Contract Law Practice Test

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• In a battle of forms between two businesses, how would the courts determine whether a contract exists and which terms govern it?
• Under the doctrine of privity, who has the right to sue on a contract?
• In contract law, which party can sue as an intended beneficiary?
• Which group may lack capacity to contract?
• Which of the following is NOT a remedy for lack of capacity?
• Which of the following is NOT an element of fraudulent misrepresentation?
• Can an exclusion clause excluding all liability for breach of implied terms be enforced under the CRA if it is in tiny print and not transparent?
• A builder contracted to build a house for a newly married couple. The terms provided the builder would receive the contract price when the building was fully completed. Just before completion, a storm demolished the building. What is the builder entitled to recover from the couple?
• Two parties enter into a contract under which one agrees to supply a quantity of timber to the other. In breach of contract, the supplier does not provide the timber despite payment having been received. The other party sues the supplier for damages for breach of contract. What is the aim of damages for breach of contract?
• An antiques dealer and a customer contract for a painting based on both parties believing it to be of unknown origin; the painting is later found to have a valuable signature. The contract is:
• Which statement best describes restitution?
• What is the essential criterion for frustration to discharge a contract?
• Which type of misrepresentation typically allows greater damages?
• Which option correctly describes restitution damages?
• What describes breach and discharge by performance?
• Acceptance of an offer is generally effective when it is communicated to the offeror. Which option best reflects this rule?
• Which of the following vitiating factors renders a contract void, based on the provided material?
• What best describes an innominate term in contract law?
• Which statement best describes the difference between intended beneficiaries and incidental beneficiaries in terms of enforcement rights?
• A price quotation from a supplier is generally considered to be which of the following?
• Why is specific performance typically unavailable for personal services contracts?
• What is the main principle regarding intention to create legal relations in commercial versus domestic agreements?
• A gallery owner enters into a contract to sell a painting to an art enthusiast with payment on delivery two weeks later. The gallery owner then sells the painting to another gallery for more money. What is the effect of the gallery owner's actions on the contract with the art enthusiast?
• A painting believed to be an old master by two parties is later found to be a modern reproduction. Is the contract void for mistake?
• A car manufacturer contracted with a machinery supplier for repair of a vital piece of machinery. The supplier was two months late in returning the repaired equipment. Industry practice required the manufacturer to keep a spare, which it did not. The manufacturer sues for loss of profits during the downtime. Will the manufacturer likely succeed in its loss of profit claim?
• Which remedy is available for contracts entered into by persons who lack capacity, such as minors or those with mental incapacity?
• A carer and an elderly person form a contract after the carer manipulates the elderly person to transfer funds to a charity benefiting the carer. What is the effect on the contract?
• In March, a homeowner contracted with a buyer to sell his house for £280,000, with the purchase price due on 1 July. On 1 May, the buyer wrote that she has had second thoughts and won’t pay unless the homeowner repaints the house and fixes the garden. If the homeowner wishes to treat the contract as breached, which is true?
• Which statement describes innocent misrepresentation and its typical remedy?
• Which statement about the parol evidence rule is correct?
• A paper manufacturer offers to sell 100 reams of copier paper at £10 per ream, with a term that acceptance must be emailed by 5pm on the day the offer is made. The purchasing manager leaves a voicemail before 5pm accepting the offer. Is there a binding contract?
• After a breach, the usual remedy is damages. In a case where the buyer seeks to recover for a dress breach, which amount best represents the appropriate damages?
• Which concept allows a person who was previously without capacity to be bound by a contract after gaining capacity?
• Which of the following groups may lack capacity to contract?
• In a contract for the hire of a ship, the seaworthiness term is unclear as to whether it is a condition or an innominate term. If the breach occurs and the vessel has benefited the customer for most of the term, what is the likely remedy?
• What are the elements of the Statute of Frauds, and which categories of contracts typically require a writing?
• Which statement constitutes an offer rather than an invitation to treat?
• Which statement best describes unilateral mistake and its typical remedy?
• Which of the following statements about consideration is incorrect?
• Which of the following statements about misrepresentation and its remedies is correct?
• A woman offers a reward for the return of her dog. A man finds the dog and returns it but has not seen the posters advertising the reward. Can he claim the reward?
