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OBLIGATIONS
1. If the debtor is in delay in delivering a specific thing which subsequently got lost due to fortuitous event, the debtor shall be
liable for the loss.
2. In case a passenger is injured due to the negligence of the taxi driver, the passenger may sue the taxi driver based on quasi-
delict. He may include the taxi operator in the suit based on the employer’s solidary liability for the acts of its employee.
3. In case a passenger is injured due to the negligence of the taxi driver, the passenger may sue the taxi operator based on
breach of contract of carriage. He may not include the taxi driver since a contract of carriage is only between the taxi
operator and the passenger.
4. In case a passenger is injured due to the negligence of the taxi driver, the passenger may sue the taxi driver based on delict.
He cannot include the taxi operator in the suit since only the actor can be charged criminally. But, the taxi operator is
subsidiarily liable in case the taxi driver is convicted and insolvent.
5. The diligence required of common carriers is extraordinary diligence, which is greater than the diligence of a good father of
a family.
6. While solidary debtors may be compelled to pay the share of an insolvent co-debtor, joint debtors may not be compelled to
do so.
7. In alternative obligations, the person entitled to choose cannot choose the things lost due to fortuitous event or due to the
fault of the one entitled to choose.
8. In alternative obligations, once the choice is made, the obligation becomes pure and demandable.
9. In facultative obligations, whatever happens to the thing substituted after substitution does not affect the substituting
obligation.
10. In facultative obligations, the choice to substitute always belong to the debtor.
11. Solidarity does not mean indivisibility. Neither does indivisibility mean solidarity.
12. In case two debtors are obliged to deliver an indivisible thing (e.g. car), if one refuses to perform, the obligation to deliver
shall be converted into an obligation to pay the value of the undelivered car where only the refusing debtor is liable for
damages and the debtor willing to perform paying for his share in the obligation (without damages) had it been properly
performed.
13. In dacion en pago, if the property given in exchange is valued less than the monetary obligation, the extinguishment shall
only be partial and up to the extent of the value of the property, unless the conduct of the parties or a stipulation provides
that the exchange is in consideration of the total extinguishment of the obligation.
14. In dacion en pago, if the property given in exchange is lost by the creditor through eviction, the original obligation shall be
revived, and the accessory obligation shall remain extinguished.
15. In payment by cession, ownership over the debtor’s property is not transferred to the creditors. The extinguishment is only
up to the extent of the proceeds of the sale of ceded properties.
16. Compensation is only available when both debts are in money or to deliver consumable things.
17. A third person who pays the debt of a debtor without the debtor’s knowledge and consent, cannot be subrogated to the
rights of the creditor and is only entitled to reimbursement up to the extent beneficial to the debtor. This strict rule ensures
that third persons are more careful in paying debts of other persons and protecting debtors from being liable for more than
what they actually owe.
18. Remission, being gratuitous in nature, must observe the formalities required of donations.
19. If a father loans his son an amount and donates the same credit to his son, the obligation to pay the loan is extinguished by
merger or confusion. Same effect happens if the father dies and leaves the son as his only heir.
20. When a debtor promised to deliver a determinate thing to each of two persons, the debtor will be liable to the creditors in
case of loss of said thing even if it is due to fortuitous event.

CONTRACTS
21. Love and affection, though not valuable consideration, is still a consideration that can complete the requisites of a valid
contract like donation.
22. Obligatoriness refers to the force and effect of contract as law between the contracting parties.
23. Relativity of contracts refers to the binding effect of a contract to its contracting parties, their heirs, and assigns.
24. Mutuality of contracts refers to the equality of standing of contracting parties in a contract.
25. Autonomy of contracts refers to the freedom of the contracting parties to agree to any term or condition provided it is not
contrary to law, public policy, good morals, and good customs.
26. The Philippines follows the Cognition Theory (when the acceptance comes to the knowledge of the offeror) when it comes
to perfection of contracts.
27. Before an offer is accepted, it may be withdrawn by the offeror, except if there is consideration given in order for the
offeree to decide on the offer.
28. When an offeror is convicted for a crime which is punishable by imprisonment of at least reclusion temporal, the offer is
considered withdrawn because civil interdiction is deemed imposed with the prison sentence.
29. Stipulations in favor of third persons only bind the third persons upon their acceptance. Prior to said acceptance, contracting
parties may withdraw said stipulations.
30. In case a minor enters into a contract, the other contracting party, who is capacitated, cannot seek the annulment of the
voidable contract.
31. If the lesion or damage suffered by a minor, ward, or absentee in a contract entered into by the guardian or representative is
exactly 25% of the property, the contract is valid. It must be more than 25% to be rescissible.
32. An action for rescission is a subsidiary remedy or a remedy of last resort.
33. Unenforceable contracts may be ratified by partial performance no matter how small since such performance is deemed an
admission to the existence of said contract.

