Sales Notes for Midterm

TITLE VI
SALES

Sources of the Law of Sales:

1. Spanish Civil Code
2. Uniform Sales law adopted in the majority of States in the United States of America
3. Code of Commerce
4. Supreme Court decisions
5. Opinions and comments of commentators
6. Special laws

CHAPTER 1
Nature and Form of the Contract

Article 1458. By the contract of sale one of the contracting parties obligates himself to transfer the ownership and to deliver a
determinate thing, and the other to pay therefore a price certain in money or its equivalent.

A contract of sale may be absolute or conditional. (1445a)

Contract of Sale - is an agreement whereby a party called the seller or vendor obligates himself to deliver and transfer the
ownership of a determinate thing to another party called the buyer or the vendee who in turn obligates himself to pay therefor a
price certain in money or its equivalent to the former

- Requires transfer of ownership

Phases or Stages of a Contract of Sale:

1. Preparation, conception or generation-period of negotiation or bargaining

2. Perfection or birth of the contract
3. Consummation or death-fulfillment or performance of the terms agreed

Characteristics or Features of Contract of Sale:

1. Bilateral- both parties are obliged to perform reciprocal obligations

2. Consensual- perfected by a mere consent
3. Commutative-thing sold is considered the equivalent of the price paid and the price paid is the equivalent of the thing
sold (opposite is aleatory contract)
4. Onerous- thing sold is conveyed in consideration of the purchase price is paid in consideration of the conveyance of the
thing delivered
5. Principal-existence does not depend upon the existence and validity of another contract
6. Nominate- specific name given by law-sale

Perfected contract of sale may either be:

1) Absolute-no condition is imposed and ownership passes to the vendee upon the delivery of the thing subject of the sale
2) Conditional-when it is made subject to a certain contingency, ownership is vest upon happening of the condition;
common form is contract to sell

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Elements of Contract of Sale

a) Essential elements
- Meeting of the minds of the seller and buyer
- Object which certain and determinate
- Price certain (cause or consideration)
b) Natural-those which are inherent in the contract and are deemed to exist in the absence of clear contrary agreement
o Warranty against eviction and
o Warranty against hidden defects

c) Accidental-may or may not exist depending on the stipulations of the parties

Contract to Sell- as a bilateral contract whereby the prospective seller, while expressly reserving the ownership of the subject
property despite delivery thereof to the prospective buyer binds himself to sell the property exclusively to the prospective buyer
upon the fulfillment of the condition agreed upon, that is full payment of the purchase price

Contract of Sale- ownership is vested on the buyer whether or not full payment is made

Distinctions:
Contract of Sale:
Tile over the property passes to the buyer upon the delivery unless there is a contrary agreement
Non-payment of the purchase price is a negative resolutory condition, meaning the sale becomes ineffective
upon the happening of such condition
After the delivery of the object, the seller loses ownership over it, unless the contract is set aside he cannot
recover it
Contract to Sell
Ownership is retained by the seller whether or not there is delivery. Ownership passes to the buyer only upon
full payment of the price
The payment in full is a positive suspensive condition
Whether there is delivery or not, the seller retains ownership of the object

Valid Sale against the Will of the Owner of the Property

1. When property is subjected to expropriation
2. In case of ordinary execution sale under RRC
3. In case of judicial foreclosure
4. In case of extra-judicial foreclosure sale

Article 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)

Object of Contract sale either be: a) things b) rights

Both must be licit or lawful within the commerce of man
Classification of Illicit Things
1. Illicit Per Se-illicit by its nature
2. Illicit per accidens-illegal only because of the law prohibiting it
Transmissible rights-right of usufruct, right of redemption, assignment or sale of credit d) right to inheritance already acquired
Intransmissible rights right of suffrage, marital rights, right of support, right to hold public position

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At the time of the perfection of the contract, the seller need not be the owner of the thing or the right sold. What is important is
that at the time of the delivery he is already the owner of the thing or right

The sale will not be valid if the seller is not the owner of the thing/property at the time of delivery

Article 1460. A thing is determinate when it is particularly designated or physical segregated from all others of the same class.

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)

Object of every contract must be determinate not generic

Article 1461. Things having a potential existence may be the object of the contract of sale.

The efficacy of the sale of a mere hope or expectancy is deemed subject to the condition that the thing will come into existence.

The sale of a vain hope or expectancy is void. (n)

Illustrations of things with potential existence:

1. Future fruits expected to be harvested from existing fruit-bearing trees like mangoes, lanzones, durian
2. Wine expected to be produced from an indicated vineyard
3. All the forthcoming chicks hatched from a particular poultry farm
4. Sugar expected to be harvested from a sugar plantation
5. Expected goodwill of a business enterprise
The sale of mere hope or expectancy is valid if the expected thing did not materialize unless the hope or expectancy is vain, parties
intended that if the hope or expectancy will not materialize, the sale is void

Article 1462. The goods which form the subject of a 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."

