You are on page 1of 17

susmess LAW Any- FLD. Duuqlc .

n ,
Quiz - Law on contracts -~ PART I

er 1. Statements:
In case of doubt 1 a contract purporting to be sale shall be constnued as mortgage. .
In annulment of contracts, there 5ha1|vig be mutual restitution of both parties thereof.
a. First statement is false, second is true c. Both are true
b. Both are false d. First statement is true; second is false
2. Statements: .
Just luke voidable and unenforceable contracts, rescissible contracts may also be ratified.
In case of fraud or mistake, the action for annulment must be made within four years from
the commission of the vice of consent.
a. Both statements are true c. First is tnue, second is false
b. Both are false d. First is false; second is true
I' 3. D, fearing that his creditor C, would go after his only pared of land no satisfy his claim for
payment of D's debt, sold his said land to X who did not know of D's intention. Decide:
a. C can ask for annulment of the sale as this is voidable contract.
b. c may ask for damages against X since he was damaged by the sale.
c. C can file an action for rescission of the sale.
. d. c cannot ask for the rescission of the sale.
A 4. Mutual error as to the legal affed of an agree when the purpose of the parties is frustrated
may result in the reformation of the instrument. .
Mutual mistake of the panies and the instrument does not express the true agreement will
make the contract voidable.
a. Both statements are false c. First is true, second is false.
b. Both are true. d. First is false; second is true.
w3 5. A without authority from B sold the latter's car in the name of the latter. The contract is
a. Rescissible c. unenforceable
b. voiaaue d. void
6. A threatened B with an administrative charge for immorality if the latter does not marry her
8 because she is already pregnant with their child. Fearing that she may do so, B married her.
*@ The contract of marriage is therefore voidable because of threat. A simple mistake of
account may give rise to the annulment of the contract because of mistake.
a. First statement is false; second is true c. Both are true
b. Both are false d. First is true; second is false
g 7. A appointed B to sell his land:
If the authority of B is oral and the sale is in public instrument, the sale is void.-
If the authority of B is in writing and the sale is oral, the contract is unenforceable.
a. The first statement is false, c. Both are tnue
the second is true d. Both are false
b. The first is true; second is false
8. In threeof the following the contract is cleansed of its defect bv ratification. which is not so
A fatlfled
a. Contract where the creditor was damaged by the act of the debtor intended to defraud
b. Contract entered into by a person incapable of giving consent.
c. Sale of chattels orally entered into for a price not less than five hundred pesos-
d. Lease of real property for more than one var orally entered into.
9. A gave B One Million pesos for the latter to kill C. Before B could accomplish his criminal
c intent to kill c, A changed his mind and demanded the return. of the money from B. Decide:
a. A cannot recover the payment he made to B because nt wasa void contract which does
not allow recovery by the guilty party.
b. A cannot recover the money because the contract is unenforceable.
c. A can recover the money although the contract is void since the crime was not
d. No recovery and both A and B will ,prosecuted for their crime.
v 10. Because A wants to sell has land to B but the latter does not want to buy the same, A forced
B to buy his land. The contract:
a. Not binding upon B since his consent waf, vmated .
b. It is unenforceable as against B but not against A.
c. May be ratified expressly Or tacitly by A.
d. It is valid, binding and enforceable.
o 11. D borrowed a sum of money from C with G as guarantor. The loan is in wrrtln9 but the Can
guaranty is oral. D failed to pay C. who now is demandln9 payment from G? G be
compelled to nav'
a. yes, because he is the guarantor obliged to pay in case the debtor defaults.
b. no, because the guaranty is void having been orally made.
c. No, because the guaranty is unenforceable against G, lt being oral.
d. Yes, because the guaranty is enforceable, writing not needed.
A and B agreed on February 3, 2000 tlnat B wrl| construct the house of in rn
January 2002.
YJ 12.
The contrad was orally entered into. B received a down payment from w1 the balance
payable afcer completion of Lhe houae. The contract. as:
a. voudabte because it not m pubhr instrument.
b. Enforceable even If not in wntmq, havmg been raufued. .
c. unenforceable because lt. rs not an
. wrrtnng and yet performance there ns after o e yn ear
from perfectron .
d. Void because rt as not in writmg as required bv law.

13. A sold to B a fake Rolex watch on January 3, 2001. On January 13, 2001, 8 discovered that
the watch he bought from A waa an rmrtatron. The law provsdes that he can annul the sate
as a vordable contract withm four years. Prescnotaon stans from:
a. January 3, 20o1 when the sale was perfected
b. The time of dehvery of the watch to B.
c. The trme they fust talked about the sale of the watch.
d. January 13, 2001 when the fraud was drscovered by B.

14. A and B agreed on a contract of pledge. However, they entered unto a contract of mortgage
C v in the honest belief that the mortgage and oledge are the same. The snstrument may be
a. No, the document cannot be reformed slnce the contract ls vold.
b. no, it cannot be changed. They are bound by the document which speaks for itself,
c. yes, it can be reformed because it does not express the true agreement of the partues.
d. Not, lt cannot be reformed because there was no meeting of mmds between the parties
and the remedy is annulment of contract.

D 15. A and B entered into a contract of mortgage. However, as written the document states it is
a contract of sale with right of repurchase, the error due to the fault of the clerk/typist.
a. The contrad of sale must be annulled since it is voidable,
b. The instrument has to be enforced as is for it is the proof of the agreement between the
parties. ,
c. Because of the negligence of the parties ln signing without first reading the instrument,
they are bound by the contents of the same.
d. The instrument may be reformed because lt does not express the true agreement of the
parties. g

I) 16. S sold to B his parcel of land wonh one million pesos for only half a million pesos. Alter the
sale and realizing his damage, S is now seeking to set aside the sale. Decide:
a. The contract is voidable because of mistake of the seller.
b. It is rescissible because of the.lesi;mor damage suffered by S.
c. S has the right for an increase in the price to prevent unjust enrichment on the part of B.
d. The sale is valid, binding and enforceable because as a rule lesion or inadequacy o cause
or price in a sale dow not invalidate a contract.

