Contract law worksheet with answers

A counter-offer has which effect on the original offer?

1. AIt has no effect at all
2. BIt accepts the original offer
3. CIt rejects and ends the original offer
4. DIt makes the original offer irrevocable

Rescission of a contract means:

1. ACorrecting the wording of a written contract
2. BOrdering a party to perform as promised
3. CSetting the contract aside so the parties return to their original positions
4. DEnding the contract for the future only and claiming damages for lost profits

In English law, a term whose breach allows termination only if the consequences are serious is called:

1. AAn innominate (intermediate) term
2. BA representation
3. CA condition
4. DA warranty

A seller of land never used for sheep says it could carry 2,000 sheep. Both know he has no experience of sheep farming on it. The statement is most likely:

1. AAn honest opinion, not a misrepresentation
2. BA condition of the contract
3. CA fraudulent misrepresentation
4. DA statement of future intention

Under the Law Reform (Frustrated Contracts) Act 1943, money paid before a frustrating event is generally:

1. ALost, because the loss must lie where it falls once the contract is frustrated
2. BPaid into court for distribution
3. CPayable twice, as a penalty
4. DRecoverable, though the court may let the payee keep some for expenses

A holiday company provides a holiday far below the promised standard. Can the customer recover damages for disappointment?

1. AYes, because the contract's purpose was to provide enjoyment
2. BOnly if the customer suffered a physical injury
3. COnly if the company acted dishonestly
4. DNo, because mental distress is never recoverable in contract

An employer pays large severance sums to two directors, later discovering it could have dismissed them for nothing because of their earlier misconduct. In Bell v Lever Bros, the agreements were:

1. AVoidable for the directors' misrepresentation by failing to disclose their misconduct
2. BValid, because the mistake about quality was not fundamental enough
3. CUnenforceable because severance needs a deed
4. DVoid for common mistake about the contracts

In Great Peace Shipping v Tsavliris Salvage, the Court of Appeal held that a contract is void for common mistake only if the mistake makes performance:

1. AImpossible or essentially different from what the parties agreed
2. BDifferent from the contract in a minor detail
3. CCommercially less attractive for one party
4. DMore expensive to carry out than both parties had expected when contracting