There may be a contract of sale of goods, whose acquisition by the seller depends upon a contingency which may or may not
happen. (n)

Goods includes all chattels but not things in action or money of legal tender in the Philippines, includes growing fruits or crops

Kinds of goods:
a) Existing goods owned or possessed by the seller
b) Future goods

Without the delivery of the future goods at the appointed time the sale is void

Article 1463. The sole owner of a thing may sell an undivided interest therein. (n)

Article 1464. In the case of fungible goods, there may be a sale of an undivided share of a specific mass, though the 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, and though the number, weight or measure of the goods in the mass is undetermined. By such
a sale the buyer becomes owner in common of such a share of the mass as the number, weight or measure bought bears to the
number, weight or measure of the mass. If the mass contains less than the number, weight or measure bought, the buyer
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Sales Notes for Midterm

becomes the owner of the whole mass and the seller is bound to make good the deficiency from goods of the same kind and
quality, unless a contrary intent appears. (n)

Fungible goods are those which cannot be used without being consumed.

Article 1465. Things subject to a resolutory condition may be the object of the contract of sale. (n)

Resolutory condition-condition which is uncertain, the happening or fulfillment of which extinguishes a subsisting obligation
while suspensive condition the happening of which causes the obligation to arise

Article 1466. In construing a contract containing provisions characteristic of both the contract of sale and of the contract of
agency to sell, the essential clauses of the whole instrument shall be considered. (n)

If contract happens to have provisions characteristics of both sale and agency, the essential terms and conditions of the entire
document are to be considered to determine whether it is a sale or agency

Distinctions between sale and agency:

Sale:
a) The buyer pays for the price of the goods/property purchased
b) The buyer becomes the owner of the goods/property purchased
c) Buyer cannot return the goods when the sale is defective
d) The seller warrants the goods sold
e) The seller has full freedom to enter into any terms or conditions on the contract of sale
Agency:
a) The agent does not pay for the price, he merely accounts for the proceeds of the sale
b) The agent does not become the owner
c) The agent returns the goods if he was not able to sell the same
d) The agent does not make warranty as long as he acts within his authority and in the name of the principal
e) The agent must follow the instructions of the principal
Primodial Test:intention of the parties perceived from the whole scope

Sale on Consignment: is a sale of goods through a dealer or agency, title to the goods does not pass to the consignee; contract
whereby the goods are received by the consignee for sale, the overprice being his commission, with the obligation to remit
within the period agreed upon the proceeds of the sale, or return the goods if unsold to the consigner

Article 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 contract of sale, but if the
goods are to be manufactured specially for the customer and upon his special order, and not for the general market, it is a
contract for a piece of work. (n)

Distinctions between contract of sale and contract for a piece of work:

Sale-if the article is being manufactured and sold by the vendor in the ordinary course of his business, whether article is
already finished or not
Piece of work-if the article is specifically manufactured and upon the special order of the customer (Massachusetts rule)

Article 1468. If the consideration of the contract consists partly in money, and partly in another thing, the transaction shall be
characterized by the manifest intention of the parties. If such intention does not clearly appear, it shall be 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)

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Sales partly in money and partly in Kind: RULES

1. Determine the intention of the parties
2. If intention could not be determined then consider the value of the thing given as part of the consideration. If the value
of the thing is more than the value of the money-BARTER
If the value of the thing is less than the value of any amount-SALE; if thing and money is the same sale

If local currency exchange for foreign currency-purchase and sale

Local currency exchange with other denominations of the local currency -barter

Article 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.

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.

If the third person or persons acted in bad faith or by mistake, the courts may fix the price.

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 case may be. (1447a)

Unless the price is certain, a contract of sale cannot exist. The certainty of price is an essential element of contract of sale

If no specific purchase price, it is sufficient

1. If it is determinable by making a reference to another thing which is itself certain
2. If the determination is entrusted to the judgment of a specified person or persons
3. By reference to certain fact or facts prime commodities in their prevailing market price
Price based on estimates, the transaction lacks the requisites essential for the perfection of the contract

Article 1470. Gross inadequacy of price does not affect a contract of sale, except as it may indicate a defect in the consent, or that
the parties really intended a donation or some other act or contract. (n)

Inadequacy of price-a price insufficient to satisfy the real or actual price of the object of the sale

Mere inadequacy does not affect the validity of a contract of sale if the parties are in a position to form an independent judgment
concerning the transaction

General rule: gross inadequacy of price does not affect a contract of sale except:
1. If consent is vitiated by VIMFU
2. If the parties intended donation or some other act or contract
3. If the price is so low as to be shocking to the conscience , the sale is set aside

Lesion-contracts entered by legal representatives of incapacitated persons, where there is lesion of more than of the value of
the thing-recissible unless approved by the court

Article 1471. If the price is simulated, the sale is void, but the act may be shown to have been in reality a donation, or some other
act or contract. (n)

Simulated contracts: classified

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Sales Notes for Midterm

a) Absolute-parties do not intend to be bound at all

b) Relative-parties conceal their true agreement

Absolutely simulated contract is void

If merely relative: transaction will be binding upon the parties if it does not prejudice a third person and is not intended for any
purpose contrary to law, morals, good customs, public order or public policy

Article 1472. The price of securities, grain, liquids, and other things shall also be considered certain, when the price fixed is that
which the thing sold would have on a definite day, or in a particular exchange or market, or when an amount is fixed above or
below the price on such day, or in such exchange or market, provided said amount be certain. (1448)

