Political Law-I- The contents of the vault of ABC company consisting of cash and documents were stolen. Paulyn, the treasurer of ABC, was invited by the Makati City Police Department to shed light on the amount of cash stolen and the details of the missing documents. Paulyn obliged and volunteered the information asked. Later, Paulyn was charged with qualified theft together with other suspects. Paulyn claims her rights under the Constitution and pertinent laws were blatantly violated. The police explained that they were just gathering evidence when Paulyn was invited for a conference and she was not a suspect at that time. Rule on her defense. (5%) -II- Sec. 11, Art. XII of the Constitution, provides: “No franchise, certificate or any other form of authorization for the operation of a public utility shall be granted except to citizens of the Philippines or to corporations or associations organized under the laws of the Philippines at least sixty per centum of whose capital is owned by such citizens xx x.” Does the term “capital” mentioned in the cited section refer to the total common shares only, or to the total outstanding capital stock, or to both or “separately to each class of shares, whether common, preferred non-voting, preferred voting or any class of shares?” Explain your answer. (5%) -III- A law converted the component city of Malumanay, Laguna into a highly urbanized city. The Local Government Code (LGC) provides that the conversion “shall take effect only after it is approved by the majority of votes cast in a plebiscite to be held in the political units directly affected.” Before the COMELEC, Mayor Xenon of Malumanay City insists that only the registered voters of the city should vote in the plebiscite because the city is the only political unit directly affected by the conversion. Governor Yuri asserts that all the registered voters of the entire province ofLaguna should participate in the plebiscite, because when the LGC speaks of the “qualified voters therein,” it means all the voters of all the political units affected by such conversion, and that includes all the voters of the entire province. He argues that the income, population and area of Laguna will be reduced. Who, between Mayor Xenon and Governor Yuri, is correct? Explain your answer. (5%) -IV- Several concerned residents of the areas fronting Manila Bay, among them a group of students who are minors,filed a suit against the Metro Manila Development Authority (MMDA), the Department of Environment and Natural Resources (DENR), the Department o f Health (DOH), the Department o f Agriculture (DA), the Department o f Education (DepEd), the Department o f Interior and Local Government (DILG), and a number of other executive agencies, asking the court to order them to perform their duties relating to the cleanup, rehabilitation and protection of Manila Bay. The complaint alleges that the continued neglect by defendants and their failure to prevent and abate pollution in Manila Bay constitute a violation of the petitioners’ constitutional right to life, health and a balanced ecology. [a] If the defendants assert that the students/petitioners who are minors do not have locus standi to file the action, is the assertion correct? Explain your answer. (2.5%) [b] In its decision which attained finality, the Court ordered the defendants to clean up, rehabilitate and sanitize Manila Bay within eighteen (18) months, and to submit to the Court periodic reports of their accomplishment, so that the Court can monitor and oversee the activities undertaken by the agencies in compliance with the Court’s directives. Subsequently, a resolution was issued extending the time periods within which the agencies should comply with the directives covered by the final decision. A view was raised that the Court’s continued intervention after the case has been decided violates the doctrine of separation of powers considering that the government agencies all belong to the Executive 1 Department and are under the control of the President. Is this contention correct? Why or why not? (2.5%) -V- Section 8 ofP.D. No. 910, entitled “Creating an Energy Development Board, defining its powers and functions, providing funds therefor and for other purposes,” provides that: “All fees, revenues and receipts of the Board from any and all sources x x x shall form part of a Special Fund to be used to finance energy resource development and exploitation programs and projects of the government and for such other purposes as may be hereafter directed by the President.” The Malampaya NGO contends that the provision constitutes an undue delegation of legislative power since the phrase “and for such other purposes as may be hereafter directed by the President” gives the President unbridled discretion to determine the purpose for which the funds will be used. On the other hand, the government urges the application of ejusdem generis. [a] Explain the “completeness test” and “sufficient standard test.” (2.5%) [b] Does the assailed portion of section 8 of PD 910 hurdle the two (2) tests? (2.5%) -VI- Pornographic materials in the form of tabloids, magazines and other printed materials, proliferate and are being sold openly in the streets of Masaya City. The City Mayor organized a task force which confiscated these materials. He then ordered that the materials be burned in public. Dominador, publisher of the magazine, “Plaything”, filed a suit, raising the following constitutional issues: (a) the confiscation of the materials constituted an illegal search and seizure, because the same was done without a valid search warrant; and (b) the confiscation, as well as the proposed destruction of the materials, is a denial of the right to disseminate information, and thus, violates the constitutional right to freedom of expression. Is either or both contentions proper? Explain your answer. (5%) -VII- Ernesto, a minor, while driving a motor vehicle, was stopped at a mobile checkpoint. Noticing that Ernesto is a minor, SPOl Jojo asked Ernesto to exhibit his driver’s license but Ernesto failed to produce it. SPOI Jojo requested Ernesto to alight from the vehicle and the latter acceded. Upon observing a bulge in the pants of Ernesto, the policeman frisked him and found an unlicensed .22-caliber pistol inside Ernesto’s right pocket. Ernesto was arrested, detained and charged. At the trial, Ernesto, through his lawyer, argued that, policemen at mobile checkpoints are empowered to conduct nothing more than a “visual search”. They cannot order the persons riding the vehicle to alight. They cannot frisk, or conduct a body search of the driver or the passengers of the vehicle. Ernesto’s lawyer thus posited that: [a] The search conducted in violation of the Constitution and established jurisprudence was an illegal search; thus, the gun which was seized in the course of an illegal search is the “fruit of the poisonous tree” and is inadmissible in evidence. (2.5%) [b] The arrest made as a consequence of the invalid search was likewise illegal, because an unlawful act (the search) cannot be made the basis of a lawful arrest. (2.5%) Rule on the correctness of the foregoing arguments, with reasons. -VIII- A law is passed intended to protect women and children from all forms of violence. When a woman perceives an act to be an act of violence or a threat of violence against her, she may apply for a 2 Barangay Protection Order (BPO) to be issued by the Barangay Chairman, which shall have the force and effect of law. Conrado, against whom a BPO had been issued on petition of his wife, went to court to challenge the constitutionality of the law. He raises the following grounds: [a] The law violates the equal protection clause, because while it extends protection to women who may be victims of violence by their husbands, it does not extend the same protection to husbands who may be battered by their wives. (2.5%) [b] The grant of authority to the Barangay Chairman to issue a Barangay Protection Order (BPO) constitutes an undue delegation of judicial power, because obviously, the issuance of the BPO entails the exercise of judicial power. (2.5%) Rule on the validity of the grounds raised by Conrado, with reasons. -IX- The Government, through Secretary Toogoody of the Department of · Transportation (DOTr), filed a complaint for eminent domain to acquire a 1,000- hectare property in Bulacan, owned by Baldomero. The court granted the expropriation, fixed the amount of just compensation, and installed the Government in full possession of the property. [a] If the Government does not immediately pay the amount fixed by the court as just compensation, can Baldomero successfully demand the return of the property to him? Explain your answer. (2.5%) [b] If the Government paid full compensation but after two years it abandoned its plan to build an airport on the property, can Baldomero compel the Government to re-sell the property back to him? Explain your answer. (2.5%) -X- The Philippines entered into an international agreement with members of the international community creating the International Economic Organization (IEO) which will serve as a forum to address economic issues between States, create standards, encourage greater volume of trade between its members, and settle economic disputes. After the Philippine President signed the agreement, the Philippine Senate demanded that the international agreement be submitted to it for its ratification. The President refused, arguing that it is an executive agreement that merely created an international organization and it dwells mainly on addressing economic issues among States. Is the international agreement creating the IEO a treaty or an executive agreement? Explain. (5%) -XI- The USS Liberty, a warship of the United States (U.S.), entered Philippine archipelagic waters on its way to Australia. Because of the negligence of the naval officials on board, the vessel ran aground off the island of Palawan, damaging coral reefs and other marine resources in the area. Officials of Palawan filed a suit for damages against the naval officials for their negligence, and against the U.S., based on Articles 30 and 31 of the United Nations Convention on the Law of the Sea (UNCLOS). Article 31 provides that the Flag State shall bear international responsibility for any loss or damage to the Coastal State resulting from noncompliance by a warship with the laws and regulations of the coastal State concerning passage through the territorial sea. The U. S. Government raised the defenses that: [a] The Philippine courts cannot exercise jurisdiction over another sovereign State, including its warship and naval officials. (2.5%) (b] The United States is not a signatory to UNCLOS and thus cannot be bound by its provisions. (2.5%) 3 -XII- Paragraphs c, d and f of Section 36 of Republic Act No. 9165 provide: “Sec. 36. Authorized drug testing. xx x The following shall be subjected to undergo drug testing: xx x c. Students of secondary and tertiary schools x x x; d. Officers and employees of public and private offices x x x; f. All persons charged before the prosecutor’s office with a criminal offense having an imposable imprisonment of not less than 6 years and 1 day;” Petitioners contend that the assailed portions of Sec. 36 are unconstitutional for violating the right to privacy, the right against unreasonable searches and seizures and the equal protection clause. Decide if the assailed provisions are unconstitutional. (5%) -XIII- While Congress was not in session, the President appointed Antero as Secretary of the Department of Tourism (DOT), Benito as Commissioner of the Bureau o f Immigration (BI), Clodualdo as Chairman o f the Civil Service Commission (CSC), Dexter as Chairman of the Commission on Human Rights (CHR), and Emmanuel as Philippine Ambassador to Cameroon. The following day, all the appointees took their oath before the President, and commenced to perform the functions of their respective offices. [a] Characterize the appointments, whether permanent or temporary; and whether regular or interim, with reasons. (2.5%) [b] A civil society group, the Volunteers Against Misguided Politics (V AMP), files suit, contesting the legality o f the acts o f the appointees and claiming that the appointees should not have entered into the performance of the functions of their respective offices, because their appointments had not yet been confirmed by the Commission on Appointments. Is this claim of VAMP correct? Why or why not? (2.5%) -XIV- Onofre, a natural born Filipino citizen, arrived in the United States in 1985. In 1990, he married Salvacion, a Mexican, and together they applied for and obtained American citizenship in 2001. In 2015, the couple and their children –Alfred, 21 years of age, Robert, 16, and Marie, 14, who were all born in the U.S. — returned to the Philippines on June 1, 2015. On June 15, 2015, informed that he could reacquire Philippine citizenship without losing his American citizenship, Onofre went home to the Philippines and took the oath of allegiance prescribed under R.A. No. 9225. On October 28, 2015, he filed a Certificate of Candidacy to run in the May 9, 2016 elections for the position of Congressman in his home province of Palawan, running against re-electionist Congressman Profundo. [a] Did Onofre’s reacquisition of Philippine citizenship benefit his wife, Salvacion, and their minor children and confer upon them Filipino citizenship? Explain your answer. (2.5%) [b] Before the May 9, 2016 elections, Profundo’s lawyer filed a Petition to Deny Due Course or to Cancel the Certificate of Candidacy against Onofre. What grounds can he raise in his Petition to support it? Explain your answer. (2.5%) -XV- Congress passed a bill appropriating PlOO-billion. Part of the money is to be used for the purchase of a 200-hectare property in Antipolo. The rest shall be spent · for the development of the area and the construction of the Universal Temple for All 4 the World’s Faiths (UTAW-F). When completed, the site will be open, free of charge, to all religions, beliefs, and faiths, where each devotee or believer shall be accommodated and treated in a fair and equal manner, without distinction, favor, or prejudice. There will also be individual segments or zones in the area which can be used for the conduct of whatever rituals, services, sacraments, or ceremonials that may be required by the customs or practices of each particular religion. The President approved the bill, happy in the thought that this could start the healing process of our wounded country and encourage people of varied and often- conflicting faiths to live together in harmony and in peace. If the law is questioned on the ground that it violates Sec. 5, Article III o f the Constitution that “no law shall be made respecting an establishment of religion or prohibiting the free exercise thereof,” how will you resolve the challenge? Explain. (5%) -XVI- Jojo filed a criminal complaint against Art for theft of a backpack worth P150.00 with the Office of the City Prosecutor of Manila. The crime is punishable with arresto mayor to prision correccional in its minimum period, or not to exceed 4 years and 2 months. The case was assigned to Prosecutor Tristan and he applied Sec. 8(a) of Rule 112 which reads: “(a) If filed with the prosecutor. – If the complaint is filed directly with the prosecutor involving an offense punishable by imprisonment of less than four (4) years, two (2) months and one (1) day, the procedure outlined in Sec. 3(a) of this Rule shall be observed. The Prosecutor shall act on the complaint within ten (10) days from its filing.” On the other hand, Sec. 3(a) of Rule 112 provides: “(a) The complaint shall state the address of the respondent and shall be accompanied by affidavits of the complainant and his witnesses as well as other supporting documents to establish probable cause. x x x” Since Sec. 8(a) authorizes the Prosecutor to decide the complaint on the basis of the affidavits and other supporting documents submitted by the complainant, Prosecutor Tristan did not notify Art nor require him to submit a counter-affidavit. He proceeded to file the Information against Art with the Metropolitan Trial Court. Art vehemently assails Sec. 8(a) ofRule 112 as unconstitutional and violative of due process and his rights as an accused under the Constitution for he was not informed of the complaint nor was he given the opportunity to raise his defenses thereto before the Information was filed. Rule on the constitutionality of Sec. 8(a) of Rule 112. Explain. (5%) -XVII- [a] Define the archipelagic doctrine of national territory, state its rationale; and