Practice Paper on Void Agreements for CLAT 2020

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Multiple Choice Questions  ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​​​ Q1.​​ Principle: Sale of liquor is illegal. All agreements relating to prohibited items do not exist in the eyes of law.​​ Facts:​​ ​​ A entered into an agreement with B for the sale of liquor.​​ A failed to supply the agreed quantity of liquor to B.​​ (A) B can bring a legal action against A.​​ (B) B cannot bring any legal action against A.​​ (C) A can bring a legal action against B.​​ (D) A and B can initiate appropriate legal proceeding against each other.​​  ​​ ​​​​  ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​​​ [CLAT 2019]​​  ​​​​ ​​  Q2. Principle:​​ An agreement with a boy below the age of eighteen years is not enforceable by law.​​ Facts: A man entered into an agreement with a girl of seventeen years of age.​​ (A) The agreement is enforceable by law.​​ (B) The agreement is not enforceable by law.​​ (C) The agreement is enforceable by the girl.​​ (D) No inference can be drawn.​​ ​​       ​​  ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​ ​​​​ [CLAT 2019]​​ ​​ ​​  Q3.​​ Principle: Law never enforces an impossible promise.​​ Facts: A made a promise to​​ B to discover treasure by magic.​​ (A) Law will enforce the promise.​​ (B) Law will not enforce the promise.​​ (C) Law will enforce the promise only at the option of A.​​ (D) Law will enforce the promise only at the option of B.​​  ​​​​  ​​​​     [CLAT 2019]​​  Q4.​​ Legal Principle: An agreement entered into by way of a wager/bet is unenforceable in law.Fact Situation: Thomas is very good at predicting outcomes of cricket matches. Raja and Hoja give him​​ rupees thousand each to enable him to bet with others about the outcome of a cricket match. Thomas​​ wins rupees three lakh after betting three thousand rupees.Which of the following statements is the most appropriate in relation to the legal principle stated above?(A)​​ ​​ Thomas must share rupees three lakh with Raja and Hoja equally.(B)​​ ​​ Thomas must return rupees thousand each to Raja and Hoja.(C)​​ Thomas need not share the three lakh with Raja and Hoja since it is the outcome of an unenforceable​​ agreement.(D) If Thomas does not pay them rupees two lakh each, Raja and Hoja can sue him to recover their share.​​  ​​ ​​​​ ​​ ​​  ​​​​           [CLAT 2018] Q5.​​ Legal Principle: Agreements in restraint of trade are void and unenforceable.Fact Situation: Manu has been working as a blacksmith in his village for many decades. Somu has been​​ undergoing training with him for the past three years. After his training is over, Somu enters into an​​ agreement with Manu that he will not start a competing business in the same village while Manu is alive.Which of the following statements is the most appropriate in relation to the legal principle stated above?(A) This agreement is void and unenforceable since it is a restraint on trade.(B) This agreement is valid and enforceable since Manu is Somu’s teacher.(C) This agreement is valid but not enforceable after Manu’s death.(D) This agreement is valid and enforceable since it is to protect Manu’s interest in consideration forteaching Somu to be a blacksmith. ​​​​ ​​  ​​​​  ​​​​        [CLAT 2018]​​  ​​​​ ​​  Q6.​​ Principle: Every agreement, of which the object or consideration is opposed to​​ public policy, is void. An agreement which has the tendency to injure public interest or​​ public welfare is one against public policy. What constitutes an injury to public interest​​ or public welfare would depend upon the times and the circumstances.Facts: ‘A’ promises to obtain for ‘B’ an employment in the public service, and ‘B’​​ promises to pay rupees 5,00,000/- to ‘A’.​​ ​​ Apply the above principle to the given facts and choose the correct option below: ​​ (A)​​ The agreement is void, as the object and consideration for it is opposed to public​​ policy.(B)​​ The agreement is void because rupees 5,00,000/- is excessive.