1. The period of four years shall not begin until the domicile of the ___ is known.

a. injured party
b. minor
c. person under guardianship
d. Absentees

2. When are contracts presumed to have been entered into in fraud of creditors under Article
1387 of the Civil Code?
a. When the debtor alienates property by gratuitous title without reserving sufficient property to pay all
debts contracted before the donation.
b. When the debtor alienates property by onerous title after a judgment or attachment has been issued
against them.
c. When the debtor alienates property by any title, whether gratuitous or onerous, without the consent of
the creditors.
d. When the debtor alienates property without disclosing the existence of any outstanding debts.

3. A ward is a/an:
a. Appointed or recognized by law to act on behalf of someone who is incapable of managing their own
affairs.
b. Property or assets that are the subject of the guardianship.
c. Person under guardianship by reason of some incapacity.
d. The injury suffered by one who did not receive the equivalent value of what was bargained for.

4. Because of the following requisites, PAYMENTS are bound to be rescinded. Which among the
statements are the requisites?
I - The period for filling the action for rescission is not prescribed.
II - The rescission is based upon a case especially provided by law.
III - The debtor is in a state of insolvency.
IV - The obligation is not yet due and demandable.

a. Only IV
b. Both I and III
c. Only II
d. Both III and IV

5. The option to rescind a contract can be done immediately after suffering damages.
a. True
b. False

6. The action to claim rescission must be commenced within _____.

a. 5 years
b. 4 months
c. 4 years
d. 5 months

7. What is the underlying reason behind the principle of proportionality in the application of rescission?
a. Ensures that the remedy is fair and appropriate considering the severity of the breach or misconduct
b. Serves to protect the interests of both parties involved
c. Promotes efficient dispute resolution and maintains the overall integrity of contractual relationships.
d. All of the above.

8. Which of the following statements is incorrect?

a. The policy of the law in the application of rescission aims to extinguish the contract.
b. The rescission shall only be to the extent of the creditor’s unsatisfied credit.
c. The entire contract need not be set aside by rescission if the damage can be repaired or covered by
partial rescission.
d. None of the above.
9. What should be returned in rescinding a contract?
a. The object of the contract, its fruits, and the price, with its interest.
b. The object of the contract only must be returned.
c. The object and the price, with its interest.
d. Only the fruits and the interest.

10. Which of the following statements is incorrect in regards to contracts that are rescissible?
a. Those undertaken in fraud of creditors when the latter cannot in any other manner collect the claims
due them.
b. Those which are entered into by guardians whenever the wards whom they represent suffer lesion by
less than one-fourth of the value of the things which are the object thereof.
c. Those agreed upon in representation of absentees, if the latter suffer the lesion stated in the preceding
number.
d. Those which refer to things under litigation if they have been entered into by the defendant without the
knowledge and approval of the litigants or of competent judicial authority.

11. When there is a lesion in the contract of sale, it is immediately rescissible.

a. True
b. False

12. What does a lesion mean in a rescissible contract? Which is the best answer?
a. An injury suffered by the party in a contract
b. An injury suffered by the person due to the price in a contract
c. An injury suffered by the party/person due to an inadequate price received in a contract
d. An injury suffered by the party/person due to an inadequate price received set by the debtor and
creditor in a contract

13. Which of the following statements is True regarding the presumption of fraud under Article 1387?
a. The presumption of fraud is conclusive and cannot be rebutted.
b. The presumption of fraud applies regardless of whether there has been an actual transfer of property.
c. The burden of proof is shifted to the person who alienated the property to prove that the transfer was
not fraudulently made.
d. The presumption of fraud applies only when the debtor alienates property to his or her relatives.

14. Who can ask for the rescission of a conveyance made by a debtor in favor of strangers under Article
1387?
a. Only the debtor who made the conveyance.
b. Any person who suspects fraudulent intent.
c. Only the actual creditors of the debtor.
d. The court that issued the judgment or attachment against the debtor.

15. When a contract of sale that has been approved by the court, has been entered into by the guardian,
and lesion occurred by more than one-fourth of the value of the property, can it be rescinded?
a. Yes, because of the lesion suffered by the owner of the property.
b. No, because it was entered into by the guardian and approved by the court.
c. Yes, because it was not the owner who entered into the contact of sale.
d. No, because it was a property that was sold under the contract of sale.

16. Which of the following is true regarding the liability of a purchaser in bad faith, who acquired an object
of the contract alienated in fraud of creditors, as per Article 1388?
a. The purchaser is not liable to return the object if the sale is rescinded.
b. The purchaser is only liable to indemnify the former owner if the sale is rescinded.
c. The purchaser is liable to return the object if the sale is rescinded, but not indemnify the former owner
d. The purchaser is liable to return the object if the sale is rescinded, and also indemnify the former owner
if returning the object is impossible due to any cause.