Price of securities, grains, liquids and other things when considered certain:
1. When the price fixed is that which the thing would have on a definite day or in a particular exchange or market
2. When an amount is fixed above or below the price of the day provided said amount be certain

Article 1473. The fixing of the price can never be left to the discretion of one of the contracting parties. However, if the price
fixed by one of the parties is accepted by the other, the sale is perfected. (1449a)

General rule: price of thing subject to sale cannot be fixed unilaterally by one of the parties but if the other party agreed the sale
is perfected provided the other requisites of the contract of sale are present

The owner of the property for sale has the right to quote his own price whether reasonable or unreasonable, it is up to
prospective buyer to reject the price

Article 1474. Where the price cannot be determined in accordance with the preceding articles, or in any other manner, the
contract is inefficacious. However, if the thing or any part thereof has been delivered to and appropriated by the buyer he must
pay a reasonable price therefor. What is a reasonable price is a question of fact dependent on the circumstances of each particular
case. (n)

If price cannot be determined contract is ineeficacious, but if had been appropriated, he is required to pay a reasonable price

Reasonableness of the price is a question of fact

Market value-reasonable sum which a property would command in a fair sale by a man willing but not obliged to sell to another
who is willing but not obliged to buy

Article 1475. The contract of sale is perfected at the moment there is a meeting of minds upon the thing which is the object of
the contract and upon the price.

From that moment, the parties may reciprocally demand performance, subject to the provisions of the law governing the form
of contracts. (1450a)

Upon perfection of the contract, buyer can compel the seller to deliver the thing; however, the seller acquires no real right over
the thing until there is delivery

Contracts shall be obligatory, in whatever form they may have been entered into provided all the essential requisites for their
validity are present, however when the law requires that a contract be in some form in order that it may be valid or enforceable or
that a contract be proved in a certain way that requirement is absolute and indespensable
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Sales Notes for Midterm

Statute of frauds requires that the following contracts of sale must be in writing or evidenced by writing otherwise they cannot be
proved in court:

1. A contract f agreement for sale of real property or of an interest therein

2. Sale of personal property if price is 500 or more

Contract of sale subject to suspensive condition: cannot be perfected until the fulfillment of the condition

Contract through or telegram: is perfected only when the offeror has received or has knowledge of the acceptance made by the
offeree

Article 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.

(2) A sale by auction is perfected when the auctioneer announces its perfection by the fall of the hammer, or in 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.

(3) A right to bid may be reserved expressly by or on behalf of the seller, unless otherwise provided by law or by
stipulation.

(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 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 bid from
the seller or any person employed by him. Any sale contravening this rule may be treated as fraudulent by the buyer.
(n)

Sale by auction generally exercised by the sheriff in case of judicial sales, notaries public are also authorized to sell mortgaged
properties foreclosed extrajudicially

Before the fall of the hammer the bidder may retract bid; the acceptance or assent on the part of the seller is signified by the
knocking of the hammer

The seller may himself bid provided the following conditions are present:

1. The right to bid has been expressly reserved unless prohibited by law or by stipulation
2. Notice is given that the auction sale is subject to a right of the seller to bid or another to bid on behalf of the said seller

Article 1477. The ownership of the thing sold shall be transferred to the vendee upon the actual or constructive delivery thereof.
(n)

Ownership of the thing sold id transferred to the vendee upon the delivery not upon the perfection

Kinds of Delivery

1. Actual or real delivery-the thing is placed in the control and possession of the vendee
2. Constructive or legal deliverydelivery effected by legal formalities or by symbolic tradition
a) Tradicion symbolica-deliver keys
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Sales Notes for Midterm

b) Tradicion instrumental-delivery of the instrument

c) Tradicion longa manu-pointing of the movable thing within sight
d) Tradicion brevi manu-grantees continuation of his possession but now under the title of ownership ex.
Lessee who purchased the property
e) Tradicion constitutum possessorium-opposite of tradicion brevi manu
f) Tradicion by operation of law-delivery of things by operation of law such as intestate succession
g) Quasi tradition- consist in the delivery of incorporeal property rights and credits done

Article 1478. The parties may stipulate that ownership in the thing shall not pass to the purchaser until he has fully paid the price.
(n)

Pactum Reservatiit In Domini-stipulation on transfer of ownership: general rule is that delivery of the thing transfer ownership to
the buyer however the parties may agree that ownership shall remain with the seller until the full payment of the purchase price.
Common on installment plasn-contract to sell

Article 1479. A promise to buy and sell a determinate thing for a price certain is reciprocally demandable.

An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding upon the promisor if the
promise is supported by a consideration distinct from the price. (1451a)

The seller is allowed to withdraw from the promise to buy EXCEPT when the promise is supported by a consideration (OPTION
MONEY) distinct and separate from the purchase price, for this become a binding contract contract of option, which separate
and distinct from a contract of sale

Option contract-a privilege existing in one person which gives him right to buy

Policitacion- is a unilateral promise to buy or sell which is not accepted by the other has not been converted into any contract

Contract to sell-ownership is retained by the seller and is not to pass until full payment of the price, the failure to make such
payment is not breach but simply an event that prevented the obligation of the vendor to convey title from acquiring binding
force

Article 1480. Any injury to or benefit from the thing sold, after the contract has been perfected, from the moment of the
perfection of the contract to the time of delivery, shall be governed by articles 1163 to 1165, and 1262.

