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The answers are bolded. 1. A municipality may levy an annual ad valorem tax on real property such as land, building, machinery, and other improvement only if A. the real property is within the Metropolitan Manila Area. B. the real property is located in the municipality. C. the DILG authorizes it to do so. D. the power is delegated to it by the province. 2. Anne Lapada, a student activist, wants to impugn the validity of a tax on text messages. Aside from claiming that the law adversely affects her since she sends messages by text, what may she allege that would strengthen her claim to the right to file a taxpayer’s suit? A. That she is entitled to the return of the taxes collected from her in case the court nullifies the tax measure. B. That tax money is being extracted and spent in violation of the constitutionally guaranteed right to freedom of communication. C. That she is filing the case in behalf of a substantial number of taxpayers. D. That text messages are an important part of the lives of the people she represents. 3. There is no taxable income until such income is recognized. Taxable income is recognized when the A. taxpayer fails to include the income in his income tax return. B. income has been actually received in money or its equivalent. C. income has been received, either actually or constructively. D. transaction that is the source of the income is consummated. 4. Keyrand, Inc., a Philippine corporation, sold through the local stock exchange 10,000 PLDT shares that it bought 2 years ago. Keyrand sold the shares for P2 million and realized a net gain of P200,000.00. How shall it pay tax on the transaction? A. It shall declare a P2 million gross income in its income tax return, deducting its cost of acquisition as an expense. B. It shall report the P200,000.00 in its corporate income tax return adjusted by the holding period. C. It shall pay 5% tax on the first P100,000.00 of the P200,000.00 and 10% tax on the remaining P100,000.00. D. It shall pay a tax of one-half of 1% of the P2 million gross sales.
5. Amaretto, Inc., imported 100 cases of Marula wine from South Africa. The shipment was assessed duties and value-added taxes of P300,000 which Amaretto, Inc. immediately paid. The Bureau of Customs did not, however, issue the release papers of the shipment yet since the Food and Drug Administration (FDA) needed to test the suitability of the wine for human consumption. Is the Bureau of Customs at fault for refusing to release the shipment just as yet? A. Yes, because the importation was already terminated as a result of the payment of the taxes due. B. Yes, the Bureau of Customs is estopped from holding the release of the shipment after receiving the payment. C. No, if the amount paid as duties and value-added taxes due on the importation was insufficient. D. No, because the Bureau of Customs has not yer issued the legal permit for withdrawal pending the FDA’s findings. 6. Which theory in taxation states that without taxes, a government would be paralyzed for lack of power to activate and operate it, resulting in its destruction? A. Power to destroy theory B. Lifeblood theory C. Sumptuary theory D. Symbiotic doctrine 7. The spouses Helena and Federico wanted to donate a parcel of land to their son Dondon who is getting married in December, 2011. The parcel of land has a zonal valuation of P420,000.00. What is the most efficient mode of donating the property? A. The spouses should first donate in 2011 a portion of the property valued at P20,000.00 then spread the P400,000.00 equally for 2012, 2013, 2014 and 2015. B. Spread the donation over a period of 5 years by the spouses donating P100,000.00 each year from 2011 to 2015. C. The spouses should each donate a P110,000.00 portion of the value of the property in 2011 then each should donate P100,000.00 in 2012. D. The spouses should each donate a P100,000.00 portion of the value of the property in 2011, and another P100,000.00 each in 2012. Then, in 2013, Helena should donate the remaining P20,000.00. 8. Mia, a compensation income earner, filed her income tax return for the taxable year 2007 on March 30, 2008. On May 20, 2011, Mia received an assessment notice and letter of demand covering the taxable year 2007 but the postmark on the envelope shows April 10, 2011. Her return is not a false and fraudulent return. Can Mia raise the defense of prescription? A. No. The 3 year prescriptive period started to run on April 15, 2008, hence, it has not yet expired on April 10, 2011. B. Yes. The 3 year prescriptive period started to run on April 15, 2008, hence, it had already expired by May 20, 2011. C. No. The prescriptive period started to run on March 30, 2008, hence, the 3 year period expired on April 10, 2011. D. Yes. Since the 3-year prescriptive period started to run on March 30, 2008, it already expired by May 20, 2011.
9. Double taxation in its general sense means taxing the same subject twice during the same taxing period. In this sense, double taxation A. violates substantive due process. B. does not violate substantive due process. C. violates the right to equal protection. D. does not violate the right to equal protection. 10. The payor of passive income subject to final tax is required to withhold the tax from the payment due the recipient. The withholding of the tax has the effect of A. a final settlement of the tax liability on the income. B. a credit from the recipient’s income tax liability. C. consummating the transaction resulting in an income. D. a deduction in the recipient’s income tax return. 11. Guidant Resources Corporation, a corporation registered in Norway, has a 50 MW electric power plant in San Jose, Batangas. Aside from Guidant’s income from its power plant, which among the following is considered as part of its income from sources within the Philippines? A. Gains from the sale to an Ilocos Norte power plant of generators bought from the United States. B. Interests earned on its dollar deposits in a Philippine bank under the Expanded Foreign Currency Deposit System. C. Dividends from a two-year old Norwegian subsidiary with operations in Zambia but derives 60% of its gross income from the Philippines. D. Royalties from the use in Brazil of generator sets designed in the Philippines by its engineers. 12. Tong Siok, a Chinese billionaire and a Canadian resident, died and left assets in China valued at P80 billion and in the Philippines assets valued at P20 billion. For Philippine estate tax purposes the allowable deductions for expenses, losses, indebtedness, and taxes, property previously taxed, transfers for public use, and the share of his surviving spouse in their conjugal partnership amounted to P15 billion. Tong’s gross estate for Philippine estate tax purposes is A. P20 billion. B. P5 billion. C. P100 billion. D. P85 billion. 13. Anktryd, Inc., bought a parcel of land in 2009 for P7 million as part of its inventory of real properties. In 2010, it sold the land for P12 million which was its zonal valuation. In the same year, it incurred a loss of P6 million for selling another parcel of land in its inventory. These were the only transactions it had in its real estate business. Which of the following is the applicable tax treatment? A. Anktryd shall be subject to a tax of 6% of P12 million. B. Anktryd could deduct its P6 million loss from its P5 million gain. C. Anktryd’s gain of P5 million shall be subject to the holding period. D. Anktryd’s P6 million loss could not be deducted from its P5 million gain.
Yes. 15. It has extensive operations in Southeast Asia. Aplets Corporation is registered under the laws of the Virgin Islands. Aplets is doing business in the Philippines through its exclusive distributor Kim’s Trading. collect the tax levied under the law. In 2010.14. because there is no showing that the taxpayer’s 2009 and 2010 net profit before tax exceeded its paid-up capital. Inc. since the accumulation is not reasonably necessary for the immediate needs of the business. The actual effort exerted by the government to effect the exaction of what is due from the taxpayer is known as A. D. C. it is NOT the function of Congress to A. The BIR compiled a record of all the imports of Kim from Aplets and imposed a tax on Aplets net income derived from its exports to Kim. or an insurance company. .’s net profit before tax was P35 million while its operating expenses was P31 million. In the Philippines. a bank. fix with certainty the amount of taxes. because the taxpayer is not shown to be a publicly-listed corporation. C. No. assessment. Yes. In 2009. payment. Aplets is a non-resident foreign corporation not engaged in trade or business in the Philippines. May Spratz be subject to the improperly accumulated tax on its retained profits for 2009 and 2010? A. Spratz. levy. B. D. determine who should be subject to the tax. identify who should collect the tax. Inc. Its products are imported and sold at a mark-up by its exclusive distributor. Yes. C. 17. collection. D. Is the BIR correct? A. Inc. No. Although the power of taxation is basically legislative in character. D. No. since the accumulated amounts are reasonable for operations in relation to what it usually needed annually. Kim’s Trading. It did not declare dividends for 2009 and 2010. B. B. its net profit before tax was P40 million and its operating expenses was P38 million. The tax should have been computed on the basis of gross revenues and not net income. No. And it has no proposed capital expenditures for 2011 and the immediate future. B. C. Yes. Aplets is a non-resident foreign corporation engaged in trade or business in the Philippines. 16.
B. She had no other receipts for the year.00. B. 23. This type of income is A. the gains derived from the sale in California.S. migrated to the United States some six years ago and got a permanent resident status or green card.00. P500. P350. provided A.00. An example of a tax where the concept of progressivity finds application is the A.000. income tax on individuals.000. for the use of the barangay. D. it should change its accounting period two years prior to changing its taxable year.000. 21. dividends received from a two year old foreign corporation whose gross income was derived solely from Philippine sources.18. usually subject to a final tax. In 2010.000. C.00 as income from her beauty parlor and received P250. the gains derived from the sale in the New York Stock Exchange of shares of stock in PLDT. She spent P150. C. A corporation may change its taxable year to calendar or fiscal year in filing its annual income tax return. in consideration of marriage. D. excise tax on petroleum products.000. its constitution and by-laws authorizes the change. Juliet Ulbod earned P500.00 as Christmas gift from her spinster aunt. He should pay his Philippine income taxes on A. B. taxable only if earned by a citizen. a Filipino citizen. B. C. D. D. of jewelry he purchased in the Philippines. it seeks prior BIR approval of its proposed change in accounting period. 20.000. 19.000. 22. B. included in the income tax return. her gross income for 2010 is A. C. For tax purposes. P750. U.00. B. the proceeds he received from a Philippine insurance company as the sole beneficiary of life insurance taken by his father who died recently. it simultaneously seeks BIR approval of its new accounting period. D. . Passive income includes income derived from an activity in which the earner does not have any substantial participation.00 for the operation of her beauty parlor.A. a Philippine corporation. D. C. to a school which is a stock corporation. C. to a for-profit government corporation. value-added tax on certain articles. amusement tax on boxing exhibitions. exempt from income taxation. P600. Exempted from donor’s taxation are gifts made A. Federico.
