LAW (Oblicon, Nego., Bus.

Org)

General Direction: Select the correct answer for each of the following questions. Mark only one answer for each item by
shading the box corresponding to the letter of choice on the answer sheet provided. STRICTLY NO ERASURES
ALLOWED. Use pencil in shading your answers. The exam has 70 points. You are given THREE (3) hours to answer all
the questions.
For Questions 1-5: Jeth was crossing Recto Avenue when he was accidentally bumped by a car driven by Andrew. Jeth
suffered minor injuries that required him to seek medical attention in a nearby hospital.
1. Jeth can file and action against Andrew and recover damages based on what ground/s?
a. Culpa Aquiliana only
b. Culpa Contractual only
c. Culpa Criminal and Culpa Aquiliana
d. Culpa Criminal and Culpa Contractual

2. Assuming the vehicle driven by Andrew is a Public Utility Vehicle (PUV) and one of the passengers, Anna was
likewise hurt because of the foregoing accident, what ground/s for damages can Anna file against Andrew?
a. Culpa Aquiliana only
b. Culpa Contractual only
c. Culpa Criminal and Culpa Aquiliana
d. Culpa Criminal and Culpa Contractual

3. Can Jeth file an action for damages on the basis of both Culpa Criminal and Culpa Aquiliana?
a. No, he can only file one because there is only a single cause of action and single legal basis for
damages
b. Yes, in fact he can recover civil damages on both actions
c. Yes, but there can be no double recovery of damages
d. No, because Jeth will be liable for forum shopping.

4. What kind of damages can the court award Jeth for the actual expresses that he incurred for hospitalization and
medical attendance provided he was able to present in court the receipts for his medical expenses?
a. Temperate damages
b. Moral damages
c. Liquidated damages
d. Actual damages

5. If Andrew is an employee of Mark, the owner of the car and employed of Andrew, would Mark be liable?
a. Yes, if action for damages based on culpa aquiliana is the case filed unless the defense of diligence
in the supervision and selection of employees can be raised by him
b. Yes, if culpa criminal is the basis of the case filed because he (Mark) is primarily liable
c. No, because Mark’s liability is only subsidiary
d. No in any case because Mark is not the one at fault

6. The principle of in pari delicto is applicable in

a. Both void and inexistent contracts
b. Neither void nor inexistent contracts
c. Void contracts but not in inexistent ones
d. Inexistent contracts but not in void ones

7. In case of payment of money or delivery of property by an incapacitated person, when may allow such person to
recover what he has paid or delivered?
a. The court can never allow such recovery
b. The court can allow as long as there is no objection
c. If the interest of justice so demands
d. If the parties agree to such recovery

1
8. The stages of contract of sale are the following, except:
a. Negotiation
b. Counter-offer
c. Perfection
d. Consummation

9. It shall be considered as part of the piece and as proof of the perfection of the contract
a. Option money
b. Initial payment
c. Downpayment
d. Earnest money

10. What is the importance of knowing whether a thing is determinate or generic?

a. To know concurrent obligations of the debtor
b. To know the rights and remedies of the creditor in case the debtor fails to comply
c. To know the consequences in case the thing is lost due to a fortuitous event
d. All of the above

11. Mike has a cow that produces milk. Mike bottles the milk and sells it weekly in the farmers’ market. He also makes
cheese and butter from such milk and sells them to his neighbors. The milk, cheese and butter are what kind of
fruits?
a. Industrial
b. Natural
c. Industrial or natural depending on the circumstances
d. Civil or industrial depending on the circumstances

12. Silvia borrowed money from Gener amounting to P55,000 with an agreement to return the said amount on August
31, 2018. If Silvia failed to return the said amount on the August 31, 2018, is she already in delay?
a. Yes, because there is a period given in the obligation
b. No, absent any demand either judicially or extrajudicially from the creditor
c. Yes, because time is of the essence of the contract
d. Yes because the obligation is a reciprocal obligation

