Académique Documents
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BUSINESS LAW
CONTRACTS
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ATTY. MACMOD
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75. Statement No. 1: A threat to enforce ones claim through competent authority, if the claim is just or
legal does not vitiate consent.
Statement No.2: Contracts entered into during a lucid interval are valid. Contracts agreed into a state
of drunkenness or during a hypnotic spell are binding.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
76. In three of the following defective contracts, ratification cleanses the defects. Which is the exception?
a. Both parties are incapable of giving consent
b. Sale of immovable property or interest orally entered into
c. Sale of piece of land thru an agent the authority is oral
d. Contracts entered into by a person who has been given no authority
77. Valid until annulled unless there has been ratification
a. Rescissible contract
c. Voidable contract
b. Inexistence contract
d. None of the above
78. In a contract of sale executed by S and B, it appears S sold his motor vehicle to B and B bought it for
P10, 000. It turned out however, S has three motor vehicles. Gallant valued P80, 000: Hi-Ace van
valued P70, 000; and a Jeep valued P60, 000. Which of the following is correct as remedy?
a. The contract shall be reformed because there was mistake
b. The parties can ask for interpretation because the word Motor vehicle is ambiguous.
c. The parties can ask for annulment of the contract
d. There is no contract.
79. Example 1 S sold to B in private instrument his land. Later, B wanted to have the sale registered,
but registration requires a public instrument. In here, B may compel S to execute the needed public
instrument.
Example 2 S sold to B orally his specific land. After B paid S the price of the sale, he wants to
register the land in his name but he needed a public instrument of sale. In here B may compel S to
execute the needed public instrument.
a. Both examples are false
c. Only 2 is true
b. Only 1 is true
d. Both examples are true.
80. Statement No.1: Ratification of voidable contract is necessary for its validity.
Statement No.2: One can ask for the annulment of a contract based on dolo incidente.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
81. S was forced by X to sign a contract with B for the sale of specific property for P10, 000. C a creditor
of X is prejudiced by the contract. What can S do?
a. S may ask for annulment of the contract
b. S may ask for rescission of the contract
c. S may ask C to declare the contract avoided
d. C may ask for the annulment of the contract.
82. In the preceding number, what can C do?
a. C may ask for rescission of the contract
b. C may ask for the reformation
c. C may ask S to declare the contract voided
d. C may ask for the annulment of the contract.
83. Which of the following contracts is voidable?
a. Those where both parties are incapable of giving consent to a contract.
b. Those undertaken in fraud of creditors when the latter cannot in any other manner collect the
claims due to them.
c. Those where the consent is vitiated by mistake, violence, intimidation, undue influence or fraud
d. Those whose object is outside the commerce of men
84. Statement No. 1: A stipulation in a contract of lease, which provides that the tenant shall have the
right to continue in possession of the leased premises so long as he pays monthly rentals thereon, is
a valid stipulation.
Statement No. 2: The seller sold to a minor some necessaries in the amount of P600. The goods were
delivered to the minor who, in turn paid the purchase price therefore. The contract is unenforceable.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
85. S and B orally agree that S would sell and B wound buy Ss radio for P400, two years from the date of
the agreement. At the end of the two-year period, S refused to deliver the radio although B was willing
to pay.
a. B can compel S to deliver because B is willing to pay the price.
b. The contract falls under the Statue of Frauds, therefore unenforceable.
c. No Statue of Frauds because the price is less than P500.
d. The object is movable, oral contract is enforceable.
86. This kind of defective contract refers to that contract which is validly agreed upon because all the
essential elements exits, 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.
a. Voidable contract
c. Rescissible Contract
b. Void or Inexistence Contract
d. Unenforceable Contract
87. Must be in writing to be enforceable:
a. Lease of land for 12 months
c. Both of a and b
b. Lease of car for 18 months
d. None of a and b
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88. S, a minor, owns a specific property valued P50, 000. B, Capacitated, by means of fraud induced S to
sell his property to him (B) for P10, 000 which S did so. The contract is in writing.
a. The contract is binding from the start
b. The contract remains unenforceable because it falls under the Statue of Frauds.
c. The contract is rescissible because the ward suffered lesion by more then one-fourth of the
value.
d. The contract is void.
89. A contract entered into in violation of right of first refusal is:
a. Rescissible
d. Void
b. Voidable
e. None of the above
c. Unenforceable
90. A, a bachelor lawyer, raped W twice. Upon learning this, F the father of W, was able to force A to
marry W under pain of being sued in court and debarred from the practice of his law profession.
Which statement is correct?
a. The marriage may be annulled on the ground of force or violence
b. The marriage may be annulled on the ground of threat or intimidation
c. The defective marriage, may, however, be ratified
d. There was no defect, the marriage was perfectly valid
91. S owns an oil painting. Being in need of money, S sold the painting to B for P1, 000. After the sale it
was discovered that the painting was valuable and worth P5, 000.
a. S may rescind the contract on ground of lesion or inadequacy of cause
b. S may rescind the contract on ground of fraud
c. S may annul the contract on the ground of error
d. B is entitled to the benefit of the contract because it is valid and binding
92. Statement No. 1: An agreement which, by its terms and conditions, is to be performed within a year
from the making thereof is unenforceable even if entered into orally.
