[BLR2] Final Exam

Section: *

BLT-AYB1

BLR2-YXZ1

BLR2-DYXZ1

Last Name, First Name, M.I.: *

Rovira, Ivie J.

Credit Transactions - Part 1

It is a contract in which the debtor guarantees to the creditor the fulfillment of a *

principal obligation, subjecting for the faithful compliance therewith a real
property in case of non- fulfillment of said obligation at the time stipulated.

Chattel mortgage

Pledge

Real mortgage

Antichresis
The following are essential requisites to the contract of pledge and mortgage *
except

That they be constituted to secure the fulfillment of a principal obligation

That the pledgor or mortgagor be the absolute owner of the thing pledged or
mortgaged

The pledgor or mortgagor can appropriate the object of pledge or mortgage upon
default.

That the persons constituting the pledge or mortgage have the free disposal of their
property and in the absence thereof, that they be legally authorized for the purpose

In addition to the requisites enumerated in article 2085, this is necessary in order *

to constitute the contract of pledge, otherwise creditor acquires no real right over
the property

Delivery

Be in public instrument

Signature

Negotiated

Appropriation of the mortgaged properties by the mortgage. *

Pactum commissorium

Pacta sunt servanda

Pactum commissioner

Pacto de retro
It is committed by a person who pretending to be the owner of any real property *
conveys it, sell or encumber or mortgage the same.

Estafe

Estafa

Trespass

None of the above

These are characteristics of a contract of pledge, except: *

Real

Accessory

Unilateral

Consensual

If the pledge owns or produces fruits, income, dividends, interests the creditor *
shall what he receives to

Payment of interest first then principal

Principal first then interest

To interest only

To interest then in case of excess, it shall belong to him.

the owner may sell the thing pledged provided *

the pledgor consented

the pledgee consented

a third person approves

the government approves

The debtor can only ask for the return of the thing pledged if the debt is fully paid. *
In addition to that, this must also be paid

Interest

Expenses

Both interest and expenses

Only the debt

It is one which is created by agreement of the parties *

Voluntary

Legal

Judicial

Consensual
All kinds of obligations can be secured by pledge or mortgage *

True

False

Somewhat true

Somewhat false

In a contract of pledge, the ownership of the thing pledged belongs to *

owner/pledgor

creditor

third person

government

Any stipulation whereby the thing pledged or mortgaged shall automatically *

become the property of the creditor in the event of non-payment of the debt
within the term fixed is

Null and void

Valid

Binding against the parties

Unenforceable if not in public instrument

Can the pledgee deposit the pledge with a third person? *

Yes, if there is a stipulation

No

Not sure

I’d rather not answer

In order to be binding against third persons, in the form is required, it shall appear *
therein the following

the description of the thing pledged

date of pledge

both description of thing pledged and the date of pledge

none of the above

The creditor cannot bring actions or defend the thing pledged against a third *
person based on the principal that contracts are only binding to the contracting
persons, those that are not parties shall not be affected.

True

False

Somewhat true

Somewhat false

No correct answers
the debtor cannot demand the return of the thing pledged until the debt is paid *

true

false

somewhat true

somewhat false

What exists is only a right of action to compel the fulfillment of the promise. *
There is essentially no pledge or mortgage yet.

True

False

Somewhat true

Somewhat false

The rule of indivisibility shall likewise not applicable if where each one of several *
things guarantees determinate portion of credit.

True

False

Somewhat true

Somewhat false
In order to be binding against third persons, this form is required. *

It must be in writing

It must be notarized

It must be in a private instrument

It must be in writing, notarized and embodied in a public instrument

One which is created by operation of law *

Legal

Voluntary

Conventional

Extra-judicial

It is contract by virtue of which the debtor delivers to the creditor or to a third *

person a movable or instrument evidencing incorporeal right for the purpose of
securing the fulfillment of a principal obligation.

Pledge

Mortgage

Chattel mortgage

Antichresis
But the creditor’s heir who received his share of the debt can return the pledge or *
cancel the mortgage.

True

False

Somewhat true

Somewhat false

The debtor’s heir who has paid a part of the debt can ask for the proportionate *
extinguishment of the pledge or mortgage even if the debt is not completely
satisfied.

True

False

Somewhat true

Somewhat false

The following are instances where the owner may ask that the thing pledged be *
deposited judicially or extra-judicially

If the creditor uses the thing without authority

Misusage

The thing is in danger of being lost or impaired

All of the above

the diligence required by law to the creditor or pledgee. *

Good father of a family

Father of a good family

Extra-ordinary care

All of the above

A pledge or mortgage is indivisible, but if the debt may be divided among the *
successor in interest of the debtor or the creditor, it is divisible.

