Indian Contract Act-Chapter 1B - Practice Problems

FINPREP Practice Questions Chapter Name Indian Contract Act Chapter No.
1B
FINPREP
A CPT preparatory program from
Practice Questions Subject: Mercantile Law
For Private Circulation to registered students.
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FINPREP Practice Questions Chapter Name Indian Contract Act Chapter No. 1B
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Performance of Contract
Q. 1
A Contract can be discharged by performance in which of the following ways? A. Offer to Perform i.e. Tender B. Actual performance C. (a) or (b) D. (a) and (b)
Q. 2
A contract stands discharged A. by performance of the contract B. by breach of the contract C. by agreement and novation D. by all of these
Q. 3
On the valid performance of the contractual obligation by the parties, the contract A. is discharged B. becomes enforceable C. becomes void D. None of these
Q. 4
A contract stands discharged by A. Performance of the contract B. Frustration of the contract C. both (a) & (b) D. Neither (a) nor (b)
Q. 5
If a Promisee accepts performance from a third person, he A. Can sue the third person for performing the contract B. Can also claim performance from the Promisor C. Should apologise to the Promisor D. Cannot afterwards enforce the promise against the Promisor
Q. 6
An agency can be created by the following ways: A. Agency by actual authority. B. Agency by ratification. C. Agency by ostensible authority. D. All of the above
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Q. 7 The rights of an agent against the principal are the following.............. A. Right of indemnification B. Right to compensation C. Right of stoppage in transit D. All of the above
Q. 8
X promises to deliver 10 T.V. sets to Y. In case of X's death before performance, X's representatives A. Shall be bound to deliver the T.V. to Y B. Shall be bound to deliver the T.V. to Y but their liability is limited to the value of the property inherited from the deceased C. Are not bound by the promise D. Shall terminate the contract
Q. 9
A Promisee can accept the performance from. A. Promisor himself B. Representative of the Promisor competent to perform C. A third person D. Any of the above
Q. 10
A contract between A, B and C was executed whereby A pays money to B for delivering some goods to C. C has not paid any consideration. Can C enforce the agreement? A. Yes, as he is the beneficiary of Trust B. Yes but the same can only be done jointly with A C. No as C did not pay the consideration D. A and only A can enforce the agreement
Q. 11
An agent may retain, out of sums received on account of the principal in the business of agency: A. Remuneration as may be payable B. Expenses properly incurred C. All sums due to himself D. All of the above
Q. 12
Which of the following persons can perform the contract A. Promisor alone B. Legal representatives of promisor C. Agent of the promisor D. All of these
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Q. 13 The following contractual rights cannot be assigned: A. Under a contract not involving personal skill B. An actionable claim C. Upon death of a party-upon his heirs and legal representatives D. Contracts involving personal skill
Q. 14
An agency coupled with interest does not come to an end in case of A. Death of the principal B. Insanity of the principal C. Insolvency of the principal D. Death or Insanity or Insolvency of the principal
Q. 15
A person employed to do any act for another or to represent another in dealings with the third parties is A. Principal B. Agent C. Servant D. Bailee
Q. 16
A directs B who is a solicitor to sell his estate by auction and to employ an auctioneer for this purpose. B names C, an auctioneer, to conduct the sale. The status of C for the sale is A. C is an agent of A B. C is a sub-agent of A C. C is an agent of B D. C is neither an agent of A nor or B