17. According to Article 1388, who is responsible for indemnifying the creditors for damages
suffered due to the alienation of things in fraud of creditors?
a. The first acquirer of the alienated things.
b. The former owner of the alienated things.
c. The creditors themselves.
d. The purchaser in good faith.

18. Which of the following requisites of rescission is incorrect?

a. There must be lesion or pecuniary prejudice to one of the parties or to a third person.
b. The rescission must be based upon a case especially provided by law.
c. There must be no other legal remedy to obtain reparation for the damage.
d. The contract must not be validly agreed upon.

19. It entails the return of the benefits that each party may have received as a result of the contract.
a. Rescission
b. Mutual Restitution
c. Restitution
d. Reformation

20. It is a contract where there is no defect at all but by reason of some external facts, its enforcement
would cause injustice.
a. Rescissible Contracts
b. Voidable Contracts
c. Unenforceable Contracts
d. Void or Inexistent Contracts

21. Which among the statements is FALSE?

a. The debtor’s insolvency need not be judicially declared.
b. Obligations that are referred to in Article 1382 are also those which cannot be legally demanded.
c. Obligations that are referred to in Article 1382 are also those that are not prescribed.
d. A debtor is insolvent if he does not have sufficient properties to meet his obligations

1. I. Action for declaration of the in existence of a contract does not prescribe

II. A judicial declaration is needed to make the contract void.
a. True, True
b. True, False
c. False, True
d. False, False

2. Which of the following statement/s is/are a void contract

I. Niki sells a lot on the moon for Php 100,000 per square meter.
II. Lilac sold her mango fruits that will grow from her tree next month.
III. Henry, a fully deaf man but has 20/20 vision, will be given an iPhone 14 if he is able to hear what the
neighbor next door is saying.
a. I. only
b. II and III
c. I and III
d. All of the statements are void

3. What happens when the intention of the parties relative to the principal object of the contract cannot be
ascertained?
a.. The contract is considered void.
b. The contract is temporarily suspended until further investigation.
c. The court determines the intention based on available evidence.
d. None of the above.

4. Ethan and Benjamin enter into a contract where they agree to buy and sell a rare antique painting.
However, upon further investigation, it is revealed that the painting does not exist and was fabricated
solely for the purpose of the contract. How would the contract be treated based on the provision of Article
1409?
a. The contract would be considered valid and enforceable since both parties agreed to the sale.
b. The contract is considered absolutely simulated or fictitious and is void from the beginning.
c. The contract could be ratified if Ethan and Benjamin provide evidence of an equivalent painting.
d. The contract would only be considered void if one party claims illegality.

5. According to Article 1411, when the nullity of a contract proceeds from the illegality of the cause or
object, and the act constitutes a criminal offense, what is the legal consequence?
a. The contract remains valid, but the offending party may face criminal charges.
b. The contract is considered null and void, and the offending party may face criminal charges.
c. The contract remains valid, and the offending party is exempt from any criminal liability.
d. The contract is considered null and void, but the offending party is exempt from any criminal liability.

6. In Article 1412, if the act in which the unlawful or forbidden cause consists does not constitute
a criminal offense, what is the legal consequence regarding the contract?
a. The contract remains valid and enforceable.
b. The contract is considered null and void.
c. The contract becomes voidable at the option of the injured party.
d. The contract is automatically modified to remove the unlawful cause.

7. According to Article 1413, if interest paid exceeds the limit set by usury laws, who can recover the
excess interest?
a. The debtor who paid the excess interest.
b. The creditor who received the excess interest.
c. The court system.
d. The government.

8. Under Article 1413, what is the legal consequence of interest paid in excess of the interest allowed by
usury laws?
a. The excess interest is forfeited by the debtor.
b. The excess interest is refunded to the debtor.
c. The creditor is allowed to keep the excess interest.
d. The interest remains valid and unaffected.

9.The following are the requisites for the application of Article 1414, except:
a. A contract that is for an illegal purpose
b. The contract is repudiated before the purpose has been accomplished OR before any damage has
caused to a third person
c. A contract that is for a legal purpose
d. The court considers that public interest will be subserved by allowing recovery

10. In a contract where money is paid or property is delivered for an illegal purpose, which of the following
statements regarding repudiation and recovery is correct?
a. Both parties have the right to repudiate the contract at any time.
b. The contract can be repudiated only after the illegal purpose has been accomplished.
c. The party repudiating the contract can recover the money or property regardless of the public interest.
d. The courts may allow the party repudiating the contract to recover the money or property if the public
interest is served.

