ACA LAW - EXAMINATION COMPLETE
QUESTIONS AND DETAILED SOLUTIONS
LATEST UPDATE THIS YEAR JUST RELEASED
Question 1: Are the following statements true or false? 1. Where a
party is in breach of contract, the other party may choose either to
treat the contract as discharged (and sue for damages) or to affirm
the contract. 2. Where a party causes an anticipatory breach of a
contract, i.e., they indicate in advance that they have no intention of
performing the contract, the other party may continue to incur
costs in performing the contract and take action against the party
in breach.
Answer:
1. False. This is only true where the breach is very serious. 2. True.
Question 2: Zak owes Eve £100. Finding that he has insufficient
cash, Zak offers Eve his bicycle worth £90 instead. Eve accepts.
Requirement Which of the following statements best describes the
legal position as to whether there is valid consideration? A Yes,
Eve was not already entitled to the bicycle so it is sufficient
consideration for waiver of the debt. B No, the bicycle is not
sufficient as it does not match or exceed the value of the debt. C
No, consideration must be in money or money's worth. D Yes, a
bicycle constitutes sufficient consideration because it has an
identifiable value.
Answer:
The value of the bicycle is irrelevant. It is something to which Eve was not
previously entitled.
Question 3: Are the following statements true or false? 1. In all
cases where a party to a contract fails to perform their contractual
obligations, they will be liable for breach of contract. 2. Provided a
,party to a contract substantially performs their contractual
obligations, that is a sufficient discharge of the contract and the
other party has no redress for those parts of the contract which
were not performed.
Answer:
1. False 2. False There will be no liability if they have a lawful excuse, for
example if the contract is discharged by frustration. The other party may seek
redress in respect of that part of the performance which did not match the
contractual obligations completely.
Question 4: Are the following statements true or false? 1. The
courts will interpret any ambiguity in an exclusion clause in favour
of the party not seeking to rely on it. 2. The Unfair Contract Terms
Act (UCTA) 1977 applies to all contracts, provided at least one party
is a commercial concern or business.
Answer:
1. True 2. False Feedback Certain contracts are excluded from the UCTA, for
example insurance contracts. The UCTA also only applies to
business-to-business contracts.
Question 5: Which of the following descriptions best describes the
statutory test of reasonableness under the Unfair Contract Terms
Act 1977? A Whether an ordinary person in the normal course of
business would consider the clause to be reasonable in all the
circumstances B Whether it is fair and reasonable, with regard to
all the circumstances which were, or which ought to have been
known to the parties when the contract was made C Whether it is
fair and reasonable with regard to all the circumstances which were
known to or in the reasonable contemplation of the parties D
Whether it is fair and reasonable to exclude liability, having regard
to the relative bargaining strengths of the parties
Answer:
, B Whether it is fair and reasonable, with regard to all the circumstances which
were, or which ought to have been known to the parties when the contract was
made
Question 6: Are the following statements true or false? 1.
Anticipatory breach may be implied from conduct and need not be
explicit. 2. Where an innocent party elects to treat a contract as
discharged, they waive the right to claim damages from the party in
default.
Answer:
1. True 2. False. They may treat the contract as discharged and sue for
damages.
Question 7: Are the following statements true or false? 1. Damages
for breach of contract are primarily intended to restore the injured
party to the same position they were in at the time when the
contract was made. 2 The claimant is required to take every
opportunity to mitigate their loss arising as a consequence of a
breach of contract.
Answer:
1. False. Damages are intended to put the party in the position they would
have been in had the contract been performed. 2. False. The claimant is
required to take only reasonable steps, not ones that carry undue risk or that
are discreditable.
Question 8: David lived next to a field owned by Frances. He
wished to widen the access to his property by two feet. When they
met at the village fete, Frances agreed to transfer a strip of land two
feet wide and 30 feet long, provided David erected attractive
fencing. She also said that there was no need for him to pay for the
land. Which of the following best describes the agreement between
Them? Select one: 1. There is no contract because there is no
, consideration for the transfer of land 2. The contract is void
because it is not in writing 3. The contract is voidable because it is
not in writing Incorrect 4. The contract is unenforceable because it
is not in writing
Answer:
An agreement to transfer land should be written and is unenforceable if not.
David's agreement to erect fencing is consideration. The correct answer is:
The contract is unenforceable because it is not in writing
Question 9: Janet owes George £500. Rhiannon telephones George
and promises that she will guarantee to pay the sum owed if Janet
cannot or does not pay. Janet fails to pay the £500 and so George
writes a letter to Rhiannon demanding payment. Which of the
following best describes the legal position as to whether Rhiannon
is obliged to pay George the £500? Select one: 1. There is a valid
agreement between George and Rhiannon and she must pay 2.
George's letter is written evidence of the terms of guarantee and
Rhiannon must pay 3. Rhiannon is not a party to the original
contract which created the debt owed by Janet so she cannot be
liable on the guarantee 4. The guarantee is unenforceable so
Rhiannon is not liable
Answer:
An oral guarantee needs to be evidenced in writing and signed or
acknowledged by the guarantor (Rhiannon). George's letter is therefore
insufficient. The correct answer is: The guarantee is unenforceable so
Rhiannon is not liable
Question 10: Are the following statements true or false? 1. An
advertisement in a newspaper can never constitute a valid offer, as
it is merely an invitation to treat. 2. An offer can be made to the
world at large
Answer:
QUESTIONS AND DETAILED SOLUTIONS
LATEST UPDATE THIS YEAR JUST RELEASED
Question 1: Are the following statements true or false? 1. Where a
party is in breach of contract, the other party may choose either to
treat the contract as discharged (and sue for damages) or to affirm
the contract. 2. Where a party causes an anticipatory breach of a
contract, i.e., they indicate in advance that they have no intention of
performing the contract, the other party may continue to incur
costs in performing the contract and take action against the party
in breach.
