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SALES c.

Yes, it is sufficient that he be the


owner at the time he is to deliver the
object.
1. Which of the following is not a d. Yes, it is valid until annulled.
characteristic of sale?
a. Bilateral 9. Which of the following may not be object
b. Gratuitous of a contract of sale?
c. Consensual a. Things having potential existence.
d. Nominate b. The sale of vain hope or expectancy.
c. Future goods.
2. A characteristic of a Contract of Sale d. Answers not given
which involves exchange of value
a. Commutative 10. There is not be a valid object of sale
b. Nominate a. Future wool that shall grow upon a
c. Bilateral sheep.
d. Consensual b. Sale of human flesh for human
pleasure.
3. Dacion en Pago as distinguished from sale c. The entire rental next month in a 4-
a. The object is always existing and door apartment.
specific. d. Sale of a lotto ticket that will be
b. There is greater freedom in fixing the drawn next week.
price.
c. There is no pre-existing obligation. 11. If the seller is not the owner, the sale
d. The cause is the price. is null and void. Which is not an
exception?
4. Sale is distinguished from dation in a. When the sale of the goods is by his
payment in that is a sale: conduct precluded from denying the
a. There is a pre-existing obligation or seller’s authority.
credit. b. Where the goods were sold in a
b. The cause is a price. merchant’s store, or in fairs, or
c. It is a mode of existing an obligation markets.
in the form of payment. c. When the seller subsequently acquires
d. Answer is not given. title.
d. When the buyer acquires the property
5. Ababao and Bancaso entered into a “ without knowledge of the bad faith of
Contract to sell “ in private writing the seller.
involving a specific parcel of land worth
P2M. Bancaso paid 50% of the purchase 12. Mr. Marcial Bonifacio orders of his
price, balance payable in 3 years. Ababao workers 1,000 pieces of t-shirts ranging
delivered the land to Bancaso. What is in size from small to large from the
the effect of the delivery of tha land Magellan Garments Mfg. Corp. The
to bancaso? specified sizes, although not then
a. Bancaso is the owner because there was available, are manufactured by said
delivery already. corporation and consigned to it sales
b. Bancaso can compel Ababao to execute outlets regularly. The contract entered
a deed of sale in public instrument. into by Mr. Bonifacio with the Magellan
c. The partial payment made Bancaso the Garments Mfg, Corp is an
owner of the land. a. Contract for a piece of work.
d. Ababao is still the owner because the b. Contract subject to resolutory
price is not yet totally paid. condition.
c. A contract of sale.
6. Which is an exception? A sale is a d. Answers not given.
contract where one of the contracting
parties, called the seller (or vendor), 13. Aldaba delivers to Baduria a photocopying
Obligates himself: machine worth P 50,000 and cash amounting
a. The transfer ownership of the object. to P 50,000. The contract is a –
b. The deliver a determinate thing. a. Sale
c. To warrant against eviction and b. Barter
hidden defects. c. Partly barter and partly sale
d. To pay therefor a price certain in d. Innominate
money or its equivalent.
14. Abion sold the Bagamasbad a piece of
7. Mimmodto entered the Sugbo Restaurant and jewelry at a price of P 20,000. The
ordered a dozen fresh oyster in their contract provides that the Bagamasbad
shell. While eating, Mimmodto noticed an will give the Abion a microwave oven
almost perfect pearl in one of the worth P 5,000. What is the nature of the
shells. He is about to take it when contract?
Maliksi, the restaurant owner, claims the a. Sale
pearl. To whom does the pearl belong? b. Partly sale partly barter
a. To Mimmodto because the contract of c. Barter
sale was already perfected. d. Commodatum
b. To Maliksi, because Mimodto has not
yet paid the food he ordered. 15. Connie transferred to Violeta a parcel of
c. To the state because the pearl is land for a price of P 100,000; P 30,000
considered as a national treasure. to be paid in cash and for the
d. To both Mimdoto and Maliksi, each of difference, she will convey her car worth
them being entitled to half of its P 70,000. What kind of contract is this?
price. a. Lease contract
b. Contract of sale
8. Silva sold to Bien a land, which os owned c. Obligation of sale
by Canuto. Is the sale valid? d. Barter
a. No, because Silva does nt have the
right to sells things which he does
not own. 16. Shaolo and to Balo his land worth P
b. No, he should first acquire the title 2,000,000 for P 1,500,000 only, thus
legally from Canuto before he can sell resulting to inadequate price. The sale
it to Bien. is:
a. Rescissible
b. Voidable seller is obligated to transfer
c. Unenforceable ownership of the things sold.
d. Void b. The seller need not be the owner of
the thing sold at the perfection of
17. Sawana offered his car to Bacopa with the sale.
understanding that the price shall be at c. There may be a transfer of ownership
the descrition of Bacopa. As agreed upon, over the thing even if the seller has
Bacopa fixed the price at P 350,000 not actually delivered the thing sold
although its fair market value was P to the buyer.
250,000 only. It is clear therefore that d. In a contract of sale the buyer
the price fixed is beneficial to Sawana. becomes the owner of the thing sold
Before acceptance of the price by Sawana, upon full payment of the purchase
is there already a sale? price.
a. No perfected sale as there was no
consent on the price. 23. Secillo offered to sell to Buensalida his
b. There was a perfected sale, the amount 5-door apartment house in Cubao, Quezon
was already fixed by the buyer and City for P 3 Million. Buensalida agreed
will surely be accepted by the seller. to buy but requested to give him 20 days
c. Yes because the fixing of the price to raise the money. After two weeks,
by Bacopa is properly authorized by Buensalida informed Secillo that he has
Sawana. raised the money. However, Buensalida
d. Yes but it is voidable due to mistake informed him the he is no longer
committed by Bacopa in the fixing of interested to sell the property. Can
the price. Buensalida compel Secillo to sell the
property.
18. Solera sold and delivered her diamond a. Yes, because there was a mutual
ring to Ballesteros. It was agreed upon promise to buy and sell a determinate
that within 10 days Ballesteros will thing.
state and fix the price. On the 10th day, b. Yes, because Buensalida was able to
Ballesteros called upon by telephone raise money within the agreed period.
Solera and stated the price at P 20,000 c. No, because the contract of sale has
while Solera agreed. Is the sale not yet been perfected.
perfected? d. No, because there was only an accepted
a. No, at the time of sale the price was unilateral promise to sell.
not fixed.
b. Yes, at the time of the sale the price 24. Singalong sold his land to Barganza for
was already known. P 500,000, who paid SIngalong the price
c. Yes, the price as stated and fixed by in fake 500 pieces of P 1,000 bill. What
the buyer was accepted by the seller. is the status of the contract of sale?
d. No, the price was left to the a. Voide because the consideration is
discretion of one of the parties. fake.
b. Voidable because of the presence of
19. Sotto sells to Buena his 1988 Cougar car, consideration except that it is fake.
and leaves Buena to determine the price. c. Void because the cause is false.
Buena refuses to fix the price but took d. Valid because it has a consideration
the car for his use. Which of the although it is fake.
following statements is correct?
a. No sale because the price is not fixed 25. Barayoga sold his motorcycle to Narcisa.
by the parties. No date was fixed for the performance of
b. There is a sale, Buena must pay a their respective obligations. The
reasonable price. obligation of Barayoga is:
c. No sale until a third person fixed the a. To wait for Narcisa to pay the price
price. before he delivers the motorcycle.
d. Sotto may go to a court and ask for b. To deliver the motorcycle after
damages. Narcisa demands delivery.
c. To rescind the contract because the
20. A case where a contract of sale must not time of performance is not fixed.
necessarily be in writing d. To deliver the motorcycle as soon as
a. Sale of 100 piculs of sugar at P 400 possible because the sale has been
per picul when there is partial purchased.
delivery.
b. Sale where by its term cannot be 26. Which of the following obligations of the
performed within one year from the vendor cannot be waived?
making thereof. a. To allow the buyer to examine the
c. Sale of land. goods sold.
d. Sale of public auction. b. To transfer the ownership to the
buyer.
21. Which is not correct? In a sale by c. To pay the expenses of the deed of
auction sale.
a. The auctioneer may withdraw the goods d. To warrant the thing sold.
before the hammer falls whether or not
the auction has been announced to be 27. Halk, a taekwando champion, with the
without recourse. intimidation forced his wife Matatakutin
b. The sale is perfected when auctioneer to sell to him Matatakutin’s properties
announces its perfection by the fall worth P 300,000. The sale is
of the hammer. a. Unenforceable, unless the sale was
c. The seller may bid provided such right made in writing.
was reserved and noticed was given to b. Voidable, because the consent of
the other bidders. MAtatakutin is vitiated.
d. Every bidding is merely an offer, and c. Rescissible, if Matatakutin suffered
therefore before is it accepted, it a lesion of more than ¼ of the value
may be withdrawn, of the property.
d. Void, except when the separation of
22. Which of the following statement is property was agreed upon in the
incorrect? marriage settlement or there has been
a. In a contract of sale the full payment a judicial separation of property.
of the price is in the nature of
suspensive condition in that the
28. Which of the following is considered s an absolute deed of sale was executed and
actual delivery? notarized. On January 20, the sale was
a. Execution and signing of the deed of registered with the Land Transportation
sale. Office (LTO). On January 25, bayer took
b. Delivery by the vendor of the key of actual possession of the car. When did
the warehouse where the goods are Bayer acquire title of the car?
stored. a. On January 10
c. Placing the title of the ownership in b. On January 15
the hands of the buyer. c. On January 20
d. The goods sold are placed in the d. On January 25
control and possession of the vendee.
37. On January 7, 2008, Ariel sells and
29. Which of the following is not delivers to Barabara his car for P
constructive delivery in sale? 200,000 on a “ sale or return within 10
a. Tradition brevi manu days “ after delivery. On January 15,
b. Tradition constitutum possessorium 2008, the car was lost through a
c. Thing is place in the control and fortuitous event. Who bears the loss?
possession of buyer. a. Ariel under the principle of “ res
d. Execution of public document. perit domino “
b. Barabara and she must pay the purchase
30. Lucky is a lessee of a store in a shopping price.
mall. She orally sells/ assigns his right c. Both Ariel and Barabara jointly.
to Samonte. She then allows Samonte to d. Neither of them because the loss was
occupy the staff. The delivery here is due to a fortuitous event.
called
a. Quasi-traditio 38. Salvora delivered a computer set Perper
b. Actual delivery “ on approval, on trial ot no
c. Tradition longa manu satisfaction “ the ownership passes to
d. Tradition brevi manu Perper upon
a. Delivery of the things.
31. When the delivery takes place by the mere b. Meeting of the minds
consent of contracting parties as when c. Conception of the sale
the vendor merely points to the thing d. The return of the things to Salvora.
sold which shall thereafter be at the
control and disposal of the vendee if the 39. Statement 2: in a sale on return,
thing sold cannot be transferred to the ownership passes to the vendee upon the
possession of the vendee at the time of delivery of the goods; in sale or trial,
sale, delivery is effected: ownership does not pass to the buyer
a. By tradition symbolica until he accepts the goods.
b. By tradition longa manu
c. By tradition brevi manu Statement 1: in sale or return, the risk
d. Answers not given of the loss is on the vendor; in sale or
trial, the risk of loss is on the vendee
32. Alay-ay sold his house to Bibingka but
continued to posses it as a lessee of the a. Both statements are true
purchaser. b. Statement 1 is true, statement 2 is
a. Traditio longa manu false
b. Quasi-traditio c. Both statement is false
c. Tradition constitutum possessorium d. Statement 1 is false, statement 2 is
d. Tradition brevi manu true