This rule shall apply to the sale of fungible things, made independently and for a single price, or without consideration of their
weight, number, or measure.

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 incurred in delay. (1452a)

Every person obliged to give something is obliged to take care of it with the proper diligence of a good father of a family

Creditor has right to the fruits of the thing from the time obligation to deliver arises

If what is to deliver is determinate thing, may compel debtor to make the delivery, if indeterminate ask obligation to be
complied at the expense of the debtor

Obligor delays delivery liable in case of fortuitous event

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Sales Notes for Midterm

Obligation to deliver determinate thing is extinguished if lost without the fault of the debtor before he incurred delay

Consequences of the Loss or Deterioration of the Thing: Rule

1. If the loss incurred before the perfection of the contract will be suffered by the vendor
2. If at the time of perfection, the contract is inexistent because the object did not exist
3. If the loss or deterioration is incurred after the perfection but before the delivery to the vendee the following rules shall
be observed:
a) If the loss due to the fault of the vendor, vendor shall bear the injury
b) If loss is due to the fault of the vendee, the latter shall bear the injury
c) If the obligation consists in the delivery of a determinate thing, the seller shall bear the loss or deterioration if
he was in delay, he assumed the loss or deterioration by stipulation or he promised to deliver the same thing to
two or more persons who do have the same interest over the thing

Effect of Fortuitous event:

after delivery: if no stipulation , the vendee

Before the delivery: after perfection but before the delivery: first theory- vendor shall bear the loss, delivery deemed completed
only after the fungibles have been weighed, counted or measures, the contract is reciprocal; second theory- the vendee bears the
loss and such he must pay the price

Risk of loss is not imputable to the vendee, until the fungibles have been considered delivered to him which is done after they
have been weighed, counted or measured and delivered

Article 1481. In the contract of sale of goods by description or by sample, the contract may be rescinded if the bulk of the goods
delivered do not correspond with the description or the sample, and if the contract be by sample as well as description, it is not
sufficient that the bulk of goods correspond with the sample if they do not also correspond with the description.

The buyer shall have a reasonable opportunity of comparing the bulk with the description or the sample. (n)

Kinds of sale:

1. Sale by description-seller sells things as being certain kind verbally describing and buyers simply relies on the sellers
descriptions of things, if the bulk of the goods delivered do not match with descriptions, the contract may be rescinded
2. Sale by sample-where the seller warrants the bulk of goods being sold correspond with the sample or samples exhibited
not only in kind also in quality and character, there is warranty that the bulk of the commodity will correspond
3. Sale by description and sample-satisfy the requirements of both

Bulk of goods here refers to the whole of the goods not just major portion

Article 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)

Earnest Money or Arras-money given to the seller by the prospective buyer to show that the latter is truly interested in buying
the property, and its aim is to bind the bargain, considered part of the purchase price and proof of the perfection of the contract,
advance payment, if the sale did not push through, the earnest money delivered to the seller must be returned

Distinctions between earnest money and option money

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Sales Notes for Midterm

Earnest money:

1. It is part of the purchase price

2. Given only when there is already a perfected sale
3. When it is given the buyer is bound to pay the balance of the agreed purchase price
4. If the sale does not materialize the earnest money paid must be returned unless a contrary agreement had been
stipulated

Option Money
1. It is given as a distant consideration for an option contract which gives the buyer a specific period within which
to purchase the thing
2. It is given at a time when the sale had not been perfected, what had been perfected only is the option
3. Even if option money is paid by the would be buyer, he is not bound to buy the thing
4. If the buyer decides not to buy the thing he cannot recover the option money he paid as consideration for the
contract of option

Article 1483. Subject to the provisions of the Statute of Frauds and of any other applicable statute, a contract of 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)

A contract of sale is a consensual contract which means it can be perfected by mere consent, generally contracts shall be
obligatory in any form they are entered provided all the essential elements for their validity are present.

Sale of real property through an agent-in writing otherwise it is void, in writing to be enforced in court under statute of frauds

Under statute of frauds has to be in writing to be enforced by action:

1. Sale of real property

2. Sale of personal property in an amount of 500 pesos
3. Future sale of property not executed within one year

Authority of the agent has to be in writing otherwise sale is void

Effect of false notarization or expiration of commission of notary public-does not affect the validity of the sale

Statute of frauds purpose is to prevent fraud perjury in the enforcement of obligations depending for their evidence, applies in
cases for specific performance and for damages based on breach of contract

Article 1484. In a contract of sale of personal property the price of which is payable in installments, the vendor may exercise any
of the following remedies:

(1) Exact fulfillment of the obligation, should the vendee fail to pay;

(2) Cancel the sale, should the vendee's failure to pay cover two or more installments;

(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 unpaid
balance of the price. Any agreement to the contrary shall be void. (1454-A-a)

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Sales Notes for Midterm

Nature of the remedies is alternative and not cumulative,if creditor chooses one remedy, he cannot avail himself of the other
two