D 17. If the cause is not stated in the contract, lt is presumed that lt does not exist.
Lesion or inadequacy of Cause as a rule invalidates a contract.
a. First statement is false, second is true.
b. First is true, second is false.
c. Both are true.
d. Both are false.
a 18. 8 borrowed a sum °f.M0"¢Y from C with a cenain rate of interest. C now wants to increase
dolngat8>"of interest without the consent of D. What principle m contracts prohibits C from

a. Autonomy of contracts d. Consensuality of contracts

b. Relativity of contracts e. Obligatory force and compliance in
c. Mutuallty of contracts ood faith
19. Three of the following contracts must be in writng to be valid. Which is the exception?
a. Contract of partnership where imrnovables are contributed.
b. Contract of agency to sell the land of the principal.
<:. Contract where the amount involved exceeds live hundred pesos.
d. negotiable instruments.

in 20. A threatened to kill B if the latter would not many the formers daughter who was pregnant
with B's child. Intlmldated, B married A's daughter against his will.
a. The contract is not voldable because the threat was made by a third person not bv one
of the parties.
b. The contract is not voidable because the claim for marriage is just or legal and therefore
consent is not vitiated. 1 h nec
c. The contract ls not vordable since B has to answer for his fault that As daug ter ame
d. Voldable ls the contract due to intimidation even if employed by a third person.
C/ 21. The following are characteristics of a void contract. which is the exception?
a. The action or defense for the declaration of the inexistence of a contract does not

b. §1"'°"°`8°b.
C8f1l10 ratfed
c. A contract which is the direct result of a void or illegal contract is voidable. .
d. The defense or lllegalty of a void contract is not available to third person whose interests
are not directly affected.

B zz. The following are attributes of a vddable contract. which is not?

a. It ls binding, valid and enforceable before annulment.
b. Damage is material to be voldable contract.
c. It can be ratified and ratification has retroactive effect.
d. The capacitated cannot allege the incapacity of the other party.

0 23. The following are attributes of a rescissible contract. Except:

a. It is valid until rescinded.
b. Damage or lesion is absolutely material.
c. Third person whose interest is affected may ask for rescission.
d. It is a principal remedy of the creditor to collect his credit.
@ 24. nominate contracts are those without special designations or names under the law.
Innominate contracts shall first be governed by the custom of the place.
a. Both statemenm are correct. c. Both are incorrect.
b. First is correct, second is false. d. First is incorrect, second is correct.

25. Statements:
D contracts take effect not only between the parties but also their heirs and assigns and
the heir is lable beyond the value of the property he received from the decedent.
In stipulation pour autm the third person must communicate his acceptance of the
stipulation before its revocaton.
a. Both statements are correct. c. First is true, second is false.
b. Both are incorrect. d. Second incorrect, tirst is incorrect.

cv 26. statements: .
If the contract is unenforcable and a pubhc document is necessary for the contract's
registration, the parties may compel each other to make the needed pubnc document.
unenforceable contracts unlnke vord contracts may be assailed by the third persons.
a. First statement is correct, second is incorrect. c. Both are incorrect,
b. First ls incorrect, second is correct. d. Both are correct.

27. statements:
A when the defect of the contract consists in the Incapacity of one of the contracting
parties, the incapacitated is obliged to make restitutions unless he did not benefit by the
thing or price received by him.
The actuon for annulment of contrads shall be extunqulshed when the thang whlch ls 113
object thereof ns lost thfougll fortultous event or faaud or fault of the Offff-o" who has a rug
to lnstltute the proceedlngs.
a. Both statements are mcorrect. c. Flr'st as corred, second is uncorrect.
b. Both are correct. d. Second is corred, flrst as mcorrect.
Ratlflcation of a vo1dable or unenforceable contract must be made wlthln the prescruptwe
ff 28.
penod provlded for by the law. ._ . .
Ratnncation cleanses a vonadable or unenforceable contract from all ILS defects from the

moment at was constitutw.

a. Flrst statement ls false, second ns true.
b. Second is false, first if. true.
c. Both are false.
d. Both are true.

D 29. A sent B a Ietter wherem the former offered to sell Ms car to the latter for Php 1m. B
Qngnified h1s untention that he may huy the same. In A's letter, he gave B two weeks to
raise the amount. After one week A :assed the pr|cE Lo php 1.5 M. Can B compel A to
accept the Php 1M frrst offered by A and deliver to him the car'
a. yes, smce there was already offer and acceptance
b. yes, because A cannot chanqe h1=; offer wIthout the consent of B.
c. yes, becaune A cannot w1thdraw the offer wnhm uwo weeks as he as under estoppel.
d. No, because there was no apceptzance vet of the offer.
5, 30. A sold a parcel of iand to B by word of mouth and dehvered to the latter the Transfer
Certmcate of Tille of the land Can B compf~| A to execute the deed of sale of the land'

a. B cannot compel A to execute the deed of sale as the sale belng oral ss unenforceable.
b. B cannot compel A because the sale ls vold be1nq oral.
c. B can compel A because the COl'1!l'8(`1 ls enforceable due to the delwery of the TCT to
d. B can compel A because the sale is merely voldable and therefore enforceable, binding
until annulled;
5 31. Statement no. 1. As a rule contracts take effect only between the parties.

Statement no. 2. mere 1ncudentalbenezf1t of Me lhmi person vs enough for

stnpulation pou/ az/tn to exnst provided he accepts the same.

a. Flrst statement vs true, second statement ns true

b. Furst statement :S true whlle the second is false
c. Both statements are false
d. Flrst statement ls false whlle the second ns true
9 32. Three of the followmg may oblectf, of contracts, except:
a. Those thmgs wlthln the commerce of man.
{ b. Services whlch are not contrary to law, morals, good customs.
c. Intransm1sslble rights.
. 33. Statement no. 1. i cg~*;;g§8'f*\°~f cause are vondabie because cause is presumed to exist

Statement no. 2. Offer must be atrsolute and acceptance must be cevtam before can there
be meeting of the mmds of panies

a. Flrst statement is false, whlle the second is true.

b. Both statements are true.
C. Both statements are false
d. Flrst statement ns true while the second is false.
34. Statement no. 1. Contract of iease of a parcel of land for a term of one year must be
D wntten otherwuse unenf9rceab!e,
Statement no. 2. Contract of sale of a parcel of 1. and must he n . ubl l . r n othecw se
unenforceable. I D sc nst ume r |
a. First statement s false while the second ls true.
b. Both statements are true
c. Fvrst statement is true whsle the second ls false.
d. Both statements are false
3 35. A contract wh ' .
ereln both contracbng pan' . ble of ivin consent a d et tifed
bv the guardian of either of the parties us: les are incapa Q Q nv ra l
a. Rescssble
b. Voidable
c. Unenforceable
d. Void
A ss; Three of the following contracts are void. which one is not'
a. Oral contract of partnership wherein more than php3,000.o0 has been contributed bv the
partners. i
b. Agent given oral authority to seil the land of the principal.
c. partnership contracts in private instrument wherein immovables have been contributed.
d. Oral contract of limited pannership.
D 37. which one of the following constitutes fraud?
a. Misrepresentation made not in bad faith;
b. misrepresentation by a third person and both panies mistaken.
c. Usual exaggerations in trade or dealer's/sale's talk .
d. Failure to dsclose facts when there is a duty to reveal them as when the wma are
bounded by confidential rdations.
v 38. These are principles in contracts. Which is not?
a. Freedom or autonomy of contracts c. perfedion by mere consent
b. Relativity of contracts d. Blndmg on third persons

cf/ 39. which of the following constitutes an offer?

