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JayArhSals
A Compilation of the
Questions and Suggested Answers
In the
PHILIPPINE BAR EXAMINATIONS 2007-2013
In
MERCANTILE
LAW
Compiled and Arranged By:
Salise, Hector Christopher Jay-Arh Jr. M.
(University of San Jose-Recoletos School of Law)
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FOREWORD
This work is a compilation of the ANSWERS TO BAR
EXAMINATION QUESTIONS by the UP LAW COMPLEX ,
Philippine Association of Law Schools from 2007-2010 and
local law students and lawyers forum sites from 2011-2013
and not an original creation or formulation of the author.
The author was inspired by the work of Silliman Universitys
College of Law and its students of producing a very good
material to everyone involved in the legal field particularly the
students and the reviewees for free. Hence, this work is a
freeware.
Everyone is free to distribute and mass produce copies of this
work, however, the author accepts no liability for the content of
this reviewer, or for the consequences of the usage, abuse, or
any actions taken by the user on the basis of the information
given.
The answers (views or opinions) presented in this reviewer are
solely those of the authors in the given references and do not
necessarily represent those of the author of this work.
The Author.
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TABLE OF CONTENTS
(Titles are based on Sillimans Compilation [Arranged by Topic])
General Principles
Presumption: Habitually Engaging in Commerce (2009).............9
Banking Law
Banks; Bank Deposits vs. Deposit Substitutes (2010)..............................................................9
Banks; Deposit: Safety Deposit Box, Relationship from Banks (2010)................................ 10
Banks; Money Laundering: Predicate Crimes (2007)..............................................................10
Banks; Mortgage; Redemption (2007)...................................................................................... 11
Banks; Insolvency; Actions of the Monetary Board (2009)................................................... 12
Banks; Insolvency; Claims (2010)............................................................................................13
Banks; Receivership (2007)........................................................................................................13
Banks; Receivership; Prohibited Transaction (2009)............................................................ 14
Banks; Secrecy of Bank Deposit; AMLC (2013).......................................................................14
Banks; Secrecy of Bank Deposits (2009)..................................................................................15
Banks; Single Borrowers Limit; Collateral Security (2008)..................................................16
Banks; Types of Banks (2010)...................................................................................................16
Truth in Lending Act (2009).....................................................................................................17
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Corporation Law
BOD; Conflict of Interest; Ratification (2008)........................................................................20
BOD; Qualifications (2012)....................................................................................................... 21
Corporation; Dissolution (2012)............................................................................................... 23
Corporation; Formation; Enactment of a Law (2008)............................................................ 24
Corporation; Sole Proprietorship (2010)..................................................................................24
Derivative Suit; Expiration of Term (2013)............................................................................ 26
Derivative Suit; Jurisdiction (2009).........................................................................................26
Dividends; Declaration of Dividends (2009)............................................................................ 27
Dividends; Declaration of Dividends (2009)............................................................................ 28
Dividends; Declaration of Dividends (2008)............................................................................ 28
Liabilities; BOD; Corporate Acts (2012)................................................................................... 29
Piercing the Corporate Veil (2008)...........................................................................................31
Stock and Transfer Book (2009)................................................................................................32
Stockholders; Appraisal Right (2007)...................................................................................... 32
Stockholders; Contractual Relationship; Quorum (2009)..................................................... 33
Stockholders; Preferred Shares (2013).................................................................................... 34
Trust Fund Doctrine (2007)......................................................................................................35
Ultra Vires Acts (2009)............................................................................................................... 35
Credit Transaction
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Insurance Law
Beneficiary; Death of Insured Due to Beneficiary (2008)..................................................... 45
Concealment; Material Concealment (2013)........................................................................... 45
Insurable Interest; Building Destroyed by Fire (2010).......................................................... 46
Insurance; Double Insurance, Validity (2012).........................................................................47
Insurance; Perfection of Insurance Contracts (2009)............................................................ 47
Insurance; Property Insurance; Assignments (2009)............................................................. 48
Insurance; Property Insurance; Late Payment of Premiums (2010).................................... 49
Insurance; Property Insurance; Payment of Premiums by Check (2007)........................... 50
Insurance; Property Insurance; Payment of Premiums even after Loss (2013).................51
Insurer: Effects: Several Insurers (2008).................................................................................51
Intellectual Property
Agreements: Technology Transfer Agreements; Requisites & Prohibitions (2010)............52
Article of Commerce; As Trademark, Patent & Copyright (2010)........................................53
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Copyright (2013)........................................................................................................................ 54
Copyright; Commissioned Artist (2008)..................................................................................54
Copyright; Commissioned Work (2008)................................................................................... 56
Copyright; Infringement (2007)................................................................................................57
Denicola Test (2009)...................................................................................................................57
Infringement; Claims (2010)..................................................................................................... 58
Infringement; Trademark, Copyright (2009)........................................................................... 59
Patent: Non-Patentable; Method of Diagnosis & Treatment (2010)......................................60
Trademark; Unfair Competition (2010)................................................................................... 61
Letters of Credit
Independence Principle (2010)..................................................................................................61
Letter of Credit (2012)............................................................................................................... 62
Letter of Credit; Liabilities of a Confirming and Notifying Bank (2008).............................63
Maritime Commerce
Averages: Types (2010)..............................................................................................................64
Barratry (2010)........................................................................................................................... 64
Carriage of Goods; Deviation; Liability (2009)........................................................................65
Carriage of Goods; Implied Warranty; Liability (2010).......................................................... 65
Carriage of Goods; Indemnity; Jettisoned Goods (2010).......................................................66
COGSA; Prescription of Claims/Action (2010)........................................................................67
Liability; Loss; Fortuitous Event (2008).................................................................................. 67
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Securities Regulation
Howey Test (2009)......................................................................................................... 77
Insider Trading (2013) .................................................................................................. 77
Insider Trading (2008) .................................................................................................. 78
Investment Contract; Procedure (2010) ........................................................................ 79
Margin Trading Rule (2009) .......................................................................................... 80
Securities; Exempt Securities (2009) ............................................................................ 80
Securities; Selling of Securities (2009) .......................................................................... 81
Tender Offer (2010) ...................................................................................................... 82
Transportation Law
Carriage; Breach of Contract (2008) .............................................................................. 83
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General Principles
Presumption:
Habitually Engaging in
Commerce (2009)
No.V. Cecilio is planning to put up a grocery
store in the subdivision where he and his
family reside. To promote this proposed
business venture, he told his wife and three
children
messages
to send
to
all
out promotional
the
residents
in
text
the
legal
presumption
of
commercial
operation.
Text
endorsement,
Banks;
Bank
Deposits
vs.
of
debt
obligations.
Banking Law
acceptance
purchasing
electronic documents.
or
of
receivables
These
and
instruments
other
may
Substitutes (2010)
SUGGESTED ANSWER:
Bank deposits are funds obtained by a
Bank Act).
substitutes
are
alternative
forms
of
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SUGGESTED ANSWER:
Any one of the following 4 purposes for
requiring banks to maintain reserves
against
their
deposits
and
deposit
help
Government
to
finance
its
operation;
(4) To help the Government control money
supply.
Banks;
Deposit:
Safety
Deposit
Box,
ALTERNATIVE ANSWER:
The legal relationship of the bank and its
safety deposit box client is that of lessor
Banks;
and lessee.
Crimes (2007)
Money Laundering:
Predicate
SUGGESTED ANSWER:
Any five of the following are predicate
crimes to money laundering:
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(11)
(12)
and
murder,
Revised
(4) Plunder under Republic Act No. 7080, as
amended;
Penal
defined
Code,
as
under
the
amended,
as
non-combatant
persons
and
similar targets;
(13)
Fraudulent
practices
and
other
otherwise
known
as
the
securities
1602;
(14)
under the
(7) Piracy
on the
high seas
under
Article
315
of
the
(10)
On
December
4,
2003,
RED
extra
judicially
foreclosed
the
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to
redeem
the
property
until
Banks;
Insolvency;
Actions
of
the
Maharlikang
Corporation
(MPBC)
Pilipino
operates
Banking
several
There
possibly
incurring
continue
in
substantial
business
losses
without
to
its
Report,
without
no
requirement
that
an
is
need
of
an
on
its
business
due
to
its
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SUGGESTED ANSWER:
The order of the Monetary Board may be
questioned on a petition for certiorari on
the ground that the action taken was in
excess of jurisdiction or with grave abuse
of discretion amounting to lack or excess
of jurisdiction. The petition of certiorari
may only be filed by the stockholders of
record representing the majority of the
capital stock within ten (10) days from
receipt by the board of directors of
MPBC
of
receivership,
the
order
directing
liquidation
or
can
recover
P500,
000.00,
time
deposit
and
current
of
and the money market placements are
not included in the insured deposits
(section 4(f) of Republic Act No. 3591, as
amended).
the
construction
of
the
21-storey
Due
to
growing
financial
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(Abacus
Development
Banking
Real
Estate
Center,
Inc.
v.
Manila
Corporation,
455
SCRA
97
(2005)).
(B) Will a suit to enforce the exclusive right
of the investors to purchase the property
prosper? Reason briefly.
SUGGESTED ANSWER:
No, the exclusive options granted to the
investors, having been entered into by
one without authority to do so, is
unenforceable.
cannot
be
The
bank,
compelled
to
therefore,
sell
the
of
administered
Z
for
Bank
the
should
benefit
of
be
its
Banks;
Receivership;
Prohibited
Transaction (2009)
No.I. (E) A bank under receivership can still
SUGGESTED ANSWER:
During
assets
and
corporation
the
receivership,
properties
are
being
of
gathered
the
the
for
organization
whose
by
fictitious.
Congressman
the
Commission
Other
on
than
Abner
to
Audit
to
prepare
likewise
does
be
and
not
congressmen
converted
most
of
the
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and
the
other
transactions
congressmans
bank
accounts.
