Question 1

A 'condition' is:

Accepted Answer

A 'condition' is a term of the contract that is of fundamental importance, and its breach allows the aggrieved party to terminate the contract and seek damages.

Question 2

Alexei verbally orders a birthday cake from Ng's bakery.Alexei orders it for 'the 3rd of the month' but Alexei meant the following month and Ng thought Alexei meant this month.Which of the following is the best answer?

Accepted Answer

This situation is a mutual mistake because both parties have a misunderstanding about a basic assumption on which the contract was made (the date of delivery). This misunderstanding can lead to the contract being considered void because the parties never truly agreed on the same terms.

Question 3

'Quantum meruit' is:

Accepted Answer

Quantum meruit refers to the payment for work done or services rendered when a contract does not specify a price, or when a contract is only partially completed. It allows a party to recover the reasonable value of the work performed.

Question 4

Niko orders a steak in a restaurant.When the waiter returns, he regretfully informs Niko that there is no more steak.Instead, he offers Niko a lamb chop.Niko accepts as he is hungry and does not want to make a fuss.At the end of the meal, he refuses to pay the bill, claiming that the restaurant was in breach of its contract to serve him the steak that he ordered.Which is correct?

Accepted Answer

Niko accepted the restaurant's offer of a lamb chop instead of steak, which means he has entered into a new agreement with the restaurant. Therefore, he has no legal remedy to refuse to pay the bill.

Question 5

Which of the following statements is not true of 'indirect loss' arising from a breach of contract?

Accepted Answer

Indirect loss, also known as consequential loss, does not flow naturally from the breach according to the ordinary course of events. Instead, it refers to losses that occur as a consequence of special circumstances beyond the direct impact of the breach.

Question 6

In breach of her contract with Leaverpond Rovers football team, Assistant Manager Leah publishes an autobiography revealing the secret coaching methods of Team Manager Wafael.What type of remedy is Leaverpond Rovers least likely to seek?

Accepted Answer

The answer of In breach of her contract with Leaverpond...

Question 7

'Liquidated damages' are:

Accepted Answer

Liquidated damages are a pre-estimate of the amount of damages that one party will be entitled to if the other party breaches the contract. They are agreed upon in advance and specified in the contract.

Question 8

'Exemplary damages' are:

Accepted Answer

Exemplary damages, also known as punitive damages, are awarded to punish the defendant for particularly egregious or malicious conduct and to deter similar conduct in the future.

Question 9

'Nominal damages' are:

Accepted Answer

Nominal damages are awarded when a legal wrong has occurred, but the plaintiff has not suffered any actual, quantifiable loss.

Question 10

Benjamin is contracted to advertise exclusively for the fashion brand, Racoz.In breach of his contract, he fronts various advertising campaigns for rival brand Polar Laugh Raulen.Racoz sues Benjamin for breach of contract, seeking an injunction.The request by Racoz will not be granted if:

Accepted Answer

An injunction is an equitable remedy, and courts may deny it if the party seeking it has acted unfairly or unconscionably, as equity requires clean hands.

Question 11

Which of the following contracts is least likely to be void or voidable due to lack of consent?

Accepted Answer

Cameron convincing Kris to sign a contract after six hours of exhausting negotiations is least likely to be considered void or voidable due to lack of consent. While the negotiations were lengthy, there is no indication of undue influence, duress, or incapacity, which are common grounds for a contract to be considered void or voidable.

Question 12

Christian agrees to sell five hundred footballs to Anderson.However, Anderson subsequently refuses to accept the footballs.Which of the following is not one of the statutory remedies available to Christian?

Accepted Answer

An order for specific performance is generally not available for the sale of goods unless the goods are unique or extraordinary, which is typically not the case with items like footballs.

Question 13

In which of the following circumstances will an injunction not be granted?

Accepted Answer

An injunction will not be granted if an award of damages would be adequate. This is because an injunction is a discretionary remedy and a court will not order it if it is not necessary to prevent irreparable harm or damage. If damages can compensate for the harm caused by the breach, an injunction is not necessary.

Question 14

The Australian Consumer Law prohibits unfair terms in:

Accepted Answer

The Australian Consumer Law specifically targets unfair terms in consumer contracts that are standard form contracts, ensuring fairness and protection for consumers.

Question 15

'Rescission' is:

Accepted Answer

Rescission refers to the cancellation of a contract, with the aim of restoring the parties involved to the positions they were in before the contract was made.

Question 16

An 'intermediate term' is:

Accepted Answer

An 'intermediate term' is one that cannot be clearly categorized as either a fundamental term or a minor term, and its breach may or may not allow for contract termination depending on the severity of the breach.

Question 17

Kenneth enters into a contact to purchase a watch from Cole.Cole then breaches the contract by refusing to hand over the watch to Kenneth.Which of the following is the most likely circumstance in which an order for specific performance will be granted?

Accepted Answer

Specific performance is usually only granted when the subject matter of the contract is unique or rare, such as handmade or one-of-a-kind items like a unique watch.

Question 18

Damages awarded to a plaintiff in an amount above and beyond mere compensation, and intended by the court to penalise or punish the defendant, are called:

Accepted Answer

Exemplary damages, also known as punitive damages, are awarded to punish the defendant for egregious conduct and to deter similar actions in the future.

Question 19

Which of the following circumstances will not give rise to an entitlement on the part of a plaintiff to damages?

Accepted Answer

An innocent misrepresentation does not typically entitle the plaintiff to damages, although it may allow for rescission of the contract.

Question 20

In what circumstances will a court refuse to grant an order for specific performance?

Accepted Answer

A court may refuse to grant an order for specific performance if the plaintiff has acted unfairly or unconscionably. This can include situations where the plaintiff has engaged in fraud or misrepresentation, or where enforcing the contract would be against public policy. Additionally, specific performance may be refused if it would be impractical or impossible to enforce, or if it would cause undue hardship to one or both parties involved. However, a breach of contract by the defendant is typically not a reason to refuse an order for specific performance, as this is one of the situations where such an order is most commonly sought. It is also not relevant whether the breach involves unique goods, as specific performance can be sought for any type of contract. Additionally, the availability of damages as a remedy is not necessarily a deciding factor, as some contracts may be better suited to specific performance, even if damages are available.

Quiz 9: Contract Law 3: Enforcement of the Contract