CAPACITY TO BUY & SELL
ARTICLE 1489. All persons who are authorized in this Code to
obligate themselves, may enter into a contract of sale, 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 reasonable price therefor.
Necessaries are those referred to in article 290. (1457a)
Persons Who May Enter Into a Contract of Sale
As a general rule, all persons, whether natural or juridical, who can bind themselves, have the
legal capacity to buy and sell.
Kinds of Incapacity
Absolute Incapacity
Relative Incapacity
1. Absolute Incapacity pertains to persons who cannot bind themselves
(a)
Minor
(b)
Insane or demented persons
(c)
Deaf-mutes who do not know how to read and write
Contracts entered into by a minor and other incapacitated persons are voidable.
However, where the ***necessaries are sold and delivered to him without the
intervention of the parent or guardian, he must pay a reasonable price therefor. The
contract is therefore valid, but the minor has the right to recover any excess above a
reasonable value paid by him.
*** Necessariesthose things which are needed for sustenance, dwelling, clothing and
medical attendance, in keeping with the financial capacity of the family of the
incapacitated person.
Sale of real property by minors who have already passed the ages of puberty and
adolescence and are now in the adult age, when they pretended to have already reached
their majority, while in fact they have not, is valid, and they cannot be permitted
afterwards to excuse themselves from compliance with the obligations assumed by them
or to seek their annulment. This is in accord with the doctrine of estoppels.
2. Relative Incapacity where it exists only with reference to certain persons or class of
property (Art. 1490-1491). The prohibition extends to sales by virtue of legal redemption,
compromises, and renunciations.
ARTICLE 1490. The husband and the wife cannot sell property to
each other, except:
(1) When a separation of property was agreed upon in the marriage
settlements; or
(2) When there has been a judicial separation of property under article 191.
(1458a)
The Court decided that sale between common law spouses is null and void because Art.
1490 prohibits sales between spouses to prevent the exercise of undue influence by one spouse
over the other, as well as to protect the institution of marriage. The prohibition applies to a
couple living as husband and wife without the benefit of marriage, otherwise, the condition of
those incurred guilt would turn out to be better than those in legal union.
REASON FOR THE RULE
To prevent commission of fraud or prejudice to third persons
To prevent one from unduly influencing the other
To avoid indirect donations
ARTICLE 1491. The following persons cannot acquire by purchase,
even at a public or judicial auction, either in person or through the
mediation of another:
(1) The guardian, the property of the person or persons who may be under
his guardianship;
(2) Agents, the property whose administration or sale may have been
intrusted to them, unless the consent of the principal has been given;
(3) Executors and administrators, the property of the estate under
administration;
(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 provision shall apply to judges and government
experts who, in any manner whatsoever, take part in the sale;
(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 the court within whose jurisdiction or territory
they exercise their respective functions; this prohibition includes the 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;
(6) Any others specially disqualified by law. (1459a)
(a) Guardian as to the property of his ward
(b) Agents as to the property whose administration or sale has been entrusted to them, unless
consent of the principal is given
(c) Executors or administrators as to the state under their administration
(d) Public officers and employees as to the property of the State or any subdivision thereof,
or of the government-owned or controlled corporations, the administration of which is
entrusted to them
Judges and government experts who take part in the sale of the property and rights under
litigation
The prohibition is based on the fiduciary relationship (based on trust), to prevent
fraud and undue and improper influence.
With respect to (b) to (d), the sale shall only be voidable because in such cases only
private interests are affected. The defect can be cured by ratification by the seller.
With respect to (e) and (f), the sale shall be null and void, public interests being
involved therein.
(e) Aliens who are disqualified to purchase private agricultural lands under Art. XII, Secs.
3 and 7 of the Constitution
(f)
Unpaid seller having a right of lien or having stopped the goods in transit
(g) Officer holding the execution or his deputy
ARTICLE 1492. The prohibitions in the two preceding articles are
applicable to sales in legal redemption, compromises and renunciations. (n)