33. Which of the following options is not 40. The Recto Law is applicable on:
correct? If Selerio delivered to Bayeran a. Sale of car on a straight term
a television “ on sale or return “ b. Sale of house on instalment were the
a. The ownership is transferred to buyer constituted mortgage on the
Bayeran upon actual delivery. house.
b. Bayeran can return the goods even if c. Sale of car on instalment were the
he finds nothing wrong with its buyer constituted a mortgage on his
quality. truck
c. The goods are transferred to the buyer d. None of the above.
upon constructive or actual delivery
of the thing. 41. Ara bought a washing machine from Bal on
d. The ownership is retained by the instalment basis but defaulted in the
seller. payment of two instalments. Which of the
following is not a remedy of Ara?
34. Asantalicio delivered a television to a. Damages
Barberian on “sale or return “. In this b. Specific performance only
case, the ownership passes to Barberian c. Cancel of sale
upon d. Foreclose the chattel mortgage and
a. Delivery of the television recover from the buyer the difference
b. Expiration of the period agreed upon if the proceeds of the sale is less
c. Acceptance by Barberian of than the unpaid balance of the
Asantalicio’s offer. purchase price.
d. Perfection of the sale
42. Statement 1: in a sale of personal
35. Ownership of the thing sold is property in instalment, the seller is
transferred / acquired / retained: obliged to exercise the remedy of the
a. Retained by the “ sale or return “ foreclosure of the chattel mortgage, if
b. Transferred to the buyer upon there be one, in the event that the buyer
constructive or actual delivery of fails to pay two or more instalments.
the thing sold.
c. Acquired by the buyer upon perfection Statement 2: in a sale of personal
of the contract. property in instalment, if the seller
d. Transferred to the buyer upon decided to foreclose but did not actually
acceptance of the price. sell the property, he may still ask for
specific performance and demand for the
36. Selerio sold to Bayer his Toyota Innova remaining deficiency in the price
Car on January 10. On January 15, an
a. True, False 48. Statement 1: if the thing should have
b. True, True been sold to different buyers, the
c. False, True ownership should be transferred to the
d. False, False person whom may have been in the
possession thereof in good faith; if it
43. Bag bought a refrigerator on Instalment should be movable property.
from Sum and to secure his indebtedness,
Bag executed a chattel mortgage on title Statement 2: the seller is responsible to
refrigerator in favour of Sum. Upon the buyer for any hidden defects or fault
default by Bag on his two (2) payments, in the thing sold only if he was aware
the refrigerator was foreclosed and sold thereof.
for P 8,000 which was less than the
balance of P 10,000 due to Sum. How much a. 1st statement true, 2nd statement false
can Sum still collect from Bag? b. Both statements are false.
a. P 2,000 c. 1st statement false, 2nd statement true
b. P 8,000 d. Both statements are true.
c. P 10,000
d. Nothing 49. Salay, the owner of a parcel of land sold
the same to Basco, a buyer in good faith
44. One of the following is not an but the document was not registered. One
alternative remedy available to a seller year, he sold it again to Bal who knew
of personal property on instalment if of the first dale but registered the
buyer defaults. document and obtained a title over the
a. To go to court and ask court to order land.
delivery of the property. a. Basco is not entitled to the land even
b. To foreclose the chattel mortgage if he is a buyer in good faith.
c. To sue to specific performance b. Basco is the rightful owner because
d. To take possession of the property and the bad faith of Bal renders nothing
forfeit the amount paid by the buyer. but an exercise in futility.
c. Bal being the first registrant is the
45. Sad sold to Bad a motor vehicle for P rightful owner of the land.
1.2M to be paid in twelve equal monthly d. The knowledge of the first sale by Bal
instalments starting the 15th of February, is immaterial because the non-action
2008. To secure the payment of the car, of Basco plus him in estoppels.
Bad executed a chattel mortgage on the
subject motor vehicle and furnished a 50. Sala sold his land to Bata who began to
surely bond issued by Contreras. Bad possess it. Later Caw, a tranger, sold
failed to pay two instalments. Sad went the same land to Dau who in good faith
after Contreras but was not able to registered the sale in the Registry of
obtain only ¾ the total amount still due Deeds. Who should be considered as the
from Bad. Can Sad still collect the owner?
deficiency from Bad? a. Sala because the sale is not
a. Sad can still recover the deficiency registered by Bata.
from Bad because the amount received b. Bata because Dau did not buy it from
from the surely was only payment pro- the owner of the land.
tanto of the obligation. c. Caw because the sale to Dau is a
b. Sad can still foreclose the chattel second sale.
mortgage on the car for the d. Dau being the registrant in good
deficiency. faith.
c. Sad cannot recover the deficiency
anymore applying the Recto Law, that 51. Seoul sold a land to Busan. Then, Seoul
is, Sad can maintain an action for the became Busan’s tenant. Subsequently,
deficiency. Seoul sold the same property to Gangnam.
d. Sad can still recover the deficiency Neither sale was registered. Who is the
after he forecloses the chattel rightful owner?
mortgage on the vehicle. a. Busan being the first buyer in good
faith.
46. Which of the following statement is b. Gangnam because the property was sold
false: to him ny the original owner.
a. In contract to sell, ownership is not c. Seoul because the sale to Busan and
transferred to the buyer even if there Gangnam are not registered in the
is a delivery. Registry of Deeds.
b. Stoppage in transitu can be exercised d. Busan if he will register the sale
by the unpaid seller if the buyer is ahead of Gangnam.
insolvent and the vendor has not yet
parted with the thing sold. 52. Soreta sold his land to Biares. Later,
c. The price is considered certain if it Soreta sold the same land to Baduy.
is reference to another thing Biares in turn sold the same land to
certain. Bastos, who took possession of the land
d. In a right to resell it is not in good faith. Baduy, a purchaser in good
necessary that the original buyer is faith, registered the sale in his favour.
insolvent. Decide:
a. Biares is the owner of the land
47. Anthony sold a piece of land to Rolando because he was the first buyer.
binding himself not to sell the same to b. Biares is the owner of the land having
another person. On the following day, registered the sale in good faith.
Anthony sold the land to Carl who c. Bastos is the owner of the land being
immediately took possession in good the transferee of the rights of Biares
faith. In the case at bar, the proper and who is in possession in good
remedy of Rolando is to: faith.
a. Institute an action for the annulment d. Bastos is the owner because after
of the sale to Carl. Soreta sold the land to Biares,Soreta
b. Institute an action for the recovery had not more right to transfer
of the land. ownership to Baduy, the second buyer.
c. Institute an action for damages
against Anthony. 53. Crystal is the owner of an earring which
d. Answers not given. was stolen by her housemaid. In one
social gathering, she saw the earrings in
the possession of Fatutina. It was horse suffered an illness and died after
discovered that the housemaid sold it in one week. Can Bruno sue Serdan for breach
a jewelry store which in turn sold it to of warranty against hidden defects?
Fatutina, a buyer in good faith. Did the a. Yes, because it is presumed that the
latter acquire good title to the jewelry? horse was already ill when sold.
a. Yes, because it was bought from a b. No, because Serdan was not arware of
merchant’s store in good faith and in the disease at the time of sale.
value. c. Yes, because Serdan is in bad faith.
b. No, because Fatutina did not exercise d. No because the disease did not exist
diligence is buying the earring. at the time of purchase.
c. No, because it was sold by a store
which does not possesses authority to 60. In three of the following there is no
sell it. warranty against hidden defects of
d. Yes, because the seller is also a animals. Which is the exception?
buyer in good faith. a. Animals sold at fairs.
b. Livestock sold as condemned, declared
54. S store a fountain pen from “O” and sold known to the buyer.
it to a bazaar who pays for it in good c. Animals sold at public auction.
faith, not knowing it was stolen. The d. None of the above.
bazaar then sold it to B, a student,
a. The bazaar having bought it in good 61. The vendor is responsible to the vendee
faith becomes the legal owner, and as for any hidden faults or defects in the
such, he can transfer ownership to B. thing sold, even though he was not aware
b. Ownership passed to B because he thereof.
bought it in a merchant store.
c. “O” may recover the fountain pen from If the thing sold had any hidden fault
B without reimbursement because he is at the time of the sale, and should
the legal owner. thereafter be lost by a fortuitous event,
d. B cannot become the owner because S, the latter may demand of the vendor the
the original seller, is not the owner. price which he paid, lee the value which
the thing had when it was lost.
55. Gwen brought is wristwatch in a watch a. True, False
repair shop and store for repair. After b. True, True
it was repaired, the watch repair shop c. False, True
and store sold it to Mommy Mi, a buyer d. False, False
in good faith. Can Gwen recover the
wristwatch from Mommy Mi? 62. Seesy sold to Batok his dog without
a. No, because Mommy Mi is now the lawful knowledge that the animal was suffering
owner of the watch. from a disease at the time of the sale.
b. No, because Mommy M brought it in good Is the seller liable for breach of
faith and for value. warranty against redhibitory defect of
c. Yes, because the seller was not animals?
authorized by Gwen to sell his watch. a. Yes, because he sold have known the
d. Yes, provided he would reimburse defect before selling it to somebody.
Mommy Mi the amount she have paid to b. Yes, if he aware of the hidden fault
the merchant’s store. or defects.
c. No, because redhibitory defect is
56. Sayangco sold a residential land to difficult to discover even in case of
Bitao. Bitao paid the consideration. When professional inspection.
Bitao wanted to register the sale at the d. No, if there was a stipulation and the
Register of Deeds, the latter refused to seller was in good faith when he sold
register it and required the presentation the animals.
of the certificate of capital gains tax
payment. What can Bitao do? 63. One of the following is not a remedy
a. Bitao may sue Sayangco to refund the granted to an unpaid seller.
consideration paid by bitao under the a. Right of stoppage of goods in transit.
maxim “no one shall enrich himself at b. Right of lien owner the goods.
the expense of another“. c. Right of resale.
b. Bitao cannot compel Sayangco to d. Right to demand a security for the
return the selling price because the payment of the price.
contract is not enforceable.
c. Bitao may possess the residential 64. The buyer has a right to the fruit of the
land as a buyer in good faith. thing from the time
d. Bitao may compel Sayangco to pay the a. Thing is delivered
capital gains tax and secure the b. Contract is perfected
Certificate of Capital Gains Tax c. Obligation to deliver the thing
payment. arises
d. Fruits are delivered
57. Warranty against hidden defect is:
a. An essential element. 65. Which of the following statement is not
b. Accidental element correct?
c. Natural element a. The vendor is bound to deliver the
d. None of the above. thing sold and its accessions and
accessories in the condition in whic
58. The following, except one, are the they were upon the perfection of the
alternative remedies available to the contract.
buyer in case of breach of warranty by b. All the fruits of the thing sold shall
the seller. pertain to the vendor from the day on
a. Keep the goods and ask for the which the contract was perfected.
damages. c. The vendor shall not be bound to
b. Refuse to accept the goods and ask for deliver the thing sold, if the vendee
damages. does not paid him the price, or if no
c. Rescind the sale and retain the goods. period for the payment has been fixed
d. Keep the goods and set up against the in the contract.
seller by way of recoupment in price. d. The vendor is bound to transfer the
ownership of and deliver, as well as
59. Serdan sold a racing horse to Bruno on warrant the thing which is the object
February 14, 2008. After five days, the of the sale.
66. Salcedo sold his horse to Caballo for P 71. Sotero and Balbak entered into a contract
15,000. No payment has ben made and no whereby Sotero will sell his computer to
date of delivery was agreed upon. Before Balbak for P20,000. After the perfection
the payment and delivery, the horse gave of the contrac, Balbak advanced the
birth to a pony. entire purchase price but it was
a. Caballo should pay additional amount stipulated that the computer shall
for the pony if he wants to have it. delivered at the end of June of the
b. Caballo is entitled to the pony which current year. Before the arrival of the
was born after the perfection of the date, it was completely destroyed without
sale but before the delivery. any fault of Sotero. Can Balbak recover
c. Salcedo is entitled to the pony since the P20,000?
Caballo has not yet paid the price. a. No, when a thing is lost without fault
d. Salcedo is entitled to the pony of the vendor, he is released from his
because it was born before his obligation to deliver the thing.
obligation to deliver to horse. b. No, because the contract had already
been perfected.
67. Salamanca sold a pig to Bardagol. It was c. Yes, under the principle of res perit
agreed upon that the payment will be made domino
one month after delivery. After delivery d. Yes, but the buyer must also bear the
but before payment of the price, the pig loss. Hence, he can recover P10,000
delivered ten piglets. only.
a. Bardagol is entitled to the piglets
because there was already a delivery. 72. Salando sold to Baybayin his can which is
b. Bardagol should pay the price of the undergoing body repair at a car repair
piglets if he wants to have them. shop owned by Celaje. No fixed date for
c. The piglets should be with Bardagol the performance of their respective
applying the rule that “accessory obligations. The obligation of Baybayin
follows the principal” but he should is:
pay Salamanca of its value as an a. To pay the moment Salando delivers the
application of the same principle. car.
d. Salamanca is entitled to the piglets b. To pay upon demand by Salando.
due to the nonpayment of the purchase c. To pay the price immediately because
price. their obligations are demandable at
once being pure obligation.
68. On jJanuary 6, 2008, Pepe sold to Pilar d. To rescind the sale because there was
his dog named Tagpi with the agreement no agreement as to when their
that delivery shall be on January 15, obligations shall be performed.
2008 and the payment of the rpice will
be on January 31, 2008. If the dog shall 73. 1st Statement: the vendor is bound to
produce offspring, it shall belong to: transfer the ownership of and deliver as
a. If before January 6, 2008 it shall well as warrant the thing which is the
pertain to the seller. object of the sale.
b. If the puppy, Tagpi Jr. Shall be born
on January 10, 2008 it shall still 2nd Statement: payment of price is
pertain to the seller. essential to delivery of the thing sold.
c. Pilar shall only be entitled to Tagpi a. Both statements are true.
Jr. If the puppy is born on January b. Both statements are false
20, 2008. c. 1st Statement is True, 2nd is False
d. If Tagpi Jr. Is born after the sale d. 1st statement is False, 2nd is True
but before the delivery, it shall
pertain to Pilar if so stipulated by 74. Which of the following statements is not
the parties. correct?
a. Actual delivery of the thing or
69. Sebastian sold an automobile to Berdi for payment of the price is not required
P300,000 payable as follows: P100,000 for the perfection of the sale.
upon delivery of the car, and the balance b. A stipulation that even when the
at an amount of P50,000 every month object is delivered to the buyer,
thereafter. The automobile, however was ownership will not pass until the
burned in the possession of Berdi, price is fully paid is not valid.
without his fault, before payment of the c. A sale is consummated upon delivery
balance. Is Berdi obliged to pay the of the thing and the payment of the
balance? purchase price.
a. Yes, because the ownership was d. Sales through letters or telegrams
transmitted to him upon delivery. are deemed perfected only when the
b. Yes, but Sebastian should deliver seller has received acceptance by the
another automobile to Berdi. buyer.
c. No, because the balance is not yet
paid and therefore Sebastian is still 75. Balas buys from Salas 100 cavans of
the owner of the automobile. palay. Which of the following statements
d. No, the loss is imputable to Sebastian is not correct?
applying the principle of res perit a. If Salas delivers only 90 cavans he
domino. can accept them provided that he can
only be required to pay for the number
70. Aden sold his only car to Bisco. After of cavans delivered.
the contract was perfected but before the b. If Salas delivers only 90 cavans, he
delivery, the car was destroyed by a must accept them because it is part
tsunami. It was totally wrecked. Should of the quantity contracted.
Aden deliver a car similar to his? c. If Salas delivers 120 cavans, Balas
a. Yes, because the buyer should not be can reject all.
liable for a fortuitous event. d. If Salas delivers 120 cavans, he may
b. Yes, otherwise Bisco will be accept all, but he must pay for them
prejudiced of not receiving the at the contract rate.
return of his payment.
c. No, because the object is 76. S sold to B a parcel of land for a lump
determinate. sum of P50,000. The contract states that
d. No, even when the seller is guilty of the area is 500 square meters.
delay in the delivery of the car. Subsequently, it was ascertained that the
areas included within the boundaries is c. The seller may demand payment first
actually 550 square meters. before delivery of the thing sold.
a. S is bound to deliver 500 square d. The buyer may demand delivery first
meters and B to pay P50,000 before payment of the price.
b. S is bound to deliver 500 square
meters and B to pay P55,000 82. X sold a parcel of land to Y with the
c. S or B can rescind the sale because agreement that the payment is to be made
there is no meeting of minds. on Feb. 14, 2009. It was stipulated that
d. None of the above. failure to pay on said date. The sale
would automatically be rescinded. Y
77. In Question 76. If the land is contains failed to pay and asked for extension of
445 square meters only. Which of the the time pay. Decide:
following is correct? a. Y may still pay and the sale is not
a. S is bound to deliver 500 square rescinded id there was no demand yet
meters and B to pay P50,000 for rescission from X.
b. S is bound to deliver 445 square b. The sale is rescinded as per
meters and B to pay P44,500 agreement.
c. B may rescind the sale because the c. The sale is rescinded only after
lack in area is more than 1/10 of the demand fro payment by the seller.
total area. d. Y may still pay despite rescission of
d. None of the above. the sale.

