~ STATISTICAL DATA OF THE BAR COVERAGE FOR COMMERCIAL LAW AT A GLANCE ~

A. ESSAY: BASIS: Lex Pareto 2010: [Essay topics for the past 18 years {1990-2008}] Percentage of Bar Coverage and Most Frequently Asked Topics for essay in order of frequency (Top 5 to 15 per topic)
WAREHOUSE RECEIPTS LAW: Instances where warehousemen are obligated to deliver; kinds; rights of persons to whom receipt has been transferred TRUST RECEIPTS LAW: Nature of trust receipts; remedies; obligation of the entrustee CORPORATION CODE: 23% Attributes of a corporation; power to declare dividends; corporate liquidation; pre-emptive rights; contents of articles of incorporation; ways to increase authorized capital stock; dealings of directors, trustees, or officers with the corporation; requisites of a derivative suit; doctrine of corporate opportunity; express powers of the corporation; power to acquire own shares; power to invest corporate funds in another corporation or business for any other purpose; certificate of stocks and transfer shares; stock corporation v. nonstock corporation; ultra vires acts and powers, liability, & removal of board of directors/trustees NEGOTIABLE INSTRUMENTS LAW: 18% Requisites of a negotiable instrument; rights and who is deemed a holder in due course; effect of forged signatures; check; liability of an accommodation party; rules where instrument is incomplete but delivered; omissions not affecting negotiability; negotiation; liability of maker, drawer, acceptor, indorser; effects of alteration of instrument; provisions not affecting negotiability; kinds of indorsement; bearer instrument; notice of dishonor; discharge of a negotiable instrument INSURANCE CODE: 12% Casualty Insurance; insurable interest in property insurance; rule for payment of claims where there is over-insurance by double insurance; right of the insurer to rescind a contract of life insurance; insurable interest in life insurance; designation of beneficiary; warranties; proper deviation; premium; double insurance; insurable interest of mortgagee and mortgagor; who may be insured; interest of a beneficiary; insurable interest in property; concealment SECURITIES & REGULATION CODE: 6% Transfer of jurisdiction of certain cases; insider; tender offer; liabilities of a person who violates the unfair use of inside information; manipulation of security prices and insider trading TRANSPORTATION LAW: 6% [Maritime Commerce]: Doctrine of limited liability; bill of lading; collision where both vessels are at fault; transhipment of goods; charter party; rescission of charter party and total rescission by owner; doctrine of inscrutable fault [Common Carrier]: Common carrier, defense of due diligence not available to a common carrier; liability for loss; presumption of negligence/available defenses; responsibility for acts of strangers and co-passengers; stipulation limiting carriers liability; presumption of negligence [Warsaw Convention]: Limitation of liability [COGSA]: Prescriptive period to file an action against the carrier for loss or damage [Public Service Act]: Requirements for the granting of a certificate of public convenience; unlawful act; revocation or sale of a certificate of public convenience BANKING LAWS: 6% R.A. 7653 NCBA: BSP; Receivership and liquidation; legal tender 1

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R.A. 8791 GBL: Foreclosure of real estate mortgage; restriction on bank exposure to DOSRI; prohibited transactions after the bank becomes insolvent; classes of banks; limits or restrictions on loan and credit accommodation R.A. 9160 AMLA: Definitions INTELLECTUAL PROPERTY CODE: 5% Copyrightable works; ownership of copyright and ownership of the commissioned work; remedies of the true and actual inventor; registrability of trademarks; infringement of trademark v. unfair competition; rights of authors as to his economic rights; limitations on copyright; patentable and non-patentable inventions; fair use doctrine; CHATTEL MORTGAGE LAW: Foreclosure of chattel mortgage; after-acquired properties; registration requirements to make chattel mortgage binding against third parties OTHERS: 13% (not all are included in the coverage) MARITIME COMMERCE LAW: 5 % (not included in the coverage) BULK SALES LAW: 3 % (not included in the coverage) INSOLVENCY: 2% (not included in the coverage) *********************************************************************