Recto law-remedy for installment-Maceda law for Real property

Actual foreclosure necessary to bar vendor from recovering the unpaid balance. If the car was surrendered but the mortgaged was
not forclosed, the obligation to pay the balance is not extinguished

Article 1485. The preceding article shall be applied to contracts purporting to be leases of personal property with option to buy,
when the lessor has deprived the lessee of the possession or enjoyment of the thing. (1454-A-a)

Article 1486. In the case referred to in the 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 circumstances. (n)

In case of rescission or cancellation of sale or lease, the general rule is that parties shall make mutual restitution for what they had
received from each other

Article 1487. The expenses for the execution and registration of the sale shall be borne by the vendor, unless there is a stipulation
to the contrary. (1455a)

Expenses includes preparation and notarial fees and expenses of registration such as documentary stamps, capital gains tax, seller
bears the expenses

Article 1488. The expropriation of property for public use is governed by special laws. (1456)

Requisites for valid expropriation:

1. Private property as the subject of expropriation

2. The property is taken by the stae or by a competent authority
3. The purpose of the taking is for public use
4. The taking must be attended with due process of law
5. There is payment of just compensation

CHAPTER 2
Capacity to Buy or 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)

A person has both juridical capacity and capacity to act is said to have full civil capacity

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Kinds of incapacity

1. Absolute incapacity

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)

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)

Article 1492. The prohibitions in the two preceding articles are applicable to sales in legal redemption, compromises and
renunciations. (n)

CHAPTER 3
Effects of the Contract When the Thing Sold Has Been Lost

Article 1493. If at the time the contract of sale is perfected, the thing which is the object of the contract has been entirely lost,
the contract shall be without any effect.

But if the thing should have been lost in part only, the vendee may choose between withdrawing from the contract and
demanding the remaining part, paying its price in proportion to the total sum agreed upon. (1460a)

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Sales Notes for Midterm

Article 1494. Where the parties purport a sale of specific goods, and the goods without the knowledge of the seller 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) As avoided; or

(2) As valid in all of the existing goods or in so much thereof as have not deteriorated, and as binding the buyer to pay
the agreed price for the goods in which the ownership will pass, if the sale was divisible. (n)

CHAPTER 4
Obligations of the Vendor

SECTION 1
General Provisions

Article 1495. The vendor is bound to transfer the ownership of and deliver, as well as warrant the thing which is the object of the
sale. (1461a)

Article 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 is transferred from the
vendor to the vendee. (n)

SECTION 2
Delivery of the Thing Sold

Article 1497. The thing sold shall be understood as delivered, when it is placed in the control and possession of the vendee.
(1462a)

Article 1498. When the sale is made through a public instrument, the execution thereof shall be equivalent to the delivery of the
thing which is the object of the contract, if from the deed the contrary does not appear or cannot clearly be inferred.

With regard to movable property, its delivery may also be made by the delivery of the keys of the place or depository where it is
stored or kept. (1463a)

Article 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 the latter already had it
in his possession for any other reason. (1463a)

Article 1500. There may also be tradition constitutum possessorium. (n)

Article 1501. With respect to incorporeal property, the provisions of the first paragraph of article 1498 shall govern. In any other
case wherein said provisions are not applicable, the placing of the titles of ownership in the possession of the vendee or the use by
the vendee of his rights, with the vendor's consent, shall be understood as a delivery. (1464)
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Sales Notes for Midterm

Article 1502. When goods are delivered to the buyer "on sale or return" to give the buyer an option to return the goods instead
of paying the price, the ownership passes to the buyer on delivery, but he may revest the ownership in the seller by returning or
tendering the goods within the time fixed in the contract, or, if no time has been fixed, within a reasonable time. (n)

When goods are delivered to the buyer on approval or on trial or on satisfaction, or other similar terms, the ownership therein
passes to the buyer:

(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
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
been fixed, on the expiration of a reasonable time. What is a reasonable time is a question of fact. (n)

Article 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 ownership may be
thus reserved notwithstanding the delivery of the goods to the buyer or to a carrier or other bailee 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 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 goods shall be deemed to be
only for the purpose of securing performance by the buyer of his obligations under the contract.

Where goods are shipped, and by the bill of lading the goods are deliverable to order of the buyer or of his agent, 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.

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 lading if he does not
honor the bill of exchange, and if he wrongfully retains the bill of lading he acquires no added right thereby. If, however, the bill
of lading provides that the goods are deliverable to the buyer or to the order of the buyer, or is indorsed in blank, or to the buyer
by the consignee named therein, one who purchases in good faith, for 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 by the consignee named therein, or of the goods, without notice of the facts
making the transfer wrongful. (n)

Article 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to the buyer,
but when the ownership therein is transferred to the buyer the goods are at the buyer's risk whether actual delivery has been
made or not, except that:

(1) Where delivery of the goods has been made to the buyer or to a bailee for the buyer, in pursuance of the contract
and the ownership in the goods has been retained by the seller merely to secure performance by the buyer of his
obligations under the contract, the goods are at the buyer's risk from the time of such delivery;

(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)

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Sales Notes for Midterm

Article 1505. Subject to the provisions of this Title, where goods are sold by a person who is not the owner thereof, 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 authority to sell.