As counsel for BDP, would you advise the
bank to comply with the order? (8%)
SUGGESTED ANSWER:
I shall advise Banco de Plata not to
comply with the order of the Anti-Money
Laundering Council. It cannot inquire
into the deposits of Congressman Abner,
regardless of currency, without a bank
inquiry order from a competent court,
because
crimes
involved
are
not
Dangerous Drugs
and
Act
other
No.
murder,
violations
6235,
and
Act,
of
destructive
terrorism
and
The
Anti-Money
Laundering
Council
and
other
transactions
Laundering
Act;
Republic
v.
litigation.
pending
bank
Ombudsman
public
may
order
officer,
the
the
bank
litigation
considered
the
Ombudsman
of
not
by
deposits
is
Investigation
to
allow
as
the
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Banks;
Single
Borrowers
Limit;
The
loan
was
secured
by
Celestial
Properties
that
it
Properties
countered
that
the
essentially
indivisible
in
SUGGESTED ANSWER:
2000).
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SUGGESTED ANSWER:
financial
chosen
credit;
(3)
promissory
discount
notes,
and
drafts,
negotiate
bills
of
investing
them
in
outlets
services,
industry
and
and
allied
market
and
services
for
its
constituencies
financial
enterprises and individuals (Section 3
(a), Rep. Act No. 7906 Thrift Banks Act
and
credit
services
to
of 1995).
SUGGESTED ANSWER:
A
rural
bank
is
one
to
Philippines).
to
the
people
of
the
rural
SUGGESTED ANSWER:
the
Code
to
SUGGESTED ANSWER:
provide
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Venezia
to
interests,
disclose
charges
in
and
detail
other
the
figures
chain
with
outlets
in
Makati,
fixtures
and
other
assets
to
its
competitor.
(A) Venezias Manila outlet constitutes onethird of its total business. Should it comply
with the requirements of the Bulk Sales
Law? Why or why not? (2%)
SUGGESTED ANSWER:
need
not
comply
with
the
not
conducted
by
Venezia.
it
need
to
comply
with
the
of
trade
and
the
regular
SUGGESTED ANSWERS:
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complied with.
mortgage,
or
assignment
under
receiver
has
judicial
the
receivership.
option
to
sell
The
or
either
option,
the
requirements
(2007)
No.XII. Seeking to Streamline its operations
and to ball out its losing ventures, the
stockholders of X corporation unanimously
SUGGESTED ANSWER:
(5%)
SUGGESTED ANSWER:
No. the transaction is not covered by the
provisions of the Bulk sales law, Bulk
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sales
law
applies
only
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to
retail
apply
to
manufacturers.
Corporation
is
engaged
manufacturing
bank
of
the
business
Phil.
V.
in
X
the
(Development
Judge
of
the
When the
1137 (1987)).
ALTERNATIVE ANSWER:
complied
with,
sale
as
void
even
civil
liabilities
fraudulent
is
considered
and
being
the
when
arising
coupled
from
and
with
the
Corporation Law
SUGGESTED ANSWER:
BOD; Conflict of Interest; Ratification
To effect a valid sale. X corporation
(2008)
of
all
its
creditors,
their
their
maturities.
Corporation
SUGGESTED ANSWER:
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execute
them
on
behalf
of
said
company.
On the other hand, if the contracts were
duly approved by the Board of Directors
of the office building company with
Paolo
duly
designated
as
company
unless
all
the
following
was
not
necessary
for
the
domestic
full disclosure of the adverse interest of
Paolo to Pedro.
corporation
(100%)
Filipino
SUGGESTED ANSWER:
No.VI. X is a Filipino immigrant residing in
Sacramento, California. Y is a Filipino
and subscribers.
Filipinos,
with
representative.
CCC
Corporation
foreign
corporation
Philippine
Commission.
registered
Securities
KKK
as
and
authorized
is
with
a
the
Exchange
Corporation
is
Note,
however, that
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are
not
subject
to
the
same
be
persons;
either
and
incorporators
natural
third,
cannot
or
the
juridical
number
exceed
of
fifteen
the
appropriate
requirements
of
cases,
with
the
the
Securities
Regulation Code).
(C) Who are qualified to become members of
the board of directors of the corporation?
(2%)
SUGGESTED ANSWER:
of
the
capital
stock
of
the
application
Dummy
Law
nationalized
which
(e.g.,
the
applies
businesses).
Antito
all
Accordingly,
SUGGESTED ANSWER:
The Corporation Code does not impose
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(E)
Who
can
be
appointed
Corporate
Secretary? (2%)
SUGGESTED ANSWER:
The Secretary is required to be both a
resident and a citizen of the Philippines
(Sec. 10, Corporation Code).
[Note: The problem does not state what kind
of business the corporation would engaged
in. Neither does it state whether X,Y,Z and T
are all of legal age and otherwise have the
capacity to enter into contracts. Accordingly,
the suggested answer set out below assume
that the corporation would not be engaging
in a nationalized activity and that X,Y,Z and
T are all of legal age and otherwise have the
capacity to enter into contracts.]
to
BBB
Banking
Corporation
of
Corporation.
all
depositors
of
AAA
automatically
dissolve
or
separate
approval
by
the
Monetary
Board.
SUGGESTED ANSWERS:
No,
the
sale
of
all
the
assets
and
dissolve
AAA
Corporation
or
to
the
Board
of
Directors
of
AAA
least
two
thirds
of
the
total
SUGGESTED ANSWERS:
A
corporation
may
be
dissolved
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certificate
of
registration
of
by
law,
including
the
private
corporation.
What
It
is
only
government
Corporation
Code
are
applicable
government
corporations
only
to
in
suppletory manner.
of
sized
its
charter.
The
National
Power
restaurant
business
that
will
chartered
Corporation
by
the
(NPC
general
is
provisions
of
the
of
Directors
of
private
The
provisions
of
the
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as
the
legal
disadvantages
of
advantages
using
and
separate
Dianne
will
corporation,
set
her
up
liability
separate
for
its
in
the
case
of
form
single
proprietorship.
If
Dianne
will
separate
SUGGESTED ANSWER:
restaurant business.
share
of
the
capital
stock
of
the
you
advise
your
client
to
use
his
name
corporation,
directors
on
and
must
Philippines
the
books
majority
of
the
residents
of
the
be
(Section
25
of
of
the
the
Corporation Code).
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Page 25 of 173
Derivative
Suit;
Expiration
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of
Term
(2013)
No.VIII. In the November 2010 stockholders
meeting of Greenville Corporation, eight (8)
directors were elected to the board. The
directors assumed their posts in January
2011. Since no stockholders meeting was
held in November 2011, the eight directors
served in a holdover capacity and thus
continued discharging their powers.
In
individual
to
fill
in
the
two
expiration
of
term,
must
be
the
SUGGESTED ANSWER:
new
stockholder,
removal
or
on
intra-corporate
controversy
firm
engaged
in
real
estate
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assetsa
three-hectare
land
valued
at
are
supposed
to
protect
the
no
exhaustion
SUGGESTED ANSWER:
remedies.
of
administrative
stockholder
stockholders
who
against
are
officers
other
and
in
the
Regional
Trial
Court
Dividends;
Declaration
of
Dividends
(2009)
No.I. (D) Dividends on shares of stocks can
only
be
declared
out
of
unrestricted
SUGGESTED ANSWER:
True. Dividends on shares of stock of a
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(3%)
Dividends;
Declaration
of
Dividends
(2009)
No.XVI. On September 15, 2007, XYZ
Corporation
hundred
issued
to
preferred shares
Paterno
with
eight
the
ff.
terms:
(1)
(2)
conditions
provided
in
the
stock
SUGGESTED ANSWER:
retained
earnings.
Dividends;
Declaration
of
Dividends
(2008)
No.XIV. Ace Cruz subscribed to 100,000
shares
compelled.
While
the
certificate
of
stock
of
JP
Development
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SUGGESTED ANSWER:
to
all
the
rights
of
stock
dividends
corporation
out
of
the
may
declare
unrestricted
ALTERNATIVE ANSWER:
Under Sec. 71, only when a stockholder
has been declared delinquent do his
rights as stockholder become suspended.
It means therefore that a stockholder
who has not paid the full subscription,
provided he is not declared delinquent
has complete exercise of all of his rights,
including the right to receive dividends.
But
any
cash
dividends
due
on
stockholder
(B) On December 1, 2008, can Ace Cruz
Certificate
is
of
not
Stock
until
he
has
amount
of
his
remitted
issue
him
the
stock
certificate
full
to
the
entitled
(2%)
SUGGESTED ANSWER:
No,
Ace
Cruz
cannot
compel
JP
Corporation.
is
one,
entire
and
divided
into
portions.
The
F,
the
general
manager,
by
the
Board
of
Directors.
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firm
incurred
damages.
The
and
the
General
Manager
supplies
contrary
to
the
incorporation
and
by-laws
of
the
F.
As
officers
the
and
corporation
Board
acting
of
in
Directors
behalf
of
of
corporation. (4%)
SUGGESTED ANSWERS:
A corporation would be liable for the acts
the
directors
have
personality
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 30 of 173
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JayArhSals
to
the
corporation,
its
solidarily
liable
with
the
Company.
Nelson
Acting
for
contracted
the
the
protective
net
atop
the
company
proceeded
with
the
wrong committed.
SUGGESTED ANSWER:
The contractor should also be held liable,
I would sue Nelson, as the person who
owned
and
controlled
Contruction
Company,
doctrine
piercing
corporate
of
fiction.
