Bar Exams Questions

1990-2016
OBLIGATIONS AND CONTRACTS
1991
Period; Suspensive Period
In a deed of sale of a realty, it was stipulated that the buyer would
construct a commercial building on the lot while the seller would construct a
private passageway bordering the lot. The building was eventually finished but
the seller failed to complete the passageway as some of the squatters, who
were already known to be there at the time they entered into the contract,
refused to vacate the premises. In fact, prior to its execution, the seller filed
ejectment cases against the squatters. The buyer now sues the seller for specific
performance with damages. The defense is that the obligation to construct the
passageway should be with a period which, incidentally, had not been fixed by
them, hence, the need for fixing a judicial period.
Will the action for specific performance of the buyer against the seller prosper?

Peralta, Francis A.
1991
Nature of Contracts; Obligatoriness
Roland, a basketball star, was under contract for one year to play-
for-play exclusively for Lady Love, Inc. However, even before the basketball
season could open, he was offered a more attractive pay plus fringes
benefits by Sweet Taste, Inc. Roland accepted the offer and transferred to
Sweet Taste. Lady Love sues Roland and Sweet Taste for breach of contract.
Defendants claim that the restriction to play for Lady Love alone is void,
hence, unenforceable, as it constitutes an undue interference with the right
of Roland to enter into contracts and the impairment of his freedom to play
and enjoy basketball.
Can Roland be bound by the contract he entered into with Lady Love
or can he disregard the same? Is he liable at all? How about Sweet Taste? Is
it liable to Lady Love?
Peralta, Francis A
1992
Liability; Solidary Obligation
In June 1988, X obtained a loan from A and executed with Y as solidary co-
maker a promissory note in favor of A for the sum of P200,000.00. The loan
was payable at P20,000.00 with interest monthly within the first week of each
month beginning July 1988 until maturity in April 1989. To secure the
payment of the loan. X put up as security a chattel mortgage on his car, a
Toyota Corolla sedan. Because of failure of X and Y to pay the principal
amount of the loan, the car was extrajudicially foreclosed. A acquired the car
at A's highest bid of P120,000.00 during the auction sale. After several
fruitless letters of demand against X and Y, A sued Y alone for the recovery of
P80.000.00 constituting the deficiency. Y resisted the suit raising the following
defenses:
Banares, Jay Vangil M.
1992
Liability; Solidary Obligation
a) That Y should not be liable at all because X was not sued together with Y.
b) That the obligation has been paid completely by A's acquisition of the car
through "dacion en pago" or payment by cession.
c) That Y should not be held liable for the deficiency of P80,000.00 because
he was not a co-mortgagor in the chattel mortgage of the car which
contract was executed by X alone as owner and mortgagor.
d) That assuming that Y is liable, he should only pay the proportionate sum
of P40,000.00. Decide each defense with reasons.

Banares, Jay Vangil M.

1993
Extinguishment; Loss; Impossible Service

In 1971, Able Construction, Inc. entered into a contract with Tropical

Home Developers, Inc. whereby the former would build for the latter the houses
within its subdivision. The cost of each house, labor and materials included, was
P100,000.00. Four hundred units were to be constructed within five years. In
1973, Able found that it could no longer continue with the job due to the
increase in the price of oil and its derivatives and the concomitant worldwide
spiraling of prices of all commodities, including basic raw materials required for
the construction of the houses. The cost of development had risen to
unanticipated levels and to such a degree that the conditions and factors which
formed the original basis of the contract had been totally changed. Able brought
suit against Tropical Homes praying that the Court relieve it of its obligation. Is
Able Construction entitled to the relief sought?

Mula, Iane Gem M.

1994
Extinguishment of Obligation; Loss

Dino sued Ben for damages because the latter had failed to deliver the
antique Mercedes Benz car Dino had purchased from Ben, which was, by
agreement, due for delivery on December 31, 1993. Ben, in his answer to
Dino's complaint, said Dino's claim has no basis for the suit, because as the
car was being driven to be delivered to Dino on January 1, 1994, a reckless
truck driver had rammed into the Mercedes Benz. The trial court dismissed
Dino's complaint, saying Ben's obligation had indeed, been extinguished by
force majeure. Is the trial court correct?

Mau Rine
1995
EXTINGUISHMENTS: PAYMENT

In 1983 PHILCREDIT extended loans to Rivett-Strom Machineries, Inc.

(RIVETTT-STROM), consisting of US$10 Million for the cost of machineries
imported and directly paid by PHTLCREDIT, and 5 Million in cash payable in
instalments over a period of ten (10) years on the basis of the value thereof
computed at the rate of exchange of the U.S. dollar vis-à-vis the Philippine peso
at the time of payment. RIVETT-STROM made payments on both loans which if
based on the rate of exchange in 1983 would have fully settled the loans.

