1. Which of the following is an invitation to treat?

A. A "Buy 2 Free 1" promotion in a clothing store

B. An advertisement for reward on information relating to a kidnapping incident

C. A brochure for a spa service

D. A notice saying, "Mystery gift with every purchase over RM500"

2. Arif who is 65 years old, promised to pay for his sister's wedding at a hotel in Bali. He has now changed his mind. Is Arif under any legal obligation to fulfil his promise to his sister?

A. Yes, Arif's consent was freely given by him

B. Yes, there is a fiduciary relation between Arif and his sister

C. No, there was no intention to create legal relations between the parties

D. No, Arif has no capacity to make a contract as he is too old to do so

3. When parties to an agreement use post for communication, the Postal Rule applies. Under this rule,

A. an agreement is binding on the offeror when the offeror has posted the offer

B. an agreement is binding on the offeree when the offeree has received the offer

C. an agreement is binding on the offeror when the offeree has posted the acceptance

D. an agreement is binding on the offeree when the offeree has posted the acceptance

4. The case of Kepong Prospecting Ltd v A.E. Schmidt & Marjorie Schmidt [1968] 1 MLJ 170 laid down the principle that

A. A consideration is executed when a promise is made in exchange for the performance of an act

B. A consideration given in the past is valid consideration

C. A contract without consideration is voidable

D. A promise made by one party in return for a promise made by another party is known as an executory consideration

5. Which of the following is NOT TRUE about legal capacity to contract?

A. A minor is a person who has not reached the age of majority

B. A minor who has sold his property to another person may apply to the court for recovery of the property

C. A contract made by an unsound person is voidable

D. A person who is an adult and is of sound mind can be disqualified from entering into a contract

6. A minor may enter into a contract in certain situations. Which of the following are those exceptions?

i. An 11-year-old child purchased an insurance policy with his parent's permission

ii. A 14-year-old boy who wished to become a musician entered into a contract with a music tutor to learn how to play a piano

iii. A 16-year old girl ordered an expensive evening gown to wear at her birthday party

iv. A 17-year-old student received a scholarship to study medicine abroad

A. i, ii and iii

B. i, ii and iv

C. i, iii and iv

D. ii, iii and iv

7. Kennedy sold his factory to Sufri for RM5 million. Kennedy stated that his factory could produce 10,000 loafs of bread per day. Later Sufri discovered that the factory can only produce 9,000 loafs of bread per day. What is the legal position of the contract between Kennedy and Sufri?

A. The contract is voidable under undue influence

B. The contract is void under fraud

C. The contract is void under mistake

D. The contract is voidable under misrepresentation

8. Which of the following best describe a contract made under undue influence?

A. An old woman sells her bungalow worth RM1.2 million to her nephew for RM1 million

B. An illiterate man transfers a house to his 15-year-old daughter

C.A 19-year-old student borrows RM30,000 from a bank to pay for her university fees

D.A terminally ill person sells his brand-new car to his nurse for RM5,000

9. Bella made a contract to sell her land to Ramona for RM160,000. After the contract was concluded, they agreed to modify the price of the land and entered into a new agreement for the sale of the land at the price of RM150,000. The first contract between Bella and Ramona has been discharged by

A. rescission

B. frustration

C. agreement

D. breach of contract

10. Anak Seni is a dance group that has contracted to perform at Adiwara Club for 3 months. They promised that they will not perform at other venues during that period, but they broke the promise when they accepted an invitation to perform at Rafflesia Lounge for 1 week. What is the best remedy for Adiwara Club?

i. Terminate the contract with Anak Seni

ii. Claim for specific performance

iii. Apply for an injunction

iv. Sue for damages

A. i, ii and iii

B. i, iii and iv

C. ii, iii and iv

D. i, ii, iii and iv

11. Sofi tells Lim that she is Ashraf's agent and Ashraf does not deny this. In this situation, if Lim makes a contract with Sofi, would Ashraf be liable to Lim under the law of agency?