explain how it is implemented through the straight baseline method. (2.5o/o) [b] Section 2 of RA 9522 declared the Kalayaan Island Group (KIG) and Scarborough Shoal as “Regimes of Islands.” Professor Agaton contends that since the law did not enclose said islands, then the Philippines lost its sovereignty and jurisdiction over them. Is his contention correct? Explain. (2.5%) -XVIII- Sec. 8, Article X of the 1987 Constitution provides that no elective official shall serve for more than three (3) consecutive terms. Rule and explain briefly the reason if the official is prohibited to run for another term in each of the following situations: (a) if the official is a Vice-Mayor who assumed the position ofMayor for the unexpired term under the Local Government Code; (b) if the official has served for three consecutive terms and did not seek a 4th term but who won in a recall election; (c) if the position of Mayor of a town is abolished due to conversion of the town to a city; (d) if the official is preventively suspended during his term but was exonerated; and (e) if the official is proclaimed as winner and assumes office but loses in an election protest. (5%) 5 -XIX- Fernando filed an administrative complaint against his co-teacher, Amelia, claiming that the latter is living with a married man who is not her husband. Fernando charged Amelia with committing “disgraceful and immoral conduct” in violation of the Revised Administrative Code and, thus, should not be allowed to remain employed in the government. Amelia,on the other hand, claims that she and her partner are members of a religious sect that allows members of the congregation who have been abandoned by their respective spouses to enter marital relations under a “Declaration of Pledging Faithfulness.” Having made such Declaration, she argues that she cannot be charged with committing immoral conduct for she is entitled to free exercise of religion under the Constitution. [a] Is Amelia administratively liable? State your reasons briefly. (2.5%) [b] Briefly explain the concept of”benevolent neutrality.” (2.5%) -XX- Under Sec. 5, Article VIII of the Constitution, the Supreme Court shall have the power to “promulgate rules concerning the protection and enforcement of constitutional rights, pleading, practice and procedure in all courts xx x.” Section 23 ofR.A. No. 9165 or the Comprehensive Dangerous Drugs Act of2002 provides that “any person charged under any provision of this Act regardless of the imposable penalty shall not be allowed to avail of the provision on plea-bargaining.” Patricio, a user who was charged with alleged sale of shabu but who wants to enter a plea o f guilt to a charge of possession, questions the constitutionality of Sec. 23 on the ground that Congress encroached on the rule-making power of the Supreme Court under Sec. 5, Article VIII. He argues that plea-bargaining is procedural in nature and is within the exclusive constitutional power of the Court. Is Patricio correct? Explain your answer. (5%) Criminal Law -I- Explain the application ofthe Indeterminate Sentence Law (ISL). (5%) -II- [a] Define malfeasance, misfeasance and nonfeasance. (2.5%) [b] Differentiate wheel conspiracy and chain conspiracy. (2.5%) -III- Pedro is married to Tessie. Juan is the first cousin of Tessie. While in the market, Pedro saw a man stabbing Juan. Seeing the attack on Juan, Pedro picked up a spade nearby and hit the attacker on his head which caused the latter’s death. Can Pedro be absolved of the killing on the ground that it is in defense of a relative? Explain. (5%) -IV- Jojo and Felipa are husband and wife. Believing that his work as a lawyer is sufficient to provide for the needs of their family, Jojo convinced Felipa to be a stay- at-home mom and care for their children. One day, Jojo arrived home earlier than usual and caught Felipa in the act of having sexual intercourse with their female nanny, Alma, in their matrimonial bed. In a fit of rage, Jojo retrieved his revolver from inside the bedroom cabinet and shot Alma, immediately killing her. 6 [a] Is Art. 247 (death or physical injuries inflicted under exceptional circumstances) of the Revised Penal Code (RPC) applicable in this case given that the paramour was of the same gender as the erring spouse? (2.5%) [b] Is Felipa liable for adultery for having sexual relations with Alma? (2.5%) -V- Governor A was given the amount of PIO million by the Department of Agriculture for the purpose of buying seedlings to be distributed to the farmers. Supposedly intending to modernize the farming industry in his province, Governor A bought farm equipment through direct purchase from XY Enterprise, owned by his kumpare B, the alleged exclusive distributor of the said equipment. Upon inquiry, the Ombudsman discovered that B has a pending patent application for the said farm equipment. Moreover, the equipment purchased turned out to be overpriced. What crime or crimes, if any, were committed by Governor A? Explain. (5%) -VI- Ofelia, engaged in the purchase and sale ofjewelry, was charged with violation of PD 1612, otherwise known as the Anti-Fencing Law, for having been found in possession of recently stolen jewelry valued at P100,000.00 at her jewelry shop. Her defense is that she merely bought the same from Antonia and produced a receipt covering the sale. She presented other receipts given to her by Antonia representing previous transactions. Convicted of the charge, Ofelia appealed, arguing that her acquisition of the jewelries resulted from a legal transaction and that the prosecution failed to prove that she knew or should have known that the pieces of jewelry which she bought from Antonia were proceeds of the crime of theft. [a] What is a “fence” under PD 1612? (2.5%) [b] Is Ofelia liable under the Anti-Fencing Law? Explain. (2.5%) -VII- Val, a Nigerian, set up a perfume business in the Philippines. The investors would buy the raw materials at a low price from Val. The raw materials consisted of powders, which the investors would mix with water and let stand until a gel was formed. Val made a written commitment to the investors that he would buy back the gel at a higher price, thus assuring the investors of a neat profit. When the amounts to be paid by Val to the investors reached millions ofpesos, he sold all the equipment of his perfume business, absconded with the money, and is nowhere to be found. What crime or crimes were committed, if any? Explain. (5%) -VIII- Charges d’affaires Volvik of Latvia suffers from a psychotic disorder after he was almost assassinated in his previous assignment. One day, while shopping in a mall, he saw a group of shoppers whom he thought were the assassins who were out to kill him. He asked for the gun of his escort and shot ten (10) people and wounded five (5) others before he was subdued. The wounded persons required more than thirty (30) days of medical treatment. What crime or crimes, if any, did he commit? Explain. (5%) -IX- A is the driver of B’s Mercedes Benz car. When B was on a trip to Paris, A used the car for a joy ride with C whom he is courting. Unfortunately, A met an accident. Upon his return, B came to know about the unauthorized use of the car and sued A for qualified theft. B alleged that A took and used the car with intent to gain as he derived some benefit or satisfaction from its use. On the other hand, A argued that he has no intent of making himself the owner of the car as he in fact returned it to the garage after the joy ride. What crime or crimes, if any, were committed? Explain. (5%) 7 -X- The Royal S.S. Maru, a vessel registered in Panama, was 300 nautical miles from Aparri, Cagayan when its engines malfunctioned. The Captain ordered his men to drop anchor and repair the ship. While the officers and crew were asleep, armed men boarded the vessel and took away several crates containing valuable items and loaded them in their own motorboat. Before the band left, they planted an explosive which they detonated from a safe distance. The explosion damaged the hull of the ship, killed ten (10) crewmen, and injured fifteen (15) others. What crime or crimes, if any, were committed? Explain. (5%) -XI- Angelino, a Filipino, is a transgender who underwent gender reassignment and had implants in different parts of her body. She changed her name to Angelina and was a finalist in the Miss Gay International. She came back to the Philippines and while she was walking outside her home, she was abducted by Max and Razzy who took her to a house in the province. She was then placed in a room and Razzy forced her to have sex with him at knife’s point. After the act, it dawned upon Razzy that Angelina is actually a male. Incensed, Razzy called Max to help him beat Angelina. The beatings that Angelina received eventually caused her death. What crime or crimes, if any, were committed? Explain. (5%) -XII- Arnold, 25 years of age, was sitting on a bench in Luneta Park watching the statue of Jose Rizal when, without his permission, Leilani, 17 years of age, sat beside him and asked for financial assistance, allegedly for payment of her tuition fee, in exchange for sex. While they were conversing, police operatives arrested and charged him with violation of Section 10 of RA 7610 (Special Protection of Children against Child Abuse, Exploitation and Discrimination Act), accusing him of having in his company a minor, who is not related to him, in a public place. It was established that Arnold was not in the performance of a social, moral and legal duty at that time. Is Arnold liable for the charge? Explain. (5%) -XIII- Domingo is the caretaker of two (2) cows and two (2) horses owned by Hannibal. Hannibal told Domingo to lend the cows to Tristan on the condition that the latter will give a goat to the former when the cows are returned. Instead, Tristan sold the cows and pocketed the money. Due to the neglect of Domingo, one of the horses was stolen. Knowing that he will be blamed for the loss, Domingo slaughtered the other horse, got the meat, and sold it to Pastor. He later reported to Hannibal that the two horses were stolen. [a] What crime or crimes, if any, did Tristan commit? Explain. (2.5%) [b] What crime or crimes, if any, were committed by Domingo? Explain. (2.5%) -XIV- Dimas was arrested after a valid buy-bust operation. Macario, the policeman who acted as poseur- buyer, inventoried and photographed ten (10) sachets of shabu in the presence of a barangay tanod. The inventory was signed by Macario and the tanod, but Dimas refused to sign. As Macario was stricken with flu the day after, he was able to surrender the sachets to the PNP Crime Laboratory only after four (4) days. During pre-trial, the counsel de oficio of Dimas stipulated that the substance contained in the sachets examined by the forensic chemist is in fact methamphetamine hydrochloride or shabu. Dimas was convicted ofviolating Section 5 of RA 9165. On appeal, Dimas questioned the admissibility of the 8 evidence because Macario failed to observe the requisite “chain of custody” of the alleged “shabu” seized from him. On behalf of the State, the Solicitor General claimed that despite non-compliance with some requirements, the prosecution was able to show that the integrity of the substance was preserved. Moreover, even with some deviations from the requirements, the counsel of Dimas stipulated that the substance seized from Dimas was shabu so that the conviction should be affirmed. [a] What is the “chain of custody” requirement in drug offenses? (2.5%) [b] Rule on the contention of the State. (2.5%) -XV- Pedro, Pablito, Juan and Julio, all armed with bolos, robbed the house where Antonio, his wife, and three (3) daughters were residing. While the four were ransacking Antonio’s house, Julio noticed that one of Antonio’s daughters was trying to escape. He chased and caught up with her at a thicket somewhat distant from the house, but before bringing her back, raped her. [a] What crime or crimes, if any, did Pedro, Pablito, Juan and Julio commit? Explain. (2.5%) [b] Suppose, after the robbery, the four took turns in raping the three daughters inside the house, and, to prevent identification, killed the whole family just before they left. What crime or crimes, if any, did the four malefactors commit? (2.5%) -XVI- A is the president of the corporate publisher of the daily tabloid, Bulgar; B is the managing editor; and C is the author/writer. In his column, Direct Hit, C wrote about X, the head examiner ofthe BIR-RDO Manila as follows: “!tong si X ay talagang BUWAYA kaya ang logo ng Lacoste T shirt niya ay napaka suwapang na buwaya. Ang nickname niya ay si Atty. Buwaya. Ang PR niya ay 90% sa bayad ng taxpayer at ang para sa RP ay 10% /ang. Kaya ang baba ng collection ng RDO niya. Masyadong magnanakaw si X at dapat tangga/in itong bundat na bundat na buwaya na ito at napakalaki na ng kurakot.” A, Band C were charged with libel before the RTC of Manila. The three (3) defendants argued that the article is within the ambit of qualified privileged communication; that there is no malice in law and in fact; and, that defamatory comments on the acts of public officials which are related to the discharge of their official duties do not constitute libel. Was the crime of libel committed? If so, are A, B, and C all liable for the crime? Explain. (5%) -XVII- Braulio invited Lulu, his 11-year old stepdaughter, inside the master bedroom. He pulled out a knife and threatened her with harm unless she submitted to his desires. He was touching her chest and sex organ when his wife caught him in the act. The prosecutor is unsure whether to charge Braulio for acts of lasciviousness under Art. 336 ofthe RPC; for lascivious conduct under RA 7610 (Special Protection against Child Abuse, Exploitation and Discrimination Act); or for rape under Art. 266-A ofthe RPC. What is the crime committed? Explain. (5%) -XVIII- Lina worked as a housemaid and yaya of the one-week old son of the spouses John and Joana. When Lina learned that her 70-year old mother was seriously ill, she asked John for a cash advance of P20,000.00, but the latter refused. In anger, Lina gagged the mouth of the child with stockings, placed him in a box, sealed it with masking tape, and placed the box in the attic. Lina then left the house and asked her friend Fely to demand a P20,000.00 ransom for the release ofthe spouses’ child to be paid 9 within twenty-four hours. The spouses did not pay the ransom. After a couple of days, John discovered the box in the attic with his child already dead. According to the autopsy report, the child died of asphyxiation barely minutes after the box was sealed. What crime or crimes, if any, did Lina and Fely commit? Explain. (5%) -XIX- Romeo and Julia have been married for twelve (12) years and had two (2) children. The first few years of their marriage went along smoothly. However, on the fifth year onwards, they would often quarrel when Romeo comes home drunk. The quarrels became increasingly violent, marked by quiet periods when Julia would leave the conjugal dwelling. During these times of quiet, Romeo would “court” Julia with flowers and chocolate and convince her to return home, telling her that he could not live without her; or Romeo would ask Julia to forgive him, which she did, believing that if she humbled herself, Romeo would change. After a month of marital bliss, Romeo would return to his drinking habit and the quarrel would start again, verbally at first, until it would escalate to physical violence. One night, Romeo came home drunk and went straight to bed. Fearing the onset of another violent fight, Julia stabbed Romeo while he was asleep. A week later, their neighbors discovered Romeo’s rotting corpse on the marital bed. Julia and the children were nowhere to be found. Julia was charged with parricide. She asserted “battered woman’s syndrome” as her defense [a] Explain the “cycle of violence.” (2.5%) [b] Is Julia’s “battered woman’s syndrome” defense meritorious? Explain. (2.5%) -XX- A, an OFW, worked in Kuwait for several years as a chief accountant, religiously sending to his wife, B, 80% of all his earnings. After his stint abroad, he was shocked to know that B became the paramour of a married man, C, and that all the monies he sent to B were given by her to C. To avenge his honor, A hired X, Y and Z and told them to kidnap C and his wife, D, so that he can inflict injuries on C to make him suffer, and humiliate him in front of his wife. X, Y and Z were paid P20,000.00 each and were promised a reward of P50,000.00 each once the job is done. At midnight, A, with the fully armed X, Y and Z, forcibly opened the door and gained entrance to the