Sonnel
under
the
veil
Although
the
people.
of
a
stockholder-officer
SUGGESTED ANSWER:
I would use the theory that the company
cannot
be
held
liable
for
damages
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 31 of 173
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JayArhSals
held
liable
negligence.
for
would
the
contractors
also
argue
that
SUGGESTED ANSWER:
availed
of
showing
fraud
separate
juridical
without
or
clear
evidence
disrespect
of
the
personality
of
the
installment,
statement
of
every
of stock
SUGGESTED ANSWER:
Corporation Code).
use
extraordinary
diligence
in
No.VII.
preferred
shares.
driving
motor
vehicle
has
been
In
stockholders
voting
shares
Thereafter,
to
meeting,
non-voting
submitted
his
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 32 of 173
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JayArhSals
right
stockholder,
is
who
the
right
dissents
from
of
a
to
withdraw
from
the
(Section
81,
Corporation
Code).
cannot
appraisal
exercise
in
this
the
case.
right
of
When
new
appraisal
stock
right
of
certificates,
S
ceased,
and
the
T
Code).
Quorum (2009)
contractual
the
outstanding shares.
the
Securities
and
Exchange
relationship
stockholders,
and
between
between
the
the
and
the
stockholders,
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 33 of 173
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JayArhSals
v.
Court
of
Appeals,
454
SCRA
54
(2005)).
This
includes
the
33
transfer
book,
there
being
no
(Section
52
in
Relation
to
Commission.
Its
authorized
Currently,
SUGGESTED ANSWER:
the
issued
and
outstanding
not
constitutional
exceed
40%.
requirement
Since
the
of
60%
common
filed
shares.
suit
was
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 34 of 173
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JayArhSals
creditors
and
other
only
in
instances
specifically
enters
into
SUGGESTED ANSWER:
its
primary
contract
purpose,
without
the
the
board
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 35 of 173
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JayArhSals
Credit Transaction
Chattel Mortgage; Foreclosure (2009)
No.III. Armando, a resident of Manila,
borrowed
P3-million
from
Bernardo,
SUGGESTED ANSWER:
The execution of only one Affidavit of
SUGGESTED ANSWER:
should
Deeds
be
of
registered
Makati
in
City
the
chattel
where
the
Page 36 of 173
hectorchristopher@yahoo.com
JayArhSals
and
mortgages
has
and
no
application
other
forms
to
of
the
the
mortgage
on
The
Honda
remedies
available
to
pursue.
waiver
of
the
chattel
SUGGESTED ANSWER:
Bob
has
the
legal
right
to
file
Page 37 of 173
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JayArhSals
SUGGESTED ANSWERS:
house
in
Tagaytay
City.
The
will
secure
the
payment
of
extrajudicial
foreclosure
proceedings.
(A) Will the extrajudicial foreclosure prosper
considering that the additional Php5Million
was not covered by the registration? (5%)
SUGGESTED ANSWERS:
Mortgages
future
legal
mortgage
clause.
given
advancements
are
to
secure
valid
and
clause
A
or
mortgage
an
with
anaconda
a
dragnet
dealings,
the
nature
or
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 38 of 173
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JayArhSals
documents,
thereby
saving
Alviar, id.)
the
mortgagor
for
which
other
adopted the
reliance on
the
foreclosure
of
the
old
security
separately
any
(2%)
collateralized
and
for
SUGGESTED ANSWER:
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 39 of 173
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JayArhSals
and
it
becomes
final
and
SUGGESTED ANSWER:
SUGGESTED ANSWER:
SSS Bank and BBB Bank could each
file an ordinary action to collect its
loan from X.
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 40 of 173
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JayArhSals
of
Marquezs
shares
in
the
(A) Can
the
bank
sue
Marquez
for
the
institute
real
action
to
Recovery
of
Marquez
and
recover
the
extinguishes
the
SUGGESTED ANSWER:
the
SUGGESTED ANSWER:
Under
the
Insolvency
law
necessary
Debts
due
for
personal
services
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 41 of 173
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JayArhSals
laborers,
or
immediately
domestic
servants
preceding
commencement
of
the
proceeding
in
insolvency;
thirty-four
hundred
and
Thirty-eight
hundred
and
Eighteen
hundred
and
Rehabilitation;
Philippine
Islands
(Section
50,
Insolvency Law).
Proceeding;
corporation above?
SUGGESTED ANSWER:
SUGGESTED ANSWER:
Yes,
when
petition
for
distressed
insolvency
corporations
has
been
and
Sec.
5[d],
Securities
Regulation Act).
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 42 of 173
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JayArhSals
in
cases
where
corporation**possesses
property
to
cover
all
the
sufficient
its
debts
but
under
the
management
of
SUGGESTED ANSWER:
Receiver,
Although in Ching v. LBP, G.R. No.
73123, 02 September 1991, it was held
that when a petitioning corporate debtor
has been denied rehabilitation, the SEC
may declare a corporation insolvent as
an incident and in continuation of its
already
acquired
jurisdiction
over
Procedure
for
Corporate
Rehabilitation.
terminate
without
the
proceedings,
proceeding
to
different
proceedings
petition
fall
for
with
insolvency
the
general
porprio
or
upon
the
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 43 of 173
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JayArhSals
ahead
of
the
others.
This
is
all
pending
corporation
claims
under
against
the
receivership
30
September
2005:
Ruby
Order
included
in
enforcement
of
claims
against
was
on
claims
Corporate
against
Rehabilitation
letters
of
(2008)
credit
and
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 44 of 173
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JayArhSals
insured.
Insurance Law
Beneficiary; Death of Insured Due to
Beneficiary (2008)
No.VI. On January 1, 2000, Antonio Rivera
secured
life
insurance
from
SOS
his
adopted
daughter,
as
the
ascertained
that
Gemma
Rivera
of
said
insurance,
disqualified.
if
Thus,
not
the
Material
Concealment
(2013)
SUGGESTED ANSWER
The
rescinded
Benny
named
his
children
as
his
The
insurance
company
insurance
the
the
policy
correctly
because
of
suffering
hypertension,
denied
company
and
from
diabetes,
hepatoma.
The
Insurance Code).
been
diagnosed
to
be
suffering
from
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 45 of 173
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JayArhSals
Company
for
P10
million,
he
had
been
storing
Insurance
Company.
As
919
(1955)).
Armando
cannot
Globe
&
Rutgers
Fire
Insurance
insurance
policies
contain
Company,
30
Phil.
617
Company
from
liability
to
only
collect the
balance of
P5
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 46 of 173
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JayArhSals
separately
Insurance;
Double Insurance,
Validity
(2012)
No.V X borrowed from CCC Bank. She
mortgaged her house and lot in favor of the
bank. X insured her house. The bank also
got the house insured.
(A) Is this double insurance? Explain your
answer. (3%)
SUGGESTED ANSWER:
No, there is no double insurance. Double
insurance exists where the same person
is insured by several insurers separately
with respect to the same subject and
interest. (Sec. 93, Insurance Code)
(B) Is this legally valid? Explain your
answer. (3%)
SUGGESTED ANSWER:
Yes, X and CCC Bank can both insure the
house as they have different insurable
interest
therein.
X,
the
borrower
interest
in
the
house
as
mortgagee thereof.
(C) In case of damage, can X and CCC Bank
claim
proceeds? (4%)
for
the
insurance
the
damage
but
not
to
exceed
the
SUGGESTED ANSWER:
could
corresponding
claim
to
the
an
extent
amount
of
the
Insurance;
Contracts (2009)
No.IV.
Perfection
Antarctica
Corporation
(ALAC)
of
Insurance
Life
Assurance
publicly
offered
may
be
afflicted
with
serious
and
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 47 of 173
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JayArhSals
Quirico
then
requested
ALAC
for
the
raise
funds
to
pay
the
insurance
who
disclosed
that
he
was
SUGGESTED ANSWER:
The issuance of a cover note by ALAC
resulted in the perfection of the contract
of insurance. In that case, it is only
because there is delay in the issuance of
issued.
pending the
issuance of a
LESSOR,
the
insurance
policy
is
Property
Insurance;
Assignments (2009)
No.XIII.
Ciriaco
apartment
from
Notwithstanding
the
stipulation
in
the
leased
Supreme
commercial
Building
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 48 of 173
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JayArhSals
damaging
Ciriacos
leased premises,
merchandise.
Having
Who
is legally
entitled to
receive
the
is
entitled
to
receive
the
Insurance;
Property
Insurance;
Late
Enrique
obtained
from
Seguro
funds.
Upon
notification,
additional
funds
with
the
ALTERNATIVE ANSWER:
SUGGESTED ANSWER:
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 49 of 173
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JayArhSals
307 [2001]).
was
accepted
by
the
insurer,
recovery
under
Alfredos
own
negligence,
can
he
still
the
insurance
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 50 of 173
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JayArhSals
St.
Peter
stable
Manufacturing
Insurance
Company
Company.
is
Stable
each
the
and
Manufacturing
other;
facilities
SPMC
from
SIC.
secures
The
standing
Company
to
pay
the
Insurance
Company
is
in
estoppels
Terrazas
de
Patio
Verde,
fire
with
three
(3)
insurance
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 51 of 173
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JayArhSals
companies
is
recognized
double
under
Sec.
insurance,
93
of
the
28
June
1999,
the
court
insurance
clause
in
fire
can
recover
from
Eastern
the
policy
contains
an
other
law
prohibits
double
or
over-
SUGGESTED ANSWER:
insurance Corp. is liable to the extent of
its coverage but may recover one-half of
the total indemnity from the co-insurers
in the proportion of 60% (Southern
Insurance) 40% (Northern Insurance).
Intellectual Property
Transfer
(2010)
technology
Agreements:
Technology
shall
be
made
available
in
all
agreements? (2%)
technology
transfer
transfer arrangement;
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 52 of 173
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JayArhSals
Commission
on
International
shall
apply
and
the
venue
of
to
the
technology
transfer
in
technology
transfer
agreements. (3%)
SUGGESTED ANSWER:
The following stipulations are prohibited
in technology transfer agreements:
(2) Those
that
competitive
prohibit
technologies
the
in
use
a
of
non-
the
Intellectual
Property
Code).