Within 25 days from September 30 B. buys and sells “kumot at kulambo” both of which are subject to value-added tax. September. Exempt from income taxation if it is actually. and exclusively used for educational purposes. subject to the ordinary income tax rates with respect to incomes derived from educational activities. the BIR issued a ruling that Clemen’s vodka imports were not subject to increased excise tax based on his claim that his net retail price was only P200 per 750 milliliter bottle. This ruling was applied to his imports for May. Capital of the surviving spouse 26. B. subject to 10% tax on its net taxable income as if it is a proprietary educational institution. directly. What is the rule on the taxability of income that a government educational institution derives from its school operations? Such income is A. In January 2011. Which among the following reduces the gross estate (not the net estate) of a citizen of the Philippines for purposes of estate taxation? A. June. . Since he is using the calendar year as his taxable year. B. June and July 2011 vodka imports because it discovered that his net retail price for the vodka was P250 per bottle from January to September 2011. C. D. Yes. In September 2011. and July 2011. a sole proprietor.24. Yes. D. Property previously taxed C. When should Ka Pedring file the VAT quarterly return for his gross sales or receipts for the period of June 1 to September 30? A. and December. the BIR revoked its ruling and assessed him for deficiency taxes respecting his May. No. since he had already acquired a vested right in the favorable BIR ruling. Within 45 days from September 30 C. No. Standard deduction of P1 million D. Transfers for public use B. his taxable quarters end on the last day of March. Exempt from income taxation in the same manner as government-owned and controlled corporations. C. Within 30 days from September 30 27. because he acted in bad faith when he claimed a lower net retail price than what he actually used. Ka Pedring Matibag. 25. Within 15 days from September 30 D. since the presumption is that the BIR ascertained the facts before it made its ruling. since he could avail of remedies available for disputing the assessment. Does the retroactive application of the revocation violate Clemen’s right to due process as a taxpayer? A. June.
D. Forthwith. the tax to be divided equally among them. the taxpayer is an individual compensation income earner. On July 31. In his will. 180 days. C. Interests from his deposits in a local bank of foreign currency earned abroad converted to Philippine pesos. 60 days. D. Income is considered realized for tax purposes when A. Consultancy fees received for designing a computer program and installing the same in the Shanghai facility of a Chinese firm. C. the earning process is complete or virtually complete and an exchange has taken place. . Don Epitacio since the tax became due prior to his resignation. 30. executory. B. Don Epitacio. The BIR could not avail itself of the remedy of levy and distraint to implement.00. C. he resigned as administrator. 30 days. an assessment that has become final. B. B. the taxpayer has been paid and has received in cash or near cash the taxable income. he not being an heir. a French citizen permanently residing in the Philippines. 15 days. Which among the following is NOT subject to Philippine income taxation? A. it is recognized as revenue under accounting standards even if the law does not do so.00 deficiency income taxes on her 2009 income. the corporate taxpayer has no other uncollected tax liability. who may be held liable for the payment of the estate tax? A.28. the amount of the tax involved does not exceed P100. Gains derived from the sale of his condominium unit located in The Fort. C. Esperanza received a preliminary assessment notice from the BIR demanding that she pays P180. 29. D. Taguig City to another resident alien. Dividends received from an American corporation which derived 60% of its annual gross receipts from Philippine sources for the past 7 years. to be the administrator of the estate. and demandable where A. He named his compadre. As a result of the resignation. Don Fortunato. How many days from July 31. Alain Descartes. he left his estate of P100 million to his four children. he refused to pay claiming that he did not benefit from the estate. the taxpayer retires from the business without approval from the BIR. B. a widower. died in May. B. When the BIR sent a demand letter to Don Epitacio for the payment of the estate tax. D. The eldest child who would be reimbursed by the others. 2011. through collection. 32. C. 31. The person designated by the will as the one liable. the subject of the assessment is an income tax.000. 2011 should Esperanza respond to the notice? A. 2011. D. All the four children. received several items during the taxable year.
B. 34. The BIR assessment was seasonably protested within 30 days from receipt. 37. sixty days from the appointment of an administrator. C. . Spanflex still has not elevated the matter to the CTA. Yes. Business partnership engaged in energy operations under a service contract with the government. Since Miguel Foods was satisfied with the reduction. What remedy. it did not do anything anymore. Partnership exclusively for the design of government infrastructure projects considered as practice of civil engineering. It seasonably filed a protest with all the necessary supporting documents but the BIR failed to act on the protest. 36. 2011. B. Proof that the assessment is utterly without foundation. C. 2002 final adjustment return from the BIR. Miguel Foods then filed a request for reinvestigation together with the requisite supporting documents on April 25. D. received a notice of assessment from the BIR. arbitrary. Inc. D. 2005. No. can Spanflex take? A. His estate tax return should be filed within A. B. Which among the following circumstances negates the prima facie presumption of correctness of a BIR assessment? A. received a notice of assessment and a letter of demand on its April 15. six months from filing of the notice of death. None. On June 2. if any. 35. 2011. 2010 the BIR garnished the corporation’s bank deposits to answer for the tax liability. D. D. The BIR has 5 years from the issuance of the final assessment within which to collect. Joint account (cuentas en participacion) engaged in the trading of mineral ores. It may file a motion to admit appeal if it could prove that its failure to appeal was due to the negligence of counsel. the BIR action violated the Bank Deposit Secrecy Law. 2005. Joint-stock company formed for the purpose of undertaking construction projects. C. Thirty days from the lapse of 180 days from the filing of its protest. Gerardo died on July 31. No. the BIR issued a final assessment reducing the amount of the tax demanded. On April 15. 2011. B. six months from the time he died on July 31. C. It may no longer appeal since there is no BIR decision from which it could appeal. The BIR did not include a formal letter of demand to pay the alleged deficiency. D. B.33. Which among the following taxpayers is required to use only the calendar year for tax purposes? A. The taxpayer did not apply for a compromise. Yes. Spanflex Int’l Inc. On March 30. C. 2005 Miguel Foods. sixty days from the time he died on July 31. It may wait for the final decision of the BIR on his protest and appeal it to the CTA within 30 days from receipt of such decision. The BIR has 5 years from the filing of the protest within which to collect. Its right to appeal to the CTA has prescribed. No preliminary assessment notice was issued prior to the assessment notice. and capricious. Without the taxpayer’s prior authority. Was the BIR action proper? A.
D.00. Tonette sold her diamond ring.00 which it offered as a compromise to the BIR.38.25 million to buy a solo diamond ring in November 2009 which she sold for P1. D. Inc. from sale and lease of property. only from the sale of property. Tonette may deduct his 2009 loss only from her 2009 professional income.00. and a brooch for P500.5 million in September 2010. C. 41. B. from cash and gratuitous receipts of property.000. Which among the following describes the tax implications arising from the above transactions? A. a bracelet for P250. Tonette may not deduct her 2009 loss from both her 2010 professional income and her gain.? A. Which among the following may the BIR require to enable it to enter into a compromise with Anion. Anion must waive its right to the secrecy of its bank deposits. . In March 2009. Tonette. bought a diamond ring for P750.000. Anion must promise to pay its deficiency when financially able. B. only from the cash sales of property.00. bracelet. Its asset position shows that it could pay only P500. a necklace for P500.00 with the BIR.25 million incurring a loss of P250. Anion must show it has faithfully paid taxes before 2009. B. B. Tonette had no other transaction in jewelry in 2010. Tonette may carry over and deduct her 2009 loss only from her 2010 gain.000.000.000. leases the real property to a business establishment. C. 40. Inc. In October 2009. personal.00. Tonette derives income from the exercise of her profession as a licensed CPA. or mixed) is the gain or loss derived A. Tonette may carry over and deduct her 2009 loss from her 2010 professional income as well as from her gain. Real property owned by the national government is exempt from real property taxation unless the national government A. C. 39. Income from dealings in property (real. Anion. sells the property to a government-owned non-profit corporation. gratuitously allows its use for educational purposes by a school established for profit. D. C. Anion must immediately deposit the P500. She used the P1. who is fond of jewelries. The financial statements of the company show that it has been suffering financial reverses from the year 2009 up to the present. and necklace for only P1.000.000. received a notice of assessment and a letter from the BIR demanding the payment of P3 million pesos in deficiency income taxes for the taxable year 2008. transfers it for the use of a local government unit. D.00.
if the candidate supported wins the election because of possible corruption. property rights are not affected. administrative feasibility. B. . Yes. Dondon and Helena were legally separated. is suspended given that the CTA can reverse BIR decisions when prejudicial to the taxpayer. Five children. When a BIR decision affirming an assessment is appealed to the CTA. C. 46. for how many children could Dondon claim additional exemptions when he files his income tax return? A. C. D. Assuming that only Dondon is gainfully employed while Helena is not. symbiotic relationship. Six children. all qualified to be claimed as additional exemptions for income tax purposes. Real property taxes should not disregard increases in the value of real property occurring over a long period of time.42. 43. since they do not help earn the income from which they are to be deducted. Two children. C. since such amounts are not considered as income of the candidate to whom given. The court awarded the 6th child to Dondon’s father with Dondon also providing full financial support. C. if they are not reported to the Commission on Elections. 45. theoretical justice. is suspended to await the finality of such decision. is not suspended because only final decisions of the BIR are subject to appeal. D. Is this always so? A. The Executive Branch may decide not to enforce a tax law which it believes to be confiscatory. fiscal adequacy. C. They had six minor children. The tax collectors should enforce a tax law even if it results to the destruction of the property rights of a taxpayer. 44. Three children. D. The power to tax is the power to destroy. The Supreme Court may nullify a tax law. is not suspended since the continued existence of government depends on tax revenues. No. the BIR’s power to garnish the taxpayer’s bank deposits A. The court awarded custody of two of the children to Dondon and three to Helena. B. with Dondon directed to provide full financial support for them as well. Yes. Tax laws should always be enforced because without taxes the very existence of the State is endangered. D. D. hence. B. Political campaign contributions are NOT deductible from gross income A. B. No. B. To do otherwise would violate the canon of a sound tax system referred to as A.
