LAW-F26-CONTRACTS-03 COMPREHENSIVE MOCK
EXAM PREDICTOR 2026/2027 Q&A
Which of the following best describes the essential element that distinguishes a
contract from a mere agreement?
A. The presence of mutual assent between parties
B. The existence of legal enforceability
C. The inclusion of written documentation
D. The requirement of third-party witnessing
Correct Answer: B
Explanation: A contract is specifically an agreement that is legally enforceable,
whereas not all agreements create legal obligations. Mutual assent (A) is
necessary but not sufficient; writing (C) and witnessing (D) are not universally
required for contract validity.
In the case of Carlill v. Carbolic Smoke Ball Co, what legal principle was established
regarding advertisements?
A. Advertisements are always invitations to treat
B. Advertisements can constitute offers to the whole world
C. Advertisements require written acceptance
D. Advertisements are void unless signed
Correct Answer: B
Explanation: Carlill v. Carbolic Smoke Ball Co established that certain
advertisements can constitute binding offers to the general public, not merely
invitations to treat. This distinguishes it from Harris v. Nickerson where
advertisements were invitations to treat.
Which scenario demonstrates BEST the principle of "consideration must be
sufficient but need not be adequate"?
A. A promises to sell his car worth £10,000 for £1,000
B. A promises to donate £500 to B's charity without B requesting it
C. A promises to pay B £100 if B stops smoking
D. A promises to extend B's deadline without receiving anything in return
Correct Answer: A
, Explanation: Consideration is sufficient if it has some economic value,
regardless of whether it equals the market value (adequacy). Option A shows
inadequate but sufficient consideration. Options B and D lack consideration
entirely, while C involves past consideration issues.
Under the postal acceptance rule, when is a contract formed?
A. When the acceptance letter is received by the offeror
B. When the acceptance letter is posted by the offeree
C. When the offeror reads the acceptance letter
D. When the acceptance is confirmed by telephone
Correct Answer: B
Explanation: The postal acceptance rule states that acceptance is complete
when the letter is posted by the offeree, not when received. This is a special
exception to the general requirement that acceptance must be communicated.
Which of the following is NOT a valid exception to the requirement of consideration?
A. Agreements made under natural love and affection between near relatives
B. Promises to pay for past voluntary services
C. Agreements to compromise doubtful claims
D. Promises supported by statutory declaration
Correct Answer: D
Explanation: Section 26(a) of the Contracts Act provides exceptions for natural
love/fair between relatives (A), past voluntary services under certain conditions
(B), and compromise agreements (C). Statutory declaration alone doesn't
substitute for consideration.
In Pharmaceutical Society of Great Britain v Boots Cash Chemist, what was the key
legal finding?
A. Display of goods is always an offer
B. Display of goods on shelves is an invitation to treat
C. Customers make offers when selecting goods
D. Shops must accept all customer selections
Correct Answer: B
Explanation: The case established that displaying goods on shelves or in
windows is an invitation to treat, not an offer. The customer makes the offer at
the counter, which the shop can accept or reject.
, What distinguishes a condition from a warranty in contract terms?
A. Conditions must be written; warranties can be oral
B. Conditions are essential terms; warranties are subsidiary
C. Conditions apply to sellers; warranties apply to buyers
D. Conditions require registration; warranties do not
Correct Answer: B
Explanation: Conditions are essential terms that go to the root of the contract—
breach allows termination. Warranties are subsidiary terms—breach only
allows damages, not termination.
Which case demonstrates that an agreement lacking certainty is not enforceable?
A. Harris v. Nickerson
B. Farid agreed to sell handphone at RM900 OR 1000
C. Carlill v. Carbolic Smoke Ball Co
D. Pharmaceutical Society v. Boots
Correct Answer: B
Explanation: The Farid case shows no valid offer when terms are uncertain
(RM900 OR 1000). Certainty is essential for contract validity; ambiguous
terms prevent enforceability.
What is the primary legal effect of a counter-offer?
A. It accepts the original offer with modifications
B. It terminates the original offer and creates a new offer
C. It delays acceptance of the original offer
D. It requires written confirmation from the offeror
Correct Answer: B
Explanation: A counter-offer is a modification that rejects and terminates the
original offer, creating a new offer. It is not acceptance (A), doesn't merely
delay (C), and doesn't require written confirmation (D).
Which vitiating factor makes a contract VOID rather than VOIDABLE?
