CHAPTER 7 affidavit of the seller that he has

given written notice thereof to all

Article 1619. possible redemptioners.
LEGAL REDEMPTION or Retracto Legal ● Written notice indispensable
● The right to be subrogated (you will ● Mere knowledge does not satisfy the
have the rights of another), upon the requirement.
same terms and conditions
stipulated in the contract, in the ILLUSTRATIVE EXAMPLE:
place of one who acquires a thing by
purchase or dation in payment, or by In Cabales, et al. v. CA, et al., G.R. No. 162421,
any other transaction whereby August 31, 2007, a property was the subject of
ownership is transmitted by onerous co-ownership. The co-owners sold their
title. undivided shares in 1978 and informed the
others, like Nelson, a minor of the same in 1993.
● The right applies to both movable
He signified his intention to redeem the subject
and immovable property.
property during a barangay conciliation process
● It cannot occur in barter and in the but filed an action for legal redemption only in
transmission of property by 1995. Can he still exercise the right of
hereditary title. Evidently, the right redemption? Why?
is not available where there is only a
mortgage or lease. ANS: No, because he did it beyond the 30-day
period from the time he learned about the sale.
Subrogation: one party has the right to "step (Art. 1088 & 1623, NCC; Alonzo v. IAC, L-72873,
into the shoes" of another party to bring a May 28, 1987, 150 SCRA 259).
claim for damages.
To require strict proof of written notice of the sale
would be to countenance an obvious false claim
INSTANCES OF LEGAL REDEMPTION of lack of knowledge thereof, thus commending
1. Sale of a co-owner of his share to a the letter of the law over its purpose, i.e., the
stranger notification of redemptioners.
2. When a credit or other incorporeal
right in litigation is sold There was sufficient notice of the sale to Nelson.
3. Sale of an heir of his hereditary The thirty-day redemption period commenced in
rights to a stranger 1993, after Nelson sought the barangay
4. Sale of adjacent rural lands not conciliation process to redeem his property. By
January 12, 1995, when he filed a complaint for
exceeding 1 hectare
legal redemption and damages, it is clear that
5. Sale of adjacent small urban lands
the thirty-day period had already expired.
bought merely for speculation (Cabales, et al. v. CA, et al., G.R. No. 162421,
August 31, 2007).
● The right of legal redemption shall
not be exercised except within 30 Article 1620. A co-owner of a thing may
days from the notice in writing by the exercise the right of redemption in case
prospective seller, or seller, as the the shares of all the other co-owners or
case may be. The deed of sale shall of any of them, are sold to a third
not be recorded in the Registry of person. If the price of the alienation is
Property unless accompanied by an
grossly excessive, the redemptioner
shall pay only a reasonable one.
PRICE IN LEGAL REDEMPTION
Should two or more co-owners desire to 1. The purchase price paid by the owner to
exercise the right of redemption, they the selling co-owner.
may only do so in proportion to the 2. Reasonable price
share they may respectively have in the ● If the price of sale is grossly
thing owned in common. (1522a) excessive
3. Price understated in the deed of sale
REQUISITES OF LEGAL REDEMPTION ● If the court rules that the
CATBTR redemptioner shall pay the
(1) There must be a co-ownership of a UNDERSTATED price stated in the
thing. deed of sale, although the buyer
(2) There must be an alienation of all or paid much more originally.
any of the shares of the other co-owners; 4. Amount actually paid by the buyer
(3) The sale must be to a third person or ● If by false representations the
stranger, i.e., a non-co-owner. redemptioner pays an amount
(4) The sale must be before partition. greater (P100,000) than what the
(5) The right of redemption must be buyer obtained it for (P80,000). The
exercised within a period of 30 days from redemptioner may recover from the
the notice in writing given by the vendor. buyer the difference (P20,000) in an
(6) The vendee must be reimbursed for the appropriate action.
price of the sale.
RULES OF APPLICATION
ILLUSTRATIVE EXAMPLE:
1. A co-owner’s right to redeem is
A, B, and C are co-owners of a lot. A sold invoked only after the shares of the
his interest to X for P20,000. other co-owners are sold to a third
● B or C may redeem the interest from person or stranger. Hence if the
X by paying P20,000 (price of sale) purchaser is also a co-owner, there
● B and C may redeem the interest of is no legal redemption.
X by paying P10,000 each (half of 2. Should any of the heirs sell his
the share of A) hereditary right to a stranger
