How to Answer Law School Exams

1. If the facts are specific, do not qualify your answer. Answers must be responsive to the question.

2.Organize your paragraphs. I suggest you use the inverted pyramid structure which means that you must place the topic sentence (the most fundamental or relevant facts which answers the question) at the top. The non-essential or supporting information should then follow. Get to the point immediately, then follow through with your bases.

"It's also an extremely useful tool for thinking and organizing because it forces the reporter to sum up the point of the story in a single paragraph. Journalism students who master it and then go on to other fields say it comes in handy for writing everything from legal briefs to grant applications."
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CASE DIGEST (Transportation Law): Valenzuela Hardwood vs. CA

(GR 102316, 30 June 1997)
FACTS:
Valenzuela Hardwood and Industrial Supply, Inc. (VHIS) entered into an agreement with the Seven Brothers whereby the latter undertook to load on board its vessel M/V Seven Ambassador the former’s lauan round logs numbering 940 at the port of Maconacon, Isabela for shipment to Manila. VHIS insured the logs against loss and/or damage with South Sea Surety and Insurance Co.

The said vessel sank resulting in the loss of VHIS’ insured logs. VHIS demanded from South Sea Surety the payment of the proceeds of the policy but the latter denied liability under the policy for non-payment of premium. VHIS likewise filed a formal claim with Seven Brothers for the value of the lost logs but the latter denied the claim.

The RTC ruled in favor of the petitioner.Both Seven Brothers and South Sea Surety appealed. The Court of Appeals affirmed the judgment except as to the liability of Seven Brothers.South Sea Surety and VHIS filed separate petitions for review before the Supreme Court. In a Resolution dated 2 June 1995, the Supreme Court denied the petition of South Sea Surety. The present decision concerns itself to the petition for review filed by VHIS.

ISSUE:
Is a stipulation in a charter party that the “(o)wners shall not be responsible for loss, split, short-landing, breakages and any kind of damages to the cargo” valid?

HELD:
Yes. Xxx [I]t is undisputed that private respondent had acted as a private carrier in transporting petitioner’s lauan logs. Thus, Article 1745 and other Civil Code provisions on common carriers which were cited by petitioner may not be applied unless expressly stipulated by the parties in their charter party.

In a contract of private carriage, the parties may validly stipulate that responsibility for the cargo rests solely on the charterer, exempting the shipowner from liability for loss of or damage to the cargo caused even by the negligence of the ship captain. Pursuant to Article 1306 of the Civil Code, such stipulation is valid because it is freely entered into by the parties and the same is not contrary to law, morals, good customs, public order, or public policy. Indeed, their contract of private carriage is not even a contract of adhesion. We stress that in a contract of private carriage, the parties may freely stipulate their duties and obligations which perforce would be binding on them. Unlike in a contract involving a common carrier, private carriage does not involve the general public. Hence, the stringent provisions of the Civil Code on common carriers protecting the general public cannot justifiably be applied to a ship transporting commercial goods as a private carrier. Consequently, the public policy embodied therein is not contravened by stipulations in a charter party that lessen or remove the protection given by law in contracts involving common carriers.

x x x

The general public enters into a contract of transportation with common carriers without a hand or a voice in the preparation thereof. The riding public merely adheres to the contract; even if the public wants to, it cannot submit its own stipulations for the approval of the common carrier. Thus, the law on common carriers extends its protective mantle against one-sided stipulations inserted in tickets, invoices or other documents over which the riding public has no understanding or, worse, no choice. Compared to the general public, a charterer in a contract of private carriage is not similarly situated. It can -- and in fact it usually does -- enter into a free and voluntary agreement. In practice, the parties in a contract of private carriage can stipulate the carrier’s obligations and liabilities over the shipment which, in turn, determine the price or consideration of the charter. Thus, a charterer, in exchange for convenience and economy, may opt to set aside the protection of the law on common carriers. When the charterer decides to exercise this option, he takes a normal business risk.

CASE DIGEST (Transportation Law): TABACALERA vs. NORTH FRONT SHIPPING SERVICES

TABACALERA INSURANCE CO., PRUDENTIAL GUARANTEE & ASSURANCE, INC., and NEW ZEALAND INSURANCE CO., LTD. vs. NORTH FRONT SHIPPING SERVICES, INC., and COURT OF APPEALS


[G.R. No. 119197. May 16, 1997]

FACTS:
Petitioners are insurers of a shipment of sacks of corn grains consigned to Republic Flour Mills Corporation in Manila. The cargo was shipped by North Front Shipping Services, Inc. The consignee was advised of its arrival but the unloading was delayed for six days for unknown reason, and the merchandise was already moldy, rancid and deteriorating.

