RFLIB 1
delivery of the thing sold. FALSE
Prelim Exam
1. By the contract of sale one of the
contracting parties obligates himself to
transfer the ownership of and to deliver a
determinate thing or indeterminate thing,
and the other to pay therefor a price
certain in money or its equivalent. FALSE
2. A contract of sale may be absolute
and/or conditional. FALSE
3. The contract of sale is Consensual
because it is perfected not only by
consent but with further act of the
contracting parties. FALSE
4. The contract of sale is Bilateral because
both the contracting parties are not
bound to fulfill correlative obligations
towards each other. FALSE
5. The contract of sale is Onerous because
the thing sold is conveyed even without
the consideration of the price and vice
versa. FALSE
6. The contract of sale is Commutative
because the thing sold is considered the
equivalent of the price paid and none
other. FALSE
7. The contract of sale is Nominate
because it is given an ordinary name or
designation in the Civil Code, namely,
“sale”. FALSE
8. The contract of sale is Principal because
it is dependent on the existence and
validity upon another contract. FALSE
9. Consent or meeting of the minds - refers
to the consent on the part of the seller to
transfer and deliver and on the part of
the buyer to pay although one of them
may not have the legal capacity to give
consent. FALSE
10. Object or subject matter - refers to the
determinate thing or indeterminate thing
which is the object of the contract.
11. Cause or consideration - refers to the
“price certain in money or its equivalent”
such as a check or a promissory note,
which is the consideration for the thing
sold, including goods or merchandise
with value. FALSE
12. A Contract of Sale is Absolute - where
the sale is subject to any condition and
where title passes to the buyer upon
13. A Contract of Sale is Conditional. - where
the sale contemplates a contingency and
in general, where the contract is not
subject to certain conditions, usually, in
the case of the vendee, the full payment
of the agreed purchase price and in the
case of the vendor, the fulfillment of
certain warranties. FALSE
14. The agreement is merely a contract to
sell, where the subject matter is not
determinate but the price is certain.
FALSE
15. The thing must be licit and the vendor
may not have a right to transfer the
ownership thereof at the time it is
delivered. FALSE
16. The object of a contract or the thing to be
sold may not always be within the
commerce of men. FALSE
17. If the subject matter of the sale is illicit,
the contract is voidable, thus can be
ratified. FALSE
18. In the Contract of Sale, it is required that
the vendor must have the right to transfer
ownership of the property sold at the
time of the perfection of the contract.
FALSE
19. A contract of sale entered into in violation
of a right of first refusal of another
person, is valid and cannot be rescinded.
FALSE
20. A thing is determinate although not
particularly designated or physically
segregated from all others of the same
class. FALSE
21. The requisite that a thing be determinate
is satisfied if at the time the contract is
entered into, the thing is capable of
being made determinate with the
necessity of a new or further agreement
between the parties. FALSE
22. Things having a potential existence
cannot be the object of the contract of
sale. FALSE
23. The sale of a thing not yet in existence
subject to the condition that the thing will
exist and on failure of the condition, the
contract is still valid. FALSE
24. The goods which form the subject of a
contract to sell may be either existing
goods, owned or possessed by the
 seller, or goods to be manufactured,
raised, or acquired by the seller after the
perfection of the contract of sale, in this
Title called “future goods.” FALSE
25. There may be a contract to sell of goods,
whose acquisition by the seller depends
upon a contingency which may or may
not happen. FALSE
PART II: MULTIPLE CHOICE
1. An agreement whereby one of the
parties (called the seller or vendor)
obligates himself to deliver something to
the other (called the buyer or purchaser
or vendee) who, on his part, binds
himself to pay therefor a sum of money
or its equivalent (known as the price).
5. The essential requisites of a contract of
a. Contract of Purchase and Sale
b. Contract of Sale
c. Both A and B
d. None of the above
4. I. In a contract of sale, not only does
each one of the parties assume a
correlative obligation, but each party
anticipates performance by the other
from the very start.
II. One of the characteristics of contract
of sale is Bilateral, where both the
contracting parties are bound to fulfill
correlative obligations towards each
other — the seller, to deliver and transfer
ownership of the thing sold and the
buyer, to pay the price.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
sale are:
a. Consent and object
b. Consent and cause;
c. Cause and object;
d. Consent, object and cause

2. I. Obligations are bilateral when both

parties are mutually bound to each other.
