Short answer. Generally, a verbal agreement is enough to create a valid sale. Article 1483 of the Civil Code allows a contract of sale to be made in writing, by word of mouth, partly in both, or even inferred from the conduct of the parties — subject to the Statute of Frauds and other applicable statutes.
What the law says
Subject to the provisions of the Statute of Frauds and of any other applicable statute, a contract of sale may be made in writing, or by word of mouth, or partly in writing and partly by word of mouth, or may be inferred from the conduct of the parties.
Civil Code, Article 1483 — Form of a Sale. Read the full provision →
The general rule: form is flexible
Article 1483 of the Civil Code establishes the general rule on form for contracts of sale: a contract of sale may be made in writing, or by word of mouth, or partly in writing and partly by word of mouth, or may be inferred from the conduct of the parties. Writing is one option, not a requirement. A verbal agreement to sell — if the essential elements are present — is a valid contract of sale. The law also recognizes that a sale can arise from conduct alone, without any words at all, where the parties' actions are consistent only with having agreed to a sale.
The important exception: the Statute of Frauds
Article 1483 is explicitly subject to the Statute of Frauds. The Statute of Frauds requires certain contracts to be in writing to be enforceable. For sales, this generally covers agreements for the sale of goods at a price of five hundred pesos or more, and sales of real property or an interest therein. A verbal sale of land is valid between the parties in the sense that it creates obligations, but it may be unenforceable in court if it is not in writing. The Statute of Frauds is an evidentiary rule — it does not make the contract void, but it prevents one party from compelling the other to perform if there is no written memorandum. The practical result is that verbal sales of covered items carry significant risk.
Sales inferred from conduct
Article 1483 expressly recognizes that a contract of sale may be inferred from the conduct of the parties. This is an important provision for situations where nothing was said or written but the parties behaved in a way that is only explicable on the basis that a sale was agreed. Delivery of goods, payment of a price, and taking possession without protest are examples of conduct from which a sale may be inferred. The question in those cases is whether the conduct of both parties, viewed together, establishes that there was a meeting of minds on the object and the price — the two essential elements of any sale.
Practical implications of a verbal sale
Even when a verbal sale is valid, it carries practical disadvantages. Without a written record, the terms of the agreement — what was sold, for how much, and on what conditions — are easier to dispute. For sales of land, registration is not possible without a notarized deed, and registration determines priority against third parties. A buyer who has only a verbal agreement cannot register the sale and risks being displaced by a later buyer who has a registered title. For movables with low value, a verbal or informal sale presents fewer risks. For anything of significant value, especially real property, reducing the agreement to writing and having it properly executed is worth doing even when the law does not strictly require it.
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.
- Lorenzo Willy, substituted by his heirs, namely: Felicidad D. Willy, Betty Willy Cadangen, Tony, G.R. No. 207051, December 1, 2021 — read the decision on LawPhil →
- Province of Cebu vs. Heirs of Rufina Morales, et al, G.R. No. 170115, February 19, 2008 — read the decision on LawPhil →