L-NU AA-23-02-01-18

LYCEUM-NORTHWESTERN UNIVERSITY
Tapuac District, Dagupan City

COLLEGE OF BUSINESS EDUCATION

MIDTERM EXAMINATION – Acctg 24 Agency, Sales, Labor and Other Commercial Laws
1st Semester, AY 2019– 2020
Prepared by: Amie Jane R. Miranda, CPA

Name:_____________________________________ Score:____________________

Student No.: _______________ Year/Section:___________ Date of Exam: ____________

1. If the 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.
2. In order that the buyer may enforce the seller’s liability for breach of warranty against eviction,
the judgement depriving the buyer of the thing must first be appealed by the buyer.
3. 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.
4. As a rule, the vendor shall not be liable for a non-apparent easement that is recorded in the
Registry of Property.
5. The vendor shall be liable generally for any defect on the thing sold even if he was not aware
thereof.
6. 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 a redhibitory defect.
7. The sale of animals suffering from contagious diseases is voidable.
8. There is no warranty against hidden defects of animals sold at fairs or at public auctions, or of
animlas sold as condemned.
9. Acceptance of the goods by the buyer generally discharges the seller from his liability for any
breach of warranty.
10. If the buyer is justified in refusing to accept the goods, he shall be obliged to hold the goods as
depositary.
11. 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.
12. The buyer may suspend the payment of the price of the thing purchased by reason of trespass
on the thing.
13. A stipulation that the sale of an immovable is automatically rescinded upon the default of the
buyer in the payment of the price is valid.
14. 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.
15. In case of doubt, a contract purporting to be sale with a right or repurchase shall be contrued as
an equitable mortgage.
16. For an assignment of credit to be binding against third persons if a movable property is involved,
the same must be in public instrument and recorded in the Registry of Property.
17. 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.
18. The debtor’s consent is required for the validity of the assignment of the credit made by his
creditor to another person.
19. If real estate is sold for a lump sum, the vendor is bound to deliver all that is included within the
boudaries stated in the contract although the actual area is greater than stated in the contract.
20. When an unpaid seller exercises his right of stoppage in transitu, the contract of carriage ceases,
the carrier becoming liable as a depositary.

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II. MULTIPLE CHOICE: Select the best answer by encircling the letter of your choice.

21. When there is a stipulation exempting the vendor from the obligation to answer for eviction and
the vendee made the waiver with knowledge of the risks of eviction and assumed the
consequences, such waiver is known as:
a. Waiver intencionada
b. Waiver consciente
c. Forfeiture of rights
d. Surrender of rights
22. In case of eviction, the vendor shall be liable to the vendee only for the value of the thing sold at
the time of eviction in which of the following cases?
a. When there is waiver intencionada
b. When there is waiver consciente
c. When the vendor was in bad faith and there was no stipulation exempting the vendor from
liability in case of eviction.
d. When the vendor was inbad faith and there was stipulation exempting the vendor from
liability in case of eviction.
23. This refers to the implied warranty on the part of the seller that he has the right to sell the thing
at the time when ownership is to pass, and that the buyer from that time shall have and enjoy
legal and peaceful possession of the thing.
a. Warranty against hidden defects
b. Warranty against eviction
c. Warranty of ownership
d. Warranty of possession
24. Three of the following are the requisites in order that the vendee may enforce the vendor’s
liability in case of eviction. Which one is not?
a. There must be final judgement depriving the vendee of a part or the whole of the thing sold.
b. The vendee must have appealed from such judgement rendered against him.
c. The deprivation of the vendee is based on a right prior to the sale or an act imputable to the
vendor.
d. The vendor is notified of the suit at the instance of the vendee.
25. This refers to an encumbrance imposed upon an immovable for the benefit of another
immovable belonging to a different owner.
a. Easement or servitude
b. Real estate mortgage
c. Pledge
d. Chattel mortgage
26. Three of the following are the requisites in order that the buyer may enforce the seller’s liability
for hidden defects. Which one is not?
a. The defects of the thing sold must not be patent or visible.
b. The defects render the thing unfit for the use for which it is intended, or which diminish its
fitness for such use to such an extent that had the buyer been aware thereof, he would not
have bought it.
c. The defects must be existing at the time of sale.
d. The defects must be capable of determination by an expert.
27. The vendor shall be liable for the death of the animal sold when the following requisites are
present, except:
a. The disease existed at the time of sale
b. The disease is the cause of the death of the animal.
c. The disease must be redhibitory.
d. The animal dies within 3 days from the time of purchase.
28. The justified refusal of the buyer to accept the goods produces the following effects, except:
a. Buyer has no duty to return the goods, unless otherwise stipulated.
b. Title to the goods does not pass on to him.
c. Buyer shall not be obliged to pay the price.
d. Buyer is obliged to constitute himself as depositary until he returns the goods.
29. In three of the following cases, the buyer is not entitled to suspend the payment of the price.
Which one will give him the right to suspend payment?

