FPB Flashcards by Tina A

It is the statutory amounts allowed to a party to an action for his expenses incurred in
the action.

Court Fees

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1st Statement - Payment must be made to the creditor, who is the creditor all the time
of the constitution of the obligation.
2nd Statement – If a person is subrogated to the right of the creditor, payment can still
made to the original creditor.

False, False

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The common property of a universal partnership shall be:

All the properties which belong to each of the partners at the time of the constitution of the partnership as well as the all the profits which they may acquire therewith

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The process of intentionally deceiving others by producing the appearance of a contract which is different from the true agreement is:

Relative Simulation

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In return for the 20 years of faithful service of X as a house helper to Y, the latter
promised to pay Php100,000.00 to X’s heirs if he (X) dies in an accident by fire. X
agreed. Is this an insurance contract?

No, since Y actually made a conditional donation in X’s favor

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The person who pays for the debtor is put into shoes of the creditor, so to speak.

Subrogation

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Dona pledged her LG washing machine to Belle for P25,000.00. Dona was unable to
pay the obligation 60 days after due date. Belle sold the machine at public auction for
P15,000.00. Which of the following is correct?

Belle cannot recover the deficiency of P10,000.00

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Which is true in the effects of the payment of the penalty?

The debtor can perform the obligation and not pay the penalty

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Which is false about the binding effects of voidable contacts?

The existence of economic damage is essential for the annulment of voidable contracts

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A, single, has been active member of the Social Security System (SSS) for the past 20
months. She became pregnant out of wedlock and on her 7th month of pregnancy, she
was informed that she would have to deliver the baby through caesarian section
because of some complications. Can A claim maternity benefits?

Yes, the law does not make distinctions between married and unmarried
female.

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Remedies of the Unpaid Seller. Except:

Foreclosure of the goods

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The crime of estafa by issuing a check has the following elements. Which among the
following is not included:

1) the offender has postdated or issued a check in payment of an obligation contracted at the time of the postdating or issuance
2) at the time of postdating or issuance of said check the offender has no funds in the bank or the funds deposited are not sufficient to cover the amount of the check
3) the payee has been defrauded

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This is constructed to mean an arrangement or understanding with the bank for the
payment of such check.

Credit

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FOB alongside the vessel, who pays the expenses?

Vendee

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Atoy sold to Bitoy a residential lot said to be containing an area of 1,000 square meters
at P1,000 per square meter. In this connection, which of the following statements is
correct?

f the lot should contain 900 sq. meters, B can choose between
proportionate reduction of the price or rescission of the sale.

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Tradition clavium applies to –

Movable property

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Maria agreed to deliver an IPhone Slim Edge, or Samsung Galaxy S6, or LG Beat
Cellphone to Petra. In the given example of an alternative obligation, which of the
following effects of loss of objects of obligation does not conform to the provisions of the
law?

(if the phone is lost, the obligation is extinguished)

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The case where the minor was guilty of passive misrepresentation and was held not
liable for the contract.

Rosario L. De Braganza, et al., petitioners
vs
Fernando F. De Villa Abrille, respondent

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A natural obligation under the New Civil Code of the Philippines is one which

Cannot be judicially enforced but authorizes the obligee to retain the obligor’s payment or performance

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Annaliza uses a savings account with a BPI bank. The contract between Annaliza and
the bank is one of:

Simple loan

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The reckoning of the prescriptive period to file action for annulment is four (4) years
depending on the cause of action. Identify which does not conform with the rule:

(Fraud) In case of intimidation, violence or undue influence from the time the defect of the consent ceases

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Which of the following is not correct?

A particular partnership has for its object determinate things, their use of fruits, or a specific undertaking or the exercise of a profession or vocation (WRONG)
Particular partnership = Specific undertakings

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Gabriel sold to Andre a car for a price of P750,000.00. The contract provides that
Andre will pay cash of P200,000.00 and for the balance, Andre will give a land worth
P550,000.00. What is the nature of the contract?

Sale

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Which of the following is not an obligation of the pledgor?

To participate in the public auction of the thing pledged.

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AA owes fifteen (15) persons substantial amounts of money. His financial situation indicates that his liabilities far exceed his assets. If AA cedes or assigns his properties to his creditors,

: The creditors shall sell the properties assigned and when sold, the debt of AA shall only be released to the extent of the net proceeds of the sale

AA entered into a contract to sell with BB, undertaking to convey to the latter one of the five lots he owns, without specifying which lot it was, for the price of P1 Million. Later, the parties could not agree which of five lots he owned AA undertook to sell to BB. What is the standing of the contract?

Void

X alleged that Y promised to give X one hectare of land. This is in consideration of X’s meritorious service to Y. Y pleads in defense that since the promise was not in writing, it is unenforceable under the Statute of Frauds. Decide.

The statute of fraud is inapplicable here because the promise to give the land is not of real property

A sold his land to B who began to possess it. Later C, a stranger, sold the same land to D who in good faith registered the sale. Who should be considered as the owner?

P, a salesgirl in a flower shop at the Ayala Station of the Metro Rail Transit (MRT) bought two tokens or tickets, one for her ride to work and another for her ride home. She got to her flower shop where she usually worked from 8 a.m. to 5 p.m. At about 3 p.m., while P was attending to her duties at the flower shop, two crews of the MRT got into a fight near the flower shop, causing injuries to P in the process. Can P sue the MRT for contractual breach as she was within the MRT premises where she would shortly take her ride home?

No, since P had no intention to board an MRT train coach when the incident occurred.

Upon the proposal of a third person, a new debtor substituted the original debtor without the latter’s consent. The creditor accepted the substitution. Later, however, the new debtor became insolvent and defaulted in his obligation. What is the effect of the new debtor’s default upon the original debtor?

The original debtor is free of liability since ovation took place and this relieved him from his obligation

Today A and B entered into a contract. Three years later, A discovered that B used fraud in the performance of their contract.

A can still ask for annulment within 4 years after the discovery of the fraud.

AA and BB orally agreed on the following: (i) the land to be sold has an area of 10,000 sq. meters; (ii) price is P5Million; and (iii) AA shall prepare the deed of sale. With fraudulent intent, AA knowing the inadequacies of BB with respect to numbers wrote 1,000 sq. meters instead of 10,000 sq. meters. The sale is

Valid but the instrument may be reformed

To secure the payment of an earlier loan of P20,000 as well as subsequent loans which her friend Noreen, would extend to her, Karen executed in favor of Noreen a chattel mortgage over her (Karen) car. Is the mortgage valid?

A chattel mortgage cannot effectively secure after0incurred obligations. the chattel mortgage in the problem given would be deemed to secure only the loan of 20,000

De Leon owns Candido P10,000. As security, De Leon pledged his horse to Candido. While in the possession of the latter, the horse gave birth to a pony. Who is entitled to the pony?

De Leon shall be entitled to the pony but it shall be included as pledge in the absence of a stipulation.

Conventional subrogation of a third person requires the consent of:

The original parties and of the third person

A, B, C and D are joint creditors of E and F, solidary debtors in the amount P40, 000. How much can A, B and C collect from E?

A, B and C could collect P30, 000 from E

Ownership is retained despite delivery, except

Mutuum

Which statement is FALSE?

The action for annulment of contracts shall be extinguished when the thing which is the object thereof is lost through fraud or mistake of the person who has a right to institute the proceedings

Which of the following is correct?

A voidable contract produces legal effects

following are instances where Unpaid Seller can exercise right of resale, except:

Insolvency of the buyer

Juan and Miguel are solidary debtors of Pedro in the amount of Php 100,000.00. This type of solidarity is an example of?

Passive solidarity

Pedro obliged himself to deliver to Juan an iPhone cellphone. This type of obligation is an example of?

Simple obligation

As a general rule, in assignment of credit, the assignor in good faith: A. Warrants the existence of the credit at the time of assignment B. Warrants the legality of the credit at the time of assignment C. Warrants the solvency of the debtor at the time of assignment

A and B

Which is not an element of Novation?

If they are compatible, the new obligation novates the first

In the Redemption of Rural land, what is the rule?

If two or more adjoining owners desire to exercise the right of the redemption at the same time, the owner of the adjoining land of smaller area shall be preferred; and should both lands have the same area the one who first requested the redemption

The order in double sale of real property A. Possession in good faith B. Registration in good faith C. Oldest title in good faith

BAC

After many years of shopping in the Metro Manila area, housewife HW has developed the sound habit of making cash purchases only, none on credit. In one shopping trip to Mega Mall, she got the shock of her shopping life for the first time, a store‘s smart salesgirl refused to accept her coins in payment for a purchase worth not more than one hundred pesos. HW was paying seventy pesos in 25centavo coins and twenty five pesos in 10 centavo coins. Strange as it may seem, the salesgirl told HW that her coins were not ―legal tender.

Coins 25 cents and below: up to P100 is legal tender

If a partner is induced by fraud or misrepresentation to become a partner, the remedy is

Voidable

The following are instances when there is no deficiency judgment, except:

``` (with deficiency judgemnet) real estate mortgage chattel mortgage antichresis conventional pledge ```

Right of vendee where immovable sold encumbered with non-apparent burden, EXCEPT:

Rights 1) he may ask for the rescission of the contract unless he should prefer the appropriate indemnity 2) within one year to be computed from the execution of the deed the vendee may bring the action for for rescission or sue for damages 3) one year having elapsed, he may only bring an action for damages within an equal period, to be counted from the date on which he discovered the burden or servitude

Act of administration: A managing partner can perform even without the knowledge and consent of the other partners. Act of dominion or ownership: All partners, including managing partner, must give their consent.

Both statements are true

Statement No. I - Actual knowledge is equivalent to registration of the sale in real property. Statement No. II - In case of personal property, the buyer who first registers it is the owner of the thing. Statement No. III - The vendee must appeal the decision in order that the vendor may become liable for eviction.

Only 1 statement is false

Because of failure of Janette and Jeanne to pay their loan to X Bank, the latter foreclosed on the mortgage constituted on their property which was put up by them as security for the payment of the loan. The price paid for the property at the foreclosure sale was not enough to liquidate the obligation. The bank sued for deficiency. In their answer, Janette and Jeanne did not deny the existence of the loan nor the fact of their default. They, however, interposed the defenses that the price at the auction was extremely low and that their loan, despite the loan documents, was a long-term loan which had not yet matured

X bank is correct. The inadequacy of the price of the sold properties is not a barrier for the debtor to redeem such property.

The following are the remedies available to the creditor in order to protect his rights against the debtor, except

To have the debtor prosecuted, punished and imprisoned for violations of the Revise Penal Code of the Philippines

Identify which of the following statement is FALSE?

If AA and BB are jointly liable to pay CC Php 1,000,000.00. This is an example of joint indivisible obligation

Solid Investment House commissioned Mon Blanco and his son Steve, both noted artists to paint a mural for the Main Lobby of Solid for a contract price of P2M. Who owns the mural?

Solid investment house

Juan was born on January 5, 2005 and Maria was born on February 14, 2006 and are highschool sweethearts. They met each other while they were in their elementary days. Due to their undying love for each other, they entered into a contract of marriage. What is the status of the marriage?

unenforceable

Leonardo is the Chairman and President, while Raphael is a Director of NT Corporation. On one occasion, NT Co, represented by Leonardo and A Ent, a single proprietorship owned by Raphael, entered into a dealership agreement whereby NT Co appointed A Ent as exclusive distributor of its products in Northern Luzon. What is the status of the dealership agreement?

The dealership agreement is valid upon the assumption that the same was approved by the BOD of NT Co before it was signed and that such approval was made under the following conditions

In order that fraud may make a contract voidable:

: It should be serious and should have not have been employed by both contracting parties

The following are instances when implied warranty is not applicable, except:

: Sale or return

If a partner is insolvent, the first in the order of preference in the distribution of his assets is:

Separate creditor of the partner

All of the following are obligations of the debtor if the object is a determinate thing, except:

To deliver the fruits from the perfection of contract.

Rodman, the President of TF Co, wrote a letter to Gregorio, offering to sell to the latter 5,000 bags of fertilizer at P100 per bag. Gregorio signed his conformity to the letteroffer, and paid a down-payment of P50th. A few days later, the Corporate Secretary of TF informed Gregorio of the decision of their BOD not to ratify the letter offer. However, since Gregorio had already paid the down-payment, TF delivered 500 bags of fertilizer which Gregorio accepted. TF made it clear that the delivery should be considered an entirely new transaction. Thereafter, Gregorio sought enforcement of the letter-offer. Is there a binding contract for the 5,000 bags of fertilizer? Explain.

No, Rodman was not authorized by the BOD to enter into the said contract or that he was empowered to do so

S sold to B a parcel of land for P1 million. B paid S P1 million in fake bills. The sale is:

Valid because of the valid cause which is the 1,000,000 price

After many difficult years, which called for sacrifices on the part of the company‘s directors, ABC Manufacturing Inc was finally earning substantial profits. Thus, the President proposed to the BOD that the directors be paid a bonus equivalent to 15% of the company‘s net income before tax during the preceding year. The President‘s proposal was unanimously approved by the BOD. A stockholder of ABC questioned the bonus. Does he have grounds to object?

Yes, the law provides that the total annual compensation of the directors, in the preceding year, cannot exceed 10% of the company‘s net income before income tax

The remedy to recover the ownership of the real property

Accion reivindicatoria(?)

Which of the following statements is correct?

A stipulation which excludes one or more partners from any shares in the profits or losses is void

Which of the following statements is not correct?

A limited partner may not be an unsecured creditor of the limited partnership

Dunggon borrowed P50,000 from Carlo. As security for the payment of the debt, Dunggon pledged a rolex watch valued at P75,000. It was expressly stipulated in the contract that if Dunggon cannot pay his debt when it matures, the debtor shall “execute a deed of absolute sale of the ring in favor of the creditor.” Dunggon failed to pay the debt when it matured.

Carlo cannot appropriate the watch because it is pactum commissorium which is expressly prohibited by law

A sale with the right to repurchase anytime from the date of sale was executed. In this case:

The buyer has 4 years within which to repurchase the property sold.

Reformation is not the property remedy if

There was mistake, fraud, inequitable conduct or accident which prevented the meeting of the minds of the contracting parties

NO. 1: A substituted limited partner has the right to inquire any information or account of the partnership transactions and to inspect partnership books. NO. 2: A substituted limited partner shall be subject to all restriction and liabilities of the assigning limited partner

True true (?)

AA offered to sell his land to BB for Php 300,000.00. BB accepted the offer and paid AA the purchase price. AA delivered the owner’s duplicate of the Transfer Certificate of title of the land. BB wants to register the land in his name but the Register of Deeds asks BB for the Deed of Sale. What can BB do?

He may compel Mr. AA to execute the Deed of Sale because the contract is valid

AA, who was in the United States of America, phoned his brother, BB, authorizing him to sell AA’s parcel of land in Pasay. AA sent the title to BB by courier service. Acting for his brother, BB executed a notarized deed of absolute sale of the land to Z after receiving payment. What is the status of the sale?

Void, since AA should have authorized agent BB in writing to sell the land

The following contracts, except one, are void ab initio. Which is the exception?

Void ab initio / void at the beginning those whose cause object or purpose is contrary to law morals good customs public order or public policy those which are absolutely simulated or fictitious those whose cause or object did not exist at the time of the transaction those whose object is outside the commerce of men those which contemplate an impossible service those where the intention of the parties relative to the principal object of the contract cannot be ascertained those expressly prohibited or declared void by law

AA and BB executed jointly and severally a promissory note for Php 2,000,000.00 in favor of CC. CC remitted the whole obligation because of his love for AA. Under the foregoing, which is true in remission?

If only Php 1,300,000.00 is remitted, BB is still liable to CC for Php 700,000.00

AA owes BB Php 100,000.00. On the due date, AA delivers a cashier’s check for the full amount. BB refuses to accept the check.

AA has no legal basis for making a consignation

Statement No. 1: The offense under B.P. 22 is a continuing offense and may therefore be prosecuted within the territory where any of the elements have been committed. Statement No. 2: Each act of drawing and issuing of a bounced check constitutes a violation of B.P. 22

True, false

An employee of a large manufacturing firm earns a salary which is just a bit more than what he needs for a comfortable living. He is thus able to still main tain a P10,000 savings account, a P20,000 checking account, a P30,000 money market placement and a P40,000 trust fund in a medium-size commercial bank.

The P10,000 savings account and the P20,000 checking account are deemed insured by the PDIC. The P10,000 savings account and the P20,000 checking account are covered by the Law on Secrecy of Bank Deposits.

The following are true about Rescission in a Rescissible contract, except

Rescission is a principal remedy

In the following instances, tender of payment is not required, except:

tender of payment not required 1) when the creditor is absent or unknown or does not appear at the place of payment 2) when he is incapacitated to receive the payment at the time is due 3) when without just cause he refuses to give a receipt 4) when two or more persons claim the same right to collect 5) when the title of the obligation has been lost

A mortgaged his car to B for P200,000. A failed to pay his obligation. B sold it at public auction for P180,000. Can B recover the deficiency?

Yes, even without stipulation

Property rights of a partner, except

property rights of a partner 1) his rights in specific partnership property 2) his interest (profit plus surplus) in the partnership and 3) his right to participate in the management

Solid Investment House commissioned Mon Blanco and his son Steve, both noted artists to paint a mural for the Main Lobby of Solid for a contract price of P2M. Who owns the copyright of the mural?

Mon Blanco and his son owns the copyright being the artists of the mural and the ones who exerted the efforts

X, at Y’s request, executed a Real Estate Mortgage (REM) on his (X’s) land to secure Y's loan from Z. Z successfully foreclosed the REM when Y defaulted on the loan but half of Y's obligation remained unpaid. May Z sue X to enforce his right to the deficiency?

No, because X is not Z’s debtor.

G, a grocery goods supplier, sold 100 sacks of rice to H who promised to pay once he has sold all the rice. H meantime delivered the goods to W, a warehouseman, who issued a warehouse receipt. Without the knowledge of G and W, H negotiated the receipt to P who acquired it in good faith and for value. P then claimed the goods from W, who released them. After the rice was loaded on a ship bound for Manila, G invokes his right to stop the goods in transit due to his unpaid lien. Who has a better right to the rice?

P, since he has superior rights as a purchaser for value and in good faith.

S1 - Transparency allows public involvement of qualified and eligible Civil Society Organizations (NGOs, PAs, academic Institutions, and religious institutions) to observe and monitor the procurement process until contract implementation. S2 - Primary beneficiaries shall have the priority claim to death benefits over secondary beneficiaries. Whenever there are primary beneficiaries, no death benefits shall be paid to secondary beneficiaries.

S1 is incorrect, S2 is correct

The following are instances when the certificate in a limited partnership may be amended, except:

all the limited partners cease to be such

A worker below 18 should be directly under the sole responsibility of parents or guardians; work does not interfere with the child’s schooling/normal development; with work permit from DOLE. S2 - Competitive Bidding refers to a method of procurement which is opentoparticipation by any interested party

S1 is incorrect, S2 is correct

X subscribed to 10,000 shares in the capital stocks of AAA Corporation. Hepaid50% of the 10,000 shares. X asked the Corporate Secretary to issue him the corresponding stock certificate representing the 50% of what he already paid. The Corporate Secretary of the corporation refused. Was the Corporate Secretary correct?

The Corporate Secretary is correct because the Revised Corporation Code provides that no certificate of stock shall be issued to a subscriber until the shares as subscribed have been fully paid.

A private corporation was created by a special law. Later, the law creating it was declared invalid. May such corporation claim to be a de facto corporation?

No, where a private corporation is created under a special law, there is no attempt to incorporate a valid corporation

- RA 7934 aims to protect consumers against hazards to health and safety, protect consumers against deceptive, unfair and unconscionable sales acts and practices, provide information and education to facilitate soundchoice and the proper exercise of rights by the consumers, provide adequaterights and means of redress. S2 - Premium pay is the amount given in case a worker does not work onhisrest day.

1 is correct, S2 is incorrect

S1 – The freeze order in AMLA shall be effective immediately within a period of 20 days. S2 - On motion of the petitioner filed before the expiration of twenty days from issuance of a freeze order in AMLA proceedings, the court may for good cause extend its effectivity for a period not exceeding six months. S3 – The officers of the homeowners association shall be given fifteen (15) working days to refer the application to the members of the association.

S1 and S2 are true, S3 is false

The period to appeal the denial of the application for registration of a Cooperative from CDA to the Office of the President is

90 days

The Board of Directors of XYZ Corp. unanimously passed a Board Resolutionapproving the taking of steps that in reality amounted to willful tax evasion. Ondiscovering this, the government filed tax evasion charges against all thecompany’s members of the board of directors. The directors invoked thedefense that they have no personal liability, being mere directors of a fictional being. Are they correct?

No, since the law makes directors of the corporation solidarily liable for gross negligence and bad faith in the discharge of their duties.

the following contracts can be ratified, except:

Unauthorized

All of the choices

I do that you may give

Facio ut des

Stikki Cement Company was organized primarily for cement manufacturing. Anticipating substantial profits, its President proposed that Stikki invest ina) apower plant project, b) a concrete road project, and c) quarry operations for limestone in the manufacture of cement. What corporate approval or voteisneeded for quarry operations for limestones in the manufacture of the cement?

Majority of the BOD

Alternative dispute resolutions (ADR) are recognized both in the RevisedCorporation Code and the Cooperative Law. This ADR is a process whereinthe parties meet with a mutually selected impartial and neutral person whoassists them in the negotiation of their differences.

Mediation

S1 – The bond of the single stockholder if he is likewise the treasurer is renewed every 3 years. (3 years wrong) S2 – The vote to divide the Cooperative is ¾ of the members. S3 – The limited partner may rightfully demand the return of his contributionafter he has given a one (1) month notice in writing to all members if no timeis specified in the certificate. (60 days dapat)

S1 and S3 are false, S2 is true

The One Person Corporation is required to submit the following documents, except:

Compensation of director

M and N were very good friends. N borrowed P10,000 fromM. Becauseof their close relationship, the promissory note executed by N provided that hewould pay the loan “whenever his means permit.” Subsequently, Mand Nquarreled. M now seeks to collect the loan because he is in dire need of money. What kind of obligation is present?

Period

S1 - Alternative methods of procurement is allowed in highly exceptional cases. S2 - As the owner of a business, the employer enjoys what are commonly known as management prerogatives. Among these are the right to select thepersons to be hired and to discharge them for a just and valid cause; to promulgate and enforce reasonable employment rules and regulations’ tocreate, merge, divide, classify, and abolish departments or positions in thecompany’ to sell or close the business. The exercise of those rights however must always be in good faith.

Both are correct

The Bangko Sentral ng Pilipinas

In case of a pre-negotiated rehabilitation plan in Section 76 of FRIA, it shouldbe approved by:

Creditors holding at least 2/3 of the total liabilities of the debtor including secured creditors holding more than 50% of the total secured claimand unsecured creditors holding more than 50% of unsecured claims.

The following are prohibited transactions in a limited partnership, except:

granting loans to the partnership

In distinguishing Earnest Money from Option Money, Earnest Money is

Given only when there is a perfected contract of sale

The Corporation Code sanctions a contract between two or more corporations which have interlocking directors, provided there is no fraudthat attends to it, and it is fair and reasonable under the circumstances. The interest of an interlocking director in one corporation may be either substantial or nominal. It is nominal if his interest:

does not exceed 20% of the outstanding capital stock

Offenses against the confidentiality, integrity, and availability of computer data and system, except:

Infringement

Under the Articles of Incorporation of Manila Industrial Corp, its principal place of business shall be in Pasig, MM. The principal corporate office is at the Ortigas Center, Pasig, MM while its factory processing leather productsisin Manila. The corporation holds its annual stockholders‘ meeting at theManila Hotel in Manila and its BOD meeting at a hotel in Makati MM. Thebylaws are silent as to the place of meetings of the stockholders and directors. Where should the meeting of the stockholders be held?

Within Metro Manila, Metro Manila is considered a city or | municipality