000. keeping 60% for the province and giving 40% to the barangay. 100% of the actual project cost without giving any portion to the barangay.00 portion of the donation is exempt being a donation in consideration of marriage. interests derived from its dollar deposits in a Philippine bank under the Expanded Foreign Currency Deposit System. C. within what period must a taxpayer elevate to the Court of Tax Appeals a denial of his application for refund of income tax overpayment? A. involving deficiency income taxes only. Within 2 years from payment of the income taxes sought to be refunded. C..00 donation. 50. Within 30 days from receipt of the denial which must not exceed 2 years from payment of income tax. . What is the donor’s tax implication on Celia’s donation? A. 49. The P100. 60% of the actual cost. Inc.00 to her friend Victoria who was getting married. B. dividends earned from investment in a foreign corporation that derived 40% of its gross income from Philippine sources. As a general rule. may be subject to Philippine income taxation on A. the Sangguniang Panglalawigan may impose a special levy upon the lands specifically benefitted by the road up to an amount not to exceed A. Celia donated P110.000.000. B. because of doubt as to the validity of the assessment. B.00 portion of the donation is exempt since given in consideration of marriage. Celia shall pay a 30% donor’s tax on the P110. only when there is an approval of the National Evaluation Board.000. a corporation registered and holding office in Australia. The P100. gains it derived from sale in Australia of shares of stock of Philex Mining Corporation. After the province has constructed a barangay road. B. A P10. but not for other taxes. C. D. 48. C. Within 30 days from receipt of the denial or within two years from payment.00 portion of the donation is exempt under the rate schedule for donor’s tax. B. D. 100% of the actual project cost. dividing the same between the province and the barangay. D. 51. Jeopardy assessment is a valid ground to compromise a tax liability A. not operating in the Philippines. Zygomite Minerals.000.47. D. 60% of the actual cost of the road without giving any portion to the barangay. D. C. a Philippine corporation. Celia gave no other gift during the calendar year. Within 30 days from receipt of the Commissioner’s denial of his application for refund. if the compromise amount does not exceed 10% of the basic tax. gains it derived from sale in Australia of an ore crusher it bought from the Philippines with the proceeds converted to pesos.
The taxpayer’s liability remains suspended for 180 days from the expiration of the period to protest. C. No. directly. 55. C. and exclusively used for educational purposes. of Interior and Local Government determined. The BIR could already enforce the collection of the taxpayer’s liability if it could secure authority from the CTA. Yes. Yes. No. wages. A violation of the tariff and customs laws is the failure to A. B. D. B. Is he subject to donor’s taxes? A. C. The reasonable classification made by the provincial sanggunian. since the donation is actually. B. Yes. The pertinent provision of the local Government Code. What is the effect on the tax liability of a taxpayer who does not protest an assessment for deficiency taxes? A. non-profit school always had cash flow problems. because it is donated as prize for an international competition under the billiards association. 54. so long as the donated money goes directly to the winners and not through the association. 53. pay the customs duties and taxes. D. Don Leon donated P100 million pesos to the school. That which the Dept. D. it was held under the auspices of the International Professional Billiards Association. but only that part that exceeds the first P100.52. That which Congress determined.00 of total Levox donations for the calendar year. .000. C. D. What is the tax base for the imposition by the province of professional taxes? A. No. because the donation does not exceed 10% of his taxable income for 2010. Levox Corporation wanted to donate P5 million as prize money for the world professional billiard championship to be held in the Philippines. since the national sports association for billiards does not sanction the event. 56. Since the Billiard Sports Confederation of the Philippines does not recognize the event. B. C. The donation represents less than 10% of Don Leon’s taxable income for the year. B. Is Levox subject to the donor’s tax on its donation? A. The taxpayer’s liability becomes fixed and subject to collection as the assessment becomes final and collectible. Inc. A non-stock. because the donation is to be wholly used for administration purposes. D. In 2010. pay the customs duties and taxes or to comply with the rules on customs procedures. since he did not obtain the requisite NGO certification before he made the donation. Yes. The taxpayer may appeal his liability to the CTA since the assessment is a final decision of the Commissioner on the matter. pay the customs duties and taxes and to comply with the rules on customs procedures. resulting in failure to recruit well-trained administrative personnel to effectively manage the school. comply with the rules on customs procedures. No. provided the money shall be used solely for paying the salaries. and benefits of administrative personnel.
when the assessment was issued against a false and fraudulent return. 61. deductions claimed exceed by 30% the actual deductions. 59. tax return was filed beyond the reglementary period. C. B. C. because all articles that are imported from any foreign country are subject to duty. No. The proceeds received under a life insurance endowment contract is NOT considered part of gross income A. C. Is an article previously exported from the Philippines subject to the payment of customs duties? A. if there was a failure to pay the deficiency tax within 60 days from BIR demand. B. D. if it is covered by a certificate of identification and has not been improved in value. because exemptions are strictly construed against the importer who is the taxpayer. if the Regional Trial Court issues a writ of preliminary injunction to enjoin the BIR. . where payment is made as a result of the death of the insured. tax return was amended after a notice of assessment was issued. NOLCO. B. D. if it is so stated in the life insurance endowment policy. There is prima facie evidence of a false or fraudulent return where the A. No. Yes. B. D. ordinary loss. C. D. C. Yes. B. attributable to the undisputed issues in the assessment notice. net deductible loss. taxpayer changed his address without notifying the BIR. where the beneficiary was not the one who took out the endowment contract. The excess of allowable deductions over gross income of the business in a taxable year is known as A. net operating loss. because there is no basis for imposing duties on articles previously exported from the Philippines. 60. 58.57. if the price for the endowment policy was not fully paid. No action shall be taken by the BIR on the taxpayer’s disputed issues until the taxpayer has paid the deficiency taxes A. D.
D. C. a resident alien engaged in trade or business in the Philippines. No. Yes. Has the action prescribed? A. More than 5 years had lapsed for the collection of the deficiency taxes for the period 1990 up to 2005. 65. Pierre de Savigny. could not amend a special law such as the Cooperative Development Act. consumer’s cooperatives registered under the Cooperative Development Act enjoyed exemption from all taxes imposed by a local government. Prior to the enactment of the Local Government Code. More than 10 years had lapsed for the period 1990 up to 2000. D. The deficiency taxes for the period 1990 up to 2011 may still be collected within 10 years from March 2011. their exemption is specifically mentioned among those not withdrawn by the Local Government Code. government whatever be the circumstances.62. In March 2011. D. Ka Tato owns a parcel of land in San Jose. Yes. Yes. In 1990. No. 2010 and stayed until April 15. arrived in the Philippines on January 1. B. 2010. C. because the Local Government Code. a Frenchman. B. a general law. a resident alien not engaged in trade or business in the Philippines. Pierre’s taxable status is that of A. He earned during his stay in the Philippines a gross income of P3 million from his investments in the country. insurance company that covered the shipment. No. 2011 when he returned to France. a non-resident alien engaged in trade or business in the Philippines. he used the land for a poultry feed processing plant but continued to declare the property as agricultural. With the Local Government Code’s withdrawal of exemptions. For the year 2010. a non-resident alien not engaged in trade or business in the Philippines. D. as agricultural. abandoned imported articles becomes the property of the A. Yes. the exemption has been withdrawn to level the playing field for all taxpayers and preserve the LGUs’ financial position. hence the right to collect the deficiency taxes has prescribed. He returned to the Philippines on November 6. the deficiency taxes may be collected within five years from when they fell due. the local tax assessor discovered Ka Tato’s change of use of his land and informed the local treasurer who demanded payment of deficiency real property taxes from 1990 to 2011. B. . Batangas declared for real property taxation. C. 64. He went on a tour of Southeast Asia from August 1 to November 5. could these cooperatives continue to enjoy such exemption? A. shipping company in case the freight was not paid. bank if the shipment is covered by a letter of credit. Under the Tariff and Customs Code. 2010 and continued to live and engage in business in the Philippines. No. Congress has not by the majority vote of all its members granted exemption to consumers’ cooperatives. B. 63. C.
