Short answer. Payment is due at the time and place of delivery. Article 1582 of the Civil Code provides that when a contract of sale is silent on when and where to pay, the buyer must pay at the same time and place that the seller delivers the goods or property.
What the law says
If the time and place should not have been stipulated, the payment must be made at the time and place of the delivery of the thing sold.
Civil Code, Article 1582 — Obligations of the Vendee (Accept and Pay). Read the full provision →
The rule when the contract is silent
Article 1582 of the Civil Code sets out the buyer's core obligations: accept delivery and pay the price. When the contract specifies a time and place for payment, those terms govern. When it is silent — as in your case — the law supplies the default: payment must be made at the time and place of the delivery of the thing sold. Delivery and payment happen simultaneously, at the same location. The buyer cannot insist on paying later or somewhere else without the seller's agreement.
Why this rule is structured around delivery
Tying payment to delivery reflects the bilateral nature of a sale: the seller transfers the thing, the buyer pays the price. These are reciprocal obligations, and the default rule ensures they are performed at the same time rather than sequentially. A seller who delivers first and expects payment later takes on a credit risk. A buyer who pays first and waits for delivery takes on a counter-party risk. By making delivery and payment simultaneous in the absence of any other agreement, Article 1582 balances both parties' positions without favoring either.
What counts as the place and time of delivery
Determining the place and time of delivery depends on the nature of what was sold and any custom or usage in the trade. For physical goods, delivery typically occurs when the seller physically hands over the item or places it at the buyer's disposal. For real property, delivery may occur at the location of the land or upon execution of the relevant document. Whatever moment and location constitutes delivery under the circumstances of your sale is the moment and location at which payment falls due.
When a dispute arises over timing
If the seller has tendered delivery and the buyer has not paid, or the buyer has offered to pay but the seller has not yet delivered, the situation depends on who was ready and who was not. A seller who has delivered and not been paid may treat the buyer as in default. A buyer who tendered payment at delivery but was refused may have their own remedies. If neither party was ready at the proper time and place, the analysis becomes more complex. A lawyer can help clarify whether a default has occurred and what remedies are available.
Cases citing this provision
These Supreme Court decisions cite the provision above. We list them so you can read them yourself; the summaries of what each decided are not ours to give.
- Tomas K. Chua vs. Court of Appeals, et al, G.R. No. 119255, April 9, 2003 — read the decision on LawPhil →
- ACE Foods, Inc. vs. Micro Pacific Technologies Co., Ltd, G.R. No. 200602, December 11, 2013 — read the decision on LawPhil →
- D.M. Wenceslao and Associates Inc., et al. vs. Readycon Trading Construction Corp, G.R. No. 154106, June 29, 2004 — read the decision on LawPhil →