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1) set forth the terms of warranty in clear and readily understandable language and clearly identify himself as the
warrantor;
4) state what the warrantor will do in the event of a defect, malfunction of failure to conform to the written warranty and
at whose expense;
5) state what the consumer must do to avail of the rights which accrue to the warranty; and
6) stipulate the period within which, after notice of defect, malfunction or failure to conform to the warranty, the
warrantor will perform any obligation under the warranty.
b) Express warranty operative from moment of sale. All written warranties or guarantees issued by a manufacturer, producer,
or importer shall be operative from the moment of sale.
1) Sales Report. All sales made by distributors of products covered by this Article shall be reported to the manufacturer,
producer, or importer of the product sold within thirty (30) days from date of purchase, unless otherwise agreed upon.
The report shall contain, among others, the date of purchase, model of the product bought, its serial number, name and
address of the buyer. The report made in accordance with this provision shall be equivalent to a warranty registration
with the manufacturer, producer, or importer. Such registration is sufficient to hold the manufacturer, producer, or
importer liable, in appropriate cases, under its warranty.
2) Failure to make or send report. Failure of the distributor to make the report or send them the form required by the
manufacturer, producer, or importer shall relieve the latter of its liability under the warranty: Provided, however, That
the distributor who failed to comply with its obligation to send the sales reports shall be personally liable under the
warranty. For this purpose, the manufacturer shall be obligated to make good the warranty at the expense of the
distributor.
3) Retail. The retailer shall be subsidiarily liable under the warranty in case of failure of both the manufacturer and
distributor to honor the warranty. In such case, the retailer shall shoulder the expenses and costs necessary to honor the
warranty. Nothing therein shall prevent the retailer from proceeding against the distributor or manufacturer.
4) Enforcement of warranty or guarantee. The warranty rights can be enforced by presentment of a claim. To this end,
the purchaser needs only to present to the immediate seller either the warranty card of the official receipt along with the
product to be serviced or returned to the immediate seller. No other documentary requirement shall be demanded from
the purchaser. If the immediate seller is the manufacturer's factory or showroom, the warranty shall immediately be
honored. If the product was purchased from a distributor, the distributor shall likewise immediately honor the warranty.
In the case of a retailer other than the distributor, the former shall take responsibility without cost to the buyer of
presenting the warranty claim to the distributor in the consumer's behalf.
5) Record of purchases. Distributors and retailers covered by this Article shall keep a record of all purchases covered by
a warranty or guarantee for such period of time corresponding to the lifetime of the product's respective warranties or
guarantees.
6) Contrary stipulations null and void. All covenants, stipulations or agreements contrary to the provisions of this
Article shall be without legal effect.
c) Designation of warranties. A written warranty shall clearly and conspicuously designate such warranty as:
1) "Full warranty" if the written warranty meets the minimum requirements set forth in paragraph (d); or
2) "Limited warranty" if the written warranty does not meet such minimum requirements.
d) Minimum standards for warranties. For the warrantor of a consumer product to meet the minimum standards for warranty, he
shall:
1) remedy such consumer product within a reasonable time and without charge in case of a defect, malfunction or failure
to conform to such written warranty;
2) permit the consumer to elect whether to ask for a refund or replacement without charge of such product or part, as the
case may be, where after reasonable number of attempts to remedy the defect or malfunction, the product continues to
have the defect or to malfunction.
The warrantor will not be required to perform the above duties if he can show that the defect, malfunction or failure to conform to
a written warranty was caused by damage due to unreasonable use thereof.
e) Duration of warranty. The seller and the consumer may stipulate the period within which the express warranty shall be
enforceable. If the implied warranty on merchantability accompanies an express warranty, both will be of equal duration.
Any other implied warranty shall endure not less than sixty (60) days nor more than one (1) year following the sale of new
consumer products.
17
Sales Finals Reviewer
Prof. J. Sanchez
1 semester, AY 10-11
st
2) In case of breach of implied warranty, the consumer may retain in the goods and recover damages, or reject the goods,
cancel and contract and recover from the seller so much of the purchase price as has been paid, including damages.
EMC v. CA.
Castle v. Gutierrez. The plaintiffs entered into a contract with the defendants by virtue of which the latter agreed to
furnish the former 500 bales of hemp. The plaintiffs testified that defendants' agent agreed to purchase and to furnish
hemp which should grade "good current Manila." The hemp delivered did not equal "good current." Plaintiffs demanded
that suitable hemp be furnished, and, upon refusal, they purchased in the open market 299 bales at an advance of P4.50
per picul: Held, That the evidence is sufficient to establish the contract as alleged by the plaintiffs, and that they are
entitled to recover their loss of P2,691 caused by defendants' failure to comply with the agreement.