The moisture content and the wetting was due to contact with salt water but the mold growth was only incipient and not sufficient to make the corn grains toxic and unfit for consumption. In fact the mold growth could still be arrested by drying. However, Republic Flour rejected the entire cargo which therefore forced the petitioners to pay the former.

Now, as subrogees, they lodged a complaint for damages against respondents claiming that the loss was exclusively attributable to the fault and negligence of the carrier. The Marine Cargo Adjusters hired by the insurance companies conducted a survey and found cracks in the bodega of the barge and heavy concentration of molds on the tarpaulins and wooden boards. They did not notice any seals in the hatches. The tarpaulins were not brand new as there were patches on them, contrary to the claim of North Front Shipping Services, Inc., thus making it possible for water to seep in. They also discovered that the bulkhead of the barge was rusty.

The trial court dismissed the complaint and ruled that the contract entered into between North Front Shipping Services, Inc., and Republic Flour Mills Corporation was a charter-party agreement. As such, only ordinary diligence in the care of goods was required. On the other hand, the Court of Appeals ruled that as a common carrier required to observe a higher degree of diligence North Front 777 satisfactorily complied with all the requirements hence was issued a Permit to Sail after proper inspection.

ISSUE:
Whether or not a charter-party agreement between P and R requires extraordinary diligence.

HELD:
Yes. The charter-party agreement between North Front Shipping Services, Inc., and Republic Flour Mills Corporation did not in any way convert the common carrier into a private carrier.

x x x

North Front Shipping Services, Inc., is a corporation engaged in the business of transporting cargo and offers its services indiscriminately to the public. It is without doubt a common carrier. As such it is required to observe extraordinary diligence in its vigilance over the goods it transports. When goods placed in its care are lost or damaged, the carrier is presumed to have been at fault or to have acted negligently. North Front Shipping Services, Inc., therefore has the burden of proving that it observed extraordinary diligence in order to avoid responsibility for the lost cargo.

However, we cannot attribute the destruction, loss or deterioration of the cargo solely to the carrier. We find the consignee Republic Flour Mills Corporation guilty of contributory negligence. It was seasonably notified of the arrival of the barge but did not immediately start the unloading operations. No explanation was proffered by the consignee as to why there was a delay of six (6) days. Had the unloading been commenced immediately the loss could have been completely avoided or at least minimized. As testified to by the chemist who analyzed the corn samples, the mold growth was only at its incipient stage and could still be arrested by drying. The corn grains were not yet toxic or unfit for consumption.

CASE DIGEST (Credit Transactions): ACME vs. Court of Appeals

ACME SHOE, RUBBER & PLASTIC CORPORATION and CHUA PAC vs.HON. COURT OF APPEALS, BANK OF THE PHILIPPINES and REGIONAL SHERIFF OF CALOOCAN CITY

G.R. No. 103576 August 22, 1996

FACTS:
Petitioner Chua Pac, the president and general manager of co-petitioner Acme executed a chattel mortgage in favor of private respondent Producers Bank as a security for a loan of P3,000,000. A provision in the chattel mortgage agreement was to this effect:

"In case the MORTGAGOR executes subsequent promissory note or notes either as a renewal of the former note, as an extension thereof, or as a new loan, or is given any other kind of accommodations such as overdrafts, letters of credit, acceptances and bills of exchange, releases of import shipments on Trust Receipts, etc., this mortgage shall also stand as security for the payment of the said promissory note or notes and/or accommodations without the necessity of executing a new contract and this mortgage shall have the same force and effect as if the said promissory note or notes and/or accommodations were existing on the date thereof. This mortgage shall also stand as security for said obligations and any and all other obligations of the MORTGAGOR to the MORTGAGEE of whatever kind and nature, whether such obligations have been contracted before, during or after the constitution of this mortgage."

In due time, the loan of P3,000,000.00 was paid. Subsequently it obtained additional loan totalling P2,700,000.00 which was also duly paid.

Another loan was again extended (P1,000,000.00) covered by four promissory notes for P250,000.00 each, but went unsettled prompting the bank to apply for an extrajudicial foreclosure with the Sheriff.