SUGGESTED ANSWER:
A stamped or marked container of goods
can
be
registered
as
trademark
or
manufacturer
model
for
articles
of
can
be
copyrighted
ALTERNATIVE ANSWER:
It is entirely possible for an article of
commerce
to
bear
registered
most,
or
some
part
of
it
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 53 of 173
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JayArhSals
Copyright (2013)
No.IV. Ruby is a fine arts student in a
university. He stays in a boarding house
with Bernie as his roommate. During his
free time, Rudy would paint and leave his
finished works lying around the boarding
house. One day, Rudy saw one of his works
an abstract painting entitled Manila Traffic
Jam on display at the university cafeteria.
The cafeteria operator said he purchased the
painting
from
Bernie
who
represented
Library
as
provided
in
the
California
record
company,
Galactic
By
2002,
Moeha
Warm
was
nearing
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 54 of 173
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JayArhSals
17
include
the
right
to
demand
his
death,
and
although
he
was
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 55 of 173
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JayArhSals
Films,
it
commissioned
the
remixed
work.
newspaper
of
which
was
owned
by
New
Media
Enterprises.
SUGGESTED ANSWER:
Manila
Enterprises.
Under
publication
Intellectual
Property
Sec.
172
Code,
of
the
original
of their
include
those
in
creation and
shall
periodicals
and
Eloise
of
wants
her
to
prevent
columns
in
the
that
Name
one
irrefutable
legal
Enterprises
from
including
her
Under
the
IPC,
the
prevent
reproduction
copyright
of
the
or
work,
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 56 of 173
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JayArhSals
ALTERNATIVE ANSWER
sale
or
other
forms
of
transfer
of
Diana
and
Piolo
are
famous
liable
for
copyright
infringement?
Greg
is
infringement.
liable
Letter
for
are
copyright
among
the
Property
Code;
Columbia
constitutes
copyright.
infringement
of
The
messages
that
Diana
and
light
of
the
provision
of
the
Piolo
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 57 of 173
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JayArhSals
from
the
utilitarian
aspects;
International,
Inc.
v.Cascade
that
if
there
is
any
aesthetic
While
vacationing
in
Boracay,
(Tolentino,
Commentaries
and
she
have
any
cause
of
action?
(B) Valentinos
friend
Francesco
stole
the
Explain. (2%)
SUGGESTED ANSWER:
sued
Monaliza
cannot
sue
Valentino
for
Francisco
for
infringement
and
cannot
sue
Francesco
for
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 58 of 173
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JayArhSals
only
magazine;
the
photographs
however,
he
to
still
the
retained
cause
of
action
against
Infringement;
Trademark,
Copyright
(2009)
No.XV. After disposing of his last opponent
in only two rounds in Las Vegas, the
renowned Filipino boxer Sonny Bachao
arrived at the Ninoy Aquino International
Airport
met
by
thousands
of
hero-
Bachao
cannot
of
sue
trademark.
for
infringement
photographs
showing
him
The
wearing
Sonny
sees
the
Lacoste
(A) For
trademark
unauthorized
in
the
of
the
published
photographs; (2%)and
SUGGESTED ANSWER:
Sonny
Infringement
use
Bachao
infringement
of
cannot
copyright
sue
for
for
the
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 59 of 173
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JayArhSals
the
newspaper
the
photographs
(Section
177,
without
license
to
do
before
administrative
our
tribunal
courts
(De
Joya
or
v.
how? (4%)
Non-Patentable;
Method
of
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 60 of 173
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JayArhSals
the
right
to
prevent
its
parallel
importation.
(A) Who is correct? Why? (2%)
SUGGESTED ANSWER:
X
is
correct.
His
rights
under
his
competition
(Del
Monte
Letters of Credit
SUGGESTED ANSWER:
A patent for a product confers upon its
Property
of
Code).
patented
The
product
patent
Intellectual
(Subsection
Property
76.1
Code).
of
the
can
credit
are
independent
of
the
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 61 of 173
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JayArhSals
underlying
transaction.
Thus,
the
be
paid
by
the
issuing
or
of
dispute
between
the
independence
principle.
For
be
prevented
through
court
injunction.
Court.
(b) Explain the nature of Letters of Credit as
a financial devise. (5%)
SUGGESTED ANSWER:
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
Page 62 of 173
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JayArhSals
Hydro
shipping
documents
or
issuing
bank.
The
issuing
bank
issuing
bank
and
acquires
the
to
reduce
the
risk
of
non-
as
standby
letters
of
credit.
Corporation,
et
al.,
G.R.
No.
of
Credit;
Liabilities
of
Construction
Corp.
will
pay
the
month
period,
PT
Construction
Corp.
two
companies.
The
Bank
is
Page 63 of 173
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JayArhSals
PT
Construction
Corp.
The
arrangement
that
did
not
of
credit
does
not
involve
Maritime Commerce
Averages: Types (2010)
Code of Commerce).
The types of average are particular and
general (Article 808 of the Code of
Commerce). Particular averages include
all expenses and damages caused to the
Barratry (2010)
insurance? (2%)
SUGGESTED ANSWER:
damages
pursuance
and
expenses
which
are
of
some
unlawful
or
interest
of
the
owner
(Roque
v.
Page 64 of 173
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JayArhSals
The
Global
Transport
Services,
Inc.
laden
10,000
with,among
television
sets
other
goods,
consigned
to
Philippine
realized
that
territory,
MV
Dona
the
Juana
captain
would
jettison
of
Romualdos
TV
sets
him
to
compensation
or
in
general
average
loss,
ALTERNATIVE ANSWER:
The jettison resulted to a particular
average loss because the damage was due
Liability (2010)
from
Manila
to
Nagoya.
the
vessel
irresponsible
was
crew
manned
with
by
an
deep-seated
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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JayArhSals
Constantino
tried
to
collect
from
the
was
irresponsible.
It
is
the
precious cargo.
Goods (2010)
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as
defense
under
the
Explain. (3%)
SUGGESTED ANSWER:
one-year
the
prescriptive
period
in
delivered
in
damaged
or
circumstances
were
present:
(1)
the
and
(3)
the
carrier
exercised
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and
after
the
typhoon
(See
of
maritime
transactions,
the
was
not
due
to its
fault
or
(3%)
SUGGESTED ANSWER:
Yes, because the crew members died
while performing their assigned duties,
Checks:
Forged
Checks;
Liability
of
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payment.
Bank (2010)
SUGGESTED ANSWER:
YAMAHA
Bank.
YAMAHA
Bank
All
endorsement guaranteed.
endorsement
order,
and
is
not
to the
consequently,
the
drawers
drawee
discharged
on
the
instrument?
Why? (2%)
SUGGESTED ANSWER:
No. The payee Gerard can recover as he
still retains his claim on the debt of
Pancho.
prior
endorsements
and/or
lack
of
placement
and
discovers
the
foregoing transactions.
Bank.
Discuss
the
respective
Page 69 of 173
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the
forged
indorsement
of
Deed
of
Assignment
of
various
customers
who
bought
the
ASSIGNOR
irrevocably
agrees
unconditionally
to
pay
the
and
same,
When
the
checks
became
due,
BFC
(of
the
checks);
and
(b)
stopped,
account
under
SUGGESTED ANSWER:
No. Gaudencios defenses are untenable.
dishonored
demanding
checks,
and
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Negotiability (2013)
No.I.
Antonio
issued
the
following
instrument:
August 10, 2013
Makati City
P1OO,OOO,OO
Sixty days after date, I promise to pay
Bobby or his designated representative the
sum of ONE HUNDRED THOUSAND PESOS
(P100,000.00) from my BPI Acct. No. 1234
the day.
and
was
signed
by
the
maker,
sum
certain
in
money,
2013
Instruments Law).
(Section
4(a)
of
Negotiable
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Negotiability (2012)
No.IV. Indicate and explain whether the
promissory note is negotiable or nonnegotiable.
(A)
promise
to
pay
or
bearer
negotiable.
There
is
no
fund,
i.e.,
the
inheritance
negotiable.
There
is
no
are
no
90-day
treasury
bills
maturity.
(See,
among
other,
www.treasury.gov.ph/govsec/aboutsec.h
tml)
(C) I promise to pay A or bearer the sum of
exams. (2%)
SUGGESTED ANSWER:
Not negotiable. The promise to pay is
subject to a condition, i.e., that A will
pass the 2012 bar exams (Sec.1[b],NIL).
2012. (2%)
SUGGESTED ANSWER:
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negotiable
of
negotiability
under
Section 1, NIL.
(E) I promise to pay A or bearer the sum of
Php100,000. (2%)
SUGGESTED ANSWER:
Negotiable. It conforms fully with the
requirements
of
negotiability
under
Negotiable
Instruments;
Illicit/Illegal
Consideration (2007)
No.I. R issued a check for P1m which he
used to pay S for killing his political enemy.
(10%)
not
one
of
the
requisites
of
instruments
(Section
1,
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Negotiable
Instruments;
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JayArhSals
Illicit/Illegal
but
the
latter
promptly
inasmuch
as
she
paid
value
SUGGESTED ANSWER:
Negotiable
Instruments:
Incomplete,
does
Delivered;
Doctrine:
Comparative
not
adversely
affect
the
Negligence (2008)
the
thereto
for
value
(Sec.
24,
officer
intending
to
defraud
the
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Term (2009)
Explain. (3%)
SUGGESTED ANSWER:
The filling up by the officer of his name
as payee does not constitute forgery, and
contemplates a mechanically incomplete
but delivered instrument. Under Sec. 14
of the NIL, in order to enforce an
incomplete
but
delivered
instrument
The
doctrine
of
comparative
How
would
you
decide
the
case?
Explain. (2%)
SUGGESTED ANSWER:
I would find AB Corp. liable for its
negligence in delivering an incomplete
instrument to XY Bank (Sec. 14, NIL).
SUGGESTED ANSWER:
True. The document is subject to a term
and not a condition. The dying of the
dog is a day which is certain to come.
