LANZUELA, HANZEL

LEE,MEI YIN

LOPEZ, BENHUR

MACARIMBANG, HANAN

CPAR - FINALS

Negotiable Instrument

1. B received an instrument from A on March 31, 2000. How much can B collect on April 30, 2000. “Pay to order
amount only five thousand pesos (P5,000) with 12% interest.”
A. P5,000 plus 30 – day interest
B. B cannot collect because the instrument is defective
C. P5,000 only
D. P5,000 plus interest

2. 1st Statement: An order or promise to pay is unconditional though coupled with an indication of particular fund
out of which reimbursement is to be made, or particular account to be debited with the amount.
2nd Statement: An order or promise to pay out a particular fund is not unconditional.
A. B. C. D.
1st Statement True False True False
2nd Statement True False False True

3. B bought a used cellphone from S. S preferred cash but B is a friend so S accepted B’s promissory note for
P10,000.00. S thought of converting the note into cash by indorsing it to his brother X. The promissory note is a
piece of paper with the following hand-printed notation: “B WILL PAY S OR HOLDER TEN THOUSAND PESOS
IN PAYMENT FOR HIS CELLPHONE 1 WEEK FROM TODAY”. Below this notation is B’s signature with
“8/1/00” next to it, indicating the date of the promissory note. When S presented B’s note to X, the latter said it
was not a negotiable instrument under the law and so could not be a valid substitute for cash. Which of the
following statements is correct?
A. The instrument is non-negotiable because it is not sign by the maker.
B. The instrument is non-negotiable because the cause or consideration paid is not stated in the instrument.
C. The instrument is negotiable because the requisites of negotiability are present.
D. The instrument is non-negotiable because it is not payable to order or bearer

4. Item No1: "To X: Pay to P on demand the amount of P5.000.00 and reimburse yourself from the proceeds of the
sale of my car which is still in your possession. "Sgd.: Drawer"
Item No. 2: "I promise to pay X the amount of P5.000.00 on demand." Sgd.: M.

A. B. C. D.

Item No. 1 Negotiable Non-negotiable Non-negotiable Negotiable

 Item No. 2 Negotiable Non-negotiable Negotiable Non-negotiable

5. Which of the following examples is not negotiable?

A. “To X: PLEASE pay to the order of Y P5,000.00 on demand. “Sgd.: D
B. “To X: Pay to the order of yourself the amount of P50,000 in two EQUAL MONTHLY INSTALLMENTS
beginning May 31, 2002. “ Sgd.: D
C. Pay to P or bearer the amount of P50,000 on June 25, 2002 or deliver to him ten (10) pigs AT HIS
ELECTION.” Sgd.: D
D. “I promise to pay X or order P5,000 AS SOON AS I HAVE MONEY.” Sgd.: M
6. “I promise to pay to the order of Pedro San Pedro only the sum of $10,000.” (Sgd.) M. The words “Pedro San
Pedro only” are written in the handwriting of M. The instrument is
A. Negotiable, convert dollars into legal tender
B. Non-negotiable, because the instrument is payable in dollars
C. Non-negotiable, indorsement is restrictive
D. Non-negotiable, payable only to a specified person.

7. 1st Statement: “I promise to pay B the sum of P20,000, three (3) days from date,” Sgd. A (The instrument is not
dated)
2nd Statement: “I promise to pay to the order of B or C the sum of P50,000. Sgd. A.
A. Both are negotiable
B. Both are not-negotiable
C. First is not negotiable while second is negotiable
D. First is negotiable while second is not

8. M, maker, P payee. Instrument is indorsed to “pay A, if he passes the CPA exams”. Which of the following is
incorrect?
A. The conditional indorsement will not affect the negotiability of the instrument
B. Before the release of the result of the exams M may pay the holder
C. Before the result of the exams, M may refuse to pay the holder because the condition is not yet fulfilled
D. None of the above

9. Identify the following indorsement

“Pay to A, without recourse” Sgd. P
A. Qualified C. Special Qualified indorsement
B. Blank D. Qualified restrictive

