Explanation of Article 333
The article clarifies that if the buyer averts a claim for the entitlement of the sold item, in whole or in part, by settling with the claimant for compensation, whether before or after the lawsuit is filed and before the judicial ruling is issued, and the buyer has the right to revert to the seller for indemnity; if the seller does not prove that the claimant was not justified in their claim, then the seller can relieve themselves of the indemnity obligation by refunding the buyer an amount equivalent to the settlement compensation and its expenses.
The term "settlement compensation" refers to the money with which the buyer settles with the claimant in exchange for the claimant dropping their claim. If the settlement compensation is in cash, the seller refunds the buyer the amount of cash paid and the settlement expenses. If the settlement compensation is something other than cash, the seller refunds the value of that item and the settlement expenses.
The seller's relief from the indemnity obligation in this manner is subject to their choice of what is more beneficial for them by choosing the lesser of the two between the settlement compensation and its expenses or the entitlement indemnity. If the settlement compensation and its expenses are less, the seller is only obligated to that, and the buyer cannot demand full indemnity; because compensating the buyer for the damage caused by the entitlement is achieved by paying the settlement compensation and its expenses; the buyer retains the sold item and recovers their loss, and if more than that is demanded, it would be receiving something not entitled to them, resulting in unjust enrichment. If the entitlement indemnity is less, the seller is only obligated to that; because the seller's obligation under the sales contract is limited to the entitlement indemnity, no more; if the buyer incurs more in their settlement, the seller is not obligated, and this situation may occur if the buyer wishes to retain the sold item and not have it taken by the claimant, so they settle for an amount exceeding the entitlement indemnity they have the right to revert to the seller for.
The article indicates that if a judgment is issued for the entitlement of the sold item, and then the buyer agrees with the entitled party to retain the sold item in exchange for compensation through sale, barter, or otherwise, this agreement does not affect the seller's obligation for the entitlement indemnity; the buyer can revert to the seller for indemnity even if it exceeds that compensation, because the entitlement indemnity is established by the issuance of the judgment.
Related To
Article 333
If a buyer makes a financial settlement with the party claiming ownership of the sold item before a court judgment is issued in his favor, the seller may be released from the warranty by reimbursing the buyer an amount equal to the settlement amount and expenses.