Question 1

When will silence distort a previous assertion?

Accepted Answer

A) whenever a change in circumstances occurs 
B) whenever a change in circumstances does not affect the accuracy of a representation 
C) when a contract requires a duty of utmost good faith 
D) when a change in circumstances affects the accuracy of an earlier pre-contractual representation 
E) when a statutory provision requires disclosure 
A) whenever a change in circumstances occurs 
B) whenever a change in circumstances does not affect the accuracy of a representation 
C) when a contract requires a duty of utmost good faith 
D) when a change in circumstances affects the accuracy of an earlier pre-contractual representation 
E) when a statutory provision requires disclosure

Question 2

An exception to the parol evidence rule may arise if

Accepted Answer

A) both parties want to rescind the contract. 
B) the plaintiff will not be able to successfully claim damages otherwise. 
C) the judge is convinced that the contract would be more effective if it contained additional terms. 
D) Evidence of matter extrinsic to the written document required in order to rectify a mistake made in the written document 
E) the wording of the document is unfair to one of the parties. 
A) both parties want to rescind the contract. 
B) the plaintiff will not be able to successfully claim damages otherwise. 
C) the judge is convinced that the contract would be more effective if it contained additional terms. 
D) Evidence of matter extrinsic to the written document required in order to rectify a mistake made in the written document 
E) the wording of the document is unfair to one of the parties.

Question 3

Petros is the sole proprietor of a river rafting company in Banff.He is drafting a standard form contract for his customers and is considering how to protect himself and his company.He is worried about customers being injured while rafting,but doesn't want it to seem like he doesn't care about their safety,so he wants to keep some responsibility.He also wants to ensure the section of river he takes his clients down remains a secret so people will continue to patronize him.Petros should include which of the following clauses?

Accepted Answer

A) An exclusion clause that has customers accept all risk for injury 
B) A confidentiality clause that prohibits customers from telling their friends about the scenery 
C) A force majeure clause that exempts him from superior or irresistible forces 
D) An arbitration clause to resolve any disputes 
E) An entire agreement clause ensuring there can be no agreements outside the contract 
A) An exclusion clause that has customers accept all risk for injury 
B) A confidentiality clause that prohibits customers from telling their friends about the scenery 
C) A force majeure clause that exempts him from superior or irresistible forces 
D) An arbitration clause to resolve any disputes 
E) An entire agreement clause ensuring there can be no agreements outside the contract

Question 4

Jacqui purchased a business from Dickie.During the pre-contractual negotiations,Dickie said,based on past experience,he expected that the business would earn approximately $1 million per year.After that statement was made,but before the contract was signed,Dickie learned that the manufacturer that supplied his business with the materials that it needed was going out of business.Dickie realized that,because of the need to purchase materials from another manufacturer,his business could only be expected to earn $700 000 per year,regardless of whether it was run by himself or by Jacqui.Afraid that that news would scare off Jacqui,Dickie decided to keep the new information to himself.Jacqui completed the purchase of Dickie's business,but was very disappointed when it earned only $700 000 in its first year.She now wants to sue Dickie.Which of the following statements is TRUE?

Accepted Answer

A) While Jacqui probably is entitled to damages,she cannot possibly receive rescission because the contract has already been completed. 
B) Dickie cannot be held liable because his statement was an opinion about the future. 
C) Dickie cannot be held liable because Jacqui ought to have independently confirmed his statements. 
D) Jacqui cannot successfully sue unless she can prove that Dickie's statements regarding the business's profits became a term of their contract. 
E) Jacqui may be able to successfully sue Dickie for misrepresentation,on the legal theory that Dickie made a statement of fact then by his silence distorted his previous assertion of fact.However,Dickie may have a defence on the basis that he was not stating a fact about the past but an opinion about the future. 
A) While Jacqui probably is entitled to damages,she cannot possibly receive rescission because the contract has already been completed. 
B) Dickie cannot be held liable because his statement was an opinion about the future. 
C) Dickie cannot be held liable because Jacqui ought to have independently confirmed his statements. 
D) Jacqui cannot successfully sue unless she can prove that Dickie's statements regarding the business's profits became a term of their contract. 
E) Jacqui may be able to successfully sue Dickie for misrepresentation,on the legal theory that Dickie made a statement of fact then by his silence distorted his previous assertion of fact.However,Dickie may have a defence on the basis that he was not stating a fact about the past but an opinion about the future.

Question 5

Which of the following statements is TRUE with respect to a contractual clause that protects one party from the consequences of breach (exclusion or limitation of liability clauses)?

