Test: Contract Of Law - 1 - CLAT MCQ

Principle: If a party to the contract offers to fulfill his part of the contract and the other party declines, the first party is freed from his obligations.

Facts: A contracts with B to deliver 100 bales of cotton to him. The scheduled delivery date is 19.10.2014. A rings up on 1.10.2014 and tells him he is bringing the cotton to his house for delivery. B tells him he can’t accept the delivery because he doesn’t have the space to store it. Is A free from his contractual obligations?

Principle: Agreement void where both parties are under mistake as to matter of fact.

Facts: A agrees to sell to B a specific cargo of goods supposed to be on its way from England to Bombay. It turns out that before the day of the bargain the ship conveying the cargo had been cast away and the goods lost. Neither party was aware of these facts.

Principle: When one person signifies to another his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other to such act or abstinence, he is said to make a proposal. The expression of willingness/desire results in a valid proposal only when it is made/addressed to some person (s).  

Facts: ‘X’ makes the following statement in an uninhabited hall. ‘I wish to sell my mobile phone for Rs. 1000.

Principle: A proposal (offer) should be made with an intention that after its valid acceptance, a legally binding promise or agreement will be created. The test for the determination of such intention is not subjective, rather it is objective. The intension of the parties is to be ascertained from the terms of the agreement and the surrounding circumstance under which such an agreement is entered into.    

As a general rule, in the case of arrangements regulating social relations, it follows as a matter of course that the parties do not intend legal consequences to follow. On the contrary, as a general rule, in the case of arrangements regulating business affairs, it follows as a matter of course that the parties intend legal consequences to follow. However, the above rules are just presumptive in nature and hence can be rebutted.

Facts: One morning while having breakfast, ‘X’, the father, says to ‘Y’ (X’s son), in a casual manner, ‘I shall buy a motorbike for you if you get through the CLAT’.

Q. 

Which of the following derivations is correct?  

Principle: Acceptance (of offer) must be communicated by the offeree to the offeror so as to give rise to a binding obligation. The expression ‘by the offeree to the offeror’ includes communication between their authorized agents.

Facts: ‘X’ made an offer to buy Y’s property for a stipulated price. ‘Y’ accepted it and communicated his acceptance to ‘Z’, a stranger.

Principle: Acceptance should be made while the offer is still subsisting. The offeror is free to retract his offer at any time before his offer gets accepted by offeree. Once the offer is withdrawn or is lapsed, it is not open to be accepted so as to give rise to a contract. Similarly, if a time is prescribed within which the offer is to be accepted, then the offer must be accepted within the prescribed time. And if no time is prescribed, then the acceptance must be made within a reasonable time. ‘What is a reasonable time’, is a question of fact which is to be determined by taking into account all the relevant facts and surrounding circumstances. 

Facts: ‘X’ makes an offer to ‘Y’ to sell his equipment for Rs.1000.00. No time is specified for the acceptance. ‘Y’ sends his reply two years after receiving the offer.

Principle: Minor’s agreement is void from the very beginning. It can never be validated. It cannot be enforced in the court of law.
Facts: ‘A’, a boy of 16 yrs of age, agrees to buy a camera from ‘B’, who is a girl of 21yrs of age.

Principle: The consideration of object of an agreement is unlawful if the court regards it as opposed to public policy. Every agreement of which the object or consideration is unlawful is void.

Facts: ‘X’ promises to obtain for ‘Y’ an employment in the public service and ‘Y’ promises to pay Rs. 500000 to ‘X’

Principle: Two or more person are said to consent if they agree upon the same thing in the same sense. Consent is said to be free when it is not caused by coercion, or undue influence, or fraud, or misrepresentation, or mistake.  

When consent to an agreement is caused by coercion, undue influence, fraud or misrepresentation, the agreement is a contract voidable (rescindable or terminable) at the option of the party whose consent was so caused, However, when consent to an agreement is caused by mistake as to a matter of fact essential to the agreement, the agreement is void.

Facts: ‘X’ threatens to gun down ‘Y’, if he (‘Y’) does not sell his property worth Rs. 2000000 for Rs. 100000 only. As a consequence ‘Y’ agrees to sell it as demanded by ‘X’. 

