1. Ownership of a thing sold is acquired upon its delivery, either actual or constructive, to the buyer. Actual delivery occurs when the thing is placed under the buyer's control and possession. Constructive delivery can occur through execution of a public instrument, symbolical tradition, or quasi-delivery of incorporeal things.
2. The principal obligations of the vendor are to transfer ownership, deliver the thing, warrant against eviction and hidden defects, take care of the thing pending delivery, and pay expenses of the sale deed unless otherwise agreed.
3. Delivery establishes the buyer's right to enjoy and make use of the purchased property. Parties may agree on conditions for ownership transfer.
1. Ownership of a thing sold is acquired upon its delivery, either actual or constructive, to the buyer. Actual delivery occurs when the thing is placed under the buyer's control and possession. Constructive delivery can occur through execution of a public instrument, symbolical tradition, or quasi-delivery of incorporeal things.
2. The principal obligations of the vendor are to transfer ownership, deliver the thing, warrant against eviction and hidden defects, take care of the thing pending delivery, and pay expenses of the sale deed unless otherwise agreed.
3. Delivery establishes the buyer's right to enjoy and make use of the purchased property. Parties may agree on conditions for ownership transfer.
1. Ownership of a thing sold is acquired upon its delivery, either actual or constructive, to the buyer. Actual delivery occurs when the thing is placed under the buyer's control and possession. Constructive delivery can occur through execution of a public instrument, symbolical tradition, or quasi-delivery of incorporeal things.
2. The principal obligations of the vendor are to transfer ownership, deliver the thing, warrant against eviction and hidden defects, take care of the thing pending delivery, and pay expenses of the sale deed unless otherwise agreed.
3. Delivery establishes the buyer's right to enjoy and make use of the purchased property. Parties may agree on conditions for ownership transfer.
1. Ownership of a thing sold is acquired upon its delivery, either actual or constructive, to the buyer. Actual delivery occurs when the thing is placed under the buyer's control and possession. Constructive delivery can occur through execution of a public instrument, symbolical tradition, or quasi-delivery of incorporeal things.
2. The principal obligations of the vendor are to transfer ownership, deliver the thing, warrant against eviction and hidden defects, take care of the thing pending delivery, and pay expenses of the sale deed unless otherwise agreed.
3. Delivery establishes the buyer's right to enjoy and make use of the purchased property. Parties may agree on conditions for ownership transfer.
ARTICLE 1493 Gen Rule: Ownership of the thing sold is
EFFECT OF LOSS OF THING AT THE TIME OF acquired only upon its delivery, actual or SALE constructive to the buyer.
1. THING ENTIRELY LOST WAYS OF EFFECTING DELIVERY
-at the time of perfection, the contract is inexistent 1. BY ACTUAL OR REAL DELIVERY and void because there is no object. THE THING SHALL BE UNDERSTOOD AS 2. THING ONLY PARTIALLY LOST DELIVERED; when it is placed in the control -the vendee may elect between withdrawing from and possession of the vendee. the contract and demanding the remaining part, 2. BY CONSTRUCTIVE OR LEGAL DELIVERY paying its proportionate price. -By operation of law 3. BY DELIVERY IN ANY OTHER MANNER WHEN A THING CONSIDERED LOST SIGNIFYING AN AGREEMENT Its existence is unknown or it cannot be recovered. Exceptions: ARTICLE 1494 1. When the seller and buyer agree that the EFFECT OF LOSS IN CASE OF SPECIFIC ownership shall remain wt the seller until GOODS full payment. 2. Contract to sell ARTICLE 1494 applies only to sales of goods, that 3. Sale on approval, trial, or satisfaction is, the object of the sale consists of a mass of 4. Implied reservation of ownership specific goods the seller may, by the terms of the 2 remedies to the buyer: contract, reserve the right of possession or 1. SALE DIVISIBLE- a contract is DIVISIBLE when ownership in the goods its consideration is made up of several parts. (valid in existing goods) 2. CONTRARY MAY BE STIPULATED 2. SALE INDIVISIBLE- when the consideration is The parties may stipulate that ownership in the thing entire and single.The object may be considered as a shall pass to the buyer only after he has fully paid specific thing. (avoidance) the price or fulfilled conditions.
