Discharge Of Contract MCQ With Answers

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Questions: 56 | Attempts: 4,223 | Updated: Mar 15, 2024

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Discharge Of Contract MCQ With Answers - Quiz

Discharge Of a Contract happens when the legal obligation of a contractual term comes to a termination.? Test yourself with " Discharge Of Contract MCQ With Answers." How much do you know about it? Test how knowledgeable you are in Business law with this fun yet informative quiz. This quiz is made for students who are ready to prepare well for their examinations. Pick the correct option from the multiple options given in the quiz to get a good score. All the very best!

Questions and Answers

1.

On the valid performance of contract, the contract is said to be discharged.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
When a contract is discharged, it means that the parties involved have fulfilled their obligations and have completed all the necessary actions as outlined in the contract. This can include things like making payments, delivering goods or services, or meeting any other agreed-upon terms. Therefore, the statement "On the valid performance of contract, the contract is said to be discharged" is true because when both parties have performed their duties as required, the contract is considered fulfilled and no longer in effect.

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2.

Which of the following is a made of discharge of contract ?
- A.
  
  By performance of contract
- B.
  
  By agreement
- C.
  
  By impossibility of performance
- D.
  
  All of these
Correct Answer
D. All of these

Explanation
The correct answer is "All of these." This means that a discharge of contract can occur through various means, including by performance of the contract, by agreement between the parties, and by impossibility of performance. In other words, a contract can be considered discharged if the parties fulfill their obligations, if they mutually agree to terminate the contract, or if it becomes impossible to fulfill the terms of the contract.

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3.

In which of the following modes, the contract is discharged?
- A.
  
  By operation of Law
- B.
  
  By lapse of Law
- C.
  
  By breach of contract
- D.
  
  All of these.
Correct Answer
D. All of these.

Explanation
The contract can be discharged in multiple ways, including by operation of law, by lapse of time, and by breach of contract. When a contract is discharged by operation of law, it means that it is terminated due to certain legal events or circumstances, such as bankruptcy or impossibility of performance. Discharge by lapse of time occurs when the contract's specified duration has expired. Lastly, a contract can be discharged by breach when one party fails to fulfill their obligations, allowing the other party to terminate the contract. Therefore, all of these options are correct.

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4.

The term frustration' is used in the English law which is the parallel concept of
- A.
  
  Initial impossibility
- B.
  
  Supervening impossibility
- C.
  
  Lapse of time
- D.
  
  Public policy
Correct Answer
B. Supervening impossibility

Explanation
Supervening impossibility refers to a situation where the performance of a contract becomes impossible due to unforeseen events that occur after the contract was formed. This concept is used in English law to excuse parties from their contractual obligations when external circumstances make it impossible for them to fulfill their obligations. Unlike initial impossibility, which refers to situations where the contract was impossible from the beginning, supervening impossibility deals with situations where the contract becomes impossible to perform after it was formed. This concept recognizes that parties should not be held liable for events that were beyond their control and could not have been foreseen at the time of contract formation.

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5.

The discharge of contract means that the parties are no more liable under the contract.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
The statement is true because the discharge of a contract signifies that the parties involved are released from their obligations and are no longer legally bound by the terms of the contract. This can occur through various means such as performance, agreement, frustration, breach, or operation of law. Once a contract is discharged, the parties are no longer liable to fulfill their contractual duties and can move on without any legal consequences.

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6.

The discharged of contract means the
- A.
  
  Enforcement of obligations of parties
- B.
  
  Corning to end of obligations of parties.
- C.
  
  Starting of obligation.
- D.
  
  Payment of carriages and penalty
Correct Answer
B. Corning to end of obligations of parties.

Explanation
The correct answer is "Corning to end of obligations of parties." This means that the discharge of contract refers to the completion or fulfillment of the obligations of both parties involved in the contract. It signifies that all the terms and conditions of the contract have been met, and the parties are no longer bound by any further obligations.

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7.

The legal provisions relating to discharge of contract by impossibility of performance are contained in
- A.
  
  Section 55
- B.
  
  Section 56
- C.
  
  Section 58
- D.
  
  Section 59
Correct Answer
B. Section 56

Explanation
The correct answer is Section 56. Section 56 of the Indian Contract Act, 1872 deals with the discharge of a contract by impossibility of performance. It states that a contract becomes void when it becomes impossible to perform due to an event that the parties could not have anticipated or controlled. This section provides relief to parties who are unable to fulfill their contractual obligations due to unforeseen circumstances beyond their control.

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8.

An agreement to do an act impossible in itself, is void. This statement refers to initial impossibility and is provided in
- A.
  
  Section 56 first Para
- B.
  
  Section 56, second Para
- C.
  
  Section 57
- D.
  
  Section 59
Correct Answer
A. Section 56 first Para

Explanation
This statement refers to initial impossibility, which means that if an agreement is made to do something that is impossible to begin with, it is considered void. This is stated in the first paragraph of Section 56.

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9.

The provision relating to supervening (i.e., subsequent) impossibility is provided in
- A.
  
  Section 56, first para
- B.
  
  Section 56, second para
- C.
  
  Section 57
- D.
  
  None of these.
Correct Answer
B. Section 56, second para

Explanation
The correct answer is Section 56, second para. This section deals with the concept of supervening impossibility, which means that after the formation of a contract, if the performance of the contract becomes impossible due to an event that was not anticipated by the parties, then the contract becomes void. The second paragraph of Section 56 specifically states that a contract becomes void if it becomes impossible to perform due to an event that the parties could not have anticipated or prevented.

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10.

Which of the following impossibility is the ground for discharge of contract ?
- A.
  
  Initial impossibility.
- B.
  
  Supervening impossibility.
- C.
  
  Both of these.
- D.
  
  None of these.
Correct Answer
C. Both of these.

Explanation
Both initial impossibility and supervening impossibility are grounds for discharge of a contract. Initial impossibility refers to a situation where it is impossible to perform the contract at the time it is made. Supervening impossibility, on the other hand, occurs when an event or circumstance arises after the contract is made, making it impossible to fulfill the contract. In both cases, the impossibility of performance releases the parties from their obligations under the contract.

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11.

An agreement to do an act impossible in itself, is ___________
- A.
  
  Void
- B.
  
  Voidable
- C.
  
  Valid
- D.
  
  Illegal
Correct Answer
A. Void

Explanation
An agreement to do an act impossible in itself is considered void because it is not legally enforceable. This means that neither party can be held liable for not fulfilling their obligations under the agreement. In legal terms, a void agreement is treated as if it never existed. Therefore, any rights or obligations arising from the agreement are null and void.

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12.

A contract containing an undertaking to do an impossible act, is ____________
- A.
  
  Void ab initio
- B.
  
  Voidable
- C.
  
  Valid
- D.
  
  Illegal
Correct Answer
A. Void ab initio

Explanation
When a contract contains an undertaking to do an impossible act, it is considered void ab initio. This means that the contract is deemed invalid from the beginning and has no legal effect. The impossibility of performing the act makes the contract impossible to fulfill, rendering it void and unenforceable.

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13.

An initial impossibility i.e., which exists at the time of formation of the contract, makes the contract
- A.
  
  Valid
- B.
  
  Voidable
- C.
  
  Void ab initio
- D.
  
  Illegal
Correct Answer
C. Void ab initio

Explanation
An initial impossibility, meaning that the contract is impossible to fulfill from the moment it is formed, renders the contract void ab initio. This means that the contract is considered null and void from the beginning, as if it never existed. Therefore, the parties involved are not bound by any obligations or rights under the contract.

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14.

A contract is void on the ground of initial impossibility
- A.
  
  Only where it is unknown to the parties.
- B.
  
  Only where it is known to the parties.
- C.
  
  Whether it is known or unknown to the parties at the time of agreement.
- D.
  
  When it is known to the third parties.
Correct Answer
C. Whether it is known or unknown to the parties at the time of agreement.

Explanation
A contract can be considered void on the ground of initial impossibility regardless of whether it is known or unknown to the parties at the time of agreement. This means that if the performance of the contract is impossible from the beginning, it is considered void and the parties are not obligated to fulfill their obligations. The knowledge or lack thereof regarding the impossibility of performance does not affect the validity of the contract.

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15.

