What are the essentials for valid contract as mentioned under section 10 of the Law of Contract Act,

[CAP 345 RE 2002]?

Select one or more:

a. Legality
b. Intention to create legal relations

c. Free Consent

d. Capacity

e. Consideration

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Section 10 of the Law of Contract Act, [CAP 345 RE 2002] provides that all agreements are
contracts if they are made by the free consent of parties competent to contract, for a lawful
consideration and with a lawful object, and are not hereby expressly declared to be void
The correct answers are: Free Consent, Consideration, Legality, Capacity

Question 2
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Through which ways the valid offer can be terminated?

Select one or more:

a. Revocation
b. Rejection

c. Counter offer
d. Death or insanity
e. Lapse of time

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Section 6 of the Law of Contract Act, [CAP 345 RE 2002] provides that a proposal is terminated by
the communication of notice of revocation by the proposer to the other party, by the lapse of the time
prescribed in such proposal for its acceptance, or, if no time is so prescribed, by the lapse of a
reasonable time, without communication of the acceptance, by the failure of the acceptor to fulfil a
condition precedent to acceptance or by the death or insanity of the proposer, if the fact of his death
or insanity comes to the knowledge of the acceptor before acceptance
The correct answers are: Lapse of time, Death or insanity, Rejection, Revocation

Question 3
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When can acceptance be revoked legally?

Select one:
a. At any time before the communication of the acceptance is complete as against the

acceptor.
b. At any time after the communication of the proposal is complete as against the acceptor
c. At any time before the communication of the proposal is complete as against the acceptor.
d. At any time after the communication of the acceptance is complete as against the acceptor

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Section 5(2) of the Law of Contract Act, [CAP 345 RE 2002] provides that an acceptance may be
revoked at any time before the communication of the acceptance is complete as against the
acceptor, but not afterwards
The correct answer is: At any time before the communication of the acceptance is complete as
against the acceptor.

Question 4
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When communication of acceptance becomes complete?

Select one or more:

a. When it is posted at the Post office
b. When they reach persons

c. When they come into the knowledge of the proposer

d. When they are out of control of sender

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Section 4(2) of the Law of Contract Act, [CAP 345 RE 2002] provides that the communication of an
acceptance is complete as against the proposer, when it is put in a course of transmission to him, to
be out of the power of the acceptor and as against the acceptor, when it comes to the knowledge of
the proposer.
The correct answers are: When they are out of control of sender, When they come into the
knowledge of the proposer

Question 5
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When can offer be revoked legally?

Select one:
a. At any time before communication of its expiration is complete
b. At any time before communication of its rejection is complete
c. At any time before communication of its revocation is complete

d. At any time before communication of its acceptance is complete

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Section 5(1) of the Law of Contract Act, [CAP 345 RE 2002] provides that a proposal may be
revoked at any time before the communication of its acceptance is complete as against the
proposer, but not afterwards.
The correct answer is: At any time before communication of its acceptance is complete

Question 6
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What are necessary conditions for a valid offer?

Select one or more:

a. It can be communicated to the world

b. It must be final expression

c. It must be certain

d. It must be known to the offeree

e. It must be clear

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Section 2(1)(a) of the Law of Contract Act, [CAP 345 RE 2002] when one person signifies to another
his willingness to do or to abstain from doing anything, with a view to obtaining the assent of that
other to such act or abstinence, he is said to make a proposal.
The correct answers are: It must be clear, It must be certain, It must be final expression, It must be
known to the offeree

Question 7
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What are the prerequisites for a valid acceptance?

Select one or more:

a. It must be communicated to the promisor

b. It must be unqualified
c. It must be told to the world

d. It must be absolute
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Section 7 of the Law of Contract Act, [CAP 345 RE 2002] provides for the prerequisites for valid
acceptance. It provides that to convert a proposal into a promise, the acceptance must be absolute
and unqualified and must be expressed in some usual and reasonable manner
The correct answers are: It must be absolute, It must be unqualified, It must be communicated to the
promisor

Question 8
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What are the objectives of requiring contracts to be written?

Select one or more:

a. To promote relationship

b. For future references

c. To avoid fraud

d. For evidence purpose

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The correct answers are: For future references, For evidence purpose, To avoid fraud

Question 9
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Why some contracts are called simple contracts?

Select one:
a. They are simple to make
b. They favour both parties
c. They are not required to be in writing or that they should be evidenced by some writing
d. They are enforceable

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The correct answer is: They are not required
to be in writing or that they should be evidenced by some writing

Question 10
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What are the rationales of treating contracts unenforceable, void, voidable or illegal?

Select one or more:

a. To ensure fair play in contractual transactions

b. To limit enforcement of actions
c. To promote understanding between parties.
d. To protect interests of property owners

e. To protect interests of the bonafide purchaser

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The correct answers are: To limit enforcement of actions, To ensure fair play in contractual
transactions, To protect interests of property owners, To protect interests of the bonafide purchaser