2005 BAR EXAMINATION QUESTIONS

POLITICAL AND PUBLIC INTERNATIONAL LAW

-I-

(a) The present Constitution introduced the concepts and processes of

Initiative and Referendum. Compare and differentiate one from the other.
(3%)

(b) To give the much needed help to the Province of Aurora which was
devastated by typhoons and torrential rains, the President declared it in a
state of calamity. Give at least four (4) legal effects of such declaration.
(4%)

(c) Enumerate the rights of the coastal state in the exclusive economic zone.
(3%)

- II -

(1.) Police Officer Henry Magiting of the Narcotics Section of the Western
Police District applied for a search warrant in the Regional Trial Court of
Manila for violation of Section 11, Article II (Possession of Prohibited Drugs) of
Republic Act (R.A.) No. 9165 (Comprehensive Dangerous Drugs Act of 2002)
for the search and seizure of heroin in the cabin of the Captain of the MSS
Seastar, a foreign-registered vessel which was moored at the South Harbor,
Manila, its port of destination. Based on the affidavits of the applicants
witnesses who were crew members of the vessel, they saw a box containing
ten (10) kilograms of heroin under the bed in the Captains cabin. The RTC
found probable cause for the issuance of a search warrant; nevertheless, it
denied the application on the ground that Philippine courts have no criminal
jurisdiction over violations of R.A. No. 9165 committed on foreign-registered
vessels found in Philippine waters. Is the ruling of the court correct? Support
your answer with reasons. (5%)
(2.) The Philippines and Australia entered into a Treaty of Extradition
concurred in by the Senate of the Philippines on September 10, 1990. Both
governments have notified each other that the requirements for the entry
into force of the Treaty have been complied with. It took effect in 1990. The
Australian government is requesting the Philippine government to extradite
its citizen, Gibson, who has committed in his country the indictable offense of
Obtaining Property by Deception in 1985. The said offense is among those
enumerated as extraditable in the Treaty. For his defense, Gibson asserts that
the retroactive application of the extradition treaty amounts to an ex post
facto law. Rule on Gibsons contention. (5%)

- III -

(1.) Italy, through its Ambassador, entered into a contract with Abad for the
maintenance and repair of specified equipment at its Embassy and
Ambassadors Residence, such as air conditioning units, generator sets,
electrical facilities, water heaters, and water motor pumps. It was stipulated
that the agreement shall be effective for a period of four years and
automatically renewed unless cancelled. Further, it provided that any suit
arising from the contract shall be filed with the proper courts in the City of
Manila. Claiming that the Maintenance Contract was unilaterally, baselessly
and arbitrarily terminated, Abad sued the State of Italy and its Ambassador
before a court in the City of Manila. Among the defenses they raised were
sovereign immunity and diplomatic immunity.

(a) As counsel of Abad, refute the defenses of sovereign immunity and

diplomatic immunity raised by the State of Italy and its Ambassador.

(b) At any rate, what should be the courts ruling on the said defenses? (5%)

(2.) Adams and Baker are American citizens residing in the Philippines.
Adams befriended Baker and became a frequent visitor at his house. One
day, Adams arrived with 30 members of the Philippine National Police, armed
with a Search Warrant authorizing the search of Bakers house and its
premises for dangerous drugs being trafficked to the United States of
America. The search purportedly yielded positive results, and Baker was
charged with Violation of the Dangerous Drugs Act. Adams was the
prosecutions principal witness. However, for failure to prove his guilt beyond
reasonable doubt, Baker was acquitted. Baker then sued Adams for damages
for filing trumped-up charges against him. Among the defenses raised by
Adams is that he has diplomatic immunity, conformably with the Vienna
Convention on Diplomatic Relations. He presented Diplomatic Notes from the
American Embassy stating that he is an agent of the United States Drug
Enforcement Agency tasked with conducting surveillance operations on
suspected drug dealers in the Philippines believed to be the source of
prohibited drugs being shipped to the U.S. It was also stated that after
having ascertained the target, Adams would then inform the Philippine
narcotic agents to make the actual arrest.

(a) As counsel of plaintiff Baker, argue why his complaint should not be
dismissed on the ground of defendant Adams diplomatic immunity from
suit.

(b) As counsel of defendant Adams, argue for the dismissal of the complaint.
(5%)

- IV -

(1.) Squatters and vendors have put up structures in an area intended for a
Peoples Park, which are impeding the flow of traffic in the adjoining highway.
Mayor Cruz gave notice for the structures to be removed, and the area
vacated within a month, or else, face demolition and ejectment. The
occupants filed a case with the Commission on Human Rights (CHR) to stop
the Mayors move. The CHR then issued an order to desist against Mayor
Cruz with warning that he would be held in contempt should he fail to comply
with the desistance order. When the allotted time lapsed,

Mayor Cruz caused the demolition and removal of the structures.

Accordingly, the CHR cited him for contempt.
(a) What is your concept of Human Rights? Does this case involve violations
of human rights within the scope of the CHRs jurisdiction?

(b) Can the CHR issue an order to desist or restraining order?

(c) Is the CHR empowered to declare Mayor Cruz in contempt?

Does it have contempt powers at all? (5%)

(2.) In March 2001, while Congress was adjourned, the President appointed
Santos as Chairman of the Commission on Elections. Santos immediately
took his oath and assumed office. While his appointment was promptly
submitted to the Commission on Appointments for confirmation, it was not
acted upon and Congress again adjourned. In June 2001, the President
extended a second ad interim appointment to Santos for the same position
with the same term, and this appointment was again submitted to the
Commission on Appointments for confirmation. Santos took his oath anew
and performed the functions of his office. Reyes, a political rival, filed a suit
assailing certain orders issued by Santos. He also questioned the validity of
Santos appointment. Resolve the following issues:cralaw

(a) Does Santos assumption of office on the basis of the ad interim

appointments issued by the President amount to a temporary appointment
which is prohibited by Section 1(2), Article IX-C of the Constitution?

(b) Assuming the legality of the first ad interim appointment and assumption
of office by Santos, were his second ad interim appointment and subsequent
assumption of office to the same position violations of the prohibition on
reappointment under Section 1(2), Article IX-C of the Constitution? (5%)

-V-

(1.) Bruno still had several years to serve on his sentence when he was
conditionally pardoned by the President. Among the conditions imposed was
that he would not again violate any of the penal laws of the Philippines.
Bruno accepted all of the conditions and was released. Shortly thereafter,
Bruno was charged with 20 counts of estafa. He was then incarcerated to
serve the unexpired portion of his sentence following the revocation by the
President of the pardon. Brunos family filed a petition for habeas corpus,
alleging that it was error to have him recommitted as the charges were false,
in fact, half of them were already dismissed. Resolve the petition with
reasons. (4%)

(2.) Ricardo was elected Dean of the College of Education in a State

University for a term of five (5) years unless sooner terminated. Many were
not pleased with his performance. To appease those critical of him, the
President created a new position, that of Special Assistant to the President
with the rank of Dean, without reduction in salary, and appointed Ricardo to
said position in the interest of the service. Contemporaneously, the
University President appointed Santos as Acting Dean in place of Ricardo.

(a) Does the phrase unless sooner terminated mean that the position of
Ricardo is terminable at will?

(b) Was Ricardo removed from his position as Dean of the College of
Education or merely transferred to the position of Special Assistant to the
President? Explain. (5%)

(3.) Pedro Masipag filed with the Ombudsman a complaint against RTC Judge
Jose Palacpac with violation of Article 204 of the Revised Penal Code for
knowingly rendering an unjust judgment in Criminal Case No. 617. Judge
Palacpac filed a motion with the Ombudsman to refer the complaint to the
Supreme Court to determine whether an administrative aspect was involved
in the said case. The Ombudsman denied the motion on the ground that no
administrative case against Judge Palacpac relative to the decision in
Criminal Case No. 617 was filed and pending in his office. State with reasons
whether the Ombudsmans ruling is correct. (4%)

- VI -

(1.) The two accepted tests to determine whether or not there is a valid
delegation of legislative power are the Completeness Test and the Sufficient
Standard Test. Explain each. (4%) (2.) Section 32 of Republic Act No. 4670
(The Magna Carta for Public School Teachers) reads: Sec. 32. Penal
Provision.A person who shall willfully interfere with, restrain or coerce any
teacher in the exercise of his rights guaranteed by this Act or who shall in
any other manner commit any act to defeat any of the provisions of this Act
shall, upon conviction, be punished by a fine of not less than one hundred
pesos nor more than one thousand pesos, or by imprisonment, in the
discretion of the court.

Is the proviso granting the court the authority to impose a penalty of

imprisonment in its discretion constitutional? Explain briefly. (4%)

- VII -

(1.) State with reason(s) whether bail is a matter of right or a matter of

discretion in the following cases: (a) The imposable penalty for the crime
charged is reclusion perpetua and the accused is a minor; (b) The imposable
penalty for the crime charged is life imprisonment and the accused is a
minor; (c) The accused has been convicted of homicide on a charge of
murder and sentenced to suffer an indeterminate penalty of from eight (8)
years and one (1) day of prision mayor, as minimum, to twelve (12) years
and four (4) months of reclusion temporal, as maximum. (4%)

(2.) State with reason(s) which of the following is a government agency or a

government instrumentality:cralaw

(a) Department of Public Works and Highway;

(b) Bangko Sentral ng Pilipinas;

(c) Philippine Ports Authority;

(d) Land Transportation Office;

(e) Land Bank of the Philippines. (5%)

- VIII -

(1.) Mariano was arrested by the NBI as a suspect in the shopping mall
bombings. Advised of his rights, Mariano asked for the assistance of his
relative, Atty. Santos. The NBI noticed that Atty. Santos was inexperienced,
incompetent and inattentive. Deeming him unsuited to protect the rights of
Mariano, the NBI dismissed Atty. Santos. Appointed in his place was Atty.
Barroso, a bar topnotcher who was in the premises visiting a relative. Atty.
Barroso ably assisted Mariano when the latter gave a statement. However,
Mariano assailed the investigation claiming that he was deprived of counsel
of his choice.

Was the NBI correct in dismissing Atty. Santos and appointing Atty. Barroso in
his stead?

Is Marianos statement, made with the assistance of Atty. Barroso, admissible

in evidence? (5%)

(2.) Emilio had long suspected that Alvin, his employee, had been passing
trade secrets to his competitor, Randy, but he had no proof. One day, Emilio
broke open the desk of Alvin and discovered a letter wherein Randy thanked
Alvin for having passed on to him vital trade secrets of Emilio. Enclosed in
the letter was a check for P50,000.00 drawn against the account of Randy
and payable to Alvin. Emilio then dismissed Alvin from his employment.
Emilios proof of Alvins perfidy are the said letter and check which are
objected to as inadmissible for having been obtained through an illegal
search. Alvin filed a suit assailing his dismissal.

Rule on the admissibility of the letter and check. (5%)

- IX -

(1.) In the May 8, 1995 elections for local officials whose terms were to
commence on June 30, 1995, Ricky filed on March 20, 1995 his certificate of
candidacy for the Office of Governor of Laguna. He won, but his qualifications
as an elected official was questioned. It is admitted that he is a repatriated
Filipino citizen and a resident of the Province of Laguna. To be qualified for
the office to which a local official has been elected, when at the latest should
he be:cralaw

(a) A Filipino Citizen? Explain.