10. Identify the following indorsement.

“Pay to A if he completes work today, without recourse,” Signed P.
A. Qualified indorsement
B. Special and qualified indorsement
 C. Restrictive and qualified
D. Special, conditional and qualified endorsement

11. 1st Statement: Where a negotiable instrument is indorsed conditionally, the person liable on the instrument may
disregard the condition and legally pay the same.
2nd Statement: An instrument which is negotiable in origin continues to be negotiable unless restrictively indorsed
or discharged by payment.
A. B. C. D.
1st Statement True False True False
2nd Statement True False False True

12. This instrument was written on the negotiable instrument itself: “Pay to Juan San Juan, or order, provided he
passes the CPA examination 2003. Sgd. Pedro San Pedro.” This kind of indorsement is called
A. Conditional indorsement C. Special indorsement
B. Restrictively indorsement D. Combination of A and C
13. One of the following indorsement is a valid negotiation
A. Pay to A P6,000 (amount of the instrument is P10,000)
B. Pay to A P7,000 and to B, the balance (amount of the note is P10,000)
C. Pay to A P8,000 out of the amount of P10,000 of this note
D. Pay to A and B P10,000
14. C issues a bill payable to the order of R. Later R without endorsing the bill transfer for a consideration said bill to
M. The following, except one, are the valid effects of the transfer
A. M becomes a holder
B. M acquires the right to have the endorsement of R
C. The transfer vests in M such title as R had thereon
D. The bill is merely assigned and not negotiated.
15. Negotiable instruments; effects of indorsement
1. Pay to A P6,000 and B P4,000
2. Pay to A and B P10,000
A. Both indorsement are valid C. Both are invalid
B. No. 1 is valid; No. 2 is invalid D. No. 1 is invalid; No. 2 is valid

16. M makes a negotiable note in favor of P payable on December 25, 1997, with the following successive
indorsements. P to A, A to B, B to C, C to D. On the due date M is paying D, but D extends the payment up to
December 25, 1998. Which of the following is incorrect.
A. If M become insolvent on December 25, 1998, P, A, B, C are discharged of their obligation
 B. “If the indorsers consented to the extension of time, and M become insolvent the indorsers are still liable
C. If before the extension date, D cancels the signature of P as indorser, P, A, B, C and the instrument are
discharged
D. None of the above

17. C issues a bill payable to the order of R. Later R without endorsing the bill transferred for a consideration said
bill to M. The following except one is the valid effects of the transfer
A. M becomes a holder
B. M acquires the right to have the endorsement of R
C. The transfer vest in M such title as R had thereon
D. The bill is merely assigned and not negotiated

18. One of the following indorsements is a valid negotiation

A. Pay to A P6.000 (amount of the instrument is P10,000)
B. Pay to A P7.000 and to B, the balance (amount of the note is P10,000)
C. Pay to A P8.000 out of the amount of P10,000 of this note
D. Pay to A and B P10,000

19. Under the Negotiable Instrument Law, which of the following statements best describes the effect of a person
endorsing a check "without recourse"?
A. The person has no liability to prior endorsers
B. The person makes no promise or guarantee of payment on dishonor
C. The person gives no warranty protection to later transferees
D. The person converts the check into order paper.

20. Three of the following are requisites before a person is considered irregular or anomalous indorser. Which of the
following is the exception?
A. Not a party to the instrument C. Signed the instrument in blank
B. Person principally liable D. Signed the instrument before delivery

Sales

1. Dacion en pago as distinguished from a contract of sale

a. There is greater freedom in fixing the price
b. Obligations are created
 c. Ownership of the object is transferred to the other party
d. A pre-existing credit is extinguished
2. As a rule, this contract of sale involving a piece of land is void,
a. Between a minor and a deaf mute who does know how to write
b. Between two insane persons who did not act during lucid interval
c. Between first degree cousins
d. Between husband and wife
3. One of the following is not correct
a. Things subject to resolutory condition may be the object of contract of sale
b. A thing is generic when it is particularly designated or physically segregated from all others
of the same class
c. Things having potential existence may be the object of the contract of sale
d. The sole owner of a thing may sell undivided interest therein

