BAR EXAM 2007 POLITICAL LAW

POLITICAL AND PUBLIC INTERNATIONAL LAW INSTRUCTION: YOU WILL BE GIVEN CREDIT FOR YOUR KNOWLEDGE OF LEGAL DOCTRINE AND FOR THE QUALITY OF YOUR LEGAL REASONING. -I(10 POINTS) True or False. Briefly explain your answer. a. For purposes of communication and instruction! the official languages of the Philippines, until otherwise provided by law, are Filipino and English. b. The 1987 Constitution has increased the scope of academic freedom recognized under the previous Constitution. - II (10 POINTS) The City Mayor issues an Executive Order declaring that the city promotes responsible parenthood and upholds natural family planning. He prohibits all hospitals operated by the city from prescribing the use of artificial methods of contraception, including condoms, pills, intrauterine devices and surgical sterilization. As a result, poor women in his city lost their access to affordable family planning programs. Private clinics! however, continue to render family planning counsel and devices to paying clients. a. Is the Executive Order in any way constitutionally infirm? Explain. b. Is the Philippines in breach of any obligation under international law? Explain. c. May the Commission on Human Rights order the Mayor to stop the implementation of the Executive Order? Explain. - III (10 POINTS) Lawrence is a Filipino computer expert based in Manila who invented a virus that destroys all the files stored in a computer. Assume that in May 2005, this virus spread all over the world and caused $50 million in damage to property in the United States, and that in June 2005, he was criminally charged before United States courts under their anti-hacker law. Assume that in July 2005, the Philippines adopted its own anti-hacker law, to strengthen existing sanctions already provided against damage to property. The United States has requested the Philippines to extradite him to US courts under the RP-US Extradition Treaty. a. Is the Philippines under an obligation to extradite Lawrence? State the applicable rule and its rationale.

b. Assume that the extradition request was made after the Philippines adopted its anti-hacker legislation. Will that change your answer? - IV (10 POINTS) In 1993, historians confirmed that during World War II, "comfort women" were forced into serving the Japanese military. These women were either abducted or lured by false promises of jobs as cooks or waitresses, and eventually forced against their will to have sex with Japanese soldiers on a daily basis during the course of the war, and often suffered from severe beatings and venereal diseases. The Japanese government contends that the "comfort stations" were run as "onsite military brothels" (or prostitution houses) by private operators, and not by the Japanese military. There were many Filipina "comfort women." a. Name at least one basic principle or norm of international humanitarian law that was violated by the Japanese military in the treatment of the "comfort women." b. The surviving Filipina "comfort women" demand that the Japanese government apologize and pay them compensation. However, under the 1951 San Francisco Peace Agreement the legal instrument that ended the state of war between Japan and the Allied Forces -all the injured states, including the Philippines, received war reparations and, in return, waived all claims against Japan arising from the war. Is that a valid defense? c. The surviving Filipina "comfort women" sue the Japanese government for damages before Philippine courts. Will that case prosper? -V(10 POINTS) The Destilleria Felipe Segundo is famous for its 15-year old rum, which it has produced and marketed successfully for the past 70 years. Its latest commercial advertisement uses the line: "Nakalikim ka na ba ng kinse anyos?" Very soon, activist groups promoting women's and children's rights were up in arms against the advertisement. a. All advertising companies in the Philippines have formed an association, the Philippine Advertising Council, and have agreed to abide by all the ethicalguidelines and decisions by the Council. In response to the protests, the Council orders the pull-out of the "kinse anyos" advertising campaign. Can Destilleria Felipe Segundo claim that its constitutional rights are thus infringed? b. One of the militant groups, the Amazing Amazonas, call on all government-owned and controlled corporations (GOCC) to boycott any newspaper, radio or TV station that carries the "kinse anyos" advertisements. They call on all government nominees in sequestered corporations to block any advertising funds allocated for any such newspaper, radio or TV station. Can the GOCCs and sequestered corporations validly comply? - VI (10 POINTS) True or False. Briefly explain your answer. a. An amendment to the Constitution shall be valid upon a vote of three-fourths of all the Members of the Congress. b. All public officers and employees shall take an oath to uphold and defend the Constitution .

