Buslaw 1

De La Salle University
Comlaw Department
Obligations and Contracts
Book IV, New Civil Code
Title 2, Chapter 1
Contracts: General Provisions
CHAPTER 1. – General Provisions
ARTICLE 1305. A contract is a meeting of minds between two persons whereby
one binds himself, with respect to the other, to give something or to render
services.

Definition of a Contract

ARTICLE 1306. The contracting parties may establish such stipulations, clauses,
terms and conditions as they may deem convenient, provided they are not contrary
to law, morals, good customs, public order or public policy.

Stipulations, clauses, terms, and condition must NOT be contrary to:

Law
Morals – ex. condition such as sleeping with the wife of another is prohibited
Good Customs – cheating is not allowed
Public Order – you can’t burn a flag
CHAPTER 1. – General Provisions
ARTICLE 1307. Innominate contracts shall be regulated by the stipulation of
the parties, by the provisions of Titles I and II of this Book, by the rules
governing the analogous nominate contracts, and by the customs of the place.

Custom of the place may be very substantial and in interpreting/understanding the

contracts that have not been specifically provided for by law, reliance on people’s
understanding of the contract is essential.

Sometimes, even the designation of the contract may take the form of colloquial term in
the area where the contract was entered into.

EBON vs ITLOG
Giprenda or Lote means pawning or mortgaging in some places in Visaya
CHAPTER 1. – General Provisions
If the Contract has no name in law, they are referred to as Innominate Contracts.

Kinds of Innominate Contracts

Do ut Des or “I give and You give”
Do ut Facias or “I give and You do”
Facio ut Des or “I do and You give”
Facio ut Facias or “I do and You Do”

ARTICLE 1308. The contract must bind both the contracting parties, its
validity or compliance cannot be left to the will of one of them.

Contracts are always involve both parties in a contract

“Meeting of the Minds”
CHAPTER 1. – General Provisions
ARTICLE 1309. The determination of the performance may left to a third
person, whose decision shall not be binding until it has been made known to
both contracting parties.

ARTICLE 1310. The determination shall not be obligatory if it is evidently

inequitable. In such cases, the court shall decide what is equitable under the
circumstances.

It is possible for the parties to agree to a third party to determine if the parties have
complied with their respective obligations.

Think of the situation where a contestant in a beauty contest agrees to compete and the
organizers agree to give the winner a prize but the determination on who complied and
who must be given the prize belongs to the independent judges. Until the winner is
announced, there is no winner yet and if the winner turns out to be not meant to win
then there can be a lawsuit to nullify the judgement.
CHAPTER 1. – General Provisions
ARTICLE 1311. Contracts take effects only between the parties, their assigns
and heirs, except in case when the rights and obligations arising from the
contract are not transmissible in their nature, or by stipulation or by
provision of law. The heir is not liable beyond the value of the property he
received from the decedent.

If a contract should contain some stipulation in favor of a third person, he

may demand its fulfillment provided he communicated his acceptance to the
obligor before its revocation. A mere incidental benefit or interest of a
person is not sufficient. He contracting parties must have clearly and
deliberately offered a favor upon a third person.
CHAPTER 1. – General Provisions
1st Paragraph

Owes P50,000
Philip Joseph

Cat Philip Jr. Dana Joseph Jr.

Agent Heir Agent Heir

Unless the rights and obligations are not transmissible by the

nature of the obligation, by stipulation or by law
CHAPTER 1. – General Provisions
2nd Paragraph

Lucio Tan Trust Fund

God Child

God Child must accept the trust fund before it is revoked in

order to make the contract valid. These stipulations are
generally referred to as Stipulations Pour Autrui
CHAPTER 1. – General Provisions
ARTICLE 1312. In contracts creating real rights, third persons who come into
possession of the object of the contract are bound thereby, subject to the
provision of the Mortgage Law and Land Registration laws.