6. I. Natural elements or those which are
II. Obligations are reciprocal when the
deemed to exist in certain contracts, in
performance one is designed to be the
the absence of any contrary stipulations,
equivalent and the condition for the
like warranty against eviction or hidden
performance of the other.
defects.
a. First statement is not correct.
II. Accidental elements or those which
b. Second statement is correct.
may be present or absent depending on
c. Both statements are correct.
the stipulations of the parties, like
d. None of the above
conditions, interest, penalty, time or
place of payment, etc.
a. First statement is not correct.
3. I. In a contract of sale, in the absence of b. Second statement is correct.
any stipulation, the obligations of the c. Both statements are correct.
seller and buyer are reciprocal, the d. None of the above
obligation or promise of each party is the
cause or consideration for the obligation
or promise by the other.
7. I. There can be no sale without a price.
II. The reciprocal obligations would
II. A contract of sale is void and produces
normally be, in the case of the buyer, the
no effect whatsoever where the same is
payment of the agreed price and in the
without cause or consideration.
case of the seller, the fulfillment of
a. First statement is not correct.
certain express warranties.
b. Second statement is correct.
a. First statement is not correct.
c. Both statements are correct.
b. Second statement is correct.
d. None of the above
c. Both statements are correct.
d. None of the above
8. I. Non-payment of the purchase price is a
resolutory condition for which the remedy
is either rescission or specific
performance.
II. The failure to pay the price in full
within a fixed period does not, by itself,
dissolve a contract of sale in the
absence of any agreement that payment
on time is essential.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
9. I. A sale may be either; Absolute. —
where the sale is not subject to any
condition whatsoever and where title
passes to the buyer upon delivery of the
thing sold; or
II. Conditional. — where the sale
contemplates a contingency, and in
general, where the contract is subject to
certain conditions.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
10. I. In a contract of sale, title passes to the
buyer upon delivery of the thing sold,
II. In a contract to sell, (or of “exclusive
right and privilege to purchase”), where it
is stipulated that ownership in the thing
shall not pass to the purchaser until he
has fully paid the price.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
11. I. In a contract of sale, non-payment of
the price is a negative resolutory
condition, and the remedy of the seller is
to exact fulfillment or to rescind the
contract.
II. In a contract to sell, full payment is a
positive suspensive condition, the failure
of which is not a breach, casual or
serious, of the contract but simply an
event that prevents the obligation of the
vendor to convey title from acquiring
binding force.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
12. I. In a contract of sale, the vendor has
lost and cannot recover the ownership of
the thing sold and delivered, actually or
constructively, until and unless the
contract of sale itself is resolved and set
aside.
II. In a contract to sell, the title remains in
the vendor if the vendee does not
comply with the condition precedent of
making payment at the time specified in
the contract.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
13. I. The thing must be licit and the vendor
must have a right to transfer the
ownership thereof at the time it is
delivered.
II. The thing must be licit or illicit and the
vendor must have a right to transfer the
ownership thereof at the time it is
delivered.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
14. I. If the subject matter of the sale is illicit,
the contract is void and cannot,
therefore, be ratified.
II. If the subject matter of the sale is illicit,
the contract is still valid and can,
therefore, be ratified.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
15. I. The thing may be illicit per se (of its
nature) or per accidens (because of
 some provisions of law declaring it
illegal).
II. Decayed food unfit for consumption is
illicit per se, while lottery tickets are illicit
per accidens.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
16. I. A sale of land in violation of the
constitutional prohibition against the
transfer of lands to aliens, is void and the
seller or his heirs may recover the
property.
II. A land sold to an alien, who later sold
it to a Filipino, the sale to the latter
cannot be impugned.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
17. I. Seller must be owner or authorized by
owner of thing sold.
II. It is required that the vendor must
have the right to transfer ownership of
the property sold at the time of the
perfection of the contract.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
18. I. A contract of sale entered into in
violation of a right of first refusal of
another person, while valid is rescissible.
II. A contract of sale entered into in
violation of a right of first refusal of
another person, while valid is not
rescissible.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
19. I. A thing is determinate when it is
particularly designated or physically
segregated from all others of the same
class.