11. In contract law, when one of the parties to an illegal contract is incapable of giving consent, what may
the courts do if the interest of justice demands it?
a. Void the entire contract and disallow any recovery of money or property.
b. Allow the incapacitated person to recover money or property delivered by them.
c. Fine both parties involved in the illegal contract.
d. Invalidate the contract but allow the other party to keep the delivered money or property.

12. Ken is a minor who invested P15,000 in an illegal business venture. Before the business started its
operations, Ken decided to back out. Is he entitled to the recovery of the money invested? Choose the
best answer.
a. No, Ken already invested his money in the business and has no right to ask for recovery.
b. Yes, Ken is a minor who is incapable of giving consent and is entitled to recovery of his invested
money.
c. No, since Ken is in pari delicto and thus, has no right of action against the illegal business venture.
d. Yes, since the illegal business venture favors Ken and his co-owners.

3. I. Presidential Decree No. 422, otherwise known as the Labor Code, sets forth that the normal hours of
work of any employee shall not exceed 12 hours a day.
II. A statute fixing the maximum price of any article or commodity is usually knowN as the ceiling law.
a. Statement I is correct.
b. Both statements are correct.
c. None of the statements are correct.
d. Statement II is correct.

14. Presidential Decree No. 422, otherwise known as the Labor Code, applies to employees in all
establishments and undertakings, whether for profit or not. However, it does not cover the following
except
I. Government employees
II. Domestic Helpers
III. OFWs
IV. Field personnel
V. Workers who are paid by results
a. II, III, IV, and V
b. Only III
c. Only I
d. I, IV, and V
e. All are correct

15. In the advent that a person receives less than his minimum wage rate, which of the following
is true?
a. If an employee receives less than the minimum wage rate, he can still recover the deficiency with legal
interest and the employer shall be criminally liable.
b. If an employee receives less than the minimum wage rate, he can still recover the deficiency with legal
interest and the employer shall be civilly liable.
c. If an employee receives less than the minimum wage rate, he can no longer recover the deficiency.
d. None of the statements is true

16. Suppose by the Executive Order of the President the price of mangoes can only be a maximum of
P400 per kilo, whether there is particular brand or not. When you were out shopping in the market, a lady
offered you mangoes. She said it is very hard to find this kind of mangoes, and offered it to you for P500
per kilo. Without your knowledge of the ceiling law (a statute fixing the maximum price of any article or
commodity), you bought 2 kilos of mangoes. You got home and your lawyer friend told you about the
Executive Order of the President. Can you recover? If yes, how much would it be?
a. No, because the buyer is already in possession of the thing. Therefore, the buyer cannot recover the
excess amount from his payment.
b. Yes, because even if the buyer paid P500 per kilo, whether or not they knew the regulation, they must
be allowed to recover the P100 excess from his payment per kilo.
c. No, because as the buyer, you should know the law and ignorance of the law excuses no one.
d. Yes, because the seller had actual knowledge that such representation was made false and the buyer
will recover P200 per kilo.

17. Mario sold to Luigi his house and illegal drugs for P 1,000,000. What happens to the contract?
a. The contract is void and unenforceable
b. The contract is invisible therefore it wholly void
c. It is divisible contract where the illegal one can be separated by the legal one, the later may remain
d. It is an indivisible contract where the illegal one can’t be separated by the legal one

18. Travis is indebted to Scott 50,000 dated on July 31,2021, on August 3, 2021 Travis sold his properties
to his wife Imani and declared bankruptcy. Is Scott entitled to raise defense of illegality or nullity?
a. No, because third persons are not allowed to bring an action to annul such contracts.
b. No, because the contract is illegal
c. Yes, because his interests are directly affected.
d. Yes, because Imani is the wife of Travis and under the law, husband and wife cannot sell property to
each other.
19. I. When the consideration is entire and single, the contract is indivisible so that if part of such
consideration us illegal, the whole contract is void and unenforceable.
I. An illegal contract is void and inexistent and can, therefore, give rise to a valid contract.
III. The defense of illegality of contracts is available to third persons whose interests are directly related.
a. True, True, False
b. True, False, True
c. False, True, False
d. False, True, False

20. Blacklabel Agency has been eyeing Kim to sign under their company. They found out that Kim’s
contract with her recent company was almost ending. Upon knowing this, Blacklabel Agency started
sending messages to Kim, blackmailing her to sign to the company. Kim got threatened and later signed
with Blacklabel Agency. Is the contract valid?
a. Yes, because she signed the contract.
b. Yes,, because the contract is made after her previous contract expired.
c. No, because the contract is the direct result of a previous illegal act and, therefore, is itself null and
void.
d. No, because the contract is existent and cannot give rise to a valid contract

