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Q1: Statement “An unenforceable contract is a valid contract but it will not be enforced by the courts”

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Answer: Correct – True

Q2: Gita gave police information about a jewel thief on Monday. On Tuesday she learns that the owner has offered a reward of £200 for giving information on the thief. Is the owner contractually obliged to pay Gita the reward monies

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Answer: No, because a party cannot accept an offer of which he has no knowledge.

Q3: Where an agreement is made in a social or domestic context what is the general rule relating to intention to create legal relations

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Answer: The courts presume the parties did not intend to create legal relations.

Q4: Business agreements sometimes use ‘honour clauses’. What does an honour clause mean in an agreement

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Answer: The clause means that the agreement is not legally enforceable.

Q5: In which type of agreement is the intention to create legal relations presumed to exist

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Answer: Commercial or business agreements.

Q6: Statement “All contracts with minors are unenforceable in the courts.”

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Answer: Incorrect

Q7: What is meant by executory consideration

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Answer: Where there is a promise to do something in the future.

Q8: Fred finds George’s lost dog. George is so pleased he promises to give Fred £350. George has failed to give Fred the £350 promised. Can Fred enforce the promise

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Answer: No, because the promise to pay was made after the act in returning the dog and past consideration is not good consideration.

Q9: Statement “Consideration must be sufficient. It must have some measurable and material value”

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Answer: Correct – True

Q10: In which case did the court decide that the performance of existing contractual duties can sometimes amount to consideration where the promisor gains some benefit

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Answer: Williams v Roffey Bros and Nicholls (Contractors) Ltd.

Q11: Jens owes JC Builders £5000. On discovering that JC Builders are in financial difficulty Jens offers to pay them £3,000 in full settlement of the debt. JC Builders agree to accept the £3,000 but a week later, claim the remaining £2,000. Will JC Builders succeed in their claim

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Answer: Yes, a promise to accept payment of a smaller sum of money than owed is not enforceable in the above scenario.

Q12: Which Act of Parliament gives persons, who are not one of the parties to a contract, the right to enforce the contract in certain circumstances

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Answer: Contracts (Rights of Third Parties) Act 1999.

Q13: A term may be implied into a contract by:(a) The courts
(b) Statute
(c) Trade custom
(d) A term can never be implied, it must always be expressed by the parties

View Answer

Answer: (a) (b) and (c) only

Q14: What is a pre contractual statement that is not a term of a contract but induces the making of a contract known as

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Answer: A representation

Q15: To which type of contract does the Unfair Terms in Consumer Contracts Regulations 1999apply

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Answer: Contracts for the sale or supply of goods or services where standard terms of business are used and one party is acting in the course of business and the other party acts as a consumer.

Q16: Statement “If a condition in a contract is breached the injured party may treat the whole contract as discharged.”

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Answer: Correct – True

Q17: Where a term of a contract is worded broadly to cover a number of potential breaches and it is not possible to decide whether breach of the term would have important or trivial consequences that term is described as

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Answer: An innominate term.

Q18: Hari is in York for the first time and decides to leave his bag containing his £300 camera at Train Ltd’s left luggage lockers for the day. He places his bag in the locker and after inserting the £10 fee, the door locks and a ticket is issued. The ticket states that Train Ltd are not liable for any loss, damage or theft to items valued over £50 left in lockers. Hari’s locker is broken into by Fred and his camera is stolen Can Hari claim £300 from Train Ltd

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Answer: Yes, because the exemption clause was dispensed after the contract was made.

Q19: Where a person acting in the course of a business includes a term in a contract which excludes liability for death and personal injuries through negligence, the term is

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Answer: Invalid.

Q20: Statement “Under the Unfair Contract Terms Act 1977 the burden of proving an exemption clause is reasonable is on the party seeking to rely on it.”

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Answer: Correct – True

Q21: Statement “If a restraint of trade clause is too wide the courts can change its wording it to make it reasonable.”

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Answer: Incorrect

Q22: What is a solus agreement

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Answer: A contract where one party agrees to buy goods from only one supplier (usually in return for a discount).

Q23: Statement “To be actionable the misrepresentation must be the only reason that persuaded the other party to enter into the contract.”

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Answer: Incorrect

Q24: Misrepresentation in a contract makes the contract

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Answer: Voidable.

