LAW ON SALES

ANSWER AND EXPLAIN

1.What statement is correct?

a.Conditions are express or implied; warranties are suspensive or resolutory

b.Breach of conditions result in damages; breach of warranties prevent the formation of the contract

c.Express warranties are those part of a contract of sale because they are provided for by law

d.Implied warranties form part of the contract of sale

2.X sold a brand new Toyota Vios to Y for P100.00. Z, the brother of X, seeks to have the sale annulled because he wants the car to remain in the family. Z says the sale is void because it is impossible for the car's value to be only P100.00. Is the transfer from X to Y void?

a.Yes, because the price is simulated and therefore Y can be compelled to return the car to X

b.Yes, because Z's consent is needed before X can transfer the car to Y

c.No, because while the sale is void, X can still show that the transfer was, in reality, a donation

d. No, because cars harm the environment and X, Y, and Z should all use bikes instead

3.X sold a house and lot to Y and Y began occupying it. Z then filed a case against Y to evict him from the property, saying it belonged to him. Y now filed a case against X for breach of warranty against eviction. Will Y win

a.No, because warranty against eviction was not stated in the contract

b. No, because it is premature, as Y is not a party to Z's case and there is no final judgment yet

c. Yes, because the seller warrants that the buyer will not be evicted from the property sold

d. No, because this is a mere trespass and not a disturbance in law

4.The following are the warranties of a person who for value negotiates or transfers a document of title by indorsement or delivery, except:

a.That he has a legal right to negotiate or transfer i

b.That the original seller possesses capacity to transfer

c.That he has knowledge of no fact which would impair the validity or worth of the document

d.That the document is genuine

5.X, the lawyer of Y in a case of foreclosure of mortgage of a house & lot, bought said house and lot in the course of trial, on behalf of Y. A, the owner, seeks to have the sale annulled, saying that the lawyer is prohibited from buying properties subject of litigation which the lawyer is handling. Is A correct?

a.No, because lawyers are allowed to buy and own property

b.Yes, because it is unfair to A as he should have the right to first buy the property

c.Yes, because lawyers are prohibited from buying property subject of litigation he is handling, as this is against public interest

d.No, because X bought the property on behalf of Y

6.X sold a house and lot to Y and Y began occupying it. Z jumped over the fence, pulled Y out, and began occupying the property. Y now filed a case against X for breach of warranty against eviction. Will Y win?

a.No, because it is premature, as Y is not a party to Z's case and there is no final judgment yet

b.No, because warranty against eviction was not stated in the contract

c.Yes, because the seller warrants that the buyer will not be evicted from the property sold

d.No, because this is a mere trespass and not a disturbance in law

7.Where the parties purport a sale of specific goods, and the goods without the knowledge of the seller have perished in part or have wholly or in a material part so deteriorated in quality as to be substantially changed in character, the buyer may at his option treat the sale as the following, except:

a.None of the above

b.As avoided

c.As valid in all of the existing goods or in so much thereof as have not deteriorated

8.The following are instances when ownership passes to the buyer in case goods are delivered on approval, except:

a.When the seller signifies his approval

b.When the time expires to return the goods and the buyer does not return them

c.When the buyer does any act adopting the transaction

d.When no time for return has been set, and a reasonable time expires and the buyer does not return the goods

9.X sold 3 sacks of rice to Y at the rate of P100.00 plus the prevailing rate of corn in Nepa-Q Market on 15 April 2023. Is the sale valid

a.Yes, because there was a definite reference for the fixing of the price

b.No, because the fixing of the price was left to the sole discretion of X

c.Yes, because the price can be determined by a third person

d.No, because the object is not determinate

10.X sold a factory to Y for Php1,000,000.00 in 60 equal installments. Y paid for 26 months, but failed to pay on the 27th and 28th month. On the 29th month, Y tried to give payment for the missed and current month, but X instead gave Y a notice of cancellation, saying that the transaction is now cancelled and Y must vacate. Decide

a.X is correct, failure to pay is a breach of contract which entitles him to rescind the contract

b.Both are correct, and X must accept the money and Y accept that the contract is now cancelled

c.Y is correct, because under the Maceda law, he has a grace period to pay

d.No one is correct, because the Maceda law does not apply, but there is no stipulation for automatic rescission

11.X sold a 1997 Toyota Vios with Chassis No. 1234 to Y on 12 January 2020. Y took possession of the car but forgot to register the deed of sale. X sold the same car to Z on 15 June 2020 and Z registered the deed of sale. Who has the better right?

a.None of them, give it to Atty. Javier

b.Z, because he was the first to register

c.X, because he is the original owner

d.Y, because he was the first to possess

12.The following are the obligations of the vendor, except:

a.Warrant against eviction and hidden defects

b.Deliver the thing

c.Take care of the thing with extraordinary diligence, unless otherwise stipulated

d.Transfer ownership

13.What statement is false?

a.A document of title in which it is stated that the goods referred to therein will be delivered to the bearer, or to the order of any person named in such document is a negotiable document of title

b.A negotiable document of title may be negotiated by delivery where by the terms of the document the carrier, warehouseman or other bailee issuing the same undertakes to deliver the goods to the bearer

c.None of the choices

d.A negotiable document of title may be negotiated by the indorsement of the person to whose order the goods are by the terms of the document deliverable

14.X sold a residential house and lot to Y for Php1,000,000.00 in 60 equal installments. Y paid for 26 months, but failed to pay on the 27th and 28th month. On the 29th month, Y tried to give payment for the missed and current month, but X instead gave Y a notice of cancellation, saying that the transaction is now cancelled and Y must vacate. Decide

a.No one is correct, because the Maceda law does not apply, but there is no stipulation for automatic rescission

b.X is correct, failure to pay is a breach of contract which entitles him to rescind the contract

c.Both are correct, and X must accept the money and Y accept that the contract is now cancelled

d.Y is correct, because under the Maceda law, he has a grace period to pay

15.X sold a house and lot to Y on 12 January 2020. Y took possession of the property but forgot to register the deed of sale. X sold the same property to Z on 15 June 2020 and Z. Y learned of the subsequent sale, then filed a case against Z. Upon learning of the case, Z had the property registered in his name. Who has the better right?

a.None of them, give it to Atty. Javier

b.Z, because he was the first to register

c.Y, because he was the first to possess

d.X, because he is the original owner