1. Refers to those that cannot be enforced or given effect in a court of law or sued by reason of certain
defects provided by law until and unless they are ratified according to law.
A.Unenforceable contracts
B. Statute of Frauds
C. Unauthorized contracts
D. Void contracts

2. Refers to those entered into in the name of another person by one who has given no authority or legal
representation or who has acted beyond his powers.
a. Unenforceable contracts
b. Statute of Frauds
c. Unauthorized contracts
d. Void contracts

3. What is an unenforceable contract?

A. A contract that is valid but not legally binding
B. A contract that is void and has no legal effect
C. A contract that lacks consideration
D. A contract that is impossible to perform

4. What is the main difference between a void and unenforceable contract?

A. A void contract is never valid, while an unenforceable contract was valid but cannot be enforced in
court
B. A void contract is valid but has certain unenforceable provisions
C. Both terms refer to the same type of contract
D. A void contract is never signed, while an unenforceable contract is signed with mutual consent

5. Under Article 1408 of the law on obligation, which of the following is a requirement for a third person to
be able to assail an unenforceable contract?
A. The third person must have a direct interest in the contract
B. The third person must be a resident of the same city as the parties to the contract
C. The third person must have been present when the contract was signed
D. The third person must have a notarized affidavit attesting to the invalidity of the contract

6. What is the potential consequence if a third person is able to successfully assail an unenforceable
contract under Article 1408?
A. The contract may be enforced against one or both parties
B.. The contract may be voided or rescinded without legal penalty
C. The third person may be required to pay damages to one or both parties
D. The third person may be required to enter into a new contract with one or both parties
7. If both parties that entered into the contract are insane and only one of the parties has an authorized
representative that has ratified the contract. The contract will be an/a -
A. Void Contract
B. Enforceable Contract
C. Voidable Contract
D. Valid Contract

8. Two minors, Yukka and Kate, entered into a contract. The parents of Yukka and Kate have ratified their
contract on their behalf. The contract will be valid but when will its validity take place?
A. On the day the contract was entered.
B. On the day when it was ratified by the parents.
C. The next day of the ratification by their parents.
D. On the day stipulated in the contract.

9. The principle of Statute of Frauds is applicable only to

A.Partially Executory
B.Totally Executed
C. Completely Executory Contracts
D. No Contract at all

10. The following are some of the agreements which fall within the scope of the Statute of Frauds which
are not legally valid enforceable in court although valid, unless the same be in writing.
A. Representation as to credit of a third person.
B. When the creditor accepts the thing or sum deposited, without objection, as payment of the obligation
C. Agreement not to be performed within one (1) year from the making thereof.
D. Promise to answer for the debt, default, or miscarriage of another.

11. A contract is unauthorized when:

A. Illicit objects are involved.
B. One contracts in the name of another by one who has no authority or legal representation.
C. It is executed by a minor.
D. When both parties bind a contract through mere words only.

12. A contract entered into in the name of another by one who has no authority or legal representation is
unenforceable unless:
A. Ratified expressly or impliedly.
B. The principal is unaware of his / her agent.
C. There is a third party involved.
D. There is a guarantor.

13. Which party is responsible for registering a contract in the Registry of Deeds?
A. The party initiating the contract
B. The party with more bargaining power
C. The party who drafted the contract
D. Either party can take responsibility

14. Which contracts are unenforceable unless ratified?

A. Contracts entered into in the name of another person without authority
B. Contracts that do not comply with the Statute of Frauds
C. Contracts where both parties are incapable of giving consent
D. All of the above

15. It is where both parties entered into a contract which are incapable of giving consent, the contract is
unenforceable. However, if either of the parties attains capacity and ratifies the contract, it becomes?
A. Unenforceable contract
B. Void contract
C. Valid contract
D. Voidable contracts
16. The sale of house and lot made by Dan without the authorization of Daniela (owner) is void but
afterwards Dan was given consent by Daniela to sell it. Which of the following statements is true?
A. The contract becomes enforceable since Dan is able to sell it.
B. The contract is still void.
C. The contract becomes valid after giving consent of Daniela to Dan.
D. The contract is still unauthorized since the consent was not made under the court

17. Statute designed to prevent the commission of fraud by requiring certain contracts to be in
writing and be subscribed by the party charged.
A. Law on Obligation
B. Law on sales
C. Statue of fraud
D. Fraud

18. The following contracts are unenforceable, unless they are ratified;
A. Those entered into in the name of another person by one who has been given no authority or legal
representation, or who has acted beyond his power
B. An agreement made in consideration of marriage, other than a mutual promise to marry;
C. A & B is true
D. B is false

