HOLY NAME UNIVERSITY

COLLEGE OF BUSINESS AND ACCOUNTANCY

FIRST SEMESTER S.Y. 2021-2022

FINAL EXAMINATION
THE LAW ON OBLIGATIONS AND CONTRACTS

December 10, 2021

INSTRUCTIONS

1. This questionnaire contains sixteen (16) pages including this page.

2. Select the correct answers for each of the following questions. Mark only one answer for
each item using the corresponding choices as indicated below. Please provide your answers
in a separate Word (.doc) file in the order given in the questionnaire.

MULTIPLE CHOICE (100 points)

Choose the best answer to the questions given and write only the letter of your choice.

1. It is the meeting of the minds between the parties on the subject matter and the cause which
are to constitute the contract.

a. Offer c. Acceptance
b. Consent d. None of the above.

2. All of the following are considered vices of consent, except:

a. Force c. Intimidation
b. Fraud d. All of the following are vices of consent

3. It is the false notion of a thing or a fact material to the contract.

a. Mistake c. Intimidation
b. Fraud d. Violence

4. As a general rule, this is the mistake contemplated by law to be considered as a vice of

consent:

a. Mistake of law
b. Mistake of obligation
c. Mistake of fact
d. None of the above

5. When one of the parties is unable to read or understand the language of a contract, and mistake
or fraud is alleged, who has the burden to prove that terms thereof was duly explained to him?

a. Obligor
b. Person who did not understand the terms of the contract
c. Person enforcing the contract
d. None of the above

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6. In order for violence to be considered as a vice of consent, there should be an exertion of
_______.

a. Fear
b. Intimidation
c. Threat
d. Physical Force.

7. This is a vice of consent wherein it overpowers the mind of a party as to destroy his free will
and make him express the will of another, rather than his own.

a. Violence
b. Intimidation
c. Threat
d. Undue Influence

8. These are factors to determine the degree of intimidation that is experienced by a party:

a. Age
b. Sex
c. Condition of the person
d. All of the above are factors in determining the degree of intimidation.

9. This is a type of fraud which is committed by one party before or at the time of the celebration
of the contract to secure the consent of the other.

a. Causal Fraud
b. Incidental Fraud
c. Contractual Fraud
d. None of the above.

10. Causal Fraud is committed through ________.

a. Insidious words
b. Machinations
c. Concealment
d. All of the choices are considered as a means to commit causal fraud.

11. An expression of opinion can signify fraud only if it is made by ________.

a. Expert
b. Obligor
c. Debtor
d. Lawyer

12. This is a type of fraud which renders the party who employs it to be liable for damages
because the fraud was not the principal inducement that led to the other to give his consent.

a. Causal Fraud
b. Incidental Fraud
c. Contractual Fraud
d. None of the above.

13. This is an act of deliberately deceiving others by feigning or pretending by agreement the
appearance of a contract which is either non-existent or concealed.

a. Simulation of a contract

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 b. Contractual Fraud
c. Causal Fraud
d. None of the above

14. This is a type of simulation when the contract does not really exist and the parties do not
intend to be bound at all.

a. Absolute Simulation
b. Relative Simulation
c. Simulation of Contracts
d. None of the above

15. This is a type of simulation wherein the contract entered into by the parties is different from
their true agreement, hence the parties shall be bound by their real agreement.

a. Absolute Simulation
b. Relative Simulation
c. Simulation of Contracts
d. None of the above
16. All of the following are the requisites for things to be considered as objects of a contract,
except:

a. The thing must be within the commerce of man

b. It must not be impossible
c. It must be in existence or capable o coming into existence.
d. All of the choices are requisites for things to be considered as an object of a contract.

17. All of the following are the requisites for services to be considered as objects of a contract,
except:

a. It must be within the commerce of man

b. It must not be impossible
c. It must be determinate or capable of being made determinate.
d. All of the following are requisites for services to be considered as objects of a contract.

