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This set of Philippines Civil Law Society Multiple Choice Questions & Answers (MCQs) focuses on Albano Set 10
Q1 | A is the owner of a parcel of land covered by TCT No. 1. Through an oral agreement between B & A. A agreed that the property be registered under the name of B so that he can use it in securing a loan with Metrobank. When A sought to recover the property from B, the latter refused contending that he was the owner of the same. Is the contention of B correct?
- B is correct because his ownership is evidenced by a title.
- B is wrong because he is holding the property merely in trust for A.
- B is correct because A cannot prove that there is trust considering that the same was not put into a public instrument.
- A can recover and prove that there was trust even if not in a public instrument because the requirement is merely for purposes of convenience.
Q2 | With abuse of confidence, A was able to register a real property belonging B in 1990. B discovered it in 2011. Can B file an action to recover his property?
- Yes, because the title of A is void;
- Yes, provided that he files an action within four (4) years from the discovery of the act of A;
- No, because the action has prescribed as 10 years have already passed since the registration of the property;
- Yes, because there was no act of repudiation of the trust.
Q3 | Which of the following statements is correct?
- A verbal trust on immovable is void;
- Verbal trust on immovable may be proven as the requirement that it be in writing is not for its validity but for purposes of enforceability;
- Verbal trust on immovable cannot be waive since the law requires it to be in writing which is mandatory;
- Verbal trust on immovable cannot be proven in court as it is covered by the Statute of Frauds.
Q4 | A sold a car to B on installment basis secured by a chattel mortgage over the thing and a promissory note co-signed by C. A failed to pay four (4) monthly installments. Under the contract in case of non-payment, the vendor can exercise any of the remedies under Art. 1484, NCC and in case of deficiency, the seller can recover the balance. What is the remedy of A?
- A can file an action for the foreclosure of the mortgage and recover the unpaid balance because of the contract.
- A can foreclose the mortgage and recover the unpaid balance because the Chattel Mortgage Law does not prohibit recovery.
- A can foreclose the mortgage but cannot recover the unpaid balance because it is absolutely prohibited by law.
- A can foreclose the mortgage and can recover the unpaid balance from C since B & C are solidarily liable.
Q5 | A entered into a contract of sale over his undivided 1/5 of the estate of his father during the pendency of the intestate proceeding with the condition that the same shall be approved by the intestate court. Is the contract valid?
- The contract is void because the right is a mere expectancy since the estate has not yet been divided.
- The contract is valid only if the court approves it.
- The contract is valid because the condition that it be approved by the court is a mere condition for performance.
- The contract is void because approval of the court must be obtained before the sale.
Q6 | A sold a parcel of land covered by TCT No. 9 to B. At the time of the sale, B knew that C has been in possession of the parcel of land as early as 10 years before the sale. B however checked with the Registry of Deeds and found the title to be clean. Is B a buyer in good faith?
- B is a buyer in good faith because at the time of the sale, the title was clean.
- B is a buyer in good faith because he merely relied upon the face of the title.
- B is not a buyer in good faith because he had actual knowledge of facts and circumstances that would impel him to make inquiry into the status of the land due to the presence of C.
- B is a buyer in good faith because there was no annotation of C’s right if there be any.
Q7 | A is the owner of a parcel of land. He entered into a contract to sell with B with an obligation to pay the price within one (1) year. B failed to pay. State the effect of non-payment.
- The contract is rescissible, for failure of B to pay.
- The contract is void for failure to pay the price.
- A does not need to perform an act of rescission because the payment of the price is a positive suspensive condition, the happening of which would result in A executing the deed of sale.
- A can go to court and compel B to pay.
Q8 | A & B entered into a contract of sale, A, obligating himself to deliver his house and lot to B who obligated himself to pay P2M upon delivery. B has already paid, but A has not delivered the house and lot despite demand. State the remedy of B.
- B can sue A for rescission of the contract because of breach of contract.
- B can sue A for rescission because of a material breach.
- B can sue A for rescission because of lesion.
- B can sue A for declaration of nullity of the contract.
Q9 | What is the nature of a contract which states that in case the buyer complies with the terms and conditions of the same, the seller shall execute and deliver to the buyer a deed of sale?
- Contract of sale;
- Contract to sell;
- Conditional sale;
- Installment sale.
Q10 | X and Y entered into a contract of sale over a parcel of land with an area of 4,000 square meters more or less. When the title was issued, it was 14,475 sq. meters. The buyer contended that he owned the whole lot of 14,475 sq. meters as it was sold in lump sum, hence, the seller should deliver the whole lot. Is the buyer correct?
- The buyer is correct because in sale in lump sum, the whole property is sold regardless of the area;
- The seller can be compelled to deliver the 14,475 sq. meters because it is covered by the phrase “more or less”;
- The seller cannot be compelled to deliver the 14,475 sq. meters because the phrase “more or less” covers only a reasonable excess deficiency;
- The seller can be required to deliver the 14,475 sq. meters because the numerical data are not the sole gauge of unreasonableness of the excess or deficiency in area.
Q11 | A, B, C, D are the co-owners of a parcel of land. A sold his undivided share to X with the knowledge of his co-owners. One (1) year after the sale, they wanted to exercise the right of legal redemption, but A and X refused. Whose contention is correct?
