Sales - REVIEWER PDF

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EARNEST MONEY VS OPTION MONEY Take a look at the intention EARNEST if it is intended to be part of the purchase price. – as proof of the perfection of contract, also a down payment. With giving of the earnest money, it is a contract of sale. SUBJECT OR OBJECT is the land itself. CONSIDERATION, the whole amount.

OPTION if it is intended to be a payment for the given time to think or decide, wherein within this period, the seller CANNOT OFFER it to someone else. An option contract – preparatory contract before the perfection of a contract of absolute sale between the parties. SUBJECT OR OBJECT is the option to purchase. CONSIDERATION, the given money. In deciding, and saying YES, the option money can be a deduction or forfeited in favor of the seller (because it is a consideration) – it depends on their agreement. IF THE INTENTION TO BUY IS COMMUNICATED, THE OPTION CONTRACT WILL NOW EXECUTE A CONTRACT OF (ABSOLUTE) SALE. If NO, the option money is forfeited because the money is not paid for the land but to have a week to decide. If did not decide within the period, the money is forfeited and the seller can already offer it to someone else. If within the week, seller sells the land to other without the knowledge of the buyer. The buyer can sue the seller for breach of option contract. Because the seller has the obligation to wait for a week.

OBLIGATIONS OF THE SELLER    

Transfer of ownership Delivery of the thing and its fruits, accessions and accessories Warrant the thing sold Take care of the thing sold o Ordinary Diligence or diligence of a good father of a family.

TRANSFER OF OWNERSHIP It is transferred thru actual reconstructive delivery of the thing sold, unless it is stated in their agreement (e.g. contract to sell).

CONTRACT TO SELL OR PACTUM RESERVATI INDOMINI Despite delivery, there is no ownership. Ownership is reserved until full payment.

SALE ON APPROVAL/TRIAL/SATISFACTION Kinds of contract of sale where they sell the object upon trial, approval or satisfaction. Seller is owner until it is accepted.

DELIVERY OF THE THING Delivery – the thing is placed in the control and possession of the buyer. Requisites: Intention to deliver and transfer  

Seller must have control and buyer must be put under control Transfer ownership

Kinds of Delivery 

Actual or real – physically placing the thing in the hands of the buyer (movable) physically placing it to the

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buyer the possession and control (immovable). Constructive or legal – subclasses: formal or legal formalities, symbolic delivery, etc. Quasi traditio or delivery of incorporeal property...