13. What kind of obligation is created by the quasi-contract, negotiorum gestio?

a. The obligation to reimburse the inofficious manager for the expenses that he might have incurred
by taking over the property of another
b. The obligation to take over the property of another person without prior contractual agreement
between the parties
c. The obligation to pay damages
d. None of the above

14. In case of payment of any amount in excess of the maximum price of any article or commodity fixed by law, can
the buyer recover the excess?
a. No, as prohibited by law
b. No, as payment is made voluntarily
c. Yes, as allowed by law
d. Yes, in the interest of equity

15. A partnership borrowed P50,000 from Dick at clearly exorbitant and unconscionable interest. Can the creditor
recover anything from the debtor?
a. Yes, the creditor can recover the principal and legal interest
b. Yes, the creditor can recover the principal and the agreed interest
c. Yes, the creditor can recover the principal only
d. No, the creditor cannot recover anything since the interest is usurious

16. Sale of a thing with potential existence

a. Emptio reisperatae
2
 b. Emptio spei
c. Sale of a present thing
d. Void sale

17. An option is also sometimes called

a. Unacceptable offer
b. Accepted bid
c. Unaccepted bid
d. Accepted offer

18. Payment for honor as distinguished from acceptance for honor

a. The protest is for dishonor by non-payment
b. Consent of the holder is required
c. The bill is not overdue
d. Must not be a party already liable on the bill

19. A promissory note reads:

“ I promise to pay to the order of B P10,000, 30 days after the date”. Sgd. A
A issued the promissory note to B who indorsed it to C. Then X stole the note from C, forged the signature of C
and negotiated it to D and D to E and E to F, the holder.
Questions:
1. Can F collect from A on maturity?
2. If after giving the proper notice of dishonour to all parties secondarily liable, can F collect from B?
Answers:
1. Yes, because the signature of A is genuine and the instrument, as regards A was complete and delivered
2. Yes, as an indorser B warrants that the instrument is genuine and that it is valid and subsisting

a. Both answers are correct

b. Both answers are wrong
c. First is correct, second is wrong
d. First is wrong, second is correct

20. Using the preceding no.

Questions:
1. Can F collect from C? 2. Against whom can F collect?
Answers:
1. No, because C’s signature or indorsement was forged therefore it is wholly inoperative
2. F can collect from either D or E because their signatures are genuine and the instrument becomes operative
against them

a. Both answers are correct

b. Both answers are wrong
c. First is correct, second is wrong
d. First is wrong, second is correct

21. Acceptance of an offer made by the letter or telegram shall bind the offeror from the time the
a. Offeree accepted the offer
b. Offeree sent his letter or telegram
c. Acceptance came to the knowledge of the offeror
d. Offeror made the offer

22. When one exercises a right recognized by law, knowing that he thereby causes an injustice to another, the latter is
entitled to recover damages. This is known as the principle of
a. Res ipsa loquitur
b. Damnum absque injuria
c. Vicarious liability
d. Abuse of rights

23. Unless the law or the stipulation of the parties require another standard of care, every person obliged to give
something is also obliged to take care of it with the proper diligence
a. Observing utmost care
b. Observing extraordinary care
3
 c. Of a father of a good family
d. Observing ordinary diligence

24. Damages awarded for mental and physical anguish

a. Moral
b. Exemplary
c. Nominal
d. temperate

25. Debtor’s default in real obligation

a. Mora accipiendi
b. Mora solvendi ex-re
c. Mora solvendi ex persona
d. Compensation morae

26. When the debtor of a debtor is ordered not to pay the latter so that preference would be given to the latter’s creditor
a. Garnishment
b. Interpleader
c. Injunction
d. attachment

27. In a joint obligation, joints means any of the following except

a. Pro-rata
b. Proportionate
c. Moncomuunada simple
d. Individually and collectively

28. Instances where the law imposes solidary liability, except

a. Obligations arising from tort
b. Obligations of bailees in commodatum
c. Liability of principals, accomplices and accessories of a felony
d. Liability of partners arising out of a contract

