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X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.
Q.If X knew the goods were destroyed by fire at the time of agreement
- a)Void on the ground of X’s mistake
- b)Voidable
- c)Void but X should compensate the buyer for any loss that it sustains through nonperformance
- d)Void on the ground of supervening impossibility
Correct answer is option 'C'. Can you explain this answer?
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X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to ...
Legal Position: Void but X should compensate the buyer for any loss that it sustains through nonperformance.
Explanation:
- When X agreed to sell 1000 bales of cotton at Rs. 999/bale and deliver them within a fortnight, it created a valid contract between X and the buyer.
- However, if X knew at the time of the agreement that the goods were destroyed by fire, the contract becomes void on the ground of X's mistake.
- Mistake refers to a belief that is not in accordance with the facts, and if X was mistaken about the existence of the goods, the contract becomes void.
- In this case, X's mistake about the availability of the goods makes the contract void, meaning it is treated as if it never existed.
- However, even though the contract is void, X is still liable to compensate the buyer for any loss that it sustains through nonperformance.
- X's failure to deliver the goods as agreed has caused a loss to the buyer, and X should be held responsible for compensating the buyer for this loss.
- The compensation should be equivalent to the loss suffered by the buyer due to X's nonperformance.
Explanation:
- When X agreed to sell 1000 bales of cotton at Rs. 999/bale and deliver them within a fortnight, it created a valid contract between X and the buyer.
- However, if X knew at the time of the agreement that the goods were destroyed by fire, the contract becomes void on the ground of X's mistake.
- Mistake refers to a belief that is not in accordance with the facts, and if X was mistaken about the existence of the goods, the contract becomes void.
- In this case, X's mistake about the availability of the goods makes the contract void, meaning it is treated as if it never existed.
- However, even though the contract is void, X is still liable to compensate the buyer for any loss that it sustains through nonperformance.
- X's failure to deliver the goods as agreed has caused a loss to the buyer, and X should be held responsible for compensating the buyer for this loss.
- The compensation should be equivalent to the loss suffered by the buyer due to X's nonperformance.
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X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer?
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X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer?.
X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X of Mumbai agreed to sell 1000 bales of cotton @ Rs. 999/bale and to deliver within a fortnight at buyers godown at Karachi. X failed to supply these goods. State the legal position in each case with explanation.Q.If X knew the goods were destroyed by fire at the time of agreementa)Void on the ground of Xs mistakeb)Voidablec)Void but X should compensate the buyer for any loss that it sustains through nonperformanced)Void on the ground of supervening impossibilityCorrect answer is option 'C'. Can you explain this answer?.
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