Accepted Answer

A) Such clauses are enforced only if they are the product of equal bargaining power. 
B) Such clauses may reduce or limit liability,but they cannot entirely exclude liability. 
C) Such clauses are enforced only if they appear in written and signed contracts. 
D) Depending upon the circumstances,such clauses may be enforced even if the party who wants to sue for breach did not read the clause. 
E) Such clauses are invalid if they are written in language that is difficult for a consumer to understand. 
A) Such clauses are enforced only if they are the product of equal bargaining power. 
B) Such clauses may reduce or limit liability,but they cannot entirely exclude liability. 
C) Such clauses are enforced only if they appear in written and signed contracts. 
D) Depending upon the circumstances,such clauses may be enforced even if the party who wants to sue for breach did not read the clause. 
E) Such clauses are invalid if they are written in language that is difficult for a consumer to understand.

Question 6

Zhou listed a commercial lot for sale,describing the land as being zoned for commercial/residential occupation.Dalvi,who was looking to build a funky billiards bar with condos above,inquired about Zhou's lot.Throughout their negotiations Zhou maintained that the law would allow the purchaser to use the lot for both commercial and residential purposes,and understood that the consequences of the zoning law were critical to Dalvi's business plan.Induced by this,Dalvi subsequently decided to buy the property.After buying the property,Dalvi learned that the land was not zoned as residential and that he was not permitted to build condos above the billiards bar.He sued Zhou,arguing that the inducing statement was actionable as misrepresentation.Will Dalvi succeed in his action? Why?

Accepted Answer

Because everyone is presumed to know the

Question 7

Which of the following is NOT an example of a disclosure required by statute?

Accepted Answer

A) disclosure of a serious medical condition when obtaining life insurance 
B) disclosure of material facts by a financial officer of a publically traded corporation 
C) disclosure of significant liabilities that exist when making a domestic (family law)contract 
D) disclosure of material facts pertaining to the sale of securities 
E) disclosure of material facts by an accountant when she sells her car to one of her clients 
A) disclosure of a serious medical condition when obtaining life insurance 
B) disclosure of material facts by a financial officer of a publically traded corporation 
C) disclosure of significant liabilities that exist when making a domestic (family law)contract 
D) disclosure of material facts pertaining to the sale of securities 
E) disclosure of material facts by an accountant when she sells her car to one of her clients

Question 8

Damages for actionable misrepresentation are available in the contract law depending on the type of misrepresentation that was made.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following approaches to contractual interpretation will ONLY SOMETIMES give words their plain,ordinary meaning?

Accepted Answer

A) the literal approach 
B) the contextual approach 
C) the golden rule 
D) the contra proferentum rule 
E) the parol evidence rule 
A) the literal approach 
B) the contextual approach 
C) the golden rule 
D) the contra proferentum rule 
E) the parol evidence rule

Question 10

Ranjit purchased a complex computer system from Compu-Less.Although Compu-Less had specially manufactured the computer to Ranjit's personal specifications,the sale was created on the basis of a standard form agreement that the company uses when customers buy mass-produced computer units.A dispute has now arisen between Ranjit and Compu-Less.Which of the following statements is TRUE?

Accepted Answer

A) The strict terms of the contract will not be enforced if,before Ranjit signed the agreement,the company's sales manager said,"Don't worry about the legal mumbo-jumbo.We stand behind our products." 
B) Because of the parol evidence rule,the parties' contract will not include the warranties contained in the Sale of Goods Act unless the contract either repeats those warranties or at least refers to them. 
C) As long as the language of the contract is sufficiently clear,the parties may have excluded all possible statutory conditions and warranties. 
D) The court may refuse to add an implied term to the contract even if that term would make the contract,in the court's opinion,fairer to Ranjit. 
E) The golden rule of contract interpretation states that an ambiguous term must be interpreted in the way that most benefits the party that did not draft the contract. 
A) The strict terms of the contract will not be enforced if,before Ranjit signed the agreement,the company's sales manager said,"Don't worry about the legal mumbo-jumbo.We stand behind our products." 
B) Because of the parol evidence rule,the parties' contract will not include the warranties contained in the Sale of Goods Act unless the contract either repeats those warranties or at least refers to them. 
C) As long as the language of the contract is sufficiently clear,the parties may have excluded all possible statutory conditions and warranties. 
D) The court may refuse to add an implied term to the contract even if that term would make the contract,in the court's opinion,fairer to Ranjit. 
E) The golden rule of contract interpretation states that an ambiguous term must be interpreted in the way that most benefits the party that did not draft the contract.