18. This is a kind of impossibility wherein the thing or service in the very nature of things cannot
exist.

a. Legal Impossibility
b. Impossible Service
c. Physical Impossibility
d. None of the above

19. This is the essential or proximate purpose which the contracting parties have in view at the
time of entering into the contract.

a. Object
b. Cause
c. Consent
d. None of the above

20. This is a purely personal or private reason for a party to enter into a contract and is different
from the consideration or cause thereof.

a. Object
b. Motive
c. Cause

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 d. None of the above

21. It is defined as any damage caused by the fact that the price is unjust or inadequate.

a. Lesion
b. Gross Inadequacy
c. Damage
d. None of the above

22. In order to be considered as a written contract, all of its terms must be _____.

a. Clearly stated
b. Provided for in full
c. All must be in writing
d. None of the above

23. The following are kinds of defective contracts, except:

a. Rescissible Contracts
b. Voidable Contracts
c. Void Contracts
d. All of the choices are defective contracts

24. This is a type of contract wherein it has been validly agreed upon because all the essential
elements of a contract exist and therefore legally effective, but may be revoked in the interest of
equity.

a. Rescissible Contract
b. Unenforceable Contract
c. Void Contract
d. None of the above

25. This is a type of contract which possess all the essential requisites of a valid contract but one
of the parties is incapable of giving consent or consent is vitiated by mistake, violence,
intimidation, undue influence or fraud.

a. Voidable Contract
b. Void Contract
c. Rescissible Contract
d. None of the above

26. This means that one voluntarily adopts some defective or unauthorized act or contract which
without his subsequent approval or consent would not be binding upon him.

a. Rescission
b. Ratification
c. Revocation
d. None of the above

27. This is a remedy provided for by law for reason of public interest for the declaration of the
inefficacy of a contract based on a defect or vice of consent .

a. Revocation
b. Annulment
c. Reaffirmation
d. None of the above

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28. This is a type of ratification wherein it is being clearly manifested in words or in writing.

a. Express
b. Tacit
c. Onerous
d. None of the above

29. This is a type of ratification wherein it takes of different forms such as by silence or
acquiescence through acts showing adoption or approval of the contract or by acceptance and
retention of benefits.

a. Express
b. Tacit
c. Gratuitous
d. Onerous

30. These contracts are defective and cannot be sued upon in court by reason of some defects
provided by law until they are ratified (i.e. not in writing)

a. Rescissible
b. Voidable
c. Unenforceable
d. None of the above

31. This is a legal concept which was enacted not only to prevent fraud but also to guard against
the mistakes of honest men by requiring that certain agreements should be in writing.

a. Written Instrument Rule

b. Statute of Laws
c. Statute of Frauds
d. Written Agreements Rule

32. This is a type of contract which produce no effect at all because of certain defects.

a. Voidable Contract
b. Rescissible Contract
c. Defective Contract
d. Void Contract

33. This is a repercussion if the parties in a contract are in pari delicto:

a. The parties can ask each other to have their contracts enforced.
b. The law shall leave them in the situation in which they have found themselves in.
c. The guilty party will be arrested and put to jail.
d. None of the above.

34. This is an effect if one of the parties who is involved in an illegal contract repudiates before
the contract is accomplished or when there has yet been no damage that was inflicted to another
person.

a. He/she can recover the money or property that he/she has paid.
b. The law will leave them as it is for they are in pari delicto.
c. The contract will be declared as void.
d. None of the above.

35. This is a legal consequence whenever a previous illegal contract is reformed or novated.

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a. The subsequent contract is also void.
b. The illegal contract will be converted to a valid contract.
c. The subsequent contract will be converted to a inexistent contract.
d. None of the above.

For numbers 36

36. Ed owes Taylor P50,000.00 and promises to pay her next month. However, Ed failed to pay
the loan and since Taylor is very rich, she did not file for a collection case.

Now, thirty years have lapsed and Taylor is no longer young, but she is broke. Now, Ed while
thinking out loud remembered that he owes Taylor P50,000.00, he then proceeds to pay the said
amount. Now, if Ed would have a change of heart, can he still recover the money that he has
paid?

a. Yes, because collection cases for loans can only be filed within 10 years.
b. Yes, because the prescriptive period has already set in.
c. No, Ed can no longer recover the amount that he has voluntarily paid to Taylor.
d. None of the above.

37. Mr. S sold to Mr. B a brand new car and 100 kilos of marijuana. The brand new car was
priced at P2,000,000 while the 100 kilos of marijuana was priced at a discounted rate of P30,000.