(C)​​ The agreement is valid, as it is with consideration for public service.(D)​​ The agreement is valid, as it is a contract between two parties with their free​​ consent. ​​ ​​​​    ​​         [CLAT 2017] Q7.​​ Principle: An agreement, the terms of which are not certain, or capable of being​​ made certain, is void.Facts: Sunder agreed to take Bhola’s penthouse on rent for three years at the rate of​​ rupees 12,00, 000/- per​​ annum provided the house was put to thorough repairs and the​​ living rooms were decorated according to contemporary style.(A)​​ There is a valid contract because there is an offer from Sunder and acceptance​​ from Bhola.(B)​​ There is a valid contract because all the terms of contract are certain and not​​ vague as the rent is fixed by both of them and the term ‘present style’ only can be​​ interpreted to mean the latest style.(C)​​ There is no valid contract because it has vague and uncertain terms, as the term​​ ‘present style’ may mean one thing to Sunder and another to Bhola.(D)​​ It is voidable contract at the option of Bhola. ​​​​  ​​​​  ​​ ​​​​  ​​​​ ​​ ​​  ​​ ​​ ​​​​     [CLAT 2017]​​ ​​  Q8.​​ Principle: An agreement in restraint of trade​​ is​​ void and not enforceable.​​ An agreement whose terms are not certain is void. ​​ Facts:​​ A and B carry the same business in the same locality in Calcutta.​​ B agrees to pay​​ "some​​ money"​​ to A if A closes​​ his business in that locality. On complying with that condition, A files a suit against B​​ claiming Rs. 50,000​​ from B​​ for closing down his business.​​ (A)​​ A can claim Rs. 50,000 from B.​​ (B) A can​​ claim something but​​ not Rs. 50,000​​ from B​​ as it is excessive.​​ (C) A cannot claim anything from B since the agreement was void due to being uncertain as well as in restraint of trade.​​ (D) None of the above ​​  Q9.​​ Principle : Wagering agreements are void. Collateral agreements to wagering contracts are valid.Facts: XYZ Bank lends Rs. 40,000 to Sabu in order to enable him to award as prize to Randeep who is the winner of horse race. Later Sabu refused to pay the prize stating that horse racing is wagering agreement. Can XYZ Bank recover money from Sabu.(A)​​ Yes it is only a collateral agreement to horse racing and therefore the bank can recover the​​ money from Sabu.(B)​​ Horse racing is illegal and therefore XYZ Bank cannot recover anything from Sabu.(C)​​ No, as it is as wagering contract.(D)​​ Bank can recover money from Sabu so that payment of prize money can be made to​​ Randeep. ​​ ​​​​            [CLAT 2016]​​  Q10.​​ Principle:​​ An agreement, the terms of which are not certain, or capable of being​​ made certain, is void.Facts:​​ A horse was bought for a certain price coupled with a promise to pay Rs. 500 more if the horse proved lucky.​​ (A)​​ This is a valid agreement.​​ (B)​​ This agreement is void due to uncertainty as it cannot be determined whether the horse brought good or bad luck to the buyer. ​​ (C)​​ The agreement is partially​​ void and partially valid.​​ (D)​​ None of the above​​          [CLAT 2015] ​​  ​​​​   Answer Key with explanationsQuestion 1 -​​ Option (B) is the correct answer.​​ Explanation -​​ As per the given principle, the agreement between A and B is void hence no action can be brought against A.​​  Option 2 - Option (D) is the correct answer.​​ Explanation -​​ The given principle only talks about a boy aged below 18 years while the given facts refer to a girl aged 17 years so the given principle cannot be applied to the given facts to arrive at a correct answer. Hence, option (D) is correct.​​  Question 3 -​​ Option (B) is the correct answer.​​ Explanation - The​​ performance of​​ promise made by A to B is impossible so it will not be enforced under law.​​  Question 4 -​​ Option (C) is the correct answer.​​ Explanation - As per the given principle,​​ option (C) is correct and nothing can be claimed from Thomas by anyone.​​  Question 5 -​​ Option (A) is the correct answer.Explanation - As per the given legal principle, the agreement between Somu and Manu is void​​ as it restrains Somu from carrying on business.