Statement No. 2: A contract involving fraud (dolo incidente) is voidable.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
93. Type of defective contract that creates no rights and impose no obligation, but are susceptible of
ratification.
a. Voidable contracts
c. Rescissible Contracts
b. Unenforceable Contracts
d. Void Contracts
94. D forced C to lend him P10, 000. The promissory note is in writing.
a. The contract is rescissible because the contract is fraudulent
b. The contract is void
c. C cannot demand payment from D because the contract is unenforceable
d. Contract remains to be valid
95. Which of the following contract is not valid?
a. Mutual promise to marry entered into orally
b. Sale of immovable property orally entered into
c. One of the parties in a contract is incapable of giving consent
d. Sale of immovable property thru an agent
96. Three of the following are void contracts. Which is the exception?
a. Contracts where the cause is immoral
b. Contracts to prevent a known supporter of a political rival from voting for his candidate
for a valuable consideration
c. Contracts with a valid consideration but with unlawful motives
d. Absolutely simulated contracts
97. Contract with a false cause is
a. Voidable
c. Unenforceable
b. Void
d. All of the above
98. Statement No.1: The action for annulment on the ground of fraud shall be brought within 4 years from
the time of the perfection of contract.
Statement No.2: If a valid contract is novated to a void contract, both contracts are considered void.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
99. Statement No.1: Advertisements for bidders are simply invitations to make proposals, and the
advertiser is not bound to accept the highest or lowest bidder, unless the contrary appears.
Statement No.2: Accidental elements of a contract are those agreed upon by the parties, and cannot
exist without being stipulated.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
100. A conferment of a direct benefit in a contract between two persons in favor of a third person who
must accept such benefit before the same is withdrawn is known as:
a. Policitacion
c. donation propter nuptias
b. Stipulation por autrui
d. Counter-offer
101. The guardian of an insane person sells a house and a lot belonging to the latter valued at P100, 000
to B, buyer for P74, 000 with the approval of the court. The contract is:
a. Valid
d. Unenforceable
b. Rescissible
e. Void
c. Voidable
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102. The following, except one, are the characteristics of void or inexistent contract. Which is the
exception
a. The defense of illegality of the contract is available to third person whose interests are not
directlty affected
b. They are not subject to ratification
c. The right to raise defense of illegality cannot be waived
d. The action or defense for declaration of their nullity or inexistence of the contract does not
prescribe
103.A intimidated B to marry his daughter. After a year, B would like to file an action for annulment but
could not do so because A was around to intimidate him. The marriage contract is
a. Rescissible
c. Void
b. Voidable
d. Unenforceable
104. Which of the following contract is enforceable even if not reduced in writing.
a. Lease of car for 2 years
b. Representation as to the credit of a third person
c. Lease of immovable for a period longer than one year.
d. Agreement for the sale of immovable property.
105. Simulation of Contract - Absolute or relative. Relative when:
a. Parties not bound at all
b. The contract is void
c. The parties conceal their true agreement
d. None of the above
106. Which of the following instruments is not subject to reformation?
a. Simple donations inter vivos wherein no condition imposed
b. Wills
c. When the real agreement is void
d. All of the above
107. Essential requisites of a contract:
a. Consent
c. Subject
b. Cause
d. All of them
108. The offeror need not know the acceptance by the offeree is the theory of:
a. Cognition
c. Expedition
b. Manifestation
d. B or C
109. One of the stipulations contained in the contract between M Company and its employees is that the
company shall pay a bonus to employees of the company who shall continue its employment for at
least 2 consecutive years, unless he quits or is discharged before the expiration of the period of 2
years. X, an employee of the company was discharged without just cause one week before the
completion of the two-year period:
a. X is not entitled to the bonus because his discharge was in accordance with the contract.
b. X is not entitled to the bonus, because the employers right to terminate is superior than the
right of the employee to be employed.
c. X is entitled to the bonus whether the discharge is with or without cause.
d. X is entitled to the bonus because the debtor company has voluntarily prevented the
happening of the condition.
110. Example No.1- W 16 years old, sold his house valued at P1 M for P50, 000 or a lesion by more than
one-fourth of the value of the said house.
Example No.2- A sold his land orally to B. The contracts are:
a. Both contracts are unenforceable
b. No. 1 is rescissible; while No.2 is unenforceable
c. 1st is voidable; while 2nd is unenforceable
d. Both contracts are binding
111. Statement No.1:Pledge is an example of a formal contract
Statement No.2: Innominate contracts are exclusively regulated by the stipulations of the parties.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
112. Statement No.1: Validable contracts can be voided within the period allowed by law.
Statement No.2: There is undue influence if insidious words or machinations were employed by a
party on the other just to obtain the latters consent, without which the latter would not have entered
into the contract.
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
113. B1 Company bought out a competitor, B2 Corporation, with a stipulation that B2 Corporation should
not thereafter engage in any business in the Philippines unless consented to and approved by B1
Company.
a. The stipulation is defective but subject to ratification.
b. The stipulation is valid because the parties are free to enter into any stipulation,
terms and conditions such as this one.
c. The stipulation is unenforceable as there was no showing that the sale as done in
writing
d. The stipulation is void because it is contrary to public policy.
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114. 1st S. Place and modes of payment are example of natural elements
2nd S. Agency, partnership and sale are example of preparatory & counsensual contracts
a. Both are true
c. No.1 is true; No. 2 is false
b. Both are false
d. No.1 is false; No. 2 is true
115. All are void contracts except:
a. Those whose object is outside the commerce of men.
b. Those which are relatively simulated or fictitious.
c. Those with unlawful consideration.
d. Those which contemplate an impossible service.
---END--It is so important that you are grateful for everything in your life. Many people focus on the one thing they
want and then forget to be grateful for all the things they have. Without gratitude you cannot achieve
anything through the law of attraction, because if you are not emanating gratitude from your being, then
by default you are emanating ungratefulness. Be proactive and use the frequency of your being to receive
what you want.
-The Secrets by Rhonda Byrne