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8

VIII.
(10%)
Due to growing financial difficulties, Z Bank was unable to finish construction of its 21-storey building on a prime lot located in Makati City. Inevitably, the Bangko Sentral ordered the closure of Z Bank and consequently placed it under receivership. In a bid to save the bank’s property investment, the President of Z Bank entered into a financing agreement with a group of investors for the completion of the construction of the 21-storey building in exchange for a ten-year lease and the exclusive option to purchase the building.

(a) Is the act of the President valid? Why or why not?

(b) Will a suit to enforce the exclusive right of the investors to purchase the property prosper? Reason briefly.

1 comment:

Anonymous said...

VIII.

a.

No. The president has no authority to enter into the financing agreement because the bank is already under receivership. It is the receiver who is authorized to take charge of all the assets and liabilities of the institution and administer the same.

b.

No. The financing agreement is unenforceable since the president had no authority to enter into said agreement.