CBSE Questions for Class 11 Commerce Legal Studies Classification Of Law Quiz 1 - MCQExams.com

Legal Principle : A minor is not competent to enter into a contract and the law will assume that the contract never happened and everything is returned to as it was.
Factual Situation : P rendered services to D during his minority at D's request, which were continued after D ceased to be a minor. After attaining majority, D promised to pay an annuity to P for the services rendered in the past.
Issue: What is the nature of the contract and whether P can recover the money ? 
  • It was a good contract and P can recover the money.
  • It was not a valid contract because the contract with the minor is void ab initio.
  • It is voidable contract at the option of the minor.
  • None of these
Legal Principle: Whoever intending to take dishonestly any movable property out of the possession of any person without that person's consent, moves that property in, is said to commit theft. Whoever commits theft, shall be punished with imprisonment which may extend to three years or with fine or with both.
Factual Situation: Raju sees a cell phone belonging to Ram lying on the table in Ram's house. Raju hides the cell phone in Ram's hose is such a place where Ram could not find it ever, due to the fear of immediate search and detection. Raju did this with the intention of taking away the cell phone from the hidden place when Ram forgets about it and then sell it.
Question: Is Raju guilty of theft?
  • Yes
  • No, before he merely played a prank on his friend
  • Yes, because Raju did not inform Ram about the place where he had hidden the cell phone
  • Yes, because Raju intended to take the immovable property from Ram's possession and with this intention he moved the property
According to Indian Majority Act, a major is a person who has attained the age of _______________.
  • $$18$$ years
  • $$21$$ years
  • $$15$$ years
  • $$16$$ years
International Court of Justice is located in ______________.
  • New York
  • London
  • Hague
  • None of these
Ramesh asks his servant to sell his cycle to him at a price less than that of the market price. This contract can be voidable by the servant on the ground of.
  • Fraud
  • Mistake
  • Undue influence
  • Coercion
The display of articles in a showroom indicating their prices amount to ________________.
  • Offer
  • Counter offer
  • Invitation to an offer
  • Mere advertisement
Which one of the following statements is correct?
  • The Right to Private Property was incorporated in the Constitution by the $$42$$nd Amendment
  • The Right to Private Property was granted by the original Constitution but it has since been removed from the list of fundamental rights
  • The Right to Private Property was never a fundamental right, under the Indian Constitution
  • The Right to Private Property which was granted by the original Constitution has been made more sacrosanct by the $$44$$th Amendment
Libel is addressed to the eye; slander to the ear. State which of the following statements are slanderous?
  • Slanderous words uttered by the characters on the dramatic stage
  • Slanderous words uttered by the characters on the cinema screen
  • Abuses recorded in the gramophone disc
  • Both (b) and (c)
Mark the incorrect answer.
The main purpose of the law of contract is?
  • The satisfaction of human desires in the highest practicable degree
  • Where there are conflicting human interest and desires, by establishing a judicial and administrative system that acts with reasonable degree of uniformity
  • To do something in accordance with the norm of prescribed law
  • All of the law
Legal Principle: When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or deck or abstains from doing, or promises to do a to abstain from doing, something, such as or abstinence or promise, is called a consideration for the promise.
Factual Situation : U was  appointed by his father as his successor and put in possession of his entire property. In consideration thereof, U agreed with his father to pay a certain sum of money and to give a village to J, the illegitimate son of his father, on his attaining majority.
Issue : What is the nature of the contract?
  • It is a valid contract. As there was a concrete consideration between U and his father, and if U does not fulfill an condition then J is entitled to sue U.
  • As there is no contract between U and J, J has no claim against U.
  • It is a contract void ab initio because consideration agreed upon is for an illegitimate son which goes against the mortality.
  • it is a invalid contract,
Legal Principle: A contract procured by coercion is bad under Indian Contract Act. Coercion is defined as committing or threatening to commit any act forbidden by the Indian Penal Code. Attempt to commit suicide is an offence under Indian Penal Code.