CHAPTER 4 SECTION 2- DELIVERY OF THE THING SOLD
OBLIGATIONS OF THE VENDOR ARTICLE 1497 ARTICLE 1495 KINDS OF DELIVERY PRINCIPAL OBLIGATIONS OF THE VENDOR 1. BY ACTUAL OR REAL DELIVERY 1. to transfer the ownership THE THING SHALL BE UNDERSTOOD AS 2. to deliver the thing DELIVERED; when it is placed in the control and (vendor-need not be the owner at the time of possession of the vendee. perfection; a right to transfer is enough) 2. LEGAL/CONSTRUCTIVE 3. to warrant against eviction and hidden defects 3. QUASI-TRADITION 4. to take care of the thing, pending delivery, with Delivery of rights, credits, incorporeal rights proper diligence of a good father of a family IMPORTANCE OF TRADITION "preserve the thing" - the seller should not Delivery of the thing to enable the buyer to transform/alter the thing sold. enjoy and make use of the property purchased. 5. to pay for the expenses for the execution and A. Execution of public instrument registration of the deed of sale, unless there is a B. Placing of titles in the hands of buyer stipulation to the contrary C. Allowing buyer to make use of rights 1. WHEN DEEMED MADE- it involves the physical points to thing sold which shall thereafter be at the delivery of the thing and is usually done by passing control and disposal of the vendee a movable thing from hand to hand. TRADITIO BREVIE MANU 2. NOT ALWAYS ESSENTIAL TO PASSING OF -when the vendee has already the possession of the TITLE- The parties to the contract may agree when thing sold by virtue of another title as when the and on what conditions the ownership in the subject lessor sells the thing leased to the lessee. of the contract shall pass to the buyer. ARTICLE 1500 WAYS OF EFFECTING CONSTRUCTIVE TRADITION CONSTITUTUM POSSESSORIUM DELIVERY (opposite of brevie manu) 1. EQUIVALENT TO ACTUAL DELIVERY -it takes place when the vendor continues in It may be effected in any of the following ways: possession of the property sold as owner but in a. by the execution of public instrument some other capacity, as for example, when the b. by symbolical tradition/ tradition symbolica vendor stays as a tenant on the vendee. c. by traditio longa manu d. by tradition brevi manu ARTICLE 1501 e. by tradition constitutum possessorium or QUASI-TRADITIO/QUASI-DELIVERY f. by quasi-delivery or quasi-traditio Tradition can only be made wt respect to corporeal things. ARTICLE 1498 In case of incorporeal things, delivery is effected: SPEAKS OF CONSTRUCTIVE DELIVERY AND 1. by the execution of public instrument. TRADITION SYMBOLICA 2. by placing the titles to the hands of the EXECUTION OF PUBLIC INSTRUMENT buyer. OR DOCUMENT 3. allowing the buyer to use his rights as the Public instrument is a document prepared by the new owner wt consent of the seller. notary public. Notary Public is the authorized person who certifies ARTICLE 1502 documents. CONTRACTS OF SALE OR RETURN, AND OF SALE ON TRIAL, APPROVAL, OR SATISFACTION When the sale is made through a 1. SALE OR RETURN - goods delivered to the public instrument, the execution thereof shall be buyer under sale or return to give the buyer equivalent to the delivery of the thing which is the the option to return the goods instead of object of the contract. paying the price. UPON DELIVERY WHEN THE THING NOT SUBJECT TO CONTROL -ownership passes to the buyer OF VENDOR HOWEVER, the buyer has the right to: -a seller cannot deliver constructively if he revest the ownership in the seller by; cannot deliver actually even if he wants to. ● returning the goods w/in the time fixed in the contract A person who does not have ACTUAL ● if no time has been fixed w/in a reasonable POSSESSION of the thing sold cannot transfer time constructive possession by execution and 2. SALE ON TRIAL OR SALE ON delivery of a public instrument. APPROVAL/SATISFACTION also called "SALE ON ACCEPTANCE" ARTICLE 1499 SPEAKS OF 2 KINDS OF CONSTRUCTIVE OWNERSHIP PASSES TO THE BUYER DELIVERY not from delivery, but after delivery and after TRADITIO LONGA MANU the buyer -it takes place by the mere consent or agreement of • signifies his approval or acceptance to the seller or the contracting parties as when the vendor merely • does any other act adopting the transaction; IF THE BUYER DOES NOT SIGNIFY agent or to the order of the seller or his agent, the HIS ACCEPTANCE; when deemed accepted seller thereby reserves the ownership in the goods. - when he retains the goods without 2. RIGHTS OF THE SELLER giving notice of rejection. AFTER The seller may not only retain the goods until • the expiration of the time for the return of the the buyer performs his obligation under the contract. goods as stipulated; or • after the lapse of reasonable time, when no WHERE SELLER’S TITLE ONLY FOR PURPOSE stipulated period within which to return. OF SECURITY REQUIRED: EXPRESS WRITTEN AGREEMENT 1. FORM OF BILL OF LADING NOT CONCLUSIVE (security) The circumstances may be such that were it not for the form of the bill of lading, the ownership DIFFERENCES would have passed to the buyer on shipment of the SALE ON RETURN goods. The seller reserves ownership simply to 1. subject to resolutory condition secure himself in regard to the performance by the 2. depends entirely on the will of the buyer buyer of the latter’s obligation. 