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1. Which of the following reflects a correct legal precept? a. Private corporations under the Corporation Code are created by law. b. A private corporation may always be held civilly liable for negligent acts committed by its employees. c. The corporate obligations are, as a rule, not the obligations of the corporate officers as long as the absence of liability of the latter is reflected in the corporate by laws. d. Private corporations under the Corporation Code may either be de facto or de jure. 2. Which of the following is in conformity with both law and jurisprudence? a. The separate personality of a corporation may be disregarded when an incorporator dominates and controls the outstanding capital stock. b. Shareholders cannot maintain a suit in their own names to recover corporate property. c. A corporation does not fall within the constitutional protection against unreasonable searches and seizures. d. A corporation has a right against self-incrimination. 3. Ten persons, all Filipinos, and acting as incorporators, filed an application for the incorporation of XYZ Bank, Inc. Which of the following is correct? a. The incorporators are not disqualified by reason of their nationality. b. XYZ Bank, Inc. may issue no-par value shares as long as the consideration thereof is not less than P5.00. c. The incorporators must all be Philippine residents. d. None of the above. 4. When the articles of incorporation provide for non-voting shares, the holders of such shares shall nevertheless be entitled to vote on the following matters, except: a. Dissolution of the corporation. b. Sale, lease, exchange, mortgage, pledge or other disposition of all or substantially all of corporate property. Amendment of the articles of incorporation. c. Incurring, creating, increasing or assignment of bonded indebtedness.
5. ABC Corporation, a private corporation engaged in the business of importing used cars
from Japan was issued a certificate of incorporation by virtue of R.A. 27890. Because of a failed business transaction, ABC Corporation sued Mr. X for a damage arising from the latter’s alleged breach of its contractual obligations. a. Mr. X cannot allege “lack of legal capacity to sue’ of ABC Corporation in its motion to dismiss because it has a legal personality conferred by law. b. Mr. X cannot allege “lack of legal capacity” in its motion to dismiss because it is not allowed to attack the existence of the corporation collaterally. c. ABC Corporation is a de jure corporation and its existence can be attacked only through a quo warranto proceeding. d. Attacking the existence of ABC Corporation may be done through a motion to dismiss because its creation is void.
No 1 - Within five (5) years from issuance of its certificate of incorporation, the newlyformed corporation must formally organize and commence business operations. Failure to do so within such period is a ground for dissolution. No. 2 - Every member of the
The first statement is true. 8. d. c. b. (ii) That all of the issued stock of the corporation shall be subject to certain specified restrictions. Only to new issues of shares arising out of an increase of the capital stock. To all issues or dispositions of shares of any class other than redeemable or treasury shares. providing for the following (i) That all of the corporation’s issued stock of all classes. 10. Both statements are true. d. a. the first is false.board of every corporation must own at least one (1) share of stock standing in his name in the books of the corporation. the quorum in a board meeting is eight (8). 9. A year after its attainment of juridical personality. The corporation is a corporation by estoppel because although it operates as a corporation. d. a. and (iii) That the corporation shall not list in any stock exchange or make any public offering of any of its stocks of any class. a. The members of the board are liable whenever they vote for unlawful acts. He must be also a member of the board. The corporation is de facto because although it has a certificate of incorporation. b. Both statements are false. c. c. d. Acts of directors or trustees who are guilty of gross negligence or bad faith in directing the affairs of the corporation. not exceeding twenty (20). A director may be removed by the vote of all the stockholders in any meeting. thereby acquiring profits which should belong to the corporation. Which of the following acts could be ratified by a vote representing at least 2/3 of the outstanding capital stock? a. If there are only ten (1) directors elected although the articles of incorporation provide for fifteen (15) directors. The secretary of a corporation must be a citizen of the Philippines and a resident of the Philippines. Which of the following is correct? a. shall be held of record by not more than a specified number of persons. b. . To all issues of shares or dispositions of shares of any class. The pre-emptive right extends to the right to subscribe. the second is false. c. A corporation was formed by fifteen (15) incorporators and its certificate of incorporation was duly issued. The corporation is an open corporation. 7. Only to the issuance of previously unissued portions of the outstanding capital stock. Acts of directors constituting an approval of patently unlawful acts. it did not comply with certain legal requirements for the establishment of a close corporation. Acquisition of a business opportunity which should belong to the corporation. b. The corporation is a close corporation because the resolution contains the elements of a close corporation. the stockholders. An attempt by a director to acquire or actual acquisition of any interest adverse to that of the corporation in respect of any matter reposed upon him in confidence. b. The second statement is true. the provisions in the resolution should have been contained n the articles. c. who are themselves the members of the board adopted a resolution. exclusive of treasury shares.