78. Salinel sold to Bobos, per unit of 83. Pacto de retro sale is distinguished from
measure, a parcel of Riceland measuring mortgage:
2,000 square meters at a price of P500 a. There is redemption when the
per square meter. Subsequently it was principal debt is paid.
ascertained that the area is not b. There is no transfer of possession of
measuring 2,000 square meters. Which ofo the thing sold.
the following remedies is available to c. There is no foreclosure unless it is
Bobos? declared as an equitable mortgage.
a. Ask for rescission if the area is d. There is no transfer of ownership of
lacking by 1/10th or more of that the thing sold.
stated.
b. Ask for rescission if the area is 84. A stipulation exempting the vendor from
1,000 square meters only. the obligation to answer for eviction
c. Be required to pay an amount shall be void even if he acted in good
corresponding to 2,000 square meters faith.
even if the area is 1,900 square
meters only. The vendor is not liable for
d. Require Salinel to accept an amount dispossession due to acts imputable to
corresponding to 2,000 square meters the buyer himself.
even if the area is 2,100 square a. True, False
meters. b. True, True
c. False, True
79. The following options are available to d. False, False
the buyer of real estate at the rate of
a certain per unit of measure, except: 85. The sale shall not be presumed to be an
a. Proportionate reduction in the price equitable mortgage when?
if the lack in the area is less than a. The price of the sale is usually
1/10; adequate.
b. Rescission of sale if the lack in the b. The vendor remains in possession of
area is not less than 1/10; the thing sold.
c. If the area is more than stated in the c. The vendor allows the extension of
contract, accept the area stated in time to repurchase the thing sold.
and reject the rest; d. The purchaser retains for himself a
d. Rescind the contract if the area is part of the purchase price.
more than that stated in the contract.
86. The vendor is responsible to the vendee
80. Bolabong bought from Senyang a second for any hidden faults or defects in the
hand motorcycle which upon inspection by thing sold, even though he was not aware
Bolabog had some patent mechanical thereof.
troubles. After the sale, the motorcycle
was bumped on another vehicle due to When the price of a sale which right to
defective brakes creating damages to the repurchase is unusually inadequate, the
motorcycle ad on the other vehicle. Is contract shall be presumed to be a pacto
Senyang liable fro breach of warranty de retro.
against hidden defect? a. True, True
a. No, because the defect was not hidden b. True, false
but apparent upon inspection by c. False, False
Bolabog it being a seconh hand car. d. False, True
b. Yes, because there was no waiver of
warranty against hidden defect. 87. Where it is stipulated that the
c. Yes, because the seller was in bad repurchase of the property sold could be
faith and she has to pay for the made at any time, the repurchase shall be
damage done on the other vehicle. exercised
d. No, because it was fault of Bolabog, a. Within four years from the date of
he should have bought a brand-new contract.
motorcycle. b. Within ten years from the date of the
contract.
81. Segunda sold his car to Bakekang. No c. After ten years from the date of the
agreement was made on the time and place contract.
of delivery and payment, hence: d. None of them
a. The time and place of delivery shall
be at the time and place of payment 88. Where it is stipulated that the
of the price. repurchase of the property sold could be
b. The time and place of delivery and made at any time, the repurchase shall be
payment not having been agreed upon, exercised
the sale shall be void.
a. Within four years from the date of d. Babol and Cortez have no right of
contract. legal redemption.
b. Within ten years from the date of the
contract. 94. Servino owns a piece of land and sells
c. After ten years from the date of the it to Sam with the right of repurchase
contract. within four (4) years from the date of
d. Within six years from the date of the sale. If Sam sells the property to Rose,
contract. which of the following is false?
a. The sale is valid because things
89. Sall sold his land to Bay on March 15, subject to a resolutory condition
2008 with a right to repurchase. The maybe the object of a contract of
contract provides that the land will be sale.
redeemed in March of any year. Until when b. Servino can still exercise her right
Sall can repurchase the property? of redemption against Rose.
a. March 15, 2012 c. The sale is void because it is a
b. March 15, 2018 conditional sale.
c. March 15, 2009 d. Rose acquires the property but
d. March 15, 2011 subject to the right of conventional
redemption.
90. If redemption is made, which of the
following will not be paid by the seller 95. Senso owns a piece of land and sells it
to the buyer? to Bicad with a right or repurchase
a. Price paid by the buyer within one year from the date of sale.
b. Expenses in the execution of the sales Can Bicad sell the land he purchased from
of contract paid by the buyer. Senso to Burat, a third party?
c. All necessary expenses on the thing a. Yes, provided that the sale is with
sold and to be redeemed. the consent of Senso.
d. Interest on the price paid by the b. No, Bicad is not yet the absolute
buyer. owner of the land.
c. Yes, but Sesno can still redeem the
91. Abagat, Barra and Caballero, are co- land from Burat.
owners of an undivided parcel of land. d. No, third parties that acquire real
Barra sold his 1/3 interedt to Caballero property are bound by prior contracts
absolutely. Which is correct? affecting such property even if the
a. Abagat may exercise his right of third person is not a party thereto.
redemption on the interest sold by
Barra to Caballero. 96. Arnesto, Balane and Camposano are co-
b. Abagat cannot exercise the right of owners of a parcel of land. Arnesto sold
redemption because the sale was made his share to Balane. Can Camposano redeem
in favour of a co-owner. the said share from Balane?
c. The sale made by Barra to Caballero a. No, unless he was notified of the sale
is void because it was not made in prior to its perfection.
favour of a stranger. b. No, legal redemption applies only if
d. Abagat may redeem only ½ of the the interest was alienated by onerous
interest sold by Barra to Caballero. title to a third person.
c. Yes, because the law frowns upon co-
92. Arines, Babagay and Casyao are co-owners ownership.
in equal share of parcel of land. Casyao d. Yes, provided he pays Balane the
sold his undivided interest to his son. price, expenses of the sale and
Dava, a week later, Arines and Babagay necessary and useful expenseson the
served notice on Dava of their intention thing sold.
to redemme the portion sold. However,
Dava refused to allow redemption arguing 97. Ann and Boy are co-owners of a parcel of
thet being the son of Casyao, he was not land. Dan owns a parcel of land adjoining
a third person in contemplation of the the co-ownership. Ann sold his share to
law with respect to redemption by co- Char. Both Boy and Dan want to redeem the
owners. Is the refusal of Dava justified? share of Ann which is latter sold to
a. No, the refusal of Dava is not Char.
justified because he is still a third a. Boy and Dan should equally redeem the
person as regards redemption by co- share of Ann.
owners. b. The right of Boy as co-owner is
b. No, because Dava’s refusal is preferred over Dan who is only an
unjustified because co-owners can adjoining owner.
redeem the share sold even if not sold c. Dn should be preferred over Boy in the
to a third person redemption from Dan.
c. Yes, justified because he is not a d. None of them acquires the right of
third person being the heir of Casyao redemption.
from whom he will eventually inherit
the share in the land. 98. Which of the following is false about
d. No, because co-owners can redeem the sale with a right to repurchase?
share even if sold to a co-owner. a. Legal redemption ca be effected only
against immovable property.
93. Abonal, Babol and Cortez as brothers b. There is transfer of ownership to the
purchased from their parents specific buyer subject to a resolutory
portions of a parcel of land as evidenced condition.
by three separate deeds of sale. Each c. If several persons, jointly and in the
deed referring to a particular lot in same contract, should sell an
meters and bounds. Abonal sold his parcel undivided immovable with a right to
of land to De Belen, Baboland Cortez want repurchase, none of them may exercise
to redeem the land. Decide; this right for more than his
a. Both Babol and Cortez may exercise the respective share.
right to redemption in a pacto de d. The buyer a retro may mortgage the
retro sale. property because he acquires the
b. Either of Babol and Cortez mat do so rights of the vendor.
if there is right of redemption given
to them by De Belen. 99. Aki owns a parcel of land, which he sells
c. Babol and Cortez have the right of to Bing with a three year redemption
legal redemption. period. After the second year, Aki dies,
leaving his children Cave, Dave and Eve them from his stock and made it appear
as his heirs. Which of the following is that he bought them from a supplier at
not correct? the regular price of P600, which was the
a. As Aki can repurchase the whole thing, same purchase price of palay in his
so any among Cave, Dave and Eve may earlier transactions.
repurchase the whole thing. a. Akbahar must account to Pacifico all
b. Cave can redeem his 1/3 share, Dave the profits that he obtained from the
his 1/3 share and Eve his 1/3 share transactions.
if Bing does not require all of them b. Akhbahar need not account to PAcifico
or any one of them to redeem the whole the profits that he obtained from all
property. the transactions.
c. Bing may demand that all the co-heirs c. Akbahar need not render an accounting
come to an agreement upon the of his transactions because he was not
repurchase of the whole thing sold. obligated to do so under the power of
d. Bing cannot be compelled to consent attorney given to him by Pacifico.
to a partial redemption. d. Akbahar cannot be held liable for
damages because he passed on the palay
100. In 2008, Albia bound himself to to Pacifico at the purchase price of
sell to Bolalin his house and lot which his previous transactions.
was being rented by another person. If 5. Lease of services is distinguished from
Bolalin passes the CPA examination on agency except on the following.
October 2008. Luckily for Bolalin, he a. The worker does not represent his
passed the said examination. However, employer.
Albia sold the said property to Cord in b. The implementor exercises
2008after the agreement was entered into discretionary powers.
by Albia and Bolalin. Was the sale valid? c. Generally, the relationship can be
a. The sale was not valid because the terminated only at the will of both
property was already sold by Albia to parties.
Bolalin although it was subject to a d. It usually involves in two persons.
suspensive condition.
b. The same was not valid if Cord was 6. The following distinguished agency from
aware of the promise to sell of Albia a negotiorum gestio except
to Bolalin. a. Quasi-contract
c. It was a valid sale because Albia was b. There is meeting of the minds
still the owner of the house and lot expressly or impliedly
at the time of the sale but with c. The legal relation is created by the
resolutory condition. parties.
d. It was a valid sale if the buyer was d. One party performs according to the
in good faith and for value and control of the other.
without the knowledge of the promise
to sell of Albia to Bolalin. 7. All of the following are characteristics
of an agency to sell, except
a. Receives the goods as the goods of the
AGENCY principal.
b. The agents deliver the proceeds of the
sale
1. ALing ask his neighbour, Aze to buy some c. Receives the goods as owner
vegetables for her in the market to which d. The agent does not warrant the thing
request the latter agreed. The contract against hidden defects.
between them is:
a. Sale 8. In agency, the agent represents
b. Piece of work a. A person who is capacitated.
c. Agency b. A person who is incapacitated.
d. Contract to Sell c. Heirs and creditors of the estate or
the debtor.
2. Which of the following is not a d. Judicial court
characteristic of an agency? e. None of the above
a. Principal
b. Nominate 9. Pandekoko gave a special power of
c. Commutative attorney to Amay, a 13 year old high
d. Gratuitous school student, authorizing the latte rto
sell his car. Amay sold the car for
3. Statement 1: a contract is needed to have P150,000. Which of the following
an agency relationship statement is false?
Statement 2: the agent owes a fiduciary a. The contract of agency between
duty to the principal Pandekoko and Amay is voidable.
Statement 3: The principal owes a b. The contract of sale between
fiduciary duty to the agent Pandekoko and Amay is valid.
c. The contract of sale between
Which of the above statements is true? Pandekoko and Amay is unenforceable.
a. Statement 1 only d. The guardion or parent of Amay can ask
b. Statement 2 only for the annulment of the contract of
c. Statement 3 only agency.
d. Statements 2 and 3
10. Pal, 50 year old, appointed Ams, 16 years
4. Akbahar has been the agent of Pacifico old. As his agent of sell to his necklace
for the past 3 years in the purchase of for P12,000. Thereafter, Ams sold the
palayvin different provinces in Luzon. necklace to Bara for tha said amount.
The authority given by Pacifico to When Pal learn that the contract price of
Akbahar provided that Akbahar need not the necklace is P20,000 he sought to
render an accounting of his transactions. annul the sla eand brought an action to
One day, Akbahar chanced upon a recover the necklace on the ground that
wholesaler of palay who offered to sell the sale is voidable because Ams is
them to Akbahar at the discounted price minor. Is the action of Pal justified?
of P500 per sack. Akbahar purchased all a. Yes, because the agent is incapable
the palay using his own money and stored of giving consent to the contract.
them in the warehouse. Every time that b. Yes, Bara took advantage of the
Pacifico needed palay, Akbahar would get minority of the agent.
c. No, because the contract is c. Yes, unless Are habitually engaged in
unenforceable the agent having the business of selling and buying
exceeded his authority. cars.
d. No, because Pal is capable of entering d. None, acceptance must always be
into a contract. expressed.

