RECIT FEB 21

1. What are the remedies of the vendee in case of hidden defects?

Answer:
- withdrawal or rescission (accion redhibitoria) plus damages;
- proportionate reduction (accion quanti minores o estimatoria) - reduction in the price, plus
damages

2. When does period of redemption begin to run?

Answer:
- Right of legal pre--emption or redemption shall be exercised within 30 days from written notice
by the buyer – deed of sale not to be recorded in Registry of Property unless accompanied by
affidavit that buyer has given notice to redemptioners
- When there is actual knowledge, no need to give written notice; period of redemption begins to
run from actual knowledge

3. What is pre-emption? (Art. 1622)

Answer:
-The act or right of purchasing before others. It is exercised before the sale or resale of the
would-be vendor
4. What are the requisites for the right of pre-emption/redemption of adjacent owners of urban
lands? (Art. 1622)
Answer:
- The piece of land is an urban land
- The one exercising the right must be an adjacent owner
- The piece of land must be so small and so situated that a major portion thereof cannot be used
for any practical purpose within a reasonable time
- Such urban land was bought by its owner merely for speculation
- It is about to be resold or that its resale was perfected

5. What are necessary expenses? (Art. 1616)

Answer:
- These are expenses incurred for the preservation of the thing or those which seek to prevent
waste, deterioration, or loss of the thing.

6. When Seller’s Creditor Can Use Seller’s Right of Redemption?

Answer:
-Under Art. 1610. The creditors of the vendor cannot make use of the right of redemption
against the vendee, until after they have exhausted the property of the vendor.

7. Rights and obligations of buyer in case of rescission (art 1599)

Answer:
- in case rescission, the buyer shall cease to be liable for the price, his only obligation being to
return the goods.
- if he has paid the price or any part thereof, he may recover it from the seller
- He has also the right to hold the goods as bailee for seller should the latter refuse the return of
the goods and
- He has the right to have a lien on the goods for any portion of the price already paid which lien
he may enforce as if he were an unpaid seller

8. When rescission by the buyer not allowed (art1599)

Answer:
- if the buyer accepted the goods knowing of the breach of warranty without protest
- if he fails to notify the seller within a reasonable time of his election to rescind
- if he fails to return or offer to return the goods in substantially as good condition as they were in
at the time of the transfer of ownership to him . But where the inquiry to the goods was caused
by the very defect against which the seller warranted, the buyer may still rescind the sale

9. Is the vendor still liable for eviction in case of prescription?

Answer:
- When prescription is completed before the sale, the vendee can enforce the warranty against
eviction. When prescription is completed after the sale, though it started before the sale, the
vendor is not liable for eviction since the vendee could interrupt the running of such period by
bringing necessary action.(Art. 1550)

10. What are the effects when the buyer refuses of accept delivery for justifiable reason/s?
Answer:
- the buyer has no duty to return the goods to the seller unless otherwise agreed - title to the
goods does not pass on to the buyer
- the buyer shall not be obliged to pay the price
- if the buyer constitutes himself as depositary, then he shall be liable as such. (Art. 1587)

11. When are goods considered in transitu?

Answer:
- After delivery to a carrier or other bailee and before the buyer or his agent takes delivery of
them; and
- If the goods are rejected by the buyer, and the carrier or other bailee continues in possession of
them

12. Ways of exercising the right to stop

Answer:
- By taking actual possession of the goods
- By giving notice of his claim to the carrier or bailee

13. What is the general rule for sale of credit or other incorporeal rights in litigation?
Answer:
- Debtor has the right of legal redemption in sale of credit or incorporeal rights in litigation
14. What is legal redemption?
Answer:
- It is the right to be subrogated upon the same terms and conditions stipulated in the contract, in
the place of one who acquires a thing by purchase, or dation in payment, or by any other
transaction whereby the ownership is transmitted by onerous title.

15. When is the buyer liable for interest?

Answer:
- interest is stipulated
- thing sold produces fruits or income
- buyer is in default

16. Effects of warranties

Answer:
- natural tendency is to induce buyer to purchase the subject matter
- buyer purchases subject matter relying thereon
- seller liable for damages in case of breach

17. What is an option to purchase?

Answer:
- generally a principal contract and may be created independent of another contract
- consideration separate and distinct from the purchase price
- may be exercised by notice of its exercise to the offeror
- period of the option may be beyond 10-year period

18. Sale of animals is void when:(1575)

Answer:
- The sale of animals suffering from contagious diseases shall be void.
- 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 contract, and they are found to be unfit therefor.

19. The vendor may immediately sue for rescission of the sale if there are reasonable grounds to
fear: (1591)
Answer:
- Loss of the immovable sold
- Loss of the price

20. Can the period of redemption (right to repurchase) be extended after the original period has
expired? (1606)
Answer:
 -As long as the total period should not exceed 10 years from the time of the making of the
contract, because there is nothing in the law to prohibit this.

21. Rule if two or more adjoining owners desire to exercise the right of redemption
Answer:
- The owner of the adjoining land of smaller area shall be preferred.
- If both lands have the same area, the one who first requested the redemption, shall be
preferred.