29. Proof of pecuniary loss is necessary for the award of

a. Moral damages
b. Actual damages
c. Exemplary damages
d. Temperate damages

30. Not a requisite of cession in payment

a. One debtor and one creditor
b. Complete or partial insolvency
c. More than one debt
d. Abandonment of all debtor’s property not exempt from execution

31. A owes B P100,000 payable on or before June 20, 2021 while B owes A P100,000 payable on or before June 30,
2021. B can set up compensation on June 20, 2021 and this is called
a. Legal
b. Partial
c. Judicial or “set off”
d. facultative

32. A owes B P10,000. When the debt matured, B told A that she need not pay the debt since B is condoning it. A in
turn expressed her gratitude. The debt has been extinguished by
a. Novation
b. Compensation
c. Remission
d. Confusion

33. Using the preceding number, if A rejected the offer of B, and B did not collect within the statute of limitation (period
to collect) the debt may be said to have been extinguished by
a. Remission
b. Compensation
c. Prescription
d. Annulment

4
34. A makes a check payable to bearer and gives the check to C, who gives it to D who finally gives it to A. the
obligation of A is extinguished by
a. Merger
b. Compensation
c. Novation
d. Prescription

35. Alvin owes Bea P50,000. Alvin was not able to pay at the time the debt is due. Bea sued Alvin and subsequently
learned that a third person, Cindy, owes Alvin the same amount. The court issued an order of retention to Cindy. If
Cindy pays Alvin, is her obligation to Alvin extinguished?
a. Yes, provided all the elements of a valid payment are present
b. No
c. Depends if Cindy is in good faith or not
d. Yes, if Cindy will properly inform Bea

36. Which of the following obligation as a rule has retroactive effect?

a. Conditional obligation to give
b. Conditional obligation to do
c. Conditional obligation not to do
d. Obligation with a period

37. Statement I: unenforceable contract is less defective than a voidable contract

Statement II: the action to declare a void contract a nullity prescribes in four (4) years.
a. Both are true
b. Both are false
c. No. 1 is true, no. 2 is false
d. No. 1 is false, no. 2 is true

38. Which of the following contracts is not void ab initio?

a. That whose subject is outside the commerce of men
b. That whose subject did not exist at the same time of transaction
c. That which contemplates an impossible service
d. That which is undertaken is fraud of creditors

39. Which of the following is not correct about limited partnership?

a. Limited partnership consists of at least one general partner and at least one limited partner.
b. To forma a limited partnership, there must be a sworn certificate which comply all the
requirements set forth by law and field with Securities and Exchange Commission.
c. The limited partnership is void if one of the partners contributes an immovable property and there
is no inventory of the real property attached to the public instrument
d. If the partnership name of a limited partnership has no “Ltd” or “limited”, the partnership is a non-
existing partnership

40. The following are all grounds for a judicial decree of dissolution except:
a. Where a partner is guilty of such conduct as tends to prejudicially affect the partnership
b. When the business can only be carried at a loss
c. By any event which makes it unlawful for the partnership to carry on the business
d. Where a partner is rendered incapable of performing his part of the agreement

41. A partners’ interest in specific partnership property is:

Assignable to the Subject to attachment
partner’s individual by the partner’s
creditors individual creditors
a. Yes Yes
b. Yes No
c. No Yes
d. No No

42. A, B and C solidarily owe W and Y, solidary creditors P24,000, where the share of the debtors is 2:3:5 while the
creditors is 1:2. The terms of the contract provide:
1. A will pay if Y will pass the May 2014 CPA Board Exams
2. B will pay on June 10, 2014
3. C will pay on January 15,2 014
5
 On January 15, 2014, W can collect from
a. A = P24,000
b. B = P12,000
c. C = P24,000
d. C = P 8,000

43. Using the above data, the debtor who effected payment is entitled to get reimbursement from
a. B = P12,000
b. A = P12,000
c. C = P12,000
d. A or B = P12,000

44. Assuming Y passed the May 2014 CPA Board Exams, Y can collect from
a. A or C = P16,800
b. B = P 4,800
c. A = P12,000
d. A or B or C = P12,000

