B. Both are false
C. No. 1 is true, No. 2 is false D. No. 1 is false, No. 2 is true 1. Statements:
No affirmation of the value of the thing, nor any statement purporting to be a statement of the seller’s opinion only, shall be construed as a warranty.
o FALSE, it will be considered a warranty when the seller made such affirmation or statement as an expert and it was relied upon by the buyer. Art. 1546.
The sale of animals suffering from contagious diseases shall be void.
o TRUE, Art. 1575.
2. Statements:
For the vendor to be held liable for breach of warranty against eviction, the judgment must be based on a right prior to the sale.
o FALSE, judgment may also be based on an act imputable to the vendor.
The vendee need not appeal from the decision in order that the vendor may become liable for eviction
o TRUE, Art. 1549.
3. Statements:
When adverse possession had been commenced before the sale but the prescriptive period is completed after the transfer, the vendor shall not be liable for eviction.
o TRUE, Art. 1550.
There are no implied warranties in sale of animals at fairs or at public auctions, or of live stock sold as condemned.
o FALSE, only warranties against hidden defects are not provided for such sales.
4. Statements:
If the property is sold for nonpayment of taxes due, the vendor is liable for eviction.
o FALSE, such nonpayment of taxes due shall not be made known to the vendee before the sale.
If two or more animals are sold together, whether for a lump sump or for a separate price for each of them, the redhibitory defect of one shall only give rise to its redhibition and not that of the others.
o FALSE, the statement will only be true if it should NOT appear that the vendee would not have purchased the sound animal or animals without the defective one. This will
Practice Questions and Suggested Answers 60 be presumed when a team, yoke, pair, or set is bought, even if a separate price has been fixed for each one of the animals composing the same. Art. 1572.
5. Statements:
Any stipulation exempting the vendor from the obligation to answer for eviction shall be void.
o FALSE, vendor must act in bad faith to render such stipulation void. Art. 1553.
Should the vendee have made the waiver with knowledge of the risks of eviction and assumed its consequences, the vendor shall not be liable.
o TRUE, Art. 1554.
Practice Questions and Suggested Answers 61 MULTIPLE CHOICE QUESTIONS
6. The following cannot be held liable for breach of warranty except:
a. sheriff b. auctioneer c. mortgagor ??
d. pledgee
e. none of the above
The law would specifically exempt certain persons from liability for breach of warranty like sheriff, auctioneer, mortgagee, pledgee and other persons who sell by virtues of an authority of law like notary public because they are not really selling for themselves, they are selling on behalf of another person.
7. The redhibitory action, based on the faults or defects of animals must brought within:
a. forty days from the date of their delivery to the vendee. (Art. 1577) b. forty days from the date of the contract
c. six months from the date of their delivery to the vendee.
d. six months from the date of the contract e. one year from the date of the contract
8. If there is a stipulation exempting the vendor from the obligation to answer for eviction and the vendor acted in bad faith the vendor shall be liable for the following:
a. Value of the thing at the same time of eviction
b. Income or fruits, if he has been ordered to deliver them to the party who won the suit against him
c. Expenses of the contract, if the vendee has paid them, and
d. Damages and interest, and ornamental expenses, if the sale was made in bad faith e. All of the above. (Art. 1555)
9. There is no implied warranty as to hidden defects/quality in the following, except:
a. “as is, where is” sales b. sale of second hand articles
c. sale by virtue of authority in fact or law (Art. 1570) d. animals sold at fairs or at public auctions (Art. 1574) e. when validly suppressed by parties
10. The buyer is deemed to have accepted the goods
a. when he intimates to the seller that he is accepting them.
b. when he does any act in relation to the goods which is inconsistent with the ownership of the seller
c. when he retains the goods after the lapse of a reasonable time without intimating to the seller that he has rejected them.
d. all of the above. (Art. 1585) e. none of the above.
Practice Questions and Suggested Answers 62 MACEDA LAW
TRUE OR FALSE
1. If the place of payment should not have been stipulated, the payment must be made at the place of the delivery of the thing sold.