``` In the election for the Board of Trustees of non-stock corporations, the right of the members of any class or classes to vote may be limited, broadened, or denied and each member shall be entitled to one vote. This is true - ```

unless otherwise provided in the Articles of Incorporation or intheBy-laws.

S1 – In Culpa Aquiliana, negligence is only incidental. (x) S2 – In Culpa Contractual, ordinary diligence is available as a defense(x) S3 – The Master and Servant Rule applies in Civil Negligence (/) S4 – Proof beyond reasonable doubt is the evidence required in Culpa Criminal (/)

Only two statements are false

The penalty for violation of BP 22 is –

Both imprisonment and fine

The BOD of a corporation declared due and payable all unpaid subscriptionto the capital stock. The lone dissenting director failed to pay on due date, i.e., 19 Sept 2021, his unpaid subscription. Other than the shares wherein hewasunable to complete payment, he did not own any share in the corporation. On23 Sept 2021, he was informed by the BOD that, unless due payment is meanwhile received, he: a) could no longer serve as a director of the corporation forthwith: b) would not be entitled to the cash and stock dividends which were declared and payable on 24 Sep 2021; and c) could not vote in the stockholders meeting scheduled to take place on26Sept 2021. Was the action of the BOD on each of the foregoing matters valid?

no no no

The following are instances of acts of ownership in general partnership, except:

continue the partnership on the death, insanity or civil interdictionof a general partner

A bound himself to deliver to B a 65-inch 2022 model of TV set, and the18cubic feet of White Westinghouse refrigerator with motor no. WERT 385, which B saw in A’s store, and to repair B’s piano. A did not do any of these. S1 – A can be compelled to deliver the TV set. S2 – A can be compelled to deliver the refrigerator. S3 – A can be compelled to repair the piano.

S1 S2 true S3 false

The following are the requisites of voluntary liquidation of the individual debtor, except:

Acts of insolvency need not be alleged and proved

The corporate term of a stock corporation is that which is stated in its Articlesof Incorporation. It may be extended or shortened by an amendment of theArticles when approved by majority of its Board of Directors and:

ratified by at least 2/3 of the stockholders representing the outstanding capital stock.

High Earning Corporation filed a complaint against five of its officers for violation of Section 31 of the Revised Corporation Code. The corporationclaimed that the said officers were guilty of advancing their personal intereststo the prejudice of the corporation, and that they were grossly negligent inhandling its affairs. Aside from documents and contracts, the corporationalsosubmitted in evidence records of the officers‘ U.S. Dollar deposits in several banks overseas - Boston Bank, Bank of Switzerland, and Bank of NewYork. For their part, the officers filed a criminal complaint against the directors of High Earning Corporation for violation of Republic Act No. 6426, otherwiseknown as the Foreign Currency Deposit Act of the Philippines. The officersalleged that their bank deposits were illegally disclosed for want of a court order, and that such deposits were not even the subject of the case against them. Under the Bank Secrecy Law, can these foreign currency deposits beopened since they are subject matter of the litigation?

No, since the Bank Secrecy excludes FCDU accounts

For applications or requests for license, clearance, permit, certification or authorization requiring the approval of the local Sangguniang Bayan, Sangguniang Panlungsod, Sangguniang Panlalawigan, the processing timeis

45 working days

The full report of the personal data breach must be submitted

within five (5) days

X Corp., whose business purpose is to manufacture and sell vehicles, invested its funds in Y Corp., an investment firm, through a resolution of itsBoard of Directors. The investment grew tremendously on account of YCorp.'s excellent business judgment. But a minority stockholder in XCorp. assails the investment as ultra vires. Is he right and, if so, what is the statusof the investment?

Yes, it is an ultra vires act of the corporation itself but voidableonly, subject to stockholders’ ratification.

Under the Revised Corporation Code, an Emergency Board may be createdby a vote of _____________ to (purpose) _________ and it will be temporarily filled from the ___________ of the corporation

Majority, prevent grave, Officers

Which of the following corporate acts are valid, void, or voidable? i) XL Foods Corporation, which is engaged in the fast-food business, enteredinto a contract with its President Jose Cruz, whereby the latter would supplythe corporation with its meat and poultry requirements. ii) The Board of Directors of XL Foods Corporation declared and paid cashdividends without approval of the stockholders. iii) XL Foods Corporation guaranteed the loan of its sister company XL Meat Products, Inc.

Voidable, Valid, Void

XXX Bank Corporation and ZZZ Corporation were merged into XXZZBankCorporation. So as not to create any unnecessary conflict, all the former directors of both banks wanted to be appointed /elected as members of theBoard of Directors of the merged bank. Each bank used to have eleven (11) members of the board. The maximum number of directors of the mergedbankis

X is a minority stockholder of CCC Corporation. Y is a member of the Boardof Directors of CCC Corporation and at the same time he is the President. Xbelieves that Y is mismanaging CCC Corporation hence, as a stockholder andin behalf of the other stockholders, he wanted to sue Y. Which statement ismost accurate?

Derivative suit is an exclusive remedy that X can institute.

Which phrase best completes the statement - The affidavit of good faithinaDeed of Chattel Mortgage is

an oath where the parties swear that the mortgage is made for the purpose of securing the obligations specified and that the obligation is just and valid;

The provision aims at criminalizing the intentional hindering of the lawful useof computer systems including telecommunications facilities by using or influencing computer data.

System Interference

Which phrase best completes the statement - To bind third parties, a chattel mortgage of shares of stock must be registered?

with the Register of Deeds where the debtor resides and the principal office of the corporation.

If ABC Corporation will increase its authorized capital stock, the CorporationCode requires the approval of the SEC and -

the approval of the majority of the Board of Directors and approval of the shareholders holding 2/3 share of the outstanding capital stock.

A single-purpose cooperative may transform into a multi-purpose cooperativeand may create subsidiaries only after at least:

2 years of operation

No additional compensation other than per diems shall be paid to a director of a cooperative during of existence of any cooperative.

First year

In case of disagreement between the corporation and a withdrawing stockholder who exercises his appraisal right regarding the fair value of hisshares, a three-member group shall by majority vote resolve the issue withfinality. May the wife of the withdrawing stockholder be named to the threemember group?

No, the wife of the withdrawing shareholder is not a disinterestedperson

The following modes of extinguishment of obligations require two or morecreditors, except:

Dation in Payment

Under the Intellectual Property Code, lectures, sermons, addresses or dissertations prepared for oral delivery, whether or not reduced in writingor other material forms, are regarded as –

original works

Where no creditors are affected the cooperative may be voluntarily dissolvedby vote of the board of directors and by a resolution duly adopted by theaffirmative vote of the members with voting rights, present and constitutingaquorum at a meeting to be held upon call of the directors.

Majority; 3/4

In double sale of real property, priority is given to -

The one to whom who had it registered in good faith

In the following instances, the third person becomes part of the contract, except:

Delivery of the subject matter of the contract

Large scale in the Data Privacy Act is committed and the maximum penaltyinthe scale of penalties respectively provided in the offenses shall be imposed when the personal information ___________________________ is harmed, affected or involved as the result of the above mentioned actions.

of at least one hundred (100) persons

The contract shall be presumed to be an equitable mortgage in the following instances, except:

When the vendor retains for himself a part of the purchase price

The stockholders of People Power Inc (PPI) approved two resolutions inaspecial stockholders‘ meeting: a) Resolution increasing the authorized capital stock of PPI; and b) Resolution authorizing the BOD to issue, for cash payment, the new shares from the proposed capital stock increase in favor of outside investors who are non-stockholders. The foregoing resolutions wereapproved by stockholders representing 99% of the total outstanding capital stock. The sole dissenter was Jimmy Morato who owned 1%of the stock. Arethe resolutions binding on the corporation and its stockholders includingJimmy Morato, the dissenting stockholder?

No, While these resolutions were approved by the stockholders, the directors‘ approval, which is required by law in such case, does not exist.

Below are instances when legal compensation is not allowed, except:

One of the debts arises from mutuum

Instances when benefit to the creditor need not be proved if it redoundedor not to him, except:

If after payment, the debtor acquired the right to collect fromtheguarantor

Yes, because there is already a pending case and provided thesubpoena must be specific as to which account.

No member shall transfer his shares or interest in the cooperative or any part thereof unless he had held such share capital contribution or interest for not less than:

One year

The number of board of directors in a stock corporation

Minimum of 2, maximum of 15

An elected officer of a cooperative may be removed by

BOD

X, who is the Executive Vice President of ABC Corporation, a listed company, can be held liable or guilty of insider trading if, he -

All of the choices

A and B sold 1,000 sacks of rice to X and Y. On X’s request, A and Bdelivered the 1,000 sacks of rice to him. X resold the rice without turningover any part of it or its price to Y. What kind of obligation is present?

Joint divisible obligation

The number of trustees in a non-stock corporation

Minimum of 5, may be more than 15

ABC Corp. increased its capital stocks from Php10 Million to Php15 Millionand, in the process, issued 1,000 new shares divided into Common Shares"B" and Common Shares "C." T, a stockholder owning 500 shares, insists onbuying the newly issued shares through a right of pre-emption. The company claims, however, that its By-laws deny T any right of pre-emption. Is thecorporation correct?

No, since the By-Laws cannot deny a shareholder his right of pre- emption.

The common property of a universal partnership shall be

All the properties which belong to each of the partners at the time of the constitution of the partnership as well as the profits which they may acquire therewith.

S1 – The period for non-use of corporate charter is 5 years from the dateof filing the articles of incorporation. S2 – The period for non-use of a cooperative is 2 years from the issuance of the certificate of incorporation. S3 – No damages can be recovered for acts of infringement of a patent committed more than three (3) years before the institution of the action for infringement.

S2 and S3 are false, S1 is true

Upon the winding up of the cooperative affairs, any asset distributable toanycreditor, shareholder or member who is unknown or cannot be found shall begiven to the:

Federation or union to which the cooperative is affiliated with

Upon dissolution of a cooperative, what happens to the capital donated tosaid cooperative?

It is subject to escheat

Three of the following contracts are inexistent and void fromthe beginning. Which is the exception?

That where one of the parties is incapable of giving his consent toa contract.

S1 - Consent of parties is required in legal compensation. S2 - Consent of creditor is required in Substitution. S3 - In Dation in payment, the creditor becomes the owner of the property given. S4 - In Cession, creditors are only assignees

Only two statements are false

S1 – The period to extend the life of the corporation if fixed is 5 years beforeits expiration. S2 – The period to extend the life of a cooperative is 5 years prior to its expiration. S3 – The period to extend the patent is 6 months prior to its expiration.

S1 and S3 are false, S2 is true

A _______ grants property rights on an invention, allowing the holder to exclude others from making, selling, or using the invention.

patent

Which of the following is the least defective contract?

Rescissible

S1 - Report must done within lemon law rights period i.e. ending twelve(12) months from the date of subsequent delivery after repair to the consumer, or up to twenty thousand (20,000) kilometers of operation after such delivery , whichever comes first. S2 - The 250% rate must be paid to the worker in case the worker works onaholiday and it his rest day (230%)

Both are incorrect

X mortgaged her residential house and lot in favor of ABC Bank. Xdefaultedin her loan and so the bank foreclosed the real estate mortgage on the residential house. Y then bought the residential house and lot before theexpiration of the redemption period. Can Y now take possession of the property?

No, because it is still covered by the redemption period and thepurchaser is not yet entitled as a matter of right to take possession of theproperty.