(b) A resident of the locality? Explain. (5%)

(2.) Manuel was elected Mayor of the Municipality of Tuba in the elections of
1992, 1995 and 1998. He fully served his first two terms, and during his third
term, the municipality was converted into the component City of Tuba. The
said charter provided for a hold-over and so without interregnum Manuel
went on to serve as the Mayor of the City of Tuba. In the 2001 elections,
Manuel filed his certificate of candidacy for City Mayor. He disclosed, though,
that he had already served for three consecutive terms as elected Mayor
when Tuba was still a municipality. He also stated in his certificate of
candidacy that he is running for the position of Mayor for the first time now
that Tuba is a city. Reyes, an adversary, ran against Manuel and petitioned
that he be disqualified because he had already served for three consecutive
terms as Mayor. The petition was not timely acted upon, and Manuel was
proclaimed the winner with 20,000 votes over the 10,000 votes received by
Reyes as the only other candidate. It was only after Manuel took his oath and
assumed office that the COMELEC ruled that he was disqualified for having
ran and served for three consecutive terms.

(a) As lawyer of Manuel, present the possible arguments to prevent his

disqualification and removal.

(b) How would you rule on whether or not Manuel is eligible to run as Mayor
of the newly-created City of Tuba immediately after having already served for
three (3) consecutive terms as Mayor of the Municipality of Tuba?

(c) Assuming that Manuel is not an eligible candidate, rebut Reyes claim that
he should be proclaimed as winner having received the next higher number
of votes. (5%)
-X-

(1.) There was a boundary dispute between Dueas, a municipality, and

Passi, an independent component city, both of the same province. State how
the two local government units should settle their boundary dispute. (5%)

(2.) The Sangguniang Bayan of the Municipality of Santa, Ilocos Sur passed
Resolution No. 1 authorizing its Mayor to initiate a petition for the
expropriation of a lot owned by Christina as site for its municipal sports
center. This was approved by the Mayor. However, the Sangguniang
Panlalawigan of Ilocos Sur disapproved the Resolution as there might still be
other available lots in Santa for a sports center. Nonetheless, the Municipality
of Santa, through its Mayor, filed a complaint for eminent domain. Christina
opposed this on the following grounds:cralaw

(a) the Municipality of Santa has no power to expropriate;

(b) Resolution No. 1 has been voided since the Sangguniang Panlalawigan
disapproved it for being arbitrary; and

(c) the Municipality of Santa has other and better lots for that purpose.
Resolve the case with reasons. (5%)

LABOR AND SOCIAL LEGISLATION

-I-

(1.) As Human Resources Department (HRD) manager of EZ Components, an

unorganized manufacturer of electric and electronic components for
household appliances, you are suddenly confronted with demands for
recognition and collective bargaining negotiations from two competing labor
unions. They both claim to represent all the rank-and-file employees. Union A
is led by a moderate faction, while Union B is affiliated with a militant
federation identified with leftist ideology.

Which of the following courses of action should you take to best protect the
interests of your company and employees?

(a) Recognize Union A as the rightful bargaining representative because it

will be more reasonable to deal with;

(b) Recognize Union B because you do not want to antagonize its leftist
connections and foment inter-union conflicts;

(c) Ignore the demands of either union since you cannot be compelled legally
to deal with them at this stage; or

(d) Petition the Bureau of Labor Relations to conduct a certification election

to determine which union really represents the majority of the employees in
the bargaining unit; (10%)

(2.) Little Hands Garment Company, an unorganized manufacturer of

childrens apparel with around 1,000 workers, suffered losses for the first
time in history when its US and European customers shifted their huge
orders to China and Bangladesh. The management informed its employees
that it could no longer afford to provide transportation shuttle services.
Consequently, it announced that a nominal fare would be charged depending
on the distance traveled by the workers availing of the service.

Was the Little Hands Garments Company within its rights to withdraw this
benefit which it had unilaterally been providing to its employees?

Select the best answer(s) and briefly explain your reason(s) therefor.
(a) Yes, because it can withdraw a benefit that is unilaterally given;

(b) Yes, because it is suffering losses for the first time;

(c) Yes, because this is a management prerogative which is not due to any
legal or contractual obligation;

(d) No, because this amounts to a diminution of benefits which is prohibited

by the Labor Code;

(e) No, because it is a fringe benefit that has already ripened into a
demandable right or entitlement. (10%)

- II -

(1.) During the open forum following your lecture to a group of managers and
HRD personnel, you were asked the following questions:cralaw

(a) What qualifying circumstances will convert illegal recruitment to

economic sabotage, thus subjecting its perpetrator or perpetrators to a
penalty of life imprisonment and a fine of at least P500,000.00? (3%)

(b) Is the commission of an unfair labor practice by an employer subject to

criminal prosecution? (3%)

(c) How are the portability provisions of Republic Act No. 7699 beneficial or
advantageous to SSS and GSIS members in terms of their creditable
employment services in the private sector or the government, as the case
may be, for purposes of death, disability or retirement? (3%)

Please explain your answers briefly.

(2.) Mariano Martillo was a mason employed by the ABC Construction

Company. Every time that ABC had a project, it would enter into an
employment contract with Martillo for a fixed period that coincided with the
need for his services, usually for a duration of three to six months.

Since the last project involved the construction of a 40-storey building,

Martillo was contracted for 14 months. During this period, ABC granted wage
increases to its regular employees, composed mostly of engineers and rank-
and-file construction workers as a result of the just concluded CBA
negotiations. Feeling aggrieved and discriminated against, Martillo and other
similarly-situated project workers demanded that the increases be extended
to them, inasmuch as they should now be considered regular employees and
members of the bargaining unit.

(a) If you were ABCs legal counsel, how would you respond to this demand?

(b) How is a project worker different from a casual or contractual worker?

Briefly explain your answers. (6%)

- III -

(1.) Antonio Antuquin, a security guard, was caught sleeping on the job while
on duty at the Yosi Cigarette Factory. As a result, he was dismissed from
employment by the Wagan Security Agency, an independent contractor. At
the time of his dismissal, Antonio had been serving as a watchman in the
factory for many years, often at stretches of up to 12 hours, even on
Sundays and holidays, without overtime, nighttime and rest day benefits. He
thereafter filed a complaint for illegal dismissal and non-payment of benefits
against Yosi Cigarette Factory, which he claimed was his actual and direct
employer.

As the Labor Arbiter assigned to hear the case, how would you correctly
resolve the following:cralaw
(a) Antonios charge of illegal dismissal; and

(b) Antonios claim for overtime and other benefits. (6%)

(2.) Mans Weto had been an employee of Nopolt Assurance Company for the
last ten (10) years. His wife of six (6) years died last year. They had four (4)
children. He then fell in love with Jovy, his co-employee, and they got
married. In October this year, Wetos new wife is expected to give birth to
her first child. He has accordingly filed his application for paternity leave,
conformably with the provisions of the Paternity Leave Law which took effect
in 1996. The HRD manager of the assurance firm denied his application, on
the ground that Weto had already used up his entitlement under that law.
Weto argued that he has a new wife who will be giving birth for the first time,
therefore, his entitlement to paternity leave benefits would begin to run
anew.

(a) Whose contention is correct, Weto or the HRD manager?

(b) Is Jovy entitled to maternity leave benefits? (6%)

- IV -

(1.) Malyn Vartan is a well-known radio-TV talk show host. She signed a
contract with XYZ Entertainment Network to host a one-hour daily talk show
where she interviews various celebrities on topical subjects that she herself
selects. She was paid a monthly remuneration of P300,000.00. The program
had been airing for almost two years when sponsors advertising revenues
dwindled, constraining the network to cancel the show upon the expiration of
its latest contract with Ms. Vartan. The talk-show host protested the
discontinuance of her monthly talent fee, claiming that it was tantamount to
her illegal dismissal from the network since she has already attained the
status of a regular employee.
(a) As the networks legal counsel, how would you justify its decision to
cancel Ms. Vartans program which in effect terminated her services in the
process?

(b) As counsel for the talk-show host, how would you argue your case? (6%)

-V-

During the open forum following your lecture before members of various
unions affiliated with a labor federation, you were asked the following
questions:cralaw

(a) Araw ng Kagitingan and Good Friday are among the 10 paid regular
holidays under Article 94 of the Labor Code. How much will an employee
receive when both holidays fall on the same day? (4%)

(b) May a rank-and-file employee, who is not a member of the union

representing his bargaining unit, avail of the wage increases which the union
negotiated for its members? (4%)

(c) What is meant by payroll reinstatement and when does it apply? (4%)

(d) Under what conditions may a compressed work week schedule be

legally authorized as an exception to the eight-hour a day requirement
under the Labor Code? (4%)

State your answers and your reasons therefor.

- VI -

A group of employees in XYZ Factory belonging to a religious sect, in

conformity with the teachings and dictates of their religion, refused to join
the labor union in the factory. The labor union was able to negotiate a
substantial wage increase in its collective bargaining agreement with
management. A provision therein stated that the wage increase would be
paid to the members of the union only in view of a closed shop union
security clause in the new agreement. The members of the sect protested
and demanded that the wage increase be extended to them. The officers of
the union countered by demanding their termination from the company
pursuant to the closed shop provision in the just-concluded CBA.

(a) Is the CBA provision valid?

(b) Should the company comply with the unions demand of terminating the
members of the religious sect? (6%)

- VII -

(1.) Ricky Marvin had worked for more than ten (10) years in IGB
Corporation. Under the terms of the personnel policy on retirement, any
employee who had reached the age of 65 and completed at least ten (10)
years of service would be compulsorily retired and paid 30 days pay for
every year of service.

Ricky Marvin, whose immigrant visa to the USA had just been approved,
celebrated his 60th birthday recently. He decided to retire and move to
California where the son who petitioned him had settled. The company
refused to grant him any retirement benefits on the ground that he had not
yet attained the compulsory retirement age of 65 years as required by its
personnel policy; moreover, it did not have a policy on optional or early
retirement.

Taking up the cudgels for Ricky Marvin, the union raised the issue in the
grievance machinery as stipulated in the CBA. No settlement was arrived at,
and the matter was referred to voluntary arbitration.

If you were the Voluntary Arbitrator, how would you decide? Briefly explain
the reasons for your award. (5%)
(2.) Carissa, a comely bank teller, was due for her performance evaluation
which is conducted every six months. A rating of outstanding is rewarded
with a merit increase. She was given a below average rating in the last two
periods. According to the banks personnel policy, a third rating of below
average will result in termination. Mr. Perry Winkle called Carissa into his
office a few days before submitting her performance ratings. He invited her
to spend the night with him in his rest house. She politely declined.
Undaunted, Mr. Winkle renewed his invitation, and Carissa again declined. He
then warned her to watch out because she might regret it later on. A few
days later, Carissa found that her third and last rating was again below
average.chanroblesvirtualawlibrary

Carissa then filed a complaint for sexual harassment against Mr. Winkle with
the Department of Labor and Employment. In his counter-affidavit, he
claimed that he was enamored with Carissa. He denied having demanded,
much less received any sexual favors from her in consideration of giving her
an outstanding rating. He also alleged that the complaint was premature
because Carissa failed to refer the matter to the Committee on Decorum and
Discipline for investigation and resolution before the case against him was
filed. In her reply affidavit, Carissa claimed that there was no need for a prior
referral to the Committee on Decorum and Discipline of her complaint.

