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VIII. RULES ON RISK OF LOSS AND DETERIATION - Coggle Diagram
VIII. RULES ON RISK OF LOSS AND DETERIATION
A. GENERAL RULES
B. LOSS PRIOR TO PERFECTION OF CONTRACT
C. LOSS AT TIME OF PERFECTION OF CONTRACT
D. LOSS AFTER PERFECTION OF CONTRACT BUT BEFORE DELIVERY
1. GENERAL RULE
2. LOSS BY FAULT OF A PARTY
3. LOSS BY FORTUITOUS EVENTS
4. FRUITS OF IMPROVEMENTS
VENDOR MUST DELIVER THING
WITH ACCESSIONS + ACCESSORIES
UPON PERFECTION
Article 1537. The vendor is bound to deliver the thing sold and its accessions and accessories in the condition in which they were upon the perfection of the contract.
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1163-1165 + 1262 GOVERN
Article 1480. Any injury to or benefit from the thing sold, after the contract has been perfected, from the moment of the perfection of the contract to the time of delivery, shall be governed by articles 1163 to 1165, and 1262.
APPLICABLE TO FUNGIBLE THINGS
INDEPENDENTLY
SINGLE PRICE
WITHOUT CONSIDERATION TO
a.
WEIGHT
b.
NUMBER
c.
MEASURE
This rule shall apply to the sale of fungible things, made independently and for a single price, or without consideration of their weight, number, or measure.
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DILIGENCE OF GOOD FATHER OF A FAMILY
Article 1163. Every person obliged to give something is also obliged to take care of it with the proper diligence of a good father of a family,
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1163-1165 + 1262 GOVERN
Article 1480. Any injury to or benefit from the thing sold, after the contract has been perfected, from the moment of the perfection of the contract to the time of delivery, shall be governed by articles 1163 to 1165, and 1262.
SELLER'S RISK UNTIL
TRANSFER OWNERSHIP TO BUYER
Article 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to the buyer,
LDI BEFORE DELIVERY -> 1189
Article 1538. In case of loss, deterioration or improvement of the thing before its delivery, the rules in article 1189 shall be observed, the vendor being considered the debtor. (n)
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BUYER'S RISK UPON
TRANSFER OWNERSHIP TO BUYER
but when the ownership therein is transferred to the buyer the goods are at the buyer's risk whether actual delivery has been made or not, except that:
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APPLICABLE TO FUNGIBLE THINGS
INDEPENDENTLY
SINGLE PRICE
WITHOUT CONSIDERATION TO
a.
WEIGHT
b.
NUMBER
c.
MEASURE
This rule shall apply to the sale of fungible things, made independently and for a single price, or without consideration of their weight, number, or measure.
VENDEE DOES NOT ASSUME RISK
UNTIL W/C/M + D
Should fungible things be sold for a price fixed according to weight, number, or measure, the risk shall not be imputed to the vendee until they have been weighed, counted, or measured and delivered,
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E. AFTER DELIVERY OF THE THING
F. SPECIFIC TRANSACTIONS
G. RULES ON RISK OF LOSS & DETERIORATION FOR ACTS OF
SELLER OR BUYER
1163-1165 + 1262 GOVERN
Article 1480. Any injury to or benefit from the thing sold, after the contract has been perfected, from the moment of the perfection of the contract to the time of delivery, shall be governed by articles 1163 to 1165, and 1262.
APPLICABLE TO FUNGIBLE THINGS
INDEPENDENTLY
SINGLE PRICE
WITHOUT CONSIDERATION TO
a.
WEIGHT
b.
NUMBER
c.
MEASURE
This rule shall apply to the sale of fungible things, made independently and for a single price, or without consideration of their weight, number, or measure.
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DETERMINATE -> MAY COMPEL DELIVERY
Article 1165. When what is to be delivered is a determinate thing, the creditor, in addition to the right granted him by article 1170, may compel the debtor to make the delivery.
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1. TRANSFER OF OWNERSHIP OF GOODS TO THE BUYER WITHOUT ACTUAL DELIVERY
2. RETENTION OF TITLE BY SELLER ONLY FOR SECURITY
3. CONDITIONAL SALES
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SELLER'S RISK UNTIL
TRANSFER OWNERSHIP TO BUYER
Article 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to the buyer,
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SELLER'S RISK UNTIL
TRANSFER OWNERSHIP TO BUYER
Article 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to the buyer,
BUYER'S RISK UPON
TRANSFER OWNERSHIP TO BUYER
but when the ownership therein is transferred to the buyer the goods are at the buyer's risk whether actual delivery has been made or not, except that:
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SELLER'S RISK UNTIL
TRANSFER OWNERSHIP TO BUYER
Article 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to the buyer,
IF
LOST
AWARE VENDOR
THEN
VENDOR BEARS:
LOSS
RETURN PRICE
REFUND CONTRACT EXPENSES
Article 1568. If the thing sold should be lost in consequence of the hidden faults, and the vendor was aware of them, he shall bear the loss, and shall be obliged to return the price and refund the expenses of the contract, with damages.
