Law on Sales Flashcards

As a rule, this contract of sale involving a piece of land is void,
A. Between a minor and a capacitated person.
B. Between two insane persons who did not act during lucid interval
C. Between first degree cousins
D. Between husband and wife

X, 17 years old, sold to Z, of legal age, her necklace worth P20,000 for P15,000. Later, Z
sold the necklace to Y for P20,000. Which of the following statements is correct?
A. X has got a voidable title because at the time of sale, she is a minor
B. X can ask for rescission of the sale to Y because she suffered a lesion of more than ¼ of
the value of the property.
C. If Y is in bad faith, Y becomes the owner of the necklace upon delivery to him but
his title is voidable.
D. X can ask for the annulment of the sale to Y because at the time of sale she is a minor.

This serves as a proof of the perfection of the contract of sale
A. Dacion en pago
B. Option money
C. Delivery
D. Arras

A contract of sale is not a(an)
A. Onerous contract
B. Accessory contract
C. Commutative contract
D. Bilateral contract

Warranty against hidden defects is
A. An essential element
B. A natural element
C. An accidental element
D. An artificial element

When a sale of a piece of land or any interest therein is through an agent, the authority of the
agent shall be in writing, otherwise the sale is
A. Valid
B. Voidable
C. Unenforceable
D. Void

The sale of an expected thing
A. Dacion en pago
B. Payment by cession
C. Emptiospei

D. Emptio rei-speratae

The sale of the hope itself
A. Dacion en pago
B. Payment by cession
C. Emptio spei
D. Emptio rei-speratae

One of the following is not correct
A. Things subject to a resolutory condition may be the object of the contract of sale.
B. A thing is generic when it is particularly designated or physically segregated from
all others of the same class.
C. Things having a potential existence may be the object of the contract of sale.
D. The sole owner of a thing may sell an undivided interest therein

X needs a size of 10 of model 101 of Leather Shoes regularly available to the public for her
boyfriend Z, but the same is out of stock so she placed an order for one. On the other hand, Z
placed an order for size No. 8, colored violet, (something not ordinarily made by the
company) to be given to X. Which is correct?
A. Both are contracts of sale
B. Both are contracts for a piece of work
C. First is a contract of sale second is a contract for a piece of work
D. First is a contract for a piece of work, second is a contract of sale

V offered to sell for P12,000,000 her house and lot to DD who was interested in buying the
same. In her letter to DD, V stated that she is giving DD a period of one month within which
to raise the amount and that as soon as DD is ready, they will sign the deed of sale. Five days
before the expiration of the one month period. V went to DD and told her that she is no
longer willing to sell the property unless the price in increased to P15,000,000. Which is
correct?
A. DD may compel V to accept the P12,000,000 first offered.
B. V may compel DD to pay P15,000,000
C. V and DD should shoulder the P3,000,000 difference
D. DD cannot compel V to accept the P12,000,000 first offered

If the object of the contract is specially made or manufactured at the specific order of
another, it is a contract for a piece of work. This is

A. English rule
B. Massachusetts rule
C. New York rule
D. Chicago rule

If the article already exists and subsequently acquired by another, it is a contract of sale, and
if the article is still to be manufactured at the instance of another, it is a contract for a piece
of work. This is
A. English rule
B. Massachusetts rule
C. New York rule
D. Chicago rule

If the material used in the manufacturer of the article is more valuable, it is a contract of sale, and if the labor or skill is more valuable than the material used in the manufacture of
the article, it is a contract for a piece of work. This is
A. English rule
B. Massachusetts rule
C. New York rule
D. Chicago rule

The rule observed in the Philippines is
A. English rule
B. Massachusetts rule
C. New York rule
D. Chicago rule

The Realty Installment Buyer Protection Act applies to all transactions involving the sale or
financing of real estate on installment but it excludes the following except:
A. Sale or financing of industrial lots
B. Sale or financing of commercial building
C. Sale to tenants under the Land Reform Code
D. Sale of residential condominiums

Delivery by merely pointing to the object of sale if it cannot be delivered to the vendee at the
time of the sale is
A. Traditio longa manu
B. Traditio brevi manu
C. Traditio constitutum possessorium
D. Traditio symbolica

Effected when the object of sale is already in the possession of the vendee at the time of sale
so that delivery need no longer be made is
A. Traditio longa manu
B. Traditio brevi manu
C. Traditio constitutum possessorium
D. Traditio symbolica

When the owner of the thing sells it to vendee, but continues to have possession or
occupation of the thing not as owner but as tenant or lessee
A. Traditio longa manu
B. Traditio brevi manu
C. Traditio constitutum possessorium
D. Traditio symbolica

Goods are deemed in transit
A. When the buyer accepts delivery of the goods upon arrival at destination
B. When the buyer intercepts and lawfully takes possession of the goods at any point before
destination.
C. From the time they are delivered by the seller to a common carrier or other bailee
for transmission to the buyer, up to the time that the buyer or his agent takes
delivery of the goods from the carrier or bailee.