Q. 17
The relationship of principal and agent may arise by A. Express or implied agreement B. Ratification C. Operation of law D. All of the above
Q. 18
_________ can perform the contract A. Promisor alone B. Legal representative of promisor C. Agent of the promisor D. All of these
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Q. 19 A promisor can perform the promise A. Through his representatives irrespective of the competency of that representative B. Through his representative component to perform C. Himself D. None of the above
Q. 2o
Where price of goods sold is to be fixed by a third party refuses to fix the price, the contract becomes A. Void B. Voidable C. Illegal D. Void and Illegal
Q. 21
A contract can be performed by A. An agent of the promisor B. The promisor himself C. (a) or (b) D. Both (a) and (b)
Q. 22
When both the benefits and burden devolve on the legal heir, it would be called A. Will B. Assignment C. Delegation D. Succession
Q. 23
X, Y and Z jointly promise to give Rs.10, 000 Mr. A. Mr. A can enforce the contract A. Jointly B. Severally C. Specifically D. Both Jointly and severally
Q. 24
A, B and C jointly promised to pay Rs.60, 000 to D. Before performance of the contract, C dies. Here, the contract A. Becomes void on Cs death B. Should be performed by A and B along with Cs C. Should be performed by A and B alone D. Should be renewed between A, B and D
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Q. 25 If two or more persons have made a joint promise, then, unless a contrary intention appears from the contract, the promise shall be performed fulfilled, after the death of any of them by. A. The surviving Promisor(s) B. The Representative of the deceased Promisors C. (a) or (b) D. (a) and (b) X, Y and Z jointly promise to pay Rs.3, 000 to A. In the absence of express agreement to the contrary A can bring an action against A. any two of them only B. all of them together C. any one of them, at this choice D. the oldest amongst them In case of joint promises, the performance must be generally by A. One not authorized to perform B. Any one of them individually C. All the promisors jointly D. None of the above X, Y and Z jointly promise to pay Mr. A Rs.10, 000 Mr. A may compel A. X, Y and Z jointly and separately to pay Rs.10, 000 B. X to pay him Rs.10, 000 C. X, Y and Z jointly to pay him Rs.10, 000 D. X or Y or Z to pay him Rs.10, 000
Q. 26
Q. 27
Q. 28
Q. 29
Ram, Rohit and Kiran jointly borrowed Rs. 2,00,000/- from Rahim by executing a promissory note, Rohit and Kiran are not traceable. Rahim wants to recover the entire amount from Ram, Ram objected this move by saying he is liable to pay 1/3 of the debt only. Which of the following statement(s) is correct ? A. Rahim can recover the entire amount from Ram B. Rahim can only recover 1/3 of Rs. 2,00,000/- from Ram C. Rahim cannot recover any amount from Ram D. The promissory note is not executable against Ram as Rohit and Kiran are not traceable In case of joint promise, a promise can compel A. All the joint promisors to perform B. Any one of them to perform C. Some of them to perform D. Any of the above Page 7 of 31
Q. 30
Q. 31 The right of joint promisees to demand performance is A. Joint B. Several C. Joint or several D. Joint and several
Q. 32
What is reasonable time for performance of a contract? A. is a mixed question of fact and law B. is a question of fact C. is a question of law D. All of the above
Q. 33
Reasonable time for a performance of a contract is a A. Question of fact B. Question of prudence C. Question of law D. Mixed question of fact and law
Q. 34
X contracts to repair Y's car Y does not show him the car that require repair. In such case A. X must request Y to show the car B. X is excused for non-performance where it is so caused by Y's neglect C. Y can sue X for non-performance D. X can sue Y for non-co-operation.