The following are judicial grounds for the dissolution of partnership, except:

Insolvency of any partner

X can claim a total of Php500,000 for all the three (3) accounts.

Which of the following is an exception to the secrecy of bank deposits andother laws which are in Philippine Pesos, but not an exception to the secrecyof foreign currency deposits?

Upon inquiry in cases of impeachment

S1 - In case of projects involving mixed procurements, the nature of the supplier, shall be determined based on the primary purpose of the contract. S2 - The New SS Law likewise made it compulsory for Overseas Filipino workers, sea-based or land-based, to be members of the SSS as provided for under Section 9-B of R.A. No. 11199.

Both are correct

Under the Anti-Money Laundering Law, a covered institution is requiredtomaintain a system of verifying the true identity of their clients as well as persons purporting to act on behalf of

such clients

Applications or requests submitted by applicants or requesting parties of agovernment office or agency which only require ministerial actions on thepart of the public officer or employee, or that which present only inconsequential issues for the resolution by an officer or employee of said government.

Simple Transactions

S1 - Unless otherwise provided by the policy, an insurer is liable for a lossof which a peril insured against was the proximate cause, although a peril not contemplated by the contract may have been the remote cause of the loss. But the insurer is not liable for a loss of which the peril insured against wasonly a remote cause. S2 - A grievance procedure is mandatory provision in the CBA, otherwiseit isnot registrable. Until the parties include a grievance procedure, the Corporateregistration is deferred

S1 is correct, S2 is incorrect

Mr. AB offered in writing to sell his house and lot for P750,000.00 to Mr. CDon July 1, 2019. Mr. CD requested Mr. AB to give him 60 days within whichtoraise the P750,000.00. On August 15, 2019, Mr. AB informed Mr. CDthat theprice is raised and now at P1,000,000.00. Can Mr. CD compel Mr. ABtosell his house and lot at P750,000.00 which was offered in writing by Mr. AB?

No, because Mr. CD has not accepted the offer of Mr. AB.

X maintains a savings deposit in the amount of Php·1 Million with ABCBankCorporation. X also has obtained a loan from ABC Bank Corporation in theamount of Php1 Million. In case of default,

ABC Bank can set-off the loan from the savings account beingmaintained by X with ABC Bank

S1 – The period to notify the creation of the emergency board is within 5daysfrom the creation of the board. S2 – The period to report the election of the officers of the One Person Corporation is within 5 days from their appointment. S3 – The period to submit the certificate of stock for notation on the exerciseof appraisal right is within 10 days after the demanding for payment.

S2 and S3 are true, S1 is false

The following entities are not allowed to be a One Person Corporation (OPC), except:

Estate

The following are required to file their claims under the PDIC, except:

have not maintained the account under the name of business entities

The following instances are subject to suspensive condition, except:

Conventional redemption

S1 - An Asset Preservation Order is enforceable anywhere in the Philippines. S2 - On the reporting of covered transactions, the law mandates that coveredinstitutions shall report to the AMLC all covered transactions within five (5) working days from occurrence thereof. S3 - On record keeping under AMLA, the law states that all records of all transactions of covered institutions shall be maintained and safely storedfor five (5) years from the date of transactions.

All statements are true

AAA Corporation is a foreign corporation that wants to operate a representative office here in the Philippines. As required by the CorporationCode, there is a need to appoint a Resident Agent as a condition precedent tothe issuance of a license to transact business in the Philippines. After two(2) years, AAA Corporation removed its Resident Agent and did not appoint anyone anymore. Which statement is the most accurate?

This can be a ground for revocation or suspension of its licensetodo business

A partnership which compromises all the partners may acquire by their workor industry during the existence of the partnership is

Universal partnership of profits

A and B sold 1,000 sacks of rice to X and Y. On X’s request, A and Bdelivered the 1,000 sacks of rice to him. X resold the rice without turningover any part of it or its price to Y. From whom will Y ask for delivery of his share?

From A and B

Ralph and Vi orally agreed to form a partnership. Each contributed cashandpersonal properties worth P10,000 to a common fund. But they did not register the partnership with the Securities and Exchange Commission (SEC)

The partnership is still valid

A sold a parcel of land to B for P200,000. In the deed of sale, there is astipulation that the purchase price shall be paid on a certain date and that incase of failure to pay on a certain date, then the contract shall be automatically rescinded. The period arrived and B failed to pay as stipulatedin the contract.

The contract is not rescinded until there is notarial rescission

Which of the following obligations of the vendor cannot be waived?

To transfer ownership to the buyer

A and B sold 1,000 sacks of rice to X and Y. On X’s request, A and Bdelivered the 1,000 sacks of rice to him. X resold the rice without turningover any part of it or its price to Y. How much if any, can Y demand fromthe person/s liable?

500

M and N were very good friends. N borrowed P10,000 from M . Because of their close relationship, the promissory note executed by N provided that he would pay the loan “whenever his means permit.” Subsequently, Mand Nquarreled. M now seeks to collect the loan because he is in dire need of money.

No, he must first ask the court to fix the period

Which phrase best completes the statement - When a debt is secured by a real estate mortgage, upon default of the debtor?

the creditor can foreclose the mortgage and demand collection for any deficiency;

X is a depositor of AAA Bank. She has three (3) deposit accounts all under her name. One, in checking account, one in saving account and another one in time deposit account. Each account has a balance of Php250,000. AAA Bank became insolvent. Philippine Deposit Insurance Corporation closed the Bank. X therefore is unable to withdraw from all of the accounts. She then filed her claims with the Philippine Deposit Insurance Corporation. Which statement is most accurate? a. X can claim a total of Php500,000 for all the three (3) accounts. b. X can only claim from one (1) account of Php250,000. c. X can claim a total of Php750,000 from all the three (3) accounts. d. X cannot claim anything from any of the deposit accounts

a. X can claim a total of Php500,000 for all the three (3) accounts.

The Bank Secrecy Law (RA 1405) prohibits disclosing any information about deposit records of an individual without court order except - a. In an examination to determine gross estate of a decedent. b. In an investigation for violation of Anti-Graft and Corrupt Practices. c. In an investigation by the Ombudsman. d. In an impeachment proceeding.

a. In an examination to determine gross estate of a decedent.

X works as a research computer engineer with the Institute of Computer Technology, a government agency. When not busy with his work, but during office hours, he developed a software program for law firms that will allow efficient monitoring of the cases, which software program is not at all related to his work. Assuming the program is patentable, who has the right over the patent? a. X; b. Institute of Computer Technology; c. Neither X nor the Institute of Computer Technology can claim patent right over the invention; d. X and the employer of X will jointly have the rights over the patent.

a. X;

The "test of dominancy" in the Law on Trademarks, is a way to determine whether there exists an infringement of a trademark by - a. Determining if the use of the mark has been dominant in the market. b. Focusing on the similarity of the prevalent features of the competing marks which might create confusion. c. Looking at the mark whether they are similar in size, form or color. d. Looking at the mark whether there is one specific feature that is dominant

b. Focusing on the similarity of the prevalent features of the competing marks which might create confusion.

X's painting of Madonna and Child was used by her mother to print some personalized gift wrapper. As part of her mother's efforts to raise funds for Bantay Bata, the mother of X sold the wrapper to friends. Y, an entrepreneur, liked the painting in the wrapper and made many copies and sold the same through National Bookstore. Which statement is most accurate? a. Y can use the painting for his use because this is not a copyrightable material. b. X can sue Y for infringement because artistic works are protected from moment of creation. c. Works of art need to be copyrighted also to get protection under the law. d. Y can use the drawing even though not copyrighted because it is already a public property having been published already.

b. X can sue Y for infringement because artistic works are protected from moment of creation.

Compulsory Licensing of Inventions which are duly patented may be dispensed with or will be allowed exploitation even without agreement of the patent owner under certain circumstances, like national emergency, for reason of public interest, like national security, etc. The person who can grant such authority is - a. the Director General of the Intellectual Property Office; b. the Director of Legal Affairs of the Intellectual Property Office; c. the owner of the Patent right; d. Any agent of the owner of the Patent right.

b. the Director of Legal Affairs of the Intellectual Property Office;

The Fair Use Doctrine allows others to utilize copyrighted works under certain conditions. The factors to consider whether use is fair or not would be the purpose and character of the use, nature of the copyrighted work, amount and substantiality of the portions used, and what else? a. Effect of the use upon the creator of the work. b. Effect of the use upon the potential market of the work. c. Effect of the use upon the public in general. d. Effect of the use upon the class in which the creator belongs

b. Effect of the use upon the potential market of the work

XYZ Corporation bought ten (1 0) units of Honda Civic from CCC Corporation. ABC Bank granted a loan to XYC Corporation which executed a financing agreement which provided for the principal amount, the installment payments, the interest rates and the due dates. On due dates of the installment payments, XYZ Corporation was asked to pay for some handling charges and other fees which were not mentioned in the Financing Agreement. Can XYC Corporation refuse to pay the same? a. No, because handling charges and other fees are usual in certain banking transactions. b. Yes, because ABC Bank is required to provide XYZ Corporation not only the amount of the monthly installments but also the details of the finance charges as required by the Truth in Lending Act. c. No, because the Finance Agreement is a valid document to establish the existence of the obligation. d. Yes, because legally, finance charges are never allowed in any banking transaction.

b. Yes, because ABC Bank is required to provide XYZ Corporation not only the amount of the monthly installments but also the details of the finance charges as required by the Truth in Lending Act.

Which of the following is an exception to the secrecy of bank deposits which are in Philippine Pesos, but NOT an exception to the secrecy of foreign currency deposits? a. Upon Bangko Sentral ng Pilipinas (SSP) inquiry into or examination of deposits or investments with any bank, when the inquiry or examination is made in the course of the SSP's periodic special examination of said bank to ensure compliance with the Anti-Money Laundering Act (AMLA); b. Upon Philippine Deposit Insurance Corporation (PDIC) and SSP inquiry into and examination of deposit accounts in case there is a finding of unsafe or unsound banking practice; c. Upon inquiry in cases of impeachment; d. Upon inquiry by the Commissioner of Internal Revenue in the event a taxpayer files an application to compromise his tax liabilities on the ground of financial incapacity.

c. Upon inquiry in cases of impeachment;

The Anti-Money Laundering Law is a law that seeks to prevent money laundering activities by providing for more transparency in the Philippine Financial System, hence the following institutions are covered by the law, except: a. Bank and any financial institutions; b. Pawnshops; c. Casino operators; d. All of the above

c. Casino operators

For purposes of determining violation of the provisions of Anti-Money Laundering Law, a transaction is considered as a "Suspicious Transaction" with "Covered Institutions" regardless of the amount involved, where which the following circumstances exist/s? a. the amount involved is not commensurate with the client's business or financial capacity; b. there is no underlying legal or trade obligation, purpose or economic justification; c. client is not properly identified; d. All of the above

d. All of the above

The main feature of the Foreign Investment Act of 1991 is to introduce the concept of "Negative Lists". Under the said law, what is a "Negative List"? a. It is a list of business activities or enterprises in the Philippines that foreigners are disqualified to engage in. b. It is a list of business activities or enterprises in the Philippines that foreigners are qualified to engage in. c. It is a list of business activities or enterprises that are open to foreign investments provided it is with the approval of the Board of Investment. d. It is a list of business activities or enterprises that are open to foreign investments provided it is with the approval of the Securities and Exchange Commission.

a. It is a list of business activities or enterprises in the Philippines that foreigners are disqualified to engage in.

May a publicly listed universal bank own 100% of the voting stocks in another universal bank and in a commercial bank? a. Yes, if with the permission of the Bangko Sentral ng Pilipinas b. No, since it has no power to invest in equities. c. Yes, as there is no prohibition on it. d. No, since under the law, the 100% ownership on voting stocks must be in either bank only

d. No, since under the law, the 100% ownership on voting stocks must be in either bank only.

Under the Intellectual Property Code, lectures, sermons, addresses or dissertations prepared for oral delivery, whether or not reduced in writing or other material forms, are regarded as a. Non-original works. b. Original works. c. Derivative works. d. Not subject to protection.

b. Original works.

T is the registered trademark owner of "CROCOS" which he uses on his ready-to-wear clothes. Banking on the popularity of T's trade mark, B came up with his own "CROCOS" mark, which he then used for his "CROCOS" burgers. T now sues B for trademark infringement but B argues that his product is a burger, hence, there is no infringement. Is B correct? a. No, since the owner of a well-known mark registered in the Philippines has rights that extends even to dissimilar kinds of goods. b. Yes, since the right of the owner of a well-known mark registered in the Philippines does not extend to goods which are not of the same kind. c. Yes, as B was in bad faith in coming up with his own "CROCOS" mark. d. No, since unlike T, he did not register his own "CROCOS" mark for his product.

a. No, since the owner of a well-known mark registered in the Philippines has rights that extends even to dissimilar kinds of goods.

Under the Financial Rehabilitation and Insolvency Act (FRIA), the filing of a petition for voluntary rehabilitation must be approved by: a. a majority vote of the Board of Directors and authorized by the vote of the stockholders representing at least a majority of the outstanding capital stock b. a majority vote of the Board of Directors and authorized by the vote of the stockholders representing at least two-thirds of the outstanding capital stock c. two-thirds vote of the Board of Directors and authorized by the vote of the stockholders representing at least a majority of the outstanding capital stock d. two-thirds vote of the Board of Directors and authorized by the vote of the stockholders representing at least two-thirds of the outstanding capital stock

b. a majority vote of the Board of Directors and authorized by the vote of the stockholders representing at least two-thirds of the outstanding capital stock

X, who is the Executive Vice President of ABC Corporation, a listed company, can be held liable or guilty of insider trading if, he - a. Bought shares of ABC Corporation when it was planning to acquire another company to improve its asset base, the news of which increased the price of the shares in the Stock Exchange. b. Bought shares of XYC Corporation, a sister company of ABC Corporation when he learned that XYC Corporation was about to also list its share in the Philippine Stock Exchange. c. Bought shares of ZZZ Corporation when he learned that ABC Corporation would acquire ZZZ Corporation. d. All of the above.

d. All of the above.

The purpose of the "Tender Offer" Rule is to - a. Ensure an even playing field for all shareholders of a company in terms of opportunity to sell their shareholdings. b. Ensure that minority shareholders in a publicly listed company are protected in the sense that they will equally have the same opportunity as the majority shareholders in terms of selling their shares. c. Ensure that the shareholders who would also want to sell their shareholdings will have the opportunity for a better price. d. All of the above

d. All of the above.

Section 38 of The Securities Regulation Code defines an independent director as a person who must not have a relation with the corporation which would interfere with his exercise of independent judgment in carrying out the responsibilities of a director. To ensure independence therefore, he must be - a. Nominated and elected by the entire shareholders; b. Nominated and elected by the minority shareholders; c. Nominated and elected by the majority shareholders; d. Appointed by the Board.

c. Nominated and elected by the majority shareholders;

"Securities" issued to the public are required by law to be registered with - a. The Bangko Sentral ng Pilipinas; b. The Philippine Stock Exchange; c. The Securities and Exchange Commission; d. The Securities and Exchange Commission and the Philippine Stock Exchange.

c. The Securities and Exchange Commission

The government agency granted with the power of supervision and examination over banks and non-bank financial institutions performing quasi-banking functions, to ensure that the conduct of its business is on a sound financial basis that will provide continued solvency and liquidity is - a. The Philippine Deposit Insurance Corporation; b. The Bangko Sentral ng Pilipinas; c. The Anti-Money Laundering Council; d. The Securities and Exchange Commission.

b. The Bangko Sentral ng Pilipinas;

X maintains a savings deposit in the amount of Php·1 Million with ABC Bank Corporation. X also has obtained a loan from ABC Bank Corporation in the amount of Php1 Million. In case of default, a. ABC Bank can set-off the loan from the savings account being maintained by X with ABC Bank. b. Set-off is not possible because legal compensation is not allowed in banking transaction. c. Deposit accounts are usually earmarked for specific purpose hence offsetting is not legally possible. d. Off -setting is not possible because the obligation of X is a "simple loan".

a. ABC Bank can set-off the loan from the savings account being maintained by X with ABC Bank.

XYZ Corporation is engaged in lending funds to small vendors in various public markets. To fund the lending, XYZ Corporation raised funds through borrowings from friends and investors. Which statement is most accurate? a. XYZ Corporation is a bank. b. XYZ Corporation is a quasi-bank. c. XYZ Corporation is an Investment Company. d. XYZ is none of the above

b. XYZ Corporation is a quasi-bank

XXX Bank Corporation and ZZZ Corporation were merged into XX ZZ Bank Corporation. So as not to create any unnecessary conflict, all the former directors of both banks wanted to be appointed /elected as members of the Board of Directors of the merged bank. Each bank used to have eleven (11) members of the board. The maximum number of directors of the merged bank is a. 15; b. 22; c. 21; d. 11.

c. 21;

All senior officers of ABC Bank are entitled to obtain a housing loan. X is an Executive Vice President for Operations of ABC Bank. She obtained a housing loan with the ABC Bank. Which statement is most accurate? a. The housing loan of X requires a guarantor from somebody who is not connected with the bank. b. The housing loan of X requires the approval of the Board of Directors of the bank. c. The housing loan of X, being a benefit for employees, does not require (a) but will require (b). d. The housing loan of X, being a benefit for employees, will not require (a) and (b)

d. The housing loan of X, being a benefit for employees, will not require (a) and (b)

ABC Holdings Company, a Hong Kong company, owns 10% of XYZ Bank. Because of the peace and order situation in the Philippines, ABC Holding Company wanted to sell its shareholdings in XYZ Bank. Unfortunately, nobody is interested to buy a 1 0% shareholdings in a bank. The board of directors of XYZ Bank thought that it would be a good idea to buy back the shares owned by ABC Holding Company. Which statement is most accurate? a. Buying back the shares by XYZ Bank is absolutely not allowed. b. Buying back the shares may be allowed provided it is with the approval of the Monetary Board and disposed of within six (6) months. c. Buying back the shares may be allowed provided such shares 'will be disposed of within ten (1 0) years. d. Buying back the shares may be done anytime provided the Board of Directors will approve the same.

b. Buying back the shares may be allowed provided it is with the approval of the Monetary Board and disposed of within six (6) months.

