MCQs on The Ind

1. MCQS ON THE INDIAN CONTRACT ACT, 1872 PART 2

MCQs on The Indian Contract Act, 1872 Part 2

Q.1:- Where neither party any appropriation, the payment shall be applied:
a. If the debts are of equal standing, the payment shall be applied in discharge of each
proportion ably.
b. In discharge of the debts in order of time.
c. Whether they are or are not barred by the law in force for the time being in as to the
limitations of suits.
d. All of the above
Q.2:- What are the obligation of person enjoying benefit of non-gratuitous act:
a. The person enjoyed the benefits is bound to make compensation to the provider of the
goods/services.
b. The person enjoyed the benefits is not bound to make compensation to the provider of
the goods/services.
c. The person enjoyed the benefits has not asked for providing the goods/services hence
not bound.
d. None of the above.

Q.3:- What is the meaning of ‘Quantum Meruit ’:

a. As much as saved
b. As much as paid
c. As much as retained
d. As much as earned

Q.4:- What are the consequences when a person who finds goods belonging to another
and takes then into his custody:
a. He is subject to the same responsibility as a bailee.
b. He is bound to take as much care of the goods as a man of ordinary prudence would do.
c. He must also take all measures to trace its owner.
d. All of the above.

Q.5:- The Doctrine of Restitution may mean:

a. The position in which he would have been had there been performance not breach of the
contract.
b. To put the injured party in the same position
c. To compensate for the pecuniary loss which naturally flows from the breach.
d. All of the above.

Q.6:- Vindictive damages are:

 a. These damages are in the nature of the punishment.
b. These damages are indicative in nature only.
c. These are simple damages
d. None of the above.

Q.7:- When a contract is broken, what remedy is available before the party who has
suffered:
a. He may sue for the specific performance of the contract.
b. He may rescind the contract.
c. He may sue for damages
d. All of the above.

Q.8:- The case titled as Hadley v. Baxendale, which the foundation of the modem law of
damages states that:
a. Compensation is not to be given for any remote or indirect loss or damages sustained by
reason of the breach.
b. The injured party is entitled to ordinary damages which naturally arose in the usual
course of things from such breach.
c. Both A and B are correct.
d. None of the above.

Q.9:- Injunction is a mode of:

a. Securing the specific performance of the negative terms of a contract.
b. Securing the performance of the contract in positive terms of a contract.
c. Securing the performance of the contract.
d. None of the above.

Q.10:- The person who promises to make good the loss is called the:
a. Creditor
b. Surety
c. Indemnified
d. Indemnifier

Q.11:- A contract of indemnity may be called as:

a. Quasi contracts
b. Contingent contracts
c. Good contracts
d. None of the above.

Q.12:- A contract to perform the promise, or discharge the liability of a third person in
case of his default is called as:
a. Contract of guarantee
 b. Contract of agency
c. Contract of bailment
d. Contract of indemnity
Q.13:- In a contract of indemnity there are:
a. Two parties
b. Three parties
c. Four parties
d. None of the above

Q.14:- In a contract of guarantee there are:

a. Two parties
b. Three parties
c. Four parties
d. None of the above

Q.15:- The person in respect of whose default the guarantee is given is called:
a. The creditor
b. The surety
c. The principal debtor
d. None of the above

Q.16:- On whose request the surety should give the guarantee:

a. At the request of the principal
b. At the request of the banker
c. At the request of the debtor
d. At the request of the creditor

Q.17:- The person who given the guarantee is called:

a. Surety
b. Creditor
c. Principal Debtor
d. None of the above

Q.18:- A contract by which one party promises to save the other from loss caused to him
by the conduct of the promisor himself, or by the conduct of any other person, is called
as:
a. Contract of guarantee
b. Contract of agency
c. Contract of bailment
d. Contract of indemnity

Q.19:- The person whose loss is to be made good is called the:

 a. Surety
b. Indemnifier
c. Creditor
d. Indemnified/Indemnity holder

Q.20:- In the contract of indemnity there is/ are:

a. One contract
b. Two contract
c. Three contract
d. Four contract

Q.21:- In the contract of guarantee there is/ are:

a. One contract
b. Two contract
c. Three contract
d. Four contract

Q.22:- The person to whom the guarantee is given is called:

a. The creditor
b. The principal debtor
c. The surety
d. None of the above

Q.23:- A guarantee which extend to a series of transactions is called:

a. Guarantee in series
b. Continuing guarantee
c. Serial guarantee
d. Step by step guarantee

Q.24:- Anything done or any promise made for the benefit of the principal may be to the
surety for giving guarantee:
a. Small consideration
b. Sufficient consideration
c. No consideration
d. Consideration

Q.25:- A surety on discharging the debt due by the principal debtor steps into the shoes
of the:
a. Agent
b. Bankers
c. Creditor
d. Principal
Q.26:- The liability of the surety is co-extensive with that of................ , unless it is
otherwise provided by the contract:
a. The principal worker
b. The principal creditor
c. The principal debtor
d. The principal banker

Q.27:- A surety has the rights against the:

a. The co-sureties
b. The principal debtor
c. The creditor
d. All of the above
e.
Q.28:- What will be the position where by a contract between the creditor and the
principal debtor by which the creditor makes a composition with or promises to give time
to or not sue the principal debtor:
a. It will not affect the surety’s liability.
b. It will not discharge the surety, provided the surety has assented to such transactions.
c. It will discharge the surety.
d. Both B and C are correct.