4. A needs a size 10 of model 101 of Delicious Shoes regularly available to the public for her
boyfriend B, but the same is out of stock so she placed an order for one. On the other hand, B
placed an order for size No. 8, colored violet, (something not ordinarily made by the company) to be
given to A. Which is correct?

a. Both are contracts of sale

b. Both are contracts for a piece of work
c. First is contract of sale, second is a contract for a piece of work
d. First is a contract for a piece of work, second is a contract of sale

5. A offered to sell for P12,000,000 her house and lot to B who was interested in buying the same. In
her letter to B, A stated that she is giving B a period of one month within which to raise the amount
and that as soon as B is ready, they will sign the deed of sale. Five days before the expiration of the
one month period. A went to B told her that she is no longer willing to sell the property unless the
price is increased to P15,000,000. Which is correct?

a. B may compel A to accept the P12,000,000 first offered

b. A may compel to B to pay P15,000,000
c. A and B should shoulder the P3,000,000 difference
d. B cannot compel A to accept the P12,000,000 first offered

6. A, 17 years old, sold to B, of legal age, her necklace worth P20,000 for P15,000. Later, B sold the
necklace to C for P20,000. Which of the following statements is correct?

a. A has got a voidable title because at the time of sale, she is a minor.

b. A can ask for rescission of the sale to C because she suffered a lesion of more than ¼ of the
value of property.

c. If C is in bad faith, C becomes the owner of the necklace upon delivery to him but his title is
voidable.
 d. A can ask for the annulment of the sale to C because at the time sale she is a minor.

7. Goods are deemed in transit

a. When the buyer accepts delivery of the goods upon arrival at destination.
b. When the buyer intercepts and lawfully takes possession of the goods at any point before
the destination
c. From the time they are delivered by the seller to a common carrier or other bailee from
transmission to the buyer, up to the time that the buyer or his agent takes delivery of the
goods from the carrier or bailee
d. When the carrier or bailee, upon arrival of the goods at destination acknowledges to the
buyer or his agent that he is holding the goods as bailee for the latter.

8. Goods are deemed no longer in transit

a. If the goods are rejected by the buyer for a valid reason and the carrier or other bailee
continues in possession of them, even if the seller has refused to receive them back
b. From the time they are delivered to a carrier by land, water or air for the purpose of
transmission to the buyer
c. From the time they are delivered to a bailee for the purpose of transmission to the buyer until
the buyer or his agent in that behalf, tales delivery of them such bailee.
d. If the carrier or other bailee wrongfully refuses to deliver the goods to the buyer or his agent
in that behalf.

9. A sold to B orally a parcel of land for P200,000. A effected the delivery of the land. The payment
of the price was to be made three months later. At the end of the three month period

a. B may refuse to pay claiming in his defense the Statute of Frauds

b. B may return the parcel of land to A

c. A can collect from B because the contract has already been executed

d. B may refuse to pay on the ground that there is no written contract to support the sale.

10. On January 10, 2015, A sold for P2M her house and lot to B. It was agreed that the delivery of
the house and lot, and the payment therefore, would be made on March 1, 2015. Unfortunately, C a
stranger negligently set the house on fire on February 25, 2015, and the house was completely
destroyed. Which is correct?

a. B is not required to pay the P2M since the contract had no subject matter

b. A must still deliver the lot but is excused from delivering the house, while B must still pay the
P2M

c. A must still deliver the lot while B should pay only the amount equivalent to the value of the
lot

d. A need not deliver the lot while B need not pay the P2M
11. If movable property should have been sold to different vendees, the ownership shall be
transferred to the person

a. Who have first taken possession in good faith

b. Who presents the oldest title in good faith

c. Who in good faith first recorded it in the Registry of Property

d. Who have paid in good faith the purchase price in full.

