Short answer. It can be valid. Under Article 1461, things with a potential existence may be sold, and the sale of a mere hope or expectancy holds — but only subject to the thing actually coming into existence. What the law refuses to enforce is the sale of a vain hope or expectancy, which it declares void.
What the law says
Things having a potential existence may be the object of the contract of sale.
Civil Code, Article 1461 — Sale of Things With Potential Existence. Read the full provision →
What the law says
The sale of a vain hope or expectancy is void.
Civil Code, Article 1461 — Sale of Things With Potential Existence. Read the full provision →
Selling something not yet in existence
Everyday commerce often sells things that do not fully exist yet — next season's harvest, the young of an animal, output a machine will produce. Article 1461 accommodates this by providing that things having a potential existence may be the object of the contract of sale. The thing need not be in hand at the moment of sale, as long as it can come into being in the ordinary course. So a farmer may sell a crop still in the ground and a fisher the expected catch. The buyer is not buying thin air; he is buying a thing the law recognises as capable of existing, and the sale is treated as real.
A hope of a thing versus the thing itself
The article then distinguishes two ways such a deal can be structured. In one, the sale of the expected thing is deemed subject to the condition that the thing will come into existence. Here the buyer pays for the thing, and if it never materialises there is nothing to pay for. In the other, the buyer knowingly buys the hope itself — the chance — and agrees to pay whether or not the thing turns up. This second kind, the sale of a hope, is valid: the buyer has taken the gamble with open eyes, and the price buys the chance, not a guaranteed object.
When the sale becomes void
The line the law will not cross is the last sentence: The sale of a vain hope or expectancy is void. A hope is vain when there was never any real possibility that the thing could come into existence — the chance was empty from the start. Selling a ticket to a lottery that had already been drawn, or the young of an animal that could not breed, is selling nothing. Because the object is impossible, the contract has no real subject matter and the law strikes it down entirely. A void sale produces no obligations, and money paid on it can be recovered.
Why the distinction matters to you
The practical question in a dispute is which of these you actually agreed to. If you bought the thing subject to its coming into existence and it failed to appear, you generally owe nothing. If you bought the hope, you may owe the price even on a disappointing result, because you paid for the chance. And if the whole thing was a vain hope, neither side is bound and payments unwind. Article 1461 does not excuse a bad bargain or a real risk you knowingly took; it only refuses to enforce a sale of a possibility that never existed. Reading the deal correctly at the outset avoids paying for nothing.
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.
- Spouses Mariano P. Marasigan and Josefina Leal vs. Chevron Phils., Inc., et al, G.R. No. 184015, February 8, 2012 — read the decision on LawPhil →
- Fidela Mananzala vs. Court of Appeals, et al, G.R. No. 115101, March 2, 1998 — read the decision on LawPhil →