Question 11

Restitution requires both sides to be returned to their pre-contractual positions.

Accepted Answer

A) True 
 B)False

Question 12

A standard form business contract requires independent legal advice to the party agreeing to the terms in order to be contractually binding

Accepted Answer

A) whenever a signature is required. 
B) only when its terms are onerous or unusual. 
C) only when its terms are on the back of a ticket. 
D) only in the case of exclusion clauses. 
E) not in any circumstances. 
A) whenever a signature is required. 
B) only when its terms are onerous or unusual. 
C) only when its terms are on the back of a ticket. 
D) only in the case of exclusion clauses. 
E) not in any circumstances.

Question 13

Parol evidence cannot be used to resolve ambiguous terms of a written contract.

Accepted Answer

A) True 
 B)False

Question 14

Standard form agreements

Accepted Answer

A) always balance the interests of both parties. 
B) are rarely offered on a take-it-or-leave-it basis. 
C) often are more time-consuming than negotiating the terms of a new contract. 
D) often contain language that has been refined and tested over the years. 
E) are not binding if the party signing them does not bother to read them. 
A) always balance the interests of both parties. 
B) are rarely offered on a take-it-or-leave-it basis. 
C) often are more time-consuming than negotiating the terms of a new contract. 
D) often contain language that has been refined and tested over the years. 
E) are not binding if the party signing them does not bother to read them.

Question 15

A purchaser bought an oil painting from a private collector who promised that it was painted by one of the members of the Group of Seven,a promise that was held to be one of the terms of the contract.The painting quickly became the purchasers favourite.He took it home and built a special room for its viewing,with an expensive lighting system.Five years later,after having grown somewhat tired of the room,the purchaser decided to sell the painting.In so doing,he discovered much to his chagrin that the painting was worth much less than he had thought as it was,in fact,done by a less famous American painter,who worked in a style similar to the Group of Seven.The purchaser decided to try to get his money back.He sued the private collector who sold it to him,asking the court to rescind the contract on the ground that there had been an innocent misrepresentation.What are the most plausible grounds upon which the court might decide not to rescind?

Accepted Answer

The court would likely hold that after f

Question 16

Why do insurance contracts require a duty of utmost good faith?

Accepted Answer

The duty of utmost good faith arises bec

Question 17

Tyra is looking to buy her first motorcycle.She sees one listed online and contacts Graham,the owner.Graham knows that the transmission is faulty and the bike often doesn't shift properly.Because this doesn't happen all the time,he doesn't make note of it in the listing.Furthermore,he schedules Tyra to come for a test drive when he isn't present,getting his brother to meet her,so that she can't ask him any questions.Tyra buys the bike for full price and doesn't ask any questions.Which of the following statements is most likely true?

Accepted Answer

A) Silence can never be misrepresentation. 
B) Graham's silence is misrepresentation because the contract required utmost good faith. 
C) Graham's actions constituted misrepresentation because he wasn't present for the test drive,actively concealing the damage. 
D) Graham's silence constituted a half-truth. 
E) Graham is not required to disclose the problem in pre-contractual relations. 
A) Silence can never be misrepresentation. 
B) Graham's silence is misrepresentation because the contract required utmost good faith. 
C) Graham's actions constituted misrepresentation because he wasn't present for the test drive,actively concealing the damage. 
D) Graham's silence constituted a half-truth. 
E) Graham is not required to disclose the problem in pre-contractual relations.

Question 18

Justice Howe,a member of the Supreme Court of Canada,is deciding a case that deals with a complicated commercial agreement between two sophisticated and experienced companies.The resolution of the case depends upon the interpretation of several clauses in that agreement.Which of the following statements is TRUE?

Accepted Answer

A) The general rules governing the interpretation of contracts do not apply in the Supreme Court of Canada because that court is expected to arrive at the fairest result regardless of the rules of law. 
B) In order to decide the case,the judge may need to know which party drafted the agreement. 
C) The contextual approach to interpretation requires a particular clause to be interpreted exclusively by reference to its own terms. 
D) The golden rule of interpretation,which says "do unto others as you would have others do unto you," requires the judge to adopt whichever interpretation of the contract that favours both parties equally. 
E) Given the nature of the parties and the contract,Justice Howe cannot decide that their agreement contains implied terms. 
A) The general rules governing the interpretation of contracts do not apply in the Supreme Court of Canada because that court is expected to arrive at the fairest result regardless of the rules of law. 
B) In order to decide the case,the judge may need to know which party drafted the agreement. 
C) The contextual approach to interpretation requires a particular clause to be interpreted exclusively by reference to its own terms. 
D) The golden rule of interpretation,which says "do unto others as you would have others do unto you," requires the judge to adopt whichever interpretation of the contract that favours both parties equally. 
E) Given the nature of the parties and the contract,Justice Howe cannot decide that their agreement contains implied terms.