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34. For an oral sale of chattel to be enforceable, the price of the chattel sold must be less than P500. If the price is exactly P500,
such sale of chattel must be in writing to be enforceable.
35. A minor who entered into a contract cannot ratify said voidable contract during his minority. Only his or her guardian can
ratify said contract. Once he or she reaches the age of majority, his or her guardian cannot ratify said contract anymore.
36. The prescriptive period to annul a voidable contract is 4 years.
37. A contract entered into by two persons legally incapacitated to enter into a contract is unenforceable; but those entered into
by two persons whose consents are both vitiated are voidable.
38. Void contracts are imprescriptible and not capable of being ratified.
39. When contracting parties are in pari delicto, the law leaves where they are. They cannot go to courts to enforce the contract.
40. A sale of shabu is void even if the document is couched as a sale of baby powder. A sale of baby powder is valid even if the
document is couched as a sale of shabu. It is the parties’ intention that prevails.

SALES
41. A sale of future inheritance is void.
42. An oral sale of large cattle is void.
43. A deed of sale where the consideration had not in fact been paid is a void contract of sale.
44. Inadequacy of price does not invalidate a sale unless such inadequacy is so gross that it is unconscionable or shocking to the
senses of men or to the judicial sensibilities of the court.
45. While a contract of sale is void since it has no valuable consideration, it may be some other valid contract like a donation.
46. Failure to pay the consideration is different from lack of consideration. The first only results to breach of contract of sale,
while the latter voids a contract of sale.
47. In the absence of a principal contract of loan, no contract of sale can be construed as an equitable mortgage.
48. A contract of sale of necessaries entered into by a minor is valid.
49. Married couples who are legally separated may enter into a contract of sale.
50. An unpaid seller can no longer exercise his or her right of stoppage in transitu if the goods have already been received by
the buyer or its agent.
51. When an unpaid seller exercises his or her right of resale, the buyer shall be liable for any deficiency. But in case of profit,
it shall inure to the benefit of the unpaid seller.
52. In case of foreclosure of chattel mortgage over a personal property bought in installments, recovery of deficiency is not
allowed. In case of excess, it shall belong to the mortgagor unless there is a stipulation to the contrary.
53. If the redemption period is “after 10 years from date of sale”, it is a void stipulation and considered as if not written. Hence,
the period shall be 4 years.
54. The right of redemption of a co-owner defeats the pre-emptive right of an adjacent landowner.

CREDIT TRANSACTIONS
55. A contract of pledge is generally indivisible, hence partial payment does not lead to proportionate extinguishment of the
pledge.
56. In legal pledge, the excess in the sale proceeds shall belong to the legal pledgor and the legal pledgee shall be entitled to
recover in case of deficiency.
57. While a real estate mortgage requires registration in order to be valid, an unregistered real estate mortgage is binding
between the contracting parties.
58. In judicial foreclosure of real estate mortgage, there is right of redemption and equity of redemption.
59. In chattel mortgage, there is equity of redemption which must be exercised before the foreclosure sale.
60. A chattel mortgage over a house is valid.

BP 22
61. A check that was dishonored due to closed account is also a check dishonored due to insufficient of funds. If a check was
dishonored due to a stop payment order, the drawee-bank is obliged to explicitly state in the notice of dishonor whether or
not there are sufficient funds had there been no stop payment order.
62. The making, drawing and issuance of a check payment of which is refused by the drawee because of insufficient funds in or
credit with such bank, when presented within ninety (90) days from the date of the check, shall be prima facie evidence of
knowledge of such insufficiency of funds or credit unless such maker or drawer pays the holder thereof the amount due
thereon, or makes arrangements for payment in full by the drawee of such check within (5) banking days after receiving
notice that such check has not been paid by the drawee.
63. In a sale by approval, the crimes committed when upon the issuance of check for payment subsequently bounces, are BP 22
and estafa
64. Simultaneous filing of BP 22 and estafa cases does not amount to double jeopardy.

CONSUMER PROTECTION
65. Products must not be sold at higher prices than those stated in the price tag.
66. The Lemon Law covers only brand-new motor vehicles.
67. The Lemon Law specifically excludes motorcycles, delivery trucks, dump trucks, buses, lawn mowers, heavy equipment,
and farm equipment.
68. The Lemon Law covers those irreparable nonconformities which substantially impair the use, value, or safety of these new
vehicles and prevent such motor vehicles from conforming to the manufacturers’ or distributors’ standards or specifications.

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69. The consumer may invoke his rights under the Lemon Law within the Coverage Period which is 12 months from the date of
the delivery of the motor vehicle, or for as long as the motor vehicle has not run more than 20,000 km after such delivery,
whichever comes first.
70. The consumer must have had the affected motor vehicle brought in for repair with the Seller at least four separate times for
the same complaint, and for all those times, the nonconformity remains unresolved.