Answer:
1. False. This is only true where the breach is very serious. 2. True.
Question 2: Zak owes Eve £100. Finding that he has insufficient
cash, Zak offers Eve his bicycle worth £90 instead. Eve accepts.
Requirement Which of the following statements best describes the
legal position as to whether there is valid consideration? A Yes,
Eve was not already entitled to the bicycle so it is sufficient
consideration for waiver of the debt. B No, the bicycle is not
sufficient as it does not match or exceed the value of the debt. C
No, consideration must be in money or money's worth. D Yes, a
bicycle constitutes sufficient consideration because it has an
identifiable value.
Answer:
The value of the bicycle is irrelevant. It is something to which Eve was not
previously entitled.
Question 3: Are the following statements true or false? 1. In all
cases where a party to a contract fails to perform their contractual
obligations, they will be liable for breach of contract. 2. Provided a
,party to a contract substantially performs their contractual
obligations, that is a sufficient discharge of the contract and the
other party has no redress for those parts of the contract which
were not performed.
Answer:
1. False 2. False There will be no liability if they have a lawful excuse, for
example if the contract is discharged by frustration. The other party may seek
redress in respect of that part of the performance which did not match the
contractual obligations completely.
Question 4: Are the following statements true or false? 1. The
courts will interpret any ambiguity in an exclusion clause in favour
of the party not seeking to rely on it. 2. The Unfair Contract Terms
Act (UCTA) 1977 applies to all contracts, provided at least one party
is a commercial concern or business.
Answer:
1. True 2. False Feedback Certain contracts are excluded from the UCTA, for
example insurance contracts. The UCTA also only applies to
business-to-business contracts.
Question 5: Which of the following descriptions best describes the
statutory test of reasonableness under the Unfair Contract Terms
Act 1977? A Whether an ordinary person in the normal course of
business would consider the clause to be reasonable in all the
circumstances B Whether it is fair and reasonable, with regard to
all the circumstances which were, or which ought to have been
known to the parties when the contract was made C Whether it is
fair and reasonable with regard to all the circumstances which were
known to or in the reasonable contemplation of the parties D
Whether it is fair and reasonable to exclude liability, having regard
to the relative bargaining strengths of the parties
Answer:
, B Whether it is fair and reasonable, with regard to all the circumstances which
were, or which ought to have been known to the parties when the contract was
made
Question 6: Are the following statements true or false? 1.
Anticipatory breach may be implied from conduct and need not be
explicit. 2. Where an innocent party elects to treat a contract as
discharged, they waive the right to claim damages from the party in
default.
Answer:
1. True 2. False. They may treat the contract as discharged and sue for
damages.
Question 7: Are the following statements true or false? 1. Damages
for breach of contract are primarily intended to restore the injured
party to the same position they were in at the time when the
contract was made. 2 The claimant is required to take every
opportunity to mitigate their loss arising as a consequence of a
breach of contract.
Answer:
1. False. Damages are intended to put the party in the position they would
have been in had the contract been performed. 2. False. The claimant is
required to take only reasonable steps, not ones that carry undue risk or that
are discreditable.
Question 8: David lived next to a field owned by Frances. He
wished to widen the access to his property by two feet. When they
met at the village fete, Frances agreed to transfer a strip of land two
feet wide and 30 feet long, provided David erected attractive
fencing. She also said that there was no need for him to pay for the
land. Which of the following best describes the agreement between
Them? Select one: 1. There is no contract because there is no
, consideration for the transfer of land 2. The contract is void
because it is not in writing 3. The contract is voidable because it is
not in writing Incorrect 4. The contract is unenforceable because it
is not in writing
Answer:
An agreement to transfer land should be written and is unenforceable if not.
David's agreement to erect fencing is consideration. The correct answer is:
The contract is unenforceable because it is not in writing
Question 9: Janet owes George £500. Rhiannon telephones George
and promises that she will guarantee to pay the sum owed if Janet
cannot or does not pay. Janet fails to pay the £500 and so George
writes a letter to Rhiannon demanding payment. Which of the
following best describes the legal position as to whether Rhiannon
is obliged to pay George the £500? Select one: 1. There is a valid
agreement between George and Rhiannon and she must pay 2.
George's letter is written evidence of the terms of guarantee and
Rhiannon must pay 3. Rhiannon is not a party to the original
contract which created the debt owed by Janet so she cannot be
liable on the guarantee 4. The guarantee is unenforceable so
Rhiannon is not liable
Answer:
An oral guarantee needs to be evidenced in writing and signed or
acknowledged by the guarantor (Rhiannon). George's letter is therefore
insufficient. The correct answer is: The guarantee is unenforceable so
Rhiannon is not liable
Question 10: Are the following statements true or false? 1. An
advertisement in a newspaper can never constitute a valid offer, as
it is merely an invitation to treat. 2. An offer can be made to the
world at large
Answer:
