RFBT 05 Contract OF Pledge REAL Mortgage Chattel Mortgage Other Credit Transaction with answers PDF

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COVERAGE:A. Contract of Pledge, Real Mortgage, Chattel Mortgage, Other Credit Transactions and Agency Direction : Read and select the best answer for the following questions. The following requisites are essential to the contracts of pledge, real estate mortgage and chattel mortgage except a. That t...

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a. The contract of mortgage is valid because future property may be pledged or mortgaged. b. The contract of loan is null and void because the contract of mortgage is null and void. c. The contract of mortgage will become valid upon the death of D'S father. d. The contract of mortgage is null and void because the mortgagor must be the owner of the property mortgaged at the time it is constituted but the contract of loan remains to be valid.

COVERAGE: A. Contract of Pledge, Real Mortgage, Chattel Mortgage, Other Credit Transactions and Agency Direction: Read and select the best answer for the following questions. 1. The following requisites are essential to the contracts of pledge, real estate mortgage and chattel mortgage except a. That they be constituted to secure the fulfillment of a principal obligation such as contract of loan. b. That the pledgor or mortgagor be the absolute owner of the thing pledged or mortgaged. c. That the persons constituting the pledge or mortgage have the free disposal of their property, and in the absence thereof, that they be legally authorized for the purpose. d. That when the principal obligation becomes due, the things in which the pledge or mortgage consists may be alienated for the payment of the creditor. e. That the thing pledged or mortgaged be placed in the possession of the creditor, or of a third person by common agreement. 2.

The following are the kinds of principal obligations that may be secured by a contract of pledge, of real estate mortgage or of chattel mortgage, except a. Pure obligations b. Conditional obligations whether suspensive condition or resolutory condition c. Obligations with a period whether suspensive period (ex die) or resolutory period (in diem) d. Natural obligations e. Rescissible obligations f. Voidable obligations g. Unenforceable obligations h. Null and void obligations

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ABC Inc. borrowed P2,000,000 from BPI. ABC Inc. is under receivership. To secure the fulfillment of the loan, ABC mortgaged its administrative building. Which of the following statements is correct? a. The contract of mortgage is null and void because the mortgagor has no free disposal of the thing. b. The contract of mortgage is valid because the mortgagor is the absolute owner of the property mortgaged at the time the mortgage is constituted. c. The contract of mortgage is null and void because only natural person may enter in a contract of mortgage. d. The contract of mortgage is voidable.

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It is a stipulation whereby the thing pledged or mortgaged shall automatically become the property of the creditor in the event of non-payment of the debt within the term fixed. a. Pactum creditarium b. Pactum commissorium c. Pactum debitarium d. Pactum crematorium D borrowed P10,000 from C. To secure the fulfillment of

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the loan, D pledged his laptop. The contract of pledge provides that the creditor-pledgee may automatically

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appropriate the laptop upon failure of the debtor-pledgor

When is the pledgor or mortgagor required to be the owner of the thing pledged or mortgaged for the validity of contracts of pledge, of real estate mortgage or of chattel mortgage? a. At the time the principal obligation is constituted. b. At the time the contract of pledge or mortgage is constituted or perfected. c. At the time of the failure to pay the principal obligation. d. At the time the thing to be pledged or mortgaged is to be delivered. D borrowed P1,000,000 from C. G, a third person, mortgaged his land to secure the fulfillment of D'S loan. Is the contract of mortgage valid? a. No because D must be the owner of the mortgaged land. b. Yes provided G will deliver the land to C. c. Yes because third persons who are not parties to the principal obligation may secure the latter by pledging or mortgaging their own property. d. No because G is no privy to the contract of loan. D borrowed P20,000 from C. To secure the fulfillment of the loan, D mortgaged a land owned by his ailing father. Which of the following statements is correct?

to pay the loan. On the date of maturity of the loan, D failed to pay the loan. Which of the following statements is correct? a. C becomes the owner of the laptop. b. The laptop cannot be alienated for the payment of the loan. c. C does not become the automatic owner of the laptop upon D'S failure to pay the loan because that provision is considered pactum commissorium which is contrary to law and public policy. d. The contract of pledge is null and void because of pactum commissorium provision. 9.

D borrowed P10,000 from C. To secure the fulfillment of the loan, D pledged his laptop. On the date of maturity of the loan, D failed to pay the loan. As a result, D and C agreed that the pledged laptop shall be owned by C in full satisfaction of the secured contract of loan. Which of the following statements is correct? a. C becomes the owner of the laptop by reason of dacion en pago which is governed by Law on Sales. b. The laptop cannot be alienated for the payment of the loan. c. C does not become the automatic owner of the laptop upon D'S failure to pay the loan because their subsequent agreement is

considered pactum commissorium which is contrary to law and public policy. d. Their subsequent agreement for the payment of the loan shall be governed by law on obligation because that is a novation. 10. The following are the instances where the thing pledged or mortgaged may be sold or alienated to pay the principal obligation, except a. If the pledgor or mortgagor fails to fulfill certain conditions and such violation would make the debt due and demandable. b. If the debtor has lost the right to make use of the period or where there is an acceleration clause in the payment of installment. c. Upon default to pay the obligation at maturity. d. Before maturity of the principal obligation. 11. What is the nature of a contract of pledge, of chattel mortgage, of real estate mortgage or of antichresis? a. It is divisible if the principal contract is joint. b. It is indivisible if the principal contract is solidary. c. It is divisible whether the principal contract is joint or solidary. d. It is indivisible whether the principal contract is joint or solidary. 12. D borrowed P10,000 from C and pledged his ring and watch with P4,000 and P6,000 value respectively. After several days, D pays P4,000 to C. Which of the following statements is correct? a. The contract of pledge is extinguished. b. The contract of loan is extinguished. c. D cannot demand the release of his ring because a contract of pledge is indivisible. d. D may compel C to return the ring because P4,000 of the loan is already paid. 13. D borrowed from C P 100,000 secured by a mortgage on D'S two lots (lot 1 and lot 2). D dies leaving E and F as heirs with E inheriting lot 1 and F lot 2. F pays P50,000 of the loan. Which of the following statements is correct? a. F may ask for the extinguishment of the mortgage on lot 2. b. The contract of mortgage is extinguished. c. The contract of loan is extinguished. d. F cannot ask for the extinguishment of the mortgage on lot 2. 14. Using the same data in preceding number, suppose it is C who dies leaving X and Y as heirs. If D pays X P50,000, which of the following statements is correct? a. X may cancel the mortgage to the prejudice of Y. b. X cannot cancel the mortgage to the prejudice of Y. c. The contract of mortgage is extinguished. d. The contract of loan is extinguished. 15. D borrowed P10,000 from C and pledged his ring and watch with P4,000 and P6,000 value respectively. They agreed that the ring will secure P4,000 of the loan and the watch will secure the balance of the loan. After several days, D pays

P4,000 to C. Which of the following statements is correct? a. The contract of pledge on the watch is extinguished. b. The contract of loan is fully extinguished. c. D cannot demand the release of his ring because a contract of pledge is indivisible. d. D may compel C to return the ring because contract of pledge on the ring is extinguished.

16. A and B jointly borrowed P10,000 from C. In order to secure their respective obligations, A pledged his cellphone while B pledged his laptop. At the maturity date of the loan, A paid P5,000 of the loan. Which of the following statements is correct? a. The contract of pledge on the cellphone is extinguished. b. The obligation of B is extinguished. c. A cannot demand the release of his cellphone because a contract of pledge is indivisible. d. The contract of pledge on the laptop is extinguished. 17. A and B jointly borrowed P10,000 from C. In order to secure the obligation, A pledged his cellphone while B pledged his laptop. At the maturity date of the loan, A paid P5,000 of the loan. Which of the following statements is correct? a. The contract of pledge on the cellphone is extinguished. b. The obligation of B is extinguished. c. A cannot demand the release of his cellphone because a contract of pledge is indivisible. d. The contract of pledge on the laptop is extinguished. 18. It is a contract by virtue of which the debtor delivers to the creditor or to a third person a movable, or instrument evidencing incorporeal rights for the purpose of securing the fulfillment of a principal obligation with the understanding that when the obligation is fulfilled, the thing delivered shall be returned with all its fruits and accessions. a. Contract of Pledge b. Contract of Chattel mortgage c. Contract of Real estate mortgage d. Contract of Antichresis 19. In case the cause or consideration of the contract of pledge is not stipulated, what is the cause or consideration of a contract of pledge? a. It has no cause or consideration. b. The cause or consideration of the principal obligation or contract of loan. c. The cause or consideration is the liberality of the pledgor. d. The cause is the service remenerated. 20. The following are the characteristics of a contract of pledge, except