11. Pogi authorized Panget, a minor, to sell 16. Parra sends a letter to Arro in Iriga
his car for P1M in cash. Panget sold the City, authorizing Arro to sell his
said Car to Ganda on instalment at a specific car for P300,000. No reply is
lesser price of P900,000. Pogi is now made by Arro. Is there a presumption of
repudiating the contract with Ganda on implied agency between the two?
the ground that he is not bound since a. Yes, unless evoked by Parra before
Ganda contracted with the minor who accepted is made.
exceeded his authority. Decide b. Yes, the failure to reply is an
a. Pogi is liable under the contract implied acceptance of implied
because it is enough that principal consent.
is capacitated since he is the one c. O, if Arro is habitually engaged in
entering into the contract. the business of buying and selling of
b. Pogi is not liable for the sale on cars.
instalments since it is unenforceable d. No, as between persons who are absent,
because his agent acted beyond its acceptance by the agency cannot be
powers. presumed from the silence of the
c. Pogi is not liable because the agent agent.
is a minor with whom Ganda had
contracted. 17. Panta, a resident of Ilocos Norte, wrote
d. Pogi is liable provided the sale is Ali, his friend in Bicol who is engaged
in cash fro P1M. in buying and selling second hand car, to
sell his(Panta) Toyota Corolla Car. Ali
12. Which of the following does not create an did not reply to the letter.
implied agency? a. There is implied agency due to non-
a. Failure to repudiate the agency by the acceptance of the authority.
principal. b. There is not implied agency because
b. Silence of the principal between persons who are absent, the
c. Express authority given by the acceptance of the agency cannot be
principal implied from the silence of the agent.
d. Principal’s lack of action c. There is no implied agency until Ali
starts to act under the authority
13. Mar Cas, before going to London, conferred upon him.
appointed Jul Cas as his agent administer d. An implied agency is created even
his properties in the Philippines. without reply from Ali.
Afterwards, Jul Cas wrote Mar Cas that he
(Jul Cas) was withdrawing from the agency 18. The following statements pertain to the
because of hailing health. Jul Cas, in appointment of an agent
the same letter, said that he appointed
Cas Cas as his substitute and that Mar I. If the announcement of appointment
Cas should extend new appointment to Cas of an agent is by special
Cas. Cas Cas took over the duties of Jul information, the person appointed
Cas but Mar Cas did not bother to appoint will be considered a duly
Cas Cas ah his agent until Mar Cas death. authorized agent with respect to
Now, Mar Cas’ heirs bought an action the person who received the
against Cas Cas fro accounting. Cas Cas special information.
raised the defense that he was not
validly constituted as agent of Mar Cas. II. If the announcement of the
In the case at bar, defense is not appointment of an agent is made by
tenable because there is public advertisement, such as
a. An actual agent publication in a newspaper of
b. An implied agent general circulation, the person
c. A general agent appointed will be considered as
d. Answer not given agent which regard to any person
who reads the publication.
14. The is not implied agency in the
following In your evaluation of the foregoing
a. The principal delivers his power of statements:
attorney to the agent and the latter
receives it without any objection. a. Both statements are true
b. The offeree writes a letter b. Both statements are false
acknowledging the receipt of te c. Only statement 1 is true
offer, but offers no objection to the d. Only statement 2 is true
agency.
c. The offeree begins to act under the 19. Ad Company wrote a letter to Better
authority conferred upon him. educational Supply which introduced
d. The offeree receives a letter of Botoc as its newly authorized agent.
authority but did not reply nor acted Better Educational Supply then dealt with
within the scope of authority the company thru Botoc. After six(6)
conferred upon him. months, the authority of Botoc was
revoked without informing the customer of
15. Pare sends a letter to Are in Cavite, the revocation. Better Educational
authorizing Are to sell his specific car Supply continued to deal with Botoc. Is
for P90,000. If no reply is made by Are, Ad Company liable for the act of Botoc?
is there a presumption of implied agency a. Yes, but until the revocation of the
between two of them? agency only.
a. None, because as between persons who b. Yes, but effective only from the time
are absent, acceptance of the agency the letter was received until the
cannot be presumed from the silence authority of the agent was revoked by
of the agent. the company.
b. Yes, because no reply was sent; there c. Yes, even after the revocation for the
is an implied acceptance or implied customer was in good faith not having
consent
been informed by circular or b. The authority of B from A is by way
otherwise of the revocation. of letter and B sells the land to C
d. No, the company was never become in writing.
liable for the acts of Botoc. c. The authority of B is oral and B sells
the land to C for P50,000 in a written
20. Top of the Line Corporation published in contract of sale.
the calssififed ads of the Philippine d. The authority of B is in writing but
Daily Inquirer that Chua is its duly the sale of the land in writing was
authorized agent to sell its product in made beyond the period expressly set
Southern Luzon. After 5 years, the forth by A.
corporation revoked the authority by
giving notice of revocation to Chua and 25. A appoints B to sell his land.
publishing a notice of revocation in the
Philippine Star. Despite the revocation, Example 1 – if the authority of B is oral
Chua was still able to sell goods worth and B sells the land in writing, the sale
P60,000 to Diana who did not read the is valid.
revocation. Should Top of the Line
Corporation deliver the goods? Example 2 – if the authority of B is in
a. No, it is not obliged to deliver writing and B sells the land orally, the
because Diana have known the sale is valid.
revocation of Chua’s authority.
b. Yes, because Diana did not read the Which is correct?
revocation of Chua’s authority. a. 1st example is false but 2nd example is
c. Yes, because the revocation was not true.
binding on Diana since it was b. Both examples are true.
published in a different newspaper. c. Both examples are false.
d. No, because the notice of revocation d. 1st example is true but the 2nd example
to Chua is sufficient. is false.

21. M Company wrote a circular letter to its 26. Pan wrote his friend. Ali to sell his
customer introducing a certain A as its land in Zamboanga City. This land was
duly authorized agent. X, a customer, purchased by Bal, a third person.. Ali
dealt or transacted a business with A. did not remit the money. Pan now wants
Later, A’s authority was revoked and was to recover the land from Bal.
published in a newspaper of generation a. Pan cannot recover because an agency
circulation. Notwithstanding his by estoppels has been created.
knowledge of such revocation, X continues b. Pan can recover because Ali is in bad
to transact business with M Company thru faith.
A. Is M Company still liable for the c. Pan can recover because the authority
agent’s act even after revocation? did not comply with the requisite that
a. Yes, because the revocation was not it must be in a special power of
given in the same way the power was attorney.
gained. d. Pan cannot recover because the sale
b. No more, because the third person (X) is valid, the letter being a
is in bad faith. sufficient authority.
c. No, more, because the transaction
that will be entered after revocation 27.
will be void.
d. Answers not given. 28. Pene made Arro as his agent for all his
properties. The contract indicates that
22. Pund met Ter and introduced Al as the “Pene withholds no power from the agent
agent of Pud. As a result, Ter dealt with and that the latter can execute acts
Al. Is Pund liable for the acts of Al which he considers deem appropriate and
when as a matter of fact, it is not true that the agent is given general and
that Al is his agent? unlimited powers.” Which of the following
a. Yes, for what is created here is an acts can be validly done by Arro?
implied agency. a. To compromise in behalf of Pene.
b. Yes, because Pund created an agency b. To lease real property to another
by estoppel. person for more than one year.
c. No, because Al is not really an agent c. To make customary gifts for charity.
of Pund. d. To sell or mortgage Pene’s land.
d. \no, because neither an implied
agency nor an agency by estoppels has 29. P appointed A as his agent with a
been created among the parties. generally worded authority stating that
he withholds no power from A and that he
23. Pal, a Filipino citizen called his has allowed him absolute and unlimited
brother, Ar, by phone, authorizing the powers. Accordingly, A sold P’s house and
latter to sell his 5—hectare Riceland lot to X; leased to T an apartment unit
located in Nueve Ecija. On the strength for 2 years; also leased to W, P’s car
of such authority, Ar sold the land for 5 years.
belonging to his brother. Is the sale a. All the contract of A with X, T and W
valid? are valid and enforceable.
a. Yes, because the sale has been b. All the contract of A with X, T and W
authorized by Pal, the owner of the are unenforceable.
land. c. The contract with X and T are
b. Yes, if the sales instrument is unenforceable but the contract with W
reduced in writing. is valid and enforceable.
c. No, because the authority to sell must d. The contract with W is unenforceable
be reduced in writing. but the contract with X and T are
d. No, because the authority to sell must valid and enforceable.
be in a public instrument.
30. Considered “mere acts of
24. A appoints B as his agent to sell his administration”, which an agent is
land. Which of the following is perfectly authorized to do if given an agency
valid? couched in “general term”. Which is the
a. The authority of B is in writing and exception?
the sale of the land n favour of C is a. To sue for the collection of debts and
oral. to engage services of a counsel to
preserve the ownership and possession c. Make usual representations and
of the principal’s property. warranty.
b. To give customary gifts for charity d. To deliver the property.
or the employees in the business
managed by the agent. 39. Which of the following contracts is void?
c. Unregistered lease of real property 1st: the agent acting without authority in
to another person for one year. behalf of the principal.
d. None of the above. 2nd: the agent acting without authority
and in behalf of himself.

31. Which of these in not an act of ownership a. 1st contact only


and, therefore, need to be contained in b. 2nd contract only
a special power of attorney for the agent c. Neither 1st nor 2nd contracts
to possess the same? d. Both 1st and 2nd contracts
a. To make payments which are in the
ordinary course of business. 40. Without authority with Gon, Killua sold
b. To effect novations which put an end Gon’s car to Kurapika in behalf of Gon.
to obligations contracted before the a. The transaction is void because
agency. Killua is not authorized by Gon.
c. To waive an obligation gratuitously. b. The contract in unenforceable which
d. To obligate the principal as a cannot be ratified.
guarantor. c. Gon is not bound by the transaction
unless he ratifies.
32. Which of the following constitute an act d. Kurapika can have a claim against Gon
of strict domination or ownership? because the property belongs to the
a. To bind the principal to render some latter.
service without compensation.
b. To sue for the collection of debts. 41. The agent, excess of the authority given
c. To lease real property to another to him by his principal enters into a
person for six months. contract with a third person. If the
d. To make customary gifts for charity. principal ratifies the contract, who will
be liable to the third person, if any?
33. Three of the following requires a special a. Only the principal
power of attorney. Which is the b. Only the agent
exception? c. Both the principal and the agent
a. Accept inheritance. jointly
b. To waive obligation gratuitously. d. Both the principal and the agent
c. To bind the principal in a contract solidarily.
of partnership.
d. None of the above. 42. P appointed A as an agent to sell P’s car
for P500,000. Thru A’s good marketing
34. Which of the following statement is true? style, he was able to sell the car for
a. In a principal appoints an agent in P600,000, 50% downpayment, 50% payable in
writing with respect to the slae of a 2 years. Hence,
piece of land and the latter sold it a. Sale is unenforceable. A must render
to a buyer orally, the contract an account of his transaction to P up
between the agent and the buyer is to P500,000 only.
void. b. Sale in enforceable. A must render an
b. A contract of agency is generally account of his transaction to P up to
gratuitous. P600,000 after collection.
c. To lease a personal property to c. Sale is enforceable because A sold it
another person for more than one year in a manner more advantageous than
does not require a special power of that instructed by the principal.
attorney. d. Sale is unenforceable because B
d. The insolvency of the principal but exceeded his authority.
not the agent shall extinguish the
agency. 43. Ben authorized Alf to sell goods
belonging to the farmer. Alf sold the
35. If an agents contract in the name of his goods without disclosing the principal.
principal, exceeding the scope of his The buyer is not also aware that Alf is
authority, which would be the status and merely an agent of Ben. Which of the
effect of the contract? following statement is correct?
a. Unenforceable a. Ben is not bound because the agent
b. Void acted in his own name.
c. Voidable b. Alf is not bound because the
d. Valid transaction is null and void.
e. None of the above c. Alf is bound because the agent is
authorized, but the buyer cannot
36. Pera executed a special power of attorney proceed against the undisclosed
authorizing Aba to mortgage his land. Aba principal.
sold the same. Is the sale void? d. The buyer takes little to the
a. Yes, a special power to sell includes merchandise but Ben can maintain
the power to mortgage. successfully an action against him
b. Yes, because it is voidable. for the recovery of the goods or for
c. No, because it is unenforceable damages.
d. No, because it is perfectly valid.
44. A, agent of P, in excess of authority
37. A special power to sell includes the entered into a contract in the name of P
power to with X who kbew of the lack of authority
a. Mortgage and P did not ratify the contract. The
b. Barter contract is
c. Sell on Credit a. Rescissible
d. None of the above b. Voidable
c. Unenforceable
38. The power of sell does not carry with it d. Void
the power to 45. If an agent contracts in the name of his
a. Find a purchaser or to sell directly. principal, exceeding the scope of his
b. To pledge authority, what would be the status and
effect of the contract if the other party 51. Yong authorized Jong to sell his electric
knows that he (agent) is unauthorized? typewriter. He instructed Jong to sell it
a. Void contract for P5,000. Jong offered the lectric
b. Voidable contract typewriter to Jung, who agreed to buy it
c. Unenforceable contract for P6,000. Which of the following
d. Rescissible contract statement is false?
a. Jong cannot sell it to Jung because
46. Sunako is the agent of Kyohei, Kyohei the instruction of Yong is to sell it
athorized Hiroshi to sell his BMW car on for P5,000 only.
installemt basis, Nao, the buyer paid the b. Jong can sell it and deliver for
downpayment, hence, the car was P6,000 but he is required only to
deliveres. Nao, however did not pay the remit P5,000.
balance, in a suit for collection of sum c. Jong should inform Jung that the
of money, Nao interposed the defense that selling price of the electric
Kyohei has no personality to sue him typewriter is P5,000.
because Sunako did not disclose Kyohei as d. Jong can sell it to Jung and deliver
the principal. the total purchase price to Yong.
a. Nao is correct because the contract
deals only with hum and Sunako. 52. Spongebob appointed Patrick to sell his
b. The defense of Nao is correct because car in cash for P1M. Patrick sold for
the correct procedure is for Kyohei P1.5 M on straight term with a
to collect the balance from Sunako and downpayment of 50% and the balance after
for the latter also to collect from delivery of the car. The contract of sale
him. us
c. Te defense of Nao is not correct a. Void sale because it was not made in
because Sunako dealt with property cash as instructed by Spongebob.
belonging to Kyohei. b. Unenforceable sale because Patrick
d. The defense of Nao is not correct exceeded his authority.
because Sunako is an agent of Kyohei. c. Voidable because the buyer was misled
as to the price of the car.
47. Conan appointed Sinichi to sell his car d. Valid because Patrick did not
for P300,000. Sinichi sold the car to exceeded his authority since the
Haibara for P300,000 but Sinischi acted contract was advantageous to the
in his name. After delivery Haibara principal.
inspected the car and he found hidden
defects in the car. Can Haibara file an 53. An agent with a general powers of
action against Conan even when Shinichi administration, desirous of improving
acted in his own name? the financial condition of his
a. No, under caveat emptor or let the principal’s business, sold a piece of
buyer beware. land belonging to his principal for
b. Yes, because this is a contract P1,000,000 which is double the price that
involving a property belonging to the appeared in an inventory prepared by the
principal. principal before leaving the place.
c. No, because the agent acted in his own a. The sale is valid because it is
name. obviously to the advantage of the
d. No, because this is unenforceable by principal.
law. b. The sale is valid because no
prohibition was emphasized to sell
48. By virtue of the existence of an the property.
emergency, the authority of an agent is c. The sale is not valid because there
correspondingly enlarged in order ti cope was no clear instruction from the
with the exigencies or the necessities of principal to sell the land.
the moment. d. The sale is not valid because an agent
a. Implied agency with powers of administration cannot
b. Agency by estoppels perform an act of strict dominant
c. Agency by necessity without a special power of attorney.
d. Agency by ratification
54. Minam appointed Shin to manage his
49. One of the following is not a requisite businesses in the Philippines while he
if agency by necessity. was in abroad. Upon Minan’s return he
a. Existence of a very urgent situation. noticed that his 2006 Toyota Innova car
b. Agent cannot communicate with the was sold by Shin to Lee in amount of
principal P500,000 and the registration has been
c. The additional power is for the transferred to Lee although there was
protection of the principal and still a balalnce amounting to P100,000.
agent. Minam demanded from Lee the payment of
d. The authority ceases immediately when the balance where Lee paid him. In this
no longer needed. case
a. The sale of the car is not valid
50. Goblin appointed Grim Reaper as agent to because Shin acted beyond the scope
sell his house and lot for P2 < on of his authority.
instalment basis, Grim Reaper, however, b. The sale is valid because it has been
was able to sell it for the same price ratified by Minam.
in cash. c. The sale is unenforceable because
a. Grim Reaper is liable to Goblin for Shin is not armed with a special power
damages due to bad faith. of attorney.
b. Grim Reaper is liable to Goblin d. The sale is voidable which can be
because he had exceeded his ratified by Minam.
authority.
c. Grim reaper is not liable to Goblin 55. Mitch appointed George as his agent to a
even if he had exceeded his authority. certain transaction. While in course of
d. Grim Reaper is liable even if the performing the job of an agency, Mitch
transaction is beneficial to Goblin, died. Which is not correct?
because a general power of a. The death of Mitch terminates the
administration only was given and not agency.
a special power of attorney. b. George is still obliged to finish the
transaction already begun should
delay entail any danger.
c. Despite danger that may entail in case on credit, he can collect cash payment
of delay, the agency should from Nick
automatically be terminated. a. P4,500 (P5,000 less P500 commission)
d. The transaction that has been started b. P5,000 (the price without commission)
should be estoppels if delay does not c. P5,400 (P6,000 less P600)
entail any danger. d. Answers not given