• Which statements are typical implied terms in contracts?
• What is the duty to mitigate damages?
• If an offer requires acceptance to be in writing and signed, which form of acceptance is valid?
• What is essential to establish misrepresentation?
• For individuals with mental incapacity, the contract is generally what?
• Two friends enter into a written agreement: one will pay the other £50 if they stop complaining about the weather. Is this a valid contract?
• Which is the typical status of a contract entered by a minor?
• An investor asks for the best price on 800 troy ounces of platinum; a dealer replies with a price quotation £475 per ounce. What is the correct characterization of the communications?
• In anticipatory breach, the innocent party has the option to treat the contract as breached and sue immediately or take an alternative course. Which action is typically permissible when anticipatory breach occurs?
• Which concept describes capacity in contract law?
• In the battle of the forms, how can acceptance affect whether a contract forms?
• In a contract containing a liquidated damages clause, which factor is not a consideration used by courts to determine whether the clause is a penalty?
• In a unilateral contract, how is acceptance typically constituted?
• What is an integrated or entire agreement clause, and how does it affect parol evidence and prior negotiations?
• If misrepresentation induced a contract, the contract is typically:
• Under the Consumer Rights Act 2015, if a consumer asks for a product to be fit for a specific purpose and the seller supplies it not fit for that purpose, what term is breached?
• An agreement to install a boiler specifies only the make and model of the boiler and the price. Which statutory implied terms will be read into the contract?
• Which statement about misrepresentation remedies is correct?
• Which statement best describes common mistake and mutual mistake in contract law?
• Which of the following is not a common law exception to the doctrine of privity?
• If an offer prescribes a method of communication, that method should be used unless the alternative method is no less disadvantageous to the offeror. Which statement best reflects this rule?
• Which of the following terms might not be unfair under the Consumer Rights Act 2015?
• What is a collateral contract, and when can it create privity or enforceability for a third party?
• Are electronic contracts and signatures generally enforceable, and what conditions typically ensure their validity?
• A supplier offers to sell 500 chairs to a business for £20 each. The business replies, 'We accept your offer, provided delivery is included at no extra cost.' The supplier has not agreed to include delivery. What is the legal effect of the business's response?
• When a contract is breached, the damages are usually assessed by reference to which moment in time?
• A firm offer can be irrevocable for a stated time in some jurisdictions without consideration.
• Which statement correctly describes mistake of law and mistake of fact in terms of contract validity?
• Which of the following describes the form required for a binding contract for the sale of land?
• If a term is unclear whether it is a condition or a warranty, which test will the court apply to determine the remedy?
• Two parties negotiate by email over several days: 1 July offer, 2 July reply with terms, 3 July reply with counterterms, 4 July reply with further terms, and 5 July delivery occurs. Under the battle of forms, when and whose terms apply?
• What does restoration or adjustment of terms refer to in capacity remedies?
• To end a contract by agreement when performance has ceased, what formal steps are required?
• When would nominal damages be awarded in a contract case?
• Upon reaching capacity, what option may the person take to make a previously voidable contract enforceable?
• A dog breeder fraudulently misrepresents a dog's pedigree; after purchase the buyer discovers the misrepresentation. What is the status of the contract?
• Under the mailbox rule, when is acceptance effective if properly dispatched by post?
• Under the Supply of Goods and Services Act 1982, if no time for performance is agreed, the service must be performed within which time frame?
• Which statement correctly reflects the difference between liquidated damages and penalties?
• Some types of contracts must be evidenced by a deed to be enforceable. Which type is typically required to be evidenced by a deed?
• In general, to keep an offer open for a specified period without a separate mechanism, what is required?
• Which statement accurately describes actual and apparent authority in agency?
• Under the mirror image rule, what happens if the acceptance adds or modifies terms?
• Under the Law Reform (Frustrated Contracts) Act 1943, when a contract is frustrated and any expenses have been incurred before discharge, what may the court allow?
• What describes the general effect of a contract entered into by someone lacking capacity?
• Which statement about the Contracts (Rights of Third Parties) Act 1999 is true?
• Which statement is an invitation to treat?
