
take part in the sale;
- Under the 2 exceptions under Art. 1490, the sale
is generally valid, but should there be vitiated
consent, the sale is voidable.
- Just as married couple cannot generally sell to
each other, they also cannot donate to each
other. (Art. 87, Family Code)
Purchase By Attorney
- A lawyer is not allowed to purchase the
property of his client which is in litigation. To
Complete Loss Distinguished from Partial Loss Article 1495. The vendor is bound to transfer the
Note the difference in the rules ownership of and deliver, as well as warrant the thing
(a) When the object has been COMPLETELY LOST; which is the object of the sale.
(b) When the object has been PARTLY or PARTIALLY
LOST. [Remedies:
1) withdrawal (or rescission)
Article 1525. The seller of goods is deemed to be an (2) In case of the insolvency of the buyer, a right of
unpaid seller within the meaning of this Title: stopping the goods in transitu after he has parted with the
possession of them;
(1) When the whole of the price has not been paid or
tendered; (3) A right of resale as limited by this Title;
(2) When a bill of exchange or other negotiable instrument (4) A right to rescind the sale as likewise limited by this
has been received as conditional payment, and the Title. Where the ownership in the goods has not passed to
condition on which it was received has been broken by the buyer, the unpaid seller has, in addition to his other
reason of the dishonor of the instrument, the insolvency of remedies, a right of withholding delivery similar to and
the buyer, or otherwise. In Articles 1525 to 1535 the term coextensive with his rights of lien and stoppage in transitu
“seller” includes an agent of the seller to whom the bill of where the ownership has passed to the buyer.
lading has been indorsed, or a consignor or agent who has
himself paid, or is directly responsible for the price, or any
otherWhen Seller
person whoisisDeemed an “Unpaid
in the position Seller”
of a seller.
(1) Where the goods have been sold without any Article 1529. The unpaid seller of goods loses his lien
stipulation as to credit; thereon:
(2) Where the goods have been sold on credit, but the term (1) When he delivers the goods to a carrier or other bailee
of credit has expired; for the purpose of transmission to the buyer without
reserving the ownership in the goods or the right to the
(3) Where the buyer becomes insolvent. possession thereof;
The seller may exercise his right of lien notwithstanding (2) When the buyer or his agent lawfully obtains
that he is in possession of the goods as agent or bailee for possession of the goods;
the buyer.
(3) By waiver thereof. The unpaid seller of goods, having
- This article refers to the cases when the unpaid a lien thereon, does not lose his lien by reason only that he
seller has a possessory lien. has obtained judgment or decree for the price of the
goods.
NOTE: This possessory lien, however, remains only so long
as the property is still with the vendor.
Ma. Tiffany T. Cabigon
Bachelor of Laws SALES
University of Negros Occidental-Recoletos Page 52
When Possessory Lien is Lost Who May Exercise the Right of Stoppage in
a. This refers to the instances when “the lien is Transitu
lost.” - The right of stoppage in transitu may be exercised
b. The lien lost is only the possessory lien and by any person who as between himself and a
not the vendor’s lien on the price. purchaser, may be regarded as an unpaid vendor.
PROBLEM: S delivered the goods to the carrier for Article 1531. Goods are in transit within the meaning of
transmission to the buyer. He, however, reserved his right the preceding article:
to the ownership in the goods. Does he lose his possessory
lien? (1) From the time when they are delivered to a carrier by
land, water, or air, or other bailee for the purpose of
ANSWER: No, in view of the reservation. transmission to the buyer, until the buyer, or his agent in
that behalf, takes delivery of them from such carrier or
other bailee;
Article 1530. Subject to the provisions of this Title, when
the buyer of goods is or becomes insolvent, the unpaid (2) If the goods are rejected by the buyer, and the carrier
seller who has parted with the possession of the goods has or other bailee continues in possession of them, even if the
the right of stopping them in transitu, that is to say, he seller has refused to receive them back.
may resume possession of the goods at any time while
they are in transit, and he will then become entitled to the Goods are no longer in transit within the meaning of the
same rights in regard to the goods as he would have had preceding article:
if he had never parted with the possession.
