F. 1.

A vendor who cannot eject squatters from the the law between parties
It should be the vendee property as agreed in the deed may rescind and the court cannot
who should make the the contract. interfere.
rescission. F. 14. Relativity of contracts means that contract
T 2. A lessor may file a collection case against a Mutuality of contracts. binds both contracting parties.
widow pursuant to an apartment lease T 15. Consent is manifested by the concurrence of
contract signed by the widow and her the other and acceptance upon the subject
deceased husband. matter and cause.
F. 3. The different stages of a contract are: T 16. In contracts of correspondence, consent
Consummation, instead preparation, perfection, and signing. exists as soon as offeror learns of the
of signing.. acceptance by offeree.
F. 4. A real contract, delivery of subject is required F. 17. If the offer is made through an agent, the offer
Delivery is required to to extinguish the obligation. Acceptance is is accepted from the time acceptance is
perfect contract. communicated to the communicated to the offeree.
F. 5. A contract is preparatory when it looks agent.
If it looks to the forward to other future transactions or past T 18. Business advertisements of things for sale
future/past transactions, transactions unknown to parties. are not definite offers, but mere invitations to
it is conditional. make an offer, unless contrary appears.
F. 6. In aleatory contracts, the benefit to each party F. 19. The advertiser is bound to accept the lowest
Not yet determined at is predetermined in advance. Not bound to accept, or highest bid.
the moment of except in case of
celebration of the judicial forclosure.
contract since it F. 20. An offer terminates upon the incapacity of the
depends upon the offerer even after the acceptance is
happening of uncertain Before acceptance is conveyed.
event. Thus charging conveyed.
the parties with the risk F. 21. Vices of consent that affects volition includes
of loss or gain. Incapacity is not incapacity, error and fraud.
T 7. 3 kinds of contracts by equivalence of included in vices of
prestations – gratuitous, onerous and consent.
remunatory T 22. Error or mistake is the inadvertent and
F. 8. The natural elements of a contract are those excusable disregard of a circumstance
Essential elements without which there is no contract. material to the contract.
F. 9. Formality prescribed by law/stipulation is an T 23. Fraud in the execution may give rise to an
Delivery and not essential element of a real contract. action for damages even if the fraud is only
formality is an essential incidental.
element of real contract. F. 24. In remunatory contracts, the cause is the
F 10. Since a partnership is consensual contract, in undertaking or promise of a thing by the other
Formalities under no case will non-compliance with formalities Onerous contract. party.
partnership must be invalidate the contract. F. 25. The statement of a false cause in contracts
followed shall render them void even if it can be
F. 11. Principle of liberty of contracts means that If it should not be proved that they were founded upon another
Consensuality of contracts are perfected by mere consent and proved. cause which is true and lawful.
contracts from that moment parties are bound. F. 26. In case of illegal causa, the innocent party
T. 12. Real contracts are not subject to the principle He may recover. may not recover what has given.
of consensuality of contracts. T 27. Reformation is the remedy wherein a written
F. 13. Generally, the court may relieve a party from instrument is made so as to express the real
Generally, contract is a contract.

QUIZ 3 1
 intention of the parties when some error has party had an
been committed. opportunity to know the
T 28. The intention prevails as between parties in facts, are not in
case conflicts exists between the words and themselves fraudulent.
intention of parties. T 45. Nemo auditor propriam turpitudinem allegans.
F 29. Contract is rescissible when the guardian’s T 46. In case the court decrees annulment of the
More than ¼ ward sufers lesion by less than ¼ of the value contract and the same was already
of the things which are the object thereof. performed, there must be mutual restitution.
F 30. The prescriptive period of the action for T 47. Where the contract is entirely illegal and both
From the date the rescission is counted from the date of parties are equally guilty, there may be no
contract was entered discovery. action by 1 against the other.
into F 48. Rescission is possible even if plaintiff is not
31. Contracts void ab initio may be invoked only The plaintiff must be able to return what he received under the
F by the parties, principal or subsidiary or their able to return what he is contract.
May include 3rd persons. privies. obliged to restore by
T 32. Relative nullity may be cured by confirmation reason of contract.
or prescription. F 49. When there is vice of consent, the contract is
T 33. Only contracts having all the essential Voidable rescissible.
requisites may be ratified. T 50. An absolutely stimulated contract is ab initio
T 34. The effects of ratification retroact to the time void and inexistent.
that the contract was entered into. T 51. Intent of the parties to the contract is deduced
F 35. All agreements for leasing/sale of RP or of an from the language employed by the parties.
interst therein are governed by Statute of F. 52. Inadequacy for the cause upon the contract
Longer period than 1 Frauds. Inadequacy only invalidates the same.
year invalidates if there has
T 36. Statute of Frauds does not determine been fraud, mistake or
credibility or weight of evidence. undue influence.
T 37. When a contract is ratified by 1 of the parties,
contract becomes valid and enforceable. T 53. Conesensual contracts are perfected by mere
T 38. If the agreement is not illegal per se, but consent.
merely prohibited, an aggrived party may still T 54. A stipulation in a contract expressly conferring
recover damages from the other. upon 1 party the right to cancel the contract
F 39. A verbal promise to put in writing a contract violates ‘mutuality of contracts’.
that is covered by Statute of Frauds is F 55. Fixing a period in the offer prevents its
Not covered. enforceable. revocation before acceptance by
T 40. The interpretation of obscure words or Offer may be withdrawn communicating the notice of withdrawal
stipulations must not favour the party causing any time before except when the option is founded upon
the obscurity. acceptance. separate consideration, as something paid or
T 41. Malice is essential to hold a 3rd person who promised.
induces another to violate his contract liable. F. 56. There is simulation if the disagreement
F. 42. The contract bettween a minor and a lunatic between the true and apparent will, or intent
Unenforceable is void. Both parties must bind is not by agreement __________exists only in
F. 43. Minors cannot give consent in all contracts. themselves. 1 of them.
Not all contracts. F. 57. Relative simulation makes the apparent
F 44. Usual exaggerations in trade are not contract void as between parties, but the
Usual exaggerations in fraudulent unless aggrived party is illiterate. Parties are bound by hidden contract is ____ the necessary
trade, when the other their apparent act. requisites.