12. Action by the vendee against the vendor to nullify the sale due to some vices or defects which
render the object of sale unfit for the use intended or knowledge of which, the vendee would not

have bought the thing

a. Accion quanti minoris b. Accion reinvidicatoria c. Accion pauliana d. Redhibitory action

13. Action to seek a corresponding reduction in price by reason of some vices or defects in the thing
purchased

a. Accion quanti minoris b. Accion reinvidicatoria c. Accion pauliana d. Redhibitory action

14. The redhibitory action based on the faults or defects of animals must be brought within

a. 30 days from delivery to the vendee c. 45 days from delivery to the vendee

b. 40 days from delivery to the vendee d. 6 months from delivery to the vendee

15. This serves as a proof of the perfection of the contract of sale

a. Dacion en pago b. Option money c. Delivery d. Arras

16. A contract of sale is not a(an)

a. Onerous contract b. Accessory contract c. Commutative contract d. Bilateral

17. Emption spei as distinguished from emptio rei speratae

a. Sale of a future thing c. Its quantity and quality

b. Should come into existence d. Sale of a present thing

18. The sale of an expected thing

a. Dacion en pago b. Payment by cession c. Emptio spei d. Emptio rei-speratae

19. The sale of the hope itself

a. Dacion en pago b. Payment by cession c. Emptio spei d. Emptio rei-speratae

20. In contract of sale, if the price is absolutely simulated, the sale is

a. Unenforceable b. Voidable c. Void d. Rescissible

Agency
1. Which of the following is correct?
a. A contract of agency must be in writing to be a valid agreement.
b. A sale of personal property made by an agent without authority from the owner is void.
c. A sale of a piece of land made by an agent with oral authority from the owner is void.
d. An emancipated minor cannot be appointed as agent.

2. In which of the following acts may a person not appoint an agent?

a. To represent the principal in a wedding ceremony where the principal sponsor.
b. To vote for the principal during the meetings of stockholders where the principal is a
stockholder.
c. To represent the principal in a baptismal ceremony where the principal is the father of
the child to be baptized.
d. To attend a meeting of the board of directors of a corporation where the principal is a
director
3. Not a fundamental obligation of the agent
a. Sacrifice his interest and give it to the principal if there is a conflict
b. To render an accounting of the transaction
c. Should not carry out the agency even if that is the instruction, if he knew it would result
in a loss or damage to the principal
d. Can be the borrower if he is authorized to lend
4. A appointed B as his agent to sell his car for 250,000. B sold the car to C for 250,000 but B acted
in his own name. After delivery, C inspected the car and she found hidden defects in the car. Is
A, as principal, liable to C even if B acted in his own name?
a. No, applying “ caveat emptor” or let the buyer beware
b. Yes, because this is a contract involving property belonging to the principal
c. No, because the contract of sale is between B and C
d. Yes, if C was aware of the hidden defects
5. To improve the financial condition of his principal, an agent with general powers of
administration given to him by the principal in writing, sold two parcels of land, one for less than
the price appearing in the inventory prepared by the principal and the other for double the price
that appeared in the aforesaid inventory. Which is correct?
a. Both contracts cannot be enforced against the principal
b. Both contracts are binding upon the principal
c. The sale for double the price appearing in the inventory is binding upon the principal
d. The sale for less than the price appearing in the inventory is binding upon the principal
6. It is a contract wherein a person binds himself to render some service in representation or on
behalf of another, with the consent or authority of the later
a. Agency
b. Contract of service
c. Contract of piece work
d. Partnership
7. Which of the following refers to a contract of agency?
a. He represent an incapacitated person
b. There is no meeting of minds
c. He is controlled by the principal
d. The legal relation is always created by law
8. The following refers to a contract of agency?
a. Consensual
b. Principal
c. Innominate
d. Bilateral
9. If an agent enters into a contract in the name of his principal, exceeding the scope of his
authority, the contract is
a. Voidable
b. Unenforceable
c. Rescissible
d. Void
10. This requires a special power of attorney, except
a. To accept or repudiate an inheritance
b. To effect novation
c. To enter into compromise
d. To lease real property for one year
11. P appointed A to be his agent to administer his mango orchard while P is in USA, but A died
leaving his son, B, of legal age to take care of the mango orchard until P arrived. This is an
agency created by:
a. Estoppel
b. Ratification
c. Assignment
d. Operation of law

