Commercial Law 2013

8/12/2019 Commercial Law 2013

1/14

ESSAY

1. This Questionnaire contains FIFTEEN (15) pages including these instructions pages. Checkthe number o pages and the page numbers at the upper right hand corner o each page o thisQuestionnaire and make sure it has the correct number o pages and their proper numbers.

There are TEN (1!) Essa" Questions numbered I to #$ and FIFTEEN (15) %ultiple ChoiceQuestions (%CQs) numbered I to #&$ to be ans'ered 'ithin four (4) hours .

The essa" portion contains uestions that are 'orth !* o the 'hole e+amination$ 'hile the%CQ portion contains uestions 'orth ,!*.

2. -ead each uestion er" care ull" and 'rite "our ans'ers in "our /ar E+amination Notebookin the same order the questions are posed . 0rite "our ans'ers onl" on the ront$ not the back$

page o e er" sheet in "our E+amination Notebook. Note 'ell the allocated percentage points roeach number$ uestion$ or sub uestion. In "our ans'ers$ use the numbering s"stem in the

uestionnaire.

I the sheets pro ided in "our E+amination Notebook are not su icient or "our ans'ers$ use the back pages o e er" sheet o "our E+amination Notebook$ starting at the back page o the irstsheet and the back o the succeeding sheets therea ter.

3. 2ns'er the Essa" uestions legibly, clearly, and concisely . 3tart each number on a separate page. 2n ans'er to a sub uestion under the same number ma" be 'ritten continuousl" on thesame page and the immediate succeeding pages until completed.

4our ans'er should demonstrate "our abilit" to anal" e the acts presented b" the uestion$ toselect the material rom the immaterial acts$ and to discern the points upon 'hich the uestionturns. It should sho' "our kno'ledge and understanding o the pertinent principles and theorieso la' in ol ed and their uali ications and limitations. It should demonstrate "our abilit" toappl" the la' to the gi en acts$ and to reason logicall" in a la'"er like manner to a soundconclusion rom the gi en premises.

2 mere 64es7 or 6No7 ans'er 'ithin an" corresponding e+planation or discussion 'ill not begi en an" credit. Thus$ al'a"s briefly but ull e+plain "our ans'ers although the uestion doesnot e+pressl" ask or an e+planation. 2t the same time$ remember that a complete e+planationdoes not re uire that "ou olunteer in ormation or discuss legal doctrines that are not necessar"or pertinent to the solution to the problems. 4ou do not need to re 'rite or repeat teh uestion in"our E+amination Notebook.

4. %CQs are to be ans'ered b" 'riting in "our E+amination Notebook the capital letter (2$ /$C$ 8$ or E) corresponding to "our chosen ans'er. The MCQ answers should begin in the page

following the last page of your essay answers .


2/14

There is onl" one correct ans'er to e er" %CQ9 choose the /E3T ans'er rom amount theo ered choices. Note that some %CQs ma" need care ul anal"sis both o the uestions and thechoices o ered.

5. %ake sure "ou do not 'rite your name or an" extraneous note s or distincti!e mar"ing s on

"our E+amination Notebook that can ser e as an identi "ing mark:s (such as names that are notin the gi en uestions$ pra"ers$ or pri ate notes to the E+aminer).

0riting$ lea ing or making an" distinguishing or identi "ing mark in the E+amination Notebookis considered cheating and can dis uali " "ou or the /ar e+aminations.

4ou can use the uestionnaire or notes "ou ma" 'ish:need to 'rite during the e+amination.

;2N8 IN 4


3/14

I,.

-ud" is a ine arts student in a uni ersit". ;e sta"s in a boarding house 'ith /ernie as hisroommate. 8uring his ree time$ -ud" 'ould paint and lea e his inished 'orks l"ing around the

boarding house.


4/14

0hen the e+tended loan period e+pired 'ithout an" signi icant pa"ment rom 8elano (not e ento the e+tent o the proceeds o the sale o the iron pellets)$ /8? /ank consulted "ou on ho' to

proceed against 8elano. The bank is contemplating the iling o esta a pursuant to the pro isionso ?res. 8ecree No. 115 (Trust -eceipts a') to orce 8elano to turn in at least the proceeds othe sale o the iron pellets.

