Philippine School of Business Administration

826 R. Papa St., Sampaloc, Manila

CPA REVIEW
BUSINESS LAW MACMOD AGENCY, PLEDGE AND MORTGAGES ATTY.

I. Identification: Ba ic Conce!t and !"inci!#e $$$$$$$$$$$$$$$$$$ %. T&e !o'e" of t&e a(ent to #e(a##) "e!"e ent t&e !"inci!a#. $$$$$$$$$$$$$$$$$$ *. A !e" on to '&o+ t&e a(ent de#e(ate &i !o'e" . $$$$$$$$$$$$$$$$$$ ,. An a(enc) '&ic& co+!"i e on#) act of ad+ini t"ation. $$$$$$$$$$$$$$$$$$ -. An a(enc) '&ic& co+!"i e one o" +o"e !ecific t"an action . $$$$$$$$$$$$$$$$$$ .. A "ea# e tate +o"t(a(e in t&e fo"+ of con/entiona# "ede+!tion o" a0 o#1te a#e. $$$$$$$$$$$$$$$$$$ 2. One '&o e 01 ine i to "ecei/e and e## (ood fo" a co++i ion. $$$$$$$$$$$$$$$$$$ 3. Additiona# co++i ion (i/en '&en an a(ent (1a"antee t&e !a)+ent to t&e !"inci!a# of de0t d1e to &i+. $$$$$$$$$$$$$$$$$$4.Cont"act '&e"e0) one de#i/e" to anot&e" +one) o" ot&e" con 1+a0#e t&in( !"o/ided t&e a+e a+o1nt o" 51a#it) &a## 0e "e#ated6!aid. $$$$$$$$$$$$$$$$$$ 7. Cont"act '&e"e0) one de#i/e" to anot&e" non8con 1+a0#e t&in( fo" t&e #atte" to 1 e and "et1"n #ate". $$$$$$$$$$$$$$$$$$ %9. A cont"act '&e"ein t&e c"edito" ac51i"e t&e "i(&t to "ecei/e f"1it of an i++o/a0#e of &i de0to", 'it& an o0#i(ation to a!!#) t&e+ to t&e !"inci!a#. $$$$$$$$$$$$$$$$$$ %%. Cont"act '&e"e0) !e" ona# !"o!e"t) i "eco"ded in t&e c&atte# +o"t(a(e "e(i te"ed a ec1"it) fo" t&e !e"fo"+ance of an o0#i(ation. $$$$$$$$$$$$$$$$$$ %*. A ti!1#ation in cont"act of !#ed(e. Mo"t(a(e o" anti c&"e i '&e"e0) c"edito" i (i/en t&e !o'e" to a!!"o!"iate fo" &i+ e#f t&e t&in( (i/en a ec1"it) if t&e !"inci!a# o0#i(ation i not f1#fi##ed. $$$$$$$$$$$$$$$$$$ %,. In !#ed(e if t&e !"ice of t&e a#e i #e t&an t&e !"inci!a# o0#i(ation, c"edito" cannot "eco/e" t&e deficienc), not'it& tandin( an) cont"a") ti!1#ation. $$$$$$$$$$$$$$$$$$ %-. A cont"act '&e"e0) t&e de0to" de#i/e" to t&e c"edito" a !e" ona# !"o!e"t) a a ec1"it) fo" a c"edit. $$$$$$$$$$$$$$$$$$ %.. A !e" on '&o 0ind &i+ e#f o#ida"i#) 'it& t&e !"inci!a# de0to" fo" t&e !a)+ent of an o0#i(ation. TRUE OR :ALSE %2. T&e #i+it of t&e a(ent; a1t&o"it) &a## not 0e con ide"ed e<ceeded &o1#d it &a/e 0een !e"fo"+ed in +anne" +o"e ad/anta(eo1 to t&e !"inci!a#. $$$$$$$$$$ %3. T&e !"inci!a# +a) "e/o=e t&e a(enc) at 'i##, and co+!e# t&e a(ent to "et1"n t&e doc1+ent e/idencin( t&e a(enc). S1c& "e/ocation +a) 0e e<!"e o" i+!#ied. $$$$$$$$$$ %4. In a(enc), t&e"e i fid1cia") "e#ation 0et'een t'o !e" on 0eca1 e it i 0a ed on 1t+o t t"1 t and confidence. $$$$$$$$$$ %7. If t&e a(ent i inca!acitated, t&e cont"act 0et'een &i+ and t&e t&i"d !e" on i 0indin( a(ain t t&e !"inci!a#, !"o/ided t&e !"inci!a# i ca!acitated. $$$$$$$$$$ *9. T&e (ene"a# "1#e i t&at a (1a"dian cannot !1"c&a e t&e !"o!e"t) of a !e" on 1nde" (1a"dian &i!. >o'e/e", &e +a) do o at a !10#ic a1ction '&en done t&"o1(& &i a(ent. $$$$$$$$$$