Nothing in this Title, however, shall affect:

(1) The provisions of any factors' act, recording laws, or any other provision of law enabling the apparent owner of
goods to dispose of them as if he were the true owner thereof;

(2) The validity of any contract of sale under statutory power of sale or under the order of a court of competent
jurisdiction;

(3) Purchases made in a merchant's store, or in fairs, or markets, in accordance with the Code of Commerce and special
laws. (n)

Article 1506. Where the seller of goods has a voidable title thereto, but his title has not been avoided at the time of the sale, the
buyer acquires a good title to the goods, provided he buys them in good faith, for value, and without notice of the seller's defect
of title. (n)

Article 1507. A document of title in which it is stated that the goods referred to therein will be delivered to the bearer, or to the
order of any person named in such document is a negotiable document of title. (n)

Article 1508. A negotiable document of title may be negotiated by delivery:

(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

(2) Where by the terms of the document the carrier, warehouseman or other bailee issuing the same undertakes to
deliver the goods to the order of a specified person, and such person or a subsequent indorsee of the document has
indorsed it in blank or to the bearer.

Where by the terms of a negotiable document of title the goods are deliverable to bearer or where a negotiable
document of title has been indorsed in blank or to bearer, any holder may indorse the same to himself or to any
specified person, and in such case the document shall thereafter be negotiated only by the indorsement of such indorsee.
(n)

Article 1509. A negotiable document of title may be negotiated by the indorsement of the person to whose order the goods are
by the terms of the document deliverable. Such indorsement may be in blank, to bearer or to a specified person. If indorsed to a
specified person, it may be again negotiated by the indorsement of such person in blank, to bearer or to another specified person.
Subsequent negotiations may be made in like manner. (n)

Article 1510. If a document of title which contains an undertaking by a carrier, warehouseman or other bailee to deliver the
goods to bearer, to a specified person or order of a specified person or which contains words of like 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 nothing in this Title contained shall be construed as limiting
or defining the effect upon the obligations of the carrier, warehouseman, or other bailee issuing a document of title or placing
thereon the words "not negotiable," "non-negotiable," or the like. (n)

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Sales Notes for Midterm

Article 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 indorsement of such a
document gives the transferee no additional right. (n)

Article 1512. A negotiable document of title may be negotiated:

(1) By the owner thereof; or

(2) By any person to whom the possession or custody of the document has been entrusted by the owner, if, by the
terms of the document the bailee issuing the document undertakes to deliver the goods to the order of the person to
whom the possession or custody of the document has been entrusted, or if at the time of such entrusting the document
is in such form that it may be negotiated by delivery. (n)

Article 1513. A person to whom a negotiable document of title has been duly negotiated acquires thereby:

(1) Such title to the goods as the person negotiating the document to him had or had ability to convey to a purchaser 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

(2) The direct obligation of the bailee issuing the document to hold possession of the goods for him according to the
terms of the document as fully as if such bailee had contracted directly with him. (n)

Article 1514. A person to whom a document of title has been transferred, but not negotiated, acquires thereby, as 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 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.

Prior to the notification to such bailee by the transferor or transferee of a non-negotiable document of title, the title of the
transferee to the goods and the right to acquire the obligation of such bailee may be defeated by the levy of an attachment of
execution upon the goods by a creditor of the transferor, or by a notification to such bailee by the transferor or a subsequent
purchaser from the transferor of a subsequent sale of the goods by the transferor. (n)

Article 1515. Where a negotiable document of title is transferred for value by delivery, and the indorsement of the transferor is
essential for negotiation, the transferee acquires a right against the transferor to compel him to indorse the document unless a
contrary intention appears. The negotiation shall take effect as of the time when the indorsement is actually made. (n)

Article 1516. A person who for value negotiates or transfers a document of title by indorsement or delivery, including one who
assigns for value a claim secured by a document of title unless a contrary intention appears, warrants:

(1) That the document is genuine;

(2) That he has a legal right to negotiate or transfer it;

(3) That he has knowledge of no fact which would impair the validity or worth of the document; and

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Sales Notes for Midterm

(4) That he has a right to transfer the title to the goods and that the goods are merchantable or fit for a particular
purpose, whenever such warranties would have been implied if the contract of the parties had been to transfer without a
document of title the goods represented thereby. (n)

Article 1517. The indorsement of a document of title shall not make the indorser liable for any failure on the part of the bailee
who issued the document or previous indorsers thereof to fulfill their respective obligations. (n)

Article 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 the document was deprived
of the possession of the same by loss, theft, fraud, accident, mistake, duress, or conversion, if the person to whom the document
was negotiated or a person to whom the document was 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)

Article 1519. If goods are delivered to a bailee by the owner or by a person whose act in conveying the title to them to a
purchaser in good faith for value would bind the owner and a negotiable document of title is issued for them they 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 case be compelled to deliver up the
actual possession of the goods until the document is surrendered to him or impounded by the court. (n)

Article 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 by means thereof as is
allowed at law or in equity in regard to property which cannot readily be attached or levied upon by ordinary legal process. (n)

Article 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 contract, express or implied,
or usage of trade to the contrary, the place of delivery is the seller's place of business 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 the parties when the contract or the sale was made were in
some other place, then that place is the place of delivery.

