Source: https://ja.scribd.com/document/127500838/Sales-Codal
Timestamp: 2019-07-19 01:37:52
Document Index: 759915343

Matched Legal Cases: ['Art. 1467', 'Art. 1467', 'Art. 1458', 'Art. 1468', 'Art. 1459', 'Art. 1469', 'Art. 1460', 'Art. 1461', 'Art. 1470', 'Art. 1462', 'Art. 1471', 'Art. 1472', 'Art. 1463', 'Art. 1473', 'Art. 1464', 'Art. 1474', 'Art. 1475', 'Art. 1465', 'Art. 1466', 'Art. 1476', 'Art. 1484', 'Art. 1485', 'Art. 1486', 'Art. 1477', 'Art. 1478', 'Art. 1487', 'Art. 1479', 'Art. 1488', 'Art. 1480', 'Art. 1489', 'Art. 1490', 'Art. 1481', 'Art. 1491', 'Art. 1482', 'Art. 1483', 'Art. 1499', 'Art. 1492', 'Art. 1500', 'Art. 1501', 'Art. 1502', 'Art. 1493', 'Art. 1494', 'Art. 1503', 'Art. 1495', 'Art. 1496', 'Art. 1497', 'Art. 1498', 'Art. 1504', 'Art. 1510', 'Art. 1511', 'Art. 1505', 'Art. 1512', 'Art. 1506', 'Art. 1507', 'Art. 1514', 'Art. 1508', 'Art. 1515', 'Art. 1509', 'Art. 1516', 'Art. 1522', 'Art. 1517', 'Art. 1518', 'Art. 1519', 'Art. 1523', 'Art. 1520', 'Art. 1521', 'Art. 1524', 'Art. 1525', 'Art. 1526', 'Art. 1527', 'Art. 1532', 'Art. 1528', 'Art. 1529', 'Art. 1533', 'Art. 1530', 'Art. 1534', 'Art. 1540', 'Art. 1541', 'Art. 1542', 'Art. 1535', 'Art. 1543', 'Art. 1536', 'Art. 1544', 'Art. 1537', 'Art. 1538', 'Art. 1539', 'Art. 1545', 'Art. 1555', 'Art. 1546', 'Art. 1547', 'Art. 1556', 'Art. 1557', 'Art. 1548', 'Art. 1558', 'Art. 1559', 'Art. 1549', 'Art. 1560', 'Art. 1550', 'Art. 1551', 'Art. 1552', 'Art. 1553', 'Art. 1554', 'Art. 1561', 'Art. 1572', 'Art. 1562', 'Art. 1573', 'Art. 1574', 'Art. 1563', 'Art. 1575', 'Art. 1564', 'Art. 1565', 'Art. 1576', 'Art. 1566', 'Art. 1577', 'Art. 1567', 'Art. 1578', 'Art. 1568', 'Art. 1579', 'Art. 1569', 'Art. 1580', 'Art. 1570', 'Art. 1571', 'Art. 1582', 'Art. 1590', 'Art. 1591', 'Art. 1584', 'Art. 1592', 'Art. 1593', 'Art. 1585', 'Art. 1594', 'Art. 1595', 'Art. 1586', 'Art. 1587', 'Art. 1588', 'Art. 1589', 'Art. 1596', 'Art. 1600', 'Art. 1597', 'Art. 1601', 'Art. 1598', 'Art. 1602', 'Art. 1599', 'Art. 1603', 'Art. 1604', 'Art. 1605', 'Art. 1606', 'Art. 1607', 'Art. 1608', 'Art. 1618', 'Art. 1609', 'Art. 1610', 'Art. 1619', 'Art. 1611', 'Art. 1620', 'Art. 1612', 'Art. 1621', 'Art. 1613', 'Art. 1614', 'Art. 1622', 'Art. 1615', 'Art. 1616', 'Art. 1623', 'Art. 1617', 'Art. 1624', 'Art. 1625', 'Art. 1635', 'Art. 1626', 'Art. 1627', 'Art. 1636', 'Art. 1628', 'Art. 1629', 'Art. 1630', 'Art. 1631', 'Art. 1632', 'Art. 1637', 'Art. 1633', 'Art. 1634']

Sales Codal | Negotiable Instrument | Sales
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UP 2008 Commercial Law (Negotiable Instruments Law).pdf
chan wan vs tan kim
G.R. No. 158262 (Digest)
Case Digests in Negotiable Instruments Law
The Great Eastern Life Insurance Co
Title VI. - SALES Art. 1467.
Art. 1467. A contract for the delivery at a certain price of an article which the vendor in the ordinary course of his
business manufactures or procures for the general market, whether the same is on hand at the time or not, is a
CHAPTER 1 contract of sale, but if the goods are to be manufactured specially for the customer and upon his special order, and
NATURE AND FORM OF THE CONTRACT not for the general market, it is a contract for a piece of work. (n)
Art. 1458. By the contract of sale one of the contracting parties obligates himself to transfer the ownership and to Art. 1468. If the consideration of the contract consists partly in money, and partly in another thing, the transaction
deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent. shall be characterized by the manifest intention of the parties. If such intention does not clearly appear, it shall be
A contract of sale may be absolute or conditional. (1445a) considered a barter if the value of the thing given as a part of the consideration exceeds the amount of the money or
its equivalent; otherwise, it is a sale. (1446a)
Art. 1459. The thing must be licit and the vendor must have a right to transfer the ownership thereof at the time it
is delivered. (n) Art. 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.
Art. 1460. A thing is determinate when it is particularly designated or physical segregated from all other of the
same class. 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.
The requisite that a thing be determinate is satisfied if at the time the contract is entered into, the thing is capable of
being made determinate without the necessity of a new or further agreement between the parties. (n) If the third person or persons acted in bad faith or by mistake, the courts may fix the price.
Art. 1461. Things having a potential existence may be the object of the contract of sale. 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
The efficacy of the sale of a mere hope or expectancy is deemed subject to the condition that the thing will come case may be. (1447a)
Art. 1470. Gross inadequacy of price does not affect a contract of sale, except as it may indicate a defect in the
The sale of a vain hope or expectancy is void. (n) consent, or that the parties really intended a donation or some other act or contract. (n)
Art. 1462. The goods which form the subject of a contract of sale may be either existing goods, owned or Art. 1471. If the price is simulated, the sale is void, but the act may be shown to have been in reality a donation, or
possessed by the seller, or goods to be manufactured, raised, or acquired by the seller after the perfection of the some other act or contract. (n)
contract of sale, in this Title called "future goods."
Art. 1472. The price of securities, grain, liquids, and other things shall also be considered certain, when the price
There may be a contract of sale of goods, whose acquisition by the seller depends upon a contingency which may fixed is that which the thing sold would have on a definite day, or in a particular exchange or market, or when an
or may not happen. (n) amount is fixed above or below the price on such day, or in such exchange or market, provided said amount be
certain. (1448)
Art. 1463. The sole owner of a thing may sell an undivided interest therein. (n)
Art. 1473. The fixing of the price can never be left to the discretion of one of the contracting parties. However, if the
Art. 1464. In the case of fungible goods, there may be a sale of an undivided share of a specific mass, though the price fixed by one of the parties is accepted by the other, the sale is perfected. (1449a)
seller purports to sell and the buyer to buy a definite number, weight or measure of the goods in the mass, and
though the number, weight or measure of the goods in the mass is undetermined. By such a sale the buyer becomes Art. 1474. Where the price cannot be determined in accordance with the preceding articles, or in any other manner,
owner in common of such a share of the mass as the number, weight or measure bought bears to the number, the contract is inefficacious. However, if the thing or any part thereof has been delivered to and appropriated by the
weight or measure of the mass. If the mass contains less than the number, weight or measure bought, the buyer buyer he must pay a reasonable price therefor. What is a reasonable price is a question of fact dependent on the
becomes the owner of the whole mass and the seller is bound to make good the deficiency from goods of the same circumstances of each particular case. (n)
kind and quality, unless a contrary intent appears. (n)
Art. 1475. The contract of sale is perfected at the moment there is a meeting of minds upon the thing which is the
Art. 1465. Things subject to a resolutory condition may be the object of the contract of sale. (n) object of the contract and upon the price.