FINANCIAL REHABILITATION AND INSOLVENCY

71. Three (3) or more creditors the aggregate of whose claims is at least either Php1,000,000.00 or at least 25% of the
subscribed capital stock or partner’s contributions of the debtor, whichever is higher, may apply for and seek the liquidation
of an insolvent debtor by filing a petition for liquidation of the debtor with the court.
72. Cram down power refers to the power of the rehabilitation court to approve a rehabilitation plan even over the opposition of
the creditors holding a majority of the corporation’s total liabilities if there is a showing that rehabilitation is feasible, and
the opposition of the creditors is manifestly unreasonable.
73. Suspension of payments can only be availed by individual debtors.
74. Commencement order refers to the order issued by rehabilitation court if the court finds the petition for rehabilitation to be
sufficient in form and substance.
75. Stay or Suspension Order shall refer to an order issued in conjunction with the commencement order that shall suspend all
actions or proceedings, in court or otherwise, for the enforcement of claims against the debtor; suspend all actions to
enforce any judgment, attachment or other provisional remedies against the debtor; prohibit the debtor from selling,
encumbering, transferring or disposing in any manner any of its properties except in the ordinary course of business; and
prohibit the debtor from making any payment of its liabilities outstanding as of the commencement date.

PHILIPPINE COMPETITION ACT

76. This Philippine Competition Act does not apply to the combinations or activities of workers or employees nor to
agreements or arrangements with their employers when such combinations, activities, agreements, or arrangements are
designed solely to facilitate collective bargaining in respect of conditions of employment.
77. Parties to the merger or acquisition agreement wherein the value of the transaction exceeds the threshold are prohibited
from consummating their agreement until thirty (30) days after providing notification to the Philippine Competition
Commission (PCC).
78. When the PCC requests further information that are reasonably necessary and directly relevant to the prohibited merger or
acquisition, it has the effect of extending the period within which the agreement may not be consummated for an additional
sixty (60) days, beginning on the day after the request for information is received by the parties.
79. When the above periods of review have expired and no decision has been promulgated for whatever reason, the merger or
acquisition shall be deemed approved and the parties may proceed to implement or consummate it.
80. Merger or acquisition agreements that substantially prevent, restrict or lessen competition in the relevant market or in the
market for goods or services as may be determined by the PCC shall be prohibited.
81. The acquisition of the stock or other share capital of one or more corporations solely for investment and not used for voting
or exercising control and not to otherwise bring about, or attempt to bring about the prevention, restriction, or lessening of
competition in the relevant market is not prohibited.
82. An agreement consummated in violation of the requirement to notify the PCC on covered mergers and acquisitions shall be
considered void and subject the parties to an administrative fine of one percent (1%) to five percent (5%) of the value of the
transaction.
83. Beginning March 1, 2023, mergers and acquisitions that breach a Size of Party (SoP) of P7 billion and a Size of Transaction
(SoT) of P2.9 billion will have to be notified to the PCC for mandatory merger review.

GOVERNMENT PROCUREMENT LAW

84. The Government Procurement Law applies to the Procurement of Infrastructure Projects, Goods, and Consulting Services,
regardless of source of funds, whether local or foreign, by all branches and instrumentalities of government, its
departments, offices and agencies, including government-owned and/or -controlled corporations and local government
units.
85. Competitive Bidding refers to a method of procurement which is open to participation by any interested party and which
consists of the following processes: advertisement, pre-bid conference, eligibility screening of prospective bidders, receipt
and opening of bids, evaluation of bids, post-qualification, and award of contract.
86. In the preparation of bidding documents, reference to brand names is not be allowed.
87. A prospective bidder may be allowed to submit his eligibility requirements electronically. However, said bidder shall later
on certify under oath as to correctness of the statements made and the completeness and authenticity of the documents
submitted.
88. A bidder may modify his bid, provided that this is done before the deadline for the receipt of bids.
89. A bidder who has withdrawn his bid cannot submit another bid for the same contract either directly or indirectly.
90. Post-qualification is the stage where the bidder with the Lowest Calculated Bid, in the case of Goods and Infrastructure
Projects, or the Highest Rated Bid, in the case of Consulting Services, undergoes verification and validation whether he has
passed all the requirements and conditions as specified in the Bidding Documents.
91. In case of failure of bidding, the contract shall be re-advertised and re-bid. After the second failed bidding, the BAC may
resort to negotiated procurement.
92. All bidding documents shall be accompanied by a sworn affidavit of the bidder that he or she or any officer of their
corporation is not related to the Head of the Procuring Entity by consanguinity or affinity up to the 3rd civil degree. Failure
to comply shall be a ground for the automatic disqualification of the bid.

