CIVREV QUIZ NO. 8
What is important
1. In express trust the acceptance by the
trustee is necessary for the creation of the
trust.
FALSE. Not necessary to its existence
and validity since if he declines, the courts will
appoint a trustee to fill the office that he
declines.
Art. 1445. No trust shall fail because the
trustee appointed declines the designation,
unless the contrary should appear in the
instrument constituting the trust
2. Acceptance by the beneficiary is not
necessary for the creation of an express
trust.
FALSE. Art. 1446. Acceptance by the
beneficiary is necessary. Nevertheless, if the
trust imposes no onerous condition upon the
beneficiary, his acceptance shall be presumed, if
there is no proof to the contrary.
3. Trustor may or may not have the capacity
to transfer the property.
FALSE. One of the requisites of a trust
is a competent trustor; hence, the trustor must
be capacitated to convey property. The property
must be in existence in which the trustor has a
trasferable interest or title
4. Express trust is created by the declaration
of the trustee that he holds the property in
trust .
FALSE. Art. 1444. No particular words
are required for the creation of an express trust,
it being sufficient that a trust is clearly intended.
It is created by the intention of the
parties. Technical or particular forms of words or
phrases are not essential to the manifestation of
an intention to create a trust.
is whether the trustor or the party manifested an
intention to create the kind of relationship which
in law is known as trust
5. Beneficiary is the person for whose benefit
the property is held by the trustee.
TRUE. The beneficiary or the cestui que
trust is the person who has the equitable interest
in the propertyand enjoys the benefit of
administration by the trustee
6. Trusts over real property are enforceable
in any form.
FALSE(?). By virtue of Art.1443, writing
is necessary to prove an express trust
concerning an immovable or any interest
therein. The writing is required by said article not
for validity, but for purposes of proof. Hence, by
analogy, this requirement may also be included
under the Statute of Frauds. (De Leon) --di ko
sure, sorry. Pa-construe nung last sentence from
De Leon. Thank you
7. Trustee can acquire the trust property by
adverse possession even without
repudiation of the trust.
FALSE
8. In order to bind third persons to a trust,
the same must be in public instrument.
TRUE
9. Statute of limitations applies to express
trusts.
FALSE
10. There is partnership when 2 or more
persons bind themselves to contribute
money, property, reputation(?) or industry to
a common fund with the intention of dividing
the profits among themselves.
TRUE
11. A contract of partnership may be
constituted in an form...
FALSE. A partnership may be
constituted in anyform, except where immovable
property or real rights are contributed thereto, in
which case a public instrumentshall be
necessary but not a private instrument. ( Article
1771, De Leon p. 62)
12. Husband and wife may duly enter into a
partnership for the purpose of a profession.
TRUE. ART. 1782 provides that persons
who are prohibited from giving each other any
donation or advantage cannot enter into a
universal partnership.A husband and his wife,
however, may enter into a particular partnership
or be members thereof. (see Commissioner of
Internal Revenue vs. Suter, 27 SCRA 152
[1969].) (De Leon, p.78)
13. The sharing of net returns may indicate
the existence of a partnership.
TRUE
14. A person who not being a partner in fact
allows his name to be included in the firm
name may subject himself to the liabilities of
a limited partner.
FALSE. Persons who, not being
partners, include their names in the firm name
do not acquire the rights of a partner (see Art.
1767.) but under Article 1815, they shall be
subject to the liability of a partner (Art. 1816.)
insofar as third persons without notice are
concerned. (see Jo Chung Cang vs. Pacifi c
Commercial Co., 45 Phil. 142 [1923]; Phil.
National Bank vs. Lo, 50 Phil. 803 [1927].) Such
persons become partners by estoppel. (Art.
1825.) They are liable as general partners. (De
Leon, p. 169)
15. Appraisal of goods contributed to the
partnership must be based on the value at
the time of the perfection of contract if
different from delivery.
FALSE. The appraisal is made, fi rstly,
in the manner prescribed by the contract of
partnership; secondly, in the absence of
stipulation, by experts chosen by the partners
and according to current prices.(De Leon, p. 95)
16. An industrial partner may engage himself
in any other business with the authority of
other partners.
TRUE. But the permission of the other
partners must be express.
17. When there is no specification as to the
management of the partnership, the partner
with the highest contribution becomes the
manager.
FALSE. If there is no designated
manager, all partners shall be considered agents
and whatever any one of them may do alone
shall bind the partnership. This is true regardless
of the amount of their capital contributions or
extent of their services to the partnership. (De
Leon)
18. The capitalist partners may exclude from
the partnership an industrial partner who
engages himself in a business without the
required authority even if the industrial
partner also contributed a parcel of land to
the partnership.
FALSE
19. A limited partner is a partner in a
partnership
TRUE. He is a partner subject to rights
and obligations of a partner only that his liability
to third persons is limited to his capital
contributions.
20. A limited partner who is also a general
partner is liable to the creditors of the
partnership only up to his contribution
FALSE. A person who is a general, and
also at the same time a limited partner, shall
have all the rights and powers and be subject to
all the restrictions of a general partner; except
that, in respect to his contribution, he shall have
the rights against the other members which he
would have had if he were not also a general
partner. (Art 1853)
21. Limited partnership is dissolved upon
retirement, death, insolvency, insanity or civil
interdiction of a general partner.
TRUE. The retirement, death,
insolvency, insanity or civil interdiction of a
general partner dissolves the partnership unless
the business is continued by the remaining
general partners under a right so to do stated in
the certitificate or with the consent of all
members. (Article 1860)
22. A contract of agency to sell personal
property is a real contract that would require
the delivery of the thing sold.
FALSE. Article 1316 provides that only
real contracts such as deposit, pledge and
commodatum require delivery of the object of
the obligation.
23. A partnership is formed even if no
inventory and public instrument of real
properties contributed to the partnership
was made.
