Civil Law

Long Quiz for Contracts and Special Contracts

(Good for 50 points)

1. On Septemenr 26, 2018, MTCL sent a letter-proposal for the delivery and sale of
computer hardware and equipment to Ace Foods to be installed at its various offices.
Aside from the itemization of the products offered for sale, the said proposal provided for
the following terms, viz: (1) Terms: 30 days upon delivery; (2) Validity: Prices are based
on current dollar rate and subject to changes without prior notice; (3) Delivery:
Immediate delivery for items on stock, otherwise 30 days to 40 days upon receipt of the
purchase order; and (4) Warranty: 1 year on parts and services. Accessories not included
in warranty.

On October 29, 2018, Ace Foods accepted MTCL’s proposal and accordingly issued
Purchase Order No. 100023 for the subject products amounting to P700,000.00.
Thereafter, on March 4, 2019, MTCL delivered the said products to Ace Foods as
reflected in its Invoice Receipt No. 23001. The fine print of the invoice states, among
others, that title to sold property is reserved in MTCL until full compliance of the terms
and conditions and payment of the price. After delivery, the subject products were then
installed and configured in Ace Food’s premises. MTCL, however, was left unpaid.

a. Distinguish a contract of sale from a contract to sell. (2.5%)

b. What is the nature of the contract between MTCL and Ace Food? (3%)

2. A Guard Service Contract was entered into by the BSP and Calida Security. It is
stipulated in the contract that Calida Security will provide protection to BSP’s properties
and premises. Because of the security in the BSP compound, several jeepney operators,
including Spouses Mamaril, would park their jeepneys every night thereon for a fee of
P300.00 per month for each unit.

One dark night, while these vehicles were parked inside the BSP compound, a male
person took one of the vehicles of Spouses Mamaril out of the compound. The security
guards, Cesario and Vicente, of Calida Security told the investigators that said person
looked familiar to them.

a. Did a contract of lease exist between Spouses Mamaril and BSP? Explain. (3%)
b. Spouses Mamaril filed a complaint for damages against BSP, Calida Security, and
guards Cesario and Vicente for the loss of their vehicle. Rule if BSP can be held
liable in the following bases: (1) stipulation pour autrui due to the Guard Service
Contract it entered with Calida Security; (2) principal-agent relationship which
existed between it and the security guards; and (3) vicarious liability. (6%)

3. To serve as security to his obligation, Cristina executed a real estate mortgage in favor of
Christine. However, the real estate mortgage was found to be forged and hence was
declared invalid by the court. Thus, Cristina no longer paid her obligations to Christine.
Is Cristina correct? Explain. (3%)

4. Distinguish in no more than 2 sentences. (15%)

a. Suretyship from guaranty.
b. Contract to sell from conditional contract of sale.
c. Pactum commissorium from dation in payment.
d. Commodatum from usufruct.
e. Subrogation from novation

5. Edgardo and Rosie were married on March 31, 1973 and are blessed with three children
namely: Christina, Peter, and Paul. One fine day, Edgardo entered into a Real Estate
Mortgage with Boston Equity whereby the former, representing himself as single,
 mortgaged six parcels of land, all of which belong to the conjugal partnership, to the
latter for P17 million at an interest of 4% within a period of six months. Parcels of land
registered under the name of Edgardo has a total land area of 4,533.60 square meters and
with a fair market value of P113 million.

However, Edgardo was unable to pay the same and thus prompted Boston Equity to send
a demand letter. Due to Edgardo’s failure to pay the amount demanded, Boston Equity
foreclosed the parcels of land.

a. Is the extrajudicial foreclosure sale valid? Explain. (4%)

b. Assume that extrajudicial foreclosure sale was invalidated. Can Boston Equity still
recover the loan? Explain. (2.5%)

6. Marie and Cory entered into a contract to sell involving a parcel of lot. However, Cory
found out that Marie is not the owner of the subject property after she paid half of the
purchase price already.

a. Can Cory filed for an action to rescind the contract to sell? (4%)
b. Suppose that while she paying the purchase price, she sold the lot to Christine. Two
years later, Cory also sold the same lot to Kristina. Is there double sale? Explain.
(4%)