Q25: An operative mistake in a contact makes the contract

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Answer: Void.

Q26: What is meant by a common mistake in the law of contract

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Answer: Where both parties make the same mistake.

Q27: George buys a vase from Louis for £20. Louis believes the vase is worthless but George knows it is valuable. George later sells it for £10,000. What legal action can Louis take against George

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Answer: Louis has no legal remedy.

Q28: The possible remedies for negligent misrepresentation are

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Answer: Rescission and damages.

Q29: What does rescission of a contract mean

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Answer: The contract is set aside and the parties are put back in the same position as if the contract had never been entered into.

Q30: When will the courts presume that there has been undue influence is the signing of a contract

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Answer: Where there is a fiduciary relationship with the party against whom the undue influence is alleged.

Q31: Sally contracts with her employer that she will have a salary of £35,000 per annum plus a cash payment of £20,000 at the end of the year which will not be declared thereby avoiding tax. Sally’s employer has now refused to pay her the £20,000. Can Sally take legal action to enforce the payment of £20,000

View Answer

Answer: No, the contract is void for illegality.

Q32: The performance of the contract must be exactly what is promised under the contract in order for the contract to be discharged by performance but there are some exceptions. These are:
(a) Where there has been substantial performance of the contract.
(b) Where the contract is a divisible contract.
(c) Where one party is prevented by the other from completing the contract.
(d) Where partial performance of the contract is accepted by the other party

View Answer

Answer: All these (a) (b), (c) and (d).

Q33: Drugs Ltd contracts with Supermarket Ltd to manufacture and supply 50 cases of a drug called SuperX. Supermarket Ltd pay the contract money, £5,000, to Drugs Ltd but before delivery takes place the Government introduces a law banning the manufacture and supply of SuperX. Can Supermarket Ltd enforce the contract

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Answer: No, the contract is frustrated.

Q34: The consequences of a contract being frustrated are governed by which Act

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Answer: The Law Reform (Frustrated Contracts) Act 1943.

Q35: Where there is an anticipatory breach of contract, when is the injured party first entitled to sue

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Answer: From the date the other party indicates their intention not to complete the contract.

Q36: What is the aim of an award of damages for breach of contract

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Answer: To put the innocent party in the same financial position he would have been in if the contract had been carried out.

Q37: The case of Hadley v Baxendale (1854) laid down

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Answer: Test of remoteness of damages.

Q38: Which one of the following sentences is correct

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Answer: If a party has suffered no loss through a breach of contract he will only be entitled to nominal damages.

Q39: Statement “Specific performance may be awarded if one party fails to carry out his contract of employment.”

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Answer: Incorrect

Q40: Where a contract states the sum to be paid in the event of a breach of contract, the stated sum is known as

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Answer: Liquidated damages.

Q41: Which of the following is a common law remedy

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Answer: Damages.

Q42: Statement “All agents are entitled to be paid for their services.”

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Answer: Incorrect

Q43: An agency relationship which is made retrospectively is know as an agency by

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Answer: Ratification

Q44: X Ltd has two directors, Joe and Harry. Neither of the directors have authority to individually enter contracts on behalf of the company. In practice, Joe (with Harry’s acquiescence) enters into all the contracts on behalf of the company. What type of agency has been created when a third party acting in good faith enters into a contract with Joe who states he is acting on behalf of X Ltd

View Answer

Answer: An agency by estoppel.

Q45: Con appoints George, to act as his agent for two weeks. George agrees to act without payment. Con instructs George to collect rent each Friday morning from his tenants and pay the rent into the bank next door. In the second week, George collects the rent but fails to bank it. On the way home he leaves it on the bus and it is never recovered. Can Con take action against George for breach of his agency duties

View Answer

Answer: Yes, even though George is a gratuitous agent if he does act he must do so in accordance with instructions set out by the principal.

Q46: Prab asked her agent, Hari to purchase her 500 shares in X Ltd. Hari owned 600 shares in X Ltd so without informing Prab where the shares come from he sells his shares to Prab at market value. Is Hari in breach of his agency duties

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Answer: Yes, because he has a duty to avoid a conflict of interest.

Q47: When does apparent (ostensible) authority of an agent arise

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Answer: When the principal represents to a third party that an agent has authority to act when in fact he does not.

