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Obligations AND Contracts TRUE OR False
Accountancy (Quezon City University)
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1. Warranty against eviction is inherent in a contract of sale; hence it is an
essential element thereof.
FALSE- it is an natural element in a contract of sale.
2. Dacion en pago partakes of the nature of a sale; hence there is more freedom in
fixing the price of the thing conveyed.
FALSE- Less freedom in fixing the price
3. A contract for a piece of work must comply with the Statue of Frauds. Accordingly,
it must be in writing to the enforceable if the price is P500.00 or more.
FALSE- The said contract even if a sale of personal property more than P500.00 is
already enforceable and not anymore subject to the Statute of Frauds because of the
earnest money that signifies the partial fulfillment of the contract. Statute of Frauds
are only applicable to executory contracts and not to fully consummated or partially
fulfilled contracts.
4. A sales contract requires the delivery of the thing sold for its perfection.
FALSE- a contract of sale is perfected at the moment there is a meeting of minds
upon the thing which is the object of the contract and upon the price the reciprocal
obligations of the parties arise.
5. If the consideration received for a thing is another thing and a monetary
consideration and the intention of the parties does not clearly appear, the contract will
be considered a contract of barter if the value of the property consideration is greater
than the monetary consideration.
TRUE
6. In a contract to sell, the full payment of the price is a suspsensive condition which
upon fulfillment will
require the execution of a contract of sale.
TRUE
7. It is not necessary that the vendor of a thing must be the owner thereof at the time
of sale as long as he
can transfer its ownership to the buyer upon delivery.
TRUE
8. The sale of hope or expectancy is a valid even if the thing hoped for does not come
into existence.
TRUE
9. If the sale of a piece of land is made through an agent, the authority of the agent
must be in writing for
the sale to be valid.
TRUE
10. In a sale by auction, any bidder may retract his bid before the sale is perfected.
TRUE
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11. If a “by-bidder” or “puffer” is employed by a seller without notice in sale by
auction, the sale may be
treated as fraudulent by the buyer.
TRUE
12. The ownership of the thing sold is transferred upon the perfection of the contract
of sale.
FALSE- Upon the perfection of the sale, the seller assumes the obligation to transfer
ownership and to deliver the thing sold, but the real right of ownership is transferred
only "by tradition" or delivery thereof to the buyer.
13. A unilateral promise to buy or sell a determinate ting at a certain price is binding
upon the promissory
if the promise is supported by a consideration distinct from the price.
TRUE
14. Earnest money is part of the purchase price of a thing; hence, deductible from the
total selling price.
TRUE
15. In sale of personal property payable in installments, the seller may exact
fulfillment of the buyer’s
obligation when the buyer defaults in the payment of one or more installments.
TRUE
16. In sale of real property where the buyer has defaulted after paying at least 2 years
installments, he shall be entitled to pay, without additional interest, the unpaid
installments due within the grace period earned by him.
TRUE
17. The purchase by a guardian of the property of the person under his guardianship is
valid.
FALSE- Accordingly, the guardian may not purchase the ward’s property for sale
which is under his guardianship. The reason for such prohibition is that, public policy
prohibits the transactions in view of the fiduciary relationship involved.
18. The buyer shall be entitled to the fruits of the thing sold from the time of the
perfection of the contract.
TRUE
19. The delivery of incorporeal property may be made through the exercise by the
vendee of his rights with
the consent of the vendor.
TRUE
20. If goods are sold on “sale or return”, the risk of loss of the thing sold remains with
the seller after its delivery to the buyer.
FALSE- The risk of loss of the thing due must be in the buyer.
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21. In “sale on approval”, the buyer becomes the owner of the thing upon delivery, but
he may revert such ownership to the seller by returning it.
FALSE- Ownership is transferred to buyer upon delivery but he has the option to
revert such ownership to the seller. ... The consideration paid for the purpose of
holding one to his promise to buy or sell a determinate thing for a certain period of
time, which consideration is separate and distinct from the purchase price.
22. The delivery of specific goods to a carrier or other bailee for the purpose of
transmission to the buyer
generally transfers ownership of the goods to the buyer.
TRUE
23. When a thing is purchased from the merchant’s store, fair or market, the buyer
acquires title to the thing although the seller may have stolen it or acquired it from a
thief.
TRUE
24. A warehouse receipt is also a contract between the warehouseman and the
depositor of the goods.