● If the price of P20,000 is grossly before partition, any or all of the
excessive, the price may be co-heirs may be subrogated to the
equitably reduced by the court. rights of the purchaser by
Redemptioner (B or C) shall pay reimbursing him for the purchase
only a reasonable price. price, provided it be done within the
period of one month to be counted
NOTE: The right of legal redemption is not from the time they were notified in
granted solely and exclusively to the original writing of the sale by the vendor.
co-owner but applies to those who Once the portion corresponding to
subsequently acquire their respective each heir is fixed, the co-heirs turn
shares while the co-ownership subsists. into co-owners and their right of
 legal redemption should be area, the one who first requested the
governed by Articles 1620 and 1623. redemption. (1523a)
3. The co-owner who desires to
redeem must tender the entire REQUISITES OF RIGHT OF LEGAL
amount of the real price or validity REDEMPTION OF ADJACENT OWNERS
and consign the same in court. This OF RURAL LANDS
is needed to show good faith.
1. Both the land of the one exercising the
WHEN THE RIGHT IS NOT AVAILABLE right of redemption and the land sought to
1. A former co-owner has NO right to be repurchased must be RURAL.
redeem because he has lost the 2. The land must be adjacent.
status of co-owner. 3. There must be an alienation.
2. Co-owners have no right to legal 4. The piece of rural land alienated must
redemption against each other, but not exceed one hectare.
only against a third person. 5. The vendee must already own any other
3. If the sale is made AFTER partition, rural land.
the right of legal redemption by a 6. The rural land sold must not be
co-owner cannot be invoked, there separated by brooks, drains, ravines,
being no more co-ownership. roads, and other apparent servitudes from
4. Some or one of the co-owners sells the adjoining lands.
their shares in the property owned in
common but not the case where all If two or more adjoining owners desire to
the co-owners have sold their exercise the right of redemption:
shares. 1. The adjacent owner of the small area
shall be preferred.
Article 1621. The owners of adjoining 2. If the lands have the same area, the one
lands shall also have the right of who first requested the redemption shall
redemption when a piece of rural land, be preferred.
the area of which does not exceed one
hectare, is alienated, unless the grantee RULES OF APPLICATION
does not own any rural land. 1. When the land exceeds one (1)
hectare, the adjacent owners are
This right is not applicable to adjacent not given the right of legal
lands which are separated by brooks, redemption because this may lead to
drains, ravines, roads and other the creation of big landed estates.
apparent servitudes for the benefit of 2. This right may be exercised only
other estates. against a stranger. For the right,
however, to be exercised against the
If two or more adjoining owners desire to stranger, the right must already have
exercise the right of redemption at the RURAL land (not an adjacent rural
same time, the owner of the adjoining one). The right cannot be exercised
land of a smaller area shall be preferred; against a vendee if he is also an
and should both lands have the same adjacent owner.
 3. In case 2 or more adjacent owners Redemption: It is exercised after the resale
desire to exercise the right of against the buyer.
redemption, the law gives
preference to the owner of the ● Adjacent owner
adjoining land of a smaller area but if (redemptioner/original vendor) shall
both lands have the same area, to pay a reasonable price.
the one who first requested the
redemption. REQUISITES OF RIGHT OF LEGAL
REDEMPTION OR PRE-EMPTION OF
REASON AND PURPOSE OF THE LAW ADJACENT OWNERS OF URBAN LANDS
● To foster the development of UASSSRP
agricultural areas by adjacent 1. The land is urban land.
owners who may desire the increase 2. The one exercising the right must be
for improvement of their own land. an adjacent owner.
3. The land sold must be so small and
so situated that a major portion
Article 1622. Whenever a piece of urban cannot be used for any practical
land which is so small and so situated purpose within a reasonable time.
that a major portion thereof cannot be 4. The urban land was bought by the
used for any practical purpose within a adjacent owner (redemptioner)
reasonable time, having been bought merely for speculation.
merely for speculation, is about to be 5. It is about to be resold (padung
re-sold, the owner of any adjoining land ibaligya ni vendee), or its resale
has a right of pre-emption at a (nabaligya na ni vendee) has been
reasonable price. perfected.