True

False

Somewhat true

Somewhat false

The following contemplates the extinguishment of the contract of pledge except: *

The thing pledged is returned to the pledgor or owner

If subsequent to the protection of the pledge, the thing is in possession of the

pledgor or owner

If it is in the possession of a third person who has received it from the pledgor or
owner

If it is in the possession of the pledgee

A conditional obligation is one which do not depend on some contingency to take *
effect.

True

False

Somewhat true

Somewhat false

A mere promise to constitute pledge or mortgage creates a real right. *

True

False

Somewhat true

Somewhat false

Credit Transactions - Part II

The sale of the thing pledge shall extinguish the principal obligation *

True

False

Somewhat true

Somewhat false
It is one created by parties through an agreement *

Voluntary

Legal

Judicial

Equitable

Type of foreclosure wherein the action is to be brought in the court *

Judicial

Extrajudicial

Both

None

the following rule is an exception to above answer *

purchaser or mortgagee has knowledge of a defect or lack of title

mortgagee does not directly deal with the registered owner of the property

mortagee bank

all of the above

The following are characteristics of a contract of pledge except *

Real

Accessory

Unilateral

Consensual

The pledgee may also bid even if he is the only bidder *

True

False

Somewhat true

Somewhat false

A stipulation forbidding the owner from alienating the immovable mortage is *

Valid

Rescissible

Void

Unenforceable
Special Laws apply to pawnshops and establishments which are engaged in *
making loans secured by pledges. Provisions of the Civil Code shall apply

Subsidiarily

Primarily

Superior to the other special laws

Alternatively

The following are legal pledges except: *

He who has executed work upon a movable has a right to retain it by way of pledge
until he is paid

The agent may retain the things which are the objects of agency until the principal
effects the reimbursement and pays the indemnity

The laborer’s wages shall be a lien on the goods manufactured or the work done.

All of the above

the contract of mortgage extends to all its accessions, improvements, growing *

fruits and rents or income

true

false

somewhat true

somewhat false
a mortgagee has a right to rely to rely on good faith on the certificate of title of *
the mortgagor. He has no obligation to undertake further investigation

doctrine of mortgagee in good faith

doctrine of mortgagor in good faith

doctrine of good faith

pacto possesorium

If there are two or more things pledge, the pledgee may choose which he will *
cause to be sold

Yes he can

Nope

Not sure

Id rather not answer

It is the remedy available to the mortgagee by which he subjects the mortgaged *

property to the satisfaction of the obligation.

Foreclosure

Reformation

Redemption

Restitution
As in the case of the creditor, he is also entitled to the deficiency *

True

False

Somewhat true

Somewhat false

the contract of pledge must be recorded in the registry of property *

true

false

somewhat true

somewhat false

After the public auction he must promptly advise the pledgor or owner of the *
result thereof.

Pledgee

Cashier

Accountant

Court
All bids must be for cash *

True

False

Somewhat true

Somewhat false

effect of mortgage *

it creates a real right right

creates merely an encumbrance

creates a real right or merely an encumbrance

none

The creditor may claim from a third person payment of the part of the credit *
secured by the property which said third person possesses

True

False

Somewhat true

Somewhat false
As a general rule, the debtor is entitled to the excess *

True

False

Somewhat true

Somewhat false

The subject matter of a contract of real mortgage *

Movable

Immovable

Alienable real rights

Immovable and alienable real rights

The following are the formalities to be followed when the creditor caused the *
thing pledged except

The debt must be due and unpaid

The sale must be at public auction

There must be notice to the pledgor and owner

Notice to LGU
Can a third person who has any right to the thing pledged pay the principal *
obligation?

Yes he can

Nope

Not sure

Id rather not answer

one required by law *

voluntary

legal

extra-judicial

equitable

It is a contract whereby the debtor secures to the creditor the fulfillment of a *

principal obligation, specially subjecting to such security immovable property or
real rights over immovable property in case the principal obligation is not
complied with at the time stipulated.

Real mortgage

Pledge

Chattel mortgage

Antichresis
In order to extinguish the pledge, a statement in writing embodied in a public *
instrument is required.