FALSE. A contract of partnership is void
whenever immovable property is contributed
thereto, if an inventory of said property is not
made, signed by the parties, and attached to the
public instrument. (Article 1773)
24. Universal partnership of all present
property includes title to all present and
future property as well as future properties
acquired by gratuitious title.
FALSE. In a universal partnership of all
present property, the property which belong to
each partners at the time of the constitution of
the partnership, becomes the common property
of all the partners, as well as the profits which
they may acquire therewith. (Article 1779)
25. A contract of partnership with a capital of
3000 pesos must appear in a public
instrument and recorded with the SEC to be
enforceable.
FALSE
26. Those prohibited from giving each other
any donation or advantage is prohibited from
entering into any partnership.
FALSE. Prohibition only applies to
universal partnership. (Art. 1782)
27. A stipulation excluding an industrial
partner from any share in the profits or
losses is valid.
FALSE. It only applies in losses.
28. An industrial partner is exempt from
payment of liabilities to his creditors.
FALSE. All partners, including industrial
ones, shall be liable pro rata with all their
property for the contracts which may be entered
into in the name and for account of the
partnership. (Art. 1816)
29. A transfer of a partner’s entire interest in
the partnership to his only partner dissolves
the partnership.
FALSE. A conveyance by a partner of
his whole interest in the partnership does not of
itself dissolve the partnership. (Art. 1813)
30. In voluntary transfer of a partner’s
interest in the partnership, the assignee
becomes a partner _________ partners’
consent thereto (PRENS MALALA. DI KO
MABASA TALAGA)
(So let us assume the missing word is without)
FALSE. Their consent is needed for
assignee to become a partner
31. A person admitted as partner in an
already existing partnership is also liable
with his individual properties in all
obligations of the partnership arising before
his admission unless there is a contrary
stipulation.
FALSE. His liability shall be satisfied
only out of partnership property, i.e. out of his
share.
Article 1826. A person admitted as a
partner into an existing partnership is liable for
all the obligations of the partnership arising
before his admission as though he had been a
partner when such obligations were incurred,
except that this liability shall be satisfied only out
of partnership property, unless there is a
stipulation to the contrary. (n)
32. A commission agent cannot sell on credit
goods or items without the express or
implied consent of the principal.
TRUE. (By express provision. NOTE
HOWEVER that the provision states that in case
the agent does in fact sell on credit, it will only
give rise to the principal’s right to demand
payment in cash from the agent and the agent
will be entitled to any interest or benefit from
such sale. The sale is thus still valid. See 2006
JURADO REVIEWER, p. 1019)
Article 1905. The commission agent
cannot, without the express or implied consent
of the principal, sell on credit. Should he do so,
the principal may demand from him payment in
cash, but the commission agent shall be entitled
to any interest or benefit, which may result from
such sale. (n)
33. An agency ‘coupled with an interest’
survives the grantor’s death.
TRUE. (ASSUMING THAT GRANTOR
MEANS PRINCIPAL, AS THE ‘GRANTOR OF
THE AUTHORITY’)
Article 1930. The agency shall remain in
full force and effect even after the death of the
principal, if it has been constituted in the
common interest of the latter and of the agent,
or in the interest of a third person who has
accepted the stipulation in his favor. (n)
34. In case there are two or more principals,
any one of them may revoke the agency
provided the consent of the other is sought.
FALSE. Any one of them may revoke
the agency without need of the other’s consent.
Article 1925. When two or more
principals have granted a power of attorney for a
common transaction, any one of them may
revoke the same without the consent of the
others. (n)
35. Constructive trusts are imposed by the
law to carry out the actual or presumed
intent of the parties if the express trust is
prejudicial to the interest of the beneficiary.
FALSE. Constructive trusts arise
contrary to intention of the parties.
Constructive trusts are "created by the
construction of equity in order to satisfy the
demands of justice and prevent unjust
enrichment. They arise contrary to intention
against one who, by fraud, duress or abuse of
confidence, obtains or holds the legal right to
property which he ought not, in equity and good
conscience, to hold" (Crisostomo v. Garcia, G.R.
No. 164787, Jan. 31, 2006, citing Cuenco v.
Cuenco Vda. De Manguerra, G.R. No. 149844)
A constructive trust is a trust "raised by
construction of law, or arising by operation of
law". In a more restricted sense and as contra
distinguished from a resulting trust, a
constructive trust is "a trust not created by any
words, either expressly or impliedly evincing a
direct intention to create a trust, but by the
construction of equity in order to satisfy the
demands of justice. It does not arise by
agreement or intention but by operation of law."
(89 C.J.S. 7260727)(cited in Ramos v. Ramos,
G.R. No. L-19872, Dec. 3, 1974)
36. Resulting trust is established by law
regardless of the intention of the parties in
order to prevent fraud, oppression or unjust
enrichment.
FALSE. Resulting trust is one in which
the intention to create a trust is implied or
presumed in law. Constructive trust is the one
which is imposed by law regardless of the
intention of the parties to promote justice,
frustrate fraud and prevent unjust enrichment.
(De Leon, PAT, pp.626)
37. No express trust concerning an
immovable or any interest therein may be
proved by parole evidence.
TRUE. Article 1443. No express trust
concerning an immovable or any interest therein
may be proved by parole evidence.
However, like the defense of the status
of frauds, this defense may be waived by failure
to timely object against the presentation of oral
evidence no admissible under the law or by
cross-examining his witnesses along the
prohibited lines.
38. There is resulting trust when a donation
is made to a person but it appears that
although legal estate is transmitted to the
donee, he nevertheless is either to have no
beneficial interest or only a part thereof.
TRUE. (Villanueva, PAT, page 371) In
this situation, the donor is deemed to have
become the beneficiary under the implied
(resulting) trust .
39. There is a constructive trust when land
passes by succession to any person and he
causes the legal title thereto to be put in the
name of another.
FALSE. In case a person who acquires