B. MCQS: BASIS: 2011 Bar Examination MCQs (100 items)

TOPIC Letters of Credit Warehouse Receipts Law Trust Receipts Law Negotiable Instruments Law Insurance Code Transportation Law Corporation Code Securities & Regulation Code Banking Laws Intellectual Property Code Real Estate Mortgage Law Chattel Mortgage Law Anti-Money Laundering Act TOTAL: LETTERS OF CREDIT: 0 WAREHOUSE RECEIPTS LAW: IIIII - 5 A. Nature & functions of a warehouse receipt: 1. To whom delivered: III B. Duties of a Warehouseman: I C. Warehouse lien: I TRUST RECEIPTS LAW: II - 2 A. Definition/concept of a trust receipt transaction: 1. Ownership of goods, docs. &instruments under a t.r.: I D. Remedies available: I NEGO. INSTRUMENTS LAW: IIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIIII - 36 A. Forms and Interpretation: 1. Requisites of Negotiability: IIIII 2. Kinds of Negotiable Instruments: II C. Rules of interpretation: I # OF TIMES 0 5 2 36 14 10 18 0 2 9 2 1 1 100


D. Signature: 1. Signature of agent: III 2. Forgery: IIII F. Accommodation Party: I G. Negotiation: 1. Kinds of indorsement: IIII H. Rights of the holder: II 1. Holder in due course: I 2. Defenses against the holder: III I. Liabilities of Parties: 1. Warranties: I 2. Acceptor: I K. Notice of dishonor: 1. Parties to be notified: I L. Discharge of Negotiable Instrument: I 1. Discharge of parties secondarily liable: I M. Material Alteration: 1. Effect of material alteration: III O. Presentment for acceptance: II INSURANCE CODE: IIIIIIIIIIIIII - 14 C. Characteristics/nature of insurance contracts: IIII D. Classes: 1. Marine: IIIII 2. Life: I E. Insurable Interest: 1. In property: I G. Rescission of Insurance Contract: 1. Concealment: II Insurance Company Structure: I TRANSPORTATION LAW: IIIIIIIIII - 10 A. Common Carriers: 1. Diligence required of common carriers: I B. Vigilance over the goods: 1. Delivery of goods to common carrier: I 2. Duration of liability (actual or constructive delivery): I C. Safety of Passengers: 1. Liability for acts of other passengers and strangers: I 2. Liability for acts of employees: I 3. Extent of liability for damages: I E. Maritime Commerce: 1. Exceptions to ltd. liability of shipowners & shipping agents: I 2. Carriage of Goods by Sea Act (COGSA) limitation of liability: I F. Public Service Act: 1. Requisites for citizenship: I 2. Fixing of rate: I CORPORATION CODE: IIIIIIIIIIIIIIIIII - 18 D. Corporate juridical personality: 1. Doctrine of piercing the corporate veil: I E. Capital structure: I 1. Minimum capital stock and subscription requirements: I 2. Corporate term: I F. Incorporation and organization: 1. Subscription contract: I 2. Adoption of by-laws (amendments): I G: Corporate Powers: 1. Consequences of ultra vires acts: I 2. Power to declare dividends: I H. Stockholders & members: 1. Proprietary rights: pre-emptive right: I 2. Proprietary rights: right of appraisal: II I. Board of Directors and Trustees: 1. Tenure, disqualifications & qualifications of directors: II 2. Elections (cumulative voting): I 3. Contracts between corporations w/ interlocking directors: I 4. Solidary liabilities for damages: I K. Dissolution and Liquidation: 1. Voluntary mode of dissolution: by shortening of corp. term: I L. Other Corporation: 1. Non-stock Corporation: I 2