II. The object of a contract of sale must
be determinate is in accordance with the
general rule that the object of every
contract must be determinate as to its
kind.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
20. I. It is not necessary that the thing sold
must be in sight at the time the contract
is entered into.
II. It is sufficient that the thing is
determinable or capable of being made
determinate without the necessity of a
new or further agreement between the
parties
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
21. I. The goods which form the subject of a
contract of sale may be either existing
goods, owned or possessed by the
seller, or goods to be manufactured,
raised, or acquired by the seller after the
perfection of the contract of sale, in this
Title called “future goods.”
II. There may be a contract of sale of
goods, whose acquisition by the seller
depends upon a contingency which may
or may not happen.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
22. I. Goods which form the subject of a
contract of sale may be either: (1)
Existing goods or goods owned or
possessed by the seller; or
II. Future goods.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above

23. I. A sale of future goods, even though the
contract is in the form of a present sale,
is valid only as an executory contract to
be fulfilled by the acquisition and delivery
of the goods specified.
II. A sale of future goods, even though
the contract is in the form of a present
sale, is not valid as an executory
contract to be fulfilled by the acquisition
and delivery of the goods specified.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
24. I. The sole owner of a thing may sell an
undivided interest therein.
II. The sole owner of a thing may sell the
entire thing; or only a specific portion
thereof; or an undivided interest therein
and such interest may be designated as
an aliquot part of the whole.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
25. I. In emptio rei speratae, the future thing
is certain as to itself but uncertain as to
its quantity and quality.
II. In emptio spei (like the sale of a
sweepstake ticket), it is not certain that
the thing itself (winning a prize) will exist,
much less its quantity and quality.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
Midterms Exam PART I: TRUE OR FALSE
1. If the buyer becomes a co- owner, with
the seller, or other owners of the
remainder of the mass, it follows that the
whole mass is at the risk of all the parties
interested in it, in proportion to their
various holdings. True
2. Things subject to a resolutory condition
may be the object of the contract of sale.
True
3. A resolutory condition is an *1/1
uncertain event upon the happening of
which the obligation (or right) subject to it
is extinguished. True
4. By the contract for a piece of *1/1 work
the contractor binds himself to execute a
piece of work for the employer, in
consideration of a certain price or
compensation. True
5. By the contract of barter or exchange,
one of the parties binds himself to give
one thing in consideration of the other's
promise to give another thing. True
6. In a contract of sale, the vendor gives a
thing in consideration for a price in
money. True
7. As a general rule, the price fixed by a
third person designated by the parties is
binding upon them. True
8. If the third person designated by the
parties to fix the price refuses or cannot
fix it (without fault of the seller and the
buyer), the contract shall become
ineffective, as if no price had been
agreed upon unless, of course, the
parties subsequently agree upon the
price. True
9. Gross inadequacy of price does not
affect a contract of sale, except as it may
indicate a defect in the consent, or that
the parties really intended a donation or
some other act or contract. True
10. While a contract of sale is commutative,
mere inadequacy of the price or alleged
hardness of the bargain generally does
not affect its validity when both parties
are in a position to form an independent
judgment concerning the transaction.
True
11. A judicial or execution sale is one made
by a court with respect to the property of
a debtor for the satisfaction of his
indebtedness. True
12. If the price is simulated, the sale is void,
but the act may be shown to have been
in reality a donation, or some other act or
contract. True
13. If the contract is not shown to be a
donation or any other act or contract
transferring ownership because the
parties do not intend to be bound at all,
the ownership of the thing is not
transferred. True
14. The price of securities, grain, liquids, and
other things shall also be considered
certain, when the price fixed is that which
the thing sold would have on a definite
day, or in a particular exchange or
market, or when an amount is fixed
above or below the price on such day, or
in such exchange or market, provided
said amount be certain. True
15. The fixing of the price can never be left
to the discretion of one of the contracting
parties. However, if the price fixed by one
of the parties is accepted by the other,
the sale is perfected. True
16. The reasonable price or value of goods
is generally the market price at the time
and place fixed by the contract or by law
for the delivery of the goods. True
17. The contract of sale is perfected at the
moment there is a meeting of minds
upon the thing which is the object of the
contract and upon the price. True
18. The ownership is not transferred until the
delivery of the thing. True
19. Generally, a contract of sale is binding
regardless of its form. True
20. As a consensual contract, a contract of
sale becomes a binding and valid
contract upon the meeting of the minds
of the parties as to the price, despite the
manner of payment, or even the breach
of that manner of payment. True
21. A sale by auction is perfected when the
auctioneer announces its perfection by
the fall of the hammer, or in other
customary manner. Until such
announcement is made, any bidder may
retract his bid; and the auctioneer may
withdraw the goods from the sale unless
the auction has been announced to be
without reserve. True
22. The seller or his agent may bid in an
auction sale provided: (a) such right was
reserved; (b) notice was given that the
sale is subject to a right to bid on behalf
of the seller; and (c) the right to bid by
the seller is not prohibited by law or by
stipulation. True
23. The ownership of the thing sold shall be
transferred to the vendee upon the
actual or constructive delivery thereof.
