Question 1

If X makes an offer to Y, which of the following is not an effective means of communicating acceptance?

Accepted Answer

A) Y sends her acceptance by registered post. 
B) Y sends her acceptance by fax. 
C) Y sends her acceptance by SMS. 
D) Y tells X's neighbour of her intention to accept the offer. 
A) Y sends her acceptance by registered post. 
B) Y sends her acceptance by fax. 
C) Y sends her acceptance by SMS. 
D) Y tells X's neighbour of her intention to accept the offer. D

Question 2

X and Y live in the same suburb.X offers to sell Y his luxury yacht and tells Y to respond by post.Y posts a letter accepting the offer.The following evening Y changes her mind and calls X and leaves a message on X's voicemail saying that the offer is not accepted.Which of the following is correct?

Accepted Answer

A) A contract was formed when Y sent the letter and prior to Y's phone call as that was when Y's acceptance will be deemed to have been communicated according to the postal rule. 
B) There is no contract because Y effectively communicated her rejection of the offer. 
C) There is no contract because offers cannot be accepted by post. 
D) A contract was formed as soon as X received Y's voicemail message. 
A) A contract was formed when Y sent the letter and prior to Y's phone call as that was when Y's acceptance will be deemed to have been communicated according to the postal rule. 
B) There is no contract because Y effectively communicated her rejection of the offer. 
C) There is no contract because offers cannot be accepted by post. 
D) A contract was formed as soon as X received Y's voicemail message. A

Question 3

Henry attends his local supermarket with the intention of purchasing a kilogram of ripe mangoes.The contract between Henry and the supermarket proprietor is formed when:

Accepted Answer

A) Henry selects the mangoes of his choice and places them in his shopping basket. 
B) Henry presents the bag of mangoes to the checkout operator. 
C) the checkout operator accepts payment from Henry. 
D) Henry eats the mangoes. 
A) Henry selects the mangoes of his choice and places them in his shopping basket. 
B) Henry presents the bag of mangoes to the checkout operator. 
C) the checkout operator accepts payment from Henry. 
D) Henry eats the mangoes. C

Question 4

For the purposes of contract law, a minor is a person:

Accepted Answer

A) under the age of 18 years. 
B) under the age of 16 years. 
C) under the age of 21 years. 
D) who still lives with their parents. 
A) under the age of 18 years. 
B) under the age of 16 years. 
C) under the age of 21 years. 
D) who still lives with their parents.

Question 5

Which of the following is not one of the benefits of having a contract in writing?

Accepted Answer

A) It provides reliable evidence of the terms of the contract. 
B) It proves that the contract was negotiated fairly. 
C) It makes the parties take the contract seriously. 
D) It proves the existence of the contract. 
A) It provides reliable evidence of the terms of the contract. 
B) It proves that the contract was negotiated fairly. 
C) It makes the parties take the contract seriously. 
D) It proves the existence of the contract.

Question 6

A contract to provide a minor with necessaries is enforceable against the minor.'Necessaries' do not include:

Accepted Answer

A) medical treatment. 
B) a school uniform. 
C) overseas travel. 
D) school fees. 
A) medical treatment. 
B) a school uniform. 
C) overseas travel. 
D) school fees.

Question 7

Xavier is a landlord and Logan his tenant.Xavier wants to renovate the house that Logan lives in and gives Logan three months' notice to leave in accordance with the terms of the lease.Logan requests more time to find new accommodation, and Xavier agrees to give him four months.Logan finds new accommodation but he has arranged it such that he will move into the new place only at the expiration of the four months.Three months after giving notice, Xavier tries to evict Logan.Can he do so?

Accepted Answer

A) No.Promissory estoppel prevents Xavier from going back on a promise that Logan has relied on. 
B) Yes.Logan gave no consideration for the promise of an extra month. 
C) Yes.Xavier was following the terms of the contract. 
D) No.Xavier is in breach of the contract. 
A) No.Promissory estoppel prevents Xavier from going back on a promise that Logan has relied on. 
B) Yes.Logan gave no consideration for the promise of an extra month. 
C) Yes.Xavier was following the terms of the contract. 
D) No.Xavier is in breach of the contract.