Therefore,
the
unconditional,
order
in
to
pay
compliance
is
with
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engaged
that
on
due
(Sec.
61,
NIL).
No
notice
of
cannot
hold
Y,
the
subsequent
force
payment
against
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JayArhSals
become a lawyer.
Securities Regulation
Howey Test (2009)
No.XI. (C) The Howey Test states that there
is an investment contract when a person
invests money in a common enterprise and
is led to expect profits primarily from the
efforts of others.
SUGGESTED ANSWER:
The Howey Test requires a transaction,
contract, or scheme whereby a person
makes an investment of money in a
common enterprise with the expectation
of
profits to
be derived
solely,
not
unique
products
derived
from
Products
companys
file
planned
containing
corporate
the
financial
funds
for
your
mothers
The
constitute
company
could
no
longer
meet
its
sale
of
the
insider
shares
trading.
does
not
Although
communication
from
him.
He
just
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JayArhSals
(A)
engage
in
unlawful,
dishonest,
planned
provision
of
the
Securities
shares
What
corporate
rehabilitation.
Regulation
Code,
which
through
of
the
information
to
the
directors
and
key
officers
of
the
disclosure
proceedings.
The
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Yes.
insider.
Subsection
3.8
of
the
for
payments
made
by
Center.
Once
the
accumulated
multi-level
marketing
certain
The
(3)
with
expectation
of
(Power
Homes
Unlimited
with
Securities
Commission
Section
Regulation
the
of
Code
in
and
accordance
the
Securities
(Power
Homes
criminal
consequences
(i.e.,
upon
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received
on
the
purchased
or
(ii)
damages
if
the
57
Regulation
and
Code).
Securities
and
73,
Securities
Furthermore,
Exchange
the
Commission
the
Margin
Trading
Rule,
no
an
amount
greater
than
No.X.
market
price
(Section
48,
Securities
Regulation Code).
What
are
the
so-called
exempt
Section
of
the
Securities
encouraging
clients to buy
(A) Those
issued
or
guaranteed
by
the
issued
or
guaranteed
by
the
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authorized
content of disclosures;
timeshares.
to
sell
securities,
including
shares.
securities
above
should
be
requirements
Corporation
Securities
(2008)).
and
Exchange
Commission
under
v.
Lao,
Sec.
544
8of
SCRA
batas
254
ALTERNATIVE ANSWER:
out
of
therefore,
exempt
transactions,
requiring
registration,
and,
is
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JayArhSals
company
has
two
principal
or
Parent
Corporation
controlling
stockholders.
any
is
less
than
35%
P60
million
pesos
with
210
listed
on
the
stock
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JayArhSals
50%.
However,
when
the
than
-51%
thresholds
for
Transportation Law
Carriage; Breach of Contract
No.VIII. City Railways, Inc. (CRI) provides
train service, for a fee, to commuters from
Manila to Calamba, Laguna. Commuter are
required to purchase tickets and then
proceed
to
designated
loading
and
Lines,
train
and
that
it
was
not
guilty
of
Inc.,
G.R.
No.
131166,
30
September 1999).
it
failed
to
exercise
passenger
purchased
proceeded
to
the
his
ticket
designated
and
loading
Universal
(Caltex
Philippines,
Inc.
v.
Sulpicio
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passage
passenger
(Vda.
by
fraud,
is
not
De
nueca
v.
Manial
of
contract
of
carriage.
The
the
conveyance
provided
by
the
the
driver
while he was
SUGGESTED ANSWER:
Explain. (3%)
SUGGESTED ANSWER:
that
the
collision
was
due
to
the
in
the
selection
and
Uriel
if
exempts
there
it
is
from
stipulation
liability
for
that
simple
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CTC
can
also
raise
hectorchristopher@yahoo.com
JayArhSals
against
all
the
driver
(Ampang
v.Guinoo
that
he
was
engaged
in
Since
UTI
had
no
pre-existing
Carriage;
Breach
of
Contract;
No.IX.
Fil-Asia
Flight
916
was
on
approach
and
undershot
the
It
appears
from
the
Civil
Aeronautics
In
your
case
conference,
the
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action? (5%)
SUGGESTED ANSWER:
A complaint for breach of contract of
carriage can be filed against Fil-Asia for
failure
to
exercise
extraordinary
negligence
in
the
selection
and
for
reckless
imprudence
reckless
in
imprudence
resulting
1958).
or
made
known
before
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to
recover
losses
and
damages
from
the
collision
Code of Commerce).
SUGGESTED ANSWER:
A Trust Receipt is a written or printed
building.
ordered
the
entrustee
but
retains
ownership
SUGGESTED ANSWER:
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SUGGESTED ANSWER:
received
the
Construction
for
inconsistent
the
with
loan.
a
trust
This
is
receipt
cannot
No, Tom Cruzs obligation to pay the
loan covered by the trust receipts to XYZ
Bank
remains,
Trust
receipt
is
extinguish
the
principal
(Landl
&
Company
[Phil.]
v.
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When
the
without
extend
any
loan
significant
period
expired
payment
from
filing
of
estafa
pursuant
to
the
received
imported
one
the
year
iron
before
pellets
the
he
trust
the
denominated the
of
receipt
transaction
parties
as
one
trust
Receipts
Law;
Violation
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offense.
intrust
for
BBB
Bank,
as
be
held
liable
under
the
association,
or
other
possession thereof.
[Note:The problem does not state that BBB
bank
issued
letter
of
credit
upon
SUGGESTED ANSWER:
True. A lien is dependent on possession.
When
warehouseman
possession
Receipts Law).
(Sec.29
(a),
surrenders
Warehouse
Receipt:
Surrendering
warehousemen,
issued
negotiable
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to
Caloy
(Section
25,
issued
non-negotiable
warehousemen
issued
non-
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MULTIPLE CHOICE
QUESTIONS (MCQ)
2013 Mercantile Law Exam
MCQ (October 20, 2013)
I. Claude, the registered stock holder of
1,000 shares in ABC Corp., pledged the
shares to Conrad by endorsement in blank
of
the
covering
stock
certificates
and,
of
1.0
Million
that
was
also
properties
whose
possession
double
registration
with
the
SUGGESTED ANSWER:
(D) Yes, because the execution of the
Deed of Assignment of Shares of Stock is
equivalent to a lawful pledge of the
shares
of
stock
(Lopez
v.
Court
of
instructions
from
the
registered
subscription.
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SUGGESTED ANSWER:
None of the answer is correct. The
pledge must be foreclosed. (Article 2112,
Civil
Code)
Conrad
cannot
just
subscriptions
because
under
foreign
investment
in
the
Philippines.
Foreign
Investment
Positive
Lists
concept
(C) The Foreign Investment Negative Lists
concept
(D) The Control Test concept
(E) All of the above.
Philippine
under
FIA
of
91
covers .(1%)
SUGGESTED ANSWER:
national
definition
stock,
outstanding
and
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You
replies
enterprise
that
an
under
export
FIA
91
oriented
is
an
up to 40% equity
(D) Exports consistently at least 60% of its
goods or services produced, and can sell
goods or services to the domestic market
to 100% equity
(E) A real estate development corporation, up
SUGGESTED ANSWER:
to 60% equity
equity
corporations
businesses
in
SUGGESTED ANSWER:
(D)
Jeepney
manufacturing
the
the
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at
the
annual
meeting
of
the
(A) ABC
Corp.
would
need
unrestricted
shares enjoy
of
10
years
without
need
for
of
Brian
for
approached
the
sale
Dennis
of
who
Brians
car,
appeared
SUGGESTED ANSWER:
her.
unrestricted
earnings
provided
that,
(1%)
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payable to him.
Securities
and
Exchange
Commission
(SEC).
(B) Gawsengsit Corp. is not doing business in
the Philippines by its mere investment in a
Bumblebee Corp.
present.
SUGGESTED ANSWER:
SUGGESTED ANSWER:
(B)
SEC.
Gawsengsit
Corp.
is
not
doing
Singaporeans
and
officers
of
Gawsengsit Corp.
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(Rosario
Textile
Mills
Corporation
Home
SUGGESTED ANSWER:
Bankers
Savings
and
v.
Trust
. (1%)
(A) By purchase at a public sale of properties
VIII.
Anton
imported
perfumes
from
business
(C) Through dacion en pago in satisfaction of a
debt in favor of the bank
(D) In exchange for the purchase of shares of
stocks of the bank
(E) All of the above.
purchase
from
real
estate
banks business; or
36
(7)
and
62
(2)
of
the
Corporation Code)
(Section 52 of the General Banking Law)
(1%)
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of
suspicious
or
covered
transaction report
(B) By the Anti-Money Laundering Council
(AMLC) when the account belongs to a
person
already
convicted
of
money
laundering
(C) By the Regional Trial Court, upon ex parte
motion
by
the
AMLC,
in
criminal
10
of
the
Anti-Money
Laundering Act)
certificate
approving
the
Articles.
. (1%)
If
Auto Mo, Ayos Ko is a
. (1%)
the
term
latter
refers
to
the
SUGGESTED ANSWER:
proposal
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the beneficiary.
Under
letter
(A),
to
include
other
This
will
require
the
indebtedness,
then
preferred
Under
Section
of
the
SUGGESTED ANSWER
of Kaddafy Benjelani.
(B) No, the policy is not valid and binding
because
Kaddafy
Benjelani
has
been
Compaia
de
Sejunos
v.
Christern,
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Stay Order.
claim
against
the
debtor
under
MC.
SUGGESTED ANSWER:
rehabilitation.
against
the
bank
(A)
But
Grant
STIs
claim,
Under
the
Worthsell
Shippers,
Inc.,
an
American
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SUGGESTED ANSWER:
What law will govern? (1%)
Act;
Belgian
&Shipping
SUGGESTED ANSWER:
(A) Philippine law (Article
1753, Civil Code)
(Eastern
Shipping
Lines,
Inc.
v.