X is being charged for violation of Anti-Graft and Corrupt Practices because he is suspected of having accumulated unexplained wealth. X maintains deposit accounts with ABC Bank. The Ombudsman filed criminal cases against X before the Sandiganbayan. Can the Court issue subpoenas against ABC Bank to produce all documents pertaining to all the deposit accounts of X? a. Yes, because there is already a pending case and provided the subpoena must be specific as to which account. b. Yes, it is enough that the specific bank is identified. c. No, because the issuance of the subpoena has no real legal basis. d. Even without a subpoena, information about the deposit accounts of X can be submitted to the Sandiganbayan because it will be used in a pending case

a. Yes, because there is already a pending case and provided the subpoena must be specific as to which account

X, a private individual, maintains a dollar deposit with ABC Bank. X is suspected to be the leader of a Kidnap for Ransom Gang and he is suspected of depositing all ransom money in said deposit account which are all in US Dollars. The police want to open said account to know if there are really deposits in big amounts. Which statement is most accurate? a. The same rules under Secrecy of Bank Deposit Act will apply. b. An approval from the Monetary Board is necessary to open the account. c. Because the deposit is in US Dollars, it is covered by the Foreign Currency Deposit Act which allows disclosure only upon the written permission of the depositor. d. Approval from the Court is necessary to order disclosure of the account

a. The same rules under Secrecy of Bank Deposit Act will apply

a. X can claim a total of Php500,000 for all the three (3) accounts

a. In an examination to determine gross estate of a decedent

Under the Anti-Money Laundering Law, a covered institution is required to maintain a system of verifying the true identity of their clients as well as persons purporting to act on behalf of a. Those doing business with such clients. b. Unknown principals. c. The covered institution. d. Such clients

d. Such clients

``` A bank can be placed under receivership when, if allowed to continue in business, its depositors or creditors would incur a. probable losses b. inevitable losses c. possible losses d. a slight chance of losses ```

a. probable losses

Apart from economic rights, the author of a copyright also has moral rights which he may transfer by way of assignment. The term of these moral rights shall last a. During the author's lifetime and for 50 years after his death. b. Forever. c. 50 years from the time the author created his work. d. During the author's lifetime.

a. During the author's lifetime and for 50 years after his death.

X invented a device which, through the use of noise, can recharge a cellphone battery. He applied for and was granted a patent on his device, effective within the Philippines. As it turns out, a year before the grant of X's patent, Y, also an inventor, invented a similar device which he used in his cellphone business in Manila. But X files an injunctive suit against Y to stop him from using the device on the ground of patent infringement. Will the suit prosper? a. No, since the correct remedy for X is a civil action for damages. b. No, since Y is a prior user in good faith. c. Yes, since X is the first to register his device for patent registration. d. Yes, since Y unwittingly used X’s patented invention.

b. No, since Y is a prior user in good faith.

It is a legal scheme whereby a debtor, who has sufficient assets but who may be unable to meet his obligations as and when they fall due, may petition for more time within which to settle such obligations. a. Insolvency Proceedings b. Suspension of Payments c. Corporate Rehabilitation d. Voluntary Insolvency

b. Suspension of Payments

Samsung invented a cellular phone that can also play digital music or MP3s. It applied for the issuance of letters patent. a. The invention is not patentable because it is a combination of old functions which does not produce a new result. b. The invention is patentable because it is a new product which is beneficial to the public. c. The invention is not patentable because Samsung is a foreign corporation and it should file its application in its home country. d. The invention is patentable because it combines existing elements, a cellular phone and a digital music player, and produces a new and useful result, namely, the convenience of having two gadgets in one.

d. The invention is patentable because it combines existing elements, a cellular phone and a digital music player, and produces a new and useful result, namely, the convenience of having two gadgets in one.

Lucky Me registered its trademark, “Ang Sarap Pancit Palabok” with the Intellectual Property Office. Nissin subsequently introduced its new product, “Ang Sarap Pinoy Ramen”. Lucky Me sued for trademark infringement. a. Nissin is not guilty of trademark infringement because the trademark “Ang Sarap” is descriptive, hence not capable of exclusive appropriation. b. Nissin is not guilty of trademark infringement because its product, Pinoy Ramen, belongs to a different category from Lucky Me’s product, Pancit Palabok. c. Nissin is guilty of trademark infringement because it did not register its trademark “Ang Sarap Pinoy Ramen”. d. Nissin is guilty of trademark infringement because the trademark “Ang Sarap” is fanciful and arbitrary, hence capable of exclusive appropriation.

d. Nissin is guilty of trademark infringement because the trademark “Ang Sarap” is fanciful and arbitrary, hence capable of exclusive appropriation.

Center Book Store is the publisher of the book Legal Journal. It donated one copy to the Library of the U.E. College of Law. The Library, in order to preserve the original book, reproduced one copy of the Journal for lending to the University’s students for room use. Is the U.E. Law Library liable for copyright infringement? a. No. The reproduction is consistent with fair use. b. Yes. Only the National Library is allowed to reproduce books and other works. c. No. The copy of the Journal is marked “For Room Use Only” and is therefore not made available to the public outside of the Library. d. Yes. The law only allows a library to photocopy a book if it is fragile or rare.

c. No. The copy of the Journal is marked “For Room Use Only” and is therefore not made available to the public outside of the Library.

Which among the following is not a function of the Bangko Sentral ng Pilipinas? a. As official depositary of the Philippine government. b. As financial adviser of the Philippine government. c. As fiscal agent of the Philippine government. d. As the watchdog of government funds

d. As the watchdog of government funds

No. 1 – A bank may be may lend to a single borrower more than fifteen (15%) of the bank’s unimpaired capital. No. 2 – A deposit in a bank in foreign currency may be inquired into provided the depositor gives his consent, orally or in writing. a. Both are false. b. Both are true. c. No. 1 is true; no. 2 is false. d. No. 1 is true; no. 2 is false.

a. Both are false.

. No. 1 - The Ombudsman may inquire into the bank deposit of a public officer whose case is pending criminal investigation in the Ombudsman even if there is no actual case filed in court. No. 2 - A writ of garnishment directed to a bank deposit is prohibited by law. a. Both are false. b. Both are true. c. No. 1 is false; No. 2 is true. d. No. 1 is true; No. 2 is false

a. Both are false

It is a bank which creates or accepts demand deposits subject to withdrawal by checks and primarily organized to carry on the business of accepting drafts and issuing letters of credit, discounting and negotiating promissory notes, receiving deposits, buying and selling foreign exchange and gold and silver bullion and lending money against the borrower’s security in property. a. Rural bank; b. Thrift bank; c. Universal bank; d. Commercial bank

d. Commercial bank

Jose and his wife, Perla, opened and maintained the following accounts with Allied Bank Recto. (a) Savings deposit – P300,000; (b) Demand deposit – P400,000; (c) Time deposit - P350,000. They also have the same deposits with the same amount in Allied Bank Makati. If Allied bank becomes insolvent the Philippine Deposit Insurance Corporation will be bound to be liable to the spouses for its insurance liability equivalent to a. Two deposits. b. One deposit. c. Six deposits. d. Three deposits

b. One deposit.

Which of the following is a proper defense against the application of the "short-swing" profit rule? a. That the sale or purchase was not the result of information obtained by such owner, officer, director or beneficial owner because of his or her position. b. That one was no longer an officer at the time of either the sale or purchase of the securities. c. That the same was not sold or purchased within the statutory three month period. d. That the beneficial owner was not such both at the time of the purchase and the sale.

d. That the beneficial owner was not such both at the time of the purchase and the sale.

Which among the following securities transactions require that the securities be registered in order to be compliant with the Securities Regulation Code? a. A sale of capital stock of a corporation to its own stockholders only where no fee is paid in connection with the sale. b. A bank selling its own securities. c. An insurance company selling its own securities. d. The transaction of a broker on the PSE pursuant to his client's orders.

b. A bank selling its own securities.

The General Banking Law of 2000 applies – a. To all types of banks in suppletory manner. b. Only to banks which are not government owned or controlled. c. To savings and mortgage banks, non-stock savings and loans associations, and private development banks. d. To the operation of branches of foreign banks in the Philippines

d. To the operation of branches of foreign banks in the Philippines

Which of the following negates a charge that an entity is engaged in banking business? a. If it obtains funds only from qualified depositors. b. If it invests, rather than lends, the funds obtained. c. If at any given time, the number of depositors falls below twenty (20). d. If it has not obtained the requisite authority to operate as such from the Bangko Sentral ng Pilipinas.

b. If it invests, rather than lends, the funds obtained.

The distinction between deposits and deposit substitutes is material in determining – a. Whether an entity accepting either one is subject to supervision by the BSP. b. Whether a commercial bank that accepts both will need a separate license from the BSP. c. What degree of diligence a bank is required to exercise in handling the same. d. Whether a universal bank may use the same purposes of lending or relending, as the case may be.

c. What degree of diligence a bank is required to exercise in handling the same.

A bank teller fails to observe the standard procedures of a bank in verifying the signature of the drawer of a check and honors the same when presented for payment by a person who forged the signature of the drawer on the check entrusted to him. What defense can a bank raise to negate or mitigate its liability to the drawer whose signatures was forged. a. The drawer is guilty of contributory negligence. b. The act of the bank teller is unauthorized.

a. The drawer is guilty of contributory negligence.

A bank is NOT liable for its failure to observe the degree of diligence as required by its fiduciary duty under Sec. 2 of the GBL of 2000. a. If such failure was prior to the enactment of the GBL of 2000. b. If no actual damage was suffered by the depositor. c. If the transaction involves money market placements. d. If there is a contractual stipulation between the bank and the depositor supported by valuable consideration which lowers the degree of diligence required to be exercised by the bank to that of a good father of family.

c. If the transaction involves money market placements.

A bank may be deemed as a mortgagee in good faith if it does not – a. Ascertain the mortgagor’s title or ownership over the property mortgaged. b. Ascertain the identity of the person borrowing the owner’s duplicate original title of property mortgaged before allowing such person to borrow such title for photocopying purposes. c. Check both the owner’s duplicate original title to the property mortgaged and the title thereof in the registry of deeds. d. Conduct an ocular inspection of the property, provided there is nothing in the title to the property which would arouse suspicion and require an ocular inspection.

b. Ascertain the identity of the person borrowing the owner’s duplicate original title of property mortgaged before allowing such person to borrow such title for photocopying purposes.

A universal bank and a commercial bank differ in terms of their power – a. To invest in non-financial allied enterprises. b. To create and accept demand deposits. c. To act as investment house. d. To perform quasi-banking functions.

c. To act as investment house.

Rural banks and cooperative banks essentially differ in terms of – a. Purpose. b. Powers. c. Governing law in matters other than organization, ownership, capital requirements, powers, supervision, and general conduct of business. d. Being authorized to create or accept demand deposits even without Monetary Board approval.

a. Purpose.

The distinction between the three modes of entry of foreign banks in the Philippines under the Foreign Banks Liberalization Act is material in determining – a. Whether or not a foreign bank may avail of more than one mode of entry. b. Whether or not Monetary Board Approval is required for such entry. c. Whether or not head office guarantee is required. d. Whether or not the foreign bank shall perform the same functions enjoy the same privileges, and be subject to the same limitations imposed upon a Philippine bank of the same category.

c. Whether or not head office guarantee is required.

The head office of a foreign bank authorized to operate branches in the Philippines is sued in a Philippine court by a payee of a check drawn by a depositor of the Philippine branch of such foreign bank which refused to honor a check notwithstanding that funds were sufficient. What defense can the head office raise to avoid liability to such payee? a. Philippine courts have no jurisdiction over the head office of the foreign bank. b. The head office of a foreign bank is not liable for the unauthorized acts of its Philippine branch. c. The head office guarantee is applicable only to liabilities to depositors. d. The bank is not liable to the payee for dishonor of checks.

d. The bank is not liable to the payee for dishonor of checks.

That a deposit is in the nature of a loan – a. Is inconsistent with the fiduciary duty imposed on banks in the handling thereof. b. Means that the same may be classified as a preferred credit. c. Means that the bank which has loaned the depositor money has a right to compensation if both loan obligations are already due and demandable, even without prior consent of the depositor. d. Means that in cases where banks are placed under receivership or liquidation, a depositor has no other means to recover on his deposit except through such receivership and liquidation proceedings where he will be treated as a creditor of the bank.

c. Means that the bank which has loaned the depositor money has a right to compensation if both loan obligations are already due and demandable, even without prior consent of the depositor

A time deposit differs from a demand deposit in that – a. Numbered accounts are not allowed for time deposits, but are allowed for demand deposits. b. Instruments issued pursuant to a time deposit are generally non-negotiable, while instruments issued pursuant to a demand deposit are negotiable. c. Funds in time deposit account earn interest, while funds in a demand deposit account cannot earn interest. d. Funds in a time deposit account cannot be withdrawn at any time, while funds in a demand deposit account can.

d. Funds in a time deposit account cannot be withdrawn at any time, while funds in a demand deposit account can.

A bank dishonors a check drawn against an account with insufficient funds. Under which circumstances can the bank be held liable for such dishonor? a. If the depositor has another account in the bank with sufficient funds to cover the amount of the check drawn but the bank did not apply such funds to cover said check. b. If the bank did not notify the depositor that it had previously availed of its legal right to compensation and applied the funds in the checking account in payment of depositor’s loan to the bank resulting in the insufficiency of the funds to cover the amount of the check drawn. c. If before dishonoring the check, the bank did not notify the depositor that his funds are insufficient to cover the amount of the check drawn as to give him an opportunity to deposit sufficient funds. d. If the bank does not allow the depositor to deposit the funds needed to cover the check drawn within a reasonable time after presentment in order to avoid dishonor of said check.

b. If the bank did not notify the depositor that it had previously availed of its legal right to compensation and applied the funds in the checking account in payment of depositor’s loan to the bank resulting in theinsufficiency of the funds to cover the amount of the check drawn.

A Bank is liable to the depositor if it allows withdrawal of the funds in the depositor’s account by someone who is not actually authorized by the depositor, but who – a. Presents the passbook and a withdrawal slip signed by the depositor. b. Surrenders the certificate of time deposit. c. Appears as an authorized signatory of a corporate depositor in the latest board resolution submitted to the bank, but is actually no longer connected with the corporate depositor. d. Appears in the bank records as the depositor but is actually merely a trustee for the true owner of the funds.

b. Surrenders the certificate of time deposit.

What can a bank lawfully do or omit to do without violating its duty to exercise extraordinary diligence in the handling of deposits? a. Allowing a crossed check to be cashed provided that the payee is personally known to the bank. b. Accepting as deposit a check which is not indorsed by the payee, provided that the check is a manager’s check. c. Closing a demand deposit account with prior notice to a depositor who has been misusing such account repeatedly overdrawing against it. d. Disclosing information regarding “and/or” savings account where one of the two depositors has given his written permission for such disclosure.

d. Disclosing information regarding “and/or” savings account where one of the two depositors has given his written permission for such disclosure.

The right to secrecy of bank deposits – a. Being part of municipal law, does not apply to deposits in branches of foreign banks in the Philippines. b. Is a constitutional right which may, however, be regulated by statute. c. Cannot be invoked in the absence of an express statutory provision. d. If violated will render the information obtained thereby inadmissible as evidence in any proceeding against the depositor.

c. Cannot be invoked in the absence of an express statutory provision.

A public officer is charged with violation of the anti-graft and corrupt practices act before the Office of the Ombudsman. The Ombudsman requests a bank to disclose information regarding the accounts in the name of the public officer’s immediate family. What principle or ground may the bank invoke to resist such inquiry? a. An inquiry into bank deposits cannot be had at the preliminary investigation level. b. No inquiry into bank deposits can be had in the absence of a court order. c. No inquiry can be made except into bank accounts of the person charged. d. The office of the Ombudsman has no power to inquire into bank deposits.

a. An inquiry into bank deposits cannot be had at the preliminary investigation level.

An ex-president of the Philippines is accused of committing the crimes of plunder and money laundering in the course of the proceedings, the Office of the Special Prosecutor filed a Motion with the Sandiganbayan for the issuance of an order directing the examination of such ex-President’s U.S. Dollar account. What ground can be validly invoked by the ex-president to oppose such motion? a. A foreign currency deposit cannot be inquired without the consent of the depositor. b. Plunder is not an exception to the prohibition against disclosure under the Foreign Currency Deposit Act. c. Money Laundering is not an exception to the prohibition against disclosure under the Foreign Currency Deposit Act. d. Assuming that money laundering is an exception to the prohibition against disclosure under the Foreign Currency Deposit Act, the court must first find probable cause of money laundering since the instant charges do not fall within the cases where no court order is required.

b. Plunder is not an exception to the prohibition against disclosure under the Foreign Currency Deposit Act.

Are rebroadcasting and retransmission protected intellectual property rights? a. No. Since rebroadcasting and retransmission are forms of copyright infringement b. Yes. Since Rebroadcasting and retransmissions are allowed under the must-carry rule. c. Rebroadcasting is not a protected intellectual property right due to the must-carry rule whereas retransmissions are protected copyrights. d. Rebroadcasting is a protected intellectual property right whereas retransmissions are not protected copyrights due to the must-carry rule

d. Rebroadcasting is a protected intellectual property right whereas retransmissions are not protected copyrights due to the must-carry rule.

XX applied for the issuance of a preliminary injunctive order on the ground that she is entitled to the use of the trademark on product A and its container based on her copyright and patent over the same. Can she do this? a. Yes. These are registrable marks b. No. These are not registrable marks c. Yes, although its copyrightability and patentability should be registered separately d. No. These are rights which are not interchangeable. The granting of one right will not necessarily apply to the other rights.

d. No. These are rights which are not interchangeable. The granting of one right will not necessarily apply to the other rights.

Which of the following are not included under technology transfer arrangements under the IP code? a. the licensing of a new management program in favor of a Philippine company b. the exact process of how to create a new and improved child-proof paint c. the secret ingredient of the KFC original recipe chicken. d. the use of Windows software in businesses.

d. the use of Windows software in businesses.

Which of the following are patentable medicines? a) the mere discovery of a new form or new property of a known substance which does not result in the enhancement of the known efficacy of that substance, b) the mere discovery of any new property or new use for a known substance, c) the mere use of a known process resulting in a new product that employs at least one new reactant. d) the mere use of a known process unless such known process results in a new product

c) the mere use of a known process resulting in a new product that employs at least one new reactant

A files a patent application for product Z, a revolutionary computer chip which is capable of outperforming current chips by as much as 10x. A is employed by company B, a software company. A’s job is to develop software programs for businesses. He developed this chip during office hours and days where he was researching for software ideas which he would use for his job. B filed its application over the same product at the day after A filed his patent. Who owns the patent? a. A since A filed his patent first. b. B since A made his chip during office hours and days. c. A since A made the chip not in the course of regular duties. d. B since A made the chip during office hours and utilized B’s resources.

c. A since A made the chip not in the course of regular duties.

A is a holder of patent X. B also holds a patent over X. A trial ensued and B was declared the true owner of the patent. What are the remedies for B? a. Upon filing a motion in court, the court shall order for his substitution as patentee b. the court shall order for his substitution as patentee, or at the option of the court, cancel the patent, and award actual and other damages in his favor if warranted by the circumstances, c. the court shall order for his substitution as patentee, or at the option of the true inventor, cancel the patent, and award actual and other damages in his favor if warranted by the circumstances d. Upon a petition by the true inventor, cancel the patent, and award actual and other damages in his favor if warranted by the circumstances.

c. the court shall order for his substitution as patentee, or at the option of the true inventor, cancel the patent, and award actual and other damages in his favor if warranted by the circumstances

Which of the following are rights conferred by a patent? a. Where the subject matter of a patent is a product, to restrain, prohibit and prevent any unauthorized person or entity from making, using, offering for sale, selling or importing that product; b. Where the subject matter of a patent is a process, to restrain, prevent or prohibit any unauthorized person or entity from using the process, and from manufacturing, dealing in, using, selling or offering for sale, or importing any product obtained directly or indirectly from such process. c. Patent owners shall have the right to assign, or transfer by succession the patent, and to conclude licensing contracts for the same d. All of the above

d. All of the above

Which of the following requisites are not included for an invention to be patentable? a. It is New, it has an inventive step, and it does not form part of a prior art b. It is New, it has an inventive step, and it is industrially applicable c. It is new, it does not form part of a prior art and it is registered d. None of the above

b. It is New, it has an inventive step, and it is industrially applicable

A Scientist has managed to create a new breed of pigs by altering its DNA of which such has never existed prior to such act by the scientist. Is the pig breed patentable? a. No. Since it is immoral b. Yes. Since the pig was created purely by the hand of the scientist c. No. Since animal breeds are not patentable d. Yes. Although the animal breeds are not patentable, the essential micro-biological process is patentable

c. No. Since animal breeds are not patentable

Are Computer programs never patentable? a. No. Computer programs are always patentable b. Yes. Section 22 is explicit on this c. No. Computer programs may be patentable provided it forms part of a process d. Yes. It contains non-patentable elements

c. No. Computer programs may be patentable provided it forms part of a process

A filed a patent in Malaysia over his invention on January 8, 2009. He subsequently filed a patent in the Philippine IPO on March 30, 2009, expressly claiming priority. Apparently, B has also filed a patent pertaining to the same invention on February 18, 2009. Who has priority right over the patent? a. A since he filed his patent in Malaysia earlier and also he has claimed priority expressly. b. B since a patent application in a foreign country has no effect here in the Philippines c. A since he filed his patent in Malaysia earlier and also he has claimed priority expressly, and it is within 12 months from the initial registration in Malaysia. d. B since he was the first one to file his registration in the Philippines

c. A since he filed his patent in Malaysia earlier and also he has claimed priority expressly, and it is within 12 months from the initial registration in Malaysia.

A was able to invent a new type of vehicle. However, B was able to register the invention first although it was clearly A who was the true inventor. What remedy may A avail of? a. He will file a civil case of patent infringement b. He can file for cancellation of patent plus damages c. He can file for the substitution as the real patentee d. Both A and C

b. He can file for cancellation of patent plus damages

A medicine already being distributed both in the U.S. and in the Philippines by distributor VX authorized by the patent holder is now being imported by A, a doctor who operates a small clinic and is using the drug for the treatment of his patients. Is A liable for patent infringement? a. Yes. A is liable since VX is the only authorized distributor of the patented drug. b. No. A is not liable since section 72 (1) allows such use of the product. c. Yes. A is liable since he is not an authorized distributor of the product. d. No. A is not liable since this is a case of fair use.

b. No. A is not liable since section 72 (1) allows such use of the product.

A has been importing patented medical drugs from Thailand. The patent is owned by B. B has a local distribution unit in the Philippines. B wants to file a case of patent infringement and importation of counterfeit drugs against A. Will this prosper? a. No. This is a case of fair use b. Yes. A counterfeit drug is a form of infringement against the patent of B. c. No. An unregistered drug is not the same as a counterfeit drug and also that section 72 (1) allows such importation by a 3rd party. d. Yes. B has not authorized A to distribute the products.

c. No. An unregistered drug is not the same as a counterfeit drug and also that section 72 (1) allows such importation by a 3rd party.

When a device appropriates a prior invention by incorporating its innovative concept and, although with some modification and change, performs substantially the same function in substantially the same way to achieve substantially the same result, what test should be applied? a. Literal infringement test b. Denicola test c. Doctrine of Equivalents test d. Fair Use test

c. Doctrine of Equivalents test

B was selling a product of A who was the patent holder of B’s product. Apparently, B has been passing A’s patent as his. A filed a criminal case of infringement against B. will this prosper? a. Yes. A is the rightful owner of the patent b. No. B is exempted under the fair use doctrine c. Yes. A never authorized B to sell such products as his. d. No. B has yet to be found guilty of a previous infringement, hence A has no cause of action.

d. No. B has yet to be found guilty of a previous infringement, hence A has no cause of action

A utility model lasts for: a. 20years non-renewable b. 5 years, renewable for another 2 consecutive terms. c. 7 years, renewable for another 2 consecutive terms. d. 7 years non-renewable

d. 7 years non-renewable

The provisions of compulsory licensing provides for instances where the patent holder is required to grant a license to the government or to a 3rd party. Is this provision unfair for depriving the patent holder of his right to his property? a. No. This is a case of eminent domain. b. Yes. This is a case of depriving the patent holder of his property without due process of law c. No. The patent holder is not deprived of his rights to the patent since he will still receive royalties for his patents. d. Yes. The patent holder has exclusive rights over his patents and such exclusivity is rendered inutile by the provision.

c. No. The patent holder is not deprived of his rights to the patent since he will still receive royalties for his patents.

Q: Which of the following types of names confer the greatest chance of being a valid trademark? a. Generic b. Descriptive c. Suggestive d. Arbitrary/Fanciful

d. Arbitrary/Fanciful

Businessman A puts up a sari-sari store named “Andongs”. B also puts up a sari-sari store named “Andongs” a month later. Can A filed against B an infringement case? a. Yes. A can file an infringement case against B for unlawfully using his tradename. b. No. He has not registered his tradename. c. Yes. This is a case of unfair competition. d. No. He has not registered his trademark.

a. Yes. A can file an infringement case against B for unlawfully using his tradename.

When testing whether the likelihood of deception has occurred, at what point of a transaction do we consider such likelihood? a. After the sale of the item bearing the mark. b. Prior to the sale of the item bearing the mark. c. At the point of the sale of the item bearing the mark. d. None of the above.

c. At the point of the sale of the item bearing the mark

When is non-use of a mark excusable? a. It must always be used, failure to use it for any reason will forfeit the use of such mark. b. When the trademark owner is lacking in funds due to slow sales. c. When the trademark owner has already registered his mark with the IPO d. When the cause of such non-use is due to reasons independent of the will of the trademark owner.

d. When the cause of such non-use is due to reasons independent of the will of the trademark owner.

Which among the following statements is false? a. Infringement of trademark is the unauthorized use of a trademark, whereas unfair competition is the passing off of one’s goods as those of another. b. In infringement of trademark, fraudulent intent is unnecessary, whereas in unfair competition, fraudulent intent is essential. c. In infringement of trademark and in unfair competition, prior registration are both necessary. d. In infringement of trademark and in unfair competition, prior registration to both are not necessary

c. In infringement of trademark and in unfair competition, prior registration are both necessary.

Suppose an author published a book describing a new method of book-keeping, which of the following statements is true? a. The author has a copyright over the book as well as the method described in his book; thus, he is able to preclude others from only copying the book as well as preclude others from employing the method as described in the book without his permission. b. The author has an exclusive right to the method described in the book. c. The extent of the author’s copyright is limited to him being able to prevent third persons from copying portions of his work; he is unable to prevent third persons from employing or describing the method discussed in such book. d. The extent of the copyright extends to the idea itself, not merely the expression

c. The extent of the author’s copyright is limited to him being able to prevent third persons from copying portions of his work; he is unable to prevent third persons from employing or describing the method discussed in such book.

A reporter wants to write a true-to-life story about a person who was kidnapped and buried alive for 83 hours. The reporter then extensively interviewed the survivor and spent several months coming up with a book documenting the plight of the survivor. A Hollywood studio company then made a movie out of the ordeal of the survivor. The reporter is saying that even though the movie was not based on the book, the research he has spent documenting the event was copyrightable. Is the contention of the reporter correct? A. Yes, considering that the research material used served as the foundation for the subsequent book of the reporter about the survivor. B. Yes, considering that the reporter has exerted substantial time and effort in his research, it is copyrightable. C. No, facts and research involved in obtaining facts should not be distinguished, and are not copyrightable. D. No. the subject matter is not copyrightable

C. No, facts and research involved in obtaining facts should not be distinguished, and are not copyrightable.

Is a work with a merger of aesthetic and functional features copyrightable? A. No, copyright law contemplates only original intellectual creations in the literary and artistic domain and is the proper subject of a patent. B. Yes, on all cases. C. It depends, if the design elements reflect a merger of aesthetic and functional consideration cannot be separated from utilitarian features, it is not copyrightable. D. No, on all cases

C. It depends, if the design elements reflect a merger of aesthetic and functional consideration cannot be separated from utilitarian features, it is not copyrightable.

The following are functions of banks except: a. Deposit function b. Loan function c. Make collections and payments d. Outsourcing of functions

d. Outsourcing of functions

It is commonly known as an account with fixed term. a. Savings account b. Time deposit c. Peso deposit d. Dollars account

b. Time deposit

Bank accounts maybe garnished by the creditors of the depositor. Which of the following deposits are exempt from garnishment? a. Foreign Currency deposits and those exempt by rules of Civil Procedure like provision for the family for four months. b. Deposit that have become dormant for a period of ten (10) years. c. Money or security or other evidence of indebtedness of any kind and interests thereon with banks, buildings and loan associations. d. Loans and other credit accommodations with maturities of more than five (5) years

a. Foreign Currency deposits and those exempt by rules of Civil Procedure like provision for the family for four months

An Act that vests the Bangko Central ng Pilipinas with the sole power and authority to issue currency within the territory of the Philippines a. Act No. 3936 -Private Development Banks b. R.A. 9302- Thrift Banks Act c. The New Central Bank Act d. R.A. 6848- Islamic Investment Bank of the Philippines

c. The New Central Bank Act

When may the Anti- Money Laundering Council (AMLC) perform an inquiry into deposits of a person? a. For purposes of determining his liabilities. b. To determine his assets with proper court order. c. Upon order of the court when there is probable cause that the deposits are related to crime of unlawful activities defined in R.A. 9194 d. When there is written consent of the depositor.

c. Upon order of the court when there is probable cause that the deposits are related to crime of unlawful activities defined in R.A. 9194

The total amount of loans, credit accommodations and guarantees that may be extended by a bank to any person, partnership, association, corporation, or other entity is known as CEILING. What is the percentage required of the net worth of such bank? a. 20% b. 30% c. 25% d. 35%

c. 25%

The BSP upon approval of at least five (5) members of the Monetary Board, may also grant this kind of loan or advances in the amount not exceeding 50% of its total deposits and deposits substitutes is known as: a. Loans without collateral b. Emergency loans c. Salary loans d. Banking loans

b. Emergency loans

The powers that may be conferred to the conservator are such powers as may be necessary in Conservatorship except: a. To take charge of the assets, liabilities, and the management b. To reorganize the management of the subject bank c. To collect all monies and debts due and exercise all powers necessary to restore its viability d. All of the above

d. All of the above

Any activity resulting from a trustor- trustee relationship involving the appointment of a trustee by a trustor for the administration, holding, management of funds for the use or benefit or advantage of the trustor or of others called beneficiaries a. Partnership Business b. Trust Business c. Corporation Business d. Trusteeship Business

b. Trust Business

Entities engaged in the lending of funds obtained in the form of deposits from the public. a. Quasi Banks b. Banks c. Pawnshop d. Commercial Banks

b. Banks

Ramon was asked to enumerate the classification of Banks in the Philippines. Upon answering he enumerated that Universal Bank, Commercial bank, Cooperative Bank Islamic Bank, Thrift and Rural Banks are the different classifications of Banks. After Ramon recited the professor called Ann and asked her the same question. Ann reply and said that bank are classified as the Central Bank, Metro Bank, Banco de Oro , Bank of the Philippine Island and Banco Filipino. If you are called to recite too, will you support Ramon’s answer?: a. No. Ramon’s answer is incorrect as Ann correctly enumerated the classifications of Bank in the Philippines b. Yes. Ramon correctly enumerated the classifications of Bank in the Philippines c. No Ramon and Ann is incorrect d. No. Ann correctly enumerated the classifications of Bank in the Philippines

b. Yes. Ramon correctly enumerated the classifications of Bank in the Philippines

Which of the following statement is not true about the nature of Banking business? a. Banking business is fiduciary in nature and requires high standard of integrity and performance b. Bank must exercise utmost diligence or the highest degree of care in the handling of deposits c. Banking business is fiduciary in nature and require extraordinary diligence d. Bank must exercise that degree of care like that of a good father of the family in the handling of deposits e. Both A and B are correct while C and D are incorrect

e. Both A and B are correct while C and D are incorrect

All foreign currency deposits are considered of an absolutely confidential in nature and shall exempt from attachment, garnishment or any other order or process of any court, legislative body, government agency or any administrative body whosoever. The following are the exemption to the secrecy of foreign currency deposit except: a. Upon the written permission of the depositor b. Upon order of competent court in cases of violation of AMLA when it established that there probable cause that the deposits or investments involved are in any way related to a money laundering offense c. The BSP and PDIC to the Corporation and/or Bangko Sentral may inquire into or examine deposit accounts pursuant to explanation d. The PDIC with prior approval of the Monetary Board

d. The PDIC with prior approval of the Monetary Board

All of the following are exceptions to the Bank Secrecy Law except? a. Upon order of the competent court in cases involving Graft and Corrupt Practices Act b. Examination by an independent auditor hired by the bank c. The BSP and PDIC to the Corporation and/or Bangko Sentral may inquire into or examine deposit accounts pursuant to explanation d. In- camera inspection by the Ombudsman

c. The BSP and PDIC to the Corporation and/or Bangko Sentral may inquire into or examine deposit accounts pursuant to explanation