Pacific Comm v. Ermita. Plaintiff contracted to sell to defendant an automatic refrigerating machine as per description
stated in the sales contract. The machine was delivered and by mutual agreement the vendor installed the machine. The
machine did not give the results expected from it, and the defendant refused to pay the balance of its purchase price and
the cost of the installation of the machine. Thereupon plaintiff brought this action. Held: The fact that the defendant could
not use the machine satisfactorily in the three cold stores divisions cannot be attributed to plaintiff's fault; the machine
was strictly in accordance with the written contract between the parties, and the defendant can hardly honestly say that
there was any deception by the plaintiff.
Nutrimix Feeds Corp v. CA. A hidden defect is one which is unknown or could not have been known to the vendee. Under
the law, the requisites to recover on account of hidden defects are as follows: (a) the defect must be hidden; (b) the defect
must exist at the time the sale was made; (c) the defect must ordinarily have been excluded from the contract; (d) the
defect, must be important (renders thing UNFIT or considerably decreases FITNESS); (e) the action must be instituted
within the statute of limitations. || In the sale of animal feeds, there is an implied warranty that it is reasonably fit and
suitable to be used for the purpose which both parties contemplated. To be able to prove liability on the basis of breach of
implied warranty, three things must be established by the respondents. The first is that they sustained injury because of
the product; the second is that the injury occurred because the product was defective or unreasonably unsafe; and finally,
the defect existed when the product left the hands of the petitioner. A manufacturer or seller of a product cannot be held
liable for any damage allegedly caused by the product in the absence of any proof that the product in question was
defective. The defect must be present upon the delivery or manufacture of the product; or when the product left the
seller's or manufacturer's control; or when the product was sold to the purchaser; or the product must have reached the
user or consumer without substantial change in the condition it was sold. Tracing the defect to the petitioner requires
some evidence that there was no tampering with, or changing of the animal feeds. The nature of the animal feeds makes it
necessarily difficult for the respondents to prove that the defect was existing when the product left the premises of the
petitioner.
IV. Obligations of the Vendee/Buyer
A. Obligation to accept delivery
CC, 1524. The vendor shall not be bound to deliver the thing sold, if the vendee has not paid him the price, or if no period for the
payment has been fixed in the contract.
CC, 1169. Those obliged to deliver or to do something incur in delay from the time the obligee judicially or extrajudicially demands
from them the fulfillment of their obligation. However, the demand by the creditor shall not be necessary in order that delay may
exist: (1) When the obligation or the law expressly so declare; or (2) When from the nature and the circumstances of the obligation
it appears that the designation of the time when the thing is to be delivered or the service is to be rendered was a controlling
motive for the establishment of the contract; or (3) When demand would be useless, as when the obligor has rendered it beyond his
power to perform.
In reciprocal obligations, neither party incurs in delay if the other does not comply or is not ready to comply in a proper
manner with what is incumbent upon him. From the moment one of the parties fulfills his obligation, delay by the other begins.
CC, 1521. Whether it is for the buyer to take possession of the goods or of the seller to send them to the buyer is a question
depending in each case on the contract, express or implied, between the parties. Apart from any such contract, express or implied,
or usage of trade to the contrary, the place of delivery is the seller's place of business if he has one, and if not his residence; but in
case of a contract of sale of specific goods, which to the knowledge of the parties when the contract or the sale was made were in
some other place, then that place is the place of delivery.
Where by a contract of sale the seller is bound to send the goods to the buyer, but no time for sending them is fixed, the seller is
bound to send them within a reasonable time.
Where the goods at the time of sale are in the possession of a third person, the seller has not fulfilled his obligation to deliver to the
buyer unless and until such third person acknowledges to the buyer that he holds the goods on the buyer's behalf.
Demand or tender of delivery may be treated as ineffectual unless made at a reasonable hour. What is a reasonable hour is a
question of fact.
Unless otherwise agreed, the expenses of and incidental to putting the goods into a deliverable state must be borne by the seller.
CC, 1536. The vendor is not bound to deliver the thing sold in case the vendee should lose the right to make use of the terms as
provided in Article 1198.
18
Sales Finals Reviewer
Prof. J. Sanchez
1 semester, AY 10-11
st