Where by a contract of sale the seller is bound to send the goods to the buyer, but no time for sending them is fixed, the seller is
bound to send them within a reasonable time.

Where the goods at the time of sale are in the possession of a third person, the seller has not fulfilled his obligation 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.

Demand or tender of delivery may be treated as ineffectual unless made at a reasonable hour. What is a reasonable hour is a
question of fact.

Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state must be borne by the seller.
(n)

Article 1522. Where the seller delivers to the buyer a quantity of goods less than he contracted to sell, the buyer may 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 the goods delivered before he
knows that the seller is not going to perform his contract in full, the buyer shall not be liable for more than the fair value to him
of the goods so received.

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Sales Notes for Midterm

Where the seller delivers to the buyer a quantity of goods larger than he contracted to sell, the buyer may accept the goods
included in the contract and reject the rest. If the buyer accepts the whole of the goods so delivered he must pay for them at the
contract rate.

Where the seller delivers to the buyer the goods he contracted to sell mixed with goods of a different description not included in
the contract, the buyer may accept the goods which are in accordance with the contract and reject the rest.

In the preceding two paragraphs, if the subject matter is indivisible, the buyer may reject the whole of the goods.

The provisions of this article are subject to any usage of trade, special agreement, or course of dealing between the parties. (n)

Article 1523. Where, in pursuance of a contract of sale, the seller is authorized or required to send the goods to the buyer,
delivery of the goods to a carrier, whether named by the buyer or not, for the purpose of transmission to the buyer is deemed to
be a delivery of the goods to the buyer, except in the cases provided for in article 1503, first, second and third paragraphs, or
unless a contrary intent appears.

Unless otherwise authorized by the buyer, the seller must make such contract with the carrier on behalf of the buyer as may be
reasonable, having regard to the nature of the goods and the other circumstances of the case. If the seller 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.

Unless otherwise agreed, where goods are sent by the seller to the buyer under circumstances in which the seller 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 insure them during their
transit, and, if the seller fails to do so, the goods shall be deemed to be at his risk during such transit. (n)

Article 1524. The vendor shall not be bound to deliver the thing sold, if the vendee has not paid him the price, or if no period for
the payment has been fixed in the contract. (1466)

Article 1525. The seller of goods is deemed to be an unpaid seller within the meaning of this Title:

(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
condition on which it was received has been broken by reason of the dishonor of the instrument, the insolvency of 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 indorsed, or a
consignor or agent who has himself paid, or is directly responsible for the price, or any other person who is in the position of a
seller. (n)

Article 1526. Subject to the provisions of this Title, notwithstanding that the ownership in the goods may have passed to the
buyer, the unpaid seller of goods, as such, has:

(1) A lien on the goods or right to retain them for the price while he is in possession of them;

(2) In case of the insolvency of the buyer, a right of stopping the goods in transitu after he has parted with the
possession of them;

(3) A right of resale as limited by this Title;

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Sales Notes for Midterm

(4) A right to rescind the sale as likewise limited by this Title.

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 where the ownership has passed to
the buyer. (n)

Article 1527. Subject to the provisions of this Title, the unpaid seller of goods who is in possession of them is entitled to retain
possession of them until payment or tender of the price in the following cases, namely:

(1) Where the goods have been sold without any stipulation as to credit;

(2) Where the goods have been sold on credit, but the term of credit has expired;

(3) Where the buyer becomes insolvent.

The seller may exercise his right of lien notwithstanding that he is in possession of the goods as agent or bailee for the buyer. (n)

Article 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 or right of retention. (n)

Article 1529. The unpaid seller of goods loses his lien thereon:

(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;

(2) When the buyer or his agent lawfully obtains possession of the goods;

(3) By waiver thereof.

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)

Article 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 may resume possession of the
goods at any time while they are in transit, and he will then become entitled to the same rights in regard to the goods as he
would have had if he had never parted with the possession. (n)

Article 1531. Goods are in transit within the meaning of the preceding article:

(1) From the time when they are delivered to a carrier by land, water, or air, or other bailee for the purpose of
transmission to the buyer, until the buyer, or his agent in that behalf, takes delivery of them from such carrier or other
bailee;

(2) If the goods are rejected by the buyer, and the carrier or other bailee continues in possession of them, even if the
seller has refused to receive them back.

Goods are no longer in transit within the meaning of the preceding article:

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Sales Notes for Midterm

(1) If the buyer, or his agent in that behalf, obtains delivery of the goods before their arrival at the appointed
destination;

(2) If, after the arrival of the goods at the appointed destination, the carrier or other bailee acknowledges to the 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;

(3) If the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent in that behalf.

If the goods are delivered to a ship, freight train, truck, or airplane chartered by the buyer, it is a question depending on
the circumstances of the particular case, whether they are in the possession of the carrier as such or as agent of the buyer.

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 the buyer to give up
possession of the whole of the goods. (n)

Article 1532. The unpaid seller may exercise his right of stoppage in transitu either by obtaining actual possession of 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 notice, to be effectual, must be given at such
time and under such circumstances that the principal, by the exercise of reasonable diligence, may prevent a delivery to the buyer.