Mr. C informed Mr. S and Mr. B that their contract cannot be enforced because why a prohibited
drug is included as an object of their contract. Is Mr. C correct?

a. Yes, Mr. C is correct.

b. Yes, Mr. C is correct because marijuana is a prohibited drug and selling such an item together
with a car would invalidated the contract.
c. No, Mr. C is wrong and should just keep his opinions to himself.
d. None of the above.

38. Christina wants to buy an item worth P1,000 at the store of Tony. Later on, Christina saw on
the packaging of the item that the SRP of the item is only P800.

Christina has a 1.0 grade in Obligations and Contracts, and thus went to the store of Tony and
demanded that Tony reimburse her for P200 since the SRP for the item is only P800. Is Christina
correct?

a. Yes, Christina is correct since the SRP is clearly lower than the price at which Tony sold the
item.
b. Yes, Christina is correct since under Article 1417 of the Civil Code, it is provided therein that
any person paying any amount in excess of the maximum price may recover such excess.
c. No, Christina is not correct based on Article 1417 of the Civil Code.
d. No, Christina is not correct because Tony is an innocent party to this whole transaction.

39. Paul sold illegal firearms to Andre, Andre was duly informed by Paul that the firearms did
not undergo the proper procurement process under the law.

Now, Paul failed to deliver one third of the illegal firearms, and Andre on the other hand has also
not paid his corresponding share in the sale of the illegal firearms.

What could be the possible legal effect of their transaction?

a. Paul can have their contract enforced since he has already delivered part of the illegal firearms.
b. Andre can have the contract annulled.

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c. There is no other legal recourse for them and they should be left in the situation that they have
found themselves in.
d. Paul and Andre can just have their contract written into a public instrument.

40. Cecilia and Ben orally agreed that Ben will buy the television set of Cecilia for P500 pesos.

Ben would now want to buy the television set of Cecilia but Cecilia is now refusing to do so. Can
Ben have their previous oral contract enforced?

a. No, Ben cannot do so under the Statue of Frauds.

b. Yes, since the oral contract is binding.
c. No, Ben cannot have it enforced because their contract is void.
d. None of the above.

41. In relation to #40, what if the price of the television set is P499 pesos, can Ben have the
contract enforced?

a. No, it is in violation of the statute of frauds.

b. No, because the agreement should have been in writing.
c. Yes, because the price is only P499 pesos.
d. None of the above.

42. Aling Vicky is renting out a room in her boarding house located in Janssen Heights. Elaine,
an HNU student would like to rent the said room.

Aling Vicky and Elaine agreed orally that Elaine would rent out the room for 3 years. After
doing so, Elaine went home to her hometown in order to prepare her things.

However, Aling Vicky rented out the room to another student. Now, Elaine would like to have
their previous agreement enforced. Can Elaine have their previous agreement enforced?

a. Yes, Elaine can have it enforced because they have orally agreed that she will be the one to
rent out the room.
b. No, Elaine cannot have the previous agreement enforced because it was not in writing.
c. Yes, Elaine can have it enforced under the rule “first come, first served”.
d. No, because Elaine did not really have an agreement with the real Aling Vicky.

43. In relation to #42, what if the period to rent out the room is just for 2 years, can Elaine have
the contract enforced?

a. No, Elaine cannot have it enforced.

b. Yes, Elaine can have it enforced.
c. No one among the parties can have it enforced.
d. None of the above.

44. Still in relation to #42, what if the period to lease out the room is just for 1 year, can Elaine
have their previous agreement enforced?

a. No, Elaine cannot have it enforced.

b. Yes, Elaine can have it enforced.
c. No one among the parties can have it enforced.
d. None of the above.

45. Roland was able to forced Rey to sell to him his parcel of land because he held Rey at
gunpoint.

Rey afterwards went to a lawyer so that he can file a case to have the contract annulled.

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However, after going to the office of the lawyer, Rey went to the bank and encashed the check
that was given to him by Roland. Now, can Rey have the contract of sale annulled?

a. Yes, Rey can have the contract annulled because he was being held at gunpoint when he
signed the contract and it was against his will.
b. No, Rey cannot have it annulled because he has expressly ratified the contract.
c. No, Rey cannot have it annulled because a tacit ratification was done.
d. None of the above.

46. Coleen sold a parcel of land to Cara because Cara fraudulently made Coleen sign the
contract, thus the consent of Coleen was vitiated.

The following month, Coleen sold the same parcel of land to Charlene. Coleen confided to
Charlene that her consent was vitiated when she signed the deed of sale so Charlene went to
court to have the previous contract annulled.