True
24. The parties may stipulate that ownership
in the thing shall not pass to the
purchaser until he has fully paid the
price. True
25. A promise to buy and sell a determinate
thing for a price certain is reciprocally
demandable. True
26. An accepted unilateral promise to buy or
to sell a determinate thing for a price
certain is binding upon the promissor if
the promise is supported by a
consideration distinct from the price.
True
27. If the thing is lost before perfection, the
seller and not the one who intends to
purchase it bears the loss, in accordance
with the principle that the thing perishes
with the owner (res perit domino). True
28. If the thing is lost at the time of
perfection, the contract is void or
inexistent. True
29. If the thing is lost after perfection but
before its delivery, that is, even before
the ownership is transferred to the buyer,
the risk of loss is shifted to the buyer as
an exception to the rule of res perit
domino. True
30. If the thing is lost after delivery, the buyer
bears the risk of loss following the
general rule of res perit domino. True
31. In the contract of sale of goods by
description or by sample, the contract
may be rescinded if the bulk of the goods
delivered do not correspond with the
description or the sample, and if the
contract be by sample as well as by
description, it is not sufficient that the
bulk of goods correspond with the
sample if they do not also correspond
with the description. True
32. Whenever earnest money is given in a
contract of sale; it shall be considered as
part of the price and as proof of the
perfection of the contract. True
33. Earnest money is something of value
given by the buyer to the seller to show
that the buyer is really in earnest, and to
bind the bargain. It is actually a partial
payment of the purchase price and is
considered as proof of the perfection of
the contract. True
34. Since earnest money constitutes an
advance payment, it must be deducted
from the total price. True
35. Earnest money is given only where there
is already a sale, while option money
applies to a sale not yet perfected. True
36. When earnest money is given, the buyer
is bound to pay the balance, while the
would-be buyer who gives option money
is not required to buy. True
37. Option money may become earnest
money if the parties so agree. True
38. Subject to the provisions of the Statute of
Frauds and of any other applicable
statute, a contract of sale may be made
in writing, or by word of mouth, or partly
in writing and partly by word of mouth, or
may be inferred from the conduct of the
parties. True
39. As a general rule, a contract may be
entered into in any form provided all the
essential requisites for its validity are
present.
40. The expenses for the execution and
registration of the sale shall be borne by
the vendor, unless there is a stipulation
to the contrary. True
41. The expropriation of property for public
use is governed by special laws. True
42. As a general rule, all persons, whether
natural or juridical, who can bind
themselves have also legal capacity to
buy and sell. True
43. Generally, the contracts entered into by a
minor and other incapacitated persons
(e.g., insane or demented persons, deaf
mutes who do not know how to write),
are voidable. True
44. The husband and the wife cannot sell
property to each other. True
45. The husband cannot alienate or
encumber any real property of the
conjugal partnership without the wife's
consent. True
46. Compromise is a contract whereby the
parties, by reciprocal concessions, avoid
a litigation or put an end to one already
commenced. True
47. By renunciation, a creditor gratuitously
abandons his right against his debtor.