The acquisition must be for a legitimate purpose. No. c. 13. it is indorsed to Jose in trust for my child. Which of the following is correct? a. The total liability of X. . a. 15. c. 17. X subscribed to 1.000 for 504 shares. No. a. The corporation must have unrestricted earnings in its books to cover the purchase of the shares except in the case of redeemable shares. c. All dividends are taxable as income of the stockholder. 2 is false. A bid of P43. b. accrued interest. 1 is true. 1 – Holders of delinquent shares are not entitled to dividends. indorsement and delivery of an instrument payable to the order of Jose. Which of the following is not a negotiation of a negotiable instrument? a. b. 12. b.000 shares of stock in ABC He paid 50% of the subscription but such subscription was later on declared delinquent. d. Delivery to the payee of an instrument payable to bearer. No 1 is true. d.000 for 300 shares. An indorsement is restrictive if: a. The declaration of any kind of dividend requires the assent of at least 2/3 of the outstanding capital stock. 2 is true. No.000 for 500 shares. c. Which is the exception? a. The corporation must have unrestricted earnings in its books to cover the purchase of shares. d. b. d. no. The acquisition must be for the sole purpose of acquiring shares in order to eliminate fractional shares. A bid of P45. 2 – A transfer of shares to a non-stockholder is binding to the corporation as long as the transfer is in a public document. b. 1 is false.11. it is indorsed to Jose or bearer. Which bidder is considered the highest bidder in the delinquency sale? a. c. No. The following are the requisites for the corporate power to acquire its own shares. d. Both statements are true. 2 – A foreign corporation engaged in business in the Philippines may sue and be sued n the Philippines. including the balance. A bid of P50. No. No. Both statements are true.000 for 900 shares. no. No. costs and other expenses amounted to P50. Delivery of an instrument payable to the order of Superman. d. b. 16.000. Delivery to the payee of an instrument payable to bearer Jose. c. c. No. b. Dividends are profits but not all profits are dividends. it is indorsed to Jose. Both statements are false. 1 – A foreign corporation intending to sue in Philippine courts must always have a license to engage in business n the Philippines. 2 is true. Both statements are false. Dividends may be declared out of a reappraisal surplus or revaluation increment because they constitute profits. 1 is false. A bid of P40. 2 is false. No. 14.
The following instrument is negotiable assuming all other requisites are present: a.000 on the day his father passes away. Sgd P”. A cannot negotiate the note any further. d. B can collect from X. c. B is not a party to the note. All of the above. a. 22. d. B indorses the notes to X.000. A may negotiate to B by delivery alone. Through illegal means. d. Which among the following has a conditional promise hence. but X is. 20. it is payable to cash. c. X is a party accommodated. b. B cannot collect from X. 21. Pay to the order of P P50. DR. P indorses the note thus: “To A. c. a. B can collect from X after giving him a notice of dishonor. As payee. O Bank is liable to Drawer for reimbursement of the amount deducted from the account of Drawer. and deposits it in his account in M Bank which indorses the check for clearing with the words” All prior indorsements guaranteed”.Which is correct? a. P can still collect from Drawer. d. indorses the check to himself by forging P’s signature. If B cannot collect from the maker because of forgery of the latter’s signature. c. A may negotiate to B by indorsement completed by delivery.000 b. B to sign promissory notes of the borrowers as the lender/ payee. If B cannot collect from the maker. c.000 and deliver 10 sacks of rice. Pay to X or his order P50. b. The instrument is payable to bearer if a. b. 23. I promise to pay O or bearer P50. None of the above is conditional. Pay to the order of P P50. It is indorsed to the order of Jose. B is an accommodation party. it is payable to the order of cash. c. Sgd DR. d. it is payable to the order of the King of the Philippine Islands. B is not an accommodation party. a. I promise to pay Pedro Santos P50. d. it is payable as in all of the above.000 out of my money in your hands. b. 24. A is an assignee. . D issues a note payable to the order of P. c. B can never collect from X. b. 18. Sgd. To D.000 with interest.000 and such other sums he may be entitled to. I promise to pay P or his order P30. I promise to pay to the order of P P50. M Bank is liable to O Bank as an indorser. If B cannot collect from the maker. If B cannot collect from the maker because of forgery of the latter’s signature. d. X wants to lend money to third persons but asks his friend. non-negotiable? a. B receives no consideration for lending his name. X indorses a note sans recourse and delivers it to B. b. To D. F gets hold of the check. Drawer issues a check to the order of P drawn against O Bank. 19.d.