​​  Question 6 -​​ Option (A) is the correct answer.​​ Explanation -​​ Appointments in public service must be done only on basis of merit and not on basis of extraneous considerations such as payment of money. Hence, the consideration involved is opposed to public policy due to which the agreement between ​​ A and B is void.  ​​​​  Question 7 -​​ Option (C) is the correct answer.​​ Explanation -​​ The terms of the contract between Sunder and Bhola are uncertain due to which it is not valid. ​​  ​​​​ ​​  Question 8 -​​ Option (C) is the correct answer.Explanation -​​ The agreement between A and B not only restrained A from carrying on business, it was also unclear in respect of the amount payable by B to A due to which option (C) is correct.​​  Question 9 -​​ Option (A) is the correct answer.​​ Explanation -​​ The lending of money by XYZ bank to Sabu was only collateral to the wagering agreement hence the bank can recover it from Sabu.​​  Question 10 -​​ Option (B) is the correct answer.​​ Explanation -​​ The terms of the agreement are void due to the reason given in option (B) itself. ​​ ​​  ​​​​ ​​ ​​  ​​ ​​ ​​​​  ​​ ​​​​  ​​​​  ​​​​  ​​ ​​ ​​ ​​​​ ​​  ​​ ​​​​ ​​ ​​   ​​​​  ​​​​ ​​   (function( $ ) { //footnotes $('.defaultNote').children(":first").css('cursor', 'pointer'); $('.defaultNote').children(":first").click(function(){ var gotoID = '#' + $(this).parent().attr('id'); $('html, body').animate( { scrollTop: $('a[href="' + gotoID + '"]').offset().top - 60, }, 250, 'linear' ) }); }(jQuery)); var numFormat = ",."; (function( $ ) { "use strict"; //do some cleaning on load var sortCells = $('td[data-sorting], th[data-sorting]'); sortCells.each(function(){ var first = $(this).text().trim().charAt(0); if (first == '@'){ var oldHTML = $(this).html(); var newHTML = oldHTML.replace('@', ''); $(this).html(newHTML); } }); function sortingTable(node, pos, ordBy){ var rows = node.children('tbody').children('tr').get(); rows.sort(function(a, b) { var X = $(a).children('td').eq(pos).text().toUpperCase(); var Y = $(b).children('td').eq(pos).text().toUpperCase(); if (numFormat != '.,'){ //we are dealing with a different locale and we need to do some //transformation in numbers X = convert2number(X); Y = convert2number(Y); } else { X = X.replace(/,/g, '').replace(/ /g, ''); Y = Y.replace(/,/g, '').replace(/ /g, ''); } var currencies = ['$', '¥', '£', '€']; var arrayLength = currencies.length; var XX = X; var YY = Y; for (var i = 0; i < arrayLength; i++) { XX = XX.replace(currencies[i], ''); YY = YY.replace(currencies[i], ''); } if (!isNaN(XX) && !isNaN(YY)){ var floatXX = parseFloat(XX); var floatYY = parseFloat(YY); return -(floatYY-floatXX) * ordBy; } else if (!isNaN(XX) && isNaN(YY)){ return -1 * ordBy; } else if (isNaN(XX) && !isNaN(YY)){ return ordBy; } else { if(X < Y) { return -1 * ordBy; } if(X > Y) { return 1 * ordBy; } return 0; } }); $.each(rows, function(index, row) { node.children('tbody').append(row); }); } function removeTableCellDecoration() { $("td[data-sorting], th[data-sorting]").removeClass('sortDecorator'); } //unbind the click event just in case we are loading more than one document $("td[data-sorting], th[data-sorting]").off('click'); $("td[data-sorting], th[data-sorting]").click(function(){ removeTableCellDecoration(); $(this).addClass('sortDecorator'); //get desired ordering var ordering = $(this).attr('data-sortOrdering'); if (ordering == 'ASC'){ var ordBy = -1; $(this).attr('data-sortOrdering', 'DESC'); } else { var ordBy = 1; $(this).attr('data-sortOrdering', 'ASC'); } var cellPosition = $(this).prevAll().length; var table = $(this).parents('table:first'); sortingTable(table, cellPosition, ordBy); }); function convert2number(str) { str = str.trim(); if (str.match(/^\d+/)) { //we have to take special care when the thousand separators are '.' var result_0 = str.replace(/\./g, '_@_'); var result_1 = result_0.replace(window.numFormat[0], '.'); var result = result_1.replace(/_@_/g, ''); result .replace(/ /g, ''); return result; } else { return str; } } }(jQuery));