Question 1

Mutual discharge occurs when:

Accepted Answer

A) one party leads the other to reasonably believe that strict performance will not be insisted upon. 
B) a new agreement is substituted for the old by the parties. 
C) both parties abandon their original agreement while it is still executory. 
D) a party who has already performed their obligation agrees to relieve the other party from performing their obligation in return for their doing something different. 
A) one party leads the other to reasonably believe that strict performance will not be insisted upon. 
B) a new agreement is substituted for the old by the parties. 
C) both parties abandon their original agreement while it is still executory. 
D) a party who has already performed their obligation agrees to relieve the other party from performing their obligation in return for their doing something different. C

Question 2

Which of the following is LEAST likely to be classified as a breach of contract?

Accepted Answer

A) A delay by one party in carrying out their obligations where time is of the essence. 
B) A failure by one party to comply with one of the terms of the contract. 
C) An announcement by one party that they do not intend to carry out their obligations under the contract. 
D) A failure by one party to exercise reasonable care in carrying out their obligations under the contract. 
A) A delay by one party in carrying out their obligations where time is of the essence. 
B) A failure by one party to comply with one of the terms of the contract. 
C) An announcement by one party that they do not intend to carry out their obligations under the contract. 
D) A failure by one party to exercise reasonable care in carrying out their obligations under the contract. D

Question 3

Which of the following is the best description of discharge by waiver?

Accepted Answer

A) One party leads the other to reasonably believe that strict performance will not be insisted upon. 
B) A new agreement is substituted for the old by the parties. 
C) Both parties abandon their original agreement while it is still executory. 
D) A party who has already performed their obligation agrees to relieve the other party from performing their obligation in return for their doing something different. 
A) One party leads the other to reasonably believe that strict performance will not be insisted upon. 
B) A new agreement is substituted for the old by the parties. 
C) Both parties abandon their original agreement while it is still executory. 
D) A party who has already performed their obligation agrees to relieve the other party from performing their obligation in return for their doing something different. A

Question 4

Which of the following is the best description of 'privity of contract'?

Accepted Answer

A) A third party is entitled to bring an action to enforce a contract to which they are not a party if they have the consent of one of the parties to do so. 
B) The parties to the contract are under an obligation not to disclose the details of the contract to third parties. 
C) Only the persons who are parties to the contract can acquire rights and incur liabilities under it. 
D) The parties to the contract are only obliged to comply with the terms of the agreement and are not obliged to do any more than this. 
A) A third party is entitled to bring an action to enforce a contract to which they are not a party if they have the consent of one of the parties to do so. 
B) The parties to the contract are under an obligation not to disclose the details of the contract to third parties. 
C) Only the persons who are parties to the contract can acquire rights and incur liabilities under it. 
D) The parties to the contract are only obliged to comply with the terms of the agreement and are not obliged to do any more than this.

Question 5

A novation is a tripartite agreement whereby the parties agree to substitute one original party with the third party in what is a new agreement.

Accepted Answer

A) True 
 B)False

Question 6

The decision of the court in Cutter v Powell (1795)101 ER 573 was that:

Accepted Answer

A) The contract was divisible and the widow could recover the proportion of the contract amount equal to the number of days that Cutter had completed before he died. 
B) The contract was entire and hence the widow could recover nothing. 
C) Cutter's death terminated the contract and the contract was therefore void. 
D) The widow of the deceased was entitled to payment based on a quantum meruit. 
A) The contract was divisible and the widow could recover the proportion of the contract amount equal to the number of days that Cutter had completed before he died. 
B) The contract was entire and hence the widow could recover nothing. 
C) Cutter's death terminated the contract and the contract was therefore void. 
D) The widow of the deceased was entitled to payment based on a quantum meruit.

Question 7

In which of the following circumstances will partial performance of a contract by one party NOT give rise to a right to payment?

Accepted Answer

A) Where the contract is entire. 
B) Where the other party has prevented them from completing the contract. 
C) Where the other party has freely and willingly accepted their partial performance. 
D) Where they have substantially,but not completely,performed the contract. 
A) Where the contract is entire. 
B) Where the other party has prevented them from completing the contract. 
C) Where the other party has freely and willingly accepted their partial performance. 
D) Where they have substantially,but not completely,performed the contract.

Question 8

Why did the court find that the contract was frustrated in the case of: Codelfa Construction Pty Ltd v State Rail Authority (NSW)(1982)149 CLR 337?

Accepted Answer

A) Due to the declaration of war and the consequent impossibility of performing the contract. 
B) Due to the non-occurrence of an event essential to achieve the substantial purpose of the contract. 
C) Due to the fundamental and radical change in the circumstances of the contract. 
D) Due to the complete destruction of the subject matter of the contract. 
A) Due to the declaration of war and the consequent impossibility of performing the contract. 
B) Due to the non-occurrence of an event essential to achieve the substantial purpose of the contract. 
C) Due to the fundamental and radical change in the circumstances of the contract. 
D) Due to the complete destruction of the subject matter of the contract.

Question 9

A discharge of contract by frustration happens when:

Accepted Answer

A) one of the parties becomes bankrupt. 
B) each party discharges the obligation of the other to perform the contract. 
C) one of the parties fails to carry out their obligation completely,and the other party accepts this. 
D) performance of the contract becomes impossible due to the occurrence of an unforeseen event. 
A) one of the parties becomes bankrupt. 
B) each party discharges the obligation of the other to perform the contract. 
C) one of the parties fails to carry out their obligation completely,and the other party accepts this. 
D) performance of the contract becomes impossible due to the occurrence of an unforeseen event.

Question 10

Which of the following will NOT result in the discharge of a contract by operation of law?