Q48: Which one of the following is not a duty of an agent

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Answer: Duty to take a commission.

Q49: Frank enters into a contract with Sally believing that Sally is acting on her own behalf when in fact she is acting as an agent for Derek on his express instructions. In the event of a breach of contract who can Frank take action against

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Answer: Derek or Sally.

Q50: What is an undisclosed agency

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Answer: Where a third party is not informed of the existence of the principal and believes the agent is acting on his own behalf.

Q51: Statement “An agency agreement can always be terminated by a principal.”

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Answer: Incorrect

Q52: Sale of Goods Act 1979 implied various terms into contracts for the sale of goods but what type of goods are not included under the Act

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Answer: Land.

Q53: Statement “The Sale of Goods Act 1979 applies to contracts for the sale of goods where ownership is to be transferred immediately from the seller to the buyer and to contracts where the seller agrees to transfer ownership at a later date.”

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Answer: Correct

Q54: Which one of the following terms is not implied into contracts for the sales of goods in a private sale

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Answer: The goods are of satisfactory quality.

Q55: In a consumer contract goods must be of satisfactory quality except

View Answer

Answer: When the defect is drawn to the attention of the buyer.

Q56: Deepa bought an electric bike from “Great Bikes Ltd” telling the sales assistant that she knew nothing about bikes but wanted a bike suitable for riding on rough terrain. She bought the bike recommended by the assistant, however, although the bike was fine around town, the wheels and frame bent the first time she used it on rough terrain. Her action against “Great Bikes Ltd” would be for breach of which section of the Sale of Goods Act 1979

View Answer

Answer: 14(3)

Q57: Alice enters into a carpet shop and chooses a purple carpet from a sample which is labeled 100% wool. She buys the carpet but the carpet that is delivered is blue and 80% wool. There is a breach of which sections of the Sale of Goods Act 1979

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Answer: Sections 13 and 15

Q58: Statement “Ownership of goods always passes when physical possession passes to the buyer.”

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Answer: Incorrect

Q59: A reservation of title clause is

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Answer: A clause in a contract of sale retaining title of goods until payment has been made.

Q60: Under the Sale of Goods Act the seller has a duty to deliver the goods to the buyer. What is the legal meaning of ‘delivery’

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Answer: The voluntary transfer of possession from one person to another.

Q61: Under the Supply of Goods and Services Act 1982 the term implied into the contract that the supplier will carry out the service with reasonable case and skills is treated as a

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Answer: Innominate term.

Q62: In order to succeed in an action for negligence it is necessary for a claimant to establish whether

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Answer: The defendant owed the claimant a duty of care, breached that duty of care and reasonably foreseeable damage was caused by the breach of duty.

Q63: Statement “In English law it is never possible to recover damages for pure economic loss.”

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Answer: Incorrect

Q64: In claims for psychiatric injury a distinction is made between primary and secondary victims. What is a secondary victim

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Answer: A person who suffers a psychiatric illness as a result of witnessing an accident or its ‘immediate aftermath’.

Q65: Can a rescuer who suffers a psychiatric illness as a result of helping at the scene of an accident be classed as a primary victim

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Answer: Yes, but only if the rescuer was, or reasonably believed himself to be, in danger of physical injury.

Q66: Emily had just passed her driving test when she negligently knocks over a cyclist. What standard of care will Emily be judged by

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Answer: The standard of a competent driver, Emily’s lack of experience will not be taken into account.

Q67: When deciding whether a duty of care has been broken the court will take into account a number of different factors. Which one of the following will the court not take into account

View Answer

Answer: The financial position of the defendant.

Q68: Matt, a hypochondriac, attended the hospital complaining of stomach pains. Dr Julie, who had seen Matt on numerous other occasions refused to see him. Matt died that night. It was discovered he was suffering from poisoning from which there was no antidote. Is Dr Julie liable in negligence

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Answer: No, because there must be a causal link between the breach of duty by the defendant and the damage suffered by the claimant.

Q69: Which one of the following statements about the Consumer Protection Act 1987 is false

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Answer: The Act imposes liability on businesses and private individuals.

