1) Which one of the following element is not necessary for a contract ?
A) Competent parties
B) Reasonable terms and conditions.
C) Free consent
D) Lawful concentration .
Answer : B
2) An agreement becomes a contract if :
A) It is by free consent of the parties.
B) Parties are competent.
C) It is enforceable by law.
D) None of the above .
Answer : C
3) In a standardized contract :
A) The individual has no choice but to accept and sign on the dotted line.
B) The individual must be protected in contract.
C) The agreement is without consideration.
D) None of the above.
Answer : A
5) The correct sequence in the formation of a contract is :
A) Offer, acceptance, agreement, consideration.
B) Agreement, consideration, offer,acceptance.
C) Offer , Consideration, acceptance, agreement.
D) Offer,acceptance, consideration, agreement.
Answer :D
) Consider the following statements :
A) Every promise is an agreement.
B) Every agreement is a contract.
C) A contractor which cease to be enforceable by law becomes void .
D) A minor who is supplied necessaries is personally liable to pay for them.
Which of the statements given above are correct?
A) A and C only.
B) A and B only.
C) A, B and C .
D) B, C and D .
Answer :A
2) Consider the following statements :
1. If an infant obtains property or goods by misrepresenting his age, he can be compelled to restore it
even though the infant has sold the Goods or converted them.
2. There is no estoppel against minor.
Which of the statement given above are correct?
A) 1 only .
B) 2 only .
C) Both 1 and 2.
D) Neither 1 nor 2.
Answer : B
3) A petient in a lunatic Asylum who is at intervals of sound mind :
A) May not contract.
B) May contract.
C) May contact during those intervals when he is of sound mind.
D) May contract only after he becomes completely of sound mind .
Answer : C
4) A sells, by auction to B a horse which A knows to be unsound. A says nothing to B about the
horse unsoundness. A does :
A) Fraud
B) Misrepresentation
C) No fraud
D) Undue Influence
Answer : C
5) Where both parties are under mistake as to matter of fact, the agreement will be :
A) Enforceable
B) Voidable
C) Not void
D) Void
Answer : C
1) What will be the effect of mistakes as to law in force in India on the agreement?
A) Not voidable
B) Voidable
C) Void
D) Not void
Answer. : A
2) An agreement made without free consent is:
A) Always void
B) Voidable
C) Unlawful
D) Either void or voidable.
Answer. : B
3) Which of the following statement is not correct ?
A) Minor's agreement is void.
B) Wagering agreement is void
C) Agreement caused by mutual mistake is void.
D) Contract without consideration is void.
Answer. : C
4) A Guru. ( spiritual advisor) induced the Chela ( his devotee) to gift him a whole of his property
to secure benefit of his soul in the next World.
The gift shall be...
A) Void
B) Voidable
C) Valid
D) Immoral
Answer. :B
5) A contract caused by one of the parties to it being under a mistake as to matter of fact is :
A) Void
B) Valid
C) Voidable at the option of either party.
D) Voidable at the option of the party who under mistake.
Answer. : B
1) Which one of the following sections of the Indian Contract Act,1872 relates to the rule no
consent, no agreement ?
A) Section 13
B) Section 21
C) Section 20
D) Section 22
Answer : A
2) Which is not the correct statement ?
A) If consent is the result of coercion, the agreement is void.
B) If a party is minor, the agreement is void .
C) If the object of an agreement is unlawful, the agreement is void.
D) If the consideration of an agreement is unlawful, the agreement is void .
Answer. : A
3) Which section of The Indian Contract Act, 1872 provides that where both parties to an
agreement are under a mistake of fact, the agreement is void.
A) Section 13
B) Section 20
C) Section 21
D) Section 22.
Answer. : B
4) Which may render an agreement void ?
A) Coercion causing consent.
B) Undue influence causing consent.
C) Fraud causing consent.
D) Agreement in restraint of trade.
Answer. : D
5) Where both the parties to an agreement under a mistake of fact essential to the agreement,
the agreement is :
A) Voidable at the option of sufferer
B) Illegal
C) Void
D) Not enforceable in a court.
Answer. : C
1) Unlawful detaining or threatening to detain any property with the intention of causing any
person to enter into an agreement would amount to which one of the following ?
A) Duress
B) Undue. influence.
C) Coercion
D) Unlawful detaintion.
Answer. : C
2) A promise made without intention to perform is:
A) Misrepresentation.