Cara opposed the sale saying that Coleen is a stranger to the contract of sale between her and
Coleen and therefore she has no personality to file a case to have the contract annulled. Is Cara
correct?

a. Yes, Cara is correct because strangers to a contract have no personality to file an action to
annul.
b. No, Cara is not correct since Charlene is an interested party having subsequently acquired the
parcel of land through a legitimate sale from Coleen.
c. No, Cara is not correct because she is not part of the subsequent contract.
d. None of the above.

47. Arnold sold his brand new car to Cardo in order to avoid the payment of his debt to Paul.
Cardo was duly informed by Arnold of his intention to avoid the payment of his debt to Paul.

After which, Cardo sold the same car to Pete who also knew of the history of the sale of the car
which is to avoid the payment of Arnold’s debt.

What could be the legal consequence if Paul managed to have the contract rescinded and the car
is destroyed, who will be liable for damages?

a. Cardo will be liable for damages since he is in bad faith.

b. Arnold is liable because he is in bad faith.
c. Cardo and Arnold are both liable because they are in bad faith.
d. None of the above

48. In relation to #47, what is Pete also sold it to Mary who is a buyer in good faith, meaning she
did not know about any of the previous transactions. Will Mary be liable to Paul?

a. No, Mary is not liable since she is in good faith.

b. No, Mary is not liable because she did not sign a contract.
c. Yes, Mary is still liable because the contract is tainted with illegalities, a subsequent buyer will
still be liable to the creditor, in this case, Paul.
d. None of the above.

49. Still in relation to #47, what if Cardo is in good faith, meaning he did not know of Arnold’s
ill intention to evade his liability to Paul. What could be the legal consequence of such a
circumstance?

a. The good faith or bad faith of the subsequent buyers is no longer important and none of them
could be held liable.

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b. The subsequent buyers in bad faith will be liable for damages.
c. The buyers in good faith will be exempted from payment of damages.
d. None of the above.

50. Ronaldo is the legal guardian of Messi. Ronaldo was duly authorized by the court being the
legal guardian of Messi to sell two parcels of land belonging to Messi for P500,000.00 each.

Ronaldo was able to sell the two parcels of land for only P500,000.00. Now, Messi came of age
and would like to have the contract of sale rescinded because he incurred a loss of P500,000.00.
What could be the possible result of Messi’s action in court?

a. The entire sale would be annulled because Ronaldo did not comply with the authority given to
him.
b. Ronaldo will be prosecuted for fraudulently selling the parcels of land in contravention of the
authority given to him.
c. The sale as to one of the parcels of land will be rescinded, but the sale as to the other parcel
will be valid.
d. None of the above.

51. Mary Ann sold his land to Mia for P1,000,000.00. The sale was validly conducted and
complied with all the requisites for contracts.

However, unbeknownst to Mary Ann, the purpose of Mary Ann in selling the land was to buy a
large amount of shabu to be sold to the public. Will the contract of sale between the parties be
annulled/rescinded?

a. No, the contract of sale cannot be annulled because the sale was validly conducted and all the
requisites were complied with.
b. No, the contract of sale will not be annulled because Mary Ann’s motive for entering into the
contract is not important.
c. Yes, the sale will be annulled/rescinded because the purpose of Mary Ann was to acquire
shabu, which is a prohibited drug and worse, she is planning to sell it to the public.
d. No one cares.

52. On a fine sunny afternoon, Ferdinand was being forced by George to sign a contract which
would in effect sell all of his shares in the company to him.

Ferdinand signed the contract, but later on tried to have the contract annulled based on the fact
that he was allegedly being forced by George to sign the contract. Will Ferdinand’s action
prosper?

a. No, there was no physical violence or force that was imposed on his person when he signed
the contract.
b. Yes, his consent was clearly vitiated when he signed the contract since he was forced to sign
it.
c. Yes, the action file an annulment case is still within the prescriptive period.
d. None of the above.

53. In relation to #52, what if George threatened Ferdinand that he would kill Ferdinand if he
will not sign the contract. In this situation, George is a sickly ten year old boy. Can Ferdinand
have the contract annulled based on intimidation?

a. Yes, his consent was clearly vitiated.

b. No, the situation presented will negate the presence of intimidation.