a. Consensual — It is perfected by mere consent. b. Accessory — It has no independent existence of its own because there must be contract of loan. c. Unilaterial — It creates an obligation on the part of the creditor to return the thing upon the fulfillment of the principal obligation. d. Subsidiary — The obligation incurred does not arise until the fulfillment of the principal obligation which is secured. 21. The following are the essential requisites of conventional pledge or contract of pledge, except a. That it be constituted to secure the fulfillment of a principal obligation or contract of loan. b. That the pledgor be the absolute owner of the thing pledged. c. That person constituting the pledge has the free disposal of his property, and in the absence thereof, that he be legally authorized for the purpose. d. That the thing pledged be placed in the possession of the creditor, or a third person by common agreement or there must be delivery of the thing pledged. e. That the contract of pledge be constituted in public document. 22. What is the nature of a contract to constitute a pledge? a. Consensual contract b. Real contract c. Formal contract d. Solemn contract 23. What is the legal effect of a promise or contract to constitute a pledge? a. It is perfected by delivery of the thing pledge. b. It is perfected through the notarization of the promise. c. It is perfected by mere consent and gives rise only to a personal action between the contracting parties. d. It gives rise to a real action over the thing pledged. 24. The following statements pertaining to a promise to constitute a pledge or mortgage are correct, except a. It gives rise only to a personal action between the contracting parties. b. The contract perfected is a real contract. c. It creates no real right in the property but only a right to compel the fulfillment of the promise but there is no contract of pledge or contract of mortgage yet. d. The promissor will be criminally liable if he mortgages or pledges as unencumbered things which he knew were subject to some burden. 25. What is the nature of a contract of pledge? a. Consensual contract b. Real contract c. Formal contract d. Solemn contract

26. The following may become the object of a contract of pledge, except a. All movable b. Personal property susceptible of possession. c. Incorporeal rights which are evidenced by negotiable instruments, bill of lading, shares of stocks, bonds, warehouse receipts and similar documents. d. Real or immovable properties and rights thereon. 27. What is the form of contract of pledge to bind the contracting parties? a. It must be in a private instrument. b. It must be in a public instrument. c. It must be registered in the registry of deeds. d. It may be in any form because it is a real contract. 28. What is the form of Contract of pledge to bind or to affect third persons? a. It must be registered in the chattel mortgage registry. b. It must be registered in the registry of deeds. c. It must be in a public instrument showing a description of the thing pledged and the date of the pledge. d. It must be recorded in the Intellectual Property Office. 29. The contract of pledge shall cover the following, except a. The thing pledged. b. The fruits, income, dividends or interests earned or produced by the thing pledged, unless there is stipulation excluding them. c. The offspring, when the thing pledged is an animal, unless there is a stipulation excluding them. d. The future inheritance of the pledgor. 30. The following are the rights of the debtor-pledgor, except a. To alienate, with the consent of the pledgee, the thing pledged. b. To continue to be the owner of the thing pledged unless it is expropriated. c. To become the owner of the offspring of the animal pledged if there is no stipulation to the contrary but such offspring shall be subject to the pledge. d. To ask for the return of the thing pledged after he has paid the debt and its interest, with expenses in a proper case. e. To ask that the thing pledged be judicially or extra-judicially deposited if it is used without authority or for a purpose other than for its preservation. f. To require that the thing be deposited with a third person if it is in danger of being lost or impaired through the negligence or willful act of the pledgee. g. To demand the return of the thing pledged, upon offering another thing in pledge, provided the latter is of the same kind and

quality, if there are reasonable grounds to fear the destruction or impairment of the thing pledged without the fault of the pledgee. This right is without prejudice to the right of the pledgee to have the thing sold at a public sale. h. To demand the return of the thing pledged despite defaulting on the payment of the secured principal obligation. 31. In case the thing pledged is alienated by the debtorpledgor to third person, what is the effect of the consent of the pledgee to the alienation made by the pledgor of the thing pledged to third person? a. The thing pledged remains to be owned by the debtor-pledgor b. The ownership of the thing pledged is transmitted to the buyer. c. The creditor-pledgee loses possession of the thing pledged. d. The contract of pledge is already extinguished. 32. What is the remedy of the pledgor-debtor if the pledgee-creditor use the thing pledged, without the authority of the owner or should misuse the thing in any other way? a. To ask that it be judicially or extrajudicially deposited. b. To ask for the return of the thing pledged. c. To ask for the extinguishment of the contract of pledge. d. To ask for the extinguishment of the contract of loan.