Principles:

a) A minor is a person who is below the age of eighteen. However, where a guardian administers the minor’s property, the age of majority is twenty-one.
b) A minor is not permitted by law to enter into a contract. Hence, where a minor enters into a contract with a major person, the contract is not enforceable. This effectively means that neither the minor nor the other party can make any claim on the basis of the contract.
c) In a contract with a minor, if the other party hands over any money or confers any other benefit on the minor, the same shall not be recoverable from the minor unless the other party was deceived by the minor to hand over money or any other benefit. The other party will have to show that the minor misrepresented her age, he was ignorant about the age of the minor and that he handed over the benefit on the basis of such representation.

Facts:
Animesh convinces Kumud, a girl aged 18 that she would sell her land to him. Kumud’s mother Parineeti is her guardian. Nonetheless Kumud, without the permission of Parineeti, sells the land to Animesh for a total sum of rupees fifty lakh, paid in full and final settlement of the price. Parineeti challenges this transaction claiming the Kumud is a minor and hence the possession of the land shall not be given to Animesh. Thus Animesh is in a difficult situation and has no idea how to recover his money from Kumud.

Q. Why is Parineeti justified in challenging the sale transaction?

Principles:
a) A minor is a person who is below the age of eighteen. However, where a guardian administers the minor’s property, the age of majority is twenty-one.
b) A minor is not permitted by law to enter into a contract. Hence, where a minor enters into a contract with a major person, the contract is not enforceable. This effectively means that neither the minor nor the other party can make any claim on the basis of the contract.
c) In a contract with a minor, if the other party hands over any money or confers any other benefit on the minor, the same shall not be recoverable from the minor unless the other party was deceived by the minor to hand over money or any other benefit. The other party will have to show that the minor misrepresented her age, he was ignorant about the age of the minor and that he handed over the benefit on the basis of such representation.

Facts:
Animesh convinces Kumud, a girl aged 18 that she would sell her land to him. Kumud’s mother Parineeti is her guardian. Nonetheless Kumud, without the permission of Parineeti, sells the land to Animesh for a total sum of rupees fifty lakh, paid in full and final settlement of the price. Parineeti challenges this transaction claiming the Kumud is a minor and hence the possession of the land shall not be given to Animesh. Thus Animesh is in a difficult situation and has no idea how to recover his money from Kumud.

Q. Animesh can be allowed to recover the money only if he can show that:

X gets his bike insured by PQR Insurance Company. X was drunk when he was driving the insured bike. He met with an accident. In the given limited facts to you, choose the correct option?

Which of the options given below correctly defines ‘Act of God’ under the law of torts?

As per the information provided in the passage, who can be termed as a ‘Tortfeasor’?

X is driving an insured bike. Suddenly due to heavy rainfall, X is unable to see a tree ahead. His bike hits the tree and gets badly damaged. In view of the facts given in the question, choose the correct option?

Principles:
a) A minor is a person who is below the age of eighteen. However, where a guardian administers the minor’s property, the age of majority is twenty-one.
b) A minor is not permitted by law to enter into a contract. Hence, where a minor enters into a contract with a major person, the contract is not enforceable. This effectively means that neither the minor nor the other party can make any claim on the basis of the contract.
c) In a contract with a minor, if the other party hands over any money or confers any other benefit on the minor, the same shall not be recoverable from the minor unless the other party was deceived by the minor to hand over money or any other benefit. The other party will have to show that the minor misrepresented her age, he was ignorant about the age of the minor and that he handed over the benefit on the basis of such representation.

Facts:
Animesh convinces Kumud, a girl aged 18 that she would sell her land to him. Kumud’s mother Parineeti is her guardian. Nonetheless Kumud, without the permission of Parineeti, sells the land to Animesh for a total sum of rupees fifty lakh, paid in full and final settlement of the price. Parineeti challenges this transaction claiming the Kumud is a minor and hence the possession of the land shall not be given to Animesh. Thus Animesh is in a difficult situation and has no idea how to recover his money from Kumud.

Q. Which of the following is correct?

Principles:
a) A minor is a person who is below the age of eighteen. However, where a guardian administers the minor’s property, the age of majority is twenty-one.
b) A minor is not permitted by law to enter into a contract. Hence, where a minor enters into a contract with a major person, the contract is not enforceable. This effectively means that neither the minor nor the other party can make any claim on the basis of the contract.
c) In a contract with a minor, if the other party hands over any money or confers any other benefit on the minor, the same shall not be recoverable from the minor unless the other party was deceived by the minor to hand over money or any other benefit. The other party will have to show that the minor misrepresented her age, he was ignorant about the age of the minor and that he handed over the benefit on the basis of such representation.