Q70: The Consumer Protection Act 1987 places strict liability for defective products on a number of defendants. What does strict liability mean in this context

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Answer: Liability is imposed on a defendant without the claimant having to prove any intention or negligence on the part of the defendant.

Q71: The potential defendants under the Consumer Protection Act 1987 are

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Answer: Producer, own brander, importer from outside the EU, and supplier.

Q72: Which of the following products are not covered under the Consumer Protection Act 1987

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Answer: Buildings.

Q73: Which one of the following property losses is recoverable under the Consumer Protection Act 1987

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Answer: Damage to private property over £275 (but not damage to the product itself or to business property).

Q74: Liability of occupiers to visitors is governed by which Act

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Answer: Occupiers’ Liability Act 1957.

Q75: The standard of care an occupier owes towards a visitor is

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Answer: To take such care, as is reasonable in the circumstances, to see that the visitor will be reasonably safe.

Q76: Under the Occupier’s Liability Act 1984 an occupier’s liability for trespassers extends to

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Answer: Liability for death and personal injury.

Q77: Which of the following is the Rule in Rylands v Fletcher

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Answer: A person who collects and keeps or brings something non natural onto his land, which is likely to do mischief if it escapes, is liable for all the damage which is the natural consequence of its escape.

Q78: Statement “A worker works under a contract for services.”

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Answer: Correct

Q79: The mutuality of obligation test

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Answer: Looks at whether the employer is obliged to provide work for the employee and the employee is obliged to accept it.

Q80: Under the Employment Rights Act 1996 the minimum amount of notice that an employer has to give an employee who has worked for him for two and a half years is

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Answer: 2 weeks.

Q81: What is meant by constructive dismissal

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Answer: Where there is a serious breach of contract by the employer which entitles the employee to treat it as terminated.

Q82: Which of the following is not an automatically unfair dismissal

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Answer: Dismissal taking time off to look after a sick child.

Q83: Statement “There is no difference between the Court of Appeal and the Supreme Court.”

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Answer: Incorrect

Q84: The Service that produces the Code of Practice on Disciplinary and Grievance Procedures is

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Answer: Advisory, Conciliation and Arbitration Service.

Q85: Which one of the following is not a redundancy situation

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Answer: When the workplace is being reorganised.

Q86: What is the name of the main Act that deals with discrimination law

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Answer: Equality Act 2010.

Q87: Which one of the following characteristics is not a protected characteristic under the Equality Act 2010

View Answer

Answer: Single status.

Q88: Which of the following would not be considered discrimination under the Equality Act 2010

View Answer

Answer: John and Mary apply for a job as wardens of sheltered accommodation for the elderly. They are refused the jobs as they are not married.

Q89: What is meant by perceptive discrimination

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Answer: Direct discrimination against someone because they are perceived to have a protected characteristic, although they in fact do not.

Q90: Having a policy or practice which is applied equally to everyone, but which it is more difficult for people of a particular protected characteristic to comply with and which cannot be justified is

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Answer: Indirect discrimination.

Q91: What is meant by associative discrimination

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Answer: Where someone is discriminated against because of another person that he is associated with.

Q92: Under which one of the following Acts is an employer likely to be prosecuted for failing to ensure, so far as is reasonably practicable, the safety and welfare at work of employees

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Answer: Health and Safety at Work Act 1974.

Q93: Statement “Only a local authority has the power to go to court to get an injunction to have a place of business closed down.”

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Answer: Incorrect

Q94: Which one of the following is an unincorporated organisation

View Answer

Answer: General partnership.

Q95: The maximum number of persons who are legally allowed to operate in a partnership is

View Answer

Answer: There is no legal limit

Q96: The Partnership Act 1890 section 24 sets out rights of partners (in default of their own agreement). Which one of the following is not included in section 24

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Answer: The right to a salary.

Q97: Limited liability partnerships were introduced by which Act of Parliament

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Answer: Limited Liability Partnership Act 2000.

Q98: Which one of the following statements about limited liability partnerships (LLPs) is incorrect

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Answer: A limited company can convert to an LLP.

Q99: Which of the following is not a method of creating a company

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Answer: A written agreement made by the directors.

Q100: Sparkle Ltd is a private limited company limited by shares. It has one director. How many shareholders does the law require it to maintain

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Answer: One which can be the same person as the director.