D. When the carrier or bailee, upon arrival of the goods at destination acknowledges to the
buyer or his agent that he is holding the goods as bailee for the latter.

Goods are deemed no longer in transit
A. If the goods are rejected by the buyer for a valid reason and the carrier or other bailee
continues in possession of them, even if the seller has refused to receive them back.
B. From the time they are delivered to a carrier by land, water or air for the purpose of
transmission to the buyer.
C. From the time they are delivered to a bailee for the purpose of transmission to the buyer
until the buyer or his agent in that behalf, takes delivery of them from such bailee.
D. If the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or
his agent in that behalf.

X sold to V orally a parcel of land for P200,000. X effected the delivery of the land. The
payment of the price was to be made three month later. At the end of three month period
A. V may refuse to pay claiming in his defense the Statute of Frauds
B. V may return the parcel of land to X
C. X can collect from V because the contract has already been executed
D. V may refuse to pay on the ground that there is no written contract to support the sale.

On January 15, 2010, X sold for P2M her house and lot to V. It was agreed that delivery of
the house and lot, and the payment therefore, would be made on March 10, 2010.
Unfortunately, Z a stranger negligently set the house on fire on February 25, 2010, and the
house was completely destroyed. Which is correct?
A. V is not required to pay the P2M since the contract had no subject matter.
B. X must still deliver the lot but is excused from delivering the house, while V must
still pay the P2M
C. X must deliver the lot while V should pay only the amount equivalent to the value of the
lot.
D. X need not deliver the lot while V need not pay the P2M

If immovable property should have been sold to different vendees, the ownership shall be
transferred to the person
A. Who have first taken possession in good faith
B. Who presents the oldest title in good faith
C. Who in good faith first recorded it in the Registry of Property
D. Who have paid in good faith the purchase price in full

Using the preceding number, if movable property, it shall belong to the person
A. Who have paid in good the purchase price in full
B. Who in good faith first recorded it in the Registry of Property
C. Who presents the oldest title in good faith
D. Who have first taken possession in good faith

Action by the vendee against the vendor to nullify the sale due to some vices or defects
which render the object of sale unfit for the use intended or knowledge of which the vendee
should not have bought the thing
A. Accion quanti minoris
B. Accion reinvidicatoria
C. Accion pauliana
D. Redhibilitory action

Action to seek a corresponding reduction in price by reason of some vices or defects in the
thing purchased
A. Accion quanti minoris
B. Accion reinvidicatoria
C. Accion pauliana
D. Redhibilitory action

The redhibitory action based on the faults or defects of animals must be brought within
A. 30 days from delivery to the vendee
B. 40 days from delivery to the vendee
C. 45 days from delivery to the vendee
D. 6 months from delivery to the vendee

In contract of sale, if the price is absolutely simulated, the sale is
A. Unenforceable
B. Voidable
C. Void
D. Rescissible

In a contract of sale, of personal property, the price of which is payable in installments, the
vendor may exercise any of the following remedies, except
A. Exact fulfillment of the obligation, should the vendee fail to pay any installment
B. Cancel the sale, should the vendee’s failure to pay cover two or more installment
C. Foreclose the chattel mortgage on the thing sold, if one has been constituted should the
vendee’s failure to pay cover two or more installments
D. Rescind the sale should the vendee fail to pay any installment.

The right of the seller to stop goods in transit, upon discovering that the buyer does not have
the funds to pay for the goods
A. Pre-emptive right
B. Appraisal right
C. Voting right
D. Right of stoppage in transit

A sold to B a parcel of land for P3.8M. The sale is evidenced by a memorandum of
agreement of sale written in the Bicolano dialect. One week later, A sold the same parcel of
land to C for P4M. This is evidenced by a formal deed of sale. Upon buying the property, C,
who was aware of the first sale immediately took possession of the lot. When informed of
the second sale, B subsequently registered an adverse claim to the property. Later, C
registered the deed of sale in her favor. The parcel of land shall belong to
A. B because he has got an older title
B. C because he is the first to register
C. C because he is the first to take possession
D. No one as both sales are void