• If a misrepresentation has occurred, what is the typical effect on the contract?
• If the offeree responds with changed terms, the result is typically a:
• When can an offer be revoked?
• A private boat buyer discovers the vessel is unseaworthy after purchase due to the seller’s misrepresentation. What rights does the buyer most likely have against the seller?
• Which is a limitation of the postal rule?
• Which option is the remedy that allows voiding obligations in a contract entered into by someone lacking capacity?
• A deep-sea fishing company hires a trawler and, after licenses are granted, uses licenses for other vessels. Can the fishing company rely on frustration to escape the hire contract?
• An owner offers to sell a bicycle for £150. The buyer posts acceptance on 20 January. The owner had previously received a rejection letter on 21 January but had not opened it; the owner opens and reads the acceptance on 22 January. Do the parties have a contract?
• A decorating contractor is paid for past work performed for friends who later dispute payment. Which statement correctly reflects the law on past consideration?
• Under the innominate term framework, the breach of which type of term may warrant termination if the breach deprives the party of the substantial benefit of the contract?
• What remedy allows a minor to avoid obligations contracted while lacking capacity?
• A man offers to buy his nephew's car, which the nephew, who works at a car dealership, is discussing with him on the phone. The man says, 'If I hear no more about the car, I consider it mine for £500'. The nephew remains silent but moves the car from the forecourt. Later, another staff member sells the car to a third party. Was there a valid contract between the man and his nephew?
• A shop advertises a sale at a stated price. In contract terms, such an advertisement is usually considered:
• In commercial contract practice, there is a presumption that the parties intend to create legal relations. This presumption is:
• Which remedy is not typically available for lack of capacity?
• Which remedy is an equitable remedy often available when specific performance is sought for breach of contract?
• What is the effect of duress on contract validity, and how do physical and economic duress differ?
• Which of the following is a privity exception that allows third parties to enforce or benefit from contracts?
• What is a collateral contract, and how can it impact enforceability when a separate assurance is given by one party to the other?
• What role do public policy and unconscionability play in assessing the validity and enforceability of contracts?
• Distinguish between assignment of rights and novation, including their effects on contractual obligations.
• What is the essential aim of damages for breach of contract?
• Which of the following describes the remedies for misrepresentation?
• Which statement accurately describes the consequences of breaching an innominate term?
• Which of the following is not an illegality defense?
• A misprint in a newspaper advertisement states a price of £70 for computers, while the correct price is £700. What is the correct position?
• What is an invitation to treat?
• Which statement best describes actual versus presumed undue influence?
• Which statement about consideration is correct?
• If a price quotation explicitly states that it is a firm offer valid for 7 days, acceptance within that period forms a binding contract.
• Which of the following is not a situation where a contract may be void for lack of capacity?
• A minor enters into a contract for the sale of necessary goods. The contract is generally:
• Which statement best describes the typical role of promissory estoppel in contract disputes?
• Express terms are best defined as terms that are
• Under a battle of the forms, when may a contract still form despite differing terms?
• Which of the following is not an equitable remedy?
• Has the contract between a famous comedy duo and its manager been frustrated if one member is called to military service and cannot perform?
• Where a price catalogue is issued in response to a specific inquiry about a model's price, and the buyer places an order and pays, the seller later claims the listed price was a mistake and demands extra payment. Will the buyer be bound to pay the higher price?
• Which groups may lack capacity to contract?
• Which statement best describes consideration in contract law?
• Under Hadley v Baxendale, which statement about damages is correct?
• Which term describes a third-party promise to pay or perform under a contract, creating rights for the third party?
• Which statement best defines misrepresentation in contract law?
• If the offeree adds new terms to the offer in response, what is the effect?
• Under the principle that consideration must be sufficient but need not be adequate, which statement is correct?
• Disaffirmance is the remedy that allows a party lacking capacity to void the contract under appropriate circumstances.
• Which statement about unilateral mistake is correct?
• A couple intend to celebrate their wedding anniversary at a certain venue. The contract price for the hire of the venue is £1,000, and the couple pays a £100 deposit in advance. The venue starts to make preparations for the catering, and spends £200 on supplies. A few days before the party is due to take place, the venue is destroyed by a hurricane. What is the correct legal position as regards the venue?