19. The following are the requisites for action to rescind contracts in fraud of creditors, except
a. the debtor has other legal remedy to satisfy his claim
b. the third person who received the property conveyed, if if is onerous title, has been in good faith
c. the debtor did not perceive thereof the possibility of the creditor to be in default
d. where the court laid down the rule that a sale of real estate affected by minors who pretended to have
already reached their majority, while in fact they have not, is valid

20. The statute of frauds is a legal doctrine requiring that certain types of contracts be in written form
except?
a. suretyship contracts
b. transfers of intellectual property rights
c. marriage
d. service modification

1. An agreement which is enforceable by law at the option of one or more of the parties.
a. Voidable contract
b. Void contract
c. Valid contract
d. No contract

2. It cleanses the contract from all its defects from the moment it was constituted.
a. Refusal
b. Ratification
c. Rejection
d. Opposition

3. The action for annulment shall be brought within ____ years.

a. 4 years
b. 10 years
c. 5 years
d. 3 years

4. Which among the following is not part of the period for filling action for annulment?
a. In cases of intimidating, violence, or undue influence, from the time intimidation, etc., ceases.
b. In case of mistake or fraud, from the time of discovery of the same.
c. Once ratified, they become absolutely valid and can no longer be annulled.
d. When the action refers to the contracts entered into by minors or other incapacitated person, from the
time guardianship ceases.
5. What are the requisites for ratification to extinguish the action to annul a voidable
contract?
a. The contract must be voidable or annullable.
b. The ratification must be made without knowledge of the cause for nullity.
c. The cause of nullity must still exist at the time of ratification.
d. The ratification must be made voluntarily by the party under no disability and with knowledge of the
cause for nullity.

6. What effect does ratification have on the action to annul a voidable contract?
a. Ratification amplifies the grounds for annulment.
b. Ratification prolongs the time period for filing the action to annul.
c. Ratification extinguishes the action to annul.
d. Ratification transfers the right to annul to the other party.

7. Which of the following statements accurately describes implied ratification of a voidable

contract?
a. Implied ratification requires a written document signed by the party entitled to ask for annulment.
b. Implied ratification is solely based on oral affirmations made by the party entitled to ask for annulment.
c. Implied ratification is inferred from the conduct or acts of the party entitled to ask for annulment.
d. Implied ratification can only occur if the reason for contract annulment still exists.

8. John, a minor, enters into a contract to purchase a vintage car from a dealership. After reaching the
age of majority, he becomes aware of the reason that makes the contract voidable. However, instead of
seeking annulment, he continues to use the car regularly, participates in car shows, and maintains it in
pristine condition. What can be inferred from John's actions?
a. John has expressed his intention to seek annulment of the contract.
b. John has impliedly ratified the contract through his conduct.
c. John is still eligible to ask for annulment due to his age at the time of contract formation.
d. John's actions have no impact on the validity of the contract.

9. A contract entered into by an incapacitated person may be ratified by:

a. the guardian or injured party himself provided his already capacitated.
b. a stranger to the contract and also the party.
c. the janitor.
d. the police.

10. What is the significance of the phrase "He who comes to the court must come with clean hands" in
relation to ratification?
a. It emphasizes the need for the guilty party's conformity in the ratification process.
b. It highlights the requirement of the innocent party to seek annulment before ratification.
c. It signifies that the innocent party can ratify the contract regardless of the guilty party's consent.
d. It indicates that the guilty party must seek the consent of the innocent party for ratification

11. Kyla and Kent enter into a contract for the sale of an antique painting. However, Kyla later discovers
that Kent misrepresented the authenticity of the painting. Kyla, being the innocent party, has the right to
bring an action for annulment. Despite this, Kyla decides to ratify the contract and continue with the sale.
What is the implication of Kyla's decision?
a. Kent's conformity is required for the ratification to be valid.
b. Kyla's ratification renders Kent's misrepresentation irrelevant.
c. Kylaa's ratification will automatically lead to the annulment of the contract.
d. Kylaa can unilaterally ratify the contract without Kent's consent.

12. What does ratification do to a contract?

a. Invalidates the contract
b. Maintains the defects of the contract
c. Cleanses the contract from all its defects
d. Increases the defects of the contract

13. The action for the blank of contracts may be instituted by all who are thereby obliged principally or
subsidiarily.
a. Voidable
b. Annulment
c. Void
d. Valid

14. Who may invoke Restitution?

a. A stranger
b. Your mother
c. A criminal
d. Only between the parties who are privy with the contract.

