2. Question 1
What does freedom of contract mean?
•A party to a contract may withdraw and enter a new one
with a competitor
•Parties to a contract may change the conditions at will
•Large organisations can withdraw contracts when they
wish
•Parties to a contract are free to negotiate any contract
they are happy to be bound by
3. Question 2
What is a representation?
•A statement which sets out the obligations of the parties
•A statement of fact made which turns out to be wrong
•A statement of fact made before a contract is made
which may induce the contract
•A boast or hype used to sell a product (trader’s puff)
4. Question 3
What is the difference between a condition and a
warranty?
•A warranty is only available under certain conditions
•A condition is a term vital to a contract, a warranty less so
•No difference – they are both terms of a contract
•A condition is not necessary to a contract whereas a
warranty is
5. Question 4
What are implied terms of a contract?
•Terms which have been discussed between the parties
•The contract would make little sense without them
•Terms which have been laid down by an Act of Parliament
•Terms which have been written down
6. Question 5
If you were to buy a pair of shoes which came apart at the
seam within 6 months which section of the Sale of Goods
Act would have been breached?
•13 – Goods will correspond to the description
•15 – Samples supplied must correspond with the bulk order
subsequently supplied
•14 – Goods must be of merchantable quality and fit for purpose
•12 – The seller has the right to sell the goods
7. Question 6
What does an exemption clause seek to do?
•Exclude or limit liability in the event of a breach of
contract
•Allow the stronger party to retain control
•Provide for the safety of the consumer
•Demonstrate that both parties are happy with the
contract
8. Question 7
Under the Unfair Contract Terms Act what liability
can never be excluded from a contract?
•Description of goods is as accurate as possible
•Consumers have their right to change their minds within
14 days
•Replace defective products if they fail to satisfy the
consumer
•Liability for death and injury
9. Question 8
Why do businesses produce a standard form
contract which they use for all sales?
•To bind customers to obligations which they don’t
understand
•To baffle customers with the use of legal jargon so they
will not question it
•Cannot possibly negotiate separate terms with each
customer
•To get in first with the “battle of the forms”
10. Question 9
What can a consumer do if a contract is seen to be
highly disadvantageous to them?
•Go to trading standards and seek advice
•Shop around for an alternative supplier with a better
contract
•Employ a solicitor to argue the terms
•Sign up anyway as they are bound to get a fair deal
11. Question 10
If two parties are negotiating over terms of a
contract, when should performance begin?
•When there is clear agreement between the parties
•When the second contract is received
•During negotiations between the parties
•When the first contract is handed over