Art. 1466. In construing a contract containing provisions characteristic of both the contract of sale and of the From that moment, the parties may reciprocally demand performance, subject to the provisions of the law governing
contract of agency to sell, the essential clauses of the whole instrument shall be considered. (n) the form of contracts. (1450a)
Art. 1476. In the case of a sale by auction:
(1) Where goods are put up for sale by auction in lots, each lot is the subject of a separate contract of sale. Art. 1484. In a contract of sale of personal property the price of which is payable in installments, the vendor may
(2) A sale by auction is perfected when the auctioneer announces its perfection by the fall of the hammer, or in exercise any of the following remedies:
other customary manner. Until such announcement is made, any bidder may retract his bid; and the auctioneer may
withdraw the goods from the sale unless the auction has been announced to be without reserve. (1) Exact fulfillment of the obligation, should the vendee fail to pay;
(3) A right to bid may be reserved expressly by or on behalf of the seller, unless otherwise provided by law or by
stipulation. (3) Foreclose the chattel mortgage on the thing sold, if one has been constituted, should the vendee's failure to pay
cover two or more installments. In this case, he shall have no further action against the purchaser to recover any
(4) Where notice has not been given that a sale by auction is subject to a right to bid on behalf of the seller, it shall unpaid balance of the price. Any agreement to the contrary shall be void. (1454-A-a)
not be lawful for the seller to bid himself or to employ or induce any person to bid at such sale on his behalf or for
the auctioneer, to employ or induce any person to bid at such sale on behalf of the seller or knowingly to take any Art. 1485. The preceding article shall be applied to contracts purporting to be leases of personal property with
bid from the seller or any person employed by him. Any sale contravening this rule may be treated as fraudulent by option to buy, when the lessor has deprived the lessee of the possession or enjoyment of the thing. (1454-A-a)
the buyer. (n) Art. 1486. In the case referred to in two preceding articles, a stipulation that the installments or rents paid shall not
be returned to the vendee or lessee shall be valid insofar as the same may not be unconscionable under the
Art. 1477. The ownership of the thing sold shall be transferred to the vendee upon the actual or constructive circumstances. (n)
delivery thereof. (n)
Art. 1478. The parties may stipulate that ownership in the thing shall not pass to the purchaser until he has fully Art. 1487. The expenses for the execution and registration of the sale shall be borne by the vendor, unless there is a
paid the price. (n) stipulation to the contrary. (1455a)
Art. 1479. A promise to buy and sell a determinate thing for a price certain is reciprocally demandable. Art. 1488. The expropriation of property for public use is governed by special laws. (1456)
An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding upon the CHAPTER 2
promissor if the promise is supported by a consideration distinct from the price. (1451a) CAPACITY TO BUY OR SELL
Art. 1480. Any injury to or benefit from the thing sold, after the contract has been perfected, from the moment of Art. 1489. All persons who are authorized in this Code to obligate themselves, may enter into a contract of sale,
the perfection of the contract to the time of delivery, shall be governed by Articles 1163 to 1165, and 1262. saving the modifications contained in the following articles.
Where necessaries are those sold and delivered to a minor or other person without capacity to act, he must pay a
This rule shall apply to the sale of fungible things, made independently and for a single price, or without reasonable price therefor. Necessaries are those referred to in Article 290. (1457a)
consideration of their weight, number, or measure.
Art. 1490. The husband and the wife cannot sell property to each other, except:
Should fungible things be sold for a price fixed according to weight, number, or measure, the risk shall not be
imputed to the vendee until they have been weighed, counted, or measured and delivered, unless the latter has (1) When a separation of property was agreed upon in the marriage settlements; or
incurred in delay. (1452a) (2) When there has been a judicial separation or property under Article 191. (1458a)
Art. 1481. In the contract of sale of goods by description or by sample, the contract may be rescinded if the bulk of Art. 1491. The following persons cannot acquire by purchase, even at a public or judicial auction, either in person or
the goods delivered do not correspond with the description or the sample, and if the contract be by sample as well through the mediation of another:
as description, it is not sufficient that the bulk of goods correspond with the sample if they do not also correspond (1) The guardian, the property of the person or persons who may be under his guardianship;
with the description. (2) Agents, the property whose administration or sale may have been entrusted to them, unless the consent of the
principal has been given;
The buyer shall have a reasonable opportunity of comparing the bulk with the description or the sample. (n)
Art. 1482. Whenever earnest money is given in a contract of sale, it shall be considered as part of the price and as
proof of the perfection of the contract. (1454a) (4) Public officers and employees, the property of the State or of any subdivision thereof, or of any government-
owned or controlled corporation, or institution, the administration of which has been intrusted to them; this
Art. 1483. Subject to the provisions of the Statute of Frauds and of any other applicable statute, a contract of sale provision shall apply to judges and government experts who, in any manner whatsoever, take part in the sale;
may be made in writing, or by word of mouth, or partly in writing and partly by word of mouth, or may be inferred
from the conduct of the parties. (n)
(5) Justices, judges, prosecuting attorneys, clerks of superior and inferior courts, and other officers and employees
connected with the administration of justice, the property and rights in litigation or levied upon an execution before With regard to movable property, its delivery may also be made by the delivery of the keys of the place or
the court within whose jurisdiction or territory they exercise their respective functions; this prohibition includes the depository where it is stored or kept. (1463a)
act of acquiring by assignment and shall apply to lawyers, with respect to the property and rights which may be the
object of any litigation in which they may take part by virtue of their profession. Art. 1499. The delivery of movable property may likewise be made by the mere consent or agreement of the
contracting parties, if the thing sold cannot be transferred to the possession of the vendee at the time of the sale, or if
(6) Any others specially disqualified by law. (1459a) the latter already had it in his possession for any other reason. (1463a)
Art. 1492. The prohibitions in the two preceding articles are applicable to sales in legal redemption, compromises Art. 1500. There may also be tradition constitutum possessorium. (n)
and renunciations. (n)
Art. 1501. With respect to incorporeal property, the provisions of the first paragraph of article 1498 shall govern. In
CHAPTER 3 any other case wherein said provisions are not applicable, the placing of the titles of ownership in the possession of
EFFECTS OF THE CONTRACT the vendee or the use by the vendee of his rights, with the vendor's consent, shall be understood as a delivery. (1464)
WHEN THE THING SOLD HAS BEEN LOST
Art. 1502. When goods are delivered to the buyer "on sale or return" to give the buyer an option to return the goods
Art. 1493. If at the time the contract of sale is perfected, the thing which is the object of the contract has been instead of paying the price, the ownership passes to the buyer of delivery, but he may revest the ownership in the
entirely lost, the contract shall be without any effect. seller by returning or tendering the goods within the time fixed in the contract, or, if no time has been fixed, within a
But if the thing should have been lost in part only, the vendee may choose between withdrawing from the contract reasonable time. (n)
and demanding the remaining part, paying its price in proportion to the total sum agreed upon. (1460a)
When goods are delivered to the buyer on approval or on trial or on satisfaction, or other similar terms, the
Art. 1494. Where the parties purport a sale of specific goods, and the goods without the knowledge of the seller ownership therein passes to the buyer:
have perished in part or have wholly or in a material part so deteriorated in quality as to be substantially changed in
character, the buyer may at his option treat the sale: (1) When he signifies his approval or acceptance to the seller or does any other act adopting the transaction;
(2) If he does not signify his approval or acceptance to the seller, but retains the goods without giving notice of
(1) As avoided; or rejection, then if a time has been fixed for the return of the goods, on the expiration of such time, and, if no time has
(2) As valid in all of the existing goods or in so much thereof as have not deteriorated, and as binding the buyer to been fixed, on the expiration of a reasonable time. What is a reasonable time is a question of fact. (n)
pay the agreed price for the goods in which the ownership will pass, if the sale was divisible. (n)
Art. 1503. When there is a contract of sale of specific goods, the seller may, by the terms of the contract, reserve the
right of possession or ownership in the goods until certain conditions have been fulfilled. The right of possession or
CHAPTER 4 ownership may be thus reserved notwithstanding the delivery of the goods to the buyer or to a carrier or other bailee
OBLIGATIONS OF THE VENDOR for the purpose of transmission to the buyer.
Where goods are shipped, and by the bill of lading the goods are deliverable to the seller or his agent, or to the order
SECTION 1. - General Provisions of the seller or of his agent, the seller thereby reserves the ownership in the goods. But, if except for the form of the
bill of lading, the ownership would have passed to the buyer on shipment of the goods, the seller's property in the
Art. 1495. The vendor is bound to transfer the ownership of and deliver, as well as warrant the thing which is the goods shall be deemed to be only for the purpose of securing performance by the buyer of his obligations under the
object of the sale. (1461a) contract.