True

False

Somewhat true

Somewhat false

The pledgor or owner may bid *

True

False

Somewhat true

Somewhat false

the mortgage credit cannot be alienated or assigned to a third person. *

True

False

Somewhat true

Somewhat false
one which, although it lacks the proper formalities of a mortgage shows the *
intention of the parties to make the property as a security for a debt

voluntary

legal

judicial

equitable

A contract where the creditor acquires the right to receive the fruits of an *
immovable of his debtor.

Antichresis

Real mortgage

Chattel mortgage

Pledge

Sales

It is defined as the delivery of movable property by mere consent or agreement, if *

the thing sold cannot be transferred to the possession of the buyer at the time of
sale.

Symbolic delivery

Traditio longa manu

Traditio brevi manu

Constitutum possessorium
Statement 1: A breach of warranty affects the validity of the contract of sale. *
Statement 2: A warranty must be stipulated in order to bind the parties.

Only Statement 1 is true.

Only Statement 2 is true.

Both Statements are true.

Both Statements are not true.

Alex entered into a contract of sale with Kim involving a laptop currently owned by *
Victor. They signed the document evidencing the contract on January 1, 2021
when Victor was still the owner of the laptop. On January 15 of the same year,
Victor donated the laptop to Alex. A week after, Alex delivered the laptop to Kim,
and Kim paid the price in accordance with the contract of sale. What is the status
of the contract of sale as to validity?

Void. The object is inexistent at the time of the contract of sale.

Unenforceable. The contract was entered into without Victor's authority.

Voidable. The contract was entered into with a defect in Victor's consent.

Valid. Alex was able to consummate the sale upon delivery.

A 1,000 square meter parcel of land located in Iloilo is owned by M. N sold the *
land to O under his own name on December 1, 2021. Fifteen days after, M sold
the land to P. O was the first to take possession of the land on December 20,
2021. Who has the better right over the land?

O, because he is the first buyer.

O, because he is the first to take possession in good faith.

P, because he bought the land from the actual owner.

P, Because he is the most recent buyer.

During the grace period granted under the Maceda Law, the buyer can do any of *
the following, EXCEPT:

Sell or assign his rights in a notarial instrument

Pay the unpaid balance of the price with interest

Update his account

Pay in advance any installement

Ms. S is the owner of 50 kilograms of sugar located in a warehouse. Ms. S sold *
25 kilograms to Ms. B. Which of the following is a correct statements as to the
effect of the sale?

The sale has no effect considering the 50 kilograms of sugar is still undivided.

Ms. S will still be the owner of the 50 kilograms of sugar prior to the division of the
sugar.

Ms. S and Ms. B become co-owners over the 50 kilograms of sugar even without the
division of the sugar.

Ms. B automatically becomes the owner of the entire mass of the 50 kilograms of
sugar subject to reimbursement to Ms. S for the value of the 25 kilograms.

It is the warranty that good are reasonably fit for the general purpose for which *
the same are sold.

Warranty of merchantability

Warranty against redhibitory defect

Warranty of fitness

Warranty against hidden defect

Before the remedy of cancellation of sale may be availed of by the seller under *
the Recto Law, how many installments must have not been paid by the vendee?

At least one

At least two

At least three

At least four

The place of delivery should be first at the place stipulated, then: *

I. Seller's place of business
II. Buyer's place of business
III. Seller's residence
IV. Usage of trade

I, III, and IV, in that order.

IV, I and III, in that order.

II, I, and IV, in that order.

IV, II, and I, in that order.

Under a sale on approval or trial, *

Delivery irrevocably transfers ownership to the buyer.

Delivery does not transfer ownership to the buyer but will only be transferred when
the buyer signifies his approval or acceptance to the seller.

Delivery transfers ownership to the buyer but ownership is deemed to revert to the
seller when the buyer signifies his disapproval or non-acceptance to the seller.

Delivery transfers ownership to the buyer but ownership is deemed to revert to the
seller when the buyer returns the thing sold to the seller.

Gigi is the operator of a merchant's store. Harry bought a cellphone in Gigi's *

merchant's store. Subsequently, Jane, whose phone had been recently stolen, saw
Harry's cellphone. After examining the phone , Jane concluded that it was the
cellphone that was stolen from her two weeks ago. Who is the rightful owner of
the cellphone?

Jane, because the phone was unlawfully taken from her.

Harry, because he acquired this in a merchant store.

Jane, because she can prove and trace that the phone was hers through means such
as the serial number and official receipts

Harry, because he purchased the phone for value.