* *%. To #ea e !"o!e"t) to anot&e" !e" on, t&e a1t&o"it) of t&e a(ent +1 t 0e in a !ecia# !o'e" of atto"ne), if t&e #ea e i fo" one )ea". $$$$$$$$$$ **. T&e "e !on i0i#it) of t'o o" +o"e a(ent , e/en t&o1(& t&e) &a/e 0een a!!ointed i+1#taneo1 #), i not o#ida"), if o#ida"it) &a not 0een e<!"e #) ti!1#ated. If o#ida"it) &a 0een a("eed 1!on, eac& of t&e+ i "e !on i0#e fo" t&e nonf1##fi##+ent of t&e a(enc), and fo" t&e fa1#t o" ne(#i(ence of &i fe##o' a(ent , e<ce!t in t&e #atte" ca e '&en t&e fe##o' a(ent acted 0e)ond t&e co!e of t&ei" a1t&o"it). $$$$$$$$$$ *,. S&o1#d t&e co++i ion a(ent "ecei/e on a a#e, in addition to t&e o"dina") co++i ion, anot&e" ca##ed a (1a"antee co++i ion, &e &a## 0ea" t&e "i = of co##ection and &a## !a) t&e !"inci!a# t&e !"oceed of t&e a#e on t&e a+e te"+ a("eed 1!on 'it& t&e !1"c&a e". $$$$$$$$$$ *-. If t&e a(ent i !"o&i0ited f"o+ a!!ointin( a 108a(ent, an) act e<ec1ted 0) t&e #atte" i 1nenfo"cea0#e on t&e !a"t of t&e !"inci!a#. $$$$$$$$$$ *.. T&e a(enc) &a## "e+ain in f1## fo"ce and effect e/en afte" t&e deat& of t&e !"inci!a#, if it &a 0een con tit1ted in t&e co++on inte"e t of t&e #atte" and of t&e a(ent o" in t&e inte"e t of a t&i"d !e" on '&o &a acce!ted t&e ti!1#ation in &i fa/o". $$$$$$$$$$ *2. An a(enc) co1c&ed in a (ene"a# te"+ co+!"i e on#) act of ad+ini t"ation, e/en if t&e !"inci!a# &o1#d tate t&at &e 'it&&o#d no !o'e" o" t&at t&e a(ent +a) e<ec1te 1c& act a &e +a) con ide" a!!"o!"iate, o" e/en t&o1(& t&e a(enc) &o1#d a1t&o"i?e a (ene"a# and 1n#i+ited +ana(e+ent. $$$$$$$$$$ *3. If t&e !"inci!a# di"ect#) +ana(e t&e 01 ine ent"1 ted to t&e a(ent t&e"e i i+!#ied "e/ocation of t&e a(enc). $$$$$$$$$$ *4. In a(enc), t&e"e i a +eetin( of +ind 0et'een t&e !a"tie , e<!"e #) o" i+!#ied#)@ '&i#e in ne(otio"i1+ (e tio, t&e"e i no +eetin( of +ind 0et'een t&e t'o !e" on 0eca1 e t&e "e#ation i c"eated 0) o!e"ation of #a'. $$$$$$$$$$ *7. To +a=e c1 to+a") (ift fo" c&a"it) t&e a1t&o"it) of t&e a(ent +1 t 0e a !ecia# !o'e" of atto"ne). $$$$$$$$$$ ,9. If t&e a(ent acted in t&e na+e of t&e !"inci!a#, 01t 'it&o1t a1t&o"it), t&e cont"act i /oida0#e 10Aect to "atification. $$$$$$$$$$ ,%. If t&e t&in( !#ed(ed i "et1"ned 0) t&e !#ed(ee to t&e !#ed(o" o" o'ne", t&e !"inci!a# o0#i(ation i e<tin(1i &ed. $$$$$$$$$$ 32. A chattel mortgage exists when personal property is recorded in the Chattel Mortgage Register as a security for the performance of the obligation. __________ 33. In chattel mortgage the mortgagor must execute an affida!it of good faith in order that the mortgage shall be !alid against third person. __________ 3". If the thing pledged is sold but the proceeds of the sale is less than the principal obligation the pledgee can collect the deficiency from the pledgor. __________ 3#. Any stipulation in a contract of pledge authori$ing the pledgee to sell the thing pledged if the pledgor cannot pay is !oid. __________ 3%. Incorporeal rights e!idenced by negotiable instruments bills of lading shares of stoc& bonds warehouse receipts and similar documents may also be pledged. 'he instrument pro!ing the right pledged shall be deli!ered to the creditor and if negotiable must be endorsed. __________ 3(. If the pledge earns or produces fruits income di!idends or interests the creditor shall compensate what he recei!es 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. )nless there is a stipulation to the contrary the pledge shall extend to the interest and earnings of the right pledged. __________ 3*. +ledge is a real contract which is perfected from the time the thing pledge is placed in the possession of the creditor or of a third person by common agreement. __________ 3,. If two or more things are pledged the pledgee may choose which he will cause to be sold unless there is stipulation to the contrary. -e may demand the sale of only as many of the things as are necessary for the payment of the debt. __________ ".. +ledge is a consensual contract which is perfected from the time the thing pledged is placed in the possession of the creditor or of a third person by common agreement. __________ "/. If the thing pledged is alienated by the pledgor consented by the pledgee the ownership and possession is transmitted to the !endee after alienation. __________ "2. In mortgage the mortgagee is entitled to the entire proceeds of the sale of the thing mortgaged. __________