15. Shall the contracting parties must restore to each other the subject matter of the contract with its fruits
and the price thereof with legal interest?
a. No way
b. Yes, ofcourse
c. Depends
d. Ewan ko

16. The following are characteristics of a voidable contract, which is the exception?
a. Effective until set aside.
b. Can be confirmed or ratified.
c. Can be assailed only by either party.
d. May be assailed or attacked only in an action for that purpose

17. The person who lost the thing through their own fault cannot simply avoid their obligation to return it
by claiming that it is lost.
a. true
b. false
c. not sure
d. maybe true

18. In article 1401, The action for annulment of contracts shall be _____ when the thing which is the
object thereof is lost through the fraud or fault of the person who has a right to institute the proceedings.
a. VOID
b. VOIDABLE
c. ANNULLED
d. EXTINGUISHED

19. Which statement is true?

a. Mox was forced by Ray to enter into a contract of barter whereby Mox exchanges his fountain pen with
Ray’s ring. If the fountain pen is lost due to the fault of Ray. Ray’s right of the annulment is extinguished.
b. Mox was forced by Ray to enter into a contract of barter whereby Mox exchanges his fountain pen with
Ray’s ring. If the fountain pen is lost due to the fault of Ray. Mox right of the annulment is extinguished.
c. Both a and b are correct
d. None of the above

20. An example of article 1402 is

C was forced by B to enter into a contract to barter whereby B exchanged his iphone with C’s Tablet. If
the contract is annulled B is required to return the tablet to C and C is required to return the iphone to B. if
the iphone is lost due to a fortuitous event, the C’s right to annulment shall subsist but B is not required to
return the tablet to C unless the value of the iphone at the time of its loss is returned by C to B.
What will be the consequences when the contracting parties do not restore what in virtue of the decree of
annulment he is bound to return?
a. The other party cannot be compelled to comply with what is incumbent upon him.
b. The other party can be compelled to comply with what is incumbent upon him.
c. Both A &B
d. None of the above
True/False
1. Lauren owes Marsha the sum of P1,000, which sum is already due and demandable. She also owes
Laura the amount of P10,000, which obligation has recently matured. Lauren currently only has P5,000 in
cash. Much as she would want to, she cannot invoke application of payments in
this case.

2. Lauren owes Marsha the sum of P100,000, which sum is already due and demandable. She also owes
Laura the amount of P1,000,000, which obligation has recently matured. Lauren currently only has
P100,000 in cash and P500,000 in noncash assets. If Lauren cedes or assigns all her property to Marsha
and Laura in payment for the debts, she is paying a portion of the obligations through a payment by
cession and not through tender of payment and consignation.

3. Lauren borrowed Laura’s nice blue gown to wear to a glamorous party. After the event, an unexpected
strong gust of wind emanating from a storm blew away the blue gown, just as Lauren picked it up from the
laundromat. In this instance, the presumption is that the loss of the thing is through Lauren’s fault since
she was in possession thereof at the time of the loss.

4. Lauren and Laura entered into a contract where Laura will send Lauren the sum of P1,000 and in turn,
Lauren will deliver to Laura a pale blue gown. After receiving from Laura the sum of money, Lauren is set
to deliver to Lauren a pale blue gown, but at that precise moment, an especially strong gust of wind lifted
and then blew it away. In this instance, the obligation of Lauren is extinguished since the thing, the
subject matter thereof was lost through a fortuitous event.

5. Lauren loaned from Laura the sum of P10,000. When the obligation became due, it became apparent
that Lauren cannot pay. As a good friend, Laura approached Lauren then told her that she already
condoned the obligation. In this instance, Lauren still has to accept Laura’s generosity before the
obligation is considered as extinguished.

6. Marsha owes Elise the sum of P10,000. As a security thereof, Marsha issued to Elise a post-dated
check with the same amount, with the check being issued to Cash, meaning anyone in possession
thereof can encash said check from the bank. As the check had not yet matured and Elise already
needed the money, she negotiated or “sold” the same to Katie, who is willing to pay P9,500 for it. When
the check matured, Katie used it to pay her obligation to Marsha who accepted the same. In this case,
there is confusion in the person of Marsha for the sum of P10,000 and not P9,500.

7. Spork owes Cricket the sum of P1,000 which will become due on November 15, 2022. Cricket owes
Spork the sum of P1,000 which will become due on November 20, 2022. On November 25, 2022, the two
obligations were already extinguished through compensation.

8. Spork is the creditor of Cricket for the sum of P10,000. Later on, Ms Marmalady presented herself to be
the new obligor in lieu of Cricket and told Spork that she will just be the one to pay the sum of P10,000.
Spork accepted the offer of Ms Marmalady, although Cricket did not. In this case, there is no novation
since the change in the personality of the creditor is without the consent of the old debtor, Cricket.