67. Subsequent adjustment in tax computation and the application of the excess payment to future real property tax liabilities. partly manufactured in the discriminating country but carried by vessels of another country. Enact a new ordinance amending the erroneous or illegal assessment to correct the error. Call the taxpayer to a conference to explain the delay. What should the BIR do when the prescriptive period for the assessment of a tax deficiency is about to prescribe but the taxpayer has not yet complied with the BIR requirements for the production of books of accounts and other records to substantiate the claimed deductions. m. or 180 days from submission of the protest but the BIR Commissioner has . No. and exclusively used the rents for the maintenance of its school buildings. exemptions or credits? A. 68. Money collected from taxation shall not be paid to any religious dignitary EXCEPT when A. Is the leased portion subject to real property tax? A. D. C. D. since the leased portion is not actually. since Lualhati is a stock and for profit educational institution. The school actually. wholly manufactured in the discriminating country but carried by vessels of another country. Yes. No. and exclusively used the rents for educational purposes. B. it is paid by a local government unit. and exclusively used for educational purposes. What should be done in such instance to avoid an injustice? A. directly. The taxpayer seasonably filed his protest together with all the supporting documents. not manufactured in the discriminating country but carried by vessels of such country. D. B. since the school actually. it is part of a lawmaker’s pork barrel.500 sq. Discriminatory duties may NOT be imposed upon articles A. Yes. B. Lualhati Educational Foundation. decided to lease for commercial use a 1. Apparently the law does not provide for the refund of real property taxes that have been collected as a result of an erroneous or illegal assessment by the provincial or city assessor. Immediately conduct an investigation of the taxpayer’s activities.. 69. but it may be subject to income taxation on the rents it receives. B. portion of its school. It is already July 31. C. Pass a new ordinance providing for the refund of real property taxes that have been erroneously or illegally collected. including payment of janitorial services. the religious dignitary is assigned to the Philippine Army. D. Question the legality of the no-refund rule before the Supreme Court. 71. D. not manufactured in the discriminating country and carried by vessels of another country. 2011. C. Inc. B. 70. directly. C. the payment is passed in audit by the COA. Issue a jeopardy assessment coupled with a letter of demand. Issue a notice of constructive distraint to protect government interest. directly.66. a stock educational institution organized for profit. C.
directly. Desirous of an early resolution of his protested assessment. it faithfully issued VAT receipts. m. The rented lot is A. D. New Dynasty contends that it should not be temporarily closed since it has a valid and existing VAT registration. Compensatory purpose of taxation D. 75. and administrative penalties B. as the corporation sole. rented out a 5. the taxpayer deliberately filed a false and fraudulent return with deliberate intention to evade taxes. and filed the proper VAT returns. 2011. and exclusively used for religious purposes. D. including New Dynasty Corporation that failed to comply with VAT regulations. the taxpayer should file his appeal to the Court of Tax Appeals not later than A. C. Civil and criminal penalties C. not exempt from real property taxes since it is the rents. . directly. In “Operation Kandado. Lifeblood doctrine of taxation B. 72. 2011. B. Criminal and administrative penalties 73. August 30. C. Civil and administrative penalties D. exempt from real property taxes since it is actually. Which among the following concepts of taxation is the basis for the situs of income taxation? A.” the BIR temporarily closed business establishments. not the land. the taxpayer used falsified documents to support its application for refund of taxes. Which of the following are NOT usually imposed when there is a tax amnesty? A. August 1. B. C.000 sq. D. that is used for religious purposes. Civil. The head priest of the religious sect Tres Personas Solo Dios. The contention may be rejected if the BIR investigation reveals that A. criminal. there was an understatement of taxable sales or receipts by 30% or more for the taxable quarter. The sect used the rentals for the support and upkeep of its priests. B. August 31. 2011. the taxpayer has not been regularly filing its income tax returns for the past 4 years. and exclusively used for educational purposes. not exempt from real property taxes because the user is organized for profit. Symbiotic relation in taxation C. 2011.not yet decided his protest. Sumptuary purpose of taxation 74. lot registered in its name for use as school site of a school organized for profit. exempt from real property taxes since it is actually. August 15.
but the denial of his pre-emptive right extends only to 500 shares. since under that doctrine. Does he have cause to sue Sentinel Liner? A. since the carrier’s crew did nothing to protect a passenger who remained in the bus during the stop-over. Yes. 3.” Is the note negotiable? A. since the denial of the right under the By-laws is binding on T. No. The answers are bolded. P rode a Sentinel Liner bus going to Baguio from Manila. B. that its By-laws deny T any right of pre-emption.000 new shares divided into Common Shares “B” and Common Shares “C. V. Yes. Yes. in the process. Co. increased its capital stocks from Php10 Million to Php15 Million and. more than the collective value of all lost cargo. because the exercise of the option to pay lies with A. A cargo ship of X Shipping. the door of which was not locked. 1. C. to remain in the bus. since the extent of the ship’s damage was greater than that of the value of the lost cargo. 2.This is Set A of the 2011 Bar Exams on Commercial Law. because an election to require something to be done in lieu of payment of money does not affect negotiability. There are 100 questions in all. ran aground off the coast of Cebu during a storm and lost all its cargo amounting to Php50 Million. A. The company claims. B. the other provisions being merely optional. Yes.No. since the attack on P took place when the bus was at a stop-over. since X Shipping neither incurred a total loss nor abandoned its ship. No. D. ABC Corp. The cargo owners filed a suit against X Shipping but it invoked the doctrine of limited liability since its vessel suffered an Php80 Million damage. the value of the lost cargo and the damage to the ship can be set-off. C. No. since pre-emptive rights are governed by the articles of incorporation. I promise to pay B Php1 Million or his order or give Php1 Million worth of cement or to authorize him to sell my house worth Php1 Million. Is X Shipping correct? A. B. the bus driver. The ship itself suffered damages estimated at Php80 Million. V attacked him. Signed. No. resulting in P suffering from bruises and contusions. Yes. since the carrier’s crew could not have foreseen the attack. however. issued 1. No.since the By-Laws cannot deny a shareholder his right of pre-emption. At this point. No. B. 4. insists on buying the newly issued shares through a right of pre-emption. When P rudely declined. At a stop-over in Tarlac. a stockholder owning 500 shares. and the passengers disembarked for lunch. because it authorizes the sale of collateral securities in case the note is not paid at maturity. however. C. a vendor. It says: “Subject to my option. P decided. B. since each cargo owner has a separate and individual claim for damages. the maker and debtor. since the bus is liable for anything that goes wrong in the course of a trip.” T. the conductor. sneaked into the bus and offered P some refreshments. Yes. Is the corporation correct? A. D. D. D. because the note is really payable to B or his order. No. C. Yes. .Yes. A writes a promissory note in favor of his creditor.
. The latter set up the defense that the agents are in the employ of X Corp. The agents filed a collective suit for illegal dismissal against both X Corp. which prohibits further negotiation and constitutes the indorsee as agent of the indorser.5. M and N since they may be assumed to know of M’s bankruptcy B. That night. C. policies. X Corp. S delivered 10 boxes of cellphones to Trek Bus Liner. M makes a promissory note that states: “I. and N to O. Yes. S since the freightage for the goods had been paid. for transport from Manila to Ilocos Sur on the following day.. which is a separate juridical entity. based on the doctrine of piercing the veil of corporate fiction. a robber broke into the bodega and stole S’s boxes. S since the goods were unconditionally placed with T for transportation. Signed. N. B. B to N. Meanwhile. receive payment of the instrument. 7. and business practices of the other. demand payment of the instrument only. After 2 years. B.00 to B or bearer. the boxes were stored in the bus liner’s bodega. the two companies having the same set of corporate officers. the real employer is Y Corp. B. D. S sues Trek Bus Liner for contractual breach but the latter argues that S has no cause of action based on such breach since the loss occurred while the goods awaited transport. and Y Corp. however. and N. since the doctrine would apply. M. M. The bus liner since the loss was due to a fortuitous event. instruct that payment be made to the drawee. C.” M negotiated the note by delivery to B. to A. As agent. being O’s immediate negotiator of a bearer note C. having known of M’s bankruptcy 6. 8. Who is correct? A. Who would be liable to O? A. the indorsee has the right. dismissed its call agents for no apparent reason. No. Is this defense appropriate? A. the pizza company. with X Corp. C. A negotiable instrument can be indorsed by way of a restrictive indorsement. B. for which S paid the freightage. M. which operates a chain of pizza restaurants. notify the drawer of the payment of the instrument. among others. operates a call center that received orders for pizzas on behalf of Y Corp. X Corp. B. since the two companies perform two distinct businesses. serving as an arm for receiving its outside orders for pizzas. D. Yes. No. being indorsers by delivery of a bearer note D. The two companies have the same set of corporate officers. B had known that M was bankrupt when M issued the note. The bus liner since the goods were not lost while being transported. promise to pay Php5. D.000. it is not shown that one company completely dominates the finances.
If X has no defense at all against Y. D. to whom Y owed Php30. examining the agent’s special power of attorney. accepted. for how much may Z collect from X? A. 10. The liability of a common carrier for the goods it transports begins from the time of A. if the holder has a lien on the instrument which arises either from a contract or by implication of law. 2011 without republication of notice. B. Php20. the latter foreclosed the Real Estate Mortgage he executed in its favor.00. his predecessor’s interest.000.000. 13. a person who takes a bill that is drawn. the lien in his favor. examining the bill to determine the extent of such authority. C. he would be a holder for value to the extent of A. 11. conditional receipt.000. Php50. constructive receipt.00 for Y’s benefit.000. 1. B. the amount indicated on the instrument’s face. B.000.000. a signature by procuration operates as a notice that the agent has but a limited authority to sign. 2010 was declared a holiday and re-scheduled to Jan. Y indorsed the note to Z. Thus. 12. asking the agent about the extent of such authority. Under the Negotiable Instruments Law. 10. None. D. Y. 2010 with the notices of sale published as the law required. actual receipt. payable to the order of Y. as he is a holder for value to the extent of his lien. D. X executed a promissory note with a face value of Php50. his successor’s interest. D. On X’s failure to pay his loan to ABC Bank. Php30. The sale was. asking the principal about the extent of such authority. cancelled when Dec. Under the circumstances. .00. voidable. C. void. The auction sale was set for Dec. C. Under the Negotiable Instruments Law.00. unenforceable.00. C. but with the obligation to hold Php20. the auction sale is A. rescissible. however. as he is a holder for value to the extent of the difference between Y’s debt and the value of the note. either actual or constructive receipt. 1.00.9. B. as Z’s remedy is to run after his debtor. D. or indorsed by procuration is duty-bound to inquire into the extent of the agent’s authority by: A. The auction sale then proceeded on the new date. B. C.