Resolve the case with reasons. (5%)

- VIII -

(1.) Odeck, a policeman, was on leave for a month. While resting in their
house, he heard two of his neighbors fighting with each other. Odeck rushed
to the scene intending to pacify the protagonists. However, he was shot to
death by one of the protagonists. Zhop, a housemaid, was Odecks surviving
spouse whom he had abandoned for another woman years back. When she
learned of Odecks death, Zhop filed a claim with the GSIS for death benefits.
However, her claim was denied because (a) when Odeck was killed, he was
on leave; and (b) she was not the dependent spouse of Odeck when he died.

Resolve with reasons whether GSIS is correct in denying the claim. (5%)

(2.) Maryrose Gandas application for the renewal of her license to recruit
workers for overseas employment was still pending with the Philippine
Overseas Employment Administration (POEA). Nevertheless, she recruited
Alma and her three sisters, Ana, Joan and Mavic, for employment as
housemaids in Saudi Arabia. Maryrose represented to the sisters that she
had a license to recruit workers for overseas employment. Maryrose also
demanded and received P30,000.00 from each of them for her services.
However, Maryroses application for the renewal of her license was denied,
and consequently failed to employ the four sisters in Saudi Arabia.

The sisters charged Maryrose with large scale illegal recruitment. Testifying
in her defense, Maryrose declared that she acted in good faith because she
believed that her application for the renewal of her license would be
approved. Maryrose adduced in evidence the Affidavits of Desistance which
the four private complainants had executed after the prosecution rested its
case. In the said affidavits, they acknowledged receipt of the refund by
Maryrose of the total amount of P120,000.00 and indicated that they were no
longer interested to pursue the case against Maryrose. Resolve the case with
reasons. (5%)

- IX -

Kitchie Tempo was one of approximately 500 production operators at HITEC

Semiconductors, Inc., an export-oriented enterprise whose business
depended on orders for computer chips from overseas. She was hired as a
contractual employee four years ago. Her contracts would be for a duration
of five (5) months at a time, usually after a one-month interval. Her re-hiring
was contingent on her performance for the immediately preceding contract.

Six months after the expiration of her last contract, Kitchie went to HITECs
personnel department to inquire why she was not yet being recalled for
another temporary contract. She was told that her performance during her
last stint was below average. Since there was no union to represent her,

Kitchie seeks your advice as a labor lawyer about her chances of getting her
job back. What will your advice be? (5%)
TAXATION

-I-

a) Describe the power of taxation. May a legislative body enact laws to raise
revenues in the absence of a constitutional provision granting said body the
power to tax? Explain.

b) May taxes be the subject of set-off or compensation? Explain.

c) Can an assessment for a local tax be the subject of set-off or

compensation against a final judgment for a sum of money obtained by the
taxpayer against the local government that made the assessment? Explain.

d) Is a deficiency tax assessment a bar to a claim for tax refund or tax credit?
Explain.

e) Is the approval of the court, sitting as probate or estate settlement court,

required in the enforcement and collection of estate tax? Explain. (10%)

- II -

(1.) Explain briefly whether the following items are taxable or non-
taxable:cralaw

a) Income from jueteng;

b) Gain arising from expropriation of property;

c) Taxes paid and subsequently refunded;

d) Recovery of bad debts previously charged off;

e) Gain on the sale of a car used for personal purposes. (5%)

(2.) State and discuss briefly whether the following cases may be
compromised or may not be compromised:cralaw

a) Delinquent accounts;

b) Cases under administrative protest, after issuance of the final assessment

notice to the taxpayer, which are still pending;

c) Criminal tax fraud cases;

d) Criminal violations already filed in court;

e) Cases where final reports of reinvestigation or reconsideration have been

issued resulting in the reduction of the original assessment agreed to by the
taxpayer when he signed the required agreement form. (5%)

- III -

(1.) A city outside of Metro Manila plans to enact an ordinance that will
impose a special levy on idle lands located in residential subdivisions within
its territorial jurisdiction in addition to the basic real property tax. If the lot
owners of a subdivision located in the said city seek your legal advice on the
matter, what would your advice be? Discuss. (5%)

(2.) a) State and explain the basis of dutiable value of an imported article
subject to an ad valorem tax under the Tariff and Customs Code. b)
Distinguish countervailing duty from dumping duty. (5%)

(3.) Jacob, after serving a 5-year tour of duty as military attach in Jakarta,
returned to the Philippines bringing with him his personal effects including a
personal computer and a car. Would Jacob be liable for taxes on these items?
Discuss fully. (5%)
- IV -

(1.) State with reasons the tax treatment of the following in the preparation
of annual income tax returns:cralaw

a) Proceeds of life insurance received by a child as irrevocable beneficiary;

b) 13th month pay and de minimis benefits;

c) Dividends received by a domestic corporation from

(i) another domestic corporation; and

(ii) a foreign corporation;

d) Interest on deposits with

(i) BPI Family Bank; and

(ii) a local offshore banking unit of a foreign bank;

e) Income realized from sale of

(i) capital assets; and

(ii) ordinary assets. (5%)

(2.) a) State the conditions required by the Tax Code before the
Commissioner of Internal Revenue could authorize the refund or credit of
taxes erroneously or illegally received.

b) Does a withholding agent have the right to file an application for tax
refund? Explain. (5%)

-V-
A taxpayer received a tax deficiency assessment of P1.2 Million from the BIR
demanding payment within 10 days, otherwise, it would collect through
summary remedies. The taxpayer requested for a reconsideration stating the
grounds therefor. Instead of resolving the request for reconsideration, the BIR
sent a Final Notice Before Seizure to the taxpayer. May this action of the
Commissioner of Internal Revenue be deemed a denial of the request for
reconsideration of the taxpayer to entitle him to appeal to the Court of Tax
Appeals?

Decide with reasons. (5%)

- VI -

Danilo, who is engaged in the trading business, entrusted to his accountant

the preparation of his income tax return and the payment of the tax due. The
accountant filed a falsified tax return by underdeclaring the sales and
overstating the expense deductions by Danilo.

Is Danilo liable for the deficiency tax and the penalties thereon?

What is the liability, if any, of the accountant? Discuss. (5%)

- VII -

An international airline with no landing rights in the Philippines sold tickets in

the Philippines for air transportation. Is income derived from such sales of
tickets considered taxable income of the said international air carrier from
Philippine sources under the Tax Code? Explain. (5%)

- VIII -

JR was a passenger of an airline that crashed. He survived the accident but

sustained serious physical injuries which required hospitalization for 3
months. Following negotiations with the airline and its insurer, an agreement
was reached under the terms of which JR was paid the following amounts:
P500,000.00 for his hospitalization; P250,000.00 as moral damages; and
P300,000.00 for loss of income during the period of his treatment and
recuperation. In addition, JR received from his employer the amount of
P200,000.00 representing the cash equivalent of his earned vacation and
sick leaves.

Which, if any, of the amounts he received are subject to income tax? Explain.
(5%)

- IX -

Company A decides to close its operations due to continuing losses and to

terminate the services of its employees. Under the Labor Code, employees
who are separated from service for such cause are entitled to a minimum of
one-half month pay for every year of service. Company A paid the equivalent
of one month pay for every year of service and the cash equivalent of
unused vacation and sick leaves as separation benefits.

Are such benefits taxable and subject to withholding tax under the Tax
Code?

Decide with reasons. (5%)

-X-

The Roman Catholic Church owns a 2-hectare lot in a town in Tarlac province.
The southern side and middle part are occupied by the Church and a
convent, the eastern side by a school run by the Church itself, the
southeastern side by some commercial establishments, while the rest of the
property, in particular the northwestern side, is idle or unoccupied.

May the Church claim tax exemption on the entire land? Decide with reasons.
(5%)
- XI -

An alien employee of the Asian Development Bank (ADB) who is retiring soon
has offered to sell his car to you which he imported tax-free for his personal
use. The privilege of exemption from tax is granted to qualified personal use
under the ADB Charter which is recognized by the tax authorities.

If you decide to purchase the car, is the sale subject to tax? Explain. (5%)

- XII -

Ralph Donald, an American citizen, was a top executive of a U.S. company in

the Philippines until he retired in 1999. He came to like the Philippines so
much that following his retirement, he decided to spend the rest of his life in
the country. He applied for and was granted a permanent resident status the
following year. In the spring of 2004, while vacationing in Orlando, Florida,
USA, he suffered a heart attack and died. At the time of his death, he left the
following properties:cralaw

(a) bank deposits with Citibank Makati and Citibank Orlando, Florida;

(b) a resthouse in Orlando, Florida;

(c) a condominium unit in Makati;

(d) shares of stock in the Philippine subsidiary of the U.S. Company where he
worked;

(e) shares of stock in San Miguel Corp. and PLDT;

(f) shares of stock in Disney World in Florida;

(g) U.S. treasury bonds; and

(h) proceeds from a life insurance policy issued by a U.S. corporation.

Which of the foregoing assets shall be included in the taxable gross estate in
the Philippines? Explain. (5%)

- XIII -

Josel agreed to sell his condominium unit to Jess for P2.5 Million. At the time
of the sale, the property had a zonal value of P2.0 Million. Upon the advice of
a tax consultant, the parties agreed to execute two deeds of sale, one
indicating the zonal value of P2.0 Million as the selling price and the other
showing the true selling price of P2.5 Million. The tax consultant filed the
capital gains tax return using the deed of sale showing the zonal value of
P2.0 Million as the selling price.

Discuss the tax implications and consequences of the action taken by the
parties. (5%)

- XIV -

(1.) Mr. Fermin, a resident of Quezon City, is a Certified Public Accountant-

Lawyer engaged in the practice of his two professions. He has his main office
in Makati City and maintains a branch office in Pasig City. Mr. Fermin pays his
professional tax as a CPA in Makati City and his professional tax as a lawyer
in Pasig City.

a) May Makati City, where he has his main office, require him to pay his
professional tax as a lawyer? Explain.

b) May Quezon City, where he has his residence and where he also practices
his two professions, go after him for the payment of his professional tax as a
CPA and a lawyer? Explain. (5%)
(2.) In 1995, the BIR filed before the Department of Justice (DOJ) a criminal
complaint against a corporation and its officers for alleged evasion of taxes.
The complaint was supported by a sworn statement of the BIR examiners
showing the computation of the tax liabilities of the erring taxpayer. The
corporation filed a motion to dismiss the criminal complaint on the ground
that there has been, as yet, no assessment of its tax liability; hence, the
criminal complaint was premature. The DOJ denied the motion on the ground
that an assessment of the tax deficiency of the corporation is not a
precondition to the filing of a criminal complaint and that in any event, the
joint affidavit of the BIR examiners may be considered as an assessment of
the tax liability of the corporation.

Is the ruling of the DOJ correct? Explain. (5%)

CIVIL LAW

-I-

Gabby and Mila got married at Lourdes Church in Quezon City on July 10,
1990. Prior thereto, they executed a marriage settlement whereby they
agreed on the regime of conjugal partnership of gains. The marriage
settlement was registered in the Register of Deeds of Manila, where Mila is a
resident. In 1992, they jointly acquired a residential house and lot, as well as
a condominium unit in Makati. In 1995, they decided to change their
property relations to the regime of complete separation of property. Mila
consented, as she was then engaged in a lucrative business. The spouses
then signed a private document dissolving their conjugal partnership and
agreeing on a complete separation of property.

Thereafter, Gabby acquired a mansion in Baguio City, and a 5-hectare

agricultural land in Oriental Mindoro, which he registered exclusively in his
name.

