Contract Interpretation-Clause MCQ Quiz in मल्याळम - Objective Question with Answer for Contract Interpretation-Clause - സൗജന്യ PDF ഡൗൺലോഡ് ചെയ്യുക

The correct answer is Option 1.

Key Points

•  The Indian Contract Act 1872, came into force on 1st September 1872.
• The objective of the Indian Contract Act:
  • To provide a legal framework for individuals and entities to create and enforce valid contracts.
  • To define the rights and obligations arising from these contracts for the parties involved.
  • To establish certainty and predictability in commercial transactions by specifying conditions for the formation and execution of contracts.
  • To prevent fraud, misrepresentation, and unfair practices in contracts by specifying conditions for their validity.
  • To protect the interests of parties entering into contracts by providing remedies in case of breach or non-performance.
  • To protect the interests of parties entering into contracts by providing remedies in case of breach or non-performance.

The correct answer is all of the above.

Key Points

• The law of Contract is based on the principle laid down in the latin phrase Pacta sunt servanda which means 'agreements to be kept' or 'pacts must be kept'.
• In a contract, there is consensus ad idem which means 'meeting of minds' or "agreement to the same thing". Meeting of minds means that the parties have by the exchange of offer and acceptance known each other's consent. A contract, like a tort, is not unilateral.
• The word 'contract' is derived from the latin word contractus which means 'to work on contract'.

The correct answer is Halsbury.

Key Points

• Halsbury defines a contract to be, “an agreement between two or more persons which is intended to be enforceable at law and is constituted by the acceptance by one party of an offer made to him by the other party to do or abstain from doing some act.” 
• Salmond defines contract as, “an agreement creating and defining obligation between the parties.”
• Sir Frederick Pollock defines contract as, "a promise or set of promises which the law will enforce".

The correct answer is An act done in response to a positive promise.

Key Points 

• Executed consideration is a type of consideration where one party has already performed their obligation under a contract. This means that the party has already provided the promised goods, services, or other exchange before the other party is required to fulfill their obligation.

Some other things about executed consideration:

• Occurs when performance is complete: An executed consideration arises when one party has already completed their performance under the contract.

• Distinguished from executory consideration: Executory consideration, on the other hand, involves promises that are yet to be fulfilled by either party.

• Examples: Some examples of executed consideration include:

  • A baker delivering a cake to a customer after payment has been made.
  • A homeowner paying a contractor after they have finished painting the house.
  • A student receiving a gift from a parent after completing their exams.
• Consideration define under section 2(d) of ICA, 18972.
• Exception of consideration given under section 25 of ICA, 1872.

The correct answer is an agreement.

Key Points

• Under Section 2(e) of the Indian Contract Act, 1872, the law defines agreement as:
  • “Every promise and every set of promises, forming the consideration for each other, is an agreement.”
  • So, when two parties make promises to each other, and those promises form the consideration for one another, it is called an agreement.
• Promise – Defined in Section 2(b) as:
  • "When the person to whom the proposal is made signifies his assent thereto, the proposal is said to be accepted. A proposal when accepted becomes a promise."
• Consideration – The something in return (benefit or detriment) that each party provides to the other.
• So, when there are mutual promises that form consideration for each other, it becomes an agreement.

The correct answer is 'void.'

Key Points

• Void Agreements:
  • As per Section 2(g) of the Indian Contract Act, 1872, an agreement not enforceable by law is said to be void.
  • A void agreement has no legal effect and cannot be enforced in a court of law. Essentially, it is as if the agreement never existed.
  • Examples of void agreements include agreements that involve illegal activities, agreements made with parties who lack the capacity to contract, and agreements that are inherently impossible to perform.

Additional Information

• Voidable Agreements:
  • A voidable agreement is one that is initially valid and enforceable but can be rejected or voided by one of the parties under certain conditions, typically due to factors like misrepresentation, undue influence, or coercion.
  • Until it is voided by the aggrieved party, it remains enforceable in a court of law.
• Valid Agreements:
  • A valid agreement is one that meets all the essential elements of a contract as per the Indian Contract Act, 1872, and is fully enforceable by law.
  • These elements include free consent, lawful consideration, competent parties, and a lawful object.
• Invalid Agreements:
  • The term "invalid" is not specifically defined in the Indian Contract Act, but it generally refers to agreements that are either void or voidable.
  • An invalid agreement lacks legal enforceability and is not recognized by the law.

The correct answer is 'promise under Section 2(b)'

Key Points

• Promise under Section 2(b) of the Indian Contract Act, 1872:
  • According to Section 2(b) of the Indian Contract Act, 1872, when the person to whom a proposal is made signifies their assent, the proposal becomes a promise.
  • A proposal is also known as an "offer," and once it is accepted, it transforms into a "promise," which is a crucial step in contract formation.
  • This promise lays the foundation for an agreement, and once legal enforceability is established, it results in a contract under the Act.

Additional Information

• Agreement under Section 2(e):
  • Section 2(e) defines an "agreement" as every promise and every set of promises forming the consideration for each other.
  • A promise is a part of an agreement, but an agreement itself consists of mutual obligations between the parties.
  • Hence, an accepted proposal does not immediately become an agreement; instead, it first becomes a promise.
• Contract under Section 2(h):
  • According to Section 2(h), a contract is an agreement enforceable by law.
  • An accepted proposal (promise) does not automatically turn into a contract unless it fulfills all legal requirements, such as lawful consideration and capacity of parties.
  • Therefore, an accepted proposal is only the initial step towards forming a contract but is not a contract by itself.
• Mere formality under the provisions:
  • Considering an accepted proposal as a mere formality is incorrect because it is a legally significant step in contract formation.
  • Every contract begins with a proposal, and acceptance converts it into a promise, which further progresses to an agreement and then a contract.
  • Thus, calling an accepted proposal a mere formality undermines its importance in the legal framework of contracts.

The correct answer is Option 1.

Key Points Under the Indian Contract Act, 1872:

• Reciprocal promises are defined as promises which form the consideration or part of the consideration for each other (see Section 2(f) of the Indian Contract Act, 1872). Essentially, each party's promise is the consideration for the other party's promise, making them reciprocal.

The correct answer is Option 1.

Key Points Privity of Contract:

• Definition:
  The doctrine of privity of contract states that only the parties to a contract have the right to sue each other for the enforcement of contractual obligations.

  • A third party, even if they stand to benefit from the contract, generally cannot sue for its enforcement.

• Example:
  If A and B enter into a contract, and C (a third party) benefits from the contract, C cannot sue A or B for non-fulfillment of the contract unless they are a party to the agreement.

• Key Case Law:

  • Dunlop Pneumatic Tyre Co. Ltd. v. Selfridge & Co. Ltd.:
    • The House of Lords upheld the principle that a third party cannot enforce a contract unless they are a party to it.

The Correct answer is a Bilateral contract

Key Points A bilateral contract is a contract in which both parties exchange promises to perform. One party’s promise serves as consideration for the promise of the other. As a result, each party is an obligor on that party’s own promise and an obligee on the other’s promise.