- VII (10 POINTS) Batas Pambansa 880, the Public Assembly Law of 1985, regulates the conduct of all protest rallies in the Philippines. a. Salakay, Bayan! held a protest rally and planned to march from Quezon City to Luneta in Manila. They received a permit from the Mayor of Quezon City, but not from the Mayor of Manila. They were able to march in Quezon City and up to the boundary separating it from the City of Manila. Three meters after crossing the boundary, the Manila Police stopped them for posing a danger to pubHc safety. Was this a valid exercise of police power? b. The security police of the Southern Luzon Expressway spotted a caravan of 20 vehicles, with paper banners taped on their sides and protesting graft and corruption in government. They were driving at 50 kilometers per hour in a 40-90 kilometers per hour zone. Some banners had been blown off by the wind, and posed a hazard to other motorists. They were stopped by the security police. The protesters then proceeded to march instead, sandwiched between the caravan vehicles. They were also stopped by the security force. May the security police validly stop the vehicles and the marchers? - VIII (10 POINTS) The Provincial Governor of Bataan requested the Department of Budget and Management (DBM) to release its Internal Revenue Allocation (IRA) of P100 million for the current budget year. However, the General Appropriations Act provided that the IRA may be released on Iy if the province meets certain conditions as determined by an Oversight Council created by the President. a. Is this requirement valid? b. The Provincial Governor is a party-mate of the President. May the Bataan Representative instead file a petition to compel the DBM to release the funds? - IX (10 POINTS) The Department of Education (DepEd) requires that any school applying for a tuition fee increase must, as a condition for the increase, offer full tuition scholarships to students from low-income families. The Sagrada Familia Elementary School is a Catholic school and has applied for a tuition fee increase. Under this regulation by the DepEd, it will end up giving tuition scholarships to a total of 21 students next year. At a cost of P50,OOO per student, the school will lose a total of P1.05 million for next year. a. Is this DepEd requirement valid? b. If instead the DepEd requires a full tuition scholarship for the highest ranking students in each grade, determined solely on the basis of academic grades and rank, will the DepEd requirement be valid? -X(10 POINTS) The Supreme Court has provided a formula for allocating seats for party-list representatives.

a. The twenty percent allocation - the combined number of all party-Iist congressmen shall not exceed twenty percent of the total membership of the House of Representatives, including those elected under the party list; b. The two percent threshold - only those parties garnering a minimum of two percent of the total valid votes cast for the party-list system are "qualified" to have a seat in the House of Representatives; c. The three-seat limit - each qualified party, regardless of the number of votes it actually obtained, is entitled to a maximum of three seats; that is, one "qualifying" and two additional seats; and d. The first-party rule - additional seats which a qualified party is entitled to shall be determined in relation to the total number of votes garnered by the party with the highest number of votes. For each of these rules, state the constitutional or legal basis, if any, and the purpose. NOTHING FOLLOWS.

LABOR LAW
LABOR AND SOCIAL LEGISLATION -I(5 Points) 1. a. What is the principle of codetermination? b. What, if any, is the basis under the Constitution for adopting it? - II (5 Points) 2. a. Discuss the statutory restrictions on the employment of minors? b. Maya househelp be assigned to non-household work? - III (5 Points) 3. a. Discuss the types of illegal recruitment under the Labor Code. b. In initiating actions against alleged illegal recruiters, may the Secretary of Labor and Employment issue search and arrest warrants?

- IV (5 Points) 4. Explain a. The Globe Doctrine. b. The Community of Interest Rule. -V(5 Points) May non-lawyers appear before the NLRC or Labor Arbiter? May they charge attorney's fee for such appearance provided it is charged against union funds and in an amount freely agreed upon by the parties? Discuss fully. - VI (5 Points) Procedurally, how do you stay a decision, award or order of the Labor Arbiter? Discuss fully. - VII (5 Points) 7. a. May the NLRC or the courts take jurisdictional cognizance over compromise agreements/settlements involving labor matters? b. How sacrosanct are statements/data made at conciliation proceedings in the Department of Labor and Employment? What is the philosophy behind your answer? - VIII (5 Points) Discuss in full the jurisdiction over the civil and criminal aspects of a case involving an unfair labor practice for which a charge is pending with the Department of Labor and Employment. - IX (5 Points) Discuss the legal requirements of a valid strike. -X(5 Points) Discuss briefly the instances when non-compliance by the employer with a reinstatement order of an illegally dismissed employee is allowed. - XI (5 Points)

11. a. A rule, when is retirement due? b. When is retirement due for underground miners? - XII (5 Points) 12. a. How do you execute a labor judgment which, on appeal, had become final and executory? Discuss fully. b. Cite two instances when an order of execution may be appealed. - XIII (5 Points) May a decision of the Labor Arbiter which has become final and executory be novated through a compromise agreement of the parties? - XIV (5 Points) AB, single and living-in with CD (a married man), is pregnant with her fifth child. She applied for maternity leave but her employer refused the application because she is not married. Who is right? Decide. - XV (5 Points) Some officers and rank-and-file members of the union staged an illegal strike. Their employer wants all the strikers dismissed. As the lawyer, what will you advise the employer? Discuss fully. - XVI (5 Points) A carpenter is employed by a private university in Manila. Is the carpenter a regular or a casual employee? Discuss fully. - XVII (5 Points) P.D. 1508 requires the submission of disputes before the Barangay Lupong Tagapamayapa prior to the filing of cases with the courts or other government bodies. May this decree be used to defeat a labor case filed directly with the Labor Arbiter? Discuss fully. - XVIII (5 Points) Inday was employed by mining company X to perform laundry service at its staffhouse. While attending to her assigned task, she slipped and hit her back on a stone. Unable to continue with her

work, she was permitted to go on leave for medication, but thereafter she was not allowed to return to work. She filed a complaint for illegal dismissal but her employer X contended that Inday was not a regular employee but a mere househelp. Decide. - XIX (5 Points) Cite five grounds for disciplinary action by the Philippine Overseas Employment Administration (POEA) against overseas workers. - XX (5 Points) AB, a non-resident American, seeks entry to the country to work as Vice-President of a local telecommunications company. You are with the Department of Labor and Employment (DOLE). What permit, if any, can the DOLE issue so that AB can assume as Vice-President in the telecommunications company? Discuss fully. NOTHING FOLLOWS.

