Business Law Law on Obligations MIDTERM EXAMINATION FIRST PART I. MULTIPLE CHOICE. Write the letter of your best answers only, all caps. 1. A type of condition which once upon fulfillment, it will give rise to an obligation. a. Suspensiondition c. Potestative Condition b. Resolutory Condition d. None of the above 2. In the following instances, demand is no longer necessary for one to be considered in legal delay EXCEPT a. When the demand would be c. From the nature of the obligations it useless appears that the designation of the time was the controlling motive for the establishment of the contract b. Law expressly so declares d. None of the above 3. This is a kind of obligation that is demandable at once. a. Conditional Obligation c. Solidary Obligation b. Joint Obligation d. Pure Obligation 4. This is a future and uncertain event. a. Obligation c. Condition b. Potestative d. Period 5. The following are indeterminate things EXCEPT a. a 1995 Toyota Car c. The money that I gave you b. a Fossil watch d. 10 cavans of Angelica rice 6. The following are liable for fortuitous events EXCEPT a. Those who have assumed risks c. Insurance Companies b. Those who have complied in the d. Those who are in delay obligations 7. A type of condition which upon fulfillment, it extinguishes the obligation. a. Suspensiondition c. Potestative Condition b. Resolutory Condition d. None of the above8. The following are specific things EXCEPT a. Iwatch Series 6 that I am wearing c. Lenovo Laptop inside my car b. 5 pcs. Of Macau Milktea d. my cat named "Agnat" 9. The following are accessions EXCEPT a. door of a house c. dividends accruing from shares of stocks b. air-conditioner in a car d. trees on a land 10. These are kinds of obligations EXCEPT a. To not give c. To not to do b. To do d. None of the above 11. This is a future and certain event. a. Obligation c. Condition b. Potestative d. Period 12. The following are accessories EXCEPT a. frame of a picture c. tools of a car b. Keyboard in a laptop d. bracelet of a watch 13. Happening of an event on determinate time. a. Negative Condition c. Positive Condition b. Resolutory Condition d. Potestative Condition 14. The following are sources of obligations EXCEPT a. Official Receipt c. Negligence b. Memorandum of Agreement d. TRAIN Law 15. The following are positive personal obligations EXCEPT a. X binds himself to construct a c. X is not permitted to construct a house house for B in his garage b. X obligates himself to pay B d. X will make B happy 16. The following are negative personal obligations EXCEPT a. X is not allowed to report to work c. You are not allowed to go outside because he is sick b. X is prohibited from engaging to d. X is obliged to give to B his own car similar kinds of business17. A condition that solely depends upon the sole will of the debtor. a. Suspensiondition c. Potestative Condition b. Resolutory Condition d. None of the above 18. A kind of period which upon arrival, obligation arises. a. Suspensioniod c. Judicial Period b. Resolutory Period d. None of the above 19. A kind of period which upon arrival, obligation is extinguished. a. Suspensioniod c. Judicial Period b. Resolutory Period d. None of the above 20. An event that will not happen at a determinate time. a. Negative Condition c. Positive Condition b. Resolutory Condition d. Potestative Condition B. TRUE OR FALSE. Write TRUE if it's correct, if it's not then FALSE. Choose wisely, it's a do or die ride. 1. If all debts are onerous with the same level of weight, application of payment shall be applied proportionately. 2. 0.10 cent is legal tender to an amount not exceeding 20.00 pesos. 3. When the fulfillment of the condition depends upon the sole will of the debtor, obligation shall be void. 1. Loss of specific thing extinguished the obligation. 5. Payment means the delivery of money. 6. As a general rule, period is presumed to be for the benefit of the debtor. 7. In dation in payment, all of the debtor's properties are being assigned to the creditor for the satisfaction of the obligation. 8. As a general rule, payment of penalty carries with it indemnity for damages and payment of interest. 9. A bounced check, since it was presented warrants the extinguishment of obligation.10. If an indeterminate thing is lost, the obligation is extinguished. 11. If the thing is improved during the pendency of the efficacy of the obligation, the debtor shall own this improvement. 12. If the undertaking is for delivery of indeterminate thing, the payment shall be made wherever the thing might be at the moment the obligation was constituted. 13. Remedies of Specific Performance and Rescission are mutually exclusive remedies. 14. A 3-year old child bought a candy, after which he ate it. Here, payment is valid. 15. If the debt produces interest, payment of the principal shall not be deemed to have been made until full settlement of interest. 16. Remedy of rescission can always be applied at all times. 17. Nullity of accessory obligation nullifies the principal obligation. 18. In payment by cession, the debtor must be insolvent. 19. Upon agreement, payment of penalty cannot be reduced. 20. In unilateral prestations, the fruits and interests are deemed to have been mutually compensated. 21. In case of suspensiondition, the creditor may before the fulfillment of the condition, recover what he has paid by mistake. 22. The debtor shall lose the right to make use of a period when he attempts to abscond. 23. Creditor can be compelled to accept partial payment. 24. As a rule, only complete payment extinguishes obligation, hence incomplete payment does not extinguish obligation. 25. Subrogation takes effect when debtor did not consent to the payment of the third party. 26. Extrajudicial expenses shall be for the account of the debtor. 27. Application of payment shall be made on the debts which are not due. 28. Tender of payment and consignation are always a twin requirement to properly effect payment. 29. Payment made by the creditor after the latter has been judicially ordered to retain the debt shall be valid as it remained to be a payment made by interested parties. 30. Upon consignation, the debtor is now free as a bird to all his obligation.MIDTERM EXAMINATION SECOND PART ESSAY. Use only three sentences and answer it with legal basis. Example: Yes, the loss of A's watch extinguishes the obligation. Under the Law on Obligations, loss of a specific thing extinguishes an obligation. Here, A's watch is a specific thing since it can be particularly designated or physically separated from all others of the same class, thus its loss extinguishes A's obligation to B. 1. A obligated himself to construct a commercial building on the lot owned by B. Subsequently, A instead of a commercial building, constructed a bungalow residential house on the lot of B with the consent of the latter. However, B had a change of heart and told A why he constructed a house despite that they have initial agreement, that a commercial building must be built. a. Now, the question is, whether or not there is a novation of agreement. Then, state your legal basis. 2. Boots owes Dora, 1k Dora indorses the PN Boots issued a PN to Swiper for the same in favor of Dora amount in payment of apple she bought from Swiper. Swiper bought bananas for the amount of 1k from the store of Boots. Instead of paying cash, Swiper indorsed the PN to Boots > > Here, in questions (a-c) no need to use three-sentence rule. But in question (d) use the three-sentence rule. a. In the illustration above, as to transaction between Dora and Boots, who is the creditor in the amount of Php. 1,000? b. As to transaction between Dora and Swiper, who is now the debtor? c. As to transaction between Swiper and Boots, who is now the creditor? d. Is the obligation of Boots extinguished? If yes, [1] how it was extinguished? [2] Was it a total or partial extinguishment