Art. 1496. The ownership of the thing sold is acquired by the vendee from the moment it is delivered to him in any
of the ways specified in Articles 1497 to 1501, or in any other manner signifying an agreement that the possession Where goods are shipped, and by the bill of lading the goods are deliverable to order of the buyer or of his agent,
is transferred from the vendor to the vendee. (n) but possession of the bill of lading is retained by the seller or his agent, the seller thereby reserves a right to the
possession of the goods as against the buyer.
SECTION 2. - Delivery of the Thing Sold Where the seller of goods draws on the buyer for the price and transmits the bill of exchange and bill of lading
together to the buyer to secure acceptance or payment of the bill of exchange, the buyer is bound to return the bill of
Art. 1497. The thing sold shall be understood as delivered, when it is placed in the control and possession of the lading if he does not honor the bill of exchange, and if he wrongfully retains the bill of lading he acquires no added
vendee. (1462a) right thereby. If, however, the bill of lading provides that the goods are deliverable to the buyer or to the order of the
Art. 1498. When the sale is made through a public instrument, the execution thereof shall be equivalent to the buyer, or is indorsed in blank, or to the buyer by the consignee named therein, one who purchases in good faith, for
delivery of the thing which is the object of the contract, if from the deed the contrary does not appear or cannot value, the bill of lading, or goods from the buyer will obtain the ownership in the goods, although the bill of
exchange has not been honored, provided that such purchaser has received delivery of the bill of lading indorsed person. If indorsed to a specified person, it may be again negotiated by the endorsement of such person in blank, to
by the consignee named therein, or of the goods, without notice of the facts making the transfer wrongful. (n) bearer or to another specified person. Subsequent negotiations may be made in like manner. (n)
Art. 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to Art. 1510. If a document of title which contains an undertaking by a carrier, warehouseman or other bailee to
the buyer, but when the ownership therein is transferred to the buyer the goods are at the buyer's risk whether deliver the goods to bearer, to a specified person or order of a specified person or which contains words of like
actual delivery has been made or not, except that: import, has placed upon it the words "not negotiable," "non-negotiable" or the like, such document may
nevertheless be negotiated by the holder and is a negotiable document of title within the meaning of this Title. But
(1) Where delivery of the goods has been made to the buyer or to a bailee for the buyer, in pursuance of the nothing in this Title contained shall be construed as limiting or defining the effect upon the obligations of the
contract and the ownership in the goods has been retained by the seller merely to secure performance by the buyer carrier, warehouseman, or other bailee issuing a document of title or placing thereon the words "not negotiable,"
of his obligations under the contract, the goods are at the buyer's risk from the time of such delivery; "non-negotiable," or the like. (n)
(2) Where actual delivery has been delayed through the fault of either the buyer or seller the goods are at the risk of
the party in fault. (n) Art. 1511. A document of title which is not in such form that it can be negotiated by delivery may be transferred by
the holder by delivery to a purchaser or donee. A non-negotiable document cannot be negotiated and the
Art. 1505. Subject to the provisions of this Title, where goods are sold by a person who is not the owner thereof, endorsement of such a document gives the transferee no additional right. (n)
and who does not sell them under authority or with the consent of the owner, the buyer acquires no better title to
the goods than the seller had, unless the owner of the goods is by his conduct precluded from denying the seller's Art. 1512. A negotiable document of title may be negotiated:
Nothing in this Title, however, shall affect: (1) By the owner therefor; or
(2) By any person to whom the possession or custody of the document has been entrusted by the owner, if, by the
(1) The provisions of any factors' act, recording laws, or any other provision of law enabling the apparent owner of terms of the document the bailee issuing the document undertakes to deliver the goods to the order of the person to
goods to dispose of them as if he were the true owner thereof; whom the possession or custody of the document has been entrusted, or if at the time of such entrusting the
(2) The validity of any contract of sale under statutory power of sale or under the order of a court of competent document is in such form that it may be negotiated by delivery. (n)
(3) Purchases made in a merchant's store, or in fairs, or markets, in accordance with the Code of Commerce and (1) Such title to the goods as the person negotiating the document to him had or had ability to convey to a purchaser
special laws. (n) in good faith for value and also such title to the goods as the person to whose order the goods were to be delivered
by the terms of the document had or had ability to convey to a purchaser in good faith for value; and
Art. 1506. Where the seller of goods has a voidable title thereto, but his title has not been avoided at the time of the (2) The direct obligation of the bailee issuing the document to hold possession of the goods for him according to the
sale, the buyer acquires a good title to the goods, provided he buys them in good faith, for value, and without terms of the document as fully as if such bailee had contracted directly with him. (n)
notice of the seller's defect of title. (n)
Art. 1507. A document of title in which it is stated that the goods referred to therein will be delivered to the bearer, Art. 1514. A person to whom a document of title has been transferred, but not negotiated, acquires thereby, as
or to the order of any person named in such document is a negotiable document of title. (n) against the transferor, the title to the goods, subject to the terms of any agreement with the transferor.
If the document is non-negotiable, such person also acquires the right to notify the bailee who issued the document
Art. 1508. A negotiable document of title may be negotiated by delivery: of the transfer thereof, and thereby to acquire the direct obligation of such bailee to hold possession of the goods for
him according to the terms of the document.
(1) Where by the terms of the document the carrier, warehouseman or other bailee issuing the same undertakes to
deliver the goods to the bearer; or Prior to the notification to such bailee by the transferor or transferee of a non-negotiable document of title, the title
(2) Where by the terms of the document the carrier, warehouseman or other bailee issuing the same undertakes to of the transferee to the goods and the right to acquire the obligation of such bailee may be defeated by the levy of an
deliver the goods to the order of a specified person, and such person or a subsequent endorsee of the document has attachment of execution upon the goods by a creditor of the transferor, or by a notification to such bailee by the
indorsed it in blank or to the bearer. transferor or a subsequent purchaser from the transfer of a subsequent sale of the goods by the transferor. (n)
Where by the terms of a negotiable document of title the goods are deliverable to bearer or where a negotiable Art. 1515. Where a negotiable document of title is transferred for value by delivery, and the endorsement of the
document of title has been indorsed in blank or to bearer, any holder may indorse the same to himself or to any transferor is essential for negotiation, the transferee acquires a right against the transferor to compel him to endorse
specified person, and in such case the document shall thereafter be negotiated only by the endorsement of such the document unless a contrary intention appears. The negotiation shall take effect as of the time when the
endorsee. (n) endorsement is actually made. (n)
Art. 1509. A negotiable document of title may be negotiated by the endorsement of the person to whose order the
goods are by the terms of the document deliverable. Such endorsement may be in blank, to bearer or to a specified Art. 1516. A person who for value negotiates or transfers a document of title by endorsement or delivery, including
one who assigns for value a claim secured by a document of title unless a contrary intention appears, warrants:
Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state must be borne
(1) That the document is genuine; by the seller. (n)
Art. 1522. Where the seller delivers to the buyer a quantity of goods less than he contracted to sell, the buyer may
(3) That he has knowledge of no fact which would impair the validity or worth of the document; and reject them, but if the buyer accepts or retains the goods so delivered, knowing that the seller is not going to
perform the contract in full, he must pay for them at the contract rate. If, however, the buyer has used or disposed of
(4) That he has a right to transfer the title to the goods and that the goods are merchantable or fit for a particular the goods delivered before he knows that the seller is not going to perform his contract in full, the buyer shall not be
purpose, whenever such warranties would have been implied if the contract of the parties had been to transfer liable for more than the fair value to him of the goods so received.
without a document of title the goods represented thereby. (n)
Where the seller delivers to the buyer a quantity of goods larger than he contracted to sell, the buyer may accept the
Art. 1517. The endorsement of a document of title shall not make the endorser liable for any failure on the part of goods included in the contract and reject the rest. If the buyer accepts the whole of the goods so delivered he must
the bailee who issued the document or previous endorsers thereof to fulfill their respective obligations. (n) pay for them at the contract rate.
Art. 1518. The validity of the negotiation of a negotiable document of title is not impaired by the fact that the
negotiation was a breach of duty on the part of the person making the negotiation, or by the fact that the owner of Where the seller delivers to the buyer the goods he contracted to sell mixed with goods of a different description not
the document was deprived of the possession of the same by loss, theft, fraud, accident, mistake, duress, or included in the contract, the buyer may accept the goods which are in accordance with the contract and reject the
conversion, if the person to whom the document was negotiated or a person to whom the document was rest.
subsequently negotiated paid value therefor in good faith without notice of the breach of duty, or loss, theft, fraud,
accident, mistake, duress or conversion. (n) In the preceding two paragraphs, if the subject matter is indivisible, the buyer may reject the whole of the goods.