, "3. In chattel mortgage and in sale con pacto de retro the title to the sub0ect matter of the contract is transferred to the other party. __________ "". If the immo!able mortgaged is sold and the amount reali$ed is less than the mortgage debt the buyer of the mortgaged property is liable to pay the deficiency if any. __________ "#. A stipulation forbidding the owner from alienating the immo!able mortgage is !alid. __________ MULTIPLE C>OICE -2. D%, D* and D, 0o""o'ed f"o+ C P,99,999 a a ec1"it), &e +o"t(a(ed t&ei" 1ndi/ided a("ic1#t1"a# #and to C, S10 e51ent#), D% !aid C P%99,999. I t&e +o"t(a(e on D%; &a"e of t&e #and e<tin(1i &edB a. Ye , 0eca1 e t&e o0#i(ation of D% on t&e de0t i on#) P%99,999 0. Ye , t&e o0#i(ation of t&e de0to" i Aoint, D% i an 'e"a0#e on#) fo" P%99,999 c. No, 0eca1 e t&e o0#i(ation i o#ida"), !a)+ent in !a"t &a## not e<tin(1i & t&e o0#i(ation ec1"ed 0) t&e +o"t(a(e. d. No, 0eca1 e +o"t(a(e a"e con ide"ed indi/i i0#e, !a)+ent in !a"t &a## not e<tin(1i & t&e o0#i(ation ec1"ed 0) t&e +o"t(a(e. -3. B '"ote S, &i i te", to e## &i !a"ce# of #and. T&e #and 'a !1"c&a ed 0) C, 01t S did not fo"'a"d t&e +one) to B. No' 'ant to "eco/e" t&e !a"ce# of #and. a. B cannot "eco/e" 0eca1 e t&e a#e i /a#id 0. B can "eco/e" 0eca1 e t&e a#e 0et'een S and C i /oid, t&e"efo"e t&e"e i no a#e c. B can "eco/e" on#) if B can "et1"n t&e +one) !aid 0) C to S d. An 'e" not (i/en -4. If P #ead C to 0e#ie/e t&at A i &i DP; E a(ent, '&en a a +atte" of fact 1c& i not t"1e, and A act on 1c& +i "e!"e entation, t&e"e i a. An i+!#ied a(enc) 0. An a(enc) 0) e to!!e# c. An a(enc) 0) nece it) d. An e<!"e a(enc) 0) 'o"d !o=en -7. W&ic& of t&e fo##o'in( tate+ent i t"1e and co""ect: a. P#ed(e and +o"t(a(e a"e acce o") cont"act 0eca1 e t&e) can not e<i t 0) t&e+ e#/e 0. In 0ot& !#ed(e and +o"t(a(e t&e c"edito" i entit#ed to deficienc) A1d(+ent c. W&e"e an o0#i(ation i ec1"ed 0) a !#ed(e o" +o"t(a(e and it i not !aid '&en d1e t&e !#ed(e o" +o"t(a(ee +a) a!!"o!"iate t&e t&in( !#ed(e o" +o"t(a(ed if t&e"e i an a("ee+ent to t&at effect 0et'een t&e !a"tie . d. Un#e ot&e"'i e a("eed 1!on 0) t&e !a"tie , t&e a#e of t&e +o"t(a(e !"o!e"t) e<tin(1i &e in f1## t&e o0#i(ation of t&e C offe"ed to 01) t&e #and f"o+ A. .9. An i+!#ied a(enc) +a) 0e c"eated 0) a. Ratification 0. Lac= of action 0) t&e !"inci!a# c. Si#ence of t&e !"inci!a# d. A## of t&e+ .%. D !#ed(e &i "in( to C fo" P%9,999. D fai#ed to !a) &i o0#i(ation on ti+e. C o#d it6at !10#ic a1ction fo" P4,999. a. C can "eco/e" die deficienc) e/en 'it&o1t ti!1#ation 0. C cannot "eco/e" t&e deficienc) e/en if t&e"e i ti!1#ation c. C cannot "eco/e" t&e deficienc) d. C can "eco/e" t&e deficienc) .*. Wit&o1t P; a1t&o"it), S o#d P; ca" to B in P; 0e&a#f a. T&e t"an action ente"ed 0) S i 1na1t&o"i?ed t&e"efo"e 1nenfo"cea0#e 0. T&e "i(&t of B i on#) a(ain t S a a "1#e c. T&e cont"act can 0e "atified, &ence it i con ide"ed a a /a#ida0#e cont"act d. A## of t&e a0o/e .,. P '"ote #ette" a1t&o"i?in( A to e## &i !a"ce# of #and it1ated in B1#acan. T&e #and 'a !1"c&a ed 0) C, 01t t&e a(ent DAE did not (i/e t&e +one) to P t&e a#e of A to C i @