If the re-sale has been perfected, the If two or more adjoining owners desire to
owner of the adjoining land shall have a exercise the right of redemption or
right of redemption, also at a reasonable pre-emption:
price. When two or more owners of ● The adjoining owner whose
adjoining lands wish to exercise the right intended use of the land appears
of pre-emption or redemption, the owner to be justified is preferred.
whose intended use of the land in
question appears best justified shall be ILLUSTRATIVE EXAMPLE:
preferred. (n)
Having discovered that part of her ancestral
Pre-emption: Right of purchasing before house was erected on an adjoining lot of 59
others. It is exercised when the land is square meters, X wanted to exercise her
about to be resold against the ORIGINAL right of pre-emption but the lot owner asked
buyer (new vendor). for the exorbitant sum of P9,000. Later, the
● Adjacent owner 59-square-meter lot was sold to another
(redemptioner/original vendor) shall adjoining owner for only P1,500.
pay a reasonable price.
 ● X has a better right to the lord
because her intended use of the NOTE: The deed of sale cannot be
land appears to be best justified. Her registered without an affidavit from the
house was occupying the lot through vendor (original buyer) that he has given
no fault on her part. written notice to all possible redemptioners.

RULES OF APPLICATION NOTE: The right of redemption of

1. The price to be paid is a reasonable co-owners is preferred over that of adjoining
price. owners.
2. In case two or more owners of
adjoining lands wish to exercise the CHAPTER 8 - ASSIGNMENT OF CREDITS
right of pre-emption or redemption, AND OTHER INCORPOREAL RIGHTS
the owner whose intended use of
the land in question appears best Article 1624. An assignment of creditors
justified shall be preferred. and other incorporeal rights shall be
perfected in accordance with the
provisions of article 1475. (n)
REASON AND PURPOSE OF THE LAW
● To discourage speculation in real Assignment of credits: A contract where a
estate and the consequent person (assignor) transfers his credit, right,
aggravation of the housing problems or action against a third person (assignee)
in centers of population. for a consideration certain in money or its
equivalent.
Article 1623. The right of legal
pre-emption or redemption shall not be ● Contract for assignment or transfer
exercised except within thirty days from of credit and other incorporeal rights
the notice in writing by the prospective is perfected (EVEN IF THERE IS
vendor, or by the vendor, as the case NO DELIVERY) from the moment
may be. The deed of sale shall not be the parties agree upon:
recorded in the Registry of Property, 1. the credit or right assigned and;
unless accompanied by an affidavit of 2. the price
the vendor that he has given written 3. the assignee will acquire ownership
notice thereof to all possible only UPON DELIVERY.
redemptioners.
Ex. D owes C P5,000. C assigns his credit
The right of redemption of co-owners to T for consideration with notice to D. C is
excludes that of adjoining owners. the assignor while T is the assignee. D will
(1524a) have to make his payment to T.

Period of pre-emption: Within 30 days

from written notice by the prospective
vendor.
Period of redemption: Within 30 days
from written notice by the vendor.
Article 1625. An assignment of credit, 2. Before notice WITH knowledge of the
right, or action shall produce no effect assignment
against third persons unless it appears ● If the debtor pays to his original
in a public instrument, or the instrument creditor, he is not released from his
is recorded in the Registry of Property in obligation because he acted in bad
case the assignment involves real faith. He can be made to pay again
property. (1526) by the assignee.
3. After notice
FORM OF ASSIGNMENT OF CREDITS ● If the debtor pays to his original
1. Between the parties creditor, the payment is not valid
a. Valid and enforceable in any form against the assignee.
(oral, written, or partly oral and partly ● The debtor is not released from
written), as long as the law does not his obligation and can be made to
require a specific form for its validity. pay again by the assignee.