Personal Rights – right to demand the thing promised but this right does not bind the
rest of the world, only the parties.
Real Rights – right to enjoy the thing promised and is enforceable against everyone
else, not just the parties.

ARTICLE 1313. Creditors are protected in case of contracts intended to

defraud them.

Creditors are allowed to impugn contracts entered into by a debtor in order to avoid
paying the creditor or deny the creditor compensation.
CHAPTER 1. – General Provisions
ARTICLE 1314. Any third person who induces another to violate his contract
shall be liable for damages to the other contracting party.

In this instance, even if a party is not one of the contracting parties, they may be made
liable for damages on the same if they induced the debtor to violate the contract.

ARTICLE 1315. Contracts are perfected by mere consent, and from that
moment the parties are bound not only to the fulfillment of what has been
expressly stipulated but also to all the consequences which, according to their
nature, may be in keeping with good faith, usage and law.

Very important concept. A contract is not the written agreement of the parties but it is
the meeting of the minds of the parties. The written agreement is only the evidence of
the meeting of the minds.
CHAPTER 1. – General Provisions
ARTICLE 1316. Real contracts, such as deposits, pledge and commodatum,
are not perfected until the delivery of the object of the obligation.

Real Contracts are contracts that create real obligations, or obligations to give.

ARTICLE 1317. No one may contract in the name of another without being
authorized by the latter, or unless he has by law a right to represent him.

A contract entered into in the name of another by one who has no

authority or legal representation, or who has acted beyond his power, shall
be unenforceable, unless it is ratified, expressly or impliedly, by the person
on whose behalf it has been executed, before it is revoked by the other
contracting party.
Obligations and Contracts
Book IV, New Civil Code
Title 2, Chapter 2
Essential Requisites of a Contract
CHAPTER 2. – Essential Requisites of a Contract
General Provisions
ARTICLE 1318. There is no contract unless the following requisites concur:

(1) Consent of the contracting parties;

(2) Object certain which is the subject matter of the contract;
(3) Cause of the obligation which is established.
If any one of the items is missing, there is no contract.
If any one of the items is impaired, then the contract is defective
This article is also the most important article in the entire title because this is the
basis of the other articles in the title.
SECTION 1. – Consent
ARTICLE 1319. Consent is manifested by the meeting of the offer and the
acceptance upon the thing and the cause which are to constitute the contract.
The offer must be certain and the acceptance absolute. A qualified
acceptance constitute a counter-offer.

Acceptance made by letter or telegram does not bind the offered except
from the time it came to his knowledge. The contract, in such a case, is
presumed to have been entered into in the place where the offer was made.
Acceptance is the expression of the offeree of his assent to the terms of the offer. Without
acceptance, there can be no meeting of the minds between the parties.

Until the acceptance is communicated to the offeror, it shall produce no effect. There is no
particular form needed to communicate acceptance of the offer.
SECTION 1. – Consent
ARTICLE 1320. An acceptance may be express or implied.

ARTICLE 1321. The person making the offer may fix the time, place, and
manner of acceptance, all of which must be complied with.

The manner of acceptance may be dictated by the person making the offer, not the person
accepting the offer.
SECTION 1. – Consent
ARTICLE 1322. An offer made through an agent is accepted from the time
acceptance is communicated to him.

An offer made through an agent may be also accepted through the same agent.

ARTICLE 1323. An offer becomes ineffective upon the death, civil

interdiction, insanity, or insolvency of either party before acceptance is
conveyed.

Civil Interdiction – the instance when the court removes from an individual his civil
rights for justifiable reasons.

