Law on Sales
Every business transaction you will ever audit, record or advise on starts as a contract. This one — the sale — is the contract the Civil Code spends a hundred and eighty articles on, because almost everything else is built on top of it.
From Article 1458 to the Maceda Law, with the cases you can classify yourself, the ladders you can walk, and the numbers you can actually compute.
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Nature and form of the contract of sale
Before anything else: what makes a sale a sale, and how do you tell it apart from the five contracts that look exactly like one?
"By the contract of sale one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent. A contract of sale may be absolute or conditional."
Read the article as three obligations
The seller owes two things — transfer ownership and deliver — and the buyer owes one: pay the price. Notice what Art. 1458 does not say. It does not say the seller must own the thing at the time of the sale. He must be able to transfer ownership at the time of delivery, which is why a sale of a thing you do not yet own is perfectly valid.
The three stages
① Negotiation
Also called policitacion. From the moment the buyer shows interest to the moment before the minds meet. Offers, counter-offers, options. Nothing is demandable yet.
② Perfection
Art. 1475 — the moment there is a meeting of minds upon the thing and upon the price. From here the parties may reciprocally demand performance.
③ Consummation
Performance: delivery of the thing and payment of the price. Ownership passes here, at delivery — not at perfection.
Elements of a contract of sale
Consent · Object · Cause
Consent of the contracting parties, a determinate object, and a cause — the price certain in money or its equivalent. Take one away and the contract is void, not merely defective.
The two warranties
Warranty against eviction and warranty against hidden defects. Nobody has to stipulate them; they come with the sale. The parties may increase, diminish or waive them.
Everything stipulated
Terms of payment, interest, place and time of delivery, packaging, penalties, conditions. Present only because the parties put them there.
Characteristics
| Characteristic | What it means | Why it matters |
|---|---|---|
| Consensual | Perfected by mere consent, not by delivery and not by a written form. | An oral sale of a car is already binding. The deed only proves it. |
| Bilateral and reciprocal | Both parties are bound, and each one's obligation is the cause of the other's. | Neither may demand performance while himself in default. |
| Onerous | Valuable consideration flows both ways. | Distinguishes it from a donation, whatever the deed is titled. |
| Commutative | The values exchanged are regarded as equivalent. | But a sale may be aleatory instead — emptio spei is the standing example. |
| Nominate | The law gives it a name and its own set of rules. | Those rules fill every gap the parties left. |
| Principal | It stands on its own; it does not secure another obligation. | Unlike a mortgage or a pledge — which is exactly the point of Art. 1602. |
Kinds of contract of sale
| Classified by | Kinds |
|---|---|
| Nature of the object | Sale of real property · sale of personal property |
| How the object is designated | Sale of a specific (determinate) thing · sale of a generic thing |
| Presence of a condition | Absolute — no condition attached · Conditional — subject to a condition, e.g. full payment |
| How the price is paid | Cash sale · sale on installment · sale on credit |
| How the price is fixed | Fixed by the parties · by a third person · by reference to a market or exchange |
| Validity | Valid · rescissible · voidable · unenforceable · void |
The five look-alikes
| Contract | The deciding test | Where it differs from a sale |
|---|---|---|
| Piece of work Art. 1467 |
Would the maker have produced this thing for the general market anyway? | If it was made specially for this customer and not in the ordinary course of business, it is a piece of work — governed by the law on contracts for a piece of work, not on sales. |
| Barter Art. 1468 |
Intention first. If unclear, compare the thing given against the money given. | Thing worth more than the money → barter. Money equal to or more than the thing → sale. |
| Dation en pago Art. 1245 |
Is there a pre-existing debt being extinguished? | In a sale an obligation is created; in dation one is extinguished. The debt itself is the price. Governed by the law on sales all the same. |
| Agency to sell | Does he sell for his own account, or for the owner's? | An agent never becomes owner, bears no risk, must account for the proceeds, and returns what he cannot sell. A buyer keeps the profit and the loss. |
| Contract to sell | Was ownership reserved until full payment? | Full payment is a positive suspensive condition: if it fails, the obligation to sell never arises, so there is nothing to rescind. In a true sale, non-payment is a negative resolutory condition and the seller must go to court. |
Why the contract-to-sell distinction is worth marks
Three consequences follow from it, and examiners test all three. In a contract to sell: (1) ownership stays with the seller no matter how many installments were paid; (2) the seller need not file an action for rescission, because the obligation never became demandable; and (3) Art. 1544 on double sales does not apply — there was never a first sale for a second buyer to be in bad faith about.