house of C and D. C put up a struggle before he was subdued by A’s group. They boarded C and D in a van and brought the two to a small hut in a farmoutsideMetroManila. Both hands of Cand D were tied. With the help of X, Y and Z, A raped D in front ofC. X, Y and Z then took turns in raping D, and subjected C to torture until he was black and blue and bleeding profusely from several stab wounds. A and his group set the hut on fire before leaving, killing both C and D. X, Y and Z were paid their reward. Bothered by his conscience, A surrendered the next day to the police, admitting the crimes he committed. As the RTC judge, decide what crime or crimes were committed by A, X, Y and Z, and what mitigating and aggravating circumstances will be applied in imposing the penalty. Explain. (5%) CIVIL LAW -I- Section 1 of P.D. No. 755 states: “Section 1. Declaration of National Policy. – It is hereby declared that the policy of the State is to provide readily available credit facilities to the coconut farmers at preferential rates; that this policy can be expeditiously and efficiently realized by the implementation of the ‘Agreement for the Acquisition of a 10 Commercial Bank for the Benefit of the Coconut Farmers’ executed by the Philippine Coconut Authority, the terms ofwhich ‘Agreement’ are hereby incorporated by reference; x x x” A copy ofthe Agreement was not attached to the Presidential Decree. P.D. No. 755 was published in the Official Gazette but the text of the Agreement described in Section 1 was not published. Can the Agreement in question be accorded the status ofa law? Explain. (5%) -II- With regard to an award of interest in the concept of actual and compensatory damages, please state the guidelines regarding the manner of computing legal interest in the following situations: [a) when the obligation is breached and it consists in the payment of a sum of money like a loan or forbearance of money; (2.5%) [b] when the obligation does not constitute a loan or forbearance of money. (2.5%) Consider the issuance of BSP-MB Circular No. 799, which became effective on July 1, 2013. -III- Romeo and Juliet, both Filipinos, got married. After a few years, Juliet got word from her mother that she can go to the United States for naturalization. Juliet promised she will be back the moment she becomes an American. After sometime, Romeo learned from a friend that Juliet already became a U.S. citizen and even divorced him to marry a wealthy American businessman. Romeo filed a petition before the Regional Trial Court praying that an order be issued authorizing him to remarry pursuant to Article 26 ofthe Family Code. Decide the petition with reasons. (5%) -IV- Leo married Lina and they begot a son. After the bitth oftheir child, Lina exhibited unusual behavior and started to neglect her son; she frequently went out with her friends and gambled in casinos. Lina later had extra-marital affairs with several men and eventually abandoned Leo and their son. Leo was able to talk to the psychiatrist of Lina who told him that Lina suffers from dementia praecox, a form of psychosis where the afflicted person is prone to commit homicidal attacks. Leo was once stabbed by Lina but fortunately he only suffered minor injuries. Will a Petition for Declaration of Nullity of Marriage filed with the court prosper? Explain. (5%) -V- Bernard and Dorothy lived together as common-law spouses although they are both capacitated to marry. After one year of cohabitation, Dorothy went abroad to work in Dubai as a hair stylist and regularly sent money to Bernard. With the money, Bernard bought a lot. For a good price, Bernard sold the lot. Dorothy came to know about the acquisition and sale of the lot and filed a suit to nullify the sale because she did not give her consent to the sale. [a] Will Dorothy’s suit prosper? Decide with reasons. (2.5%) [b] Suppose Dorothy was jobless and did not contribute money to the acquisition o f the lot and her efforts consisted mainly in the care and maintenance o f the family and household, is her consent to the sale a prerequisite to its validity? Explain. (2.5%) 11 -VI- Pedro bought a parcel of land described as Cadastral Lot No. 123 and the title was issued to his name. Juan also bought a lot in the same place, which is described as Cadastral Lot No. 124. Pedro hired a geodetic engineer to determine the actual location of Lot No. 123 but for some reason, the engineer pointed to Lot No. 124 by mistake. Pedro hired a contractor to construct his house and the latter put up a sign stating the name ofthe owner ofthe project and the construction permit number. It took more than a year before the house was constructed. When Pedro was already residing in his house, Juan told him to remove his house because it was built on his (Juan’s) lot. Juan filed a Complaint for Recovery of Possession and prayed that the house be removed because Pedro is a builder in bad faith. Pedro filed his Answer with Counterclaim that he is entitled to the payment of the value of the house plus damages because he is a builder in good faith and that Juan is guilty of estoppel and laches. [a] If Pedro is a builder in good faith, what are the rights given to Juan under the law? Explain. (2.5%) [b] If Pedro is a builder in bad faith, what are the rights given to Juan under the law? Explain. (2.5%) -VII- Benjamin is the owner of a titled lot which is bounded on the north by the Maragondon River. An alluvial deposit of two (2) hectares was added to the registered area. Daniel took possession of the portion formed by accretion and claims that he has been in open, continuous and undisturbed possession ofsaid portion since 1923 as shown by a tax declaration. In 1958, Benjamin filed a Complaint for Quieting of Title and contends that the alluvium belongs to him as the riparian owner and that since the alluvium is, by law, part and parcel ofthe registered property, the same may be considered as registered property. Decide the case and explain. (5%) -VIII- Joven and Juliana are the owners of a 30-hectare plantation in Cotabato, covered by a title. One day, a group ofarmed men forcibly entered their house and, at gun point, forced them to sign a Deed of Absolute Sale in favor ofRomeo. Romeo got the title from them and they were ejected from the house and threatened not to come back or else they will be killed. The spouses went to Manila and resided there for more than 35 years. They never went back to Cotabato for fear oftheir lives. Word came to them that peace and order have been restored in their former place ofresidence and they decided to reclaim their land for the benefit of their grandchildren. Joven and Juliana filed a suit for reconveyance of their property. This was opposed by the grandson of Romeo to whom the title was eventually transferred, on the ground of laches and prescription. Decide the case and rule on the defenses of laches and prescription. Explain your answer. (5%) -IX- Butch got a loan from Hagibis Corporation (Hagibis) but he defaulted in the payment. A case for collection of a sum of money was filed against him. As a defense, Butch claims that there was already an arrangement with Hagibis on the payment of the loan. To implement the same, Butch already surrendered five (5) service utility vehicles (SUVs) to the company for it to sell and the proceeds to be credited to the loan as payment. Was the obligation of Butch extinguished by reason of dacion enpago upon the surrender ofthe SUVs? Decide and explain. (5%) -X- Jerico, the project owner, entered into a Construction Contract with Ivan for the latter to construct his house. Jojo executed a Surety undertaking to guarantee the performance of the work by Ivan. Jerico and Ivan later entered into a Memorandum of Agreement (MOA) revising the work schedule ofIvan and the subcontractors. The MOA stated that all the stipulations ofthe original contract not in conflict with said agreement shall remain valid and legally effective. Jojo filed a suit to declare him relieved of his 12 undertaking as a result ofthe MOA because ofthe change in the work schedule. Jerico claims there is no novation of the Construction Contract. Decide the case and explain. (5%) -XI- Ellen entrusted her title over the lot where she is residing to Patrick, her nephew, for safekeeping because of her poor eyesight. Patrick, a gambler, prepared a Special Power of Attorney empowering him to mortgage the lot. Ellen’s signature was forged. With the help of Julia who represented herself as Ellen, Mega Bank granted a loan to Patrick secured by a mortgage on Ellen’s lot. Due to non-payment, Mega Bank foreclosed the mortgage and was declared the highest bidder. Title was later registered in the name of the bank. When Ellen was notified that she should vacate the premises, she filed a complaint to nullify the loan with mortgage, the auction sale and the title of Mega Bank on the ground that the bank is not a mortgagee in good faith. Decide the case with reasons. (5%) -XII- On March 13, 2008, Ariel entered into a Deed of Absolute Sale (DAS) with Noel where the former sold his titled lot in Quezon City with an area of three hundred (300) square meters to the latter for the price o f P300,000.00. The prevailing market value o f the lot was P3,000.00 per square meter. On March 20, 2008, they executed another “Agreement To Buy Back/Redeem Property” where Ariel was given an option to repurchase the property on or before March 20, 2010 for the same price. Ariel, however, remained in actual possession ofthe lot. Since Noel did not pay the taxes, Ariel paid the real property taxes to avoid a delinquency sale. On March 21, 2010, Ariel sent a letter to Noel, attaching thereto a manager’s check for P300,000.00 manifesting that he is redeeming the property. Noel rejected the redemption claiming that the DAS was a true and valid sale representing the true intent of the parties. Ariel filed a suit for the nullification ofthe DAS or the reformation of said agreement to that of a Loan with Real Estate Mortgage. He claims the DAS and the redemption agreement constitute an equitable mortgage. Noel however claims it is a valid sale with pacto de retro and Ariel clearly failed to redeem the property. As the RTC judge, decide the case with reasons. (5%) -XIII- Peter, a resident ofCebu City, sent through Reliable Pera Padala (RPP) the amount ofP20,000.00 to his daughter, Paula, for the payment of her tuition fee. Paula went to an RPP branch but was informed that there was no money remitted to her name. Peter inquired from RPP and was informed that there was a computer glitch and the money was credited to another person. Peter and Paula sued RPP for actual damages, moral damages and exemplary damages. The trial court ruled that there was no proof of pecuniary loss to the plaintiffs but awarded moral damages of P20,000.00 and exemplary damages of P5,000.00. On appeal, RPP questioned the award of moral and exemplary damages. Is the trial court correct in awarding moral and exemplary damages? Explain. (5%) -XIV- On February 28, 1998, Arthur filed an application for registration oftitle ofa lot in Temate, Cavite before the Regional Trial Court of Naic, Cavite under Section 48(b) of Commonwealth Act No. 141 (CA 141) for judicial confirmation ofimperfect title. Section 48(b) of CA 141 requires possession counted from June 12, 1945. Arthur presented testimonial and documentary evidence that his possession and that o f his predecessors-in- interest started in 1936. The lot was declared alienable and disposable (A and D) in 1993 based on a PENRO certification and a certified true copy of the original classification made by the DENR Secretary. The government opposed the application on the ground that the lot was certified A and D only in 1993 while the application was instituted only in 1998. Arthur’s possession of five (5) years from the date of declaration does not comply with the 30-year period required under CA 141. Should the possession ofArthur be reckoned from the date when the lot was declared A and D or from the date of actual possession ofthe applicant? Explain. (5%) 13 -XV- Peter and Paul entered into a Contract to Sell whereby Peter, the lot owner, agreed to sell to Paul his lot on November 6, 2016 for the price ofPl,000,000.00 to be paid at the residence of Peter in Makati City at 1:00 p.m. If the full price is paid in cash at the specified time and place, then Peter will execute a Deed ofAbsolute Sale and deliver the title to Paul. On November 6, 2016, Paul did not show up and was not heard of from that date on. In view of the nonperformance by Paul of his obligation, Peter sent a letter to Paul that he is expressly and extra- judicially declaring the Contract to Sell rescinded and ofno legal and binding effect. Peter further stated that failure on the part of Paul to contest the rescission within thirty (30) days from receipt of said letter shall mean that the latter agreed to the rescission. Paul did not reply to this letter for five (5) years. Thus, Peter decided to sell his lot to Henry in 2021. After hearing that Henry bought the lot, Paul now questions the sale of the lot to Henry and files a complaint for nullification of the sale. [a] Is the exercise by Peter of his power to rescind extra-judicially the Contract to Sell the proper and legal way of rescinding said contract? Explain. (2.5%) [b] In case Paul made a downpayment pursuant to a stipulation in the Contract to Sell, what is the legal remedy ofPeter? (2.5%) -XVI- Don Ricardo had 2 legitimate children – Tomas and Tristan. Tristan has 3 children. Meanwhile, Tomas had a relationship with Nancy, who was also single and had the legal capacity to marry. Nancy became pregnant and gave birth to Tomas, Jr. After the birth of Tomas, Jr., his father, Tomas, died. Later, Don Ricardo died without a will and Tristan opposed the motion of Tomas, Jr. to be declared an heir of the deceased since he is an illegitimate child. Tomas, Jr. countered that Article 992 of the Civil Code is unconstitutional for violation of the equal protection of the laws. He explained that an illegitimate child of an illegitimate parent is allowed to inherit under Articles 902, 982 and 990 o f the Civil Code while he – an illegitimate child o f a legitimate father – cannot. Civil Law commentator Arturo Tolentino opined that Article 992 created an absurdity and committed an injustice because while the illegitimate descendant o f an illegitimate child can represent, the illegitimate descendant of a legitimate child cannot. Decide the case and explain. (5%) -XVII- Macario bought a titled lot from Ramon, got the title and took possession ofthe lot. Since Macario did not have the money to pay the taxes, fees and registration expenses, he was not able to register the Deed ofAbsolute Sale. Upon advice, he merely executed an Affidavit of Adverse Claim and had it annotated at the back of the title. A few years after, he received a Notice ofLevy on Attachment and Writ ofExecution in favor ofAlex. The notice, writ and certificate of sale were annotated at the back of the title still in Ramon’s name. Alex contends that since the Affidavit of Adverse Claim is effective only for 30 days from the date o f its registration, then its validity has expired. Macario posits that the annotation ofhis adverse claim is notice to the whole world ofhis purchase ofthe lot in question. Who has the superior right over the disputed property – Macario or Alex? Explain. (5%) -XVIII- Dr. Jack, a surgeon, holds clinic at the St. Vincent’s Hospital and pays rent to the hospital. The fees of Dr. Jack are paid directly to him by the patient or through the cashier ofthe hospital. The hospital publicly displays in the lobby the names and specializations of the doctors associated or accredited by it, including that of Dr. Jack. Marta engaged the services of Dr. Jack because of recurring stomach pain. 14 It was diagnosed that she is suffering from cancer and had to be operated on. Before the operation, she was asked to sign a “consent for hospital care,” which reads: “Permission is hereby given to the medical, nursing and laboratory staff of the St. Vincent’s Hospital to perform such procedures and to administer such medications and treatments as may be deemed necessary or advisable by the physicians o f this hospital for and during the confinement.” After the surgery, the attending nurses reported that two (2) sponges were missing. Later, Marta died due to complications brought about by the sponges that were left in her stomach. The husband ofMarta sued the hospital and Dr. Jack for damages arising from negligence in the medical procedure. The hospital raised the defense that Dr. Jack is not