The rationale for this is that an offer is good so long as the person making the offer is
still capable of receiving the acceptance of the offer.
SECTION 1. – Consent
ARTICLE 1324. When the offerer has allowed the offeree a certain period to
accept, the offer may be withdrawn at any time before acceptance by
communicating such withdrawal, except when the option is founded upon a
consideration, as something paid or promised. (n)

The general rule is that an offer can be withdrawn at any time prior to acceptance of the
same. The exception to this rule is when the offer was made with a separate option
contract.
Option Contract – a contract for the span of time (Option Period) within which an
offer shall remain in force and cannot be withdrawn by the offerer. This contract
must be separately covered by a consideration (Option Money) for the option period.
Earnest Money – Option Money must not be confused with earnest money as the
former is in payment of the period to accept an offer and the latter is actually a down
payment for the contract.
SECTION 1. – Consent
ARTICLE 1325. Unless it appears otherwise, business advertisement of
things for sale are not definite offers, but mere invitations to make an offer.

“As Seen on TV” not an offer to sell. 

ART. 1326. Advertisements for bidders are simply invitations to make

proposals, and the advertiser is not bound to accept the highest or lowest
bidder, unless the contrary appears. (n)

Asking for bidders is normally a request for people to make an offer and not an offer by
itself. Similarly, there is no obligation on the part of the person asking for bidders to
accept the highest or lowest offer because ultimately, the person who will accept the offer
is the one asking for the offer.
SECTION 1. – Consent
ARTICLE 1327. The following cannot give consent to a contract:
(1) Unemancipated minors;
(2) Insane or demented persons, and deaf-mutes who do not know how to
write.
Unemancipated Minors – Minors under parental authority.
Insane Persons vs Demented Persons
Deaf-mutes who cannot read or write
SECTION 1. – Consent
ARTICLE 1328. Contracts entered into during a lucid interval are valid.
Contracts agreed to in a state of drunkenness or during a hypnotic spell are
voidable.

“Don Quixote Story” and “Usapang Lasing”

ARTICLE 1329. The incapacity declared in article 1327 is subject to the

modification determined by law and is understood to be without prejudice to
special disqualifications established in the laws.

Foresight of the Lawmakers during that era understood that laws may be modified to
become more lenient or stricter and made this article precisely to take that into
consideration.
SECTION 1. – Consent
ARTICLE 1330. A contract where consent is given through mistake, violence,
intimidation, undue influence or fraud is voidable.

Mistake – serious error that goes into the essence of the contract
Violence – actual use of superior force to overcome resistance
Intimidation – use of threat to break down resistance
Undue Influence – use of incorrect or improper persuation to convince
Fraud – use of machinations and words to deceive

Using these methods makes the consent secured defective

SECTION 1. – Consent
ARTICLE 1331. In order that mistake may invalidate consent, it should refer
to the substance of the thing which is the object of the contract, or to those
condition which have principally moved one or more parties to enter into
contract.

Mistake as to the identity or qualifications of one of the parties will vitiate

consent only when such identity or qualifications have been the principal
cause of the contract.

A simple mistake of account shall give rise to its correction.

Conditions that must be present for mistake to make the consent defective.
SECTION 1. – Consent
ARTICLE 1332. When one of the parties is unable to read, or if the contract is
in a language not understood by him, and mistake or fraud is alleged, the
person enforcing the contract must show that the terms thereof have been
fully explained to the former.

This article protects illiterate people or those who speak in a single language not used in
the contract from people who wish to take advantage of them.

ARTICLE 1333. There is no mistake if the party alleging it knew the doubt,
contingency or risk affecting the object of the contract.
SECTION 1. – Consent
ARTICLE 1334. Mutual error as to the legal effect of the agreement when the
real purpose of the parties is frustrated may vitiate consent.

This article takes into consideration where both parties were mistaken in what contract
they were entering in the first place. Thus, no meeting of minds could occur.
Offered to sell a cow

John James

Agreed to buy a horse

SECTION 1. – Consent
ARTICLE 1335. There is violence when in order to wrest consent, serious or
irresistible force is employed.

There is intimidation when one of the contracting parties is compelled by

a reasonable and well-grounded fear of an imminent and grave evil upon his
person or property, or upon the person or property of his spouse, descendents
or ascendants, to give his consent.