33. What is the remedy of the pledgor-owner if the thing pledged is in danger of being lost or impaired through the negligent or willful act of the pledgee? a. To require that it be deposited with a third person. b. To ask for the return of the thing pledged. c. To ask for the extinguishment of the contract of pledge. d. To ask for the extinguishment of the contract of loan. 34. What is the remedy of the pledgor-owner if there are reasonable grounds to fear the destruction or impairment of the thing pledged, without the fault of the pledgee? a. To ask for the return of the thing, upon offering another thing in pledge, provided the latter is of the same kind as the former and not of inferior quality but subject to the right of the pledgee to sell the said pledged item in public auction. b. To require that it be deposited with a third person. c. To ask for the extinguishment of the contract of pledge. d. To ask for the extinguishment of the contract of loan.

35. If there are reasonable grounds to fear the destruction or impairment of the thing pledged, without the fault of the pledgee, which is correct? a. The pledgor-owner may ask for the return of the thing, upon offering another thing in pledged, provided the latter is of the same kind as the former and not of inferior quality even it is already sold in public auction by the pledgee-creditor. b. The pledgee-creditor may cause the sale of the thing pledged at a public sale and the proceeds of the auction shall be a security for the principal obligation in the same manner as the thing originally pledged. However, the pledgee is bound to advise the pledgor, without delay, of any danger to the thing pledged. c. The right of the pledgor-owner is superior to the right of the pledgee-creditor. d. The contract of pledge is extinguished by the sale of the thing pledged in the public auction. 36. The following are the obligations of the debtorpledgor, except a. To pay the debt and its interest, with expenses, in a property case, when they are due. b. To pay damages that the pledgee may suffer by reason of the flaws of the thing pledged, if he was aware of such flaws but he did not advise the pledgee of the same. c. To pay for the expenses which are necessary for the preservation of the thing pledged. d. To warrant the thing pledged for its quality and merchantability. 37. The following are the rights of the creditor-pledgee, except a. To retain in his possession the thing pledged until the debt is paid. b. To demand reimbursement of the expenses made for the preservation of the thing pledged. c. To bring actions which pertain to the owner of the thing pledged in order to recover it from, or defend it against third person. d. To use the thing pledged if he is authorized to do so, or when its use is necessary of the preservation of the thing. e. To cause the sale of the thing pledged at a public sale, if there is a danger of destruction, impairment or diminution of value of the thing pledged without his fault. The pledgee is bound to advise the pledgor, without delay, of any danger to the thing pledged. f. To collect and receive the amount due if the thing pledged is a credit which becomes due before it is redeemed, and to apply the same to the payment of his claim. g. If the pledge earns or produces fruits, income. dividends, or interests, the creditor shall compensate what he receives with those which are owing him; but if none are owing him, or insofar as the amount may

exceed that which is due, he shall apply it to the principal. Unless there is a stipulation to the contrary, the pledge shall extend to the interest and earnings of the right pledged. h. To sell the thing pledged upon default of the debtor. i. To appropriate the thing pledged in case the thing pledged is not sold in first and second public auctions. j. To become the automatic owner the thing pledged upon first default of debtor to pay the principal obligation at maturity date. 38. The following are the obligations of creditorpledgee, except a. To take care of the thing pledged with the diligence of a good father of a family. b. To be liable for the loss or deterioration of the thing pledged unless it is due to a fortuitous event. c. To be responsible for the acts of his agents or employees with respect to the thing pledged. d. Not to use the thing pledged except when he is authorized by the owner or when the use of the thing is necessary for its preservation. e. To deliver to the debtor the surplus after paying his claim from what he has collected on a credit that was ...