ISSUE:
Would it be valid and effective to have a clause in a chattel mortgage that purports to likewise extend its coverage to obligations yet to be contracted or incurred?

HELD:
No. While a pledge, real estate mortgage, or antichresis may exceptionally secure after-incurred obligations so long as these future debts are accurately described, a chattel mortgage, however, can only cover obligations existing at the time the mortgage is constituted. Although a promise expressed in a chattel mortgage to include debts that are yet to be contracted can be a binding commitment that can be compelled upon, the security itself, however, does not come into existence or arise until after a chattel mortgage agreement covering the newly contracted debt is executed either by concluding a fresh chattel mortgage or by amending the old contract conformably with the form prescribed by the Chattel Mortgage Law. Refusal on the part of the borrower to execute the agreement so as to cover the after-incurred obligation can constitute an act of default on the part of the borrower of the financing agreement whereon the promise is written but, of course, the remedy of foreclosure can only cover the debts extant at the time of constitution and during the life of the chattel mortgage sought to be foreclosed.

CASE DIGEST (Commercial Law): Intengan vs. CA

Intengan vs. Court of Appeals
G.R. No. 128996. February 15, 2002

Facts:
On September 21, 1993, Citibank filed a complaint for violation of section 31 in relation to section 144 of the Corporation Code against two (2) of its officers, Dante L. Santos and Marilou Genuino. Attached to the complaint was an affidavit executed by private respondent Vic Lim, a vice-president of Citibank

As evidence, Lim annexed bank records purporting to establish the deception practiced by Santos and Genuino. Some of the documents pertained to the dollar deposits of petitioners Carmen Ll. Intengan, Rosario Ll. Neri, and Rita P. Brawner.

In turn, private respondent Joven Reyes, vice-president/business manager of the Global Consumer Banking Group of Citibank, admits to having authorized Lim to state the names of the clients involved and to attach the pertinent bank records, including those of petitioners’

Petitioners aver that respondents violated RA 1405.

Issue:
Whether or not Respondents are liable for violation of Secrecy of Bank Deposits Act, RA 1405.

Held:
No. The accounts in question are U.S. dollar deposits; consequently, the applicable law is not Republic Act No. 1405 but Republic Act (RA) No. 6426, known as the “Foreign Currency Deposit Act of the Philippines,” However, applying Act No. 3326, the offense prescribes in eight years, therefore, per available records, private respondents may no longer be haled before the courts for violation of Republic Act No. 6426.

CASE DIGEST (Commercial Law): Marquez vs. Disierto

G.R. No. 135882 June 27, 2001

FACTS: Respondent Ombudsman Desierto ordered petitioner Marquez to produce several bank documents for purposes of inspection in camera relative to various accounts maintained at Union Bank of the Philippines, Julia Vargas Branch, where petitioner is the branch manager.

The order is based on a pending investigation at the Office of the Ombudsman against Amado Lagdameo, et. al. for violation of R.A. No. 3019, Sec. 3 (e) and (g) relative to the Joint Venture Agreement between the Public Estates Authority and AMARI.

Petitioner wanted to be clarified first as to how she would comply with the orders without her breaking any law, particularly RA. No. 1405.

ISSUE:
Whether the order of the Ombudsman to have an in camera inspection of the questioned account is allowed as an exception to the law on secrecy of bank deposits (R.A. No.1405).

HELD: No.
We rule that before an in camera inspection may be allowed, there must be a pending case before a court of competent jurisdiction. Further, the account must be clearly identified, the inspection limited to the subject matter of the pending case before the court of competent jurisdiction. The bank personnel and the account holder must be notified to be present during the inspection, and such inspection may cover only the account identified in the pending case

CASE DIGEST (Commercial Law) Banco Filipino vs. Purisima

G.R. No. L-56429 May 28, 1988

FACTS:
Customs special agent Manuel Caturla is accused by the Bureau of Internal Revenue of having violated R.A. No. 3019 of the "Anti-Graft and Corrupt Practices Act" for having allegedly acquired property manifestly out of proportion to his salary and other lawful income. In the course of the preliminary investigation thereof, the Tanodbayan issued a subpoena duces tecum to the Banco Filipino Savings & Mortgage Bank, commanding its representative to appear at a specified time at the Office of the Tanodbayan and furnish the latter with duly certified copies of the records in all its branches and extension offices, of the loans, savings and time deposits and other banking transactions, dating back to 1969, appearing in the names of Caturla, his wife, Purita Caturla, their children — Manuel, Jr., Marilyn and Michael — and/or Pedro Escuyos.