the common carrier is liable for the injury or death of a passenger resulting from its employee’s fault although the latter acted beyond the scope of his authority. market value. As to unpaid subscriptions to its shares of stock.14. rule in culpa aquiliana. the covered institution. since X. they should be included in the A. par value. duress amounting to forgery. and X to Y. A holder in due course holds the instrument free from any defect of title of prior parties and free from defenses available to prior parties among themselves. D. 15. P sold to M 10 grams of shabu worth Php5. 16. being a subsequent indorser. book value. Y then sued X on the note. No. . P then indorsed the note to X (who did not know about the shabu). since a void contract does not give rise to any right. since the note was born of an illegal consideration which is a real defense. since X. fraud in esse contractus. D. rule that the carrier has an express duty to transport the passenger safely C.000. X set up the defense of illegality of consideration. rule that the carrier has an implied duty to transport the passenger safely. It is settled that neither par value nor book value is an accurate indicator of the fair value of a share of stock of a corporation. Doctrine of Respondeat Superior. C. warrants that the note is valid and subsisting. D. B. a general indorser.000. D. a covered institution is required to maintain a system of verifying the true identity of their clients as well as persons purporting to act on behalf of A. warrants that the note is valid and subsisting. B. In a contract of carriage. As he had no money at the time of the sale. C. fraud in inducement. Is he correct? A. 17. such clients. B. Under the Anti-Money Laundering Law. C. No. those doing business with such clients.00. unknown principals. Yes. D. C. An example of such a defense is A. Yes. B. alteration. M wrote a promissory note promising to pay P or his order Php5. as they are regarded as corporate assets. This is based on the A. 18. B. Unable to collect from P. capital value.
and thus not due to a peril of the sea. The insurance policies stated that the insurer shall answer for all damages due to perils of the sea. a partnership. regardless of any depreciation or appreciation in the share’s fair value. May Z insure the lives of both X and Y with Z as beneficiary? A. only if there is no appreciation or depreciation in the share’s fair value. 21. B. regardless of any depreciation in the share’s fair value. as they are your partners. regardless of any appreciation in the share’s fair value. Yes. since Z has no pecuniary interest in the lives of X and Y arising from their employment with him. as he is an industrial partner. This is true A. C. One of the insured’s ship.19. as there is merely a partnership contract among A. B. Only C. B and C. B. D. D. Yes. C. since X and Y have no pecuniary interest on the life of Z arising from their employment with him. If you were partner A. as he is a capitalist partner. because the insurance policy covered any or all damage arising from perils of the sea. since the proximate cause of the damage was the breach of warranty of seaworthiness of the ship. This is true A. such that you may then insure him? A. . 23. D. D. Co. unless otherwise provided in the Articles of Incorporation or in the By-laws. in every case even if the Board of Trustees resolves otherwise. In elections for the Board of Trustees of non-stock corporations. Y. Co. insured all of its vessels with R Insurance. Yes. T Shipping. who between B and C would you have an insurable interest on. 20. B. Yes. since there appears to have been no fault on the part of the shipowner and shipcaptain. Both B and C. is composed of A (capitalist partner). C. unless set aside by the members in plenary session. the MV Dona Priscilla. ran aground in the Panama Canal when its engine pipes leaked and the oil seeped into the cargo compartment. has also been Z’s long-time driver. B (capitalist partner) and C (industrial partner). in every case even if the majority of the members decide otherwise during the elections. since X and Y render services to Z. The leakage was caused by the extensive mileage that the ship had accumulated. D. since the proximate cause of the damage was due to ordinary usage of the ship. members may cast as many votes as there are trustees to be elected but may not cast more than one vote for one candidate. No. C. No. Co. C. Only B. No one. 22. May the insurer be made to answer for the damage to the cargo and the ship? A. B. since X and Y are Z’s employees. X.. X has been a long-time household helper of Z. X’s husband. No. The rule is that the valuation of the shares of a stockholder who exercises his appraisal rights is determined as of the day prior to the date on which the vote was taken. No.
the instrument being a bill of exchange. Will it prosper? A. because X. because the acceptance is in reality a clear assent to the order of the drawer to pay. because T relied merely on his supposed gift of prophecy. Yes. Yes. The reason for this is that the test of concealment of material fact is determined A. X then indorsed it as follows: “Subject to no recourse. Signed. 27. No. D. at any time before the policy becomes effective. because no reasonable ground for avoiding a peril existed at the time of the deviation. it turned out that Y’s signature was forged. notice of dishonor is at all times required. T. . drawee of a bill of exchange. F wants to recover from U but the latter insists that a notice of dishonor must first be made.” When Z went to collect from Y. because X. pay to Z. because X made a qualified indorsement. dreamt of an Intensity 8 earthquake along the path of his ship. D. since T can waive the requirement of notice of dishonor. X. Yes. he immediately ordered the ship to return to port. C. B. at the time of the payment of the premium. B. as a qualified indorser. while asleep in his cabin. Yes. warrants that the note is genuine. B. because the acceptance must be a clear assent to the order of the drawer to pay. C. 25. 26. Yes. Yes. because the deviation was made in good faith and on a reasonable ground for believing that it was necessary to avoid a peril. No. at the time of the issuance of the policy. warrants that the note is genuine. Is the acceptance valid? A. No. X. Yes. because the document must not express that the drawee will perform his promise within two days. F learned that T is only 15 years old. Signed. U as drawer. Was the deviation proper? A. B. at any time before the payment of premium. A bill of exchange has T for its drawee. because the deviation took place based on a reasonable belief of the captain.24. is not obliged to divulge it. with Y as maker. When F went to T for presentment. as a conditional indorser. C. No. D. No. because the form of the acceptance is really immaterial. No. since F can treat U as maker due to the minority of T. because a qualified indorsement does not include the warranty of genuineness. wrote the words: “Accepted. On waking up. the captain of MV Don Alan. Yes. Z now sues X for collection. with promise to make payment within two days. since in a bill of exchange. True enough. C. An insured. No. since a notice of dishonor is essential to charging the drawer. 28. No. C. X. D. who gains knowledge of a material fact already after the effectivity of the insurance policy. and F as holder. the drawee. B. D.” The drawer questioned the acceptance as invalid. the earthquake and tsunami struck three days later and his ship was saved. Is he correct? A. X is the holder of an instrument payable to him (X) or his order.
Yes. N indorsed it to E. D. then negotiated it to N after forging C’s signature. B. B borrowed Php1 million from L and offered to him his BMW car worth Php1 Million as collateral. Yes.” Is this note negotiable? A. since the signature of C. Yes. Yes. B. C. No. B then executed a promissory note that reads: “I. since the promise to just pay a sum of money is unclear. A material alteration of an instrument without the assent of all parties liable thereon results in its avoidance. misrepresenting himself as C’s agent. since the signature of C is immaterial. since only the forged signature is inoperative and E is bound as indorser. because it did not entail any application of X’s intellect. No. D. B. promise to pay L or bearer the amount of Php1 Million and to keep my BMW car (loan collateral) free from any other encumbrance. which he dubbed as the “iTel” and which uses lesser time for locating names and telephone numbers. . 30.00 loan. No. because it entailed the application of X’s intellect. No. because it is an original creation. a holder in due course. B. D. D. prior indorsee. C’s brother. No. D.000. wrote a promissory note payable to the order of C. Signed. Yes. B. subsequent acceptor. since it is payable to bearer. was forged. No. because it is a mere system or method. since the forgery of C’s signature results in the discharge of E. the payee. D. since it contains an unconditional promise to pay a sum certain in money. 32. since it contains a promise to do an act in addition to the payment of money. May F recover from E? A. C. subsequent indorser. M. he being the payee. B. unqualified free disposal of his car. X came up with a new way of presenting a telephone directory in a mobile phone. X constituted a chattel mortgage on a car (valued at Php1 Million pesos) to secure a P500. May X have his “iTel” copyrighted in his name? A. the right to mortgage the car to the extent of half its value. 31. B. who indorsed it to F. 33. ownership of the car. EXCEPT against a A. registered the car in his name. Yes. X should have A. prior acceptor. obtained the note from D. C. C.29. C. debtor of C. For the mortgage to be valid.
P asked O to pay. T also requested the firm’s messenger to deliver the letter to the publisher. D. Signed. as indorser to O C. T used the law firm’s letterhead and its computer in preparing the letter. Inc. the holder may present the instrument for payment without need of a previous presentment for acceptance. E moved to dismiss on the ground that his liability is only civil. E was to turn over to T the proceeds of any sale and return the ones unsold. X. inevitable losses C. Y and Z. a non-profit organization. promissory note. 37.” The drawee named in the bill is E. probable losses B. wrote a newspaper publisher a letter disputing a columnist’s claim about an incident in the attorney’s family. D. B. being the payee B. he was charged in court for estafa. As to each of the three. Who owns the copyright to the letter? A. its depositors or creditors would incur A.. E. EFG Foundation. if allowed to continue in business. B. From whom may O recover? A.T. which O did. If the drawer and the drawee are the same person. the holder treats it as a A. N to O.00. since he is the original creator of the contents of the letter. Is he correct? . pay to B or his order Php100. and O to P. being the drawer 38.000. an associate attorney in XYZ Law Office. Due to non-acceptance and after proceedings for dishonor were made. Both T and the publisher. being the drawee D. D draws a bill of exchange that states: “One month from date.6 B. a slight chance of losses 35. check. A bank can be placed under receivership when. The law office since T was an employee and he wrote it on the firm’s letterhead. wish to exercise cumulative voting in order to protect their interest. although the Foundation’s Articles and Bylaws are silent on the matter. possible losses D. non-negotiable instrument. 39. T. who are minority members of the foundation. 3 36. E executed a trust receipt in T’s favor covering the goods. B negotiated the bill to M. D. letter of credit. To document their agreement. C.34. one wrote the letter to the other who has possession of it. In such a case. scheduled an election for its six-member Board of Trustees. B. E received goods from T for display and sale in E’s store. N. C. The publisher to whom the letter was sent. 12 D. When E failed to turn over the proceeds from his sale of the goods or return the ones unsold despite demand. D. 9 C. what is the maximum number of votes that he/she can cast? A. M to N.