Art. 1519. If goods are delivered to a bailee by the owner or by a person whose act in conveying the title to them to The provisions of this article are subject to any usage of trade, special agreement, or course of dealing between the
a purchaser in good faith for value would bind the owner and a negotiable document of title is issued for them they parties. (n)
cannot thereafter, while in possession of such bailee, be attached by garnishment or otherwise or be levied under an
execution unless the document be first surrendered to the bailee or its negotiation enjoined. The bailee shall in no Art. 1523. Where, in pursuance of a contract of sale, the seller is authorized or required to send the goods to the
case be compelled to deliver up the actual possession of the goods until the document is surrendered to him or buyer, delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the
impounded by the court. (n) buyer is deemed to be a delivery of the goods to the buyer, except in the case provided for in Article 1503, first,
second and third paragraphs, or unless a contrary intent appears.
Art. 1520. A creditor whose debtor is the owner of a negotiable document of title shall be entitled to such aid from
courts of appropriate jurisdiction by injunction and otherwise in attaching such document or in satisfying the claim Unless otherwise authorized by the buyer, the seller must make such contract with the carrier on behalf of the buyer
by means thereof as is allowed at law or in equity in regard to property which cannot readily be attached or levied as may be reasonable, having regard to the nature of the goods and the other circumstances of the case. If the seller
upon by ordinary legal process. (n) omit so to do, and the goods are lost or damaged in course of transit, the buyer may decline to treat the delivery to
the carrier as a delivery to himself, or may hold the seller responsible in damages.
Art. 1521. Whether it is for the buyer to take possession of the goods or of the seller to send them to the buyer is a
question depending in each case on the contract, express or implied, between the parties. Apart from any such Unless otherwise agreed, where goods are sent by the seller to the buyer under circumstances in which the seller
contract, express or implied, or usage of trade to the contrary, the place of delivery is the seller's place of business knows or ought to know that it is usual to insure, the seller must give such notice to the buyer as may enable him to
if he has one, and if not his residence; but in case of a contract of sale of specific goods, which to the knowledge of insure them during their transit, and, if the seller fails to do so, the goods shall be deemed to be at his risk during
the parties when the contract or the sale was made were in some other place, then that place is the place of delivery. such transit. (n)
Where by a contract of sale the seller is bound to send the goods to the buyer, but no time for sending them is Art. 1524. The vendor shall not be bound to deliver the thing sold, if the vendee has not paid him the price, or if no
fixed, the seller is bound to send them within a reasonable time. period for the payment has been fixed in the contract. (1466)
Where the goods at the time of sale are in the possession of a third person, the seller has not fulfilled his obligation Art. 1525. The seller of goods is deemed to be an unpaid seller within the meaning of this Title:
to deliver to the buyer unless and until such third person acknowledges to the buyer that he holds the goods on the
buyer's behalf. (1) When the whole of the price has not been paid or tendered;
(2) When a bill of exchange or other negotiable instrument has been received as conditional payment, and the
Demand or tender of delivery may be treated as ineffectual unless made at a reasonable hour. What is a reasonable condition on which it was received has been broken by reason of the dishonor of the instrument, the insolvency of
hour is a question of fact. the buyer, or otherwise.
In Articles 1525 to 1535 the term "seller" includes an agent of the seller to whom the bill of lading has been (1) From the time when they are delivered to a carrier by land, water, or air, or other bailee for the purpose of
indorsed, or a consignor or agent who has himself paid, or is directly responsible for the price, or any other person transmission to the buyer, until the buyer, or his agent in that behalf, takes delivery of them from such carrier or
who is in the position of a seller. (n) other bailee;
Art. 1526. Subject to the provisions of this Title, notwithstanding that the ownership in the goods may have passed (2) If the goods are rejected by the buyer, and the carrier or other bailee continues in possession of them, even if the
to the buyer, the unpaid seller of goods, as such, has: seller has refused to receive them back.
(1) A lien on the goods or right to retain them for the price while he is in possession of them; Goods are no longer in transit within the meaning of the preceding article:
(2) In case of the insolvency of the buyer, a right of stopping the goods in transitu after he has parted with the (1) If the buyer, or his agent in that behalf, obtains delivery of the goods before their arrival at the appointed
possession of them; destination;
(2) If, after the arrival of the goods at the appointed destination, the carrier or other bailee acknowledges to the
(3) A right of resale as limited by this Title; buyer or his agent that he holds the goods on his behalf and continues in possession of them as bailee for the buyer
or his agent; and it is immaterial that further destination for the goods may have been indicated by the buyer;
Where the ownership in the goods has not passed to the buyer, the unpaid seller has, in addition to his other
remedies a right of withholding delivery similar to and coextensive with his rights of lien and stoppage in transitu If the goods are delivered to a ship, freight train, truck, or airplane chartered by the buyer, it is a question depending
where the ownership has passed to the buyer. (n) on the circumstances of the particular case, whether they are in the possession of the carrier as such or as agent of
Art. 1527. Subject to the provisions of this Title, the unpaid seller of goods who is in possession of them is entitled the buyer.
to retain possession of them until payment or tender of the price in the following cases, namely: If part delivery of the goods has been made to the buyer, or his agent in that behalf, the remainder of the goods may
be stopped in transitu, unless such part delivery has been under such circumstances as to show an agreement with
(1) Where the goods have been sold without any stipulation as to credit; the buyer to give up possession of the whole of the goods. (n)
Art. 1532. The unpaid seller may exercise his right of stoppage in transitu either by obtaining actual possession of
(3) Where the buyer becomes insolvent. the goods or by giving notice of his claim to the carrier or other bailee in whose possession the goods are. Such
notice may be given either to the person in actual possession of the goods or to his principal. In the latter case the
The seller may exercise his right of lien notwithstanding that he is in possession of the goods as agent or bailee for notice, to be effectual, must be given at such time and under such circumstances that the principal, by the exercise
the buyer. (n) of reasonable diligence, may prevent a delivery to the buyer.
Art. 1528. Where an unpaid seller has made part delivery of the goods, he may exercise his right of lien on the
remainder, unless such part delivery has been made under such circumstances as to show an intent to waive the lien When notice of stoppage in transitu is given by the seller to the carrier, or other bailee in possession of the goods, he
or right of retention. (n) must redeliver the goods to, or according to the directions of, the seller. The expenses of such delivery must be
borne by the seller. If, however, a negotiable document of title representing the goods has been issued by the carrier
Art. 1529. The unpaid seller of goods loses his lien thereon: or other bailee, he shall not obliged to deliver or justified in delivering the goods to the seller unless such document
is first surrendered for cancellation. (n)
(1) When he delivers the goods to a carrier or other bailee for the purpose of transmission to the buyer without
reserving the ownership in the goods or the right to the possession thereof; Art. 1533. Where the goods are of perishable nature, or where the seller expressly reserves the right of resale in case
(2) When the buyer or his agent lawfully obtains possession of the goods; the buyer should make default, or where the buyer has been in default in the payment of the price for an
unreasonable time, an unpaid seller having a right of lien or having stopped the goods in transitu may resell the
(3) By waiver thereof. goods. He shall not thereafter be liable to the original buyer upon the contract of sale or for any profit made by such
resale, but may recover from the buyer damages for any loss occasioned by the breach of the contract of sale.
The unpaid seller of goods, having a lien thereon, does not lose his lien by reason only that he has obtained
judgment or decree for the price of the goods. (n) Where a resale is made, as authorized in this article, the buyer acquires a good title as against the original buyer.
Art. 1530. Subject to the provisions of this Title, when the buyer of goods is or becomes insolvent, the unpaid
seller who has parted with the possession of the goods has the right of stopping them in transitu, that is to say, he It is not essential to the validity of resale that notice of an intention to resell the goods be given by the seller to the
may resume possession of the goods at any time while they are in transit, and he will then become entitled to the original buyer. But where the right to resell is not based on the perishable nature of the goods or upon an express
same rights in regard to the goods as he would have had if he had never parted with the possession. (n) provision of the contract of sale, the giving or failure to give such notice shall be relevant in any issue involving the
question whether the buyer had been in default for an unreasonable time before the resale was made.
It is not essential to the validity of a resale that notice of the time and place of such resale should be given by the The same shall be done, even when the area is the same, if any part of the immovable is not of the quality specified
seller to the original buyer. in the contract.