a. Business advertisements of things for sale.
b. Advertisements for biddels
c. An offer made through an agent . .
d. Before acceptance is conveyed, either of the parties dies, civilly interdlcted, becomes
insane or insolvent
40. Statement no. 1. There is acceptance of the offer only after it has come to the knowledge of
the offerer.
statement no. 2. Leslon or inadequacy of cause shall as a mle make a contract defective.
a. Both statements are true c. Both statements are false
b. Second statement is true; first is false d. First statement is true; second is false

A 41. Statement no. 1. If the cause is not stared in the contract it is presumed that it does not
exist and therefore the contract is void.
Statement no. 2. In order that a contract may be voidable, there must be damage.
a. Both statements are false c. First statement is false, second is true
b. Both statements are true d. First statement is true; second is false
42. The action to annul a voidable contract is extinguished by:
3 a. Novation c. Resclssion
b. Ratifiation d. Estoppel
43. Which of the following contracts is unenforceable?
0 a. One of the contracting parties is incapable of giving consent.
b. Contract of lease of a car for two years orally entered into.
c. Oral contract of sale of land.
d. mortgage contract in private instrument.

44. Which of the following contracts is not void ab /hit/D?

a. Those whose object is outside the commer.
b. Those whose object did not exist at the time of transaction.
c. Those which contemplate an impossible sewe.
d. Those undertaken in fraud of creditors.

D 45. Contract which cannot be sued upon unless ratitied, thus it as if tney have no e1Tect yet:
a. Voidable c. Void
b. Resclssble d. Unenforceable /m248/fzék

46. Which of the following contracts is valid?

D a. Oral contract of agency giving authority to an agent no sen the land of the principal.
c. Oral contract of sale of an immovable entered into bV an agent who was given oral
. c.
authority by the principal.
Oral agreement to answer all the expenses for the wedding reception if A marries B.
47. A soéd to 8 a genome bottle of Fundador branov. rtowwm, utiorr rl¢8iw4:!'/ W" forrrm
substntuled a fake, B now wants m annul the we. tm we;
a. The contract 1'»; vold dt/ /mnothe-r|>fore at (au rf- annmierl
b. The contract can be annulled SINFS sl 14 vfrrriabw r)1n»fN fr-md.
c. The contract cannot be anmmed became ri 19 only m¢;,¢:|»y»,|..,§ haw
d. There 19 do/o /nc/dentsrherefnm rt ran hw mmnwr
@ 48. G was appornted as the guardran of M who ownr. A faarrrt of land vatued ar PYTQIM, m wid
the land only for Php. 7M to B. The contract rs df'fevit~4~ bemu*r .'
a. Unenforceable f. ~/mdabte
b. Res(:rs;sit>le fl. _/0|/3
49. S was lntimidated by B to sell to the latter Mf, parrf-BUf land at a wr/ law ufwf (wr Me
credutor of S was thus damaged srnce theforrner néfa nOmmf mrfafi'-»of foikafifrrg "ff" S.
The remedy of S:
a. Rescrssron c. Have 1{ fjerflmefi bv the mlm ae vfxd
b. Annulrnent d F<efr»rrra.t»cfluf the rrmlracl
50. which of the followmg contrads mum be rn wntmg ro bf- enforca»ab!¢:7
a. Acts and contract for the, tran'-,mrssfon, rrvxirfrfown, »mr¢,wf>hrr»ern4 of ful
b. The cessron, repudoatron, renuncrataon of heredrtv fK]ht5s.
C. Contract of guaranty
d. Contract of partnershrp

O 51. ruer/od lr/ the latter cm January 2,

2001. On January 4, 2001 B sell! a letter of acceptance ny mais, on Jan-:ary 3, 2001 9 w4
ln th1=, case:
a. There was a perfeded sale because of the acceptance d the offer by 8 bdore he H86
knowledge of its withdrawal by S.
b. There was perfected Qale because S was estouped from withdrawing ms offer m1899 B
had knowledge thereof before acceptance.
C. No sale took place because before accentance was conveyed, the offer had been
d. The offer was ineffective for lack of certainty as to the object.
52~ Statements:
An offer made by the principal is accepted lrom the time accevwnce is conveyed W him or
his agent.
The object of a contract may be future things rncludrng future inheritance.
a. Both statemente are true. h Weconrl rf, falw, nm is true.
a. Both are false. c. First is fahe, 411006 is true,

0 53. Statementbz
A contract wh~|ch cs the dlr%t resun of a vord comraci 6 vornaole
If the object of the contract dad not exnst a1 the mmm hf the \fan 0on »t 6 m. Therefore
rms may include sale future thmgs,
a, First £9 true, second as false. c. Both are favf.
b. Furst 19 false, second rs lrue. d. h are true,

54. A sold ln wrltlng to B hls stereo set for Php600,()0_ Therét uf; rw déhvéry from A ami no
D payment of the price from B. Contract vs:
a. voldable c. x/old
b. unenforceable 61 Enforceable

51 55. If the words of the contract are clear and Ieave no doubt on the mlemson of the pameg,
interpretation of contracts may be proper.
incase of gratustous contracts, doubts shall be resolved in favor or greatest reclproclb/ nf
a. The Nrst statement is false, second us true
b. The nrst statement is true, second is false
c. Both are lrue
d. Both are false
O 56. S sold his parcel of land only for Php IM although the value nf the aarne vs php 2M. He mug
suffered damage or lesson in the sale due to the inadequacy of the nmze rherefnre the
contract iS
a. vosdabse c. vaffq, not nefercuve
b. Unenforceable d.