TAXATION
TAXATION LAW I. (5%) What is the nature of the taxing power of the provinces, municipalities and cities? How will the local government units be able to exercise their taxing powers? II. (10%) The Local Government Code took effect on January 1, 1992. PLDT's legislative franchise was granted sometime before 1992. Its franchise provides that PLDT will only pay 3% franchise tax in lieu of all taxes. The legislative franchises of Smart and Globe Telecoms were granted in 1998. Their legislative franchises state that they will pay only 5% franchise tax in lieu of all taxes. The Province of Zamboanga del Norte passed an ordinance in 1997 that imposes a local franchise tax on all telecommunication companies operating within the province. The tax is 50% of 1% of the gross annual receipts of the preceding calendar year based on the incoming receipts, or receipts realized, within territorial jurisdiction.

Is the ordinance valid? Are PLDT, Smart and Globe liable to pay franchise taxes? Reason briefly. III. (5%) What kind of taxes, fees and charges are considered as National Internal Revenue Taxes under the National Internal Revenue Code (NIRC)? IV. (10%) XYZ Corporation, an export oriented company, was able to secure a Bureau of Internal Revenue (BIR) ruling in June 2005 that exempts from tax the importation some of its raw materials. The ruling is of first impression, which means the interpretations made by the Commissioner of Internal Revenue is one without established precedents. Subsequently, however, the BIR issued another ruling which in effect would subject to tax such kind of importation. XYZ Corporation is concerned that said ruling may have a retroactive effect, which means that all their importations done before the issuance of the second ruling could be subject to tax. a. What are BIR rulings? b. What is required to make a BIR ruling of first impression a valid one? c. Does a BIR ruling have a retroactive effect, considering the principle that tax exemptions should be interpreted strictly against the taxpayer? V. (10%) ABC Corporation sold a real property in Malolos, Bulacan to XYZ Corporation. The property has been classified as residential and with a zonal valuation of P1, 000 per square meter. The capital gains tax was paid based on the zonal value. The Revenue District Officer (RDO), however, refused to issue the Certificate Authorizing Registration for the reason that based on his ocular inspection the property should have a higher zonal valuation determined by the Commissioner of Internal Revenue because the area is already a commercial area. Accordingly, the RDO wanted to make a recomputation of the taxes due by using the fair market value appearing in a nearby bank's valuation list which is practically double the existing zonal value. The RDO also wanted to assess a donor's tax on the difference between the selling price based on the zonal value and the fair market value appearing in a nearby bank's valuation list. a. Does the RDO have the authority or discretion to unilaterally use the fair market value as the basis for determining the capital gains tax and not the zonal value as determined by the Commissioner of Internal Revenue? Reason briefly. b. Should the difference in the supposed taxable value be legally subject to donor's tax? Reason briefly. VI. (5%) Z is a Filipino immigrant living in the United States for more than 10 years. He is retired and he came back to the Philippines as a balikbayan. Every time he comes to the Philippines, he stays here for about a month. He regularly receives a pension from his former employer in the United States, amounting to US$1, 000 a month. While in the Philippines, with his pension pay from his former

employer, he purchased three condominium units in Makati which he is renting out for P15, 000 a moth each. a. Does the US$1, 000 pension become taxable because he is now residing in the Philippines? Reason briefly. b. Is his purchase of the three condominium units subject to any tax? Reason briefly. VII. (5%) Antonia Santos, 30 years old, gainfully employed, is the sister of Edgardo Santos. She died in an airplane crash. Edgardo is a lawyer and he negotiated with the airline company and insurance company and they were able to a agree total settlement of P10 Million. This is what Antonia would have earned as somebody who was gainfully employed. Edgardo was her only heir. a. Is the P10 Million subject to estate tax? Reason briefly. b. Should Edgardo report the P10 Million as his income being Antonia's only heir? Reason briefly. VIII. (5%) Nutrition Chippy Corporation gives all its employees (rank and file, supervisors and managers) one sack of rice every month valued at P800 per sack. During an audit investigation made by the Bureau of Internal Revenue (BIR), the BIR assessed the company for failure to withhold the corresponding withholding tax on the amount equivalent to the one sack of rice received by all the employees, contending that the sack of rice is considered as additional compensation for the rank and file employees and additional fringe benefit for the supervisions and managers. Therefore, the value of the one sack of rice every month should be considered as part of the compensation of the rank and file subject to tax. For the supervisors and managers, the employer should be the one assessed pursuant to Section 33 (a) of the NIRC. Is there a legal basis for the assessment made by the BIR? Explain your answer. IX. (10%) Weber Realty Company which owns a three-hectare land in Antipolo entered into a Joint Venture Agreement (JVA) with Prime Development Company for the development of said parcel of land. Weber Realty as owner of the land contributed the land to the Joint Venture and Prime Development agreed to develop the same into a residential subdivision and construct residential houses thereon. They agreed that they would divide the lots between them. a. Does the JVA entered into by and between Weber and Prime create a separate taxable entity? Explain briefly. b. Are the allocation and distribution of the saleable lots to Weber and prime subject to income tax and to expanded withholding tax? Explain briefly. c. Is the sale by Weber or Prime of their respective shares in the saleable lots to third parties subject to income tax and to expanded withholding tax? Explain briefly. X. (10%)