26. c. when a vessel makes a wrong maneuver in the second zone of collision. 32. The common carrier’s duty to observe extraordinary diligence in the vigilance over the 29. No. That the shipper will be liable only for P500. a. b. b. The doctrine of limited liability may not be availed of as a defense in the following cases. ends when the goods are lost in transit. No. No. The ship agent may be held liable in case the ship owner is not found. 1 – The maker engages to pay according to the tenor of his acceptance. d. It was established that the ship was unseaworthy but would have successfully completed the voyage had it not been for the typhoon. an entity must have a certificate of public convenience. No.00 only per luggage except if the shipper or passenger declares a higher value. 2 is false. Travel agencies as such are common carriers. ends when they are temporarily unloaded in transit. ends when the shipper has availed of his right of stoppage in transitu. c. It is possible for a customs broker to be a common carrier if it transports goods for a fee. 2 The indorser warrants that the instrument is genuine only n certain cases. 27. To be a common carrier.25. d. There is no exception. Both are false. d. whenever a collision occurs. b. The doctrine of last clear chance in case of collisions. Which of the following statements is not legally true? a. None of the above. b. goods. Which stipulation is not void? a. d. c. when there is no evidence as to which vessel is negligent. d. . The doctrine of inscrutable fault applies a. No one is liable. If there are liabilities under the Workmen’s Compensation Law. when there is collision. 2 is true. The vessel is insured. Common carriers are required to cater to every member of the public. Which is the exception? a. No. That the shipper will be liable for P500. a. b. The ship agent may not be held liable because he is acting for a disclosed principal. c. 1 is true. Which could be availed of as a complete defense by a common carrier? a. A commercial vessel was sunk when it was overtaken by a typhoon in the ocean. d. Both are true. b. d. b. 31. begins upon the execution of a bill of lading. c. a. The ship owner may invoke fortuitous event as a defense. c. If there are expenses incurred when the vessel was repaired before its loss. No. 30. b. 1 is false.00 per baggage. All forms of fortuitous events. c. Contributory negligence of the plaintiff. 28.