Question 8

Which of the following is not valid consideration?

Accepted Answer

A) The payment of money. 
B) The provision of goods. 
C) Undertaking an onerous obligation. 
D) A promise not to carry out a crime. 
A) The payment of money. 
B) The provision of goods. 
C) Undertaking an onerous obligation. 
D) A promise not to carry out a crime.

Question 9

Which of the following contracts are not illegal under common law?

Accepted Answer

A) A contract to defame a celebrity 
B) A contract to bribe a politician 
C) A contract to restructure your business to maximise tax concessions 
D) A contract not to appear as a witness in a criminal trial 
A) A contract to defame a celebrity 
B) A contract to bribe a politician 
C) A contract to restructure your business to maximise tax concessions 
D) A contract not to appear as a witness in a criminal trial

Question 10

Which of the following is one of the requirements necessary to establish promissory estoppel?

Accepted Answer

A) The promisor makes a vague promise to waive some contractual obligations. 
B) The promisee disregards the promise. 
C) It would be unconscionable (unfair) for the promisor to break the promise. 
D) The promise is in writing. 
A) The promisor makes a vague promise to waive some contractual obligations. 
B) The promisee disregards the promise. 
C) It would be unconscionable (unfair) for the promisor to break the promise. 
D) The promise is in writing.

Question 11

Which of the following statements is not true of a deed?

Accepted Answer

A) A deed is a formal written contract. 
B) A deed is signed by the parties before a witness and expressed to be sealed and delivered. 
C) A deed is a formal written contract expressed to be a deed. 
D) When enforcing a deed it is necessary to show that the promisee provided consideration for the promise. 
A) A deed is a formal written contract. 
B) A deed is signed by the parties before a witness and expressed to be sealed and delivered. 
C) A deed is a formal written contract expressed to be a deed. 
D) When enforcing a deed it is necessary to show that the promisee provided consideration for the promise.

Question 12

A contract for the sale of goods that are not necessaries will be enforceable where entered into with a person of impaired intellectual capacity unless:

Accepted Answer

A) the impaired person understood the nature of the agreement and the other party did not know about the impaired person's lack of capacity. 
B) the other party knew about the impaired person's lack of capacity and the impaired person was not capable of understanding the nature of the agreement being entered into. 
C) the impaired person was incapable of understanding the nature of the agreement even though the other party did not know about the impaired person's lack of capacity. 
D) the contract was for luxury goods. 
A) the impaired person understood the nature of the agreement and the other party did not know about the impaired person's lack of capacity. 
B) the other party knew about the impaired person's lack of capacity and the impaired person was not capable of understanding the nature of the agreement being entered into. 
C) the impaired person was incapable of understanding the nature of the agreement even though the other party did not know about the impaired person's lack of capacity. 
D) the contract was for luxury goods.

Question 13

If parties to a contract agree that it will not be legally enforceable until the happening of a certain event, that term of the contract is known as a:

Accepted Answer

A) condition precedent. 
B) condition subsequent. 
C) qualified term. 
D) prior term. 
A) condition precedent. 
B) condition subsequent. 
C) qualified term. 
D) prior term.

Question 14

The presumption that an agreement made in a social or domestic context was not intended to be legally enforceable can be rebutted by:

Accepted Answer

A) severing the friendship with the other party to the agreement 
B) issuing legal proceedings against the other party to the agreement 
C) proving that the other party to the agreement is unreliable and not trustworthy. 
D) proving to the court that the parties intended it to be a legally enforceable agreement. 
A) severing the friendship with the other party to the agreement 
B) issuing legal proceedings against the other party to the agreement 
C) proving that the other party to the agreement is unreliable and not trustworthy. 
D) proving to the court that the parties intended it to be a legally enforceable agreement.