Noel Santos is a very bright computer science graduate. He was hired by Hewlett Packard. To entice him to accept the offer for employment, he was offered the arrangement that part of is compensation would be an insurance policy with a face value of P20 Million. The parents of Noel are made the beneficiaries of the insurance policy. a. Will the proceeds of the insurance form part of the income of the parents of Noel and be subject to income tax? Reason briefly. b. Can the company deduct from its gross income the amount of the premium? Briefly. XI. (5%) The Congregation of the Mary Immaculate donated a land a dormitory building located along Espaa St. in favor of the Sisters of the Holy Cross, a group of nuns operating a free clinic and high school teaching basic spiritual values. Is the donation subject to donor's tax? Reason Briefly. XII. (5%) Remedios, a resident citizen, died on November 10, 2006. She died leaving three condominium units in Quezon City valued at P5 Million each. Rodolfo was her only heir. He reported her death on December 5, 2006 and filed the estate tax, he asked the Commissioner of Internal Revenue to give him one year to pay the estate tax due. The Commissioner approved the request for extension of time provided that the estate tax be computed on the basis of the value of the property at the time of payment of the tax. a. Does the Commissioner of Internal Revenue have the power to extend the payment of estate tax? If so, what are the requirements to allow such extension? b. Does the condition that the basis of the estate tax will be the value at the time of the payment have legal basis? Reason briefly. XIII. (5%) ABC Corporation won a tax refund case for P50 Million. Upon execution of the judgement and when trying to get the tax Credit Certificates (TCC) representing the refund, the Bureau of Internal Revenue (BIR) refused to issue the TCC on the basis of the fact that the corporation is under audit by the BIR and it has a potential tax liability. Is there a valid justification for the BIR to withhold the issuance of the TCC? Explain your answer briefly. NOTHING FOLLOWS.

CIVIL LAW
CIVIL LAW

I Distinguish the following concepts: a. Occupation v. possession. (5%) b. Illegal and impossible conditions in a simple donation v. illegal and impossible conditions in an onerous donation. (5%) II (10%) Manila Petroleum Co. owned and operated a petroleum operation facility off the coast of Manila. The facility was located on a floating platform made of wood and metal, upon which was permanently attached the heavy equipment for the petroleum operations and living quarters of the crew. The floating platform likewise contained a garden area, where trees, plants and flowers were planted. The platform was tethered to a ship, the MV 101, which was anchored to the seabed. a. Is the platform movable or immovable property? b. Are the equipment and living quarters movable or immovable property? c. Are the trees, plants and flowers immovable or movable property? Please briefly give the reason for your answers. III. Explain the following concepts and doctrines and give an example of each: a. concept of trust de son tort (constructive trust) (5%) b. doctrine of discovered peril (last clear chance) (5%) IV. (10%) Bedrock Land & Property Development Corp. is a development company engaged in developing and selling subdivisions, condominium units and industrial estates. In order to replenish its inventories, it embarked on an aggressive land banking program. It employed "scouts" who roam all over the Philippines to look for and conduct investigations on prospective sites for acquisition and development, whether developed, semi-developed or raw land. The management of Bedrock asks you as the company counsel to prepare a manual containing a summary of the pertinent laws and regulations relating to land registration and acquisition of title to land. The manual should include the following items: a. What is the governing law? b. What properties are not registrable? Supply this information. V. (10%)