56. Question 1: Chace authorized KC to borrow 63. A guarantee commission agent


money for him. May KC lend his own money a. Bears the risk of collection on the
to Chace? same terms agreed upon with the
purchaser.
Question 2: Chace authorized KC to lend b. Is liable to the principal even if the
the money of the former at interest. Can buyer is really insolvent.
KC borrow Chace’s money without the c. Is liable for damages if he will not
knowledge of Chace? collect the credit on time.
d. Is entitled to another commission
a. Yes to 1st Question; No to 2nd Question aside from ordinary commission.
b. No to 1st Question; Yes to 2nd Question e. All of the above
c. Yes to both questions.
d. No to both questions. 64. Features of guarantee commission agent.
Which is the exception?
57. Cy constituted Jen as her authorized a. Entitled to another commission from
agent to sell the former’s lancer car for ordinary commission.
P300,000 and to pay him a 5% commission b. Liable for damages if he will not
based on the selling price. Jen sold the collect the credit on time.
car for P320,000. Jen should remit to Cy? c. Liable to the principal even if the
a. P300,000 buyer is really insolvent
b. P320,000 d. None of the above
c. P285,000
d. P305,000 65. June appointed July as his agent to sell
his property for P100,000 om credit. July
58. Cristy authorized Carl to sell his car is given 10% ordinary commission and 15%
for P500,000 cash with 10% commission. guarantee commission. July sold the
Carl was able to sell the car for property to August for P100,000 o credit
P600,000 cash or P100,000 more than and in the name of June payable in 60
Cristy’s price. For what amount is Carl days. If on the 60th day, August is
accountable to Cristy? insolvent
a. P600,000 a. July is not responsible because he
b. P500,000 aced in the name of June.
c. P450,000 b. July is liable to June to the extent
d. P540,000 of his commission of 10%.
c. July should pay June the entire amount
59. Janell appointed Gian as her agent to of P100,000 minus the guarantee
sell her specific car in cash for commission.
P100,000 with 10% commission. Gian using d. July should pay June the amount of
persuasive skills was able to sell it for P100,000.
P150,000 on credit. After the sale but
before payment of the buyer 66. October authorized November to sell his
a. Gian must give P100,000 only. products with 10% commission and 5%
b. Gian must give P100,000 minus the guarantee commission. November sod it to
commission. December who failed to pay despite
c. Gian must give P150,000 minus the diligent efforts of November in
commission. collecting. Is November still liable for
d. Gian must give P150,000 and Janell in the purchase price?
turn is to give Gian P50,000 as a. Yes, because of the guarantee
commission. commission given to him.
b. No, because he was not at fault in the
60. X delivers 10 sets of television to Y for collection.
the latter to sell them for P10,000 each. c. No, if he returns the guarantee
Y 10% commission is agreed upon the commission.
parties. One day Y sells one TV set to a d. Yes, and he is not entitled anymore
customer on credit but for the price of to the commissions.
P12,000. Suppose that X does not consent
to the sale on credit. 67. In three of the following cases, the
a. X may demand P10,800 from Y. agent can appoint a substitute, except
b. X may demand P10,000 from Y. a. The principal authorized him to
c. X may consider the contract as appoint a substitute.
unenforceable. b. The principal did not authorize him
d. X may demand P9,000 from Y. to appoint a substitute.
c. There is no stipulation as to the
61. Blue is authorized by Green to sell ten appointment of a substitute.
books for P100 each at 10% commission. d. The principal forbids the appointment
Blue sells books to Pink on credit but of a substitute.
for a price of P120 each. After ratifying
the sale on credit, how much cash can 68. Zhell appointed Kerl as her agent. In the
Green collect from Pink? contract, nothing was mentioned as to
a. P1,000 whether Kerl could appoint a substitute.
b. P1,200 Which of the following statements is
c. P1,080 wrong?
d. P900 a. Kerl could appoint Tin as her
substitute even without prior
62. Nick is authorized by Mark to sell the permission from Zhell.
latter’s washing machines for P5,000 each b. If Kerl appoints Tin as a substitute
at 10% commission. One day, Mark sells and Tin violated the instructions of
one washing machine to Joy on credit the principal. Zhell can hold Kerl
(payable in 90 days) but for a price of liable.
P6,000. If Mark does not ratify this sale
c. The appointment of substitute by Kerl c. Accomplishment of the purpose
without permission from Zhell is d. Death of the principal
void.
d. If Kerl appoints Tin as a substitute 75. Three of the following are modes of
and Tin violated the instructions of extinguishing an agency. Which is the
the principal, Zhell can hold Tin exception?
liable. a. Expiration of the period.
b. Insanity of the principal or the
69. An agent without any express from the agent.
principal appointed a sub-agent to help c. Death of the principal wherein the
him carry out the agency. agency is for the interest of both
a. The substitution is void. agent and principal.
b. The substitution is valid but is the d. Dissolution of the firm which
only agent is liable for the acts of entrusted or accepted the agency.
the sub-agent.
c. Both the agent and the sub-agent are 76. Kelly in indebted to Jason in the amount
liable to the principal for the acts of P100,000. As she failed to pay the
of the sub-agent under the valid same, she executed a document authorizing
substitution. Jason to collect a debt due her from Ken
d. The substitution is valid, the in the amount of P200,000 with the
substitute is the only one liable for condition that if Jason could collect, he
his own acts. must remit to Kelly the amount of
e. None of the above. P100,000. One month, thereafter, Kelly
wrote Jason that she is revoking the
70. Haha appointed Skull as his agent to sell agency. Is the agency revoked?
Haha’s goods for P100,000 with a a. No, the information should have been
stipulation not to appoint a sub-agent. reduced in a public document.
However, Skull appointed Kook a ssub- b. No, Kelly should first pay Jason
agent. The day after his appointment, before the agency can be property
Kook sold the goods to JiHoo, a buyer in revoked.
good faith. Is the sale enforceable to c. Yes, because an agency is revocable
the principal? at the will of the principal.
a. Yes, because Kook is in good faith. d. Yes, Jason can just collect the
b. Yes, after all there was no damage P100,000 from Kelly.
suffered by the principal.
c. No, because Skull was prohibited to 77. Elia was granted general powers by Yoan.
appoint a sub-agent. Suppose Yoan revoked the authority, but
d. No, the contract is invalid until Serenity and Kyle dealt with Elia without
approved by the court. knowledge of such revocation. Will
contract bind Elia?
71. X,Y,Z appointed by R as his agents to a. No, if notice of revocation published
administer his building which were rented only in a newspaper of general
by various tenants while R was abroad for publication.
three years. In the course of management. b. No, even if notice of revocation was
X caused through his fault damage to the published in a newspaper of general
building which assessed at P30,000. R can publication.
claim. c. Yes, because the agent had general
a. P10,000 from each X,Y and Z. powers even if not published in a
b. P30,000 from X. newspaper of general circulation.
c. P30,000 from Y and Z d. Yes, because the agent had general
d. P30,000 from either X, Y and Z powers but the revocation must be
published in a newspaper of general
72. Kyle appoints Jay and Potch as his circulation.
agents. Jay and Potch agreed to be bound
solidarily. Suppose Jay performed the 78. Mikaela appointed Mharie as her agent to
agency negligently which caused damage to sell her house and lot. One week,
Kyle, can Kyle hold Potch liable for the thereafter, Mikaela appointed Shen as her
damage? agent to sell the same house and lot.
What is the effect of the appointment of
1st answer – No, if Jay acted beyond the Shen?
scope of his authority. a. There are now two agents in the person
2nd answer – Yes, If Jay did not act beyond of Mharie and Shen.
the scope of his authority. b. The appointment of Shen does not
revoke the appointment of Mharie.
a. Only 1st is correct c. It has the effect of automatic
b. Only 2nd is correct revocation of the authority of
c. Both are correct Mharie.
d. Both are not correct d. The appointment of Mharie is revoked
only if notice is given too her.
73. Ping appoints Pong and Pang as his agents
solidarily to sell his specific property 79. Paw constituted Alz as his agent
for P200,000, on cash basis. Can Ping specifically fro the purpose of selling
hold Pang liable if Pong sell the Paw’s latest model Honda Civic Car.
property for P100,000? Instead of selling the said car, Alz sold
a. No, because Pong acted beyond the to Berg the Toyota Corolla of Paw. Berg
scope of his authority. is aware that the authority of Alz is to
b. No, because the appointment of the two sell the Honda Civic car, Paw did not
or more agents in one and the same ratify the contract. Which tie is
obligation is joint and any unenforceable?
stipulation to the contrary is void. a. The contract between Paw and Alz.
c. Yes, but only for P25,000 b. The contract between Alz and Berg.
d. Yes, because the obligation is c. The tie between Paw and Berg.
solidarily. d. None because both are void.