A. Misrepresentation
B. Fraud
EXAM PREDICTOR 2026/2027 Q&A
Which of the following best describes the essential element that distinguishes a
contract from a mere agreement?
A. The presence of mutual assent between parties
B. The existence of legal enforceability
C. The inclusion of written documentation
D. The requirement of third-party witnessing
Correct Answer: B
Explanation: A contract is specifically an agreement that is legally enforceable,
whereas not all agreements create legal obligations. Mutual assent (A) is
necessary but not sufficient; writing (C) and witnessing (D) are not universally
required for contract validity.
In the case of Carlill v. Carbolic Smoke Ball Co, what legal principle was established
regarding advertisements?
A. Advertisements are always invitations to treat
B. Advertisements can constitute offers to the whole world
C. Advertisements require written acceptance
D. Advertisements are void unless signed
Correct Answer: B
Explanation: Carlill v. Carbolic Smoke Ball Co established that certain
advertisements can constitute binding offers to the general public, not merely
invitations to treat. This distinguishes it from Harris v. Nickerson where
advertisements were invitations to treat.
Which scenario demonstrates BEST the principle of "consideration must be
sufficient but need not be adequate"?
A. A promises to sell his car worth £10,000 for £1,000
B. A promises to donate £500 to B's charity without B requesting it
C. A promises to pay B £100 if B stops smoking
D. A promises to extend B's deadline without receiving anything in return
Correct Answer: A
, Explanation: Consideration is sufficient if it has some economic value,
regardless of whether it equals the market value (adequacy). Option A shows
inadequate but sufficient consideration. Options B and D lack consideration
entirely, while C involves past consideration issues.
Under the postal acceptance rule, when is a contract formed?
A. When the acceptance letter is received by the offeror
B. When the acceptance letter is posted by the offeree
C. When the offeror reads the acceptance letter
D. When the acceptance is confirmed by telephone
Correct Answer: B
Explanation: The postal acceptance rule states that acceptance is complete
when the letter is posted by the offeree, not when received. This is a special
exception to the general requirement that acceptance must be communicated.
Which of the following is NOT a valid exception to the requirement of consideration?
A. Agreements made under natural love and affection between near relatives
B. Promises to pay for past voluntary services
C. Agreements to compromise doubtful claims
D. Promises supported by statutory declaration
Correct Answer: D
Explanation: Section 26(a) of the Contracts Act provides exceptions for natural
love/fair between relatives (A), past voluntary services under certain conditions
(B), and compromise agreements (C). Statutory declaration alone doesn't
substitute for consideration.
In Pharmaceutical Society of Great Britain v Boots Cash Chemist, what was the key
legal finding?
A. Display of goods is always an offer
B. Display of goods on shelves is an invitation to treat
C. Customers make offers when selecting goods
D. Shops must accept all customer selections
Correct Answer: B
Explanation: The case established that displaying goods on shelves or in
windows is an invitation to treat, not an offer. The customer makes the offer at
the counter, which the shop can accept or reject.
, What distinguishes a condition from a warranty in contract terms?
A. Conditions must be written; warranties can be oral
B. Conditions are essential terms; warranties are subsidiary
C. Conditions apply to sellers; warranties apply to buyers
D. Conditions require registration; warranties do not
Correct Answer: B
Explanation: Conditions are essential terms that go to the root of the contract—
breach allows termination. Warranties are subsidiary terms—breach only
allows damages, not termination.
Which case demonstrates that an agreement lacking certainty is not enforceable?
A. Harris v. Nickerson
B. Farid agreed to sell handphone at RM900 OR 1000
C. Carlill v. Carbolic Smoke Ball Co
D. Pharmaceutical Society v. Boots
Correct Answer: B
Explanation: The Farid case shows no valid offer when terms are uncertain
(RM900 OR 1000). Certainty is essential for contract validity; ambiguous
terms prevent enforceability.
What is the primary legal effect of a counter-offer?
A. It accepts the original offer with modifications
B. It terminates the original offer and creates a new offer
C. It delays acceptance of the original offer
D. It requires written confirmation from the offeror
Correct Answer: B
Explanation: A counter-offer is a modification that rejects and terminates the
original offer, creating a new offer. It is not acceptance (A), doesn't merely
delay (C), and doesn't require written confirmation (D).
Which vitiating factor makes a contract VOID rather than VOIDABLE?
A. Misrepresentation
B. Fraud
