Deck 4: Indian Contract Act

Question 1

An agreement, which prevents a person from carrying lawful business is

A)Valid
B)Void
C)Voidable
D)Contingent

Answer 1

Void

Question 2

An agreement in restraint of legal proceedings is void. It does not cover an agreement which

A)Restrict absolutely the parties from enforcing their legal rights.
B)Cuts short the period of limitation
C)Discharges a party from liability or extinguishes the rights of a party
D)Provides for a reference to arbitration instead of court of law

Answer 2

Provides for a reference to arbitration instead of court of law

Question 3

A agrees to sell his car to B at a price which B may be able to pay. This agreement is

A)Void
B)Valid
C)Voidable
D)Contingent

Answer 3

Void

Question 4

An agreement to pay money money's worth on the happening or non happening of a specified uncertain event is a

A)Wagering agreement
B)Contingent contract
C)Quasi contract
D)Uncertain agreement

Question 5

An agreement to do an illegal act(eg: sharing the earnings of smuggling business) is

A)Valid
B)Void
C)Voidable
D)Contingent

Question 6

Where an agreement consists of two parts once legal and the other illegal and the legal part is separable from the illegal one, such legal part is

A)Void
B)Valid
C)Voidable
D)Illegal

Question 7

A contingent contract dependent on the non happening of a future uncertain event becomes void when such event

A)Happens
B)Does not become impossible
C)Does not happen
D)Both (a) and (b)

Question 8

A agrees to pay Rs.1000 to B if a certain ship returns within a year. However, the ship sinks within the year. In this case, the contract becomes

A)Valid
B)Void
C)Voidable
D)Illegal

Question 9

A contingent contract dependent on the non happening of specified uncertain event within fixed time can be enforced if the event

A)Does not happen within fixed time
B)Becomes impossible before the expiry of fixed time
C)Happens within the fixed time
D)Both (a) and (b)

Question 10

The basis of 'quasi contractual relations' is the

A)Existence of a valid contract between the parties
B)Prevention of unjust enrichment at the expense of others
C)Provision contained in section 10 of the Contract Act
D)Existence of a voidable contract between the parties

Question 11

Sometimes, a person finds certain goods belonging to some persons. In such case, the finder

A)Becomes the owner of the goods and can use them
B)Is under a duty to trace the true owner and return the goods
C)Can sell the perishable goods if true owner cannot be found
D)Both (b) and (c)

Question 12

A, B and C jointly promised to pay Rs.60000 to D. A was compelled by D to pay the entire amount of Rs.60000. Here

A)A can file a suit against D for recovery of the amount exceeding his share
B)A is entitled to recover Rs.20000 each from B and C
C)On payment by A, the contract is discharged and B and C are also not liable to A.
D)D is not justified here and is liable to refund the entire amount to A

Question 13

In commercial transactions, time is considered to be of the essence of contract, and if the party fails to perform the contract within specified time, the contract becomes

A)Voidable at the option of the other party
B)Void and cannot be enforced
C)Illegal for non compliance of legal terms
D)Enforceable in higher court only

Question 14

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 category of

A)Mutual and Concurrent
B)Conditional and dependent
C)Mutual and independent
D)Both (a) and (b)

Question 15

When after the formation of a valid contract, an event happens which makes the performance of contract impossible then the contract becomes

A)Void
B)Voidable
C)Valid
D)Illegal

Question 16

A party entitled to rescind contract, losses the remedy where

A)He has ratified the contract
B)Third party has acquired right in good faith
C)Contract is not separable and recession is sought of a party only
D)All of these

Question 17

The special damages ie, the damages which arise due to so a special or unusual circumstances

A)Are not recoverable altogether
B)Are illegal being punitive in nature
C)Cannot be claimed as a matter of right
D)Can be claimed as a matter of right

Question 18

Which of the following statements is correct?

A)Ordinary damages are recoverable
B)Special damage is recoverable only if the parties knew about them
C)Remote or indirect damages are not recoverable
D)All of these

Question 19

When offer is made to a definite person, it is known as

A)General offer
B)Cross offer
C)Counter offer
D)Special offer

Question 20

Standing offer means

A)Offer allowed to remain open for acceptance over a period of times
B)Offer made to the public in general
C)When the offeree offers to qualified acceptance of the offer
D)Offer made to a definite person

Question 21

When the offeree offers to qualified acceptance of the offer subject to modifications and variations he is said to have made a

A)Standing, open or continuing offer
B)Counter offer
C)Cross offer
D)Special offer

Question 22

What is legal terminology for the doing or not doing of something which the promisor desires to be done or not done?

A)Desires
B)Wishes
C)Considerations
D)Promise

Question 23

Can a person who is usually of unsound, but occasionally of sound mind, make a contract?

A)Yes, he can always make a contract
B)Yes, but only when he is sound mind
C)No, he cannot make contract
D)Can't be determined

Question 24

A and B both believe that a particular kind of rice is being sold in the market@Rs.3000 per quintel and A sells rice of that kind to B @3000/quintel. But in fact, the market price was Rs.4000, the contract is

A)Valid
B)Void
C)Voidable
D)Illegal

Question 25

A sells the goodwill of his business to B and agrees with him to refrain from carrying on a similar business within specified local limits. This contract is

A)Valid
B)Void
C)Voidable
D)Illegal