The seller is bound to exercise reasonable care and judgment in making a resale, and subject to this requirement The rescission, in this case, shall only take place at the will of the vendee, when the inferior value of the thing sold
may make a resale either by public or private sale. He cannot, however, directly or indirectly buy the goods. (n) exceeds one-tenth of the price agreed upon.
Art. 1534. An unpaid seller having the right of lien or having stopped the goods in transitu, may rescind the Nevertheless, if the vendee would not have bought the immovable had he known of its smaller area of inferior
transfer of title and resume the ownership in the goods, where he expressly reserved the right to do so in case the quality, he may rescind the sale. (1469a)
buyer should make default, or where the buyer has been in default in the payment of the price for an unreasonable
time. The seller shall not thereafter be liable to the buyer upon the contract of sale, but may recover from the buyer Art. 1540. If, in the case of the preceding article, there is a greater area or number in the immovable than that stated
damages for any loss occasioned by the breach of the contract. in the contract, the vendee may accept the area included in the contract and reject the rest. If he accepts the whole
area, he must pay for the same at the contract rate. (1470a)
The transfer of title shall not be held to have been rescinded by an unpaid seller until he has manifested by notice
to the buyer or by some other overt act an intention to rescind. It is not necessary that such overt act should be Art. 1541. The provisions of the two preceding articles shall apply to judicial sales. (n)
communicated to the buyer, but the giving or failure to give notice to the buyer of the intention to rescind shall be
relevant in any issue involving the question whether the buyer had been in default for an unreasonable time before Art. 1542. In the sale of real estate, made for a lump sum and not at the rate of a certain sum for a unit of measure or
the right of rescission was asserted. (n) number, there shall be no increase or decrease of the price, although there be a greater or less area or number than
that stated in the contract.
Art. 1535. Subject to the provisions of this Title, the unpaid seller's right of lien or stoppage in transitu is not
affected by any sale, or other disposition of the goods which the buyer may have made, unless the seller has The same rule shall be applied when two or more immovables as sold for a single price; but if, besides mentioning
assented thereto. the boundaries, which is indispensable in every conveyance of real estate, its area or number should be designated
in the contract, the vendor shall be bound to deliver all that is included within said boundaries, even when it exceeds
If, however, a negotiable document of title has been issued for goods, no seller's lien or right of stoppage in transitu the area or number specified in the contract; and, should he not be able to do so, he shall suffer a reduction in the
shall defeat the right of any purchaser for value in good faith to whom such document has been negotiated, price, in proportion to what is lacking in the area or number, unless the contract is rescinded because the vendee
whether such negotiation be prior or subsequent to the notification to the carrier, or other bailee who issued such does not accede to the failure to deliver what has been stipulated. (1471)
document, of the seller's claim to a lien or right of stoppage in transitu. (n)
Art. 1543. The actions arising from Articles 1539 and 1542 shall prescribe in six months, counted from the day of
Art. 1536. The vendor is not bound to deliver the thing sold in case the vendee should lose the right to make use of delivery. (1472a)
the terms as provided in Article 1198. (1467a)
Art. 1544. If the same thing should have been sold to different vendees, the ownership shall be transferred to the
Art. 1537. The vendor is bound to deliver the thing sold and its accessions and accessories in the condition in person who may have first taken possession thereof in good faith, if it should be movable property.
which they were upon the perfection of the contract.
Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first
All the fruits shall pertain to the vendee from the day on which the contract was perfected. (1468a) recorded it in the Registry of Property.
Art. 1538. In case of loss, deterioration or improvement of the thing before its delivery, the rules in Article 1189 Should there be no inscription, the ownership shall pertain to the person who in good faith was first in the
shall be observed, the vendor being considered the debtor. (n) possession; and, in the absence thereof, to the person who presents the oldest title, provided there is good faith.
Art. 1539. The obligation to deliver the thing sold includes that of placing in the control of the vendee all that is
mentioned in the contract, in conformity with the following rules: SECTION 3. - Conditions and Warranties
If the sale of real estate should be made with a statement of its area, at the rate of a certain price for a unit of Art. 1545. Where the obligation of either party to a contract of sale is subject to any condition which is not
measure or number, the vendor shall be obliged to deliver to the vendee, if the latter should demand it, all that may performed, such party may refuse to proceed with the contract or he may waive performance of the condition. If the
have been stated in the contract; but, should this be not possible, the vendee may choose between a proportional other party has promised that the condition should happen or be performed, such first mentioned party may also
reduction of the price and the rescission of the contract, provided that, in the latter case, the lack in the area be not treat the nonperformance of the condition as a breach of warranty.
less than one-tenth of that stated. Where the ownership in the thing has not passed, the buyer may treat the fulfillment by the seller of his obligation to
deliver the same as described and as warranted expressly or by implication in the contract of sale as a condition of
the obligation of the buyer to perform his promise to accept and pay for the thing. (n)
Art. 1555. When the warranty has been agreed upon or nothing has been stipulated on this point, in case eviction
Art. 1546. Any affirmation of fact or any promise by the seller relating to the thing is an express warranty if the occurs, the vendee shall have the right to demand of the vendor:
natural tendency of such affirmation or promise is to induce the buyer to purchase the same, and if the buyer
purchase the thing relying thereon. No affirmation of the value of the thing, nor any statement purporting to be a (1) The return of the value which the thing sold had at the time of the eviction, be it greater or less than the price of
statement of the seller's opinion only, shall be construed as a warranty, unless the seller made such affirmation or the sale;
statement as an expert and it was relied upon by the buyer. (n) (2) The income or fruits, if he has been ordered to deliver them to the party who won the suit against him;
(3) The costs of the suit which caused the eviction, and, in a proper case, those of the suit brought against the vendor
Art. 1547. In a contract of sale, unless a contrary intention appears, there is: for the warranty;
(1) An implied warranty on the part of the seller that he has a right to sell the thing at the time when the ownership (5) The damages and interests, and ornamental expenses, if the sale was made in bad faith. (1478)
is to pass, and that the buyer shall from that time have and enjoy the legal and peaceful possession of the thing;
Art. 1556. Should the vendee lose, by reason of the eviction, a part of the thing sold of such importance, in relation
(2) An implied warranty that the thing shall be free from any hidden faults or defects, or any charge or to the whole, that he would not have bought it without said part, he may demand the rescission of the contract; but
encumbrance not declared or known to the buyer. with the obligation to return the thing without other encumbrances that those which it had when he acquired it.
He may exercise this right of action, instead of enforcing the vendor's liability for eviction.
This Article shall not, however, be held to render liable a sheriff, auctioneer, mortgagee, pledgee, or other person
professing to sell by virtue of authority in fact or law, for the sale of a thing in which a third person has a legal or The same rule shall be observed when two or more things have been jointly sold for a lump sum, or for a separate
equitable interest. (n) price for each of them, if it should clearly appear that the vendee would not have purchased one without the other.
(1479a)
SUBSECTION 1. - Warranty in Case of Eviction
Art. 1557. The warranty cannot be enforced until a final judgment has been rendered, whereby the vendee loses the
Art. 1548. Eviction shall take place whenever by a final judgment based on a right prior to the sale or an act thing acquired or a part thereof. (1480)
imputable to the vendor, the vendee is deprived of the whole or of a part of the thing purchased.
The vendor shall answer for the eviction even though nothing has been said in the contract on the subject. Art. 1558. The vendor shall not be obliged to make good the proper warranty, unless he is summoned in the suit for
eviction at the instance of the vendee. (1481a)
Art. 1559. The defendant vendee shall ask, within the time fixed in the Rules of Court for answering the complaint,
Art. 1549. The vendee need not appeal from the decision in order that the vendor may become liable for eviction. that the vendor be made a co-defendant. (1482a)
Art. 1560. If the immovable sold should be encumbered with any non-apparent burden or servitude, not mentioned
Art. 1550. When adverse possession had been commenced before the sale but the prescriptive period is completed in the agreement, of such a nature that it must be presumed that the vendee would not have acquired it had he been
after the transfer, the vendor shall not be liable for eviction. (n) aware thereof, he may ask for the rescission of the contract, unless he should prefer the appropriate indemnity.