3. ownership passes to the buyer and BILL OF LADING - THERE IS RESERVATION OF subsequent return of goods reverts the OWNERSHIP WHEN ownership Where goods are shipped, and by the 4. the risk of loss or injury rests upon the buyer bill of lading the goods are deliverable SALE ON TRIAL • to the seller or his agent, or 1. subject to suspensive condition • to the order of the seller or of his 2. depends on the character or quality of the agent, goods the seller thereby reserves the ownership in the 3. ownership remains in the seller until the goods. buyer signifies his approval or acceptance to the seller 2. WHERE OWNERSHIP WOULD HAVE PASSED 4. the risk still remains with the seller BUT FOR THE FORM OF BILL OF LADING By shipping the goods, the seller has ARTICLE 1503 definitely lost all use of them to the buyer. Where the DELIVERY OF SPECIFIC GOODS SOLD title to the goods is held merely for the purpose of GENERALLY PASSES TITLE security, the beneficial owner (buyer), not the one -this article relates to a sale of specific goods who holds for security (seller) bears the risk of loss or deterioration. "Bill of Lading"- is a contract b/w you(owner) and the carrier stating what goods you're WHERE THE BUYER OR HIS AGENT IS shipping. Also served as a RECEIPT. CONSIGNEE BUT SELLER RETAINS THE BILL OF LADING 1. DELIVERY TO A CARRIER The seller thereby retains a right to the General rule: the delivery be it only constructive, possession of the goods as against the buyer. and delivery to the carrier is deemed to be a delivery Although the property in the goods will ordinarily to the buyer. pass to the buyer on delivery, the latter is unable to 2. REDELIVERING BY CARRIER TO SELLER obtain the goods without the bill. If the seller directs the carrier to redeliver the goods at their destination to the seller himself, or to WHERE BILL OF LADING IS SENT FORWARD his order. The ownership still remains in the seller. WITH DRAFT ATTACHED The fact that the bill of lading and bill of WHERE SELLER OR HIS AGENT IS CONSIGNEE exchange are attached together indicates that the 1. CARRIER BECOMES BAILEE FROM SELLER seller intends to make the delivery of the goods Where goods are shipped and by the bill of conditional upon the payment or acceptance of the lading the goods are deliverable to the seller or his draft. EFFECT OF BUYER’S OBTAINING POSSESSION EXCEPTIONS: OF BILL OF LADING WITHOUT HONORING 1. The owner of the goods is by his conduct DRAFT precluded (make something possible) from denying the seller’s authority to sell. A purchaser in good faith for value of the bill 2. Sale is made by the registered owner or of lading or goods from the buyer will obtain the apparent (name appears on records) owner. ownership of the goods although the bill of 3. Sales approved by the order of the court exchange has not been honored. 4. Purchase in a merchant’s store, fairs or NOTE: ART. 1503 Does not apply to “contract of markets. carriage”(contract b/w a cargo/passengers and 5. When the seller has a voidable title consignee/passengers) ARTICLE 1506 ARTICLE 1504 SALE BY ONE HAVING A VOIDABLE TITLE RISK OF LOSS If the seller has only a voidable title, buyer acquires AT SELLER'S RISK until the ownership therein is a good title to the goods provided he buys them: transferred to the buyer. a. Before the title of the seller has been UNLESS: otherwise agreed avoided b. In good faith for value AT BUYER'S RISK c. Without notice of the seller’s defect of title when the ownership therein is transferred to NOTE: Voidable contract is valid until annulled. the buyer whether actual delivery has been made or not. ARTICLE 1507 EXE: FUNCTION OF DOCUMENT OF TITLE • Where delivery of the goods has A document of title in which is stated that been made to the buyer or to a bailee for the buyer, the goods referred to therein will be delivered to in pursuance of the contract and the ownership in the bearer, or to order of any person named in the goods has