2. The buyer of goods is not bound to accept delivery by installments.
3. Where the goods are delivered to the buyer, he is not deemed to have accepted them unless and until he has had a reasonable opportunity of examining them for the purpose of ascertaining whether they are in conformity with the contract.
4. Where there is a breach of warranty by the seller, the buyer may, refuse to accept the goods, and maintain an action against the seller for damages for the breach of warranty.
5. Acceptance of the goods by the buyer shall not discharge the seller from liability in damages or other legal remedy for breach of any promise or warranty in the contract of sale.
6. If, after acceptance of the goods, the buyer fails to give notice to the seller of the breach in any promise of warranty within a reasonable time after the buyer knows, or ought to know of such breach, the seller shall not be liable therefor.
7. The Maceda Law can only be invoked if the buyer had paid at least two years of installments before default.
8. The right to a grace period shall be exercised by the buyer, under the Maceda Law, only once in every five years of the life of the contract, and its extensions, if any.
9. Down payments, deposits or options in a sale covered by the Maceda Law, shall be included in the computation of the total number of installment payments made.
10. A sale of realty on credit will be covered by the Maceda Law.
MULTIPLE CHOICE QUESTIONS
11. The buyer is deemed to have accepted the goods when:
a. he intimates to the seller that he has accepted them
b. when the goods have been delivered to him, and he does any act in relation to them which is inconsistent with the ownership of the seller.
c. when, after the lapse of a reasonable time, he retains the goods without intimating to the seller that he has rejected them.
d. all of the above e. none of the above
12. The vendee shall owe interest for the period between the delivery of the thing and the payment of the price, in the following cases, except:
a. Should it have been so stipulated
b. Should the thing sold and delivered produce fruits or income
c. From the time the obligation to pay the price becomes due and demandable d. None of the above
13. The Realty Installment Buyer Act may apply to:
a. a sale of industrial lots
b. a sale of commercial buildings c. sales to tenants
d. all of the above
Practice Questions and Suggested Answers 63 e. none of the above
14. Under the Maceda Law, the buyer is entitled to a grace period of not less than:
a. 30 days b. 60 days c. 90 days.
d. one year e. two years
15. The cash surrender value is a minimum of:
a. 20% of the total payments made b. 30% of the total payments made c. 40% of the total payments made d. 50% of the total payments made e. 92% of the total payments made
Practice Questions and Suggested Answers 64 STATUS OF CONTRACTS OF SALE
1. There may be a contract of sale of goods, whose acquisition by the seller depends upon a contingency which may or may not happen.
a. TRUE. Express provision 1462(2).
2. The sale of expectancy is voidable.
a. FALSE. The sale of vain hope or expectancy is void. (1461(2)) 3. Things having a potential existence may be the object of the contract of sale.
a. TRUE. Express provision 1461(1).
4. A contract of sale is void when the object is neither particularly designated nor physically segregated from all others of the same class.
a. FALSE. The requisite that a thing be determinate is satisfied if at the time the contract is entered into, the thing is capable of being made determinate without the necessity of a new or further agreement between the parties. (1460(2))
5. If the price is simulated, the sale is void, but the act may be shown to have been in reality a donation, or some other act or contract.
a. TRUE. Express provision 1471.
i. Alternative answer: FALSE. Parties may be held bound by the false price indicated in the instrument, especially when the interest of the Government or third persons would be adversely affected by the reformation of the contract. (Spouses Doromal v. CA)
6. The husband and the wife cannot sell property to each other.
a. FALSE. The following are exceptions to the rule – a
i. Separation of property in the marriage settlement; and ii. Judicial separation of property (Art. 1490)
7. A contract of sale entered into by a guardian over the property of his ward is rescissible if the price is only 70% of the value of the property.
a. TRUE.