Wou! you& as *an+ counse! an as an o""icer o" the court& a )ise the *an+ to procee 'ithits contemp!ate action? (8%

,II.

3table Insurance Co. (3IC) and 3t. ?eter %anu acturing Co. (3?%C) ha e had a long standinginsurance relationship 'ith each other9 3?%C secures the comprehensi e ire insurance on its

plant and acilities rom 3IC. The standing business practice bet'een them has been to allo'3?%C a credit period o K! da"s rom the rene'al o the polic" 'ithin 'hich to pa" the

premium.

3oon a ter the ne' polic" 'as issued and be ore premium pa"ments could be made$ a ire guttedthe co ered plant and acilities to the ground. The da" a ter the ire$ 3?%C issued a managerAscheck to 3IC or the ire insurance premium$ or 'hich it 'as issued a receipt9 a 'eek later3?%C issued its notice o loss.

3IC responded b" issuing its o'n managerAs check or the amount o the premiums 3?%C had paid$ and denied 3?%CAs claim on the ground that under the 6cash and carr"7 principlego erning ire insurance$ no co erage e+isted at the time the ire occurred because the insurance

premium had not been paid.

Is S /0 entit!e to reco)er "or the !oss "rom SI0? (8%

,III.

In the No ember ,!1! stockholders meeting o Lreen ille Corporation$ eight ( ) directors 'ereelected to the board. The directors assumed their posts in Hanuar" ,!11. 3ince no stockholdersAmeeting 'as held in No ember ,!11$ the eight directors ser ed in a holdo er capacit" and thuscontinued discharging their po'ers.

In Hune ,!1,$ t'o (,) o Lreen ille CorporationAs directors G 8irector 2 and 8irector / Gresigned rom the board. -el"ing on 3ection ,K o the Corporation Code$ the remaining si+ (@)

directors elected t'o (,) ne' directors to ill in the acanc" caused b" the resignation o8irectors 2 and /.

3tockholder # uestioned the election o the ne' directors$ initiall"$ through a letter complaintaddressed to the board$ and later ('hen his letter complaint 'ent unheeded)$ through a deri ati esuit iled 'ith the court. ;e claimed that the acanc" in the board should be illed up b" the oteo the stockholders o Lreen ille Corporation. Lreen ille CorporationAs directors de ended thelegalit" o their action$ claiming as 'ell that 3tockholder #As deri ati e suit 'as improper.


5/14

u!e on the issues raise . (8%

I .

Fil 2sia 2ir Flight K1@ 'as on a scheduled passenger light rom %anila 'hen it crashed as it

landed at the Caga"an de


6/14

I.

Claude$ the registered stockholder o 1$!!! shares in 2/C Corp.$ pledged the shares to Conrad b" endorsement in blank o the co ering stock certi icates and$ e+ecution o a 8eed o2ssignment o 3hares o 3tock$ intended as collateral or a loan o ?1.! %illion that 'as also

supported b" a separate promissor" note.

I.(1 n er these "acts& is there a )a!i p!e -e o" the shares o" stoc+ to 0onra ? (1%

(2) No$ because shares o stock are intangible personal properties 'hose possession cannot bedeli ered and$ hence$ cannot be the subDect o a pledge.

(/) No$ because the pledge o shares o stock re uires double registration 'ith the -egister o8eeds o the principal place o business o the corporation and o the residence o the pledgor.

(C) 4es$ because endorsement and deli er" o the certi icates o stock is e ui alent to thetrans er o possession o the co ered shares to the pledgee.

(8) 4es$ because the e+ecution o the 8eed o 2ssignment o 3hares o 3tock is e ui alent to ala' ul pledge o the shares o stock.

I.(,) 2 ter Claude de aulted on the loan$ Conrad sought to ha e the shares registered in his namein the books o the corporation. I" you are the 0orporate Secretary o" A#0 0orporation&'ou! you re-ister the shares in the name o" 0onra 'ithout any 'ritten instruction "rom0!au e? (1%

(2) 4es$ since the endorsement and deli er" o the certi icates o stock e+ecuted b" Claudeconstitute the legal authorit" to cancel the shares in his name and to place them in ConradAsname.