45. Which is the effect of the loss of the prestations in an alternative obligation where the right of choice belongs to the
creditor and the loss is due to fortuitous event?
I. if only one remains, the obligation still subsists, but it ceases to be alternative as it becomes a simple
obligation
II. if two or more objects remain, the obligation still subsists, retaining its alternative character
III. if none remains, the obligation is extinguished

a. I and II
b. I and III
c. II and III
d. I, II and III

46. The defendant in a criminal case for physical injuries arising from tort died before final judgment. Is his civil
a. Yes, because death extinguishes personality
b. No, the action will be directed against the administrator of his estate
c. Yes, because the defendant will be deprived of due process of law
d. No, the action will be directed against the creditors of his estate

47. This is a characteristic of a stock corporation as distinguished from a non-stock corporation

a. The powers are vested in the Board
b. The owners can be declare dividends
c. It is formed by at least 5 but not more than 15 persons
d. It is organized for profit

48. When a corporation is used to defeat public convenience, justify wrong, protect fraud, or defend crime or made as
a shield to confuse the legitimate issues or where a corporation is a mere alter ego or business conduit of a person,
this doctrine applies
a. Doctrine of business opportunity
b. Trust fund doctrine
c. De facto doctrine
d. Doctrine of piercing the veil of corporate fiction

49. A certificate of stock is distinguished from share of stock in that a share of stock
a. Is the written evidence of a stockholder’s interest in the assets and management of a corporation
b. Is tangible personal property
c. Is one of the units into which the capital stock is divided
d. May not be issued if the subscription has not been duly paid

50. In no case shall the total yearly compensation of directors, as such directors, exceed
a. 5% of the net income before income tax during the preceding year
b. 10% of the net income before income tax during the preceding year
c. 10% of the net income after income tax during the preceding year
d. 10% of the net income before income tax during the current year

6
51. As regards to treasury shares, which is not correct?
a. They have no voting rights as long as they remain in the treasury.
b. They are considered as part of earned or surplus profits and therefore distributable as dividends.
c. They are not entitled to dividends of assets.
d. They may be distributed as property dividend if there are retained earnings arising from the
business of the corporations.

52. Rules of action adopted by the corporation for its internal government and for the government of its officers and of
its stockholder are members
a. Contract
b. Articles of Incorporation
c. Ultra vires act
d. By-laws

53. An action brought by a stockholder against the corporation for direct violation of his contractual rights
a. Individual suit
b. Derivative suit
c. Representative suit
d. Corporate suit

54. One of the following acts maybe performed by the executive committee of a corporation. Which is it?
a. Declaration of stocks dividends
b. Filling of vacancies in the board of directors
c. Amendment or repeal of the by-laws or adoption of new by-laws
d. Approval of contracts in the ordinary course of business

55. A and B orally agreed to form a partnership two years from today, each one to contribute P1,000. If at the arrival
of the period, one refuses to go ahead with the agreement, can the other enforce the agreement?
a. Yes, because the partnership contract is not governed by the Statute of Frauds
b. Yes, because the prior agreement was voluntarily made
c. No, because the agreement was merely oral and executory
d. No, since the agreement is to be enforced after one year from the making thereof, the same should
be in a public instrument to be enforceable

56. Three (3) of the following are rights of a partner. Which one (1) is not?
a. Right to associate another person to his share
b. Right to admit another person
c. Right to inspect and copy partnership books
d. Right to ask dissolution of the firm at the proper time

57. P authorized A, a minor, to sell his car for P 1,000,000 in cash. A sold the said car to X on installment at a lesser
price of P 900,000. P is now repudiating the contact with X on the ground that he is not bound to since X contracted
with a minor who exceeded his authority. Decide.
a. P is liable under the contract because it is enough that the principal is capacitated since he
is the one entering into the contract.
b. P is not liable for the sale on installments since it is unenforceable because his agent acted
beyond his powers.
c. P is not liable because the agent is a minor with whom X contracted
d. P is liable provided the sale is in cash for P 1,000,000.