Voluntary renunciation made by the buyer of his right to warranty against eviction where in
case the buyer is evicted, the seller is liable to the value of the thing at the time of eviction.
A. Waiver intentionada

B. Waiver consciente
C. Waiver cursunada
D. Waiver inocente

Using the preceding number, where the seller is no longer liable
A. Waiver intentionada
B. Waiver consciente
C. Waiver cursunada
D. Waiver inocente

A contract of sale whereby the seller acquires the right to redeem or repurchase the object of
the sale from the buyer within a certain period agreed upon
A. Equitable mortgage
B. Absolute sale
C. On sale or return
D. Pacto de retro sale

A sold to B his car and promised to deliver ten days later. The next day, after the sale to B,
A sold the same car to C and immediately affected delivery. On the day agreed upon, A did
not deliver the car to B. Which is correct?
A. B can cancel the contract between A and C, because the contract between A and B was
perfected ahead of the contract between A and c
B. B should make the demand to make A in default
C. A is liable to B for the value of the car plus damages after B makes a demand
D. A is liable to B for damages and is in default without need of any demand

X sold to V her Yamaha organ. It was agreed that X would fix the price a week later. At the
agreed time, X named the price P10,000. V agreed. Was the sale perfected?
A. No, because the price was left to the discretion of one of the contracting parties
B. No, because at the time of sale the price was not fixed
C. Yes, because the price fixed by one of the parties was accepted by the other
D. Yes, because there was agreement that X would fix the price

Not an implied warranty in a contract of sale
A. Right to sell the thing at the time of perfection of the contract
B. Reasonably fit for the purpose they are acquired
C. Merchantable in quality
D. Free from charges or encumbrances not declared or known to the buyer

After the death of C, A, C’s son, sold his inheritance though its amount has not yet been
determined to B for a consideration of P1,000,000. Which is correct?
A. The contract is valid if the value of inheritance is at least equal to P1,000,000
B. The contract is valid even though the inheritance to be turned over to B is less than
P1M
C. The contract is void as future inheritance cannot be the object of sale
D. The contract is unenforceable

X stole a fountain pen from P and sold it to Z Merchandise, a “store for pens”, which paid for
it in good faith, not knowing it was stolen. The “store” then sold it to C, a student.Which is
correct?

A. C cannot be considered as the owner because the original seller (X) is not the real owner.
B. P may recover the fountain pen from C without reimbursement because he is the legal
owner.
C. C became the owner because he purchased the pen from a merchant store
D. C became the owner regardless of whether the seller is a store for pens or not because C
bought it in good faith.

When goods are delivered to the buyer on “sale or return” for period of seven days,
ownership of the goods passes to the buyer
A. Upon perfection of the contract
B. Upon acceptance by the buyer of the offer of the seller
C. Upon expiration of seven days
D. Upon delivery of the goods

Quasi-traditio is equivalent to
A. Traditio longa manu
B. Traditio brevi manu
C. Traditio constitutum possessorium
D. Execution of a public instrument

Vi imported radios from Taiwan and asked for 220 volts radios. The radios arrived clearly
labeled 220 volts and Vi sold them to the public as such. Later the customer complained that
the radios have been mislabeled by the manufacturer and that they were good only for 110
volts. As a consequence
A. Vi is liable to the vendees for any hidden defects even though he is not aware.
B. Vi is not liable because he is in good faith
C. Vi is not liable under the principle of “caveat emptor” or let the buyer beware
D. The vendees may hold the manufacturer liable but not Vi because Vi specifically asked
for 220 volts

If the redemption is to be made by the seller, one of the following need not be given to the
Buyer
A. Expenses of the contract
B. Interest on the price of the sale
C. Necessary expenses on the thing sold
D. Price of the sale

Not an element of the sellers right of stoppage in transit
A. The goods must be in transit
B. The buyer must be insolvent
C. The seller must be in possession of the goods
D. The seller must be unpaid

A sold his only car to B for P300,000 to be paid as follows: P150,000 upon delivery of the
car to B and the balance at P10,000 per month until full payment of the purchase price. Later
the car gets burned in the possession of B through fortuitous event and without B’s fault,
before full payment of the balance. Is B obliged to pay the balance?
A. No, because the car was lost through fortuitous event and without B’s fault, hence B’s
obligation is extinguished.
B. No, because the loss should be borne by the seller as this an installment sale so until the
buyer pays the full amount of the price of the sale, A remains to be the owner.

C. Yes, but A must give another car to B because of the principle “genus nunquam perit” or
generic thing never perishes
D. Yes, because the principle “res perit domino” or the thing perishes with the owner.