The insured shall have the right to change his beneficiary as a rule. 1 is true. O came to the warehouse to claim the goods alleging that the cement deposited by D were merely stolen by the latter. 2 is false. Y can recover because he is the owner. X died of a liver ailment. A wife has an insurable interest in the life of her creditor. When a passenger is carried gratuitously by a common carrier. deliver the cement to O because he is the owner. The shipper will be liable only for P500. if there is an agreement to the contrary. No. Both are true. a. . 2 is true. the duty of extraordinary diligence of the carrier ceases. If a loss occurs. W should . The interest of a beneficiary continues even if his negligence caused the death of the insured. Recovery can be had. Two years after the policy became effective. c. Terrorists cannot be insured because they are public enemies. 34. All are void. No. During the effectivity of the insurance. d.c. he sold the house to Y without a corresponding change in the policy but X continued to pay the premiums. No. d. X answered “NO”. 36. Confronted with conflicting claims of ownership.00 per baggage whatever be the value declared. The latter issued a negotiable warehouse receipt to D. b. Recovery cannot be had because of material misrepresentation. none of the above. 1 is false. No. c. b. 38. a. 39. d. the duty of extraordinary diligence may be lessened by stipulation. the duty of extraordinary diligence of the carrier continues for a limited period.A contract of suretyship can never be an insurance contract. The insurer is entitled to the payment of premiums as soon as the thing insured is exposed to the peril insured against. d. there is only a duty to observe ordinary diligence. b. d. c. b. X can recover from the policy because there was no change in the policy. c. D deposited 500 bags of cement in the warehouse of W. Recovery may be had under the policy because the ailment concealed was not the cause of death. if the insurer waives the premium in the meantime. Recovery cannot be had because of a material concealment. In answer to a question in the insurance application on whether or not he had suffered from a heart ailment. Both are false. The insurer may legally refuse to pay. 35. No. b.When there is double insurance. X can recover because he is the one who is paying the premiums. Which is false? a. 33. a. At the same time D arrived in the warehouse claiming the cement and presenting the warehouse receipt. d. if the insured deposits a check. 37. 2 . d. c. c. b. X insured his house against fire. 1 . a. there is always over insurance. Five months after. except a. a. No.
a. Both are true. 1 is true. 1 is true. If the debt is not paid. V must notify his creditors before selling all the contents of the truck. buying and selling foreign exchange and gold and silver bullion and lending money against the borrower’s security in property. No. No. c. d. Universal bank. V does not have to perform any of the above because his sale is in the ordinary course of business. 44. compel the claimants to interplead so the court could decide who has the right to the goods. d. V must prepare an affidavit listing his creditors. V does not have to perform any of the above acts if his business is not registered. c. As fiscal agent of the Philippine government. B cannot foreclose the mortgage. b. Both are false. no. He goes to Baguio City. No.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. Commercial bank. b. deliver the cement to D because he is the holder of the warehouse receipt. buys vegetable in bulk and after filing up his truck. No. c. No. no. 1 – A bank may be may lend to a single borrower more than fifteen (15%) of the bank’s unimpaired capital. a. B can foreclose the mortgage. 2 – A deposit in a bank in foreign currency may be inquired into provided the depositor gives his consent. he travels to Divisoria and sells all the contents of his truck. c. d. No. a. b. The mortgage is binding even to third persons because it is in a public instrument. 1 . No. No. orally or in writing. 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. 43. c. 2 is true. receiving deposits. c. Rural bank.A writ of garnishment directed to a bank deposit is prohibited by law. M mortgaged his concrete house located in a rented lot to B. As the watchdog of government funds. b. 2 is false . Both are false. b. If the debt is not paid. d. Both are true. 41. The deed of mortgage which is embodied in a public instrument is denominated as a chattel mortgage. b. As official depositary of the Philippine government. the amount of their credits and their due dates. 45.b. 1 is false. 40. d. d. d. 2 is false. 42. 1 is true. V is a vegetable buyer. 2 is false. 2 . The mortgage is totally void because the house is a real property. a. As financial adviser of the Philippine government. c. deliver the cement to D because he is the depositor. No. Thrift bank. No. a. Which among the following is not a function of the Bangko Sentral ng Pilipinas? a. discounting and negotiating promissory notes.