The following are the grounds when the Monetary Board may close a bank or quasi-bank except? a. If unable to pay its liabilities (cash flow test) b. Has insufficient realizable assets to meet its liabilities (balance sheet test) c. If cannot continue without involving probable losses to its depositors or creditors. d. It persistently conducts business in a sound and safe manner

d. It persistently conducts business in a sound and safe manner

As part of the safeguards against imprudent banking, the General Banking Law imposes limits or restrictions on loans and credit accommodations which may be extended by banks. Which of the following are not considered limits and restriction on loans and credit accommodation? a. SBL Rules- those promulgated by the Bangko Sentral ng Pilipinas upon authority if Section 35 of the General Banking Law of 2000 b. DOSRI Rules- promulgated by BSP, upon authority of section 5 of the General Banking law c. Anti-Money Laundering Law d. No commercial bank shall make any loan or discount on the security of shares of its on capital stocks

d. No commercial bank shall make any loan or discount on the security of shares of its on capital stocks

These statements were presented to you for evaluation: I. The conservator is appointed to take charge of the assets, liabilities and the management of a bank or a quasi-bank in a state of continuing liability, or unwillingness to maintain a condition of liquidity deemed adequate to protect the interest of depositors and creditors II. The receiver is appointed to manage a bank or quasi-bank that is unable to pay its liabilities in the ordinary course of business, or has insufficient realizable assets to meet its liabilities, or cannot continue business without probable losses In your evaluation of the said statements: a. Statement 1 is correct , statement 2 is incorrect b. Statement 1 is incorrect, statement 2 is correct c. Both Statement are correct d. None of the statements is correct

c. Both Statement are correct

Ritchie love to shop and she has a habit of paying only in cash. In one of her shopping sprees in SM North Edsa, she got the shock of he life when for the first time, a store cashier refuse to accept her coins in payment for a purchase worth not more than one hundred pesos. Ritchie was paying 70 pesos in 25-centavo coins and twenty five pesos in 10-centavo coin. The salesgirl told her that her coins where not legal tender. Do you agree? a. Yes, Coins shall be legal tender in amounts not exceeding P 75.00 for denominations of 25 centavos and above and 25.00 for denominations of 10 centavos or less b. No. Coins shall be legal tender in amounts not exceeding P 100.00 for denominations of 25 centavos and above and 25.00 for denominations of 10 centavos or less c. Yes. All notes and coins shall be legal tender for all debts , public and private, in amounts not exceeding 100 for denominations of 1, 5, 10 and 25 sentimo coins d. Yes. All notes and coins issued by the Bangko Sentral shall be fully guaranteed as legal tender in the Philippines unless otherwise fixed by the Monetary Board, that coins shall be legal tender in amounts not exceeding Fifty pesos (P50.00) for denominations of Twenty-five centavos and above, and in amounts not exceeding Twenty pesos (P20.00) for denominations of Ten centavos or less.

d. Yes. All notes and coins issued by the Bangko Sentral shall be fully guaranteed as legal tender in the Philippines unless otherwise fixed by the Monetary Board, that coins shall be legal tender in amounts not exceeding Fifty pesos (P50.00) for denominations of Twenty-five centavos and above, and in amounts not exceeding Twenty pesos (P20.00) for denominations of Ten centavos or less.

Which is not true about the Bangko Sentral ng Pilipinas? a. The Bangko Sentral shall provide policy directions in the areas of money, banking and credit b. The Bangko Sentral is hereby authorized to adopt, alter, and use corporate seal which shall be judicially noticed: to enter into contracts ; to lease or own real and personal property c. BSP may compromise, condone or release, in whole or in part , any claim of or settled liability to the Bangko Sentral regardless of the amount involved under such term and condition as may be prescribed by the Monetary Board to protect the interest of the Bangko Sentral d. The Bangko Sentral may acquire and hold assets and incur such liabilities in connections with its operations authorized by the provision of RA 7653.

a. The Bangko Sentral shall provide policy directions in the areas of money, banking and credit

Mr. Dela Cruz, a second year accountancy student of a University in Manila, photocopied some pages of the Financial Accounting book authored by C. Valix, CPA. Mr. Ferrer, his professor in Financial Accounting, saw the photocopies during one of their classes. He scolded Mr. Dela Cruz for not buying the original book and told him that he violated the copyright law and maybe penalized. Is Mr. Ferrer correct? a. Yes, because the book was photocopied without the consent of the author and used publicly in a classroom. b. No, because the private reproduction of a published work in a single copy, where the reproduction is made by a natural person exclusively for research and private study, shall be permitted, without the authorization of the owner of copyright in the work c. No, because Mr. Dela Cruz reproduced a single copy only, exclusively for his private study and he did not gain any profit for photocopying some of the pages of the book. d. No, because he did not reproduced the whole book but only some of its pages, it can be permitted even without the consent of the owner of the copyright

b. No, because the private reproduction of a published work in a single copy, where the reproduction is made by a natural person exclusively for research and private study, shall be permitted, without the authorization of the owner of copyright in the work.

Kris Aquino commissioned Mr. Magaling to write a biography of her late father, Ninoy Aquino, for a fee. Upon completion of the work, Kris paid Mr. Magaling the agreed price. The biography was copyrighted. Kris, however, changed her mind again upon reading the book and decided not to have it published. Can Kris Aquino sell the property without the consent of Mr. Magaling? a. Yes, Kris Aquino can sell the copyrighted biography of her father without need of securing the consent of Mr. Magaling, the writer of said biography. b. Mr. Magaling entered into a contract with Kris Aquino and having compensated, he had parted with all his rights to the said book, in effect making Kris his assignee. c. The assignee’s rights include the right to sell the work without the consent of the writer, Mr. Magaling. d. All of the above

d. All of the above

Atty. Ana Maganda wrote a legal opinion for a client on the differences of a probationary, regular, casual and seasonal employee. She quoted without permission Atty. Aliling’s comment appearing in his book “Annotations on the Labor Code”, but she indicated the source of the quotation, the book and the author’s name. Atty Aliling is a labor law expert. Can Atty. Aliling hold Atty. Ana Maganda liable for infringement of copyright for quoting a portion of his book without his permission? a. Yes, because Atty. Ana Maganda copied somebody else’s work without the original author’s consent. b. No, because the Intellectual Property Code provides that a quotation from a copyrighted work can be used for judicial proceedings or for giving professorial advice by legal practitioner, provided the source are identified. c. Yes, because Atty. Ana Maganda used the work of another for her own gain. d. No, because everybody can quote somebody as long as the source and the name of the author of the quotation are identified.

b. No, because the Intellectual Property Code provides that a quotation from a copyrighted work can be used for judicial proceedings or for giving professorial advice by legal practitioner, provided the source are identified.

Read the following statements and determine which of the choices are correct: Statement 1: Infringement is the use by others without the registrant’s consent of a reproduction or colorable imitation of his trademark, tradename or service mark with the purpose of causing to mislead or misleading the public that those goods or services are those of the registrant. Statement 2: The definition of infringement implies that only registered trademarks, trade names and service marks are protected against infringement or unauthorized use by another or others a.Both statements are true b.Statement 1 is true while Statement 2 is false c. Only Statement 1 is true d.Only Statement 2 is true

a.Both statements are true

To establish trademark infringement, the following elements must be shown: (1) the validity of the plaintiff’s mark; (2) the plaintiff’s ownership of the mark; and (3) the use of the mark or its colorable imitation by the alleged infringer results in “likelihood of confusion” Of these, the element of ______________ is the gravamen of trademark infringement. a. Element no. 1 b. Element No. 2 c. Element No. 3 d. All of the above

c. Element No. 3

Unilevel Corporation asked your legal advice regarding their plan to use a trademark with the words “SWEET CANDY” However, there is an existing and registered trademark using the words “TWEET CANDY” Which of the following advices are correct a. The firm must abandon the plan because another company uses the trademark Tweet Candy and there is a danger of a suit for infringement. The words Sweet and Tweet is almost similar in sound and they can confuse or mislead the public. b. They can use the SWEET CANDY as long as there will be a very different packaging and flavors so as not to mislead the public. c. Unilevel is a well-known company and their products are patronized country-wide, they can use the trademark SWEET CANDY because TWEET CANDY is owned by a small-time company whose market is within Luzon only. d. None of the above

a. The firm must abandon the plan because another company uses the trademark Tweet Candy and there is a danger of a suit for infringement. The words Sweet and Tweet is almost similar in sound and they can confuse or mislead the public.

Which of the following works are protected and can be copyrighted? a. A biography containing your life, love and success. b. Your musical compositions with or without words. c. News of the day and other facts having the character of mere press information. d. A and B only

d. A and B only

The Sogod Hotel chain reproduces DVD’s, distributes the copies thereof to its hotels and makes them available to hotel guests for viewing in the hotel guest rooms and charges a separate fee for the use of the DVD players. Is Sogod Hotel liable for infringement? a. No, the DVD viewing is done privately in the hotel guest rooms. b. Yes, because the reproduction of the DVD’s violate the copyright or economic rights of the owner of the film. The hotel charge fees for the use of DVD player as well as there are room charges, they earn gain from the use of the DVD because it entices the guests to check-in in their hotel. c. No, the DVD viewing is part of the hotel services and it is the use of the DVD players that is charged and not the cost of the DVD. d. None of the above

b. Yes, because the reproduction of the DVD’s violate the copyright or economic rights of the owner of the film. The hotel charge fees for the use of DVD player as well as there are room charges, they earn gain from the use of the DVD because it entices the guests to check-in in their hotel.

Narciso Planas invented a gas-saving device, manufactured and sold it to the market without securing a patent. San Miguel Co., a rich and well-known company, bought one gadget, dismantled the device and studied it. In due time, the company is manufacturing a gas-saving device similar to the invention of Narciso Planas. Before offering it for sale, the company secured a patent. Below are the actions and defenses available for Narciso Planas. Which of the following statements are correct? I. Narciso Planas should first bring an action for the cancellation of the patent illegally secured by San Miguel Company and on the said proceedings, he must prove that he invented the device. II. Narciso Planas, being the inventor of the gadget, is the owner of an intellectual creation and is entitled to legal protection of said property right from the unauthorized use of the same by another person or entity. III. While the cancellation proceedings are pending, Narciso Planas may ask the court for preliminary injunction to prevent San Miguel from manufacturing more gadgets. IV. San Miguel Co. has a better right over the invention because they secured a patent before selling the device. a. Statements I and II are correct. b. Statements I and III are correct c. Statement IV is correct d. Statements I, II and III are correct

d. Statements I, II and III are correct

118. The infringer is liable to the following: I. An injunction for such infringement II. Pay actual, moral and exemplary damages III. Deliver for impounding of the articles alleged to infringe a copyright IV. Deliver for destruction all copies, devices and other means used for making the infringing copies Which of the statements above are TRUE: a. Statement 1 b. Statement 2 c. Statement 3 d. Statement 4 e. All of the above

e. All of the above

A condition which, if imposed on an obligation will be disregarded and will therefore make the obligation immediately demandable.

If Juan will not rise from the dead

X and Y are solidary debtors of A, B and C, joint creditors to the amount of P30,000. How much can B collect from X.

B can collect P10,000 from X.

X obligated himself to pay Y the amount of P30,000 30 days after May 31, 2021 plus a penalty of P3,000 if he fails to pay the obligation on due date. After demand for payment by Y, X offered to pay on July 30, 2021. Y can demand from

P30,000 plus P3,00

On October 4, 2020, A was indebted to B for P50,000 for a 20-day period. A proposed to B that X will pay A’s debt, and that A will be free from all liabilities. B and X agreed to the proposal. On October 25, 2020, when B tries to collect from X, he finds that X is insolvent. At the time of delegation, X was insolvent but this was not known to A. The insolvency is not of public knowledge. So B sues A on the ground that it was A who made the proposal and that A really guaranteed X’s solvency. Decide.

A is not liable, because A does not know the insolvency of X at the time of delegation and neither was the insolvency of public knowledg

X entered into a contract with Y, whereby X sold his land orally to Y. The land has been delivered and the money has been paid. Is the oral sale of land valid

The contract is valid because the contract is already perfected and executed

This kind of defective contract refers to that contract which is validly agreed upon because all the essential elements exist, but Courts can nullify it when there is damage or prejudice to one of the parties or to a third person. Its enforcement would cause injustice by reason of some external facts

Rescissible contract

In order that fraud may make a contract voidable

: It should be serious and should not have been employed by both contracting parties.

A, a businessman, borrowed P500,000 from B, a friend. To pay the loan, A issued a postdated check to be presented for payment 30 days after the transaction. Two days before the maturity of the check, A called up B and told him no to deposit the check on the date stated on the face thereof, as A had not deposited in the drawee bank the amount needed to cover the check. Nevertheless, B deposited the check in question and the same was dishonored for insufficiency of funds. A failed to settle the amount with B in spite of the latter’s written demand received personally by. Is A guilty of violating the Bouncing Checks Law?

Yes. A is liable because the check was dishonored

Which of the following statements is correct?

A limited partner who takes active part in the management of the firm becomes liable as a general partner

A Partnership is not dissolved upon the death of a

Limited partner

One of the following is not an alternative remedy available to a seller of personal property on installment if buyer defaults.

To take possession of the property and forfeit the amount paid by buyer.

A sold to B 200 cavans of rice for P150 per cavan or for a total price of P30,000, delivery to be made at the place of business of B. B knew that A had several cases in court for breach of contract. If A delivers only 150 cavans of rice, what is the right of B

He may reject the goods so delivered

A borrowed money from B in the amount of P90,000 and issued on January 10, 2017 a check in the amount of P100,000 to the latter in consideration thereof. The check is dated February 10, 2017. On the date of the maturity of the check. There was sufficiency of funds to cover the said check. However, A requested B not to deposit the check. After two months, A requested B anew not to encash the check after three months considering that his fund in the bank is not enough to cover the said check. B agreed. After three months, A requested B for the third time to encash the check after four months for the same reason. B agreed. After four months, B presented the check with the drawee bank for encashment; however, the bank dishonored the check for the reason “Stale Dated.” B demanded from A to pay him the face value of the check, but the latter refused to do so. Can A be held liable for violation of BP 22?

No, the check was dishonored by the drawee bank for the reason “Stale Dated” and not

S1 - The maximum imprisonment for hacking is 6 years. | S2 – The penalty for Piracy is either P5M or 10

All are incorrect

S1 - The introduction of computer viruses is also categorized as hacking. S2 - The Department of Trade and Industry (DTI) is the lead implementing agency in E-Commerce Law

All are correct

S1 - An employer can ask its employees to submit declaration forms that provide personal data – for instance, whether they have traveled to or been in close contact with persons who have gone to regions affected by COVID-19, whether they are experiencing symptoms. S2 - If the collection of the information is for journalistic purpose and for public concern, there is a need for the consent of the data subject

All are correct

S1 - The Data Protection Office is headed by Data Protection Officer and two of its main functions are compliance with the Data Privacy Act of 2012 and its IRR and support academic units and administrative offices in maintaining privacy in their functions and projects. S2 - Republic Act No. 10973 or also known as the Data Privacy Act of 2012. It was signed into law by President Benigno Aquino III last August 15, 2012.

Only S2 is incorrect (10173)

The bank deposit secrecy law bars all inquiries into a bank deposit. A deposit may, however, be looked into

in cases of impeachment

The following are causes of nonconformity which will exempt manufacturers, distributors, authorized dealers or retailers from being held responsible for defective motor vehicles, except:

compliance by the consumer of the obligations stipulated under the warranty

Furukawa Electric Co., Ltd., a supplier of electrical boxes (i.e., fuse boxes, relay boxes, and junction blocks) used in motor vehicles, was among the pre- qualified suppliers of Honda Canada. When Honda called for supplier quotes, Furukawa coordinated with its Japan-based competitors regarding their price quotations or bids. These meetings resulted in an arrangement whereby Furukawa would earn the contract for the tender. Consequently, Furukuwa was awarded the contract to supply the automobile parts of the 2001 and 2006 models of the Honda Civic. From 2000 to 2005, the estimated sales amounted to CAD16.5 million. What violation was committed, if any

Bid Rigging

The SEC, after notice and hearing, may dissolve a corporation upon filing ofa verified petition for the dissolution, on grounds provided by law. Which of the following statement is not correct?

Any stockholder of a corporation may, by written petition to the SEC, compel the dissolution of the corporation whenever any acts of its directors, officers or those in control of the corporation is illegal, fraudulent or dishonest

Which of the following will cause the automatic dissolution of a corporation

Refusal to comply with or defiance of any lawful order of the SEC restraining commission of acts which would amount to grave violation of its franchise

S1 – Patentable inventions refer to any technical solution of a problem in any field of human activity which is new, involves an inventive step and is industrially applicable. S2 – Copyright is confined to literary and artistic works which are original intellectual creations in the literary or artistic domain that is protected from the moment it was registered. S3 – A trademark is any visible sign capable of distinguishing the goods of an enterprise and shall include a stamped or marked container of goods

S2 and S3 are false

Jurisdiction over IP cases for infringement of registered trademarks, unfair competition, false designation of origin and false description or representation is lodged in –

RTC

It is the act of taking advantage of a shortage of securities in the market by controlling demand side, and exploiting market congestion during such shortages in a way as to create artificial prices

Squeezing the float

A bought from the store some goods and paid with a check. The check however bounced. The payee called the drawee bank asking for the name of A. The drawee bank refused citing non-disclosure of bank deposits. Is the bank correct?

Yes, the peso deposit may not be examined upon order of the court since it is not the the subject of litigation

S1 – A person cannot be charged of both the offense of money launderingand the unlawful activity. S2 – Failure to report a covered transaction or suspicious transaction is one ofthe instances when money laundering is committed.

Only S2 is correct

X Bank was closed by the Monetary Board on account of insolvency. At the time it was closed, A has three accounts with X Bank and each account has an outstanding balance of P250,000 or a total amount of P750,000. How much can A recover from the PDIC

The amount recoverable is only P500,000 for all the three accounts

In order to give rise to the prima facie presumption of knowledge of insufficiency of funds or credit, the prosecution must show the following, except

The check was presented within ninety days from the date of the maturity of the check

S1 – For Plunder to be an Unlawful activity under AMLA, Plunder, it must be at least P75 Million. S2 – Violation of Section 19 (A)(3) of Republic Act No. 10697, otherwise known as “The Strategic Trade Management Act”, in relation to Proliferation of Weapons of Mass Destruction (WMD) and Proliferation financing are included as part of the Covered Transactions.

Both false

It refers to a provisional remedy aimed at preserving monetary instruments or properties in any way related to an unlawful activity or money laundering offense defined herein, during the pendency of civil forfeiture proceedings

Freeze Order

It refers to a bank that has no physical presence in the country in which it is incorporated and licensed, and which is unaffiliated with a regulated financial group that is subject to effective consolidated supervision

Shell bank

S1 - No court shall issue a temporary restraining order or a writ of injunction against any provisional asset preservation order or asset preservation order, except the Court of Appeals or the Supreme Court. S2 - No prior criminal charge, pendency of a case, or conviction for anunlawful activity or ML offense is necessary for the commencement or the resolution of a petition for freeze order

All are correct

A risk-based approach shall be undertaken depending on the type of customer, business relationship, or nature of the transaction or activity.

Customer Due Diligence

S1 - For applications or requests for license, clearance, permit, certification or authorization requiring the approval of the local Sangguniang Bayan, Sangguniang Panlungsod, Sangguniang Panlalawigan, 45 working days which can be extended for another 10 days. S2 - Business permits shall be valid for a period of one (1) yea

Only S2 is correct

S1 - If the closed bank is not rehabilitated or taken over by another bank, amount in excess of the P500,000 coverage can still be claimed upon the final liquidation of the remaining assets of the closed bank. S2 - Depositors with valid deposit accounts with balances of P100,000.00 and below are not required to file claims provided they have no obligations with the closed bank, or have not acted as co-makers of these obligations, or are not spouses of the borrowers

Only S2 is correct

S1 – Ratification extinguishes the action to annul a voidable contract. S2 – Unenforceable contracts cannot be assailed by third persons

Both statements are true

The following falls under the Statute of Fraud, except:

Donation of immovable property

S1 - BAC shall in "all stages of the procurement process" invite Observers to sit in the proceedings. S2 - Direct Contracting, otherwise known as Selective Procurement is a method of Procurement that does not require elaborate Bidding Documents because the supplier is simply asked to submit a price quotation or a proforma invoice together with the conditions of sale, which offer may be accepted immediately or after some negotiatioS1 - BAC shall in "all stages of the procurement process" invite Observers to sit in the proceedings. S2 - Direct Contracting, otherwise known as Selective Procurement is a method of Procurement that does not require elaborate Bidding Documents because the supplier is simply asked to submit a price quotation or a proforma invoice together with the conditions of sale, which offer may be accepted immediately or after some negotiations

Only S2 is false

The Latin term for “one’s personal choice to become or accept a partner

Delectus personae

It is one brought by one or more of the stockholders or members in the name and on behalf of the corporation to redress wrongs committed against it or to protect or vindicate corporate rights, whenever the officials of the corporation refuse to sue, or are the ones to be sued or hold control of the corporation.

derivative suit

In a limited partnership, the creditor of a limited partner may charge the interest of the indebted limited partner, the interest so charged may be redeemed with:

separate property of any general

Contracts are effective and binding only between the parties, their assigns and their heirs. Three of the following enumerations are exceptions as provided by law. Which does not belong to the exception

Where one of the parties to the contract dies and thereafter a suit is filed on the basis of the contra

Consignation is a mode of payment which extinguishes an obligation. Which of the following is not a requisite for consignation

Prior notice has not been mad

The creditor shall have a right to indemnity for damages when, through the fault of the debtor, all the things which are alternatively the object of the obligation have been last or compliance of the obligation has become impossible. The indemnity shall be fixed on the basis of

The value of the last thing which disappeared plus damages

A & B are joint creditors mancomunados of X and Y, joint debtors, for a total sum of P9, 000. A owns 1/3 of the credit and B owns 2/3 of it. But X owes 2/5 of the debts and Y owes 3/5 of the debts. In this case.

A can only collect from X, P3, 600 and from Y, P5, 400

A, guardian of B, sold B’s house and lot worth P480, 000 for P240, 000

The contract can be rescinded because of inadequacy of price

X alleged that Y promised to give X one hectare of land. This is in consideration of X’s meritorious services to Y. Y pleads in defense that since the promise was not in writing, it is unenforceable under the Statue of Frauds. Decide

The Statute of Frauds is inapplicable here because the promise to give the land is not a sale of real property

Mr. AB owes Mr. CD P150, 000 due on August 31, 2016. Mr. AB executed a mortgage in favor of Mr. CD on MR. AB’s building was totally lost due to a strong typhoon. On August 12, 2016, Mr. CD demanded payment from Mr. AB. Is Mr. CD’s demand valid?

Yes. The debt becomes due at once because the guaranty was lost even through a fortuitous event unless the debtor can mortgage another property that is equally satisfactory

Henry, plant manager, required Jose who was his personal bodyguard to drive him to a sister company for an emergency meeting. Both of them missed lunch because the newly-opened expressway they traveled had no stopovers. Can both of them claim compensation for the 1-hour meal period which they did not enjoy

No, neither can recover

In three of the following cases, advanced payment by the debtor is not recoverable. Which is the exception?

The obligation was not due and demandable but the debtor delivered that it was already due and demandable and he insisted to pay

A owes B P10,000. With consent of both, C pays B P5,000. Now B and C are the creditors of A to the amount of P5, 000 each. Suppose A has only P5, 000. Which is correct?

B should be preferred

The following are requisites of Pledge except

To bind a third person, it must be recorded in the office of the Register of Deeds

A and B are capitalist partners with C as industrial partner. A and B contributed P20,000 each to the capital of the partnership. A contractual liability of P50,000 was incurred by the partnership in favor of X. The assets of the partnership have been exhausted still leaving an unpaid liability of P12,000. What are the rights and the obligation of the partners, if a

A, B and C are liable to X, and C after giving his share may ask reimbursement from A and B, unless otherwise stipulated

Tito Pacienciso is an employee of a foundry shop in Malabon, Metro Manila. He is able to make ends meet with his salary of P4,000.00 a month. One day, he asked his employer to stop deducting from his salary his SSS monthly contribution, reasoning out that he is waiving his social security coverage. If you were Tito’s employer, would you grant the request

No, SSS contribution is compulsory for both covered employer and covered employe

A, B, and C entered into an oral contract of partnership each contributing P1M each to the common fund plus other personal properties of the same amount and failed to register the partnership with the SEC. Is the partnership valid?

Yes, because public instrument is necessary only in case of | contributions of immovables.

A and B are co-owners of a parcel of land from which they derive profits in equal sharing being co-heirs in inheritance. Is there a partnership?

There is no partnership because co-ownership by itself does not establish a partnership despite the sharing of p

A contributed P1M, B contributed P1M, and C contributed services. They agreed to divide the profits and losses equally. In case of loss of P.3M, for how much, if any is C is liable

Nothing, because an industrial partner is exempt from losses

A subscribed to 1,000 shares of stock of X Corporation and paid 25% of the said subscription. Can he vote all his subscribed shares

Yes, because shares although unpaid but not delinquent can be voted.

A granted B the exclusive right to sell his brand of Maong pants with the price payable in two months from delivery and promising B a 20% commission on all sales. After delivery of the merchandise to B but before he could sell them, B’s store was burned without his fault, together with all of the pants. Must B pay the pants?

B must pay A the price agreed upon because there was sale and he became the owner thereof after delivery

In 2016, A bound himself to sell to B his house and lot which was being rented by another person, if B passes the CPA examination in 2018. Luckily for B, he passed the said examination. However, A sold the said property to C in 2017 after the agreement was entered into by A and and B. Was the sale valid?

It was valid because A was still the owner of the house and lot at the time of the sale but with resolutory condition.

In three of the following corporate proposals, a dissenting stockholder has the right to surrender his share of stock to the corporation and demand for the payment of their fair market value. Which is the except

Entering into management contract with another corporation

Which of the following is considered a prima facie evidence of being a partner in a partnership

When a person receives a share in the profits

A profit or loss must be distributed based on capital contribution and not based on agreement between the partners under the following, except:

If the designation of the profit and loss was intrusted to third person by agreement between the partner

The following right can be exercised by partner assignee of interest?

To share in the profit in accordance with his contract to which the assigning partner would otherwise be entitled

Generally, a corporation’s article of incorporation must include all of the following, except the

Quorum requirements

The Corporation Code sanctions a contract between two or more corporations which have interlocking directors, provided there is no fraud that attends to it and it is fair and reasonable under the circumstances. The interest of an interlocking director in one corporation may be either substantial or nominal. It is nominal if his interest

exceeds 20% of the outstanding capital stock

A subscribed to 100 shares of X corporation, paying 25% thereof. Despite the demand by A for the issuance of stock certificate, the corporation refuses to issue one corresponding to the 25% paid. Meanwhile, the corporation has become insolvent and A now refuses to pay his unpaid balance on his subscription. Is the refusal to issue a a stock certificate valid?

Valid, because stock certificate can only be issued after fullpayment of the subscription.

An Associate member in Cooperative is: S1 – One who has no right to vote nor be voted upon and shall be entitled only to such rights and privileges as the bylaws may provide. S2 - One who meets the minimum requirements of regular membership, continues to patronize the cooperative for three (3) years, and signifies his/her intention to remain a member shall be considered a regular member

S1 is correct, S2 is incorrect

The number of Board of Directors of a bank, including the independent directors are

5 – 15, two of whom are independent directors

S1 – The liability of the PDIC for insured deposits rests upon the existence ofdeposits with the insured bank and on the negotiability or non-negotiability of the certificates evidencing these deposits. S2 – The claim under PDIC must be filed within 2 years from actual takeover by the receiver.

S2 true

S1 - When one of the parties has brought an action to enforce the contract, he cannot subsequently ask for its reformation. S2 - The injured party may seek rescission even after he has chosen the fulfillment of the obligation if the latter should become impossible

True, true

X owns 99% of the capital stock of SSS Corporation. X also owns 99% of TTT Corporation. SSS Corporation obtained a loan from VW Bank. On due date, SSS Corporation defaulted. TTT Corporation is financially healthy. Which statement is most accurate

SSS Corporation and TTT Corporation, although both are owned by X, are two (2) distinct corporations with separate juridical personalities hence, the TTT Corporation cannot automatically be held liable for the loan of SSS Corporation

D mortgaged his car to C as security for a loan. Failing in the payment of the loan, C foreclosed the chattel mortgage and sold the car at public auction. In case of deficiency, Is D liable for it?

Yes, in the absence of contrary stipulation

S1 - The directors and officers of a cooperative shall not be entitled to any per diem when, in the preceding calendar year, the cooperative reported a net loss or had a dividend rate less than the official inflation rate for the same year. S2 - Any compensation other than per diems may be granted to directors by a 2/3 vote of the members with voting rights at a regular or special general assembly meeting specifically called for the purpose

S1 is correct, S2 is incorrect

P, the president of X Corporation, by virtue of a resolution of the stockholders empowering to enter into a contract with T Corporation for the purchase of certain machineries, actually did so. Such contract is:

Valid

The holders of non-voting shares shall nevertheless be entitled to vote on the following matter, except

Dividend declaration.

increased and new shares of stock are issued, the new issue must first be offered to the stockholders in proportion to their existing shareholdings before subscription are received from the general public. (2) Ultra vires acts are illegal and therefore void. (3) Certificate of incorporation is the document prepared by the persons establishing the corporation and filed with the SEC containing the matter required by the Corporation Code

All are false

An individual or a domestic corporation designated in a written power of attorney, by a foreign corporation authorized to transact business in the Philippines, on whom any summons and other legal processes may be served in all actions or other legal proceeding against such corporation is called-

Resident agent

(1) Corporators are incorporators. | (2) Incorporators are corporators

(1) is wrong but (2) is correct

Which of the following statement is correct

Lay corporation is one established for purposes other than religious.

A. It is illegal to issue watered stocks. However, stocks issues without anyconsideration at all is justified if such issues are bonus shares. B. A director is removed from office by a vote of the stockholders holding at least 2/3 of the outstanding capital stock. The vacancy occasioned by such removal can be filled by the vote of the majority of the remaining directors if still constituting a quorum

Both are incorrect

Charlie gave his diamond-encrusted watch worth Php 25,000.00 to his friend Danny as a birthday gift. Danny readily accepted the gift with profuse gratitude. One month later, they had a serious quarrel; hence, Charlie demanded the return of the watch from Danny. Danny refused to return the watch. What is the nature of this donation

Void, because the value of the thing donated exceeded Php | 5,000.00 and the donation and acceptance were not in writing

SUJU Corporation, through its Board of Directors and with the unanimous approval of the stockholders declared to grant stock dividends to its stockholders for the year 2008 amounting to 79 Billion Pesos. After examining the books and other records of the corporation, Sungmin Lee, Vice President for Finance, discovered that the authorized capital stock of the Corporation is almost depleted, that is – almost all were already issued and the remaining cannot accommodate the needed stocks for stock dividend distribution. The Corporation though was liquid in cash and has retained earnings amounting to 365 Billion Pesos. How should the Board of Directors of SUJU Corporation best act on it?

b. Increase the authorized capital stock and amend the Articles of Incorporation of SUJU Corporation to cater to the needed stocks for stock dividend distribution.

The following instances are considered as “indicators” that a foreign corporation is “transacting business” in the Philippines, even without securing a license, except

Subscribing shares of stock from a domestic corporation

Which among the following is not a necessary result or consequence when a foreign corporation does not secure a license and/or registers?

the foreign corporation can avail the aid of the Philippine courts and sue

Unless the by-laws provide otherwise, written notice of regular meetings shall be sent to all stock holders of record

At least twenty-one days prior to the meeting

What vote is needed to consider every decision to be a valid corporate act

a majority of the directors present at the meeting at which there is a quorum

A condominium buyer is entitled to the issuance of the Condominium Certificate of Title as a matter of right.

Yes, from the time he fully paid the purchase price

The borrower in a contract of loan or mutuum must pay interest to the lender

if there is an agreement in writing to that effect

Which of the following is not a common requisite to pledge and mortgage?

Must be placed in the possession of the creditor