D entered into a contract of sale with P over a parcel land with fruit bearing trees *
in August 1, 2021. The price was paid by P on September 1, 2021. The transfer of
title was made on October 1, 2021. Actual occupation was made by P on
November 1, 2021. Which of the following statements is true?

The fruits accruing from August 1, 2021 shall belong to P.

The fruits accruing from September 1, 2021 shall belong to P.

The fruits accruing from October 1, 2021 shall belong to P.

The fruits accruing from November 1, 2021 shall belong to P.

Which of the following is outside of the coverage of Maceda Law? *

Sale of residential dwellings

Sale of commercial buildings

Sale of residential lots

Sale of agricultural land

Under the Maceda Law, the buyer who has paid at least two (2) years of *
installment may avail of the grace period:

Once every two (2) years

Once every three (3) years

Once every four (4) years

Once every five (5) years

A contract of sale is not a/an: *

Consensual contract

Commutative contract

Unilateral contract

Nominate contract

Chicana entered into a contract of sale of items of makeup with Angel *

Mapagmahal. The terms of the sale provide that Angel will make a down payment
of 20% of the price, and the remaining 80% will be paid a month after delivery.
Chicana was able to deliver the items of makeup. Which of the following
statements is true?

Angel Mapagmahal is the owner of the items of makeup at the moment of perfection
of the contract of sale.

Angel Mapagmahal is the owner of the items of makeup upon making the down
payment.

Angel Mapagmahal is the owner of the items of makeup upon delivery.

Angel Mapagmahal will be the owner of the items only upon full payment.
A and B entered into a contract of sale where A sold his car to B on installment *
basis for P1,000,000, payable quarterly for three (3) years. The contract of sale
was perfected on November 1, 2020, and the car was delivered on January 1,
2021. The first quarterly payment was made on January 1, 2021. The ownership
of the vehicle remained with A. The ownership will transfer to B only upon
payment of the half of the installments. However, just three installments after, the
car was lost through a storm. In the absence of any stipulation in the contract of
sale, is B required to pay the remaining installments?

Yes, because the contract of sale has already been perfected.

Yes, because delivery of the car has already been made and possession is with B.

No, because notwithstanding the delivery of the car , ownership remained with A.

No, because it was through A's fault that the car was lost.

Statement 1: Under the Recto Law, if the seller has chosen the remedy of specific *
performance, then the seller can still seek the remedy of rescission. Statement 2:
Under the Recto Law, if the seller has chosen the remedy of specific performance,
then the seller can still seek the foreclosure of chattel mortgage.

Only Statement 1 is true.

Only Statement 2 is true.

Both Statements are true.

Both Statements are not true.

Aunt Jul and Mac entered into a contract on a "sale or return" basis over some *
pieces of equipment. After delivery to Mac, the thing was lost due to a fortuitous
event. Mac has not yet paid the purchase price. Who shall bear the loss?

Aunt Jul. because she is still the owner considering the sale is made on a "sale or
return" basis.

Mac, because upon delivery, he became the owner of the thing sold.

Aunt Jul, because the seller bears the loss if the loss is due to a fortuitous event.

Mac, because Aunt Jul is an unpaid seller.

Under the Maceda Law, if the buyer has paid less than two (2) years of *
installments, the grace period is at least:

Thirty (30) days

Sixty (60) days

Ninety (90) days

One hundred twenty (120) days

JK, an expert in metals, bought 1,000 kilos of gold from Jim for use in making *
furniture with pure gold plating. Unknown to both JK and Jim, the bars of gold
sold are not pure gold. When it was melted and molded into gold plates, the poor
quality of the gold did not satisfy JK. Is Jim liable for breach of warranty against
hidden defects?

Yes. Because the defect is not patent or visible.

Yes. Because the defect renders the thong sold unfit for the use for which it was
intended.

No. Because the buyer is an expert who should have known the defect.

No. Because the seller is not aware of the hidden fault or defect.

It is defined as a statement or representation made by the seller *

contemporaneously and as part of the contract of sale, having reference to the
character, quality or title of the goods, and by which he promises or undertakes to
ensure that certain facts are or shall be as he then represents.

Representations

Conditions

Warranties

Specifications
Drew sold to Arch five cows. Drew will be liable to Arch if: *

The cows dies within three (3) days of a disease that existed at the time of sale.

The cows die within five (5) days of a disease that existed at the time of sale.

The cows die within seven (7) days of a disease that existed at the time of sale.

The cows die within ten (10) days of a disease that existed at the time of sale.

