AILET (All India Law Entrance Test) 2019 MCQs Questions with Solutions and Explanations at Doorsteptutor. Com Part 12

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Question 79

Directions: Apply the legal principles to the facts given below and select the most appropriate answer.

Legal Principles:

(1) A contract comes into being from the acceptance of an offer. When the person to whom the offer is made signifies his assent thereto, the proposal is said to be accepted and the parties are at consensus ad idem regarding the terms of the agreement.

(2) Consideration is something that moves from the promisee to the promisor, at the Implied or express request of the latter, in return for his promise. The item that moves can be a right, interest, profit, loss, responsibility given or suffered, forbearance or a benefit which Is of some value in the eyes of law.

(3) Contractual rights and liabilities are exclusive to the parties to contract.

(4) There are few exceptions to the doctrine of privity of contract like agency, trust, assignment and third-party beneficiary.

(5) A quasi contract is a contract that is created by the court when no such official contract exists between the parties to prevent a party from being unjustly enriched, or from benefitting from the situation when he does not deserve to do so.

Facts: Good-tyre is a tyre manufacturer who agreed with their dealer to not sell the tyres below a recommended retail price (RRP) . As part of the agreement, Good-tyre also required their dealers to gain the same agreement with their retailers, who in this instance was Best motors. The agreement held that if tyres were sold below the RAP, they would be required to pay 500 per tyre in damages to Goodtyre. This was agreed between the dealer and Best motors, which effectively made Good tyre a third-party to that agreement. Sometime after this, Best motor sold the lyres below the agreed price and Goodtyre sued for damages and an injunction to prevent them from continuing this activity. Best motor is arguing that Goodtyre could not enforce the contract as it was not part of the contract between the dealer and the Best motor. The court decided that Goodtyre had no right to access damages. Which of the following are correct reasons?

I. Goodtyre could not claim for damages as only a party to a contract can claim damages under it.

II. Good tyre had not given any consideration to Best motor and therefore there could be no binding contract between the parties.

III. Good tyre was not listed as an agent within the contract and could therefore not be included as a valid third-party who had rights to claim on the contract.

A. I only

B. II only

C. I and II

D. I, II, III

Question 80

Directions: Apply the legal principles to the facts given below and select the most appropriate answer.

Legal Principles:

(1) A contract comes into being from the acceptance of an offer. When the person to whom the offer is made signifies his assent thereto, the proposal is said to be accepted and the parties are at consensus ad idem regarding the terms of the agreement.

(2) Consideration is something that moves from the promisee to the promisor, at the Implied or express request of the latter, in return for his promise. The item that moves can be a right, interest, profit, loss, responsibility given or suffered, forbearance or a benefit which Is of some value in the eyes of law.

(3) Contractual rights and liabilities are exclusive to the parties to contract.

(4) There are few exceptions to the doctrine of privity of contract like agency, trust, assignment and third-party beneficiary.

5. A quasi contract is a contract that is created by the court when no such official contract exists between the parties to prevent a party from being unjustly enriched, or from benefitting from the situation when he does not deserve to do so.

Facts: Nandini, by deed of gift, made over certain landed property to Reena, her daughter. By the terms of the deed, which was registered, it was stipulated that an annuity of ₹ 3,000 should be paid every year to the Subhashlni, sister of Nandini. Reena executed in Subhashini՚s favour an agreement promising to give effect to the stipulation. The annuity was, however, not paid and the Subhashini sued to recover It. Reena is defending herself by claiming that there is no valid contract with Subhashini. Which of the following can be ground/s for court՚s decision?

I. A promise is enforceable if there is some consideration for it and it is quite immaterial whether it moves from the promise or any other person.

II. Only a person who is a party to a contract may demand the execution of that contract from other party. But if there is third party beneficiary to contract then it is enforced to the extent of his⧵her benefit.

III. The agreement is valid as both Reena and Subhashini agreed to on the same thing in the same sense.

IV. There is no privity of contract as Subhashini has furnished no consideration. Reena had promised to Subhashini but consideration was furnished by Nandini.

A. I, II

B. III, IV

C. I only

D. II only

Question 81

Directions: Apply the legal principles to the facts given below and select the most appropriate answer.

Legal Principles:

(1) A contract comes into being from the acceptance of an offer. When the person to whom the offer is made signifies his assent thereto, the proposal is said to be accepted and the parties are at consensus ad idem regarding the terms of the agreement.

(2) Consideration is something that moves from the promisee to the promisor, at the Implied or express request of the latter, in return for his promise. The item that moves can be a right, interest, profit, loss, responsibility given or suffered, forbearance or a benefit which Is of some value in the eyes of law.

(3) Contractual rights and liabilities are exclusive to the parties to contract.

(4) There are few exceptions to the doctrine of privity of contract like agency, trust, assignment and third-party beneficiary.

(5) A quasi contract is a contract that is created by the court when no such official contract exists between the parties to prevent a party from being unjustly enriched, or from benefitting from the situation when he does not deserve to do so.

Facts: Tanu՚s brother, Ishan, tries to talk her into building a greenhouse in her large back-yard. She declines, but Ishan is convinced that, if she were surprised by a lovely greenhouse, she would love it. Knowing that Tanu makes good money. and could easily afford the greenhouse, Ishan contacts greenhouse builder Aditya, and arranges to have him erect the structure while his sister is at work one day.

Tanu is not happy by her brother՚s initiative, but the deed is done. Ishan has directed Aditya to bill his sister for the greenhouse, and that turns out to be the biggest surprise for her. She declines to pay, and Ishan tells Aditya he cannot afford it. Aditya is now out, not only for payment for his many hours of hard wont, but cash for the materials he used. He files a civil suit to claim against both Tanu and Ishan. Decide.

A. Ishan is liable to pay as he has entered into contract with Aditya for his services.

B. Tanu is not liable to pay as there is no contract between Aditya and Tanu.

C. Tanu is liable to pay Aditya the costs involved in building the greenhouse as she has being unjustly enriched by this deal.

D. Tanu is liable as Ishan is her brother and was acting on her behalf under her implied consent as she liked greenhouse.

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