Lauron, Rodel
1995
EXTINGUISHMENTS: PAYMENT

PHILCREDIT contends that the payments on both loans should be based

on the rate of exchange existing at the time of payment, which rate of
exchange has been consistently increasing, and for which reason there would
still be a considerable balance on each loan. Is the contention of PHILCREDIT
correct? Discuss fully.

Lauron, Rodel
1995
QUASI-CONTRACTS; NEGOTIORUM GESTIO

Armando owns a row of residential apartments in San Juan, Metro

Manila, which he rents out t tenants. On 1 April 1991 he left for the United
States without appointing any administrator to manage his apartments such
that uncollected rentals accumulated for three (3) years. Amparo, a niece of
Armando, concerned with the interest of her uncle, took upon herself to
administer the property. As a consequence, she incurred expenses in collecting
rents and in some instances even spent for necessary repairs to preserve the
property.
What juridical relation between Amparo and Armando, if any, has resulted
from Amparo’s unilateral act of assuming the administration of Armando’s
apartments? Explain.

Raquel, Marlon B.
1996
NATURE OF CONTRACTS; PRIVITY OF CONTRACTS

Baldomero leased his house with a telephone to Jose. The lease contract
provided that Jose shall pay for all electricity, water and telephone services in
the leased premises during the period of the lease. Six months later. Jose
surreptitiously vacated the premises. He left behind unpaid telephone bills for
overseas telephone calls amounting to over P20,000.00. Baldomero refused to
pay the said bills on the ground that Jose had already substituted him as the
customer of the telephone company. The latter maintained that Baldomero
remained as his customer as far as their service contract was concerned,
notwithstanding the lease contract between Baldomero and Jose. Who is
correct, Baldomero or the telephone company? Explain.

Mones, Catherine
1996
RESCISSION OF CONTRACTS; PROPER PARTY
In December 1985, Salvador and the Star Semiconductor Company (SSC)
executed a Deed of Conditional Sale wherein the former agreed to sell his 2,000
square meter lot in Cainta, Rizal, to the latter for the price of P1,000,000.00,
payable P100,000.00 down, and the balance 60 days after the squatters in the
property have been removed. If the squatters are not removed within six
months, the P100,000.00 down payment shall be returned by the vendor to the
vendee, Salvador filed ejectment suits against the squatters, but in spite of the
decisions in his favor, the squatters still would not leave.

Mones, Catherine
1996
RESCISSION OF CONTRACTS; PROPER PARTY
In August, 1986, Salvador offered to return the P100,000.00 down
payment to the vendee, on the ground that he is unable to remove the
squatters on the property. SSC refused to accept the money and demanded that
Salvador execute a deed of absolute sale of the property in its favor, at which
time it will pay the balance of the price. Incidentally, the value of the land had
doubled by that time. Salvador consigned the P 100,000.00 in court, and filed an
action for rescission of the deed of conditional sale, plus damages. Will the
action prosper? Explain.

Mones, Catherine
1997
CONDITIONAL OBLIGATIONS; PROMISE
In two separate documents signed by him, Juan Valentino "obligated"
himself each to Maria and to Perla, thus - 'To Maria, my true love, I obligate
myself to give you my one and only horse when I feel like It." - and -'To Perla, my
true sweetheart, I obligate myself to pay you the P500.00 I owe you when I feel
like it." Months passed but Juan never bothered to make good his promises.
Maria and Perla came to consult you on whether or not they could recover on
the basis of the foregoing settings. What would your legal advice be?

Sta. Ana, Ronald

1998
OBLIGATIONS
Joey, Jovy and Jojo are solidary debtors under a loan obligation of
P300.000.00 which has fallen due. The creditor has, however, condoned Jojo’s
entire share in the debt. Since Jovy has become insolvent, the creditor makes a
demand on Joey to pay the debt.

1. How much, if any, may Joey be compelled to pay?

2. To what extent, if at all, can Jojo be compelled by Joey to contribute to such
payment?

Guarte, Ma. Isabel M.

1998
OBLIGATIONS
VII.
(a) Define alternative and facultative obligations.
(b) Define joint and solidary obligations.

<name>
1998
CONTRACTS

IV. Distinguish consensual from real contracts and name at least four (4) kinds of
real contracts under the present law.

<Name>
1999
In 1997, Manuel bound himself to sell Eva a house and lot which is being
rented by another person, if Eva passes the 1998 bar examinations. Luckily for
Eva, she passed said examinations.
(a) Suppose Manuel had sold the same house and lot to another before Eva
passed the 1998 bar examinations, is such sale valid? Why?

Rivera, Ronald
1999

(b) Assuming that it is Eva who is entitled to buy said house and lot, is she
entitled to rentals collected by Manuel before she passed the 1998 bar
examinations? Why?