74. Agent is not extinguished by 80. Which of the following is not fundamental
a. Withdrawal of the agent. obligation of an agent?
b. Appointment of a substitute against a. To borrow if he is authorized to lend.
the prohibition of the principal
b. To subordinate his interest in favour forwarded to him by the owner until
of his principal if there is a the latter should appoint an agent.
conflict of interest.
c. To render an accounting of the 85. The principal is not liable to expenses
transaction. incurred by the agent
d. Not to carry out the agency, even if a. When it was stipulated that the agent
that is the instruction of the would only be allowed a certain sum.
principal, if he knew it would result b. When the agent has complied with his
to a loss or damage to his principal. obligations by acting according to
the principal instructions.
81. Statement 1: when two or more principals c. When the agent incurred them with the
have granted a power of attorney for a knowledge that an unfavourable result
common transaction or undertaking, would ensue and the principal was
anyone of them may revoke the same aware of it.
without the consents of the others. d. When the expenses were incurred
without the fault of the agent.
Statement 2: the agency is revoked if the
principal directly manages the business 86. The principal is liable to expenses
entrusted to the agent, dealing, incurred by the agent
directing with third persons. a. When the agent acted in contravention
of the principal’s instructions
a. True, True unless the latter should wish to avail
b. True, False himself of the benefits derived from
c. False, False the contract.
d. False, True b. When the expenses where due to the
fault of the agent.
82. Kim gave a general power of attorney to c. When an agent is employed by the
Song to sell his land. Thereafter, Kim principal and such agent incurred
executed a special power of attorney in expenses in the execution of the
favour of Park to sell the same land agency.
without Song’s knowledge. After five d. When the agent incurred them with
days, Song executed a deed of sale in knowledge that an unfavourable result
favour of Ong. After two hours, Park sold would ensue, if the principal was not
the same land to Wong. Assuming that the aware thereof.
documents have not yet been registered
and neither of the buyers has take 87. Troy appointed Trey thru a special power
possession of the land, which of the two of attorney as his agent ot sell his land
sales is valid and enforceable? for P500,000. The following day, Troy,
a. The sale to Ong because the sale to without notice to Trey, sold the land in
him is ahead by two hours. Sen who immediately took possession
b. The sale to Ong because the thereof. On the third day, Trey sold it
appointment of the agent seller to Ten who registered it in Registration
(Park) is ahead of the appointment of of Deeds. Assuming Sen and Ten are in
Kim. good faith.
c. The sale of Wong because the seller a. The land belongs to Sen because of his
is authorized by a special power of possession.
attorney. b. The land belongs to Ten because of the
d. The sale by Park because an authority registration.
t sell th eland requires only a c. Each of them shall be entitled to one-
general power of attorney. half of the total area of the land.
d. Sen is entitled to the land because
83. H appoints I as his agent giving I his seller is the principal and not
general powers to administer his riceland just a mere agent.
in Nueva Ecija and a coconut land in
Quezon, Subsequently, H appointed J, 88. Where two or more persons appointed an
another agent, to administer and sell the agent for a common transaction or
land situated in Quezon. Which of the undertaking, their liability to the agent
following statements is not correct? for all consequences of the agency is
a. The authority to I to administer the a. Solidary
property in Nueva Ecija is not revoked b. Joint
and shall continue. c. Subsidiary
b. There is an implied revocation of the d. Secondary
authority to administer the property
in Quezon but the authority to 89. Ham and Bacon are co-owners of a piece
administer the property in Nueva of land and they named and authorized
Ecija remains. Sandwich to sell their land. Who will
c. Both authorities will be revoked liable to Sandwich for the payment of his
because the agency with general commission?
powers is inseparable. a. Both Ham and Bacon jointly.
d. The authority of I to administer the b. Both Ham and Bacon solidarily only if
property in Quezon is impliedly stipulated.
revoked. c. Both Ham and Bacon solidarily without
stipulation.
84. One of the following is not an obligation d. 50% each for Ham and Bacon.
of an agent?
a. In the execution of the agency, the 90. Prax and Pro appointed Ave as their agent
agent shall act in accordance with the to sell their property. Prax alone
instructions of the principal. revoked the special power of attorney. Is
b. Shall be bound to advance the the agent revoked even without the
necessary funds, except when the consent of Pro?
principal is insolvent. a. No, otherwise anyone of them can
c. Shall finish the business already revoke agency without the knowledge
begun on the death of the principal, of the other.
should delay entail any danger. b. No, both principal should consent to
d. In case a person declaims an agency, the revocation of the agency.
he is bound to observe the diligence c. Yes, because Pro is superior over Pro.
of a good father of a family in the d. Yes, because it is a consequence of
custody and preservation of the goods solidarity between the principals.
91. No. 1: When two or more principals 2. A contract of pledge is
appoint an agent for a common transaction a. A real contract because it is
neither may revoke without the consent of perfected by the delivery of the thing
the other. pledged.
b. An accessory contract because it ha
No. 2: If the principal failed to pay the no independent existence of its own.
agent his commission, the latter may
retain the object belonging to the a. Only A
principal. b. Only B
c. Both A and B
a. Both are True d. Neither A nor B
b. Both are False
c. Only 1 is true 3. Which is not characteristic of pledge?
d. Only 1 is false a. Consensual
b. Accessory
92. The following are the instances when an c. Subsidiary
agency is not extinguished despite the d. Unilateral
revocation. Which is the exception??
a. When the agency is coupled with 4. No. 1: If the thing is returned to the
interest. pledgor, the principal obligation is
b. When a managing partner is dismissed extinguished.
as such without justifiable cause.
c. When the revocation is done in good No. 2: A contract of pledge is consensual
faith. which is perfected from the time the
d. When the agency is a means of thing pledged is placed in possession of
fulfilling an obligation. the creditor, or of a third person by
common agreement.
93. An agent with express power to sell
certain property, without beig aware of a. Both statements are false
the death of his principal, sold the b. Both statements are true
property after he death of his principal. c. Statement 1 true, statement 2 False
The purchaser, however, knew of the death d. Statement 1 False, statement 2 true
of the principal.
a. The contract is valid because the 5. One of the following is not a common
agent is in good faith. characteristic of pledge and mortgage?
b. The contract is not valid because the a. Consensual
agent is in bad faith. b. Accessory
c. The contract of agent is valid because c. Nominate
the knowledge of the death of the d. Onerous
principal does not make the purchaser
in bad faith. 6. Which of the following is not a common
d. The contract is not valid because the requisite to pledge and mortgage?
purchaser is in bad faith even if the a. Must be placed in the possession of
agent is in good faith. the creditor.
b. Accessory contract
94. X appointed Y to be his agent to c. Absolute owner of the property
administer his farm while X is in world d. Property may be alienated when
tour but Y died leaving his son of legal principal obligation become due for
age to take care of the farm until X the payment to the creditor.
arrived. This is an example of agency
created by 7. Which of the following is not an
a. Ratification essential requisite to pledge and
b. Estoppel mortgage?
c. Operation of Law a. Constituted to secure fulfilment of a
d. Consent of the Principal principal obligation.
b. Pledgor ot mortgagor must be the
95. NO. 1: if the agent dies, the heirs must absolute owner of the property.
notify the principal immediately and must c. Thing pledged or mortgaged must be
continue the objectives of the agency delivered to the creditor.
until it is accomplished or until the d. Thing pledged or mortgaged may be
principal has appointed a new agent. alienated.

No. 2: Agency by operation of law is 8. Pledge and mortgage are accessory


synonymous “presumed agency” or “tacit contracts. Which of the following
agency” statements is false?
a. They are meant to secure the
a. Both statements are true fulfilment of a principal condition.
b. 1st statement True while 2nd is False b. They cannot exist if the principal
c. Both statements are false obligation is void.
d. 1st statement False while 1st is True c. They can exist by themselves.
d. They can secure fulfilment of
rescissible obligation.
A. PLEDGE
9. The following are essential requisites
common to the contract of pledge and
1. An accessory real contract whereby one mortgage, except
person delivers to another a movable for a. That they are constituted to secure
the purpose of securing a principal the fulfilment of a principal
obligation, with the understanding that condition.
when the obligation is fulfilled the b. That the pledgor or mortgagor is the
thing shall be returned by the creditor absolute owner of the thing pledged
to the debtor together with all its or mortgaged.
fruits and accessions. c. That the contract is registered with
a. Real mortgage the Registration of Deeds.
b. Pledge d. That the person constituting the
c. Chattel Mortgage contract has free disposal of the
d. Antichresis
property and that he is authorized d. To bind a third person, it must be
legally for the purpose. recorded in the Office of the
Registration of Deeds.
10. Which of the following is a common
requisite for pledge, chattel mortgage 17. Diana borrowed P25,000 from Cris. As
and antichresis? security she pledged her choker which is
a. The amount of principal and interest made of gold and diamond. A public
must be in writing instrument was executed. The date of
b. The property must be in the possession pledge appears in the document but there
of the creditor. is no description of the jewelry
c. The bind third persons they must be a. The pledge is valid against third
duly recorded in the office of the persons because the date of pledge
Register of Deeds. appears in the public documents.
d. It is constituted to secure the b. The contract is valid as against third
fulfilment of a principal obligation. persons because it is written in a
public instrument.
11. The following contract is not valid as c. If Diana will sell the choker to
against the contracting parties. Estela, a third person, the latter
a. Mortgage which is not registered with does not have to respect the pledge
the Registration of Deeds. because it is not valid as to her.
b. Pledge which does not describe in a d. If Diana will sell the choker to
public document the thing pledged and Estela, Cris, the pledgee being in
the date of the pledge. possession, will have a better right
c. In a contract of pledge where there over Estela.
is no delivery of the movable.
d. Chattel mortgage which does not 18. Moon pledged his ring with Star. May Moo
contain affidavit of good faith. sell the ring to Cloud?
a. Yes, with the consent of Star.
12. Aten obtained a loan from Barra and b. Yes, without the consent of Star.
pledged the property of Canto as security c. No, even with the consent of Star.
with the consent of the latter. Whih is d. Yes, with the consent of Star who
not correct? shall then be required to turn over
a. There is no valid pledge if the the possession for Cloud.
property is not delivered to Barra.
b. The pledge is not valid if the debtor 19. To secure his loan to Sun, Princey
is not the owner of the property pledged his shares of stocks, Later,
pledged. Princey sold the said stocks to Momo who
c. In case of non-payment of loan, the now demands delivery of the stock
pledgee does not automatically become certification to him. Decide.
the owner of the property pledged. a. Momo, as a buyer has the right to
d. In case the property is sold at public demand delivery of the shared to
auction, Aten or Canto may bid. acquire ownership thereof.
b. Sun, as pledgee has the right not to
13. No. 1: Vinz borrowed P20,000 from Cath. surrender the certificate of shares
Can Lei, a third person, secure the debt to Momo and this will not invalidate
by pledging his own property? the sale of the shares.
c. Princey, has the right to the
No. 2: Play pledged to Toy his cow which possession of the stock certificate
is in the possession of Car. The cow was to Momo as owner of the shares.
not delivered to Toy. There was also no d. Both Sun and Momo have the right as
prohibition in the contract that Car was co-possessor.
by common consent made the depositary of
the property in Toy’s behalf. Is a 20. One of the following is a right of the
contract of pledge constituted by the pledgor
parties? a. Reimbursement for the preservation of
the thing pledged.
a. Yes, Yes b. Demand return of the thing pledged
b. Yes, No upon payment of the principal
c. No, No obligation.
d. No, Yes c. Recover or demand the thing pledged
against a third person.
14. Real property may be the object of d. Continue to have a lien on the thing
pledge. pledged even if it is alienated.

The thing pledged may be alienated by the 21. Which of the following is not an
pledgor. obligation of the pledgor?
a. To participate in the public auction
a. True, False of the thing pledged.
b. False, True b. To inform the pledge of the flaws, of
c. False, False the thing if known to him.
d. True, True c. To pay the principal obligation
including the interest, and expenses
15. Not a valid object of pledge in a proper case.
a. Certificates of Stocks d. To reimburse the pledgee for the
b. Stocks Dividends expenses incurred for the
c. Warehouse Receipts preservation of the thing pledged.
d. Timberland