9. Spork is the creditor of Cricket for the sum of P10,000. Later on, Ms Marmalady presented herself to be
the new obligor in lieu of Cricket and told Spork that she will just be the one to pay the sum of P10,000.
Spork accepted the offer of Ms Marmalady, although Cricket did not. In this case, there is novation
through delegacion.

10. Ms Marmalady owes Spork the sum of P10,000. As evidence of the obligation, she issued to Spork a
promissory note that is payable to whoever is the bearer or whoever is in the possession thereof. The
promissory note also has the amount of P10,000. Spork then bought some household supplies from a
store that accepts negotiable instruments, like the promissory note, as payment thereof. Spork spent
P10,000 for the supplies and paid them with the promissory note. The owner of the store happens to be
Ms Marmalady. In this instance, the obligation is extinguished through novation.
Multiple Choice
1) On December 1, 2022, Mickey offered for sale to Minnie his roadster racer for P100,000. He further
stipulated that payment should be made in cash. On December 2, Minnie told Mickey that she is willing to
buy the roadster racer for P100,000, but that payment should be done in two monthly installments of
P50,000 starting December 15, 2022. Mickey then told her that he will still think about it. On December 6,
Mickey told Minnie that he now agrees to sell the roadster race for P100,000 in two monthly installments.
Is there already a contract between Mickey and Minnie?

a) No, since a contract must be accepted on the day the offer was made
b) Yes, there was a contract perfected on December 1, 2022 since there was already a meeting of the
minds on the object and on the price
c) Yes, there’s perfection of the contract on December 6 since it is on that day that the parties have a
meeting of the minds on the object, the price and the stipulation for the payment thereof
d) Not yet, until such time the Mickey will already have fully paid the price

2) Two friends, Minnie and Daisy, were talking about the new lessons that they just learned in their AC
1102 class. They were discussing about the vices of consent. Minnie named the following choices as
such vices of consent, but Daisy said one of them is NOT a vice of consent. Which is it?
a) Mistake
b) Intimidation
c) Hesitation
d) Undue influence

3) Kitty and Skye went to the store of Everest and saw a shiny bracelet. Kitty liked the bracelet and
wanted to buy it. She thought that it’s made of white gold and asked Skye for her opinion. Skye thought
that it’s also made of white gold and told Kitty. Just to be sure, Kitty asked Everest but Everest told her
she’s not sure since the jewelry is only consigned to her store by a jeweler. Nonetheless, she told the girls
that in her opinion, it’s also made of white gold. After Kitty bought the jewelry, she had it appraised by a
jeweler who told her that such is made of silver and not of white gold. Is there a contract in this case?
a) No, since it is clear that the parties did not have a meeting of the minds on the object
b) Yes, there is a contract that is valid although voidable
c) Yes, there is a contract that is valid for all intents and purposes
d) No, since it is clear that there is fraud incidental to the sale

4) Kitty and Skye entered into a contract where Kitty will deliver to Skye a pink bracelet and Skye will pay
P1,000. Choose the statement that is true.
a) As to Kitty, her cause is the pink bracelet
b) As to Skye, her object is the pink bracelet
c) As to Kitty, her cause is the P1,000
d) As to Skye, it is not clear as to what is her object

5) Kitty and Skye are best friends. Kitty needs to go abroad for a business meeting, and asked Skye to
manage her farm for her, to which Skye accepted. The two girls put their contract in writing sans
notarization thereof, hence the document only remains to be a private document. What can be said of the
contract?
a) The contract is valid as between Kitty and Skye but unenforceable as to third persons
b) The contract is unenforceable even between Kitty and Skye
c) The contract is valid for all intents and purposes
d) The contract is void and inexistent

6) Simon and Theodore entered into a contract and somehow mutual mistake was incurred as such by
both parties in such a way that the instrument does not show their true intention. Choose which is true of
the following
a) The contract is considered inexistent
b) Only Simon can ask for the reformation of the instrument
c) Simon can ask for the reformation of the instrument
d) Only Theodore can ask for the reformation of the instrument
7) Simon and Theodore entered into a contract where Simon will deliver to Theodore a farm and
Theodore will pay P1,000,000 for it. Simon has two farms. A coconut farm worth P800,000 and a mango
farm valued at P1,200,000. All the while, Theodore thought that he is buying the mango farm of Simon,
while Simon thought that he is selling the coconut farm to Simon. What can be said of the contract?
a) There must be a proper interpretation thereof to render the contract effectual
b) The proper interpretation must be for a sale of the coconut farm since it involves the least transmission
of rights
c) The proper interpretation must be a sale of the mango farm since such provides a better proximity to
the contract price
d) There is no contract