(/) 4es$ since the e+ecution o the 8eed o 2ssignment b" Claude 'ould constitute the legalauthorit" to cancel the shares in his name and place them in ConradAs name.

(C) No$ because corporate o icers can onl" take direct instructions rom the registered o'nerson the proper disposition o shares registered in their names.

(8) No$ because the corporation has a primar" lien on the shares co ering the unpaid

subscription.

II.

2 oreign delegation o businessmen and in estment bankers called on "ourla' irm to discussthe possibilities o in esting in arious proDects in the ?hilippines$ and 'anted "our thoughts oncertain issues regarding oreign in estments in the ?hilippines.


7/14

II.(1 The delegation has been told about the Foreign In estments 2ct o 1KK1$ as amended (FI2AK1)$ and the" asked 'hat e+actl" is the la'As essential thrust regarding oreign in estments in?hilippine business and industries.

You rep!ie that 6IA 791 essentia!!y re"!ects :::::::. (1%

(2) the 6Filipino First ?olic"7

(/) the 6Foreign In estments ?ositi e ists7 concept

(C) the 6Foreign In estments Negati e ists7 concept

(8) the 6Control Test7 concept

(E) 2ll o the abo e.

II.(2 The delegation asked aside rom Filipino ctt1 ens$ 'hat entities 'ould all under thede inition o 6?hilippine National7 under FI2 AK1

You rep!ie that the e"inition o" ; hi!ippine nationa!< un er 6IA 791 co)ers :::::::.(1%

(2) domestic partnerships 'holl" composed o Filipino citi ens

(/) domestic corporations @!* o 'hose capital stock$ outstanding and entitled to ote$ areo'ned and held b" Filipino citi ens

(C) oreign corporations considered as doing business in the ?hilippines under the CorporationCode$ 1!!* o 'hose capital stock$ outstanding and entitled to ote$ are 'holl" o'ned b"Filipino citi ens

(8) 2ll o the abo e$ because the la' considers the Duridical personalit"$ 'hether domestic ororeign$ as a mere medium9 the test o nationalit" is on the indi iduals 'ho control the medium

(E) None o the abo e$ because the term ?hilippine national can onl"co er indi iduals and not Duridical entities.

II.(3 The delegation heard that oreigners can in est up to 1!!* o the e uit" in 6e+port

oriented enterprises7 and "ou 'ere asked e+actl" 'hat the term co ers. You rep!ie that an;e port oriente enterprise< un er 6IA 791 is an enterprise that :::::::. (1%

(2) onl" engages in the e+port o goods and ser ices$ and does not sell goods or ser ices to thedomestic market

(/) e+ports consistentl" at least !* o its goods or ser ices$ and sells at least@!* o the rest to the domestic market


8/14

(C) e+ports consistentl" at least @!* o the goods or ser ices produced$ and sells at least !* othe rest to the domestic market

(8) e+ports consistentl" at least @!* o its goods or ser ices produced$ and can sell goods orser ices to the domestic market

(E) None o the abo e.

III.

8ennis subscribed to 1!$!!! shares o #4M Corporation 'ith a par alue o ?1!! per share.;o'e er$ he paid onl" ,5* o the subscription or ?,5!$!!!.!!. No call has been made on theunpaid subscription.

o' many shares is $ennis entit!e to )ote at the annua! meetin- o" the stoc+ho! ers o"Y=? (1%

(2) 1!$!!! shares

(/) ,$5!! shares

(C) 1!! shares

(8) ! shares


I,.

2/C Corp. issued redeemable shares. =nder the terms o the issuance$ thes hares shall beredeemed at the end o 1! "ears rom date o issuance$ at par alue plus a premiumo 1!*.

0hoose the correct statement re!atin- to these re eema*!e shares. (1%

(2) 2/C Corp. 'ould need unrestricted retained earnings to be able to redeem the shares.

(/) Corporations are not allo'ed to issue redeemable shares9 thus$ the issuance b" 2/C Corp. is

ultra ires.

(C) ;olders o redeemable shares enDo" a pre erence o er creditors.

(8) 2/C Corp. ma" redeem the shares at the end o 1! "ears 'ithout need or unrestrictedretained earnings pro ided that$ a ter the redemption$ there are su icient assets to co er its debts.