In the year 2000, Milas business venture failed, and her creditors sued her
for P10,000,000.00. After obtaining a favorable judgment, the creditors
sought to execute on the spouses house and lot and condominium unit, as
well as Gabbys mansion and agricultural land.

a) Discuss the status of the first and the amended marriage settlements.
(2%)

b) Discuss the effect/s of the said settlements on the properties acquired by

the spouses. (2%)

c) What properties may be held answerable for Milas obligations? Explain.

(2%)

- II -

In 1985, Sonny and Lulu, both Filipino citizens, were married in the
Philippines. In 1987, they separated, and Sonny went to Canada, where he
obtained a divorce in the same year. He then married another Filipina,
Auring, in Canada on January 1, 1988. They had two sons, James and John. In
1990, after failing to hear from Sonny, Lulu married Tirso, by whom she had
a daughter, Verna. In 1991, Sonny visited the Philippines where he
succumbed to heart attack.

a) Discuss the effect of the divorce obtained by Sonny and Lulu in Canada.
(2%)

b) Explain the status of the marriage between Sonny and Auring. (2%)

c) Explain the status of the marriage between Lulu and Tirso. (2%)

d) Explain the respective filiation of James, John and Verna. (2%)

e) Who are the heirs of Sonny? Explain. (2%)

- III -

Emil, the testator, has three legitimate children, Tom, Henry and Warlito; a
wife named Adette; parents named Pepe and Pilar; an illegitimate child,
Ramon; brother, Mark; and a sister, Nanette. Since his wife Adette is well-off,
he wants to leave to his illegitimate child as much of his estate as he can
legally do. His estate has a net amount of P1,200,000.00, and all the above-
named relatives are still living. Emil now comes to you for advice in making a
will.

How will you distribute his estate according to his wishes without violating
the law on testamentary succession? (5%)

- IV -

Steve was married to Linda, with whom he had a daughter, Tintin. Steve
fathered a son with Dina, his secretary of 20 years, whom Dina named Joey,
born on September 20, 1981. Joeys birth certificate did not indicate the
fathers name. Steve died on August 13, 1993, while Linda died on December
3, 1993, leaving their legitimate daughter, Tintin, as sole heir. On May 16,
1994, Dina filed a case on behalf of Joey, praying that the latter be declared
an acknowledged illegitimate son of Steve and that Joey be given his share in
Steves estate, which is now being solely held by Tintin. Tintin put up the
defense that an action for recognition shall only be filed during the lifetime of
the presumed parents and that the exceptions under Article 285 of the Civil
Code do not apply to him since the said article has been repealed by the
Family Code. In any case, according to Tintin, Joeys birth certificate does not
show that Steve is his father.

a) Does Joey have a cause of action against Tintin for recognition and
partition? Explain. (2%)

b) Are the defenses set up by Tintin tenable? Explain. (2%)

c) Supposing that Joey died during the pendency of the action, should the
action be dismissed? Explain. (2%)
-V-

In 1984, Eva, a Filipina, went to work as a nurse in the USA. There, she met
and fell in love with Paul, an American citizen, and they got married in 1985.
Eva acquired American citizenship in 1987. During their sojourn in the
Philippines in 1990, they filed a joint petition for the adoption of Vicky, a 7-
year old daughter of Evas sister. The government, through the Office of the
Solicitor General, opposed the petition on the ground that the petitioners,
being both foreigners, are disqualified to adopt Vicky.

a) Is the governments opposition tenable? Explain. (2%)

b) Would your answer be the same if they sought to adopt Evas illegitimate
daughter? Explain. (2%)

c) Supposing that they filed the petition to adopt Vicky in the year 2000, will
your answer be the same? Explain. (2%)

- VI -

Hans Herber, a German national, and his Filipino wife, Rhoda, are permanent
residents of Canada. They desire so much to adopt Magno, an 8-year old
orphaned boy and a baptismal godson of Rhoda. Since the accidental death
of Magnos parents in 2004, he has been staying with his aunt who, however,
could hardly afford to feed her own family. Unfortunately, Hans and Rhoda
cannot come to the Philippines to adopt Magno although they possess all the
qualifications as adoptive parents.

Is there a possibility for them to adopt Magno?

How should they go about it? (5%)

- VII -

Don was the owner of an agricultural land with no access to a public road. He
had been passing through the land of Ernie with the latters acquiescence for
over 20 years. Subsequently, Don subdivided his property into 20 residential
lots and sold them to different persons. Ernie blocked the pathway and
refused to let the buyers pass through his land.

a) Did Don acquire an easement of right of way? Explain. (2%)

b) Could Ernie close the pathway and refuse to let the buyers pass? Give
reasons. (2%)

c) What are the rights of the lot buyers, if any? Explain. (2%)

- VIII -

State with reason whether each of the following is a nuisance, and if so, give
its classification, whether public or private:cralaw

a) A squatters hut (1%)

b) A swimming pool (1%)

c) A house of prostitution (1%)

d) A noisy or dangerous factory in a private land (1%)

e) Uncollected garbage (1%)

- IX -

Marvin offered to construct the house of Carlos for a very reasonable price of
P900,000.00, giving the latter 10 days within which to accept or reject the
offer. On the fifth day, before Carlos could make up his mind, Marvin
withdrew his offer.

a) What is the effect of the withdrawal of Marvins offer? (2%)

b) Will your answer be the same if Carlos paid Marvin P10,000.00 as

consideration for that option? Explain. (2%)

c) Supposing that Carlos accepted the offer before Marvin could

communicate his withdrawal thereof?

Discuss the legal consequences. (2%)

-X-

Bernie bought on installment a residential subdivision lot from DEVLAND.

After having faithfully paid the installments for 48 months, Bernie discovered
that DEVLAND had failed to develop the subdivision in accordance with the
approved plans and specifications within the time frame in the plan. He thus
wrote a letter to DEVLAND informing it that he was stopping payment.
Consequently, DEVLAND cancelled the sale and wrote Bernie, informing him
that his payments are forfeited in its favor.

a) Was the action of DEVLAND proper? Explain. (2%)

b) Discuss the rights of Bernie under the circumstances. (2%)

c) Supposing DEVLAND had fully developed the subdivision but Bernie failed
to pay further installments after 4 years due to business reverses. Discuss
the rights and obligations of the parties. (2%)

- XI -
Before he left for Riyadh to work as a mechanic, Pedro left his Adventure van
with Tito, with the understanding that the latter could use it for one year for
his personal or family use while Pedro works in Riyadh. He did not tell Tito
that the brakes of the van were faulty. Tito had the van tuned up and the
brakes repaired. He spent a total amount of P15,000.00. After using the
vehicle for two weeks, Tito discovered that it consumed too much fuel. To
make up for the expenses, he leased it to Annabelle. Two months later, Pedro
returned to the Philippines and asked Tito to return the van. Unfortunately,
while being driven by Tito, the van was accidentally damaged by a cargo
truck without his fault.

a) Who shall bear the P15,000.00 spent for the repair of the van? Explain.
(2%)

b) Who shall bear the costs for the vans fuel, oil and other materials while it
was with Tito? Explain. (2%)

c) Does Pedro have the right to retrieve the van even before the lapse of one
year? Explain. (2%)

d) Who shall bear the expenses for the accidental damage caused by the
cargo truck, granting that the truck driver and truck owner are insolvent?
Explain. (2%)

- XII -

On July 14, 2004, Pedro executed in favor of Juan a Deed of Absolute Sale
over a parcel of land covered by TCT No. 6245. It appears in the Deed of Sale
that Pedro received from Juan P120,000.00 as purchase price. However,
Pedro retained the owners duplicate of said title. Thereafter, Juan, as lessor,
and Pedro, as lessee, executed a contract of lease over the property for a
period of one (1) year with a monthly rental of P1,000.00. Pedro, as lessee,
was also obligated to pay the realty taxes on the property during the period
of lease.
Subsequently, Pedro filed a complaint against Juan for the reformation of the
Deed of Absolute Sale, alleging that the transaction covered by the deed was
an equitable mortgage. In his verified answer to the complaint, Juan alleged
that the property was sold to him under the Deed of Absolute Sale, and
interposed counterclaims to recover possession of the property and to
compel Pedro to turn over to him the owners duplicate of title.

Resolve the case with reasons. (6%)

- XIII -

Rod, the owner of an FX taxi, found in his vehicle an envelope containing TCT
No. 65432 over a lot registered in Cesars name. Posing as Cesar, Rod forged
Cesars signature on a Deed of Sale in Rods favor. Rod registered the said
document with the Register of Deeds, and obtained a new title in his name.
After a year, he sold the lot to Don, a buyer in good faith and for value, who
also registered the lot in his name.

a) Did Rod acquire title to the land? Explain. (2%)

b) Discuss the rights of Don, if any, over the property. (2%)

c) In an ejectment case filed by Don against Cesar, can the latter ask for the
cancellation of Dons title considering that he (Cesar) is the rightful owner of
the lot? Explain. (2%)

- XIV -

Under a written contract dated December 1, 1989, Victor leased his land to
Joel for a period of five (5) years at a monthly rental of P1,000.00, to be
increased to P1,200.00 and P1,500.00 on the third and fifth year,
respectively. On January 1, 1991, Joel subleased the land to Conrad for a
period of two (2) years at a monthly rental of P1,500.00. On December 31,
1992, Joel assigned the lease to his compadre, Ernie, who acted on the belief
that Joel was the rightful owner and possessor of the said lot. Joel has been
faithfully paying the stipulated rentals to Victor. When Victor learned on May
15, 1992 about the sublease and assignment, he sued Joel, Conrad and Ernie
for rescission of the contract of lease and for damages.

a) Will the action prosper? If so, against whom? Explain. (2%)

b) In case of rescission, discuss the rights and obligations of the parties.

(2%)

- XV -

Under the law on quasi-delict, aside from the persons who caused injury to
persons, who else are liable under the following circumstances:cralaw

a) When a 7-year-old boy injures his playmate while playing with his fathers
rifle. Explain. (2%)

b) When a domestic helper, while haggling for a lower price with a fish
vendor in the course of buying foodstuffs for her employers family, slaps the
fish vendor, causing her to fall and sustain injuries. Explain. (2%)

c) A carpenter in a construction company accidentally hits the right foot of

his co-worker with a hammer. Explain. (2%)

d) A 15-year-old high school student stabs his classmate who is his rival for a
girl while they were going out of the classroom after their last class. Explain.
(2%)

e) What defense, if any, is available to them? (2%)

- XVI -

Dr. and Mrs. Almeda are prominent citizens of the country and are frequent
travelers abroad. In 1996, they booked round-trip business class tickets for
the Manila-Hong Kong-Manila route of the Pinoy Airlines, where they are
holders of Gold Mabalos Class Frequent Flier cards. On their return flight,
Pinoy Airlines upgraded their tickets to first class without their consent and,
inspite of their protestations to be allowed to remain in the business class so
that they could be with their friends, they were told that the business class
was already fully booked, and that they were given priority in upgrading
because they are elite members/holders of Gold Mabalos Class cards. Since
they were embarrassed at the discussions with the flight attendants, they
were forced to take the flight at the first class section apart from their friends
who were in the business class. Upon their return to Manila, they demanded
a written apology from Pinoy Airlines. When it went unheeded, the couple
sued Pinoy Airlines for breach of contract claiming moral and exemplary
damages, as well as attorneys fees.

