Obligation Questions and Answers
Obligation Questions and Answers
A clause providing that the mortgagee will automatically own the property mortgaged if the
debt is not paid at maturity is
Pactum Commissorium
2. The following instances will render an offer ineffective before acceptance is conveyed. Which
one will not? When one of the parties
3. This refer to those found in certain contracts unless set aside or suppressed by parties such
as warranty against eviction and warranty against hidden defects in a contract of sale
Deed of donation
Principal contract
6. This refer to the period in which an insane person temporarily regains his sanity and is
capable of perfect enjoyment of his mental faculties for the time being
Lucid interval
7. Aside from fraud and undue influence, the following are the vices of consent, except
Dealer's talk.
8. This refers to a contract whereby the offerer gives the offeree the privilege to purchase or
not a certain object for a fixed price at any time within an agreed period for a fixed price.
Option contract
9. A contract where the cause with respect to each contracting party is the prestation or the
promise of a thing or service by the other issingle choice.
An onerous contract
10. This condition occurs when a person believes that a condition or event exists when it does
not
Mistake of fact
11. The contracting parties may establish such stipulations, clauses, terms and conditions as
they may deem convenient, provided they are not contrary to law, morals, good customs,
public order, or public policy. This characteristics of a contract is referred to as:
Liberality of contract
13. It refers to an ambiguity that does not readily appear in the language of a document, but
arises from a collateral matter when the document’s terms are applied or executed
Extrinsic abiguity
14. A delivered his bracelet to B for B’s necklace. No written agreement was signed by the
parties. Which of the following is appropriate description of the contract between A and B?
15. On June 1, 2010, S offered to sell his only car to B for P100,000.00. B accepted the offer by
mailing his letter of acceptance on June 10, 2010. On June 12, 2010, B revoked his previous
acceptance and mailed his letter of revocation on the same date. S received the letter of
revocation on June 15, 2010
The contract was not perfected because at the time the acceptance was received, the
parties were no longer of one mind.
16. Contracts are generally effective only between the parties, their assigns and their heirs
Relativity of contract
17. The following contracts are not perfected until the delivery of the object of the obligations,
except
Sale
18. The bargaining point, that is, when negotiation is in progress (stage in the life of a
contract)Single choice.
Conception
19. A contract where both parties are required to do or to give something is known as a
Bilateral contract
20. The following cannot be the object of a contract, except:
Mutuality of contract
22. Refers to those that are perfected by the delivery of the object of the contract such as
depositum, pledge and commodatum
Real contract
23. It is the meeting of minds between two persons whereby one binds himself, with respect to
the other, to give something or to render some servicesingle choice.
Contract
24. The contracting parties may establish such stipulations, clauses, terms and conditions as
they may deem convenient provided they are not contrary to law, morals, good customs, public
order or public policy. This is known as a principle of:
Liberty of contract
25. Rockman and Company published an advertisement in the newspapers which reads as
follows “INVITATION TO BID: Construction of the company’s warehouse located at 123 Luzon
Street, Sta. Quiteria, Quezon City.” The advertisement also included the specifications of the
warehouse to be constructed. Three companies submitted their bids: ABC Company, with a bid
price of P4,500,000.00; DEF Company, P4,750,000.00; and GHI Company, P5,000,000.00. After
considering the financial capability, reputation and experience of the bidders, the kind and
quality of materials to be used and other factors, Rockman and Company accepted the bid of
DEF Company. ABC Company, the lowest bidder, now questions the award made by Rockman
and Company to DEF Company which submitted a higher bid.
The award to DEF Company is valid because Rockman and Company was not bound to
accept the lowest bidder.
Contract of pledge
28. A stipulation in favor of a third person
29. A delivered his van to B for the latter’s use for one week without any compensation. The
cause of the contract is
The generosity of A
30. A meeting of minds between two persons whereby one binds himself with respect to the
other to give something or to render some service is known as:
Contract
Consent of the contracting parties, object certain, cause or consideration and delivery of
the object
32. P appointed A as his agent to sell P’s only Honda Civic car for P400,000.00 cash. On
November 7, 2010, A, pursuant to the authority granted to him by P, offered to sell the car to B
at the price of P400,000.00. B accepted the offer on November 8, 2010 by sending a letter of
acceptance to A, which letter of acceptance was received by A on November 9, 2010. On
November 10, 2010, A informed P that B had accepted the offer.
The contract was perfected on November 9, 2010 when A received the letter of
acceptance.