What are obligations without an agreement"? Give five examples of situations giving rise to this type of obligations? VI. (10%) Clara, thinking of her mortality, drafted a will and asked Roberta, Hannah, Luisa and Benjamin to be witnesses. During the day of signing of her will, Clara fell down the stairs and broke her arms. Coming from the hospital, Clara insisted on signing her will by thumb mark and said that she can sign her full name later. While the will was being signed, Roberta experienced a stomach ache and kept going to the restroom for long periods of time. Hannah, while waiting for her turn to sign the will, was reading the 7th Harry Potter book on the couch, beside the table on which everyone was signing. Benjamin, aside from witnessing the will, also offered to notarize it. A week after, Clara was run over by a drunk driver while crossing the street in Greenbelt. May the will of Clara be admitted to probate? Give your reasons briefly. VII. Write "TRUE" if the statement is true or "FALSE" if the statement is false. If the statement is FALSE, state the reason. (2% each). 1. Roberta, a Filipino, 17 years of age, without the knowledge of his parents, can acquire a house in Australia because Australian Laws allow aliens to acquire property from the age of 16. 2. If a man commits several acts of sexual infidelity, particularly in 2002, 2003, 2004, 2005, the prescriptive period to file for legal separation runs from 2002. 3. An individual, While single, purchases a house and lot in 1990 and borrows money in 1992 to repair it. In 1995, such individual gets married while the debt is still being paid. After the marriage, the debt is still the responsibility of such individual. 4. The day after John and Marsha got married, John told her that he was impotent. Marsha continued to live with John for 2 years. Marsha is now estopped from filing an annulment case against John. 5. Amor gave birth to Thelma when she was 15 years old. Thereafter, Amor met David and they got married when she was 20 years old. David had a son, Julian, with his ex-girlfriend Sandra. Julian and Thelma can get married. VIII. (10%) In 1986, Jennifer and Brad were madly in love. In 1989, because a certain Picasso painting reminded Brad of her, Jennifer acquired it and placed it in his bedroom. In 1990, Brad and Jennifer broke up. While Brad was mending his broken heart, he met Angie and fell in love. Because the Picasso painting reminded Angie of him, Brad in his will bequeathed the painting to Angie. Brad died in 1995. Saddened by Brad's death, Jennifer asked for the Picasso painting as a remembrance of him. Angie refused and claimed that Brad, in his will, bequeathed the painting to her. Is Angie correct? Why or why not? IX Multiple choice: Choose the right answer. (2% each)

1. The parties to a bailment are the: a. bailor; b. bailee; c. comodatario; d. all the above; e. letters a and b 2. A deposit made in compliance with a legal obligation is: a. an extrajudicial deposit; b. a voluntary deposit; c. a necessary deposit; d. a deposit with a warehouseman; e. letters a and b 3. A contract of antichresis is always: a. a written contract; b. a contract, with a stipulation that the debt will be paid through receipt of the fruits of an immovable; c. Involves the payment of interests, if owing; d. All of the above; e. Letters a and b 4. An, assignee in a proceeding under the Insolvency Law does not have the duty of: a. suing to recover the properties of the state of the insolvent debtor; b. selling property of the insolvent debtor; c. ensuring that a debtor corporation operate the business efficiently and effectively while the proceedings are pending; d. collecting and discharging debts owed to the insolvent debtor. 5. In order to obtain approval of the proposed settlement of the debtor in an insolvency proceeding. a. the court must initiate the proposal b. 2/3 of the number of creditors should agree to the settlement; c. 3/5 of the number of creditors should agree to the settlement; d. 1/3 of the total debts must be represented by the approving creditors; e. Letters a and b X (10%) For purpose of this question, assume all formalities and procedural requirements have been complied with. In 1970, Ramon and Dessa got married. Prior to their marriage, Ramon had a child, Anna. In 1971 and 1972, Ramon and Dessa legally adopted Cherry and Michelle respectively. In 1973, Dessa died while giving birth to Larry Anna had a child, Lia. Anna never married. Cherry, on the other hand, legally adopted Shelly. Larry had twins, Hans and Gretel, with his girlfriend, Fiona. In 2005, Anna, Larry and Cherry died in a car accident. In 2007, Ramon died. Who may inherit from Ramon and who may not? Give your reason brieftly; NOTHING FOLLOWS.

MERCANTILE LAW
MERCANTILE LAW I. (10%) R issued a check for P1M which he used to pay S for killing his political enemy. a. Can the check be considered a negotiable instrument? b. Does S. have a cause of action against R in case of dishonor by the drawee bank? c. If S negotiated the check to T, who accepted it in good faith and for value, may R be held secondarily liable by T? Reason briefly in (a), (b) and (c). II. (10%) Alex deposited goods for which Billy, warehouseman, issued a negotiable warehouse receipt wherein the goods were deliverable to Alex or order. Alex negotiated the receipt to Caloy. Thereafter, Dario, a creditor secured judgment against Alex and served notice of levy over the goods on the warehouseman. a. To whom should the warehouseman deliver the goods upon demand? b. Would you answer be the same if the warehouseman issued a non-negotiable warehouse receipt III. (5%) Diana and Piolo are famous personalities in showbusiness who kept their love affair secret. They use a special instant messaging service which allows them to see one another's typing on their own screen as each letter key is pressed. When Greg, the controller of the service facility, found out their identities, he kept a copy of all the messages Diana and Piolo sent each other and published them. Is Greg liable for copyright infringement? Reason briefly. IV. (10%) Alfredo took out a policy to insure his commercial building against fire. The broker for the insurance company agreed to give a 15-day credit within which to pay the insurance premium. Upon delivery of the policy on May 15, 2006, Alfredo issued a postdated check payable on May 30, 2006. On May 28, 2006, a fire broke out and destroyed the building owned by Alfredo. a. May Alfredo recover on the insurance policy? b. Would your answer in (a) be the same if it was found that the proximate cause of the fire was an explosion and that fire was but the immediate cause of loss and there is no excepted peril under the policy?