(1) If the buyer, or his agent in that behalf, obtains
Right of Stoppage in Transitu delivery of the goods before their arrival at the appointed
- This refers to the right of stoppage in transitu, destination;
available to the unpaid seller —
(2) If, after the arrival of the goods at the appointed
a. if he has parted with the possession of the
destination, the carrier or other bailee acknowledges to
goods;
the buyer or his agent that he holds the goods on his
b. AND if the buyer is or becomes insolvent.
behalf and continues in possession of them as bailee for
the buyer or his agent; and it is immaterial that further
Meaning of Insolvency in the Article
destination for the goods may have been indicated by the
- The insolvency referred to need not be judicially
buyer;
declared.
This Article Refers to the Sale of Real Estate By the ANSWER: A may accept 1,000 square meters and reject the
Unit extra 500, in which case he will pay only P10 million.
However, A is also allowed to accept all of the 1,500 square
Virgilio Dionisio v. Hon. Vicente Paterno meters, but he must pay P15 million. A is in no case
- If a contract is a “unit price contract” (as allowed to rescind the contract, for such a remedy is not
distinguished from a “lump sum contract”) payment allowed him under this article.
will be made only on the basis of contractual items
actually performed, in accordance with the given Article 1541. The provisions of the two preceding articles
plans and specifications. shall apply to judicial sales.
Article 1563. In the case of contract of sale of a specified This provision shall not apply if the contrary has been
article under its patent or other trade name, there is no stipulated, and the vendor was not aware of the hidden
warranty as to its fitness for any particular purpose, faults or defects in the thing sold.
unless there is a stipulation to the contrary.
Responsibility for Hidden Defects Even if Seller
Effect of Sale Under the Patent Name or Trade Was in Good Faith
Name Why is the seller responsible for hidden defects even
- Note that here there is generally no warranty as to if he is in good faith?
the article’s “fitness for any particular purpose.”
ANSWER: Because he has to repair the damage done.
Article 1569. If the thing sold had any hidden fault at the Effect of Mere Notification
time of the sale, and should thereafter be lost by a - The buyer notifies the seller of the existence of the
fortuitous event or through the fault of the vendee, the hidden defect, but does not sue within 6 months,
latter may demand of the vendor the price which he paid, the action will of course prescribe.
less the value which the thing had when it was lost.
The Three Cases Contemplated Article 1591. Should the vendor have reasonable grounds
(a) In No. (1), no demand is needed. to fear the loss of immovable property sold and its price,
(b) In No. (2), the reason for the law is that the he may immediately sue for the rescission of the sale.
fruits or income is sufficient to warrant the
payment of interest. Should such ground not exist, the provisions of Article
(c) In No. (3), “default” is mora, called “in delay” 1191 shall be observed.
under the provisions of the Civil Code.
When Seller May Immediately Sue for the
Rule for Monetary Obligations Rescission of the Sale
- In a monetary obligation (like the obligation to pay The seller must have reasonable grounds to fear:
the purchase price) in the absence of stipulation, (a) LOSS of the immovable property sold, and
legal interest takes the place of damages. (b) LOSS of the price. So, if the buyer is
squandering his money, but the immovable property
Article 1590. Should the vendee be disturbed in the remains untouched, this article cannot apply.
possession or ownership of the thing acquired, or should
he have reasonable grounds to fear such disturbance, by a Article 1592. In the sale of immovable property, even
vindicatory action or a foreclosure of mortgage, he may though it may have been stipulated that upon failure to
suspend the payment of the price until the vendor has pay the price at the time agreed upon the rescission of the
caused the disturbance or danger to cease, unless the contract shall of right take place, the vendee may pay
latter gives security for the return of the price in a proper even after the expiration of the period, as long as no
case, or it has been stipulated that, notwithstanding any demand for rescission of the contract has been made upon
such contingency, the vendee shall be bound to make the him either judicially or by a notarial act. After the
payment. A mere act of trespass shall not authorize the demand, the court may not grant him a new term.
suspension of the payment of the price.
