REGULATORY FRAMEWORK FOR

BUSINESS TRANSACTIONS
Name: Date: ___________________
Course/Year/Section: Professor:________________

MULTIPLE CHOICE. Write your letter choices before the numbers.

CONCEPTUAL

1. A source of obligation not arising from law

a. Negotiorum gestio
b. Solutio indebiti
c. Culps aquiliana
d. Contract
2. Statement 1: The loss or deterioration of the thing intended as a substitute through the negligence
of the obligor does not render him liable
Statement 2: A person alternatively bound by different prestations shall completely perform one of
them
a. Both statements are true
b. Both statements are false
c. Statement 1 is true while statement 2 is false
d. Statement 2 is true while statement 1 is false
3. Culpa aquiliana as distinguished from culpa contractual
a. Proof of due diligence in the selection and supervision of employees is not available as a defense
b. Proof of the contract and of its breach is sufficient prima facie to warrant recovery
c. The negligence of the defendant is merely an incident in the performance of the obligation
d. The source of liability is the defendant’s negligent act or omission itself
4. A passenger on a truck was hurt but in a criminal case against the driver, said driver was acquitted.
The victim now sues the owner of the truck for the culpa contractual. May the suit still prosper?
a. No, this will constitute double jeopardy
b. No, the acquittal means that the guilt of the accused was not proven by the proof beyond
reasonable doubt
c. Yes, it is sufficient for him to prove the existence of the contract of the carriage and the injuries
suffered
d. Yes, provided he can prove the negligence of the driver

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5. If the obligor binds himself to perform his obligation “ as soon as he shall have obtained a loan”
from a certain bank. The obligation is:
a. With a term
b. With a suspensive condition
c. With a period
d. With a resolutory condition
6. A contract in which a person literally contracts with himself is:
a. Adhesion contract
b. Auto contract
c. Accessory contract
d. Unilateral contract
7. If the obligation of the debtor “I will pay you my debt after I have arrived from abroad”. The
obligation is:
a. Valid
b. Void
c. Voidable
d. Unenforceable
8. When a third person assumes the payment of the obligation without the knowledge of the debtor
but with the consent of the creditor
a. Delegacion
b. Expromison
c. Subrogation
d. Novation
9. The prescriptive period of an action for Quasi delict is
a. Ten (10) years
b. Six (6) years
c. Four (4) years
d. One (1) year
10. Which of the following is incorrect in an obligation in a period?
a. When the debtor binds himself to pay when his means permit him to do so, the obligation shall
be deemed to be one with period
b. Whenever in an obligation a period is designated, it is presumed to have been established for
the benefit of both the creditor and debtor
c. The court as a rule is authorize to fix the period even the period was not intended
d. The debtor loses the right to make use of the period, when debtor after the obligation has been
contracted, he becomes insolvent, unless he gives a guaranty or security for the debt
11. The obligation of the parents to provide support to their children arises from
a. Law
b. Contracts
c. Quasi-contracts
d. Quasi-delicts

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12. The following statements concerning an obligation are correct, except
a. The obligation to give is one in which the prestation consists in the delivery of a movable or an
immovable thing
b. The obligation not to give is a positive obligation
c. The obligation to do includes all kinds of work or services
d. The obligation not to do consists in abstaining from some act
13. The following are the requisites of a prestation or object of an obligation, except
a. It must be possible, physically and juridically
b. It must be determinate, or, at least, determinable according to pre-established elements or
criteria
c. It must have possible equivalent in money
d. It must be a positive obligation only
14. The following are examples of vinculum, except
a. Relation established by law
b. Relation established by contract
c. Relation established by natural obligation
d. Relation established by quasi-contract or quasi-delict
15. Which of the following statements concerning obligations arising from law is incorrect?
a. Only obligations expressly determined in the Civil Code or in special law are demandable
b. The law cannot exist as a source of obligations, unless the acts to which its principles may be
applied exist.
c. The obligations and correlative rights arising from law shall be governed by the law by which
they are created
d. The obligation derived from law are presumed
16. Which of the following is a positive and real obligation?
a. Obligation to teach
b. Obligation not to smoke in public place
c. Obligation to deliver the goods
d. None of the choices
17. A bought a parcel of land from B on installment. When the first installment fell due, A did not pay.
His defense was that he did not have available money and he therefore pleaded impossibility of
performance.
a. A obligation is extinguished because A has no available money
b. A obligation is extinguished because of impossibility of performance
c. A is liable. A mere pecuniary inability to fulfil an engagement does not discharge the obligation
of the contract
d. A is liable because the obligation is to pay a specific money

