Multiple Choice Questions:
1. If a contract contains an undertaking to perform an impossibility, the contract is — ~
(a) void ab initio. (b) void.
(c) voidable at the option of the plaintiff. (d) illegal.
Ans: (a) void ab initio.
2. An agreement to do an act impossible in itself — ~
(a) is void. (b) is voidable.
(c) is void ab initio. (d) becomes void when impossibility is discovered.
Ans: (a) is void
3. If a new contract is substituted in place of an existing contract, it is called—
(a) alteration. (b) rescission.
(c) novation. (d) waiver.
Ans: (c) novation.
4. The Case of Taylor v. Caldwell, (1883) 3 B. & S. 826 deals with—
(a) discharge of contract by destruction of subject matter. (b) anticipatory breach of contract.
(c) discharge of contract by death of a party. (d) breach of contract.
Ans: (a) discharge of contract by destruction of subject matter.
5. A lends ₹500 to B. He later tells B that he need not repay the amount, the contract is discharged by
(a) breach. (b) waiver. (c) novation. (d) performance.
Ans: (b) waiver.
6. A contract has become more difficult of performance due to some uncontemplated events or delays. The contract—
(a) is discharged. (b) is not discharged. (c) becomes void. (d) becomes voidable.
Ans: (b) is not discharged.
7. Where a contract could not be performed because of the default by a third person on whose work the promisor relied, it—
(a) is not discharged. (b) is discharged. (c) becomes void. (d) becomes voidable.
Ans: (a) is not discharged.
8. A creditor agrees with his debtor and a third party to accept that third party as his debtor. The contract is discharged by — ~
(a) performance. (b) alteration. (c) waiver. (d) remission.
Ans: (c) waiver.
9. The case of Satyabrata Ghose v. Mugneeram Bangur & Co., (1954) S.C. 44 deals with —
(a) agreement opposed to public policy. (b) supervening impossibility.
(c) contracts of guarantee. (d) agency.
Ans: (a) agreement opposed to public policy.
10. A undertakes to paint a picture of B. He dies before he paints the picture. The contract —
(a) is discharged by death.
(b) becomes voidable at the option of B.
(c) becomes voidable at the option of the legal representatives of A.
(d) will have to be performed by the legal representatives of A.
Ans: (a) is discharged by death.
True or False Questions:
1. If only one party to a contract performs his promise, the contract is discharged. [False]
2. In case of novation if for any reason the new contract cannot be enforced, the parties can fall back upon the old contract. [True]
3. Supervening impossibility is an excuse for the non-performance of a contract in all cases. [False]
4. If there is any change in the state of things which formed the basis of a contract, the contract is discharged. [True]
5. Strikes, lock-outs and civil disturbances do not discharge a contract. [True]
6. In case of anticipatory breach, the promisee has to wait till the time the act was to be done to take legal action for breach of contract. [False]
7. Where at the time of making a contract both the parties are ignorant of the destruction of subject matter, the contract is void on the ground of mutual mistake. [True]
8. In case of post-contractual impossibility, the contract becomes voidable when impossibility arises. [False]
9. When all or some of the terms of a contract are altered, rescission takes place. [False]
10. Novation means substitution of a new contract for an old one. [True]
11. Outbreak of war is not an excuse for non-performance of a contract. [False]