(3) Refuse to accept the goods, and maintain an action Where the buyer is entitled to rescind the sale and elects to
against the seller for damages for the breach of warranty; do so, if the seller refuses to accept an offer of the buyer to
return the goods, the buyer shall thereafter be deemed to
(4) Rescind the contract of sale and refuse to receive the hold the goods as bailee for the seller, but subject to a lien
goods or if the goods have already been received, return to secure payment of any portion of the price which has
them or offer to return them to the seller and recover the been paid, and with the remedies for the enforcement of
price or any part thereof which has been paid. such lien allowed to an unpaid seller by Article 1526. (5)
When the buyer has claimed and been granted a remedy in In the case of breach of warranty of quality, such loss, in
anyone of these ways, no other remedy can thereafter be the absence of special circumstances showing proximate
granted, without prejudice to the provisions of the second damage of a greater amount, is the difference between
paragraph of Article 1191. the value of the goods at the time of delivery to the buyer
and the value they would have had if they had answered
Where the goods have been delivered to the buyer, he cannot to the warranty.
rescind the sale if he knew of the breach of warranty when
he accepted the goods without protest, or if he fails to notify
the seller within a reasonable time of the election to rescind, Effect if Buyer Selects Any of the Four Remedies
or if he fails to return or to offer to return the goods to the Given
seller in substantially as good condition as they were in at - If the buyer has selected any of the remedies, and
the time the ownership was transferred to the buyer. But if has been GRANTED the same, no other remedy can
deterioration or injury of the goods is due to the breach of be given. However, the second paragraph of Art.
warranty, such deterioration or injury shall not prevent the 1191 will still apply.
buyer from returning or offering to return the goods of the
seller and rescinding the sale.
Definition of Equitable Mortgage Article 1606. The right referred to in Article 1601, in the
- One which although lacking in some formality, form absence of an express agreement, shall last four years
or words, or other requisites demanded by a statute from the date of the contract.
nevertheless reveals the intention of the parties to
charge a real property as security for a debt, and Should there be an agreement, the period cannot exceed
contains nothing impossible or contrary to law. ten years.
Effect of Stipulation Providing for a Renewal of However, the vendor may still exercise the right to
the Pacto de Retro repurchase within thirty days from the time final
- In a contract of sale con pacto de retro it was judgment was rendered in a civil action on the basis that
agreed that after the period fixed for the repurchase, the contract was a true sale with right to repurchase.
the buyer does not become the owner but a new
pacto de retro document shall be issued. Time Within Which to Redeem
(a) Meaning of express agreement:
Article 1603. In case of doubt, a contract purporting to be - This refers to the time.
a sale with right to repurchase shall be construed as an (b) Rules:
equitable mortgage. 1) No time agreed upon — 4 years from
date of contract.
2) Time agreed upon — period cannot
Article 1604. The provisions of Article 1602 shall also exceed 10 years.
apply to a contract purporting to be an absolute sale.
Reason for Limiting the Period of Redemption
- The law does not favor suspended ownership.
Article 1605. In the cases referred to in Articles 1602 and
1604, the apparent vendor may ask for the reformation of
the instrument.
Reason for the Law Article 1613. In the case of the preceding article, the
- If the law were otherwise, then in the example given, vendee may demand of all the vendors or co-heirs that
should S be allowed to repurchase only half of the they come to an agreement upon the repurchase of the
property, there would again be co-ownership. It whole thing sold; and should they fail to do so, the
should be remembered that co-ownership is NOT vendee cannot be compelled to consent to a partial
looked upon favorably by the law. redemption.