2. For binding effect (enforceable) NOTE: Consent of the debtor is not

against third persons. essential for the assignment to be effective.
a. If personal property is involved, an So even if wala mingconsent si debtor sa
assignment must appear in a public assignment after receiving notice, adto ra
instrument. gihapon siya sa assignee dapat mubayad.
b. If real property is involved, public
instruments must be recorded in NOTE: Actual notice of assignment MUST
the Registry of Property. be given to the debtor.

NOTE: If the assignment only appears in Article 1627. The assignment of credit
a private instrument, the assignment is includes all the accessory rights, such
only enforceable among the parties and not as a guaranty, mortgage, pledge, or
to third persons. preference. (1528)

General Rule: The accessory follows the

Article 1626. The debtor who, before principal.
having knowledge of the assignment,
pays his creditor shall be released from Exception: Parties may stipulate that the
the obligation. (1527) accessory rights shall not be included in
the assignment.
EFFECT OF PAYMENT BY THE DEBTOR
AFTER ASSIGNMENT OR CREDIT ILLUSTRATIVE EXAMPLE:
1. Before notice WITHOUT knowledge of
the assignment D obtained a loan from C amounting to
● The debtor is released from his P200,000. The loan is secured by a
obligation if he pays his creditor mortgage of D’s lot. If C assigns his credit
WITHOUT knowledge of the right to X with notice, the mortgage is also
assignment. considered assigned unless there is a
stipulation to the contrary.
 ● If D defaults in his payment, X can ● If the credit right is in litigation, the
ask for the foreclosure of the credit is doubtful because whether D
mortgage. The property will be sold is liable or not to C depends upon
and the proceeds applied to the the outcome of the case. If X cannot
payment of the loan. collect from D because the court
released D from his liability, X
D owes C P200,000 with G as guarantor. C cannot hold C liable.
assigned his credit to X with notice given to ● If C lacks sufficient data to
D. determine whether the credit is still
● If D defaults in his payment, X may enforceable or not and that fact was
enforce the guaranty of G unless the fully disclosed upon assignment, X
credit was transferred with the cannot hold C liable.
express stipulation that G shall be
released from his obligation. 2. Solvency of the debtor ONLY when:
a. There is a stipulation; or
Article 1628. The vendor in good faith b. The insolvency already existed prior
shall be responsible for the existence to the sale and of public knowledge.
and legality of the credit at the time of
the sale unless it should have been sold D owes C P10,000. The debt is evidenced
as doubtful; but not for the solvency of by a promissory note. Thereafter, C
the debtor, unless it has been so assigned his credit right to X.
expressly stipulated or unless the ● If X cannot collect from D because D
insolvency was prior to the sale and of was insolvent, X can only hold C
common knowledge. liable if:
a. it was expressly stipulated;
WARRANTIES OF THE ASSIGNOR b. the insolvency existed prior to the
1. Legality and existence of the credit sale and was of public knowledge
at the time of sale. although C was not aware; or
c. the insolvency existed prior to the
Exception: There is no warranty if the sale and was known to C although
credit was sold as doubtful. it was not of public knowledge.