Q. 35
Where the performance of a promise by one party depends on the prior performance of promise by the other party, such reciprocal promises fall under the category of A. Mutual and concurrent B. Conditional and dependent C. Mutual and independent D. Can't be determined
Q. 36
When a contract expressly provides for the order of performance of reciprocal promises, the promises shall be performed in _______ A. Any reasonable order B. Any appropriate order C. Any order D. The order mentioned and not otherwise
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Q. 37 Suppose the time fixed for performance of the contract has expired but the time is not essential. What is the remedy of the promisee in the circumstances? A. Can rescind the contract B. To claim compensation C. No remedy available D. Cant be determined
Q. 38
Time may be made the essence of a contract by subsequent notice also. Statement is A. True B. Partly True C. False D. Partly False
Q. 39
Any stipulation other than time of payment is of the essence of the contract depends upon A. Stipulation as to time given under Sec. 11 of the Indian Contract Act, 1872 B. Operation of law C. Terms of the contract D. All of the above
Q. 40
A contract is discharged by supervening impossibility: A. When change of law takes place subsequent to the contract B. On the death of the party who has to perform the contract personally C. Non-existence of particular state of things D. All of the above
Q. 41
When performance of promise becomes impossible or illegal by occurrence of an unexpected event or change of circumstances beyond the contemplation of parties, the contract becomes void. The situation is dealing with A. Remission B. Recession C. Supervening Impossibility D. Alteration
Q. 42
In which of the following cases, a contract is not discharged on the ground of subsequent impossibility? A. Destruction of subject matter B. Death of the promisor C. Commercial hardships D. Change of law Page 9 of 31
Q. 43 A owes Rs.100 to B. He promises to pay Rs.20 to C, the servant of B, who in turn promises to discharge A from the debt. A. This is legally impossible B. A can be recover the balance of Rs.80 from C C. A can be recover the balance of Rs.80 from B D. B can recover the balance of Rs.80 from A
Q. 44
A contract is not discharged on the ground of supervening impossibility: A. On difficulty performance B. Strikes, lock outs and civil disturbances C. Outbreak of war D. (A) and (B) above
Q. 45
When after the formation of a valid contract, an event happens which makes the performance of contract impossible, and then the contract becomes A. Void B. Voidable C. Valid D. Illegal
Q. 46
Where the debtor does not intimate about appropriation, the creditor may apply the payment: A. To a disputed debt B. To an unlawful debt C. To a debt barred by Law of Limitation D. To the payment of interest
Q. 47
X owes Y totally Rs.50, 000. He sends a cheque for Rs.20, 000 stating that it shall be appropriated towards he first sum of Rs.20,000 he took from Y. Y shall appropriate it towards A. That debt as indicated by B. Any debt due from X C. Any disputed debt due from X D. Any time barred debt due from X
Q. 48
Which of the following statements are true? A. At the time of payment, the debtor has the right of appropriating the payment B. In default of debtor, the creditor has the option of election C. In default of either, the law will allow appropriation of debts in order of time D. All of the above Page 10 of 31
Q. 49
Rule in Claytons case is: Unless there is a contrary intention, the items on the credit of an account must be appropriated A. Against the items on debit in order of date B. In any order as the creditor wants C. As per the directions of the court D. None of the above
Q. 50
A contract is discharged by novation which means the A. Cancellation of the existing contract B. Change in one or more terms of the contract C. Substitution of existing contract for a new D. None of these
Q. 51
A contract in discharged by rescission when: A. Some of the terms of the contract are cancelled B. When a new contract is entered into C. When there is difficulty of performance D. All of the above
Q. 52
When one or more of the terms of the contract is/are altered by mutual consent of the parties, it A. Alteration B. Rescission C. Novation D. Merger
Q. 53
A person having possession of goods under voidable contract can sell the goods before theof the contract by the aggrieved party A. Confirmation B. Execution C. rescission D. ratification
Q. 54
When a new contract is substituted for an existing one between the same parties, it is: A. Alteration B. Novation C. Amendment D. Rescission Page 11 of 31