A agreed to sell his horse to B. But unknown to both the parties, the horse was dead at the time of agreement, In this case, the contact is
- A.
  
  Void and the parties are discharged form performance.
- B.
  
  Void but the parties are not discharged from performance.
- C.
  
  Voidable at the option of either party.
- D.
  
  Voidable at the option of A only.
Correct Answer
A. Void and the parties are discharged form performance.

Explanation
The agreement between A and B is void because the horse was dead at the time of the agreement. In a void contract, the contract is considered to have no legal effect from the beginning, and the parties are not bound to perform their obligations. Therefore, both parties are discharged from their performance obligations.

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16.

The initial impossibility may be known or unknown to the parties, the agreement is void in both the cases, but where it is known to the promisor alone, he is liable to pay compensation to the promisee which he may suffer on account of non-performance of the contract.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
When there is an initial impossibility in a contract, it can be known or unknown to the parties involved. In either case, the agreement is considered void. However, if the impossibility is known only to the promisor, they are still liable to compensate the promisee for any losses they may suffer due to the non-performance of the contract. Therefore, the statement is true.

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17.

When after the formation of a valid contract, an event happens which makes the performance of contract impossible, the contract becomes
- A.
  
  Voidable
- B.
  
  Void
- C.
  
  Valid
- D.
  
  Illegal
Correct Answer
B. Void

Explanation
When an event occurs after the formation of a valid contract that makes it impossible to perform, the contract becomes void. This means that the contract is considered to have no legal effect from the beginning, and the parties are released from their obligations under the contract. Void contracts are essentially treated as if they never existed in the first place.

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18.

In which of the following cases, the contract is not discharged on the ground of subsequent impossibility?
- A.
  
  Death of promisor
- B.
  
  Change of law
- C.
  
  Commercial hardships
- D.
  
  Destruction of subject - matter.
Correct Answer
C. Commercial hardships

Explanation
The contract is not discharged on the ground of subsequent impossibility in the case of commercial hardships. This means that even if there are difficulties or challenges in fulfilling the contract due to economic reasons or financial constraints, the contract is still considered valid and enforceable. The parties involved are expected to find a way to overcome these hardships and fulfill their obligations under the contract.

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19.

Which of the following is the leading case on the discharge of contract by destruction of subject matter ?
- A.
  
  Krell v. Henri, (1903) 2 KB 740 CA.
- B.
  
  Taylor v. Caldwell, (1863) 3 B&R 826.
- C.
  
  Taylor v. Potington,(1855) All E.R. 128
- D.
  
  Carlill V. Carbolic Smoke Ball Co., (1893) l.Q.B 256.
Correct Answer
B. Taylor v. Caldwell, (1863) 3 B&R 826.
20.

A agreed to let a music hall to B for holding music shows on a certain dates. Before any show was organized, the music hall has destroyed in an accidental fire. In this case, the contract becomes
- A.
  
  Void a and is discharged
- B.
  
  Voidable at A's option.
- C.
  
  Void but not discharged.
- D.
  
  Voidable at B's option.
Correct Answer
A. Void a and is discharged

Explanation
The contract becomes void and is discharged because the music hall was destroyed in an accidental fire before any shows could be organized. This means that the contract is no longer valid and both parties are released from their obligations under the contract.

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21.

Failure of the basic object of the contract due to non-occurrence of the contemplated event makes the contract
- A.
  
  Voidable
- B.
  
  Illegal
- C.
  
  Void
- D.
  
  None of these
Correct Answer
C. Void

Explanation
The failure of the basic object of the contract due to the non-occurrence of the contemplated event renders the contract void. This means that the contract is considered to have no legal effect from the beginning, as if it never existed. Both parties are released from their obligations and any consideration exchanged must be returned.

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22.

A contracts to paint a picture for B for Rs. 10,000. A dies before paining the picture. In this case, on A'sdeath, the contract becomes
- A.
  
  Voidable at B's option
- B.
  
  Void and is discharged
- C.
  
  Voidable at option of A's legal heirs
- D.
  
  None of these
Correct Answer
B. Void and is discharged

Explanation
When A dies before painting the picture, the contract becomes void and is discharged. This means that the contract is no longer valid and both parties are released from their obligations. Since A is no longer able to fulfill the contract due to their death, B cannot enforce it. Therefore, the contract is considered void and terminated.