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F. 58. Exceptionally, contracts may have as objects made by an expert ___ has relied due to the
No contract may be future things such as future inheritance. former’s special knowledge.
entered into upon future F 70. Vices of consent consist in circumstances
inheritance. affecting adversely the decision of a party to
T 59. Absence of causa renders the contract non- Voidable only. enter into a contract makes the contract void.
existent. T 71. A stipulation pour autrui must be accepted to
F. 60. Existence of a motive may supply want of be valid.
Motive may be regarded causa if the motive as purpose or end of the T 72. A stipulation pour autrui is an exception to the
as the cause of the contract is legitimate. rule on relativity of contracts.
contract if it is founded F 73. Exceptionally, strictly personal rights may be
upon a fraudulent They cannot. object of contracts.
purpose to prejudice a T 74. In a phone conversation, X agreed to buy
3rd person. house and lot of Y for 5M to be paid on or
F 61. The contract is void if the inadequacy of before __________ that the deed of sale will
Rescissible contract. cause is shown to consist in lesion by more be executed and signed on or before the
than ¼ entered into by guardians or same date. The agreement to ____
representatives in behalf of the unenforceable.
wards/absentees. F. 75. A contract between a minor and an insane is
Unenforceable void.
F 76. Restitution is not possible if the object of the
It is possible under contract is service.
1398.
F 62. Where both parties are guilty, there may be
no action by 1 against the other, except where Enumeration
Guilty party has no right one of the parties to the contract is incapable  9 badges of fraud (7 lang sa codal)
to bring action. of giving consent. o Fictitious or inadequate consideration of conveyance
F. 63. The party who has brought an action to o Transfer made by debtor after suit has began and while it is
enforce the instrument may subsequently ask pending against him
He cannot subsequently for its reformation in court. o Sale upon credit by an insolvent debtor
ask for its reformation.
o Evidence of large indebtedness or complete insolvency
T 64. A and B signed a contract of lease over a
o Transfer of all/nearly of his property by debtor
parcel of land although their agreement was
o Transfer between father and son
one of the sale and ____ actually the
purchase price. In all instances, true intention o Failure of vendee to take exclusive possession of all the
must prevail. property
T 65. A contract of Antichresis is a solemn contract.  Badges of fraud (from the net)
F. 66. A contract of loan stipulating an interest rate o (1) The transfer was to an insider.
of 20% a month is void if not in writing. o (2) The debtor retained possession or control of the property
Contract is valid but no transferred.
interest shall be due. o (3) The transfer was disclosed or concealed.
T 67. Essential requisites include delivery in real o (4) Before the transfer was made, the debtor had been sued or
contracts and required formality in solemn threatened with suit.
contracts. o (5) The transfer was of substantially all the debtor's assets.
T 68. Dolo causante gives rise to an action for o (6) The debtor absconded.
damages while dolo incidente may annul the o (7) The debtor removed or concealed assets.
contract. o (8) The value of the consideration received by the debtor was
T 69. Fraud as a vice of consent consists of not reasonably equivalent to the value of the asset transferred.
misrepresentation or concealment of a fact

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 o (9) The debtor was insolvent or became insolvent shortly after
the transfer was made.
o (10) The transfer occurred shortly before or shortly after a
substantial debt was incurred.
o (11) The debtor transferred the essential assets of the business
to a lienholder who transferred the assets to an insider of the
debtor.
 8 unenforceable contracts
o Entered into a name of another by 1 without or acting in excess
of authority
o Not comply w/ SoF
i. Agreement to be performed within a year after making
contract
ii. Special promise to answer for debt, default or
miscarriage of another
iii. Agreement made in consideration of promise to marry
iv. Agreement for sale of goods, chattels or things in
action at price not less than 500; exception: auction
when recorded sale in sales book
v. Agreement for lease of property for more than 1 year
& sale of real property regardless of price
vi. Representation as to credit of another
o Both parties are incapable of giving consent
 7 void contracts
a. Cause, object or purpose is contrary to law, morals, good
customs, public order or public policy;
b. Absolutely simulated or fictitious;
c. Cause or object did not exist at the time of the transaction;
d. Object is outside the commerce of men;
e. Contemplate an impossible service;
f. Intention of the parties relative to the principal object of the
contract cannot be ascertained;
g. Expressly prohibited or declared void by law
QUIZ 3
Enumeration
2. 7 requisites of legal compensation
a. Parties are principal creditors and debtors of each other
b. Both debts consist in the sum of money or of consumable
things of same kind and quality
c. Due and demandable
d. Liquidated
e. No retention or controversy commenced by 3rd person
3. 4 requisites of mora solvendi
a. Positive obligation
b. Demandable and liquidated
c. Delays for reasons imputable to him
d. Demand (j/ej)
4. 6 instances when consignation may be made w/o tender
a. Absent or unknown
b. Incapacitated to receive payment
c. Refuses w/o just cause
d. 2 or more persons claim the same right
e. Lost title
5. 5 examples of rescissible contract
a. Entered into guardians – whenever the wards whom they
represent suffer lesion by more than ¼ of the value of the
things which are the object thereof
b. Represent absentees – if the latter suffer lesion
c. Fraud of creditors – latter cannot collect the claims due
d. Litigation – entered into by defendant w/o knowledge and
approval of litigants or of competent judicial authority
e. Other contracts specially declared by law to be subject to
rescission
6. 5 requisites of payment by cession
a. 2 or more creditors
b. Insolvent debtor
c. Assignment
d. Involve all properties of debtor
e. Accepted by creditors
7. Requisites of dolo causante
a. Misrepresentation or concealment
b. Induced the consent of the other
4
 c. Fact is not true g. Expressly prohibited or declared void by law.
d. Aware of falsity
e. Relied on it w/o FN
f. Give consent because of it
g. Not committed by both – only 1
8. Contracts to be written in public instrument for public convenience
a. Donation of RP
b. Contract of partnership
c. Creation, transmission, modification or extinguishment of real
rights over RP; sales of RP or of an interest
d. Cession, repudation or renunciation of hereditary rights or CPG
e. Power to administer property More questions 2/2/17
f. Cession of actions or rights proceeding from an act appearing
in a public document  Fraud in execution gives rise to damages. → F.
9. Statute of frauds Annulment
a. By its terms is not to be performed w/in a year from the making  Warranty in sale is an accidental element. → F.
thereof
b. Answer for debt, default, or miscarriage of another Natural element.
c. Consideration of marriage, other than mutual promise to marry  In contracts of correspondence, consent exists as
d. Sale of goods, chattel, or things in action, at a price not les soon as offeror learns of the acceptance by offeree.
than 500 (UNL buyer accept and receive)
e. Leasing for a longer period than 1 year or for sale of RP or → F ? Check code of commerce not sure.
interest therein o Commercial contracts are consensual.
f. Representation as to credit of a 3rd p i. EXC: Code of commerce requires
10. Badges of frauds
a. Fictitious or inadequate consideration of conveyance specific forms → charter and loans on
b. Transfer made by debtor after suit has began and while it is bottomry and respondentia
pending against him o Code of Commerce – follows manifestation
c. Sale upon credit by an insolvent debtor
d. Evidence of large indebtedness or complete insolvency theory
e. Transfer of all/nearly of his property by debtor o NCC – from the time it came to his knowledge
f. Transfer between father and son
g. Failure of vendee to take exclusive possession of all the  Deposit, pledge, commodatum are real contracts. → T
property  Causal fraud gives rise to action for damages while
11. Unenforceable contracts incidental fraud annuls the contract. → F. The other
a. Entered into a name of another by 1 without or acting in excess
of authority way around.
b. Not comply w/ SoF  Contract entered into by a lunatic has no effect. → F.
c. Both parties are incapable of giving May effect padin ata. Not in all cases void.
12. Void contracts
a. Cause, object or purpose is contrary to law, morals, good
customs, public order or public policy; Enumeration
b. Absolutely simulated or fictitious;  4 instances when reformation is not available
c. Cause or object did not exist at the time of the transaction;
d. Object is outside the commerce of men; (MEMAID)
e. Contemplate an impossible service;  7 rescissible contracts
f. Intention of the parties relative to the principal object of the
contract cannot be ascertained;
 5 difference – dacion and cession

QUIZ 3 5
  8 solemn contracts

QUIZ 3 6