XV.(2)
Assuming
Philippine
law
to
be
v.
Chartering
2002)
N.V.
Overseas
Philippine
First
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of
Credit
are
financial
upon
payment.
Which
to
reduce
the
risk
of
SUGGESTED ANSWER:
b. standby letter of credit;
theLetter of Credit?
a. No, because the rule of
strict
compliance
commercial
in
transactions
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JayArhSals
funds
will
not
be
4. AAA
Carmakers
opened
an
released.
Corporation
as
irrevocable
Letter
when
the
c. Yes,
claimed
because
by
the
issuing
beneficiary.
of
The,
Credit
was
AAA
Carmakers
instructed
BBB
Banking
as
original copies.
possible?
copies
d. Yes,
are
considered
because
the
issuing
a. No,
because
"Independence
to
conditions
determine
whether
the
under
the
Principle",
for
the
not.
SUGGESTED ANSWER:
subject
c. Yes,
of
importation
because
under
is
the
seller
always
or
the
assured
beneficiary
of
is
prompt
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a. Negotiate
because
what
was
because
under
"Independence
the
Principle",
and
not
with
the
corn.
The
warehouse
receipt
the
warehouse
importation.
to Z to transfer ownership of
the goods.
c. Negotiate
receipt
the
by
warehouse
specifically
indorsing it to Z.
d. The
warehouse
6.
in
SUGGESTED ANSWER:
a.
No,
because
under
the
a.
only
on
documents,
like
the
warehouse
receipt
are
b.
the
lien
of
the
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SUGGESTED ANSWER:
d. All of the above.
7. The
legal
remedy
of
the
an
action
for
interpleader.
b. give the goods to the first one
who
first
presented
the
warehouse receipt.
c. use his discretion as to who
he believes has the prior
right.
d. keep
the
goods
and
c. Yes,
to
BBB
because
violation
of
Banking
prohibita,
intention
is
irrelevant.
Corporation.
SUGGESTED ANSWER:
a.
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consisting
of
dried
fruits
proceeds
for
good
reason.
b. Fraud
or
deceit
is
the proceeds.
Receipts Law.
c. X can be held criminally
liable
under
the
Trust
10.
loan.
a.
SUGGESTED ANSWER:
c.
to
as
President
because
of
For
violation
of
Trust
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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provides
for
accountable
clear
that
concerned
the
officer
participated
in
violation
Receipts
Law,
specifically
of
Trust
the
provides
law
for
one
goods
who
and
holds
the
receives
the
a.
loss;
d. the
collateral;
party
security
who
interest
acquires
in
the
goods.
SUGGESTED ANSWER:
b.
b.
c.
d.
12.
d.
13.
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the
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sentence
b. The
This
promissory
note
is
accommodation party.
b. even
though
the
holder
of payment.
an
accommodation
party.
SUGGESTED ANSWER:
as
accommodation
party.
d. provided
received
the maker.
though
the
amount
holder
an
accommodation
of
HK$50,000
on
or
before
negotiable?
a.
party.
No,
the
promissory
note
b.
accurate?
a. The
promissory
note
is
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dollar
foreign
is
currency
known
in
the
17.
a.
Philippines.
SUGGESTED ANSWER:
still exists.
is
even
stated
though
in
b.
the
foreign
currency.
d.
days.
SUGGESTED ANSWER:
Which
though
did
exists.
not
18.
lacking
in
proper
endorsement.
Manager's Check:
a.
is
check
issued
by
certain
for
b.
is a check issued by a
manager of a bank in the
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bank
itself
for
the
20.
effect.
SUGGESTED ANSWER:
b.
even
it
is
marked
non-
negotiable.
though
to
--
check
bearer
is
which
a
bearer
be
by
be
by
be
by
written indorsement;
c. negotiation
must
specific indorsement;
d. negotiation
must
SUGGESTED ANSWER:
d.
instrument and:
b. negotiation
the same.
is
promissory note.
SUGGESTED ANSWER:
b. Z can claim payment from X
even though it is marked non-negotiable.
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be
used
to
pay
indebtedness.
c. that at all times the delivery
of
the
instrument
is
Bank,
the
drawee
bank.
was
deposited
account.
in
his
even
though
his
of the check.
drawee
bank
is
23.
genuineness
of
the
a.
b.
of the signature.
SUGGESTED ANSWER:
c.
The
endorsee
will
be
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c. is drawn by a maker;
holder
can
become
d. a non-negotiable instrument.
negotiable.
SUGGESTED ANSWER:
SUGGESTED ANSWER:
a. a bill of exhchange
26.
27.
a. Tiger Woods must sign his
real name.
b. Tiger Woods must sign both
his real name and assumed
name.
c. Tiger Woods can sign his
assumed name.
d. the check has become non-
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SUGGESTED ANSWER:
d. It is an invalid indorsement.
SUGGESTED ANSWER:
a. it is an ultra vires act.
b. it is a valid indorsement.
Recommendation in respect of MCQ #27:
It is recommended that examinees be given
full credit for whatever answer they gave as
there are two possible correct answers of
equal value: (a) which is supported by the
case of Jose v. CA, et al., G.R. No. 80599,
September
15,1989,
and
(b)
which
is
sum
is
expressed
both
in
sum
expressed
in
sum
expressed
in
will
render
instrument invalid.
the
30.
a. the sum expressed in words will
prevail
over
the
one
expressed
in
numbers.
insurer
insured
will
equivalent
pay
the
to
the
29.
a.
b.
d.
obligation
of
the
c.
b. the
c. the insured
pays
a fixed
of
the
premiums
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ambiguities
in
the
strictly
accordance
with
in
what
is
to
be
construed
the
liberally
in
insured
favor
of
and
the
insurer.
d. if there is an ambiguity in
the insurance contract, this
will invalidate the contract.
SUGGESTED ANSWER:
b.
a.
the
proceeds
of
the
life
insurance policy,
32.
Y.
d.
the
proceeds
of
the
life
insurance.
life insurance.
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65th
birthday.
The
policy
it
is
with
the
provided
the
a.
b.
SUGGESTED ANSWER:
initio
fraudulent
rescindable
by
reason
concealment
of
or
or
c.
35.
d.
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SUGGESTED ANSWER:
policy
the
insurer
cannot
concealment
or
at
perfection
the
of
the
time
of
contract
at
the
time
of
loss
for
property
at
the
perfection
for
insurance
but
time
of
property
for
life
at
the
perfection only.
time
of
existing
at
the
time
of
property
b. The
37.
express
provision
endorsed is sufficient.
c. Endorsement
of
Insurance
legally allowed.
d. Endorsement
of
the
sufficient?
a formal document to be
a. No, insurance policy must
be expressly endorsed to
valid.
SUGGESTED ANSWER:
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bank
will
have
right
in
the
with
another
passenger
Motor
Vehicular
insurer
of
the
against.
warehouse
40.
was
being
for
used
some
as
hazardous
because
of
the
policy
will
insurance
automatically be changed.
SUGGESTED ANSWER:
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proceeds
of
the
sold
the
partially
because
what
is
approached BlumentrittAvenida
already transferred.
owns
xxx)
partially
burnt
b.
is
still
entitled
to
the
Is PNR liable?
lot.
42.
was
crossing
place
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is
liable
because
public
exercising
a
a
duty
of
reasonable
crossings
a
flagman
which
or
BlumentrittAvenida
Ext.
d. PNR is not liable because X
was negligent, for listening to
his lpod touch while driving.
SUGGESTED ANSWER:
a. PNR is not liable because X
should have known that he was crossing
a place designated as crossing for train,
and therefore should have been more
careful.
43. The AAA Bus Company picks up
passengers
along
EDSA.
X,
the
scope
of
their
responsibility.
liable?
is not
is not
company
can
show
that
SUGGESTED ANSWER:
is
not
part
of
his
the
responsrbility.
employees
liable
for
the
even
or
wilful
though
act
they
of
its
acted
negligence
44.
they
transported by a vessel.
acted
beyond
the
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Because
there
were
so
many
the
Ship
Captain
issued
the
two
(2)
boxes
of
because
lading
was
hence,
no
no
bill
of
to
issued
contract
of
of
carriage
of
only
acceptable
not
be
found.
Which
was negligent.
checked-
in
SUGGESTED ANSWER:
luggage
Transport.
of
the
expressly
baggage
states
Warsaw
Convention
on
Air
Transport.
the
check
that
the
46.
of loss.
allowed
to
use
its
Certificate
of
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passenger
jeepney
met
an
operating
the
by
the
arrangement.
c. X will not be held liable if he
can prove that he is not the
owner anymore.
d. Public Policy dictates that
the real owner, even not the
registered one, will be held
liable.
SUGGESTED ANSWER:
b. X will be the one liable to the
injured party despite the fact that it is Y
who is actually operating the jeepney,
because
tolerated,
while
the
the
Kabit
public
System
should
not
is
be
remains
to
be
the
that
anything
above
Php1
,000
is most accurate?
a. X as the owner is exempt
from liability because he was
not the one driving.
b. X as the owner is exempt
from
liability
because
under
the
"boundary
system".
c. X will not be exempt from
liability
because
he
SUGGESTED ANSWER:
c. X will not be exempt from
liability because he remains to be the
registered
owner
and
the
boundary
and
Exchange
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legal
status
of
the
AAA
Corporation?
a. A de jure corporation;
b. A de facto corporation;
c. A corporation by estoppel;
d. An unregistered corporation.
SUGGESTED ANSWER:
a. A de jure corporation
49. X, the President of ZZZ Corporation,
was authorized by the Board of
Directors of ZZZ Corporation to
obtain a loan from YYY Bank and to
sign documents in behalf of the
corporation. X personally negotiated
for the loan and got tile loan at very
low interest rates. Upon maturity of
the
loan,
ZZZ
Corporation
was
in
behalf
of
the
the
obligation
of
the
signed
all
documents,
the
because
the
pay,
can
be
held
subsidiarity liable.