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23.

A contract is discharged on account of change of circumstances where the performance becomes
- A.
  
  Virtually impossible
- B.
  
  Extremely difficult or hazardous
- C.
  
  Temporarily impossibility
- D.
  
  Both (a) and (b).
Correct Answer
D. Both (a) and (b).

Explanation
A contract can be discharged on account of a change of circumstances when the performance becomes virtually impossible or extremely difficult or hazardous. This means that if the circumstances surrounding the contract change to the point where it is nearly impossible or highly risky to fulfill the obligations outlined in the contract, the contract can be considered discharged. Both options (a) and (b) reflect different scenarios in which the performance of the contract becomes significantly challenging or impossible.

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24.

In which of the following cases, a contract is discharged on the ground of frustration or subsequent impossibility ?
- A.
  
  Outbreak of war
- B.
  
  Change of law or government policy
- C.
  
  Both of these.
- D.
  
  None of these.
Correct Answer
C. Both of these.

Explanation
A contract can be discharged on the ground of frustration or subsequent impossibility in both cases of outbreak of war and change of law or government policy. In the case of outbreak of war, the contract may become impossible to perform due to the disruption and impact of the war. Similarly, if there is a change in law or government policy that renders the contract impossible to fulfill, it can be discharged on the ground of frustration or subsequent impossibility. Therefore, both of these situations can lead to the discharge of a contract.

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25.

In which of the following cases, the contract is not discharged on the ground of frustration or subsequent impossibility?
- A.
  
  Difficulty in performance
- B.
  
  Commercial hardships
- C.
  
  Strikes, lock out etc.
- D.
  
  All of these.
Correct Answer
D. All of these.

Explanation
The contract is not discharged on the ground of frustration or subsequent impossibility in all of the mentioned cases. Difficulty in performance, commercial hardships, and strikes, lockouts, etc. do not automatically discharge the contract. These factors may make the performance of the contract more challenging or inconvenient, but they do not render it impossible. The parties are still obligated to fulfill their contractual obligations unless there is a specific provision in the contract or applicable law that allows for discharge in such circumstances.

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26.

In which of the following cases the contract is not discharged on account of frustration or subsequent impossibility?
- A.
  
  Impossibility induced by the party himself
- B.
  
  Impossibility due to conduct of third person
- C.
  
  Failure of one of the several objects
- D.
  
  All of the these.
Correct Answer
D. All of the these.

Explanation
The correct answer is "All of the these." In all of the mentioned cases, the contract is not discharged on account of frustration or subsequent impossibility. Impossibility induced by the party himself, impossibility due to the conduct of a third person, and failure of one of the several objects are all situations where the contract remains valid and enforceable.

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27.

A agreed to supply certain goods to B which to be procured form C's factory . Due to strike in C's factory, A could not supply the goods. The contract
- A.
  
  Become void on account of impossibility.
- B.
  
  Becomes voidable on account of difficulty
- C.
  
  Is discharged on account of impossibility.
- D.
  
  Is not discharged on account of impossibility .
Correct Answer
C. Is discharged on account of impossibility.

Explanation
Impossibility refers to situations where performance of a contract becomes objectively impossible due to unforeseen events, such as a strike in C's factory in this case. When such impossibility arises, the contract is discharged, meaning the parties are released from their obligations.

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28.

In case the performance of a contract becomes more difficult due to some unexpected events, then the contract
- A.
  
  Become void on account of impossibility.
- B.
  
  Becomes voidable on account of difficulty
- C.
  
  Is discharged on account of impossibility.
- D.
  
  Is not discharged on account of impossibility .
Correct Answer
D. Is not discharged on account of impossibility .

Explanation
If the performance of a contract becomes more difficult due to unexpected events, the contract is not automatically discharged on the basis of impossibility. Instead, the parties may still be required to fulfill their obligations under the contract, even if it has become more challenging. Impossibility would typically need to be proven as an absolute and objective impossibility for the contract to be discharged.

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29.

A agreed to supply certain goods to B Which were to be imported by C. But C failed to import the goods. In this case, the contract is
- A.
  
  Discharged
- B.
  
