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Code III - Sales Flashcards

1
Q

Sale

A

contract whereby a person transfers OWNERSHIP of a thing to another for a PRICE IN MONEY

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2
Q

Formal Sales Requirements

A

Immovable = in writing
movable = can be sold orally

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3
Q

Elements of a Valid Sale

A
  1. Consent
  2. The Object
  3. The Price
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4
Q

Consent

A

established through offer and acceptance

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5
Q

Acceptance Varying from Offer

A

Immovables = Counter offer

Movables = if agreement on thing and price, additional terms are regarded as PROPOSALS FOR MODIFICATION must be accepted by offeror to become part of the contract

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6
Q

Special Rules Regarding Merchants (Acceptance Varying from Offer)

A

Additional terms become a part of the contract unless:

  1. terms materially alter the offer
  2. offer expressly limits acceptance to the terms of the offer
  3. offeror objects within reasonable time
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7
Q

The Object

A

all things corporeal or incorporeal susceptible of ownership may be sold unless prohibited by law

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8
Q

Litigious Redemption

A

litigious rights may be sold

party against whom the right has been transferred may get himself released by paying to the transferee the price he paid

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9
Q

Sale of Future things

A

the coming into existence of the thing acts as a suspensive condition and the buyer does not assume the risk

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10
Q

Sale of a Hope

A

assume the risk that the thing will not materialize

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11
Q

The Price

A

must be in MONEY, if it is not then it is not a sale but an exchange

Must be certain or determinable through a method agreed upon

IF sale is a movable of kind the seller habitually sells, and no price agreed, price term will be implied - a reasonable price

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12
Q

Perfection of the Sale

A

The thing, the price, and the consent of the parties are required

NEITHER payment nor delivery is essential

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13
Q

Ownership

A

Passes to the buyer upon perfection of the sale

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14
Q

Risk of loss

A

due to fortuitous (could not have been reasonably foreseen) events transferred to the buyer when DELIVERED

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15
Q

Agreements with Perfection Delayed

A
  1. Suspensive Condition
  2. Sale of Future Thing
  3. Promis to contract to Sell
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16
Q

Options

A

Grantor of the option is bound to buy or sell if the grantee of the option accepted within stipulated time

MUST specify thing and the price, have a term, and be in writing for IMMOVABLES

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17
Q

Term Requirement (Option)

A

an option contract MUST have a term

if Option is part of another contract (lease) option’s term is coextensive with the term of that contract

If indefinite duration option coextensive with contract is INVALID FOR LACK OF A DEFINITE TERM

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18
Q

Right of First Refusal

A

grantor MAY not sell 3p without first offering to sell to holder of the right

May be enforced by specific performance

Need NOT contain term

Affecting Immovable property MUST be in writing

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19
Q

Contract to Sell

A

parties promise to enter into a sale at a later date

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20
Q

Earnest Money in Contract to Sell

A

Amount given to the seller by the buyer to secure the parties interests in case of breach

parties must EXPRESSLY STIPULATE the sum is earnest money

Negates availability of specific performance and recovery of actual damages

both parties have the right to recede

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21
Q

Receding in Contract with Earnest Money

A
  1. if buyer recedes, he forfeits earnest money given previously
  2. If Seller recedes, he returns double the amount of earnest money to buyer
  3. If failure to perform is excused, earnest money is not owed
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22
Q

Contract to Sell Prescription

A

if an immovable action for breach or other failure is 5 years

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23
Q

Time Limits for Exercise of Right of First Refusal

A

holder of right has 10 days if movable, 30 if immovable (CAN BE CONTRACTED AROUND)

If decides not to buy, right remains unless grantor concludes a final sale to 3p within 6 months

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24
Q

Time Limits for Options and Right First Refusal on Immovables

A

cannot be granted for a term longer than 10 years if it is its reduced to 10 (unless connected to k with continuous or periodic performance ie rent)