To determine the degree of the intimidation, the age, sex and condition of
the person shall be borne in mind.

A threat to enforce one’s claim through competent authority, if the claim

is just or legal, does not vitiate consent.

Conditions that must be present for violence and intimidation to make the consent
defective.
SECTION 1. – Consent
For Violence to vitiate (or impair) consent the force or violence must be either serious
or irresistible to such an extent where the determining cause or reason for giving the
consent was the force or violence employed.
For Intimidation to vitiate consent, the following requisites must be present
1. It must produce a reasonable and well grounded fear
2. The evil must be grave and imminent
3. The evil must be upon his person or property or that of his spouse, decendants or
accendants
4. It was the reason why the person entered into the contract
Intimidation can also be affected by the age, sex and condition of the persons
involved.
The threat to exercise a valid and legal right by a party does not constitute as
Intimidation that will vitiate consent.
SECTION 1. – Consent
ARTICLE 1336. Violence or intimidation shall annul the obligation, although it
may have been employed by a third person who did not take part in the contract.

ARTICLE 1337. There is undue influence when a person takes improper

advantage of his power over the will of another, depriving the latter of a
reasonable freedom of choice. The following circumstances shall be considered:
the confidential, family, spiritual and other relations between the parties, or the
fact that the person alleged to have been unduly influenced was suffering from
mental weakness, or was ignorant or in financial distress.
SECTION 1. – Consent
Circumstances to be considered in Undue Influence
1. Confidential, familial, spiritual and other relations between the parties
2. Mental Weakness of the party
3. Ignorance; or
4. Financial distress of the person being unduly influenced.

When is influence considered undue?

Mere influence over a person does not necessarily make it undue. When the influence on the
person was made respecting the free will of the person, then this is called due influence.
However, when the person exerting the influence was made to dominate the will or constrain
the person from exercising the free will of the person being influenced, then it becomes undue
influence.
SECTION 1. – Consent
ARTICLE 1338. There is fraud when, through insidious words or
machinations of one of the contracting parties, the other is induced to enter
into a contract, which without them, he would not have agreed to.

This article describes what causal fraud is, not to confuse it with incidental fraud

ARTICLE 1339. Failure to disclose facts, when there is duty to reveal them, as
when confidential relations bind the parties, constitute fraud.

Withholding information from a person you want to enter into a contract with because
you know they will not enter into the contract if you disclose the information is fraud.

ARTICLE 1340. The usual exaggeration in trade, when the other party had an
opportunity to know the facts, are not in themselves fraudulent.

Marketing spiel does not constitute fraud.

SECTION 1. – Consent
ARTICLE 1341. A mere expression of an opinion does not signify fraud,
unless made by an expert and the other party has relied on the formers
special knowledge.

Distinction between ordinary opinion and expert opinion. Even if the opinion was
rendered by an expert, if the person claiming fraud did not rely on it, there’s no fraud.

ARTICLE 1342. Misrepresentation by a third person does not vitiate consent,

unless such misrepresentation has created substantial mistake and the same
is mutual. .
Same principle as Art. 1341

ARTICLE 1343. Misrepresentation made in good faith is not fraudulent but

may constitute error.
SECTION 1. – Consent
ARTICLE 1344. In order that fraud may make contract voidable it should be
serious and should not have been employed by both contracting parties.

Incidental fraud only obliges the person employing it to pay damages.

This article distinguishes between Causal Fraud and Incidental Fraud

ARTICLE 1345. Simulation of a contract may be absolute or relative. The

former takes place when the parties do not intend to be bound at all; the
latter, when the parties conceal their true agreement.

Simulated contracts are “contracts” that appear to exist when in fact it does not or it
hides the real contract between the parties.
SECTION 1. – Consent
ARTICLE 1346. An absolute simulated or fictitious contract is void. A
relative simulation, when it does not prejudice a third person and is not
intended for any purpose contrary to law, morals, good customs, public order
or public policy binds the parties to their real agreement.