Article 1612. If several persons, jointly and in the same Reason for the Law
contract, should sell an undivided immovable with a - The law is against co-ownership.
right of repurchase, none of them may exercise this
right for more than his respective share. Article 1614. Each one of the co-owners of an undivided
immovable who may have sold his share separately, may
The same rule shall apply if the person who sold an independently exercise the right of repurchase as
immovable alone has left several heirs, in which case regards his own share, and the vendee cannot compel
each of the latter may only redeem the part which he him to redeem the whole property.
may have acquired.
PRE-EMPTION REDEMPTION
Should two or more co-owners desire to exercise the right
(a) arises before sale (a) arises after sale of redemption, they may only do so in proportion to the
(b) no rescission because (b) there can be rescission of share they may respectively have in the thing owned in
no sale as yet exists the original sale common.
(c) the action here is (c) the action here is directed
directed against prospective against the buyer
seller Right of Legal Redemption of Co-Owner
(a) Reason for the law: To minimize co-ownership.
Basis of Legal Redemption (b) Note that for Art. 1620 to apply, the share must
- This right is not predicated on any proprietary right, have been sold to a third person. Hence, if the
which after the sale of the property on execution, leaves purchaser is also a co-owner, there is no legal
the judgment debtor and vests in the purchaser, but on a redemption.
bare statutory privilege to be exercised only by the persons
named in the statute. Who Can Exercise the Right of Legal Redemption
(a) The right of legal redemption lies in all co-
Property Affected tenants of the things held in common.
- Legal redemption can be effected against either (b) This right is granted not only to the original co-
movable or immovable property. owners but applies to all those who subsequently
acquire their respective shares while the community
subsists.
Federis v. Sunga
- If property has been partitioned, a former co-heir or
co-owner has no right of redemption or pre-emption
and cannot complain that he was not served notice
of the disposition of the property.
Note: Mariano v. CA
- The right of legal redemption is SUBSTANTIVE. - In the absence of a written notification of the sale by
- The periods given in the law are conditions the vendor, the 30-day period cannot be said to have
precedent, and not periods of prescription. The even begun to run. Thus, respondents have not lost
offer to exercise the right of redemption must be their right to redeem.
within the period stipulated by the law, for said
periods are requisites for the legal and effective Chapter 8
exercise of the right. ASSIGNMENT OF CREDITS AND OTHER INCORPOREAL
RIGHTS
Doromal v. Court of Appeals
- The 30-day notice in writing referred to in Art. 1623 Article 1624. An assignment of credits and other
should be counted from notice, not of the perfected incorporeal rights shall be perfected in accordance with
sale, but of the actual execution and delivery of the the provisions of Article 1475.
document of sale.
Effectivity Against Third Persons South City Homes, Inc., Fortune Motors (Phils.),
(a) if personal property is involved — a public Palawan Lumber Manufacturing Corp. v. BA
instrument is needed to make the assignment Finance Corp.
effective against third persons. - In an assignment, the debtor’s consent is not
(b) if real property is involved –– registration in the essential for the validity of the assignment his
Registry of Property would be needed. knowledge thereof affecting only the validity of the
payment he might make.
Mortgage
- A mortgage that is assigned is valid between the Article 1627. The assignment of a credit includes all the
parties even if the assignment is not registered, accessory rights, such as a guaranty, mortgage, pledge
because registration is only essential to prejudice or preference.
third parties. (Villanueua v. Perez, et al., 928).
Rights Included in the Assignment of a Credit
Gratuitous Assignments Accessory rights are included such as:
- A gratuitous assignment is a DONATION and must (a) guaranty,
therefore comply with the formalities of a donation. (b) mortgage,
(c) pledge,
Article 1626. The debtor who, before having knowledge (d) preference.
of the assignment, pays his creditor shall be released
from the obligation.