Q. 55 means Termination of Contract. A. Rescission B. Injunction C. Specific Performance D. Quantum Meruit
Q. 56
Recession means.......................... A. Substituting a new contract for the old one B. Cancellation of the old contract C. Modifying or altering the terms of contract such that it has the effect of substituting a new contract for the old one D. Dispensing away the performance of the promise made by the other party
Q. 57
Restitution means: A. Return of the benefit received from the plaintiff under a void contract B. Restoring the contract C. Making alterations in the terms of the contract D. Revoking the contract
Q. 58
Contracting parties may not remain same in...... A. Remission B. Recession C. Novation D. Alteration
Q. 59
A contract need not be performed: A. When its performance becomes impossible B. When it is altered/rescinded/substituted for a new one C. When the promisee disperses with it D. All of the above
Q. 60
Which of the following is correct A. Recession must be communicated to the other party in the same manner as a proposal is communicated B. Recession must be revoked in the same manner as a proposal is communicated C. Communication of recession is optional D. Both (a) & (b)
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Q. 61 Contract can be discharged by agreement between parties by the way A. Remission B. Waiver C. (a) or (b) D. (a) and (b)
Q. 62
When any partly makes any material alteration to the terms of contract, without the consent of the other party, the contract is A. Valid B. Void C. Voidable D. Discharged
Q. 63
A change of nature of obligation of a Contract known as A. Alteration B. repudiation C. Novation D. rescission
Q. 64
A contract is discharged by novation which means the A. Cancellation of the existing contract B. Change in one or more terms of the contract C. Substitution of existing contract for a new one D. None of these
Q. 65
Novation means A. Substituting a new contract for the old one B. Cancellation of the old contract C. Modifying or altering the terms of contract such that it has the effect of substituting a new contract for the old one. D. Dispensing away the performance of the promise made by the other party
Q. 66
Total substitution of new contract in place of the old contract takes place in case of A. Remission B. Recession C. Novation D. Alteration
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Q. 67 Where the parties to the contract mutually agree to cancel the contract, it is called A. Remission B. Recession C. Novation D. Alteration
Q. 68
A contract is discharged by alteration which means the A. Acceptance of loser performance B. Cancellation of the existing contract C. Change in one or more terms of contract D. abandonment of rights by a party
Q. 69
Which of the example is the case of contracts need not be performed A. a party substitutes a new contract for the old B. when the parties to a contract agree to rescind it C. when the parties to a contract agree to alter it D. All of these
Q. 70
Novation may take place between A. Different parties B. The same parties C. (a) or (b) D. (a) and (b)
Q. 71
On substitution of a new contract, the old contract is discharged is known as A. Rescission B. Novation C. Alteration of Contract D. Waiver
Q. 72
__________ means termination of contract A. Rescission B. Injunction C. Specific performance D. Quantum meriut
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Q. 73 In case of __________ the term of contract may be altered by mutual consent, but the parties to the contract will remain the same. A. Novation B. Remission C. Rescission D. Alteration
Q. 74
Specific Performance may be ordered by the Court when the A. damages are an adequate remedy B. defaulting party is not ready to pay damages C. damages are not an adequate remedy D. the contract is voidable
Q. 75
A contract may be discharged by: A. Performance B. Impossibility C. Operation of the law D. All of the above
Q. 76
X promises to drop prosecution which he has instituted against R for robbery and R promises to restore the value of things taken. A. X can enforce this promise because they have mutually agreed. B. No, X cant enforce because it would defeat the very provisions of lapse. C. No, it cannot be enforced because both parties cause to the original position D. Yes, X can enforce the promise to over bake to the original position
Q. 77
Ans.
Discharge by mutual agreement may involve A. Novation B. Rescission C. Alteration D. All of the above D. All of the above
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Q. 78 A contract can be discharged by operation of law by A. Death of promisor B. By insolvency of promisor C. By Lunacy of promisor D. By death or insolvency of promisor
Q. 79