22. Atilano borrowed P50,000 from Bobadilla


16. The following are the requisites of secured by a pledge of his diamond
pledge except necklace. Can Bobadilla retain the
a. The disposal of the property by the necklace until the debt is paid?
pledgor
b. Absolute ownership of the property Alaminos borrowed P20,000 from Binitay
pledged. payable in two months. As security,
c. The thing pledged may be placed in the Alaminos borrowed again P5,000 from
possession of a third person. Binitay. When the first debt fell due,
can Binitay retain the ring until the 28. D borrowed from B P10,000. D offered his
second debt is paid in full? right by way of pledged. It was expressly
stipulated that upon non-paymnet of the
a. Yes, No debt on time, the ring would belong to
b. Yes, Yes B. This forfeiture clause which has
c. No, Yes traditionally not been allowed, is called
d. No, No a. Pacto de retro
b. Pacto commissorio
23. The pledgee has a right to the c. Commodatum
reimbursement of the expenses for its d. Mutuum
preservation, and is liable for its loss e. None of the above
or deterioration
29. Which of the following does not
If through the negligence of the pledgee, distinguish pledge from real mortgage?
the thing pledged is in danger of being a. Constituted on personal property.
impaired, the pledgor may require the b. The property must be delivered to the
pledgee that the thing be deposited with creditor, or, try common consent, to
a third person. a third person.
c. Pactum commissorium is not allowed.
a. Yes, No d. Not valid against third persons if not
b. Yes, Yes registered.
c. No, Yes
d. No, No
30. Three of the following are considered
24. De Leon owes Candid P10,000. As a elements of contract of pledge and/or
security De Leon pledged his horse to mortgage. Which is the exception?
Candid. While in the possession o the a. Real contract
latter, the horse gave birth to a pony. b. Pledgor or mortgagor must be the
Who is entitled to the pony? absolute owner.
a. De Leon being the owner of the horse. c. Thing pledged may be appropriated if
b. Candid because the horse delivered a debtor cannot pay.
pony while in his possession. d. Pledfor or mortgagor must have a free
c. Candid and shall compensate the price disposal of the thing pledged.
of the pony with the expenses for the
care of the horse, the excess, is any, 31. A borrowed P50,0000 from B and offered
shall be applied to the principal. his land by way of a mortgage. If it is
d. De Leon shall be entitled to the pony stipulated in the contract that if A
but it shall be included as pledge in fails to pay the debt on time, B shall
the absence of stipulation. become the owner of the house. The
stipulation is
25. Rose pledged with Sampaguita her earring a. Valid if it had traditionally been
to secure her debt. The parties agreed allowed.
that after a month the thing pledged will b. Null and void because it is a pacto
be returned to Rose. comisorio
c. Void because it is equivalent to
Q 1: As agreed upon by the parties, the alienation of property in favour of
earrings was returned even when the the creditor.
principal obligation was not yet been d. Valid because the house would
paid. Has the pledge been extinguished? automatically serve as payment for
the land.
Q 2: Suppose after a month, Sampaguita
tried to return the earring but Rose did 32. YG borrowed P50,000 from JYP. As a
not accept. Sampaguita therefore security for the payment of the debt, YG
renounced the pledge by writing. Rose in pledged a rolex watch valued at P75,000.
a private document. Has the pledge been It was expressly stipulated in the
extinguished even if the object still in contract that if YG cannot pay his debt
the possession of Sampaguita? when it matures, the debtor shall
“execute a deed of absolute sale of the
a. Yes, No ring in favour of the creditor”. YG
b. Yes, Yes failed to pay the debt when it matured.
c. No, Yes a. JYP can now appropriate the watch
d. No, No because of the agreement stated in the
contract.
26. A stipulation whereby the pledgee or b. JYP cannot appropriate the watch
mortgagee automatically becomes the because it is pactum commissorium
owner of the thing pledged or mortgaged which is expressly prohibited by law.
is called c. The agreement is valid because it does
a. Pactum commissorium not constituted pactum commissorium.
b. Consolidation of ownership d. JYP cannot appropriate because it is
c. Conventional redemption obviously unfair on YG whose value of
d. Consignation the wristwatch is over and above the
amount of his debt.
27. The property which have been lawfully
pledged to a creditor cannot be pledged 33. The rule on pactum commissorium does not
to another as long as the first one apply to
subsists. a. Antichresis
b. Pledge
When the principal obligation becomes c. Real mortgage
due, the things in which pledge consist d. Commodatum
may be appropriated for the payment to
the creditor, if the debt is not paid in 34. Bulandus owes Rebamba the amount of
due time. P150,000. The debt is secured by a
certificate of time deposit with Banco
a. True, True Filipino in the amount of P100,000. When
b. True, False the debt matured, Rebamba informed the
c. False, False bank about the obligation of Bulandus and
d. False, True presented a letter that he be allowed to
exchange the certificate with cash. Can a. If at the first auction, the car is
the bank validly encash the certificate. not sold, Ctrl is allowed to
a. No, this is pacto commissorio which appropriate the thing for himself.
is prohibited by law. b. If at the first auction, the car is
b. Yes, because this alienation and not not sold, the pledgee should hold a
appropriation second auction and if the thing is not
c. No, because Bulandus would be sold, Ctrl may now appropriate the
prejudiced by P50,000 thing for himself.
d. Yes, it is not illegal for the c. At the public auction, Alt or Ctrl can
creditor to encash the time deposit bid.
certificate because the security is d. If the thing sold at the public
also money deposited in a bank. auction at a price more than the
principal obligation, interest and
35. Dionisio borrowed P20,000 from Cesario. expenses, the excess goes to Ctrl
Serafin acted as surely. To indemnify unless the contrary is provided.
Serafin in case he is obliged to pay the
debt. Dionisio pledged to the surety his 41. If the process of sale is more than the
jewelry. Dionisio failed top ay and so obligation, the creditor is entitled to
the surety paid Cesario P20,000 the excess unless otherwise stipulated,
a. Serafin can now appropriate the thing while if it is less the creditor cannot
pledged in his favour. recover the deficiency even if there is
b. If the jewelry is auctioned, any stipulation. This is applicable to
deficiency can be recovered from the a. Pledge
debtor. b. Chattel mortgage
c. The pledged is not valid because the c. Real estate mortgage
pledgee and the pledgor do not have a d. Mutuum
debtor-creditor relationship.
d. The jewlery can now be auctioned by 42. Derick promised to give Kim a particular
Serafin and the safe of the jewelry diamond ring if the latter will pass the
shall extinguish the principal October 2016 CPA Licensure Examinations.
obligation. Before the date of the examinations,
Derick pledged the ring to Erin to secure
36. It is also the essence of the contracts a loan. Kim passed the CPA examinations.
of the pledge and mortgage that when the a. Kim may get the diamond ring to Erin
principal obligation becomes due, the even if the debt is not due yet.
thing in which the pledge or mortgage b. Kim can never claim the diamond ring
consists may be from Erin because he is nor the owner
a. Appropriated by the creditor of the ring.
b. Disposed by the creditor c. Kim may get the diamond ring upon
c. Alienated by the creditor payment of the debt to Erin.
d. Deposited with the third person prior d. Kim can only claim the diamond ring
to foreclosure from Derick because Erin is not a
party to their agreement.
37. Which of the following is not a required
formality in an auction sale? 43. In sale of the thing pledged at the
a. The pledgor or owner and the pledgee public auction, which of the following
must bid. statement is not true or incorrect?
b. It must be made with the help of a a. The sale of the thing pledged
notary public. extinguishes the obligation.
c. The debt is already due but was not b. The pledgor or the owner has a better
paid on time. right if he should offer the same
d. Notice to the debtor and the owner of terms as the highest bidder.
the thing pledged before and after the c. If the price of the sale is less, the
public auction. pledgee is entitled to recover the
deficiency.
38. All of the following, except one, are d. If the price of the sale is more than
formalities required to effect a valid the principal, interest and expenses,
auction sale of the thing pledged. the pledgee may not be entitled to the
a. Debt is already due excess.
b. Intervention of a notary public
c. Payment of the principal debt 44. Effect of the sale of the thing pledged
d. Notice to debtor or owner stating the if it is less than the principal
amount for which the public sale is obligation:
to be held. a. Creditor cannot recover the
deficiency unless there is
39. In the first auction, there was no other obligation.
bidder except the creditor. A second b. Creditor can recover the deficiency.
auction was held c. Creditor can recover the deficiency
a. If there was still no other bidder in even if there is no stipulation
the second auction, the creditor can d. None of the above.
now appropriate the thing pledged.
b. If the pledgor bids and the term of 45. A, a minor sold ring to B for P4,000.
the offer is the same as the highest Later, B borrowed P6,000 from C and as
bidder, he shall have preference over security pledged the ring to C. B failed
the other. to pay C and the latter foreclosed the
c. If the pledgee bids and his offer is pledge, sold it at public auction for
the same as the pledgor, the P5,000 to X. As a result
pledgeee’s bid shll be given a a. The title of B is not valid, therefore
preferred right. the pledge of the ring to C is also
d. All bids, except that the plegdee, not valid because in pledge the
must be for cash. pledgor must be the owner.
b. The deficiency of P1,000 cannot be
40. Alt owes Ctrl P50,000 secured by a pledge recovered by C from B.
of his personal car. Unable to pay, Ctrl c. The deficiency of P1,000 can be
decided to sell the car in public recovered if there is stipulation to
auction. Which f the following is false? the effect.
d. If X is in bad faith (X has knowledge a. Yes, even without stipulation
that A, the original owner is a minor) b. Yes, if there is stipulation
ownership will not pass to him. c. No, even if there is stipulation
d. No, stipulation allowing recovery is
46. Ay pledged his car to Ber for a loan of void.
P500,000. The contract, stipulates that
in the case the property is sold at 52. No. 1: in conventional pledge, there is
public auction and the proceeds shall not no deficiency liability on the part of
be sufficient to pay the obligation, Ay the pledgor in spite of stipulation to
shall pay the balance of the loan. Unable the contrary.
to pay, Ber sold the car in a public
auction. It was sold ony for P300,000. No. 2: in pledge in operation by law, the
Can Ber recover the balance from Ay? excess of the proceed of the sale after
a. Yes, because of the stipulation in the foreclosure shall belong to the pledgor
contract. even in the absence of stipulation.
b. Yes, even if there is no stipulation
in the contract a. Only 2 is true
c. No, despite the stipulation in the b. Only 1 is true
contract. c. Both are false
d. No, unless there is a stipulation in d. Both are true
the contract.
53. Ava borrowed P300,000 from Eve and
47. Atutu pledged his necklace to Atoto for pledged her car to secure the loan. Ava
a loan of P50,000. Due to Atutu’s failure died living her child Cor, Duc and Est.
to pay his debt, Atoto sold the necklace Cor paid P100,000 to Eve.
in a public auction to Atata for P75,000. a. Cor can ask for extinguishment of the
Assuming that there is an agreement in pledge to the extent of one-third of
the contract that in case the proceeds the entire obligation.
shall exceed the loan, the debtor shall b. Cor should ask for refund because it
be entitled to the excess. Can Atutu was their parent who contracted the
recover the excess of P25,000? debt.
a. Yes, because of the agreement c. Cor has no right to pay the debt
b. Yes, even in the absence of an whether in full or in part.
agreement d. The pledge is not partially
c. No, despite the agreement extinguished because it is
d. No, whether or not there is an indivisible.
agreement.
54. Apu borrowed P100,000 from Bay. The first
48. Pale pledged his diamond ring with Quin P50,000 is secured by a pledge of Apu’s
to secure a loan of P15,000. The debt was car while the second P50,000 is secured
not paid on time, and a public auction by a pledge of his rolex watch. Apu paid
took place. Which statement is false? P50,000.
a. The pledgor is not disqualified to a. Apu can demand the return of his car.
offer a bid. b. Apu can demand the retrun either of
b. If the sale of price is P10,000 the his car or his rolex watch at his
deficiency shall be paid by the option.
pledgor. c. Apu cannot demand the return either
c. If the price at the sale is ore, the the car or his rolex watch because a
excess goes to the creditor unless the contract of pledge is indivisible.
contrary is proved. d. Apu can demand the return either of
d. If at the auction the pledgor should his car or his rolex watch at the
offer the same terms as the highest option of Bay.
bidder she should be given preference
over the other. 55. Abu borrowed P90,000 from Ban secured by
pledged of his platop computer worth
49. Which of the following statement P50,000 and secured by a pledge of his
regarding pledge is true? rolex watch worth P50,000. When the
a. The sale of the thing pledge shall balance of the debt was only P50,000. Abu
extinguish the principal obligation failed to pay.
provided the proceeds of the sale i a. Ban can sell either the laptop
equal to the amount of the principal computer or the watch at the option
obligation. of Bu.
b. If the price of the sale is more than b. Ban can sell either the laptop
the principal obligation, the debtor computer or the watch at his option.
shall be entitled to the excess, c. Ban has to sell both.
unless it is otherwise agreed. d. Ban has the option to sell either of
c. If the price of the sale is less than the two objects even if the contract
the principal obligation, the stipulates that he should sell only
creditor cannot recover the the watch.
deficiency, unless it is otherwise
agreed. 56. A owes B P5,000 and as security, A
d. If the price of the sale is more than pledged his diamond ring. Later, A
the principal obligation, the borrowed again P2,000. As a result.
creditor shall be entitled to the a. B has a right to retain the thing
excess, unless it is otherwise until the P7,000 is paid.
agreed. b. B has a right to retain the thing
until the P5,000 is paid.
50. A pledged his watch for P20,000. A failed c. A has a right to demand that the thing
to pay his obligation. B sold it in a be deposited with a third person.
public auction for P18,000. Can B recover d. B has the right to use the thing
the deficiency? pledged until the pledge effects
a. Yes, even without stipulation payment of the obligation.
b. Yes, if there is stipulation
c. No, even if there is stipulation 57. Should there be reasonable ground to fear
d. No, unless there is stipulation. the destruction or impairment of the
thing pledged, without the fault of the
51. Using the preceding number, if the sale pledgee, what is the obligation of the
is for P22,000. Can A recover the excess?
pledgee and what then is the right of the a. The property is delivered to the
pledgor? creditor
b. The subject matter is a real property
1st answer: the pledgee is bound to advise c. The creditor acquires the right to
the pledgor, without delay, or any danger receive the fruits of the property
to the thing pledge. d. The creditor is obliged to pay the
2nd answer: the pledgor can demand the taxes and charges upon the estate.
return which is of the same kind as the
former and not of inferior quality. 64. Real mortgage as distinguished from sale
a retro except
a. Both answers are correct a. Indivisible
b. Both answers are wrong b. No transfer of ownership
c. Only 1st answer is correct c. There is transfer of possession
d. Only 2nd answer is correct d. Applies only real property

58. On January 1, 2016, A borrowed P1M to B 65. Antonio borrowed one (1) kilo of shabu
payable on December 1, 2016. As a from Bayrante secured by a mortgage of
security therefore, A pledged his car to his land. What is the status of the
B with an agreement that B should use it. mortgage?
On June 30, 2016. A offered to pay the
loan in full and asked for the return of Amanto obtained a debt of P10,000 from
the car. Can A compel B to accept payment Busalla and mortgaged the coconut land
o the loan and return the car? owned by Cantoria in Quezon City without
a. A can compel to B to accept payment the knowledge of the owner. What is the
and return the car because the debtor, status of the mortgage?
A, not only does he have an obligation
to pay but also a right to pay. a. Valid, Void
b. Yes he can. Provided he makes the b. Valid, Valid
proper consignation of the money as c. Void, Valid’
payment with the court if B refuses d. Void, Void
to accept payment.
c. No, because the period is for the 66. Statement 1: A mortgages on real property
benefit of the creditor and he may is by itself a real property also
refuse advance payment.
d. No, because the creditor B can refuse Statement 2: in the absence of a
premature payment offered by debtor stipulation, a mortgage on the land will
A. include future houses that may be built
thereon.
59. A pledge his ring to F to secure a P10,000
obligation payable in two years. One year a. True, True
thereafter, F gives a note in writing to b. True, False
A stating that the debt not be secured c. False, False
and that A may get the ring back at her d. False, True
most convenient time. As a result
a. The principal obligation and the 67. Real estate mortgage
contract of pledge are both a. Has for its object movables as well
extinguished. as immovables
b. Only the principal obligation is b. Is perfected at the moment the
extinguished but not the contract of contract is registered with the
pledge because A did not get back the Registry of Property.
ring. c. Is inseparable because the mortgage
c. Both the principal obligations and directly and immediately subjects the
the contract of pledge are not property upon which it is imposed,
extinguished because A did not get whoever the possessor may be, to the
back the ring. fulfilment of the obligation for
d. The pledge is extinguished and F is whose security it was constituted.
constituted as s depository. d. Entitles the mortgage to the fruits
of the thing mortgaged.