On June 1. He died a day later. No. since his breach of the trust receipt agreement subjects him to both civil and criminal liability for estafa. in its original tenor if the alteration is material. C. principal debtor. 41. secondary debtor. shipper. 2011. 2011. C. the insurance company accepted the application and mailed. Yes. The authorized alteration of a warehouse receipt which does not change its tenor renders the warehouseman liable according to the terms of the receipt A. X. C. since E cannot be charged with estafa over goods covered a trust receipt. void. The message stated also that if Y does not settle the warehouse charges within 10 days. on August 4. entrustor. This agreement refers to one which the holder made with the A. May X’s heirs recover on the insurance policy? . notifying him of the due date and time to settle the storage fees. No. X figured in a car accident. Any agreement binding upon the holder to extend the time of payment or to postpone the holder’s right to enforce the instrument results in the discharge of the party secondarily liable unless made with the latter’s consent. in its original tenor. B. since it was merely a consignment sale and the buyer could not pay. B. since he committed fraud when he promised to pay for the goods and did not. D. It reached X’s residence on August 11. D. C. X sold 100 sacks of corn at a public auction. the sale of the 100 sacks of corn is A. its acceptance plus the cover note. with payment for 5 years of premium enclosed in it. rescissible. B. entrustee. On July 21. is called the A. he will advertise the goods for sale at a public auction. B. as it happened. C. principal creditor. as altered if there is fraud. unenforceable. 44. 42. B. Co. to whom X had issued a warehouse receipt for Y’s 500 sacks of corn. voidable. Upon execution of a trust receipt over goods. D. When Y ignored the demand. 2011.A. as altered. warehouseman. sent a text message to Y. 43. D. his application for life insurance. secondary creditor. For X’s failure to comply with the statutory requirement of written notice to satisfy his lien. But. on the same day. Yes. the party who is obliged to release such goods and who retains security interest on those goods. holder. X mailed to Y Insurance. 2011. D. 40.
Yes. C. since D is the principal debtor. Is E freed from liability? A. M then negotiated the note to N after forging the signature of C. T Corp. not to shortening. misrepresenting himself as agent of C. Yes. Yes. C. Yes. 2000. Yes. 2015. D. . B. has a corporate term of 20 years under its Articles of Incorporation or from June 1. 48. obtained the note from D. I. while drunk. D. D. however. No. since it is C who can enforce it. resulting in serious physical injuries to the passengers. D is a fictitious person. since under the Manifestation Theory. C. No. as maker. which is June 1. B. the insurance contract was perfected upon acceptance by the insurer of X’s application. the current holder presented the bill to E for acceptance. Yes. Is this SEC disapproval correct? A. C. A.A. 46. the note being payable to the order of C. T Corp decided to shorten its term by 1 year or until June 1. B. but A raised the defense of having exercised extraordinary diligence in the safety of the passenger. 2014. Yes. The SEC. E warrants that he is solvent. accepted a passenger in his taxicab. 1980 to June 1. B then drove the taxi recklessly. E accepted but. The latter then filed a suit for tort against B’s operator. E admits the existence of the drawer. as a common carrier can rebut the presumption of negligence by raising such a defense. as it later turned out. since the 5-year rule on amendment of corporate term applies only to extension. since there is no privity of contract between the insurer and X’s heirs. No. B. is primarily liable on the note. since X had no knowledge of the insurer’s acceptance of his application before he died. E as drawee and F as payee. the amendment to shorten corporate term cannot be made earlier than 5 years prior to the corporation’s expiration date. On June 1. The bill was then indorsed to G. 1980 to June 1. of term. May N enforce the note against D? A. if E was not aware of that fact at the time of acceptance. the insurance contract was perfected upon acceptance of the insurer of X’s application. and H to I. since D. since a corporation can in fact have a corporate life of 50 years. since a bill of exchange with a fictitious drawer is void and inexistent. since under the Cognition Theory. G to H. it crashed into an electric post. No. Is his defense tenable? A. disapproved the 2011 amendment on the ground that it cannot be made earlier than 5 years prior to the expiration date of the corporate term. however. No. No. The SEC approved this amendment. On June 1. Yes. No. since by accepting. any amendment affecting corporate term cannot be made earlier than 5 years prior to the corporation’s expiration date. No. Both the 1991 and 2011 amendments were approved by majority vote of its Board of Directors and ratified in a special meeting by its stockholders representing at least 2/3 of its outstanding capital stock. Due to his debt to C. 2014. D. since by accepting. 47. C’s brother. B. 1991 it amended its Articles of Incorporation to extend its life by 15 years from June 1. since the signature of C was forged. D wrote a promissory note which is payable to the order of C. 45. A bill of exchange has D as drawer. and inevitably. 2011. Yes. M.
On April 11. D. subject to stockholders’ ratification. 49. . was obviously negligent due to his intoxication. Php12 Million since he warrants that the note is genuine and in all respects what it purports to be. Is he right and. C. if so. B. Yes. 2011. Php1 Million since it is the original tenor of the note. it is an ultra vires act of the corporation itself and. invested its funds in Y Corp. 2010. 52. must be made to account for all his actions. it is an ultra vires act of the corporation itself but voidable only. what is the status of the investment? A. the maker. Yes. 1. issued a promissory note to P. it is an ultra vires act of its Board of Directors and thus void. The investment grew tremendously on account of Y Corp.B. 21.. D. 50. Yes. The rationale here is that the indorser A. 2011. But before O indorsed the note to Q. For how much is O liable to Q? A. is bound to make the acceptance in all cases. making it appear that the note is for Php12 Million. void. C. Notice of dishonor is not required to be made in all cases. B. B. Php12 Million since he warrants his solvency and that he has a good title to the note. M. But a minority stockholder in X Corp. S was then elected in his place. 2011. D. 2010. X Corp. C. again by indorsement. as in tort actions.” P negotiated the note by indorsement to N. D.. One instance where such notice is not necessary is when the indorser is the one to whom the instrument is suppose to be presented for payment. On Nov. C. who was elected to a 1-year term on Feb. C. B. No. April 11. the payee which states: “I. subject to stockholders’ ratification. the proper defense is due diligence in the selection and supervision of the employee by the employer. as a common carrier can invoke extraordinary diligence in the safety of passengers in tort cases. consequently. M. X is a director in T Corp. M. O’s wife wrote the figure “2” on the note after “Php1” without O’s knowledge. 1. 2011. an investment firm. assails the investment as ultra vires. and O to Q. who assumed as director on May 17. 21. Feb. through a resolution of its Board of Directors. Nov. X resigned and was replaced by R. then N to O also by indorsement. promise to pay P or order the amount of Php1 Million. already knows of the dishonor and it makes no sense to notify him of it. 2010. Yes. Until which time should S serve as director? A. No. as B. it is an ultra vires act of its Board of Directors but voidable only. May 17. Php1 Million since he warrants that the note is genuine and in all respects what it purports to be.’s excellent business judgment. 2010. Yes. 51. has no reason to expect the dishonor of the instrument. the common carrier’s employee. R died. D. Signed. whose business purpose is to manufacture and sell vehicles.
56. or embodied in a work. since the stockholder himself should sit in the three-member group. presented a lecture on his findings before the Association of Astronomers of the Philippines. Will the opposition prosper? A. actual.. without notes. exceeds 25% of the outstanding capital stock. if any? A.” a firm that sells water to the public. D. No. Yes. B. C. May the wife of the withdrawing stockholder be named to the three. Yes. the wife of the withdrawing shareholder is not a disinterested person. since the root word “Eagle” is a generic name not subject to registration. For a constructive total loss to exist in marine insurance.member group? A. B. since the companies are not engaged in the same line of business. No. D. it is required that the person insured relinquish his interest in the thing insured. It is nominal if his interest: A. a professional astronomer. The Corporation Code sanctions a contract between two or more corporations which have interlocking directors. explained. does not exceed 20% of the outstanding capital stock. even if expressed. B. No. D. repeating exactly what X discovered without any attribution to him. since both companies use water in conducting their business. since she could best protect her husband’s shareholdings. In case of disagreement between the corporation and a withdrawing stockholder who exercises his appraisal right regarding the fair value of his shares. he later read an article in a science journal written by Y. 57. D. Yes. This relinquishment must be A. “Eagleson Refillers. Co. No. No. illustrated. Yes. Co. C.. since X did not reduce his lecture in writing or other material form. 55. Yes. Yes. since such use is likely to deceive or confuse the public. X. an amateur astronomer. constructive. provided there is no fraud that attends it and it is fair and reasonable under the circumstances. stumbled upon what appeared to be a massive volcanic eruption in Jupiter while peering at the planet through his telescope. since Y’s article failed to make any attribution to X. then actual. No.” on the ground that such trade name tends to deceive trade circles or confuse the public with respect to the water firm’s registered trade name. The following week. constructive first and if it fails. To his dismay. C. does not exceed 25% of the outstanding capital stock. a three-member group shall by majority vote resolve the issue with finality. B. 54. opposes the trade name application of “Eagleson Laundry. C. .53. The interest of an interlocking director in one corporation may be either substantial or nominal. X. since the lecture is considered X’s original work. Has Y infringed on X’s copyright. B. C. since no protection extends to any discovery. since the rules do not discriminate against wives. exceeds 20% of the outstanding capital stock. either actual or constructive. D.