Selling something that does not exist yet
Emptio rei speratae — the expected thing
The object is the thing itself, expected to come into existence. The sale is subject to the condition that it does. If it never does, there is no contract and the price goes back.
The uncertainty is over the quantity or quality — how many sacks the harvest yields, not whether there will be a harvest at all.
Emptio spei — the hope
The object is the hope or expectancy itself. The buyer pays for the chance, so the sale is valid and enforceable even if nothing materialises. He does not get his money back.
One limit: the sale of a vain hope — a chance that could never have come about — is void.
The tie-breaker
Where a future thing is sold and the wording is ambiguous, the law presumes emptio rei speratae. Emptio spei has to be clear from the agreement — "catch or no catch", "whatever the net brings up", "win or lose".
Determinate thing, and the kinds of goods
When is a thing determinate?
When it is particularly designated or physically segregated from all others of the same class. "My 2019 Toyota Vios with plate ABC 1234" is determinate. "A Toyota Vios" is generic.
The second sentence saves many contracts: the requisite is complied with if at the time the contract is entered into, the thing is capable of being made determinate without the necessity of a new or further agreement between the parties.
Kinds of goods
Existing goods — owned or possessed by the seller at the time of
perfection.
Future goods — to be manufactured, raised or acquired by the seller after
perfection.
Specific — identified and agreed upon.
Generic — designated only by class.
Fungible — replaceable by an equal quantity of the same kind (rice, oil,
cement). Non-fungible — not so replaceable.
The price, the auction, and the money on the table
A sale can fail on the price alone. Three requisites, four possible effects, and a distinction — earnest money against option money — that decides whether a buyer is bound at all.
The three requisites of a valid price
① Real
The parties genuinely intend it to be paid and demanded. A price nobody ever meant to collect is simulated — and under Art. 1471 the sale is void.
② In money or its equivalent
Cash, a cheque, shares, a credit — anything with a money value. What it may not be is another thing outright, or the contract slides into barter.
③ Certain or ascertainable
It need not be a number in the deed. It is enough that it can be worked out without a new agreement between the parties.
How a price becomes certain
| Article | How | Watch for |
|---|---|---|
| 1469 | Fixed with reference to another thing certain, or left to the judgment of a specified third person. | If that person cannot or will not fix it, the contract is inefficacious unless the parties agree on something else. If he acts in bad faith or by mistake, the courts may fix it. If a party prevents him from acting, the innocent party has remedies. |
| 1472 | By reference to a definite day, particular exchange or market. | Perfectly valid. This is how commodity and securities sales are priced. |
| 1470 | Gross inadequacy of price. | Does not affect the sale. It is only evidence — of vitiated consent, or of an intended donation. |
| 1471 | The price is simulated. | The sale is void. But the act may be proved to be in reality a donation or another contract, and stand as that. |
| 1474 | The price cannot be determined at all. | The contract is inefficacious — unless the thing was delivered to and appropriated by the buyer, in which case he must pay a reasonable price. |
Sale by auction · Art. 1476
When the hammer falls
1. Goods put up in lots — each lot is the subject of a separate contract of sale.
2. The sale is perfected when the auctioneer announces it by the fall of the hammer or in other customary manner. Until then, any bidder may retract his bid, and the auctioneer may withdraw the goods — unless the auction was announced to be without reserve.
3. A right to bid may be reserved expressly by or on behalf of the seller. 4. Where no such notice was given, it is unlawful for the seller to bid, to employ anyone to bid for him, or for the auctioneer to knowingly take such a bid. Any sale that contravenes this may be treated by the buyer as fraudulent.