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25
Effect against third parties (options, rights of first refusal, and contracts to sell)
immovables = subject to public record doctrine movables = binding with actual knowledge
26
Doctrine of Implied Warranty of Merchantability
protects buyer from being compelled to accept a flawed title buyer may refuse to enter into the sale if the title is suggestive of serious litigation
27
Construction of Contracts (Seller)
Must explain themselves clearly in a contract ambiguity will be construed against her
28
Seller's Obligations
1. Deliver the thing; AND 2. Warranting the thing: - Against evicition - Against Redhibitory defects; AND - is reasonably fit for its ordinary or intended use
29
Delivery
If seller remains in possession = presumption the sale is a simulation
30
Untimely Delivery by Seller
buyer demand DISSOLUTION of the sale or SPECIFIC PERFORMANCE either case seller is liable for damages
31
Buyer fails to pay price
seller is not bound to deliver
32
Delivery of Immovables
seller is to deliver the FULL EXTENT of the premises Liberative Prescription is 1 year from date of sale
33
Conforming Goods
seller must deliver conforming goods (agreed kind, quality, and quantity buyer has right to inspect, must reject nonconforming goods within a REASONABLE time
34
Buyer Accepts Nonconforming Goods
may not later reject them, UNLESS accepted them in reasonable belief that the nonconformity would be cured
35
Sellers Right to Cure Nonconformity
may cure if time for performance has not expired OR the seller reasonably believed the goods would be acceptable to the buyer
36
Warranty against Eviction
loss or danger of losing the whole or part of the thing sold because of third persons right that existed at time of sale
37
Scope of Warranty against eviction
loss of possession by virtue of judgment favoring 3p w/superior rights has not lost possession if can prove 3p has perfect title nonapparent conventional servitudes that have not been declared (not natural or legal nonapparent servitudes) Implied in every sale (can be modified) Covers rights existing at time of sale
38
Liability for Breach of Warranty Against Eviction
Warranty Sale - restitution of the price - restitution of fruits and revenues if buyer bound to return them to 3p - All costs by suits for warranty and/or eviction - Damages (excluding increase in value) IF buyer did NOT know danger of the eviction Sale w/o Warranty - restitution of price ONLY if buyer did not know the danger Sale at Buyer's Peril and Risk - NOTHING BACK
39
Warranty Sale
parties either do not address the matter of warranty or recite sale is a warranty sale
40
Sale Without Warranty
seller specifically renounces the warranty
41
Sale at Buyer's Peril and Risk
non-warranty sale with one of the following: 1. buyer was aware of the danger of eviction at time of sale 2. regardless of knowledge buyer declared buying at peril and risk; OR 3. Seller's obligation of returning the price has been EXPRESSLY excluded
42
Quitclaim Deed
not a sale of corporeal immovable but an assignment of right WITHOUT warranting the existence of such rights
43
Partial Eviction
buyer entitled to a proportionate reduction in price IF principal cause was to get the part evicted from buyer has option to cancel sale
44
Call in Warranty
if threatened with eviction BUYER MUST timely notify seller to defend the suit if buyer does not, loses rights under the warranty to extent seller could have successfully defended the action
45
Subrogation Rights (eviction)
buyer is subrogated to his seller's actions in warranty against all others (even if warranty excluded)
46
After-Acquired Title Doctrine
seller does not have title to the property being sold at the time of the sale, but later gains title will be a cure for seller's breach of warranty against eviction
47
Warranty Against Redhibition
protects buyer from redhibitory defects or vices
48
Elements of Redhibitory Defect
1. render the thing useless or so inconvenient that buyer would not have bought the thing had they known; OR 2. NOT render the thing totally useless, but diminish it usefulness or value so that buyer would have bought for a lesser price MUST NOT be apparent or discoverable at time of sale by a reasonably prudent buyer (buyer must inspect thing sold) MUST have existed at time of delivery (w/in 3 days presumed)
49
Effect of Breaching Warranty against Redhibition
if so useless or inconvenient would not have bought = rescission If value is diminished = reduction in price (quanti minoris)
50
BOP Redhibitory Defect