Where a certain amount is deposited as securing for performance of a contract, it is called A. Earnest money B. Cash money C. Hard money D. All of these
Q. 80
Assignment of contract may be by A. Operation lf law B. The act of parties C. (a) or (b) D. None of the above
Q. 81
___________ signifies that the parties are not further bound under the contract A. Discharge of a contract B. Breach of a contract C. Waiver of a contract D. Recession of a contract
Q. 82
A contract to perform a promise could arise by A. Standard form of contracts by promise B. Agreement and contract C. Promissory Estoppel D. All of the above
Q. 83
A contract can be discharged ___________ A. By mutual agreement B. By impossibility of performance C. By breach of contract D. By all the above
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Q. 84 _________ signifies that the parties are not further bound under the contract A. Discharge of contract B. Breach of contract C. Waiver of contract D. Recession of a contract
Q. 85
Specific performance may be ordered by court if A. there is no standard to ascertain actual damage B. Pecuniary compensation is not adequate relief C. The act is done wholly on part of trust D. (a) or (b) or (c)
Q. 86
Discharge of contracts by implied consent does not include A. Novation B. Actual performance C. Merger D. Waiver
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FINPREP Practice Questions Chapter Name Indian Contract Act Chapter No. 1B Breach of Contract
Q. 1 X purchased a hot water bag from a Chemist. The bag leaked and injured his wife. The Chemist is liable on account of A. Breach of express condition as to quality B. Breach of implied condition as to quality C. Personal injury caused to the Buyer's wife D. Hot water bottle sales are illegal Anticipatory Breach may be A. express B. Implied C. (a) or (b) D. (a) and (b) both H employed on a highly skilled work with access to the manufacturing data. In his spare time A worked for B on a similar work in competition with H. A. A could be restrained from working for B, as he was in breach of his duty B. A could work both for H and B C. B will not carry on similar work D. A would pay some share to H which he receives from B for similar work Non fulfilment of an obligation which one is bound to do under a contract is called A. Avoidance of a contract B. Breach of contract C. Voidability of contract D. Rescission of contract signifies that the parties are not further bound under the contract A. Discharge of a Contract B. Breach of a Contract C. Waiver of a Contract D. Rescission of a Contract Pepsi (cold drink) was supplied by A to B in bottles. B was injured by the bursting of one of the bottles. Can B claim damages from A? A. B can claim damages from A for injury B. B cannot claim damages from A for the injury C. B can get new bottle from A D. None of the above Page 18 of 31
Q. 2
Q. 3
Q. 4
Q. 5
Q. 6
Q. 7
Which of the following is correct A. Free consent is not important, if consideration is present, even if the consideration is inadequate B. Anticipatory breach and anticipatory bail are actually the same thing C. The concept of damage allows one to make some gain of it D. All of the above are incorrect
Q. 8
In case of breach of contract of sale A. buyer can always sue for interest on the amount of price paid in advance B. nobody can sue for interest C. seller can always sue for interest on the amount of price D. seller can sue for interest on the amount of price or buyer for interest on the amount of price paid in advance, as the case may be
Q. 9
Under a anticipatory breach, the Promisee opts to put an end to the contract and treat the anticipatory breach as actual breach, the amount of damages shall Price prevailing as on the date of refusal to perform -Contract Price. A. True B. Partly True C. False D. Partly False
Q. 10
X agrees to deliver 10 bags of Wheat to Y at a certain price on 2nd Oct. If X has performed part of the contract, say 80 bags, and then refuses or fails to deliver the remaining goods, it amounts to A. Anticipatory Breach during the course of performance B. Actual Breach during the course the performance C. Anticipatory Breach on the due date of performance D. Actual Breach on the due date of performance
Q. 11
A sold a tin of disinfectant powder to K without warning knowing fully that if the tin was not opened with care, it will likely to cause injury. K was injured while opening the tin. Which of the following statement(s) is/are correct? A. A is not liable to K under the Doctrine of caveat emptor B. A is liable for the damages C. A has not duty to disclose the facts to K D. The buyer has the responsibility to enquire about all the things before purchasing the goods.