Corporation
automatically
be
can
held
b. X, as President, cannot be
personally held liable for the obligation
corporation
accurate?
of
SUGGESTED ANSWER:
the
50.
of
loan
even
though
he
of SSS Corporation.
b. TTT Corporation, owned 99%
by X, can automatically be
held liable.
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b. Banks;
juridical
personalities
TTT
hence,
Corporation
the
cannot
the
loan
of
SSS
Corporation.
d. The principle of piercing the
veil of corporate fiction can
be applied in this case.
SUGGESTED ANSWER:
c.
SSS
Corporation
and
TTT
separate
hence,
the
juridical
TTT
personalities
Corporation
cannot
c. Trust companies;
d. All of the above.
52.
b. The
nationality
of
corporation
c. A
sole
depends
corporation
regardless
nationality
of
of
the
sole,
the
head,
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SUGGESTED ANSWER:
c. A corporation sole, regardless
of the nationality of the head, can
acquire real property either by sale or
donation.
53. The
number
of
the
Board
of
than
ten
(1
0)
in
were paid.
c. The
cannot
correct?
a. The Corporate Secretary is
correct
because
the
be
issued
Corporate
to
refuse
Secretary
because
provided
it
is
actual
percentage
of
Corporate
Secretary
fully paid.
stock
b. The
cannot
Stock
Corporate
refuse
Secretary
because
Certificate
can
a
be
certificate
of
the
actual
payment.
a.
The
Corporate
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Secretary
is
Corporation
Corporation
have
and
agreed
YYY
to
be
the
merger,
both
Securities
Commission
and
(SEC)
Exchange
approved
the
effective
date
of
the
the
approval
of
the
effective
date
of
the
and
the
stockholders.
d. The stockholders and the
It
only
requires
the
The
effective
Corporation.
date
of
the
b.
necessary
corporate
exercise
of
power
of
corporation.
Providing
d.
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SUGGESTED ANSWER:
capital
stock
of
of the Corporation.
ABC
and
preferred
58.
Directors
approved
Equality of shares.
b. Classifications
of
a.
in
the
Articles
Incorporation
of
of
b.
c. Classifications of shares is
mainly for business purpose
to attract investors.
d. Classifications of shares may
be allowed with the approval
of the stockholders and the
Board of Directors.
SUGGESTED ANSWER:
the
the
redemption
of
all
stock
The
redemption
of
stock
the
Corporation.
In
such
Corporation.
shares
as it is clearly stated as
ABC
of
is
most accurate?
stock
Which
declared
corporation.
Corporation
shares.
ABC
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hotel
primarily
which
the
is
to
include
separation
of
all
the
change
in
the
shareholder,
change
in
there
is
entity
therefore
and
existing
employees
can
automatically
not
be
considered separated.
c. Y, as the new shareholder,
has the right to retain only
those employees who in his
judgment are qualified.
d. For as long as the existing
employees
are
given
their
terminated.
a.
Although unlicensed to do
business in the Philippines, South China
SUGGESTED ANSWER:
Despite
the
change
in
b.
c.
be considered separated.
d.
60.
company.
South
China
Airlines
SUGGESTED ANSWER:
as
such
and
with
Exchange
the
Philippine
Commission.
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that
ABC
Corporation
could
and
are
the
five
existing
20%
each.
How
will
the
shareholdings
because
the
Corporation
the
extent
of
their
existing shareholdings.
b. The
existing
shareholders'
preemptive
rights
is
of
shareholder
the
existing
can
exercise
b.
shareholdings
the
Corporation
Directors.
c.
extent
of
their
existing shareholdings.
to
62.
a.
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of
Directors
of
CCC
suit
is
an
term
GGG
Corporation
in
accordance
with
its
of
Articles
SUGGESTED ANSWER:
extended. What will happen to the
corporation?
a. The
corporation
ipso facto.
is
65.
corporation to formally go
into liquidation.
d. The stockholders must pass
a resolution to dissolve the
corporation.
a.
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positions
of
the
will
automatically
be
declared
vacant.
d. Acting as members of the
Board of Directors in a hold
over
capacity
must
be
for
an
election
of
the
new
Corporation
is
foreign
As
required
by
the
Corporation
removed
its
revocation or suspension
of its license to do
business.
b. There is no more effect in the
67.
agent
was
appointed.
suspension only.
is most accurate?
a.
SUGGESTED ANSWER:
X is a stockholder of ABC
Corporation as of the time of meeting of
a.
This
can
be
ground
for
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shares
Exchange.
of
at
the
the
board
time
the
the
board
are
to
be
who
is
the
Executive
Vice
shares
Corporation
of
when
ABC
it
was
of which
in
the
Stock
69.
b. bought
shares
Corporation,
of
a
XYC
sister
shares
of
ZZZ
all
shareholders
company
in
opportunity
of
terms
to
sell
a
of
their
shareholdings.
b. ensure
that
minority
shareholders in a publicly
listed company are protected
in the sense that they will
equally
have
the
same
in
terms
of
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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38
Regulation
of
The
Code
Securities
defines
an
corporation
interfere
with
which
his
would
exercise
of
Bangko
Sentral
ng
Pilipinas;
financial
b. the
Philippine
Securities
and
the
quasi-
and
Exchange Commission;
performing
Stock
Exchange;
c. the
institutions
The
Philippine
Deposit
Insurance Corporation;
b.
The
Bangko
Sentral
ng
Pilipinas;
c.
d.
The
government
the
power
of
agency
granted
supervision
and
SUGGESTED ANSWER:
b. The Bangko Sentral ng Pilipinas
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friends
Corporation.
also
has
from
the
savings
is
not
possible
for
specific
the
savings
account
being
Corporation
is
engaged
in
XYZ
through
Corporation
borrowings
raised
from
and
investors.
Which
Corporation
is
eleven
(11)
b. 22;
c. 21;
d. 11.
SUGGESTED ANSWER:
SUGGESTED ANSWER:
c. 21
have
a. 15;
unnecessary
to
an
Investment Company.
75.
used
bank.
c. XYZ
bank
all
the
former
76.
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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housing
loan
of
who
is
not
housing
loan
of
require
(a)
but
will
require (b).
d. The housing loan of X,
being
benefit
for
SUGGESTED ANSWER:
shares
Monetary
the
Board
and
months.
be
78.
provided
such
Can
the
Court
issue
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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because
there
is
the
must
specific
be
subpoena
as
to
which account.
b. Yes, it is enough that the
specific bank is identified.
c. No, because the issuance of
the subpoena has no real
legal basis.
d. Even without a subpoena,
information
about
the
to
the
Sandiganbayan
because
it
in
said
deposit
account
of the account.
big amounts. Which statement is
SUGGESTED ANSWER:
most accurate?
a. The
same
rules
under
approval
from
the
80.
Currency
Deposit
upon
the
written
account.
Each
account
has
Philippine
Deposit
Insurance
to
withdraw
from
all
of
the
accounts.
She then filed her claims with the
Philippine Deposit Insurance
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SUGGESTED ANSWER:
most accurate?
a. X can claim a total of
Php500,000
for
all
the
can
claim
Php750,000
total
from
all
of
the
cannot
from
any
claim
of
anything
the
deposit
accounts.
SUGGESTED ANSWER:
a. X can claim a total of Php
500,000 for all the three (3) accounts.
81. The Bank Secrecy Law (RA 1405)
prohibits disclosing any information
about
deposit
individual
records
without
of
court
an
order
except a. in
an
examination
to
an
investigation
for
an
proceeding.
impeachment
b.
of
Computer
Technology;
a. In an examination to determine
gross estate of a decedent.
Institute
c.
82.
a. X
X;
83.
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competing
which
might
marks
create
confusion.
c. looking at the mark whether
they are similar in size, form
or color.
d. looking at the mark whether
there is one specific feature
that is dominant.
SUGGESTED ANSWER:
b. Focusing on the similarity of
the prevalent features of the competing
marks which might create confusion.
84. X's painting of Madonna and Child
was used by her mother to print
some personalized gift wrapper. As
part of her mother's efforts to raise
funds for Bantay Bata, the mother
of X sold the wrapper to friends. Y,
an entrepeneur, liked the painting in
the wrapper and made many
copies and sold the same through
National
Bookstore.
Which
can
sue
infringement
artistic
because
for
are
works
are
protected
because
works
artistic
85.
creation.
also
to
get
though
not
copyrighted
having
published already.
been
b.
the
Affairs
SUGGESTED ANSWER:
of
the
Director
Intellectual
of
Legal
Property
Office;
c.
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be constituted to secure:
market
of
the
work.
c. effect of the use upon the
public in general.
d. effect of the use upon the
class in which the creator
belongs.
SUGGESTED ANSWER:
b. effect of the use upon the
potential market of the work.
87. Which phrase best completes the
statement - A chattel mortgage can
b.
property;
future;
b. obligations existing at the
time
the
mortgage
c.
being a substitute;
constituted;
d.
being a substitute;
SUGGESTED ANSWER:
88.
is
89.
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not
valid,
binding
hence
between
mortgagor
and
not
the
the
mortgagee;
b. is
binding
between
mortgagor
mortgagee
and
but
the
the
will
not
between
the
and
the
be
valid
mortgagor
mortgagee,
it
must
be
is
binding
between
the
a.
purpose
securing
the
obligations
and valid;
of
b.
the corporation.
parties;
SUGGESTED ANSWER:
c.
the
debtor
resides
and
the
d.
certification
from
the
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of
securing
the
obligations
the
property.
foreclosure,
filed
After
an
the
action
foreclosure
sale.
Which
one
(1)
year
period
questioning
of
the
the
foreclosure
sale.
d. If the action which questions
the validity of the foreclosure
prospers, the period will be
interrupted.
d.
SUGGESTED ANSWER:
b.
c.
94.