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PARTNERSHIPS
93. A partnership has a separate and distinct personality of its own apart from the partners constituting it.
94. An assignee of partnership interest does not become a partner until and after the acceptance of all the other partners.
95. A partnership for a particular undertaking is automatically dissolved upon fulfilment of said undertaking.
96. An illegal partnership does not need a judicial proceeding in order to be dissolved. It is void from the beginning.
97. When a general partner dies, the partnership whether general or limited, is dissolved. But when a limited partner dies, the
limited partnership remains as long as there is at least one limited partner remaining.
98. Partners in a partnership are mutual agents of another.
99. When there are immovable properties contributed, there must be an inventory and the public instrument must be executed.
Otherwise, the partnership is void.
100. Non-registration of the partnership, when required, does not invalidate the partnership.
101. An industrial partner cannot be liable for additional capital contributions if needed by the partnership.
102. If a capitalist partner refuses to contribute additional capital when needed, his or her interest may be bought out by the
other partners willing to contribute additional capital.
103. A partner who is admitted to the partnership is liable for obligations incurred by the partnership prior to his or her
admission but only up to the extent of his contribution, unless there is a stipulation to the contrary.
104. A managing partner whose credit against a debtor is more onerous to the debtor than the debtor’s debt to the
partnership, may apply the entire payment made by the debtor in his name, should the debtor elect his right to apply it
wholly to his debt to the managing partner.
105. When an industrial partner engages in any other business, he may be excluded from the partnership, but a capitalist
partner who engages in the same business, may only be made to account for the profits earned.
106. While an industrial partner cannot be made liable for any losses, he may be held liable for partnership debts to
partnership creditors with right of reimbursement from the capitalist partners.
107. The non-filing of the certificate of limited partnership does not void the partnership. It will then be considered as a
general partnership.
108. The firm name must not have the surname of a limited partner, unless such surname has been in the firm name prior to
the admission of the limited partner or it is the surname of a general partner as well.
109. When a limited partner participates in the management of the limited partnership, he becomes liable as a general
partner, but he does not become entitled to the rights of a general partner.
110. A limited partner can extend a loan to the limited partnership, but the limited partnership cannot secure said loan using
partnership property.
111. A substituted limited partner does not become a limited partner until and after the certificate of limited partnership is
amended.
112. In case illegal partnership, the capital contributed shall be returned to the contributing partner, but the proceeds of the
partnership shall be escheated in favor of the State.

CORPORATIONS
113. A corporation is said to be have a strong juridical personality because of its inherent attribute that it has the right of
succession.
114. The piercing of the corporate veil is used to reach the persons forming it, instead of reaching the corporations formed
by persons liable. This principle also applies to One Person Corporations (OPCs).
115. A corporation has the constitutional rights to due process, equal protection, and against unreasonable search and
seizure.
116. A corporation sole has no nationality.
117. The Roman Catholic Church is a corporation by prescription.
118. An ultra vires act is not necessarily an illegal act, but an illegal act is always an ultra vires act.
119. If a corporation aims to amend its articles of incorporation to change its corporate name, the dissenting stockholders
cannot exercise their appraisal right.
120. Incorporators of a corporation may be natural or juridical persons.
121. There is no minimum paid up capital for corporations.
122. Authorized capital stock >= issued shares >= outstanding shares
123. In case of increase of authorized capital, the 25%-25% rule must be based on the net increase.
124. A postdated check cannot be considered as a valid consideration for shares of stocks.
125. For services to be a valid consideration for shares of stocks, it must have already been rendered.
126. Advances for future subscription are not covered by the trust fund doctrine. They cannot be used to pay the creditors of
the corporation.
127. Foreigners can incorporate a corporation.
128. In the absence of any denial of voting right in the articles of incorporation, holders of preferred shares and redeemable
shares are entitled to vote in the similar manner as the holders of common shares.
129. All matters where a stockholder’s right of appraisal is available, require 2/3 vote of the stockholders holding
outstanding capital stock.
130. In matters which has important or significant consequences to the corporation and its stockholders, holders of non-
voting shares are entitled to vote.
131. Directors and trustees can never vote by proxy in directors’ or trustees’ meeting.
132. A proxy form can be valid for just one meeting or for a period not exceeding 5 years.
133. A voting trust agreement can be valid for more than 5 years if it is executed as required in a loan agreement, but it shall
be automatically terminated upon full payment of said loan.