2012 BAR EXAMS

SECURITIES & REGULATION CODE: 0 BANKING LAWS: II - 2 A. New Central Bank Act (R.A. 7653) 1. How the BSP handles banks in distress (receivership): I B. General Banking Act (R.A. 8791) 1. Bank powers & liabilities: I INTELLECTUAL PROPERTY CODE: IIIIIIIII - 9 B. Patents: 2. Limitations of patent rights: prior user: I C. Trademarks: 1. Trade names or business name: II 2. Well-known marks: I D. Copyright: 1. Non-copyrightable works: II 2. Rule on ownership of copyright: I 3. Copyrightable works (original works): I 4. Rights of copyright owners: I REAL ESTATE MORTGAGE LAW (ACT 3135 a.a. R.A. 4118): II - 2 1. Procedure: Need for republication in case of postponement: I 2. Remedies available to mortgagee upon default of mortgagor: I CHATTEL MORTGAGE LAW (ACT 1508): I - 1 1. Essential Requisites: I ANTI-MONEY LAUNDERING ACT (R.A. 9160 a.a. 9194): I - 1 1. Obligations of covered institutions: I *********************************************************************

C. SHORT LIST OF SOME PERTINENT PERIODS IN COMMERCIAL LAW:

SOME PERTINENT COMMERCIAL LAW PERIODS Period / Years Basis INSURANCE CODE: 1. Proceeds for Life a. Must be paid immediately Sec. 242, Insurance upon the maturity of the Insurance policy if there is a maturity Code date. b. If the policy matures upon the death of the insured, within 60 days after presentation of the claim and filing of the proof of death of the insured, 2. Property a. Proceeds must be paid Sec. 243, Insurance within 30 days after proof Insurance of loss is received by the Code insurer and ascertainment of the loss or damage is made either by agreement or by arbitration. 2. If no ascertainment is made within 60 days after receipt of proof of loss, the loss shall be paid within 90 days after such receipt. 3. Prescriptive Parties to an insurance Sec. 63, period of action contract may validly agree Insurance that an action on the policy Code should be brought within a limited period of time, provided that it is not less than 1 year from the time the cause of action accrues. If period is less than 1 year from the accrual of the cause of action, it is void.


2. If there is no stipulation or if the stipulation is void, action must be brought within 10 years for written contracts. Note: Prescriptive period begins from the date the insurer rejects the claim filed and not from the time of loss. 4. Compulsory Written notice of claim must Motor Vehicle be filed within 6 months Liability Insurance from the date of accident. Claim is deemed waived if not filed even if it is brought within 1 year from its rejection. 5. Suit for damages Must be filed within 1 year in insurance from the date of denial of contracts the claim by the insurer, whether filed in the proper court or with the Insurance Commissioner. TRANSPORTATION LAW: 1. Code of a. Notice of damage must be Commerce filed within 24 hours for Carriage of goods latent damage (Applicable to b. Prescriptive period: If domestic/internone provided, NCC applies. island/coastwise Written contract: 10 years transportation) Oral contract: 6 years c. Parties can stipulate shorter period for prescriptive period. 2. COGSA Carriage a. Notice of damage must be of goods filed within 3 days from (Applicable to delivery for latent damage international/over- b. 1 year from the date of seas/foreign delivery of the damaged transportation) goods. c. Parties cannot stipulate a prescriptive period shorter than 1 year. CORPORATION CODE: 1. Corporate Term 50 years unless sooner dissolved or extended. If extended, must not be made earlier than 5 yrs. prior to the original expiry date unless made with justifiable reasons as determined by the Securities and Exchange Commission. 2. Exercise of right Demand for payment must of appraisal be made within 30 days from the date the vote is taken. 3. Period of 3 years liquidation 4. Proxy period Not more than 5 years validity INTELLECTUAL PROPERTY CODE 1. Action for Must be commenced within Damages 4 years after committing the acts of infringement.

