Question 1

In a contract, both buyer and supplier agreed the lead time is 3 days. The contract also requires that any variation must be made in writing. Then the buyer places an order by phone call and requests delivery the next day, but the supplier delivers on the third day since the order. Can buyer refuse to pay as supplier did not deliver per time?

Options :

A : No, the supplier delivers within a reasonable time

B : Yes, late delivery is a force majeure event

C : No, supplier has shortened lead time to 1 day

D : Yes, the supplier has breached the contract

Answer: A

Question 2

Which of the following are likely to be advantages of using invitation to tender? Select TWO that apply:

Options :

A : Quick implementation

B : Short turnaround times

C : Reducing risks of bribery and corruption

D : Driving forward planning culture

E : Lower administration costs

Answer: C,D

Question 3

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

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

Sharaton Foods Holding is looking for a vegetable harvesting and packaging system. They use the performance specification in the tendering process. What are the benefits of using this type of specification?

1. Provide opportunities for innovation
2. Potentially limit the competition among the suppliers
3. Require less effort to produce a specification
4. Allow the end user to provide details on technical aspects

Options :

A : 1 and 4 only

B : 1 and 3 only

C : 1 and 2 only

D : 2 and 3 only

Answer: B