HIDDEN DEFECT AT SALE + LOST BY FE/F
=
VENDEE MAY DEMAND:
PRICE PAID - VALUE OF THING AT LOSS
Article 1569. If the thing sold had any hidden fault at the time of the sale, and should thereafter be lost by a fortuitous event or through the fault of the vendee, the latter may demand of the vendor the price which he paid, less the value which the thing had when it was lost.
VENDOR'S BF -> DAMAGES
If the vendor acted in bad faith, he shall pay damages to the vendee. (1488a)
NOT AWARE, THEN:
RETURN PRICE & INTEREST
REIMBURSE ONLY VENDEE'S PAID CONTRACT EXPENSES
If he was not aware of them, he shall only return the price and interest thereon, and reimburse the expenses of the contract which the vendee might have paid. (1487a)
So vendor refunds expenses vendor paid for?
BUYER'S RISK UPON
TRANSFER OWNERSHIP TO BUYER
but when the ownership therein is transferred to the buyer the goods are at the buyer's risk whether actual delivery has been made or not, except that:
BUYER'S RISK IF:
RETENTION
a.
DELIVERED TO BUYER or BAILEE
b.
SELLER RETAINS OWNERSHIP
c.
FOR SECURITY
(1) Where delivery of the goods has been made to the buyer or to a bailee for the buyer, in pursuance of the contract and the ownership in the goods has been retained by the seller merely to secure performance by the buyer of his obligations under the contract, the goods are at the buyer's risk from the time of such delivery;
FAULT PARTY IF:
DELAYED ACTUAL DELIVERY
a.
BUYER/SELLER'S FAULT
(2) Where actual delivery has been delayed through the fault of either the buyer or seller the goods are at the risk of the party in fault. (n)
UNLESS OTHERWISE AGREED
1163-1165 + 1262 GOVERN
Article 1480. Any injury to or benefit from the thing sold, after the contract has been perfected, from the moment of the perfection of the contract to the time of delivery, shall be governed by articles 1163 to 1165, and 1262.
APPLICABLE TO:
FUNGIBLE THINGS
a.
INDEPENDENTLY
b.
PRICE
-
SINGLE
OR
-
WITHOUT CONSIDERATION TO
--
WEIGHT/NUMBER/MEASURE
This rule shall apply to the sale of fungible things, made independently and for a single price, or without consideration of their weight, number, or measure.
IF W/C/M
B DOES NOT ASSUME RISK
UNTIL W/C/M + D
Should fungible things be sold for a price fixed according to weight, number, or measure, the risk shall not be imputed to the vendee until they have been weighed, counted, or measured and delivered,
B'S DELAY
unless the latter has incurred in delay. (1452a)
RULES
(DF-DG-F)
DADDY DILIGENCE (SELLER)
Article 1163. Every person obliged to give something is also obliged to take care of it with the proper diligence of a good father of a family,
FRUITS: PERSONAL RIGHTS (BUYER)
a.
REAL RIGHT AT DELIVERY
Article 1164. The creditor has a right to the fruits of the thing from the time the obligation to deliver it arises.
However, he shall acquire no real right over it until the same has been delivered to him. (1095)
ACCESSIONS & ACCESSORIES
a.
PERFECTION STATE
Article 1537. The vendor is bound to deliver the thing sold and its accessions and accessories in the condition in which they were upon the perfection of the contract.
All the fruits shall pertain to the vendee from the day on which the contract was perfected. (1468a)
ACCESSION -> ATTACHED
ACCESSORIES -> FOR COMPLETION
(Project Jurisprudence)
DETERMINATE -> MAY COMPEL DELIVERY
Article 1165. When what is to be delivered is a determinate thing, the creditor, in addition to the right granted him by article 1170, may compel the debtor to make the delivery.
GENERIC -> ASK BE DEBTOR'S EXPENSE
If the thing is indeterminate or generic, he may ask that the obligation be complied with at the expense of the debtor.
LOSS/DETERIORATION/IMPROVE -> 1189
Article 1538. In case of loss, deterioration or improvement of the thing before its delivery, the rules in article 1189 shall be observed, the vendor being considered the debtor. (n)
IF:
CONDITION SUSPENDING GIVING
LDI
a.
PENDING CONDITION
Article 1189. When the conditions have been imposed with the intention of suspending the efficacy of an obligation to give,
the following rules shall be observed in case of the improvement, loss or deterioration of the thing during the pendency of the condition:
THEN:
EXTINGUISHED
a.
LOST
b.
WITHOUT DEBTOR'S FAULT
(1) If the thing is lost without the fault of the debtor, the obligation shall be extinguished;
X X X
BORNE BY CREDITOR
a.
DETERIORATES
b.
WITHOUT DEBTOR'S FAULT
(3) When the thing deteriorates without the fault of the debtor, the impairment is to be borne by the creditor;
X X X
LOSS OF GENERIC -> NO EXTINGUISH
Article 1263. In an obligation to deliver a generic thing, the loss or destruction of anything of the same kind does not extinguish the obligation. (n)
LOSS OF DETERMINATE THING EXTINGUISHED IF:
LOST/DESTROYED
WITHOUT DEBTOR'S:
a.