Absolutely Simulated Contract = No Contract

Relative Simulated Contract may remain valid but the original agreement shall be the
one binding.

In all contracts, simulated or not, the principle of it being in consonance with law,
morals, good customs, public order and public policy shall prevail
Obligations and Contracts
Book IV, New Civil Code
Title 2, Chapter 2[S2]
Object
SECTION 2. – Object
ARTICLE 1347. All things which are not outside the commerce of men,
including future things, may be the object of a contract. All rights which are
not intransmissible may also be the object of contracts.

No contract may be entered into upon future inheritance except in cases

authorized by law.

All services which are not contrary to law, morals, good customs, public order
or public policy may likewise be the object of a contract.

ARTICLE 1348. Impossible things or services cannot be the object of

contracts.

These two articles reiterates the discussions on what objects may be constituted in a
contract/obligation.
SECTION 2. – Object
ARTICLE 1349. The object of every contract must be determinate as to its
kind. The fact that the quantity is not determinate shall not be an obstacle to
the existence of the contract, provided that it is possible to determine the
same, without the need of a new contract between the parties.
Objects need to be determinate as to its kind otherwise the parties will not know what
to give.
 “I promise to give you something” is not a valid object

Quantity of the object need not be actually determined in the contract if it can be
reasonably be determined without the need of a new contract.
Obligations and Contracts
Book IV, New Civil Code
Title 2, Chapter 2[S3]
Cause
SECTION 3. – Cause
ARTICLE 1350. In onerous contracts the cause is understood to be, for each
contracting party, the prestation or promise of a thing or service by the other;
in remuneratory ones, the service or benefit which is remunerated; and in
contracts of pure beneficence, the mere liberality of the benefactor.
Cause of the Contract is often also referred to as the Consideration of the Contract.
Cause or Consideration of the Contract is what pushed the party into entering into
the contract with the other party. The Cause may be different for each of the party in
the contract but so long as the cause is sufficient to support a contract, then it is a
valid consideration.

ARTICLE 1351. The particular motives of the parties in entering into a

contract are different from the cause thereof.

Do not confuse Cause with Motive. Motive will not support a contract.
SECTION 3. – Cause
ARTICLE 1352. Contracts without cause, or with unlawful cause, produce no
effect whatever. The cause is unlawful if it is contrary to law, morals, good
customs, public order or public policy.

Again, the consideration like every element of a contract, but comply with the principles
of law, morals, good customs, public order and public policy.

If it does not, then the consideration produces no effect whatsoever.

ARTICLE 1353. The statement of a false cause in contracts shall render them
void, if it should not be proved that they were founded upon another cause
which is true and lawful.

False (non-existent) Cause = Absolutely Simulated Contract

False (not the real) Cause = Relative Simulated Contract
SECTION 3. – Cause
ARTICLE 1354. Although the cause is not stated in the contract, it is
presumed that it exist and is lawful, unless the debtor proves the contrary.

There is a presumption that all contracts have a lawful cause or consideration and that
it does not have to be mentioned in the contract.

However, the presumption is disputable and the debtor may prove otherwise.

ARTICLE 1355. Except in cases specified by law, lesion or inadequacy of

cause shall not invalidate a contract, unless there has been fraud, mistake or
undue influence.

Insufficiency or impairment of the cause or consideration is not normally considered in