its employee as it did not hire Dr. Jack nor pay him any salary or compensation. It has absolutely no control over the medical services and treatment being provided by Dr. Jack. Dr. Jack even signed an agreement that he holds the hospital free and harmless from any liability arising from his medical practice in the hospital. Is St. Vincent’s Hospital liable for the negligence of Dr. Jack? Explain your answer. (5%) -XIX- Brad and Angelina had a secret marriage before a pastor whose office is located in Arroceros Street, City ofManila. They paid money to the pastor who took care ofall the documentation. When Angelina wanted to go to the U.S., she found out that there was no marriage license issued to them before their marriage. Since their marriage was solemnized in 1995 after the effectivity of the Family Code, Angelina filed a petition for judicial declaration of nullity on the strength of a certification by the Civil Registrar of Manila that, after a diligent and exhaustive search, the alleged marriage license indicated in the marriage certificate does not appear in the records and cannot be found. [a] Decide the case and explain. (2.5%) [b] In case the marriage was solemnized in 1980 before the effectivity of the Family Code, is it required that a judicial petition be filed to declare the marriage null and void? Explain. (2.5%) -XX- Princess married Roberto and bore a son, Onofre. Roberto died in a plane crash. Princess later married Mark and they also had a son – Pepito. Onofre donated to Pepito, his half-brother, a lot in Makati City worth P3,000,000.00. Pepito succumbed to an illness and died intestate. The lot given to Pepito by Onofre was inherited by his father, Mark. Mark also died intestate. Lonely, Princess followed Mark to the life beyond. The claimants to the subject lot emerged – Jojo, the father of Princess; Victor, the father of Mark; and Jerico, the father ofRoberto. Who among the three (3) ascendants is entitled to the lot? Explain. (5%) Mercantile Law -I- What does “doing business in the Philippines” under the Foreign Investments Act of 1991 mean? (5%) -II- Jason is the proud owner of a newly-built house worth PS million. As a protection against any possible loss or damage to his house, Jason applied for a fire insurance policy thereon with Shure Insurance Corporation (Shure) on October 11, 2016 and paid the premium in cash. It took the company a week to approve Jason’s application. On October 18, 2016, Shure mailed the approved policy to Jason which the latter received five (5) days later. However, Jason’s house had been razed by fire which transpired 15 a day before his receipt of the approved policy. Jason filed a written claim with Shure under the insurance policy. Shure prays for the denial of the claim on the ground that the theory of cognition applies to contracts of insurance. Decide Jason’s claim with reasons. (5%) -III- ABC Appliances Corporation (ABC) is a domestic corporation engaged in the production and sale of televisions and other appliances. Y Y Y Engineers, a Taiwanese company, is the manufacturer of televisions and other appliances from whom ABC actually purchases appliances. From 2000, when ABC started doing business with YYY, it has been using the mark “TTubes” in the Philippines for the television units that were bought from YYY. In 2015, YYY filed a trademark application for “TTubes.” Later, ABC also filed its application. Both claim the right over the trademark “TTubes” for television products. YYY relies on the principle o f “first to file” while ABC involves the “doctrine of prior use.” [a] Does the fact that YYY filed its application ahead of ABC mean that YYY has the prior right over the trademark? Explain briefly. (2.5o/o) [b] Does the prior registration also mean a conclusive assumption that YYY Engineers is in fact the owner of the trademark “TTubes?” Briefly explain your answer. (2.5%) -IV- X’s “MINI-ME” burgers are bestsellers in the country. Its “MINI-ME” logo, which bears the color blue, is a registered mark and has been so since the year 2010. Y, a competitor ofX, has her own burger which she named “ME-TOO” and her logo thereon is printed in bluish-green. When X sued Y for trademark infringement, the trial court ruled in favor of the plaintiff by applying the Holistic Test. The court held that Y infringed on X’s mark since the dissimilarities between the two marks are too trifling and frivolous such that Y’s “ME-TOO,” when compared to X’s “MINI-ME,” will likely cause confusion among consumers. Is the application of the Holistic Test correct? (5%) -V- MS Brewery Corporation (MS) is a manufacturer and distributor of the popular beer “MS Lite.” It faces stiff competition from BA Brewery Corporation (BA) whose sales of its own beer product, “BA Lighter,” has soared to new heights. Meanwhile, sales of the “MS Lite” decreased considerably. The distribution and marketing personnel of MS later discovered that BA has stored thousands of empty bottles of “MS Lite” manufactured by MS in one of its warehouses. MS filed a suit for unfair competition against BA before the Regional Trial Court (RTC). Finding a connection between the dwindling sales of MS and the increased sales of BA, the RTC ruled that BA resorted to acts of unfair competition to the detriment of MS. Is the RTC correct? Explain. (5%) -VI- Nautica Shipping Lines (Nautica) bought a second hand passenger ship from Japan. It modified the design o f the bulkhead of the deck o f the ship to accommodate more passengers. The ship sunk with its passengers in Tablas Strait due to heavy rains brought by the monsoon. The heirs of the passengers sued Nautica for its liability as a common carrier based on the reconfiguration of the bulkhead which may have compromised the stability of the ship. Nautica raised the defense that the monsoon is a fortuitous event and, at most, its liability is prescribed by the Limited Liability Rule. Decide with reasons. (5%) 16 -VII- A railroad track of the Philippine National Railway (PNR) is located near a busy intersection of Puyat Avenue and Osmefia Highway. One afternoon, the intersection was heavily congested, as usual. Juan, the driver of a public utility jeepney (PUJ), drove onto the railroad tracks but could go no farther because ofthe heavy traffic at the intersection. After the jeepney stopped right on the railroad track, it was hit and overturned by a PNR train, resulting in the death of Kim, a passenger of the PUJ, and injuries to Juan and his other passengers. Juan, the injured passengers and Kim’s family sued the PNR for damages for its negligence. It was established that the steel pole barrier before the track was broken, and that the PNR had the last clear chance of avoiding the accident. On the other hand, the PNR raised the defense that the track is for the exclusive use of the train and that motorists are aware that it is negligence per se to stop their vehicles on the tracks. Decide the case and explain. (5%) -VIII- In 2015, Total Bank (Total) proposed to sell to Royal Bank (Royal) its banking business for P 10 billion consisting o f specified assets and liabilities. The parties reached an eventual agreement, which they termed as “Purchase and Assumption (P & A) Agreement,” in which Royal would acquire Total’s specified assets and liabilities, excluding contingent claims, with the further stipulation that it should be approved by the Bangko Sentral ng Pilipinas (BSP). BSP imposed the condition that Total should place in escrow Pl billion to cover for contingent claims against it. Total complied. After securing the approval of the BSP, the two banks signed the agreement. BSP thereafter issued a circular advising all bank and non-bank intermediaries that effective January 1, 2016, “the banking activities of Total Bank and Royal Bank have been consolidated and the latter has carried out their operations since then.” [a] Was there a merger and consolidation of the two banks in point of the Corporation Code? Explain. (2.5%) [b] What is meant by a de facto merger? Discuss. (2.5%) -IX- X insured his life for P20 million. X, plays golf and regularly exercises everyday, hence is considered in good health. He did not know, however, that his frequent headache is really caused by his being hypertensive. In his application form for a life insurance for himself, he did not put a check to the question if he is suffering from hypertension, believing that because of his active lifestyle, being hypertensive is a remote possibility. While playing golf one day, X collapsed at the fairway and was declared dead on arrival at the hospital. His death certificate stated that X suffered a massive heart attack. [a] Will the beneficiary of X be entitled to the proceeds of the life insurance under the circumstances, despite the non-disclosure that he is hypertensive at the time of application? (2.5%) [b] If X died in an accident instead ofa heart attack, would the fact of X’s failure to disclose that he is hypertensive be considered as material information? (2.5%) -X- After securing a Pl million loan from B, A drew in B’s favor a bill of exchange with C as drawee. The bill reads: “October 1, 2016. Pay to the order of B the sum ofPl million. To: C (drawee). Signed, A.” A then delivered the bill to B who, however, lost it. It turned out that it was stolen by D, B’s brother. D lost no time in forging B’s signature and negotiated it to E who acquired it for value and in good faith. May E recover on the bill from C, the drawee? Explain. (5%) 17 -XI- Royal Links Golf Club obtained a loan from a bank which is secured by a mortgage on a titled lot where holes 1, 2, 3 and 4 are located. The bank informed the Board of Directors (Board) that if the arrearages are not paid within thirty (30) days, it will extra-judicially foreclose the mortgage. The Board decided to offer to the members 200 proprietary membership shares, which are treasury shares, at the price of P175,000.00 per share even when the current market value is P200,000.00. In behalf and for the benefit of the corporation, Peter, a stockholder, filed a derivative suit against the members of the Board for breach of trust for selling the shares at P25,000.00, lower than its market value, and asked for the nullification of the sales and the removal of the board members. Peter claims the Club incurred a loss of P5 million. The Board presented the defense that in its honest belief any delay in the payment of the arrearages will be prejudicial to the Club as the mortgage on its assets will be foreclosed and the sale at a lower price is the best solution to the problem. Decide the suit and explain. (5%) -XII- X owns I0,000 shares in Z Telecoms Corp. As he is in immediate need of money, he offered to sell all his shares to his friend, Y, at a bargain price. Upon receipt of the purchase price from Y, X proceeded to indorse in blank the certificates of shares and delivered these to Y. The latter then went to the corporate secretary of Z Telecoms Corp. and requested the transfer of the shares in his name. The corporate secretary refused since X merely indorsed the certificates in blank to Y. According to the corporate secretary, the certificates should have been specifically indorsed to the purchaser, Y. Was the corporate secretary justified in declining Y’s request? Discuss. (5%) -XIII- C Corp. is the direct holder of 10% of the shareholdings in U Corp., a non- listed (not public) firm, which in turn owns 62% of the shareholdings in H Corp., a publicly listed company. The other principal stockholder in H Corp. is C Corp. which owns 18% of its shares. Meanwhile, the majority stocks in U Corp. are owned by B Corp. and V Corp. at 22% and 30%, respectively. B Corp. and V Corp. later sold their respective shares in U Corp. to C Corp., thereby resulting in the increase ofC Corp.’s interest in U Corp., whether direct or indirect, to more than 50%. [a] Explain the Tender Offer Rule under the Securities Regulation Code. (2.5%) [b] Does the Tender Offer Rule apply in this case where there has been an indirect acquisition of the shareholdings in H Corp. by C Corp.? Discuss. (2.5%) -XIV- X, a government official, has a number of bank accounts in T Bank containing millions of pesos. He also opened several trust accounts in the same bank which specifically covered the placement and/or investment of funds. X was later charged with graft and corruption before the Sandiganbayan (SB) by the Ombudsman. The Special Prosecutor filed a motion praying for a court order authorizing it to look into the savings and trust accounts of X in T Bank. X opposed the motion arguing that the trust accounts are not “deposits” under the Law on Secrecy of Bank Deposits (Rep. Act No. 1405). Is the contention of X correct? Explain. (5%) -XV- ABC Corp. is engaged in the pawnshop business involving cellphones, laptops and other gadgets of value. In order to expand its business and attract investors, it offered to any person who invests at least Pl00,000.00 a “Promissory Note” where it obligated itself to pay the holder a 50% return on investment within one month. Due to the attractive offer, many individuals invested in the company but not one ofthem was able to realize any profit after one month. 18 Has ABC Corp. violated any law with its scheme? Explain. (5%) -XVI- Henry is a board director in XYZ Corporation. For being the “fiscalizer” in the Board, the majority of the board directors want him removed and his shares sold at auction, so he can no longer participate even in the stockholders’ meetings. Henry approaches you for advice on whether he can be removed as board director and stockholder even without cause. What is your advice? Explain “amotion” and the procedure in removing a director. (5%) -XVII- PJ Corporation (PJ) obtained a loan from ABC Bank (ABC) in the amount of Pl 0 million for the purchase of 100 pieces of ecodoors. Thereafter, a Letter of Credit was obtained by PJ against such loan. The beneficiary of the Letter of Credit is Scrap Metal Corp. (Scrap Metal) in Beijing, China. Upon arrival of 100 pieces of ecodoors, PJ executed a Trust Receipt in favor of ABC to cover for the value of the ecodoors for its release to PJ. The terms of the Trust Receipt is that any proceeds from the sale of the ecodoors will be delivered to ABC as payment. After the ecodoors were sold, PJ, instead of paying ABC, used the proceeds of the sale to order from Scrap Metal another I00 pieces of ecodoors but using another bank to issue a new Letter of Credit fully covered by such proceeds. PJ refused to pay the proceeds of the sale of the first set of ecodoors to ABC, claiming that the ecodoors that were delivered were defective. It then instructed ABC not to negotiate the Letter of Credit that was issued in favor of Scrap Metal. [a] Explain what is a “Letter of Credit” as a financial device and a “Trust Receipt” as a security to the Letter of Credit. (2.5%) [b] As counsel of ABC, you are asked for advice on whether or not to grant the instruction ofPJ. What will be your advice? (2.5%) -XVIII- B Bank, a large universal bank, regularly extends revolving credit lines to business establishments under what it terms as socially responsible banking and private business partnership relations. All loans that are extended to clients have a common “Escalation Clause,” to wit: “B Bank hereby reserves its right to make successive increases in interest rates in accordance with the bank’s adopted policies as approved by the Monetary Board; Provided that each successive increase shall be with the written assent ofthe depositor.” [a] X, a regular client of the bank, contends that the “Escalation Clause” is unfair, unconscionable and contrary to law, morals, public policy and customs. Rule on the issue and explain. (2.5%) [b] Suppose that the “Escalation Clause” instead reads: “B Bank hereby reserves the right to make reasonable increases in interest rates in accordance with bank policies as approved by the Monetary Board; Provided, there shall be corresponding reasonable decreases in interest rates as approved by the Monetary Board.” Would this be valid? Explain. (2.5%) -XIX- In 2015, R Corp., a domestic company that is wholly owned by Filipinos, filed its opposition to the applications for Mineral Production Sharing Agreements (MPSA) of O Corp., P Corp., and Q Corp. which were pending before the Panel of Arbitrators (POA) of the Department of Environment and Natural Resources (DENR). The three corporations wanted to undertake exploration and mining activities in the province of Isabela. The oppositor alleged that at least 60% of the capital shareholdings of the applicants are owned by B Corp., a 100% Chinese corporation, in violation of Sec. 