FAULT
b.
DELAY
Article 1262. An obligation which consists in the delivery of a determinate thing shall be extinguished if it should be lost or destroyed without the fault of the debtor, and before he has incurred in delay...
[1262]
IF FORTUITOUS EVENT, S
LIABLE IF:
[DPs2d-LSN]
DELAY OF S
PROMISED TO DELIVER:
a.
SAME THING to:
b.
2 or MORE PERSONS w/
c.
DIFF INTEREST
If the obligor delays, or has promised to deliver the same thing to two or more persons who do not have the same interest, he shall be responsible for any fortuitous event until he has effected the delivery. (1096)
DEBTOR'S RIGHTS
AGAINST 3RD PERSONS FOR LOSS
CREDITOR'S RIGHTS TOO
Article 1269. The obligation having been extinguished by the loss of the thing, the creditor shall have all the rights of action which the debtor may have against third persons by reason of the loss. (1186)
LIABLE + DAMAGES FOR FE IF:
LAW
STIPULATION
NATURE = ASSUMED RISK
...When by law or stipulation, the obligor is liable even for fortuitous events, the loss of the thing does not extinguish the obligation, and he shall be responsible for damages.
The same rule applies when the nature of the obligation requires the assumption of risk. (1182a)
[1262]
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UNLESS:
LAW
STIPULATION
unless the law or the stipulation of the parties requires another standard of care. (1094a)
NO CAUSE/OBJECT AT TRANSACTION -> VOID
Article 1409. The following contracts are inexistent and void from the beginning:
X X X
(3) Those whose cause or object did not exist at the time of the transaction;
X X X
DETERIORATION
SPECIFIC GOODS
IF
WITHOUT S' KNOWLEDGE
SUBSTANTIAL CHANGE IN CHAR
-
PERISH IN PART
-
DETERIORATED
a.
WHOLLY
b.
MATERIAL
Article 1494. Where the parties purport a sale of specific goods, and the goods
without the knowledge of the seller have
perished in part
OR
have wholly or in a material part so
deteriorated in quality
as to be
substantially changed in character, the buyer may at his option treat the sale:
THEN:
BUYER MAY:
AVOID
(1) As avoided; or
VALID
a.
AS TO GOODS NOT DETERIORATED
b.
BINDING BUYER TO PAY PRICE FOR
-
GOODS IN WHICH OWNERSHIP PASSES
(2) As valid in all of the existing goods or in so much thereof as have not deteriorated, and as binding the buyer to pay the agreed price for the goods in which the ownership will pass,
if the sale was divisible. (n)
TOTAL LOSS AT PERFECTION -> VOID
Article 1493. If at the time the contract of sale is perfected, the thing which is the object of the contract has been entirely lost, the contract shall be without any effect.
PARTIAL LOSS AT PERFECTION:
WITHDRAW
DEMAND REMAINING PART
a.
PRICE IN PROP TO TOTAL SUM AGREED
But if the thing should have been lost in part only, the vendee may choose between withdrawing from the contract and demanding the remaining part, paying its price in proportion to the total sum agreed upon. (1460a)
PARANG PAREHO REMEDIES?
WITHDRAW/AVOID
DEMAND REMAINING
a.
IF DIVISIBLE
DETERIORATION vs LOSS
DETERIORATION
a.
SUBSTANTIAL CHANGE IN CHAR
LOSS
SELLER'S RISK UNTIL
TRANSFER OWNERSHIP TO BUYER
Article 1504. Unless otherwise agreed, the goods remain at the seller's risk until the ownership therein is transferred to the buyer,
BUYER'S RISK UPON
TRANSFER OWNERSHIP TO BUYER
but when the ownership therein is transferred to the buyer the goods are at the buyer's risk whether actual delivery has been made or not, except that:
BUYER'S RISK IF:
RETENTION FOR SECURITY
(1) Where delivery of the goods has been made to the buyer or to a bailee for the buyer, in pursuance of the contract and
the ownership in the goods has been retained by the seller merely to secure performance by the buyer of his obligations under the contract,
the goods are at the buyer's risk from the time of such delivery;
FAULT PARTY IF:
DELAYED ACTUAL DELIVERY
a.
BUYER/SELLER'S FAULT
(2) Where actual delivery has been delayed through the fault of either the buyer or seller the goods are at the risk of the party in fault. (n)
NO PERFECTION = BEFORE PERFECTION
Here, there was loss before perfection (as there was no perfection at all) as Grimalt did not consent to the sale without Roman’s perfected titles. o Thus, Seller Roman shall bear the loss of the vessel.
[Roman v. Grimalt]
GENERIC THING LOST -> NO EXTINCT
Article 1263. In an obligation to deliver a generic thing, the loss or destruction of anything of the same kind does not extinguish the obligation. (n)