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134. The 10% (of prior year’s net income before taxes) ceiling limiting the compensation given to directors in their capacity
as directors does not apply to compensation given to them in other capacity (e.g. when the director is also a Vice President
with compensation, his compensation as VP is not considered for purposes of computing the 10% ceiling).
135. Tenure refers to the period of time an incumbent actually holds office. It is different from “term”.
136. A President cannot be the Secretary or Treasurer at the same time. But in case of OPCs, a President can also be the
Treasurer, provided that he posts a bond.
137. A Vice President can be the Secretary or Treasurer at the same time.
138. A person can be both the Secretary and Treasurer at the same time.
139. Between the President, Secretary, and Treasurer, only the President is required to be a director.
140. Between the President, Secretary, and Treasurer, only the Secretary is required to be a citizen and resident of the
Philippines.
141. A buyer of shares of a corporation does not become the owner of the said shares as far as the corporation is concerned
until and after the sale is registered in the books of the corporation and the buyer is recorded as the owner.
142. If the foreign corporation not having a license to do business in the Philippines is the one being sued before Philippine
courts, its lack of standing can no longer be attacked.
143. The power to amend or repeal any by-laws or adopt a new by-laws may be delegated to the board of directors or
trustees by 2/3 vote, and revoke such delegation by majority vote.
144. When a director or trustee is removed, the resulting vacancy can be filled up by the stockholders or members.
145. An amended or new by-laws shall only be effective upon the issuance by the SEC of a certification that the same are
not inconsistent with the Corporation Code.
146. When a holdover director or trustee resigns, the resulting vacancy can only be filled up by the stockholders or
members.
147. When a director or trustee dies or resigns, the resulting vacancy may be filled up by the remaining directors or trustees
still constituting majority.
148. A stockholder can only be considered delinquent when he fails to pay the subscription price in full within the period
given by the board of directors when called to pay.
149. A delinquent stockholder may not vote or be voted upon, but still has the right to receive dividends.
150. When the board of directors declare stock dividends, it requires the 2/3 vote of the outstanding stockholders. If cash or
property dividends are declared, it does not require stockholders’ approval.
151. When treasury shares are distributed as dividends, it is considered as property dividends.
152. An independent director is still required to own at least one share of stock where he is supposed to sit as independent
director.
153. A derivative suit may only be filed before the Regional Trial Court which has jurisdiction over the principal office of
the corporation.
154. Generally, a purchaser of all or substantially all of the assets of a corporation is not liable for the debts and liabilities of
the selling corporation by virtue of the Corporate Entity Theory. However, it admits the following exceptions: (1) Where
the purchaser expressly or impliedly agreed to assume such debts; (2) Where the transaction amounts to a merger or
consolidation; (3) Where the purchasing corporation is a mere continuation of the selling corporation; and (4) Where the
transaction is entered into fraudulently in order to escape liability for such debts. This principle is also known as the Nell
Doctrine.
155. In stockholders’ or members’ meetings, voting by remote communication is allowed provided it is allowed under the
by-laws.
156. In directors’ or trustees’ meetings, participation or voting by remote communication is allowed even if not provided in
the by-laws.
157. The death or physical inability of a director to be present (e.g. sick or out of the country) during a board meeting does
not affect the quorum requirement. It remains the majority of the number of directors as fixed in the articles of
incorporation.
158. When a dissenting stockholder exercises his or her appraisal right, he or she can withdraw the demand for payment
only if the corporation consents thereto.
159. A dissenting stockholder who exercised his or her appraisal right shall not be entitled to payment if (1) the proposed
corporate action is abandoned or rescinded by the corporation, (2) the SEC disapproved the proposed corporate action, or
(3) the SEC determines that such stockholder is not entitled to the appraisal right.
160. The right of the members of any class or classes to vote may be limited, broadened or denied to the extent specified in
the articles of incorporation or the by-laws. Unless so limited, broadened or denied, each member, regardless of class, shall
be entitled to one vote.
161. Membership in a non-stock corporation and all rights arising therefrom are personal and non-transferable, unless the
articles of incorporation or the by-laws otherwise provide.
162. No person shall be elected as trustee unless he is a member of the corporation.
163. Officers of a non-stock corporation may be directly elected by the members, unless otherwise provided in the articles of
incorporation or the by-laws.
164. Any corporation may be incorporated as a close corporation, except mining or oil companies, stock exchanges, banks,
insurance companies, public utilities, educational institutions and corporations declared to be vested with public interest in
accordance with the provisions of Corporation Code.
165. A resident agent may be either an individual residing in the Philippines or a domestic corporation lawfully transacting
business in the Philippines, provided that, in the case of an individual, he must be of good moral character and of sound
financial standing.

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166. In case of shares of stock owned jointly by two or more persons, in order to vote the same, the consent of all the co-
owners shall be necessary, unless there is a written proxy, signed by all the co-owners, authorizing one or some of them or
any other person to vote such share or shares, provided, that when the shares are owned in an "and/or" capacity by the
holders thereof, any one of the joint owners can vote said shares or appoint a proxy therefor.

INSURANCE
167. An additional element of an insurance contract is insurable interest.
168. Perfection of insurance contract follows the Cognition Theory.
169. A beneficiary need not have an insurable interest.
170. The insurer in a life insurance contract shall be liable in case of suicide only when it is committed after the policy has
been in force for a period of two (2) years from the date of its issue or of its last reinstatement, unless the policy provides a
shorter period.
171. If the insurer granted a credit term for the payment of the premium, nonpayment of premiums will not void the
insurance contract.
172. The insurer is given two (2) years – from the effectivity of a life insurance contract and while the insured is alive – to
discover or prove that the policy is void from the beginning or is rescindable by reason of fraud, concealment or
misrepresentation of the insured or his agent.
173. A concealment whether intentional or unintentional entitles the injured party to rescind a contract of insurance.