(E) 2ll o the abo e are incorrect.


9/14

,.

2rnold$ representing himsel as an agent o /rian or the sale o /rianAs car$ approached 8ennis'ho appeared interested in bu"ing the car. 2t 2rnoldAs prodding$ 8ennis issued a crossed check

pa"able to /rian or ?,5$!!!.!! on the understanding that the check 'ould onl" be sho'n to

/rian as e idence o 8ennisA good aith and interest in bu"ing the car. Instead$ 2rnold used thecheck to pa" or the medical e+penses o his 'i e in /rianAs clinic a ter /rian$ a doctor$ treatedher.

Is #rian a ho! er in ue course ( I$0 ? (1%

(2) 4es$ /rian is a ;I8C because he 'as the pa"ee o the check and he recei ed it or ser icesrendered.

(/) 4es$ /rian is a ;I8C because he did not need to go behind the check that 'as pa"able tohim.

(C) No$ /rian is not a ;I8C because 8ennis issued the check onl" as e idence o good aith andinterest in bu"ing the car.

(8) No$ /rian is not a ;I8C because /rian should ha e been placed on notice the check 'ascrossed in his a or and 2rnold 'as not the dra'er.

(E) No$ /rian is not a ;I8C because the re uisite consideration to 8ennis 'as not present.

,I.

La'sengsit Corp. is a corporation incorporated in 3ingapore. It in ested in /umblebee Corp.$ a?hilippine corporation$ b" ac uiring J!* o its shares. 2s a result$ La'sengsit Corp. nominatedJ!* o the directors o /umblebee Corp.$ all o 'hom are 3ingaporeans and o icers oLa'sengsit Corp.

0hoose the correct statement re!atin- to >a'sen-sit 0orp. (1%

(2) La'sengsit Corp. is doing business in the ?hilippines and re uires a license rom the3ecurities and E+change Commission (3EC).

(/) La'sengsit Corp. is not doing business in the ?hilippines b" its mere in estment in a

?hilippine corporation and does not need a license rom the 3EC.

(C) La'sengsit Corp. has to appoint a resident agent in the ?hilippines.

(8) La'sengsit Corp. cannot elect directors in /umblebee Corp.

(E) 2ll the abo e choices are incorrect.


10/14

,II.

The /I- assessed 2/C Corp. or de icienc" income ta+ or ta+able "ear,!1! in the amount o?,@$BJ1$,! .!!$ inclusi e o surcharge and penalties.

he #I can :::::::. (1%

(2) run a ter the directors and o icers o 2/C Corp. to collect the de icienc" ta+ and theirliabilit" 'ill be solidar"

(/) run a ter the stockholders o 2/C Corp. and their liabilit" 'ill be Doint

(C) run a ter the stockholders o 2/C Corp. and their liabilit" 'ill besolidar"

(8) run a ter the unpaid subscriptions still due to 2/C Corp.$ i an"

(E) None o the abo e choices is correct.

,III.

2nton imported per umes rom Tai'an and these 'ere released to him b" the bank under a trustreceipt. 0hile the per umes 'ere in 2ntonAs 'arehouse$ thie es broke in and stole all o them.

Who 'i!! shou! er the !oss o" the sto!en per"umes? (1%

(2) The loss o the per umes 'ill be borne b" the bank in 'hose behal the per umes 'ere heldin trust.

(/) 2nton 'ill bear the loss.

(C) The e+porter can hold both the bank and 2nton liable or the loss.

(8) The e+porter rom 'hom 2nton bought the per umes 'ill bear the loss.

(E) No one bears the loss or an un oreseen e ent.

I .

2 bank ma" ac uire real propert" . (1*)

(2) b" purchase at a public sale o properties le ied to satis " ta+ delin uencies

(/) b" purchase rom a real estate corporation in the ordinar" course o the bankAs business

(C) through dacion en pago in satis action o a debt in a or o the bank


11/14

(8) in e+change or the purchase o shares o stocks o the bank

(E) 2ll o the abo e.

(F) None o the abo e.

.