Atty. M.S. Bonafe Jr.
Quit - Law on Contracts - PART n

A 1. w*- e Cofftfact lacks one of the essentiai elements the contract is:
d. All of the above
D. voidable e. none of the above
c, Resc1ssibie

A 2. The act or means by virtue Of which emcacy is given to a contract, which suffers from a vice of
curahle nuiiity.
a. Ratification d. All of the above
b. Resolution e. none of the above
c. Rescission
p, 3. is a remedy in ¢0uity by means of which a written instrument is made or constructed so as to
express or conform to the real intention of the parties when some error or mistake has been
a. Ratifi£8{i0n d. All of the above
b. Reformation a. none of the above
c, Rescission

D 4. Although contracts bind only contracting pams, their assigns and heirs, In the following instances
thlrd persons are bound thereby:
a. In case of otlpulation pour autrui fm
b. In contracts creating real rights /J/2
c. In contracts lntended to defraud the creditors /6/8
d. All of the above
none Of the above
0 5, A qualuned acceptance constitutes:
a. An absolute acceptance
U. A meeting af the minds between the parties
c. cbunter offer
d. AN of the above
e. None of the above

D 6. An offer becomes ineffective if, before acceptance is conveyed, either panies becomes: 162%
a. Civeliy interdicted d. An of the above
b. Insane e. None of the above
c. Insoivent

7. A contract where consent is given through mistake, violence or intimidation is:

p a. Void d.. Vo|.4ab1¢/
b. Unenforceable e. None of the above
c. Rcscis5ibie

A s, The span of time wherein a person is in possession, temporarily, of all his mental faculties-
a. Lucid lnlewal a. Reglementary period '
b. Optlon penod e. none of the above
c. prescrlptlve period

9, Contracvs entered into in a state of drunkenness or during hypnotic spell is:

A a. v0|dab4e d. Rescissible
b, Vmd e. none of the above
c. unenforceable

w, An offer made through an agent is accepted from the time acceptance is communicated to-
a. The principal d. The household member of the prindpal
b, The agent e. none of the above
c. sloth the prlnclpal and the aqenr
3 11. The essential or impeliing reason why the parties enter int8 a contract:
a. Motsve d. Au of the above
b. cause e. None of the above
c. protit

9 12. The statement of a false cause in contracts shall render the contracts:
a. voidable d. Rescéssible
b. Vocd e. None of the above
c. unenforceable

A 13. If mistake, fraud or acczdent has prevented a meeting of the minds of the pames, the nrooer
remedy IS:
a. Annulment d. Reso¢utiQn
b. Reformahon e. none of the above
c. Rescission

14. The following contracts are valid:
a. Rescissible d. A!! of the above
b. Annullable e. none of the above
c. unenforceable

0 15. a contract entered into in the name of another by one who has no authority or legal
representation is:
a. vom d. unenforceable
b. Rescissible e. none of the above
c. Annullable

16. Business advertisements of the things for sale are:

49 a. Dennite offer d. Acceptance of the offer
b. Invitation to make an offer e. none of the above
c. Counter offer

.P 17. The following is an examde of a real contract:

a. Contract of pledge r
b. Contract of oeposzt
c. Contract of commodatum
d. An of the above
e. none of the above

,4 18./4 In case of divnsible contract, if the iitegal terms can be separated from the legal ones, that the
latter can be enforced.
B. The defense of illegality of contracts as available to third persons whose interest are direwy
a. Both are true C. First iS false.
b. Both are false d. Second is false

8 19. A and B entered into an oral sale of the former's car for PIM which amount has been credited to
his bank account although the car has not yet been delivered to the latter. can B compel A tO
execute the deed of sale of the car?
a. no, because the sale is unenforceable.
b. yes, because it is enforceable.
c. yes, if A used the money paid to him
d. no, because the sale is void.

(L 20. on January 20, 2002 A and B agreed verbally to fomw a partnership on January 25, 2004.
a. The contract is vod because future nr0perw can't be contributed to a universal
pannership of all present properly-
b. It is voidable if the panies marry each other before they form the partner5hip.
c. unenforceable because it is not in writing.
d. Void because there is no public instrument of their agreement. "
21. A orally leased to B his car for a term of2 years. B has not taken possemon Of the car and A has
not received any rental. The contract is;
a. unenforceable c. Rescissible
b. Valid and binding u. voidable
A 22. Based on the preceding number, if the objed were a house, the contract shall be:
a. Unenforceabre c. Rescsssibte
b. Valid and binding d. voidable

A 23. If the object were a parcel of land.

The contract is:
a. Unenforceable
C. Rescissvble
b. Valid and binding .
d. voidable
. 4 1 MMI ' -1' ..~~ -L .ff
?> I l8ei1g!'fhe éf888r4s'616
24{@'~ un the name of the latter and by virtue
thereof the latter was able to tlnish high school. The contract is:
a. void c. Rescisssble
b. Unenforceable d. voidable

25. wthout authority from A, B sold in B's name the land of A to X who was in good faith. The
3 contract is:
a. void because B was not the owner at the tme of the perfection of the sale.
b. Unenforceable, because B had no authority to sell A's land.
c. voidable, because of the fraud committed by B against A.
d. Valid sale provided 8 is owner upon delivery.

26. Based on the preceding no., rf the sale m A's name, the contract is:
a. void, because B was not the owner at the time of the perfection of the sale.
b. unenforceable, because B had no authority to sell A's land.
c. voidable, because of the fraud committed by B agasnst A.
d. valid sale provided B is owner upon dehvery.

27. If the doubts are cast upon the principal object of the contract in such a way that it canna be
F known what may have been the intention or will of the panies. The contract shall be:
a. voidable due to lack of meeting of minds.
b. void
c. Interpreted for there is doubt.
d. Reformed to express the true intention of the parta.

14 28. A offered 20 Tamiya cars to B for P1,000.00 each. B answered by letter that he was willing to
purchase not 20 but 30 pieces at said price of P1,000.00 each. ls the contract perfected?
a. No, because there is qualined acceptance which constitutes an offer by the buyer.
b. yes, there is perfected sale because the number of pieces is only incidental matter in the sale.
c. yes, because the letter of acceptance was already sent by the offeree.
d. No, because there is no offer yet of A that is certain.

CD 29. Statements:
If one of .the parties at the time of making the ffore or acceptance wa I d msa
contract is v0dable. s a rea y ne the
If before the acceptance is conveyed to the offerer, eithe of th mes .
contract isvoid, that is, the offer is noneffective. r e na nec insane, me
a. Both statements are incorrect. c. First is correct, second is inc
b. Both are correct. d. Saond is correct, mst is incorrect.
D 30. A, a minor sold to B a parcel of land fe9istered in his name misrepresenung to the latter that he
is of legal age. Having been mlsled as to the true age of A, B entered into the contract.
contract voldable° 15 me
a. Its 0voadable because the seller is a person incapable of giving consent to a contract being a
b. It us voldable because of mistake on the pan of B he he
c. It is not voidable but rather vold because of lack :Yr conse T38" `E28' A "ps of legal age.
IS ON y 3 Mlnof wlthout
d. It is not voidable because of the fraud ml .
good falth. com treo bv the mlnor seller and the buyer being in

p 31. A, a director of X corporation, through an agent

reveahng to the seller stockholder bought the shares of stocks ar another
stockholder without
enhance the value of the shares. The sale ns defective contract being |
that negotiations were in progress no
a. Vo`d, because of fraud committed by A against the other stockhoider.
v0.<3ab|e because of mistake on the can of the seller-stockholder.
c. Rescissable because of the damaqe eeuffered by the seller.
d. voldable due to the fraud concealment by A agalnst a fellow stockholder.

32. Whlll? his father was _.ull alive, A sold to 8 the property he (A) expected to receive from his
father. Is the contract defectlve?
a. It is completely valid contract because the seller is compulsory heir.
b. It ls valld for there can be sale of future thlngs and what A sold ls future nr0pefw.
C. It is vcvidable sale If he fails to receave the property he expected to recesve from his father.
d. It ls void for future inheritance cannot be sold. .

.A 33. A promlsed to glve B a car as reward after B has killed c. Later, after the kllllng, the contract was
changed to a lease of a bug house for a celtaln penod.
The contract of lease ls:
a. Vold
c. voidabie
b. Unenforceable
d. Rescussible

P 34. S orally sold to B a parcel of land for which the latter paid P1M. B now wants to register the sale
so that he can have a Transfer Certificate of Title in his name. Decide. .
a. S cannot be compelled to execute the public document of sale because the sale Is
b. S can be compelled to execute the public document of sale because the sale is enforceable.
c. The sale is void and therefore cannot be registered . .
d. S cannot be compelled to execute the public document of sale because the sale is voidable.

35. S orally leased to R his parcel of land for a term of two years. The contract is:
a. Resclsslble b. voldable c. Unenforceable d. Void

36. A verbal agreement was made betwee A nd B whereby A agreed to sell and B agreed to buy A's
Ff farm for P100,000.00. The price wasiéizif Possession was not given nor was the deed delivered,
both bemg refused. The contract ls:
a. Rescissible b. voldable c. unenforceable d. Void
37. A orally leased to B his car fro two years. No delivery of the car was made and no payment of the
rentals was given. A refuses to pay the rentals in advance as agreed upon.
a. A may rightfully refuse because the contract ls unenforceable.
b. A cannot refuse because the contract ls enforceable.
c. B cannot compel A to do something against the latter's will.
d. The contract ls reciprocal and therefore A cannot be compelled to pay because there was no
delivery of the car.

9 38. A borrowed money from B with c as guarantor. The contract of loan of P1M was not in writing
while the guaranty was written. B now is demanding payment from c because A failed to pay. Is
C liable?
a. C is liable because the guaranty is enforceable although the loan is void it being oral.
b. c is not liable because the accessory contract of guaranty ls void since the principal contract
of loan is void.
c. c is liable because the guaranty ls enforceable.
d. c is not liable because the contract of loan is in amount exceeding P500.00 which must be in
writing to be enforceable.
f 39. A was having his house repaired bv B, who needed certain materials. So A told the storeowner,
'Give B the materials. I shall be responsible. I shall stand good.' This was orally entered into.
a. The contract is unenforceable because A made an oral agreement to answer for the default or
another, that is, B.
b. The contract is enforceable because A did not make a special promise to.answer for the
default of another person .
c. The contract shall be enforceable if there is ratification by A.
u.. The contract shall be enforceable if it has been executed.
il 40. A and B mutually promised to marry each other. The promise being verbal and without witnesss
to the promise, A did not marry B. B is now suing A for damages. Decide:
b, The contract is unenforceable, hence, A is not liable.
c. The contract is unenforceable because mutual promlse to marry is covered by the statute bf
d. A is liable for damages even if the contract is unenforceable.
e. A may be liable for damages because mutual promise to marry is not covered by the Statute
of Frauds.
41. A and B, neighbors, orally agreed that from that day,
tall after three years. ,
B would not erectorathe
garage on his progeny
complavns and B sets upA the
week later Bofbegun
defense to erectbemg
the contract a garage in violation
unenforceable agreement. A
a. The contract is u f Decide.
making there0gnen orceable because It us not to be performed within one year from the
and it is oral. . . . . rd do.
b . B can be compelled to demolish the fence because he falled ln Ms obllgat»on not
c. Ancont£adve a third person to undo what has been done by B in violation of his obligation
d. A has the right to complain and enforce the contract because it is enforceable.

O 42. A and B orally agreed that A would sell and B would buy A's radio for P200.00 three years from
the date of the agreement.
At the end of the three years, A refused to hand over the radio
although B was willing to pay. Is A bound to deliver the radio sold"
a. A is obliged to deliver what he sold since it was an enforceable sale.
b. A is obliged to deliver if B is ready to pay the price.
c. A is not bound to ddiver because the sale ls unenforceable.
d. A is not bound because the sale is void.

43. A forced B to sei! to him (A) his ring. B sued for annulment, but A had already lost the ring thru
fortuitous event. Is A name for the loss?
a. A as liable for the loss even it was due to fortuitous event because of his bad faith.
b. A is not liable because the loss was without his fault.
c. A is liable to pay damages if he cannot replace the ring.
d. A is not liable because no one shall be responsible for the loss of a thing due to fortuitous

Q, 44. A was forced by B to sign a contract. c, a creditor of A wants to annul the contract. Is c allowed
by law to do SQ?
a. no, because a third person cannot assail a void contract.
b. yes, because the contract is voidable and C is damaged.
c. No, because a third person cannot assail a voidable contract.
d. yes, a third person can annul a rescisslble contract.

45. To defraud his creditors, A sold his real property to B. B now seelG to register the sale. X, a
U creditor, seeks to prevent the registration on the ground that it is a resclsslble contract. Despite
X's objection may the land be registered in B's name'
a. no, because the contract is rescissible and therefore without effect.
b. no, because the sale is voidable and after annulment is not binding.
c. yes, because the contract although voidable is valid and binding.
d. yes, because the contract although rescissible is valid, binding and enforceable before

46. A made a donation to B. Later A contracted several debts. what A has left as assets are much less
A than his present Iiabiimes. May the donation to B be rescinded' .
a. no, because the debts were incurred after the donation has been made.
b. no, nf A gave guaranty or security for his debts.
c. yes, because the donation is rescissibie being in fraud of creditors.
d. Yes, because A has become insolvent after the donation.

47. To defraud his creditor, A sold his property no B (who is in good faith). Later B sold the property to
8 C, who is in bad faith. May the creditor rescind the sale?
a. yes, because the third person C, is in bad faith.
b. No, because the third person B is in good faith.
c. no, because the contract is voidable and not rescissible.
d. yes, because the contract is rescissible.
48. To defraud his creditor, A sold his house to X. When however the creditor wanted to collect his
8 credit, somebody lent A enough money. Is the sale rescissible?
a. yes, because it was entered into fraud of creditors.
b. no, because the creditor can coiled the credit due to him.
'c. No, because the ®btor Has become ln good faith when he was lent enough money no pay
his debts.
d. yes, because the debtor was in bad faith when he sold his house to x.
49. A oraliy sold to B a house at 16 Kiko St. malate, manila.
the true number of the house and instead wrote on the contract "No. 18 IGko St. malate, Manila.
ReSA: The Review School of Accountancy

The remedy shall be:

a. Annulment of a voidable contract because or mutual mratake.
b. Reformation of instrument because of lack of meetlng of minds.
c. Reformation of instrument because of mutual error. .

d. Declaration of nuilrty of the contract because of the uncertainty of the intentIon as no the

D 50. A loan for P800.00 was orally contracted. May the lender recover the sum lent?
a. no, because the contrad is unenforceable.
b. no, because the contract must be in writing to be valid.
c. yes, if the debtor ratifles the loan.
d. yes, because the contract ns enforceable.

c 51. When has father area but before the delivery of the Df0oertv no hum, a son sold his share of the
property inherited. Is the sale valid?
a. No, because future inheritance cannot be sold.
b. yes, because future inheritance can be the oblect of the contract.
c. yes, because what has been sold is present inheritance.
d. no, because the son was not the owner due to lack of delivery to him.

52. Element without which there cannot be a contract ss:

a. Essential element d. An of the above
b. Natural element e. none of the above
c. Accidental element

53. Contracts take ef¥ect only the parties, their assigns and heirs except where the rights and
J> obligations arising therefrom:
a. Is not transmissible by their nature
b. Is not transmissible bY stipulation of the names
c. Is not transmissible by provision of law
d. All of tne above
e. none of the above

54. Where damagw is caused to either of the contracting M418 or to a third person the contract
may be: '
a. Annulled d. An of the above
b. Rescinded e. none of the above
c. Raunea

1 .*
_ END-

D 1. Must be in writing to be enforceable:

a. Lease of land for 12 months c. Both a and b
b. Lease of car for 18 months d. none of a and b
2. Which of the following ls not a requisite for the valldlty of a contract? .
a. Consent b. Object c. Cause d. Dellvery

D 3. o owes c ps00. However, C's right has already prescribed. Nofwltzhstandlngthe knowledge °f thus m,
D pald the amount. Realizing this mistake, D wants to recover the amount he paid.
a. D can recover on the ground of mistake
b. D can recover because hls obllgatlon ls not enforceable
c. D can recover otherwise C will be enriched at the expense of D
d. D cannot recover
D 4. Three of the following contracts are void. Which ls the exception? .
a. Those who cause, object or purpose is contrary to law, morals, good custom, public order or public
b. Those which are absolutely simulated or fictitious .

C. Those whose cause or object did not exist at the time of the transaction
d. Those where both parties are incapable of giving consent to a contract

D 5. x, a former government employee, suffered from severe paranoia and was confined in the mental hospital
In 2000. After his release he was placed under the guardianship of his wife to enable him to get his
retirement pay. In 2004 he became a mining prospector and sold some mining claims. In 2006, he
wants to annul the sale claiming that he was not mentally capacitated at the time of sale. The sale in
question was
a. Resclssible b. Void C. voidabbe d. Valid

6. which of the following is not presumed to be legal subrogation?

D a. when a creditor, pays another creditor who is preferred
b. when a third person, not lnter8ted ln obligation, pays with the approval of the debtor
c. when a third person interested ln the obligation pays even without the. approval of the debtor
d. none of them
. *WJ
D 7. Essential requisites of a contract: 65,¢9ll**'/a u Z`f2_]6*'3*
a. Consent b. Cause c. Subct d. All of them

D 8. Which of the following Instruments is not subjed to reformation?

a. Simple donations inter vivos wherein no condition is imposed
b. wills
c. when the agreement Is void
d. All of the above
9. valid, binding and enforceable until annulled
(L a. Rescisslble contract b. void and ab initio contract c. voidable contract d. Validable contract
10. In three of the following defective contracts, ratification deanses the defect. which as the
O exception? .
a. Both parties are incapable of giving consent
b. Sale of immovable propeny or Interest therein orally entered into
c. Sale ofpieoe of land thru an agent and the authority is oral
d. contracts entered into by a person who has been given no authority

A 11. S makes an offer to B on January 1, 2007. B makes known his acceptance In a letter sent un January 2,
and received by S on January 5. meantlme, on January 3, S became insane
a. The contract ls voidable because one party is insane
D. There is already a meeting of minds, the contract is nerfecrecs
c. The contract is not bmding because there is no meeting of minds
d. The contract is void the offer being ineffective.
(1 12. Based on the same facts except S ls sans . but only a minor at the time the acceptance as
communicated to him.
a. There is no meeting of minds between the parties, therefore void.
D. Tne contract is not bmcilng because the party is incapacitated
C. The contract is binding between the parties
d. The contract is unenforceabte.

C 13. which of the following contract ls voidable? I

a. Those whose object is outslde the commerce of men vo-1
b. Those whlch are absolutely llctlllous
c. Those where one of the partles is incapacitated
d. Those whlch contemplate an lmposslble servlce. w/
C 14. The .stlpulation in a contract to the effect that the debtor should remam as a §ervant In the house and in the
servrce of her creditor so long af. sre hao r|ol pald her debt is void because it Is.
a. Contrary to good custom c. Contrary to law and morality
b. Contrary to public policy d. Contrary to public order.

C 15. X, after the death of his father, sold his inheritance though its amount has not yet been
determined to B, for a consideration of PS0,000.
a. The contrad is valid only lf the inheritance valued at least equal or more than P50,000
b. The contract ls rescissible
C. The contract ls void lf nothing remains of the inheritance to be turned over to B
d. Contract ls void, future inheritance cannot be the object of sale

O 16. x alleged that Y promised to glve him one hectare of land. This ls ln consideration of X's meritorious
services to Y. Y pleads ln defense that since the promise was not in writing, it is unenforceable under'
the statute of Frauds. Decide.
a. The promise is unenforceable because it is not ln writing
b. The Statute of Frauds is applied because A has rendered services
c. The Statute of Frauds is inapplicable here, because the promise to give the land ls not a sale
of real property
d. The statute of Frauds can apply to partially executed contract
6, 17. statement no. I: In voidable contracts, there ls no need to ratify the same before they can be
considered validTIn unenforceable contracts, however ratification is mandatory before they can be
considered enforceable. T
Statement No 2: "There ls undue influence if insidious words or machinations was employed by a party
on the other just to obtain the lattef's consent, without which the latter would not have entered .into the
a. Both are true c. No.1 is true while no.2 is false
b. Both are false d. No.1 is false while no.2 is true

0 18. Three of the following are void contracts. which ls the exception?
a. Contracts where the cause is immoral
b. contracts to prevent a known supporter of a political rival from vaing for his candidate for a
valuable consideration
c. Contracts with valld consideration but with unlawful motives
d. Absolutely simulated contracts

0 19. Statute of Frauds is appiicable to

a. executed contract
b. oral contract of loan '
c. contract not to be performed within a year from the making thereof
d. mutual promise to marry.

20. Which of the following is correct?

c4 a. An action to enforce judicially a natural obligatlon prescrlbes In 4 years
b. An action for annulment of contract is lmprescrlptible
c. An action to declare a contract vold is not subject to prescription
d. *\3n8;§§>" for resclsslon of contract prescnbes ln five (5) years counted from the ex ion of the

21. 8 frauduientiy ammces S to sen to him (B) a masterpiece paunu fn p1 Subs8qu6|'\¥ly,BsoidR(Dx

O for P120,000, a good faith purchasér. s is entitled to "Q r 00,000.
a. Annul the contract with B plus damages
D. Recover the painting from x but no damages
Recover damages from B
Annu# the contract between B andx
a 22_ Which uma followl contracts is not rescossible?
a. Those whlch 8"9 entered lnto by guardlans whenever the wams. whom they represent surfer a
lesson of more than 'A of the value of the object of the contract. l . n more than 'A of the
Those executeo in representation of an absentee, af the latter suffer a 8510
value of the object of the mmm
d, Those undertaken in fraud of credltors when the latter canno
due them

C, 23. when there is concurrence of offer and acceptance, there ls:

a. Consummation Conception d. Consideration
b. c. Consent

C/ 24. wmch of the following contracts is voldable? cr

a. Those where both parties are incapable of giving consent to a C0(1[
Those undertaken in fraud a creditors when me latfer cannot tn any
co¥lect the ctaims due them . . flue or
c. Those where the consent is vitiated by mistake, violence, bntimidatron, undue M nce
d. Those whose object is outside the commerce of men

C/ 25. Which of the following contracts is resclssible?

a. Those where one of the parties ls incapable of giving consent to a contract
b. Those where both parties are incapable of giving consent to a contract
c. Those which are entered into by guardians whenever the wards whom they
represent suffer a lesion of more than 'A of the value of the object of the contract
d. Those which are absolutely simulated or Hctitious.

26. which of the following can be considered as a feature of a void contract?

1> a. Subjed to ratmcation
b. It exists
c. Action or defense of nulltty is subject to prscriptlon
d. Novation cannot apply

27. L entered into a contract of mortgage with X. T, the clerk of L, typed the docummt. Due to T's
9 neghgence, the document made was that of sale instead of mortgage .
a. The remedy is annulment
b. Parties may go to court fur interpretation
C. parties may enforce their right because it is enforceable
d. Reformauon of instrument is proper

28. These persons are bound by contracts, except;

A a. Third persons o. Assigns c. Heirs d. parties

29. Liable for the loss of the subject matter by fortuitous event:
D a. Creditor c. Both creditor and debtor
b. Debtor d. none of them

30. Sfollowlng
offers. to is
his house to B for P 100 000. BI asks him lf h whuch- of the
8 e would acce pt 80,000.
a. Because of ambiguity, both offers are terminated by operation of law
b. ps0foogéf
B's es e is a co u te
n r-o ffer effectlvely
' termnnatmg
. the P 100,000
' offer and.1nst|gating
. an
offer for
c. B's response is a rejection of the P 100,000 offer, and th s no P80,000 because it as too
indefinite to be an offer. ere | offer for
d. B's response is a mere inquiry, the P 100,000 offer by S is still ln force

31. Example no. 1: G, guardian of w, sold W's house valued at P50, ooo for P371 soo or a lesson by 'A of me
17 value.
Example no. 2: S sold hls house valued at P50, 000 for only P10, 000 because 5 dia not know me true value
(N the house.
a. Both contracts are resdssible.
b. Of*y no. 1 is resdssuble
c. no.2 is voidable because there ls an error or mlstake.
a. 50:91 are valid and enforceable.
*\¢"\Fl r1»vuulluuI.L! page4
37 32. B
thereafznye bought out a oompecimr, C Corporation, with a stipulation that C Corporation should not
a. 9398 In any business ln the phlllpplnes unless consented to and approved by B company,
The stipulation is defective but subject to ratihcation .
b. We stipulation ls valld because the parties am free to enter lmo any stipulation, terms and
such as this one.
c. We stipulation is unenforceable as there was no showing that the sale was done ln wrltlng
d. The stspulation is void because it ls wntrary to public policy.

33. which of the following is not valid?

D a. mutual promise to marry entered into orally I
Sale of immovable propeny orally entered into . nsent
c. One of the parties in a contract is incapable of QWIUQ co 's conse r
Mortgagor of an immovable cannot alienate it w1thout the mortgagee n' I

D 34. D forced C to execute a promissory note.

a. Contract is rescissible because the contract is fraudukt
D. The contract is void .
C cannot demand payment from D because the contract ns unenforceable
d. Contract remains to be valid .

D 35. Example 1- S sold to B in a private instrument his land. Later, B wanted to have the sale reglstered; but
reglstratlon requires a public instrumentz In here, B may compel S to execute the needed public
Example 2- S sold to B orally hls land. After B pald S the price he wants to reglster the land ln his name
but he needed a public instrument of sale. In here B may compel S to execute the needed public
a. Botn examples are false c. Only the second is true
b. only the first ls true d. Both exampies are tme

36. In a contract of sale executed by S and B, it appears s sold his motor vehicle to B for P50,000. It turned
1> out however, s has three motor vehicles. Gallant valued P80,000: Hi-Ace van valued P70,000, and a Jeep
valued P60,000. which of the following is correct?
a. The contract shall be reformed because there was mistake
b. The parties can ask for interpretation because the word Motor vehicle is ambiguous.
c. The panies can ask for annulment of the contract
d. There ls no contract.

37. An agreement in restraint of trade or establishing monopoly is:

D a. Perfectly valld b. voidable c. unenforceable d. Void

38. Three of the following are resclsslble, which is not?

~@ a. Sale of property under litigation made by defendant without the. consent of plaintiff or authority of
the court.
b. Those made to defraud aedltors when the latter have no other means to recover their claims
c. Those agreed upon ln representation of absentees, if the absentee s ffe lesion b m 4
' of the value of the property subject of the contract u rs y ore than 1/4
d. Contract of sale and the price is unusually inadequate resulting to lesion
39. S and M agreed ln print that S, debtor for P3.000, will work as a servant of M wlthout pay until she could
p llnd money with which to pay her debt. S failed to comply with her obligation, under this premise, which
of the following statements ls correct?
a. The agreement to work as a servant is void because it ls immoral.
b. To act as a servant without pay is unconstitutional because this is equivalent to involuntary
c. The agreement to work without pay since written ls enforceable.
d. The contract to work without pay as a servant until the debt is paid is vold.
40. Which of the following contracts ls not required to appear in a public document?
D a. Acts and contracts which have for their objectthe creation, transmission madmcauon or
extlngulshment of real rights over immovable propeny.
b. The cesslon, repudlatlon or renundation of hereditary rights
c. The power to administer property
d. Sale ol' immovable propeny

p 41. In order that a stipulation in favor of a thlrd person would be valid and binding upon the pawes tnemw
the following are the requlsltes, except; . '
a. There must be a stipulation in favor of a third person.
b. The contracting parties must have clearly and deliberately conferred a favor upon that third
c. The third person communicated his acceptance to the obligor before its revocation.
d. That there must be an existing agency between either of the contracting parties and the third.
-- ....< Iu o|..nool0JAccountancy
42. Statement
U1 NQ_J,: Dolo
D Incld ente entitles the person against whom It was employed the rtght to seek
se annulment of the contract.
5ta.tement..,hL0._7.; A stapulation
u KLU1 ls an exception to the rule on relativity of contracts.
a. Both are true
c. No. 1 is true, no. 2 ls false
b. Both are false
d. No. I ls false; No. 2 is true
D 43. E1<_¢mn1e_N_0_J.; w, 16 years old, sold ms muse valued at p 1 m for P500,000 or a lesion by more W" one-
fuulth of the value of the said house.
ExQ.mple.n,Q_z s sold his house valued at p 1 m for only p500,000 because of hls poor judgment on
the true value thereof.
a. Both are voldable. c. no. 2 ls unenforceable
b. No. 1 ls resclsslble; whlle no. 2 ls voldable d. Both contracts are blndlng ln lr was
44. s owns an oll paintlng. Belng ln need of money, S sold the painting to B for PL000- After Me sa
dlscovered that the palntmg was valuable and worth PS,000,
a. S may resclnd the contract due to leslon or inadequacy of cause
b. S may annul the contract because of fraud
c. S may annul the contract on the ground of error
d. B ls entitled to the benefit of the contract because it ls valid and blndlng

45. "A', bachelor lawyer, raped w. upon learnln this "F"

I the father of W, was able to force A to marry w
fr 9
under pain of being sued and dibarred from the practice of his law profession. Which statement ls
a. The marriage may be annulled on the ground of force or violence
b. The marriage may be annulled on the ground of threat and intimidation
c. The defective marriage may, however, be ratified
d. There was no defect, the marriage was perfectly valid
D 46. In an 'invitation to bid", B proposes the following:
'I will buy the property for P100,000 and if the bid of any other offerror or bmw shall be considered
Me best in terms of amount and conditions, Iam equal to that offer".
a. The offer is speculative, because lt cannot be considered as against another offer which ls certain
b. 'The offer ls considered a counter offer
c. This is a continuing offer which is very cenain
d. The adveniser is not bound to accept the highest highest bidder

47. Statement no. 1;,__If the cause is not stated In the contract It is presumed that lt is unlawml-
a Statement No.2, The action for rescission is subsidiary it cannot be instituted except whm there is no
other legal means to obtain repamtlon for damages suffered.
a. Both statements are true. c. Only the hrst is faise
b. Both are false d. Only the first ls true
48. G was appointed guardian of s, the latter being 16 years old. S sold his parcel of land ln wntlng to B
0 valued at P 100,000 for P75,000, suffering lesion by '/4 of the value. What is the status of the contract?
a. Resclsslble b Unenforceable c. void a. Voidable

49. One of the stipulations contained In the contract between M Company and its employees is that the
company shall pay a bonus to employees of the company who shall continue its employment for at least
2 consecutive years, unless he quits or is discharged before the expiration of the period of 2 years.
x, an employee of the company was discharged without just cause, one week before the completion of the
two-year period.
a. x is not entitled to the bonus because his discharge was ln accordance with the contract
b. 83;' .§1L»°vm"-;8 ;*|*9 gogg because the employer's r1gnt to terminate ls superior than the right of
c. X' ls entitled to the bonus whether the discharge is with or without cause.
d. X'ls entitled to the bonus because the debtor company has vduntanly
' preventect the MPPGNDQ of
the condition
50. Statement No. 1: If one pany was mlstakm and the other acted fraudulently or lnequitably m sud# a
/7 way that the instrument does not state their true intention th f
of the instrument. ' e orm .
er m
3V ask or
f the an l nent
nu rr
The statement of a false cause in contracts shall render them vold, lf n should not be
No. 2:
proven that they were founded upon another cause which is true and lawful 2 iS :mn
| a tr b. Both fI c. NO. 1 is true, no. 2 is false » I
a re ue are ase d. No. I is false, No.