sales mcq

1. The essence of a contract of sale is a. ownership b. possession c. warranty d. delivery of object

2. If there is a meeting of the minds, there is a perfected contract of sale. a. Yes, because all consensual contracts are perfected by mere consent b. No, because delivery of the thing is essential for the perfection of the contract of sale c. Yes, because the obligation of the seller to sell and buyer to buy arise as soon as there is meeting of the minds. d. No, because meeting of the minds is not the only requisite of the perfection of a contract of sale 3. a buyer may compel the seller to make the delivery if a. when what is to be delivered is an indeterminate thing b. when what is to be delivered is a generic thing c. when what is to be delivered is a determinate thing d. when what is to be delivered is a specific thing 4. in a contract of sale of personal property, if the price is payable in installments, the vendor may exercise the following remedies a. if the vendee fails to pay the full amount, vendor can demand exact fulfillment of the obligation b. if the vendee fails to pay an installment, vendor can cancel the sale c. if the vendee fails to pay 2 or more installments, he may demand rescission and keep amounts paid so far d. both a and b 5. Can a person without capacity to act can enter into a contract of sale? a. No, because for a contract of sale to be valid, both parties should have the capacity to act. b. Yes, because anyone is free to buy anything especially in department stores c. No, because it would constitute lack of consent making the contract voidable d.Yes, d.Yes, because there are some things that are indispensable for the buyer's clothing or dwelling 6. in a contract of sale between husband and wife, who can contest its validity? a. either the husband or the wife b. persons claiming to be illegitimate children of either the husband or wife (reason: HEIRS of husband/wife) c. the siblings of either husband or wife d. the state when there are creditors of either husband or wife 7. the following persons cannot acquire by purchase, even at a public or judicial

auction, either in person or through the mediation of another except a. the guardian in connection with the property of the person under their guardianship. b. the lawyer in connection with the property of his client not in litigation c. a public officer in connection with the property of the state under his administration d. agents in connection with the property interested to him for sale 8. all things which are not outside the commerce of men may be the object of a contract of sale except for a. future things b. future inheritance c. rights which are not intransmissible d. an undivided interest 9. when payment is made in a contract of sale a. the contract of sale is consummated already b. title passes over to the vendor c. possession (either actual or constructive) is deemed of the vendee's d. the contract of sale is perfected already 10. Can a person who is not an owner of a thing alienate and deliver it? a. No, when he doesn't have the authority to do so. b. Yes, when he eventually acquires title of the thing c. No, when the thing is acquired in bad faith by the vendor d. Yes, when he is eventually in possession of the thing 11. A sold books to B as evidenced by invoice receipts who in turn sold the books to C. However, B turned out to be an impostor and never paid A. Who is the rightful owner of the books? a. A because title never passed to B thus C also didn't acquire the title b. B because title already passed to him which he couldn't pass to C for B's nonpayment to A. c. C because title already passed to him by operation of law. EDCA publishing v. Santos (B had a voidable title. actual delivery to impostor because there was no unlawful deprivation. the books were disposed of with the owner's consent even though there was fraud) d. C because possession was with him already. 12. A sold B a car with the understanding that B would pay after the car is registered in his name. After the registration and the deed of sale were delivered to B, B disappeared with the car which was used by A to deliver the documents. B in turn sold the car to C who bought it in good faith. Who had better right of the car? a. A because the title never passed to B C also didn't acquire the title. (Aznar v. Yapdiangco: B had no title of car. there was no delivery of car thus title is non-existing thus void. There was no transfer of ownership as A was dispossessed of the car without his consent.)