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Q. 12
When prior to the due date of performance, the promisor absolutely refuses to perform the contract, it is known as A. Abandonment of contract B. Remission of contract C. Actual breach of contract D. Anticipatory breach of contract
Q. 13
Breach of contract may be A. Actual breach of contract B. Anticipatory breach of contract C. (a) or (b) D. (a) not (b)
Q. 14
An anticipatory breach does not give any right to claim A. Damages B. Compensation C. Either (a) or (b) D. Both (a) and (b)
Q. 15
Anticipatory breach comes under A. Law of Contractual relationship B. Law of Mutual consent C. Law of Mutual agency D. Law of limitation
Q. 16
In case of anticipatory breach the agreed party may treat the contract A. as operative and wait till the time for performance arrives B. As discharged and bring an immediate auction for damages C. Exercise option either (a) or (b) D. Only option (a) is available
Q. 17
Actual breach may be A. During the course of performance B. On the date of performance C. (a) and (b) D. (a) or (b)
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Q. 18
Only such damage are recoverable for the breach of contract as A. Arise naturally in the usual course of the things B. Arise remotely from the breach of contract C. Arise naturally as well as remotely form the breach of contract D. Arise only specially from the breach of contract
Q. 19
In breach of contract, compensation is claimed for A. the proximate and natural consequences of breach B. indirect consequence of the breach C. remote consequence of the breach D. All of the above
Q. 20
Penalty associated with contract is A. a payment of money stipulated as in agreement B. a genuine converted pre-estimate of damages C. punishment for breach of contract D. damages awarded for breach of contract in special circumstances
Q. 21
A party entitled to rescind the contract, loses the remedy when A. He has ratified the contract B. The third party has acquired right in good faith C. Contract is not separable D. All of these
Q. 22
A invited B to a Birthday party. B promised to attend and give A Rs. 500 as a present on his birthday. B failed to attend. What are remedies for A A. A cannot recover any damages from B B. A can file suit for recovery of Rs. 500 C. A can file a suit for breaking the promise D. A cannot file a suit for breaking the promise
Q. 23
Which is true statement in voidable contract, the injured party A. Is entitled to recover compensation B. Has a right to sue for damages C. Has a right to rescind the contract D. All of these
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Q. 24
A' lends a Horse to 'B' for his own riding only 'B' and 'C', his wife, to ride the horse, 'C' rides with care, but the horse accidentally falls and is injured. Decide the liability A. A will not be liable B. A's wife will be liable C. A is liable to make compensation D. Nobody will be liable
Q. 25
A invites B to stay with him during winter vacation. B accepts the invitation and informs A accordingly when B reaches A's house he finds it locked and he has to stay in a hotel. Can B claim damages from A A. B can claim damages B. B cannot claim any damages C. B can file a suit against A D. None of these
Q. 26
Compensation shall not be given for any remote and indirect loss sustained by reason of breach it is A. TRUE B. Partly true C. FALSE D. Partly false
Q. 27
A' buys readymade shirt for his son, The shirt does not exactly fit his son. Decide A. A has no right to return or exchange the same B. A has right to return the same C. He will demand for damages D. He may file a suit for exchange
Q. 28
In case ofthe measure of damages depends upon the shock to the sentiments of the Promisee. A. Special Damages B. Nominal Damages C. Vindictive Damages D. General Damages
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Q. 29 X was shopping in a self-service super market. He picked up a bottle of mango squash from a shelf. While he was examining it, the bottle exploded in his hand and injured him. Can X claim damages for the injury? A. X cannot claim damages B. X can claim damages C. X has to pay price for the bottle D. None of the above
Q. 30
Ordinarily the following damages are not recoverable: A. Ordinary damages B. Special damages C. Nominal Damages D. Exemplary damages
Q. 31
Generally, which of the following damages are not recoverable? A. Ordinary damages B. Special damages C. Remote Damages D. Nominal Damages
Q. 32
When there is breach of contract, special damages are awarded only when A. there are special circumstances B. There is special loss C. there is a notice of the likely special loss D. in all cases
Q. 33