c. If the fire was found to have been caused by Alfredo's own negligence, can he still recover on the policy? Reason briefly in (a), (b) and (c). V. (5%) C contracted D to renovate his commercial building. D ordered construction materials from E and received delivery thereof. The following day, C went to F Bank to apply for a loan to pay the construction materials. As security for the loan, C was made to execute a trust receipt. One year later, after C failed to pay the balance on the loan, F Bank charged him with violation of the Trust Receipts Law. a. What is a Trust Receipt? b. Will the case against C prosper? Reason briefly. VI. (5%) Discuss the trust fund doctrine VII. (10%) In a stockholder's meeting, S dissented from the corporate act converting preferred voting shares to non-voting shares. Thereafter, S submitted his certificates of stock for notation that his shares are dissenting. The next day, S transferred his shares to T to whom new certificates were issued. Now, T demands from the corporation the payment of the value of his shares. a. What is the meaning of a stockholder's appraisal right? b. Can T exercise the right of appraisal? Reason briefly. VIII. (10%) Due to growing financial difficulties, Z Bank was unable to finish construction of its 21-storey building on a prime lot located in Makati City. Inevitably, the Bangko Sentral ordered the closure of Z Bank and consequently placed it under receivership. In a bid to save the bank's property investment, the President of Z Bank entered into a financing agreement with a group of investors for the completion of the construction of the 21-storey building in exchange for a ten year lease and the exclusive option to purchase the building. a. Is the act of the President valid? Why or why not? b. Will a suit to enforce the exclusive right of the investors to purchase the property prosper? Reason briefly. IX. (5%)

On December 4, 2003, RED Corporation executed a real estate mortgage in favor of BLUE Bank. RED Corporation defaulted in the payment of its loan. Consequently, on June 4, 2004, BLUE Bank extrajudicially foreclosed the property. Being the highest bidder in the auction sale conducted, the Bank was issued a Certificate of Sale which was registered on August 4, 2004. Does RED Corporation still have the right to redeem the property as of September 14, 2007? Reason briefly. X. (5%) Name at least five (5) predicate crimes to money laundering. XI. (10%) Two vessels figured in a collision along the Straits of Guimaras resulting in considerable loss of cargo. The damaged vessels were safely conducted to the Port of Iloilo. Passenger A failed to file a maritime protest. B. a non-passenger but a shipper who suffered damage to his cargo, likewise did not file a maritime protest at all. a. What is a maritime protest? b. Can A and B successfully maintain an action to recover losses and damages arising from the collision? Reason briefly. XII. (5%) Seeking to streamline its operations and to bail out its losing ventures, the stockholders of X Corporation unanimously adopted a proposal to sell substantially all of the machineries and equipment used in and out its manufacturing business and to sink the proceeds of the sale for the expansion of its cargo transport services. a. Would the transaction be covered by the provisions of the Bulk Sales Law? b. How would X Corporation effect a valid sale? XIII. (10%) a. What are the preferred claims that shall be satisfied first from the assets of an insolvent corporation? b. How shall the remaining non-preferred creditors share in the estate of the insolvent corporation above? NOTHING FOLLOWS.

CRIMINAL LAW
CRIMINAL LAW I. (10%) What are the penalties that may be served simultaneously? II. (10%) Tiburcio asked Anastacio to join their group for a "session". Thinking that it was for a mahjong session, Anastacio agreed. Upon reaching Tiburcios house, Anastacio discovered that it was actually a shabu session. At that precise time, the place was raided by the police, and Anastacio was among those arrested. What crime can Anastacio be charged with, if any? Explain your answer. III. (10%) Jervis and Marlon asked their friend, Jonathan, to help them rob a bank. Jervis and Marlon went inside the bank, but were unable to get any money from the vault because the same was protected by a time-delay mechanism. They contented themselves with the customers cellphones and a total of P5,000 in cash. After they dashed out of the bank and rushed into the car, Jonathan pulled the car out of the curb, hitting a pedestrian which resulted in the latters death. What crime or crimes did Jervis, Marlon and Jonathan commit? Explain your answer. IV. (10%) Macky, a security guard, arrived home late one night after rendering overtime. He was shocked to see Joy, his wife, and Ken, his best friend, in the act of having sexual intercourse. Macky pulled out his service gun and shot and killed Ken. The court found that Ken died under exceptional circumtances and exonerated Macky of murder but sentenced him to destierro, conformably with Article 247 of the Revised Penal Code. The court also ordered Macky to pay indemnity to the heirs of the victim in the amount of P50,000. a. Did the court correctly order Macky to pay indemnity even though he was exonerated of murder? Explain your answer. b. While serving his sentenced, Macky entered the prohibited area and had a pot session with Ivy (Joys sister). Is Macky entitled to an indeterminate sentence in case he is found guilty of the use of prohibited substances? Explain your answer. V. (10%)