Will the action prosper? Give reasons. (5%)

MERCANTILE LAW

-I-

(1.) What is a negotiable instrument? Give the characteristics of a negotiable

instrument. (2%)

(2.) Distinguish a negotiable document from a negotiable instrument. (2%)

(3.) State and explain whether the following are negotiable instruments
under the Negotiable Instruments Law:cralaw

(i) Postal Money Order;

(ii) A certificate of time deposit which states This is to certify that bearer
has deposited in this bank the sum of FOUR THOUSAND PESOS (P4,000.00)
only, repayable to the depositor 200 days after date.

(iii) Letters of credit;

(iv) Warehouse receipts;

(v) Treasury warrants payable from a specific fund. (5%)

- II -

(1.) Dagul has a business arrangement with Facundo. The latter would lend
money to another, through Dagul, whose name would appear in the
promissory note as the lender. Dagul would then immediately indorse the
note to Facundo.

Is Dagul an accommodation party? Explain. (2%)

(2.) a) What is a crossed check?

What are the effects of crossing a check? Explain.

b) Distinguish an irregular indorser from a general indorser. (3%)

(3.) Brad was in desperate need of money to pay his debt to Pete, a loan
shark. Pete threatened to take Brads life if he failed to pay. Brad and Pete
went to see Seorita Isobel, Brads rich cousin, and asked her if she could
sign a promissory note in his favor in the amount of P10,000.00 to pay Pete.
Fearing that Pete would kill Brad, Seorita Isobel acceded to the request. She
affixed her signature on a piece of paper with the assurance of Brad that he
will just fill it up later. Brad then filled up the blank paper, making a
promissory note for the amount of P100,000.00. He then indorsed and
delivered the same to Pete, who accepted the note as payment of the debt.

What defense or defenses can Seorita Isobel set up against Pete? Explain.
(3%)
- III -

(1.) Under what conditions may a stock corporation acquire its own shares?
(2%)

(2.) Janice rendered some consultancy work for XYZ Corporation. Her
compensation included shares of stock therein.

Can XYZ Corporation issue shares of stock to pay for the services of Janice as
its consultant?

Discuss your answer. (2%)

- IV -

Divine Corporation is engaged in the manufacture of garments for export. In

the course of its business, it was able to obtain loans from individuals and
financing institutions. However, due to the drop in the demand for garments
in the international market, Divine Corporation could not meet its obligations.
It decided to sell all its equipment such as sewing machines, perma-press
machines, high speed sewers, cutting tables, ironing tables, etc., as well as
its supplies and materials to Top Grade Fashion Corporation, its competitor.

a) How would you classify the transaction?

b) Can Divine Corporation sell the aforesaid items to its competitor, Top
Grade Fashion Corporation?

What are the requirements to validly sell the items? Explain.

c) How would you protect the interests of the creditors of Divine

Corporation?
d) In case Divine Corporation violated the law, what remedies are available
to Top Grade Fashion Corporation against Divine Corporation? (5%)

-V-

(1.) a) Under what circumstances may a corporation declare dividends? (2%)

b) Distinguish dividend from profit; cash dividend from stock dividend. (2%)

c) From what funds are cash and stock dividends sourced? Explain why. (2%)

(2.) A Korean national joined a corporation which is engaged in the furniture

manufacturing business. He was elected to the Board of Directors. To
complement its furniture manufacturing business, the corporation also
engaged in the logging business.

With the additional logging activity, can the Korean national still be a
member of the Board of Directors? Explain. (3%)

- VI -

Jojo deposited several cartons of goods with SN Warehouse Corporation. The

corresponding warehouse receipt was issued to the order of Jojo. He
endorsed the warehouse receipt to EJ who paid the value of the goods
deposited. Before EJ could withdraw the goods, Melchor informed SN
Warehouse Corporation that the goods belonged to him and were taken by
Jojo without his consent. Melchor wants to get the goods, but EJ also wants to
withdraw the same.

a) Who has a better right to the goods? Why?

b) If SN Warehouse Corporation is uncertain as to who is entitled to the

property, what is the proper recourse of the corporation? Explain. (5%)
- VII -

(1.) Briefly discuss the doctrine of corporate opportunity. (2%)

(2.) Malyn, Schiera and Jaz are the directors of Patio Investments, a close
corporation formed to run the Patio Caf, an al fresco coffee shop in Makati
City. In 2000, Patio Caf began experiencing financial reverses, consequently,
some of the checks it issued to its beverage distributors and employees
bounced. In October 2003, Schiera informed Malyn that she found a location
for a second caf in Taguig City. Malyn objected because of the dire financial
condition of the corporation. Sometime in April 2004, Malyn learned about
Fort Patio Caf located in Taguig City and that its development was
undertaken by a new corporation known as Fort Patio, Inc., where both
Schiera and Jaz are directors. Malyn also found that Schiera and Jaz, on
behalf of Patio Investments, had obtained a loan of P500,000.00, from
PBCom Bank, for the purpose of opening Fort Patio Caf. This loan was
secured by the assets of Patio Investments and personally guaranteed by
Schiera and Jaz. Malyn then filed a corporate derivative action before the
Regional Trial Court of Makati City against Schiera and Jaz, alleging that the
two directors had breached their fiduciary duties by misappropriating money
and assets of Patio Investments in the operation of Fort Patio Caf.

a) Did Schiera and Jaz violate the principle of corporate opportunity?

Explain.

b) Was it proper for Malyn to file a derivative suit with a prayer for injunctive
relief? Explain.

c) Assuming that a derivative suit is proper, may the action continue if the
corporation is dissolved during the pendency of the suit? Explain. (5%)

- VIII -
Aaron, a well-known architect, is suffering from financial reverses. He has
four creditors with a total claim of P26 Million. Despite his intention to pay
these obligations, his current assets are insufficient to cover all of them. His
creditors are about to sue him. Consequently, he was constrained to file a
petition for insolvency.

a) Since Aaron was merely forced by circumstances to petition the court to

declare him insolvent, can the judge properly treat the petition as one for
involuntary insolvency? Explain.

b) If Aaron is declared an insolvent by the court, what would be the effect, if

any, of such declaration on his creditors? Explain.

c) Assuming that Aaron has guarantors for his debts, are the guarantors
released from their obligations once Aaron is discharged from his debts?
Explain.

d) What remedies are available to the guarantors in case they are made to
pay the creditors? Explain. (5%)

- IX -

(1.) What are the effects of an irrevocable designation of a beneficiary under

the Insurance Code? Explain. (2%)

(2.) Jacob obtained a life insurance policy for P1 Million designating

irrevocably Diwata, a friend, as his beneficiary. Jacob, however, changed his
mind and wants Yob and Jojo, his other friends, to be included as
beneficiaries considering that the proceeds of the policy are sufficient for the
three friends.

Can Jacob still add Yob and Jojo as his beneficiaries? Explain. (2%)
-X-

(1.) M/V Pearly Shells, a passenger and cargo vessel, was insured for
P40,000,000.00 against constructive total loss. Due to a typhoon, it sank
near Palawan. Luckily, there were no casualties, only injured passengers. The
shipowner sent a notice of abandonment of his interest over the vessel to the
insurance company which then hired professionals to afloat the vessel for
P900,000.00. When re-floated, the vessel needed repairs estimated at
P2,000,000.00. The insurance company refused to pay the claim of the
shipowner, stating that there was no constructive total
loss.chanroblesvirtualawlibrary

a) Was there constructive total loss to entitle the shipowner to recover

from the insurance company? Explain.

b) Was it proper for the shipowner to send a notice of abandonment to the

insurance company? Explain. (5%)

(2.) a) When does double insurance exist? (2%)

b) What is the nature of the liability of the several insurers in double

insurance? Explain. (2%)

- XI -

Ricardo mortgaged his fishpond to AC Bank to secure a P1 Million loan. In a

separate transaction, he opened a letter of credit with the same bank for
$500,000.00 in favor of HS Bank, a foreign bank, to purchase outboard
motors. Likewise, Ricardo executed a Surety Agreement in favor of AC Bank.
The outboard motors arrived and were delivered to Ricardo, but he was not
able to pay the purchase price thereof.
a) Can AC Bank take possession of the outboard motors? Why?

b) Can AC Bank also foreclose the mortgage over the fishpond? Explain.
(5%)

- XII -

Hi Yielding Corporation filed a complaint against five of its officers for

violation of Section 31 of the Corporation Code. The corporation claimed that
the said officers were guilty of advancing their personal interests to the
prejudice of the corporation, and that they were grossly negligent in handling
its affairs. Aside from documents and contracts, the corporation also
submitted in evidence records of the officers U.S. Dollar deposits in several
banks overseas - Boston Bank, Bank of Switzerland, and Bank of New York.
For their part, the officers filed a criminal complaint against the directors of
Hi Yielding Corporation for violation of Republic Act No. 6426, otherwise
known as the Foreign Currency Deposit Act of the Philippines. The officers
alleged that their bank deposits were illegally disclosed for want of a court
order, and that such deposits were not even the subject of the case against
them.

a) Will the complaint filed against the directors of Hi Yielding Corporation

prosper? Explain.

b) Was there a violation of the Secrecy of Bank Deposits Law (Republic Act
No. 1405)? Explain. (5%)

- XIII -

(1.) Discuss the kabit system in land transportation and its legal
consequences. (2%)

(2.) Procopio purchased an Isuzu passenger jeepney from Enteng, a holder of

a certificate of public convenience for the operation of public utility vehicle
plying the Calamba-Los Baos route. While Procopio continued offering the
jeepney for public transport services, he did not have the registration of the
vehicle transferred in his name. Neither did he secure for himself a certificate
of public convenience for its operation. Thus, per the records of the Land
Transportation Franchising and Regulatory Board, Enteng remained its
registered owner and operator. One day, while the jeepney was traveling
southbound, it collided with a ten-wheeler truck owned by Emmanuel. The
driver of the truck admitted responsibility for the accident, explaining that
the truck lost its brakes.

Procopio sued Emmanuel for damages, but the latter moved to dismiss the
case on the ground that Procopio is not the real party in interest since he is
not the registered owner of the jeepney. Resolve the motion with reasons.
(3%)

(3.) Baldo is a driver of Yellow Cab Company under the boundary system.
While cruising along the South Expressway, Baldos cab figured in a collision,
killing his passenger, Pietro. The heirs of Pietro sued Yellow Cab Company for
damages, but the latter refused to pay the heirs, insisting that it is not liable
because Baldo is not its employee.

Resolve with reasons. (2%)

- XIV -

(1.) On a clear weather, M/V Sundo, carrying insured cargo, left the port of
Manila bound for Cebu. While at sea, the vessel encountered a strong
typhoon forcing the captain to steer the vessel to the nearest island where it
stayed for seven days. The vessel ran out of provisions for its passengers.
Consequently, the vessel proceeded to Leyte to replenish its supplies.

a) Assuming that the cargo was damaged because of such deviation, who
between the insurance company and the owner of the cargo bears the loss?
Explain.
b) Under what circumstances can a vessel properly proceed to a port other
than its port of destination? Explain. (4%)

(2.) Star Shipping Lines accepted 100 cartons of sardines from Master to be
delivered to 555 Company in Manila. Only 88 cartons were delivered,
however, these were in bad condition. 555 Company claimed from Star
Shipping Lines the value of the missing goods, as well as the damaged
goods. Star Shipping Lines refused because the former failed to present a bill
of lading.

Resolve with reasons the claim of 555 Company. (4%)

- XV -

(1.) S Development Corporation sued Shangrila Corporation for using the S

logo and the tradename Shangrila. The former claims that it was the first
to register the logo and the tradename in the Philippines and that it had
been using the same in its restaurant business. Shangrila Corporation
counters that it is an affiliate of an international organization which has been
using such logo and tradename Shangrila for over 20 years. However,
Shangrila Corporation registered the tradename and logo in the Philippines
only after the suit was filed.

a) Which of the two corporations has a better right to use the logo and the
tradename? Explain.

b) How does the international affiliation of Shangrila Corporation affect the

outcome of the dispute? Explain. (5%)

(2.) Cezar works in a car manufacturing company owned by Joab. Cezar is

quite innovative and loves to tinker with things. With the materials and parts
of the car, he was able to invent a gas-saving device that will enable cars to
consume less gas. Francis, a co-worker, saw how Cezar created the device
and likewise, came up with a similar gadget, also using scrap materials and
spare parts of the company. Thereafter, Francis filed an application for
registration of his device with the Bureau of Patents. Eighteen months later,
Cezar filed his application for the registration of his device with the Bureau of
Patents.

a) Is the gas-saving device patentable? Explain. b) Assuming that it is

patentable, who is entitled to the patent?

What, if any, is the remedy of the losing party?

c) Supposing Joab got wind of the inventions of his employees and also laid
claim to the patents, asserting that Cezar and Francis were using his
materials and company time in making the devices, will his claim prevail
over those of his employees? Explain. (5%)

CRIMINAL LAW

-I-

(1.) Distinguish the following from each other:cralaw

a) Complex crime under Article 48 of the Revised Penal Code;

b) Special complex crime; and

c) delito continuado. (3%)

(2.) Under Article 27 of the Revised Penal Code, as amended by Republic Act
(RA) No. 7959, reclusion perpetua shall be from 20 years and 1 day to 40
years.

Does this mean that reclusion perpetua is now a divisible penalty? Explain.
(2%)
(3.) Distinguish pecuniary penalties from pecuniary liabilities. (2%)

(4.) Taking into account the nature and elements of the felonies of coup d
etat and rape, may one be criminally liable for frustrated coup d etat or
frustrated rape? Explain. (2%)

(5.) Distinguish malum in se from malum prohibitum. (2%)

- II -

(1.) Belle saw Gaston stealing the prized cock of a neighbor and reported him
to the police. Thereafter, Gaston, while driving a car saw Belle crossing the
street. Incensed that Belle had reported him, Gaston decided to scare her by
trying to make it appear that he was about to run her over. He revved the
engine of his car and drove towards her but he applied the brakes. Since the
road was slippery at that time, the vehicle skidded and hit Belle causing her
death.

What is the liability of Gaston? Why? (4%)

(2.) DD was engaged in the warehouse business. Sometime in November

2004, he was in dire need of money. He, thus, sold merchandise deposited in
his warehouse to VR for P500,000.00. DD was charged with theft, as
principal, while VR as accessory. The court convicted DD of theft but
acquitted VR on the ground that he purchased the merchandise in good faith.
However, the court ordered VR to return the merchandise to the owner
thereof and ordered DD to refund the P500,000.00 to VR.

DD moved for the reconsideration of the decision insisting that he should be

acquitted of theft because being the depositary, he had juridical possession
of the merchandise. VR also moved for the reconsideration of the decision
insisting that since he was acquitted of the crime charged, and that he
purchased the merchandise in good faith, he is not obligated to return the
merchandise to its owner.

Rule on the motions with reasons. (5%)

- III -

(1.) Harold was convicted of a crime defined and penalized by a special penal
law where the imposable penalty is from 6 months, as minimum, to 3 years,
as maximum. State with reasons whether the court may correctly impose the
following penalties:cralaw

a) a straight penalty of 10 months;

b) 6 months, as minimum, to 11 months, as maximum;

c) a straight penalty of 2 years. (5%)

(2.) E and M are convicted of a penal law that imposes a penalty of fine or
imprisonment or both fine and imprisonment. The judge sentenced them to
pay the fine, jointly and severally, with subsidiary imprisonment in case of
insolvency.

a) Is the penalty proper? Explain.

b) May the judge impose an alternative penalty of fine or imprisonment?

Explain. (4%)

(3.) The accused was found guilty of 10 counts of rape for having carnal
knowledge with the same woman. In addition to the penalty of
imprisonment, he was ordered to pay indemnity in the amount of P50,000.00
for each count.

On appeal, the accused questions the award of civil indemnity for each
count, considering that the victim is the same woman. How would you rule
on the contention of the accused? Explain. (3%)
- IV -

(1.) Maganda was charged with violation of the Bouncing Checks Law (BP 22)
punishable by imprisonment of not less than 30 days but not more than 1
year or a fine of not less than but not more than double the amount of the
check, which fine shall not exceed P200,000.00, or both. The court convicted
her of the crime and sentenced her to pay a fine of P50,000.00 with
subsidiary imprisonment in case of insolvency, and to pay the private
complainant the amount of the check. Maganda was unable to pay the fine
but filed a petition for probation. The court granted the petition subject to
the condition, among others, that she should not change her residence
without the courts prior approval.

a) What is the proper period of probation?

b) Supposing before the Order of Discharge was issued by the court but after
the lapse of the period of probation, Maganda transferred residence without
prior approval of the court.

May the court revoke the Order of Probation and order her to serve the
subsidiary imprisonment? Explain. (5%)

(2.) DD purchased a television set for P50,000.00 with the use of a

counterfeit credit card. The owner of the establishment had no inkling that
the credit card used by DD was counterfeit.

What crime or crimes did DD commit? Explain. (5%)

-V-

Paz Masipag worked as a housemaid and yaya of the one-week old son of the
spouses Martin and Pops Kuripot. When Paz learned that her 70 year-old
mother was seriously ill, she asked Martin for a cash advance of P1,000.00
but Martin refused. One morning, Paz gagged the mouth of Martins son with
stockings; placed the child in a box; sealed it with masking tape and placed
the box in the attic. Later in the afternoon, she demanded P5,000.00 as
ransom for the release of his son. Martin did not pay the ransom.
Subsequently, Paz disappeared. After a couple of days, Martin discovered the
box in the attic with his child already dead. According to the autopsy report,
the child died of asphyxiation barely three minutes after the box was sealed.

What crime or crimes did Paz commit? Explain. (5%)

- VI -

Candido stabbed an innocent bystander who accidentally bumped him. The

innocent bystander died as a result of the stabbing. Candido was arrested
and was tested to be positive for the use of shabu at the time he
committed the stabbing.

What should be the proper charge against Candido? Explain. (3%)

- VII -

Jose employed Mario as gardener and Henry as cook. They learned that Jose
won P500,000.00 in the lotto, and decided to rob him. Mario positioned
himself about 30 meters away from Joses house and acted as lookout. For
his part, Henry surreptitiously gained entry into the house and killed Jose
who was then having his dinner. Henry found the P500,000.00 and took it.
Henry then took a can of gasoline from the garage and burned the house to
conceal the acts. Mario and Henry fled, but were arrested around 200 meters
away from the house by alert barangay tanods. The tanods recovered the
P500,000.00.

Mario and Henry were charged with and convicted of robbery with homicide,
with the aggravating circumstances of arson, dwelling, and nighttime. Mario
moved to reconsider the decision maintaining that he was not at the scene of
the crime and was not aware that Henry killed the victim; hence, he was
guilty only of robbery, as an accomplice. Mario also claimed that he
conspired with Henry to commit robbery but not to kill Jose. Henry, likewise,
moved to reconsider the decision, asserting that he is liable only for
attempted robbery with homicide with no aggravating circumstance,
considering that he and Mario did not benefit from the P500,000.00. He
further alleged that arson is a felony and not an aggravating circumstance;
dwelling is not aggravating in attempted robbery with homicide; and
nighttime is not aggravating because the house of Jose was lighted at the
time he was killed.

Resolve with reasons the respective motions of Mario and Henry. (7%)

- VIII -

Pete, a security guard, arrived home late one night after rendering overtime.
He was shocked to see Flor, his wife, and Benjie, his best friend, completely
naked having sexual intercourse. Pete pulled out his service gun and shot
and killed Benjie. Pete was charged with murder for the death of Benjie. Pete
contended that he acted in defense of his honor and that, therefore, he
should be acquitted of the crime. The court found that Benjie died under
exceptional circumstances and exonerated Pete of the crime, but sentenced
him to destierro, conformably with Article 247 of the Revised Penal Code. The
court also ordered Pete to pay indemnity to the heirs of the victim in the
amount of P50,000.00.

a) Is the defense of Pete meritorious? Explain.

b) Under Article 247 of the Revised Penal Code, is destierro a penalty?

Explain. c) Did the court correctly order Pete to pay indemnity despite his
exoneration under Article 247 of the Revised Penal Code? Explain. (5%)

- IX -

Allan, the Municipal Treasurer of the Municipality of Gerona, was in a hurry to

return to his office after a day-long official conference. He alighted from the
government car which was officially assigned to him, leaving the ignition key
and the car unlocked, and rushed to his office. Jules, a bystander, drove off
with the car and later sold the same to his brother, Danny for P20,000.00,
although the car was worth P800,000.00.

a) What are the respective crimes, if any, committed by Allan, Danny and
Jules? Explain.

b) What, if any, are their respective civil liabilities? Explain. (5%)

-X-

During a PNP buy-bust operation, Cao Shih was arrested for selling 20 grams
of methamphetamine hydrochloride (shabu) to a poseur-buyer. Cao Shih,
through an intermediary, paid Patrick, the Evidence Custodian of the PNP
Forensic Chemistry Section, the amount of P500,000.00 in consideration for
the destruction by Patrick of the drug. Patrick managed to destroy the drug.

State with reasons whether Patrick committed the following crimes:cralaw

a) Direct bribery;

b) Indirect bribery;

c) Section 3(e) of RA 3019 (Anti-Graft and Corrupt Practices Act);

d) Obstruction of Justice under PD 1829; (7%)

- XI -

On July 1, 2004, Jet Matulis, a pedophile, gave P1,000.00 to Sherly, an

orphan and a prostitute, and brought her to a motel. He inserted a rusty and
oversized vibrator into her vagina with such force that she bled profusely. Jet
panicked and fled. Sherly was brought to the hospital and died a few days
later because of shock caused by hemorrhage.

a) What crime or crimes did Jet Matulis commit? Explain.

b) If Sherly were a minor when she died, would your answer be the same?
Explain. (5%)

- XII -

Don Gabito, a philanthropist, offered to fund several projects of the Mayor.

He opened an account in the Mayors name and regularly deposited various
amounts ranging from P500,000.00 to P1 Million. From this account, the
Mayor withdrew and used the money for constructing feeder roads, barangay
clinics, repairing schools and for all other municipal projects. It was
subsequently discovered that Don Gabito was actually a jueteng operator
and the amounts he deposited were proceeds from his jueteng operations.

What crime/s were committed?