34. A contract where the fulfillment is dependent upon the chance, so the values may vary
because of the risk or chance.
Aleatory
35. The following are considered in determining whether undue influence deprive the party the
reasonable freedom of choice, except:
Simplicity of contract
37. The following are requisites for a creditor to exercise accion pauliana, except:
38. Contracts take effect only between the contracting parties, their assigns and heirs, except in
cases where the obligations and rights arising from the contract are not transmissible by their
nature, or by stipulation, or provision of law. This principle of contract is known as:.
Relativity of contract
Accidental elements
42. Refers to the immediate, direct, most proximate and essential reason or the driving force
why a party enters into a contract.
43. D borrowed P100,000.00 from C. The obligation is secured by a mortgage on D’s land and
building. C registered the mortgage with the register of Deeds. Thereafter, D sold the land and
building to X who was not personally aware of the existence of the mortgage at the time of sale
since only the photocopy of the transfer certificate of title which did not yet contain the
annotation of the mortgage was shown to him . It was only when he went to the Register of
Deeds to register the sale of the land and building to him that he learned of the mortgage.
C can collect from D and if D cannot pay, C can foreclose the mortgage although the land
and building are now owned by X.
44. When there is doubt whether the intention of the party is either a deed of absolute sale or
real estate mortgage, the doubt should be resolve in favor of
45. Obligation arising from contracts have the force of law between the contracting parties and
should be complied with in good faith. From perfection, the parties are bound not only for the
fulfillment of what has been expressly stipulated but also to all the consequences which,
according to their nature, may be in keeping with good faith, usage and law. This is known as
the principle of:
46. This refers to the remedy allowed by law to the contracting parties and to third person/s to
repair the damage cause them by a contract
Rescission
48. It means that stipulations in the contract are binding only upon the parties and their
successors.
Relativity of contract
49. It exists when a person takes improper advantage of his power over the will of another
depriving the latter of a reasonable freedom of choice.
Undue influence
50. Mistake in three of the following will make a contract voidable. Which one will not?
51. The following persons cannot give his/her valid consent, except:
A 15-year old genius students who just graduated summa cum laude for BS Accountancy
at University of the Philippines
52. A sold his land to B. The sale was made orally. B paid the agree price. B wanted to have the
sale registered but he needs a public instrument. Which is correct?
B may compel A to execute the public instrument because the sale is valid.
55. It is present when one of the contracting parties is compelled by a reasonable and well-
grounded fear of an imminent and grave evil upon his person or property, or upon the person
or property of his spouse, descendants, and ascendants, to give his consent.
Intimidation.
Real contracts
57. Persons specially disqualified by law to enter into a contract are the following, except
58. These contracts are those where there is an exchange of valuable consideration between
parties such as contract of sale and barter
Onerous contracts
59. 3 The elements of a contract without which a contract would not exist are known as:
Accidental elements
Void
62. Elements that accompany certain contracts unless set aside or suppressed by the parties are
known as:
Natural elements
64. Refer to fraud done that without it, consent would’ve not been given. This renders the
contract voidable
Causal fraud
65. A owes B P10,000 due on March 10, 2010. A owes B P8,000 due on March 11, 2010. A
obliged himself to deliver to B a cow valued at P6,000 on March 12, 2010. On March 13, 2010, a
paid B P10,000. If A makes an application of payment
The P10,000 may be applied either to the first debt or second debt
66. This refers to a contract that, by mutual agreement, does not express the true intent of the
parties. It does not have legal effect and does not create juridical tie between the parties
Simulated contrac
67. It refers to the action where the creditor files an action in court for rescission of acts or
contracts entered into by the debtor designed to defraud the creditor.
Accion pauliana
68. This refers to mistake where the legal effect of an agreement of the real purpose of the
parties is frustrated and the same is mutually committed by parties due to lack of
understanding on the complexities of the consequences of the provisions of law.
Mistake of law
69. Acceptance of an offer made by letter or telegram shall bind the offeror. From the time the
70. Three of the following instances will render an offer ineffective before acceptance is
conveyed. Which one will not?
71. A sold to B his cow for P5,000. No date is fixed by the parties for the performance of their
respective obligations. The obligation of A is
72. The point where the parties have performed their respective obligations and the contract is
Terminated
Consummation
73. They refer to the elements that may be stipulated by the contracting parties
Accidental elements
74. Which of the following is an indivisible obligation?
To give a rendition tonight of Handel’s “Messiah” in a concert at the Folks Arts Theater.