12. A, a manufacturer and B, a distributor agreed to a contract where A will 2,000 units of A’s
products to B every month and B will sell the products at A’s suggested prices 15%. All unsold units
at the end of the year shall be bought back by A at the same price at the time the products were
ordered. A shall hold B free from any claim for defects in the units. The contract between A and B is

a. Contract of sale

b. Sale with right to repurchase

c. Contract of lease

d. Agency to sell

13. Bears the risk of collecting from the buyer the price of the sale

a. Commission agent

b. Delegacion

c. Del credere agent

d. Expromission

14. On day 1, A appointed B as his agent covered by a general power to lease his car to Z for eight
months. On day 2, A appointed C as his agent covered by a special power to lease the same car for
two months. On day 3, A directly transacted business with Z, leasing the car for two months. Which
is correct?

a. The appointment of B is valid because it is covered by a general power

b. The appointment of C is valid because it is covered by special power

c. The appointment of B and C are considered revoked because the principal directly transacted with
Z

d. The appointment of B is valid because it is the earliest appointment

15. Not a mode of extinguishing an agency

a. Accomplishment of agency

b. Death of the principal, and the agency is for the interest of either the principal or agent

c. Insanity of the principal or agent

d. Dissolution of the firm or corporation which entrusted or accepted the agency.

16. Agency can be revoked at will

a. When a bilateral contract depends upon it

b. If it is the means of fulfilling an obligation already contracted

c. If a partner is appointed managing partner in the articles of partnership and his removal is
unjustifiable

d. When the principal directly manages the business entrusted to the agent

17. In agency, the agent represents

a. A person who is capacitated

b. A person who is incapacitated

c. Heirs and creditors of the estate

d. The judicial court

18. S1. When a sale of a piece of land or any interest therein is through an agent, the authority of
the latter shall be in a public instrument, otherwise the sale shall be void.

S2. Agency is presumed to be without compensation unless there is proof to the contrary.

a. Both are true

b. Both are false
c. Only the First Statement is true
d. Only the Second Statement is true.
 19. A special power to sell includes the power of mortgage and special power to mortgage includes
the power to sell. Should there be a stipulation that agent shall advance the necessary funds, he shall be
bound to do so even when the principal is insolvent.
a. Both are true
b. Both are false
c. Only the first statement is true
d. Only the second statement is true

20. S1. If the agent has been empowered to borrow money he may himself be the lender at the current
rate of interest and if he has been authorized to lend money at interest, he can borrow it.

S2. Every agent is bound to render an account of his transactions and to deliver to the principal
whatever he may received by virtue of the agency even though it may not be owing to the principal.

a. Both are true

b. Both are false
c. Only the First Statement is true
d. Only the Second Statement is true.