Neither right can be exercised if the non-apparent burden or servitude is recorded in the Registry of Property, unless
Art. 1551. If the property is sold for nonpayment of taxes due and not made known to the vendee before the sale, there is an express warranty that the thing is free from all burdens and encumbrances.
the vendor is liable for eviction. (n)
Within one year, to be computed from the execution of the deed, the vendee may bring the action for rescission, or
Art. 1552. The judgment debtor is also responsible for eviction in judicial sales, unless it is otherwise decreed in sue for damages.
the judgment. (n)
One year having elapsed, he may only bring an action for damages within an equal period, to be counted from the
Art. 1553. Any stipulation exempting the vendor from the obligation to answer for eviction shall be void, if he date on which he discovered the burden or servitude. (1483a)
pacted in bad faith. (1476)
SUBSECTION 2. - Warranty Against Hidden Defects of or Encumbrances Upon the Thing Sold
Art. 1554. If the vendee has renounced the right to warranty in case of eviction, and eviction should take place, the
vendor shall only pay the value which the thing sold had at the time of the eviction. Should the vendee have made Art. 1561. The vendor shall be responsible for warranty against the hidden defects which the thing sold may have,
the waiver with knowledge of the risks of eviction and assumed its consequences, the vendor shall not be liable. should they render it unfit for the use for which it is intended, or should they diminish its fitness for such use to such
(1477) an extent that, had the vendee been aware thereof, he would not have acquired it or would have given a lower price
for it; but said vendor shall not be answerable for patent defects or those which may be visible, or for those which
are not visible if the vendee is an expert who, by reason of his trade or profession, should have known them. Art. 1572. If two or more animals are sold together, whether for a lump sum or for a separate price for each of them,
(1484a) the redhibitory defect of one shall only give rise to its redhibition, and not that of the others; unless it should appear
that the vendee would not have purchased the sound animal or animals without the defective one.
Art. 1562. In a sale of goods, there is an implied warranty or condition as to the quality or fitness of the goods, as
follows: The latter case shall be presumed when a team, yoke pair, or set is bought, even if a separate price has been fixed for
each one of the animals composing the same. (1491)
(1) Where the buyer, expressly or by implication, makes known to the seller the particular purpose for which the
goods are acquired, and it appears that the buyer relies on the seller's skill or judgment (whether he be the grower Art. 1573. The provisions of the preceding article with respect to the sale of animals shall in like manner be
or manufacturer or not), there is an implied warranty that the goods shall be reasonably fit for such purpose; applicable to the sale of other things. (1492)
(2) Where the goods are brought by description from a seller who deals in goods of that description (whether he be Art. 1574. There is no warranty against hidden defects of animals sold at fairs or at public auctions, or of live stock
the grower or manufacturer or not), there is an implied warranty that the goods shall be of merchantable quality. (n) sold as condemned. (1493a)
Art. 1563. In the case of contract of sale of a specified article under its patent or other trade name, there is no Art. 1575. The sale of animals suffering from contagious diseases shall be void.
warranty as to its fitness for any particular purpose, unless there is a stipulation to the contrary. (n)
Art. 1564. An implied warranty or condition as to the quality or fitness for a particular purpose may be annexed by A contract of sale of animals shall also be void if the use or service for which they are acquired has been stated in
the usage of trade. (n) the contract, and they are found to be unfit therefor. (1494a)
Art. 1565. In the case of a contract of sale by sample, if the seller is a dealer in goods of that kind, there is an Art. 1576. If the hidden defect of animals, even in case a professional inspection has been made, should be of such a
implied warranty that the goods shall be free from any defect rendering them unmerchantable which would not be nature that expert knowledge is not sufficient to discover it, the defect shall be considered as redhibitory.
apparent on reasonable examination of the sample. (n)
But if the veterinarian, through ignorance or bad faith should fail to discover or disclose it, he shall be liable for
Art. 1566. The vendor is responsible to the vendee for any hidden faults or defects in the thing sold, even though damages. (1495)
he was not aware thereof.
Art. 1577. The redhibitory action, based on the faults or defects of animals, must be brought within forty days from
This provision shall not apply if the contrary has been stipulated, and the vendor was not aware of the hidden faults the date of their delivery to the vendee.
or defects in the thing sold. (1485)
This action can only be exercised with respect to faults and defects which are determined by law or by local
Art. 1567. In the cases of Articles 1561, 1562, 1564, 1565 and 1566, the vendee may elect between withdrawing customs. (1496a)
from the contract and demanding a proportionate reduction of the price, with damages in either case. (1486a)
Art. 1578. If the animal should die within three days after its purchase, the vendor shall be liable if the disease
Art. 1568. If the thing sold should be lost in consequence of the hidden faults, and the vendor was aware of them, which cause the death existed at the time of the contract. (1497a)
he shall bear the loss, and shall be obliged to return the price and refund the expenses of the contract, with
damages. If he was not aware of them, he shall only return the price and interest thereon, and reimburse the Art. 1579. If the sale be rescinded, the animal shall be returned in the condition in which it was sold and delivered,
expenses of the contract which the vendee might have paid. (1487a) the vendee being answerable for any injury due to his negligence, and not arising from the redhibitory fault or
defect. (1498)
Art. 1569. If the thing sold had any hidden fault at the time of the sale, and should thereafter be lost by a fortuitous
event or through the fault of the vendee, the latter may demand of the vendor the price which he paid, less the Art. 1580. In the sale of animals with redhibitory defects, the vendee shall also enjoy the right mentioned in article
value which the thing had when it was lost. 1567; but he must make use thereof within the same period which has been fixed for the exercise of the redhibitory
action. (1499)
Art. 1570. The preceding articles of this Subsection shall be applicable to judicial sales, except that the judgment
debtor shall not be liable for damages. (1489a) CHAPTER 5 - OBLIGATIONS OF THE VENDEE
Art. 1571. Actions arising from the provisions of the preceding ten articles shall be barred after six months, from Art. 1582. The vendee is bound to accept delivery and to pay the price of the thing sold at the time and place
the delivery of the thing sold. (1490) stipulated in the contract.
If the time and place should not have been stipulated, the payment must be made at the time and place of the (1) Should it have been so stipulated;
delivery of the thing sold. (1500a) (2) Should the thing sold and delivered produce fruits or income;
Art. 1590. Should the vendee be disturbed in the possession or ownership of the thing acquired, or should he have
Where there is a contract of sale of goods to be delivered by stated installments, which are to be separately paid reasonable grounds to fear such disturbance, by a vindicatory action or a foreclosure of mortgage, he may suspend
for, and the seller makes defective deliveries in respect of one or more instalments, or the buyer neglects or refuses the payment of the price until the vendor has caused the disturbance or danger to cease, unless the latter gives
without just cause to take delivery of or pay for one more instalments, it depends in each case on the terms of the security for the return of the price in a proper case, or it has been stipulated that, notwithstanding any such
contract and the circumstances of the case, whether the breach of contract is so material as to justify the injured contingency, the vendee shall be bound to make the payment. A mere act of trespass shall not authorize the
party in refusing to proceed further and suing for damages for breach of the entire contract, or whether the breach suspension of the payment of the price. (1502a)
is severable, giving rise to a claim for compensation but not to a right to treat the whole contract as broken. (n) Art. 1591. Should the vendor have reasonable grounds to fear the loss of immovable property sold and its price, he
may immediately sue for the rescission of the sale.
Art. 1584. Where goods are delivered to the buyer, which he has not previously examined, he is not deemed to
have accepted them unless and until he has had a reasonable opportunity of examining them for the purpose of Should such ground not exist, the provisions of Article 1191 shall be observed. (1503)
ascertaining whether they are in conformity with the contract if there is no stipulation to the contrary.