=nder the 2nti %one" aundering 2ct$ a depositorAs bank account ma" be ro en .(1*)

(2) b" the bank 'hen the account is the subDect o a suspicious or co ered transaction report

(/) b" the 2nti %one" aundering Council (2% C) 'hen the account belongs to a personalread" con icted o mone" laundering

(C) b" the -egional Trial Court$ upon e+ parte motion b" the 2% C$ in a criminal prosecutionor mone" laundering pending be ore it(8) b" the Court o 2ppeals motu proprio in an appeal rom a Dudgment o con iction o acriminal charge or mone" laundering

(E) In none o the abo e.

I.

=nkno'n to the other our proponents$ Enrico ('ho had been gi en the task o attending to the2rticles o Incorporation o the proposed corporation$ 2uto %o$ 2"os >o) misappropriated the

iling ees and ne er iled the 2rticles o Incorporation 'ith the 3ecurities and E+changeCommission (3EC). Instead$ he prepared and presented to the proposed incorporators a alsi ied3EC certi icate appro ing the 2rticles. -el"ing on the alsi ied 3EC certi icate$ the latter beganassuming and discharging corporate po'ers.

Auto /o& Ayos @o is a :::::. (1%

(2) de Dure corporation

(/) de acto corporation

(C) corporation b" estoppel

(8) general partnership


II.


12/14

?re erred shares cannot ote on the proposal . (1*)

(2) to include other corporate o icers in the corporationAs b" la's

(/) to issue corporate bonds

(C) to shorten the corporate term

(8) 2ll o the abo e.


III.

In ,!1!$ the ?hilippine National ?olice declared >adda " /enDelani 6?ublic Enem" No. 1O because o his terrorist acti ities in the countr" that ha e resulted in the death o thousands o

Filipinos. 2 ransom o ?15 million 'as placed on >adda " /enDelaniAs head. 0orried about theuture o their amil"$ >adda " /enDelaniAs estranged 'i e$ 2urelia$ secured in 8ecember ,!1! ali e insurance polic" on his li e and designated hersel as the bene iciar".

Is the po!icy )a!i an *in in-? (1%

(2) 4es$ the polic" is alid and binding because 2urelia has an insurable interest on the li e o>adda " /enDelani.

(/) No$ the polic" is not alid and binding because >adda " /enDelani has been o iciall"declared a public enem".

(C) 4es$ the polic" is alid and binding because it has been in orce or more than t'o "ears.

(8) No$ the polic" is not alid and binding since the spousesA estrangement remo ed 2ureliaAsinsurable interest in /enDelaniAs li e.


I,.

%uebles Classico$ Inc. (%C)$ a %anila based urniture shop$ purchased hard'ood lumber rom

3urigao Timber$ Inc. (3TI)$ a %indanao based logging compan". %C 'as to pa" 3TI the amounto ?5.! million or 5! tons o lumber. To pa" 3TI$ %C opened a letter o credit 'ith /anco de?lata (/8?). /


13/14

2 ter shipping the lumber$ 3TH 'ent to /8?$ presented the shipping documents$ and demanded pa"ment o the letter o credit opened in its a or. %C$on the other hand$ in ormed the bank othe 3ta" ong$ and second$ in %anila.

,.(1 Whi!e tra)e!!in- "rom o+yo to on- @on-& the -oo s 'ere ama-e . What !a''i!! -o)ern? (1%

(2) Hapanese la'

(/) ;ong >ong la'

(C) Chinese la'

(8) ?hilippine la'

(E) 2merican la'

,.(2 Assumin- hi!ippine !a' to *e app!ica*!e an uan "ai!s to "i!e a c!aim 'ith thecarrier& may he sti!! commence an action to reco)er ama-es 'ith the court? (1%

(2) No$ the ailure to ile a claim 'ith the carrier is a condition precedent or reco er".

(/) 4es$ pro ided he iles the complaint 'ithin 1! "ears rom deli er".


14/14

(C) 4es$ pro ided he iles the complaint 'ithin 1! "ears rom disco er" o the damage.

(8) 4es$ pro ided he iles the complaint 'ithin 1 "ear rom deli er".

(E) 4es$ pro ided he iles the complaint 'ithin 1 "ear rom disco er" o the damage.

Commercial Law 2013

Documents

Transcript of Commercial Law 2013