CLAT Contract Law 1 — Questions and Answers
Question 1: Under the Indian Contract Act, 1872, which section defines a 'contract'?
- Section 2(h) (Correct answer)
- Section 2(e)
- Section 2(a)
- Section 2(b)
Correct answer: Section 2(h)
Section 2(h) of the Indian Contract Act, 1872 defines a contract as an agreement enforceable by law.
Question 2: Which of the following is NOT an essential element of a valid contract under the Indian Contract Act, 1872?
- Written form (Correct answer)
- Free consent
- Lawful consideration
- Competent parties
Correct answer: Written form
A written form is not an essential element; most contracts can be oral unless a specific statute requires writing.
Question 3: A contract made by a minor is:
- Void ab initio (Correct answer)
- Voidable at the minor's option
- Valid if ratified after attaining majority
- Unenforceable
Correct answer: Void ab initio
The Privy Council in Mohori Bibee v. Dharmodas Ghose (1903) held that a minor's contract is void ab initio.
Question 4: Under Section 14 of the Indian Contract Act, consent is said to be free when it is not caused by all of the following EXCEPT:
- Mutual mistake of both parties (Correct answer)
- Coercion
- Undue influence
- Misrepresentation
Correct answer: Mutual mistake of both parties
Section 14 lists coercion, undue influence, fraud, misrepresentation, and mistake as vitiating elements; mutual mistake is covered under Sections 20-22, not Section 14.
Question 5: Which of the following is a 'contingent contract' under the Indian Contract Act?
- A contract to pay Rs. 10,000 if a particular ship arrives safely (Correct answer)
- A contract to deliver goods within 30 days
- A contract where payment is due immediately on signing
- A contract for sale of immovable property
Correct answer: A contract to pay Rs. 10,000 if a particular ship arrives safely
A contingent contract is one to do or not do something upon the happening of a collateral uncertain event, such as a ship arriving safely.
Question 6: The rule in 'Hadley v. Baxendale' (1854) relates to:
- Remoteness of damages in breach of contract (Correct answer)
- Formation of a valid contract
- Doctrine of part performance
- Rescission of voidable contracts
Correct answer: Remoteness of damages in breach of contract
Hadley v. Baxendale established that damages for breach of contract are limited to those that were reasonably foreseeable at the time the contract was made.
Question 7: Under Section 56 of the Indian Contract Act, a contract becomes void when:
- Its performance becomes impossible or unlawful after it is made (Correct answer)
- One party refuses to perform before the due date
- The contract is oral and unwitnessed
- There is no written evidence of the agreement
Correct answer: Its performance becomes impossible or unlawful after it is made
Section 56 embodies the doctrine of frustration — a contract is void if its performance becomes impossible or unlawful due to a subsequent event beyond the parties' control.
CLAT Contract Law 1
Under the Indian Contract Act, 1872, which section defines a 'contract'?