75. When the debtor binds himself to pay when his means permit him to do so, the obligation is
76. The substitution or change of an obligation by another, which extinguishes or modifies the
first
Novation
77. D owes C P20,000.00 due on March 15. C, on the other hand, owes D the following debts:
P8,000.00 due on March 1,P3,000.00 due on March 8, P5,000.00 due on March 14. On March
12, C assigned his right to T with notice to D but with D not giving his consent to the
assignment. On March 15, T can collect from u
P9,000.00.
78. The meeting in one person of the qualities of creditor and debtor with respect to the same
obligation.
Confusion
79. S sold his only horse to B for P10,000.00 cash. The parties agreed that S shall deliver the
within one week from their agreement. Nothing is mentioned in the agreement on how the
horse will be cared for by S before delivery.Single choice.
S must take care of the horse with the diligence of a good father of a family before
delivery.
80. A and B are the owners of adjacent poultry and piggery farms. One day, B got sick and failed
to visit the farm. When A noticed that B was not again around during the second day, he
himself took care of the animals by feeding them and cleaning the pig and poultry pens. A did
this for the next three days until B returned. A incurred necessary and useful expenses
amounting to P5,000.00 in the process. Under the circumstances, B is obliged to reimburse A
for such expenses which the latter incurred by reason of:Single choice.
Negotiorum gestio
82. Statement 1. If the law or contract does not state the diligence which is to be observed in
the performance of the obligation, neither party is liable for negligence.
Statement 2. If a party is negligent and at the same time in bad faith, he shall be liable for
damages by reason of fraud.
False; True
83. Hilario, husband, and Wynona, wife, are legally separated. By order of the court which
decreed the legal separation, Hilario is obliged to give a monthly support of P20,000.00 to
Wynona payable in advance within the first five days of the month. Wynona owes Hilario
P20,000.00 by way of loan. On the other hand, Hilario has not yet given Wynona’s support of
P20,000.00 for the preceding month and another P20,000.00 for the present month. All the
debts are already due. Based on the foregoing facts, which of the following statements is
incorrect?
If Wynina demands her support for the current month, Hilario may claim compensation
as regards the loan that Wynona owes him.
84. In obligations with a penal clause, the creditor can recover damages, and interest apart
from the penal clause:
85. Substitution of debtor where the initiative comes from the debtor.
Delegacion
86. The right of C before the delivery, on one hand, and his right after the delivery, on the other
hand, of the agricultural land and its fruits, to him are referred to as:
When the obligation is to deliver a determinate thing and there was a stipulation as to
the liability of the debtor in case of loss due to fortuitous events
89. Dominico and Domingo are jointly and severally liable to Crispino for P100,000.00. The
obligation is due on June 30, 2010. On June 25, 2010, Domingo paid the whole amount of the
note to Crispino. If Domingo reimburses Dominico on July 15, 2010, Dominico is entitled to
receive from Domingo:
90. Legal compensation shall not be proper in three of the following cases. Which is the
exception?
Bank deposit
92. The delivery of mercantile documents such as checks will produce the effect of payment:
When through the fault of the creditor they have been impaired.
93. Three of the following contracts are void. Which one is not?
Oral contract of partnership of three partners and capital contribution is more than
P3,000 in cash
95. The act of offering the creditor what is due him together with a demand that the creditor
accept the same.
Tender of payment
96. D has a grains warehouse in Davao, while C has a grains in Cebu. D borrowed10sacks of rice
worthp10,000.00 from C for D's customer in Cebu. Later, C borrowed sacks of rice which was
also worth P10,000.00 from D for C's in Davao. Both the obligations are already due. Transport
costs to Davao amount to P1,000.00, while those for Cebu amount to P800.00.
D and C need not pay each other since their debts compensated each other, except for
the delivery charges which C must pay to D in the amount of P200.00(P1,000.00 less
P800.00).
97. Dolores borrowed P15,000.00 from Consuelo. On due date, Dolores was not able to pay but
she promised to give Consuelo a specific ring, a specific bracelet, or a specific necklace, in
payment of the debt. Consuelo accepted the offer of Dolores. What kind of obligation is the
new obligation of Dolores?
Alternative obligation
Statement 2. Accessories are not necessary to the principal thing but both must go together.
100. Which of the following condonations will not extinguish the debtor’s obligation.
The condonation and the acceptance are made orally with the creditor delivering to the
debtor simultaneously the promissory note amounting to P10,000.00.