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because
it
is
still
who
foreclosed
the
the
redemption
period
and
the
right
to
take
possession
of
the
property.
95. Which phrase best completes the
statement - When a debt is secured
by a real estate mortgage, upon
default of the debtor:
a. the
only
remedy
of
the
principal
executed
amount,
the
installment
which
enough;
collection
Corporation
any
deficiency;
SUGGESTED ANSWER:
Agreement.
Can
XYC
a.
No,
because
handling
deficiency.
banking transactions.
b.
96.
of
Honda
Civic
from
CCC
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amount
of
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the
monthly
of
the
finance
because
Agreement
the
is
Finance
a
valid
of
the
monthly
of
the
finance
97. Which
of
the
following
is
an
BangkoSentralngPilipinas
(SSP) inquiry into or
examination of deposits or
impeachment;
d. Upon
the
inquiry
Commissioner
or
Revenue
to
Philippine
Insurance
Internal
the
event
compromise
his
tax
financial incapacity.
Anti-Money
of
the
in
by
with
inquiry
SUGGESTED ANSWER:
Deposit
Corporation
impeachment.
98.
banking practice;
activities
by
providing
for
more
hence
the
System,
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a. bank
and
any
financial
institutions;
b. pawnshops;
a. It is a list of business
c. casino operators;
activities or enterprises in
the
SUGGESTED ANSWER:
that
c. casino operators
b. It
99. For
Philippines
purposes
of
determining
is
list
of
business
activities or enterprises in
the
Money
engage in.
Laundering
transaction
"Suspicious
is
Law,
considered
Transaction"
as
with
c. It
Philippines
is
list
of
that
business
are
investments provided it is
with
with
the
to
foreign
approval
of the
Board of Investment.
the
open
d. It
capacity;
is
list
of
business
are
open
to
foreign
investments provided it is
or economic justification;
with
c. client
is
not
the
Securities
properly
identified;
approval
and
of the
Exchange
Commission.
in
the
Philippines
that
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driver,
passengers
the
conductor,
disembarked
for
and
the
lunch.
damages.
since
incurred
X
a
Shipping
total
neither
loss
nor
course of a trip.
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governed
by
incorporation.
the
articles
of
since
the
By-Laws
cannot
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since
the
goods
were
company
transportation.
the
completely
finances,
dominates
policies,
and
(D) Yes,
since
the
two
companies
companies
have
the
same
set
of
further
negotiation
and
payment
of
the
instrument.
(D) instruct that payment be made to
the drawee.
(9) Under the Negotiable Instruments Law, a
signature by procuration operates as a
notice that the agent has but a limited
authority to sign. Thus, a person who takes
a bill that is drawn, accepted, or indorsed
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(D) either
actual
or
constructive
receipt.
(12)
the
principal
about
the
(A) rescissible.
(B) unenforceable.
(C) void.
(D) voidable.
amount
indicated
on
the
instrument's face.
(11)
(13)
of
Z collect from X?
(A) conditional receipt.
(B) constructive receipt.
(C) actual receipt.
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(C) Php50,000.00,
but
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with
the
(16)
(14)
set
up
the
defense
of
illegality
of
consideration. Is he correct?
to act on behalf of
and subsisting.
fair
defense.
(15)
value
of
share
of
stock
of
(17)
in the
that
the
carrier
has
an
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By-laws.
parties
and
free
from
defenses
members
decide
otherwise
depreciation
the
share's
fair
value.
in
(21)
vessels
with
Insurance,
Co.
The
was
caused
by
the
extensive
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(D) Yes,
since
and
are
Zs
employees.
(A) No
one,
as
there
is
merely
and C.
partners.
partner.
(24)
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must
first
be
made,
the
since
can
waive
the
return
to
port.
True
enough,
the
policy.
(A) Yes,
(B) at any time before the payment of
premium.
made
because
in
good
the
deviation
faith
and
was
on
(D) Yes,
because the
hectorchristopher@yahoo.com
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deviation took
(B) Yes,
because
it
is
an
original
creation.
(C) Yes,
(28)
because
it
entailed
the
questioned
the
acceptance
(30)
because
the
as
himself
as
Cs
agent,
form
of
the
(B) Yes,
since
only
the
forged
bound as indorser.
(31)
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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(34)
under
car.
any
other
(35)
are
minority
members
contains
an
of
the
since
placed
(B) Yes,
be
incur
free
can
collateral)
bank
(33)
(A) 6
(B) 9
(C) 12
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(D) 3
(36)
firms letterhead.
Signed,
D."
The
drawee
was sent.
(39)
(B) N, as indorser to O
(C) E, being the drawee
(D) D, being the drawer
(38)
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since
it
was
merely
The
authorized
alteration
of
Any agreement
(43)
goods
and
who
retains
security
(A) holder.
(B) shipper.
(C) entrustee.
(D) entrustor.
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(C) unenforceable.
(45)
(D) void.
(44)
Insurance,
Co.
his
application
for
life
insurance
company
accepted
the
that he is solvent.
(A) Yes,
since
under
the
Cognition
(D) Yes, since a bill of exchange with a
fictitious
inexistent.
(46)
drawer
is
void
and
Xs heirs.
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however,
disapproved
the
2011
since
amendment
the
of
5-year
rule
corporate
on
term
any
amendment
affecting
(48)
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to the note.
(51)
resolution
Directors.
The
of
its
Board
investment
of
grew
excellent
(50)
business
judgment.
But
and
to
Q,
again
by
note
after
"Php1"
without
O's
subject
ratification.
to
stockholders
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engaged
in
the
same
line
of
business.
generic
registration.
(54)
name
not
subject
to
it.
must be
all cases.
(A) actual.
(C) has
no
reason
to
expect
the
(B) constructive first and if it fails, then
actual.
(D) must be made to account for all his
actions.
(53)
(D) constructive.
(55)
and
circumstances.
reasonable
The
under
interest
of
the
an
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
(A) does
not
exceed
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25%
of
the
or embodied in a work.
capital stock.
any attribution to X.
not
exceed
20%
of
the
lecture
on
Association
of
his
(57)
findings
Astronomers
before
of
the
person.
the
husband's shareholdings.
(C) Yes,
since
the
rules
do
not
group.
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(B) forever.
(C) 50 years from the time the author
created his work.
(D) during the author's lifetime.
(59)
Which
expressly
of
the
warrants
following
in
indorsers
negotiating
an
subsisting
at
the
time
of
his
indorsement?
(A) The irregular indorser.
(B) The regular indorser.
(C) The general indorser.
(D) The qualified indorser.
(60)
What
is
the
basis
for
equitable
results
from
assignment
the
that
insurers
insurer.
faith.
patented invention.
(62)
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subdivided
into,
a)
forgery
of
an
by the drawee.
If
an
additional
insurance
insurance
policy
on
the
prohibits
property
hectorchristopher@yahoo.com
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the deficiency?
the
signature
of
Y,
its
client.
(66)
be
without
the
approval
of
representing
the
obligation.
it.
the deficiency.
(D) No, because X is not Zs debtor.
(68)
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lectures,
sermons,
addresses
or
The
rule
is
that
the
intentional
was
working
as
Corporate
title.
(A) Yes,
since
hospitalization
the
previous
would
influence
the
case
where
the
(73)
X,
in
the
hospital
for
kidney
Xs previous hospitalization.
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there
presentment
is
no
need
for
payment
for
and
payment
and
tax
evasion.
On
passed
board
of
directors
can
commit
corporate crimes.
(B) Yes, since it is the corporation that
did not pay the tax and it has a
unanimously
willful
(76)
to
presentment
amounted
Resolution
personality
distinct
from
its
directors.
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his product.
(78)
public transportation.
infringement. Is B correct?
has
rights
that
(79)
warehouse
of
who
then
issues
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him.
(80)
accompanied
by a Treasurer's Affidavit
(82)
purpose,
2/3
of
the
stockholders
since
there
is
substantial
dominated
Board
of
Directors.
(C) Yes, since FIMAs paid up capital
more
than
meets
nationalization laws.
the
countrys
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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(85)
(83)
(A) supervisory.
(B) No, since it is payable at a fixed
(B) absolute.
(C) discretionary.
(D) mandatory.
(84)
a specified event.
(86)
contract
on
which
the
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because
the
instrument
is
because
the
drawer
and
caught
fire
and
suffered
abandonment
through
its
agent
was
since
T,
as
agent
of
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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relayed
the
fact
of
abandonment.
(D) No, since in the first place, the
damage was more than of the
ship's value.
(90)
and
disqualified
controlled
C,
former
its
members.
objected,
however,
stockholders
holding
2/3
of
its
since
the
disqualification
and
controlled
corporations.
goods
faith.
(91)
002-38-0001
G,
grocery
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(D) W,
since
it
appears
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that
the
(94)
paid.
(92)
within
the
actual
limits
of
his
(A) Yes,
since
drawee
accepts
acceptance.
bill.
since
services
may
be
since
actually
made
(A) Yes,
as
long
as
the
indorser
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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for
the
conditional
indorsement.
(B) No, because there was no intent to
breach an implied warranty.
indorsement.
representation.
(D) Yes, whether or not the indorser
(D) No,
there
was
only
representation of intention.
indorsement.
(96)
because
(98)
of
Pesos
Seven
Thousand
Hundred
case?
(A) 10
(A) Php700,000.00.
(B) 6
(B) Php700.00.
(C) 7
(C) Php7,000.00.
(D) Php700,100.00.
(D) 5
(99)
this case?
(97)
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige
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References:
Answers
to
Bar
Examination
Questions by the UP LAW COMPLEX
UP LAW REVIEW
acceptance.
The
corporate
term
of
stock
of
Incorporation.
It
may
be
representing
the
by
at
least
2/3
of
all
stockholders.
(D) ratified by at least 2/3 of the
stockholders
representing
the
Never Let The Odds Keep You From Pursuing What You Know In Your Heart You Were Meant To Do.Leroy Satchel Paige