Carbonell vs. Court of Appeals, and Poncio 69 SCRA 99

By Lynielle Crisologo

A contract of sale is a legal contact. It is a contract for the exchange of goods, services or property that are the subject of exchange from seller (or vendor) to buyer (or purchaser) for an agreed upon value in money (or money equivalent) paid or the promise to pay same. It is a specific type of legal contract.

In Article 1403 it is deemed unenforceable if the qualification such as statute of fraud is not complied and that includes contract of sales such as buying or selling goods. An agreement for the sale of goods, chattels or things in action, at a price not less than five hundred pesos, unless the buyer accept and receive part of such goods and chattels, or the evidences, or some of them, of such things in action, or pay at the time some part of the purchase money; but when a sale is made by auction and entry is made by the auctioneer in his sales book, at the time of the sale, of the amount and kind of property sold, terms of sale, price, names of the purchasers and person on whose account the sale is made, it is a sufficient memorandum;” 

CARBONELL V PONCIO further explained the general rule relating to the Statute of Frauds being a cautious qualification to the general rule that contracts, no matter in what form they are entered into, are valid and enforceable. (Vide Arts. 1315 and 1356). As in Article 1403 contracts can be deemed unenforceable if this said qualification is not complied with. It is for the the purpose quite obviously, to prevent, and not to promote fraud. It is well settled in Great Britain and in this country, with the exception of a few states, that a sufficient part performance by the purchaser under a parol contract for the sale of real estate removes the contract from the operation of the statute of frauds. (49 Am. Jur., 722-723.)’” 

“In the words of former Chief Justice Morán: ‘The reason is simple. In executory contracts there is a wide field for fraud because unless they be in writing there is no palpable evidence of the intention of the contracting parties. The statute has precisely been enacted to prevent fraud.’ (Comments on the Rules of Court, by Morán, Vol. III [1957 ed.], p. 178.) However, if a contract has been totally or partially performed, the exclusion of parol evidence would promote fraud or bad faith, for it would enable the defendant to keep the benefits already derived by him from the transaction in litigation, and, at the same time, evade the obligations, responsibilities or liabilities assumed or contracted by him thereby.”