PLEDGE, MORTGAGE AND ANTICHRESIS

1. S, a minor, sold her bracelet to B for P8,000. Later, B, needing money to pay her daughter’s
tuition fee, borrowed P15,000 from C and as a security, pledged the bracelet to the latter. B
failed to pay C resulting into the auction sale of the bracelet in favor of D for P10,000 only.
Which of the following statement is correct?
a. The title of B over the bracelet is not valid, hence the pledge, as well as the sale of said
bracelet is likewise defective. The pledger must be the owner of the thing pledged.
b. The deficiency of P5,000 may still be recovered by C from B if there is a stipulation to
this effect.
c. C can no longer recover the deficiency of P5,000 from B. the pledge, together with the
sale is valid. The voidable title of B is valid because it is not yet annulled.
d. If D was a purchaser in bad faith as he knew of the defective title of B over the bracelet
from S, ownership will not pass to D.
2. S sold to B a specific car for P200,000 payable in four equal installments. S delivered the car to B
but required B to mortgage it back to S to answer for the unpaid installments. B paid the 1 st and
2nd installments but he failed to pay the balance. S foreclosed the mortgaged property and sold
it at public auction for P80,000. As a result,
a. S can recover from B the balance of P20,000
b. S can recover from B the balance of P20,000 if there is stipulation to that effect.
c. S cannot recover the deficiency any more even if there is stipulation to that effect.
d. S cannot recover the deficiency except if there is stipulation.
3. A borrowed P100,000 from B with A’s ring given to B by way of pledge. It was stipulated that in
case of non-payment on due date, the ring would belong to B. the forfeiture is
a. Caveat emptor
b. Dacion en pago
 c. Pactum commisorium
d. Pacto de retro
4. A borrowed P100,000 from B, and as a security. A pledged his ring to B. after the obligation falls
due, A goes to B relinquishing ownership of the ring in favor of B. this is
a. Caveat emptor
b. Dacion en pago
c. Pacto de retro Pactum commisorium
5. D deposits his money by way of a savings account with C bank. The contract between D and C is
a. Deposit
b. Agency
c. Commodatum
d. Mutuum
6. This is a stipulation in pledge or mortgage providing that the ownership of the thing given as
security will pass to the pledgee or mortgagee upon default of the debtor.
a. Constitutum possessorium
b. Pactum commisorium
c. Legal subrogation
d. Redemption
7. The followingmay be the object of pledge except
a. All movables within the commerce of men which are susceptible of possession
b. Bills of lading
c. Shares of stock
d. Parcels of land
8. A kind of mortgage which lacks the formalities requires by law but nevertheless shows the
intention of the parties to secure a debt with real property is known as
a. Conventional mortgage
b. Voluntary mortgage
c. Equitable mortgage
d. Legal mortgage
9. This refers to the right of a person to retain a thing until he receives payment of his claim in the
cases provided by law such as one has executed work on a movable.
a. Conventional mortgage
b. Voluntary mortgage
c. Legal mortgage
d. Chattel Mortgage
10. It is the right of the mortgagor to redeem the property that was mortgaged after it was sold.
a. Equity of redemption
b. Right of redemption
c. Right of subrogation
d. Right of pre-emption
11. As a general rule, any deficiency in the foreclosure sale may be recovered in the following
contarcts, except in
 a. Chattel Mortgage
b. Real mortgage
c. Conventional pledge
d. Antichresis
12. As a general rule, in case of excess of the proceeds of the foreclosure sale over the creditor’s
claim, the excess shall belong to the creditor in
a. Chattel Mortgage
b. Real mortgage
c. Conventional pledge
d. Antichresis
13. Recording in the Registry of property in the appropriate book is required for the validity of the
contarct of
a. Chattel Mortgage
b. Real mortgage
c. Conventional pledge
d. Antichresis
14. The delivery required in pledge for its perfection and validity is
a. Actual delivery
b. Execution of public instrument
c. Execution of private instrument
d. Transfer of title of ownership
15. A contract of antichresis to be valid:
a. Must be in writing
b. Must be in a public instrument
c. Must be recorded in the Registry of Property
d. May be in any form
16. The creditor may automatically appropriate for himself the thing on which the security was
constituted upon the default of the debtor in;
a. Pledge
b. Mortgage
c. Antichresis
d. Automatic appropriation is not allowed in any case.
17. one of the following is not a characteristic of real mortgage
a. Accessory contract
b. Real contract
c. Inseparable contract
d. Indivisible contract
18. The price stipulated by the parties to a mortgage contact below which the property shall not be
sold at public auction
a. Market price
b. Current price
c. Tipo or upset price
 d. Selling price
19. It refers to the procedure adopted by the mortgagee to terminate the rights of the mortgagor
on the property mortgaged and includes the sale of the property
a. Redemption
b. Repossession