B) Fraud
C) Undue influence
D) Coercion.
Answer. : B
3) Under which one of the following sections of The Indian Contract Act, for the purpose of
contract, the term sound mind has been defined :
A) Section 12
B) Section 10
C) Section 11
D) Section 13
Answer. : A
4) Which statement is not correct ?
A) Coercion renders a contract voidable
B) Undue influence renders a contract voidable.
C) fraud renders a contract voidable.
D) Mistakes of Indian law renders a contract voidable.
Answer: D
5) A and B makes a contract grounded on the erroneous belief that a particular Debt is barred by
the Indian law of limitation.
The contract is :
A) Void
B) Voidable
C) Not voidable .
D) All of the above
Answer : C
1) A being entitled to an estate for the life of B , agrees to sell it to C, B was dead at the time of
agreement, but both parties were ignorant of that fact. The agreement is :
A) Valid
B) Void
C) Voidable
D) Illegal
Answer : C
2) A intending to deceive B falsely represents that 500 mounds of Indigo are made annual at A's
factory and thereby induces B to buy the factory. The contract is :
A) Voidable at the option of B.
B) Voidable at the option of A.
C) Valid.
D) Void .
Answer : A
3) B, having discovered a vein of ore on the estate of A, adopts the means to conceal, and does
conceal the existence of the ore from A. Through A's ignorance B is entitled to buy the estate at
an under value . The contract :
A) Is voidable at the option of A.
B) Is voidable at the option of B.
C) Is valid
D) Is Void
Answer : A.
4) A agrees to buy from B a certain house. It turns out that the house was dead at the time of
bargain, through neither party was aware of the fact. The agreement :
A) Void
B) Valid
C) Voidable
D) Illegal
Answer : A
5) B says to A if you do not deny it .I shall assume that is sound'. A says nothing. Here A's
silence is equivalent to :
A) Fraud
B) misrepresentation
C) Coercion
D) Speech
Answer : D
The party who makes the offer to enter into a
contract is known as the
____________________.
the offeror
Your
Answer:
Correct
2. Which of the following would NOT
be considered a defense to the
enforcement of a contract?
consent
Your Answer: obtained
through the
use of fraud
Correct Answer: genuine
consent
This is a defense to the
enforcement of a contract.
3. Which of the following is NOT an
element in the formation of a
contract?
bargained-for
Your Answer: consideration
Correct Answer: The object of
a contract
may be
unlawful.
The promise must be supported
by a bargained-for consideration
that is legally sufficient.
4. The major source of contract law
in the United States is the
Napoleonic
Your Answer: law.
Correct Answer: common law
of contracts.
common law of contracts
(Napoleonic law is a factor, but
not a major source)
5. UCC stands for the
Uniform
Your Answer: Commerce
Center.
Correct Answer: Uniform
Commercial
Code.
Uniform Commercial Code.
6. Which of the following best
describes the objective theory of
contracts?
The objective
Your Answer: theory refers
to an offeror's
promise
which is
answered
with the
offeree's
promise of
acceptance.
Correct Answer: It refers to
the intent to
enter into an
express or
implied
contract as
judged by the
reasonable
person
standard.
This refers to a bilateral contract.
7. What type of contract is an
agreement between the parties in
which an agreement has been
inferred?
bilateral
Your Answer: contract
Correct Answer: implied-in-
fact
implied-in-fact
8. Which of the following is an
example of a formal contract?
a contract
Your Answer: written on a
paper napkin
Correct Answer: a check
This is an informal contract.
9. A voidable contract is one in
which
has no legal
Your Answer: effect.
Correct Answer: one in which
at least one
party has the
option to
avoid his or
her
contractual
obligations.
10. All of the following are sources of
contract law in the United States
EXCEPT for
Common
Your Answer: Law.
Correct Answer: International
Equity Law.
This is a source of contract law.
11. The Restatement (Second) of
Contracts identifies all the
following as types of formal
contracts, EXCEPT
oral contracts.
Your Answer:
Correct
12. A contract in which there is some
legal defense to its enforcement
is called a/n _______________
contract.
voidable
Your Answer:
Correct Answer: unenforceable
unenforceable (a voidable
contract is one in which one party
has the option of voiding)
13. A contract that has not been
performed by both sides is called
voidable.
Your Answer:
Correct Answer: executory.