000. d. six deposits.000. c. (c) Time deposit P350. d. b. d. valid because no declaration had been made on the actual value of the baggage and Mr. opened and maintained the following accounts with Allied Bank Recto. three deposits. b. Mr. c. When the goods arrived in Manila. c. He therefore. b. executed a trust receipt agreement with the bank. c. any claim for loss cannot exceed P 2. d.00 on the ground that the airline ticket stipulates that unless a higher value is declared.00 for each baggage. one deposit. 50. X is only civilly liable to the bank. b. 49. The distribution of dividends from capital and the acquisition of corporate shares without corporate unrestricted retained earnings is not allowed by law because of: a. Mendoza sues the airline company. his wife his mother his mistress his daughter . However. Mendoza claims P 50. 48. (a) Savings deposit – P300. not valid as it is contrary to public policy.000. a.000. None of the above.000. X imports goods from Japan through a letter of credit issued by National Bank. Mendoza has not declared a greater value. despite the fact that the clerk had called his attention to the stipulation in the ticket. A check upon which the holder’s signature must appear twice. c. one to be affixed by him at the time it is issued and the second or counter-signature. They also have the same deposits with the same amount in Allied Bank Makati. otherwise it is incomplete. Jose and his wife. X may be deprived of his import license . PAL is willing to pay only P 4. The refusal of the airline company to pay the claim is: a. b. two deposits. 47. not valid as it is not in accordance with law. X may be sued for theft by the bank. (b) Demand deposit – P400. X had no money to pay for the balance of the importation.000. b. d. Perla. 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.46.00 for the loss of both of his suitcases during his flight from Manila to Davao via Philippine Air Lines. valid because Mr. c. The trust fund doctrine. certified check stale check traveller’s check answer not given 51. X got hold of the gods and sold the same but failed to remit to the bank the proceeds of the sale corresponding to his balance. X may be sued for estafa. Mr. d. Mendoza did not pay the corresponding freight charges. One of the following has no insurable interest in the life of Alberto: a. Mendoza did not pay any freight. The corporate entity doctrine. The corporate opportunity theory. to be affixed by him before it is paid. is called: a.
Contracts for water transportation from foreign ports to Philippine ports are primarily governed by: a. c. An instrument is rendered non-negotiable if. Where the articles of incorporation so provides. 57. b. Stocks issued for a consideration less than its par or issued value. b. d. c. a. Ultra vires acts are acts of a corporation which are: a. d. b. a. The Civil Code of the Philippines . Exercised by the Board of Directors but not ratified by the stockholders. the instrument is payable out of a particular fund. Assignment Delivery of a bearer instrument Indorsement completed by delivery of an instrument payable to order Delivery of an instrument to the payee 58. Not within the corporate powers conferred by the Code or articles of incorporation. c. answer not given. When no payment is made within two (2) months as fixed in the contract or call. d. b. When no payment is made within fifteen (15) days from the date as fixed in the subscription contract or in the call made by the Board of Directors. b. there is an indication of a particular fund out of which reimbursement is to be made. c. Necessary and incidental to the exercise of the powers conferred upon the corporation. d. there is an indication of a particular account to be debited with the amount.52. Where the shareholder does not pay fifty percent of the value of the shares to be subscribed. When does a stock become delinquent? a. b. c. Where a stockholder is delinquent in the payment of unpaid balance of his subscription. None of the above. This is not negotiation of a negotiable instrument. When no payment is made within one (1) month from date as fixed in the contract or call. c. When can a corporation deny pre-emptive right to stockholders? a. d. None of the above 54. d. Stocks issued for a consideration more than its par or issued value. 53. Delivery of check Tender of Central Bank notes Delivery of promissory note answer not given 55. None of the above 56. d. c. The following shall produce the effect of payment of debts: a. What are watered stocks? a. b. None of the above 59. Stocks issued for a consideration less than P10.
A voting trust is irrevocable during the time stipulated. The corporation may acquire and dispose of properties. The corporation’s exercise of corporate powers is not recognized by the courts for reason of public policy. d. 64. c. . claim has to be made for the damage sustained by goods. d. 62. as long as there is a binding subscription agreement. whether or not. The corporation has a nationality or citizenship. b. c. The claim should be made within twenty four (24) hours from receipt when the damage or average could be ascertained from the outside. d. Which of the following conforms with the requirements of the Corporation Code? a. d. The same as subscribed capital stock. The corporation may enter into contracts with another corporation. if it is a life insurance policy within 2 years from its inception or last reinstatement on the ground of concealment or misrepresentation if all the above is present 66. A voting trust is created for the purpose of conferring upon the trustee the right to vote and other rights pertaining to the shares. Every incorporator must be residents of the Philippines. A policy of insurance is contestable: a. The claim should be made within twenty four (24) hours from receipt when the damage or average could be ascertained only upon opening the package. c. The Code of Commerce Salvage Law Public Service Act Carriage of Goods by Sea Act 60. 61. Why is a de facto corporation not considered a de jure corporation? a. c. 65. b. d. None of the above. e. All voting trust agreements shall not exceed five (5) years. Because it failed to incorporate under existing statutory authority. 63. It represents the paid up capital stock. The claim should be made within three (3) days from receipt when the damage or average could be ascertained from the outside. The claim should be made upon receipt when the damage or average could be ascertained from the outside. Under the provisions of the Carriage of Goods by Sea Act. The stockholder remains the beneficial or equitable owner of the shares while the trustee is the legal owner. b. Which is not a consequence of the corporation’s separate personality? a.b. The same as authorized capital stock. must be a natural person and must own or subscribe to at least one share of stock. b. except treasury shares. d. fully or partially paid. b. c. c. Its corporate existence may be challenged in court by any taxpayer. a. b. As used in the Corporation Code. The total shares issued to subscribed or stock holders. c. The corporation may sue but it cannot be sued. d. “outstanding capital stock” means: a. Which one of the following is not a characteristic of a voting trust agreement? a.