8. A contract of sale is void when the executor is the vendee and the object of the sale is a property of the estate under his administration.
a. TRUE. Relative Incapacity. (Art. 1491, par. 3)
9. A contract of sale if void when the vendee is not a Filipino citizen and the object of the sale is a private land.
a. FALSE. An exception is when a formerly natural-born Filipino citizen who lost his Filipino citizenship. (Estate of Serra v. Heirs of Hernaez)
i. Alternative answer: TRUE. The question depends on how you appreciate “not a Filipino citizen”.
Practice Questions and Suggested Answers 65 10. If the fixing of the price is left to the discretion of one of the parties, the contract will not be
perfected.
a. FALSE. The fixing of the price can never be left to the discretion of one of the contracting parties. However, if the price fixed by one of the parties is accepted by the other, the sale is perfected. (1473)
Practice Questions and Suggested Answers 66 REMEDIES
TRUE OR FALSE
16. It is not essential to the validity of a resale that notice of the time and place of such resale should be given by the seller to the original buyer.
a. TRUE.
17. It is not essential to the validity of resale that notice of an intention to resell the goods be given by the seller to the original buyer.
a. TRUE.
18. The unpaid seller cannot directly or indirectly buy the goods in the exercise of the right to resell.
a. TRUE.
19. The seller of goods is deemed to be an unpaid seller when a bill of exchange or other negotiable instrument has been received as conditional payment.
a. FALSE.
20. The unpaid seller may exercise his right of stoppage in transitu by obtaining actual possession of the goods.
a. TRUE.
21. The unpaid seller shall not be liable to the original buyer for any profit made by the resale of the goods.
a. TRUE.
22. A lien on the goods of the unpaid seller of goods can be exercised even if he is in possession of them merely as a depository.
a. TRUE.
23. The remedies of the unpaid seller of goods can no longer be invoked if ownership in the goods have passed already to the buyer.
a. FALSE.
24. The seller of goods is deemed to be an unpaid seller when the whole of the price has not been paid.
a. TRUE.
25. The remedies of an unpaid seller are alternative in character.
a. FALSE.
MULTIPLE CHOICE QUESTIONS
26. That the buyer is insolvent is a requirement for the exercise of the:
Practice Questions and Suggested Answers 67 a. A right to retain the goods
b. A right of stopping the goods in transitu c. A right of resale
d. A right to rescind the sale
e. A right to demand for the payment of the unpaid price
27. The unpaid seller of goods loses his lien , except:
a. When he delivers the goods to a carrier or other bailee for the purpose of transmission to the buyer without reserving the ownership in the goods or the right to the possession thereof
b. When the buyer or his agent lawfully obtains possession of the goods.
c. When he has obtained judgment or decree for the price of the goods.
d. By waiver thereof e. None of the Above
28. Goods are no longer in transit:
a. If the buyer, or his agent in that behalf, obtains delivery of the goods before their arrival at the appointed destination
b. If, after the arrival of the goods at the appointed destination the carrier or other bailee acknowledges to the buyer or his agent that he holds the goods on his behalf and continues in possession of them as bailee for the buyer or his agent
c. If the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent in that behalf
d. All of the above e. None of the Above
29. An unpaid seller cannot exercise the right to resell if:
a. The seller has parted possession of the goods b. The goods are of perishable nature
c. The seller expressly reserves the right of resale in case the buyer should make default d. The buyer has been in default in the payment of the price for an unreasonable time e. All of the above
f. None of the above
30. The unpaid seller’s right of lien or stoppage in transitu is not affected by any sale, or other disposition of the goods which the buyer may have made, unless:
a. The seller has parted possession of the goods
b. A negotiable document of title has been issued for goods, which were sold to a purchaser for value in good faith to whom such document has been negotiated
c. The goods are of perishable nature
d. The seller expressly reserves the right of resale in case the buyer should make default e. The buyer has been in default in the payment of the price for an unreasonable fare
Practice Questions and Suggested Answers 68 EXTINGUISHMENT OF CONTRACT OF SALE
TRUE OR FALSE
1. Legal redemption shall take place when the vendor reserves the right to repurchase the thing sold.
a. FALSE.
2. The vendor who repurchases the thing shall respect the leases constituted by the vendee.
a. FALSE.