No. and 4) it is valid and subsisting at the time of his indorsement? A. C. invented a similar device which he used in his cellphone business in Manila. since Y unwittingly used X’s patented invention. through the use of noise. D. X invented a device which. C. to 5 p. such insurer can run after the third person who caused the loss through subrogation. since X is the first to register his device for patent registration. 3) all prior parties have capacity to negotiate. The irregular indorser. The insured’s endorsement of its claim to the insurer. Can P sue the MRT for contractual breach as she was within the MRT premises where she would shortly take her ride home? A.m. Yes. during the author’s lifetime. a sales girl in a flower shop at the Ayala Station of the Metro Rail Transit (MRT) bought two tokens or tickets. Apart from economic rights. 60. She got to her flower shop where she usually worked from 8 a. effective within the Philippines. Which of the following indorsers expressly warrants in negotiating an instrument that 1) it is genuine and true. B. since she already had a ticket for her ride home and was in the MRTs premises at the time of the incident. He applied for and was granted a patent on his device. No. but at the MRT station. . B. D. The term of these moral rights shall last A. causing injuries to P in the process. forever. two crews of the MRT got into a fight near the flower shop. a year before the grant of X’s patent.m.58. since P had no intention to board an MRT train coach when the incident occured. C. No. also an inventor. But X files an injunctive suit against Y to stop him from using the device on the ground of patent infringement. Where the insurer was made to pay the insured for a loss covered by the insurance contract. Will the suit prosper? A. 50 years from the time the author created his work. D. B. D. At about 3 p. B. The equitable assignment that results from the insurer’s payment of the insured. No. Yes. Yes. 59. The regular indorser. 61. D. 2) he has a good title to it. the author of a copyright also has moral rights which he may transfer by way of assignment. C. since the incident took place.. C. P. Y. can recharge a cellphone battery. since Y is a prior user in good faith. B. while P was attending to her duties at the flower shop. Yes.m. not in an MRT train coach. Their express stipulation in the contract of insurance. As it turns out. since the correct remedy for X is a civil action for damages. The qualified indorser. 62. one for her ride to work and another for her ride home. during the author’s lifetime and for 50 years after his death. The insured’s formal assignment of his right to indemnification to the insurer. What is the basis for conferring the right of subrogation to the insurer? A. The general indorser. since she bought a round trip ticket and MRT had a duty while she was at its station to keep her safe for her return trip.
without acceptance but the bill is paid by the drawee. 68. 64. X found a check on the street. Will it prosper? A. if with the permission of the Bangko Sentral ng Pilipinas. executed a Real Estate Mortgage (REM) on his (X’s) land to secure Y’s loan from Z. D. without acceptance but the bill is paid by the drawer. in turn. The rule is that no stock dividend shall be issued without the approval of stockholders representing at least 2/3 of the outstanding capital stock at a regular or special meeting called for the purpose. B. B. Yes. with Z as payee. 66. a violation by the insured A. As to other forms of dividends: A. at Y’s request. with acceptance but the bill is paid by the drawer. a mere majority of the entire Board of Directors applies. with acceptance but the bill is paid by the drawee. its client. B. C. No. C. Z successfully foreclosed the REM when Y defaulted on the loan but half of Y’s obligation remained unpaid. the same rule of 2/3 votes applies. May Z sue X to enforce his right to the deficiency? A. May a publicly listed universal bank own 100% of the voting stocks in another universal bank and in a commercial bank? A. because X is not Z’s debtor. C. but solidarily with Y. 67. a mere majority of the votes of stockholders representing the outstanding capital stock applies. offsets the value of the policy with the additional insurances’s value. indorsed it to ABC Bank which charged it to the Y’s account. X. C. since it is the buyer at the auction sale who should answer for the deficiency. X. since the payee’s signature has been forged.63. since X’s is deemed to warrant that his land would cover the whole obligation. Yes. D. since Y’s remedy is to run after the forger. Forgery of bills of exchange may be subdivided into. 65. drawn by Y against ABC Bank. Yes. a) forgery of an indorsement on the bill and b) forgery of the drawer’s signature. or A. D. No. B. If an insurance policy prohibits additional insurance on the property insured without the insurer’s consent. since ABC Bank is bound to know the signature of Y. . The latter. forfeits premiums already paid. Yes. such provision being valid and reasonable. Yes. D. Yes. reduces the value of the policy. since forgery is only a personal defense. which may either be with acceptance by the drawee. C. Y later sued ABC Bank but it set up the forgery as its defense. No. avoids the policy. B. No. B. X forged Z’s signature as an indorser. C. D. No. since it has no power to invest in equities. then indorsed it personally and delivered it to DEF Bank. as there is no prohibition on it. a mere majority of the quorum of the Board of Directors applies.
X. limited to the case where the indorsement is not necessary to his title. Yes from both of them. C. Under the Intellectual Property Code. 71. he no longer answered a question regarding it in the application form. lectures. D. B. original works. unnatural and ordinary actions of the sea. 69. limited to the case where the indorsement is necessary to his title. A month later. 73. without limitation. With respect to an indorser. 70. D. Yes. since the previous hospitalization would influence the insurer in deciding whether to grant X’s application. derivative works. B. B. since the previous illness is not a material fact to the insurance coverage. Would this constitute concealment? A. X told Y the reason for his hospitalization. No. C. D. the 100% ownership on voting stocks must be in either bank only. D. Co. non-original works. are regarded as A. B. not subject to protection.. under marine insurance law. Yes but only from the drawer. D. B. he cannot recover from either of them. No. X applied for an insurance covering serious illnesses from ABC Insurance. sermons. C. . whether or not reduced in writing or other material forms. was about to be discharged when he met his friend Y. natural and ordinary actions of the sea. unnatural and inevitable actions of the sea. Perils of the ship. natural and inevitable actions of the sea. Yes but only from the holder. not limited to the case where the indorsement is necessary to his title. 72. since under the law. Can a drawee who accepts a materially altered check recover from the holder and the drawer? A. it would constitute concealment that amounts to misrepresentation on X’s part.D. No. where Y was working as Corporate Secretary. C. addresses or dissertations prepared for oral delivery. The rule is that the intentional cancellation of a person secondarily liable results in the discharge of the latter. refer to loss which in the ordinary course of events results from A. Since X had already told Y about his hospitalization. the holder’s right to cancel his signature is: A. Yes. since Y may be regarded as ABC’s agent and he already knew of X’s previous hospitalization. in the hospital for kidney dysfunction. C. No.
Is B correct? A. X. the government filed tax evasion charges against all the company’s members of the board of directors. which he then used for his “CROCOS” burgers. being mere directors of a fictional being. since as an indorser who is secondarily liable. 0% C.” Y then indorsed the note to Z. since unlike T. The Board of Directors of XYZ Corp. Yes. since as a rule only natural persons like the members of the board of directors can commit corporate crimes. No. No. Is Y correct? A. 40% B. It says: “Pay to Y or order the amount of Php50. since the directors officially and collectively performed acts that are imputable only to the corporation. B. Signed. since the secondary liability of Y and Z would only arise after presentment for payment and dishonor by the maker. C. Yes. he did not register his own “CROCOS” mark for his product. Several American doctors wanted to set up a group clinic in the Philippines so they could render modern medical services. No. what is the required foreign equity participation in such a corporation? A.No.since the owner of a well-known mark registered in the Philippines has rights that extends even to dissimilar kinds of goods. as B was in bad faith in coming up with his own “CROCOS” mark. there is no infringement. Are they correct? A. When T sought collection from Y. 60% D. Yes. since it is the corporation that did not pay the tax and it has a personality distinct from its directors. C. No. B. since the right of the owner of a well-known mark registered in the Philippines does not extend to goods which are not of the same kind. If the clinic is to be incorporated under our laws.00. . and Z to T. Yes. X executed a promissory note in favor of Y by way of accommodation. 70% 75. D. B came up with his own “CROCOS” mark. since the law makes directors of the corporation solidarily liable for gross negligence and bad faith in the discharge of their duties. the latter countered as indorser that there should have been a presentment first to the maker who dishonors it. On discovering this.74. C. No. there must first be presentment for payment and dishonor by the maker. The directors invoked the defense that they have no personal liability. unanimously passed a Resolution approving the taking of steps that in reality amounted to willful tax evasion. T is the registered trademark owner of “CROCOS” which he uses on his ready-to-wear clothes. hence. 76. T now sues B for trademark infringement but B argues that his product is a burger. 77. Yes. D. D.000. since the absolute rule is that there is no need for presentment for payment and dishonor to hold an indorser liable. Banking on the popularity of T’s trade mark. B. there is no need for presentment for payment and dishonor by the maker. since Y is the real debtor and thus. Yes.
not less than P25. it would be deceptive since he is a proprietor. D. since his line of business is public transportation. T delivers two refrigerators to the warehouse of W who then issues a negotiable receipt undertaking the delivery of the refrigerators to “T or bearer. since he is a purchaser in good faith and for value. C. A. D. 81. C. not more than P5.00. Yes. since FIMA’s paid up capital more than meets the country’s nationalization laws. the proprietor of a fleet of ten taxicabs.00. not a corporation. 82. since there is substantial compliance with our nationalization laws respecting paid-up capital and Filipino dominated Board of Directors.” with a group of Filipino businessmen. The Articles of Incorporation must be accompanied by a Treasurer’s Affidavit certifying under oath. No. C.000. B negotiated it. B. 80. they agreed to organize “FIMA Insurance Corp. No.00. D. Is this amendment valid? A. Yes. among others. A group of Malaysians wanted to invest in the Philippines’ insurance business. D. By majority vote. that the total subscription paid is: A. C. since an insurance company should be 100% owned by Filipinos. because the voting in the Board should have been by majority of a quorum. Yes since the majority votes in the Board was sufficient to amend the By-laws. Who is entitled to the delivery of the refrigerators? A. however. since such name would give his business a corporate identity. W. since an insurance company must have at least PhP75 Million paid-up capital. not more than P25.00. the Board then approved the amendment.000. B. Co. No. .000.. B.78.” May this be allowed? A. After negotiations. “A Transport Co.000. T. D. All corporate officers would be Filipinos and 8 out of its 10-member Board of Directors would be Filipinos. Yes. authorized the company’s Board of Directors to amend its By-laws. since T entrusted the receipt to him. since he has as a warehouseman a lien on the goods. No. since “A” is a generic name. Inc. B. as his business name. not less than P5. In a special meeting called for the purpose. FIMA would have a PhP50 Million paid up capital. F. since he is the real owner of the refrigerators. No since the stockholders cannot delegate their right to amend the By-laws to the Board. B. No. PhP40 Million of which would come from the Filipino group. Yes.” T entrusted the receipt to B for safekeeping only. 2/3 of the stockholders representing the outstanding capital stock in X. decides to adopt. C. 79. not suitable for registration. Can FIMA operate an insurance business in the Philippines? A. Yes since the votes of 2/3 of the stockholders and majority of the Board were secured. B. to F who bought it in good faith and for value.