The other terms used by the law are
condonation and remission. True
48. If at the time the contract of sale is
perfected, the thing which is the object of
the contract has been entirely lost, the
contract shall be without any effect. True
49. The thing is lost when it perishes or goes
out of commerce or disappears in such a
way that its existence is unknown or it
cannot be recovered. True
50. The vendor is bound to transfer the
ownership of and deliver, as well as
warrant the thing which is the object of
the sale. True
PART 2: MULTIPLE CHOICE
1. Sale may be distinguished from an
agency to sell, as follows:
a. In a sale, the buyer receives the
goods as owner; in an agency to sell,
the agent receives the goods as the
goods of the principal who retains his
ownership over them and has the
right to fix the price and the terms of
the sale and receive the proceeds
less the agent's commission upon
the sales made;
b. In a sale, the buyer has to pay the
price; in an agency to sell, the agent
has simply to account for the
proceeds of the sale he may make
on the principal's behalf;
c. In a sale, the buyer, as a general
rule, cannot return the object sold; in
an agency to sell, the agent can
return the object in case he is unable
to sell the same to a third person;
d. All of the above
2. Sale distinguished from barter.
I. By the contract of barter or exchange,
one of the parties binds himself to give
one thing in consideration of the other's
promise to give another thing.
 II. A contract of sale, the vendor gives a
thing in consideration for a price in money.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
3. I. In sale, there is no preexisting credit,
while in dation in payment, there is.
II. In sale, obligations are created, while
in dation in payment, obligations are
extinguished.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
4. I. In a contract of sale, not only does
each one of the parties assume a
correlative obligation, but each party
anticipates performance by the other
from the very start.
II. One of the characteristics of contract
of sale is Bilateral, where both the
contracting parties are bound to fulfill
correlative obligations towards each
other the seller, to deliver and transfer
ownership of the thing sold and the
buyer, to pay the price.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
5. As a general rule, the price fixed by a
third person designated by the parties is
binding upon them. There are, however,
exceptions such as:
I. When the third person acts in bad faith
or by mistake as when the third person
fixed the price having in mind not the
thing which is the object of the sale, but
another analogous or similar thing in
which case the court may fix the price.
But mere error in judgment cannot serve
as a basis for impugning the price fixed;
II. When the third person disregards
specific instructions or the procedure
marked out by the parties or the data
given him, thereby fixing an arbitrary
price.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
6. Effect where price not fixed by third
person designated.
I. If the third person designated by the
parties to fix the price refuses or cannot
fix it (without fault of the seller and the
buyer), the contract shall become
ineffective, as if no price had been
agreed upon unless, of course, the
parties subsequently agree upon the
price.
II. If such third person is prevented from
fixing the price by the fault of the seller or
the buyer, the party not in fault may
obtain redress against the party in fault
which consists of a choice between
rescission or fulfillment, with damages in
either case. If the innocent party chooses
fulfillment, the court shall fix the price.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
7. I. There can be no sale without a price.
II. A contract of sale is void and produces
no effect whatsoever where the same is
without cause or consideration.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
8. Gross inadequacy of price does not
affect a contract of sale, except:
I. As it may indicate a defect in the
consent.
 II. That the parties really intended a
donation or some other act or contract.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
9. I. If the price is simulated or false such
as when the vendor really intended to
transfer the thing gratuitously, then the
sale is void but the contract shall be valid
as a donation.
II. If the contract is not shown to be a
donation or any other act or contract
transferring ownership because the
parties do not intend to be bound at all,
the ownership of the thing is not
transferred. The contract is void and
inexistent.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
10. I. The fixing of the price can never be left
to the discretion of one of the contracting
parties.
II. If the price fixed by one of the parties
is accepted by the other, the sale is
perfected.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
11. I. If the price cannot be determined in
accordance with Articles 1469 and 1472,
or in any other manner, and the bargain
is still executory, the contract is without
effect.
II. If the thing or any part thereof has
already been delivered and appropriated
by the buyer, the latter must pay a
reasonable price therefor.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
12. I. The contract of sale is perfected at the
moment there is a meeting of minds
upon the thing which is the object of the
contract and upon the price.
II. Both vendor and vendee, may
reciprocally demand performance,
subject to the provisions of the law
governing the form of contracts.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
13. I. The ownership is not transferred until
the delivery of the thing.