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c. Yes, George threatened Ferdinand that he will kill him if he will not sign, thus vitiating his
consent.
d. None of the above.

54. Maria was forced by Michael to sign a contract of sale regarding their house and lot.
Michael told Maria that he will kill John, Maria’s fiancée if Maria will not sign the contract. Can
Maria later on have the contract annulled if she would sign it?

a. Yes, Maria can have the contract annulled because her consent was vitiated through
intimidation
b. No, Maria cannot have the contract annulled.
c. Yes, Maria can have it annulled because she was just forced to sign the document.
d. None of the above.

55. In relation to #54, what if Michael threatened to kill Maria’s neighbor instead, can the
contract be annulled later on?

a. Yes, Maria can have the contract annulled because her consent was vitiated through
intimidation
b. No, Maria cannot have the contract annulled.
c. Yes, Maria can have it annulled because she was just forced to sign the document.
d. None of the above.

56. Mirana, without the authority of Davion owner of a car, sold the same car in the name of
Davion to Selemene. The contract between Selemene and Davion is:

a. Void, because of the absence of consent from the owner, Davion.

b. Valid, because all the essential requisites of a contract are present.
c. Unenforceable, because Mirana had no authority but he sold the car in the name of
Davion, the owner.
d. Rescissible, because the contract cause lesion to Selemene.

57. Which of the following contracts is void?

a. An oral sale of a parcel of land.

b. A sale of land by an agent in a public instrument where his authority from the principal is
oral.
c. A donation of a wrist watch worth P4,500.
d. A relatively simulated contract.

58. A orally offered to sell his two-hectares rice land to B for P10 million. The offer was orally
accepted. By agreement, the land was to be delivered (through execution of a notarized deed of
sale) and the price was to be paid exactly one month from their oral agreement. Which statement
is most accurate?

a. If A refuses to deliver the land on the agreed date despite payment by B, the latter may
not successfully sue A because the contract is oral.
b. If A refused to deliver the land, B may successfully sue for fulfilment of the obligation
even if he has not tendered payment of the purchase price.
c. The contract between the parties is rescissible.
d. The contract between the parties is subject to ratification by the parties.

59. Which of the following statements is wrong?

a. Creditors are protected in case of contracts intended to defraud them.

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 b. Contracts take effect only between the parties, their assigns and heirs, except in case
where the rights and obligations arising from the contract are not transmissible by their
nature or by stipulation or by provision of law.
c. If a contract should contain some stipulation in favour of a third person, he may demand
its fulfilment provided he communicated his acceptance to the obligor before its
revocation.
d. In contracts creating real rights, third persons who come into possession of the object of
the contract are not bound thereby.

60. The following are the characteristics of a voidable contract, except:

a. Effective until set aside

b. May be assailed/attacked only in an action for that purpose
c. Can be confirmed or ratified
d. Can be assailed only by either party.

61. The following are void contracts, except:

a. Pactum Commisorium
b. Pactum de non Alienando
c. Pactum Leonine
d. Pacto de Retro

62. If one of the parties to the contract is without juridical capacity, the contract is:

a. Voidable
b. Rescissible
c. Void
d. Unenforceable

63. When both parties to the contracts are minors, the contract is:

a. Voidable
b. Rescissible
c. Void
d. Unenforceable

64. When the consent of one parties was vitiated, the contract is:

a. Voidable
b. Rescissible
c. Void
d. Unenforceable

65. The following are requisites before a contract entered into in fraud of creditors may be
rescinded, except:

a. There must be credit existing prior to the celebration of the contract.

b. There must be fraud or at least, the intent to commit fraud to the prejudice of the creditor
seeking rescission.
c. The creditor cannot in any legal manner collect his credit.
d. The object of the contract must be legally in possession of a third person in good faith.

66. The following are rescissible contracts, except:

a. Entered into by a guardian whenever ward suffers damage more than ¼ of the value of
the property.

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 b. Agreed upon in representation of absentees, if absentee suffers lesion by more than ¼ the
value of the property.
c. Contracts where fraud is committed on the creditor.
d. Contracts entered into by minors.

67. The following are solemn contracts (contracts which must appear in writing), except:

a. Donations of real estate or of movables if the value exceeds P5,000.

b. Stipulations to pay interest in loans.
c. Sale of land through an agent.
d. Construction contract of a building.