22. What should be the condition of the property at the time of conventional redemption?
Answer:
- The vendor shall receive the property free from all charges constituted by the vendee.
- Vendor shall respect the leases which the vendee may have executed in good faith, and in
accordance with the custom of the place where the land is situated.

23. What is the remedy of the buyer if the area is the same but a part of the immovable is not of the
quality specified in the contract?
Answer:
- ask for a proportionate reduction of price if the inferior thing does not exceed one-tenth of the
price agreed upon, unless the buyer would not have bought the thing had he known of its
inferior quality, in w/c case he may opt to rescind the sale
- rescind the sale if the inferior value of the thing exceeds one-tenth of the price agreed upon.

24. B bought from S a lot for a lump sum of 1M. The deed of sale states the area at 1000 square
meters and also the boundaries of the lot. If the actual area contained within the boundaries is
1100 square meters and the seller wants to deliver only 1000, what is the remedy of B?
Answer:
- B had the right to rescind the contact or
- ask for a proportionate reduction in the price

25. Instances where implied warranties are inapplicable

Answer:
- as is and where is sale
- sale of second-hand articles
- sale by virtue of authority in fact or law

26. What are the requisites for acquisition of good title by the buyer in case the seller has
voidable title? (Art. 1506)
Answer:
- He buys the thing before title of seller has been avoided
 - He buys in good faith and for value
- Without notice of any defect in the sellers title

27. Give examples of contract of sale that must be in writing otherwise they can’t be
enforced(Art. 1483)
Answer:
- Sale of personal property at a price not less than PHP 500
- Sale of real property or an interest therein regardless of the price involved
- Sale of property not to be performed within a year from the date thereof regardless of
the nature of property and price involved

28. What is the effect of inadequacy of price in involuntary or execution sales?

Answer:
- General Rule: Mere inadequacy is not a sufficient ground for the cancellation of an
execution sale.
- Exception: If the price is inadequate as to shock the conscience of the court, a judicial
sale will be set aside.

29. What is a vindicatory action?

Answer:
- A vindicatory action is an action brought by the owner against the holder and possessor
of a thing in order to recover it.

30. What are the requisites for the seller to warrant that the thing is fit for the particular
purpose of the buyer?
Answer:
- the buyer makes known to the seller the particular purpose for which he is acquiring the
thing; and
- the buyer acquires the thing relying upon the seller’s skill or judgment

31. What is pactum commissorium?

- a stipulation enabling the mortgagee to acquire ownership of the mortgaged properties w/o
need of foreclosure proceedings which is a nullity being contrary to the provisions of Article
2088 of the Civil Code.
32. What are the warranties of an assignor of credit?
A. The legality and existence of credit at the time of sale. No such warranty if the credit sold is
doubtful.
B. As regards debtor’s insolvency, he does not warrant the same except:
1. When there’s stipulation
2. Insolvency existed prior to the sale and of public knowledge

33. What are the Requisites for warranty against eviction?

1. The vendee is deprived in whole or in part of the thing purchased.
2. The vendee is deprived by virtue of a final judgment.
3. The judgment is based on a right prior to the sale or an act imputable to the vendor.
 4. The vendor was summoned in the suit for eviction at the instance of the vendee.
5. There is no waiver on the part of the vendee.

34. What are the essential elements of an equitable mortgage?

Answer: -
 the parties enter into what appears to be a contract of sale –
 Their intention is to secure an existing debt by way of mortgage.
35. What are the requisites for vendor’s liability should the immovable sold be encumbered with
easement or servitude?
Answer: -
 the easement must be non-apparent –
 it must not have been mentioned in the agreement –
 it must be of such nature that it must be presumed that the vendee would not have
acquired the immovable had he been aware thereof (Art. 1560)

36. What is assignment of credit?

Answer: Assignment of credit is a contract whereby a person (assignor) transfer his credit, right
or action against a third person to another person (assignee) for a consideration which is certain
in money or its equivalent. (Art. 1624)

37. What are the purpose of legal redemption?

Answer: -
to enable the debtor to pay less than the value of the credit - to prevent speculation on the part
of the assignee - to put an end to the litigation (Art. 1634)

38. What are the liabilities of the seller in case of loss of the thing sold with hidden defects and the
cause of the loss is the defect?
Answer: - if the vendor was aware of the defect, he shall be obliged:
 to return the price;
 to refund the expenses of the contract;
 and to pay damages. –
if the vendor was not aware of the defect, he shall be obliged:
 to return the price;
 to pay the interest thereon; and to refund the expenses of the contract. (Art. 1568)
39. What are the liabilities of the seller in case of loss of the thing sold with hidden defects and the
cause of the loss is a fortuitous event or the fault of the vendee?
Answer: -
 if the vendee was aware of the defect, he shall be obliged: to return the price paid less
the value of the thing at the time of loss; and to pay damages. –
 if the vendor was not aware of the defect, he shall be obliged to return the price paid
less the value of the thing at the time of loss. (Art. 1569)