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RULES ON RISK OF LOSS AND DETERIORATION:

The thing sold is lost before perfection: Seller bears the loss.

The thing sold is lost at the time of perfection: Contract is void or inexistent.

The thing sold is lost after perfection, but before delivery:

differing (GENERAL RULE: Who bears the risk of loss is governed by the stipulations in the contract

In the absence of any stipulation:

First view:

Buyer bears the loss as an exception to the rule of res perit domino.

(EXCEPTIONS:

when object sold consists of fungible goods for a price fixed according to weight, number or measure

seller is guilty of fraud, negligence, default or violation of contractual terms

object sold is generic

(Civil Code of the Philippines, Paras)

NOTE: This view conforms with Manresa’s view. Buyer would have been the one to profit from the

thing had it not been lost or destroyed.

Contrary view:

Where the ownership is transferred by delivery, as in our code, the application of the axiom res perit

domino, imposes the risk of loss upon the vendor; hence, if the thing is lost by fortuitous event before

delivery, the vendor suffers the loss and cannot recover the price from the vendee (Commentaries

and Jurisprudence on the Civil Code of the Philippines, Tolentino)

The thing is lost after delivery: Buyer bears the loss.

Question: If one does not comply, the other need not pay?

Answer: True. But this only applies when the seller is able to deliver but does not.

Effect of loss at the time of sale:

Thing entirely lost at the time of perfection: Contract is void and inexistent

Thing only partially lost: Vendee may elect between withdrawing from the contract or demanding the

remaining part, paying its proportionate price

Sale by description

A sale where a seller sells things as being of a certain kind, buyer merely relying on the seller’s

representations or descriptions.

There is warranty that the thing sold corresponds to the representations or descriptions.

Sale by sample

A sale where a small quantity of a commodity is exhibited by the seller as a fair specimen of the bulk,

which is not present and as to which there is no opportunity to inspect or examine.

NOTE: The mere exhibition of the sample does not necessarily make it a sale by sample. This

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exhibition must have been the sole basis or inducement of the sale.

There is warranty that the bulk of the commodity will correspond in kind, quality, and character with

the sample exhibited.

NOTE: In a sale by sample and by description, there is a two-fold warranty.

RIGHTS OF BUYER:

1) Return the thing and recover the money paid, or

2) Retain the thing and sue for the breach of warranty.