68. The following are the ways by which innominate contracts are regulated, except:

a. By the stipulation of the parties.

b. By the general principles of quasi-contracts and delicts.
c. By the rules governing the most analogous nominate contracts.
d. By the customs of the place.

69. It is a rule which holds that the freedom of parties to contract includes the freedom to
stipulate, provided the stipulations are not contrary to law, morals, good customs, public order or
public policy.

a. Obligatory force of contracts

b. Mutuality of contracts
c. Autonomy of contracts
d. Relativity of contracts

70. It refers to the rule that a contract is binding not only between the parties but extends to the
heirs, successors in interest and assignees of the parties, provided that the contract involved
transmissible rights by their nature or by stipulation of law.

a. Obligatory force of contracts

b. Mutuality of contracts
c. Autonomy of contracts
d. Relativity of contracts

71. When the object of the contract is outside the commerce of man, the contract is:

a. Voidable
b. Rescissible
c. Void
d. Unenforceable

72. In order that fraud may make a contract voidable:

a. It should be serious and should not have been employed by both contracting parties.
b. It may be incidental but should have been employed by both parties
c. It should be serious and the parties must be in pari delicto
d. It may be incidental but both parties should not be in pari delicto

73. Charsi and Jamella who are both unemancipated minors entered into a contract. The contract
entered into by and between them is:

a. Voidable
b. Rescissible
c. Void

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 d. Unenforceable

74. Which of the following contracts cannot be ratified?

a. Those whose cause or object did not exist at the time of the transaction.
b. Unauthorized contracts.
c. Those where both parties are incapable of giving consent
d. Those that fail to comply with the Statute of Frauds

75. On July 15, 1986, Ellen entered into a contract with Derek. On February 10, 1987, Ellen
discovered that fraud was committed at the time she entered into the contract, a fraud that
vitiated his consent. The action for annulment shall be brought:

a. Within four years from February 10, 1987

b. Within three years from the time of discovery of fraud
c. Within four years from the time Ellen entered into the contract
d. On February 10, 1987

76. On September 1, 1987, Barbie entered into a contract with Diego whereby Barbie sells to
Diego 5,000 sacks of sugar to be delivered on the 15 th and to be paid in full on the 30th. There
was no agreement for rescission based on non-payment. Barbie did not deliver on the 15th but on
the 30th, he was willing and offering to deliver but Diego did not make payment on the said date
and so Barbie did not like it and refused to make delivery. Decide.

a. Barbie cannot rescind the contract for non payment of the price.
b. Barbie can rescind the contract for non payment of the price.
c. Barbie cannot refuse to deliver the goods.
d. Diego is not entitled to recover damages.

77. I. Naruto hired Hinata for P10,000 to kidnap Sasuke, and paid Hinata in advance. Before
Hinata could kidnap Sasuke, and Naruto relented and stopped Hinata from performing the
contract. The court may not allow Naruto to recover from Hinata the P5,000 he paid in advance.

II. Luffy, at the point of a gun, compels Nami to marry him. Since the contract of marriage is
voidable, either Luffy or Nami has the right to file the action or annulment.

a. Only the first statement is true

b. Both statements are false
c. Only the second statement is true
d. Both statements are true

78. Contracts entered into during lucid interval are:

a. Voidable
b. Valid
c. Void
d. Unenforceable

79. The following may be valid objects of a contract, except:

a. All that are within the commerce of man

b. All services which are not contrary to law
c. Impossible things or services
d. All rights that are transmissible

80. A meeting of minds between two persons whereby one binds himself with respect to the
other to give something or to render some service is known as:

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 a. Obligation
b. Contract
c. Consent
d. Stipulation

81. The elements of a contract without which a contract would not exist are known as:

a. Accidental elements
b. Natural elements
c. Essential elements
d. Special elements

82. A contract that can stand by itself is known as:

a. Accessory contract
b. Commutative contract
c. Principal contract
d. Gratuitous contract

83. A contract that does not have any special name under the law is known as:

a. Nominate contract
b. Special contract
c. Innominate contract
d. Nominal contract