When notice of stoppage in transitu is given by the seller to the carrier, or other bailee in possession of the goods, he 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 or other bailee, he shall not be
obliged to deliver or justified in delivering the goods to the seller unless such document is first surrendered for cancellation. (n)

Article 1533. Where the goods are of perishable nature, or where the seller expressly reserves the right of resale in case 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 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.

Where a resale is made, as authorized in this article, the buyer acquires a good title as against the original buyer.

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 original
buyer. But where the right to resell is not based on the perishable nature of the goods or upon an express 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 seller to the
original buyer.

The seller is bound to exercise reasonable care and judgment in making a resale, and subject to this requirement may make a
resale either by public or private sale. He cannot, however, directly or indirectly buy the goods. (n)

Article 1534. An unpaid seller having the right of lien or having stopped the goods in transitu, may rescind the transfer of title
and resume the ownership in the goods, where he expressly reserved the right to do so in case the 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

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Sales Notes for Midterm

to the buyer upon the contract of sale, but may recover from the buyer damages for any loss occasioned by the breach of the
contract.

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 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 the right of rescission was asserted. (n)

Article 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 assented thereto.

If, however, a negotiable document of title has been issued for goods, no seller's lien or right of stoppage in transitu shall defeat
the right of any purchaser for value in good faith to whom such document has been negotiated, whether such negotiation be
prior or subsequent to the notification to the carrier, or other bailee who issued such document, of the seller's claim to a lien or
right of stoppage in transitu. (n)

Article 1536. The vendor is not bound to deliver the thing sold in case the vendee should lose the right to make use of the terms
as provided in article 1198. (1467a)

Article 1537. The vendor is bound to deliver the thing sold and its accessions and accessories in the condition in which they were
upon the perfection of the contract.

All the fruits shall pertain to the vendee from the day on which the contract was perfected. (1468a)

Article 1538. In case of loss, deterioration or improvement of the thing before its delivery, the rules in article 1189 shall be
observed, the vendor being considered the debtor. (n)

Article 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:

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 measure or number,
the vendor shall be obliged to deliver to the vendee, if the latter should demand it, all that may have been stated in the contract;
but, should this be not possible, the vendee may choose between a proportional reduction of the price and the rescission of the
contract, provided that, in the latter case, the lack in the area be not less than one-tenth of that stated.

The same shall be done, even when the area is the same, if any part of the immovable is not of the quality specified in the
contract.

The rescission, in this case, shall only take place at the will of the vendee, when the inferior value of the thing sold exceeds one-
tenth of the price agreed upon.

Nevertheless, if the vendee would not have bought the immovable had he known of its smaller area of inferior quality, he may
rescind the sale. (1469a)

Article 1540. If, in the case of the preceding article, there is a greater area or number in the immovable than that stated 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)

Article 1541. The provisions of the two preceding articles shall apply to judicial sales. (n)
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Sales Notes for Midterm

Article 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 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.

The same rule shall be applied when two or more immovables as sold for a single price; but if, besides mentioning 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 the area or number specified in the
contract; and, should he not be able to do so, he shall suffer a reduction in the price, in proportion to what is lacking in the area
or number, unless the contract is rescinded because the vendee does not accede to the failure to deliver what has been stipulated.
(1471)

Sale on lump sum:

Sale of real estate in lump sum not for the unit of measure or number, there shall be no increase or decrease in the price although
there maybe a bigger or lesser area than in the contract, any discrepancy is not material, the buyer cannot rescind he contract

Sale of property in lump sum is a hazard which the parties must presumed to have assumed, this hazard works both ways

Sale of two or more immovables for a single price, the rule is the same as when the real property is sold for a lump sum

Rule when the area or number is stated together with the boundaries, vendor is bound to deliver all that is included within the
boundaries stated, if there is difference between the area and boundaries, boundaries prevail, boundaries contain the real and true
area of the land. If vendor cannot deliver all that is designated in the boundaries, the vendee has the option: a) reduce the price in
proportion to the deficiency

Article 1543. The actions arising from articles 1539 and 1542 shall prescribe in six months, counted from the day of delivery.
(1472a)

Article 1544. If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who
may have first taken possession thereof in good faith, if it should be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first recorded it in the
Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was first in the possession; and, in the
absence thereof, to the person who presents the oldest title, provided there is good faith. (1473)

Rules of preference in double sale of property:

Movable or personal property-if sold to two or more vendees by the same owner, ownership shall be transferred to the vendee
who has first taken possession of it good faith

Immovable property or real property-if what has been sold to different by the same owner is an immovable:

A) To the first vendee who first registered or recorded his deed of sale in good faith
B) If no inscription of recording, the ownership shall pertain to the vendee who first took possession of the property in
good faith
C) If the vendees have taken the possession at the same time and both in good faith, the ownership will be the one who
presents the oldest title
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Sales Notes for Midterm

Purchaser in good faith-one who buys the property of another without notice that some other person has a right to or interest
in such property and pays a full and fair price for the same time

Applicable if the following requisites are present:

a) The vendor has an existing right over the property and power of disposal
b) There are at least two sales executed by the same vendor
c) The sales involve the same property
d) There are two or more vendees of the same property sold by the vendor

An unrecorded sale of real property of prior date prevails over a recorded mortgage of a later date

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