Q.29:- When can a continuing guarantee may be revoked by the surety:

a. It can be revoked by the surely after the lapse of certain time period.
b. It can be revoked by the surety after the happening of a certain predefined event.
c. It can be revoked by the surety at any time as to future transactions by notice to the
creditor.
d. None of the above.

Q.30:- Where the terms of the contract between the principal debtor and the creditor are
changed/ varied, without the consent of the surety:
a. It will discharge the surety as to transactions subsequent to the variance.
b. It will not discharge the surety for all the transactions subsequent to the variance.
c. It will not discharge the surety for all the transactions done previously.
d. It will discharge the surety for all the transactions done previously.

Q.31:- The surety is discharged if:

a. By any act or omission of the creditor, the legal consequence of which is the discharge of
the principal debtor.
b. There is a contract between the creditor and the principal debtor to release the principal
debtor.
c. Both A and B are correct.
d. None of the above.
Q.32:- What is correct about the Factor:
a. A factor has the authority to receive the price and given a good discharge to the
purchaser.
b. A factor has a general lien on the goods of his principal for a general balance of account
between his and the principal.
c. A factor is a mercantile agent entrusted with the possession of goods for the purpose of
selling them.
d. All of the above.

Q.33:- What is duty of Principal:

a. Compensation to agent for injury caused by principal’s neglect.
b. Agent to be indemnified against consequences of acts done in good faith.
c. Agent to be indemnified against consequences of lawful acts.
d. All of the above.

Q.34:- How the agency can be created:

a. By ratification
b. By express or implied agreement
c. Be operation of law
d. All of the above.

Q.35:- Ratification of unauthorised act of a person can be ratified by the Principal:

a. In part
b. In full
c. Substantial portion
d. Only some portion

Q.36:- Who may employ agent:

a. Unsound mind
b. Minor
c. Lunatic
d. Major

Q.37:- A person employed to do any act for another, or to represent another in dealings
with third persons is called:
a. Agent
b. Bailee
c. Bailor
d. Principal

Q.38:- Contract of Agency requires:

a. Adequate consideration is required
 b. Consideration
c. Some consideration is required
d. No consideration is required

Q.39:- In an emergency, an agent has authority to do:

a. All such acts which a person of ordinary prudence, in his own case do under similar
circumstances.
b. All such acts for the purpose of protecting his principal form loss.
c. All such acts for the purpose of earning his own interest.
d. Only A and B are correct.

Q.40:- An agency cannot lawfully employ another to perform acts which he has expressly
or impliedly undertaken to perform................. :
a. Personally
b. Officially
c. Arbitrarily
d. None of the above.

Q.41:- An agent having an authority to do an act has authority to do:

a. Everything which is at the discretion of the agent.
b. Everything which is profitable in his opinion.
c. An agent having an authority to do an act has authority to do:
d. Everything in which has its own interest.

Q.42:- Where acts are done by one person on behalf of another, but without his
knowledge or authority:
a. After ratification, he will be liable for all the acts done by such person(agent)
b. He may elect to ratify.
c. He may disown such acts
d. All of the above.

Q.43:- A sub-agent is a person employed bf and acting under the control of:
a. The Principal
b. The employee of the Original Agent
c. The employee of the Principal
d. The Original Agent

Q.44:- An agency may be terminated:

a. By the business of the agency being completed.
b. By the Agency renouncing the business of the agency
c. By the Principal revoking his authority.
d. All of the above.
Q.45:- When an agent, holding and express or implied authority to name another person
to act for the principal in the business of the agency, has named another person
accordingly, such person is:
a. An agent of the principal for such part of the business of the agency as in entrusted to
him.
b. A sub-agent of the original agent.
c. A sub-agent of the principal.
d. Peer agent of the original agent.

Q.46:- Whatever a person can do personally, he can do through:

a. An employee
b. An agent
c. A servant
d. A labour

Q.47:- As between the principal and third persons who may be an agent:
a. Any person may become an agent.
b. Only the person having sound mind can become the agent.
c. Only the person of the age of majority can become the agent.
d. Both B and C are correct.

Q.48:- An agent who in consideration of an extra commission, guarantees his principal

that the persons with whom he enters into contract on behalf of the principal, shall
perform their obligations:
a. Del credere agent
b. Broker
c. Mercantile agent
d. Special agent

Q.49:- What is the position where one person employs another to do an act which is
criminal:
a. The employer is not liable
b. The employer is not liable nor indemnify him against the consequences of such criminal
act.
c. The employer should indemnify
d. The employer is liable
Q.50:- What are the duties of an agent:
a. To use all reasonable diligence in communicating with his principal and in seeking to
obtain his instructions.
b. To pay the sums received for principal
c. To render proper accounts to his principal on demand.
d. d.All of the above.