``` Servino owns a piece of land and sells it to Balingit with a right of repurchase within four (4) years from the date of sal.e If Balingit sells the property to Baduria, which of the following is false? ```

The sale is void bec. it is a conditional sale

S1 – The BOD of a Cooperative shall hold office for Three (3) years and shall hold office until their successors are duly elected an qualified, or until duly removed for caused. S2 – The members of the board of directors shall hold any other position directly involved in the day to day operation and management of thecooperative.

: Both are incorrect

S1 - Loss of confidence shall not be a valid ground for removal unless evidenced by acts or omission causing loss of confidence in the honesty and integrity of such BOD in a Cooperative. S2 – When a director, officer or committee member attempts to acquire or acquires, in violation of his duty, any interest or equity adverse to the cooperative in respect to any matter which has been reposed in him in confidence, he shall, as a trustee for the cooperative, be liable for damages and shall be accountable for the profits which otherwise would have accrued to the cooperative

Both are incorrect

S1 - If a cooperative has not commenced business and its operation within two (2) years after the issuance of its certificate of registration or has not carried on its business for two (2) consecutive years, the Authority shall send a formal notice to the said cooperative to show cause as to its failure to operate. S2 – In case of voluntary dissolution where no creditors are affected in a cooperative, Resolution by the affirmative vote of at least 2/3 of all the members with voting rights, present and constituting a quorum at a meeting called for the purpose.

S1 is correct, S2 is incorrect

A cooperative may be dissolved by order of a competent court after due hearing on the grounds of, except

In case of death or insanity of a member in a primary cooperative

A cooperative may be organized and registered for any or all of the following purposes, except

To divide the profits and losses among themselves

S1 - Transparency allows public involvement of qualified and eligible Civil Society Organizations (NGOs, PAs, academic Institutions and religious institutions) to observe and monitor the procurement process until contract implementation. S2 - Primary beneficiaries shall have the priority claim to death benefits over secondary beneficiaries. Whenever there are primary beneficiaries, no deathbenefits shall be paid to secondary beneficiaries

S1 is incorrect, S2 is correct

The following are instances when the certificate in a limited partnership may be amended, except:

all the limited partners cease to be such

S1 - A worker below 18 should be directly under the sole responsibility of parents or guardians; work does not interfere with the child’s schooling/normal development; with work permit from DOLE. S2 - Competitive Bidding refers to a method of procurement which is open to participation by any interested party

S1 is incorrect S2 is correct

X subscribed 10,000 shares in the capital stocks of AAA Corporation. He paid 50% of the 10,000 shares. X asked the Corporate Secretary to issue him the corresponding stock certificate representing the 50% of what he already paid. The Corporate Secretary of the corporation refused. Was the Corporate Secretary correct

The Corporate Secretary is correct because the Revised Corporation Code provides that no certificate of stock shall be issued to a subscriber until the shares as subscribed have been fully paid

A private corporation was created by a special law. Later, the law creating it was declared invalid. May such corporation claim to be a de facto corporation?

No, where a private corporation is created under a special law, there is no attempt to incorporate a valid corporation

S1 - RA 7934 aims to protect consumers against hazards to health and safety, protect consumers against deceptive, unfair and unconscionable sales acts and practices, provide information and education to facilitate sound choice and the proper exercise of rights by the consumers, provide adequate rights and means of redress. S2 - Premium pay is the amount given in case a worker does not work on his rest day.

1 is correct, S2 is incorrect

S1 and S2 are true, S3 is false

The period to appeal the denial of the application for registration of a Cooperative from CDA to the Office of the President i

90 days

The Board of Directors of XYZ Corp. unanimously passed a Board Resolution approving the taking of steps that in reality amounted to willful tax evasion. On discovering this, the government filed tax evasion charges against all the company’s members of the board of directors. The directors invoked the defense that they have no personal liability, being mere directors of a fictional being. Are they correct

No, since the law makes directors of the corporation solidarily liable for gross negligence and bad faith in the discharge of their duties

the following contracts can be ratified, except:

Unauthorized

All of the choices.