A bought a motor car from B He used it for 3 months and thereafter the car was detected to hire been stolen A was compelled to return the car to the true owner: A. A could recover the price from B. B. A can claim damages from B C. A cannot recover anything from B D. B will replace the car
Q. 34
Damages awarded to compensate the injured party for the actual amount of loss suffered by him for breach of contract are known as A. Special Damages B. General / Ordinary Damages C. Nominal Damages D. Vindictive Damages
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Q. 35 Special Damages can be claimed if the party breaking the contract is made known of the special circumstances at any time after the breach. It is A. True B. Partly True C. False D. Partly False
Q. 36
Which of the following statements is not correct A. Ordinary damages are recoverable B. Special damage are recoverable only if the parties knew about them C. Remote or indirect damages are not recoverable D. None of these statements is incorrect
Q. 37
Damages awarded with a view to punish the defendant, and not solely with the idea of awarding compensation is A. Nominal Damages B. Special damages C. Exemplary or Vindictive Damages D. Ordinary Damages
Q. 38
Which of the following statement is incorrect? A. Indirect damages are not coverable B. Ordinary damages are recoverable C. Special damages are recoverable only if the parties know about them D. None of them
Q. 39
Special damages can be claimed A. As a matter of right B. When special circumstances resulting in a special loss in case of breach of contract are brought to notice of the other party C. By way of punishment for wrong inflicted D. For loss of reputation
Q. 40
In a breach of contract, if the promisee did not suffer any real damage, he can claim A. Exemplary damages B. General damages C. Nominal damages D. No damages
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Q. 41 Damages arising naturally and directly in the usual course of things are called: A. Ordinary damages B. Special damages C. Exemplary damages D. Nominal Damages Damages which are given when special circumstances are within the contemplation of parties at the times of contract are: A. vindictive damages B. Ordinary damages C. Special damages D. None of the above X promises Y to perform a music concert for 4 days continuously. A wilfully absents on the 4th day Y rescinds the contract. In such case, for the loss sustained due to non-performance in 4th day A. Y can claim compensation B. X can claim compensation C. X cannot claim compensation D. X cannot claim compensation X had bought cloth for making bags for sale during hot season. Due to delay in transit Y was unable to utilize it to his benefit during the tasking season. X sued to recover damages for deterioration (fall in value of cloth arrived after tasking season). Such damages are in the nature of A. vindictive damages B. Nominal Damages C. General Damages D. Special Damages ____________ does not exist A. Liability for special damages B. Liability for exemplary damages C. Liability for nominal damages D. Liability for disciplinary damages The damage awarded by way of punishment is A. Vindictive damages B. Special damages C. Nominal damages D. Ordinary damages Page 25 of 31
Q. 42
Q. 43
Q. 44
Q. 45
Q. 46
Q. 47 Vindictive or exemplary damages may not be awarded A. For breach of promise to divorce B. For breach of promise to marry C. Wrongful dishonor by a banker of his customer's cheque D. None of these Where there is breach of contract, special damages are awarded only when A. There are special circumstances B. There is special loss C. There is notice of the likely special loss D. In all cases Vindictive damages are awarded A. For wrongful dishonour of cheque by a banker B. For a breach of promise to marry C. Neither (a) nor (b) D. Either (a) or (b) The essence of liquidated damages is A. Damages payable in cash B. Genuine pre-estimate of probable loss that much ensure as a break of contract C. Loss suffered on non - performance of the contract D. Lump sum payment on an injury caused Which of the statement is true? A. A penalty is the sum disproportionate to the damage likely to accrue as result of breach B. No damages are payable for breach of a contract C. No damages can be recovered for physical loss D. None of these
Q. 48
Q. 49
Q. 50
Q. 51
Q. 52
A contract is discharged by rescission which means the A. Change in one or more terms of the contract B. Acceptance of lesser performance C. Abandonment of rights by a party D. Cancellation of the existing contract
Q. 53
X, a Shopkeeper leaves his goods at Y's place by mistake. Y treats the same as his own and uses it. Y is bound to compensate X for it, under the principles of A. Quantum Meruit B. Damages C. Specific Performance D. Rescission Page 26 of 31
Q. 54
Quantum Meruit means A. As much as gained B. As much as earned C. A contract for the sale D. The fact in itself