A voidable contract is one where
at least one party has the option
to avoid his or her contractual
obligations.
Jimmy Jeanz is a famous brand of jeans. It has a contract to supply a retailer, House of Jeans,
with stock of its jeans. In a sale of goods contract of this type, the jeans must be of
satisfactory quality (SGA 1979, s. 14(2)). Which one of the following statements is
a correct application of this provision?
Correct answer:
d) If all the zippers in a batch of 100 jeans are broken, House of Jeans is entitled to return all
these jeans and claim a full refund.
Question 2
Where a statement made by one party before the conclusion of the contract is found to be
untrue, the innocent party's remedies may vary according to whether the statement is
characterized as a term or a representation. If the statement is characterized as a term,
which one of the following assertions relating to the innocent party's remedies is true?
Correct answer:
c) The innocent party is generally entitled to damages for expectation losses.
Question 3
Which of the following approaches might be applied by the courts post Marks & Spencer
plc v BNP Paribas Securities Services Trust Co. (Jersey) Ltd [2015] UKSC 72, [2016]
AC 742 in connection with the implication of a term in fact into a contract? [Please
select all that apply.]
You did not select all the right answers. Correct answer/s:
a) A term can be implied if the parties would have definitely agreed upon it had they been
asked about it by an officious bystander at the time of contracting.
b) It will often be appropriate for a court to first construe the express words of a contract
before considering whether a term should be implied.
d) An appropriate question to ask is whether the implication of a term would give "business
efficacy" to the contract.
Question 4
A, the owner of a large chain of off-licences, wishes to purchase 100,000 bottles of Liebzig
white wine from B, a wine wholesaler. A states his particular wish to purchase wine of a
2007 vintage because this appears to offer the best mix of quality and value. In B's opinion,
the wine is of the correct vintage but, as there are no labels on the bottles, he advises A to
verify this fact independently. A purchases the wine but subsequently discovers that the wine
was produced in 2009, an inferior vintage. A and B cannot agree whether the vintage of the
wine was a term of the contract. Which one of the following
statements probably summarises the legal position between the parties?
Correct answer:
b) Because B tells A to verify the vintage independently, it is clear that there is no intention
that the vintage would be a term of the contract.
Question 5
The distinction between strict and qualified contractual obligations is that the former is an
obligation to achieve a guaranteed result, while the latter is an obligation to exercise
reasonable care and skill.
Your answer:
a) True
Question 6
A breach of contract occurs when the time for performing a duty under the contract arrives
and that duty is not performed. Which one of the following statements correctly describes the
legal consequence of a breach of contract?
Your answer:
a) Every breach of contract makes the contract-breaker liable to pay damages to the non-
breaching party.
Question 7
Which one of the following statements most accurately describes the legal effects of a
repudiatory breach by one of the parties to the contract?
Your answer:
a) The breach will not affect the subsistence of any exemption or arbitration clauses in the
contract.
Question 8
Which one of the following statements most accurately summarises the decision in L
Schuler A-G v Wickman Machine Tools Sales Ltd [1974] AC 235?
Correct answer:
c) A term may not be recognised as a condition if the parties could not have contemplated it
as having the effect of a condition, even if the parties expressly use the word 'condition' to
describe the term.
Question 9
On 1 June, A contracts to sell a quantity of goods to B to be delivered by 1 July. On 15 June,
as A is still making arrangements for the shipment of the goods, he receives a fax message
from B stating that the goods are no longer wanted. Which one of the following statements
concerning A's rights is true?
Correct answer:
c) A is entitled to terminate the contract and claim damages immediately.
Question 10
A Ltd enters a contract with B Ltd, under which B Ltd is to develop a software product
specifically tailored for A Ltd for a fixed price. Before B Ltd starts the development or incurs
any expense under the contract, A Ltd cancels the contract, alleging a fundamental change of
its business strategy. B Ltd ignores A Ltd's cancellation and continues to complete the
development of the software. Supposing the performance of the contract will not enhance B
Ltd's reputation, which of the following statements most accurately summarise the legal
position between the parties? [Please select all that apply.]
Correct answer/s:
b) B Ltd is bound to terminate the contract following A Ltd's anticipatory breach because B
Ltd has no legitimate interest in affirming the contract and continuing its performance.
c) B Ltd is not entitled to the contract price because it cannot complete its performance of the
contract without the cooperation of A Ltd.