Question 15

Complete the following: Agreement + (1) + Consideration = Contract,
Where Agreement = (2) + (3).

Accepted Answer

A) (1) = intention, (2) = advertisement, (3) = payment. 
B) (1) = payment, (2) = intention, (3) = promise. 
C) (1) = intention, (2) = offer, (3) = acceptance. 
D) (1) = payment, (2) = offer, (3) = acceptance. 
A) (1) = intention, (2) = advertisement, (3) = payment. 
B) (1) = payment, (2) = intention, (3) = promise. 
C) (1) = intention, (2) = offer, (3) = acceptance. 
D) (1) = payment, (2) = offer, (3) = acceptance.

Question 16

When a product is bought from the supermarket, the contract is usually formed:

Accepted Answer

A) when the customer lifts the product off the shelf and puts the product into the basket. 
B) when the customer holds onto the product for more than twenty minutes preventing other customers from buying that product. 
C) when the customer takes the product to the cashier and offers payment. 
D) when the cashier accepts payment for the product. 
A) when the customer lifts the product off the shelf and puts the product into the basket. 
B) when the customer holds onto the product for more than twenty minutes preventing other customers from buying that product. 
C) when the customer takes the product to the cashier and offers payment. 
D) when the cashier accepts payment for the product.

Question 17

Max owns a Van Gogh painting.Nigel wants to know if he will sell it and sends Max an email asking for the price of the painting.Max immediately responds by saying that Nigel can have the painting for $4 million and that the painting will be shipped to Nigel's residence in 4 days.Which of the following is true?

Accepted Answer

A) Max has accepted Nigel's offer. 
B) There is no contract.Nigel was merely requesting information. 
C) Nigel has accepted Max's offer. 
D) Max and Nigel have entered into a binding contract. 
A) Max has accepted Nigel's offer. 
B) There is no contract.Nigel was merely requesting information. 
C) Nigel has accepted Max's offer. 
D) Max and Nigel have entered into a binding contract.

Question 18

Which of the following is an example of a lack of intellectual capacity?

Accepted Answer

A) Intoxication 
B) Immaturity 
C) Laziness 
D) Duress 
A) Intoxication 
B) Immaturity 
C) Laziness 
D) Duress

Question 19

James is the owner of LowCal, a local sandwich bar.He offers to sell the business to Jansen, a wealthy 17-year old, for $50 000.Jansen accepts the offer but on the day when the contract is to be performed, James tells Jansen that he has changed his mind and no longer wishes to sell the business.What can Jansen do?

Accepted Answer

A) Nothing, because Jansen is a minor and therefore incapable of enforcing a contract. 
B) Enforce the contract, because sandwiches are food and therefore it is a contract for 'necessaries'. 
C) Enforce the contract, because contracts are still enforceable by minors even if they are not enforceable against minors. 
D) Nothing, because James is entitled to change his mind. 
A) Nothing, because Jansen is a minor and therefore incapable of enforcing a contract. 
B) Enforce the contract, because sandwiches are food and therefore it is a contract for 'necessaries'. 
C) Enforce the contract, because contracts are still enforceable by minors even if they are not enforceable against minors. 
D) Nothing, because James is entitled to change his mind.

Question 20

The consequences of forming a contract that contravenes the terms of a statute:

Accepted Answer

A) Are that the parties are penalised. 
B) Are that the contract is invalid. 
C) Are that the parties are penalised and the contract is valid. 
D) Depend upon the wording of the statute. 
A) Are that the parties are penalised. 
B) Are that the contract is invalid. 
C) Are that the parties are penalised and the contract is valid. 
D) Depend upon the wording of the statute.

If X makes an offer to Y, which of the following is not an effective means of communicating acceptance?

X and Y live in the same suburb.X offers to sell Y his luxury yacht and tells Y to respond by post.Y posts a letter accepting the offer.The following evening Y changes her mind and calls X and leaves a message on X's voicemail saying that the offer is not accepted.Which of the following is correct?

Henry attends his local supermarket with the intention of purchasing a kilogram of ripe mangoes.The contract between Henry and the supermarket proprietor is formed when:

For the purposes of contract law, a minor is a person:

Which of the following is not one of the benefits of having a contract in writing?

A contract to provide a minor with necessaries is enforceable against the minor.'Necessaries' do not include:

Which of the following is not valid consideration?

Which of the following contracts are not illegal under common law?

Which of the following is one of the requirements necessary to establish promissory estoppel?

Which of the following statements is not true of a deed?

A contract for the sale of goods that are not necessaries will be enforceable where entered into with a person of impaired intellectual capacity unless:

If parties to a contract agree that it will not be legally enforceable until the happening of a certain event, that term of the contract is known as a:

The presumption that an agreement made in a social or domestic context was not intended to be legally enforceable can be rebutted by:

Complete the following: Agreement + (1) + Consideration = Contract, Where Agreement = (2) + (3).

When a product is bought from the supermarket, the contract is usually formed:

Which of the following is an example of a lack of intellectual capacity?

The consequences of forming a contract that contravenes the terms of a statute:

Business and the Law

The Australian Legal System

Politicians and Judges

How to Find, Understand and Use the Law

Deliberately Causing Harm

Carelessly Causing Harm

Contract Law: Terms of the Contract

Contract Law: Enforcement of the Contract

Contract Law: Working With Agents

Dealing With Consumers

Dealing With Competitors

Protecting Ip

Managing a Business: Start-Up

Managing a Business: Business Ownership

Managing a Business: Companies and Corporate Governance

Managing a Business: Making Payments and Recovering Debts

Managing a Business: Insurance and Taxes

Managing a Business: Employing Workers

Managing a Business: Closing Down

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Exam 7: Contract Law: Formation of the Contract

If X makes an offer to Y, which of the following is not an effective means of communicating acceptance?

X and Y live in the same suburb.X offers to sell Y his luxury yacht and tells Y to respond by post.Y posts a letter accepting the offer.The following evening Y changes her mind and calls X and leaves a message on X's voicemail saying that the offer is not accepted.Which of the following is correct?

Henry attends his local supermarket with the intention of purchasing a kilogram of ripe mangoes.The contract between Henry and the supermarket proprietor is formed when:

For the purposes of contract law, a minor is a person:

Which of the following is not one of the benefits of having a contract in writing?

A contract to provide a minor with necessaries is enforceable against the minor.'Necessaries' do not include:

Which of the following is not valid consideration?

Which of the following contracts are not illegal under common law?

Which of the following is one of the requirements necessary to establish promissory estoppel?

Which of the following statements is not true of a deed?

A contract for the sale of goods that are not necessaries will be enforceable where entered into with a person of impaired intellectual capacity unless:

If parties to a contract agree that it will not be legally enforceable until the happening of a certain event, that term of the contract is known as a:

The presumption that an agreement made in a social or domestic context was not intended to be legally enforceable can be rebutted by:

Complete the following: Agreement + (1) + Consideration = Contract, Where Agreement = (2) + (3).

When a product is bought from the supermarket, the contract is usually formed:

Which of the following is an example of a lack of intellectual capacity?

The consequences of forming a contract that contravenes the terms of a statute:

Business and the Law

The Australian Legal System

Politicians and Judges

How to Find, Understand and Use the Law

Deliberately Causing Harm

Carelessly Causing Harm

Contract Law: Terms of the Contract

Contract Law: Enforcement of the Contract

Contract Law: Working With Agents

Dealing With Consumers

Dealing With Competitors

Protecting Ip

Managing a Business: Start-Up

Managing a Business: Business Ownership

Managing a Business: Companies and Corporate Governance

Managing a Business: Making Payments and Recovering Debts

Managing a Business: Insurance and Taxes

Managing a Business: Employing Workers

Managing a Business: Closing Down

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