A. Yes, because he has expressly appointed Sofi as his agent

B. Yes, because he has held out Sofi as his agent

C. No, because Sofi was the one who claimed to be an agent

D. No, because he never authorised Sofi to contract with Lim on his behalf

12. Mastura works as a cook in Restoran Makan Sedap. Mastura frequently orders vegetables and meat for the restaurant from Kedai Runcit Alang. Restoran Makan Sedap has always paid for the goods delivered by Kedai Runcit Alang. This describes the creation of agency by

A. express appointment

B. implied appointment

C. ratification

D. necessity

13. Siva has been appointed as an agent by Ah Chong. He has the authority to sell goods on credit to third parties. He sold goods amounting to RM20,000 to Rahimi on credit without making proper enquiries on Rahimi's ability to pay. Unknown to Siva, Rahimi had been declared bankrupt at the time he supplied the goods to Rahimi. Which of his duties as an agent has Siva breached?

A. Duty to obey the principal's instructions

B. Duty to exercise care and diligence

C. Duty to communicate with the principal

D. Duty to render proper account to the principal

14. Ronald instructed his agent Edward to purchase a second hand van for not less than RM40,000. Edward made a contract to purchase Ah Chong's van for RM32,000. Edward and Ah Chong agreed to make the price of the van appear as RM40,000 in their agreement. They then divided the additional RM8,000 equally between them. Ronald has found out about the deal between Edward and Ah Chong. He wants to know what he can do about it.

i. Ronald may recover the additional money received by Edward

ii. Ronald may terminate the services of Edward

iii. Ronald may refuse to pay Edward's remuneration

iv. Ronald may seize Edward's property as compensation for his losses

A. i, ii and iii

B. i, ii and iv

C. i, iii and iv

D. ii, iii and iv

15. Which of the following situations will result in an automatic termination of an agency?

A. Rafi who is 17 years old was appointed by Halim to sell his watch

B. Jason who is the principal of Darrell has been declared bankrupt

C. Ying appointed Joe to manage a book store for him but Joe had to be hospitalised for two months after he was diagnosed with Covid 19

D. Kavita purchased an apartment for Datin Suhana and received a secret commission of RM5,000 from the seller

16. Which of the following statement is NOT TRUE about a hire purchase agreement?

A. A hirer does not obtain legal ownership of the goods until the final payment is made.

B. It is a breach of the hire purchase agreement if a hirer sells the goods before completing the payment

C. The owner may keep the goods in his possession until the hirer completes the payment of the hire purchase

D. A hirer is legally bound to observe all the terms in the hire purchase agreement

17. Amara entered into a hire purchase agreement for a sewing machine, a vacuum cleaner, and a rice cooker from Senang Finance. The monthly instalment for each item is RM100. This month, Amara is only able to pay RM100 to Senang Finance and she wishes to pay for the sewing machine. Which of the following describes the legal position in Amara's situation?

A. Amara has the right to choose which item she wishes to pay

B. Amara must obtain the consent of the owner on which item she has to pay

C. The owner has the right to choose which item Amara should pay

D. Amara must apply to the court for permission to choose which item she wishes to pay

18. Salman entered into a hire purchase agreement for a car with the following description "Proton X70, automatic, white colour, leather seat cover". When the car was delivered, Salman found that the colour of the car was red and only the front seats had leather cover. What action may Salman take against the owner in this situation?

A. Salman may repudiate the agreement

B. Salman may sue for damages

C. Salman may repudiate the agreement and sue for damages

D. Salman cannot take any action against the owner

19. Which of the following are the rights given to a hirer after the repossession of goods by the owner?

i. The hirer may refuse to settle the default payment

ii. The hirer may pay the amount in default together with the costs of repossession

iii. The hirer can regain possession of the goods after remedying the default

iv. The hirer may request the owner to sell the goods to a person introduced by the hirer for cash at a price of not less than the estimated value of the goods

A. i, ii and iii

B. i, iii and iv

C. ii, iii and iv

D. i, ii, iii and iv

20. Awang entered into a hire purchase agreement with Syarikat Senang Beli for a car. The price of the car in the hire purchase agreement is RM88,674.00. Awang has failed to pay the last two successive instalments. Syarikat Senang Beli wishes to repossess the car. However, Awang has already paid more than RM70,000 to Syarikat Senang Beli. Can Syarikat Senang Beli repossess the car?

A. Yes, because Awang has defaulted in two successive payments

B. Yes, because it is the right of an owner to repossess goods after a hirer has defaulted in payment

C. No, because Awang has not defaulted in four successive payments

D. No, because the Hire Purchase Act 1967 does not allow direct repossession of goods by the owner in this situation