Who are criminally liable? Explain. (6%)

- XIII -

Obie Juan is suspected to have in his possession an unspecified amount of

methamphetamine hydrochloride or shabu. An entrapment operation was
conducted by police officers, resulting in his arrest following the discovery of
100 grams of the said dangerous drug in his possession. He was subjected to
a drug test and was found positive for the use of marijuana, another
dangerous drug. He was subsequently charged with two crimes: Violation of
Section 11, Article II of RA 9165 for the possession of shabu and violation
of Section 15, Article II of RA 9165 for the use of marijuana.
a) Are the charges proper? Explain.

b) So as not to be sentenced to death, Obie Juan offers to plead guilty to a

lesser offense. Can he do so? Why? (5%)

- XIV -

Al Chua, a Chinese national, filed a petition under oath for naturalization,

with the Regional Trial Court of Manila. In his petition, he stated that he is
married to Leni Chua; that he is living with her in Sampaloc, Manila; that he
is of good moral character; and that he has conducted himself in an
irreproachable manner during his stay in the Philippines. However, at the
time of the filing of the petition, Leni Chua was already living in Cebu, while
Al was living with Babes Toh in Manila, with whom he has an amorous
relationship. After his direct testimony, Al Chua withdrew his petition for
naturalization.

What crime or crimes, if any, did Al Chua commit? Explain. (5%)

- XV -

In an interview aired on television, Cindee uttered defamatory statements

against Erika, a successful and reputable businesswoman.

What crime or crimes did Cindee commit? Explain. (3%)

REMEDIAL LAW

-I-
a) Under Article 1144 of the New Civil Code, an action upon a judgment must
be brought within 10 years from the time the right of action accrues. Is this
provision applicable to an action filed in the Philippines to enforce a foreign
judgment? Explain.

b) May the aggrieved party file a petition for certiorari in the Supreme Court
under Rule 65 of the 1997 Rules of Civil Procedure instead of filing a petition
for review on certiorari under Rule 45 thereof for the nullification of a
decision of the Court of Appeals in the exercise either of its original or
appellate jurisdiction? Explain.

c) May a private document be offered and admitted in evidence both as

documentary evidence and as object evidence? Explain.

d) Distinguish a derivative suit from a class suit.

e) When may the trial court order that the testimony of a child be taken by
live-link television? Explain. (10%)

- II -

(1.) While Marietta was in her place of work in Makati City, her estranged
husband Carlo barged into her house in Paraaque City, abducted their six-
year old son, Percival, and brought the child to his hometown in Baguio City.
Despite Mariettas pleas, Carlo refused to return their child. Marietta, through
counsel, filed a petition for habeas corpus against Carlo in the Court of
Appeals in Manila to compel him to produce their son before the court and
for her to regain custody. She alleged in the petition that despite her efforts,
she could no longer locate her son.

In his comment, Carlo alleged that the petition was erroneously filed in the
Court of Appeals as the same should have been filed in the Family Court in
Baguio City which, under Republic Act No. 8369, has exclusive jurisdiction
over the petition. Marietta replied that under Rule 102 of the Rules of Court,
as amended, the petition may be filed in the Court of Appeals and if granted,
the writ of habeas corpus shall be enforceable anywhere in the Philippines.
Whose contention is correct? Explain. (5%)

(2.) Under Republic Act No. 8353, one may be charged with and found guilty
of qualified rape if he knew on or before the commission of the crime that he
is afflicted with Human Immuno-Deficiency Virus (HIV)/Acquired Immune
Deficiency Syndrome (AIDS) or any other sexually transmissible disease and
the virus or disease is transmitted to the victim.

Under Section 17(a) of Republic Act No. 8504 the court may compel the
accused to submit himself to a blood test where blood samples would be
extracted from his veins to determine whether he has HIV.

a) Are the rights of the accused to be presumed innocent of the crime

charged, to privacy, and against self-incrimination violated by such
compulsory testing? Explain.

b) If the result of such test shows that he is HIV positive, and the prosecution
offers such result in evidence to prove the qualifying circumstance under the
Information for qualified rape, should the court reject such result on the
ground that it is the fruit of a poisonous tree? Explain. (8%)

- III -

Perry is a resident of Manila, while Ricky and Marvin are residents of

Batangas City. They are the co-owners of a parcel of residential land located
in Pasay City with an assessed value of P100,000.00. Perry borrowed
P100,000.00 from Ricky which he promised to pay on or before December 1,
2004. However, Perry failed to pay his loan. Perry also rejected Ricky and
Marvins proposal to partition the property.

Ricky filed a complaint against Perry and Marvin in the Regional Trial Court of
Pasay City for the partition of the property. He also incorporated in his
complaint his action against Perry for the collection of the latters
P100,000.00 loan, plus interests and attorneys fees.

State with reasons whether it was proper for Ricky to join his causes of action
in his complaint for partition against Perry and Marvin in the Regional Trial
Court of Pasay City. (5%)

- IV -

Raphael, a warehouseman, filed a complaint against V Corporation, X

Corporation and Y Corporation to compel them to interplead. He alleged
therein that the three corporations claimed title and right of possession over
the goods deposited in his warehouse and that he was uncertain which of
them was entitled to the goods. After due proceedings, judgment was
rendered by the court declaring that X Corporation was entitled to the goods.
The decision became final and executory.

Raphael filed a complaint against X Corporation for the payment of

P100,000.00 for storage charges and other advances for the goods. X
Corporation filed a motion to dismiss the complaint on the ground of res
judicata. X Corporation alleged that Raphael should have incorporated in his
complaint for interpleader his claim for storage fees and advances and that
for his failure he was barred from interposing his claim. Raphael replied that
he could not have claimed storage fees and other advances in his complaint
for interpleader because he was not yet certain as to who was liable
therefor.

Resolve the motion with reasons. (4%)

-V-

(1.) After Lulus death, her heirs brought her last will to a lawyer to obtain
their respective shares in the estate. The lawyer prepared a deed of partition
distributing Lulus estate in accordance with the terms of her will. Is the act
of the lawyer correct? Why? (2%)

(2.) Nestor died intestate in 2003, leaving no debts. How may his estate be
settled by his heirs who are of legal age and have legal capacity? Explain.
(2%)
(3.) State the rule on venue in judicial settlement of estate of deceased
persons. (2%)

- VI -

While cruising on a highway, a taxicab driven by Mans hit an electric post. As

a result thereof, its passenger, Jovy, suffered serious injuries. Mans was
subsequently charged before the Municipal Trial Court with reckless
imprudence resulting in serious physical injuries.

Thereafter, Jovy filed a civil action against Lourdes, the owner of the taxicab,
for breach of contract, and Mans for quasi-delict. Lourdes and Mans filed a
motion to dismiss the civil action on the ground of litis pendentia, that is, the
pendency of the civil action impliedly instituted in the criminal action for
reckless imprudence resulting in serious physical injuries.

Resolve the motion with reasons. (4%)

- VII -

Katy filed an action against Tyrone for collection of the sum of P1 Million in
the Regional Trial Court, with an ex-parte application for a writ of preliminary
attachment. Upon posting of an attachment bond, the court granted the
application and issued a writ of preliminary attachment.

Apprehensive that Tyrone might withdraw his savings deposit with the bank,
the sheriff immediately served a notice of garnishment on the bank to
implement the writ of preliminary attachment. The following day, the sheriff
proceeded to Tyrones house and served him the summons, with copies of
the complaint containing the application for writ of preliminary attachment,
Katys affidavit, order of attachment, writ of preliminary attachment and
attachment bond.

Within fifteen (15) days from service of the summons, Tyrone filed a motion
to dismiss and to dissolve the writ of preliminary attachment on the following
grounds: (i) the court did not acquire jurisdiction over his person because the
writ was served ahead of the summons; (ii) the writ was improperly
implemented; and (iii) said writ was improvidently issued because the
obligation in question was already fully paid.

Resolve the motion with reasons. (4%)

- VIII -

In a complaint for recovery of real property, the plaintiff averred, among

others, that he is the owner of the said property by virtue of a deed of sale
executed by the defendant in his favor. Copy of the deed of sale was
appended to the complaint as Annex A thereof.

In his unverified answer, the defendant denied the allegation concerning the
sale of the property in question, as well as the appended deed of sale, for
lack of knowledge or information sufficient to form a belief as to the truth
thereof.

Is it proper for the court to render judgment without trial? Explain. (4%)

- IX -

On May 12, 2005, the plaintiff filed a complaint in the Regional Trial Court of
Quezon City for the collection of P250,000.00. The defendant filed a motion
to dismiss the complaint on the ground that the court had no jurisdiction
over the action since the claimed amount of P250,000.00 is within the
exclusive jurisdiction of the Metropolitan Trial Court of Quezon City.

Before the court could resolve the motion, the plaintiff, without leave of
court, amended his complaint to allege a new cause of action consisting in
the inclusion of an additional amount of P200,000.00, thereby increasing his
total claim to P450,000.00. The plaintiff thereafter filed his opposition to the
motion to dismiss, claiming that the Regional Trial Court had jurisdiction over
his action.

Rule on the motion of the defendant with reasons. (4%)

-X-

A obtained a money judgment against B. After the finality of the decision, the
court issued a writ of execution for the enforcement thereof. Conformably
with the said writ, the sheriff levied upon certain properties under Bs name.
C filed a third-party claim over said properties claiming that B had already
transferred the same to him.

A moved to deny the third-party claim and to hold B and C jointly and
severally liable to him for the money judgment alleging that B had
transferred said properties to C to defraud him (A).

After due hearing, the court denied the third-party claim and rendered an
amended decision declaring B and C jointly and severally liable to A for the
money judgment.

Is the ruling of the court correct? Explain. (4%)

- XI -

Helen is the daughter of Eliza, a Filipina, and Tony, a Chinese, who is married
to another woman living in China. Her birth certificate indicates that Helen is
the legitimate child of Tony and Eliza and that she is a Chinese citizen.

Helen wants her birth certificate corrected by changing her filiation from
legitimate to illegitimate and her citizenship from Chinese to Filipino
because her parents were not married.

What petition should Helen file and what procedural requirements must be
observed? Explain. (5%)

- XII -
Mariano was convicted by the Regional Trial Court for raping Victoria and
meted the penalty of reclusion perpetua. While serving sentence at the
National Penitentiary, Mariano and Victoria were married. Mariano filed a
motion in said court for his release from the penitentiary on his claim that
under Republic Act No. 8353, his marriage to Victoria extinguished the
criminal action against him for rape, as well as the penalty imposed on him.
However, the court denied the motion on the ground that it had lost
jurisdiction over the case after its decision had become final and executory.

a) Is the ruling of the court correct? Explain.

b) What remedy/remedies should the counsel of Mariano take to secure his

proper and most expeditious release from the National Penitentiary? Explain.
(7%)

- XIII -

Rodolfo is charged with possession of unlicensed firearms in an Information

filed in the Regional Trial Court. It was alleged therein that Rodolfo was in
possession of two unlicensed firearms: a .45 caliber and a .32 caliber.

Under Republic Act No. 8294, possession of an unlicensed .45 caliber gun is
punishable by prision mayor in its minimum period and a fine of P30,000.00,
while possession of an unlicensed .32 caliber gun is punishable by prision
correccional in its maximum period and a fine of not less than P15,000.00.

As counsel of the accused, you intend to file a motion to quash the

Information. What ground or grounds should you invoke? Explain. (4%)

- XIV -

Police operatives of the Western Police District, Philippine National Police,

applied for a search warrant in the Regional Trial Court for the search of the
house of Juan Santos and the seizure of an undetermined amount of shabu.

The team arrived at the house of Santos but failed to find him there. Instead,
the team found Roberto Co. The team conducted a search in the house of
Santos in the presence of Roberto Co and barangay officials and found ten
(10) grams of shabu. Roberto Co was charged in court with illegal possession
of ten grams of shabu.