proving the thing had defect at delivery is on buyer NO requirement to prove cause of the defect
51
Not of Kind Specified or Lacking Qualities Seller Represents It Has
governed by general rules of contract IF seller INTENTIONALLY MISREPRESENTS buyer's rights are governed by redhibition
52
Liability of Seller for Redhibitory Defect (TOTALLY USELESS)
Good Faith Seller = restore purchase price and buyer's reasonable expenses for the sale Bad Faith Seller = must restore purchase price and buyer's expenses AND pay damages and attorney's fees
53
Liability of Seller for Redhibitory Defect (Lesser Defect)
Good Faith = Reduction in price; 1. Seller has opportunity to Repair before dissolution 2. Liberative Prescription: shorter of 1) 2 years from date of delivery 2) 1 year from date of discovery Bad Faith = Reduction in price; 1. NO opportunity to Repair 2. Liberation Prescription: 1 year from discovery of defect, OR 10 years from the date of perfection of the sale, whichever occurs first
54
Notice to Seller (redhibition)
MUST give notice Suffers diminution of warrant to extent failure made repair impossible or more burdensome NOT necessary when the seller has ACTUAL notice of the defect
55
Risk of Loss (Redhibition)
Buyer may seek rescission even after destruction IF it was due to redhibitory defect
56
Quanti Minoris (redhibition)
reduction of the price Buyer who seeks dissolution may be compelled to accept reduction of the price
57
Subrogation (redhibition)
buyer is subrogated to the seller's rights against ALL other's
58
Waivers of Warranty (redhibition)
must be in CLEAR and UNAMBIGUOUS TERMS and MUST be brought to the buyer's attention
59
Warranty of fitness for Ordinary Use
limited to the ordinary use of such things UNLESS: 1. Buyer has a particular use in mind 2. seller knows or should know the buyer's particular use 3. seller knows or should know buyer is RELYING on the seller's SKILL and JUDGMENT in selecting the thing
60
Liberative Prescription (Warranty for ordinary use)
shorter of: 1. 2 years from delivery 2. one year from daye buyer discovered the unfitness
61
Buyers Obligation
1. Take Delivery 2. Pay Price
62
Buyer's Breach of Duty to take delivery
liable to seller for damages and expenses incurred for preservation of the thing Seller is entitled to damages in amount of difference between contract price and market price on date of breach
63
Buyer's Breach of Duty to Pay Price
seller can choose between: 1. dissolving the sale 2. seeking enforcement of the sale (specific performance)
64
Seller's right of Resale (buyer breached sale)
seller has right to sell to 3p buyer responsible for any loss realized in the resale
65
Lesion Beyond Moiety
1. must be for a sale of a corporeal immovable 2. brought by vendor 3. lesion must be > 1/2 (price is less than one-half the value of the thing as of the time of the sale)
66
Effects of Lesion Beyond Moiety
Buyer given choice: 1. return the thing (get money back) 2. keep the thing and give seller money equal to FMV IF THING IS SOLD: Pay seller profit made on resale
67
Lesion Beyond Moiety Peremption
one year from date of sale
68
Sale with Right of Redemption
right to take thing back from the buyer CANNOT be reserved for more than 10 years if immovable and 5 years if movable Immovable = effective when the sale is recorded movable = effective against third persons with actual knowledge
69
Exchange
each party transfer ownership of a thing OTHER than money
70
Effect of an Exchange Contract
agreement transfers ownership NOT delievery
71
Eviction on Exchange
may demand value of the thing OR return the thing he gave May also seek damages
72
Lesion in Exchange
party giving a corporeal immovable in exchange for property worth less than 1/2 of FMV may claim rescission
73
Giving In Payment (Dation En Paiement)
debtor gives a thing to creditor as payment of a sum that is due perfected by DELIVERY
74
Contract to Build
Builder MUST build in a good and workmanlike manner
75
Distinguishing Contract to Build from a Sale
1. Buyer has SOME control over the specifications of the object 2. negotiations take place before the object is constructed 3. contract contemplates one party will supply the materials and also will furnish skill and labor to build the desired project
76
Rescission of Contract to Build
based on breach of warranty of workmanlike performance NOT redhibition
77
Contracts to "furnish and install"
similar to contracts to build sale subject to suspensive condition ownership and risk remain with seller if condition not fulfilled

LA BAR (25 decks)

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