land by succession causes the title to be put in
the name of another, a RESULTING TRUST is
created in favor of the true owner, the heir. There
is constructive trust only when through
fraudulent misrepresentations, an heir
succeeded in having the original title of the
deceased cancelled and a new one issued in his
name thus enabling him to possess land and get
its produce, in which case, the constructive trust
is created in favor of the defrauded. (De Leon,
PAT, pp. 664)
40. There is constructive trust if the price of
the sale of property is loaned or paid by one
person for the benefit of another and the
conveyance is made to the borrower but
mortgaged to secure payment of the debt.
FALSE. Constructive trust is created
when purchase of property leads to its title being
placed in the name of the person who loaned
the purchase price as a security for payment of
the debt and not when conveyance was made to
the borrower.
41. Laches is a defense in resulting trusts
unless the beneficiary had no knowledge of
the facts.
TRUE. The prescriptive period shall be
counted from the time the repudiation is made
known to the beneficiary.
42. In express trusts, the statute of
limitations does not apply in subsisting and
continuing trusts so long as there is no
denial or repudiation thereof.
TRUE.
43. The sharing of gross returns is sufficient
to establish partnership.
FALSE. Art. 1769 (3) The sharing of
gross returns does not of itself establish a
partnership, whether or not the persons sharing
them have a joint or common right or interest in
any property from which the returns are derived.
44. Special capacity to contract is required of
the parties to a contract of partnership.
FALSE. The presence of the essential
elements (Cause, Object, and Consideration)
and the legal capacity of the parties to enter in a
contract is sufficient.
45. When an unlawful partnership is
dissolved by a judicial decree, the profits
and unlawful objects shall be confiscated in
favor of the State.
TRUE. Art. 1770 (Par. 2) When an
unlawful partnership is dissolved by a judicial
decree, the profits shall be confiscated in favor
of the State, without prejudice to the provisions
of the Penal Code governing the confiscation of
the instruments and effects of a crime.
46. A partnership of all present property
comprises all that the partners may acquire
by the industry of work during the existence
of the partnership.
FALSE. Universal partnership of profits
and not all present property. Art. 1780. A
universal partnership of profits comprises all that
the partners may acquire by their industry or
work during the existence of the partnership.
47. In case of doubt, the articles of universal
partnership shall constitute a partnership of
all present property since it involve less
transmission of rights.
FALSE. It shall be considered universal
partnership of all profits not properties.
Art. 1781. Articles of universal
partnership, entered into without specification of
its nature, only constitute a universal partnership
of profits. (1676)
48. When a partnership for a fixed term or
particular undertaking is continued after the
termination of such term or particular
undertaking without any express agreement,
the rights and duties of the partners remain
the same as they were at such termination
for the same period as initially fixed in the
contract of partnership.
FALSE. Not always, only if it is
consistent with a partnership at will. (Art. 1785)
49. Important alterations in the immovable
property of partnership, if useful and
beneficial to the partnership, is by mere act
of administration and may be made upon the
financial majority.
FALSE. This is a strict act of dominion
which requires the consent of all.
50. Strangers are bound to inquire into the
existence of any restriction of authority on
the part of the partner.
FALSE. Every partner is an agent of the
partnership. No need to inquire so long as the
act of the partner is apparently for the carrying
on of business of the partnership in the usual
way which he is a member binds the partnership
(Art. 1818)
51. Misappropriation of one partner binds the
partnership when the partner in the course of
business receives money or property of a
third person and the money or property so
received is misapplied without the
knowledge of the other partners.
TRUE. Based on Article 1823 par. 1.
The knowledge of the other partners are
immaterial. Malabo ung question di ko mabasa
na maayos. Please Check.
52. If a person specially informs another or
states by public advertisement that he has
given a power of attorney to a third person,
the holder thereby becomes a duly
authorized agent, in the former case with
respect to the person who received the
special information and in the latter case
with regard to any person even if the latter
did not read the publication when he
transacted with the agent.
TRUE
53. A special power of attorney is necessary
to make gifts for charity or to employees in
the business managed by the agent.
FALSE. Article 1878 provides that a
special power of attorney is needed to make
gifts, except customary ones for charity or those
made to employees in the business managed by
the agent.
54. A special power of attorney is necessary
to loan or borrow money, unless the latter act
be urgent and indispensable for the
improvement or preservation of the things
which are under administration.
FALSE
55. An agent may be relieved by agreement
from the obligation to make an accounting.
FALSE. The agreement is void based
on Article 1891. The agent has an absolute duty
to render an accounting to his principal of all
transactions and material facts that may have
some relevance with the agency. (Domingo vs
Domingo Gr. No. L-30573, 29 October 1971)
56. If the commission agent receives
guaranty commission in addition to ordinary
commission, the agent shall bear the risk of
collection and shall pay the principal the
proceeds of the sale on the same terms
agreed upon with the purchaser unless the
principal consented to the sale on credit.
FALSE. THE GENERAL RULE WILL
STILL APPLY EVEN IN CONSENTED SALE ON
CREDIT. Art. 1907 – Should the commission
agent receive on sale, in addition to the ordinary
commission, another called guarantee
commission, he shall bear the risk of collection
and shall pay the principal the proceeds of the
sale on the same terms agreed upon with the
purchaser. According to De Leon (PAT, 2010),
Art. 1907 applies to both cash and credit sales
because it makes no distinction. Dapat wala
yung “unless the principal consented to the sale
on credit.” 1907 will still apply in credit sales.
57. If the third person does not know that the
agent exceeded the scope of his authority, he
may hold the agent liable as well as the
principal, even if he has not inquired into the
authority of the agent.
FALSE. Art. 1898 – If the agent