Factual Situation: A girl of 13, lost her husband and her husband's relatives refused to have the husband's corpse removed unless she adopted one child of their choice. It was held that the adoption was not binding on her as her consent was obtained under coercion within the purview of Section 15, since any person who obstructed a dead body from being removed would be guilty of an offence under Section 297 of the Indian Penal Code.
Issue: Is the adoption valid?
  • No, the adoption is not valid as it was imposed through coercion.
  • The adoption is valid.
  • The adoption is voidable at the option of the girl.
  • The adoption is non voidable at the option of thegirl.
Legal Principle: A minor is not permitted by law to enter into a contract. Hence, where a minor enters into a contract is not enforceable. This effectively means that neither the minor nor the other party can make any claim on the basis of the contract.
Factual Situation : A minor borrowed Rs. 20,000 from B, and as a security for the same executed a mortgage in his favour. He became a major a few months later and filed a suit for declaration that the mortgage executed by him during his minority was void and should be cancelled.
Issue: The agreement is void or valid?
  • The agreement is valid and the minor is not entitled to the repayment of money.
  • A mortgage by a minor was void and B was not entitled to repayment of money.
  • It is at the discretion of the court.
  • None of these.
Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence.Factual Situation: An illiterate woman executed a deed under impression, that she was executing a deed authorizing her nephew to manage her lands, while in fact it was a deed of gift in favour of her nephew.The evidence showed that the woman never intended to execute such a deed of a gift nor was the deed read or explained to her. 
Issue: Is the deed valid and operative?
  • The deed is valid and operative.
  • The deed is not valid and not operative because any contract done under the wrong impression, misrepresentation mistake, undue influence,threat, for or coercion is not a valid contract as per Section 14 of the Indian Contract Act.
  • As Indian Contract Act does not cover such situations so it will be the discretion of the court.
  • The deed is not valid and not operative.
Legal Principle : The act of using influence on another and taking undue advantage of that person is called undue influence.
Factual Situation : A, a moneylender, advances Rs.100 to B, an agriculturist and by undue influence induces to B to execute a bond for Rs.200 with an interest at 6 per cent per month.
Issue : Is it a case of undue influence ?
  • It is not a case of undue influence because it is purely and technically a business it is purely and technically a business deal and the motive of business is to earn profit.
  • It is a case of undue influence because it is a mere exploitation of one's conditions and a clear-cut case of inducement of undue influence.
  • Neither (a) nor (b)
  • Both (a) and (B)
Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence.
Factual Situation: A poor Hindu widow who was in dire need of money, was forced by a moneylender to agree to pay 100 percent rate of interest.
Issue: Is it a case of using undue influence?
  • It is a case of exerting undue influence upon a person of mental distress. Therefore, the contract is not valid and the moneylender cannot plead for the specific performance of the contract.
  • The moneylender can ask for the specific performance of contract as there is no indication of any undue influence because the lady herself had approach the moneylender and voluntarily agreed to pay 100 per cent interest.
  • Neither (a) nor (b)
  • None of these.
Legal Principle: In a contract with a minor, if the other party hands over any money or confers any other benefit on the minor, the same shall not be recoverable from the minor unless the other party was deceived by the minor to hand over the money or any other benefit. The other party will have to show ignorant about the age of the minor and that he handed over the benefit on the basis of such representation.
Factual Situation : X, a minor, insured his goods with an insurance company. The goods with an insurance company. The goods were damaged, X filed a suit for claim. The insurance company took the plea that the person on whose behalf the goods were insured was a minor. The court rejected the plea and allowed the minor to recover the insurance money.
Issue: Will the minor be entitled to recover the insurance money?
  • No, he will not be entitled as he is a minor.
  • He will be entitled though he was a minor at the time he insured his goods with the company. The contract with the minor has been held to be void to protect the interest of the minor but this provision cannot be misused against the interest of the minor.
  • It will be the discretion of the court, as such contracts are not covered by the Indian Contract Act.