8) Simon, 17 years old, entered into a contract with Theodore, 18 years old, for the sale of Simon’s
coconut farm. The farm has a value of P1,000,000, yet Simon is willing to sell it to Theodore for only
P650,000. What can be said of the contract between the two friends?
a) The contract is rescissible since the farm is sold for a price that causes economic injury by more than a
quarter of the value thereof
b) The contract is void since there is inadequacy of the price for which the farm was sold
c) The contract is valid although it can be avoided at the behest of Simon
d) The contract is valid for all intents and purposes

9) Simon is 17 years old and owner of a piece of land valued at P1,000,000. Theodore is also 17 years
old and already has savings in the bank amounting to P1,000,000. The two are best friends and very like-
minded. One day, Simon offered to sell his land to Theodore who is willing to buy it. Simon named the
price at P850,000 which price was accepted as such by Theodore. Which is NOT true of the contract?
a) The contract is valid
b) The contract is unenforceable against third persons
c) The contract is unenforceable even between Simon and Theodore
d) The contract is void

10) Simon is 17 years old and owner of a piece of land valued at P1,000,000. Theodore is also 17 years
old and already has savings in the bank amounting to P1,000,000. The two are best friends and very like-
minded. One day, Simon offered to sell his land to Theodore who is willing to buy it. Simon named at
price at P850,000 which price was accepted as such by Theodore. A few days later, the guardian of
Theodore gave consent to the contract. Which is NOT true of the contract?
a) The contract is unenforceable
b) The contract is voidable
c) The contract is valid
d) The contract is defective

11)Simon owns a very small piece of land that has a value of around P350. Simon offered it for sale to
Theodore who is willing to buy it at such price. The parties did not put the contract in writing although
Theodore delivered to Simon the amount of P250 as a down payment for the sale. Which of the following
is true?
a) The contract is valid although rescissible because of the inadequacy of the price
b) The contract is valid although unenforceable since it qualifies under the Statute of Frauds
c) The contract is valid and enforceable
d) The contract is void and inexistent

12) Simon owns a very small piece of land that has a value of around P350. Simon offered it for sale to
Theodore who is willing to buy it at such price. The parties did not put the contract in writing since they
are close friends and already knew each other for a long time. Which of the following is true?
a) The contract is void since the sale of the real property did not follow the correct form
b) The contract is unenforceable since a sale of real property must be in writing in order to be enforceable
c) The contract is valid and enforceable since the value of the property is less than P500
d) The contract is valid for all intents and purposes

13) Clarabelle has a piece of coconut farm. She wanted to sell the farm but could not find a buyer who is
willing to pay P1,000,000 for it. She then asked her good friend Coco Lucca to sell her farm for and on her
behalf, which Coco Lucca accepted. The girls put their contract of agency in writing. Coco Lucca was then
able to find a buyer in Goofy who paid the exact amount of P1,000,000 for it. The contract of sale is in
writing, although only contained in a private document. What can be said of the contracts?

a) The contract of sale is unenforceable while the contract of agency is valid

b) The contract of sale and the contract of agency are both valid and enforceable between the parties and
against third persons
c) The contract of sale and the contract of agency are both valid and enforceable, although the contract of
sale is enforceable only between Clarabelle and the buyer who is Goofy
d) The contract of sale is valid while the contract of agency is void

14) Simon owns a mango farm which he is willing to sell to Theodore who is also willing to buy the same.
In the offer made by Simon, the selling price was listed as P1,000,00. The intention of Simon was to sell it
for P1,000,000, but there was an inadvertent omission of one zero (o). When Theodore read the
document, his understanding is that the selling price is only P100,000 since all in all, the offer price, as
written only had six (6) zeroes. What can be said of the contract?
a) The contract is voidable
b) The contract is valid although unenforceable
c) The contract is valid for all intents and purposes
d) The contract is inexistent

15) More than ten (10) years ago, Minnie borrowed P10,000 from Coco Lucca which she forgot to pay. At
this time and as of this point, the obligation of Minnie had already been extinguished through prescription.
Minnie then subsequently won P1,000,000 from the lottery and suddenly remembered her loan from Coco
Lucca. She then approached Coco Lucca and paid her the P10,000 which payment was received
wholeheartedly. A few days from the day of payment, Minnie was informed by Daisy that she should not
have paid the loan since the obligation therefor had already prescribed. Can Minnie get back the P10,000
from Coco Lucca?
a) No, because of natural obligation
b) Yes, because of natural obligation
c) Yes, because of civil obligation
d) No, because there was no more obligation