Caturla moved to quash the subpoena duces tecum but was denied by Tanodbayan Vicente Ericta.Petitioner Banco Filipino filed a complaint for declaratory relief with the Court of First Instance of Manila but was denied for lack of merit by respondent Judge Purisima.

ISSUE:
Whether or not the RA 1405 "Law on Secrecy of Bank Deposits" precludes production by subpoena duces tecum of bank records of transactions by or in the names of the wife, children and friends of a special agent of the Bureau of Customs, accused before the Tanodbayan of having allegedly acquired property manifestly out of proportion to his salary and other lawful income, in violation of the "Anti-Graft and Corrupt Practices Act".

HELD:
No. The inquiry into illegally acquired property — or property NOT "legitimately acquired" — extends to cases where such property is concealed by being held by or recorded in the name of other persons. This proposition is made clear by R.A. No. 3019 which quite categorically states that the term, "legitimately acquired property of a public officer or employee shall not include .. property unlawfully acquired by the respondent, but its ownership is concealed by its being recorded in the name of, or held by, respondent's spouse, ascendants, descendants, relatives or any other persons."

To sustain the petitioner's theory, and restrict the inquiry only to property held by or in the name of the government official or employee, or his spouse and unmarried children is unwarranted in the light of the provisions of the statutes in question, and would make available to persons in government who illegally acquire property an easy and fool-proof means of evading investigation and prosecution; all they would have to do would be to simply place the property in the possession or name of persons other than their spouse and unmarried children. This is an absurdity that we will not ascribe to the lawmakers

CASE DIGEST (Commercial Law): CHINA BANKING CORP vs. Ortega

G.R. No. L-34964 January 31, 1973

Facts:
Petitioner refuses to comply with a court process garnishing the bank deposit of a judgment debtor by invoking the provisions of Republic Act No. 1405 (Secrecy of Bank Deposits Act) which allegedly prohibits the disclosure of any information relative to bank deposits.

Issue:
Whether or not a banking institution may validly refuse to comply with a court process garnishing the bank deposit of a judgment debtor, by invoking the provisions of Republic Act No. 1405.

Held:
No. It is sufficiently clear from the foregoing discussion of the conference committee report of the two houses of Congress that the prohibition against examination of or inquiry into a bank deposit under Republic Act 1405 does not preclude its being garnished to insure satisfaction of a judgment. Indeed there is no real inquiry in such a case, and if the existence of the deposit is disclosed the disclosure is purely incidental to the execution process. It is hard to conceive that it was ever within the intention of Congress to enable debtors to evade payment of their just debts, even if ordered by the Court, through the expedient of converting their assets into cash and depositing the same in a bank

CASE DIGEST (Commercial Law): PNB vs. Gancayco

G.R. No. L-18343 September 30, 1965

FACTS:
Defendants Emilio Gancayco and Florentino Flor, as special prosecutors of the Department of Justice, required the plaintiff Philippine National Bank to produce at a hearing the records of the bank deposits of Ernesto Jimenez, former administrator of the Agricultural Credit and Cooperative Administration, who was then under investigation for unexplained wealth. In declining to reveal its records, the plaintiff bank invoked Section 2 of Republic Act No. 1405.

On the other hand, the defendants cited Section 8 of the Anti-Graft and Corrupt Practices Act (Republic Act No. 3019) in support of their claim of authority,which allegedly provides an additional ground for the examination of bank deposits.

ISSUE:
Whether Section 8 of Republic Act No. 3019 provides an additional ground for the examination of bank deposits.

HELD:
Yes. The truth is that these laws are so repugnant to each other than no reconciliation is possible. x x x. The only conclusion possible is that section 8 of the Anti-Graft Law is intended to amend section 2 of Republic Act No. 1405 by providing additional exception to the rule against the disclosure of bank deposits.

x x x [W]hile section 2 of Republic Act 1405 declares bank deposits to be "absolutely confidential," it nevertheless allows such disclosure in the following instances:
(1) Upon written permission of the depositor;
(2) In cases of impeachment;
(3) Upon order of a competent court in cases of bribery or dereliction of duty of public officials;
(4) In cases where the money deposited is the subject matter of the litigation. Cases of unexplained wealth are similar to cases of bribery or dereliction of duty x x x.