2012 BAR EXAMS

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Vda. De Gabriel v. CA, G.R. No. 103883, Nov. 14, 1996 Sec. 384, Insurance Code

D. INTELLECTUAL PROPERTY CODE POINTERS: [Based on the most frequently asked essay topics and mcqs) I. PATENTS: Non-patentable inventions [Sec. 22, IP Code]: The following shall be excluded from patent protection: 1. Discoveries, scientific theories and mathematical methods; 2. Schemes, rules, and methods of performing mental acts, playing games or doing business and programs for computers; 3. Methods for treatment of the human body; and 4. Plant varieties or animal breeds or essentially biological process for the production of plants and animals. Right to a patent [Sec. 28, IP Code]: belongs to the inventor, his heirs, or assigns. First to file rule [Sec. 29, IP Code]: if two or more persons have made the invention separately and independently of each other, the right to the patent shall belong to the person who filed an application for such invention, or where two or more applications are filed for the same invention, to the applicant who has the earliest filing date or the earliest priority date. Inventions created pursuant to a commission [Sec. 30.2, IP Code]: In case the employee made the invention in the course of his employment contract, the patent shall belong to the employee if the inventive activity is not a part of his regular duties even if the employee uses the time, facilities, and materials of the employer. Patent application [Sec. 32.2, IP Code]: No patent may be granted unless the application identifies the inventor. If the applicant is not the inventor, the office may require it to submit said authority. Grant of Patent [Sec. 50, IP Code]: The issuance of letter patent creates a presumption which yields only to clear and cogent evidence that the patentee was the original and first inventor. The burden of proving lack of novelty is on him who avers it and the burden is a heavy one which is met only by clear and satisfactory proof which overcomes every reasonable doubt. (Manzano v. Court of Appeals, G.R. No. 113388, September 5, 1997) Remedies of the true and actual inventor [Sec. 68, IP Code]: If a person who was deprived of the patent without his consent or through fraud is declared by final court order or decision to be the true and actual inventor, the court shall order for his substitution as patentee, or at the option of the true inventor, cancel the patent, and award actual and other damages in his favour if warranted by the circumstances. Defenses available for the defendant [Sec. 81 & 61, IP Code]: 1. Patent is invalid 2. Patent is not new or patentable; 3. Patent does not disclose the invention in a manner sufficiently clear and complete for it to be carried out by any person skilled in the art; or 4. Patent is contrary to public order or morality

Art. 366, Code of Commerce Art. 1144, Art. 1145, New Civil Code

Sec. 3 (6), COGSA Dole Phil. V. Maritime Co. No. L-61352, Feb. 27, 1997

Sec. 11, Corporation Code

Sec. 79, Intellectual Property Code


Tests for Patent Infringement: Literal infringement and the Doctrine of Equivalents: [Literal infringement] To determine whether the particular item falls within the literal meaning of the patent claims, the court must juxtapose the claims of the patent and the accused product within the overall context of the claims and specifications, to determine whether there is exact identity of all material elements. [Doctrine of Equivalents] Courts have also adopted the doctrine of equivalents which recognizes that minor modifications in a patented invention are sufficient to put the item beyond the scope of literal infringement. Thus, according to this doctrine, "an infringement also occurs when a device appropriates a prior invention by incorporating its innovative concept and, albeit with some modification and change, performs substantially the same function in substantially the same way to achieve substantially the same result." (Godines v. CA, G.R. No. 97343 September 13, 1993) Prior User in Good Faith Example [2011 MCQ]: X invented a device which can recharge a cellphone battery for which he applied for and was granted a patent effective within the Philippines. Y, however, also invented a similar device which he has been using in his cellphone business in Manila a year before the grant of Xs patent. X files an injunctive suit against Y to stop him from using the device on the ground of patent infringement. Such suit cannot prosper because Y is a prior user in good faith. II. COPYRIGHTS Original Works and Derivative Works [Sec. 172 & 173, IP Code]: Intellectual properties protected by the law on copyright: 1. Original Works 2. Derivative Works Original Works [2011 MCQ]: Under the IP Code, lectures, sermons, addresses or dissertations prepared for oral delivery, whether or not reduced in writing or other material forms, are regarded as original works. Economic Rights of the Author [ Sec. 177, IP Code]: Economic rights shall consist of the exclusive right to carry out, authorize, or prevent the following acts: 1. Reproduction of the work or substantial portion of it; 2. Dramatization, translation, adaptation, abridgment, arrangement or other transformation of the work; 3. First public distribution of the original and each copy of the work; 4. Rental of the original or a copy of an audio-visual or cinematographic work; 5. Public display of the original or a copy of the work; 6. Public performance of the work; and 7. Other communication to the public of the work. Scope of Moral Rights [Sec. 193.1, IP Code]: To require that the authorship of the works be attributed to him, in particular, the right that his name, as far as practicable, be indicated in a prominent way on the copies, and in connection with the public use of his work. Moral Rights [2011 MCQ]: are rights apart from economic rights which an author may transfer by way of assignment. The term of these moral rights shall last during the lifetime of the author and for 50 years after his death.
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2012 BAR EXAMS

