CONTRACT LAW EXAM
QUESTIONS WITH CORRECT
DETAILED ANSWERS
When will courts not enforce a contract due to uncertainty? - Answer-When the court is
unable to conclude that the parties intended to be legally bound, due to a lack of
certainty in essential terms.
Can courts enforce a contract if only part of it is uncertain? - Answer-Yes, courts may
sever an uncertain term if it is not essential to the contract and enforce the rest.
Does the commencement of performance affect how courts handle contractual
uncertainty? - Answer-Yes, if performance has begun and obligations have arisen,
courts are more likely to uphold the contract by interpreting or implying terms.
How does an arbitration clause impact a court's willingness to enforce an uncertain
contract? - Answer-The existence of an arbitration clause may support the inference
that the parties intended to be bound and had a mechanism for resolving disputes.
What is the legal effect of marking an agreement "subject to contract"? - Answer-It
means the parties do not intend to be legally bound until a formal contract is signed.
This overrides the usual presumption of legal intent in commercial deals.
What is an invitation to treat in contract law? - Answer-It is an expression of willingness
to negotiate, not a valid offer. It invites others to make an offer, which can then be
accepted or rejected.
What terms are implied into a mixed contract for goods and installation under the
Supply of Goods and Services Act 1982? - Answer-A condition that the goods (e.g.
boiler) will be of satisfactory quality, and innominate terms that the service (e.g.
installation) will be carried out with reasonable care and skill, and within a reasonable
time if no time is agreed.
Can the manufacturer later change the price due to a mistake in the catalogue? -
Answer-No. A unilateral mistake does not void the contract unless the buyer knew or
should have known of the error.
What is a mutual mistake in contract law? - Answer-When both parties misunderstand
each other and are at cross purposes about a key term (e.g. different meanings of
"container").
, What is a unilateral mistake in contract law? - Answer-When one party is mistaken and
the other party knew or should have known (e.g. a bid far lower than others due to a
clear error).
Is a contract void if a party agrees to pay more due to economic duress? - Answer-No.
The contract remains valid, but the modification may be voidable if obtained through
bad faith pressure or illegitimate threat.
Is a contract valid if both parties mistakenly believe the subject matter still exists when it
does not? - Answer-No, it is void for mistake if the subject matter no longer exists at the
time of contract (e.g. goods destroyed).
If a person is pressured by threats to sell property, is the contract valid? - Answer-No, it
is voidable for duress if the threat (e.g. to report a relationship) overbears the party's
free will.
Is a contract void if both parties are mistaken about a detail that doesn't affect the
essential subject matter? - Answer-No, if the mistake is not fundamental (e.g. year of a
car), the contract is valid.
Is a wife's guarantee for her spouse's loan automatically voidable for undue influence? -
Answer-No, if the spouse is financially independent and there's no pressure, the
contract is valid.
Can a contract be enforced if it involves illegal performance? - Answer-Only by an
innocent party. If a party knowingly engages in illegal conduct (e.g. speeding), they
cannot enforce the contract.
Is a hotel booking by an unmarried couple enforceable? - Answer-Yes. It is not contrary
to public policy or morality and is fully enforceable.
When are damages in lieu of rescission available under misrepresentation law? -
Answer-✅ Yes - for negligent or innocent misrepresentation (e.g. mistake with tape
measure; seller passing on auction info in good faith).
❌ No - for fraudulent misrepresentation (e.g. knowingly lying about the car's model
year). Rescission and/or tort damages apply instead.
Must the innocent party wait until the performance date to sue for anticipatory breach? -
Answer-No. The innocent party can sue immediately upon clear repudiation before
performance is due.
What is the effect of undue influence on a contract? - Answer-The contract is voidable
at the option of the innocent party, who may choose to affirm or rescind it.