  • yes,he will be entitled as he is a minor.
Legal Principle : The act of using influence on another and taking undue advantage of that person is called undue influence. 
Factual Situation : A solicitor sold certain property to one of his clients. The client subsequently alleged that the property was considerably overvalued and his consent was obtained by undue influence.
Issue: Is it a case of imposing undue influence and what is the nature of the contract?
  • The contract is not valid since the relationship of a solicitor and client is of fiduciary nature, the existence of undue influence can be presumed to exist and the client will be entitled to the recovery of property.
  • It is a valid contract because it cannot be presumed that such a learned solicitor can resort to any illegal means.
  • It will be the discretion of the court to decide on the basis of the available evidence and circumstances.
  • It is invalid contract because it cannot be presumed that such a learned solicitor can not resort to any illegal means.
Legal Principle : When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or doe or abstains from doing, or promises to do a to abstain from doing, something, such as or abstinence or promise, is called a consideration for the promise.
Factual Situation: D agreed with P's father that he would pay P Rs. 500 per month as kharch-i-pandan if she marries D's son. The allowance was stopped sometime after the marriage. P used her father-in-law for Rs.1,500 as arrears of allowance.
Issue: Can P sue D and was there any contract between P and D ?
  • Yes, P can use D as there is a valid contract because D had already performed the conditions of a contract.
  • There is no valid contract so P cannot sue D.
  • Neither (a) nor (b)
  • None of these.
Legal Principle : The act of using influence on another and taking undue advantage of the person is called undue influence.
Factual Situation : A, a police officer purchased a property worth Rs. 2 lakhs for Rs.20,000 from B, an accused under his custody. But later on, B wants to cancel the sale on the grounds of undue influence. 
Issue : Is the contract of sale valid ?
  • The contract of sale is valid and B will not be entitled to claim the recovery of land.
  • A, the police officer is in a position to dominate the will of B and the existence of undue influence can be presumed so the contract is not valid and B will be entitled to recovery of land.
  • Neither (a) nor (b)
  • None of these.
Legal Principle: A contract procured by coercion is bad under Indian Contract Act. Coercion is defined as committing or threatening to commit any act forbidden by the Indian Penal Code. Attempt to commit suicide is an offence under Indian Penal Code.
Factual Situation: By threat of suicide, a Hindu induced his wife and son to execute a release in favour of his brother in respect of certain properties which they claimed as their own. 
Issue: Is the deed valid? 
  • The threat of suicide amounted to coercion within Section 15 and the release dead was voidable.
  • The deed is valid and can be executed.
  • Neither (a) nor (b)
  • The deed is not valid and can not be executed.
Legal Principle: Where both parties to an agreement are under a mistake as to a matter of fact essential to the agreement, the agreement is void.
Factual Situation: A man and a women made a separation deed under which the man agreed to pay a weekly allowance to the woman under a mistaken assumption that they were lawfully married.
Issue: It is a valid contract and enforceable in the court of law?
  • Yes, it is a valid contract and enforceable in the court of law.
  • It is a void agreement as there was a common mistake on the point of fact, which was material to the existence of the agreement.
  • It is a voidable contract.
  • It is not a voidable contract.
Legal Principle : A contract obtained by misrepresentation is voidable  at the option of the buyer.
Factual Situation : The director of a company issued a prospectus containing false representation, on the faith of which Z agreed to buy some shares from the company. 
Issue: Can Z avoid contract ?
  • Z may avoid the contract because the directors are deemed to be the agents of the company.
  • Z cannot avoid the contract.
  • There is no contract as such so company is not liable.
  • Neither (a) nor (b).
Legal Principle: Every agreement by which anyone is restrained from exercising a lawful profession, trade or business of any kind, to that extent is void.
Factual Situation: D agreed with P, not to carry on the same business of dress makers on the expiry of the period of his service anywhere within 800 miles of Madras.
Issue:What is the nature of agreement?
  • The agreement is valid.
