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Test 1 - Suggested Solution BLAW

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37 views3 pages

Test 1 - Suggested Solution BLAW

Uploaded by

mz5186641
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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CAF 04: Business Law

Suggested Solution – Test # 1

Answer # 1

(a)
No, there is no valid contract between Ahmed and Bilal. Bilal’s response of Rs. 450 was a counteroffer,
which canceled Ahmed’s original offer of Rs. 500. Once an offer is rejected or changed, it cannot be
accepted later unless it’s re-offered.

(b)
This revocation is valid, because the revocation reached Noor before her acceptance.

Answer # 2

(a)
Rashid made a conditional offer, which Talal failed to meet. Rashid is not bound by the offer, as the
condition was unmet.

(b)
The offer is no longer valid due to the impossibility of performance, because Laila’s painting was
destroyed.

Answer # 3

(a)
Reasons/Events for Lapse of an Offer:
1. Revocation by Offeror:
o The proposer can revoke the offer any time before its acceptance is communicated to
them.
2. Lapse of Time:
o An offer expires if not accepted within the time specified, or within a reasonable time if
no time is set.
3. Condition Precedent Not Met:
o If an offer includes a specific condition and it is not met, the offer lapses.
4. Death or Insanity:
o An offer is terminated if the offeror dies or becomes insane before acceptance, and the
offeree becomes aware of it.
5. Counter Offer or Rejection by Offeree:
o A counteroffer or outright rejection by the offeree terminates the original offer

(b)
Since Sarah didn’t know about Kamran’s reward offer when she found the cat, she cannot claim it. For a
reward to be claimed, the person must know about it beforehand.

Answer # 4

(a)
Rehan's revocation is valid because it was communicated before Sameer received the acceptance.
Therefore, no binding contract is formed.

(b)
The offer has lapsed as it was not accepted within the specified time, making Sarah’s acceptance invalid.

Page 1 of 3
CAF 04: Business Law
Suggested Solution – Test # 1

Answer # 5

(a)
Essential Conditions for Valid Acceptance under the Contract Act, 1872
1. Absolute and Unqualified
Acceptance must match the offer in all terms and be without any conditions. Conditional
acceptance or acceptance with modifications is not valid and is treated as a counter-offer.

2. In the Prescribed Manner


3. If the offer specifies a manner of acceptance, it must be followed. Any deviation from the
specified method renders the acceptance invalid, unless the offeror waives this requirement.

4. Made by the Offeree


Acceptance must be given by the person to whom the offer is made. If a third party accepts on
behalf of the offeree without authority, it is not considered valid acceptance.

5. Within the Time Frame


Acceptance must be communicated within the time stipulated in the offer, or within a reasonable
time if no time is specified, otherwise the offer lapses.

6. Communication to Offeror
For acceptance to be valid, it must be communicated to the offeror. Silence or mere mental
acceptance does not constitute a valid acceptance.

7. Before Revocation of Offer


Acceptance must occur before the offer is withdrawn. Once the offer is revoked, any subsequent
acceptance will be invalid.

8. Legal Intention
The acceptance should demonstrate an intention to create legal relations, signifying that both
parties are entering a binding agreement.

(b)
No, Jamal cannot accept the original offer after initially rejecting it. Jamal’s initial rejection of Asif’s
offer terminated it, so any subsequent acceptance would be considered a new offer, requiring Asif's
agreement.

Answer # 6

No, the customer cannot enforce this sale by law. Under the Contract Act, 1872, displaying goods with a
price tag is an invitation to offer and not an offer itself. The customer’s request to purchase the shirt
constitutes an offer, which the seller is free to accept or reject. Since the seller refused, no binding
contract was formed, and the customer cannot legally enforce the sale.

Page 2 of 3
CAF 04: Business Law
Suggested Solution – Test # 1

Answer # 7

(a)
Validity of Acceptance and Options for Mr. Khan:
No, the acceptance is not valid because Mr. Ali did not follow the specified mode of acceptance (email).
Under the Contract Act, 1872, when an offer specifies a mode of acceptance, it must be followed unless
the offeror waives this requirement. Mr. Khan has two options:
1. Insist on Email: Mr. Khan can require Mr. Ali to resend the acceptance via email, as initially
specified.
2. Accept the Letter: Mr. Khan may waive the mode requirement and accept the letter as valid
acceptance, thereby forming a contract.

(b)
Legal Action for Breach of Social Agreement:
No, Farah cannot take legal action against Anisa. Social agreements, like a dinner invitation, do not
create enforceable legal obligations under the Contract Act, 1872, as they lack the intention to create
legal relations.

(THE END)

Page 3 of 3

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