By sample, by description · Art. 1481
Sale by sample — the bulk must correspond with the sample in kind and quality, and there is an implied warranty that the goods are free from any defect not apparent on reasonable examination of the sample which renders them unmerchantable.
Sale by description — the goods must correspond with the description. Sold by sample and description, the bulk must satisfy both.
Either way the buyer must be given a reasonable opportunity to compare the bulk with the sample or the description.
Expropriation · Art. 1488
"The expropriation of property for public use is governed by special laws." It is a forced sale: the owner's consent is supplied by the State's power of eminent domain, and the price is the just compensation fixed by the court. The Civil Code rules on sales apply only where the special laws leave a gap.
Earnest money against option money
| Earnest money · Art. 1482 | Option money | |
|---|---|---|
| State of the sale | Already perfected — the earnest money proves it | Not yet perfected; it buys time to decide |
| Part of the price? | Yes — deducted from the balance | No, unless the parties agree it will be |
| Is the giver bound to buy? | Yes. He is a buyer, and failing to pay the balance is a breach | No. He may simply let the period lapse and lose the option money |
| What it is for | Proof of the perfected sale and partial performance | The separate consideration that makes an accepted unilateral promise binding — Art. 1479 |
| If the deal falls through | The rules on breach and rescission of a sale apply | The would-be seller simply keeps it; no sale ever existed |
Form · Art. 1483 and the Statute of Frauds
A sale may be made in writing, orally, partly both, or inferred from conduct — subject to the Statute of Frauds (Art. 1403[2]). Under it, an agreement for the sale of real property or an interest therein, and a sale of goods worth ₱500 or more, must be in writing to be enforceable — otherwise the contract is valid but unenforceable by action, and the defect is cured by ratification or by acceptance of part performance.
Who may buy and sell — and what if the thing is already gone?
Capacity is the general rule and incapacity the exception. The examinable part is never the rule; it is which incapacity makes a sale merely voidable and which makes it flatly void.
Anyone who can obligate himself
All persons who are authorised in the Civil Code to obligate themselves may enter into a contract of sale. Capacity is presumed; whoever alleges incapacity must prove it.
Necessaries sold to a minor
Where necessaries are sold and delivered to a minor or another person without capacity to act, he must pay a reasonable price for them. Necessaries are everything indispensable for sustenance, dwelling, clothing, medical attendance, education and transportation.
Two kinds of incapacity
They cannot bind themselves at all
Minors, insane or demented persons, and deaf-mutes who do not know how to write. The incapacity follows the person into every contract.
Effect: the sale is voidable — valid until annulled, and ratifiable once capacity is acquired. Where both parties are incapacitated, it is unenforceable.
Only as to certain persons or certain property
A guardian is perfectly capable of buying a house — just not his ward's house. The incapacity attaches to a relationship, not to the person.
Effect: it depends on whose interest the prohibition protects. Tap through them below.
The one line that decides every Art. 1491 item
Nos. 1 to 3 — guardian, agent, executor — protect a private interest, so the person protected can ratify and the sale is merely voidable. Nos. 4 to 6 — public officers, judges and lawyers, and those specially disqualified by law — rest on public policy, which nobody can waive, so the sale is void.
When the thing sold has been lost
"Lost" has a technical meaning taken from Art. 1189: a thing is lost when it perishes, or goes out of commerce, or disappears in such a way that its existence is unknown or it cannot be recovered. Everything then turns on when.
Obligations of the vendor
Five duties, one of which — delivery — carries the whole law of ownership on its back, and two of which are the warranties every buyer gets without asking.
① Transfer ownership
He need not own it at perfection, but he must be able to transfer ownership at delivery.
② Deliver the thing
With its accessions and accessories, in the condition it was in at perfection, plus the fruits from that moment (Art. 1537).
③ Warrant the thing
Against eviction and against hidden defects. Natural elements — they exist without being written.
④ Preserve it pending delivery
With the diligence of a good father of a family. He is answerable for loss through his own fault.