Question 19

Jane was at the international terminal of the airport when she realized that she had forgotten to purchase travel insurance for her trip.After checking-in early,Jane was browsing at some of the shops and happened upon a vending machine selling travel insurance.On the outside of the machine was a sign that indicated "Full coverage for $2 per day." Jane plugged in three toonies to cover herself for the weekend.Out from the machine dropped a standard form agreement.After boarding the plane,Jane examined the fine print and noticed that the coverage was limited to travel within Canada.Like every other potential customer in the international terminal of the airport,Jane was not travelling within Canada.Concerned that she would not be covered,as soon as the plane landed Jane used her cellphone to dial the 1-800 number on the back of the printed form.All she got was a recorded message.If Jane got injured while traveling in the United States,will the exclusion clause prevent her from making a successful claim?

Accepted Answer

As the machine represented that the poli

Question 20

Restitution is always possible for any misrepresentation regardless of the circumstances.

Accepted Answer

A) True 
 B)False

When will silence distort a previous assertion?

An exception to the parol evidence rule may arise if

Which of the following statements is TRUE with respect to a contractual clause that protects one party from the consequences of breach (exclusion or limitation of liability clauses)?

Which of the following is NOT an example of a disclosure required by statute?

Damages for actionable misrepresentation are available in the contract law depending on the type of misrepresentation that was made.

Which of the following approaches to contractual interpretation will ONLY SOMETIMES give words their plain,ordinary meaning?

Restitution requires both sides to be returned to their pre-contractual positions.

A standard form business contract requires independent legal advice to the party agreeing to the terms in order to be contractually binding

Parol evidence cannot be used to resolve ambiguous terms of a written contract.

Standard form agreements

Why do insurance contracts require a duty of utmost good faith?

Restitution is always possible for any misrepresentation regardless of the circumstances.

Risk Management and Sources of Law

Litigation and Alternative Dispute Resolution

Introduction to Torts

Intentional Torts

Miscellaneous Torts Affecting Business

Negligence

The Nature and Creation of Contracts

Consideration and Privity

Contractual Defects

Discharge and Breach

Contractual Remedies

Special Contracts: Sale of Goods

Special Contracts: Negotiable Instruments

Real Property: Interests and Leases

Real Property: Sales and Mortgages

Personal Property: Bailment and Insurance

Intellectual Property

Electronic Commerce

Agency and Other Methods of Carrying on Business

Basic Forms of Business Organizations

Legal Rules for Corporate Governance

Secured Transactions

Dealing With Bankruptcy and Insolvency

Government Regulation of Business

Individual Employment

Organized Labour

Filters

Exam 9: Representations and Terms

When will silence distort a previous assertion?

An exception to the parol evidence rule may arise if

Which of the following statements is TRUE with respect to a contractual clause that protects one party from the consequences of breach (exclusion or limitation of liability clauses)?

Which of the following is NOT an example of a disclosure required by statute?

Damages for actionable misrepresentation are available in the contract law depending on the type of misrepresentation that was made.

Which of the following approaches to contractual interpretation will ONLY SOMETIMES give words their plain,ordinary meaning?

Restitution requires both sides to be returned to their pre-contractual positions.

A standard form business contract requires independent legal advice to the party agreeing to the terms in order to be contractually binding

Parol evidence cannot be used to resolve ambiguous terms of a written contract.

Standard form agreements

Why do insurance contracts require a duty of utmost good faith?

Restitution is always possible for any misrepresentation regardless of the circumstances.

Risk Management and Sources of Law

Litigation and Alternative Dispute Resolution

Introduction to Torts

Intentional Torts

Miscellaneous Torts Affecting Business

Negligence

The Nature and Creation of Contracts

Consideration and Privity

Contractual Defects

Discharge and Breach

Contractual Remedies

Special Contracts: Sale of Goods

Special Contracts: Negotiable Instruments

Real Property: Interests and Leases

Real Property: Sales and Mortgages

Personal Property: Bailment and Insurance

Intellectual Property

Electronic Commerce

Agency and Other Methods of Carrying on Business

Basic Forms of Business Organizations

Legal Rules for Corporate Governance

Secured Transactions

Dealing With Bankruptcy and Insolvency

Government Regulation of Business

Individual Employment

Organized Labour

Filters