- They are not entitled to exercise the right of legal redemption because the 30-day period has already lapsed as they knew of the sale;
- They can exercise the right of legal redemption within 20-days from receipt of written notice of the sale;
- They cannot exercise the right of legal redemption because knowledge of the sale is not equivalent to registration hence, the 30-day period has already lapsed;
- They cannot exercise the right of legal redemption due to estoppel.
Q12 | A sold his house and lot to B worth P1M for P100,000.00. Is the sale valid?
- Yes, even if there is gross inadequacy.
- Voidable;
- No, because the price is simulate
Q13 | A and B entered into a contract of sale over A’s house but did not reflect the actual purchase price. What is the nature of the contract?
- Valid and relatively simulated contract but can be reformed.
- Void as there is total lack of consideration.
- Voidable due to lack of consideration.
- Unenforceable.
Q14 | A sold his house to B for an agreed price. Before it could be delivered it was hit by lightning and it was totally lost. State the effect of the loss.
- A bears the risk of loss as he has not yet vested ownership to B.
- A has to bear the risk of loss because he was in possession of the house at the time of loss.
- B bears the risk of loss as an exception to the principle of res perit domino;
- A has to bear the risk of loss since he was negligent.
Q15 | What is the nature of an earnest money?
- Same as option money.
- It is proof of an intention to buy.
- It is actually a partial payment of the purchase price and considered as proof of the perfection of the contract. (Topacio v. CA, 211 SCRA 219; Laforteza v. Machuca, 333 SCRA 642)
- It forms part of the consideration even if the sale is not perfected or consummated. (Chua v. CA, 401 SCRA 54)
Q16 | A entered into a contract of sale with pacto de retro over B’s house & lot. The house is valued at P10M. B failed to exercise the right to repurchase. State the effect of B’s failure to exercise the right to repurchase.
- B can consolidate his ownership to become the owner.
- B need not consolidate his ownership because by the mere lapse of the period to repurchase, he became the owner.
- B cannot consolidate his ownership because that would amount to pactum commissorium.
- B cannot sell the property as he is the owner.
Q17 | A, a practicing lawyer represented B in the intestate proceedings of his father. The agreement is on a contingency basis as B did not have money to pay the services of A. To secure the payment of B’s obligation, they executed a mortgage over ¼ of what B will receive from the estate of his father. Is the mortgage valid?
- Yes, because what is prohibited by law is sale between the client and the lawyer;
- Yes, because it merely serves as security for the payment of an obligation;
- No, because even if what is prohibited by law is sale, it is a circumvention of the law;
- Yes, because of the liberty of contracts.
Q18 | A obtained a loan from B. To secure the payment of the obligation, A delivered the warehouse quedans to B and authorized him to sell the sugar in case of default. The warehouse and the sugar were burned. Who bears the loss?
- B bears the loss because he became the owner of the sugar when the quedans were delivered to him;
- B because of the principle of res perit domino;
- By reason of the principle of res perit domino A bears the risk of loss;
- B because of the constructive delivery of the sugar.
Q19 | In the following, there is no need for the issuance of a license to sell, except:
- Sale of subdivision lot resulting in the partition by co-owners;
- Sale of the original purchaser of a subdivision lot or his heirs;
- Sale by a subdivision developer;
- Sale of a subdivision lot for the account of the mortgagee.
Q20 | If there is a subdivision lot buyer and there is no development and he does not pay, to what extent can he ask for reimbursement of his payments?
- Total amount paid;
- 25%;
- 50%;
- Total amount paid including interest but excluding delinquency interest at the legal rate.
Q21 | The following rules are correct in case the buyer of a subdivision lot fails to pay the installments, except:
- He is given a grace period of 20 days for every year of payment;
- He is entitled to 50% reimbursement of payment;
- There may be cancellation of the contract 30 days after receipt of notice of cancellation;
- All payments are forfeited.
Q22 | A entered into a contract to sell over a residential lot. He has already paid more than 2 years installments. Thereafter, he failed to pay. What right does A have if the contract is cancelled?
- He has the right of reimbursement of all his payments regardless of the number of years of payment;
- He has the right to seek for a grace period of 1 month for every year of installment payments;
- He has the right of refund of the cash surrender value of the payments on the property equivalent to 50% of the total payments made;
- He has the right of reimbursement of 100% of his installments after payment for five (5) years.
Q23 | If the buyer of a subdivision lot in a contract to sell under the Maceda Lawfails to pay after payment of at least two (2) years of installments, can he still pay the balance?
- Yes, with additional interest he can pay the unpaid installments due with a grace period of one (1) month for every year of installment payments;
- Yes, without additional interest he can pay the unpaid installments with a grace period of one (1) month for every year of installment payments;
- Yes, provided that he pays additional amount of penalty;
- Yes, provided that he pays the full amount of the price.
Q24 | If the seller cancels the contract to sell under the Maceda Law, when will it take effect after receipt of notice of cancellation or demand for rescission by notarial act?
- 10 days
- 30 days
- 20 days
- One (1) year
Q25 | How often can the buyer under the Maceda Law make use of the grace period of one (1) month for every year of installment payments?
- Every 10 years of the life of the contract and its extensions if any;
- Every five (5) years of the life of the contract;
- Every two (2) years of the life of the contracts;
- There is no limit.