68. An incorporator in a domestic corporation may be an alien and a nonresident. These requirements is a consequence of the. except: a. None of the above. c. 72. The theory of separate personality. 69. When the corporation allows the issuance of watered stocks. Incorporators are those who originally compose the corporation. When there is payment of dividends without unrestricted retained earnings. cash dividends b. The doctrine of general capacity. b.b. b. d. c. The law also requires that shares should not be issued below its par or issued value. members and incorporators. stock dividends d. c. Shares to be issued in payment of a previously contracted debt. Even if not denied. except in case of. d. Which of the following are prohibited considerations for the issuance of stocks? a. a. The trust fund doctrine. b. The Board of Directors alone may declare the following type of dividends. property dividends c. c. Shares to be issued in compliance with laws requiring stock offerings to the public. a. c. The doctrine of limited capacity. The following are the corporate officers of a corporation. The acquisition of shares and the declaration of cash dividends require that the corporation has unrestricted retained earnings. d. Shares to be issued in good faith with the approval of the stockholders representing 2/3 of the outstanding capital stock in exchange for property needed for corporate purposes. The pre-emptive right if not denied by the corporation generally extends to all issues of shares in proportion to a stockholder’s shareholdings. d. goodwill past services accounts receivables None of the above . Shares to be issued to incorporators. c. 67. Corporators are those who compose a corporation and is a term which includes stockholders. In the following cases. the right does not extend to certain specified issuances enumerated below. When the corporation releases or condones payment of the unpaid subscription. President Vice-President Treasurer Secretary 71. d. whose names are mentioned in the articles of incorporation majority of whom have signed the said articles. b. script dividends 70. b. the Trust Fund Doctrine is violated. Which is the exception? a. d. except: a.
d. The extent of insurable interest in non-life insurance depends on: a. c. Which of the following cannot be a close corporation? a. d. except: a. the desire of the assured b. the value of the thing to be insured c. contracts of adhesion c. Extension of term Appointment of an executive committee. unilateral contracts 79. Reduction of term.73. friend b. d. To declare stock dividends. A person has an insurable interest on the life of his: a. pro-forma contracts b. mining corporation stock exchange educational institution All of the above 76. appraisal right may be exercised. gratuitous 80. In the following instances. All provisions and stipulations in insurance contracts are prepared by the Insurer. To increase or decrease capital stock. To adopt. To deny pre-emptive right. spouse 78. the proceeds c. telling lies 81. c. Mandamus Extra-judicial sale Withholding of stock dividends Deduction from cash dividends 74. 75. In the following instances. d. Concealment in insurance is: a. b. amend or repeal the by-laws. b. Investment of corporate funds in another business or purpose. thus they are: a. c. b. The following are remedies available to a corporation to enforce payment of stocks except: a. grandfather c. failure to communicate c. 77. unlimited . approval of the majority of the board and concurrence of the stockholders representing 2/3 of the outstanding capital stock is necessary in the exercise of the powers except: a. c. the premium b. b. hiding the truth b. The cause or consideration in insurance contracts is: a.