D owes C P10,000. The debt is evidenced Even in these cases, he shall only be liable
by a promissory note. Thereafter, C for the price received and for the expenses
assigned his credit right to X. specified in No. 1 of article 1616 (the price
● If X cannot collect from D because of the sale; and expenses of the contract
the note was issued for an illegal and other legitimate expenses).
gambling debt, C will be liable to X
for breach of warranty as to the The vendor in bad faith shall always be
legality of the credit. answerable for the payment of all expenses,
● If X cannot collect from D because and for damages. (1529)
the debt had been prescribed, C will
be liable to X for breach of warranty
as to the existence of the credit.
LIABILITY OF THE ASSIGNOR WHEN D owes C P5,000 payable on October 1,
WARRANTIES ARE VIOLATED 2022. C assigned his credit to T with an
express warranty on the solvency of D.
1. Assignor in good faith (PEL)
● Price received. ● If the agreement is that the duration
● Expenses of the contract. of C’s liability shall last for two years
● Other legitimate payments by from Oct 1, 2022, then such shall be
reason of the assignment. followed.
● If there is no stipulation and the
2. Assignor in bad faith (PELD) assignment was made on
● Price received. November 1, 2022, the liability is
● Expenses of the contract. limited to one year from the
● Other legitimate payments by assignment. (ASSIGNMENT AFTER
reason of the assignment. MATURITY)
● Damages.
If there is no stipulation and the
Article 1629. In case the assignor in assignment was made on September 1,
good faith should have made himself 2022, the liability is limited to exactly one
responsible for the solvency of the year after October 1, 2022, or October 1,
debtor, and the contracting parties 2023.
should not have agreed upon the (ASSIGNMENT BEFORE MATURITY).
duration of the liability, it shall last for
one year only, from the time of the NOTE: Provision is inapplicable if the
assignment if the period had already assignor is in bad faith.
expired.
Article 1630. One who sells an
If the credit should be payable within a inheritance without enumerating the
term or period which has not yet expired, things of which it is composed shall only
the liability shall cease one year after the be answerable for his character as an
maturity. (1530a) heir. (1531)

DURATION OF THE ASSIGNOR’S Warranty of Heirship: He shall only

LIABILITY IF THE ASSIGNOR warrant the facts of his heirship but not of
EXPRESSLY WARRANTED THE the things composing the inheritance,
SOLVENCY OF THE DEBTOR unless such things were enumerated.

1. The period stipulated NOTE: Provision contemplates the sale of

2. If there is no stipulation: successional right or the right to inheritance
a. If the assignment was made before partition.
BEFORE maturity, 1 year from ● Inheritance may be sold either with
maturity. or without specification of the
b. If the assignment was made AFTER properties to be alienated.
maturity, 1 year from the time of
assignment.
B and C are the heirs of the estate left by A. S, a partnership in a partnership, sold all his
Before partition and without specifying his interest to B for the lump sum of P150,000.
definite share in the inheritance, B sold his Upon dissolution of the partnership, B
share to X for P100,000. received S’ share in assets consisting of
P50,000, office equipment, and a car.
● B only warrants the fact that he is an ● If a creditor of the partnership
heir of A. B is not liable to X if his recovered the car from B, S shall not
inheritance after the partition has a be liable to B.
value of less than P100,000. ● If a creditor of the partnership
recovered the entire share or only
Article 1631. One who sells for a lump the car which was worth P80,000, S
sum the whole of certain rights, rents, or shall be liable to B. (Value of the car
products, shall comply by answering for exceeded 50% of the amount paid)
the legitimacy of the whole in general;
but he shall not be obliged to warrant Article 1632. Should the vendor have
each of the various parts of which it may profited by some of the fruits or received
be composed, except in the case of anything from the inheritance sold, he
eviction from the whole or the part of shall pay the vendee thereof, if the
greater value. (1532a) contrary has not been stipulated. (1533)

VENDOR’S WARRANTY FOR LUMP SUM Article 1537: All fruits shall pertain to the
SALE OF THE WHOLE OF CERTAIN vendee from the day on which the contract
RIGHTS, RENTS OR PRODUCTS was perfected.