84. the contracting parties may establish such stipulation, clauses, terms and conditions as they
may deem convenient provided they are not contrary to law, morals, good customs, public order,
or public policy. This is known as the principle of:

a. Obligatory force of contracts

b. Mutuality of contracts
c. Liberty of contracts
d. Relativity of contracts

85. The contract must bind both contracting parties, its validity or compliance cannot be left to
the will of one of them. This is known as the principle of:

a. Obligatory force of contracts

b. Mutuality of contracts
c. Liberty of contracts
d. Relativity of contracts

86. Lina borrowed P500,000 from Rylai. Lina died without having paid her loan obligation to
Rylai. She left Luna, her daughter and heir, properties worth P400,000.

a. Luna is liable to Rylai for P500,000

b. Luna is liable to Rylai for P100,000
c. Luna is not liable at all because she should not be made to shoulder the obligation of her
mother
d. Luna is liable to Rylai for P400,000

87. A contract may be enforced by or against a third person, except:

a. In the case of stipulation pour autrui

b. When a third person induces another to violate his contract

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 c. In case of contracts intended to defraud creditors
d. When the benefit to the third person is merely incidental

88. The principle that contracts are perfected by mere consent is known as:

a. Obligatory force of contracts

b. Mutuality of contracts
c. Consensuality of contracts
d. Relativity of contracts

89. One of the following is not a real contract:

a. Pledge
b. Commodatum
c. Deposit
d. Sale

90. It is the manifestation of the meeting of the offer and the acceptance upon the thing and the
cause which are to constitute the contract.

a. Consideration
b. Contract
c. Cause
d. Consent

91. The following are instances which will render an offer ineffective before acceptance is
conveyed, except:

a. Civil interdiction of either party

b. Insolvency of either party
c. Intoxication of either party
d. Insanity of either party

92. The following are not incapable of giving his consent.

a. Insane persons
b. Somnambulist
c. Deaf-mutes who know how to read
d. Unenmancipated minors

93. A contract in which one of the parties is incapacitated:

a. Void
b. Rescissible
c. Voidable
d. Unenforceable

94. Contracts entered into in a state of drunkenness or during hypnotic spells are:

a. Void
b. Rescissible
c. Voidable
d. Unenforceable

95. Contracts that are effective upon execution by may be invalidated later.

a. Void

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 b. Rescissible
c. Voidable
d. Unenforceable

96. Which of the following contracts is voidable?

a. Those where both parties are incapable of giving consent to a contract.

b. Those where the consent is vitiated by mistake, fraud, violence, intimidation or undue
influence
c. Those undertaken in fraud of creditors when the latter cannot in any other manner collect
the claims due to them
d. Those whose object is outside the commerce of men

97. Which of the following contracts is rescissible?

a. Those where one of the parties is incapable of giving consent to a contract.

b. Those which are entered into by guardians whenever the wards whom they represent
suffer lesion by more than ¼ of the value of the object of the contract
c. Those where both of the parties are incapable of giving consent to a contract
d. Those which are absolutely simulated or fictitious

98. Bong sold her lot consisting of 1,000 square meters to Lani. However, the deed of sale signed
by the parties showed a total area of 1,200 square meters due to the secretary’s mistake. Later,
Bong discovered the mistake. What remedy is available to either party?

a. Rescission
b. Reformation
c. Annulment
d. Declaration of nullity

99. On June 1, Manny offered to sell a specific generator set to Isko for 300,000. Isko sent his
letter of acceptance to Manny on June 8. On June 10, however, Isko became insane. On June 12,
Manny received Isko’s letter of acceptance.

a. The contract was perfected on June 8 when Isko sent his letter of acceptance, at which
time he was still sane.
b. The contract was not perfected because the insanity of Isko occurred before Manny came
to learn of the acceptance of his offer by Isko.
c. The contract was perfected on June 12 when Manny learned of the acceptance.
d. The contract was perfected on June 1 because the acceptance made by Isko on June 8
retroacts to the date of the offer.

100. On March 1, Goku sent a letter offering the sale of his car for P200,000 cash to Vegeta. In
his letter, Goku stated that Vegetas’s acceptance should be sent by registered mail and must be
received by Goku not later than March 31. On March 20, Vegeta accepted the offer of Goku by
sending an e-mail message on the same day to Goku whose e-mail address was indicated in the
letter. Goku read the message the following day, March 21. Was there a perfected contract
between Goku and Vegeta.

a. Yes, on March 1.
b. No, no contract was perfected at all.
c. Yes, on March 20.
d. Yes, on March 21.

--------------------- NOTHING FOLLOWS ---------------------

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