Fair Use Doctrine [Sec. 185, IP Code]: Fair use of a copyrighted work for criticism, comment, news reporting, teaching including multiple copies for classroom use, scholarship, research and similar purposes is not an infringement of copyright. Limitations on Copyright [Sec. 184, IP Code]: [Only those which have been asked in the Bar Exams] The following acts, among others, shall not constitute infringement: 1. The recitation or performance of a work, once it has been lawfully made accessible to the public, if done privately and free of charge or if made strictly for a charitable or religious institution or society. [1994 Essay Bar Question] 2. Any use made of a work for the purpose of any judicial proceedings or for the giving of professional advice by a legal practitioner. [2006 Essay Bar Question] Situation: Lawyer writes legal opinion for a client about the difference between apprenticeship and learnership, quoting a labor law experts comment in his book without his permission. It is covered under the limitations. 3. Fair Use of a copyrighted work. [1998 Essay Bar Question] May a person have photocopies of some pages of the book written by a professor without violating copyright law? Yes. Private reproduction of a published work where the reproduction is made by a natural person exclusively for research and private study is permitted without the authorization of the owner of the copyright of the work. Commissioned Work [Sec. 178.4, IP Code]: In case of commissioned work, the creator (in the absence of a written stipulation to the contrary) owns the copyright, but the work itself belongs to the person who commissioned its creation. Copyright vis--vis Commissioned Artist [2004]: BR and CT are noted artists whose paintings are highly prized by collectors. Dr. DL commissioned them to paint a mural at the main lobby of his new hospital for children. Both agreed to collaborate on the project for a total fee of 2 million pesos to be equally divided between them. It was also agreed that Dr. DL had to provide all the materials for the painting and pay for the wages of the technicians and labourers needed for the work on the project. Assume that the project is completed and both BR and CT are fully paid the amount of 2 million pesos as artists fee by DL. Under the law on IP, who will own the mural? Who will own the copyright to the mural? Sec. 178.4 of the IP Code states that the creator owns the copyright in the absence of a written stipulation to the contrary, but the work itself belongs to the person who commissioned it. Thus, the mural belongs to DL. But BR and CT own the copyright, since there is no stipulation to the contrary. Non-copyrightable works [2011 MCQ]: 1. A new way of presenting a telephone directory in a mobile phone and which uses a lesser time for locating names and telephone numbers cannot be copyrighted because it is a mere system or method. Non-copyrightable works [2011 MCQ]: 2. X, an amateur astronomer, presented his findings about a massive volcanic eruption in Jupiter before the Association of Astronomers of the Philippines which was repeated in an article written by Y, a professional astronomer, and published in a science journal without any attribution to him. Y has not infringed on Xs