⑤ Pay for the deed
Art. 1487 — the expenses for the execution and registration of the sale are borne by the vendor, unless stipulated otherwise.
Where it all leads
Ownership passes on delivery, not on perfection and not on payment. Almost every ownership question reduces to: was there delivery?
The eight ways a thing gets delivered
Brevi manu and constitutum possessorium are mirrors
In traditio brevi manu the possessor stays put and his title improves — the lessee becomes owner. In constitutum possessorium the possessor stays put and his title shrinks — the owner becomes lessee. In both, nothing physically moves; only the character of the possession changes, and that is enough.
When the same thing is sold twice · Art. 1544
The article gives a strict order of preference, and every rung of it is gated on good faith. Change the facts below and watch which rung decides the case.
Warranty against eviction · Art. 1548
Eviction takes place when, by a final judgment based on a right prior to the sale or an act imputable to the vendor, the vendee is deprived of the whole or of a part of the thing purchased. Tick the requisites that are present.
Warranty against hidden defects · Art. 1561
The vendor answers for hidden defects that render the thing unfit for its intended use, or diminish its fitness so far that the vendee would not have bought it or would have paid less.
Non-apparent burdens
An immovable sold with a non-apparent servitude or easement not mentioned in the agreement, of such a nature that the buyer would not have bought it had he known, lets him ask for rescission within one year from the execution of the deed — or, after that year has passed, sue for damages within one year from his discovery of the burden.
Redhibitory defects of animals
A hidden defect of an animal is redhibitory even if a professional inspection failed to reveal it. The action prescribes in forty days from delivery. A sale of animals is void if the animal was suffering from a contagious disease, or is unfit for the use for which it was acquired. If the animal dies within three days of purchase from an illness that already existed, the vendor answers.
Obligations of the vendee
Shorter than the vendor's list, and misleadingly so — the interesting questions are when he must pay, when he may refuse to, and what the seller can do about it.
① Accept delivery
Art. 1582 — take the thing as and where the contract says.
② Pay the price
At the time and place stipulated. If nothing was stipulated, at the time and place of delivery.
③ Bear the agreed expenses
Execution and registration, and putting the goods in a deliverable state — only if stipulated. Absent a stipulation, Art. 1487 puts them on the seller.
Examining, accepting, refusing
| Article | Rule | The catch |
|---|---|---|
| 1584 | The buyer is not deemed to have accepted goods he has not previously examined until he has had a reasonable opportunity to examine them. | Except in a C.O.D. sale — there he is not entitled to examine before payment, unless the parties agreed otherwise. |
| 1585 | He is deemed to have accepted when he (a) tells the seller so, (b) does an act inconsistent with the seller's ownership, or (c) retains the goods after a reasonable time without saying he rejects them. | Item (c) is the trap. Silence plus time is acceptance. |
| 1586 | Acceptance does not discharge the seller from liability for breach of warranty. | But the buyer must give notice of the breach within a reasonable time, or the seller is not liable. |
| 1587 | Having rightfully refused, the buyer is not bound to return the goods; it is enough that he notifies the seller of his refusal. | If he voluntarily constitutes himself a depositary, he is liable as one. |
| 1588 | Where the buyer wrongfully refuses to accept, the goods are at his risk from the time of the seller's tender. | The refusal must be wrongful; a justified refusal leaves the risk on the seller. |
When does the buyer owe interest?
Between the delivery of the thing and the payment of the price, in three cases only:
1. It was stipulated.
2. The thing delivered produces fruits or income — he should not enjoy
both the fruits and the use of the money.
3. He is in default, from the time of judicial or extrajudicial
demand.
When may he stop paying?
If he is disturbed in possession or ownership, or has reasonable grounds to fear such disturbance, by a vindicatory action or a foreclosure of mortgage — he may suspend payment until the danger ceases.
Three ways he loses that right: the seller gives security for the return of the price; the parties stipulated that he pays regardless; or the disturbance is a mere act of trespass, which never justifies suspension.