2, Art. XII of the Constitution. The applicants countered that they are qualified corporations as defined under the 19 Philippine Mining Act of 1995 and the Foreign Investments Act of 1991 since B Corp. holds only 40% of the capital stocks in each of them and not 60% as alleged by R Corp. The Summary of Significant Accounting Policies statement of B Corp. reveals that the joint venture agreements of B Corp. with Sigma Corp. and Delta Corp. involve the O Corp., P Corp., and Q Corp. The ownership of the layered corporations and joint venture agreements show that B Corp. practically exercises control over the O, P and Q corporations. O, P and Q corporations contend that the control test should be applied and its MPSA applications granted. On the other hand, R Corp. argues that the “grandfather rule” should be applied. Decide with reasons. (5%) -XX- Company X issued a Bank A Check No. 12345 in the amount of P500,000.00 payable to the Bureau of Internal Revenue (BIR) for the company’s taxes for the third quarter of 1997. The check was deposited with Bank B, the collecting bank with which the BIR has an account. The check was subsequently cleared and the amount of P500,000.00 was deducted from the company’s balance. Thereafter, Company X was notified by the BIR of its non-payment of its unpaid taxes despite the P500,000.00 debit from its account. This prompted the company to seek assistance from the proper authorities to investigate on the matter. The results of the investigation disclosed that unknown then to Company X, its chief accountant Bonifacio Santos is part of a syndicate that devised a scheme to syphon its funds. It was discovered that though deposited, the check was never paid to the BIR but was passed on by Santos to Winston Reyes, Bank B’s branch manager and Santos’ co-conspirator. Instead of bringing the check to the clearing house, Reyes replaced Check No. 12345 with a worthless check bearing the same amount, and tampered documents to cover his tracks. No amount was then credited to the BIR. Meanwhile, Check No. 12345 was subsequently cleared and the amount therein credited into the accounts of fictitious persons, to be later withdrawn by Santos and Reyes. Company X then sued Bank B for the amount of P500,000.00 representing the amount deducted from its account. Bank B interposed the defense that Company X was guilty of contributory negligence since its confidential employee Santos was an integral part of the scheme to divert the proceeds of Check No. 12345. Is Company X entitled to reimbursement from Bank B, the collecting bank? Explain. (5%) LABOR LAW -I- What are the requisites o f a valid quitclaim? (5%) -II- Gregorio was hired as an insurance underwriter by the Guaranteed Insurance Corporation (Guaranteed). He does not receive any salary but solely relies on commissions earned for every insurance policy approved by the company. He hires and pays his own secretary but is provided free office space in the office of the company. He is, however, required to meet a monthly quota of twenty (20) insurance policies, otherwise, he may be terminated. He was made to agree to a Code of Conduct for underwriters and is supervised by a Unit Manager. [a] Is Gregorio an employee of Guaranteed? Explain. (2.5%) [b] Suppose Gregorio is appointed as Unit Manager and assigned to supervise several underwriters. He holds office in the company premises, receives an overriding commission on the commissions of his underwriters, as well as a monthly allowance from the company, and is supervised by a branch manager. He is governed by the Code of Conduct for Unit Managers. Is he an employee of Guaranteed? Explain. (2.5%) 20 -III- Inggo is a drama talent hired on a per drama “participation basis” by DJN Radio Company. He worked from 8:00 a.m. until 5:00 p.m., six days a week, on a gross rate of P80.00 per script, earning an average of P20,000.00 per month. Inggo filed a complaint before the Department of Labor and Employment (DOLE) against DJN Radio for illegal deduction, non-payment of service incentive leave, and 13th month pay, among others. On the basis of the complaint, the DOLE conducted a plant level inspection. The DOLE Regional Director issued an order ruling that Inggo is an employee of DJN Radio, and that Inggo is entitled to his monetary claims in the total amount of P30,000.00. DJN Radio elevated the case to the Secretary of Labor who affirmed the order. The case was brought to the Court of Appeals. The radio station contended that there is no employer-employee relationship because it was the drama directors and producers who paid, supervised, and disciplined him. Moreover, it argued that the case falls under the jurisdiction of the NLRC and not the DOLE because Inggo’s claim exceeded PS,000.00. [a] May DOLE make a prima facie determination of the existence of an employer-employee relationship in the exercise of its visitorial and enforcement powers? (2.5%) [b] If the DOLE finds that there is an employee-employer relationship, does the case fall under the jurisdiction of the Labor Arbiter considering that the claim of Inggo is more than P5,000.00. Explain. (2.5%) -IV- Hagibis Motors Corporation (Hagibis) has 500 regular employees in its car assembly plant. Due to the Asian financial crisis, Hagibis experienced very low car sales resulting to huge financial losses. It implemented several cost-cutting measures such as cost reduction on use of office supplies, employment hiring freeze, prohibition on representation and travel expenses, separation o f casuals and reduced work week. As counsel of Hagibis, what are the measures the company should undertake to implement a valid retrenchment? Explain. (5%) -V- Asia Union (Union) is the certified bargaining agent of the rimk-and-file employees of Asia Pacific Hotel (Hotel). The Union submitted its Collective Bargaining Agreement (CBA) negotiation proposals to the Hotel. Due to the bargaining deadlock, the Union, on December 20, 2014, filed a Notice of Strike with the National Conciliation and Mediation Board (NCMB). Consequently, the Union conducted a Strike Vote on January 14, 2015, when it was approved. The next day, waiters who are members ofthe Union came out ofthe Union office sporting closely cropped hair or cleanly shaven heads. The next day, all the male Union members came to work sporting the same hair style. The Hotel prevented these workers from entering the premises, claiming that they violated the company rule on Grooming Standards. On January 16, 2015, the Union subsequently staged a picket outside the Hotel premises and prevented other workers from entering the Hotel. The Union members blocked the ingress and egress of customers and employees to the Hotel premises, which caused the Hotel severe lack of manpower and forced the Hotel to temporarily cease operations resulting to substantial losses. On January 20, 2015, the Hotel issued notices to Union members, preventively suspending them and charging them with the following offenses: (1) illegal picket; (2) violation of the company rule on Grooming Standards; (3) illegal strike; and (4) commission of illegal acts during the illegal strike. The Hotel later terminated the Union officials and members who participated in the strike. The Union denied it engaged in an illegal strike and countered that the Hotel committed an unfair labor practice (ULP) and a breach of the freedom of speech. 21 [a] Was the picketing legal? Was the mass action ofthe Union officials and members an illegal strike? Explain. (2.5%) [b] Rule on the allegations of ULP and violation of freedom of speech. Explain. (2.5%) -VI- Pedro, a bus driver of Biyahe sa Langit Transport, was involved in a collision with a car, damaging the bus. The manager accused him of being responsible for the damage and was told to submit his written explanation within 48 hours. Pedro submitted his explanation within the period. The day after, Pedro received a notice of termination stating that he is dismissed for reckless driving resulting to damage to company property, effective immediately. Pedro asks you, as his counsel, if the company complied with the procedural due process with respect to dismissal of employees. [a] Explain the twin notice and hearing rule. (2.5%) [b] Did the Biyahe sa Langit Transport comply with the prior procedural requirements for dismissal? (2.5%) -VII- Forbes Country Club (Club) owns a golf course and has 250 rank-and-file employees who are members of the Forbes Country Club Union (Union). The Club has a CBA with the Union and one of the stipulations is a Union Security Clause, which reads: “All regular rank-and-file employees who are members of the union shall keep their membership in good standing as a condition for their continued employment during the lifetime ofthis agreement.” Peter, Paul and Mary were the Treasurer, Assistant Treasurer, and Budget Officer of the Union, respectively. They were expelled by the Board of Directors of the Union for malversation. The Union then demanded that the Club dismiss said officials pursuant to the Union Security Clause that required maintenance of union membership. The Club required the three officials to show cause in writing why they should not be dismissed. Later, the Club called the three Union officials for a conference regarding the charges against them. After considering the evidence submitted by the parties and their written explanations, the Club dismissed the erring officials. The dismissed officials sued the Club and the Union for illegal dismissal because there was really no malversation based on the documents presented and their dismissal from the Union was due to the fact that they were organizing another union. [a] Is the dismissal ofPeter, Paul and Mary by the Club valid? (2.5%) [b] If the expulsion by the Union was found by the Labor Arbiter to be baseless, is the Club liable to Peter, Paul and Mary? Explain. (2.5%) -VIII- Differentiate learnership from apprenticeship with respect to the period of training, type ofwork, salary and qualifications. (5%) -IX- Zienna Corporation (Zienna) informed the Department of Labor and Employment Regional Director of the end of its operations. To carry out the cessation, Zienna sent a Letter Request for Intervention to the NLRC for permission and guidance in effecting payment of separation benefits for its fifty (50) terminated employees. Each of the terminated employees executed a Quitclaim and Release before Labor Arbiter Nocomora, to whom the case was assigned. After the erstwhile employees received their separation pay, the Labor 22 Arbiter declared the labor dispute dismissed with prejudice on the ground of settlement. Thereafter, Zienna sold all of its assets to Zandra Company (Zandra), which in tum hired its own employees. Nelle, one of the fifty (50) terminated employees, filed a case for illegal dismissal against Zienna. She argued that Zienna did not cease from operating since the corporation subsists as Zandra. Nelle pointed out that aside from the two companies having essentially the same equipment, the managers and owners of Zandra and Zienna are likewise one and the same. For its part, Zienna countered that Nelle is barred from filing a complaint for illegal dismissal against the corporation in view of her prior acceptance of separation pay. Is Nelle correct in claiming that she was illegally dismissed? (5%) -X- Lazaro, an engineer, organized a union in Garantisado Construction Corporation (Garantisado) which has 200 employees. He immediately filed a Petition for Certification Election, attaching thereto the signatures of 70 employees. Garantisado vehemently opposed the petition, alleging that 25 signatories are probationary employees, while 5 are supervisors. It submitted the contracts of the 25 probationary employees and the job description of the supervisors. It argued that if 30 is deducted from 70, it gives a balance of 40 valid signatures which is way below the minimum number of 50 signatories needed to meet the alleged 25% requirement. Ifyou are the Director ofLabor Relations, will you approve the holding of a Certification Election. Explain your answer. (5%) -XI- Dion is an Accounting Supervisor in a trading company. He has rendered exemplary service to the company for 20 years. His co-employee and kumpadre, Mac, called him over the phone and requested him to punch his (Mac’s) daily time card as he (Mac) was caught in a monstrous traffic jam. Dion acceded to Mac’s request but was later caught by the Personnel Manager while punching. Mac’s time card. The company terminated the employment of Dion on the ground of misconduct. Is the dismissal valid and just? Explain.(5%) -XII- Amaya was employed as a staff nurse by St. Francis Hospital (SFH) on July 8, 2014 on a probationary status for six (6) months. Her probationary contract required, among others, strict compliance with SFH’s Code ofDiscipline. On October 16, 2014, Dr. Ligaya, filed a Complaint with the SFH Board of Trustees against Amaya for uttering slanderous remarks against the former. Attached to the complaint was a letter of Minda, mother of a patient, who confirmed the following remarks against Dr. Ligaya: “Bakit si Dr. Ligaya pa ang napili mong ‘pedia’ eh ang tanda- tanda na n’un? E makakalimutin na yun x x x Alam mo ba, kahit wala namang diperensya yung baby, ipinapa-iso/ate nya?” The SFH President asks you, being the hospital’s counsel, which of these two (2) options is the legal and proper way ofterminating Amaya: a) terminate her for a just cause under Article 288 of the Labor Code (Termination by Employer); or b) terminate her for violating her probationary contract. Explain. (5%) -XIII- Matibay Shoe and Repair Store, as added service to its customers, devoted a portion of its store to a shoe shine stand. The shoe shine boys were tested for their skill before being allowed to work and given ID cards. They were told to be present from the opening of the store up to closing time and were· required to follow the company rules on cleanliness and decorum. They bought their own shoe shine 23 boxes, polish, and rags. The boys were paid by their customers for their services but the payment is coursed through the store’s cashier, who pays them before closing time. They were not supervised in their work by any managerial employee of the store but for a valid complaint by a customer or for violation of any company rule, they can be refused admission to the store. Were the boys employees of the store? Explain. (5%) -XIV- Tess, a seamstress at Marikit Clothing Factory, became pregnant. Because of morning sickness, she frequently absented herself from work and often came to the factory only four (4) days a week. After two (2) months, the personnel manager told her that her habitual absences rendered her practically useless to the company and, thus, asked her to resign. She begged to be retained, citing her pregnancy as reason for her absences. Tess asked for leave of absence but her request was denied. She went on leave nevertheless. As a result, she was thus dismissed for going on leave without permission of management. Tess filed a complaint for illegal dismissal. The company’s defense: she was legally dismissed because of her numerous absences without leave and not because of her pregnancy. On the other hand, Tess argues that her dismissal was an act of discrimination, based as it was on her pregnancy which the company treated as a disease. Whose position is meritorious-the company’s or Tess’? Explain. (5%) -XV- Jim is the holder of a certificate of public convenience for a jeepney. He entered into a contract of lease with Nick, whereby they agreed that the lease period is for one (1) year unless sooner terminated by Jim for any of the causes laid down in the contract. The rental is thirty thousand pesos (P30,000.00) monthly. All the expenses for the repair ofthe jeepney, together with expenses for diesel, oil and service, shall be for the account of Nick. Nick is required to make a deposit of three (3) months to answer for the restoration of the vehicle to its good operating condition when the contract ends. It is stipulated that Nick is not an employee of Jim and he holds the latter free and harmless from all suits or claims which may arise from the implementation of the contract. Nick has the right to use the jeepney at any hour of the day provided it is operated on the approved line o f operation. After five (5) months of the lease and payment of the rentals, Nick became delinquent in the payment ofthe rentals for two (2) months. Jim, as authorized by the contract, sent a letter of demand rescinding the contract and asked for the arrearages. Nick responded by filing a complaint with the NLRC for illegal dismissal, claiming that the contract is illegal and he was just forced by Jim to sign it so he can drive. He claims he is really a driver of Jim on a boundary system and the reason he was removed is because he failed to pay the complete daily boundary of one thousand (P1,000.00) for 2 months due to the increase in the number of tricycles. [a] Jim files a motion to dismiss the NLRC case on the ground that the regular court has jurisdiction since the agreement is a lease contract. Rule on the motion and explain. (2.5%) [b] Assuming that Nick is an employee of Jim, was Nick validly dismissed? -XVI- In a case for illegal dismissal and non-payment of benefits, with prayer for Damages·, Apollo was awarded the following: 1) P200,000.00 as back.wages; 2) P80,000.00 as unpaid wages; 3) P20,000.00 as unpaid holiday pay; 4) PS,000.00 as unpaid service incentive leave pay; 5) P50,000.00 as moral damages; and 6) Pl0,000.00 as exemplary damages. Attorney’s fees of ten percent (10%) of all the amounts covered by items 1 to 6 inclusive, plus interests of 6% per annum from the date the same were unlawfully withheld, were also awarded. 