CHAPTER I = NATURE AND FORM OF THE CONTRACT True or False ntract to Sell may not be considered as a Contract of Sale because the GEM essential element is lacking, y 2. In contract to sell, what the seller agrees or obliges himself to do is to fulfill his promise to sell the subject property when the entire amount of the purchase price is delivered to him, couse 3, In general, the objet is the why of the contract or the essential reason which _< __ moves the contracting parties to enter into the contract. \ 4, For the cause to be valid, it must be lawful such that it is not contrary to law, morals, good customs, public order or public policy. E 5. Acontract of sale is a consensual contract, thus, is perfected by deh. Beet T . Acontract of sale is perfected by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract. “7, Sale by itself does not transfer or affect ownership; the most that sale does is to create the obligation to transfer ownership. T 8. The perfection of a contract of sale should not, however, be confused with its consummation. In relation to the acquisition and transfer of ownership, it should be noted that sale is not a mode, but merely a title. ‘T 9. The object of every contract must be determinate as to its kind. “{ 10. The fact that the quantity in contract of sale is not determinate shall not be an obstacle to the existence of the contract, provided it is possible to determine the same, without the need of a new contract between the parties. Partll “[_ 1. Acontract for a piece of work, labor and materials may be distinguished from a contract of sale by the inquiry as to whether the thing transferred is one not in existence and which would never have existed but for the order of the person desiring it. In such case, the contract is one for a piece of work, not a sale. T 2. If the thing subject of the contract would have existed and been the subject ofa sale to some other person even if the order had not been given, then the contract is one of sale. T__ 3. Things having a potential existence may be the object of the contract of sale. T 4. The sale ofa vain hope or expectancy is voidable. descratign 5. The fixing of the price can never be left to the decision of one of the contracting parties. But a price fixed by one of the contracting parties, if accepted by the other, gives rise to a perfected sale. ‘—6. The parties need net agree on the manner of payment of the price of the property to give rise to a binding and enforceable contract of sale or contract to sell. 7. Acontract of sale is classified as a consensual contract, which means that the sale is perfected by mere consent. A is required for its validity, e ne ~ Tor Fatn mds Acontract of sale is normally commutative but+ot onerous. 4 51CHAPTER I - NATURE AND FORM OF THE CONTRACT 9. In dation in payment, the undertaking really partakes in one sense of the nature of barter, E 10. The thing must be licit and the vendor must have a right to transfer the ownership thereof at the time of byfectian, ele Multiple Choice Partl 1, Itis manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the agreement. A. Determinate subject matter (B Consent or meeting of the minds Policitacion D. Price certain in money or its equivalent 2. Asold to B orally a parcel of land for 300,000. Delivery and payment were to ‘be made after six months. When the said date arrived, A refused to deliver the land. Can B compel A to deliver? A. Yes, because the sale has been perfected. B. Yes, because there was an agreement. C. No, because the sale although valid is unenforceable. D. No, because the sale is void. 3. It is a continuing offer or contract by which the owner stipulates with another that the latter shall have the right to buy the property at a fixed price within a certain time, or under, or in compliance with, certain terms and conditions, or which gives to the owner of the Property the right to sell or demand a sale. ®) Option B. Earnest C. Absolute D. Conditional 4. It is also sometimes called an “unaccepted offer”. @® Option B. Earnest C. Absolute D. Conditional 5. 0 a sale of property but a sale of the right to purchase. Option «Earnest C. Absolute D. Conditional 6. It is simply a contract by which the owner of Property agrees with another person that he shall have the right to buy his Property at a fixed price within a certain time. Option B. Earnest © Absolute D. Conditional 52CHAPTER | - NATURE AND FORM OF THE CONTRACT 7. A special mode of payment where the debtor offers another thing to the creditor who accepts it as equivalent of payment of an outstanding debt. A. Application of payment B, Cession in payment Dation in payment . Tender of payment and consignation 8. In order that there be a valid dation in payment, the following are the requisites, except: ‘A. There must be the performance of the prestation in lieu of payment which may consist in the delivery of a corporeal thing or areal right or accredit against the third person B. There must be some difference between the prestation due and that which is given in substitution C. There must be an agreement between the creditor and debtor that the obligation is immediately extinguished by reason of the performance ofa prestation different from that due D. here must be performance of the obligation which is based on the liberality of the first party. 