Special Commercial Laws Complete and Updated Course Syllabus I. Letters of Credit
A. Definition/concept Definition/concept B. Governing laws C. Nature of letter of credit D. Parties to a letter of credit 1. Rights and obligations of parties E. Basic principles of letter of credit 1. Doctrine of independence 2. Fraud exception principle 3. Doctrine of strict compliance Cases: 1. Metropolitan Waterworks and Sewerage System v. H on. Reynaldo B. Daway and Maynilad Water Services, Inc., G.R. No. 160732, June 21, 2004 2. Mico Metals Corp. v. Court of Appeals and Philippine Bank of Communications, G.R. No. 117914, Feb. 1, 2002 3. Transfield Philippines, Inc. v. Luzon Hydro Corporation, Australia and New Zealand Banking Group Limited and Security Bank Corporation, G.R. NO. 146717, Nov. 22, 2004
II. Warehouse Receipts Law (Act No. 2137)
A. Nature and functions of a warehouse receipt
Definition and nature of Warehouse Receipts Purpose of the Law Who may issue Warehouse Receipts Form and content of Warehouse Receipts Effect of omission of any of the essential terms Terms that cannot be included 1. To whom delivered
2. Kinds 3. Distinctions between a negotiable instrument and a negotiable warehouse receipt 4. Rights of a holder of a negotiable warehouse receipt as against a transferee of a nonnegotiable warehouse receipt B. Duties of a warehouseman
Who is a warehouseman Principal obligations of a warehouseman Lawful excuses to deliver goods In case of misdelivery Altered receipts Liability of warehouseman C. Warehouseman’s lien
Extent Loss and waiver of lien Enforcement Other topics: D. Negotiation and transfer of receipts E. Criminal offenses
III. Trust Receipts Law (Pres. Decree No. 115)
Purpose of the Law Trust Receipts, Definition Trust Receipt Transaction, Definition Parties to a Trust Receipt Importance of Trust Receipts Difference of Trust Receipts and Letters Of Credit A. Definition/concept of a trust receipt transaction 1. Loan/security feature 2. Ownership of the goods, documents and instruments under a trust receipt B. Rights of the entruster 1. Validity of the security interest as against the creditors of the entrustee/innocent purchasers for value C. Obligations and liability of the entrustee
1. Payment/delivery of proceeds of sale or disposition of goods, documents or instruments 2. Return of goods, documents or instruments in case of sale 3. Liability for loss of goods, documents or instruments 4. Penal sanction if offender is a corporation D. Remedies available Cases: 1. Development Bank of the Philippines v. Prudential Bank, G.R. No. 143772, Nov. 22, 2005 2. Landl & Company (Phil.) Inc., et al v. Metropolitan Bank, G.R. No. 159622, July 30, 2004 3. Anthony L. Ng v. People of the Philippines, G.R. NO. 173905, April 23, 2010
IV. The Chattel Mortgage Law (Act 1508 in rel. to Arts. 1484, 1485, 2140 and 2141 of the Civil Code)
Preliminaries: Definition of Chattel Mortgage Characteristics Distinguished for Pledge
A. Essential requisites B. Formal requisites C. Registration, when and where E. After-acquired property F. After-incurred obligation G. Right of junior mortgagee H. Foreclosure procedure I. Redemption J. Claim for deficiency 1. General rule 2. Exception 3. Article 1484 Cases: 1. Union Bank v. Juniat, et al., G. R. No. 171569, August 1, 2011
2. Acme Shoe Rubber & Plastic Corp and Chua Pac v. Hon. Court of Appeals, Producers Bank of the Philippines and Regional Sheriff of Caloocan City, G.R. No. 103576, August 22, 1996 3. Servicewide Specialists, Inc. v. Court of Appeals, Hilda Tee, and Alberto Villarica, G.R. No. 11408, November 19, 1999
V. Real Estate Mortgage Law (Act 3135, as amended by R.A. 4118)
Preliminaries: Arts. 2124-2131 Civil Code Definition of Real Estate Mortgage Characteristics of REM Essential Requisites Registration Requirement A. Coverage B. Remedies available to mortgagee upon default of the mortgagor C. Need for special power of attorney D. Authority to foreclose extrajudicially E. Procedure 1) Where to file 2) Where to sell 3) Posting requirement 4) Publication requirement a. Sufficiency of newspaper publication b. Need for republication in case of postponement c. Personal notice to the mortgagor when and when not needed F. Possession by purchaser of foreclosed property G. Remedy of debtor if foreclosure is not proper H. Redemption a. Who may redeem b. Amount of redemption price c. Period for redemption d. Effect of pendency of action for annulment of sale I. Writ of possession a. Ministerial duty of the court b. Enforcement against third parties
c. Pendency of action for annulment of sale J. Annulment of sale Cases: 1. 2. 3. 4. 5.
Fortune Motors Phils. v. Metropolitan Bank and Trust Company, G.R. No. 115068, November 28, 1996 GC Dalton Industries Inc. v. Equitable PCI Bank, G.R. No. 171169, August 24, 2009 Development Bank of the Philippines v. Environmental Aquatics Inc., G.R. No. 174329, October 20, 2010 Sps. Victor and Grace Ong v. Court of Appeals, G.R. No. 121494, June 8, 2000 Sps. Basilio and Norma Hilaga v. Rural Bank of Isulan, G.R. No. 179781, April 7, 2010
VI. Truth in Lending Act (R.A. 3765)
Preliminaries: Rep. Act No. 3765 Central Bank Circular No. 158 (Oct. 29, 1963) A. Purpose B. Obligation of creditors to person to whom credit is extended C. Covered and excluded transactions D. Consequences of non-compliance with obligation
Cases: 1. Development Bank of the Philippines v. Felipe Arcilla, G.R. No. 161397, 161426, June 30, 2005 2. United Coconut Planters Bank v. Sps. Beluso, G.R. No. 159912, August 17, 2007
VII. Anti-money Laundering Law (R.A. 9160, as amended by R.A. 9194)
A. Policy of the law B. Covered institutions C. Obligations of covered institutions D. Covered transactions E. Suspicious transactions F. When is money laundering committed
G. Unlawful activities or predicate crimes H. Anti-money laundering council I. Functions J. Freezing of monetary instrument or property K. Authority to inquire into bank deposits
Cases: 1. Republic of the Philippines v. Hon. Antonio Eugenio, Jr., G.R. No. 174629, February 14, 2008 2. Republic of the Philippines v. Glasgow Credit and Collection Services Inc., G.R. No. 170281, January 18, 2008
VIII. Foreign Investments Act (R.A. 7042)
A. Policy of the law B. Definition of terms a) Foreign investment b) “Doing business” in the Philippines c) Export enterprise d) Domestic market enterprise C. Registration of investments of non-Philippine nationals D. Foreign investments in export enterprises E. Foreign investments in domestic m arket enterprises F. Foreign investment negative list
Cases: 1. Alfred Hahn v. Court of Appeals, G.R. No. 1137 04, January 22, 1997 2. Cargrill Inc. v. Intra Strata Assurance Corp., G.R. No. 168266, March 15, 2010 3. Agiagilent Technologies Singapore v. Integrated Silicon Technology, G.R. No. 1 54618, April 14, 2004 IX. Securities Regulations Code (R.A. 8799)
A. State policy (purpose) Case:
1. Abacus Securities Corp. v. Ruben U. Ampil, G.R. NO. 160016, February 27, 2006 B. Powers and functions of the SEC 1. Regulatory 2. Adjudicative Case: 1. CEMCO Holdings, Inc. v. National Life Insurance Company of the Philippines, Inc., G.R. No. 171815, August 7, 2005 C. Securities required to be registered 1. Exempt securities 2. Exempt transactions Case: 1. Securities and Exchange Commission v. Prosperity.com, G.R. No. 164197, January 25, 2012 2. Power Homes Unlimited Corp. v. Securities and Exchange Commission, G.R. No. 164182, February 26, 2008 D. Procedure for registration of securities E. Prohibitions on fraud, manipulation and insider trading 1. 2. 3. 4.
Manipulation of security prices Short sales Fraudulent transactions Insider trading
F. Protection of investors 1. Tender offer rule 2. Rules on proxy solicitation 3. Disclosure rule G. Civil liability
X. Electronic Commerce Act (R.A. 8792)
A. State policy B. Coverage 1. Electronic Data Message
2. Electronic Signature 3. Electronic Document 4. Electronic Key C. Legal Recognition D. Admissibility and Evidential Weight E. Electronic Contracts 1. Actions Related to Contracts of Carriage of Goods