c. if lost or destroyed because of an earthquake 83. A life insurance policy could no longer be questioned after two (2) years that the policy had been in force counted from: a. the policy remains compensable. c. a. 87. at the tine of the loss at the inception of the contract of insurance. a. attested by a proper judicial officer or a notary. arising from the operation of a ship. c. equipment and freight during the voyage. c. to the effect that damage suffered by the ship or her voyage was caused by storms or other perils of the sea. It rests on fundamentally on the unfairness of a corporate officer or director taking advantage of a prospect for his own personal benefit when the interest of the corporation justly needs protection. b. the thing insured under a fire insurance policy must be lost or destroyed: a. d. the inception of the policy the last reinstatement at the inception of the policy or from its last reinstatement 85. without any negligence or misconduct on his part. a. This doctrine is a recognition by the courts that the fiduciary standards could not be upheld where the fiduciary is acting for two entities with competing interests. If a thing insured under a fire insurance policy is lost or destroyed by some other means other than fire. This established rule provides that the liability of the ship owner or agent. if lost or destroyed because of volcanic lava c. . b. To be compensable. who is a fugitive and has a prize on his head an American or Canadian a citizen of a country with whom the Philippines is at war.82. Master’s Certificate Bill of Lading Affidavit of Desistance Maritime Protest Maritime Complaint 88. d. b. b. c. if the loss or destruction was a consequence of the effort to save the thing insured from being burned. Error in Extremis Rule Doctrine of Declared Limitation in Maritime Law Real Nature of Maritime Law Doctrine of Presumed Negligence of Common Carriers 89. b. c. b. A public enemy who cannot be the object of a life insurance contract is one: a. e. at the inception of the contract and at the time of the loss. b. 84. Insurable interest on the thing insured and insurance interest on the policy in property insurance or non-life insurance must be reposed on one and the same person: a. It is a written statement by the master of vessel. by a hostile fire by a friendly fire by voluntary scorching 86. is limited to the vessel.
b. b. c. and produces a new and useful result.a. “Ang Sarap Pinoy Ramen”. transportation. or if it can be foreseen. c. who has sufficient assets but who may be unable to meet his obligations as and when they fall due. which of the following is a not an element of a fortuitous event? a. As applied in Transportation Laws. The debtor was blameless d. namely. . Public Service Public Corporation Public Utility Commodities Trader 92. b. a cellular phone and a digital music player. telephone or telegraph service. c. Assignment of Rights Substitution of Creditors Subrogation 94. including its remedies or securities. d. The invention is not patentable because Samsung is a foreign corporation and it should file its application in its home country. d. may petition for more time within which to settle such obligations. It is a legal scheme whereby a debtor. The occurrence must be such as to render it impossible for the debtor to fulfill his obligation in a normal manner. 95. the convenience of having two gadgets in one. b. It is the substitution of one person in the place of another with reference to lawful claim or right. Lucky Me registered its trademark. c. Samsung invented a cellular phone that can also play digital music or MP3s. Lucky Me sued for trademark infringement. a. d. 93. It applied for the issuance of letters patent. d. The invention is not patentable because it is a combination of old functions which does not produce a new result. or the failure of the debtor to comply with his obligations. The obligor must be free from any participation in the aggravation of the injury resulting to the creditor. 90. The cause of the unforeseen and unexpected occurrence. c. a. so that he who is substituted succeeds to the rights of the other in relation to a debt or claim. it must be impossible to avoid. a. The invention is patentable because it combines existing elements. must be independent of human will. c. It must be impossible to foresee the event which constitutes the case fortuito. gas. water. b. The invention is patentable because it is a new product which is beneficial to the public. “Ang Sarap Pancit Palabok” with the Intellectual Property Office. It is a business or service engaged in regularly supplying the public with some commodity or service of public consequence such as electricity. a. Insolvency Proceedings Suspension of Payments Corporate Rehabilitation Voluntary Insolvency 91. e. b. Nissin subsequently introduced its new product. Corporate Entity Doctrine Corporate Interest Doctrine Business Judgment Rule Corporate Opportunity Doctrine.