A, B and C are co-owners of an undivided parcel of land, A sold his 1/ 3 interest to B
absolutely. Which is correct?
A. C may exercise his right of redemption of the interest sold by A to B
B. C cannot exercise the right of redemption because the sale was made in favor of a
co-owner
C. The sale made by A to B is void because it was not made in favor of a stranger
D. C may redeem only 1 /2 of the interest sold by A to B

A, B and C are co-owners of an undivided parcel of land, A sold his 1/ 3 interest to B
absolutely. Using the preceding number, suppose, instead of selling his interest to B, A sold it to D, who
can exercise the right of redemption?
A. Both B and C
B. B but not C
C. C but not B
D. A, B and C

Which of the following cannot be the object of a contract of sale?
A. Sale of credit
B. Young animal not yet conceived at the time of perfection
C. Land which the seller expects to buy
D. Future inheritance

A offered for sale to B 20 cavans of wagwag rice and fixed the price per cavan at P10 over
the price offered at Z’s store in Cainta Market. The price is
A. Not certain because the price at Cainta Market is not stated
B. Certain because it has got reference to another thing which is certain
C. Certain because there is a price ceiling for price of land
D. Not certain so court may fix the price

X sold his motor vehicle to V who bought it for P200,000. It turned out however, that X has
2 motor vehicles: Toyota valued at P230,000 and Lancer valued at P220,000. Which is
correct?
A. There is no contract of sale between X and V
B. The parties may ask for interpretation or reformation
C. The parties can ask for annulment of the contract
D. V may choose between the Toyota or Lancer

X offers to V 100 electric fans for P80,000 payable in 60 days with 12% interest per annum.
V accepted the offer by telegram provided that interest is reduced to 6%. If there is no
further communication between X and V relating to the terms
A. The contract is perfected because of the acceptance by V
B. There is no contract yet between X and V because V made a counter offer
C. The contract is perfected under the terms of X
D. There is no contract yet unless v gives earnest money

X owns 50 mango trees bearing fruits, ready for harvest. She told all the fruits of all the trees
to V who paid P100,000. X told V that he can harvest her fruits anytime he likes and pointing at the mango trees. For legal purposes, X has fulfilled her obligation to deliver the
mango fruits to V by
A. Traditio longa manu
B. Traditio brevi manu
C. Traditio constitutum possessorium
D. Execution of a public instrument

X sold her specific car to V for P200,00 payable in 5 equal installments. X delivered the car
to V but a mortgage was constituted on the car to answer for the unpaid installments. V paid
the first 2 installments but failed to pay the last 3 installments. X foreclosed the mortgaged
property and sold it at public auction for P100,000. Which is correct?
A. X can recover from V the balance of P20,000 even if there is no stipulation to that effect
B. X can recover from V the balance of P20,000 if there is stipulation to that effect
C. X cannot recover the deficiency except if there is stipulation to that effect
D. X cannot recover the deficiency even if there is stipulation to the contrary

Ownership of the thing sold is
A. Retained by the seller in “sale or return
B. Transferred to the buyer upon constructive or actual delivery of the thing sold
C. Acquired by the buyer upon perfection of the contract
D. Transferred to the buyer upon acceptance of the price

X sold his horse to Y for P40,000. No payment has yet been made and the sales document
does not provide the date of delivery. Before delivery and payment the horse gave birth to a
baby horse, which is correct?
A. Y is entitled to the baby horse which was born after the perfection of the contract
B. X is entitled to the fruit (baby horse) as Y has not paid the price yet
C. X is entitled to the (baby horse) because it was born before his obligation to deliver arises
D. Y should pay additional amount for the baby horse to be entitled to it

A contract of sale is in the stage of conception when
A. There is meeting of the minds
B. Negotiations are in progress
C. The parties come to an agreement
D. The contract is perfect

A seller sold to a buyer a piece of jewelry at a price of P25,000. The contract provides that
the buyer will pay the seller cash, P20,000 and for the balance, the buyer will give the seller
a micro oven worth P5,000. What is the nature of the contract?
A. Sale
B. Partly sale partly barter
C. Barter
D. Commodatum

X, the guardian of V, sold V’s house and lot worth P480,0000 for P430,000
A. The contract can be rescinded because of inadequacy of price
B. The contract cannot be rescinded because there is no fraud, mistake or undue influence
C. The contract cannot be rescinded because all the elements of a contract are present
D. The contract can be rescinded by X.