9, Sale Of aithing with potential existence. imptio rei speratae . Emptio spei C. Sale ofa present thing D. Void sale 10.Sale of mere hoperor expectancy that the thing will come to existence. Sale of the hope itself. Emptio rei speratae Emptio spei , Sale ofa future thing D. Unenforceable sale 11. 1. In contract of sale, the buyer receives the goods as owner. Il. Inagency to sell, the agent receives the goods as goods of the principal who retains his ownership over them. A. Only lis true Only Il is true Both are true D. Both are false 12. 1. Ifthe thing is specially done at the order of another, this is a contract of ~sale_ II. If the thing is manufactured or procured for the general market in the ordinary course of one's business, it | ntract for a piece of work. A. Only Lis true B. Only Ilis true Both are true D>\ Both are false 13. ifthe consideration of the contract consists partly in money, and partly in another thing, the transaction shalt ae TE A, ay Ate 2X eS) 53CHAPTER I - NATURE AND FORM OF THE CONTRACT IL In order that the price may be considered certain, it shall be sufficient that it be so with reference to another thing certain, or that the determination thereof be left to the judgment of a special person or persons. A. Only lis true ® Only lis true C. Both are true D. Both are false 14. One of the contracting parties obligates himself to transfer the ownership of, and to deliver, a determinate thing, and the other to pay therefor a price certain in money or its equivalent. Ay Barter 6) Sales Partnership D. Agency 15. S sold his only cat to B. Before delivery and payment, the cat gave birth to akitten. A. Bshould pay the fair market value of the kitten. B. Sis entitled to the fruit as he is the owner. Bis entitled to the kitten which was born after the perfection of the sale. D. Sin entitled to the fruit because it was born before delivery. 16. The essential elements of a contract of sale are, except: A. Consent or meeting of the minds B. Determinate subject matter C. Written contract D. Price certain in money or its equivalent 17. The stages of a contract of sale are the following, except: A. Negotiation Counter-offer C. Perfection D. Consummation 18. S offered in writing to sell his house and lot for 1,000,000 to B on January 20,2021. B requested to give him one month to raise the amount. On January 25, 2021, S informed B that he has raised the Price to 1,200,000. Can B compel S to accept the payment to 1,000,000 for the sale of the house and lot? A. No, because the seller can unilaterally fix the selling Price. B. Yes, because the original offer is binding ons. C. No, because there is as yet no perfected sale. D. Yes, because of the principle of mutuality of contract. 19. Until acceptance, it is not, Properly speaking, a contract, and does not vest, transfer, or agree to transfer, any title to, or any interest or rightin the subject matter, but is merely a contract by which the owner of property gives the optionee the right or privilege of accepting the offer and buying the pro on certain terms. ae co Option B. EarnestCHAPTER I = NATURE AND FORM OF THE CONTRACT G. Absolute D. Conditional 20, What is the test in determining whether it is a “contract of sale or a mere option”? Whether or not the agreement is valid. Whether or not the agreement could be specifically enforced. , Whether or not the agreement is not rescissible. D. Whether or not the agteement is covered by Statute of Frauds. 21, It shall be considered as part of the price and as proof of the perfection of the contract. A. Option money B. Initial payment ¢. Down payment Earnest money 22. I€onstitutes an advance payment and must, therefore, be deducted from the total price. A. Option money B. Initial payment . Down payment orn money 23.1sgiven by the buyer to the seller to bind the bargain. A. Option money B. Initial payment ‘C_ Down payment Earnest money 24. I. There may be a contract of sale of goods, whose acquisition by the seller depends upon a contingency which may or may nothappen. | IL The sole owner of a thing may sell an undivided interest therein. A. Only Lis true B. Only lis true © Both are true D. Both are false 25. |. In the case of fungible goods, there may be a sale of an undivided share of a specific mass, though the seller purports to sell and the buyer to buy a definite number, weight or measure of the goods in the mass; and though the number, weight or measure of the goods in the mass is undetermined. Il. Things subject to a resolutory condition may be the object of the contract of sale. A. Only lis true B. Only Ilis true Both are true D. Both are false Part il 1.1. An agreement on the price but a disagreement on the manner of its payment will not result in consent, thus, preventing the existence of a valid contract for lack of cause or consideration. 55CHAPTER I = NATURE AND FORM OF THE CONTRACT Il. One of the three essential requisites of a valid contract is consent of the parties on the object and cause of the contract. In a contract of sale, the parties must agree not only on the price, but also on the manner of /) payment of the price. A. Only Lis true Only His true Both are true i. Both are false 2.1. 