b. B because title already passed to him which he couldn't pass to C for B's nonpayment to A. c. C because title already passed to him by operation of law. d. C because possession was with him already. 13. When can the courts fix the price in a contract of sale? a. When parties are both unable or unwilling to fix the price b. When third persons acted in bad faith or by mistake. (1469) c. When one of the parties acted in bad faith or by mistake. d. When third persons are prevented from fixing the price by fault of the seller or the buyer. 14. A sold his land originally valued at P10,000 to B for P1 and some unspecified services stated in the contract as consideration. Is the sale valid? a. Yes, because aside from the one-peso consideration, there were other services to be rendered. b. No, because there is no real price and no valid consideration. (Bagnas v CA. no specified services. 1 peso here is a notoriously low indicator of actual value) c. Yes, because the price is real and agreed upon by both parties thus there was no fraud involved. d. No, because there was false consideration. 15. The fixing of the price can be left to the discretion of one of the contracting parties if a. it's the seller who fixed the price because he's the owner after all b. it's the buyer who fixed the price but the seller later consented to the price. c. it's the seller who fixed the price but the buyer later consented to the price. d. it's the either the seller or buyer who fixed the price and the other consented to it. (1473) 16. A sold B his van. After agreeing on the price, both A and B failed to agree on how the payment should be made. But, B made a downpayment nevertheless which A accepted. When B demanded the delivery of the van, A refused claiming that there was no perfected contract of sale . B insisted that he made a downpayment already. Was there a perfected contract of sale? a. Yes, because there was a downpayment made already thus the obligation to consummate the contract arose already. b. No, because there was no perfected contract of sale as both parties failed to agree on how the payment should be made. (Velasco v CA. Manner of payment must be agreed upon.) c. Yes, because the downpayment was accepted by A already. d. No, because there was no perfected contract of sale as there was no consent by A. 17. A told B he wanted to buy his land thus A paid a reservation money which B

accepted evidenced by the receipt with the indication that A would buy it within the year. When the period expired B sold the land to C. A demanded that B should deliver the land to him already and tried paying the amount which B refused. Was B obligated to sell the land to A after the expiration of the period? a. Yes, because money had already been paid which was accepted by B even though the period to buy it expired already b. No, because what A had was only a privilege to buy which period already expired. (Limson v. CA. this is only an option money and not an earnest money. there was nothing in the receipt that would indicate that the amount was part of purchase price. period expired already) c. Yes, because there was money paid already which was accept by B and there was the eventual payment of the full price which B refused. d. No, because A as the owner had the right to sell the property before the payment of the land. 18. A told B he wanted to sell his land to him. B said he would buy the land as soon as it can be registered. After registration, B refused to buy the land already. Was there a perfected contract of sale? a. Yes, because there was an offer which was accepted by B already thus A can demand for specific performance. (De la Cavada v Diaz: promise was accepted right away and the promise was mutual. a promise made by one party, if in accordance with the form required by the law may be a good consideration for a promise made by another) b. No, because it was only an option to buy with a condition. c. Yes, because the condition was fulfilled already thus A can demand for specific performance. d. No, because there was no meeting of the minds as to the sale of the land but only to the condition of the eventual sale of the land. 19. A was a lessee of B's building with an agreement of right of first refusal should the building be sold. However, B sold the building to C. What is A's remedy? a. File a suit for specific performance because there was an existing agreement of right of first refusal. b. File an action for rescission of the contract of B and C on ground of fraud and his right of first refusal c. File an action for recovery of damages against B for violation of the right of first refusal (Ang Yu v CA - can't file for SP. It's only a right.) d. File an action for recognition of the right of first refusal and ask the court for rescind the contract of B and C. 20. Delivery transfer title of the property in the following cases except: a. when the seller isn't the owner of the property b. when payment is made in installments. c. when there's no full payment of price yet d. when on a sale on trial, he fails to give the goods back upon expiration of period

21. A bought logs from B with the agreement that B would deliver the logs alongside the vessel. While in transit, the vessel sank thus A sued B for recovery of payment made for the logs. Will the suit prosper? a. Yes, because B had the responsibility of keeping the logs in good condition until it was delivered to A. b. No, because there was no negligence on the part of A. (---although this could also be an answer------) c. Yes, because there was no delivery yet to A. But B will have an action for recovery against the vessel owner. d. No, because B complied with his responsibility already, by delivery the logs in good condition alongside the vessel. (Bean v Cadwaller) 22. The following are warranties of the seller of the document of title except: a. that the document is genuine b. that he as knowledge of no fact which would impair the validity or worth of the document c. that he has a right to transfer the title to the goods d. that the property sold is not fake nor an imitation 23. The following are remedies of an unpaid seller except: a. possessory lien where the seller reserves his right to possession or ownership of property regardless of delivery b. when goods are in transit and the negotiable instrument has been issued, to have the goods redelivered to him (1532 par. 2) c. right of resale where goods are perishable in nature or where seller expressly reserves that right d. right to rescission of the contract of sale 24. A bought machines for production of Christmas decorations from B which he promised to deliver by October. On the first week of October, A signed the contract of sale and believed the promises of B that the machines were on their way already. However, when it still didn't arrive on the first week of November, A made demands. The machines never arrived that year. What remedy could A have against B? a. an action for specific performance as there was delay already and B didn't comply with it yet. b. action for rescission of the contract because despite demands, there was still no delivery (soler v cheeky: time is of the essence here (machines in time for Christmas season, he signed the contract believing that the machines were on their way) c. action for recovery of damages because the right of A vested by B to have it on time (for the Christmas season) was violated by B. d. action for specific performance and damages because there was delay and the right to have it on time was violated. 25. The vendee loses his right to make use of a term in the following except: a. when he becomes insolvent