A month before the levy. No.” Is the note negotiable? A. because the drawer and drawee are one and the same person. No. M then issued a promissory note to P promising to pay the money within 90 days. 84. X. B. on its face: “I. Signed. The bill reads: “Pay to B or order the sum of Php1 million. since it is payable at a fixed period after the occurrence of a specified event. Yes.000. mandatory. being a purchaser for value of the warehouse receipt C. promise to pay Y the amount of Php 5. creditor of Y. absolute. T. Who has a better right over the goods? A. The exercise of this power is A. A promissory note states. B. P authorized A to sign a bill of exchange in his (P’s) name. X. supervisory. . being the owner of the goods 85. Yes. Y. Yes. Yes. Unknown to P and M. since it is payable at a fixed period after the occurrence of an event which may not happen. because the instrument is payable to order and has been indorsed several times.” The bill was drawn on P. The court’s sheriff then levied on the goods that Y stored in T’s warehouse. X. D. C. obtained a judgment in his favor in connection with Y’s unpaid loan to him. Yes. No. D. may he enforce payment on it? A. B indorsed the bill to C. since he is a holder in due course and P and M were not aware of the law that prohibited the sale of gecko. X.000. D. being the warehouseman with a lien on the goods B. No. C. being Y’s judgment creditor D. for which the latter issued a warehouse receipt. A (for and in behalf of P). C to D. and D to E. No. since the law declared void the contract on which the promissory note was founded. Signed.00 five days after completion of the on-going construction of my house. Yes. 87. Under the Public Service Act. B. an administrative agency has the power to approve provisionally the rates of public utilities without a hearing in case of urgent public needs. because the instrument is a bill of exchange. since it should be payable at a fixed period before the occurrence of a specified event. since it was not X who bought the gecko. 86. B. C. May E treat the bill as a promissory note? A. because A was only an agent of P. C. P sold to M a pair of gecko (tuko) for Php50. Z. since he is a holder in due course of a note which is distinct from the sale of gecko.00. discretionary. a law was passed a month before the sale that prohibits and declares void any agreement to sell gecko in the country.83. however. since it is payable at a fixed period or determinable future time. Z bought the warehouse receipt for value. D. If X acquired the note in good faith and for value. No.
. since T. insured its vessel MV Don Teodoro for Php100 Million with ABC Insurance. a former Congressman. Z. can also give notice of abandonment for his principal. a government-owned and controlled corporation. C. Is ABC Insurance right? A. since Z is not a party to the loan between X and Y. P. G invokes his right to stop the goods in transit due to his unpaid lien. C. No. Co. since X owed Y Php1 Million. from continuing to sit as one of its members. sold 100 sacks of rice to H who promised to pay once he has sold all the rice. since the provisions of the Corporation Code applies as well to government-owned and controlled corporations. an agent of X Shipping. 89. regardless of whether or not he is a purchaser for value and in good faith. since the new law cannot be applied to members of the board of directors already elected prior to its passage. X Shipping. Without the knowledge of G and W. disqualified C. however. Signed. No. Y. D. T personally informed ABC Insurance that X Shipping was abandoning the ship. since the disqualification takes effect by operation of law. insisting that under the Corporation Code members of the board of directors of corporations may only be removed by vote of stockholders holding 2/3 of its outstanding capital stock in a regular or special meeting called for that purpose. Co. Is C correct? A. G. since X Shipping should have ratified its agent’s action. Z wrote out an instrument that states: “Pay to X the amount of Php1 Million for collection only. since the indorsement to Y is for Php1 Million. May he validly do so? A. A law was passed disqualifying former members of Congress from sitting in the Board of Directors of government-owned or controlled corporations. since as an unpaid seller. P. the Board of Directors of ABC Corp. W. Yes. B. through T. No. Yes. the vessel accidentally caught fire and suffered damages estimated at Php80 Million.” X indorsed it to his creditor. B. B. Yes. Later. Y now wants to collect and satisfy X’s debt through the Php1 million on the check. who issued a warehouse receipt. C. No.88. since X is merely an agent of Z. as agent of X Shipping who procured the insurance. B. Who has a better right to the rice? A. who released them. During a voyage. the damage was more than ¾ of the ship’s value. he has the right of stoppage in transitu. since the board has the power to oust him even without the new law. Yes. D. P then claimed the goods from W. D. his only right being to collect. 90. G. since only the agent of X Shipping relayed the fact of abandonment. it is sufficient that he was declared no longer a member of the board. to whom he owed Php1 million. After the rice was loaded on a ship bound for Manila. Because of this.. . 91. ABC insurance denied X Shipping’s claim for loss on the ground that a notice of abandonment through its agent was improper. No. since he has superior rights as a purchaser for value and in good faith. since it appears that the warehouse charges have not been paid. C. a grocery goods supplier. a warehouseman. D. since in the first place. H meantime delivered the goods to W. Yes. No. H negotiated the receipt to P who acquired it in good faith and for value. Yes. C objected.
Yes. Yes. C. May the indorsee of a promissory note indorsed to him “for deposit” file a suit against the indorser? A. D. as long as the indorser received value for the restrictive indorsement. which varies the command in the bill of exchange? A. accepted the bill upon presentment by writing on it the words “I shall pay Php30. since a drawee accepts according to the tenor of his acceptance. Mr. C. In return for the 20 years of faithful service of X as a househelper to Y. Is this an insurance contract? A. C. the principal is bound only in case the agent acted within the actual limits of his authority. No. chargeable to the account of Mr.00. Y. since it is in fact an innominate contract between X and Y. Yes.92. In a signature by procuration. 96. It reads: “ Pay to Y the amount of Seven Thousand Hundred Pesos (Php700. 94.000.00.00. Php7. B. the drawee. X agreed. . B. C.00 to X’s heirs if he (X) dies in an accident by fire. 95. Yes. The signature of the agent in such a case operates as notice that he has A. D. provided the drawer and payee agree to the acceptance. C.000.00 three (3) months after sight. pay to the order of Mr. Signed. since Y actually made a conditional donation in X’s favor.000.000.100.” May he accept under such terms. D.” Mr. whether or not the indorser received value for the restrictive indorsement. 93. X issued a check in favor of his creditor. D. X”. a drawee is liable according to the tenor of the bill. S.00. Signed. since he is bound as drawee to accept the bill according to its tenor.000. Php700. since all the elements of an insurance contract are present. S.00. a special authority to sign. as long as the indorser received value for the conditional indorsement.00). Yes. the latter promised to pay Php100. B. a limited authority to sign. since. a qualified authority to sign. No. B. No. No. B. A bill of exchange states on its face: “One (1) month after sight. What amount should be construed as true in such a case? A. Yes. since X’ services may be regarded as the consideration. once he accepts. Php700. T. whether or not the indorser received value for the conditional indorsement. R the amount of Php50.000. Php700. D. Yes. Yes. full authority to sign.
approved by at least 2/3 of the stockholders representing the outstanding capital stock. Is presentment for acceptance necessary in this case? A. No. P authorized A to sign a negotiable instrument in his (P’s) name. 7 D. D. It reads: “Pay to B or order the sum of Php1 million. It may be extended or shortened by an amendment of the Articles when approved by majority of its Board of Directors and: A. Signed. in order to hold all persons liable on the bill. D. in applying for a marine insurance policy from ABC. 5 99. Co. 10 B. B then indorsed to C. 100. a public utility..97. C. because it relates to a material representation. the drawer and drawee being the same person.” The instrument shows that it was drawn on P. Yes. What is the prescribed minimum number of Filipino citizens in its Board? A. because there was breach of implied warranty. B. ratified by at least 2/3 of the stockholders representing the outstanding capital stock . Shipowner X. The Articles of Incorporation of ABC Transport Co.. Yes. Will this avoid the policy that was issued? A. approved and ratified by at least 2/3 of all stockholders. ratified by at least 2/3 of all stockholders. Yes. B. Yes. The corporate term of a stock corporation is that which is stated in its Articles of Incorporation. and D to E. A (for and in behalf of P). No. No. E then treated it as a bill of exchange. since the drawer and drawee are the same person. B. C. because there was no intent to breach an implied warranty. 6 C. 98. D. because there was only representation of intention. since the bill is non-negotiable. C to D. presentment is required for acceptance. It turned out later that the vessel departed on the first week of September and with only 10 tons of cargo. C. since the bill is payable to order. provides for ten (10) members in its Board of Directors. No. stated that his vessel usually sails middle of August and with normally 100 tons of cargo.
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