a contract unless it gives rise to or prove fraud, mistake or undue influence which
would impair the consent of the party, hence making the contract voidable.
Buslaw 1
Study Guide
MODIFIED TRUE OR FALSE
1. The creation of contracts requires at least 2 people to be valid.
2. In contracts, the parties can agree on anything and everything under the
sun.
3. All contract are required to be named and identified to determine which
rules will apply to the specific contract.
4. The parties can agree on how the determination of the performance of the
contract provided it is not determined by either of them.
5. Contracts are personal agreements that binds only the parties in the contract
and does not extend to other people.
6. Contract that are valid but which defrauds other creditors may be
questioned by the other creditors..
7. Contracts does not have to be in writing to be valid.
MODIFIED TRUE OR FALSE
8. Persons who convinces a party not to comply with their obligations in a
contract are as liable as the party who breaks their obligations.
9. Real contracts are contracts which actually exist.
10. A person cannot enter into a contract in the name of another person unless
he or she is authorized to do so.
11. Consent is exhibited when an offer made by a party is accepted by another.
12. A contract cannot be created from an offer which is uncertain.
13. A qualified acceptance of an offer is nothing more than another offer made
by the other party.
14. A person who offers something to another, the other party will determine
how, when and where the offer will be accepted in order for a contract to be
created.
MODIFIED TRUE OR FALSE
15. An offer accepted by a person seconds before the offeror dies creates a valid
contract.
16. Option contracts are contracts separate and distinct from the contract the
parties want to create.
17. Earnest money is a partial payment on a perfected contract.
18. Offers made via TV home shopping programs are perfected upon
acceptance by the buyers.
19. Minors who are emancipated still cannot give consent to a contract.
20. Insane or demented persons can never give their consent to create a contract
21. As a general rule, mistakes in the identity of one of the parties to a contract
vitiates the consent of the party who was mistaken.
MODIFIED TRUE OR FALSE
22. In case an illiterate person claims fraud, the fraud must be still be proven by
the person who claims there was fraud.
23. An offer made on an “as-in, where-is” basis can vitiate consent if the item
has a defect after it is purchased.
24. Mutual error that resulted in the failure of the parties to understand what it
was they were entering into may vitiate consent.
25. Shooting in the air and then pointing the gun on a person to sign a contract
is an example of violence that vitiates consent.
26. A threat to infect a person with asthma if they do not sign a contract is a
case of intimidation.
27. A 5 foot tall girl cannot intimidate a 7 foot varsity player into entering into a
contract.
28. A threat to sue if a party fails to enter into a contract is intimidation.
MODIFIED TRUE OR FALSE
29. Violence employed by a third party to force a person to enter into a contract
with another still vitiates the consent in that contract.
30. Influencing a person into entering into a contract is undue influence.
31. Fraud that was perpetrated to induce a party to enter into a contract is
causal fraud.
32. Fraud that is not part of a contract is not causal but only incidental.
33. Failure to disclose facts in the creation of a contract constitutes as fraud and
will vitiate consent.
34. Exaggeration made by a salesman constitutes as fraud that can vitiate
consent.
35. Third parties who misinterpreted the terms of the contract that the parties
had entered into vitiates the consent of the parties to that contract.
MODIFIED TRUE OR FALSE
36. Testimonials of successes by customers are not incidents of fraud that can
vitiate consent.
37. Incidental fraud cannot vitiate consent, it can only entitles the innocent
party to damages.
38. Simulated contracts are contracts that are fake and do not exist.
39. Relative simulation of contracts do not bind parties to the apparent contract
they had apparently entered into.
40. Relatively simulated contracts entered into contrary to law, morals, good
customs, public order or policy are void and will bind the parties to what
they originally intend to be bound with.
41. Objects of contracts must be physically existing to be valid.
42. Rights may be a valid object to a contract.
MODIFIED TRUE OR FALSE
43. All kinds of service may be a valid object to a contract.
44. Unlike obligations, objects in contracts must be determinate or specific and
generic objects cannot qualify.
45. Cause and consideration are synonymous.
46. In reciprocal obligation, consideration is what a person receives and not the
object they parted away with.