COOPERATIVES
174. A cooperative may be formed by at least 15 natural persons.
175. No foreigner can form a cooperative. Only Filipinos can.
176. A cooperative, similar to a corporation, has limited liability and a separate personality other than the persons
composing it.
177. The minimum paid up capital for single purpose cooperatives is P15,000. For multipurpose cooperatives, it is
P100,000.
178. The par value of shares in a cooperative cannot be less than P100, but not more than P1,000.
179. A cooperative may issue preferred shares if provided in the bylaws and it cannot exceed 25% of its total authorized
capital stock.
180. A member cannot own more than 10% of the capital stock in a cooperative.
181. If a member inherits capital stock from a co-member, he can only receive the portion that will not make him exceed
10% of the capital stock. The excess has to be acquired by the cooperative by paying the fair value of the excess shares.
182. The quorum required for the general assembly meeting of cooperatives is generally at least 25%.
183. The quorum required for the general assembly meeting of electric cooperatives is at least 5%.
184. The quorum required for the general assembly meeting of cooperative banks is at least majority.
185. A laboratory cooperative does not have juridical personality.
186. When a director is removed, he or she may be replaced by the remaining directors still constituting majority.
187. The term of directors in a cooperative is 2 years.
188. If there is no fixed date of the cooperative’s general assembly regular meeting, it shall be held within 90 days from the
close of its fiscal year.
189. Proxy voting by members of a cooperative is only prohibited in primary cooperatives.
190. In a cooperative with 200 members, the presence of 50 (25%) constitutes a quorum, and 38 (75%) members of those
present may remove a director after observance of due process. The same goes for ratification of contracts with self-dealing
and interlocking directors, and mergers.
191. A cooperative’s articles of cooperation or bylaws may only be amended by 2/3 vote of ALL its voting members. The
vote of the board of directors is NOT necessary.
192. The prior written notice of special board meetings in cooperatives is at least ONE WEEK.
193. When a cooperative is dissolved and liquidated, the assets distributable to an unknown member shall be given to the
federation or union to which the cooperative is affiliated with.

PDIC
194. PDIC shall commence the determination of insured deposits due the depositors of a closed bank upon its actual
takeover of the closed bank.
195. When a depositor has both an individual account and a joint account, the maximum proceeds he can get from PDIC for
his or her insured deposits is P1,000,000.
196. If the account is held jointly by two or more natural persons, or by two or more juridical persons or entities, the
maximum insured deposit shall be divided into as many equal shares as there are individuals, juridical persons or entities,
unless a different sharing is stipulated in the document of deposit.
197. The depositor shall retain his or her claim for any uninsured portion of his or her deposit, which legal preference shall
be the same as that of the subrogated claim of PDIC for its payment of insured deposits.

SECRECY IN BANK DEPOSITS

198. A bank employee or officer reporting a suspicious or covered transaction to AMLC is not violating the rule on secrecy
of bank deposits.
199. Foreign currency deposits may not be garnished, unless it is made by a transient or a tourist.
200. Only an official or employee of a bank or an independent auditor hired by a bank to conduct regular audit may be held
liable for violation of Bank Secrecy Law.

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TRUTH IN LENDING
201. It is the policy of the State to protect its citizens from a lack of awareness of the true cost of credit to the user by
assuring a full disclosure of such cost with a view of preventing the uninformed use of credit to the detriment of the national
economy.
202. "Creditor" means any person engaged in the business of extending credit (including any person who as a regular
business practice make loans or sells or rents property or services on a time, credit, or installment basis, either as principal
or as agent).
203. Any creditor who in connection with any credit transaction fails to disclose to any person any information in violation
of RA 3765 shall be liable to such person: in the amount of P100, or in an amount equal to twice the finance charged
required by such creditor in connection with such transaction, whichever is the greater.
204. Any creditor shall furnish to each person to whom credit is extended, prior to the consummation of the transaction, a
clear statement in writing setting forth, to the extent applicable and in accordance with rules and regulations prescribed by
the Board, the following information: (1) the cash price or delivered price of the property or service to be acquired; (2) the
amounts, if any, to be credited as down payment and/or trade-in; (3) the difference between the amounts set forth under
clauses (1) and (2); (4) the charges, individually itemized, which are paid or to be paid by such person in connection with
the transaction but which are not incident to the extension of credit; (5) the total amount to be financed; (6) the finance
charge expressed in terms of pesos and centavos; and (7) the percentage that the finance bears to the total amount to be
financed expressed as a simple annual rate on the outstanding unpaid balance of the obligation.

AMLA
205. The Chairman of the Anti-Money Laundering Council is the BSP Governor.
206. As a general rule, the threshold for covered transactions is in excess of P500,000.00.
207. In case of casinos, the threshold for covered transactions is in excess of P5,000,000.00.
208. In case of jewelry dealers, the threshold for covered transactions is in excess of P1,000,000.00.
209. In case of real estate developers or brokers, the threshold for covered transactions is in excess of P7,500,000.00.
210. Only the Court of Appeals can issue a freeze order.
211. Under the Safe Harbor Rule, no administrative, criminal, or civil proceedings, shall lie against any person for having
made a transaction report in the regular performance of his duties and in good faith, whether or not such results in any
criminal prosecution under Philippine laws.
212. Should a transaction be determined to be both a covered and a suspicious transaction, it shall be reported as a
suspicious transaction.
213. If there is money laundering connected to a commission of a crime, the offender may be prosecuted for both crimes.
214. The Regional Trial Court (RTC) has jurisdiction over all cases of money laundering, but if the crime of money
laundering is committed by public officers and private person who are in conspiracy with such public officers, the
Sandiganbayan shall have jurisdiction.
215. All records of all transactions of covered institutions shall be maintained and safely stored for 5 years from the date of
transactions.
216. No prior criminal charge, pendency of a case, or conviction for an unlawful activity or ML offense is necessary for the
commencement or the resolution of a petition for civil forfeiture.
217. No asset shall be attached or forfeited to the prejudice of a candidate for an electoral office during an election period.
218. Lawyers and accountants who are: (a) authorized to practice their profession in the Philippines; and (b) engaged as
independent legal or accounting professionals, in relation to information concerning their clients, or where disclosure of
information would compromise client confidences or the attorney-client relationship are not required to file CTRs.
219. Lawyers and accountants, however, are not precluded from submitting STRs to the AMLC with regard to any
transaction of their clients that is in any way related to ML/TF or related unlawful activity that is about to be committed, is
being or has been committed.

INTELLECTUAL PROPERTY
220. In the case of a work commissioned by a person other than an employer of the author and who pays for it and the work
is made in pursuance of the commission, the person who so commissioned the work shall have ownership of the work, but
the copyright thereto shall remain with the creator, unless there is a written stipulation to the contrary.
221. No protection related to copyright shall extend to any idea, procedure, system, method or operation, concept, principle,
discovery or mere data as such, even if they are expressed, explained, illustrated or embodied in a work; news of the day
and other miscellaneous facts having the character of mere items of press information; or any official text of a legislative,
administrative or legal nature, as well as any official translation thereof.
222. Fair use of a copyrighted work for criticism, comment, news reporting, teaching including multiple copies for
classroom use scholarship, research and similar purposes is not an infringement of copyright.
223. If you posted your selfie on Instagram today, it shall be protected for 50 years commencing on January 1, 2024.
224. When someone wrote and sent you a letter, the letter belongs to you, but you cannot disclose the contents of the letter
without the consent of the sender.
225. The term of a patent is 20 years from the date of application and non-renewable.
226. Under the Doctrine of Equivalents, an infringement also takes place when a device appropriates a prior invention by
incorporating its innovative concept and, although with some modification and change, performs substantially the same
function in substantially the same way to achieve substantially the same result.
227. If two or more persons have made the invention separately and independently of each other the right to the patent shall
belong to the person who first filed an application for such invention.

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228. The term of a trademark is 10 years from the date of registration and renewable for another 10 years thereafter without
limit.
229. The owner of a well-known mark registered in the Philippines has rights that extends even to dissimilar kinds of goods.

DATA PRIVACY ACT

230. DPA is not applicable when personal information is processed for journalistic, artistic, literary, or research purposes.
231. The general data privacy principles are transparency, legitimate purpose, and proportionality.
232. Any criminal violation of the DPA shall be considered large-scale when the personal information of at least 100
persons is harmed, affected, or involved.
233. The rules on rights, its transmissibility, and portability are not applicable to processing of personal information
gathered for the purpose of investigations in relation to any criminal, administrative or tax liabilities of a data subject.
234. Personal data breach refers to a breach of security leading to the accidental or unlawful destruction, loss, alteration,
unauthorized disclosure of, or access to, personal data transmitted, stored, or otherwise processed.
235. The National Privacy Commission and affected data subjects shall be notified by the personal information controller
within seventy-two (72) hours upon knowledge of, or when there is reasonable belief by the personal information controller
or personal information processor that, a personal data breach requiring notification has occurred.

ELECTRONIC COMMERCE ACT

236. For evidentiary purposes, an electronic document shall be the functional equivalent of a written document under existing
laws.
237. Except as otherwise agreed by the parties, an offer, the acceptance of an offer and such other elements required under
existing laws for the formation of contracts may be expressed in, demonstrated and proved by means of electronic data
messages or electronic documents and no contract shall be denied validity or enforceability on the sole ground that it is in the
form of an electronic data message or electronic document, or that any or all of the elements required under existing laws for
the formation of contracts is expressed, demonstrated and proved by means of electronic data messages or electronic
documents.
238. Information shall not be denied legal effect, validity or enforceability solely on the grounds that it is in the data message
purporting to give rise to such legal effect, or that it is merely referred to in that electronic data message.
239. An electronic signature on the electronic document shall be equivalent to the signature of a person on a written document
if that signature is proved by showing that a prescribed procedure, not alterable by the parties interested in the electronic
document, existed.

EASE OF DOING BUSINESS ACT

240. The prescribed processing time for simple transactions is 3 working days.
241. The prescribed processing time for complex transactions is 7 working days.
242. The prescribed processing time for highly technical transactions is 20 working days.
243. In case an agency fails to approve or disapprove an original application within the prescribed processing time, the said
application shall be deemed approved.
244. No contact in any manner with any requesting party concerning an application or request except during submission of
documents.
245. Business One Stop Shop (BOSS) refers to a single common site or location, or a single online website or portal
designated for the Business Permit and Licensing System (BPLS) of an LGU to receive and process applications, receive
payments, and issue approved licenses, clearances, permits, or authorizations.
246. Philippine Business Databank: This shall provide NGAs/LGUs access to data and information to verify the validity and
existence of business entities. Applicants need not submit the same documentary requirements previously submitted.
247. The Chairperson of the EODB/ART Advisory Council is the DTI Secretary. Its Vice-Chairperson is the Director-
General. The Director-General heads the ART Authority.
248. The two representatives to the EODB/ART Advisory Council from the private sector are appointed by the President for
a term of 3 years.
249. First-time offenders shall be administratively liable under EODB Act, unless it involves fixing or collusion with fixers
which shall be punishable under the Revised Penal Code.
250. Criminal liabilities in case violation of EODB attach only in case of second violation (“Two-strike policy”).
251. The administrative jurisdiction on any violation of the provisions of the EODB Act shall be vested in either the CSC, or
the Office of the Ombudsman as determined by appropriate laws and issuances.