Before his arraignment, Roberto Co filed a motion to quash the search

warrant on the following grounds:cralaw

(a) he was not the accused named in the search warrant; and

(b) the warrant does not describe the article to be seized with sufficient
particularity. Resolve the motion with reasons. (4%)

- XV -

For the multiple stab wounds sustained by the victim, Noel was charged with
frustrated homicide in the Regional Trial Court. Upon arraignment, he entered
a plea of guilty to said crime. Neither the court nor the prosecution was
aware that the victim had died two days earlier on account of his stab
wounds.

Because of his guilty plea, Noel was convicted of frustrated homicide and
meted the corresponding penalty. When the prosecution learned of the
victims death, it filed within fifteen (15) days therefrom a motion to amend
the Information to upgrade the charge from frustrated homicide to
consummated homicide. Noel opposed the motion claiming that the
admission of the amended Information would place him in double jeopardy.

Resolve the motion with reasons. (4%)

- XVI -

Dencio barged into the house of Marcela, tied her to a chair and robbed her
of assorted pieces of jewelry and money. Dencio then brought Candida,
Marcelas maid, to a bedroom where he raped her. Marcela could hear
Candida crying and pleading: Huwag! Maawa ka sa akin! After raping
Candida, Dencio fled from the house with the loot. Candida then untied
Marcela and rushed to the police station about a kilometer away and told
Police Officer Roberto Maawa that Dencio had barged into the house of
Marcela, tied the latter to a chair and robbed her of her jewelry and money.
Candida also related to the police officer that despite her pleas, Dencio had
raped her. The policeman noticed that Candida was hysterical and on the
verge of collapse. Dencio was charged with robbery with rape. During the
trial, Candida can no longer be located.

a) If the prosecution presents Police Officer Roberto Maawa to testify on what

Candida had told him, would such testimony of the policeman be hearsay?
Explain.

b) If the police officer will testify that he noticed Candida to be hysterical and
on the verge of collapse, would such testimony be considered as opinion,
hence, inadmissible? Explain. (8%)

- XVII -

Explain briefly whether the Regional Trial Court may, motu proprio, take
judicial notice of the following:cralaw

a) The street name of methamphetamine hydrochloride is shabu;

b) Ordinances approved by municipalities under its territorial jurisdiction;

c) Foreign laws;
d) Rules and Regulations issued by quasi-judicial bodies implementing
statutes;

e) Rape may be committed even in public places. (5%)

- XVIII -

Regional Director AG of the Department of Public Works and Highways was

charged with violation of Section 3(e) of Republic Act No. 3019 in the Office
of the Ombudsman. An administrative charge for gross misconduct arising
from the transaction subject matter of said criminal case was filed against
him in the same office. The Ombudsman assigned a team composed of
investigators from the Office of the Special Prosecutor and from the Office of
the Deputy Ombudsman for the Military to conduct a joint investigation of
the criminal case and the administrative case. The team of investigators
recommended to the Ombudsman that AG be preventively suspended for a
period not exceeding six (6) months on its finding that the evidence of guilt
is strong. The Ombudsman issued the said order as recommended by the
investigators.

AG moved to reconsider the order on the following grounds: (a) the Office of
the Special Prosecutor had exclusive authority to conduct a preliminary
investigation of the criminal case; (b) the order for his preventive suspension
was premature because he had yet to file his answer to the administrative
complaint and submit countervailing evidence; and (c) he was a career
executive service officer and under Presidential Decree No. 807 (Civil Service
Law), his preventive suspension shall be for a maximum period of three
months.

Resolve with reasons the motion of respondent AG. (5%)

LEGAL ETHICS AND PRACTICAL EXERCISES

-I-

Multiple choice. Choose the correct answer. Write the letter corresponding to
your answer.

(1.) Which of the following need not be verified?

a) Petition for Certiorari;

b) Interpleader;
c) Petition for Habeas Corpus;
d) Answer with compulsory counterclaim;
e) All pleadings under the Rules on Summary Procedure. (2%)

(2.) Which of the following statements is false?

a) All administrative cases against Justices of appellate courts and judges of

lower courts fall exclusively within the jurisdiction of the Supreme Court.

b) Administrative cases against erring Justices of the Court of Appeals and

Sandiganbayan, judges, and lawyers in the government service are not
automatically treated as disbarment cases.

c) The IBP Board of Governors may, motu proprio, or upon referral by the
Supreme Court or by a Chapter Board of Officers, or at the instance of any
person, initiate and prosecute proper charges against erring lawyers
including those in the government service.

d) The filing of an administrative case against the judge is not a ground for
disqualification/inhibition.

e) Trial courts retain jurisdiction over the criminal aspect of offenses

committed by justices of appellate courts and judges of lower courts. (2%)
(3.) On which of the following is a lawyer proscribed from testifying as a
witness in a case he is handling for a client:cralaw

a) On the mailing of documents;

b) On the authentication or custody of any instrument;

c) On the theory of the case;

d) On substantial matters in cases where his testimony is essential to the

ends of justice. (2%)

- II -

Mike Adelantado, an aspiring lawyer, disclosed in his petition to take the

2003 Bar Examinations that there were two civil cases pending against him
for nullification of contract and damages. He was thus allowed to
conditionally take the bar, and subsequently placed third in the said exams.

In 2004, after the two civil cases had been resolved, Mike Adelantado filed
his petition to take the Lawyers Oath and sign the Roll of Attorneys before
the Supreme Court. The Office of the Bar Confidant, however, had received
two anonymous letters: the first alleged that at the time Mike Adelantado
filed his petition to take the bar, he had two other civil cases pending against
him, as well as a criminal case for violation of Batas Pambansa (B.P.) Bilang
22; the other letter alleged that Mike Adelantado, as Sangguniang Kabataan
(SK) Chairperson, had been signing the attendance sheets of (SK) meetings
as Atty. Mike Adelantado.chanroblesvirtualawlibrary

a) Having passed the bar, can Mike Adelantado already use the appellation
attorney? Explain your answer. (3%)

b) Should Mike Adelantado be allowed to take his oath as a lawyer and sign
the Roll of Attorneys? Explain your answer. (3%)
- III -

Atty. Kuripot was one of Town Banks valued clients. In recognition of his
loyalty to the bank, he was issued a gold credit card with a credit limit of
P250,000.00. After two months, Atty. Kuripot exceeded his credit limit, and
refused to pay the monthly charges as they fell due. Aside from a collection
suit, Town Bank also filed a disbarment case against Atty. Kuripot.

In his comment on the disbarment case, Atty. Kuripot insisted that he did not
violate the Code of Professional Responsibility, since his obligation to the
bank was personal in nature and had no relation to his being a lawyer.

a) Is Atty. Kuripot correct? Explain your answer. (3%)

b) Explain whether Atty. Kuripot should be held administratively liable for his
refusal to settle his credit card bill. (3%)

- IV -

You had just taken your oath as a lawyer. The secretary to the president of a
big university offered to get you as the official notary public of the school.
She explained that a lot of students lose their Identification Cards and are
required to secure an affidavit of loss before they can be issued a new one.
She claimed that this would be very lucrative for you, as more than 30
students lose their Identification Cards every month. However, the secretary
wants you to give her one-half of your earnings therefrom.

Will you agree to the arrangement? Explain. (5%)

-V-
Judge Horacio would usually go to the cockpits on Saturdays for relaxation,
as the owner of the cockpit is a friend of his. He also goes to the casino once
a week to accompany his wife who loves to play the slot machines. Because
of this, Judge Horacio was administratively charged. When asked to explain,
he said that although he goes to these places, he only watches and does not
place any bets.

Is his explanation tenable? Explain. (5%)

- VI -

A businessman is looking for a new retainer. He approached you and asked

for your schedule of fees or charges. He informed you of the professional
fees he is presently paying his retainer, which is actually lower than your
rates. He said that if your rates are lower, he would engage your services.

Will you lower your rates in order to get the client? Explain. (5%)

- VII -

(1.) Judge Segotier is a member of Phi Nu Phi Fraternity. Atty. Nonato filed a
motion to disqualify Judge Segotier on the ground that the counsel for the
opposing party is also a member of the Phi Nu Phi Fraternity. Judge Segotier
denied the motion. Comment on his ruling. (5%)

(2.) In an intestate proceeding, a petition for the issuance of letters of

administration in favor of a Regional Trial Court Judge was filed by one of the
heirs. Another heir opposed the petition on the ground that the judge is
disqualified to become an administrator of the estate as he is the brother-in-
law of the deceased. Rule on the petition. (5%)

- VIII -
Due to the number of cases handled by Atty. Cesar, he failed to file a notice
of change of address with the Court of Appeals. Hence, he was not able to
file an appellants brief and consequently, the case was dismissed.
Aggrieved, Atty. Cesar filed a motion for reconsideration of the resolution
dismissing the appeal and to set aside the entry of judgment on the ground
that he already indicated in his Urgent Motion for Extension of Time to File
Appeal Brief his new address and that his failure to file a notice of change of
address is an excusable negligence.

Will the motion prosper? Explain. (5%)

- IX -

Darius is charged with the crime of murder. He sought Atty. Francias help
and assured the latter that he did not commit the crime. Atty. Francia agreed
to represent him in court. During the trial, the prosecution presented several
witnesses whose testimonies convinced Atty. Francia that her client is guilty.
She confronted his client who eventually admitted that he indeed committed
the crime. In view of his admission, Atty. Francia decided to withdraw from
the case.

Should Atty. Francia be allowed to do so? Explain. (5%)

-X-

Atty. Yabang was suspended as a member of the Bar for a period of one (1)
year. During the period of suspension, he was permitted by his law firm to
continue working in their office, drafting and preparing pleadings and other
legal documents but was not allowed to come into direct contact with the
firms clients. Atty. Yabang was subsequently sued for illegal practice of law.

Would the case prosper? Explain. (5%)

- XI -

Atty. Japzon, a former partner of XXX law firm, is representing Kapuso

Corporation in a civil case against Kapamilya Corporation whose legal
counsel is XXX law firm. Atty. Japzon claims that she never handled the case
of Kapamilya Corporation when she was still with XXX law firm.

Is there a conflict of interest? Explain. (5%)

- XII -

Pending before the sala of Judge Magbag is the case of CDG versus JQT. The
legal counsel of JQT is Atty. Ocsing who happens to be the brother of Atty.
Ferreras, a friend of Judge Magbag. While the case was still being heard, Atty.
Ferreras and his wife celebrated their wedding anniversary. They invited their
friends and family to a dinner party at their house in Forbes Park. Judge
Magbag attended the party and was seen conversing with Atty. Ocsing while
they were eating at the same table.

Comment on the propriety of Judge Magbags act. (5%)

- XIII -

Gerry Cruz is the owner of a 1,000-square meter lot covered by Transfer

Certificate of Title No. 12345 located in Sampaloc, Metro Manila. Gerry
decided to sell the property but did not have the time to look for a buyer. He
then designated his brother, Jon, to look for a buyer and negotiate the sale.
Jon met Angelo Santos who expressed his interest to buy the lot. Angelo
agreed to pay P1 Million for the property on September 26, 2005.

a) Draft the Special Power of Attorney to be executed by Gerry Cruz, as

principal, in favor of his brother Jon, as agent, authorizing the latter to sell
the property in favor of Angelo Santos. (7%)
b) Draft the Deed of Sale of Real Property. (7%)

- XIV -

Draft a withdrawal of counsel without conformity of client. (6%)

- XV -

Draft a Notice of Appeal. (6%) - XVI - Draft a Certification of Non-Forum

Shopping. (6%)