Formation of Contracts: Essential Elements and Types

Question 1

A contract in which one party promises to do something in exchange for an act by the other party is known as a:

Accepted Answer

Bilateral contract

Answer

Express contract

Answer

Unilateral contract

Answer

Implied contract

Question 2

An offer must be communicated to the offeree to be legally effective. True or False?

Accepted Answer

True

Answer

False

Question 3

Minors (under the age of 18) have full capacity to enter into legally binding contracts. True or False?

Accepted Answer

False

Answer

True

Question 4

A false statement made by one party to a contract that induces the other party to enter into the contract may constitute:

Accepted Answer

Misrepresentation

Answer

Mistake

Answer

Duress

Answer

Undue influence

Question 5

A contract that is entered into under the influence of force or threats is considered:

Accepted Answer

Voidable

Answer

Void

Answer

Unenforceable

Answer

Valid

Question 6

Which of the following is NOT a type of consideration?

Accepted Answer

Adequacy

Answer

Money

Answer

Services

Answer

Promises

Question 7

Intention to create legal relations is a requirement for:

Accepted Answer

All legally binding contracts

Answer

Only commercial contracts

Answer

Only social agreements

Answer

Domestic agreements

Question 8

Which of the following is NOT a vitiating factor?

Accepted Answer

Breach of contract

Answer

Mistake

Answer

Misrepresentation

Answer

Undue influence

Question 9

A term of a contract that is implied by law is called a:

Accepted Answer

Implied term

Answer

Express term

Answer

Incorporated term

Answer

Parol term

Question 10

Which of the following is NOT a defence to a breach of contract?

Accepted Answer

Contributory negligence

Answer

Frustration

Answer

Force majeure

Answer

Illegality

Question 11

Under English contract law, consideration refers to:

Accepted Answer

Something of value promised or given in exchange for a promise.

Answer

A moral obligation arising from a previous agreement.

Answer

The payment of money or goods in return for a service.

Answer

The benefit one party receives from the other party's performance.

Question 12

What is the primary consequence of a misrepresentation in a contract?

Accepted Answer

It gives the innocent party the right to rescind the contract.

Answer

It automatically voids the contract.

Answer

It gives the court discretion to enforce or set aside the contract.

Answer

It has no effect on the validity of the contract.

Question 13

An invitation to treat differs from an offer in that:

Accepted Answer

An offer is a legally binding commitment, while an invitation to treat is not.

Answer

An invitation to treat is a firm offer, while an offer is not.

Answer

There is no legal distinction between an invitation to treat and an offer.

Answer

An invitation to treat is a unilateral offer, while an offer is a bilateral offer.

Question 14

What is the legal effect of making a counter-offer?

Accepted Answer

It terminates the original offer.

Answer

It modifies the terms of the original offer.

Answer

It has no effect on the original offer.

Answer

It creates a new offer.

Question 15

Which of the following is NOT a recognized vitiating factor that can invalidate a contract?

Accepted Answer

Good faith

Answer

Misrepresentation

Answer

Mistake

Answer

Duress

Question 16

Which of the following is NOT an essential element of a legally binding contract?

Accepted Answer

Formal signature

Answer

Offer

Answer

Consideration

Answer

Acceptance

Question 17

An offer can be revoked before it is accepted, provided that:

Accepted Answer

Communication of revocation reaches the person to whom the offer was made.

Answer

The person to whom the offer was made requests revocation.

Answer

The person who made the offer changes their mind.

Answer

A reasonable time has passed since the offer was made.

Question 18

What is the legal term for the process of returning goods and money after a contract has been rescinded?

Accepted Answer

Restitution

Answer

Abrogation

Answer

Reformation

Answer

Rectification

Question 19

Which type of contract is enforceable by a specific legal action known as an action in covenant?

Accepted Answer

Contract under seal

Answer

Simple contract

Answer

Oral contract

Answer

Written contract

Question 20

Which of the following is NOT a requirement for consideration to be legally valid?

Accepted Answer

Must be in writing

Answer

Must be sufficient

Answer

Must be legal

Answer

Must be of some value

Question 21

Which of the following can make a contract void?

Accepted Answer

Lack of capacity

Answer

Agreement to vary terms

Answer

Change in circumstances

Answer

Minor technical error

Question 22

Which of the following types of contracts does NOT require a written form?

Accepted Answer

Simple contract

Answer

Contract under seal

Answer

Deed

Answer

Specialty contract