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18. On April 20, 2020, A obliged himself to give B P 500,000 if B will marry C on or before December 10,
2020. Which of the following is statement is not correct?
a. The obligation of A is demandable if B marries C on or before December 10, 2020
b. The obligation of A is extinguished if it is already January 1, 2021 and B has not yet married C
c. The obligation is demandable if B marries C on December 15, 2020
d. The obligation of A is extinguished on December 1, 2020 if C dies on the said date and B has not
yet married C
19. Compensation is not proper when the debts arises in the following case, except
a. Depositum
b. Obligation of a depositary
c. Contract of Mutuum
d. None of the choices
20. The following are all factors vitiating consent, except
a. Mistake
b. Dolo incidente
c. Intimidation
d. Violence
21. The following are the requisites of fortuitous event, except
a. Cause is independent of the will of the debtor
b. The event is unforeseeable/unavoidable
c. Occurrence renders it absolutely impossible for the debtor to fulfil his obligation in a normal
manner; impossibility must be absolute not partial, otherwise not force majure.
d. Debtor contributed to the aggravation of the injury to the creditor
22. April promised to give Boy her only Honda Civic Car 2016 model if Boy passes the CPA Board Exam.
Pending the results of the exam, the car is destroyed by a fortuitous event without any fault on the
part of April. As a result
a. April will have to give Boy another Honda Civic car 2016 model or its equivalent
b. The obligation of April is extinguished
c. The obligation of April is converted into monetary obligation
d. The obligation of April will be equitably reduced
23. Which of the following is a primary classification of obligations under the New Civil Code?
a. Civil and natural obligations
b. Divisible and indivisible
c. Real and personal obligations
d. Unilateral and bilateral obligations
24. Statement 1: Stranger a general rule cannot demand the enforcement of a contract
Statement 2: Stipulation pour autrui is an exception to the principle of “mutuality of contract”
a. Both statements are true
b. Both statements are false
c. Statement 1 is true while statement 2 is false
d. Statement 2 is true while statement 1 is false

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25. Atty. Nega renders legal service to Tiv his close friend. The former can still charge reasonable
attorney’s fees even in the absent of any written agreement between them. This is an example of
a. Do ut des
b. Do ut facias
c. Facio ut des
d. Facio ut facias
26. The stages of contract according to the order of their occurrence are:
a. Perfection, negotiation and termination
b. conception, consummation and birth
c. conception, perfection and termination
d. termination, negotiation and birth
27. Which of the following is not subject to ratification?
a. Rescissible contract
b. Voidable contract
c. Unenforceble contract
d. Void contract
28. Statement 1: Mistake as to the meaning of a difficult provision of law may vitiate consent
Statement 2: A deaf-mute who knows how to write may validly give consent to a contract
a. Both statements are true
b. Both statements are false
c. Statement 1 is true while statement 2 is false
d. Statement 2 is true while statement 1 is false
29. The following are the requisites of an obligation, except
a. Demand
b. Passive and active subject
c. Efficient cause
d. Prestation
30. Which of the following is a civil obligation?
a. X obliges himself to pay Y P10,000 on October 30, 2020
b. The obligation of a husband and wife to observe fidelity
c. The obligation of a catholic to hear mass every Sunday
d. None of the choices

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