If the buyer does not perform
| Article | Subject | Remedy of the seller |
|---|---|---|
| 1591 | Immovable | Where he has reasonable grounds to fear the loss of the immovable and its price, he may immediately sue for rescission. If no such ground exists, Art. 1592 governs. |
| 1592 | Immovable | Even with an automatic-rescission clause, the buyer may still pay after the period as long as no demand for rescission has been made judicially or by a notarial act. Once that demand is made, the court may not grant him a new term. |
| 1593 | Movable | Rescission takes place of right, without need of demand, if the buyer fails to appear to receive the thing on the day fixed, or appears without tendering the price at the same time — unless a longer period for payment was stipulated. |
The unpaid seller's four rights · Arts. 1526–1535
Even after ownership has passed, an unpaid seller keeps: (1) a possessory lien on the goods while he still holds them; (2) the right of stoppage in transitu if the buyer becomes insolvent while the goods are on their way; (3) a special right of resale where the goods are perishable, or the right was reserved, or the buyer has been in default an unreasonable time; and (4) a special right to rescind, where it was expressly reserved or the buyer has been in default an unreasonable time.
Sales of real estate by area · Arts. 1539–1543
Sold at a rate per unit of measure and the area is short: the buyer may demand the missing area, or rescind if the lack is at least one tenth — or if the quality is so inferior he would not have bought it. Sold for a lump sum (a cuerpo cierto), the price does not change even if the actual area differs, because what was sold was the identified property, not the square metres. The actions prescribe in six months from delivery.
Breach of a sale of goods, and how a sale ends
Arts. 1594 to 1599 give each side its action. Then the sale ends — by the ordinary causes, or by the two that belong to sales alone.
What "goods" means · Art. 1636
"Goods" includes all chattels personal but not things in action (a credit, a receivable) and not money of legal tender in the Philippines. The term does include growing fruits or crops. That last clause matters: a standing harvest is goods, so Arts. 1594–1599 reach it.
Each side's action
| Who | Article | Action | Measure of damages |
|---|---|---|---|
| Seller | 1595 | Action for the price | The price itself. Available where ownership has passed and the buyer refuses to pay; or the price was payable on a certain day irrespective of delivery; or the goods cannot readily be resold and the buyer refuses to accept. |
| 1596 | Damages for non-acceptance | The estimated loss directly and naturally resulting in the ordinary course of events. Where there is an available market: the difference between the contract price and the market price at the time the goods ought to have been accepted. | |
| 1597 | Rescission | Where the goods have not been delivered and the buyer has repudiated, or shown his inability to perform, or breached — the seller may totally rescind by giving notice of his election. | |
| Buyer | 1598 | Specific performance | Where the seller has broken a contract to deliver specific or ascertained goods, the court may direct that the contract be performed specifically — and it need not give the seller the option of retaining the goods on payment of damages. |
| 1599 | Breach of warranty | Four remedies, and they are alternative. Work through them below. |
The buyer's four remedies for breach of warranty
Effect of rescission on the buyer's rights and obligations
Rescinding is not automatic — three things bar it. Tick any that are true of your fact pattern.
How a sale is extinguished · Art. 1600
Shared with all obligations
Payment or performance · loss of the thing · condonation or remission · confusion or merger · compensation · novation. Add annulment, rescission, fulfilment of a resolutory condition, and prescription.
Found in the Title on Sales
Rescission under Arts. 1591–1593 · the unpaid seller's right to rescind (1534) · rescission for deficiency in area (1539–1542) · rescission for eviction (1556) or for hidden defects (1567) · and the Recto Law's cancellation (1484).
Belonging to sales alone
Conventional redemption and legal redemption. Art. 1600 names them expressly, and the next section is entirely about them.
Equitable mortgage · Arts. 1602–1605
An equitable mortgage is a transaction that lacks the formalities of a mortgage but reveals the parties' intention to charge real property as security for a debt. The law lists six badges — and it takes only one.
