Terms of Contracts: Master the Legal Significance and Enforceability

Question 1

Which of the following is a condition in a contract?

Accepted Answer

A term that goes to the root of the contract

Answer

A term that is not essential to the contract

Answer

A term that is only breached if another term is breached

Answer

A term that is implied by statute

Question 2

What is the difference between an express warranty and an implied warranty in a contract?

Accepted Answer

Express warranties are created by the parties, while implied warranties are imposed by law.

Answer

Implied warranties are created by the parties, while express warranties are imposed by law.

Answer

Express warranties are always more important than implied warranties.

Answer

Implied warranties are always more important than express warranties.

Question 3

What is the doctrine of incorporation by reference?

Accepted Answer

A term of a contract can be incorporated into the contract by reference to another document.

Answer

A term of a contract must be expressly stated in the contract to be binding.

Answer

A term of a contract can only be incorporated by reference if it is in writing.

Answer

A term of a contract cannot be incorporated by reference if it is in writing.

Question 4

What is the difference between a term and a representation in a contract?

Accepted Answer

A term is binding on the parties, while a representation is not.

Answer

A representation is binding on the parties, while a term is not.

Answer

A term is always express, while a representation can be express or implied.

Answer

A representation is always express, while a term can be express or implied.

Question 5

Which of the following is NOT a type of express term used in forming a contract?

Accepted Answer

Implied terms

Answer

Written terms

Answer

Verbal terms

Answer

Customary terms

Question 6

A term that requires a party to act in a specific manner is referred to as:

Accepted Answer

A promissory term

Answer

A representation

Answer

A collateral warranty

Answer

A condition precedent

Question 7

Which of the following is NOT a category of terms in a contract?

Accepted Answer

Suggested terms

Answer

Express terms

Answer

Implied terms

Answer

Incorporated terms

Question 8

Which requirement is NOT necessary for an implied term to be legally enforceable?

Accepted Answer

It must be agreed upon by both parties

Answer

It must be reasonable and necessary

Answer

It must not contradict any express terms

Answer

It must be capable of being performed

Question 9

Which of the following is not a characteristic of an express term?

Accepted Answer

Automatically implied by law or custom

Answer

Agreed upon by both parties

Answer

Incorporated into a contract in writing or orally

Answer

Legally binding

Question 10

Implied terms are terms that:

Accepted Answer

Are automatically incorporated into a contract by operation of law or custom

Answer

Are explicitly stated in the contract

Answer

Can only be included in written contracts

Answer

Are not legally enforceable

Question 11

Which of the following statements about an express warranty is accurate?

Accepted Answer

It is created by the parties to a contract

Answer

It is automatically implied by law

Answer

It is less important than an implied warranty

Answer

It is only applicable to written contracts

Question 12

What is the purpose of the Limitation Act 1980?

Accepted Answer

To establish time limits for bringing legal claims

Answer

To provide a defense against claims that are filed too late

Answer

To create a new cause of action for breach of contract

Answer

To abolish the common law rules on limitation of actions

Question 13

Which of the following is NOT an essential characteristic of an express term in a contract?

Accepted Answer

Incorporated into the contract by operation of law

Answer

Agreed upon by the parties

Answer

Stated explicitly or in writing in the contract document

Answer

Legally binding on the parties

Question 14

Which type of warranty is implied in a contract for the sale of goods that ensures the goods are fit for their intended purpose?

Accepted Answer

Warranty of fitness for a particular purpose

Answer

Warranty of merchantability

Answer

Warranty of title

Answer

Warranty of non-infringement

Question 15

In standard form contracts, what is the main purpose of exclusion and limitation clauses?

Accepted Answer

To limit the liability of the party creating the contract

Answer

To protect third parties from liability

Answer

To make sure the contract is fair for both parties

Question 16

Which of the following is NOT a characteristic of an express term in a contract?

Accepted Answer

Implied by law or custom

Answer

Agreed upon by the parties to the contract

Answer

Incorporated into the contract by reference

Answer

Enforceable by a court of law

Question 17

What is the fundamental difference between an express term and an implied term?

Accepted Answer

An express term is stated explicitly, while an implied term is inferred from the contract's context.

Answer

An implied term is more important than an express term.

Answer

An express term can be varied by the parties, while an implied term cannot.

Question 18

Which of the following is an example of an implied-in-fact term?

Accepted Answer

A term that the parties would have included if they had considered it when forming the contract.

Answer

A term that is imposed by statute.

Answer

A term that is implied by custom or usage.

Question 19

What are the potential consequences of a breach of condition in English Contract Law?

Accepted Answer

The innocent party has the right to terminate the contract and claim damages.

Answer

The innocent party has the right to terminate the contract but cannot claim damages.

Answer

The innocent party cannot terminate the contract but can claim damages.

Question 20

What is the primary distinction between a warranty and a condition?

Accepted Answer

A condition is a fundamental term, while a warranty is a less important term.

Answer

A warranty is more important than a condition.

Answer

Conditions can be implied, while warranties cannot.

Question 21

What is the purpose of a liquidated damages clause?

Accepted Answer

To specify an agreed-upon amount of damages payable in the event of a breach.

Answer

To prevent the innocent party from claiming damages.

Answer

To give the party in breach an option to avoid paying damages.

Question 22

A breach of which type of condition gives the innocent party the right to terminate the contract?

Accepted Answer

Condition

Answer

Term

Answer

Warranty

Question 23

The doctrine of frustration applies when:

Accepted Answer

An unforeseen event makes the performance of the contract impossible or radically different

Answer

The contract is entered into under duress

Answer

One party fails to perform their obligations

Question 24

The Unfair Contract Terms Act 1977 primarily aims to protect consumers from:

Accepted Answer

Unfair terms in standard form contracts

Answer

Economic loss

Answer

Breaches of contract

Answer

Misrepresentations

Question 25

Which of the following elements is essential for the formation of a binding contract?

Accepted Answer

Offer, acceptance, consideration, capacity, and legality

Answer

Mutual assent

Answer

Intention to create legal relations

Question 26

Which of the following is NOT a characteristic of an express term in a contract?

Accepted Answer

It is implied by law or custom.

Answer

It can be oral or written.

Answer

It is agreed upon by the parties to the contract.

Question 27

In which of the following scenarios would an implied term be automatically incorporated into a contract?

Accepted Answer

When it is necessary to give the contract business efficacy.

Answer

When it is specifically excluded by the parties.

Answer

When it contradicts an express term.

Question 28

Which of the following actions constitutes a breach of contract?

Accepted Answer

Failure by one party to fulfill their contractual obligations.

Answer

Interference in the contract by an external party.

Answer

Mutual agreement to terminate the contract.

Question 29

Which of the following factors is NOT considered in the interpretation of a contract?

Accepted Answer

The subjective intentions of the parties involved.

Answer

The context within which the contract was formed.

Answer

The plain meaning of the language used.

Answer

The surrounding circumstances at the time of contracting.

Question 30

Which of the following statements accurately describes the parol evidence rule?

Accepted Answer

It prohibits the introduction of extrinsic evidence that contradicts the terms of a written contract.

Answer

It applies exclusively to contracts that are made orally.

Answer

It allows for the admission of all relevant extrinsic evidence in the interpretation of a contract.

Question 31

Which of the following is NOT a category of exemption clause?

Accepted Answer

Implied exemption clause

Answer

Exclusion clause

Answer

Limitation clause

Answer

Indemnity clause