Rivera, Ronald
2000 CONDITIONAL OBLIGATION
Pedro promised to give his grandson a car if the latter will pass the bar
examinations. When his grandson passed the said examinations, Pedro refused
to give the car on the ground that the condition was a purely potestative one.
Is he correct or not?

Gatpolintan, Mariel
2000
LOSS OF THE THING DUE
Kristina brought her diamond ring to a jewelry shop for cleaning. The
jewelry shop undertook to return the ring by February 1, 1999. When the said
date arrived, the jewelry shop informed Kristina that the job was not yet
finished. They asked her to return five days later. On February 6, 1999, Kristina
went to the shop to claim the ring, but she was informed that the same was
stolen by a thief who entered the shop the night before. Kristina filed an action
for damages against the jewelry shop which put up the defense of force
majeure. Will the action prosper or not?

Gatpolintan, Mariel
2001
EXTINGUISHMENT; EXTRAORDINARY INFLATION OR DEFLATION
On July 1, 1998, Brian leased an office space in a building for a period of
five years at a rental rate of P1,000.00 a month. The contract of lease contained
the proviso that "in case of inflation or devaluation of the Philippine peso, the
monthly rental will automatically be increased or decreased depending on the
devaluation or inflation of the peso to the dollar." Starting March 1, 2001, the
lessor increased the rental to P2,000 a month, on the ground of inflation proven
by the fact that the exchange rate of the Philippine peso to the dollar had
increased from P25.00=$1.00 to P50.00=$1.00. Brian refused to pay the
increased rate and an action for unlawful detainer was filed against him. Will the
action prosper? Why? (5%)

Murillo, Lailani Marie L.

2001
LIABILITY; LEASE; JOINT LIABILITY
Four foreign medical students rented the apartment of Thelma for a
period of one year. After one semester, three of them returned to their home
country and the fourth transferred to a boarding house. Thelma discovered that
they left unpaid telephone bills in the total amount of P80,000.00. The lease
contract provided that the lessees shall pay for the telephone services in the
leased premises. Thelma demanded that the fourth student pay the entire
amount of the unpaid telephone bills, but the latter is willing to pay only one
fourth of it. Who is correct? Why? (5%)

Murillo, Lailani Marie L.

2002
NATURE OF CONTRACTS: RELATIVITY OF CONTRACTS
Printado is engaged in the printing business. Suplico supplies printing paper
to Printado pursuant to an order agreement under which Suplico binds himself to
deliver the same volume of paper every month for a period of 18 months, with
Printado in turn agreeing to pay within 60 days after each delivery. Suplico has been
faithfully delivering under the order agreement for 10 months but thereafter
stopped doing so, because Printado has not made any payment at all. Printado has
also a standing contract with publisher Publico for the printing of 10,000 volumes of
school textbooks. Suplico was aware of said printing contract. After printing 1,000
volumes, Printado also fails to perform under its printing contract with Publico.
Suplico sues Printado for the value of the unpaid deliveries under their order
agreement. At the same time Publico sues Printado for damages for breach of
contract with respect to their own printing agreement. In the suit filed by Suplico,
Printado counters that:

Cabalo, Chloe C.
2002
NATURE OF CONTRACTS: RELATIVITY OF CONTRACTS

a.) Suplico cannot demand payment for deliveries made under their order
agreement until Suplico has completed performance under said
contract;
b.) Suplico should pay damages for breach of contract; and
c.) with Publico should be liable for Printado's breach of his contract with
Publico because the order agreement between Suplico and Printado
was for benefit of Publico.
Are the contentions of Printado tenable?

Cabalo, Chloe C.
2002
NATURE OF CONTRACTS: RELATIVITY OF CONTRACTS

Stockton is a stockholder of Core Corp. He desires to sell his shares in Core

Corp. In view of a court suit that Core Corp. has filed against him for damages in
the amount of Php 10 million, plus attorney's fees of Php 1 million, as a result of
statements published by Stockton which are allegedly defamatory because it was
calculated to injure and damage the corporation's reputation and goodwill.

Cabalo, Chloe C.
2002
NATURE OF CONTRACTS: RELATIVITY OF CONTRACTS
The articles of incorporation of Core Corp. provide for a right of first refusal
in favor of the corporation. Accordingly, Stockton gave written notice to the
corporation of his offer to sell his shares of Php 10 million. The response of Core
Corp. was an acceptance to the offer in the exercise of its rights of first refusal,
offering for the purpose payment in form of compensation or to set-off against the
amount of damages it is claiming against him, exclusive of the claim for attorney's
fee. Stockton rejected the offer of the corporation, arguing that compensation
between the value of the shares and the amount of damages demanded by the
corporation cannot legally take effect.
Is Stockton correct?

Cabalo, Chloe C.