Reformation · Art. 1605
Reformation is the remedy by which a written instrument is amended to express the parties' real agreement, where by mistake, fraud, inequitable conduct or accident it failed to do so. Note what it presupposes: a valid contract whose writing is wrong. It does not create an agreement; it corrects the paper. In Art. 1605 the apparent vendor of a pacto de retro or absolute sale that is really a mortgage may ask for exactly that — and the deed becomes what it always was, a mortgage.
Conventional and legal redemption
Two ways a sale can be undone by buying the thing back: one the parties created for themselves, and one the law hands to somebody who was not even a party.
Conventional redemption
Takes place when the vendor reserves the right to repurchase the thing sold, with the obligation to comply with Art. 1616 and whatever else was stipulated. The arrangement is called a pacto de retro sale.
The right must be reserved in the SAME instrument of sale. Reserved in a separate later document, it is not conventional redemption at all — it is a promise to sell, binding only if supported by its own consideration.
Legal redemption
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, by dation in payment, or by any other transaction transmitting ownership by onerous title.
Nobody agreed to it. It exists because the law prefers to keep co-ownership from spreading to strangers, and to consolidate uneconomically small parcels.
Pacto de retro is where equitable mortgages hide
Because a genuine pacto de retro sale lets the buyer consolidate ownership when the period lapses, it was for decades the standard way to disguise a usurious loan. That is precisely why Arts. 1602 to 1605 exist, why any one badge suffices, and why Art. 1603 says that in case of doubt the contract shall be construed as an equitable mortgage. Art. 1607 adds the procedural guard: the buyer may not record his consolidation of ownership without a judicial order obtained after the seller has been heard.
Who may redeem by force of law
What the redeeming seller must return
1. The price of the sale.
2. The expenses of the contract and any other legitimate payments made by
reason of the sale.
3. The necessary and useful expenses made on the thing sold.
A tender of the bare price is incomplete, and an incomplete tender does not
preserve the right.
Two rules that catch people out
Where several co-owners or co-heirs sold an undivided immovable with a right of repurchase, the buyer may demand that they all agree to repurchase the whole; he cannot be compelled to consent to a partial redemption. And under Art. 1613 the seller may not exercise the right at all without returning the price — intention is not enough.
Assignment of credits and other incorporeal rights
A receivable can be sold like anything else. What changes is what the seller is taken to have promised — and it is far less than students expect.
Definition
An assignment of credit is an agreement by which the owner of a credit — the assignor — transfers to another — the assignee — his rights and actions against a third person, the debtor, for a consideration or gratuitously.
Art. 1624 — it is perfected in the same manner as a sale: by mere consent. The assignee steps into the assignor's shoes, and under Art. 1627 the assignment carries all the accessory rights with it — guaranty, mortgage, pledge, preference.
Consent is not needed. Notice is.
The debtor's consent is not required — he is the object of the transaction, not a party to it — unless the credit itself forbids assignment.
Art. 1626 — a debtor who pays his original creditor before he learns of the assignment is released. That is why an assignee notifies at once. And Art. 1625 — the assignment produces no effect against third persons unless it appears in a public instrument, or, where real property is involved, is recorded in the Registry of Property.
What the assignor warranted · Art. 1628
Two letters and two exceptions
E and L — Existence and Legality of the credit are warranted always, unless the credit was expressly sold as doubtful. Solvency is not warranted, save in two cases: it was expressly stipulated, or the insolvency was prior to the sale and of common knowledge. Then, on the amount: good faith caps him at price + expenses; bad faith adds damages.
How long the warranty of solvency lasts · Art. 1629
Legal redemption of a credit in litigation · Art. 1634
When a credit or other incorporeal right in litigation is sold, the debtor may extinguish it by reimbursing the assignee the price he paid, the judicial costs he incurred, and the interest on the price from the day it was paid — within thirty days from the date the assignee demands payment from him. The point is to stop speculators from buying disputed claims cheaply and enforcing them at full value. Art. 1635 excepts assignments made to a co-heir or co-owner of the right, to a creditor in payment of his credit, and to the possessor of the property subject to the right in litigation.
