1. Where reciprocal promises are to be performed simultaneously:
A) Either may refuse unless the other is ready and willing
B) Both must perform regardless of readiness
C) Promisee must perform first
D) Contract becomes voidable
B) Both must perform regardless of readiness
C) Promisee must perform first
D) Contract becomes voidable
Answer: A
Explanation: Section 51 states readiness and willingness is a precondition where promises are simultaneous.
Explanation: Section 51 states readiness and willingness is a precondition where promises are simultaneous.
2. If a debtor owes several debts and omits to intimate appropriation:
A) Creditor must apply payment to earliest debt
B) Creditor may apply at his discretion
C) Payment must go to secured debt
D) Payment extinguishes all debts proportionately
B) Creditor may apply at his discretion
C) Payment must go to secured debt
D) Payment extinguishes all debts proportionately
Answer: B
Explanation: Under Section 60, if the debtor does not specify, the creditor may appropriate at discretion.
Explanation: Under Section 60, if the debtor does not specify, the creditor may appropriate at discretion.
3. A party who partly performed a contract that becomes void may claim:
A) Nothing
B) Damages for the entire contract
C) Quantum meruit for work done
D) Specific performance
B) Damages for the entire contract
C) Quantum meruit for work done
D) Specific performance
Answer: C
Explanation: Section 65 allows restitution; quantum meruit compensates for benefit conferred.
Explanation: Section 65 allows restitution; quantum meruit compensates for benefit conferred.
4. An agreement to not carry any business anywhere in India for 3 years is:
A) Valid if consideration is adequate
B) Void being restraint of trade
C) Valid if restraint is reasonable
D) Voidable at the option of promisee
B) Void being restraint of trade
C) Valid if restraint is reasonable
D) Voidable at the option of promisee
Answer: B
Explanation: Section 27 declares such restraint void except for sale of goodwill with reasonable limits.
Explanation: Section 27 declares such restraint void except for sale of goodwill with reasonable limits.
5. Ratification relates back to:
A) Date of ratification
B) Date of act ratified
C) Date of communication
D) Notional date fixed by principal
B) Date of act ratified
C) Date of communication
D) Notional date fixed by principal
Answer: B
Explanation: Ratification relates back to the date of the act if the principal was competent.
Explanation: Ratification relates back to the date of the act if the principal was competent.
6. If the promisee does not rescind on anticipatory breach:
A) Contract is discharged immediately
B) Promisee must sue at once
C) Promisee keeps the contract alive, risk of events falling on him
D) Promisee loses right to sue
B) Promisee must sue at once
C) Promisee keeps the contract alive, risk of events falling on him
D) Promisee loses right to sue
Answer: C
Explanation: Keeping the contract alive exposes the promisee to subsequent discharge by impossibility.
Explanation: Keeping the contract alive exposes the promisee to subsequent discharge by impossibility.
7. Wagering agreements are void but not illegal except:
A) In Gujarat
B) In Maharashtra
C) In Goa
D) In Karnataka
B) In Maharashtra
C) In Goa
D) In Karnataka
Answer: A
Explanation: In Gujarat (and old Bombay), wagers are illegal, affecting collateral agreements.
Explanation: In Gujarat (and old Bombay), wagers are illegal, affecting collateral agreements.
8. Which is unlawful under Section 23?
A) Agreement to sell property of enemy in wartime
B) Agreement to sell lottery tickets authorised by the government
C) Promise to pay for lawful object without licence
D) Promise to lend money for legal business
B) Agreement to sell lottery tickets authorised by the government
C) Promise to pay for lawful object without licence
D) Promise to lend money for legal business
Answer: A
Explanation: Dealing with enemy property is opposed to public policy.
Explanation: Dealing with enemy property is opposed to public policy.
9. Acceptance by telephone is complete when:
A) Words are spoken
B) Call is connected
C) Proposer hears and understands
D) Message is left on voicemail
B) Call is connected
C) Proposer hears and understands
D) Message is left on voicemail
Answer: C
Explanation: For instantaneous modes, acceptance is complete when heard and understood.
Explanation: For instantaneous modes, acceptance is complete when heard and understood.
10. A contract required by law to be in writing but made orally is:
A) Void
B) Illegal
C) Unenforceable
D) Valid
B) Illegal
C) Unenforceable
D) Valid
Answer: C
Explanation: Valid in substance but unenforceable for lack of statutory form.
Explanation: Valid in substance but unenforceable for lack of statutory form.
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Ruchika Mohapatra
Contributing author
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