contracts in the name of the principal, exceeding
the scope of his authority, and the principal does
not ratify the contract, it shall be void if the party
with whom the agent contracted is aware of the
limits of the powers granted by the principal. In
this case, however, the agent is liable if he
undertook to secure the principal’s ratification. I
THINK
the 3rd person may hold the agent
liable as he is not aware of the limits of the
agent’s power; however, the contract remains
unenforceable against the principal who did not
ratify (correlate with Art. 1317 – unenforceability
of contracts if entered into in the name of
another who has acted beyond his powers,
unless ratified by the person on whose behalf it
has been executed.) THIS IS JUST MY
OPINION.
58. Agency by ostensible authority consists
in the conscious permission of acts beyond
those powers granted.
TRUE. Apparent authority is founded in
conscious permission of acts beyond the powers
granted (UST GOLDEN NOTES 2011).
59. If two or more principals have appointed
an agent for a common transaction or
undertaking, they are jointly liable unless
solidarity is agreed upon.
FALSE. THEY ARE SOLIDARILY
LIABLE. Art. 1915 – If two or more persons have
appointed an agent for a common transaction or
undertaking, they shall be solidarily liable to the
agent for all the consequences of the agency.
(Compare this with Art. 1894. If two or more
AGENTS have been appointed, the liability is
not solidary, if solidarity has not been expressly
stipulated.)
60. An agency is not revoked by the
principal’s death if it has been constituted in
the interest of a third person without notice
or knowledge of the interest.
FALSE. AGENCY WILL SURVIVE
ONLY IF THE THIRD PERSON ACCEPTED
THE STIPULATION IN HIS FAVOR. Thus, it
should be with notice or upon knowledge of the
interest. Art. 1930 – The agency shall remain in
full force and effect even after the death of the
principal, if it has been constituted in the
common interest of the latter and of the agent,
or in the interest of a third person who has
accepted the stipulation in his favor.
61. An oral trust is sufficient in case of trust
over personalty.
TRUE. Basis: Article 1443 of the Civil
Code provides that “No express trusts
converning an immovable or any interest therein
may be proved by parol evidence.” The clear
legal implication of the language of Article 1443
is that an express trust concerning movables or
any interests therein may be proved by parol
evidence; which means that the mere meeting of
minds over the creation of an express trust over
movables creates a valid and enforceable
contract of trust once the movable is delivered to
the trustee.
62. In case of an impossible trust the court
may authorize deviation in the interest of the
trust.
FALSE
63. There is no need for the trustee to render
an account under oath.
TRUE. The trustee has the duty to
account to the beneficiary for the affairs of the
trust and he cannot convert the use of the trust
properties, and the incomes, fruits and proceeds
for his own benefit. Every trustee has the
common law duty of loyalty.
Under Rule 98 of the Rules of Court,
one of the duties of the trustee appointed by the
court is to render upon oath at least once a year
until his trust is fulfilled, unless he is excused
therefrom in any year by the court, a true
account of the property in his hands and of the
management and disposition thereof, and will
render such other account as the court may
order.
64. The trustor cannot prohibit alienation for
a period more than 25 years.
TRUE
65. Merger is a cause for the termination of
an implied or express trust.
TRUE
66. In an implied trust, the action to recover
must be brought within 5 years from the
issuance of title to the property.
FALSE. An action for the reconveyance
of land based on implied or constructive trust
prescribes within 10 years. (Pangan v CA 1988;
De Leon, p. 647)
67. A partner may transfer his interest to
another over the objection of other partners.
TRUE. A partner may assign his interest
in the partnership to a co-partner or third person
without the consent of the other partners, in the
absence of agreement to the contrary. (De Leon,
p. 158)
68. A secret and silent partner is one who
has no voice in the management of the
partnership and is not known to the partners.
FALSE. He is not known to be a partner
by outside parties nor held out as a partner by
the other partners. (De Leon, p. 73)
69. The partnership begins from the moment
it is recorded in the SEC.
FALSE. A partnership begins from the
moment of the execution of the contract, unless
it is otherwise stipulated. (Art 1784)
70. The fruits to the property promised to be
delivered should also be delivered without
exception.
FALSE
71. In case of imminent loss of the business
of the partnership, an industrial partner shall
be required to contribute additional service
to the partnership.
FALSE. All the other partners are the
ones required to contribute additional capital
under such circumstance. The industrial partner
is explicitly excluded to render additional
service. (Art. 1791, Civil Code)
72. An industrial partner can engage in other
business but must not compete with the
partnership, unless otherwise stipulated.
FALSE. An industrial partner cannot
engage in business for himself, unless the
partnership expressly permits him to do so. (Art.
1789, Civil Code)
73. A partner, as agent, cannot assign
partnership property in payment of
partnership debt.
FALSE
74. Dissolution terminates the partnership.
FALSE. The partnership, although
dissolved, continues to exist until its termination,
at which time the winding up of its affairs should
have been completed and the net partnership
assets are partitioned and distributed to the
partners (Ortega, et al. vs. CA, G.R. No.
109248, July 3, 1995; p. 408, Memaid 2015). FALSE. Basis: 1845. The contributions
of a limited partner may be cash or property, but
75. Insolvency of a partner is one of the not services.
causes for voluntary dissolution of a
partnership.
80. A limited partner’s surname may appear
FALSE in the partnership name but he becomes a
general person with respect to the partners
and third parties.
76. In case of an agreement between a
partner, the partnership debtors and the FALSE
persons continuing the business, a partner
may be discharged from liabilities.
81. A substituted partner is one admitted to
FALSE. Basis: 1835. A partner is all the rights of a limited partner.
discharged from any existing liability upon the
dissolution of the partnership by an agreement TRUE
to that effect between himself, the partnership
creditor and the person or partnership continuing
the business;
82. An assignee of a limited partner acquires
the rights of the assignor.
77. Creditors of the old partnership are no
longer considered as creditors of the TRUE
continued partnership.

