Question 1

Which of the following usually have no legal standing? Select TWO that apply:

Options :

A : Commission

B : Framework agreement

C : Framework arrangement

D : Estimate

E : Service level agreement

Answer: C,D

Question 2

Which of the following are true statements about RFQ process? Select TWO that apply.

Options :

A : RFQ process creates heavier administrative burdens than tendering process

B : Price is often the only variable in the RFQ and quotations

C : Buying organisation should only send RFQ to pre-qualified suppliers

D : RFQ process is not suitable for low value purchase

E : RFQ process requires the suppliers to submit their technical proposals

Answer: B,C

Question 3

Which of the following are reasons why a purchaser wants to embed a subcontracting clause into the main contract? Select TWO that apply:

Options :

A : To improve supply chain transparency

B : To condemn whole liabilities to subcontractors

C : To reduce the main contract complexity

D : To keep main contractor liable

E : To induce the conflicts between the main contractor and subcontractors

Answer: A,D

Question 4

A retailer prefers to display its best selling products and promotion programme on the building windows. According to rule of contract formation, this act will generally constitute...?

Options :

A : A legal capacity

B : An invitation to treat

C : An offer

D : A mailbox rule

Answer: B

Question 5

MWB operates serviced offices in central London. Rock entered a contractual licence with MWB to occupy office space in Marble Arch and had accumulated licence fees in arrears. The original licence agreement contained a ‘No Oral Modification’ clause that said: 'All variations to this licence must be agreed, set out in writing and signed on behalf of both parties before they take effect'.
After 6 months, Rock director re-negotiated to extend payment period over phone call and MWB credit controller agreed his proposal. Is this agreement considered as an effective variation to the original licence agreement?

Options :

A : No, because the mechanism for variation has been set out in the original contract

B : Yes, because parties who agree to altering the original contract orally despite a ‘No Oral Modification’ clause, must have intended to dispense with the clause

C : No, because Rock director assumed that the variation was effective and convinced credit controller to believe it

D : Yes, because the credit controller had agreed with Rock director’s proposal

Answer: A