Law on Sales
Chapter 2 – Capacity to Buy or Sell
ARTICLE
Article
1489
Person who
may Enter
into a
Contract of
Sale
Article 1490
Incapacity
by Relation
GENERAL RULE
All person who are •
authorized in this code to
obligate themselves, may
enter into a contract of
sale.
Contracts entered into •
by a minor and other
incapacitated
persons
are voidable.
EXCEPTION
ADDITIONAL INFORMATION
•
Case:
Law Kinds of Incapacity:
determines
that
• Absolute - pertains to
party suffers from
persons who cannot bind
either absolute or
themselves. Ex. Minor,
relative incapacity.
Insane
or
demented
persons.
•
However, where the
necessaries
are • Relative Incapacity –
sold and
delivered
where it exists only with
to him without the
reference to certain
intervention of the
persons or class of
parent or guardian,
property
he must pay a
• Necessaries
those
reasonable
price
things which are needed
therefor.
for sustenance, dwelling,
clothing
and
medical
attendance.
The husband and the wife Unless:
Reason for the Rule:
cannot sell property to each • When a separation • To prevent commission of
other
of property was
fraud or prejudice to third
agreed upon in the
persons.
marriage
• To prevent one from
settlements;
unduly
influencing
the
other.
•
Article 1491
Incapacity
by Reason
The
following
persons •
cannot acquire by purchase,
even at a public or judicial
auction, either in person
or through the mediation
of another:
• Guardian
• Agents, sale entrusted to
them.
• Executors
and
administrators
• Public
officers
and
employees
• Justices,
judges,
prosecuting attorneys,
clerks of superior and
inferior
courts,
and
other
officers
and
employees
connected
with the administration
of justice
• Any
others
specially
disqualified by law.
When there has been • To
avoid
indirect
a judicial separation
donations.
of property under
article 191. (1458a)
Exception for the Reason for Prohibition:
agent: unless the • TO Prevent frauds on the
consent
of
the
part of the persons
principal has been
enumerated therein and
given.
minimize temptation to
the exertion of undue and
improper influence.
• The law does not trust
human nature to resist
the temptation likely to
arise out the antagonism
between interest of the
seller and the buyer.
Article 1492
Prohibition
Extends to
Sales in Legal
Redemption
The prohibitions in the two
preceding
articles
are
applicable to sales in legal
redemption, compromises
and renunciations.
The prohibitions in the two
preceding
articles
are
applicable to sales in legal
redemption, compromises
and renunciations.
1. The relative incapacity
applies also to sales by
virtue of legal redemption,
compromise,
and
renunciations:
• Compromise - contract
whereby the parties, by
reciprocal concessions,
avoid a litigation or put
an end to one already
commenced.
• Renunciation - creditor
gratuitously abandons
his right against his
creditor. Condonation
and Remission.
2. The persons disqualified to
buy referred to in Articles
1490 and 1491 are also
disqualified to become
lessees of the things
mentioned therein. (Art.
1646.)
Chapter 3 – Effects of the Contract when the Thing Sold has been Lost
ARTICLE
Article 1493
Effect of
Loss of Thing
at the Time
of Sale
GENERAL RULE
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.
Article 1494
Effect of
Loss in Case
of Specific
Goods
Where the parties purport a
sale of specific goods, and
the goods without the
knowledge of the seller has
perished in part or have
wholly or in a material part
so deteriorated in quality as
to be substantially changed
EXCEPTION
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)
ADDITIONAL INFORMATION
Effect of loss of thing at the
time of sale: (Remedies)
1. Thing entirely lost. —
Where the thing is entirely
lost at the time of
perfection, the contract
is inexistent and void (Art.
1409[3].) because there is
no object.
2. Thing only partially lost. —
If the subject matter is
only partially lost, the
vendee may elect between
withdrawing from the
contract and demanding
the remaining part, paying
its proportionate price.
Effect of loss in case of
specific goods:
• Sale divisible. — The second
option is available only if
the sale is divisible. A
contract is divisible when
its consideration is made
up of several parts.
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.
•
Sale indivisible. — Suppose
the sale is not divisible,
what price is the buyer to
pay for the remaining
goods if he elects to
continue with the sale? It
is believed that the buyer
should be made to pay only
the proportionate price
of the remaining goods. If
the sale is indivisible, the
object thereof may be
considered as a specific
thing.