Coleen Lara Sedilles
BSA III
October 2, 2021
AE 306 Regulatory Framework & Legal
Issues in Business
In complete sentences, please provide the answer to the following set of questions. Provide the
legal basis of your answers.
1.
State the special rules where the determination of the price is left by the parties to the
judgment of a specified person or person.
 As stated in Art. 1469, the special rules that enclose the determination of prices left to
third parties is that the price becomes binding upon the parties who chose the third
person. This is general case except when: the third person acts in bad faith or by mistake
as when the third person fixed the price having in mind not the thing which is the object
of the sale, but another analogous or similar thing in which case the court may fix the
price. But mere error in judgment cannot serve as a basis for impugning the price fixed;
and the third person disregards specific instruction or the procedure marked out by the
parties or the data given to him, thereby fixing an arbitrary price.
2.
What is the effect on the sale if the price is simulated?
 The sale would be considered as void; however, such action will already be validly
considered as a donation. This is in accordance with the Art. 1471. Also, if it looks like
it is not shown as a donation or a contract transferring ownership to avoid binding, the
ownership of the thing is immediately considered as not transferred. If there’s no
transfer, the contract is inexistent as much as it is void.
3.
What is the effect of gross inadequacy of price upon a contract sale?
 As stated in Art. 1470, there the gross inadequacy of price upon a contract of sale does
not have bearing in the contract of sale, except when there is a known defect in the
consent of parties, or there is another type of contract intended for the transaction such
as donation.
4.
When is a contract of sale perfected?
 According to Art. 1475, a contract of sale is already considered perfected when there is
a meeting of the minds upon the parties agreeing about the object of the contract and its
price. They now have the right to demand performance from each other still in
accordance with the governing laws regarding contracts.
5.
When is a sale by auction perfected?
 According to Art. 1476, a contract of sale by auction is considered perfected when the
auctioneer (person doing the bid) directly announces a perfection through a slam of
his/her gravel. Any act of retraction, objection or bidding is accepted not until the
hammer is heard to declare a sale.
6.
What is the effect of an accepted unilateral promise or offer to sell or buy a thing for a price
certain?

.
7.
8.
As stated in Art. 1479, the effect of an accepted unilateral promise is that both parties
have the right to demand performance from each other. This is due to the fact that their
agreement is binding upon the parties if there is already an object and a price
determined in the agreement
Give the rules with regard to any injury to or benefit from the thing sold after the contract is
perfected but before delivery.
 Art. 1480 states that there are two rules and applies only if the thing is determinate. The
first rule emphasizes that the seller will not be responsible for any fortuitous event
without his fraud or negligence. The risk is already passed on to the buyer even if it is
not yet delivered to him/her. The second rule emphasizes that the risk will not be put
upon the seller until it the thing has been weighed, counted, or measured, and delivered.
But the seller will assume the risk if there is a delay in transporting the goods sold to the
buyer.
State the rules governing the sale of goods by description and/or by sample.
 The rules governing the sale of goods by description or by sample are the following: the
contract has the possibility of being rescinded if the volume of the goods delivered is
not coherent to the description stated in the contract; the same revocation is done when
the sample does not correspond with the description in the contract as well; lastly, all
the more, the sale can be rescinded when both the description and the sample is not
coherent with what is being stipulated in the contract.