Facts:
Animesh convinces Kumud, a girl aged 18 that she would sell her land to him. Kumud’s mother Parineeti is her guardian. Nonetheless Kumud, without the permission of Parineeti, sells the land to Animesh for a total sum of rupees fifty lakh, paid in full and final settlement of the price. Parineeti challenges this transaction claiming the Kumud is a minor and hence the possession of the land shall not be given to Animesh. Thus Animesh is in a difficult situation and has no idea how to recover his money from Kumud.

Q. Which of the following is correct?

Mr. A, a Hindu male, has been married to Ms. B, a Hindu female. Their marriage was solemnized as per Hindu rites and ceremonies. After his marriage to Ms. B, Mr. A underwent religious conversion into a religion ‘X’ which legally permits males to have two wives. Thereafter, Mr. A got married to Ms. C, a female belonging to religion ‘X’, in compliance with all the legal requirements of contracting a valid marriage under religion ‘X’. In the given situation, which of the following statements is true?

Mr. A, a Hindu male, has been married to Ms. B, a Hindu female. Their marriage was solemnized as per Hindu rites and ceremonies. After his marriage to Ms. B, Mr. A underwent religious conversion into a religion ‘X’ which legally permits males to have two wives. Thereafter, Mr. A got married to Ms. C, a female belonging to religion ‘X’, in compliance with all the legal requirements of contracting a valid marriage under religion ‘X’. Ms. B filed a criminal complaint against Mr. A for committing the offence of bigamy. In the given situation, which of the following statements is true?

Mr. A, a Hindu male, has been married to Ms. B, a Hindu female. Their marriage was not solemnized as per Hindu rites and ceremonies or any other custom, but was performed by seeking blessings of their family members. After his marriage to Ms. B, Mr. A underwent religious conversion into a religion ‘X’ which legally permits males to have two wives. Thereafter, Mr. A got married to Ms. C, a female belonging to religion ‘X’, in compliance with all the legal requirements of contracting a valid marriage under religion ‘X’. Ms. B filed a criminal complaint against Mr. A for committing the offence of bigamy. In the given situation, which of the following statements is true?

Mr. A, a male belonging to religion ‘P’, has been married to Ms. B, a female belonging to religion ‘P’. Their marriage was solemnized in compliance with all the legal requirements of contracting a valid marriage under religion ‘P’. Monogamy is espoused as a cherished value by the followers of religion ‘P’ and provided as a pre-condition for a valid marriage for the followers of the religion. After his marriage to Ms. B, Mr. A underwent religious conversion into a religion ‘Q’ which legally permits males to have two wives. Thereafter, Mr. A got married to Ms. C, a female belonging to religion ‘Q’, in compliance with all the legal requirements of contracting a valid marriage under religion ‘Q’. Ms. B wife filed a criminal complaint against Mr. A for committing the offence of bigamy. In the given situation, which of the following statements is true?

Which of the following statements is incorrect?

Principles:
(i) An agreement enforceable by law is a contract
(ii) In order for an agreement to be enforceable in a court of law, there must be a meeting of minds b/w both the parties
(iii) Parties to a contract should do something for the other party. The obligation to do something for the other party is mutual. This is called consideration and the absence of consideration renders the contract unenforceable.

Facts: A promised to take B out for a dinner in a restaurant. Even after two weeks, A did not fulfill the promise. B wants to sue A to enforce that promise. If B goes to court:

Principle: If a party consent has been obtained by misrepresentation, the party to whom the misrepresentation has been made may reject the contract.

Facts: J is in need of a house for immediate occupation and hence approaches S, the owner of a house. The house is in a visibly precarious condition and requires a few repairs in order to make it habitable. However, S tells J that the house is good for lodging and J signs the leases agreement with S. J then finds out the actual state of the house and seeks to reject the contract

Mr. A entered into an agreement to sell his bicycle which had been kept unused in his attic for a year, to Mr. B, at an agreed price. However, neither party was aware that at the time of entering into the agreement, the bicycle had already been destroyed by a fire in the attic. In the given situation, which of the following statements is true?

Ms. X and Ms. Y entered into a contract of sale of an article, while reeling under the erroneous belief that the sale of the article, which was the subject-matter of the agreement, was permitted by the law in force in India. In the given situation, which of the following statements is true?

Mr. J entered into an agreement with Mr. K for the sale of Mr. J’s ‘club’. At the time of entering into the agreement, while Mr. J believed that he was agreeing to sell his golf club, Mr. K believed that he was agreeing to buy a clubhouse owned by Mr. J. The agreement is void because: