RECTO-LAW (1).pdf

RFLIB RECTO LAW REGULATORY FRAMEWORK AND LEGAL ISSUE IN BUSINESS GROUP 1 2024 RECTO LAW The Recto Law, formally known as Act 4122, was enacted in the Philippines in 1933 to protect buyers of personal property on installment basis. Its primary rationale is to establish a balance betw...

RFLIB RECTO LAW REGULATORY FRAMEWORK AND LEGAL ISSUE IN BUSINESS GROUP 1 2024 RECTO LAW The Recto Law, formally known as Act 4122, was enacted in the Philippines in 1933 to protect buyers of personal property on installment basis. Its primary rationale is to establish a balance between the rights of sellers and buyers, preventing sellers from taking unfair advantage of buyers in installment sales contracts. Protection of Fairness and Prevention of Buyers Equity Abuse Recto Law Purpose of Recto Law To address the imbalance of power between sellers and buyers To prevent sellers from taking advantage of buyers To promote fair and equitable business practices Recto Law  Buyers of personal property on installment Persons basis. (It doesn't cover real estate.) covered by the Recto Law: Individuals or entities who enter into installment sales contracts for personal property  RECTO LAW Examples of 01. Purchase of a car on installment transactions 02. Purchase of household appliances covered by on installments the Recto 03. Purchase of furniture on a Law: monthly payment plan Recto Law Remedies available to sellers in RFLIB case of default: EXACT RESCIND OR FORECLOSE FULFILLMENT OF CANCEL THE THE CHATTEL THE OBLIGATION SALE MORTGAGE The seller can demand If a chattel The seller can cancel that the buyer pay the mortgage has been the contract and remaining balance of executed, the seller recover the property. the purchase price. can foreclose on it. Recto Law Penalties for Violations DAMAGES SPECIFIC PERFORMANCE RESCISSION OF CONTRACT INJUNCTION ADMINISTRATIVE SANCTIONS  RFLIB THANK YOU!!