X leased to V a 5 Freezer for two years at a lease rental fee of P1,000 per month and signed
an option in favor of V to buy the freezers at the end of the term of the lease at P50,000. All
rental fee paid are to be considered as partial payment of the sale. After 12 months V was
able to pay the rental fee for 9 months and was in arrears for three months. X terminated the
lease contract and repossessed the freezers. The consequence of the transaction is
A. X can collect the rental fees for three months which are in arrears.
B. X can collect the rental fees for the unexpired 12 months of the lease contract.
C. When X took possession of the freezer, he has no further action against V
D. X in terminating the lease and repossessing the freezer is obliged to refund the 9 months
rental fee, paid by V even if there is a stipulation to the contrary

X sold his car to Z for P60,000. No date was fixed for the performance of the obligation of
the seller and the buyer. The obligation of X is
A. To deliver the car immediately because the sale is a perfected contract
B. To deliver the car only after Z writes to X demanding the delivery of the car.
C. To deliver the car only after Z pays the P60,000
D. To rescind the contract because there is no time fixed for the delivery

I. The vendor need not be the owner at the time the sale is perfected. It is sufficient that he is
the owner at the time the thing sold is delivered.
II. The sale of a vain hope or expectancy is voidable.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false.

I. There may be a contract of sale of goods, whose acquisition by the seller depends upon a
contingency which may or may not happen.
II. If the consideration of the contract consists partly in money and partly in another thing, it
shall be considered a barter if the value of the thing given as a part of the consideration
exceeds the amount of the money or its equivalent.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. If the price is grossly inadequate, the sale is void.
II. Whenever option money is given in a contract of sale, it shall be considered as part of the
price and a proof of the perfection of the contract.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. Earnest money and option money both apply to perfected sale.
II. In a contract of sale of personal property the price of which is payable in installment, the
vendor may cancel the sale should the vendee fail to pay

A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. Should the vendee’s failure to pay, cover two or more installments, the vendor may
foreclose the chattel mortgage on the thing sold but he shall have no further action against
the purchaser to recover any unpaid balance of the price, except if there is an agreement to
the contrary.
II. Sale is a consensual contract, therefore delivery or payment is not essential for perfection.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. The ownership of the thing sold shall be transferred to the vendee upon perfection of the
contract.
II. An unaccepted unilateral promise to buy or to sell a determinate thing for a price certain
is binding upon the promissory.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. The husband and the wife cannot sell property to each other, as a rule.
II. The sale of a piece of land or interest therein when made thru an agent is void unless the
agent’s authority is in writing even if the sale itself is in s public instrument and has been
registered.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. The expenses for the execution and registration of the sale shall be borne by the vendee,
unless there is a stipulation to the contrary.
II. If the same thing should have been sold to different vendees the ownership shall be
transferred to the person who may have taken possession thereof in good faith.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. Any stipulation exempting the vendor from the obligation to answer for eviction shall be
void.
II. The vendor is responsible to the vendee for any hidden faults or defects in the thing sold
only if he was aware thereof.
A. First statement is true, second statement is false

B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. If the animal sold should die within three (3) days after its purchase, the vendor shall be
liable to the vendee.
II. The fixing of the price can never be left to the discretion on one of the contracting parties.
However, if the price fixed by one of the parties is accepted by the other, the sale is
perfected.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. Option money is considered as part of the purchase price while earnest money is not.
II. The Maceda Law refers to the sale of personal property by installments while the Recto
Law refers to the sale of real property by installments.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. If two or more animals are sold together, whether for lump sum or for a separate price for
each of them, the redhibitory defect of one shall give rise to the redhibition of the others.
II. There is no warranty against hidden defects of animals sold at fairs or at public auctions
or of livestock sold as condemned.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. The ownership in the thing shall not pass to the purchaser until he has fully paid the price.
II. If at the time the contract of sale is perfected, the thing which is the object of the contract
has been partially lost, the contract shall be without effect.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

I. Where the seller of goods has a voidable title thereto, but his title has not been avoided at
the time of the sale, the buyer acquires a good title to the goods.
II. If the vendee has renounced the right to warranty in case of eviction, and eviction should
take place, the vendor shall only pay the value which the thing sold had at the time of sale.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.

D. Both statements are false

I. Unless otherwise agreed, the buyer of goods is not bound to accept delivery thereof by
installment.
II. In case of doubt, a contract purporting to be an equitable mortgage shall be construed as a
sale with a right to repurchase.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false

The creditors of the vendor cannot make use of the right of redemption against the
vendee, until they have exhausted the property of the vendor.
II. Sale is a real contract because delivery is necessary to transfer ownership to the buyer.
A. First statement is true, second statement is false.
B. First statement is false, second statement is true.
C. Both statements are true.
D. Both statements are false