Master Contract Termination: Discharge of Contracts for Law Students

Question 1

What is the primary legal consequence of a breach of contract?

Accepted Answer

Entitlement of the non-breaching party to seek compensation for damages

Answer

Release of the non-breaching party from their obligations

Answer

Automatic nullification of the contract

Answer

No legal repercussions

Question 2

Which of the following is NOT a valid ground for contract frustration?

Accepted Answer

Mutual agreement to terminate

Answer

Subsequent impossibility of performance

Answer

Unforeseen change in circumstances

Answer

Illegality of the contract's purpose

Question 3

Distinguish between actual and tender of performance in contract law.

Accepted Answer

Actual performance signifies completion while tender of performance merely expresses an intent to complete

Answer

Actual performance must be flawless whereas tender of performance can include imperfections

Answer

Actual performance concludes the contract while tender does not

Answer

There is no distinction between actual and tender of performance

Question 4

What is the impact of a waiver of performance in a contract?

Accepted Answer

Contract discharge

Answer

Entitlement to compensation for damages

Answer

Nullification of the contract

Answer

No legal effect

Question 5

Which of the following is not a type of illegality that can result in contract discharge?

Accepted Answer

Mutual mistake of fact

Answer

Contravention of statutes

Answer

Violation of common law principles

Answer

Contravention of public policy

Question 6

What is the primary effect of contract frustration?

Accepted Answer

Contract discharge

Answer

Entitlement to compensation for damages

Answer

Nullification of the contract

Answer

No legal effect

Question 7

Which of the following is a valid ground for discharging a contract by frustration?

Accepted Answer

Unforeseen changes in circumstances that make performance impossible

Answer

Subsequent illegality of the contract

Answer

Material breach of contract by one party

Answer

Mistake made by one party during contract formation

Question 8

When a contract becomes illegal:

Accepted Answer

It is automatically void from the moment of illegality

Answer

It is only void if the parties were aware of the illegality at the time of contracting

Answer

It is void only if the illegality is of a serious nature

Answer

It is not affected unless the illegality is related to a criminal offense

Question 9

When a party to a contract makes a proper tender of performance, the other party must:

Accepted Answer

Accept the performance without conditions

Answer

Accept the performance only if it is substantially complete

Answer

Reject the performance if it is not perfect in every respect

Answer

Negotiate the terms of acceptance with the party making the tender

Question 10

Which of the following is NOT a factor that courts consider when determining whether a contract has been frustrated?

Accepted Answer

The financial cost of performing the contract despite the change in circumstances

Answer

The extent to which the parties foresaw or could have foreseen the change in circumstances

Answer

The commercial purpose and objectives of the contract

Answer

The relative hardship caused to each party by the change in circumstances

Question 11

When a contract is discharged by breach, the innocent party is entitled to:

Accepted Answer

All of the above remedies

Answer

Damages to compensate for losses suffered

Answer

Specific performance, requiring the breaching party to fulfill their obligations

Answer

Rescission of the contract, returning the parties to their pre-contract positions

Question 12

Which situation constitutes anticipatory breach as repudiatory breach?

Accepted Answer

When the breaching party clearly expresses an intent to not fulfill their contractual obligations

Answer

When the non-breaching party rescinds the contract

Answer

When the non-breaching party affirms the contract

Answer

When contract performance becomes legally or practically impossible

Question 13

Which of the following is not a recognized method of discharging a contract?

Accepted Answer

Repudiation

Answer

Performance

Answer

Agreement

Answer

Frustration

Question 14

When a contract is discharged by performance, the obligations under the contract are:

Accepted Answer

Terminated

Answer

Suspended

Answer

Transferred

Answer

Varied

Question 15

In which of the following circumstances will a breach of contract not discharge the innocent party's obligations?

Accepted Answer

Minor breach

Answer

Material breach

Answer

Anticipatory breach

Answer

Fundamental breach

Question 16

A contract can be discharged by agreement even if one party does not receive consideration in return. True or False?

Accepted Answer

True

Answer

False

Question 17

Which of the following factors is not relevant in determining whether a breach of contract is material?

Accepted Answer

Intentions of the parties

Answer

Nature of the contract

Answer

Extent of the breach

Answer

Commercial purpose of the contract

Question 18

When a contract is discharged by performance, the parties have:

Accepted Answer

Fulfilled their obligations

Answer

Breached their obligations

Answer

Mutually agreed to terminate the contract

Answer

Been frustrated in their performance

Question 19

Frustration of a contract occurs when:

Accepted Answer

Performance becomes objectively impossible or radically different

Answer

One party breaches the contract

Answer

The parties mutually agree to terminate the contract

Answer

The contract is illegal

Question 20

Discharge by performance is an:

Accepted Answer

Automatic process

Answer

Discretionary process

Answer

Negotiated process

Answer

Adjudicatory process

Question 21

Which of the following best defines 'illegality' in the context of contract discharge?