58. One of the following is not a characteristic of contract of partnership.

a. Real, in that the partners must deliver their contribution s in order for the partnership
contract to be perfected.
b. Principal, because it can stand by itself.
c. Preparatory, because it is a means by which other contracts will be entered into.
d. Preparatory, because it is a means by which other contracts will be entered into.

59. Which is not negotiable?

a. Pay to B or order P1,000 thirty days after sight. Sgd. A to C
b. I promise to pay B or order P1,000 on or before March 2016. Sgd. A
c. I promise to pay B or order P1,000 within 20 days after the death of C. Sgd. A
d. Pay to B or order P1,000 within 10 days if he marries D on June 12, 2016. Sgd. A to C

60. Which of the following statements is correct?

7
 a. If the maker is an infant, the promissory note is not negotiable
b. Love and affection can be a valid consideration
c. Indorsement of an infant transfers title to a negotiable instrument
d. Parties prior to the infant can escape liability by invoking such infancy

61. Statement I: there is no delay in an obligation not to do something

Statement II: solution indebiti and negotiorum gestio are implied contracts
a. True, true
b. True, false
c. False, true
d. False, false

62. The buyer has the right to the fruits of the thing from the time
a. The thing is delivered
b. The fruits are delivered
c. The obligation to deliver the thing arises
d. The sale is perfected

63. Waldo obliged himself to deliver to Allan the following:

1. His HP Pavilion i5 Laptop
2. Ford Ranger car with plate number WAD 364
1 statement – In case Waldo failed to deliver the laptop, the court may compel him to deliver one
st

2nd statement – In case Waldo failed to deliver the car, the court may compel him to deliver another car plus damages
a. True, true
b. True, false
c. False, true
d. False, false

64. Mr. Reyes owes Mr. Cruz, P500,000 payable on Jan. 31, 2018. Which of the following is correct?
a. If Mr. Reyes dies before Jan. 31, 2018, Mr. Cruz cannot collect from the heirs of Mr. Reyes
b. If Mr. Reyes dies before QJan.31,2018, Mr. Cruz can collect from the heirs of Mr. Reyes
c. If Mr. Cruz dies his heirs cannot recover from Mr. Reyes
d. If both Mr. Reyes and Mr. Cruz die, the heirs of Mr. Cruz can collect from the heirs of Mr. Reyes.

65. Kokoy obliged himself to give to Biboy his brand new fossil watch if the latter cannot circle that is at the same time
a square.
a. The obligation is unenforceable because the condition is immoral.
b. The obligation is void because of the positive impossible condition.
c. The obligation is valid because of the impossible condition is negative.
d. The obligation is void, not enforceable.

66. Case No. 1. Henry promised to give his son a car if the son will marry Herlyn this year, if by the end of the year,
Herlyn is already dead or the son has not married Herlyn, the obligation give a car is effective and demandable.
Case No. 2. Henry promised to give his son a car if the son will not marry Herlyn bef3ore the end of 2018. If on
January 1, 2011, the son has not yet married Herlyn, or Herlyn has died, the obligation is extinguished.
a. Both statements are false.
b. First false, second true.
c. Both statements are true
d. First true, second false.

67. “do ut facias” means:

a. I give and you give
b. I give and you do
c. I do and you give
d. I do and you do

68. Which of the following is not considered as quasi-contract?

a. Solutio indebiti
b. When in fact the manager has been tacitly authorized by the owner
c. Negotiorum gestio
d. Reimbursement due the person who saved from destruction the property during fire or storm
without knowledge of the owner

69. A natural obligation under the New Civil of the Philippines is one which
a. The obligor has a moral obligation to do, otherwise entitling the oblige to damages

8
 b. Refers to an obligation in writing to do or not to do
c. The oblige may enforce through the court if violated by the obligor
d. Cannot be judicially enforced but authorizes the oblige to retain the obligor’s payment performance

70. The following are examples of real contracts, except

a. Commodatum
b. Mutuum
c. Donation
d. Pledge

GOOD LUCK and GOD BLESS !!!!