Under the Maceda Law, if the buyer has already paid installments for seven (7) *
years, then the buyer has the right to the refund of cash surrender value
amounting to:

50% of the total amount paid

60% of the total amount paid

70% of the total amount paid

80% of the total amount paid

In case of a double sale involving movable property, who among the following has *
preferred right?

The first possessor in good faith

The first registrant in good faith

The person with the oldest title

The buyer in the oldest sale

Statement 1: Parties may agree when and on what conditions the ownership shall *
pass to the buyer other than by mere delivery. Statement 2: Delivery of keys of the
place or depositary where the movable is stored or kept is not a mode if
constructive delivery.

Statement 1 is true.

Statement 2 is true.

Both Statements are true.

Both Statements are not true.

Statement 1: Delivery to a common carrier is, as a general rule, is not tantamount *

to delivery to the buyer. Statement 2: If the seller bears the expenses of
transportation of the goods sold up to the FOB point, then the seller assumes the
risk of loss while the goods are in transit.

Only STatement 1 is true.

Only Statement 2 is true.

Both Statements are true.

Both Statements are not true.

Which of the following is a characteristic of an earnest money? *

It is given when sale is not yet perfected.

It is part of the purchase price.

When give, the would-be buyer is not required to buy.

It is separate and distinct consideration from the consideration of the contract of

sale.

In this mode of delivery, seller continues to be in possession of the property sold *

not as owner but in some other capacity, like as tenant or lessee.

Symbolic Delivery

Traditio longa manu

Traditio brevi manu

Constitutum possessorium

Warranty against redhibitory defect applies in the sale of: *

I. Animals
II. Plants
III. Non-Living things

I only.

I and II only.

I and III only.

I, II, and III.

When the seller exercises his right of redemption, the seller is bound to pay all of *
the following, EXCEPT:

Price of the sale

Expenses of the contract

Necessary and useful expenses

Luxurious expenses

In case there is a breach of an express warranty, what it the prescriptive period to *

rescind the contract in the absence of any stipulation?

Two (2) years

Four (4) years.

Five (5) years

Ten (10) years

Under the Recto Law, if the seller chooses the foreclosure of chattel mortgage, *
then

The seller shall have no further action to recover any unpaid balance

The seller shall have no further action to recover any unpaid balance unless
stipulated.

The seller may recover any unpaid balance.

The seller may recover any unpaid balance unless stipulated.

Statement 1:As a general rule, inadequacy of price does not affect a contract of *
sale's validity. Statement 2: When there is no price agreed upon, the sale is
voidable.

Only Statement 1 is true.

Only Statement 2 is true.

Both Statements are True.

Both Statements are not true.

Which of the following sale is void? *

Sale of animals through fairs or public auctions

Sale of animals suffering from contagious disease

Sale of livestock as condemned

Sale of livestock not for human consumption

In the event that the buyer was totally evicted from the real property he bought *
from the seller, the buyer can demand from the seller the payment of:

Value of thing sold at the time of sale

Value of thing sold at the time of eviction

Value of thing sold at the time of foreclosure

Value of thing sold at the time of payment of price by the buyer

Statement 1: If the seller delivers goods which are less than what was contracted, *
the buyer cannot reject the goods delivered. Statement 2: If the seller delivers
goods which are less than what was contracted, the buyer can accept and pay at
the contract rate.

Only Statement 1 is true.

Only Statement 2 is true.

Both Statements are true.

Both Statements are not true.

Statement 1: There can be transfer of ownership without delivery if there is *

stipulation provided for such in the contract of sale. Statement 2: In order to
transfer ownership, delivery must always be actual and physical, and not
constructive.

Only Statement 1 is true.

Only Statement 2 is true.

Both Statements are True.

Both Statements are not true.

Daenerys bought a parcel of land from Cersei. A montj after settling on the said *
parcel of land, it became the subject of dispute, putting in issue Cercei's and
Deanery's title over the land based on a sale that occurred prior to Daenerys'
purchase. Is Cersei liable for breach of warranty against eviction?

Yes. The right of the claimant existed prior to the sale of the land to Daenerys

No. There is no eviction by final judgment.

Yes. Cersei is made co-defendant in the suit for eviction.

No. There was no showing that the act that caused the eviction is an act imputable
to Cersei.

Dealer's talk: *

Is considered as warranty

Is considered as a warranty only if relied upon by the buyer

Is considered as a warranty only if made by an expert and relied upon by the buyer

Is considered as a warranty only if it appears on the instrument evidencing the sale,

made by an expert and relied upon by the buyer

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