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 a. Disturbance in the possession or ownership of the thing purchased.
b. The seller gives him security for the return of the price.
c. It has been stipulated that the buyer shall pay the price notwithstanding any disturbance.
d. The disturbance is a mere act of trespass.
30. A contract of sale with a right to repurchase and other contracts including a contract purporting
to be an absolute sale shall be presumed to be an equitable mortgage in the following cases,
except when the:
a. Price of sale with right to repurchase is unsually inadequate
b. Vendor remains in possession of the thing sold.
c. Period to repurchase the property is extended.
d. Vendee binds himself to pay the taxes due.
31. An owner of a rural land has the right of legal redemption of an adjoining rural land sold if the
following requisites are present, except when the:
a. Adjoining rural land is not separated by any apparent servitudes for the benefit of other
estates.
b. Land sold exceed one hectare
c. Grantee owns another rural land
d. Grantee owns an urban land.
32. This refers to the warranty of the seller that has the right to sell the thing at the time when
ownership is to pass, and which can be enforced if the buyer is deprived of the property sold by
a final judgement in court.
a. Warranty against hidden defects
b. Warranty of merchantable quality
c. Warranty against eviction
d. Warranty of possession
33. It is an affirmation of fact or any promise by the seller relating to the thing which has a natural
tendency to induce the buyer to purchase the same, relying on such promise or affirmation.
a. Condition
b. False representation
c. Warranty
d. Sales talk
34. A, B and C are co-owners of an undivided parcel of land. On May 1, A sold his share to X; on June
1, B sold his share also to X; and on July 1, C sold hi share also to X. Each sale was with a right of
repurchase.
a. X may compel A, B and C to come to an agreement to repurchase the whole land.
b. Each co-owner may exercise his right of redemption on the whole property including the
sahre of the other two co-owners.
c. Each co-owner may exercise his right of redemption only with respect to his share.
d. Any two of the three co-owners may redeem the property proportionately.
35. R, S and T are co-owners of an undivided parcel of land. R sold hi 1/3 interest to T in a deed of
absolute sale. Which is correct?
a. S may exercise the right of redemption on the interest sold by R to T.
b. S cannot exercise the right of redemption.
c. The sale made by R to T is voidable.
d. S may redeem only ½ of the interest sold by R to T.
36. This refers to the right of an adjoining owner of an urban land to be given preference to the
purchase of a small piece of urban land which is held for speculation before it is offered for sale
to others.
a. Right of subrogation
b. Right of redemption
c. Right of pre-emption
d. Right of repurchase
37. A contract of sale is perfected upon:
a. Compliance with the requirements of the law as to form.
b. Delivery of the object of the contract.
c. The meeting of the minds on the thing which is the object of the contract and upon the price
d. Demand

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 38. It is a contract of virtue of the terms of which the parties thereto promise and obligate
themselves to enter into another contract at a future time, upon the happening of certain
events, or the fulfillment of certain conditions.
a. Contract of adhesion
b. Contract of option
c. Contract of sale
d. Auto-contract
39. The contract of sale is not a:
a. Principal contract
b. Nominate contract
c. Consensual contract
d. Real contract
40. The following may not be valid objects of a contract of sale, except:
a. Objects outside the commerce of men
b. Illicit things
c. Future goods
d. Impossible service

III. ENUMERATION: Write your answer on the space provided.

Kinds of Implied Warranty

What have you learn on Law on Sales? (2 pts)

ajmiranda
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Goodluck and Godbless

Reviewed and Checked by:

Dr. Genoveva Y. Reyes, CPA, FRIAcc

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