I do that you may give

Facio ut des

Stikki Cement Company was organized primarily for cement manufacturing. Anticipating substantial profits, its President proposed that Stikki invest in a) a power plant project, b) a concrete road project, and c) quarry operations for limestone in the manufacture of cement. What corporate approval or vote is needed for quarry operations for limestones in the manufacture of the cement

Majority of the BOD

Alternative dispute resolutions (ADR) are recognized both in the Revised Corporation Code and the Cooperative Law. This ADR is a process wherein the parties meet with a mutually selected impartial and neutral person who assists them in the negotiation of their differences

Mediation

S1 – The bond of the single stockholder if he is likewise the treasurer is renewed every 3 years. S2 – The vote to divide the Cooperative is ¾ of the members. S3 – The limited partner may rightfully demand the return of his contribution after he has given a one (1) month notice in writing to all members if no time is specified in the certificate

S1 and S3 are false, S2 is true

The One Person Corporation is required to submit the following documents, except:

Compensation of director

M and N were very good friends. N borrowed P10,000 from M. Because of their close relationship, the promissory note executed by N provided that he would pay the loan “whenever his means permit.” Subsequently, M and N quarreled. M now seeks to collect the loan because he is in dire need of money. What kind of obligation is present

Period

S1 - Alternative methods of procurement is allowed in highly exceptional cases. S2 - As the owner of a business, the employer enjoys what are commonly known as management prerogatives. Among these are the right to select the persons to be hired and to discharge them for a just and valid cause; to promulgate and enforce reasonable employment rules and regulations’ to create, merge, divide, classify, and abolish departments or positions in the company’ to sell or close the business. The exercise of those rights however must always be in good faith

Both are correct

The Bangko Sentral ng Pilipinas

n case of a pre-negotiated rehabilitation plan in Section 76 of FRIA, it should be approved by

Creditors holding at least 2/3 of the total liabilities of the debtor including secured creditors holding more than 50% of the total secured claim and unsecured creditors holding more than 50% of unsecured claim

The following are prohibited transactions in a limited partnership, e

granting loans to the partnership

In distinguishing Earnest Money from Option Money, Earnest Money is

Given only when there is a perfected contract of sale

The Corporation Code sanctions a contract between two or more corporations which have interlocking directors, provided there is no fraud that attends to it, and it is fair and reasonable under the circumstances. The interest of an interlocking director in one corporation may be either substantial or nominal. It is nominal if his interest:

does not exceed 20% of the outstanding capital stock

Offenses against the confidentiality, integrity, and availability of computer data and system, except:

Infringement

Under the Articles of Incorporation of Manila Industrial Corp, its principal place of business shall be in Pasig, MM. The principal corporate office is at the Ortigas Center, Pasig, MM while its factory processing leather products is in Manila. The corporation holds its annual stockholders‘ meeting at the Manila Hotel in Manila and its BOD meeting at a hotel in Makati MM. The bylaws are silent as to the place of meetings of the stockholders and directors. Where should the meeting of the stockholders be he

Within Metro Manila, Metro Manila is considered a city or | municipality

unless otherwise provided in the Articles of Incorporation or in the By-laws.

S1 – In Culpa Aquiliana, negligence is only incidental. S2 – In Culpa Contractual, ordinary diligence is available as a defense S3 – The Master and Servant Rule applies in Civil Negligence S4 – Proof beyond reasonable doubt is the evidence required in Culpa Criminal

Only two statements are false

The penalty for violation of BP 22 is –

Both imprisonment and fine

The BOD of a corporation declared due and payable all unpaid subscription to the capital stock. The lone dissenting director failed to pay on due date, i.e., 19 Sept 2021, his unpaid subscription. Other than the shares wherein he was unable to complete payment, he did not own any share in the corporation. On 23 Sept 2021, he was informed by the BOD that, unless due payment is meanwhile received, he: a) could no longer serve as a director of the corporation forthwith: b) would not be entitled to the cash and stock dividends which were declared and payable on 24 Sep 2021; and c) could not vote in the stockholders meeting scheduled to take place on 26 Sept 2021. Was the action of the BOD on each of the foregoing matters valid

No, no, no

The following are instances of acts of ownership in general partnership, except:

continue the partnership on the death, insanity or civil interdiction of a general

A bound himself to deliver to B a 65-inch 2022 model of TV set, and the 18 cubic feet of White Westinghouse refrigerator with motor no. WERT 385, which B saw in A’s store, and to repair B’s piano. A did not do any of these. S1 – A can be compelled to deliver the TV set. S2 – A can be compelled to deliver the refrigerator. S3 – A can be compelled to repair the piano

S1 and S2 are true, S3 is false

The following are the requisites of voluntary liquidation of the individual debtor, except:

Acts of insolvency need not be alleged and proved

The corporate term of a stock corporation is that which is stated in its Articles of Incorporation. It may be extended or shortened by an amendment of the Articles when approved by majority of its Board of Directors and:

ratified by at least 2/3 of the stockholders representing the outstanding capital stock.

High Earning Corporation filed a complaint against five of its officers for violation of Section 31 of the Revised Corporation Code. The corporation claimed that the said officers were guilty of advancing their personal interests to the prejudice of the corporation, and that they were grossly negligent in handling its affairs. Aside from documents and contracts, the corporation also submitted in evidence records of the officers‘ U.S. Dollar deposits in several banks overseas - Boston Bank, Bank of Switzerland, and Bank of New York. For their part, the officers filed a criminal complaint against the directors of High Earning Corporation for violation of Republic Act No. 6426, otherwise known as the Foreign Currency Deposit Act of the Philippines. The officers alleged that their bank deposits were illegally disclosed for want of a court order, and that such deposits were not even the subject of the case against them. Under the Bank Secrecy Law, can these foreign currency deposits be opened since they are subject matter of the litigation?

No, since the Bank Secrecy excludes FCDU accounts

45 working days

The full report of the personal data breach must be submitted

within five (5) days

X Corp., whose business purpose is to manufacture and sell vehicles, invested its funds in Y Corp., an investment firm, through a resolution of its Board of Directors. The investment grew tremendously on account of Y Corp.'s excellent business judgment. But a minority stockholder in X Corp. assails the investment as ultra vires. Is he right and, if so, what is the status of the investment?

Yes, it is an ultra vires act of the corporation itself but voidable only, subject to stockholders’ ratification.

Under the Revised Corporation Code, an Emergency Board may be created by a vote of _____________ to (purpose) _________ and it will be temporarily filled from the ___________ of the corporation

majority / prevent grave, substantial, and irreparable loss or damage to the corporation/officers

Which of the following corporate acts are valid, void, or voidable? i) XL Foods Corporation, which is engaged in the fast-food business, entered into a contract with its President Jose Cruz, whereby the latter would supply the corporation with its meat and poultry requirements. ii) The Board of Directors of XL Foods Corporation declared and paid cash dividends without approval of the stockholders. iii) XL Foods Corporation guaranteed the loan of its sister company XL Meat Products, Inc.

Voidable, Valid, void

XXX Bank Corporation and ZZZ Corporation were merged into XX ZZ Bank Corporation. So as not to create any unnecessary conflict, all the former directors of both banks wanted to be appointed /elected as members of the Board of Directors of the merged bank. Each bank used to have eleven (11) members of the board. The maximum number of directors of the merged bank is -

X is a minority stockholder of CCC Corporation. Y is a member of the Board of Directors of CCC Corporation and at the same time he is the President. X believes that Y is mismanaging CCC Corporation hence, as a stockholder and in behalf of the other stockholders, he wanted to sue Y. Which statement is most

Derivative suit is an exclusive remedy that X can institute.

Which phrase best completes the statement - The affidavit of good faith in a Deed of Chattel Mortgage is?

an oath where the parties swear that the mortgage is made for the purpose of securing the obligations specified and that the obligation is just and valid;

The provision aims at criminalizing the intentional hindering of the lawful use of computer systems including telecommunications facilities by using or influencing computer data.

System Interference

Which phrase best completes the statement - To bind third parties, a chattel mortgage of shares of stock

with the Register of Deeds where the debtor resides and the principal office of the corporation

If ABC Corporation will increase its authorized capital stock, the Corporation Code requires the approval of the SEC and -

the approval of the majority of the Board of Directors and approval of the shareholders holding 2/3 share of the outstanding capital stock.

A single-purpose cooperative may transform into a multi-purpose cooperative and may create subsidiaries only after at least:

2 years of operation

No additional compensation other than per diems shall be paid to a director of a cooperative during of existence of any cooperative

First year

In case of disagreement between the corporation and a withdrawing stockholder who exercises his appraisal right regarding the fair value of his shares, a three-member group shall by majority vote resolve the issue with finality. May the wife of the withdrawing stockholder be named to the three member group?

No, the wife of the withdrawing shareholder is not a disinterested person.

The following modes of extinguishment of obligations require two or more creditors, except:

Dation in Payment

Under the Intellectual Property Code, lectures, sermons, addresses or dissertations prepared for oral delivery, whether or not reduced in writing or other material forms, are regarded as –

original works

Where no creditors are affected the cooperative may be voluntarily dissolved by vote of the board of directors and by a resolution duly adopted by the affirmative vote of the members with voting rights, present and constituting a quorum at a meeting to be held upon call of the directors

Majority; 3/4

In double sale of real property, priority is given to -

The one to whom who had it registered in good fait

in the following instances, the third person becomes part of the contract, except:

Delivery of the subject matter of the contract

Large scale in the Data Privacy Act is committed and the maximum penalty in the scale of penalties respectively provided in the offenses shall be imposed when the personal information ___________________________ is harmed, affected or involved as the result of the above mentioned actions.

of at least one hundred (100) persons

The contract shall be presumed to be an equitable mortgage in the following instances, except:

When the vendor retains for himself a part of the purchase price

The stockholders of People Power Inc (PPI) approved two resolutions in a special stockholders‘ meeting: a) Resolution increasing the authorized capital stock of PPI; and b) Resolution authorizing the BOD to issue, for cash payment, the new shares from the proposed capital stock increase in favor of outside investors who are non-stockholders. The foregoing resolutions were approved by stockholders representing 99% of the total outstanding capital stock. The sole dissenter was Jimmy Morato who owned 1% of the stock. Are the resolutions binding on the corporation and its stockholders including Jimmy Morato, the dissenting stockholder?

No, While these resolutions were approved by the stockholders, the directors‘ approval, which is required by law in such case, does not exist.

Below are instances when legal compensation is

One of the debts arises from mutuum

Instances when benefit to the creditor need not be proved if it redounded or not to him, except:

If after payment, the debtor acquired the right to collect from the guarantor

Yes, because there is already a pending case and provided the subpoena must be specific as to which account.

No member shall transfer his shares or interest in the cooperative or any part thereof unless he had held such share capital contribution or interest for not less than:

One year

The number of board of directors in a stock corporation

Minimum of 2, maximum of 15

An elected officer of a cooperative may be removed by

BOD

X, who is the Executive Vice President of ABC Corporation, a listed company, can be held liable or guilty of insider

All of the choices

A and B sold 1,000 sacks of rice to X and Y. On X’s request, A and B delivered the 1,000 sacks of rice to him. X resold the rice without turning over any part of it or its price to Y. What kind of obligation is present?

Joint divisible obligation

The number of trustees in a non-stock corporation

Minimum of 5, may be more than 15

ABC Corp. increased its capital stocks from Php10 Million to Php15 Million and, in the process, issued 1,000 new shares divided into Common Shares "B" and Common Shares "C." T, a stockholder owning 500 shares, insists on buying the newly issued shares through a right of pre-emption. The company claims, however, that its By-laws deny T any right of pre-emption. Is the corporation correct?

No, since the By-Laws cannot deny a shareholder his right of pre- emption

The common property of a universal partnership shall be

All the properties which belong to each of the partners at the time of the constitution of the partnership as well as the profits which they may acquire therewith.

S1 – The period for non-use of corporate charter is 5 years from the date of filing the articles of incorporation. S2 – The period for non-use of a cooperative is 2 years from the issuance of the certificate of incorporation. S3 – No damages can be recovered for acts of infringement of a patent committed more than three (3) years before the institution of the action for infringement.

S2 and S3 are false, S1 is true

Upon the winding up of the cooperative affairs, any asset distributable to any creditor, shareholder or member who is unknown or cannot be found shall be given to the:

Federation or union to which the cooperative is affiliated with

Upon dissolution of a cooperative, what happens to the capital donated to said cooperative?

It is subject to escheat

Three of the following contracts are inexistent and void from the beginning. Which is the exception?

That where one of the parties is incapable of giving his consent to a contract

Only two statements are false

S1 – The period to extend the life of the corporation if fixed is 5 years before its expiration. S2 – The period to extend the life of a cooperative is 5 years prior to its expiration. S3 – The period to extend the patent is 6 months prior to its expiration.

S1 and S3 are false, S2 is true

A _______ grants property rights on an invention, allowing the holder to exclude others from making, selling, or using the invention

patent

Which of the following is the least defective contract?

Rescissible

S1 - Report must done within lemon law rights period i.e. ending twelve (12) months from the date of subsequent delivery after repair to the consumer, or up to twenty thousand (20,000) kilometers of operation after such delivery , whichever comes first. S2 - The 250% rate must be paid to the worker in case the worker works on a holiday and it his rest day.

Both are incorrect

X mortgaged her residential house and lot in favor of ABC Bank. X defaulted in her loan and so the bank foreclosed the real estate mortgage on the residential house. Y then bought the residential house and lot before the expiration of the redemption period. Can Y now take possession of the property?

No, because it is still covered by the redemption period and the purchaser is not yet entitled as a matter of right to take possession of the property.

The following are judicial grounds for the dissolution of partnership, except:

Insolvency of any partner

X can claim a total of Php500,000 for all the three (3) accounts.

Which of the following is an exception to the secrecy of bank deposits and other laws which are in Philippine Pesos, but not an exception to the secrecy of foreign currency deposits?

Upon inquiry in cases of impeachment

S1 - In case of projects involving mixed procurements, the nature of the supplier, shall be determined based on the primary purpose of the contract. S2 - The New SS Law likewise made it compulsory for Overseas Filipino Workers, sea-based or land-based, to be members of the SSS as provided for under Section 9-B of R.A. No. 11199

Both are correct

Under the Anti-Money Laundering Law, a covered institution is required to maintain a system of verifying the true identity of their clients as well as persons purporting to act on behalf of

such clients

Applications or requests submitted by applicants or requesting parties of a government office or agency which only require ministerial actions on the part of the public officer or employee, or that which present only inconsequential issues for the resolution by an officer or employee of said government.

Simple Transactions

S1 - Unless otherwise provided by the policy, an insurer is liable for a loss of which a peril insured against was the proximate cause, although a peril not contemplated by the contract may have been the remote cause of the loss. But the insurer is not liable for a loss of which the peril insured against was only a remote cause. S2 - A grievance procedure is mandatory provision in the CBA, otherwise it is not registrable. Until the parties include a grievance procedure, the Corporate registration is deferred.

S1 is correct, S2 is incorrec

Mr. AB offered in writing to sell his house and lot for P750,000.00 to Mr. CD on July 1, 2019. Mr. CD requested Mr. AB to give him 60 days within which to raise the P750,000.00. On August 15, 2019, Mr. AB informed Mr. CD that the price is raised and now at P1,000,000.00. Can Mr. CD compel Mr. AB to sell his house and lot at P750,000.00 which was offered in writing by Mr. AB?

No, because Mr. CD has not accepted the offer of Mr. AB.

X maintains a savings deposit in the amount of Php·1 Million with ABC Bank Corporation. X also has obtained a loan from ABC Bank Corporation in the amount of Php1 Million. In case of default

ABC Bank can set-off the loan from the savings account being maintained by X with ABC Bank

S1 – The period to notify the creation of the emergency board is within 5 days from the creation of the board. S2 – The period to report the election of the officers of the One Person Corporation is within 5 days from their appointment. S3 – The period to submit the certificate of stock for notation on the exercise of appraisal right is within 10 days after the demanding for payment.

S2 and S3 are true, S1 is false

the following entities are not allowed to be a One Person Corporation (OPC), except:

Estate

The following are required to file their claims under the PDIC, except:

have not maintained the account under the name of business entities

The following instances are subject to suspensive condition, except

Conventional redemption

1 - An Asset Preservation Order is enforceable anywhere in the Philippines. S2 - On the reporting of covered transactions, the law mandates that covered institutions shall report to the AMLC all covered transactions within five (5) working days from occurrence thereof. S3 - On record-keeping under AMLA, the law states that all records of all transactions of covered institutions shall be maintained and safely stored for five (5) years from the date of transactions.

All statements are true

AAA Corporation is a foreign corporation that wants to operate a representative office here in the Philippines. As required by the Corporation Code, there is a need to appoint a Resident Agent as a condition precedent to the issuance of a license to transact business in the Philippines. After two (2) years, AAA Corporation removed its Resident Agent and did not appoint anyone anymore. Which statement is the most accurate?

This can be a ground for revocation or suspension of its license to do business

A partnership which compromises all the partners may acquire by their work or industry during the existence of the partnership is

Universal partnership of profits

A and B sold 1,000 sacks of rice to X and Y. On X’s request, A and B delivered the 1,000 sacks of rice to him. X resold the rice without turning over any part of it or its price to Y. From whom will Y ask for delivery of his share?

From A and B

Ralph and Vi orally agreed to form a partnership. Each contributed cash and personal properties worth P10,000 to a common fund. But they did not register the partnership with the Securities and Exchange Commission (SEC)

The partnership is still valid.

A sold a parcel of land to B for P200,000. In the deed of sale, there is a stipulation that the purchase price shall be paid on a certain date and that in case of failure to pay on a certain date, then the contract shall be automatically rescinded. The period arrived and B failed to pay as stipulated in the contract.

The contract is not rescinded until there is notarial rescission.

Which of the following obligations of the vendor cannot be waived?

To transfer ownership to the buyer

A and B sold 1,000 sacks of rice to X and Y. On X’s request, A and B delivered the 1,000 sacks of rice to him. X resold the rice without turning over any part of it or its price to Y. How much if any, can Y demand from the person/s liable?

500 / 250

M and N were very good friends. N borrowed P10,000 from M. Because of their close relationship, the promissory note executed by N provided that he would pay the loan “whenever his means permit.” Subsequently, M and N quarreled. M now seeks to collect the loan because he is in dire need of money

No, he must first ask the court to fix the period

Which phrase best completes the statement - When a debt is secured by a real estate mortgage, upon default of the debtor?

the creditor can foreclose the mortgage and demand collection for any deficiency;