  Not discharged
- C.
  
  Voidable
- D.
  
  Impossible to perform.
Correct Answer
B. Not discharged

Explanation
The contract is not discharged because even though C failed to import the goods, A and B still have a valid agreement to supply the goods. The failure of C to import the goods does not release A from their obligation to supply the goods to B. Therefore, the contract remains in force and is not discharged.

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30.

The legal provisions relating to the discharge of contract by mutual agreement of the parties are contained in
- A.
  
  Section 61
- B.
  
  Section 62
- C.
  
  Section 63
- D.
  
  Both (b) and (c).
Correct Answer
D. Both (b) and (c).

Explanation
The correct answer is "Both (b) and (c)." This means that the legal provisions relating to the discharge of a contract by mutual agreement of the parties are contained in both Section 62 and Section 63.

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31.

When the parties enter into fresh contract in place of the original contract, then the original contract
- A.
  
  Is discharged
- B.
  
  Is not discharged
- C.
  
  Is suspended
- D.
  
  Becomes voidable.
Correct Answer
A. Is discharged

Explanation
When the parties enter into a fresh contract in place of the original contract, the original contract is discharged. This means that the original contract is terminated and no longer legally binding. The parties have agreed to replace the original contract with a new one, indicating that they no longer wish to be bound by the terms of the original contract.

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32.

Which of the following modes of discharge of contract by fresh agreement are recognised under the Indian Contract Act?
- A.
  
  Notation
- B.
  
  Rescission
- C.
  
  Alteration
- D.
  
  All of these.
Correct Answer
D. All of these.

Explanation
All of the modes of discharge of contract by fresh agreement mentioned in the options - notation, rescission, and alteration - are recognized under the Indian Contract Act. Notation refers to the cancellation of a contract by a written agreement between the parties. Rescission involves the termination of a contract by mutual agreement. Alteration refers to the modification or change in the terms of the contract by the parties' agreement. Therefore, all of these modes are recognized under the Indian Contract Act.

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33.

Which of the following modes of discharge of contract by fresh agreement are also recognised under the Indian Contract Act?
- A.
  
  Remission
- B.
  
  Waiver
- C.
  
  Both (a) and (b)
- D.
  
  None of these.
Correct Answer
C. Both (a) and (b)

Explanation
Both remission and waiver are modes of discharge of a contract by fresh agreement that are recognized under the Indian Contract Act. Remission refers to the acceptance by the promisee of a lesser performance than what was originally agreed upon, while waiver refers to the voluntary abandonment of a right by one party. These modes allow for the discharge of a contract through mutual agreement and are legally recognized in India.

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34.

Acceptance of any other satisfaction by the promisee also discharges the contract.
- A.
  
  True,as it has been recognised a under Section 63
- B.
  
  False,as it not the recognised mode of discharge of contract.
Correct Answer
A. True,as it has been recognised a under Section 63

Explanation
The given answer is true because it is stated under Section 63 of the contract law that the acceptance of any other satisfaction by the promisee also discharges the contract. This means that if the promisee accepts any other form of satisfaction or fulfillment from the promisor, it will be considered as a valid discharge of the contract. Therefore, the statement is correct.

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35.

A contract is discharged by notation, which means the
- A.
  
  Cancellation of the existing contract
- B.
  
  Change of one or more terms of the contract
- C.
  
  Substitution of existing contract for a new one
- D.
  
  Abandonment of the rights by a party .
Correct Answer
C. Substitution of existing contract for a new one

Explanation
Discharge by notation refers to the substitution of an existing contract for a new one. This means that the original contract is replaced with a new agreement, effectively discharging the obligations and terms of the previous contract.

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36.

A contract is discharged by rescission, which means the
- A.
  
  Cancellation of the existing contract
- B.
  
  Change in one 6r more terms of contract
- C.
  
  Acceptance of lesser performance
- D.
  
  None of these.
Correct Answer
A. Cancellation of the existing contract

Explanation
Rescission refers to the cancellation or termination of an existing contract. This means that the parties involved agree to end the contract, releasing each other from their obligations and returning to their original positions before the contract was made. It is a way to discharge a contract and is typically done when there is a breach of contract or if both parties mutually agree to end the agreement.