Q. 55
To file a suit under Quantum Meruit, the original contract must have been discharged, by the breach of a party by non-performance. It is A. True B. Partly True C. False D. Partly False
Q. 56
A claim on quantum meruit arises A. when an agreement is discovered to be void B. when a contract is divisible C. (a) or (b) D. none of the above
Q. 57
When monetary compensation by way of damages may not constitute adequate remedy for breach of contract, the Courts may order specific performance. This statement is A. True B. Partly True C. False D. Partly False
Q. 58
Remedies of breach of warranty includes A. Diminution or extinction of price B. Refusal to pay the price of goods C. Suit for loss exceeding price of goods D. All of the above
Q. 59
When a contract is divisible, and one party has enjoyed the benefit of part performance, then, the other party may sue on quantum meruit, it is A. True B. Partly True C. False D. Partly False Page 27 of 31
Q. 60
Sometimes, party is entitled to claim compensation in proportion to the work done by him. It is possible by a suit for A. damages B. injunction C. quantum merit D. none of these
Q. 61
In case of breach of contract, which of the following remedy is available to the aggrieved part? A. Suit for rescission B. Suit for damages C. Suit for specific performance D. All of these
Q. 62
Remedies available for breach of contract are: A. Dissolution of the firm B. Charging extra fees from the party committing the breach C. Suit for Specific Performance D. None of the above
Q. 63
D P Tyre Co. Ltd. Sold tyres to a dealer S, who sold those to D, a sub-dealer on the condition that those tyres would not be sold at a price lower than the list price fixed by D P Tyre Co. Ltd. and if the tyres were sold at a price lower than the list price, a penalty of $2 for every tyre sold below the list price would be recovered as damages. D sold five tyres below the list price. D P Tyre Co. Ltd. filed a suit against S. Is D P Tyre Co. Ltd. entitled to maintain the suit? A. No; since D P Tyre Co. Ltd. was not a party to the contract B. No; since only 5 tyres are involved and the amount is insignificant C. Yes as D P Tyre Co. Ltd. is the producer of the tyres D. Yes as D P Tyre Co. Ltd. sold the tyres to S who in turn sold to D
Q. 64
Suit for specific performance and suit for injunction A. Are remedies which provide the same result B. Are different remedies and they provide different results C. Are not the correct way to act against the party committing the breach D. Are the only correct way to act against the party committing the breach
Page 28 of 31
Q. 65
A contracts to sing for 'B' at a concert for Rs. 5,000 which is paid in advance. 'A' is too ill to sing. Decide best A. A must refund the advance of Rs. 5000 to B B. A is not liable to refund the money C. B' should force 'A' to sing D. A' is liable to refund only 50% of advance money to 'B'
Q. 66
If a creditor does not file a suit against the buyer for recovery of the price within three years the debit becomes A. time barred and hence irrecoverable B. time barred but recoverable C. no time barred D. none of these
Q. 67
A third party to a contract _________ the parties to the contract A. Can sue conditionally B. Cannot use C. Can sue unconditionally D. None of the above
Q. 68
Which of the remedies not available to a defrauded party A. Consideration of the contract B. Rescind the contract C. Insistence on specific performance D. Suit for damages
Page 29 of 31
Performance of Contract:
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
C D A C D D D B D A D D D D B A D D C A C D D B C C C A A
30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58
D A B A B B D B A C D C C A D A C A D A C A A C B A B A C
59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81 82 83 84 85 86
D D C D A C A C B C D B B A D C D B D D A C A D D A D B
Page 30 of 31
Breach of Contract:
1 B 2 C 3 A 4 B 5 A 6 A 7 D 8 D 9 A 10 B 11 B 12 D 13 C 14 B 15 A 16 C 17 D 18 A 19 A 20 A 21 D 22 A 23 D 24 C
25 B 26 A 27 A 28 C 29 A 30 D 31 C 32 C 33 A 34 B 35 C 36 D 37 C 38 D 39 B 40 C 41 A 42 C 43 A 44 D 45 D 46 A 47 A 48 C
49 D 50 B 51 A 52 D 53 A 54 B 55 A 56 C 57 A 58 D 59 A 60 C 61 D 62 C 63 A 64 B 65 A 66 A 67 A 68 B
Page 31 of 31

Indian Contract Act-Chapter 1B - Practice Problems

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Indian Contract Act-Chapter 1B - Practice Problems

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FINPREP Practice Questions Chapter Name Indian Contract Act Chapter No.

Practice Questions Subject: Mercantile Law

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A change of nature of obligation of a Contract known as A. Alteration B. repudiation C. Novation D. rescission

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