3. Legal redemption is the right to be subrogated, upon the same terms and conditions stipulated in the contract, in the place of one who acquires a thing by purchase only.
a. FALSE.
4. Should there have been no fruits at the time of the sale and some exist at the time of redemption, they shall be prorated between the redemptioner and the vendee.
a. TRUE.
5. The contract shall be presumed to be a sale with a right to repurchase when the price in a mortgage is unusually inadequate.
a. FALSE.
6. The vendor cannot avail himself of the right of repurchase without returning to the vendee the price of the sale and the necessary and useful expenses made on the thing sold.
a. TRUE.
7. In case of doubt, a contract purporting to be a sale with right to repurchase shall be construed as an equitable mortgage.
a. TRUE.
8. The vendee is subrogated to the vendor’s rights and actions.
a. TRUE.
9. The creditors of the vendor cannot make use of the right of redemption against the vendee, until after they have exhausted the property of the vendor.
a. TRUE.
10. The right of redemption of co-owners excludes that of adjoining owners.
a. TRUE.
MULTIPLE CHOICE QUESTIONS
11. If the transaction is an equitable mortgage, the remedy is:
a. declaration of nullity
Practice Questions and Suggested Answers 69 b. annulment
c. rescission d. any of the above e. none of the above
12. In conventional redemption, the period for redemption, in the absence of an express agreement shall last:
a. one year from the date of the contract b. four years from the date of the contract c. one year from the registration of the contract d. four years from the registration of the contract e. none of the above
13. Should there be an agreement as to the period of redemption, the period cannot exceed:
a. one year b. four years c. ten years d. thirty years e. none of the above
14. In a sale of a parcel of land with a right to repurchase, there being no stipulation to the contrary, ownership passes to the vendee upon:
a. the perfection of the sale b. upon delivery
c. upon payment of the price
d. upon the lapse of the period to repurchase e. upon the order of the court
15. The remedy of the creditors of the vendor as to the right of redemption against the vendee is:
a. a cumulative remedy b. a principal remedy c. a subsidiary remedy d. all of the above e. none of the above
Practice Questions and Suggested Answers 70 LEASE
TRUE OR FALSE
1. A contract where one of the parties binds himself to render to the other some service is a contract for a piece of work.
a. FALSE, the statement pertains to a contract of lease of service.
i. In a contract for a piece of work, the contractor binds himself to execute a piece of work for the employer, in consideration of a certain price or compensation. The contractor may either employ only his labor or skill, or also furnish the material. (Art. 1713)
ii. In the lease of work or service, one of the parties binds himself to execute a piece of work or to render to the other some service for a price certain. (Art.
1644)
2. No lease for more than ninety-nine years shall be valid.
a. TRUE, Art. 1643.
3. Fungible goods cannot be the subject matter of a contract of lease.
a. TRUE, Art. 1665. --- according to source.
i. Alternative answer: FALSE, Art. 1645. When the lease of the thing, although fungible, is only for exhibit or it is an accessory to an industrial establishment, it can be the subject matter of a lease.
4. The guardian cannot lease the property of his ward for himself.
a. FALSE, although Art. 1646, in relation to Art. 1491, provides that a guardian is disqualified to become a lessee of a property of his ward, Art. 1647 will allow the guardian to lease such property if with proper court authority.
5. If a lease is to be recorded in the Registry of Property, the father or guardian, as to the property of the minor or ward, cannot constitute the same without proper authority.
a. TRUE, Art. 1647.
6. When in the contract of lease of things there is no express prohibition, the lessee may assign the lease, in whole or in part, without prejudice to his responsibility for the performance of the contract toward the lessor.
a. FALSE, Art. 1649 and 1650.
b. The lessee cannot assign the lease without the consent of the lessor, unless there is a stipulation to the contrary. (Art. 1649)
c. When in the contract of lease of things there is no prohibition, the lessee may sublet the thing leased. (Art. 1650)
c. When in the contract of lease of things there is no prohibition, the lessee may sublet the thing leased. (Art. 1650)