  • The agreement is void.
  • The agreement is voidable.
  • None of these
Legal Principle: When, at the desire of the promisor, the promisee or, any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing,something, such act or abstinence or promise,is called a consideration for the promise.
Factual Situation: Mohan polished Mr.Ram Prasad's shoes without asking his consent to do so Mr Ram did not make any attempt to stop Mohan from polishing his shoes.
Issue: Can Mohan make Mr Ram liable for payment of his services?
  • Mr Ram is liable to pay because e accepted Mohan's implied offer by not stopping him from polishing his shoes.
  • Ram is not liable because the present situation does not indicate any offer or its acceptance.Hence no contract, no validity, no liability.
  • It is a vague contract, it will be at the discretion of the court to interpret it at its will.
  • None of these
legal Principle: A contract obtained by misrepresentation is voidable at the option of the buyer.
Factual Situation: X falsely representing herself as the wife of a well-known millionaire takes a ring from a jeweler's shop for the approval of her husband. She pledges it with a pawnbroker, who in good faith and without notice of the first transaction pays her Rs.10,000.
Issue: Can the jeweler recover his ring?
  • The jeweler could recover the ring from the pawnbroker as there was no contract between the jeweler and the lady.
  • The jeweler could not recover the ring from the pawnbroker.
  • The jeweler can sue the lady.
  • None of these
Legal Principle : A contract obtained by misrepresentation is voidable at the option of the buyer.
Factual Situation: A intends to sell his horse to B and says, 'My horse is perfectly sounds'. A genuinely believes the horse to be sound, although he does not know that the horse has fallen ill yesterday. B there upon buys the horse.
Issue: is the misrepresentation on the part of A?
  • There is no misrepresentation because it is a business and everything is fair.
  • There is misrepresentation on the part of A because no business can be conducted which involves fraud, misrepresentation, undue influence, force or coercion.
  • Neither (a) nor (b)
  • There is  misrepresentation because it is a business and everything is fair.
Legal Principle: A contract obtained by misrepresentation is voidable at the option of the buyer.
Factual Situation: A by misrepresentation leads B erroneously to believe that 500 maunds of Indigo are made annually at A's factory. B examines the accounts of the factory, which show that only 400 maunds of indigo have been made. After this, B buy the factory.
Issue: Is the contract valid?
  • The contract is not voidable on account of A's misrepresentation, because A had the means of discovering the truth with ordinary diligence.
  • The contract is void as it is a clear-cut case of misrepresentation.
  • Neither (a) nor (b)
  • None of these.
Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence.
Factual Situation: A, an illiterate old man, was made to put his signature on a document which was a pro-note. A thought the document to be a will where his signature was required as a witness. Under this presumption, he signed the document which was in fact a pro-note. Subsequently B endorsed the pro-note to C who paid value for it in good faith. C sued A on the pro-note.
Issue: Is A liable?
  • A is liable because the pro-note was signed by him.
  • A is not liable because A had not signed the pro-note with the intention of endorsement to C.
  • Neither (a) nor (b)
  • Both (a) and (b)
Legal Principle: The act of using influence on another and taking undue advantage of that person is called undue influence. 
Factual Situation: A youth of 18 years of age, spendthrift and a drunkard, borrowed Rs. 900 on a bond bearing compound interest at 2 per cent per mensem.
Issue : Is it a case of undue influence ?
  • No, it is not a case of undue influence.
  • It is a case of undue influence.
  • It is a contract voidable at the option of the youth.
  • Both (a)and (b).
Legal Principle: Where both parties to an agreement are under a mistake as to matter of fact essential to the agreement, the agreement is void.
Factual Situation: There is an agreement between A and B for the purchase of a certain horse. But the horse is dead at the time of the contract.
Issue: What is the nature of contract?
  • The contract is valid and enforceable in the court of law.
  • The contract is void.
  • The contract is voidable.
  • None of these
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Practice Class 11 Commerce Legal Studies Quiz Questions and Answers