47. In donations, the object of the contract is the generosity of the giver.
48. Motives and consideration are often the same.
49. False cause invalidates contracts.
50. Purchases made at unbelievably low prices invalidates the consideration of
a contract and hence the contract itself,
ENUMERATIONS/DEFINITIONS
1. Define contracts?
2. What are the kinds of stipulations parties cannot enter into?
3. What are the innominate contracts?
4. Who are the people bound by the terms of the contracts?
5. What are real and personal contracts?
6. What are real and personal rights?
7. What are the essential elements of a contract?
8. When is consent manifested in a contract.
9. Apart from withdrawal of the offer, when does an offer become ineffective?
10. What are option contracts?
ENUMERATIONS/DEFINITIONS
11. What is option money?
12. What is earnest money?
13. Who cannot give consent in a contract?
14. What are lucid intervals?
15. What are the conditions that vitiate consent?
16. When can mistake vitiate consent?
17. What are the requisites for intimidation to vitiate consent?
18. What are the requisites for undue influence to vitiate consent?
19. What are the kinds of fraud?
20. What the kinds of false consideration?
PROBLEM SOLVING
Problem 1. – Manny and Julian entered into a contract whereby Manny will
treat Julian out for lunch everyday for the next 2 weeks, if Julian will do
Manny’s Thesis. Manny however wanted to give additional “incentives” for
Julian because he needed the thesis in order to graduate on time. So, Manny
proposed that if Julian fails to deliver the Thesis on time then as penalty, Julian
has to let Manny go out on a date with Julian’s girlfriend. Julian then
responded that if Manny will give a penalty on him then he would also like a
provision in the agreement that if Julian delivers the thesis earlier than due date
then Manny must allow Julian to date Manny’s girlfriend. They both laughed
at these banter and then went on their respective ways.
Is Manny and Julian’s contract valid? Justify.
What kind of obligations were created by the contract? Justify.
PROBLEM SOLVING
Problem 1.(continued) – On due date, Manny went to get the thesis from Julian but
Julian was not yet finished with the thesis and could not deliver on time.
Manny thus said that Julian was in breach of the contract and therefore he is no
longer liable to treat Manny out for lunch. Furthermore, Julian had to let
Manny date Julian’s girlfriend as penalty. Julian countered that the contract
they entered into was contrary to law, good custom and morals since doing
other people’s thesis is an academic dishonesty and not part of good customs as
far as La Salle was concerned and dating another person’s girlfriend is non-
transmissible and immoral.
Is the contract contrary to law? Justify.
Is the contract contrary to Morals or Good Custom? Justify.
Is Julian and/or Manny liable for anything? Justify.
PROBLEM SOLVING
Problem 2. – Rene was selling his farmland in Laguna and advertised the same
at a facebook chat. He took pictures of the land and posted the same with an
area of around 8 hectares located beside the road with a price of P8M. He got a
response from Vic, a prospective buyer, who asked for an ocular visit in order
to check on the property. Rene took Vic to the place and started to extol the
good points of the property to Vic. Rene even showed the wide access road to
the property. Vic was impressed with the property which was ideal for his idea
to put up a farm. He immediately signed the contract of sale and paid Rene.
Later on, when Vic had misgivings on the property and started to have the
property measured and it turned out that the property was only 78,000 square
meters making it more expensive than if it were at 8 hectares and the supposed
access road was actually not as wide as it appeared to be. Because of these
circumstances, Vic wanted to annul the contract because of fraud or mistake
that vitiated his consent. Can Vic do so? Justify.
PROBLEM SOLVING
Problem 3. – James was at a bar drinking with some friends. After several
bottles of tequila, the friends noticed that James was talking to a girl at the bar
and signing a document, after which he gave the document to the girl and
staggered back to the table. When his friends asked him what that was all
about, he mumbled something about the girl had bought his car for ½ of its
value. The friends were shocked at this but James said that he and the girl had
already agreed upon the sale as early as yesterday and he just signed the
documents now. Besides, he knew that the girl would take care of his car and
that the girl needed it more than he did. Minutes after that James passed out
because of the amount of alcohol he had consumed.
If after James sobered up, can he assail the sale of the car due to vitiated
consent due to drunkeness? Justify.
Can he assail the contract due to the low price? Justify
Buslaw 1