What happens if a concert venue is destroyed before a scheduled performance? -
Answer-The contract is frustrated and automatically discharged. No party can sue for
QUESTIONS WITH CORRECT
DETAILED ANSWERS
When will courts not enforce a contract due to uncertainty? - Answer-When the court is
unable to conclude that the parties intended to be legally bound, due to a lack of
certainty in essential terms.
Can courts enforce a contract if only part of it is uncertain? - Answer-Yes, courts may
sever an uncertain term if it is not essential to the contract and enforce the rest.
Does the commencement of performance affect how courts handle contractual
uncertainty? - Answer-Yes, if performance has begun and obligations have arisen,
courts are more likely to uphold the contract by interpreting or implying terms.
How does an arbitration clause impact a court's willingness to enforce an uncertain
contract? - Answer-The existence of an arbitration clause may support the inference
that the parties intended to be bound and had a mechanism for resolving disputes.
What is the legal effect of marking an agreement "subject to contract"? - Answer-It
means the parties do not intend to be legally bound until a formal contract is signed.
This overrides the usual presumption of legal intent in commercial deals.
What is an invitation to treat in contract law? - Answer-It is an expression of willingness
to negotiate, not a valid offer. It invites others to make an offer, which can then be
accepted or rejected.
What terms are implied into a mixed contract for goods and installation under the
Supply of Goods and Services Act 1982? - Answer-A condition that the goods (e.g.
boiler) will be of satisfactory quality, and innominate terms that the service (e.g.
installation) will be carried out with reasonable care and skill, and within a reasonable
time if no time is agreed.
Can the manufacturer later change the price due to a mistake in the catalogue? -
Answer-No. A unilateral mistake does not void the contract unless the buyer knew or
should have known of the error.
What is a mutual mistake in contract law? - Answer-When both parties misunderstand
each other and are at cross purposes about a key term (e.g. different meanings of
"container").
, What is a unilateral mistake in contract law? - Answer-When one party is mistaken and
the other party knew or should have known (e.g. a bid far lower than others due to a
clear error).
Is a contract void if a party agrees to pay more due to economic duress? - Answer-No.
The contract remains valid, but the modification may be voidable if obtained through
bad faith pressure or illegitimate threat.
Is a contract valid if both parties mistakenly believe the subject matter still exists when it
does not? - Answer-No, it is void for mistake if the subject matter no longer exists at the
time of contract (e.g. goods destroyed).
If a person is pressured by threats to sell property, is the contract valid? - Answer-No, it
is voidable for duress if the threat (e.g. to report a relationship) overbears the party's
free will.
Is a contract void if both parties are mistaken about a detail that doesn't affect the
essential subject matter? - Answer-No, if the mistake is not fundamental (e.g. year of a
car), the contract is valid.
Is a wife's guarantee for her spouse's loan automatically voidable for undue influence? -
Answer-No, if the spouse is financially independent and there's no pressure, the
contract is valid.
Can a contract be enforced if it involves illegal performance? - Answer-Only by an
innocent party. If a party knowingly engages in illegal conduct (e.g. speeding), they
cannot enforce the contract.
Is a hotel booking by an unmarried couple enforceable? - Answer-Yes. It is not contrary
to public policy or morality and is fully enforceable.
When are damages in lieu of rescission available under misrepresentation law? -
Answer-✅ Yes - for negligent or innocent misrepresentation (e.g. mistake with tape
measure; seller passing on auction info in good faith).
❌ No - for fraudulent misrepresentation (e.g. knowingly lying about the car's model
year). Rescission and/or tort damages apply instead.
Must the innocent party wait until the performance date to sue for anticipatory breach? -
Answer-No. The innocent party can sue immediately upon clear repudiation before
performance is due.
What is the effect of undue influence on a contract? - Answer-The contract is voidable
at the option of the innocent party, who may choose to affirm or rescind it.
What happens if a concert venue is destroyed before a scheduled performance? -
Answer-The contract is frustrated and automatically discharged. No party can sue for
