📚 Contract Act Test 2 | Fully Solved
Preparation for RJS, DJS, PCS(J) and other Judicial Service exams. The Contract Act forms the bedrock of civil law. Its thorough knowledge is a must for all aspirants. Delhi Law Academy Jaipur presents below fully solved test questions.
📝 Questions & Answers
Q18: Which one of the legal propositions is correct?
- It is necessary for a contract to be valid that the consideration should be adequate.
- An agreement made on account of natural love and affection, without consideration, is void.
- Inadequacy of consideration renders the contract void ab initio.
- Inadequacy of consideration does not affect the validity of the agreement.
Ans: d
Q19: An agreement to keep the offer open for a certain period of time cannot be cancelled before the expiry of that time period if
- It has sufficient consideration
- It is made with lawful objective
- It has been accepted with a condition subsequent
- It is provisionally accepted
Ans: a
Q20: A tells B that he will pay him Rs. 1,000 when he turns 30. Is this a contingent contract?
- No, B definitely will turn 30. There is no possibility of the event not happening. This is not a contingent contract.
- Yes, the payment is contingent upon the occurrence of an event
- Yes, when B turns 30, a will pay him Rs. 1000
- No, there is no consideration
Ans: b
Q21: If the time is not the essence of the contract, the failure to perform the contract by the specified time makes the contract…
- Void
- Remains valid and can be performed at any subsequent time without the promisor being liable for the loss suffered by the promisee
- Voidable at the instance of the promisee
- Remains valid but the promisee can claim compensation for the loss suffered by him by such failure
Ans: d
Q22: Which of the following statement is correct in the Indian context?
- Consideration can only be present
- Consideration can only be present and future
- Consideration can be past, present and future
- Past consideration is no consideration
Ans: c
Q23: Section 73 of the Indian contract act incorporates rules from which of the following cases?
- East Ham B.C. v. Bernard Sunley & sons ltd
- Shearson Lehman Button Inc. v. Maclaine Watson & co ltd.
- Fish v. Kempton
- Hadley v. Baxendale
Ans: d
Q24: Accord and satisfaction are terms related to
- Performance of contract
- Contingent contracts
- Impossibility of performance of contract
- Breach of contract
Ans: a
NOTE: An accord and satisfaction example is when a contract is fulfilled using different terms than what was originally agreed upon, but still considered settled. Accord = agreement, Satisfaction = fulfillment. Essentially, accord and satisfaction is a contract within a contract.
Q25: A orders a pizza from dominos. The dominos delivery person accidentally delivers it to C. C eats it. Is C obliged to pay dominos for the pizza?
- No, the mistake was made by the pizza delivery man
- No, C didn’t make any mistake
- Yes. C ate the pizza knowing that he hadn’t ordered it. Having derived the benefit of the contract, he must now pay for it.
- Yes. C stole the pizza
Ans: c
Q26: An acceptance can be revoked
- neither at any time before the communication of acceptance is complete as against the promisee nor after its acceptance comes to the knowledge of the promisor
- after its acceptance comes to the knowledge of the promisor
- at any time before the communication of acceptance is complete as against the promisee
- either at any time before the communication of acceptance is complete as against the promisee or after its acceptance comes to the knowledge of the promisor
Ans: c
Q27: Insurance covers and railway carriage receipts are examples of
- Standard form contracts
- Counter proposals
- Letter of intent
- Provisional contracts
Ans: a
NOTE: Standard Form Contracts are agreements with standardized, non-negotiable provisions, usually preprinted. One party sets terms; the other has little to no negotiation power.
Q28: In the Indian context an agreement in restraint of trade is valid if it relates to
- Sale of goodwill
- Mutual adjustment
- Business contingency
- None of the choices
Ans: a
Q29: Where the proposal and acceptance is through letters, the contract is made
- at the place at which the acceptance is addressed
- at the place where the acceptance is received
- all these choices
- at the place where the letter of acceptance is posted
Ans: a
Q30: A clause in a loan agreement permitting the financier to seize the financed vehicle in the event of default in payment would amount to
- Voidable agreement due to fraud
- Unlawful agreement due to coercion
- Void agreement due to unequal bargaining power
- Void agreement due to mistake
Ans: c
Q31: A contract with or by a minor is a
- Voidable contract
- Void contract
- Valid contract
- Voidable at the option of either party
Ans: b
Q32: Surety has the following rights against the creditor…
- (i) Right to securities
- (ii) Right to share reduction
- (iii) Right of set off
- (iv) Right of subrogation
- (i), (iii) and (iv)
- None of the choices
- (i), (ii) and (iii)
- All of the choices
Ans: c
Q33: The damages under section 73 of Indian contract act are
- Penal
- Liquidated
- Compensatory
- None of the choices
Ans: c
NOTE: When a contract has been broken, the party suffering is entitled to compensation for any loss caused by the breach.
Q34: The term consensus ad-idem means
- Reaching an agreement
- Meeting of minds upon the same thing in the same sense
- General consensus
- All of the above
Ans: b
Q35: ‘A’ contracts with B to pay him a large sum of money when he marries C. B married D instead. He now asks for the money. Is the contract now void?
- The contract is valid and enforceable now as it depends on B marrying and not who he marries
- The contract is void as it restrains B’s choice in marriage
- The contract is still valid as B may still marry C at some point in future, and would then become eligible for money
- The contract is void as B has married someone else
Ans: d
NOTE: Section 32: Contingent contracts to do or not to do anything if an uncertain future event happens: If the event becomes impossible, such contracts become void.
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📘 FAQs on Contract Act
The contract is voidable on the ground of fraud ✅.
Past consideration is valid only in Indian Law and not in English Law ✅.
Yes, since the provisions supplied constituted necessaries, the supplier can recover the money ✅.
On equal footing ✅.
No, such an agreement is void as it is in restraint of trade ✅.
The case is Kedar Nath v. Gorie Mohd ✅.