Accepted Answer

A) The merger of a simple contract into a formal contract. 
B) The death of one of the parties to a contract other than for personal services. 
C) The material alteration of a written contract without the consent of the other party. 
D) The bankruptcy of one of the parties. 
A) The merger of a simple contract into a formal contract. 
B) The death of one of the parties to a contract other than for personal services. 
C) The material alteration of a written contract without the consent of the other party. 
D) The bankruptcy of one of the parties.

Question 11

A waiver is where one party leads the other to reasonably believe that strict performance will not be insisted upon.

Accepted Answer

A) True 
 B)False

Question 12

What factors must be present in order for a contract to be discharged by frustration?

Accepted Answer

In order for frustration to be successfu

Question 13

Payment of money due under a contract must be made to the other party at its normal place of business or as directed by the contract.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is NOT one of the requirements which must be satisfied before a contract will be frustrated?

Accepted Answer

A) The frustrating event was outside of the control of the parties. 
B) It would be unjust to hold the parties to the original contract. 
C) The frustrating event was foreseen and referred to in the contract. 
D) The frustrating event has significantly or radically changed the obligations of the parties. 
A) The frustrating event was outside of the control of the parties. 
B) It would be unjust to hold the parties to the original contract. 
C) The frustrating event was foreseen and referred to in the contract. 
D) The frustrating event has significantly or radically changed the obligations of the parties.

Question 15

Which of the following is the best description of discharge by release?

Accepted Answer

A) A party who has already performed their obligation chooses to relieve the other party from performing their obligation. 
B) Both parties abandon their original agreement while it is still executory. 
C) One party leads the other to reasonably believe that strict performance will not be insisted upon. 
D) A party who has already performed their obligation agrees to relieve the other party from performing their obligation in return for their doing something different. 
A) A party who has already performed their obligation chooses to relieve the other party from performing their obligation. 
B) Both parties abandon their original agreement while it is still executory. 
C) One party leads the other to reasonably believe that strict performance will not be insisted upon. 
D) A party who has already performed their obligation agrees to relieve the other party from performing their obligation in return for their doing something different.

Question 16

The decision of the court in Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd [1943] AC 32 was:

Accepted Answer

A) That the manufacturer of the machine which was being built to meet the order of the purchaser could not recover the cost of manufacturing the machine because the frustrating event had intervened to terminate the contract. 
B) That the purchaser of the machine could recover the deposit which it had paid. 
C) That the contract was terminated by frustration. 
D) All of the above. 
A) That the manufacturer of the machine which was being built to meet the order of the purchaser could not recover the cost of manufacturing the machine because the frustrating event had intervened to terminate the contract. 
B) That the purchaser of the machine could recover the deposit which it had paid. 
C) That the contract was terminated by frustration. 
D) All of the above.

Question 17

Which of the following is NOT an exception to the doctrine of privity of contract?

Accepted Answer

A) Estoppel. 
B) Negotiable instruments. 
C) A lease. 
D) A contract for the sale of land. 
A) Estoppel. 
B) Negotiable instruments. 
C) A lease. 
D) A contract for the sale of land.

Question 18

Explain the meaning of novation and what does it create.

Accepted Answer

A novation is a tripartite agreement whe

Question 19

Which of the following involves the discharge of a contract by performance?

Accepted Answer

A) One of the parties becomes bankrupt. 
B) Each party discharges the obligation of the other to perform the contract. 
C) The parties carry out exactly the terms of the contract. 
D) Performance of the contract becomes impossible due to the occurrence of an unforeseen event. 
A) One of the parties becomes bankrupt. 
B) Each party discharges the obligation of the other to perform the contract. 
C) The parties carry out exactly the terms of the contract. 
D) Performance of the contract becomes impossible due to the occurrence of an unforeseen event.

Question 20

An assignment of a debt at common law:

Accepted Answer

A) requires clear evidence of intention plus consideration from the assignee to the assignor. 
B) is impossible because it is prohibited. 
C) requires notice to the debtor plus consideration from the assignee to the assignor. 
D) stipulates that an assignment in writing signed by the assignor. 
A) requires clear evidence of intention plus consideration from the assignee to the assignor. 
B) is impossible because it is prohibited. 
C) requires notice to the debtor plus consideration from the assignee to the assignor. 
D) stipulates that an assignment in writing signed by the assignor.

Exam 14: Rights and Liabilities of the Parties,discharge and Remedies

Mutual discharge occurs when:

Which of the following is LEAST likely to be classified as a breach of contract?

Which of the following is the best description of discharge by waiver?

Which of the following is the best description of 'privity of contract'?

A novation is a tripartite agreement whereby the parties agree to substitute one original party with the third party in what is a new agreement.

The decision of the court in Cutter v Powell (1795)101 ER 573 was that:

In which of the following circumstances will partial performance of a contract by one party NOT give rise to a right to payment?

Why did the court find that the contract was frustrated in the case of: Codelfa Construction Pty Ltd v State Rail Authority (NSW)(1982)149 CLR 337?

A discharge of contract by frustration happens when:

Which of the following will NOT result in the discharge of a contract by operation of law?

A waiver is where one party leads the other to reasonably believe that strict performance will not be insisted upon.

What factors must be present in order for a contract to be discharged by frustration?

Payment of money due under a contract must be made to the other party at its normal place of business or as directed by the contract.

Which of the following is NOT one of the requirements which must be satisfied before a contract will be frustrated?

Which of the following is the best description of discharge by release?

The decision of the court in Fibrosa Spolka Akcyjna v Fairbairn Lawson Combe Barbour Ltd [1943] AC 32 was:

Which of the following is NOT an exception to the doctrine of privity of contract?

Explain the meaning of novation and what does it create.

Which of the following involves the discharge of a contract by performance?

An assignment of a debt at common law:

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