101. P took a public bus in going to his office. Although P paid his fare, the bus conductor does
not issue to him a ticket. Along the way, the met an accident causing a slight injury to P and
other passengers. If P is to recover damages from the bus owner, the source of the bus owner’s
liability is:
Contract
102. D is indebted to C for P20,000.00 which is due on June 10. C owes D 15,000.00 which is
due on June 5. On June 8, C assigned his credit rights to T. D gave his consent to the assignment
but did not reserve his right to the compensation. On June 10, how much may T collect from D?
P20,000.00
103. An obligation where various prestations are due but the performance of all of them is
required in order to extinguish the obligation is known as:
Conjunctive obligation
104. The debtor shall lose the right to make use of the period in the following cases, except
when he
105. When a third person assumes the payment of the obligation even without the knowledge
and consent of the debtor but with the consent of the creditor
106. A, B and C are liable, in solidum to X for P12,000.00. X renounced the share of A who
accepted it. Later, B becomes insolvent.
107. On a certain year, D was obliged under a contract executed on March 1 to deliver an
agricultural land to C on April 1. D, however, actually delivered the land and the fruits thereof
to C on May 1. C had the right to the fruits of the agricultural land beginning on:
April 1
108. A binds himself to give B, P1,000 if B sells A’s car and P2,000 if B will kill C.
109. S, a supplier of fresh fish from Lucena City hired T, the owner of a trucking company, for a
fee of P3 000 to bring the fish of S to the Dampa Market in Paranaque City which ordered the
fish for a price of P20 000. In so far as S is concerned, his prestation in his contract with T is
Personal
111. D stole the carabao of C. D was arrested, tried in court and convicted. Aside from being
sentenced to a prison term, D was also ordered by the court to return the carabao. However,
the carabao died before D could deliver it to C.
112. Which of the following obligation is a pure obligation and is demandable at once?
D to give C his car. No mention is made when D shall give the car.
113. .Action where a person in possession of certain property may bring an action against the
conflicting claimants to compel them to interplead and litigate their several claims among
themselves.
Interpleader
114. On June 1, 2009, Demetrio obtained a loan of P100,000.00 from Cornelio. The loan, which
is payable on or before June 1, 2010, is secured by a chattel mortgage on Demetrio’s brand-new
Toyota car with plate number XYZ 123. On February 1, 2010, while Demetrio was opening the
trunk of his car at the parking lot of a grocery store to place the groceries he had just
purchased, three unidentified men approached him and took his car at gunpoint. He reported
the carnapping to the authorities but his car has not been recovered.
Cornelio may demand immediate payment of the loan unless Demetrio gives another
security therefore.
115. D owes C the following debts: P6,000.00 due on January 1; P6,000.00 due on January 15;
P6,000.00 due on January 31; P6,000.00 due on February 15; P6,000.00 due on February 28;
and P6,000.00 due on March 15. All the debts are unsecured except the one on February 28.
The parties stipulated that C may demand payment on or before due date of each debt.
Assume that today is February 16. D, however, has not yet paid any of the debts. He has in
possession P6,000.00 which he intends to pay C.
D may apply the payment to any of the four debts that have become due as of today,
February 16
Delay, as a rule, exists, when the debtor does not perform his obligation on the date it is
due.
117. B ordered 10 boxes of "X" shirts worth P2,000.00 per box from S paying immediately the
total, price of P20,000.00. While inspecting the goods after their delivery to his store,
discovered that one box was missing. Upon being informed, apologized for the error and
promised to refund the price ofp2,000.00 within three days as there was no more stock of "X"
shirts available. In the meantime, B ordered and received from Sone box of "Y" shirts which was
also worth P2, 000.00 promising to pay the same within three days. On the third day, assuming
that S had not yet refunded the price of the undelivered "X" shirts to B, B need not pay S the
price of "Y" shirts by claiming:
Compensation.
118. D obtained a loan from C in the amount of P50,000.00. Unable to give cash on due date in
payment of his loan obligation, D proposed to C that he would be giving instead his diamond
ring to settle his debt. C agreed and accepted the ring from D. The new agreement between D
and C involved both:Single choice.