FALSE. Basis: [De Leon, 2010 p. 265,
citing Yu v. NLRC] “In such case, the law makes
the creditors of the dissolved partnership also
creditors of the persons or partnership
continuing the business. xxx It is immaterial to
determine under which one or more of the six
cases mentioned in Article 1840 the dissolution
falls – the creditors of the old partnership are
also the creditors of the new partnership which
continues the business of the old one without
liquidation of the partnership affairs.”
78. The individual property of a deceased
partner, whose name is being used by the
continuing partnership, shall be held liable
for debts contracted after his death.
FALSE. Basis: 1840 last par. “The last
paragraph of 1840 primarily deals with the
exemption from liability to creditors of a
dissolved partnership which continues the
business using the partnership name or the
name of the deceased partner as part thereof.”
[De Leon, 2010 p. 267]
79. A limited partner may contribute services
to the partnership.
83. An agent may be bound to render service
without compensation provided there is a
special power of attorney.
FALSE
84. In all cases, a special power of attorney is
necessary to loan or borrow money.
FALSE. It is not necessary if it is urgent
and indispensable for the preservation of the
things which are under administration. (Art.
1878(7))
85. A special power to compromise
authorizes submission to arbitration.
FALSE. A special power to compromise
does not authorize submission to arbitration.
(Art. 1880)
86. There is an implied acceptance if the
principal delivers his power of attorney to
the agent and the latter receives it without
objection.
TRUE. Art. 1871 provides that Between
persons who are present, the acceptance of the
agency may also be implied if the principal
delivers his power of attorney to the agent and
the latter receives it without any objection.
89. An agency is gratuitous unless
compensation is agreed upon.
FALSE. Article 1875: Agency is
presumed to be for a compensation, unless
there is proof to the contrary.