LABOR LAW
252. Where there are two (2) successive regular holidays, like Maundy Thursday and Good Friday, an employee may not be
paid for both holidays if he/she absents himself/herself from work on the day immediately preceding the first holiday,
unless he/she works on the first holiday, in which case he/she is entitled to his/her holiday pay on the second holiday.
253. Seasonal workers may not be paid the required holiday pay during off-season when they are not at work.
254. The “no work, no pay” principle applies during special days and on such other special days as may be proclaimed by
the President or by Congress.
255. Workers who are not required or permitted to work on special days are not entitled to any compensation.
256. The unused service incentive leave is commutable to its money equivalent at the end of the year.
257. The maternity leave benefit applies to all covered female employees, regardless of civil status, employment status, and
the legitimacy of her child.

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258. The maternity leave benefit shall be for one hundred five (105) days with full pay, and additional fifteen (15) days with
full pay in case the female employee qualifies as a solo parent under RA 8972.
259. Paternity leave is granted to all married male employees in the private sector, regardless of their employment status
(e.g., probationary, regular, contractual, project basis).
260. Paternity leave benefit shall apply to the first four (4) deliveries of the employee’s lawful wife with whom he is
cohabiting.
261. All employers are required to pay their rank-and-file employees 13-month pay, regardless of the nature of their
employment and irrespective of the methods by which their wages are paid, provided they worked for at least one (1) month
during a calendar year.

SOCIAL SECURITY LAW

262. Coverage in the SSS shall be compulsory upon all employees including kasambahays or domestic workers not over
sixty (60) years of age and their employers
263. Spouses who devote full time to managing the household and family affairs, unless they are also engaged in other
vocation or employment which is subject to mandatory coverage, may be covered by the SSS on a voluntary basis.
264. If the self-employed member realizes no income in any given month, he shall not be required to pay contributions for
that month.
265. The contribution imposed in the preceding section shall be remitted to the SSS within the first ten (10) days of each
calendar month following the month for which they are applicable or within such time as the Commission may prescribe.
266. Self-employed members shall remit their monthly contributions quarterly on such dates and schedules as the
Commission may specify through rules and regulations.
267. An employee shall not be qualified to receive the benefit if he/she has been involuntarily separated from employment
due to the following: Serious misconduct, Willful disobedience to lawful orders, Gross and habitual neglect of duties, Fraud
or willful breach of trust/loss of confidence, Commission of a crime or offense; or Analogous cases like abandonment,
gross inefficiency, disloyalty/ conflict of interest/ dishonesty.
268. Any employer who, after deducting the monthly contributions or loan amortizations from his employee’s
compensation, fails to remit the said deduction to the SSS within thirty (30) days from the date they became due, shall be
presumed to have misappropriated such contributions or loan amortizations and shall suffer the penalties provided in Article
315 (“estafa”) of the Revised Penal Code.
269. Retirement benefit is a cash benefit granted—either as a monthly pension or a lump sum amount—to a member who
can no longer work due to old age.
270. For a covered employee who lost one hand, the SSS gives a benefit equivalent to 39 months.

Panginoon, salamat po sa pagkakataong sumubok na maging isang ganap na CPA.

Salamat po sa lahat ng mga taong nagmamahal at patuloy na sumusuporta sa aming lahat—sa aming mga kapamilya,
kaibigan, guro, kaklase, kasama na rin ng mga taong hindi namin kakilala ngunit nagbibigay sa amin ng karagdagang pag-asa
upang mapagtagumpayan ang nalalapit na pagsusulit. Gaano man kami katapang at kahanda, batid Ninyo kung ano ang tunay
naming nararamdaman sa aming mga puso. Nawa’y tanggalin ‘Nyo lahat ng pag-aagam-agam at pagdududa sa aming puso at
isipan. Muli Ninyong ipaalala sa amin ang walang katapusang pagmamahal na matagal na Ninyong ipinamalas at
ipinaramdam sa amin. Hindi kami aabot nang ganito kalayo kung wala kaming kakayahan upang tapusin ang kahuli-huling
hakbang patungo sa katuparan ng aming mga pangarap. Sa mga darating na araw, ipanatag Ninyo nawa ang aming puso at
isipan upang buo naming maalala lahat ng aming inaral. Iniaalay po naming lahat ang Inyong ipinangakong tagumpay para sa
kapurian ng Inyong Pangalan.

Lahat ng ito ay aming buong pusong ipinapanalangin sa ngalan ng Maykapal at tanging Tagapagligtas.
AMEN.

9 | EVERTHING RFBT BY NICO B. VALDERRAMA