TRUE
25. A bearer document of title becomes an order document of title if it is specially
indorsed.
TRUE
26. The delivery of an order document of title without any indorsement does not
constitute negotiation.
TRUE
27. A negotiable document of title becomes non-negotiable if it is stamped with
the mark “non-negotiable”.
FALSE- a mark will have no effect on the instrument and it remains to be negotiable.
28. If the goods sold are in the possession of a third person, the seller is deemed to
have delivered the goods to the buyer if the third person acknowledges to the buyer
that he holds the goods in the buyer’s behalf.
TRUE
29. If a period has been fixed for the payment of the price which has not yet arrived,
the seller in the
meantime is bound to deliver the thing sold.
TRUE
30. An unpaid seller exercising his right to resell the goods may buy the goods either
directly or indirectly.
FALSE- not directly or indirectly. The seller has the right to lien or stoppage in
transitution.
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31. When an unpaid seller exercises his right of stoppage in transit, the contract of
carriage ceases, the carrier becoming liable as a depositary.
TRUE
32. If real estate is sold for a lump sum, the vendor is bound to deliver all that is
included within the
boundaries stated in the contract although the actual area is greater that than stated in
the contract.
TRUE
33. If the same immovable is sold to two or more persons who are all in good faith,
ownership shall belong to the buyer who first paid its price.
FALSE- the same things should have been sold to different vendees, the ownership
shall be transferred to the person who may have first taken possession thereof in good
faith if it should be movable property. If it is immovable property, the ownership shall
belong to the person acquiring it who in good faith recorded it in the Registry of
Property.
34. In order that the buyer may enforce the seller’s liability for breach of warranty
against eviction, the judgment depriving the buyer of the thing must first be appealed
by the buyer.
FALSE
35. The vendor’s liability for breach of warranty against eviction may be validly
waived by the vendee. However, the vendor will still be liable if the waiver was made
by the vendee without knowledge of the
risks of eviction.
TRUE
36. As a rule, the vendor shall not be liable for a non-apparent easement that is
recorder in the Registry of Property.
TRUE
37. The vendor shall be liable generally for any defect on the thing sold even if he was
not aware thereof.
TRUE
38. When animals are sold as a pair, the vendee may ask for the rescission of the sale
of both animals although only one of them suffers from redhibitory defect.
TRUE
39. The sale of animals suffering fro contagious diseases is voidable.
FALSE- The sale of animals suffering from contagious diseases shall be void.
40. There is no warranty against hidden defects of animals sold at fairs or at public
auctions,or of animals sold as condemned.
TRUE
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41. Acceptance of the goods by the buyer generally discharges the seller from his
liability for ay breach of warranty.
FALSE- n the absence of express or implied agreement of the parties, acceptance of
the goods by the buyer shall not discharge the seller from liability in damages
42. If the buyer is justified in refusing to accept the goods, he shall be obliged to hold
the goods as depositary.
FALSE
43. The buyer is obliged to pay interest on the price of the goods for the period
between the delivery of the goods and the payment of the price if the thing sold
produces fruits or income.
TRUE
44. The buyer may suspend the payment of the price of the thing purchased by reason
of trespass on the
thing.
FALSE- The vendee is bound to accept delivery and to pay the price of the
thing sold at the time and place stipulated in the contract.
45. A stipulation that the sale of an immovable is automatically rescind upon the
default of the buyer in the payment of the price is valid.
FALSE
46. In conventional redemption, the creditors of the vendor may make use of the right
of redemption against
the vendee although they have not exhausted the properties of the vendor.
FALSE- The creditors of the vendor cannot make use of the right of redemption
against the vendee, until after they have exhausted the property of the vendor.
47. In case of doubt, a contract purporting to be a sale with a right to repurchase shall
be construed as an equitable mortgage.
TRUE
48. For an assignment of credit to be binding against third persons, if a movable
object property is involved, the same must be in a public instrument and recorded in
the Registry of Property.
FALSE- IMMOVABLE PROPERTY
49. A debtor who has paid his creditor before he learns of the assignment of his debt
shall be released from
his liability to the assignee.
TRUE
50. The debtor’s consent is required for the validity of the assignment of the credit
made by his creditor to
another person
FALSE- the consent of the debtor is not necessary in order that the assignment may
fully produce the legal effects. What the law requires in an assignment of credit is not
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the consent of the debtor, but merely notice to him as the assignment takes effect only
from the time he has knowledge thereof.
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