been retained by the seller. such document is a negotiable instrument of -merely to secure performance by the buyer of title. his obligations under the contract, the goods are at the buyer's risk from the time of DOCUMENT AS A PROOF such delivery; A document of title is a symbol of goods • Where actual delivery has been covered by it, serving as a evidence of delayed through the fault of either the buyer or seller a. transfer of title the goods are at the risk of the party in fault. b. transfer of possession NOTE: Gen rule, risk of loss of specific goods is c. contract between the parties who are borne by the seller until ownership is transferred bound by its terms to the buyer. Document is negotiable if: RISK OF LOSS BY FORTUITOUS EVENT AFTER 1.) Goods are deliverable to bearer PERFECTION BUT BEFORE DELIVERY 2.) Goods are deliverable to the order of a certain If the thing is lost after perfection of the contract but person before its delivery, even before the ownership is transferred to the buyer, the risk of loss by a Common forms of document of title fortuitous event without the seller’s fault is borne by 1. Bill of Lading- contract or receipt for the the buyer. transport of goods and their delivery to the person named therein, to order or bearer. ARTICLE 1505 2. Dock Warrant- given by dock owners to an SALE BY THE PERSON NOT THE OWNER importer of goods recognizing the latter’s title of the GEN RULE: Buyer acquires no title even said goods. if in good faith (you cannot give what u do not have). 3. Warehouse Receipt- contract or receipt issued 1. if indorsed in blank or to bearer, the document by a person engaged in the business of storing becomes negotiable by delivery goods for a fee. 2. if indorsed to a specified person, it may be Quedan- a warehouse receipt that covers sugars. again negotiated by the indorsement of such person in blank, to bearer, or to another specified person. CLASSES OF DOCUMENTS OF TITLE Delivery alone is not sufficient. 1. NEGOTIABLE DOCUMENTS- those by the terms of which the bailee undertakes to deliver the goods ARTICLE 1510 to the bearer and to the order of a specified person. NEGOTIABLE DOCUMENTS OF TITLE MARKED “NON-NEGOTIABLE” 2. NON-NEGOTIABLE DOCUMENTS- those by the The words “not negotiable”, “non terms of which the goods covered are deliverable to negotiable” and the like when placed upon a a specified person. document of title in which the goods are to be delivered to “order” or to “bearer” have no effect ARTICLE 1508 and the document continues to be negotiable. A NEGOTIATION OF NEGOTIABLE DOCUMENT BY DELIVERY ARTICLE 1511 1. The terms of the document the carrier, TRANSFER OF NON-NEGOTIABLE DOCUMENTS warehouseman, or the bailee issuing the A non-negotiable title cannot be negotiated. same to deliver to the bearer. Even if the document is indorsed, the transferee 2. The terms of the document the carrier, acquires no additional right. warehouseman, or the bailee issuing the same to deliver to order of the: ARTICLE 1512 a. specified person WHO may negotiate negotiable document of title b. Endorsee of the docs and indorsed 1. By the owner it in blank to the bearer. 2. By the person to whom the possession or custody of the document has been entrusted by the owner Forms of Indorsement the loss must fall upon him whose misplaced a) Blank Indorsement- consist of signature of the confidence made the loss possible indorser without specifying the name of the indorsee. ARTICLE 1513 b) To bearer- where the indorsement states that the RIGHTS OF THE HOLDER goods are deliverable to bearer. It specifies the rights of a person to whom a c) Special Indorsement- name of indorsee is negotiated document of title has been duly specified. negotiated, in the case of a document of title to bearer, or by indorsement and delivery, in BAILEE- someone who receives personal the case of a document of title. Such person property from another, and has possession but acquires: not title. 1. Title of the person negotiating the document, over DUTY: to keep safe the property until it is the goods covered by the document; returned to the owner. 2. Title of the person to whose order by the terms of the document the goods were to be delivered, over ARTICLE 1509 such goods; NEGOTIATION OF NEGOTIABLE DOCUMENT BY 3. The direct obligation of the bailee to hold INDORSEMENT possession of the goods for him, as if the bailee had contracted to him directly. TWO KINDS OF NEGOTIATION NOTE: Mere transfer does not acquire directly 1. By delivery the obligation of the bailee. To acquire it, he 2. By indorsement plus delivery must notify the bailee.