Art. 1592. In the sale of immovable property, even though it may have been stipulated that upon failure to pay the
Unless otherwise agreed, when the seller tenders delivery of goods to the buyer, he is bound, on request, to afford price at the time agreed upon the rescission of the contract shall of right take place, the vendee may pay, even after
the buyer a reasonable opportunity of examining the goods for the purpose of ascertaining whether they are in the expiration of the period, as long as no demand for rescission of the contract has been made upon him either
conformity with the contract. judicially or by a notarial act. After the demand, the court may not grant him a new term. (1504a)
Where goods are delivered to a carrier by the seller, in accordance with an order from or agreement with the buyer, Art. 1593. With respect to movable property, the rescission of the sale shall of right take place in the interest of the
upon the terms that the goods shall not be delivered by the carrier to the buyer until he has paid the price, whether vendor, if the vendee, upon the expiration of the period fixed for the delivery of the thing, should not have appeared
such terms are indicated by marking the goods with the words "collect on delivery," or otherwise, the buyer is not to receive it, or, having appeared, he should not have tendered the price at the same time, unless a longer period has
entitled to examine the goods before the payment of the price, in the absence of agreement or usage of trade been stipulated for its payment. (1505)
permitting such examination. (n)
CHAPTER 6 - ACTIONS FOR BREACH OF CONTRACT OF SALE OF GOODS
Art. 1585. The buyer is deemed to have accepted the goods when he intimates to the seller that he has accepted
them, or when the goods have been delivered to him, and he does any act in relation to them which is inconsistent Art. 1594. Actions for breach of the contract of sale of goods shall be governed particularly by the provisions of this
with the ownership of the seller, or when, after the lapse of a reasonable time, he retains the goods without Chapter, and as to matters not specifically provided for herein, by other applicable provisions of this Title. (n)
intimating to the seller that he has rejected them. (n) Art. 1595. Where, under a contract of sale, the ownership of the goods has passed to the buyer and he wrongfully
neglects or refuses to pay for the goods according to the terms of the contract of sale, the seller may maintain an
Art. 1586. In the absence of express or implied agreement of the parties, acceptance of the goods by the buyer shall action against him for the price of the goods.
not discharge the seller from liability in damages or other legal remedy for breach of any promise or warranty in
the contract of sale. But, if, after acceptance of the goods, the buyer fails to give notice to the seller of the breach in Where, under a contract of sale, the price is payable on a certain day, irrespective of delivery or of transfer of title
any promise of warranty within a reasonable time after the buyer knows, or ought to know of such breach, the and the buyer wrongfully neglects or refuses to pay such price, the seller may maintain an action for the price
seller shall not be liable therefor. (n) although the ownership in the goods has not passed. But it shall be a defense to such an action that the seller at any
time before the judgment in such action has manifested an inability to perform the contract of sale on his part or an
Art. 1587. Unless otherwise agreed, where goods are delivered to the buyer, and he refuses to accept them, having intention not to perform it.
the right so to do, he is not bound to return them to the seller, but it is sufficient if he notifies the seller that he
refuses to accept them. If he voluntarily constitutes himself a depositary thereof, he shall be liable as such. (n) Although the ownership in the goods has not passed, if they cannot readily be resold for a reasonable price, and if
the provisions of article 1596, fourth paragraph, are not applicable, the seller may offer to deliver the goods to the
Art. 1588. If there is no stipulation as specified in the first paragraph of article 1523, when the buyer's refusal to buyer, and, if the buyer refuses to receive them, may notify the buyer that the goods are thereafter held by the seller
accept the goods is without just cause, the title thereto passes to him from the moment they are placed at his as bailee for the buyer. Thereafter the seller may treat the goods as the buyer's and may maintain an action for the
disposal. (n) price. (n)
Art. 1589. The vendee shall owe interest for the period between the delivery of the thing and the payment of the Art. 1596. Where the buyer wrongfully neglects or refuses to accept and pay for the goods, the seller may maintain
price, in the following three cases: an action against him for damages for nonacceptance.
The measure of damages is the estimated loss directly and naturally resulting in the ordinary course of events from Where the buyer is entitled to rescind the sale and elects to do so, if the seller refuses to accept an offer of the buyer
the buyer's breach of contract. to return the goods, the buyer shall thereafter be deemed to hold the goods as bailee for the seller, but subject to a
lien to secure payment of any portion of the price which has been paid, and with the remedies for the enforcement
Where there is an available market for the goods in question, the measure of damages is, in the absence of special of such lien allowed to an unpaid seller by Article 1526.
circumstances showing proximate damage of a different amount, the difference between the contract price and the
market or current price at the time or times when the goods ought to have been accepted, or, if no time was fixed (5) In the case of breach of warranty of quality, such loss, in the absence of special circumstances showing
for acceptance, then at the time of the refusal to accept. proximate damage of a greater amount, is the difference between the value of the goods at the time of delivery to
the buyer and the value they would have had if they had answered to the warranty. (n)
If, while labor or expense of material amount is necessary on the part of the seller to enable him to fulfill his
obligations under the contract of sale, the buyer repudiates the contract or notifies the seller to proceed no further CHAPTER 7 - EXTINGUISHMENT OF SALE
therewith, the buyer shall be liable to the seller for labor performed or expenses made before receiving notice of
the buyer's repudiation or countermand. The profit the seller would have made if the contract or the sale had been Art. 1600. Sales are extinguished by the same causes as all other obligations, by those stated in the preceding
fully performed shall be considered in awarding the damages. (n) articles of this Title, and by conventional or legal redemption. (1506)
Art. 1597. Where the goods have not been delivered to the buyer, and the buyer has repudiated the contract of sale, SECTION 1. - Conventional Redemption
or has manifested his inability to perform his obligations thereunder, or has committed a breach thereof, the seller
may totally rescind the contract of sale by giving notice of his election so to do to the buyer. (n) Art. 1601. Conventional redemption shall take place when the vendor reserves the right to repurchase the thing sold,
with the obligation to comply with the provisions of Article 1616 and other stipulations which may have been
Art. 1598. Where the seller has broken a contract to deliver specific or ascertained goods, a court may, on the agreed upon. (1507)
application of the buyer, direct that the contract shall be performed specifically, without giving the seller the option Art. 1602. The contract shall be presumed to be an equitable mortgage, in any of the following cases:
of retaining the goods on payment of damages. The judgment or decree may be unconditional, or upon such terms
and conditions as to damages, payment of the price and otherwise, as the court may deem just. (n) (1) When the price of a sale with right to repurchase is unusually inadequate;
Art. 1599. Where there is a breach of warranty by the seller, the buyer may, at his election: (3) When upon or after the expiration of the right to repurchase another instrument extending the period of
redemption or granting a new period is executed;
(1) Accept or keep the goods and set up against the seller, the breach of warranty by way of recoupment in (4) When the purchaser retains for himself a part of the purchase price;
diminution or extinction of the price; (5) When the vendor binds himself to pay the taxes on the thing sold;
(2) Accept or keep the goods and maintain an action against the seller for damages for the breach of warranty; (6) In any other case where it may be fairly inferred that the real intention of the parties is that the transaction shall
(3) Refuse to accept the goods, and maintain an action against the seller for damages for the breach of warranty; secure the payment of a debt or the performance of any other obligation.
(4) Rescind the contract of sale and refuse to receive the goods or if the goods have already been received, return
them or offer to return them to the seller and recover the price or any part thereof which has been paid. In any of the foregoing cases, any money, fruits, or other benefit to be received by the vendee as rent or otherwise
shall be considered as interest which shall be subject to the usury laws. (n)
When the buyer has claimed and been granted a remedy in anyone of these ways, no other remedy can thereafter Art. 1603. In case of doubt, a contract purporting to be a sale with right to repurchase shall be construed as an
be granted, without prejudice to the provisions of the second paragraph of Article 1191. equitable mortgage. (n)
Where the goods have been delivered to the buyer, he cannot rescind the sale if he knew of the breach of warranty Art. 1604. The provisions of Article 1602 shall also apply to a contract purporting to be an absolute sale. (n)
when he accepted the goods without protest, or if he fails to notify the seller within a reasonable time of the
election to rescind, or if he fails to return or to offer to return the goods to the seller in substantially as good Art. 1605. In the cases referred to in Articles 1602 and 1604, the apparent vendor may ask for the reformation of the
condition as they were in at the time the ownership was transferred to the buyer. But if deterioration or injury of instrument. (n)
the goods is due to the breach or warranty, such deterioration or injury shall not prevent the buyer from returning
or offering to return the goods to the seller and rescinding the sale. Art. 1606. The right referred to in Article 1601, in the absence of an express agreement, shall last four years from
Where the buyer is entitled to rescind the sale and elects to do so, he shall cease to be liable for the price upon
returning or offering to return the goods. If the price or any part thereof has already been paid, the seller shall be Should there be an agreement, the period cannot exceed ten years.