• Explain the concept of intended and incidental beneficiary contracts and the practical implications for third-party rights.
• Under the postal rule, when is acceptance effective?
• Which factor is commonly considered when assessing unconscionability in contract terms?
• An offer requires acceptance to be in writing and signed; which form of acceptance is valid?
• An antiques dealer agrees to sell a painting for £200, believing it to be unsigned and of unknown origin; later a hidden signature makes it highly valuable. What is the contract's status?
• What options does a non-breaching party have upon anticipatory breach (repudiation)?
• Which statement about the effect of an integrated clause on prior negotiations is accurate?
• Novation involves which of the following?
• If an antiques dealer withdraws five pieces from an auction before sale, will the buyer succeed in a breach of contract claim based on the auction catalogue?
• Incorporation by reference allows terms from another document to bind parties to terms not contained in the main contract if:
• What effect does an option contract have on the offer?
• Which form is required for a contract to bind the sale of land to be legally enforceable?
• A shop displays a television in its window with a price tag of £250. A customer enters and tells the cashier they wish to buy it for that price. The shopkeeper refuses to sell. Has a contract formed?
• Which statement best describes common mistake and mutual mistake in contract law?
• Which statement about contracts entered into by minors is true?
• Equitable remedies are granted at the discretion of the court, and are usually available where damages would not be an adequate remedy. Specific performance is an equitable remedy consisting of an order requiring performance. There are, however, several situations in which specific performance would not be granted. Which of the following is not one of those situations?
• In the battle of the forms, contract formation may depend on the last form or on terms plus agreed terms. Which statement best captures this?
• A flower supplier is aware of a large upcoming event in a local hotel, and wants to enter into a contract with a local florist to supply the flowers. The florist usually uses a different supplier, so the flower supplier threatens to ruin the reputation of the florist's business if the florist does not buy the supplier's flowers on unfavourable terms. What is the likely status of the contract between the supplier and the florist?
• Which option correctly distinguishes an injunction from specific performance?
• What may occur after ratification regarding terms?
• A farmer buys pesticide believed to be suitable for wheat, but the pesticide supplied is only suitable for fruit. What rights does the farmer have?
• A concert venue is destroyed by fire before a tour; can the singer terminate the contract and claim damages?
• Which description best states the remoteness rule?
• Which of the following is a typical exception to the parol evidence rule?
• A buyer contracts to purchase a rare Ming vase for £2,000; the seller then declines to sell. What is the likely remedy on breach?
• What is the effect of marking a contract 'subject to contract'?
• What does assignment/novation achieve in contract law?
• Acceptance must correspond to the terms; if extraneous terms are added, it is usually...
• When can counsel seek rescission after misrepresentation, and what limits apply to rescission in practice?
• Define promissory estoppel and explain when it can be used as a remedy or shield in contract disputes.
• Two businesses are negotiating a coal delivery contract. The written contract is marked 'subject to contract' pending a director's return from holiday. Do the parties have a binding contract?
• If a party is induced to enter a contract by misrepresentation about a material term, the contract is...
• Rescission and restitution: which description is accurate?
• How do contract modifications differ under common law versus the modern UCC regime regarding new consideration?
• Two businessmen enter into a contract for sale of iron to be shipped by sea from the seller's foundry in America to the buyer's address in Liverpool. The buyer was expecting the iron on the ship's January voyage, and the seller was expecting to deliver on the ship's February voyage. What is the legal position as regards the contract between the two businessmen?
• The pre-existing duty rule states that promising to perform a duty already owed is not valid consideration, with some exceptions. Which option describes one of the exceptions?
• A newspaper advertisement offering a reward for returning a lost dog is considered a unilateral contract; acceptance occurs when the task is performed.
• A man agrees to sell his 19th century cottage to a woman. He later refuses to sell. What remedy is most likely to be available to the woman?
• In a unilateral contract, acceptance is formed when the requested act is completed.
• Which statement about rescission as a remedy is accurate?
• What elements are required for a valid acceptance?
• Which of the following best describes the doctrine of frustration?
• When is a contract illegal?
• Which statement best describes breach and remedies for express and implied terms?