a. 0. c. d. Foid 0eca1 e t&e a1t&o"it) of A i not in a !10#ic in t"1+ent Unenfo"cea0#e 0eca1 e t&e a1t&o"it) of A i in a !10#ic in t"1+ent Ine<i tent 0eca+e t&e a1t&o"it) of A i in !"i/ate '"itin( Fa#id and enfo"cea0#e

.-. P a!!ointed A a &i a(ent to 0o""o' P%9,999 f"o+ C. A 0o""o'ed P%9,999 acted in &i na+e 01t (i/e t&e +one) to &i !"inci!a#, '&o acce!t t&e+. U!on +at1"it), '&o i #ia0#e to CB a. A on#) 0. P on#) c. Bot& A and P d. Cont"act i /oid ... A a!!oint a. 0. c. B a &i a(ent to e## &i #and , '&ic& of t&e fo##o'in( i /a#idB T&e a1t&o"it) of B i in '"itin( 01t B +o"t(a(e it a# o in '"itin( T&e a1t&o"it) of B f"o+ A i 0) 'a) of #ette" and B e## t&e #and to C in '"itin( T&e a1t&o"it) of B i o"a# and B e## t&e #and to C fo" P.9,999 in a '"itten cond1ct of a#e d. T&e a1t&o"it) of B i in '"itin( 01t t&e a#e of t&e #and in '"itin( 'a +ade 0e)ond t&e !e"iod e<!"e #) et fo"t& 0) A.

.2. P a!!ointed A a &i a(ent 'it& (ene"a# !o'e" on Gan1a") %. T&e ne<t da), C t"an acted 01 ine 'it& A. On Gan1a") ., P "e/o=ed t&e a(enc) and !10#i &ed it in a ne' !a!e" of (ene"a# ci"c1#ation. >o'e/e", C did not "ead t&e ne' !a!e" !10#ication. Mi< . da) , DGan1a") %9E C con 1++ated anot&e" t"an action 'it& A. I t&e additiona# of A 0indin( a(ain t P. a. Ye , 0eca1 e C i in (ood fait& 0. No, 0eca1 e t&e a(enc) i con ide"ed "e/o=ed and it !10#ication i a efficient 'a"nin( c. No, 0eca1 e t&e !o'e" i (ene"a#, t&e"e +1 t a# o 0e a !ecia# !o'e" d. Ye , 0eca1 e t&e"e 'a no !ecia# notice end to C. .3. Toda), P a!!ointed A% a &i a(ent co/e"ed 0) (ene"a# !o'e" to #ea e &i ca" to C fo" 2 +ont& . T&e ne<t da), P a!!ointed A* 'it& !ecia# !o'e" to #ea e t&e a+e ca" to C fo" . +ont& . On t&e t&i"d da), P di"ect#) t"an acted 01 ine 'it& C #ea in( t&e ca" fo" * +ont& . W&at i t&e effect of a(enc) 0et'een t&e !a"tie B a. T&e a!!oint+ent of A% i t&e one t&at i /a#id 0eca1 e it &a (ot a !"io" date. 0. T&e a!!oint+ent of A* i t&e one t&at i /a#id 0eca1 e it i co/e"ed 0) a !ecia# !o'e". c. T&e a(enc) of A% and A* a"e con ide"ed "e/o=ed 0eca+e t&e !"inci!a# di"ect#) t"an acted 'it& C. d. None of t&e a0o/e. .4. P a!!ointed A a &i a(ent to e## &i !ecific ca" in ca & fo" P%9, 999 'it& %9H co++i ion. A 1 in( !e" 1a i/e =i## A 'a a0#e to e## it fo" P%., 999 on c"edit. Afte" t&e a#e 01t 0efo"e t&e !a)+ent of t&e 01)e" a. A +1 t (i/e P%9, 999 on#). 0. A +1 t (i/e P%9, 999 +in1 t&e co++i ion c. A +1 t (i/e P%., 999 +in1 t&e co++i ion d. A +1 t (i/e P%., 999 and in t1"n i to (i/e A P., 999 a co++i ion. .7. P t&e o'ne" of a !iece of "e identia# #and o"a##) a1t&o"i?ed A to e## t&e #and fo" P.99.99 'it& .H co++i ion. Toda) A o#d t&e #and to C. One da) #ate" P o#d t&e a+e #and to D. A 1+in( t&at 0ot& 01)e" a"e in (ood fait&, '&o a+on( t&e+ i t&e #a'f1# o'ne". a. C, 0ein( t&e fi" t 01)e" 0. C, 0eca1 e A 'a (i/en a1t&o"it) 0) P. c. D, 0eca1 e t&e a#e +ade 0) A to C i /oid. d. None of t&e a0o/e. 29. An a(ent 'it&o1t an) e<!"e a1t&o"it) f"o+ t&e !"inci!a# a!!ointed a 10a(ent to &e#! &i+ ca"") o1t t&e a(enc) a. T&e 10 tit1tion i /oid. 0. T&e 10 tit1tion i /a#id 01t t&e a(ent i t&e on#) one #ia0#e fo" t&e act of t&e 10a(ent.

. c. Bot& t&e a(ent and 10a(ent a"e #ia0#e to t&e !"inci!a# fo" t&e act of t&e 10a(ent 1nde" t&e /a#id 10 tit1tion. d. T&e 10 tit1tion i /a#id 01t t&e 10 tit1te i t&e on#) one #ia0#e fo" &i o'n act . e. None of t&e a0o/e. 2%. An a(ent 'it& (ene"a# !o'e" of ad+ini t"ation (i/en to &i+ 0) t&e !"inci!a# in '"itin( de i"o1 of i+!"o/in( t&e financia# condition of &i !"inci!a#, o#d t'o !a"ce# of "ice fie#d, one fo" #e t&an t&e !"ice a!!ea"in( in t&e in/ento") !"e!a"ed 0) t&e !"inci!a#, and t&e ot&e" fo" do10#e t&e !"ice t&at a!!ea"ed in t&e aid in/ento"). a. T&e a#e fo" do10#e t&e !"ice a!!ea"in( in t&e in/ento") i 0indin( 1!on t&e !"inci!a#. 0. T&e t'o cont"act cannot 0e enfo"ced a(ain t t&e !"inci!a#. c. T&e a#e fo" #e t&an t&e !"ice a!!ea"in( in t&e in/ento") i 0indin( 1!on t&e !"inci!a#. d. Bot& cont"act a"e 0indin( 1!on t&e !"inci!a#. e. None of t&e a0o/e. 2*. A !a en(e" 01 '&i#e in +otion co##ided 'it& anot&e" 01 . C, t&e cond1cto" of t&e 01 'a 0odi#) inA1"ed. D, t&e d"i/e", a#t&o1(& not a1t&o"i?e, en(a(ed t&e e"/ice of a !&) ician in t&e na+e of t&e co+!an). In &e"e, t&e"e i an a. I+!#ied a(enc) 0. A(enc) 0) e to!!e# c. A(enc) 0) nece it) d. None of t&e a0o/e 2,. State+ent %: T&e cont"act of !#ed(e, (i/e a "i(&t to t&e c"edito" to "etain t&e t&in( in &i !o e ion o" in t&at of a t&i"d !e" on to '&o+ it &a 0een de#i/e"ed, 1nti# t&e de0t i !aid. State+ent *: A !#ed(e &a## not ta=e effect a(ain t t&i"d !e" on if a de c"i!tion of t&e t&in( !#ed(e and t&e date of t&e !#ed(e do not a!!ea" in a !10#ic in t"1+ent. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 2-. State+ent %: If t&e a(ent die , t&e &ei" +1 t notif) t&e !"inci!a# i++ediate#), and +1 t contin1e t&e o0Aecti/e of t&e a(enc) 1nti# it i acco+!#i &ed o" 1nti# t&e !"inci!a# a!!oint a ne' a(ent. State+ent *: If t&e a(ent i !"o&i0ited f"o+ a!!ointin( a 108a(ent an) act e<ec1ted 0) t&e #atte" i 1nenfo"cea0#e, on t&e !a"t of t&e !"inci!a#. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 2.. State+ent %: If t&e a(ent i inca!acitated, t&e cont"act 0et'een &i+ +id t&e t&i"d !e" on i 0indin( a(ain t t&e !"inci!a#, !"o/ided t&e !"inci!a# i ca!acitated. State+ent *: In a(enc), t&e"e i fid1cia") "e#ation 0et'een t'o !e" on 0eca1 e it i 0a ed on o1t+o t t"1 t +id confidence. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 22. State+ent %: T&e a(enc) &a## "e+ain in f1## fo"ce and effect e/en afte" t&e deat& of t&e !"inci!a#, if it &a 0een con tit1ted in t&e co++on inte"e t of t&e #atte" and of t&e a(ent, o" in t&e inte"e t of a t&i"d !e" on '&o &a acce!ted t&e ti!1#ation in &i fa/o". State+ent *: If 10 e51ent to t&e !e"fection of t&e !#ed(e, t&e t&in( !#ed(e i in t&e !o e ion of t&e !#ed(o" o" o'ne", t&e"e i a !"i+a facie !"e 1+!tion t&at t&e a+e &a 0een "et1"ned 0) t&e !#ed(ee, e<tin(1i &in( t&e cont"act of !#ed(e. a. Bot& a"e t"1e 0. Bot& a"e fa# e c. No.% i t"1e@ No.* i fa# e d. No.% i fa# e@ No.* i t"1e

23. State+ent %: If t&e t&in( !#ed(ed i "et1"ned 0) t&e !#ed(ee to t&e !#ed(o" o" o'ne", t&e !"inci!a# o0#i(ation i e<tin(1i &ed. State+ent *: In ca e of !#ed(e of ani+a# , t&ei" off !"in( &a## !e"tain to t&e !#ed(o" of t&e ani+a# !#ed(ed and a"e no #on(e" 10Aect to t&e !#ed(e, 1n#e ti!1#ated. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 24. State+ent %: If a t&in( !#ed(e i a#ienated 0) t&e !#ed(o", con ented 0) t&e !#ed(ee to t&e o'ne" &i! and !o e ion i t"an +itted to t&e /endee afte" a#ienation

2 State+ent *: In a#e at !10#ic a1ction, t&e !#ed(o" o" o'ne" +a) 0e 0id and &a## &a/e a 0ette" "i(&t if &e &o1#d off t&e a+e te"+ a t&e &i(&e t 0idde". a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 27. State+ent %: S&o1#d t&e co++i ion a(ent "ecei/e, in addition to t&e o"dina") co++i ion, anot&e" co++i ion ca##ed (1a"antee co++i ion, &e &a## 0ea" t&e "i = of co##ection and &a## !a) t&e !"inci!a# t&e !"oceed of t&e a#e on t&e a+e te"+ a("eed 1!on 'it& t&e !1"c&a e". State+ent *: T&e "e !on i0i#it) of t'o o" +o"e a(ent , e/en t&o1(& t&e) &a/e 0een a!!ointed i+1#taneo1 #), i not o#ida") if o#ida"it) &a not 0een e<!"e #) ti!1#ated. If o#ida"it) &a 0een a("eed 1!on, eac& of t&e a(ent i "e !on i0#e fo" t&e non8f1#fi#+ent of t&e a(enc), and fo" t&e fa1#t o" ne(#i(ence of &i fe##o' a(ent , e<ce!t in t&e #atte" ca e '&en t&e fe##o' a(ent acted 1!on 0e)ond t&e co!e of t&ei" a1t&o"it). a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 39. State+ent %: E/e") a(ent i 0o1nd to "ende" an acco1nt of &i t"an action and to de#i/e" to t&e !"inci!a# '&ate/e" &e +a) &a/e "ecei/ed 0) /i"t1e of t&e a(enc), e/en t&o1(& it +a) not 0e o'nin( to t&e !"inci!a#. E/e") ti!1#ation e<e+!tin( t&e a(ent f"o+ t&e o0#i(ation to "ende" an acco1nt &a## 0e /oid. State+ent *: An a(enc) co1c&ed in (ene"a# te"+, co+!"i e on#) act of ad+ini t"ation, e/en if t&e !"inci!a# &o1#d tate t&at &e 'it&&o#d no !o'e" o" t&at t&e a(ent +a) e<ec1te 1c& act a &e +a) con ide" a!!"o!"iate, o" e/en t&o1(& t&e a(enc) &o1#d a1t&o"i?e a (ene"a# and 1n#i+ited +ana(e+ent. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 3%. State+ent %: A ti!1#ation in a cont"act of +o"t(a(e ti!1#atin( an 1! et !"ice, at '&ic& t&e !"o!e"t) +a) 0e o#d i /oid. State+ent *: If t&e i++o/a0#e +o"t(a(ed i o#d, and t&e a+o1nt "ea#i?ed i #e t&an t&e +o"t(a(e de0t, t&e 01)e" of t&e +o"t(a(ed !"o!e"t) i #ia0#e to !a) t&e deficienc), if an). a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 3*. State+ent %: A "ea# +o"t(a(e +a) (1a"antee f1t1"e o0#i(ation, '&i#e a c&atte# +o"t(a(e cannot (1a"antee f1t1"e o0#i(ation. State+ent *: T&e +o"t(a(ee &a t&e "i(&t to ta=e !o e ion of t&e c&atte# +o"t(a(ed 1!on defa1#t of t&e +o"t(a(o". a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 3,. State+ent %: In c&atte# +o"t(a(e, t&e +o"t(a(o" +1 t e<ec1te an affida/it of (ood fait& in o"de" t&at t&e +o"t(a(e &a## 0e /a#id a(ain t t&i"d !e" on. State+ent *: An a(enc) cannot 0e "e/o=ed if a 0i#ate"a# cont"act de!end 1!on it, o" if it i t&e +ean of f1#fi##in( an o0#i(ation a#"ead) cont"acted, o" if a !a"tne" i a!!ointed +an(e" of a !a"tne" &i! in t&e cont"act of !a"tne" &i! and &i "e+o/a# f"o+ t&e +ana(e+ent i 1nA1 tifia0#e. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 3-. State+ent %: To #ea e "ea# !"o!e"t) to anot&e" !e" on, t&e a1t&o"it) of t&e a(ent +1 t 0e in a !ecia# !o'e" of atto"ne), if t&e #ea e i fo" one )ea". State+ent *: W&en a a#e of a !iece of #and i +ade t&"o1(& an a(ent, &i a1t&o"it) +1 t 0e in '"itin( ot&e"'i e, t&e a#e i 1nenfo"cea0#e. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e 3.. State+ent %: In a(enc), t&e a(ent "e!"e ent an inca!acitated !e" on. State+ent *: T&e a(ent if a1t&o"i?ed to 0o""o' +one) can 0e t&e #ende", 01t (ene"a##) &e cannot 0e t&e 0o""o'e" if &e i a1t&o"i?ed to #end. a. Bot& a"e t"1e c. No.% i t"1e@ No.* i fa# e 0. Bot& a"e fa# e d. No.% i fa# e@ No.* i t"1e