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37.

If the parties to a contract agrees to alter the contract, then the existing contract
- A.
  
  Need not be performed and is discharged
- B.
  
  Is not discharged as alteration is not permitted
- C.
  
  Become voidable at the option of either party
- D.
  
  Remains alive till brought to original terms and conditions.
Correct Answer
A. Need not be performed and is discharged

Explanation
If the parties to a contract agree to alter the contract, it means they have mutually agreed to make changes to the original terms and conditions of the contract. In such a case, the existing contract is no longer binding and does not need to be performed. It is considered discharged, meaning that the parties are released from their obligations under the original contract. This allows them to move forward with the altered terms or negotiate a new agreement.

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38.

A contract is discharged by remission, which means the
- A.
  
  Abandonment of a right by the party
- B.
  
  Cancellation of existing contract
- C.
  
  Acceptance of lesser performance
- D.
  
  None of these.
Correct Answer
C. Acceptance of lesser performance

Explanation
Remission refers to the acceptance of lesser performance in a contract. This means that one party agrees to accept a lower level of performance or a partial fulfillment of the contract terms. By accepting this lesser performance, the contract is considered discharged, meaning that both parties are released from their obligations under the original terms of the contract.

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39.

A owed Rs. 5,000 to B A paid Rs, 4,000 to B and B accepted it in full satisfaction. In this case.
- A.
  
  A is discharged from his liability of Rs. 5,000
- B.
  
  A remains liable for the balance Rs. 1,000
- C.
  
  Contract becomes voidable at B's option
- D.
  
  A is discharged form his liability but the contract is not discharged.
Correct Answer
A. A is discharged from his liability of Rs. 5,000

Explanation
When B accepts the payment of Rs. 4,000 from A in full satisfaction, it means that B agrees to consider the debt fully paid and does not expect A to pay the remaining Rs. 1,000. Therefore, A is discharged from his liability of Rs. 5,000.

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40.

A, a money-lender, lends Rs. 15,000 to B for his business purposes. Subsequently, A, at his own, informs B that he need not repay the amount. Here, the contract is discharged by
- A.
  
  Novation
- B.
  
  Satisfaction
- C.
  
  Performance
- D.
  
  Waiver.
Correct Answer
D. Waiver.

Explanation
In this scenario, the contract is discharged by waiver. Waiver refers to the intentional relinquishment of a right or claim. In this case, A, the money-lender, voluntarily informs B that he does not need to repay the borrowed amount. By doing so, A waives his right to demand repayment from B, effectively discharging the contract.

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41.

The acceptance of a any other satisfaction by the promisee, instead of the performance of the promise made to him,
- A.
  
  Discharges the contract
- B.
  
  Does not discharge the contract
- C.
  
  Makes the contract voidable at the option of other party
- D.
  
  Delays the performance of the contract.
Correct Answer
A. Discharges the contract

Explanation
When the promisee accepts any other form of satisfaction instead of the promised performance, it means that both parties have agreed to discharge the contract. This means that the contractual obligations and responsibilities of both parties are considered fulfilled and the contract is terminated.

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42.

In which of the following cases, the contract is discharged by operation of law?
- A.
  
  Material alteration
- B.
  
  Insolvency
- C.
  
  Death of promisor
- D.
  
  AII of these
Correct Answer
D. AII of these

Explanation
The contract can be discharged by operation of law in all of the given cases. A material alteration of the contract without the consent of all parties can render it void. Insolvency of either party can result in the automatic discharge of the contract. Additionally, the death of the promisor can also discharge the contract as it becomes impossible to perform. Therefore, all of these scenarios can lead to the discharge of the contract by operation of law.

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43.

When the contents of a written document are materially altered by one party without the consent of the other, the contract (i.e., written document), Is
- A.
  
  Discharged
- B.
  
  Not discharged
- C.
  
  Enforceable with court permission
- D.
  
  Voidable.
Correct Answer
A. Discharged

Explanation
When the contents of a written document are materially altered by one party without the consent of the other, the contract is considered discharged. This means that the contract is no longer valid or enforceable because the alteration of the document has fundamentally changed the terms and conditions agreed upon by both parties. The party who made the alteration without consent has essentially breached the contract, leading to its discharge.