24 [a] Robbie, the employer, contests the award of attorney fees amounting to 10% on all the amounts adjudged on the ground that Article 111 ofthe Labor Code authorizes only 10% “of the amount of wages recovered”. Rule on the issue and explain. (2.5%) [b] Robbie likewise questions the imposition of interests on the amounts in question because it was not claimed by Apollo, and the Civil Code provision on interests does not apply to a labor case. Rule on the issue and explain. (2.5%) -XVII- Baldo, a farm worker on pakyaw basis, had been working on Dencio’s land by harvesting abaca and coconut, processing copra, and clearing weeds from year to year starting January 1993 up to his death in 2007. He worked continuously in the sense that it was done for more than one harvesting season. [a] Was Dencio required to report Baldo for compulsory social security coverage under the SSS law? Explain. (2.5%) [b] What are the liabilities of the employer who fails to report his employee for social security coverage? Explain. (2.5%) -XVIII- Empire Brands (Empire) contracted the services of Style Corporation (Style) for the marketing and promotion of its clothing line. Under the contract, Style provided Empire with Trade Merchandising Representatives (TMRs) whose services began on September 15, 2004 and ended on June 6, 2007, when Empire terminated the promotions contract with Style. Empire then entered into an agreement for manpower supply with Wave Human Resources (Wave). Wave owns its condo office, owns equipment for the use by the TMRs, and has assets amounting to Pl,000,000.00. Wave provided the supervisors who supervised the TMRs, who, in tum, received orders from the Marketing Director of Empire. In their agreement, the parties stipulated that Wave shall be liable for the wages and salaries of its employees or workers, including benefits, and protection due them, as well as remittance to the proper government entities of all withholding taxes, Social Security Service, and Philhealth premiums, in accordance with relevant laws. As the TMRs wanted to continue working at Empire, they submitted job applications as TMRs with Wave. Consequently, Wave hired them for a term of five (5) months, or from June 7, 2007 to November 6, 2007, specifically to promote Empire’s products. When the TMRs’ 5-month contracts with Wave were about to expire, they sought renewal thereof, but were refused. Their contracts with Wave were no longer renewed as Empire hired another agency. This prompted them to file complaints for illegal dismissal, regularization, non-payment of service incentive leave and 13th month pay against Empire and Wave. [a] Are the TMRs employees of Empire? (2.5%) [b] Were the TMRs illegally dismissed by Wave? (2.5%) -XIX- Filmore Corporation was ordered to pay P49 million to its employees by the Labor Arbiter. It interposed an appeal by filing a Notice of Appeal and paid the corresponding appeal fee. However, instead of filing the required appeal bond equivalent to the total amount of the monetary award, Filmore filed a Motion to Reduce the Appeal Bond to P4,000,000.00 but submitted a surety bond in the amount of P4.9 million. Filmore cited financial difficulties as justification for its inability to post the appeal bond in full owing to 25 the shutdown of its operations. It submitted its audited financial statements showing a loss of P40 million in the previous year. To show its good faith, Filmore also filed its Memorandum of Appeal. The NLRC dismissed the appeal for non-perfection on the ground that posting of an appeal bond equivalent to the monetary award is indispensable for the perfection of the appeal and the reduction of the appeal bond, absent any showing of meritorious ground to justify the same, is not warranted. Is the dismissal ofthe appeal correct? Explain. (5%) -XX- Mario Brothers, plumbing works contractor, entered into an agreement with Axis Business Corporation (Axis) for the plumbing works of its building under construction. Mario Brothers engaged the services of Tristan, Arthur, and Jojo as plumber, pipe fitter, and threader, respectively. These workers have worked for Mario Brothers in numerous construction projects in the past but because of their long relationship, they were never asked to sign contracts for each project. No reports to government agencies were made regarding their work in the company. During the implementation of the works contract, Axis suffered financial difficulties and was not able to pay Mario Brothers its past billings. As a result, the three (3) employees were not paid their salaries for two (2) months and their 13th month pay. Because Axis cannot pay, Mario Brothers cancelled the contract and laid off Tristan, Arthur, and Jojo. The 3 employees sued Mario Brothers and Axis for illegal dismissal, unpaid wages, and benefits. [a] Mario Brothers claims the 3 workers are project employees. It explains that the agreement is, if the works contract is cancelled due to the fault of the client, the period of employment is automatically terminated. Is the contractor correct? Explain. (2.5%) [b] Can Axis be made solidarily liable with Mario Brothers to pay the unpaid wages and 13th month pay o f Tristan, Arthur, and Jojo? Explain. (2.5%) TAXATION LAW -I- Briefly explain the following doctrines: lifeblood doctrine; necessity theory; benefits received principle; and, doctrine of symbiotic relationship. (5%) -II- State at least five (5) cases under the exclusive appellate jurisdiction of the Court of Tax Appeals (CTA). (5%) -III- Rakham operates the lending company that made a loan to Alfonso in the amount of P120,000.00 subject of a promissory note which is due within one (1) year from the note’s issuance. Three years after the loan became due and upon information that Alfonso is nowhere to be found, Rakham asks you for advice on how to treat the obligation as “bad debt.” Discuss the requisites for deductibility of a “bad debt?” (5%) -IV- The City of Maharlika passed an ordinance imposing a tax on any sale or transfer ofreal property located within the city at a rate offifty percent (50%) ofone percent (1%) of the total consideration of the transaction. Jose sold a parcel of land in the city, which he inherited from his deceased parents, and 26 refused to pay the aforesaid tax. He instead filed a case asking that the ordinance be declared null and void since the tax it imposed can only be collected by the national government, as in fact he has paid the Bureau of Internal Revenue (BIR) the required capital gains tax. Ifyou were the City Legal Officer of Maharlika, what defenses would you raise to sustain the validity ofthe ordinance? (5%) -V- Sure Arrival Airways (SAA) is a foreign corporation, organized under the laws of the Republic of Nigeria. Its commercial airplanes do not operate within Philippine territory, or service passengers embarking from Philippine airports. The firm is represented in the Philippines by its general agent, Narotel. SAA sells airplane tickets through Narotel, and these tickets are serviced by SAA airplanesoutsidethePhilippines. The total sales of airplane tickets transacted by Narotel for SAA in 2012 amounted to Pl0,000,000.00. The Commissioner of Internal Revenue (CIR) assessed SAA deficiency income taxes at the rate of 30% on its taxable income, finding that SAA’s airline ticket sales constituted income derived from sources within the Philippines. SAA filed a protest on the ground that the alleged deficiency income taxes should be considered as income derived exclusively from sources outside the Philippines since SAA only serviced passengers outside Philippine territory. It, thus, asserted that the imposition of such income taxes violated the principle o f territoriality in taxation. Is the theory of SAA tenable? Explain. (5%) -VI- Mapagbigay Corporation grants all its employees (rank and file, supervisors, and managers) 5% discount of the purchase price of its products. During an audit investigation, the BIR assessed the company the corresponding tax on the amount equivalent to the courtesy discount received by all the employees, contending that the courtesy discount is considered as additional compensation for the rank and file employees and additional fringe benefit for the supervisors and managers. In its defense, the company argues that the discount given to the rank and file employees is a de minimis benefit and not subject to tax. As to its managerial employees, it contends that the discount is nothing more than a privilege and its availment is restricted. Is the BIR assessment correct? Explain. (5%) -VII- Philippine National Railways (PNR) operates the rail transport of passengers and goods by providing train stations and freight customer facilities from Tutuban, Manila to the Bicol Province. As the operator of the railroad transit, PNR administers the land, improvements and equipment within its main station in Tutuban, Manila. Invoking Section 193 ofthe Local Government Code (LGC) expressly withdrawing the tax exemption privileges of government-owned and controlled corporations upon the effectivity of the Code in 1992, the City Government of Manila issued Final Notices of Real Estate Tax Deficiency in the amount of P624,000,000.00 for the taxable years 2006 to 2010. On the other hand, PNR, seeking refuge under the principle that the government cannot tax itself, insisted that the PNR lands and buildings are owned by the Republic. Is the PNR exempt from real property tax? Explain your answer. (5%) -VIII- In 2011, Solar Computer Corporation (Solar) purchased a proprietary membership share covered by Membership Certificate No. 8 from the Mabuhay Golf Club, Inc. for PS00,000.00. On December 27, 27 2012, it transferred the same to David, its American consultant, to enable him to avail ofthe facilities ofthe Club. David executed a Deed of Declaration of Trust and Assignment of Shares wherein he acknowledged the absolute ownership of Solar over the share; that the assignment was without any consideration; and that the share was placed in his name because the Club required it to be done. In 2013, the value o f the share increased to P800,000.00. Is the said assignment a “gift” and, therefore, subject to gift tax? Explain. (5%) IX- [a] Explain the procedure for claiming refunds or tax credits of input Value Added Tax (VAT) for zero- rated or effectively zero-rated sales under Sec. 112 of the National Internal Revenue Code (NIRC) from the filing of an application with the CIR up to the CTA. (2.5%) [b] Explain the procedure for claiming refunds of tax erroneously or illegally collected under Sec. 229 ofthe NIRC from the filing ofthe claim for refunds withtheCIRuptotheCTA. (2.5%) -X- Congress issued a law allowing a 20% discount on the purchases of senior citizens from, among others, recreation centers. This 20% discount can then be used by the sellers as a “tax credit.” At the initiative of BIR, however, Republic Act No. (RA) 9257 was enacted amending the treatment ofthe 20% discount as a “tax deduction.” Equity Cinema filed a petition with the RTC claiming that RA 9257 is unconstitutional as it forcibly deprives sellers a part ofthe price without just compensation. [a] What is the effect of converting the 20% discount from a “tax credit” to a “tax deduction”? (2.5%) [b] I f you are the judge, how will you decide the case? Briefly explain your answer. (2.5%) -XI- Soaring Eagle paid its excise tax liabilities with Tax Credit Certificates (TCCs) which it purchased through the One Stop Shop Inter-Agency Tax Credit Center (Center) of the Department o f Finance. The Center is a composite body o f the DOF, BIR, BOC and the BOI. The TCCs Were accepted by the BIR as payments. A year after, the BIR demanded the payment of alleged deficiency excise taxes on the ground that Soaring Eagle is not a qualified transferee of the TCCs it purchased from other BOI- registered companies. The BIR argued that the TCCs are subject to post-audit as a suspensive condition. On the other hand, Soaring Eagle countered that it is a buyer in good faith and for value who merely relied on the Center’s representation ofthe genuineness and validity of the TCCs. If it is ordered to pay the deficiency, Soaring Eagle claims the same is confiscatory and a violation ofdue process. Is the assessment against Soaring Eagle valid? Explain. (5%) -XII- The Philippine-British Association, Inc. (Association) is a non-stock, non-profit organization which owns the St. Michael’s Hospital (Hospital). Sec. 216 in relation to Sec. 215 of the LGC classifies all lands, buildings and other improvements thereon actually, directly, and exclusively used for hospitals as “special.” A special classification prescribes a lower assessment than a commercial classification. Within the premises ofthe Hospital, the Association constructed the St. Michael’s Medical Arts Center (Center) which will house medical practitioners who will lease the spaces therein for their clinics at prescribed rental rates. The doctors who treat the patients confined in the Hospital are accredited by the Association. The City Assessor classified the Center as “commercial” instead of”special” on the ground that the Hospital owner gets income from the lease of its spaces to doctors who also entertain out-patients. Is the City Assessor correct in classifying the Center as “commercial?” Explain. (5%) 28 -XIII- BPursuant to Sec. 11 of the “Host Agreement” between the United Nations and the Philippine government, it was provided that the World Health Organization (WHO), “its assets, income and other properties shall be : a) exempt from all direct and indirect taxes.” Precision Construction Corporation (PCC) was hired to construct the WHO Medical Center in Manila. Upon completion ofthe building, the BIR assessed a 12% VAT on the gross receipts of PCC derived from the construction of the WHO building. The BIR contends that the 12% VAT is not a direct nor an indirect tax on the WHO but a tax that is primarily due from the contractor and is therefore not covered by the Host Agreement. The WHO argues that the VAT is deemed an indirect tax as PCC can shift the tax burden to it. Is the BIR correct? Explain. (5%) -XIV- Lucky V Corporation (Lucky) owns a IO-storey building on a 2,000 square meter lot in the City of Makati. It sold the lot and building to Rainier. for P80 million. One month after, Rainier sold the lot and building to Healthy Smoke Company (HSC) for P200 million. Lucky filed its annual tax return and declared its gain from the sale ofthe lot and building in the amount ofP750,000.00. An investigation conducted by the BIR revealed that two months prior to the sale ofthe properties to Rainier, Lucky received P40 million from HSC and not from Rainier. Said amount ofP40 million was debited by HSC and reflected in its trial balance as “other inv. – Lucky Bldg.” The month after, another P40 million was reflected in HSC’s trial balance as “other inv. – Lucky Bldg.” The BIR concluded that there is tax evasion since the real buyer ofthe properties of Lucky is HSC and not Rainier. It issued an assessment for deficiency income tax in the amount of P79 million against Lucky. Lucky argues that it resorted to tax avoidance or a tax saving device, which is allowed by the NIRC and BIR rules since it paid the correct taxes based on its sale to Rainier. On the other hand, Rainier and HSC also paid the prescribed taxes arising from the sale by Rainier to HSC. Is the BIR correct in assessing taxes on Lucky? Explain. (5%) XV- Peter is the Vice-President for Sales of Golden