c. Foreclosure
d. Repurchase
20. The following are common to pledge, chattel mortgage and real mortgage, except:
a. These contracts are constituted to secure the performance of a principal obligation
b. These contracts must be in writing and registered in order to be binding against third
persons
c. The pledgor/mortgagor must be the absolute owner of the thing pledged or mortgaged
d. There can be no valid pledge, chattel, or real mortgage without a valid obligation
21. I. the sale of the thing pledged shall extinguish the principal obligation provided the proceeds of
the sale are equal to the amount of the principal obligation.
II. If the price of the sale is more than the amount of the obligation, the debtor shall be entitled
to the excess, unless it is otherwise agreed.
a. Both are true
b. Both are false
c. Only the first is true
d. Only the second is true
22. I. If the price of the sale is less than the amount of the obligation the creditor shall not be
entitled to recover the deficiency except if there is a stipulation to the contrary.
II. If two or more things are pledged, the pledger may choose which he will cause to be sold,
unless there is a stipulation to the contrary.
a. Both are true
b. Both are false
c. Only the first is true
d. Only the second is true
23. I. A pledge shall not take effect against third person if a description of the thing pledged and the
date of the pledge do not appear in a public instrument.
II. If after the auction sale, the thing pledged is not sold, the pledgee can appropriate the thing
pledged.
a. Both are true
b. Both are false
c. Only the first is true
d. Only the second is true
24. I. A pledged his ring to B for P20,000. A failed to pay his obligation on time. B sold the ring at a
public auction for P16,000. B cannot recover P4,000 from A even if there is stipulation.
II.If the proceeds of sale is P24,000. A can recover the excess of P4,000 if stipulated.
a. Both are true
b. Both are false
 c. Only the first is true
d. Only the second is true
25. I. In sale at public auction, the pledger or owner may be a bidder and shall have a better right if
he should offer the same terms as the highest bidder.
II. Pledge is a real contract.
a. Both are true
b. Both are false
c. Only the first is true
d. Only the second is true
26. I. A stipulation prohibiting the owner from alienating the immovable mortgaged shall be void.
II. The equity of redemption refers to the right of the mortgagor to redeem the mortgaged
property within a certain period of time after it was sold to a third person.
a. Both are true
b. Both are false
c. Only the first is true
d. Only the second is true
27. Movable property is delivered by the debtor to the creditor or a third person by common
agreement to secure a principal obligation.
a. Pledge
b. Real Estate Mortgage
c. Chattel Mortgage
d. Pactum Commisorium
28. A mortgage constituted upon an immovable to secure an obligation.
a. Pledge
b. Real Estate Mortgage
c. Chattel Mortgage
d. Pactum Commisorium
29. A mortgage constituted upon an movable to secure an obligation.
a. Pledge
b. Real Estate Mortgage
c. Chattel Mortgage
d. Pactum Commisorium
30. A pledge operated by operation of law.
a. Legal pledge
b. Conventional pledge
c. Equity of redemption
d. Right of redemption
31. A pledge created by agreement of the parties
a. Legal pledge
b. Conventional pledge
c. Equity of redemption
d. Right of redemption
32. The right of the mortgagor to redeem the mortgaged property after his default in the
performance of his obligation but before the property is sold.
a. Legal pledge
b. Conventional pledge
c. Equity of redemption
d. Right of redemption
33. The right of the mortgagor to repurchase within a certain period the property that was
mortgaged after it was sold for the payment of the mortgage debt.
a. Legal pledge
b. Conventional pledge
c. Equity of redemption
d. Right of redemption
34. The party who delivers a movable property to another to secure his debt or that of another
person.
a. Pledgor
b. Mortgagor
c. Pledgee
d. Mortgagee
35. The party who constitutes a security upon a movable or immovable property but without
delivering the property.
a. Pledgor
b. Mortgagor
c. Pledgee
d. Mortgagee
36. The price stipulated by the parties in a mortgage below which the property shall not be sold in
the event of foreclosure.
a. Upset Price
b. Free disposal
c. Pledgee
d. Mortgagee
37. The property being given in pledge or mortgage must not be subject to any claims or
encumbrances.
a. Upset Price
b. Free disposal
c. Pledgee
d. Mortgagee
38. The party who receives a movable property from another to secure the latter’s debt or that of
another.
a. Upset Price
b. Free disposal
c. Pledgee
d. Mortgagee
39. The party in whose favor a security is constituted upon a movable or immovable property but
without the delivery of the property to him.
a. Upset Price
b. Free disposal
c. Pledgee
d. Mortgagee
40. A contract whereby the fruits of an immovable belonging to the debtor or third person are to be
applied to the interest of, and thereafter to, the principal obligation.
a. Antichresis
b. Pledge
c. Mortgage
d. Sale