Nissin is not guilty of trademark infringement because the trademark “Ang Sarap” is descriptive. d. each of whom has deposited some amount of money into the Foundation. Only the National Library is allowed to reproduce books and other works. Hence. It applied with the Bangko Sentral for authority to organize itself into a bank. Yes. None of the above . May the Foundation be granted the said authority? a. Pinoy Ramen. Center Book Store is the publisher of the book Legal Journal. hence not capable of exclusive appropriation. The copy of the Journal is marked “For Room Use Only” and is therefore not made available to the public outside of the Library. Yes.a. d. The reproduction is consistent with fair use. Allan purchased 2005 Civic V-tech from Honda Cars Manila (HCM) for P950. Yes. reproduced one copy of the Journal for lending to the University’s students for room use. All of the above e. b. The Credit Foundation of the Philippines is a non-stock corporation. The Bangko Sentral has the full discretion and expertise to grant authorities to register as banking institution. HCM can still foreclose the same. It is a rule that determines the nationality of a corporation on the basis of the place where the foreign corporation is incorporated or registered? b. College of Law. What would be the effect of the sale on the chattel mortgage contract? a. The word “Philippines” as part of a corporate name is reserved for government owned or controlled corporations.000. Yes. a. d. Nissin is guilty of trademark infringement because it did not register its trademark “Ang Sarap Pinoy Ramen”. c. Pancit Palabok. Nissin is not guilty of trademark infringement because its product. 96. c. a purchaser in good faith and for value. Allan failed to pay four (4) installments. c. It qualifies as a bank because its funds are obtained from more than 20 persons. No. Thereafter. The law only allows a library to photocopy a book if it is fragile or rare. Allan executed a promissory note and a chattel mortgage to secure payment thereof. c. d. What is the so-called “Grandfather Rule” under the Corporation Code? a. It is a rule that determines the nationality of the corporation on the basis of the nationality of its officers and directors. b. 97. The Library. The chattel mortgage is not extinguished because the mortgagee’s right to foreclose the same is in rem. which handles deposit of funds from its members and lends the same funds to the general public. Is the U. Only stock corporations can be organized as a bank. It is a rule that determines the nationality of a corporation on the basis of the nationality of the majority of the stockholders. No. It is composed of at least 100 natural persons. Nissin is guilty of trademark infringement because the trademark “Ang Sarap” is fanciful and arbitrary. 98. b.E. The chattel mortgage is not extinguished as it is an accessory contract. The chattel mortgage is extinguished as Magtanggol is a purchaser in good faith and for the value. 99. b. It donated one copy to the Library of the U. The chattel mortgage is extinguished because the SCM is stopped in not foreclosing the mortgage after Allan is in default in two installments. c. No. belongs to a different category from Lucky Me’s product. No. payable in twenty-four (24) monthly installments. Allan sold the car to Magtanggol.E. d. in order to preserve the original book. hence capable of exclusive appropriation. Law Library liable for copyright infringement.
It is a contract of indemnity It is a risk distributing device All of the above None of the above . It is an aleatory contract. c. b. e.100. d. The following are the outstanding characteristics of an insurance contract EXCEPT: a.
D 43. C 34. A 7. D 35. B 26. D 73. B 77. A 86. D 75. D 61. B 64. B 3. B 71. C 85. C 92. A 74. D 90. C 65. D 19. A 48. D 37. D 6. C 97. C 30. C 9. D 22. A 39. B 12. C 21. D 27. C 51. A 8. D 29. C 69. B 99. B 91. D 76. D 72. D 10. A 16. E . D 2. A 83. A 46. B 17. D 50. D 88. D 38. C 20. D 95. D 28. D 62. C 89. D 24. A 80. D 4. D 32. A 44.ANSWER KEY IN COMMERCIAL LAW 1. D 98. C 18. B 55. B 66. B 23. C 78. C 87. D 42. B 100. D 67. D 5. B 59. C 56. D 45. B 33. C 68. D 40. A 84. D 96. D 36. D 25. B 15. D 63. C 14. C 94. C 57. C 47. B 81. B 82. B 31. B 13. C 93. C 53. C 11. B 49. C 52. C 70. B 79. A 58. D 41. B 54. A 60.
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