● The vendor warrants the General Rule: The fruits of an

legitimacy of the whole, but he is INHERITANCE are included in the sale
not obliged to warrant each of the thereof, unless there is a contrary
parts of which it may be composed, stipulation.
except when the vendee is evicted: ● If the vendor merely received the
fruits, he must deliver them to the
1. From the whole of the thing; or vendee.
2. From the part of the greater value. ● If the vendor consumed the fruits, he
must reimburse the vendee.
S sold his receivables from more than 50 ● If the vendor sold the fruits, he must
customers to B for P1,000,000. deliver the price of the sale.
● If B was deprived of the amount of
P20,000 representing an alleged Article 1633. The vendee shall, on his
receivable from D, S shall not be part, reimburse the vendor for all that the
liable because the warranty of S is latter may have paid for the debts of and
on the legitimacy of the whole. charges on the estate and satisfy the
● If B was deprived of the whole credits he may have against the same,
receivables or more than 50% unless there is an agreement to the
thereof, S shall be liable to B. contrary. (1534)
 ● Any debts and charges on the estate
paid by the vendor shall be 4. The assignee must have demanded
reimbursed by the vendee unless payment from the debtor.
there is a contrary stipulation. 5. Right of legal redemption of debtor
when a credit or other incorporeal
Article 1634. When a credit or other rights in litigation is sold:
incorporeal right in litigation is sold, the
debtor shall have a right to extinguish it ● The debtor shall have the
by reimbursing the assignee for the price right to extinguish his
the latter paid therefor, the judicial costs obligation by reimbursing the
incurred by him, and the interest on the assignee of the following:
price from the day on which the same 1. Price paid by the assignee
was paid. for the right purchased.
2. Judicial costs incurred by
A credit or other incorporeal right shall him.
be considered in litigation from the time 3. Interest on the price from
the complaint concerning the same is the day on which assignee
answered. paid the assignor.

