SQE Contract Law Exam Questions With Appropriate
Solutions.
Are goods on display offers or invitations to treat? - accurate answers-
Invitations to treat
Are advertisements offers or invitations to treat? - accurate answers-
Generally invitations to treat, but may amount to an offer if there is intention
to be bound
Are adverts of a reward an offer or invitation to treat? - accurate answers-
Treated as offers
What is a 'reserve price' in an auction? - accurate answers-a minimum price
below which the auctioneer cannot sell property: bidders will be aware there
is a reserve price but they will not know what it is
What happens if an auctioneer does not accept a bid at a without reserve
auction? - accurate answers-Auctioneer can be sued for breach of unilateral
contract. Damages will be the difference of the total value of product and the
bid
How can acceptance of an offer be communicated? - accurate answers-By
words or conduct
Is a conditional response deemed to be an acceptance of an offer? - accurate
answers-No. Conditional response is treated as a counter-offer, effectively
destroying original offer and representing a new offer that the other party can
accept or reject
When is acceptance by post effective? - accurate answers-As per postal rule,
letter of acceptance is effective when posted, even if the letter is lost in the
post
What conditions must be effective for postal rule to apply? - accurate answers-
It was reasonable in all the circumstances to use the post; the letter was
properly addressed, stamped and posted; the postal rule had not been
excluded by offeror
, How can termination of an offer occur? - accurate answers-Rejection by
offeree, revocation of offer by offeror, lapse of time
Can an offeror revoke an offer if they promised to keep the offer open for a
certain period of time? - accurate answers-Yes, unless the offeree has given
something in return for the promise to keep the offer open
When is revocation effective when electronically communicated? - accurate
answers-When it SHOULD HAVE been read
How should revocation be effected for offers made to the public at large? -
accurate answers-Publish a notice of revocation in the same place as offer
with the same prominence
Does the postal rule apply to revocation? - accurate answers-No, only
acceptance
How does the operation of presumption apply to domestic and commercial
agreements? - accurate answers-Domestic: rebuttable presumption that
parties did not intend to create legal relations
Commercial: strong presumption parties intended agreement to have legal
consequences
What is the rule for consideration regarding sufficiency and adequacy? -
accurate answers-Consideration must be sufficient, it need not be adequate
Is a promise to stop drinking alcohol sufficient consideration? - accurate
answers-Yes- as a matter of public policy things that should be positively
encouraged against will be sufficient consideration. 'In consideration of
natural love and affection' would not be sufficient
Is past consideration good consideration? - accurate answers-Generally no
unless:
- the past act was done at the promisor's request
- there was a mutual understanding between the parties that the act would be
compensated for in some way
- had the promise been made in advance, it would be legally enforceable
Solutions.
Are goods on display offers or invitations to treat? - accurate answers-
Invitations to treat
Are advertisements offers or invitations to treat? - accurate answers-
Generally invitations to treat, but may amount to an offer if there is intention
to be bound
Are adverts of a reward an offer or invitation to treat? - accurate answers-
Treated as offers
What is a 'reserve price' in an auction? - accurate answers-a minimum price
below which the auctioneer cannot sell property: bidders will be aware there
is a reserve price but they will not know what it is
What happens if an auctioneer does not accept a bid at a without reserve
auction? - accurate answers-Auctioneer can be sued for breach of unilateral
contract. Damages will be the difference of the total value of product and the
bid
How can acceptance of an offer be communicated? - accurate answers-By
words or conduct
Is a conditional response deemed to be an acceptance of an offer? - accurate
answers-No. Conditional response is treated as a counter-offer, effectively
destroying original offer and representing a new offer that the other party can
accept or reject
When is acceptance by post effective? - accurate answers-As per postal rule,
letter of acceptance is effective when posted, even if the letter is lost in the
post
What conditions must be effective for postal rule to apply? - accurate answers-
It was reasonable in all the circumstances to use the post; the letter was
properly addressed, stamped and posted; the postal rule had not been
excluded by offeror
, How can termination of an offer occur? - accurate answers-Rejection by
offeree, revocation of offer by offeror, lapse of time
Can an offeror revoke an offer if they promised to keep the offer open for a
certain period of time? - accurate answers-Yes, unless the offeree has given
something in return for the promise to keep the offer open
When is revocation effective when electronically communicated? - accurate
answers-When it SHOULD HAVE been read
How should revocation be effected for offers made to the public at large? -
accurate answers-Publish a notice of revocation in the same place as offer
with the same prominence
Does the postal rule apply to revocation? - accurate answers-No, only
acceptance
How does the operation of presumption apply to domestic and commercial
agreements? - accurate answers-Domestic: rebuttable presumption that
parties did not intend to create legal relations
Commercial: strong presumption parties intended agreement to have legal
consequences
What is the rule for consideration regarding sufficiency and adequacy? -
accurate answers-Consideration must be sufficient, it need not be adequate
Is a promise to stop drinking alcohol sufficient consideration? - accurate
answers-Yes- as a matter of public policy things that should be positively
encouraged against will be sufficient consideration. 'In consideration of
natural love and affection' would not be sufficient
Is past consideration good consideration? - accurate answers-Generally no
unless:
- the past act was done at the promisor's request
- there was a mutual understanding between the parties that the act would be
compensated for in some way
- had the promise been made in advance, it would be legally enforceable
