1
QUESTIONS1 AND ANSWERS2
IN
S ALES AG EN C Y AN D
C REDI T TR AN S AC TIO NS
( F or Bu s in ess Law Stud en t s )
B Y:
AT T Y. C H R I S T O P H E R R . H E R N A N D E Z
Instructor of Business Law
Polytechnic University of the Philippines/
Pamantasan ng Cabuyao
Copyright 2013
A t t y. C h r i s t o p h e r R . H e r n a n d e z
(Strictly for the eyes of the Students of Atty. Christopher R. Hernandez only OR upon his
approval. Thus, bearer is hereby enjoined from distributing this notes without the consent
of Atty. Hernandez)
1
Questions came from the Book of Atty. Fidelito Soriano on Sales Agency and Credit Transactions.
2
Initial Answers were prepared by the following students of the undersigned namely: Paolo Miguel
Villaceran, Roby Cundangan, Cecille Pajenago, Mark Hatulan, and PUPSRC BSA 3-1 -2012-2013
, 2
LAW ON SALES
1. A contract whereby one of the contracting parties obligates himself to transfer the
ownership of and to deliver a determinate thing and the other to pay therefore a
price certain in money or its equivalent is a contract of:
a. barter
b. sale
c. dacion en pago
d. mortgage
Answer: B. sale
It is expressly stated in Article 1458 of the Civil Code that by the contract of sale one
of the contracting party obligates himself to transfer the ownership of to deliver a
determinate thing, and other to pay therefor a price certain in money or its
equivalent.
2. The following are the essential elements of a contract of sale, except:
a. consent of the contracting parties
b. subject matter which should be determinate
c. price which is certain money or its equivalent
d. warranty against eviction and against hidden defects
Answer: D. warranty against eviction and against hidden defects
Also, it is expressly stated in the article 1458 of the Civil Code of the Philippines
wherein the three are to be found within the first paragraph. Warranty against
eviction and hidden defects is not an essential element of a Contract of Sale but
merely a natural elements of a contract of sale.
3. The following are the characteristics of a contract of sale, except:
a. principal, which means a contract of sale can stand by itself
b. real, which requires the delivery of the object of the contract of sale for its
perfection
c. onerous, where rights are acquired in exchange of a valuable consideration
d. bilateral, which means that both parties are bound reciprocally to each other
Answer: B. real, which requires the delivery of the object of the contract of
sale for its perfection
It is because a contract of sale can be perfected even though without the delivery of
the object. It is a CONSENSUAL CONTRACT.
4. One of the following characteristics of dacion en pago is also a characteristic of a
contract of sale. Which is it?
a. There is a pre-existing credit.
b. Obligations are extinguished.
c. There is less freedom in fixing price.
d. Ownership of the object is transferred to the other party.
Answer: D. Ownership of the object is transferred to the other party
It is because dacion en pago is also known as dation of payment wherein the
, 3
And from there we can conclude that there is also a transfer of ownership in dacion
en pago.
5. The following are characteristics of a contract of sale except for one which refers to
payment by cession. Which characteristic refers to payment by cession?
a. There is no pre-existing credit.
b. The cause or consideration is the price.
c. There is more freedom in fixing the price.
d. Assignee of the property acquires the right to sell the thing but not the owner
thereof.
Answer: D. Assignee of the property acquires the right to sell the thing but not
the owner thereof.
In payment of cession, the creditors do not become the owners of the property
assigned to them but are merely given the right to sell such property and apply the
proceeds to their claims.
6. The following items pertain to either a contract of sale or contract to sell.
I. Ownership of the thing sold is transferred upon delivery.
II. Ownership of the thing is transferred to the buyer at some future time.
III. The risk of loss is on the buyer.
IV. The risk of loss in on the seller.
Based on the above data, which of the following is correct?
a. Items I and III pertain to a contract to sell.
b. Items II and III pertain to a contract to sell.
c. Items II and IV pertain to a contract of sale.
d. Items I and III pertain to a contract of sale.
Answer: D. Items I and III pertain to a contract of sale.
It is due to the reason that generally speaking the seller bears the loss and the
ownership of the object of the contract transfers upon delivery.
Statement I pertains to a contract of sale because it is stated in Article 1477 that
ownership of thing sold is transferred upon the actual or constructive delivery
thereof.
7. One of the following is not a requisite of the object of a contract of sale. Which is it?
a. It must be within the commerce of men.
b. It must be licit.
c. It must be determinate or determinable.
d. Vendor must have the right to transfer the ownership of the thing at the time of
sale.
Answer: D. Vendor must have the right to transfer the ownership of the thing
at the time of sale.
Because it is not mentioned within the articles concerning the object of a contract of
sale which are articles 1459 – 1465. Even if the Vendor is not the owner of the
propertyat the time of the perfection, the sale is still valid as long as he is the owner
at the time of the delivery.
8. The following items pertain to either emptioreisperati or emptiospei.
, 4
II. The sale of hope or expectancy.
III. The sale of a present thing.
IV. The thing sold must come into existence
Based on the above information, which of the following is correct?
a. Items I and II pertain to emptioreisperati.
b. Items II and III pertain to emptiospei.
c. Items II and III pertain to emptioreisperati.
d. Items III and IV pertain to emptiospei.
Answer: B. Items II and III pertain to emptiospei.
Emptiospei is a sale of present thing, or the hope itself or expectancy.
9. Santiago sells Bermejo 500 sacks of rice at P1,000 per sack from the stock then
stored in the warehouse of Santiago. Unknown to the parties, the warehouse
contains only 480 sacks of rice. What is the status of the contract between Santiago
and Bermejo?
a. The sale is void since the quantity available is less than the quantity sold.
b. The sale is valid up to 480 sacks of rice but void as to the deficiency of 20 sacks
of rice.
c. The entire sale is valid up to 500 sacks of rice. Bermejo becomes the owner of
the whole stock available and Santiago must deliver the deficiency of 20 sacks of
rice.
d. The sale is valid up to 480 sacks of rice but rescissible as to the deficiency of 20
sacks of rice by reason of damage suffered by Bermejo.
Answer: C. The entire sale is valid up to 500 sacks of rice. Bermejo becomes
the owner of the whole stock available and Santiago must deliver the
deficiency of 20 sacks of rice.
It is expressly stated in Article 1464 of the Civil Code of the Philippines. In a sale
wherein the seller delivers insufficient amount than contracted, the buyer may either
reject or accept the sale up to the amount available upon delivery. If accepted, the
seller is bound to deliver the deficiency of same kind and quality.
10. Somera sells to Buenviaje at P50 per gallon 300 gallons of gasoline stored in his
truck’s tank which unknown to the parties, contains 500 gallons gasoline. What is the
status of the contract of sale between Somera and Buenviaje?
a. The sale is void because the quantity available is more than the quantity sold.
b. The sale is valid up to 500 gallons of gasoline. Buenviaje must pay for the
additional 200 gallons of gasoline.
c. The sale is valid up to 300 gallons of gasoline. Buenviaje becomes the owner of
3/5 of the whole stock, while Somera becomes the owner of 2/5 of the whole stock.
d. The sale is rescissible because Somera will suffer lesion of more than ¼ of the
value of the whole stock.
Answer: C. The sale is valid up to 300 gallons of gasoline. Buenviaje becomes
the owner of 3/5 of the whole stock, while Somera becomes the owner of 2/5 of
the whole stock.
It is discussed in Article 1464 that there may be sale of undivided share of fungible
goods even though the seller sold, or the buyer bought, a definite number weight or
measure. In the said case, the buyer becomes a co-owner of the such as share in
the mass. As such, Buenviaje becomes the co-owner of 3/5 of the stocks which is
QUESTIONS1 AND ANSWERS2
IN
S ALES AG EN C Y AN D
C REDI T TR AN S AC TIO NS
( F or Bu s in ess Law Stud en t s )
B Y:
AT T Y. C H R I S T O P H E R R . H E R N A N D E Z
Instructor of Business Law
Polytechnic University of the Philippines/
Pamantasan ng Cabuyao
Copyright 2013
A t t y. C h r i s t o p h e r R . H e r n a n d e z
(Strictly for the eyes of the Students of Atty. Christopher R. Hernandez only OR upon his
approval. Thus, bearer is hereby enjoined from distributing this notes without the consent
of Atty. Hernandez)
1
Questions came from the Book of Atty. Fidelito Soriano on Sales Agency and Credit Transactions.
2
Initial Answers were prepared by the following students of the undersigned namely: Paolo Miguel
Villaceran, Roby Cundangan, Cecille Pajenago, Mark Hatulan, and PUPSRC BSA 3-1 -2012-2013
, 2
LAW ON SALES
1. A contract whereby one of the contracting parties obligates himself to transfer the
ownership of and to deliver a determinate thing and the other to pay therefore a
price certain in money or its equivalent is a contract of:
a. barter
b. sale
c. dacion en pago
d. mortgage
Answer: B. sale
It is expressly stated in Article 1458 of the Civil Code that by the contract of sale one
of the contracting party obligates himself to transfer the ownership of to deliver a
determinate thing, and other to pay therefor a price certain in money or its
equivalent.
2. The following are the essential elements of a contract of sale, except:
a. consent of the contracting parties
b. subject matter which should be determinate
c. price which is certain money or its equivalent
d. warranty against eviction and against hidden defects
Answer: D. warranty against eviction and against hidden defects
Also, it is expressly stated in the article 1458 of the Civil Code of the Philippines
wherein the three are to be found within the first paragraph. Warranty against
eviction and hidden defects is not an essential element of a Contract of Sale but
merely a natural elements of a contract of sale.
3. The following are the characteristics of a contract of sale, except:
a. principal, which means a contract of sale can stand by itself
b. real, which requires the delivery of the object of the contract of sale for its
perfection
c. onerous, where rights are acquired in exchange of a valuable consideration
d. bilateral, which means that both parties are bound reciprocally to each other
Answer: B. real, which requires the delivery of the object of the contract of
sale for its perfection
It is because a contract of sale can be perfected even though without the delivery of
the object. It is a CONSENSUAL CONTRACT.
4. One of the following characteristics of dacion en pago is also a characteristic of a
contract of sale. Which is it?
a. There is a pre-existing credit.
b. Obligations are extinguished.
c. There is less freedom in fixing price.
d. Ownership of the object is transferred to the other party.
Answer: D. Ownership of the object is transferred to the other party
It is because dacion en pago is also known as dation of payment wherein the
, 3
And from there we can conclude that there is also a transfer of ownership in dacion
en pago.
5. The following are characteristics of a contract of sale except for one which refers to
payment by cession. Which characteristic refers to payment by cession?
a. There is no pre-existing credit.
b. The cause or consideration is the price.
c. There is more freedom in fixing the price.
d. Assignee of the property acquires the right to sell the thing but not the owner
thereof.
Answer: D. Assignee of the property acquires the right to sell the thing but not
the owner thereof.
In payment of cession, the creditors do not become the owners of the property
assigned to them but are merely given the right to sell such property and apply the
proceeds to their claims.
6. The following items pertain to either a contract of sale or contract to sell.
I. Ownership of the thing sold is transferred upon delivery.
II. Ownership of the thing is transferred to the buyer at some future time.
III. The risk of loss is on the buyer.
IV. The risk of loss in on the seller.
Based on the above data, which of the following is correct?
a. Items I and III pertain to a contract to sell.
b. Items II and III pertain to a contract to sell.
c. Items II and IV pertain to a contract of sale.
d. Items I and III pertain to a contract of sale.
Answer: D. Items I and III pertain to a contract of sale.
It is due to the reason that generally speaking the seller bears the loss and the
ownership of the object of the contract transfers upon delivery.
Statement I pertains to a contract of sale because it is stated in Article 1477 that
ownership of thing sold is transferred upon the actual or constructive delivery
thereof.
7. One of the following is not a requisite of the object of a contract of sale. Which is it?
a. It must be within the commerce of men.
b. It must be licit.
c. It must be determinate or determinable.
d. Vendor must have the right to transfer the ownership of the thing at the time of
sale.
Answer: D. Vendor must have the right to transfer the ownership of the thing
at the time of sale.
Because it is not mentioned within the articles concerning the object of a contract of
sale which are articles 1459 – 1465. Even if the Vendor is not the owner of the
propertyat the time of the perfection, the sale is still valid as long as he is the owner
at the time of the delivery.
8. The following items pertain to either emptioreisperati or emptiospei.
, 4
II. The sale of hope or expectancy.
III. The sale of a present thing.
IV. The thing sold must come into existence
Based on the above information, which of the following is correct?
a. Items I and II pertain to emptioreisperati.
b. Items II and III pertain to emptiospei.
c. Items II and III pertain to emptioreisperati.
d. Items III and IV pertain to emptiospei.
Answer: B. Items II and III pertain to emptiospei.
Emptiospei is a sale of present thing, or the hope itself or expectancy.
9. Santiago sells Bermejo 500 sacks of rice at P1,000 per sack from the stock then
stored in the warehouse of Santiago. Unknown to the parties, the warehouse
contains only 480 sacks of rice. What is the status of the contract between Santiago
and Bermejo?
a. The sale is void since the quantity available is less than the quantity sold.
b. The sale is valid up to 480 sacks of rice but void as to the deficiency of 20 sacks
of rice.
c. The entire sale is valid up to 500 sacks of rice. Bermejo becomes the owner of
the whole stock available and Santiago must deliver the deficiency of 20 sacks of
rice.
d. The sale is valid up to 480 sacks of rice but rescissible as to the deficiency of 20
sacks of rice by reason of damage suffered by Bermejo.
Answer: C. The entire sale is valid up to 500 sacks of rice. Bermejo becomes
the owner of the whole stock available and Santiago must deliver the
deficiency of 20 sacks of rice.
It is expressly stated in Article 1464 of the Civil Code of the Philippines. In a sale
wherein the seller delivers insufficient amount than contracted, the buyer may either
reject or accept the sale up to the amount available upon delivery. If accepted, the
seller is bound to deliver the deficiency of same kind and quality.
10. Somera sells to Buenviaje at P50 per gallon 300 gallons of gasoline stored in his
truck’s tank which unknown to the parties, contains 500 gallons gasoline. What is the
status of the contract of sale between Somera and Buenviaje?
a. The sale is void because the quantity available is more than the quantity sold.
b. The sale is valid up to 500 gallons of gasoline. Buenviaje must pay for the
additional 200 gallons of gasoline.
c. The sale is valid up to 300 gallons of gasoline. Buenviaje becomes the owner of
3/5 of the whole stock, while Somera becomes the owner of 2/5 of the whole stock.
d. The sale is rescissible because Somera will suffer lesion of more than ¼ of the
value of the whole stock.
Answer: C. The sale is valid up to 300 gallons of gasoline. Buenviaje becomes
the owner of 3/5 of the whole stock, while Somera becomes the owner of 2/5 of
the whole stock.
It is discussed in Article 1464 that there may be sale of undivided share of fungible
goods even though the seller sold, or the buyer bought, a definite number weight or
measure. In the said case, the buyer becomes a co-owner of the such as share in
the mass. As such, Buenviaje becomes the co-owner of 3/5 of the stocks which is
