PRELIMINARY EXAMINATION IN SALES

1.       What are the three common forms of document of title? Describe each.

2. What are the threefold characters or nature of a document of title?

3.B stole the goods of X, and thereafter stored them in A’s warehouse. A issued a negotiable receipt to the order of B. B then indorsed the receipt and delivered it to C, A purchaser for value and without notice. Should X notify A that the goods were stolen from him and should not be delivered to the holder of the receipt but despite such notice, A delivered said goods to C. Is A liable to X? Reasons.

4.A sold goods to B. B did not pay in full the price of the goods. As seller, A has a lien over the goods or the right to stop the goods in transit, for the unpaid price of the goods. B deposited the goods with a warehouseman and a negotiable warehouse receipt was issued. B negotiated the receipt to C who had no notice of the lien of A, the seller of the goods. Does this lien prevent C from obtaining delivery of the goods by the warehouseman? Why?

5.What is the effect if at the time the contract of sale is perfected the object of the contract has been entirely lost? If part of it is only lost, what are the rights of the vendee?

6.Can a husband sell his property to his wife? What is the effect is said sale is done? Are there exceptions? If there are, please mention them.

7.When is ownership of the thing sold transferred to the vendee? Can there be other stipulations possible?

8.Art. 1465. Things subject to a resolutory condition may be the object of the contract of sale. Give at least two examples of things which are subject to a resolutory condition.

9.IN a contract of sale, what are the obligations of the seller and buyer pursuant to Art. 1458 of the Civil Code?

10. Generally, when is the thing sold understood as “delivered”? What if the object of the sale is (a) movable  and (b) immovable?

11. (POWER COMMERCIAL AND INDUSTRIAL CORPORATION, petitioner, vs. COURT OF APPEALS, SPOUSES REYNALDO and ANGELITA R. QUIAMBAO and PHILIPPINE NATIONAL BANK, respondents. THIRD DIVISION[G.R. No. 119745.  June 20, 1997)Is the seller’s failure to eject the lessees from a lot that is the subject of a contract of sale with assumption of mortgage a ground (1) for rescission of such contract and (2) for a return by the mortgagee of the amortization payments made by the buyer who assumed such mortgage? Explain your answer using the facts of the above mentioned case which was assigned to you for reading.

12. What are the requisites for the breach of warranty against eviction?

Answer: A breach of this warranty requires the concurrence of the following circumstances:

(1)   The purchaser has been deprived of the whole or part of the thing sold;

(2)   This eviction is by a final judgment;

(3)   The basis thereof is by virtue of a right prior to the sale made by the vendor; and

(4)   The vendor has been summoned and made co-defendant in the suit for eviction at the instance of the vendee.

13. Define Solutio indebiti.State the requirements to apply the principle of solution indebiti.

Answer:Article 2154 of the Code, solutio indebiti. This doctrine applies where: (1) a payment is made when there exists no binding relation between the payor, who has no duty to pay, and the person who received the payment, and (2) the payment is made through mistake, and not through liberality or some other cause.

14. (Solid Homes v. Laserna G.R. 166051 (2008))

On 1 April 1977, respondents Evelina Laserna and Gloria Cajipe, represented by their attorney-in-fact, Proceso F. Cruz, as buyers, entered into a Contract to Sell with petitioner Solid Homes, Inc. (SHI), a corporation engaged in the development and sale of subdivision lots, as seller.  The subject of the said Contract to Sell was a parcel of land located at Lot 3, Block I, Phase II, Loyola Grand Villas, Quezon City, with a total area of 600 square meters, more or less.  The total contract price agreed upon by the parties for the said parcel of land was P172,260.00, to be paid in the following manner: (1) the P33,060.00 down payment should be paid upon the signing of the contract; and (2) the remaining balance of P166,421.88 was payable for a period of three years at a monthly installment of P4,622.83 beginning 1 April 1977.  The respondents made the down payment and several monthly installments.  When the respondents had allegedly paid 90% of the purchase price, they demanded the execution and delivery of the Deed of Sale and the Transfer Certificate of Title (TCT) of the subject property upon the final payment of the balance.  But the petitioner did not comply with the demands of the respondents. 

          The respondents whereupon filed against the petitioner a Complaint for Delivery of Title and Execution of Deed of Sale with Damages, dated 28 June 1990, before the Housing and Land Use Regulatory Board (HLURB).  The same was docketed as HLURB Case No. REM-073090-4511.  In their Complaint, respondents alleged that as their outstanding balance was only P5,928.18, they were already demanding the execution and delivery of the Deed of Sale and the TCT of the subject property upon final payment of the said amount.  The petitioner filed a Motion to Admit Answer, together with its Answer dated 17 September 1990, asserting that the respondents have no cause of action against it because the respondents failed to show that they had complied with their obligations under the Contract to Sell, since the respondents had not yet paid in full the total purchase price of the subject property.  In view of the said non-payment, the petitioner considered the Contract to Sell abandoned by the respondents and rescinded in accordance with the provisions of the same contract.  

Questions: (a) Can Solid Homes be compelled to execute the Deed of Sale and delivery of title to Laserna? (b) On the other hand, can Solid Homes cancel the sale? Explain.

15.  A bought a pair of shoes from a shoe store and repair shop. It was later discovered, however, that the shoes did not belong to the store but to a customer who had left it there for repair. Did A acquire good title to the shoes? Reason.

16. B in good faith, has purchased a diamond ring from C , a friend of his. C gave B a bill of sale. Later on, O identified the ring as one she had lost about a year ago. There is no question as to the veracity of O’s claim. In the meantime, C has disappeared. What advice would you give to B in reference to O’s demand that the ring be returned or surrendered to her? Explain your answer.

17. S delivered to B a videocam “on sale or return”. Did B become the owner upon delivery? Can B return the goods even if he finds nothing wrong with the quality of the goods? If B does not return the videocam in due time, what will be the consequence of his inaction? If B had not returned the goods, does he have to pay the price, even if the videocam has been destroyed by a fortuitous event?

18.When is the vendee not obliged to make the delivery after the perfection of the contract of sale? Explain.

19. What the four rights of an unpaid seller?

20. A buys from B a piece of land supposed to contain 1,000 sq. meters at the rate of P10,000/sq.m. But the land really contained P1,500 sq. m. What are the options of A? Can A rescind the contract? Explain.