Recto Law, Maceda Law and the Condominium Act
Three special laws, and one question that sorts them: what is being sold, and is it on installment?
Recto Law · Art. 1484
Personal property, payable in installments. The seller gets three remedies — and they are alternative, so taking one abandons the rest. Set the facts and elect one.
Maceda Law · RA 6552
Real property on installment. Everything turns on whether the buyer has paid at least two years of installments — the grace period, the refund, and whether there is a refund at all.
Recto and Maceda, side by side
Both protect an installment buyer, and students mix them up constantly. The split is simply the object: Recto is personal property, Maceda is real property. Recto restrains the seller's choice of remedy; Maceda gives the buyer time and money back. Recto's signature rule is that foreclosure kills the deficiency claim; Maceda's is the cash surrender value.
Condominium Act · RA 4726
The Subdivision and Condominium Buyers' Protective Decree
Where RA 4726 says what a condominium is, PD 957 governs how the project is sold. The developer must register the project and obtain a licence to sell; must not mortgage a unit without prior approval (Sec. 18); must complete the development within the time fixed (Sec. 20); and must deliver the title upon full payment (Sec. 25).
Sec. 23 — a buyer who stops paying because the developer failed to develop may be reimbursed the total amount paid, including amortisation interests but excluding delinquency interests, with interest at the legal rate. Sec. 24 sends ordinary non-payment back to RA 6552.
From HLURB to DHSUD
Under RA 11201 the Housing and Land Use Regulatory Board became the Department of Human Settlements and Urban Development (DHSUD), with adjudication transferred to the Human Settlements Adjudication Commission (HSAC). Older material still says HLURB — the rules are the same; the office that applies them has a new name.
Sort it: which stage of the sale?
Twelve things that happen in a sale. For each one, ask the single question: have the minds already met on the thing and the price? Drag it into a stage, or tap the token and then tap a stage.
Each stage answers a different question
Negotiation decides whether anyone is bound at all — and that is where option money lives. Perfection fixes the moment from which the parties may demand performance, and it is the date every prescriptive period counts from. Consummation is where ownership moves, because ownership passes on delivery.
Signing is not perfecting
A sale is consensual. It is perfected the moment the minds meet, and the deed is only evidence of a consent that already existed. So a notarised deed signed a week later does not move the date of perfection — and an unwritten sale of a car is already binding, even though the Statute of Frauds would make a sale of land unenforceable without writing.
Flashcard review
The terms and articles you need before the quiz. Tap a card to flip it. Cover the answer and say the definition out loud first — that is what makes it stick.
Practice quiz
Eighteen items across the whole module, written the way bar and board questions are written — the facts matter more than the labels. You get an explanation after every answer; read it even when you get it right.
The questions shuffle
Every attempt reorders the items, so you cannot memorise the sequence — only the rules.
Answer with the article
Before you tap, finish this sentence out loud: "This is Article ___, and it says ___." If you cannot, you are recognising, not knowing.
Aim for 15 / 18
Below that, go back to the case drills and the cheat sheet, then try again.
Cheat sheet
Every rule this module turns on, in one table. If you can read down this list and say what each one does, you are ready.
| Topic | The rule | Remember |
|---|
Say which one, every time
Valid — it stands. Rescissible — valid but damaging, and undoable. Voidable — a defect in consent or capacity; valid until annulled and ratifiable. Unenforceable — valid but no action lies until it is cured. Void — it never existed, produces no effect, cannot be ratified, and the action to declare it does not prescribe. An answer that stops at "the sale is not valid" has not answered the question.
Dates decide cases
6 months from delivery — hidden defects (40 days for animals).
30 days from written notice — legal redemption.
4 years, or the agreed period up to 10 — conventional redemption.
1 year from the assignment, or from maturity — the assignor's warranty of
solvency.
Before you close this
On exam day, write these four lines at the top of your scratch paper before you read a single item: ownership passes by delivery · 1544: register → possess → oldest title, all in good faith · 1599 remedies are alternative · Recto = personal, Maceda = real. Most of the items fall out of those four lines.