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. IL The fixing of the price can be left to the discretion of one of the contracting parties. A. Only lis true Only His true @© both are true D. Both are false 3. 1. Ifthe thing or any part thereof has been, {9nd appropriated by the buyer, he must pay. ined nih a Il. In general, a perfected contract of salen be challenged on the ground of the seller's non-ownership of the thing sold at the time of the perfection of the contract. A. Onlylis true B. Only Ilistrue Both are true Both are false 4. Ina contract of sale, the non-payment of the price is 2 aS condition which extinguishes the transaction that, for a time existed, and discharges the obligations created thereunder. IL. The ownership of the thing sold shall yf be transferred to the vendee upon the actual or constructive delivery thereof, A. Onlyllis true B. Only lis true C_ Both are true Both are false 5. |. The parties in a-contract of sale may stipulate that ownership in the thing shall not pass to the purchaser until he has fully paid the price. II. Payment of the purchase price is essential to the transfer of ownership as Jong as the property sold has been delivered. A. Only lis true Only Il is true ~ Both are true D. Both are false 6. |. For an option contract to be valid and enforceable against the Promissor, | there must be a separate and distinct consideration that supports it. | 56CHAPTER I ~ NATURE AND FORM OF THE CONTRACT ML. “An accepted unilateral promise" can only have a binding effect if supported by a consideration, which means that the option can still be withdrawn, even if accepted, if the same is not supported by any consideration, A. Only Lis true B. Only IHis true Both are true D. Both are false 7.1. The consideration contemplated to support an option Ue Ady be monetary. IL, Without consideration that is separate and distinct from the purchase price, an option contract cannot be enforced. Only Lis true CB.) Only iis true C Both are true D. Both are false 8, Whena small quantity is exhibited by theselleras a fair specimen of the bulk, which is not present and there is no opportunity to inspect or examine the same. A. Sale or return B. Sale on approval ©) Sale by sample D- Sale by description 9. Where "a seller sells things as_being of a particular kind, the-buyer not knowing whether the seller’s representations are trie or false, but relying on them as true; or as otherwise stated, where the buyer has not seen the article sold and relies on the description given to him by the seller, or has seen the goods, but the want of identity is not apparent on inspection." A. Sale or return B. Sale on approval C.__ Sale by sample ale by description 10. 1. Whether a sale is by sample or description depends upon the facts disclosing the intention of the parties. Il. A seller's description of the goods which is made part of the basis of the transaction creates a warranty that the goods will conform to that description, A. Only lis true B. Only Ilis true © Bothare true D. Both are false 11. In a contract of sale of personal property, the price of which is payable in installments, the vendor may exercise any of the following remedies, except: ‘A. Exact fulfillment of the obligation, should the vendee fail to pay: Cancel the sale, should the vendee's failure to pay cover any installment. 57CHAPTER I - NATURE AND FORM OF THE CONTRACT © Cancel the sale, should the vendee's failure to pay cover two or more installments. D. Foreclose the chattel mortgage on the thing sold, if one has been constituted, should the vendee's failure to pay cover two or more installments. 12. 1. The expenses for the execution and registration of the sale shall be borne by the vendor, unless there is a ‘stipulation to the contrary. IL. The seller of movables in installments, in case the buyer fails to Pay two or more installments may elect to pursue either of the following remedies: (1) exact fulfillment by the purchaser of the obligation; (2) cancel the sale; or (3) foreclose the mortgage on the purchased property if one was constituted thereon. It is now settled that the said remedies are cumulative and not alternative. A. Only listrue Only Il is true Both are true D. Both are false 13. The requisites of a valid price are the following, except: @) Itis not simulated. I. Itis certain. C._Inmoney or an equivalent thing. D. Manner of payment must be agreed upon. 14. I. The mere inadequacy of the price does not affect its validity when both Parties are in a position to form an independent judgment concerning the transaction. II. Mere alleged inadequacy of the price does not necessarily void a contract of sale, although the inadequacy may indicate that there was a defect in the consent, or that the parties really intended a donation, mortgage, or some other act or contract. A. Onlylistrue B._ Onlyllis true Both are true D. Both are false woo 15. | Ifthe price is simulated, the sale is Voidable, but the act. may be shown to have been in reality a donation, or some other act or contract, IL. If the real price is not stated in the contract, then the contract