The debtor may exercise his right within 6. Period within which the debtor may
thirty days from the date the assignee exercise the right/reimburse the
demands payment from him. (1535) assignee
● Within thirty days from the
WHEN RIGHT CONSIDERED IN date the assignee demands
LITIGATION payment from him.
● The credit or other incorporeal right
shall be considered in litigation from D borrowed P5,000 from C. When D
the time the complaint concerning did not pay the debt upon demand
the same is answered. by C, C filed a complaint against him
to collect the debt and D answered
REQUISITES OF RIGHT OF LEGAL the complaint. Here, the credit right
REDEMPTION IN SALE OF CREDIT OR is considered in litigation. Thereafter,
OTHER RIGHT IN LITIGATION C sold his credit right to X for
(SALPDRP) P4,000.
1. There must be a sale or
assignment of credit. ● D may exercise his right of
2. The credit or other incorporeal right legal redemption by
must be in litigation. reimbursing the assignee of
3. There must be a PENDING the P4,000, judicial costs
LITIGATION at the time of the incurred by D, and interest
assignment. The complaint by the on the P4,000 (from the day
assignor must have been filed, and X paid the amount to C).
answered by the debtor before the
sale of credit.
 ● Reimbursement must be CHAPTER 9 - GENERAL PROVISIONS
done within 30 days from the
demand of X Article 1636. In the preceding articles in
this Title governing the sale of goods,
unless the context or subject matter
Article 1635. From the provisions of the otherwise requires:
preceding article shall be excepted the
assignments or sales made: DEFINITION OF TERMS
(1) "Document of title to goods" includes
The debtor’s right of redemption shall not be any bill of lading, dock warrant, "quedan," or
available when the assignment of the right warehouse receipt or order for the delivery
of litigation is made: of goods, or any other document used in the
ordinary course of business in the sale or
(1) To a co-heir or co-owner of the right transfer of goods, as proof of the
assigned possession or control of the goods, or
authorizing or purporting to authorize the
Ex. Nangutang si D ni X and Y. X and Y possessor of the document to transfer or
sued D for collection and D answered the receive, either by indorsement or by
complaint. While the case was pending, X delivery, goods represented by such
sold his share of credit to Y. D cannot document.
redeem the share of X from Y.
"Goods" includes all chattels personal but
(2) To a creditor in payment of his credit not things in action or money of legal tender
in the Philippines. The term includes
Ex. Nangutang si D ni X, unya si X naay growing fruits or crops.
utang ni C. X sued D for collection and D
filed his answer. While the case was Items not included in the term “Goods”
pending, X assigned his credit right C. D
cannot redeem against C. 1. Thing/Chose in Action - Any claim or
right which may be pleaded in a suit of
(3) To the possessor of a tenement or law.
piece of land which is subject to the right in
litigation assigned. (1536) Ex. A claim of reparation for a torr or right
guaranteed under certain types of contracts.
● Same ang person na gibaligyaan
and giassignan. 2. Legal tender - Currency which a
debtor can legally compel a creditor to
Ex. D obtained a loan from C, where D accept in payment of a debt in money
mortgaged his lot to secure the debt. Then, when tendered by the debtor in the right
D sold his lot to X. When D could not pay, C amount.
sued D. While the case was pending, C
assigned his credit to X. D has no right of "Order" relating to documents of title
legal redemption against X. means an order by indorsement on the
documents.
"Quality of goods" includes their state or TITLE VII - BARTER OR EXCHANGE
condition.
Article 1638. By the contract of barter or
"Specific goods" means goods identified exchange one of the parties binds
and agreed upon at the time a contract of himself to give one thing in
sale is made. consideration of the other's promise to
give another thing. (1538a)
An antecedent or pre-existing claim,
whether for money or not, constitutes Barter: Where instead of paying a price in
"value" where goods or documents of title money, another thing is given in lieu thereof.
are taken either in satisfaction thereof or as
security therefor. Barter: A contract whereby one transfers
the ownership of non-fungible things to
(2) A person is insolvent within the another with the obligation on the part of the
meaning of this Title who either has ceased latter to give things of the same kind,
to pay his debts in the ordinary course of quantity, and quality.
business or cannot pay his debts as they
become due, whether insolvency ● Perfected from the moment there is
proceedings have been commenced or not. a meeting of minds upon the things
promised.
(3) Goods are in a "deliverable state" ● Consummated from the time of
within the meaning of this Title when they mutual delivery of the things
are in such a state that the buyer would, promised.
under the contract, be bound to take
delivery of them. (n) NOTE: View pages 227-228 for examples
on barter and usufruct. View Article 1468 for
Article 1637. The provisions of this Title the difference between sale and barter.
are subject to the rules laid down by the
Mortgage Law and the Land Registration Article 1639. If one of the contracting
Law with regard to immovable property. parties, having received the thing
(1537a) promised him in barter, should prove
that it did not belong to the person who
● Under the Mortgage Law and the gave it, he cannot be compelled to
Land Registration Law, the deliver that which he offered in
registration of documents or titles exchange, but he shall be entitled to
pertaining to immovable property is damages. (1539a)
the operative act that binds the
property. Only after registration shall ● Nakadawat si A sa thing promised
the right of third persons be from B, pero na prove ni A na dili
adversely affected by the sale diay to under the ownership of B ang
thing.
RIGHTS OF AGGRIEVED PARTY
1. He cannot be compelled to deliver
the thing he offered in the barter
2. He is entitled to damages.

Article 1640. One who loses by eviction

the thing received in barter may recover
that which he gave in exchange with a
right to damages, or he may only
demand an indemnity for damages.
However, he can only make use of the
right to recover the thing which he has
delivered while the same remains in the
possession of the other party, and
without prejudice to the rights acquired
in good faith in the meantime by a third
person. (1540a)

REMEDIES OF PARTY WHO WAS

DEPRIVED OF THE THING RECEIVED IN
BARTER THROUGH EVICTION

1. Recover the thing given in exchange

with damages; or
2. Recover damages only

NOTE: Aggrieved party can only recover

the thing given when it is still in possession
of the other contracting party. If it has been
sold to a purchaser in good faith, the thing
can no longer be recovered.

Article 1641. As to all matters not

specifically provided for in this Title,
barter shall be governed by the
provisions of the preceding Title relating
to sales. (1541a)
● Provisions on sales are also
applicable to barter.