B. REAL MORTGAGE 68. Not an essential requisite of a real


estate mortgage
a. Mortgage should have free disposal of
60. An accessory contract whereby real the property mortgaged, and the
property is made as security for the absence ithereof, he should be
faithful fulfilment of a principal legally authorized for the purpose.
obligation but the possession thereof is b. Subject matter of a contract must be
retained by the debtor. immovable property or alienable real
a. Real mortgage rights upon immovables.
b. Pledge c. Mortgagor is the absolute owner of the
c. Chatter mortgage property mortgaged.
d. Antichresis d. Constituted to secure the performance
of the principal obligation.
61. All of the following, except one, are
characteristics of a real mortgage 69. The mortgage instrument is not valid if
a. Indivisible not recorded in the Registry of Deeds.
b. Real right
c. Accessory Third persons with knowledge of the
d. Real contract existence of the mortgage are bound
because as to them, knowledge of a
62. The object is real property in registered mortgage is equivalent to
a. Pledge registration.
b. Chattel mortgage
c. Real estate mortgage a. True, True
d. Mutuum b. True, False
c. False, False
63. Similarity between real estate mortgage d. False, True
and antichresis
70. X borrowed money from Y and gave a piece balance of P120,000. Bae paid P80,000 of
of land as a security by way of mortgage. the debt.
It was agreed between the parties that a. The mortgage on either Bicol land or
upon nonpaymnet of the loan, the land Samar land cannot be cancelled.
would already belong to Y. If X failed b. The mortgage on both Bicol land and
to pay the debt, would Y now become the Samar land can be cancelled.
owner of the land? c. Only the mortgage on the land in Bicol
a. Y would become the owner because it can be cancelled.
was agreed upon by them based on the d. Only the mortgage on the land in Samar
principle of autonomy of contracts. can be cancelled.
b. Y would not become the owner because
the agreement that he would become the 76. The debtor-mortgagor may sell the
owner upon dealt of X is against the mortgaged property in third person
law. a. If there is no prohibition in the
c. Y would now become the owner but with contract.
right of redemption by X. b. Even if there is a stipulation in the
d. Y would not become the owner if X contract forbidding the owner from
annuls the voidable agreement. selling it.
c. Only if he duly authorized by the
71. When the mortgage is already due and mortgagee in writing.
remains unpaid, can the mortgagee d. Only if with the written consent of
appropriate the mortgaged property? the mortgagee.

1. No, the only right of the mortgagee 77. D mortgaged his land to C with the
is to foreclose the mortgage. stipulation that the former cannot sell
2. Yes, if there is a stipulation that his land before he has paid his loan to
the mortgagee can appropriate the C. D sold the land to X despite such
property. agreement. Which of the following is
correct?
a. Only 1st is True a. The contract of sale is void.
b. Only 2nd is True b. The consent of C is necessary before
c. Both are wrong D can sell the land.
d. Both are right c. The stipulation prohibiting sale of
the land is void.
72. Alay-ay borrowed P50,000 from Bevora d. The sale is valid if the buyer was not
secured with a mortgage of real property aware of the mortgage.
situated in Quezon City. The debt fell
due and was not paid. Assuming no mention 78. In a real estate mortgage, the mortgagor
was made in the contract on the natural can sell the mortgaged properly
accessions, improvements, or fruits, a. With the consent of the mortgagee in
which of the following rules is correct? writing.
a. All fruits which were harvested b. Even without the consent of the
during the pendency of mortgage mortgagee.
contract should accrue to the c. Only with the consent of the mortgagee
mortgagee. orally or in writing.
b. Pending fruits when the obligation d. None of the above.
becomes due are covered by the
contract of mortgage. 79. Alco mortgaged his house and lot in
c. The mortgage on the land should Quezon City to Bon. May Alco sell the
include future houses thereon, even house and lot to Cab?
if there is a stipulation to the a. No, otherwise the sale is void.
contrary. b. Yes, if there is no stipulation
d. Machinery temporarily removed from forbidding the owner from selling the
the mortgaged land is not included in mortgaged property.
the mortgage. c. No, if there is a stipulation
forbidding the owner from selling the
73. Alan and Bari are co-owners (in equal mortgaged property.
shares) of a parcel of land. May Bari d. Yes, even if there is a stipulation
mortgage his share in the property? forbidding the owner from selling the
a. Yes, but he should secure consent of mortgaged property.
his co-owner.
b. Yes, even without the consent of the 80. Cue mortgaged his house and lot to Barbie
co-owner. as collateral for the payment of his loan
c. No, because the contract or mortgage obligation. The mortgage contract
is indivisible stipulates that Cue cannot sell the
d. No, because the portion of the land property while the obligation exists.
owned by Bari is not identifiable. Before maturity of the mortgage, Dez
offered to buy the property from Cue.
74. Romeo and Juliet borrowed from a. Cue cannot sell the property to Dez
Shakespeare and mortgaged their co-owned unless he pays the loan obligation.
land. While the mortgage debt is pending, b. Cue can sell the property only if
Romeo and Juliet partitioned the property Barbie consents to it.
between them, and Juliet paid his share c. Cue cannot sell the property to Dez
of the land. because of the agreement not to sell
a. The mortgage on the land is the property to Dez.
extinguished. d. Cue can sell the property to Dez
b. The mortgage on Juliet’s share of the despite the stipulation in the
land is extinguished. mortgage contract not to sell.
c. The mortgage on Juliet’s share of land
is not extinguished. 81. Alonte mortgaged his land to Barbonio to
d. The mortgage on Shakespeare’s share obtain a debt of P100,000. Alonte then
of land is extinguished. sold the land to Cadores. When the debt
falls due, to whom should Barbonio demand
75. Bae borrowed a total sum of P200,000 from payment?
Baby, secured by a mortgage of a land in a. From Alonte only, the mortgagor.
Bicol for a debt of P80,000, and by a b. From Cadores only, the possessor.
mortgage on a land in Samar for the c. From Alonte and if he fails to pay,
from Cadores. If the latter does not
pay, the mortgaged may be foreclosed
and in case of deficiency, Cadores 1st A stipulation in a contract which
cannot be held liable fro such fixes a tipo or upset price, at which the
deficiency, even if there is a property will be sold at a foreclosure
stipulation to the contrary. proceeding.
d. From Alonte and if he fails to pay,
from Cadores. If the latter does not 2nd A stipulation forbidding the owner
pay, the mortgage may be foreclosed from alienating the immovable mortgaged.
and in case of deficiency, Carodes
cannot be held liable for such a. 1st only
deficiency, in the absence of a b. 1st and 2nd
contrary stipulation. c. 2nd only
d. Neither 1st nor 2nd
82. Bes bought from Sal a mortgaged property.
if the property is foreclosed because of 88. 1st statement: in all cases of
Sal’s failure to pay, who will be extrajudicial sale, the mortgagor may
responsible for the deficiency redeem the property at any time within
judgement? the term of one year from and after the
a. Bes date of registration of sale.
b. Bes even if he does not want to assume
the obligation. 2nd statement: in judicial foreclosure of
c. Sal if Bes does not want to assume the real estate mortgage, the general rule is
mortgage obligation. that the mortgagor cannot exercise his
d. Sal because the buyer does not right of redemption after the
generally assume the mortgaged confirmation of the sale by the court.
obligation.
a. Both are correct
83. In real estate mortgage, the following b. Both are wrong
rules are valid, except c. 1st is correct
a. A stipulation in the mortgage d. 2nd is correct
contract prohibiting the owner from
alienating the immovable mortgaged is
valid. C. CHATTEL MORTGAGE
b. The mortgagee may alienate the
mortgage credit or assign to a third
person in whole or in part. 89. Which of the following is not a source
c. Any stipulation allowing the mortgage of Chattel Mortgage Law?
creditor to appropriate the property a. Revised Penal Code
mortgaged is null and void. b. Civil Code
d. If alienated or mortgage credit is not c. Chattel Mortgage Law
registered, it is still valid between d. 1986 Constitution
the parties.
90. A contract by virtue f which personal
84. D mortgaged his land to C as security for property is recorded in the Chattel
the loan. Fearing foreclosure of the Mortgage Register as a security of the
mortgage due to his inability to pay the performance of an obligation.
loan, D sold the land to B without the a. Pledge
consent of C. Which is correct? b. Real Mortgage
a. The sale is void unless C can give c. Antichresis
another security. d. Chattel Mortgage
b. B cannot acquire ownership over the
land even if D delivers the land to 91. Personal properties that can be mortgaged
him. under the Chattel Mortgage Law
c. D cannot sell the land if there is an a. Shares of stocks
agreement prohibiting the mortgagor b. Ungathered fruits or products
from alienating the land. c. Interest in business
d. D can sell the land even without the d. All of the above
consent of C.
92. An oath in a contract of chattel mortgage
85. D borrowed P200,000 from C, and as wherein the parties severally swears that
security, he mortgaged his parcel of the mortgage is made for the purpose of
land. Unable to pay, foreclosed the securing the obligation specified in the
mortgage and sold it at a public auction. conditions thereof, and for no other
purpose, and that the same is a just and
Q1: Assuming that the land was sold for valid obligation, and one not 6entered
P150,000, can C collect the deficiency to into for the purpose of fraud is
D? a. Oath of affirmation
Q2: Assuming that the land was sold for b. Quaker Oath
P220,000, is C entitled to the excess? c. Oath of Office
d. Affidavit of good faith
a. Yes, Yes
b. Yes, No 93. A chattel mortgage is valid between the
c. No, No parties even without an affidavit of good
d. No, Yes faith.

86. Real estate mortgage as distinguished The mortgagee has the right to take
from pledge possession if the chattel mortgaged upon
a. The debtor is entitled to the excess dealt of the mortgagor
of the proceeds if stipulated.
b. The debtor shall not be entitled to a. True, True
the excess of the proceeds. b. True, False
c. The debtor is not entitled to the c. False, False
excess of the proceeds. d. False, True
d. The creditor cannot recover
deficiency. 94. May a leasehold improvement constructed
on a rented land be the subject of a
87. Which of the following stipulation is chattel mortgage?
void? a. No, if the mortgagor is lessee.
b. Yes, if the mortgagor is the lessor. failed to pay the indebtedness, despite
c. No, because a leasehold improvement demands made by Metrobank, the later
is a real property. instituted a collection suit to enforce
d. Yes, if the mortgagor and the payment of the P10,000 account.
mortgagee agree and no third persons Subsequently, Metrobank also filed
are prejudiced. foreclosure proceedings against Aban for
the security given for the account. Which
95. Ann borrowed P25,000 from Julie and of the following statement is false?
delivered her ring to Chace as security. a. If the amount realized in the auction
If the accessory contract is made orally sale is P15,000, Aban can collect from
it is a Metrobank the excess amount of
a. Chattel Mortgage P5,000.
b. Pledge b. If it is P9,000 etrobank, can collect
c. Real Mortgage from Aban the deficiency of P1,000.
d. Antichresis c. Metrobank can instituted an auction
for collection and at the same time
96. Which of the following statement is not foreclose the mortgaged propert.
correct? d. In letter (A), Aban can only collect
a. If the thing pledged will be returned the excess amount if there is an
by the pledgee, the contract of pledge stipulation to that effect.
is extinguished.
b. Any stipulation allowing the pledgee 102. S sold to B a specific car for
or mortgagee to appropriate the thing P20,000 payable in four equal
pledged or mortgaged is void. instalments, S delivered the car to B but
c. In case the creditor foreclosed the required B to mortgaged it back to S to
chattel mortgage, he cannot recover answer for the unpaid instalments. B paid
any deficiency in case the proceeds the 1st instalment, but the last three he
of the foreclosure sale are less than failed to pay. S foreclosed the mortgaged
the unpaid obligation. property and sold it at public auction
d. A public document containing a clear for P13,000.
and complete description of the a. S can recover from B the balance of
property mortgaged must be registered P2,000
in the Chattel Mortgage Register, b. S can recover from B the balance of
otherwise, the mortgage contract is P2,000 if there is stipulation to that
not valid. effect.
c. S cannot recover the deficiency
97. Aaron borrowed from Jiro and as security anymore even if there is stipulation.
for its payment of mortgaged his car to d. None of the above.
Chun. Upon failure to pay, Chun sold the
mortgaged chattel but the proceeds did 103. In case of foreclosure of the
not fully satisfy the secured debt. Can personal property mortgaged, where such
the mortgagee recover the deficiency from thing was previously sold to the buyer on
the mortgagor? an instalment basis and the proceeds of
a. No, the provisions on pledge the sale at public auction is less than
prohibiting recovery will apply. the personal obligation, can the seller
b. No, the provisions of Recto Law will recover the deficiency from the buyer?
apply.
c. Yes, there is no such prohibition 1st answer: no, the seller is not entitled
under the Civil Code although to recover the deficiency from the buyer.
prohibited under the Chattel Mortgage
Law. 2nd answer: yes, the seller is entitled to
d. Yes, there is no such prohibition recover the deficiency from the buyer.
under the Civil Code and the Chattel
Mortgage Law. a. Both answers are correct
b. Both answers are wrong
98. A mortgaged his car to B for P200,000. A c. Only 1st answer is correct
failed to pay his obligation. B sold it d. Only 2nd answer is correct.
at public auction for P180,000. Can B
recover the deficiency?
a. Yes, even without the stipulation - END -
b. Yes, only if there is stipulation
c. No, even if there is stipulation
d. No, unless there is stipulation

99. Using the preceding number, if the sale


is for P220,000, can A recover the
excess?
a. Yes, even without the stipulation
b. Yes, only if there is stipulation
c. No, even if there is stipulation
d. No, unless there is stipulation

100. Chattel mortgage as distinguished


from pledge
a. The excess over the amount due after
foreclosure goes to the debtor.
b. The sale of the object in an auction
extinguished the obligation.
c. The delivery of the personal property
is necessary.
d. The registration of the property in
the Registry of Property is
necessary.

101. Debtor Aban issued a promissory


note in the amount of P10,000 in favour
of Metrobank secured by mortgage of the
properties worth P30,000. When Aban