Accepted Answer

A contract that violates a law or legal principle

Answer

A contract that goes against public policy

Answer

A contract that is considered immoral

Answer

A contract that harms a third party

Question 22

Which of the following is not a recognized method for discharging a contract?

Accepted Answer

Expiration

Answer

Performance

Answer

Mutual agreement

Answer

Frustration

Question 23

When can a contract be discharged by frustration?

Accepted Answer

When an unforeseen event makes performance impossible or radically different from what was agreed upon.

Answer

When an unforeseen event makes performance more difficult or expensive.

Answer

When one party becomes bankrupt.

Answer

When one party breaches the contract.

Question 24

When a contract is discharged by performance, what is the legal status of the parties involved?

Accepted Answer

Both parties are released from their obligations and have no further rights under the contract.

Answer

The parties retain their rights but are no longer bound by their obligations.

Answer

The parties remain bound by their obligations but lose their rights.

Question 25

What is the essential element for a tender of performance to be legally valid?

Accepted Answer

Clear intent to fulfill contractual obligations

Answer

Complete and precise fulfillment of all contract terms

Answer

Acceptance and acknowledgment from the receiving party

Answer

Provision of consideration to the other contracting party

Question 26

When a contract is discharged due to frustration, what are the legal repercussions?

Accepted Answer

Both parties are released from their obligations, but the party not at fault may receive compensation.

Answer

Both parties are released from their obligations, and no compensation is awarded.

Answer

The contract is considered void from its inception.

Answer

The parties must continue to fulfill their obligations as if the contract had not been discharged.

Question 27

Which of the following is **not** a valid method of discharging a contract?

Accepted Answer

Revocation

Answer

Agreement

Answer

Performance

Question 28

When can a contract be discharged by frustration?

Accepted Answer

When an unforeseen event renders performance impossible, illegal, or radically different.

Answer

When one party fails to perform their obligations.

Answer

When the parties mutually agree to terminate the contract.

Question 29

When is an anticipatory breach actionable?

Accepted Answer

When the party in breach communicates their clear intention not to perform.

Answer

When the contract is for the sale of goods.

Answer

When the other party incurs financial loss as a result of the breach.

Question 30

Which of the following is a characteristic of a fundamental breach?

Accepted Answer

It goes to the root of the contract.

Answer

It can be remedied by damages.

Answer

It occurs after the contract has been performed.

Answer

It is trivial and does not affect the parties' performance.

Question 31

When is a contract discharged by agreement?

Accepted Answer

When the parties to the contract mutually consent to end it.

Answer

When one party performs their obligations under the contract.

Answer

When the contract is frustrated due to an unforeseen event.

Question 32

Which of the following cannot lead to the frustration of a contract?

Accepted Answer

A change in market conditions.

Answer

An act or omission of one of the parties.

Answer

An unforeseen event.

Answer

A change in the law.

Question 33

When can a contract be discharged by rescission?

Accepted Answer

When the parties agree to cancel the contract and restore each other to their pre-contract positions.

Answer

When one party breaches the contract.

Question 34

When can a contract be discharged by illegality?

Accepted Answer

When the contract's purpose is prohibited by law or contrary to public policy.

Answer

When one party performs their obligations under the contract.

Answer

When the contract is frustrated due to an unforeseen event.

Question 35

Which of the following is NOT a method of discharging a contract?

Accepted Answer

Misrepresentation

Answer

Agreement

Answer

Performance

Answer

Frustration

Question 36

When a contract is discharged by performance, both parties have:

Accepted Answer

Fulfilled all their obligations

Answer

Breached their obligations

Answer

Agreed to terminate the contract

Answer

Been frustrated by an unforeseen event

Question 37

Which of the following is a defense to a claim for breach of contract based on frustration?

Accepted Answer

Self-induced frustration

Answer

Change in law

Answer

Unforeseen circumstances

Answer

Force majeure

Question 38

Which of the following is a consequence of a contract being discharged by breach?

Accepted Answer

The innocent party may claim damages

Answer

The parties remain bound by their obligations

Answer

The contract is automatically terminated

Question 39

When a contract becomes illegal to perform, it is discharged by:

Accepted Answer

Frustration

Answer

Breach

Answer

Agreement

Answer

Performance

Question 40

Which of the following is NOT a requirement for the doctrine of frustration to apply?

Accepted Answer

The frustrating event must be foreseeable

Answer

The frustrating event must render the contract impossible to perform

Answer

The frustrating event must substantially change the nature of the contract

Answer

The frustrating event must occur without the fault of either party

Question 41

When a contract is discharged by novation, the existing contract is:

Accepted Answer

Replaced by a new contract

Answer

Varied to reflect the new circumstances

Answer

Terminated without any further obligation

Question 42

When a contract is discharged by frustration, the parties are:

Accepted Answer

Excused from further performance

Answer

Entitled to damages

Answer

Bound to complete the contract despite the frustrating event

Answer

Required to renegotiate the contract