Question & AnswerQ&A (Acts No. 4122)
The main purpose of Acts No. 4122 is to amend the Civil Code by inserting Section 1454-A, which regulates contracts for the sale of personal property payable in installments, including provisions on the vendor's right to cancel the sale or foreclose the mortgage upon failure to pay installments.
The vendor has the right to cancel the sale or foreclose the mortgage on the property without reimbursement to the purchaser of the installments already paid, provided there is an agreement to this effect.
No, the vendor is not required to reimburse the purchaser for the installments already paid if the sale is canceled due to failure to pay two or more installments, as long as there is an agreement to this effect in the contract.
If the vendor chooses to foreclose the mortgage, the vendor has no further action against the purchaser for recovering any unpaid balance, and any agreement stating otherwise is null and void.
No, the vendor cannot demand additional payments from the purchaser after foreclosure because such claims are prohibited, and agreements to collect unpaid balances after foreclosure are null and void.
Yes, the same rules apply to leases of personal property with an option to purchase when the lessor has chosen to deprive the lessee of the enjoyment of the property due to failure in payment.
There must be a failure to pay two or more installments and an agreement in the contract granting the vendor the right to cancel the sale or foreclose the mortgage under such circumstances.
The Act takes effect upon its approval as stated in Section 2 of the law.
The insertion of Section 1454-A provides specific provisions governing installment sales of personal property, clarifying vendor and purchaser rights and obligations, especially in cases of default.
Yes, the law specifies that the vendor's right to cancel the sale or foreclose the mortgage must be based on an agreement to that effect in the contract.