119. Which of the following is not a proper remedy for the creditor.
120. Novation which changes the object and parties of the obligation.
Mixed
121. M executed a promissory note payable to P for P100,000.00. The note, which bears
interest at 2% per month, is payable after 60 days. On the date of maturity, P proceeded to M’s
place to collect but when M demanded the presentation of the promissory note, P could not
present it claiming that it had been lost. M is able and willing to pay the whole amount due
including the interest but he is at loss on what to do because P does not have the instrument.
On the other hand, if he does not pay the amount due, the interest on the principal will
continue to accrue. If you were M, the remedy that you will likely avail yourself of is:
Consignation
122. A is oblige to deliver his only car to B on November 20, 2011. If A does not deliver, and on
November 22, 2011, a typhoon destroys the car, which is correct?
123. A is obliged to give B his Mitsubishi, 4-door sedan Lancer with plate number ABC 123 on
September 30, 2009. On October 10, 2009, A did not yet deliver the car which was totally
destroyed by an earthquake on such date. Is A still liable?
No, the obligation is extinguished. The specific thing was lost due to fortuitous event
and no demand to deliver was made by B.
124. One is not a requisite in order that obligation shall be extinguished by loss or destruction
of the thing due:
126. One of the following does not apply to payment by cession. Which is it?
127. The following statements pertain to either payment by cession or dacion en pago.
129. Maila made a non-negotiable promissory note with Pia as payee. Pia assigned the note to
Aiko, Aiko signed the note to Bea, Bea assigned the not to Carmina, Carmina signed the note to
Helen, and Helen assigned it back to Maila.
130. P took a public bus in going to his office. Although P paid his fare, the bus did not issue him
a ticket. Along the way, the bus met an accident causing a slight injury to P and other
passengers. If P is to recover damages from the bus owner, the source of the bus owner’s
liability is
Contract
When a third person, not interested in the obligation, pays with the approval of the
creditor.
132. Under a contract executed on November 1, 2010, D obliged himself to give a specific horse
to C on December 10, 2010. On December 8, 2010, C demanded the delivery of the horse but D
did not comply. The following day, the horse was struck by lightning and died instantly.
The obligation of D is extinguished because the loss is due to fortuitous event and D was
not in default.
133. Which of the following is not a proper remedy for the creditor?
To compel the debtor to perform the obligation, if the obligation is an obligation to do.
134. D borrowed P100,000.00 from C. the parties agreed at the time the obligation was
constituted that should D so desire, he may give his agricultural land to C by way of dacion en
pago to pay his loan obligation on due date. The obligation of D to C is:
A facultative obligation
136. D promised to give C 10 sacks of rice when X, C’s father, dies. The obligation of D to C s:
137. S sold 100 bottles of imported “Fundador” brandy to B who paid immediately the price
thereof amounting to P20,000.00. S promised to deliver the brandy to B within one week from
their agreement. On the agreed date of delivery, S delivered to B 100 bottles of fake
“Fundador” brandy. The contract between S and B is:
Valid
138. Alternative obligation and facultative obligation are similar in which of the following
respects?
The obligation becomes a simple obligation once the choice of the prestation is made
and communicated.
139. Dolores borrowed P15,000.00 from Consuelo. On due date, Dolores was not able to pay
but she promised to give Consuelo a specific ring, a specific bracelet, or a specific necklace, in
payment of the debt. Consuelo accepted the offer of Dolores. Assume that before Dolores
could deliver any of the ring, bracelet or necklace, the ring and the bracelet were lost
successively through the fault of Dolores. In this case:
Dolores may deliver the necklace to Consuelo without any obligation to pay damages.
Dation in payment
141. .Anna Almeda, Belinda Bersola, and Claudia Cabrera executed the following promissory
note:
“ I promise to pay Dolores Dominguez or order the sum of P30,000.00 on June 30, 2010.
(Sgd.) Anna Alameda
(Sgd.) Belinda Bersola
(Sgd.) Claudia Cabrera”
On June 30, 2010, Dolores Dominguez can collect from Anna Almeda:
P30,000.00
143. Prime Engineering Review Center (PERC) stated in the leaflets it distributed last January
that any reviewee who places first in licensure examinations for engineers this year will receive
a cash prize of P150,000.00.
144. It is a mode of extinguishing an obligation when two persons in their own right are
creditors of each other.
Compensation
145. Where two or more prestations have been agreed upon but only one is due, the obligation
is alternative. The right of choice, belongs
To the debtor
146. A and B are joint debtors of C and D, joint creditors, to the amount of P1,000 – C can
demand
148. A possessor of a thing as an owner retains possession no longer as an owner, but in some
other capacity
Natural obligation