Dragon Realty Conglomerate, Inc. (Golden Dragon). A group of five (5) foreign investors visited the country for possible investment in the condominium units and subdivision lots ofGolden Dragon. After a tour ofthe properties for sale, the investors were wined and dined by Peter at the posh Conrad’s Hotel at the cost of Pl 50,000.00. Afterward, the investors were brought to a party in a videoke club which cost the company P200,000.00 for food and drinks, and the amount of P80,000.00 as tips for business promotion officers. Expenses at Conrad’s Hotel and the videoke club were receipted and submitted to support the deduction for representation and entertainment expenses. Decide if all the representation and entertainment expenses claimed by Golden Dragon are deductible. Explain. (5%) -XVI- Amor Powers, Inc. (API) is a domestic corporation registered with the BIR as a value-addedtaxpayer. API incurred excess input VAT in the amount of P500,000,000.00 on August 3, 2008. Hence, it filed with the BIR an administrative claim for the refund or credit ofthese input taxes on August 15, 2010. Without waiting for the CIR to act on its claim, API filed a Petition for Review with the CTA on September 15, 2010 before the lapse oftwo years after the close ofthe taxable quarter concerned. In its Comment on the Petition, the CIR argues that API’s Petition should be dismissed as it was filed before the lapse of the 120-day period given to the CIR by Sec. 112(D) ofthe NIRC, which became effective on January 1, 1998. For the CIR, the 120- day period is mandatory and jurisdictional so that any suit filed before its expiration is premature and, therefore, dismissible. API, on the other hand, invokes BIR Ruling No. DA-489-03 issued by the CIR on December 10, 2003 in answer to a query posed by the Department of Finance regarding the propriety ofthe actions taken by Lazi Bay Resources Development, Inc., which filed an administrative claim for refund with the CIR 29 and, before the lapse of the 120-day period from its filing, filed a judicial claim with the CTA. BIR Ruling No. DA-489-03 stated that the taxpayer-claimant need not wait for the lapse ofthe 120-day period before it could seek judicial relief with the CTA. Will API’s Petition for Review prosper? Decide with reasons. (5%) -XVII- The requisites for a valid waiver of the three-year (3-year) prescriptive period for the BIR to assess taxes due in the taxable year are prescribed by Revenue Memorandum Order (RMO) No. 20-90: 1. The waiver must be in the proper form prescribed by RMO 20-90. 2. The waiver must be signed by the taxpayer himself or his duly authorized representative. In the case o f a corporation, the waiver must be signed by any of its responsible officials. In case the authority is delegated by the taxpayer to a representative, such delegation should be in writing and duly notarized. 3. The waiver should be duly notarized. 4. The CIR or the revenue official authorized by him must sign the waiver indicating that the BIR has accepted and agreed to the waiver. The date of such acceptance by the BIR should be indicated. However, before signing the waiver, the CIR or the revenue official authorized by him must make sure that the waiver is in the prescribed form, duly notarized, and executed by the taxpayer or his duly authorized representative. 5. Both the date of execution by the taxpayer and date of acceptance by the Bureau should be before the expiration of the period of prescription or before the lapse ofthe period agreed upon in case a subsequent agreement is executed. 6. The waiver must be executed in three copies, the original copy to be attached to the docket of the case, the second copy for the taxpayer and the third copy for the Office accepting the waiver. The fact of receipt by the taxpayer ofhis/her file copy must be indicated in the original copy to show that the taxpayer was notified ofthe acceptance ofthe BIR and the perfection of the agreement. After being assessed by the BIR with alleged deficiency income taxes, VVV Corporation (VVV) through Enrique, its President, executed a waiver ofthe prescriptive period. The waiver was signed by Revenue District Officer (RDO) Alfredo. However, the waiver did not state the date of execution by the taxpayer and date of acceptance by the BIR. Enrique was also not furnished a copy of the waiver by the BIR. VVV claims that the waiver is void due to non-compliance with RMO 20-90. Hence, the period for assessment had already prescribed. Moreover, since the assessment involves P2 million, the waiver should have been signed by the CIR and instead ofa mere RDO. On the other hand, the BIR contends that the requirements of RMO No. 20-90 are merely directory; that the execution o f the waiver by VVV was a renunciation o f its right to invoke prescription and that the government cannot be estopped by the mistakes committed by its revenue officers. Is VVV liable? Explain. (5%) -XVIII- Henry, a U.S. naturalized citizen, went home to the Philippines to reacquire Philippine citizenship under RA 9225. His mother left him a lot and building in Makati City and he wants to make use of it in his trading business. Considering that he needs money for the business, he wants to sell his lot and building and make use of the consideration. However, the lot has sentimental value and he wants to reacquire it in the future. A friend o f Henry told him o f the “sale-leaseback transaction” commonly used in the 30 U.S., which is also used for tax reduction. Under said transaction, the lot owner sells his property to a buyer on the condition that he leases it back from the buyer. At the same time, the property owner is granted an option to repurchase the lot on or before an agreed date. Henry approaches you as a tax lawyer for advice. Explain what tax benefits, if any, can be obtained by Henry and the buyer from the sale-leaseback transaction? (5%) XIX- Jennifer is the only daughter of Janina who was a resident in Los Angeles, California, U.S.A. Janina died in the U.S. leaving to Jennifer one million shares of Sun Life (Philippines), Inc., a corporation organized and existing under the laws of the Republic of the Philippines. Said shares were held in trust for Janina by the Corporate Secretary of Sun Life and the latter can vote the shares and receive dividends for Janina. The Internal Revenue Service (IRS) ofthe U.S. taxed the shares on the ground that Janina was domiciled in the U.S. at the time o f her death. [a] Can the CIR ofthe Philippines also tax the same shares? Explain. (2.5%) [b] Explain the concept of double taxation. (2.5%) XX- Patrick is a successful businessman in the United States and he is a sole proprietor of a supermarket which has a gross sales of $10 million and an annual income of $3 million. He went to the Philippines on a visit and, in a party, he saw Atty. Agaton who boasts ofbeing a tax expert. Patrick asks Atty. Agaton: ifhe (Patrick) decides to reacquire his Philippine citizenship under RA 9225, establish residence in this country, and open a supermarket in Makati City, will the BIR tax him on the income he earns from his U.S. business? If you were Atty. Agaton, what advice will you give Patrick? (5%) REMEDIAL LAW -I- State at least five (5) civil cases that fall under the exclusive original jurisdiction of the Regional Trial Courts (RTCs). (5%) -II- [a] Briefly explain the procedure on “Interrogatories to Parties” under Rule 25 and state the effect of failure to serve written interrogatories. (2.5%) [b] Briefly explain the procedure on “Admission by Adverse Party” under Rule 26 and the effect o f failure to file and serve the request. (2.5%) -III- What are the contents of a judicial affidavit? (5%) -IV- Eduardo, a resident of the City of Manila, filed before the Regional Trial Court (RTC) of Manila a complaint for the annulment of a Deed of Real Estate Mortgage he signed in favor of Galaxy Bank (Galaxy), and the consequent· foreclosure and auction sale of his mortgaged Makati property. Galaxy filed a Motion to Dismiss on the ground of improper venue alleging that the complaint should be filed 31 with the RTC of Makati since the complaint involves the ownership and possession ofEduardo’s lot. Resolve the motion with reasons. (5%) -V- [a] What is the “most important witness” rule pursuant to the 2004 Guidelines of Pretrial and Use of Deposition-Discovery Measures? Explain. (2.5%) [b] What is the “one day examination of witness” rule pursuant to the said 2004 Guidelines? Explain. (2.5%) VI- Pedro and Juan are residents of Barangay Ifurug, Municipality of Dupac, Mountain Province. Pedro owes Juan the amount of P50,000.00. Due to non- payment, Juan brought his complaint to the Council of Elders of said barangay which implements the bodong justice system. Both appeared before the council where they verbally agreed that Pedro will pay in installments on specific due dates. Pedro reneged on his promise. Juan filed a complaint for sum of money before the Municipal Trial Court (MTC). Pedro filed a Motion to Dismiss on the ground that the case did not pass through the barangay conciliation under R.A. No. 7160 and that the RTC, not the MTC, has jurisdiction. In his opposition, Juan argued that the intervention ofthe Council ofElders is substantial compliance with the requirement of R.A. No. 7160 and the claim of P50,000.00 is clearly within the jurisdiction ofthe MTC. As MTC judge, rule on the motion and explain. (5%) -VII- Spouses Marlon and Edith have three (3) children ages 15, 12 and 7, who are studying at public schools. They have a combined gross monthly income of P30,000.00 and they stay in an apartment in Manila with a monthly rent of PS,000.00. The monthly minimum wage per employee in Metro Manila does not exceed P13,000.00. They do not own any real property. The spouses want to collect a loan of P25,000.00 from Jojo but do not have the money to pay the filing fees. [a] Would the spouses qualify as indigent litigants under Section 19, Rule 141 on Legal Fees? (2.5%) [b] If the spouses do not qualify under Rule 141, what other remedy can they avail of under the rules to exempt them from paying the filing fees? (2.5%) -VIII- Juan sued Roberto for specific performance. Roberto knew that Juan was going to file the case so he went out oftown and temporarily stayed in another city to avoid service of summons. Juan engaged the services of Sheriff Matinik to serve the summons but when the latter went to the residence of Roberto, he was told by the caretaker thereof that his employer no longer resides at the house. The caretaker is a high school graduate and is the godson of Roberto. Believing the caretaker’s story to be true, Sheriff Matinik left a copy of the summons and complaint with the caretaker. Was there a valid substituted service of summons? Discuss the requirements for a valid service of summons. (5%) -IX- [a] Is the buyer in the auction sale arising from an extra-judicial foreclosure entitled to a writ of possession even before the expiration ofthe redemption period? If so, what is the action to be taken? (1%) 32 [b] After the period of redemption has lapsed and the title to the lot is consolidated in the name ofthe auction buyer, is he entitled to the writ of possession as a matter o f right? If so, what is the action to be taken? (2%) [c] Suppose that after the title to the lot has been consolidated in the name of the auction buyer, said buyer sold the lot to a third party without first getting a writ of possession. Can the transferee exercise the right of the auction buyer and claim that it is a ministerial duty ofthe court to issue a writ ofpossession in his favor? Briefly explain. (2%) -X- Hannibal, Donna, Florence and Joel, concerned residents of Laguna de Bay, filed a complaint for mandamus against the Laguna Lake Development Authority, the Department of Environment and Natural Resources, the Department of Public Work and Highways, Department of Interior and Local Government, Department of Agriculture, Department of Budget, and Philippine National Police before the RTC of Laguna alleging that the continued neglect of defendants in performing their duties has resulted in serious deterioration of the water quality ofthe lake and the degradation of the marine life in the lake. The plaintiffs prayed that said government agencies be ordered to clean up Laguna de Bay and restore its water quality to Class C waters as prescribed by Presidential Decree No. 1152, otherwise known as the Philippine Environment Code. Defendants raise the defense that the cleanup of the lake is not a ministerial function and they cannot be compelled by mandamus to perform the same. The RTC of Laguna rendered a decision declaring that it is the duty of the agencies to clean up Laguna de Bay and issued a permanent writ of mandamus ordering said agencies to perform their duties prescribed by law relating to the cleanup of Laguna de Bay. [a] Is the RTC correct in issuing the writ of mandamus? Explain. (2.5%) [b] What is the writ of continuing mandamus? (2.5%) -XI- Miguel filed a Complaint for damages against Jose, who denied liability and filed a Motion to Dismiss on the ground of failure to state a cause of action. In an Order received by Jose on January 5, 2015, the trial court denied the Motion to Dismiss. On February 4, 2015, Jose sought reconsideration of that Order through a Motion for Reconsideration. Miguel opposed the Motion for Reconsideration on the ground that it was filed out of time. Jose countered that the 15-day rule under Section 1 of Rule 52 does not apply where the Order sought to be reconsidered is an interlocutory order that does not attain finality. Is Jose correct? Explain. (5%) -XII- Tailors Toto, Nelson and Yenyen filed a special civil action for certiorari under Rule 65 from an adverse decision of the National Labor Relations Commission (NLRC) on the complaint for illegal dismissal against Empire Textile Corporation. They were terminated on the ground that they failed to meet the prescribed production quota at least four (4) times. The NLRC decision was assailed in a special civil action under Rule 65 before the Court of Appeals (CA). In the verification and certification against forum shopping, only Toto signed the verification and certification, while Atty. Arman signed for Nelson. Empire filed a motion to dismiss on the ground of defective verification and certification. Decide with reasons. (5%) -XIII- The officers of”Ang Kapaligiran ay Alagaan, Inc.” engaged your services to file an action against ABC Mining Corporation which is engaged in mining operations in Sta. Cruz, Marinduque. ABC used highly toxic chemicals in extracting gold. ABC’s toxic mine tailings were accidentally released from its storage dams and were discharged into the rivers of said town. The mine tailings found their way to Calancan 33 Bay and allegedly to the waters of nearby Romblon and Quezon. The damage to the crops and loss of earnings were estimated at Pl Billion. Damage to the environment is estimated at Pl Billion. As lawyer for the organization, you are requested to explain the advantages derived from a petition for writ of kalikasan before the Supreme Court over a complaint for damages before the RTC of Marinduque or vice-versa. What action will you recommend? Explain. (5%) -XIV- Pedro, the principal witness in a criminal case, testified and completed his testimony on direct examination in 2015. Due to several postponements by the accused, grounded on his recurring illness, which were all granted by the judge, the cross-examination of Pedro was finally set on October 15, 2016. Before the said date, Pedro died. The accused moved to expunge Pedro’s testimony on the ground that it violates his right ofconfrontation and the right to cross-examine the witness. The prosecution opposed the motion and asked that Pedro’s testimony on direct examination be admitted as evidence. Is the motion meritorious? Explain. (5%) -XV- Chika sued Gringo, a Venezuelan, for a sum of money. The Metropolitan Trial Court of Manila (MeTC) rendered a decision ordering Gringo to pay Chika P50,000.00 plus legal interest. During its pendency of the appeal before the RTC, Gringo died of acute hemorrhagic pancreatitis. Atty. Perfecto, counsel of Gringo, filed a manifestation attaching the death certificate of Gringo and informing the RTC that he cannot substitute the heirs since Gringo did not disclose any information on his family. As counsel for Chika, what remedy can you recommend to your client so the case can move forward and she can eventually recover her money? Explain. (5%) -XVI- Under Section 5, Rule 113 a warrantless arrest is allowed when an offense has just been committed and the peace officer