II.

Certain Financial Transactions and Documents

A. Loan Transactions

1. Analysis of Parts of a Loan Agreement

(a) Preamble
(b) Terms of Loan
Dio vs. Japor, 463 SCRA 170 (2005)
Consolidated Bank and Trust Corporation vs. Court of Appeals, 365
SCRA 671 (2001)
Macalinao vs. Bank of the Philippine Islands, 600 SCRA 67 (2009)
(c) Yield Protection (disaster clause, tax gross-up clause)
(d) Representations and Warranties (pari passu representation)
(e) Negative and Affirmatibe Covenants (negative pledge)
(f) Conditions Precedent
(g) Events of Default (MAC clause cross-default/cross-acceleration clause)
China Banking Corporation vs. Court of Appeals, 461 SCRA 162 (2005)
Mondragon Leisure and Resorts Corporation vs. Court of Appeals, 460
SCRA 279 (2005)
(h) Miscellaneous (judgment currency clause, sharing clause)

2. Closing opinion

3. Loan Transfers and Participations

(a) Section X238, Manual of Regulations for Banks
(b) Participation vs. Assignment

4. Other Issues
(a) BSP approval and/or registration
(b) Notarization (Article 2244(14), Civil Code)
(c) Documentary Stamp Tax (DST) (Section 179, NIRC)
(i) Upon execution
(ii) Upon transfer (RMC No. 13-87; Section 199(f), NIRC)
(d) Truth-in-Lending Act (Republic Act No. 3765)
Development Bank of the Philippines vs. Arcilla, Jr., 462 SCRA
599 (2005)
Bank of the Philippine Islands vs. Yu, 610 SCRA 412 (2010)

B. Letters of Credit
Feati Bank and Trist Company vs. Court of Appeals, 196 SCRA 576 (1990)
Transfield Philippines, Inc. vs. Luzonj Hydro Corporation, 443 SCRA 307 (2004)
Philippine National Bank vs. Pineda, 197 SCRA 1 (1991)

1. Types
2. UCP 600/ISP 98

1
C. Security Devices and Other Credit Supports/Enhancements

1. Types
(a) Real Estate Mortgage
(b) Chattel Mortgage
(c) Mortgage Trust Indenture
(d) Pledge
(e) Guarantee /Suretyship/Standby Letter of Credit
Insular Bank of Asia & America vs. IAC, 167 SCRA 450 (1198)
Games and Garments Developers, Inc vs. Allied Banking Corporation,
762 SCRA 447 (2015)
International Finance Corporation vs. Imperial Textile Mills, Inc. 475
SCRA 149 (2005)
Transfield Philippines, Inc. vs. Luzon Hydro Corporation, 443 SCRA
307 (2004)
Ong vs. Philippine Commercial International Bank, 448 SCRA
705 (2005)
JN Development Corporation vs. Philippine Export and Foreign Loan
Guarantee Corporation, 468 SCRA 555 (2005)
(f) Aval
(g) Hold-out
(h) Assignment by way of security
People's Bank and Trust Co. vs. Odom, 64 Phil. 126 (1937)
Lopez vs. Court of Appeals, 114 SCRA 671 (1982)
Manila Banking Corporation vs. Teodoro, 169 SCRA 95 (1989)
175 SCRA 295 (1989)
Yau Chu vs. Court of Appeals, 177 SCRA 793 (1989)
Caltex (Philippines), Inc. vs. Court of Appeals, 212 SCRA 48 (1992)
(i) Trust Receipt
Allied Banking Corp vs. Ordonez, 192 SCRA 246 (1990)
Ng vs. People, 619 SCRA 291 (2010)
Dela Cruz vs. Planters Products, Inc., 691 SCRA 28 (2013)
Hur Tin Yang vs. People, 703 SCRA 606 (2013)
Colinares vs. Court of Appeals, 339 SCRA 609 (2000)
Development Bank of the Philippines vs. Prudential Bank, 475 SCRA
623 (2005)
Rosario Textile Mills vs. Home Banking Savings and Trust Company,
462 SCRA 88 (2005)
Vintola vs. IBAA, 150 SCRA 578 (1987)
People vs. Nitafan, 207 SCRA 726 (1992)
(j) Set-off/Netting
Traders Royal Bank vs. Castanares, 636 SCRA 519 (2010)
(k) Comfort Letter
Section 41, General Banking Law of 2000
2. Certain Issues
(a) Validity of "after-acquired property" amd "after-incurred-obligation"
clauses in a chattel mortgage
Article 2091, Civil Code
Torres vs. Limjap, 56 Phil. 141 (1931)

2
 People's Bank and Trust Co. vs. Dahican Lumber Company
20 SCRA 84 (1967)
Belgian Catholic Missionaries vs. Magallanes Press,
49 Phil. 647 (1926)
Acme Shoe, Rubber and Plastic Corp. vs. Court of Appeals,
260 SCRA 714 (1996)
Ong Liong Tiak vs. Luneta Motor Co., 66 Phil. 459 (1938)
Prudential Bank vs. Alviar, 464 SCRA 353 (2005)
Cuyco vs. Cuyco, 487 SCRA 693 (2006)
(b) No definciency claim in a plegde
(c) Deficiency claim in a chattel mortgage; exception (Article 1484, paragraph
(3), Civil Code)
Garrido vs. Tuason, 24 SCRA 727 (1968)
PCI Leasing and Finance, Inc. vs. Trojan Metal Industries,
638 SCRA 615 (2010)
Magna Financial Services Group, Inc. vs. Colarina,
477 SCRA 245 (2005)
(d) Dacion en pago with repurchase (as an alternative to foreclosure of mortgage)
(e) Effect of "stay order" on enforcement of security
(f) Foreclosure of real estate mortgage
Section 47, General Banking Law of 2000
Republic Act No. 133 as amended
Register of Deeds vs. China Banking Corporation
4 SCRA 1145 (1962)
Paderes vs. Court of Appeals, 463 SCRA 504 (2005)
Banco Filipino Savings and Mortgage Bank vs. Court of Appeals,
463 SCRA 64 (2005)
Tanchan vs. Allied Banking Corporation, 571 SCRA 512 (2008)

III. Other Tax Matters

A. Applicable Taxes
1. Income tax
2. DST
3. GRT
B. Taxation of FCDU's and OBU's
Republic Act No. 9294
BIR Ruling No. 052-10
Union Bank of the Philippines vs. Commissioner of Internal Revenue,
CTC Case No. 7874 March 29,2011

C. Tax-minimizing structures
1. Omnibus agreement
2. "Originating bank" structure

IV. Project Financing

A. Mechanism
B. BOT and similar arrangements