Explanation of Article 350
The article addresses a specific form of consensual rescission, where the rescission does not depend on notifying the debtor or obtaining a court ruling. It involves setting a specific date for the payment of the price, with the seller stipulating that if the buyer does not pay the price by the specified date, there is no sale between them, i.e., between the seller and the buyer. Once agreed upon in this manner with this phrase or its equivalent, it is considered an agreement between them that the seller can consider the sale rescinded without needing to notify the buyer or request rescission through the courts. The phrase "there is no sale between them" and its equivalents are deemed an explicit agreement that rescission occurs upon the fulfillment of the resolutory condition without requiring notification or a court ruling.
If the buyer is obstinate and disputes the enforcement of the condition, the seller may have no choice but to file a lawsuit for rescission. However, in this case, the court's ruling would reveal the rescission rather than create it; the court cannot grant the buyer an extension to pay the price, and the buyer cannot prevent rescission by depositing the price with the court.
The specified date for payment may be determined by an explicit agreement, which is common in such transactions, or it may be implicit, such as when custom dictates a specific date for payment and delivery of the goods. However, the resolutory condition must be explicit in indicating that rescission occurs upon the fulfillment of the condition without the need for notification, as stated in the article and its equivalents.
It is clear from the article that considering the contract rescinded is at the seller's discretion, as the article ties rescission to the seller's choice, whether the seller has delivered the goods to the buyer or required payment for delivery. The seller may consider the contract not rescinded and demand payment from the buyer, as the condition benefits the seller, who may waive it. The buyer, however, cannot consider the contract rescinded if the seller does not choose to do so, as the breach originated from the buyer; otherwise, the buyer could rescind the contract at will by refusing to pay the price.
The article does not address the seller's breach of obligation, as it follows general rules. If the seller considers the contract not rescinded because the buyer paid the price on time, or did not pay and the seller did not consider it rescinded, and the seller breaches, the buyer may request rescission. However, this would be judicial rescission, with the court's ruling creating rather than revealing it. The court may, at its discretion, grant the seller time to fulfill the obligation or reject the rescission request if the seller's breach is minor relative to the overall obligation.
It is important to note that the condition in the article is a resolutory condition benefiting the seller. However, if the agreement indicates that the sale is contingent upon a suspensive condition, which is the buyer's payment of the price, and if the buyer does not pay, there is no sale between them; the buyer's obligation to pay the price does not exist in this case, as it depends solely on the buyer's will. This condition, although contingent on the debtor's sole will, is valid because it is in a bilateral contract; failure to pay the price results in the buyer losing the corresponding obligation, which is ownership of the goods. Once the price is paid, the contract is considered effective, and the condition in this scenario follows the rules of a suspensive condition, which is outside the scope of the condition mentioned in this article.
Related To
Article 350
If a deadline for payment is set in the sale contract and the seller stipulates that the sale will be terminated if no payment is made by said deadline and the buyer fails to meet the deadline, the sale shall be deemed terminated if the seller so elects without the need for notification, unless agreed otherwise.