of sale is valid but subject to reformation, Only lis true Only Il is true C. Bothare true D. Bothare false 16. |. It is the act of payment Of price that determines the validity of a contract of sale. (0 Il. Payment of the price SHOW Mi Perfection of the contract. A. Only is true B. Only Il istrue C. Both are true 58CHAPTER I - NATURE AND FORM OF THE CONTRACT Both are false he manner of tof the purchase price 1s an essential element before a valid and binding contract of sale can exist, Hl Agreement on the manner of payment goes into the price such that a disagreement on the manner of payment is tantamountto a failure to agree on the price, A. Only Lis true B. Only Histrue Both are true D. Both are false 18. A bilateral contract whereby the prospective seller, while expressly reserving the ownership of the subject property despite delivery thereof to the prospective buyer, binds himself to sell the said property exclusively to the prospective buyer upon fulfillment of the condition agreed upon, that is, full payment of the purchase price, A. Absolute sale Conditional sale © Contract to sell Agency to sell In a conditional contract of sale, the first element of consent is present, although itis conditioned upon the happening of a contingent event which may or may not occur. Il. Ina contract to sell, upon the fulfillment of the suspensive condition which is the full payment of the purchase price, ownership will not automatically transfer to the buyer although the property may have been previously delivered to him. A. Only Tis true Only I is true €C) Both are true D. Bothare false 20. Acontract by virtue of which A, in consideration ofthe payment of a certain sum to B, acquires the privilege of buying from, or selling to, B certain properties within a limited time at a specified price. A. Contract of sale Contract to sell Option contract ). Conditional sale 21. Itis simply a contract by which the owner of property agrees with another person that he shall have the right to buy his property at a fixed price within a certain time. A. Contract of sale Contract to sell Option contract D. Conditional sale 22. An option is also sometimes called: Unaccepted offer B. Accepted bid 17, 19. 59I CHAPTER I - NATURE AND FORM OF THE CONTRACT C. Unaccepted bid D. Accepted offer 23, Audeposit pald)by @ prospective buyer to show a good-faith intention to complete the transaction, and ordinarily forfeited if the buyer defaults. Option money Earnest money C. Consideration D. Bid price 24, |, There must first be a perfected contract of sale before we can speak of earnest money, Ul, Earnest money applies to a perfected sale, Only lis true Only Il is true Both are true Both are false 25. Under the Statute of Frauds, the following contract of sale must be in writing to be enforceable, except: A. Sale of real property B. Sale of personal property at a price not less than PS00 C._ Sale of property not to be performed within a year from the date 7 ereof ‘ale of an interest in a partnership 60Singin tomer fn tetera of am Ay Lean Mauer BN 93. 0 —s———'172 1s —. CHAPTER II - CAPACITY TO BUY OR SELL ine a ic was agreed that A would fix the price a week P10, 000, B agreed. Was the sale A “The contract is perfected on January 5, when the ring is delivered by S oB, The contracts perfected on January 1, when the parties had a meeting cof minds onthe object and price. are ripened ai Corea pe BI se medical attendance education and transportation Cvenne: clothing Tener cep owe mater ari during marriage are prohibited. . 68 Ree CHAPTER III ~ CAPACITY TO BUY OR SELL © bothare true D, Bothare false 7.1. All persons, whether natural or juridical, who can bind themselves, have legal capacity to enter into a contract of sale. IL Where necessaries are those sold and delivered toa minor or other person ‘without capacity to act, he must pay a reasonable price therefor. A. Onlyllis true. © Theguardln the property ofthe person or he rn propery ftht pesonor pros who may bende D. Demented press 5. These cover eveything indispensable for sur medial attendance edvcaton and tansporation = ene Stn Mk Necessary expenser Uefa expenses Expense of preservation DONecessaries 6.1 The husband and wife cannot se p operty tone another as rule whi for pole consideration andthe dates of morally reauie ter oe prohibition apply to common-law relationships. =o IL The law emphatically prohibits the spouses fom ell other subject certain exceptions Slay, during marriage are prohibited. ° 1 Oni tistrve B Onbitistrve cries Ci ere ene 6a CHAPTER II ~ CAPACITY TO BUY OR SELL © sth aretrve D. Bothare fase 7.eAll persons, whether natural or juridical, who cn bind themseves, have Tena capacty to enter into contract sale 1 Where necessaries are those sold and delivered ta minor or other person ‘without espacty tact he must pay areasonable pice therefor. 