b. when he fails to pay two or more installments c. when there are no guaranties d. when he violates his undertaking in consideration of period 26. A bought a condominium unit from B worth 10,500,000 measuring 90 square meters in area. After payment had been made, possession and ownership was turned over to A. When A transferred, he found out that the unit was only 75 square meters big. Although he still continued to occupy the property, A demanded refund from B for the difference of 15 square meters (1,750,000). Is B obligated to give the excess? a. Yes, because clearly there was fraud. The contract explicitly stated 90 square meters b. No, because there was negligence on the part of A. He should have inspected and surveyed the property even before full payment c. Yes, because there was an error or mistake in fact as to the measurement. d. No, clearly, the condo unit was purchased for a lump sum and not for a piece rate as stated in the contract that the condo unit was for 10,500,000. (1542 and 1539) 27. A bought a residential house from B for 50 million pesos payable in 10 years at at a bi-annual installment payment scheme. On the sixth year, A failed to pay an installment but was only able to pay it the following year. However, on the eigth year, A again failed to pay. This time, after repeated demands from B, A failed to pay. B filed an action for rescission of contract. Will the suit prosper? a. No, because he had already paid for more than 7 years. He had paid more than half already. b. Yes, because he failed to pay the 2nd installment despite repeated demands but he is entitled for a refund for the payments made. c. No, because according to the Maceda Law, a one month grace period can be given for every year paid. d. Yes, because he has already been in delay twice in five years, although he is entitled to a refund. (Maceda law, grace period can only be used once in every five years) 28. A sold an antique jar to B explaining to him that acquired it from C, a certified expert antique dealer and relaying to him what C said that it was already 200 years old and made from real jade. Relying on A's explanations, B bought it. However, when B had it inspected by an antique dealer, the jar turned out to be fake. A filed an action for recovery of payment on ground of fraud of the contract. Will the suit prosper? a. No, because there was no fraud to begin with as B agreed to purchase it relying solely on A who wasn't an antique dealer. (1340, 1341 - B wasn't the antique dealer but C. A relied only on B, not C) b. Yes, because B relied on A's explanation which came from C, an expert on antique jars c. No, because B should have it checked before buying it

d. Yes, because an expression of opinion doesn't signify fraud unless made by an expert an C clearly was an expert in antique jars. 29. when the warranty against eviction has been agreed upon or nothing has been stipulated on this point, in case eviction occurs, the vendee shall have the right to demand of the vendor the ff. except: a. the return of the value which the thing sold had at the time of the eviction be it greater or less than the price of the sale b. the damages and interests, and ornamental expenses if the sale was made in bad faith c. the costs of from breach of contract of sale (1551: correct one is the cost of suit which caused the eviction) d. the income or fruits if has been ordered to deliver them to the party who won the suit against him. 30. A bought a motorcycle from B with a factory machine as the mortgage. Payment was to be made in installments. However, A failed to pay 3 installments already thus B chose to foreclose on the machine. When the machine still didn't satisfy the entire payment of the motorcycle, B wanted to foreclose on the 2nd mortgage which was made after the 1st default on the installment. A said he couldn't foreclose on the 2nd mortgage anymore. Who is correct? a. A, because B having foreclosed on the first mortgage, no further action is allowed including the foreclosure of the 2nd mortgage. (Cruz v Filipinas, Recto Law) b. B, because he had the right to foreclose on both mortgages since they were purposely made in connection of the sale. However, he can't avail of the other remedies anymore. c. A, because B having foreclosed on the first mortgage, he already bound himself to that action. d. B, because he can exhaust all the remedies until full payment of price can be acquired.