a. Distinguish between an accomplice and a conspirator. b. What are the three (3) classes of offender in the crime of qualified seduction? Give an example of each. VI. (10%) What are the different acts of inciting to sedition? VII. (10%) Eddie brought his son Randy to a local faithhealer known as "Mother Himala." He was diagnosed by the faithhealer as being possessed by an evil spirit. Eddie thereupon authorized the conduct of a "treatment" calculated to drive the spirit from the boys body. Unfortunately, the procedure conducted resulted in the boys death. The faithhealer and tree others who were part of the healing ritual were charged with murder and convicted by the lower court. If you are appellate court Justice, would you sustain the conviction upon appeal? Explain your answer. VIII (10%) Fe is the manager of a rice mill in Bulacan. In order to support a gambling debt, Fe made it appear that the rice mill was earning less than it actually was by writing in a "talaan" or ledger a figure lower than what was collected and paid by their customers. Fe then pocketed the difference. What crime/s did Fe commit, If any? Explain your answer. IX. (10%) During a concert of Gary V. and in order to prevent the crowd from rushing to the stage, Rafael Padilla {a security guard} pointed his gun at the onrush of people. When the crowd still pushed forward, Rafael fired his gun into air to scare them off. However, the bullet hit one of the metal roof supports, ricocheted and then hit one of the stage crew members, causing injuries which resulted in the latters confinement in a hospital for twelve days. What crime/s did Rafael commit? Explain your answer. X. (10%) Pinky was a lessee of a market stall owned by Giovanni. When Pinky refused to pay her rental, Giovanni nailed some wooden barricades on one of the sides of the market stall and posted this warning: "We have closed this portion of the door. Do not open it or else something may happen to you." What crime/s did Giovanni commit, if any? Explain your answer. NOTHING FOLLOWS.

REMEDIAL LAW
REMEDIAL LAW -I(Total 10%) a. What are the rules on the recognition and enforcement of foreign judgments in our courts? (6%) b. Can a foreign arbitral award be enforced in the Philippines under those rules? Explain briefly. (2%) c. How about a global injunction issued by a foreign court to prevent dissipation of funds against a defendant therein who has assets in the Philippines? Explain briefly. (2%) - II (Total 10%) True or False. If the answer is false, explain your answer briefly. a. The surviving parties rule bars Maria from testifying for the claimant as to what the deceased Jose had said to her, in a claim filed by Pedro against the estate of Jose (3%) b. A defendant who has been declared in default can avail of a petition for relief from the judgment subsequently rendered in the case. (3%) c. A motion is pleading. (2%) d. A counterclaim is pleading. (2%) - III (Total 10%) 1. What is the hearsay rule? (5%) 2. In relation to the hearsay rule, what do the following rules of evidence have in common? (5%) 1. The rule on statements that are part of the res gestae; 2. The rule on dying declarations; 3. The rule on admissions against interest. - IV (10%) Husband H files a petition for declaration of nullity of marriage before the RTC of Pasig City. Wife W files a petition for habeas corpus before the RTC of Pasay City, praying for custody over their minor child. H files a motion to dismiss the wife's petition on the ground of the pendency of the other case. Rule. -V(Total 10%) a. Distinguish the effects of the filling of a demurrer to the evidence in a criminal case and its filing in a civil case. (5%)

b. What is reverse trial and when may it be resorted to? Explain briefly. (5%) - VI (Total 10%) a. On his way home, a member of the Caloocan City police force witnesses a bus robbery in Pasay City and effects the arrest of the suspect. Can he bring the suspect to Caloocan City for booking since that is where his station is? Explain briefly. (5%) b. In the course of serving a search warrant, the police finds an unlicensed firearm. Can the police take the firearm even if it is not covered by the search warrant? If the warrant is subsequently quashed, is the police required to return the firearm? Explain briefly. (5%) - VII (Total 10%) a. B files a petition for cancellation of the birth certificate of her daughter R on the ground of falsified material entries there in made by B's husband as the informant. The RTC sets the case for hearing and directs the publications of the order once a week for three consecutive weeks in a newspaper of general circulation. Summons was served on the Civil Registrar but there was no appearance during the hearing. The RTC granted the petition. R filed a petition for annulment of judgment before the Court of Appeals, saying that she was not notified of the petition and hence, the decision was issued in violation of due process. B opposed saying that the publication of the court order was sufficient compliance with due process. Rule. (5%) b. G files a complaint for recovery of possession and damage against F. in the course of the trial, G marked his evidence but his counsel failed to file a formal offer of evidence. F then presented in evidence tax declarations in the name of his father to establish that his father is a co-owner of the property. The court ruled in favor of F, saying that G failed to prove sole ownership of the property in the face of F's evidence. Was the court correct? Explain briefly. (5%) - VIII (Total 10%) a. X files an unlawful detainer case against Y before the appropriate Metropolitan Trial Court. In his answer, Y avers as a special and affirmative defense that he is a tenant of X's deceased father in whose name the property remains registered. What should the court do? Explain briefly. (5%) b. The heirs of H agree among themselves that they will honor the division of H's estate as indicated in her Last Will and Testament. To avoid the expense of going to court in a Petition for Probate of the Will, can they instead execute an Extrajudicial Settlement Agreement among themselves? Explain briefly. (5%) - IX (10%) L was charged with illegal possession of shabu before the RTC. Although bail was allowable under his indictment, he could not afford to post bail, and so he remained in detention at the City Jail. For various reasons ranging from the promotion of the Presiding Judge, to the absence of the trial prosecutor, and to the lack of the notice to the City Jail Warden, the arraignment of L was postponed nineteen times over a period of two years. Twice during that period, L's counsel filed motions to