1 Onlytistrue Only is rve © Bothare true : Both are ase 8.5 sells to Bat PSO per liter 300 liters of gasoline stored in his truck tank, ‘which unknown tothe partis contains S00 ters, Whats the status ofthe Contract of sae between Sand 8? "A The sale is void because the quantity avaiable is mare than the quantity sol The snes vad up to 500 Iters of gasoline. B must pay for the 2adional 200 ers The sales valid up to 300 ters of gasoline B becomes the owner of 37S ofthe whole stock while becomes the owner of2/5 thereot D. The sal is rescoble because wil suffer lesion of more than of thevalue ofthe whole stock 49, ese are the persons wh cannot enter into acontractofsale otherwise the ‘of sale is defective. q SiAbsoluteineapacty Relative incapacity C._ None of the above D. Allofthe above 410. A offered forsale to B 20 cavans of XYZ rice and fixed the price per cavan at 'P100 over the price offered at W's store in La Trinidad Public Market. The price is: "A. Not certain because the price at La Trinidad Public Market is not stated. B._ Certain because ithas got reference to another thing which is certain. C._ Certain because there isa price ceiling for price of rice. D._ Not certain so the court may fix the price. 11. One ofthe following is not included as an example of relative incapacity. ‘A. Husband and wife BL. The guardian the property of the person or persons who may be under his guardianship eafemutes who do not know how to write JAgents, the property whose administration or sale may have been ‘entrusted to them 12. One ofthe following is not included as an example of relative incapacity ‘A. Demented persons BL Executors and administrators, the property of the estate under administration 6 | ‘CHAPTER I] - CAPACITY TO BUY OR SELLC. The sale is valid up to 300 liters of gasoline. B becomes the owner of Jy sof the whale stock whl becomes the owner of 2/5 threo. . Thesnle in rescstble because $ wil sufer lesion of more than % of the vale ofthe wbole sock o. These ve the persons wh cannot enter Into aconractf sale otherwise the ex ofsale defective. Absolute incapacity B Relative napacty © None ofthe above D._Allorthe above to, pofierea fn slot 820 cavans of 17 ee and fied the price per cavan at eee once oeed at We store nia ended Public Market. The re Pen Not certain because the price at La Trinidad Public Market is not stated ty. Cat because thas got reference to another hing which certain. beta because there apie cellg for price of ice. D. Noteerainsothe court may x the pice 11. Ope the felwing snot included a an example of elatve incapacty ‘A Husband and wie {The wuadlan the property ofthe person or persons who maybe under his quardlanship GQ Deatrmutes who do not know how to write Hyena the property whose administration or sale may have been entrusted to them 12 ong ef the flowing isnot included as an example of relative ineapacty Demented persons Brceutors and administrators, the property of the estate under adinetraton 0 Nee ay CAPACITY TO BUY OR SELL Public ofMcers and. emplayees, the property of the stat oy itstaon fh Bens en rae uses, ages and oheroicers and employees connected wth Aninsratin of ite, the property in Hagaton before the cou, say shinaosjrteton the eneese tel especie anctons 3. The Chil Code prohibits lawyers Irom acquiring by purchase o assignment the property or rights involved which ae the abject of the gation In whlch hey intervene by viru of thelr profession. The i tenon ales ny ring pnd he sat | agaist sale of property between spouses, ‘to common law relationships. a ree Only liste % Oniyt ste Both are true Bath ar fale 14 The flowing persons cannot acauie by prchase, even at 3 pubic o ial aucion ether person or though he mediation of ante Irs drs precning are ders of perir and fer Executors and administrators tener Brothers and sisters D. The purdann (CHAPTER III - EFFECTS OF THE CONTRACT WHEN THE THING SOLD HAS BEEN LOST Multiple chotee 1: Where the parties purport asale of specie goods. and the goods without the Towed ofthe cll bev persed ipo ar have whl ora mate partso deteriorated in quality aso be substantially changed in character, the Buyer may ahs option teat the sae Uxsavolded: or IAs la fhe exsing gods o io much her as ave at eteriorate, anda binding the buyer to pay te agreed price fo the goods imvwhich the ownership wil pass, ithe ele war visible fees A Only tis true Only tis true Bothare true Both are alse 2. Lf the thing which is the object ofthe contract has been entirely lost atthe time of perfection sale, the contact shall be without any effect. The feason i because there isan absence of esentl element thatthe consent. 11-A things lost when it perishes or goes out of commerce oF disappears sucha way that ts existences unknown or tcannotbe recovered. A Onlytistrue © onlyitis tue © Bothare tue D. Rothare alse 3. Athingis lost when, excep: ‘A Teperishes Goes out of commerce © itis filly deprecated Dicanpears in sucha way that ts existence is unknown oritcannot be recovered ‘the ang should have been losin part onl at the time of perfection of sale the vendee may choose between: [Withdrawing from the contractor 1i,Damages ‘nly is true B. Onlyitistrue C. Bothare rue D. Bothare se so mar en are tne contract of sales perfected the ting which th bec wane contrat has been entirely lst the contract shal. ene eS cap 11 vrune thing should have been lost in part ony, the vendee may choose ‘between withdrawing from the contract or specific performance. A. Only lis true B. Only lis true . Both are true © Both are false B rr SS CHAPTER IV - OBLIGATIONS OF THE VENDOR