32. P a!!ointed A o"a##) a &i a(ent to e## &i ca" fo" P%9, 999. A o#d t&e ca" to C acted in &i DA; E na+e. If 1!on t&e de#i/e") t&e ca" &a &idden defect , i P #ia0#eB a. No, 0eca1 e t&e cont"act i 1nenfo"cea0#e, it i o"a##) ente"ed into. 0. Ye , 0eca1 e t&e t&in( 0e#on( to t&e !"inci!a#. c. No, 0eca1 e t&e a(ent acted in &i na+e. d. None of t&e a0o/e. 33. A(enc) i a. 0. c. d. e<tin(1i &ed 0) an) of t&e fo##o'in( ca1 e , ECCEPT B) it "e/ocation B) t&e 'it&d"a'a# of t&e a(ent B) t&e deat& of t&e a(ent o" of t&e !"inci!a# In o#/enc) of t&e a(ent o" &i &ei" .

34. T&e !"inci!a# i not #ia0#e fo" t&e e<!en e inc1""ed 0) t&e a(ent. a. If t&e a(ent acted in cont"a/ention of t&e !"inci!a# in t"1ction. 0. E<!en e 'e"e d1e to t&e fa1#t of t&e a(ent. c. A(ent inc1""ed t&e+ =no'in( t&at an 1nfa/o1"a0#e "e 1#t 'o1#d en 1e, and t&e !"inci!a# 'a not a'a"e t&e"eof. d. A## of t&e a0o/e. 37. A co++i a. 0. c. d. ion a(ent: >a t&e o!tion to act in &i o'n na+e Gene"a##), cannot e## on c"edit Ma) 0e an a(ente de# c"ede"e if &e "ecei/e (1a"ant) co++i ion A## of t&e a0o/e

49. Bea" "i = of co##ectin( f"o+ t&e 01)e" t&e !"ice of t&e a#e. a. Co++i ion a(ent 0. O#d De0to" in de#e(acion c. G1a"anto" d. A(ente de# c"ede"e

A man is what he is because of the thoughts that he allowed to dominate his mind. 8Ficto"