87. An agent may be exempted from 90. The accomplishment of the object of the
rendering an accounting. agency extinguishes an agency even prior to
the final accounting.
FALSE. Art. 1891 provides that every
agent is bound to render an account of his TRUE. The accomplishment of the
transactions and to deliver to the principal object of the agency extinguishes an agency
whatever he may have received by virtue of the (p.434, 2015 Memaid)
agency, even though it may not be owing to the
principal. Every stipulation exempting the agent
from the obligation to render an account shall be
void (reason: it is contrary to public policy – 91. An agency at will is revoked even if the
memaid p.426). The agent has absolute duty to revocation is not brought to the knowledge
make a full disclosure or accounting to his of the agent.
principal of all transactions and material facts
that may have some relevance with the agency. FALSE.
However, the obligation to account is not
applicable: (1) in cases of solution indebiti; (2)
where a right of lien exists in favor of the agent, 92. When a partner by estoppel combines
the rule is also not applicable; (3) if the agent or with another partner and on the strength of
broker had informed the principal of the gift or representation, contracted with a third
bonus or profit he received from the purchaser person, both of them are liable pro rata.
and his principal did not object thereto; (4) if the
agent or broker acted only as a middleman with TRUE. Article 1825.
the task of merely bringing together the vendor
and the vendee, who themselves thereafter will
negotiate on the terms and conditions of the
transaction. (2015 Memaid, p.426)
93. A partner is a co-owner of the other
partners with respect to the undistributed net
profits of the partnership
88. If the principal does not mention the
power to substitute at all, the agent may
appoint one but he is responsible for the FALSE. Art 1811, refers only to specific
acts of the substitute. partnership property.