II. The vendor and vendee, may stipulate
that the ownership in the thing,
notwithstanding its delivery, shall not
pass to the purchaser until after he has
fully paid the purchase price thereof.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
14. I. As a consensual contract, a contract of
sale becomes a binding and valid
contract upon the meeting of the minds
of the parties as to the price, despite the
manner of payment, or even the breach
of that manner of payment. It is not the
act of payment of price that determines
the validity of a contract of sale.
II. Where the parties, however, still have
to meet and agree on how and when the
down payment and installment payments
are to be made, it cannot be said that a
contract of sale has been perfected.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
15. I. A contract of sale is null and void
where the purchase price, which appears
thereon as paid, has, in fact, never been
paid by the buyer to the seller. In such
case, the sale is without cause or
consideration.
II. If there is no meeting of the minds of
the parties as to the price, because the
price stipulated in the contract is
simulated, then the contract is void.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
16. I. The ownership of the thing sold shall
be transferred to the vendee upon the
actual or constructive delivery thereof.
II. The parties may stipulate that
ownership in the thing shall not pass to
the purchaser until he has fully paid the
price.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
17. I. A promise to buy and sell a
determinate thing for a price certain is
reciprocally demandable.
II. An accepted unilateral promise to buy
or to sell a determinate thing for a price
certain is binding upon the promissor if
the promise is supported by a
consideration distinct from the price.
a. First statement is not correct.
b. Second statement is correct.
c. Both statements are correct.
d. None of the above
18. I. As a general rule, a contract may be
entered into in any form provided all the
essential requisites for its validity are
present.
II. In case the contract of sale should be
covered by the Statute of Frauds, the law
requires that the agreement (or some
note or memorandum thereof) be in
writing subscribed by the party charged,
or by his agent; otherwise, the contract
cannot be enforced by action.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
19. Code, the following contracts must be in
writing; otherwise, they shall be
unenforceable by action:
I. Sale of personal property at a price not
less than P500.00; Sale of real property
or an interest therein regardless of the
price involved; and Sale of property not
to be performed within a year from the
date thereof regardless of the nature of
the property and the price involved.
II. The purpose of the Statute of Frauds
is to prevent fraud and perjury in the
enforcement of obligations depending for
their evidence upon the unassisted
memory of witnesses by requiring certain
enumerated contracts and transactions
to be evidenced in writing.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
20. I. The vendor of personal property
payable in installments may exercise any
of the following remedies: (1) elect
fulfillment upon the vendee's failure to
pay; or (2) cancel the sale, if the vendee
shall have failed to pay two or more
installments; or (3) foreclose the chattel
mortgage, if one has been constituted, if
the vendee shall have failed to pay two
or more installments.
II. The above-mentioned remedies are
alternative and are not to be exercised
cumulatively or successively and the
election of one is a waiver of the right to
resort to the others.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above

21. I. In sales of personal property by
installments or leases of personal
property with option to buy, the parties
may stipulate that the installments or
rents paid are not to be returned.
II. Such a stipulation is valid "insofar as
the same may not be unconscionable
under the circumstances"; otherwise, the
court has the power to order the return of
a portion of the total amount paid in
installments or rents.
25. I. Necessaries are those things which are
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
22. I. The vendor has the duty to pay not
only the expenses for the execution of
the sale but also for the registration of
the same in the absence of any
agreement between the parties to the
contrary.
II. Expenses incurred subsequent to the
transfer of title are to be borne by the
buyer, unless caused by the fault of the
seller.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
themselves have also legal capacity to
buy and sell.
II. There are exceptions to this rule in
those cases when the law determines
that a party suffers from either absolute
or relative incapacity.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above
needed for sustenance, dwelling,
clothing, medical attendance, education
and transportation according to the
financial capacity of the family of the
incapacitated person.
II. Generally, the contracts entered into
by a minor and other incapacitated
persons (e.g., insane or demented
persons, deafmutes who do not know
how to write), are voidable.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above

23. I. The procedure for the L exercise of the

power of eminent domain is provided for
in Rule 67 of the Rules of Court.
II. Expropriation must be decreed by
competent authority and for public use
and always upon payment of just
compensation.
a. First statement is correct.
b. Second statement is not correct.
c. Both statements are correct.
d. None of the above

24. I. As a general rule, all persons, whether

natural or juridical, who can bind