liable to repay so much thereof as has been paid, concurrently with the return of the goods, or immediately after an
offer to return the goods in exchange for repayment of the price. However, the vendor may still exercise the right to repurchase within thirty days from the time final judgment was
rendered in a civil action on the basis that the contract was a true sale with right to repurchase. (1508a)
Art. 1607. In case of real property, the consolidation of ownership in the vendee by virtue of the failure of the Should there have been no fruits at the time of the sale and some exist at the time of redemption, they shall be
vendor to comply with the provisions of article 1616 shall not be recorded in the Registry of Property without a prorated between the redemptioner and the vendee, giving the latter the part corresponding to the time he possessed
judicial order, after the vendor has been duly heard. (n) the land in the last year, counted from the anniversary of the date of the sale. (1519a)
Art. 1608. The vendor may bring his action against every possessor whose right is derived from the vendee, even if Art. 1618. The vendor who recovers the thing sold shall receive it free from all charges or mortgages constituted by
in the second contract no mention should have been made of the right to repurchase, without prejudice to the the vendee, but he shall respect the leases which the latter may have executed in good faith, and in accordance with
provisions of the Mortgage Law and the Land Registration Law with respect to third persons. (1510) the custom of the place where the land is situated. (1520)
Art. 1609. The vendee is subrogated to the vendor's rights and actions. (1511) SECTION 2. - Legal Redemption
Art. 1610. The creditors of the vendor cannot make use of the right of redemption against the vendee, until after Art. 1619. Legal redemption is the right to be subrogated, upon the same terms and conditions stipulated in the
they have exhausted the property of the vendor. (1512) contract, in the place of one who acquires a thing by purchase or dation in payment, or by any other transaction
whereby ownership is transmitted by onerous title. (1521a)
Art. 1611. In a sale with a right to repurchase, the vendee of a part of an undivided immovable who acquires the Art. 1620. A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-owners
whole thereof in the case of article 498, may compel the vendor to redeem the whole property, if the latter wishes or of any of them, are sold to a third person. If the price of the alienation is grossly excessive, the redemptioner shall
to make use of the right of redemption. (1513) pay only a reasonable one.
Art. 1612. If several persons, jointly and in the same contract, should sell an undivided immovable with a right of Should two or more co-owners desire to exercise the right of redemption, they may only do so in proportion to the
repurchase, none of them may exercise this right for more than his respective share. share they may respectively have in the thing owned in common. (1522a)
The same rule shall apply if the person who sold an immovable alone has left several heirs, in which case each of Art. 1621. The owners of adjoining lands shall also have the right of redemption when a piece of rural land, the area
the latter may only redeem the part which he may have acquired. (1514) of which does not exceed one hectare, is alienated, unless the grantee does not own any rural land.
Art. 1613. In the case of the preceding article, the vendee may demand of all the vendors or co-heirs that they come This right is not applicable to adjacent lands which are separated by brooks, drains, ravines, roads and other
to an agreement upon the purchase of the whole thing sold; and should they fail to do so, the vendee cannot be apparent servitudes for the benefit of other estates.
compelled to consent to a partial redemption. (1515)
If two or more adjoining owners desire to exercise the right of redemption at the same time, the owner of the
Art. 1614. Each one of the co-owners of an undivided immovable who may have sold his share separately, may adjoining land of smaller area shall be preferred; and should both lands have the same area, the one who first
independently exercise the right of repurchase as regards his own share, and the vendee cannot compel him to requested the redemption. (1523a)
redeem the whole property. (1516)
Art. 1622. Whenever a piece of urban land which is so small and so situated that a major portion thereof cannot be
Art. 1615. If the vendee should leave several heirs, the action for redemption cannot be brought against each of used for any practical purpose within a reasonable time, having been bought merely for speculation, is about to be
them except for his own share, whether the thing be undivided, or it has been partitioned among them. re-sold, the owner of any adjoining land has a right of pre-emption at a reasonable price.
But if the inheritance has been divided, and the thing sold has been awarded to one of the heirs, the action for If the re-sale has been perfected, the owner of the adjoining land shall have a right of redemption, also at a
redemption may be instituted against him for the whole. (1517) reasonable price.
Art. 1616. The vendor cannot avail himself of the right of repurchase without returning to the vendee the price of When two or more owners of adjoining lands wish to exercise the right of
the sale, and in addition:
pre-emption or redemption, the owner whose intended use of the land in question appears best justified shall be
(1) The expenses of the contract, and any other legitimate payments made by reason of the sale; preferred. (n)
(2) The necessary and useful expenses made on the thing sold. (1518)
Art. 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty days from the
Art. 1617. If at the time of the execution of the sale there should be on the land, visible or growing fruits, there notice in writing by the prospective vendor, or by the vendor, as the case may be. The deed of sale shall not be
shall be no reimbursement for or prorating of those existing at the time of redemption, if no indemnity was paid by recorded in the Registry of Property, unless accompanied by an affidavit of the vendor that he has given written
the purchaser when the sale was executed. notice thereof to all possible redemptioners.
CHAPTER 8 - ASSIGNMENT OF CREDITS AND OTHER INCORPOREAL RIGHTS A credit or other incorporeal right shall be considered in litigation from the time the complaint concerning the same
Art. 1624. An assignment of creditors and other incorporeal rights shall be perfected in accordance with the
provisions of Article 1475. (n) The debtor may exercise his right within thirty days from the date the assignee demands payment from him. (1535)
Art. 1625. An assignment of a credit, right or action shall produce no effect as against third person, unless it
appears in a public instrument, or the instrument is recorded in the Registry of Property in case the assignment Art. 1635. From the provisions of the preceding article shall be excepted the assignments or sales made:
involves real property. (1526)
(1) To a co-heir or co-owner of the right assigned;
Art. 1626. The debtor who, before having knowledge of the assignment, pays his creditor shall be released from (2) To a creditor in payment of his credit;
the obligation. (1527) (3) To the possessor of a tenement or piece of land which is subject to the right in litigation assigned. (1536)
Art. 1627. The assignment of a credit includes all the accessory rights, such as a guaranty, mortgage, pledge or CHAPTER 9 - GENERAL PROVISIONS
preference. (1528)
Art. 1636. In the preceding articles in this Title governing the sale of goods, unless the context or subject matter
Art. 1628. The vendor in good faith shall be responsible for the existence and legality of the credit at the time of otherwise requires:
the sale, unless it should have been sold as doubtful; but not for the solvency of the debtor, unless it has been so
expressly stipulated or unless the insolvency was prior to the sale and of common knowledge. (1) "Document of title to goods" includes any bill of lading, dock warrant, "quedan," or warehouse receipt or order
for the delivery of goods, or any other document used in the ordinary course of business in the sale or transfer of
Even in these cases he shall only be liable for the price received and for the expenses specified in No. 1 of Article goods, as proof of the possession or control of the goods, or authorizing or purporting to authorize the possessor of
1616. the document to transfer or receive, either by endorsement or by delivery, goods represented by such document.
"Goods" includes all chattels personal but not things in action or money of legal tender in the Philippines. The term
The vendor in bad faith shall always be answerable for the payment of all expenses, and for damages. (1529) includes growing fruits or crops.
Art. 1629. In case the assignor in good faith should have made himself responsible for the solvency of the debtor, "Order" relating to documents of title means an order by endorsement on the documents.
and the contracting parties should not have agreed upon the duration of the liability, it shall last for one year only, "Quality of goods" includes their state or condition.
from the time of the assignment if the period had already expired. "Specific goods" means goods identified and agreed upon at the time a contract of sale is made.
If the credit should be payable within a term or period which has not yet expired, the liability shall cease one year An antecedent or pre-existing claim, whether for money or not, constitutes "value" where goods or documents of
after the maturity. (1530a) title are taken either in satisfaction thereof or as security therefor.
Art. 1630. One who sells an inheritance without enumerating the things of which it is composed, shall only be (2) A person is insolvent within the meaning of this Title who either has ceased to pay his debts in the ordinary
answerable for his character as an heir. (1531) course of business or cannot pay his debts as they become due, whether insolvency proceedings have been
commenced or not.
Art. 1631. One who sells for a lump sum the whole of certain rights, rents, or products, shall comply by answering
for the legitimacy of the whole in general; but he shall not be obliged to warrant each of the various parts of which (3) Goods are in a "deliverable state" within the meaning of this Title when they are in such a state that the buyer
it may be composed, except in the case of eviction from the whole or the part of greater value. (1532a) would, under the contract, be bound to take delivery of them. (n)
Art. 1632. Should the vendor have profited by some of the fruits or received anything from the inheritance sold, he Art. 1637. The provisions of this Title are subject to the rules laid down by the Mortgage Law and the Land
shall pay the vendee thereof, if the contrary has not been stipulated. (1533) Registration Law with regard to immovable property. (1537a)
Art. 1633. The vendee shall, on his part, reimburse the vendor for all that the latter may have paid for the debts of
and charges on the estate and satisfy the credits he may have against the same, unless there is an agreement to the
contrary. (1534)
Art. 1634. When a credit or other incorporeal right in litigation is sold, the debtor shall have a right to extinguish it
by reimbursing the assignee for the price the latter paid therefor, the judicial costs incurred by him, and the interest
on the price from the day on which the same was paid.
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