TRUE. Art. 1892: The agent may

appoint a substitute if the principal has not
prohibited him from doing so; but he shall be 94. Winding up may be done by mere
responsible for the acts of the substitute: (1) assignee in exceptional circumstances.
When he was not given the power to appoint
one; (2) When he was given such power, but FALSE
without designating the person, and the person
appointed was notoriously incompetent or
insolvent. All acts of the substitute appointed 95. A decree of dissolution of a partnership
against the prohibition of the principal shall be may be granted upon application of the
void.
purchaser of partnership interest in case of
termination of term or undertaking. 100. When partnership agreement is
rescinded on the ground of fraud or
TRUE. Art 1831. 2nd Par. On application misrepresentation, partners who are not
by or for a partner the court shall decree a guilty shall have the right to subrogation for
dissolution whenever: On the application of the any payments made by them of partnership
purchaser of a partner's interest under article liabilities.
1813 or 1814: (1) After the termination of the
specified term or particular undertaking; (2) At TRUE
any time if the partnership was a partnership at
will when the interest was assigned or when the
charging order was issued. (n)

96. Except as necessary for winding up,

dissolution terminates all authority of
partners to act for the partnership.

TRUE

97. After dissolution, a partner can bind the

partnership by any transaction which would
bind the partnership if dissolution had not
taken place, provided the other party to the
transaction had extended credit to the
partnership after dissolution.

FALSE.

98. Dissolution necessarily discharges a

partner of liability for obligations incurred
thereafter.

FALSE. Where a person enters into a

new contract with a third person after
dissolution, the new contract generally will bind
the partners. Each of them is liable for his sharr
of any liability created by the acting partner as if
the partnership had jot been dissolved (pg 235
de leon) Art1833

99. Unless otherwise agreed, the partners

who have not wrongfully dissolved the
partnership or the legal representative of the
last surviving insolvent partner, has the right
to wind up the partnership affairs, provided,
however, that any partner, his legal
representative or his assignee, upon cause
shown, may obtain winding up by the court.

FALSE. Art 1836. Not insolvent