has probable cause to believe, based on his personal knowledge of facts or circumstances, that the person to be arrested has committed it. A policeman approaches you for advice and asks you how he will execute a warrantless arrest against a murderer who escaped after killing a person. The policeman arrived two (2) hours after the killing and a certain Max was allegedly the killer per information given by a witness. He asks you to clarify the following: [a] How long after the commission of the crime can he still execute the warrantless arrest? (2.5%) [b] What does “personal knowledge of the facts and circumstances that the person to be arrested committed it” mean? (2.5%) -XVII- The information against Roger Alindogan for the crime of acts lasciviousness under Article 336 ofthe Revised Penal Code avers: “That on or about 10:30 o’clock in the evening of February 1, 2010 at Barangay Matalaba, Imus, Cavite and within the jurisdiction of this Honorable Court, the above-named accused, with lewd and unchaste design, through force and intimidation, did then and there, wilfully, unlawfully and feloniously commit sexual abuse on his daughter, Rose Domingo, a minor of 11 years old, either by raping her or committing acts of lasciviousness on her, against her will and consent to her damage and prejudice. ACTS CONTRARY TO LAW.” The accused wants to have the case dismissed because he believes that the charge is confusing and the information is defective. What ground or grounds can he raise in moving for the quashal ofthe information? Explain. (5%) 34 -XVIII- John filed a petition for declaration of nullity of his marriage to Anne on the ground of psychological incapacity under Article 36 of the Family Code. He obtained a copy of the confidential psychiatric evaluation report on his wife from the secretary of the psychiatrist. Can he testify on the said report without offending the rule on privileged communication? Explain. (5%) -XIX- Tristan filed a suit with the RTC of Pasay against Arthur King and/or Estate of Arthur King for reconveyance of a lot declared in the name of Arthur King under TCT No. 1234. The complaint alleged that “on account Arthur King’s residence abroad up to the present and the uncertainty of whether he is still alive or dead, he or his estate may be served with summons by publication.” Summons was published and nobody filed any responsive pleading within sixty (60) days therefrom. Upon motion, defendants were declared in default and judgment was rendered declaring Tristan as legal owner and ordering defendants to reconvey said lot to Tristan. Jojo, the court-designated administrator of Arthur King’s estate, filed a petition for annulment of judgment before the CA praying that the decision in favor of Tristan be declared null and void for lack of jurisdiction. He claims that the action filed by Tristan is an action in personam and that the court did not acquire jurisdiction over defendants Arthur King and/or his estate. On the other hand, Tristan claims that the suit is an action in rem or at least an action quasi in rem. Is the RTC judge correct in ordering service of summons by publication? Explain. (5%) -XX- Royal Bank (Royal) filed a complaint for a sum of money against Ervin and Jude before the RTC of Manila. The initiatory pleading averred that on February 14, 2010, Ervin obtained a loan from Royal in the amount of Pl Million, as evidenced by Promissory Note No. 007 (PN) signed by Ervin. Jude signed a Surety Agreement binding herself as surety for the loan. Royal made a final demand on February 14, 2015 for Ervin and Jude (defendants) to pay, but the latter failed to pay. Royal prayed that defendants Ervin and Jude be ordered to pay the amount of Pl Million plus interests. In their answer, Ervin admitted that he obtained the loan from Royal and signed the PN. Jude also admitted that she signed the Surety Agreement. Defendants pointed out that the PN did not provide the due date for payment, and that the loan has not yet matured as the maturity date was left blank to be agreed upon by the parties at a later date. Defendants filed a Motion for a Judgment on the Pleadings on the ground that there is no genuine issue presented by the parties’ submissions. Royal opposed the motion on the ground that the PN’s maturity is an issue that must be threshed out during trial. [a] Resolve the motion with reasons. (2.5%) [b] Distinguish “Summary Judgment” and “Judgment on the Pleadings.” (2.5%) LEGAL ETHICS -I- State the duties of a lawyer imposed by the Lawyer’s Oath. (5%) -II- State at least five (5) instances where judges should disqualify themselves from participating in any proceedings where their impartiality might reasonably be questioned. (5%) -III- 35 Differentiate “retaining lien” from “charging lien.” (5%) -IV- [a] A sign was posted at the building where the law office of Atty. Redentor Walang-Talo is located. The sign reads: Atty. Redentor A. Walang-Talo Chairman, IBP Legal Aid Committee Makati City IBP Chapter Free conciliation, mediation and court representation Suite 210, Galaxy Building, J. P. Rizal Street, Makati City Does the posting constitute solicitation? (2.5%) [b] Suppose the sign reads: Atty. Redentor A. Walang-Talo Attorney and Counselor-at-Law General Practitioner (Accepts pro bono cases pursuant to the IBP Legal Aid Program) Does the posting constitute solicitation? (2.5%) -V- Constantino was accused of estafa by Hazel, the wife of Judge Andres, for misappropriating the ring she entrusted to him. Since Judge Andres was present when Hazel handed the ring to Constantino, he was compelled by his wife to testify as a witness for the prosecution in the criminal case. Did the judge commit any violation of the New Code of Judicial Conduct for the Philippine Judiciary? Explain. (5%) -VI- Andrew engaged the services of Atty. Juju under a contingent fee agreement to help him file a complaint for damages against his employer, Wilkon Shipping, Inc. Atty. Juju handled Andrew’s case for two (2) years before the Labor Arbiter and the National Labor Relations Commission (NLRC), filing the necessary pleadings and attending several hearings. The complaint, however, was dismissed. To improve his chances, Andrew replaced Atty. Juju with Atty. Jen, who eventually succeeded in getting a favorable decision from the Court of Appeals, which became final. When Andrew’s claims were satisfied by Wilkon, Atty. Juju filed a collection suit against him claiming that he (Atty. Juju) is entitled to attorney’s fees for the services he rendered for two (2) years. Will the collection suit prosper? Explain. (5%) -VII- Apollo hired Atty. Dennis to file an action for damages. Since Apollo has no money, he entered into a contingent fee agreement where Atty. Dennis will shoulder all expenses of litigation and will not charge for legal services. In case of a favorable decision, Apollo agreed to transfer to his lawyer a lot in Cebu. Eventually, Apollo won the case. Atty. Dennis asked Apollo to execute the deed of sale, but the latter refused upon advice of a friend that the agreement is illegal. Due to threats of legal action by his lawyer, Apollo filed a complaint before the Supreme Court alleging that the agreement is a champertous contract. Rule on the legality of the agreement on contingent fee and the propriety of getting the property of Apollo. Explain. (5%) -VIII- Arthur hired Atty. Jojo to file a complaint for the collection of P500,000.00. He agreed to pay Atty. Jojo the amounts of P100,000.00 as acceptance fee and P100,000.00 as success fee. Arthur paid 36 P50,000.00 as partial payment of the acceptance fee with the promise to pay the balance ofP50,000.00 after presentation of Arthur’s evidence. During the pre-trial, the defendant paid to Atty. Jojo the amount ofPl00,000.00 as partial payment ofhis debt. Considering that he has not yet been paid of the balance ofhis acceptance fee, Atty. Jojo applied P50,000.00 to the balance of the acceptance fee and the remaining P50,000.00 was deposited in his bank account for safekeeping. Despite the lapse of one ( 1) month, Arthur was not informed of the payment. Arthur sued Atty. Jojo for keeping the money and argues that the latter violated the rules under Canon 16 of the CPR that a lawyer shall hold in trust all monies of his client that may come into his possession. Atty. Jojo claims he has a lien on the monies paid to him by the defendant. Rule on the complaint and explain. (5%) -IX- Atty. Tristan filed a motion to disqualify Judge Robert from hearing a civil case on the ground that the latter was the classmate and fraternity brother of Atty. Mark, Atty. Tristan’s opposing counsel. Judge Robert denied the motion on the ground that under Rule 3.12 of the Code of Judicial Conduct, he is not required to inhibit in all cases where his classmates and fraternity brothers are participating lawyers in cases before him. Is Judge Robert correct in denying the motion? (5%) -X- Atty. Harold wrote in the Philippine Star his view that the decision of the Supreme Court in a big land case is incorrect and should be re-examined. The decision is not yet final. Atty. Alfonso, the counsel for the winning party in that case, filed a complaint for disbarment against Atty. Harold for violation of the sub judice rule and Canon 11 of the CPR that a lawyer shall observe and maintain the respect due to the courts. Explain the sub judice rule and rule on the disbarment case. (5%) -XI- George, an American citizen doing business in the Philippines, bought a lot in Manila and secured the services o f Atty. Henry for the execution o f the required documents. Atty. Henry prepared a Deed of Sale of Land using the name of George’s friend, Pete, as the buyer. In order to protect George’s interests and ensure his free and undisturbed use ofthe property for an indefinite period of time, Atty. Henry also prepared a Counter Deed of Sale and Occupancy Agreement signed by Pete in favor of George. A competitor of George filed a complaint for disbarment against Atty. Henry on the ground that he violated the Constitution and the CPR. Rule on the complaint and explain. (5%) -XII- Jaybee engaged the services of Atty. Pete to defend him in a criminal case for murder. During trial, when the defense was presenting its evidence, Jaybee admitted to Atty. Pete that he killed the victim in the case. Atty. Pete withdrew from the case. Jaybee sued Atty. Pete for disbarment alleging that the latter violated Canon 15 of the CPR that “a lawyer shall observe candor, fairness and loyalty in all his dealings and transactions with his client” and Canon 17 of the CPR that “a lawyer owes fidelity to the cause of his client and he shall be mindful ofthe trust and confidence reposed in him.” Rule on the case and explain. (5%) -XIII- Atty. Dennis is the head ofthe Provincial DILG Office in Sultan Kudarat. In view of the lack of lawyers and notaries public in the province and because of numerous requests that the DILG provide a notary public, Atty. Dennis was constrained to apply for a commission from the RTC, which was granted. He was able to notarize thousands ofdocuments and affidavits until Atty. Antonio, the only notary public in the province, charged Atty. Dennis with misconduct and violation ofthe CPR. Is the charge correct? Explain. (5%) -XIV- 37 Sonia, who is engaged in the lending business, extended to Atty. Roberto a loan of P500,000.00 with interest of P25,000.00 to be paid not later than May 20, 2016. To secure the loan, Atty. Roberto signed a promissory note and issued a postdated check. Before the due date, Atty. Roberto requested Sonia to defer the deposit of the check. When Atty. Roberto still failed to pay, Sonia deposited the check which was dishonored. Atty. Roberto ignored the notice of dishonor and refused to pay. (a] Did Atty. Roberto commit any violation of the CPR? Explain. (2.5%) (b] Can he be held civilly liable to Sonia in an administrative case for suspension or disbarment? Explain. (2.5%) -XV- Atty. Alex entered into an agreement for his legal services with Johnny where it is provided that the latter will pay him Pl00,000.00 as acceptance fee and P 100,000.00 upon submission o f the case for decision. The court granted Johnny moral damages, exemplary damages and attorney’s fees of Pl00,000.00. After execution of the judgment, Atty. Alex kept the Pl 00,000.00 as his attorney’s fees. Johnny sued Atty. Alex for violation of the CPR claiming that the attorney’s fees awarded by the court belongs to him. Decide the case with reasons. (5%) -XVI- Pedro was accused of the crime of murder before the RTC and was found guilty of homicide. His counsel, Atty. Nestor, told him that he will file an appeal before the Court of Appeals (CA) because he believes that the claim of self-defense of Pedro will be given merit by the appellate court and that he will be acquitted. Pedro explains that he is amenable to the penalty imposed upon him. Despite the opposition of the accused, Atty. Nestor went on with the appeal. The CA decided that the conviction should be for murder in view of a qualifying circumstance. A petition with the High Court proved futile. Pedro hires you to file a disbarment suit against Atty. Nestor. What canon or rule ofthe CPR will you use as ground for the suit? Explain. (5%) -XVII- Jojo, a resident of Cavite, agreed to purchase the lot owned by Tristan, a resident of Bulacan. Atty. Agaton, Jojo’s lawyer who is also a notary public, prepared the Deed of Sale and Jojo signed the document in Cavite. Atty. Agaton then went to Bulacan to get the signature of Tristan. Thereafter, Atty. Agaton went back to his office in Cavite where he notarized the Deed of Sale. Is the notarization legal and valid? Explain. (5%) -XVIII- City Prosecutor Phillip prosecuted the criminal case for the murder of the city mayor against the accused Reynaldo, the losing mayoralty candidate. There was no private prosecutor and Phillip personally handled the prosecution of the case from arraignment up to the presentation of the evidence for the accused. Before the trial, Alfonso approached Phillip and confessed that he is the killer of the city mayor and not Reynaldo. When the case was called for trial, Phillip manifested before the court that Alfonso approached him and admitted that he killed the mayor and asked the court for whatever proper action it may take. The counsel for the accused took advantage o f the presence o f Alfonso, who was placed on the witness stand and elicited testimonial evidence. The court eventually acquitted Reynaldo. The heirs of the city mayor filed a disbarment case against Phillip on the ground that it is his duty to see to it that the criminal is convicted and punished. They believe Reynaldo is the real killer and Alfonso was only a fall guy and that Reynaldo could not have been acquitted were it not for the disclosure of Phillip. Phillip argues that the City Prosecutor is not for the offended party or the heirs of the victim but it is his main duty that “justice be done.” Did Phillip commit any violation ofthe CPR? Explain. (5%) -XIX- 38 St. Ivan’s Hospital, Inc. (St. Ivan’s) and Allied Construction Co. (Allied) separately retained the legal services of Tomas and Benedicto Law Offices. St. Ivan’s engaged the services of Allied for the construction of a new building but failed to pay the contract price after the completion ofthe works. A complaint for sum of money was filed by Atty. Budoy, a former associate of Tomas and Benedicto Law Offices, on behalf of Allied against St. Ivan’s. St. Ivan’s lost the case and was held liable to Allied. Thereafter, St. Ivan’s filed a disbarment complaint against Atty. Budoy. It claimed that while Atty. Budoy has established his own law office, an arrangement was made whereby Tomas and Benedicto Law Offices assign cases for him to handle, and that it can be assumed that Tomas and Benedicto Law Offices collaborate with Atty. Budoy in the cases referred to him, creating a conflict of interest. Rule on the complaint with reasons. (5%). -XX- Atty. Gail was separated from her husband, Dino, for more than ten (10) years due to incompatibility. She fell in love with Mica who was also separated from her husband. She filed a petition for the declaration of nullity of her marriage with Dino, and also a petition for the declaration ofnullity ofthe marriage ofMica with her husband. While the cases were pending, Atty. Gail and Mica lived in their respective residences but were often seen together in parties, events and in public places. Dino filed a disbarment complaint against Atty. Gail for immorality, alleging that Atty. Gail and Mica are lovers. Decide whether Atty. Gail should be sanctioned for immorality. (5%) 39