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44.

Material alteration of a written document by one party without the consent of the other operates as cancellation, of the document.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
When a party alters a written document without the consent of the other party, it is considered a material alteration. This alteration can be seen as an act of cancellation of the original document, as it changes the terms or conditions agreed upon by both parties. Therefore, the statement "Material alteration of a written document by one party without the consent of the other operates as cancellation of the document" is true.

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45.

An insolvent is discharged form all liabilities and debts contacted by him
- A.
  
  Throughout his life as an insolvent is discharged permanently.
- B.
  
  After the court order declaring him as insolvent.
- C.
  
  Prior to the court order declaring him as insolvent.
- D.
  
  After court order and with the permission of the court.
Correct Answer
C. Prior to the court order declaring him as insolvent.

Explanation
The correct answer is "Prior to the court order declaring him as insolvent." This means that the insolvent is discharged from all liabilities and debts before the court officially declares them as insolvent. Once the court order is issued, the insolvent is no longer discharged from any liabilities or debts.

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46.

A contracts to sing in B's there on a particular show . A died before the show, in this case, the contract
- A.
  
  Becomes avoidable at the option of B.
- B.
  
  Must be performed by A's legal representatives on his behalf.
- C.
  
  Is discharged as it is a contract involving personal skills of promisor.
- D.
  
  Becomes unlawful being a contract with dead person.
Correct Answer
C. Is discharged as it is a contract involving personal skills of promisor.

Explanation
The correct answer is that the contract becomes discharged as it is a contract involving personal skills of the promisor. In this case, since A has died before the show, it is not possible for anyone else, including A's legal representatives, to perform the contract. The contract specifically relies on A's personal skills, which are no longer available due to their death. Therefore, the contract is discharged and cannot be fulfilled.

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47.

Contracts involving personal skill or consideration of the promisor are discharged, by operation of law on the death of the promisor.
- A.
  
  True
- B.
  
  False
Correct Answer
A. True

Explanation
Contracts involving personal skill or consideration of the promisor are discharged by operation of law on the death of the promisor. This means that if a contract requires the personal skill or consideration of the promisor, and the promisor dies, the contract is automatically terminated. This is because the personal skill or consideration of the promisor is no longer available due to their death, making it impossible to fulfill the contract. Therefore, the statement "True" is correct.

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48.

A contract is discharged if it is not enforced within the limitation period prescribed by law. The limitation period for the recovery of loan amount is
- A.
  
  2 Years
- B.
  
  3 Years
- C.
  
  4 Years
- D.
  
  5 Years
Correct Answer
B. 3 Years

Explanation
A contract is discharged if it is not enforced within the limitation period prescribed by law. In this case, the limitation period for the recovery of a loan amount is 3 years. This means that if the lender does not take legal action to recover the loan within 3 years from the date it became due, the contract will be discharged and the borrower will no longer be legally obligated to repay the loan.

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49.

Failure by a party to perform his obligations under the contract is known as
- A.
  
  Breach of contract
- B.
  
  Failure of contract
- C.
  
  Performance of contract
- D.
  
  None of these.
Correct Answer
A. Breach of contract

Explanation
Breach of contract refers to the failure of one party to fulfill their obligations as stated in the contract. This can include a failure to deliver goods or services, non-payment, or any other violation of the terms agreed upon. It is a legal term used to describe a situation where one party has not upheld their end of the agreement, and the other party may seek legal remedies or damages as a result.

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50.

Which of the following types of breach of contract are recognised under the Indian Contract Art?
- A.
  
  Actual breach
- B.
  
  Anticipatory breach
- C.
  
  Both (a) and (b)
- D.
  
  Only (a).
Correct Answer
C. Both (a) and (b)

Explanation
Both actual breach and anticipatory breach are recognized under the Indian Contract Act. Actual breach refers to a situation where one party fails to fulfill their contractual obligations at the agreed-upon time. Anticipatory breach, on the other hand, occurs when one party clearly indicates their intention to not fulfill their contractual obligations in the future. In both cases, the non-breaching party may seek legal remedies for the breach of contract.

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Aug 22, 2011

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Discharge Of Contract MCQ With Answers

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