copyright because no protection extends to any discovery, even if expressed. Rules on ownership of copyright [2011 MCQ]: An associate attorney in a law firm who wrote a newspaper publisher a letter disputing a columnists claim about an incident in the attorneys family using the law firms letterhead and its computer in preparing the letter. He used the firms messenger to deliver the letter to the publisher. The associate attorney owns the copyright to the letter as he is the original creator of the contents of the letter. III. TRADEMARKS [1996 Bar Question] What is the distinction between an infringement of a trademark and unfair competition? 1. Infringement of trademark is the unauthorized use of a trademark, whereas unfair competition is the passing off of ones goods as those of another; 2. Fraudulent intent is unnecessary in infringement of trademark, whereas fraudulent intent is essential in unfair competition; 3. The prior registration of the trademark is a prerequisite to an action for infringement of trademark, whereas registration of the trademark is not necessary in unfair competition. (Del Monte Corporation et al v. CA et al, G.R. No. L-78325 January 25, 1990) [1996 Bar Question] Elements of Unfair Competition [Sec. 168, IP Code]: 1. There is the passing off of ones goods as those of another; 2. Fraudulent intent is essential; and; 3. Prior registration is not necessary. (Converse Rubber Corporation et al v. Jacinto Rubber and Plastics Co., Inc, G.R. Nos. L-27425 & L-30505 April 28, 1980) Certificate of Registration: A certificate of registration of a mark shall be prima facie evidence of the validity of the registration, the registrants ownership of the mark, and of the registrants exclusive right to use the same in connection with the goods or services and those that are related thereto specified in the certificate. The certificate of registration confers upon the trademark owner the exclusive right to use its own symbol only to those goods specified in the certificates, subject to the conditions and limitations stated therein. Thus, the exclusive right of petitioner in this case to use the trademark CANON is limited to the products covered by its certificate of registration, but cannot cover other types of products. Undoubtedly, paints, chemicals, toner and dyestuff are unrelated to sandals. (Canon Kabushiki Kaisha v. CA, G.R. No. 12090, July 20, 2000) Use of indications by third parties for purposes other than those for which the mark is used [Sec. 148, IP Code]: Registration of the mark shall not confer on the registered owner the right to preclude third parties from using bona fide their names, addresses, pseudonyms, a geographical name, or exact indications concerning the kind, quality, quantity, destination, value, place of origin, or time of production or of supply; of their goods or services; provided, that such use is confined to the purposes of mere identification or information and cannot mislead the public as to the source of the goods or services. Ex. Aling Sony using the business name Sonys Service Center falls under this provision.
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2012 BAR EXAMS

Test of Dominancy: Focuses on the similarity of the prevalent features of the competing trademarks which might cause confusion or deception and thus constitutes infringement. If the competing trademark contains the main or essential or dominant features of another, and confusion and deception is likely to result, infringement takes place. Duplication or imitation is not necessary; nor is it necessary that the infringing label should suggest an effort to imitate. The question at issue in cases of infringement of trademarks is whether the use of the marks involved would be likely to cause confusion or mistakes in the mind of the public or deceive purchasers. (Amigo Manufacturing v. Cluett Peabody Co., G.R. No. 139300, March 14, 2001) [2011 MCQ] T is the registered trademark owner of CROCOS which he uses on his ready-to-wear clothes. Banking on the popularity of Ts trademark, B came up with his own CROCOS mark, which he then used for his CROCOS burgers. T now sues B for trademark infringement but B argues that his product is a burger, hence, there is no infringement. Is B correct? No, since the owner of a wellknown mark registered in the Philippines has rights that extend even to dissimilar kinds of goods. [2011 MCQ]: Eagleson Refillers, Co. a firm that sells water to the public, opposes the trade name application of Eagleson Laundry, Co. on the ground that such trade name tends to deceive trade circles or confuse the public with respect to the water firms registered trade name. Will the opposition prosper? No, since the companies are not engaged in the same line of business. [2011 MCQ]: A, the proprietor of a fleet of ten taxicabs, decides to adopt, as his business name, A Transport Co., Inc.. May this be allowed? No, it would be deceptive since he is a proprietor, not a corporation.