dismiss, invoking the right of the accused to a speedy trial. Both motions were denied by the RTC. Can L file a petition for mandamus? Reason briefly. -X(Total 10%) a. RC filed a complaint for annulment of the foreclosure sale against Bank V. in its answer, Bank V set up a counter claim for actual damages and litigation expenses. RC filed a motion to dismiss the counterclaim on the ground the Bank V's Answer with Counterclaim was not accompanied by a certification against forum shopping. Rule. (5%) b. A files a case against B. While awaiting decision on the case, A goes to the United States to work. Upon her return to the Philippines, seven years later, A discovers that a decision was rendered by the court in her favor a few months after she had left. Can a file a motion for execution of the judgment? Explain briefly. (5%) NOTHING FOLLOWS.

LEGAL ETHICS
LEGAL ETHICS AND PRACTICAL EXERCISES -I(10%) What are the duties of an attorney? - II (10%) C engages the services of attorney D concerning various mortgage contracts entered into by her husband from whom she is separated, fearful that her real estate properties will be foreclosed and of impending suits for sums of money against her. Attorney D advised C to give him her land titles covering her lots so he could sell them to enable her to pay her creditors. He then persuaded her execute deeds of sale in his favor without any monetary or valuable consideration, to which C agreed on condition that he would sell the lots and from the proceeds pay her creditors. Later on, C came to know that attorney D did not sell her lots but instead paid her creditors with his own funds and had her land titltes registered in his name. Did attorney D violate the Code of Professional Responsibility? Explain. - III (10%) Attorney M. accepted a civil case for the recovery of title and possession of land in behalf of N. Subsequently, after the Regional Trial Court had issued a decision adverse to N, the latter filed an

administrative case against attorney M for disbarment. He alleged that attorney M caused the advese ruling against him; that attorney M did not file an opposition to the Demurrer to Evidence filed in the case, neither did he appear at the formal hearing on the demurrer, leading the trial court to assume that plaintiff's counsel (attorney M) appeared convinced of the validity of the demurer filed; that attorney M did not even file a motion for reconsideration , causing the order to become final and executory; and that even prior to the above events and in view of attorney M's apparent loss of interest in the case, he verbally requested attorney M to withdraw, but attorney M refused. Complainant N further alleged that attorney M abused his client's trust and confidence and violated his oath of office in failing to defend his client's cause to the very end. Attorney M replied that N did not give him his full cooperation; that the voluminous records turned over to him were in disarray, and that appeared for N, he had only half of the information and background of the case; that he was assured by N's friends that they had approach the judge; that they requested him (M) to prepare a motion for reconsideration which he did and gave to them; however these friends did not return the copy of the motion. Will the administrative case proper? Give reasons for your answer. - IV (10%) When is recovery of attorney's fees based on quantum meruit allowed? -V(10%) During the hearing of an election protest filed by his brother, Judge E sat in the area reserved for the public, not beside his brother's lawyer. Judge E's brother won the election protest. Y, the defeated candidate for mayor, filed an administrative case against Judge E for employing influence and pressure on the judge who heard and decided the election protest. Judge E explained that the main reasons why he was there in the courtroom were because he wanted to observe how election protest are conducted as he has never conducted one and because he wanted to give moral support to his brother. Did Judge E commit an act of impropriety as a member of the judiciary? Explain? - VI (Total 10%) a. A and B are accused of Estafa by C, the wife of Regional Trial Court Judge D. Judge D testified as a witness for the prosecution in the Estafa case. Did Judge D commit an act of impropriety? Give reasons for your answer. (5%) b. What qualities should an ideal judge possess under the New Code of Judicial Conduct for the Philippine Judiciary? (5%) - VII (Total 10%)

a. What evidence of identity does the 2004 Rules on Notarial Practice require before a notary public can officially affix his notarial seal on and sign a document presented by an individual whom the notary public does not personally know? (5%) b. When can Judges of the Municipal Trial Courts (MTC) and Municipal Circuit Trial Courts (MCTC) perform the function of notaries public ex officio, even if the notarization of the documents are not in connection with the exercise of their official function and duties? (5%) - VIII (10%) Prepare a clause stipulating a right of first refusal to be embodied in a contract of lease, in case of sale of the property leased. - IX (10%) Prepare an affidavit of merits to be attached to a Petition for Relief. -X(10%) Prepare an arbitration clause to be included in a contract. NOTHING FOLLOWS.