Even in these cases he shall only be liable for the price If the credit should be payable within a term or period
received and for the expenses specified in No. 1 of Article which has not yet expired, the liability shall cease one
1616. The vendor in bad faith shall always be year after the maturity.
answerable for the payment of all expenses, and for
damages. Duration of the Warranty for the Debtor’s
Solvency
Warranties in the Assignment of a Credit (a) time agreed upon
(a) This Article talks of two kinds of warranties: (b) if no time was agreed upon
1) objective — the credit itself (its existence and 1) one year from ASSIGNMENT — if debt was
legality). already due
2) subjective — the person of the debtor (his 2) one year from MATURITY if debt was not yet
solvency). due
(b) This Article also distinguishes between the liabilities of
the seller in good faith and the seller in bad faith. Article 1630. One who sells an inheritance without
enumerating the things of which it is composed, shall
‘Assignment of Credit’ Defined only be answerable for his character as an heir.
- It is the process of transferring the right of the
assignor to the assignee, who would then be allowed Warranty of a Person Who Sells an Inheritance
to proceed against the debtor. It may be done either Without an Enumeration of the Things Included
gratuitously or onerously, in which case, the Therein
assignment has an effect similar to that of a sale. - If there is a sale of an enumerated list of future
inheritance, this is prohibited, as a rule.
- Present inheritance may be sold and this is what the
Article contemplates. Since the sale does not
enumerate the specific things sold, the warranty
only extends to the fact of HEIRSHIP.
Ma. Tiffany T. Cabigon
Bachelor of Laws SALES
University of Negros Occidental-Recoletos Page 89
Sale of Future Inheritance
Article 1633. The vendee shall, on his part, reimburse
- If the future inheritance is sold without specification
the vendor for all that the latter may have paid for the
of properties, this would only be a sale of future
debts of and charges on the estate and satisfy the credits
hereditary rights, and hence, is permissible.
he may have against the same, unless there is an
-
agreement to the contrary.
Article 1631. One who sells for a lump sum the whole of
certain rights, rents, or products, shall comply by Corresponding Duty of a Buyer
answering for the legitimacy of the whole in general; but - The Article is clearly just and fair.
he shall not be obliged to warrant each of the various
parts of which it may be composed, except in the case of
Article 1634. When a credit or other incorporeal right in
eviction from the whole or the part of greater value.
litigation is sold, the debtor shall have a right to
extinguish it by reimbursing the assignee for the price
Sale For a Lump Sum of the Whole of Certain the latter paid therefor, the judicial costs incurred by
Rights, Rents, or Products him, and the interest on the price from the day on which
- The warranty is on the LEGITIMACY of the whole. the same was paid.
(1) To a co-heir or co-owner of the right assigned; Article 1636. In the preceding articles in this Title
governing the sale of goods, unless the context or subject
(2) To a creditor in payment of his credit; matter otherwise requires:
(3) To the possessor of a tenement or piece of land which (1) “Document of title to goods” includes any bill of
is subject to the right in litigation assigned. lading, dock warrant, “quedan,” or warehouse receipt or
order, for the delivery of goods, or any other document
Reason for paragraph 1: used in the ordinary course of business in the sale or
- The law does not favor co-ownership. transfer of goods, as proof of the possession or control of
the goods, or authorizing or purporting to authorize the
Reason for paragraph 2: possessor of the document to transfer or receive, either
- The presumption here that the assignment is above by indorsement or by delivery, goods represented by
suspicion. The assignment here in the form of such document.
“dacio en pago” is, thus, perfectly legal.
“Goods” includes all chattels personal but not things in
Example of paragraph 3: action or money of legal tender in the Philippines. The
- A mortgaged his land to B, but A sold it to C. Later term includes growing fruits or crops.
while suit is pending, C acquires mortgage credit
assigned to him by B. A has no right to redeem the “Order” relating to documents of title means an order by
mortgage credit. This is because C’s purpose is indorsement on the documents.
presumably to preserve the tenement.
“Quality of goods” includes their state or condition.
Republic v. Aquino
- The principal distinction between the Land
Registration Law and the Public Land Law is that in
the first, there is already a title which is to be
confirmed by the first court, while in the second,
there is only an imperfect title (the presumption
Ma. Tiffany T. Cabigon
Bachelor of Laws SALES
University of Negros Occidental-Recoletos Page 92