PVL3702 LATEST
EXAM MCQ.
100% CORRECT Q
AND A.
PVL3702 Law of Contract: MCQ
NOTE: Most answers are personal or own answers to MCQ from various examination papers and
tutorial letters. There might be a few that are incorrect, however most are answered as from the Study
Guide and prescribed ma...
NOTE: Most answers are personal or own answers to MCQ from various examination papers and
tutorial letters. There might be a few that are incorrect, however most are answered as from the Study
Guide and prescribed material.
1. Z walks into a shop, puts R10 on the counter and points at a packet of sweets. X (the owner of
the shop) takes the money and hands over the sweets to Z. Which statement is CORRECT?
1. There is an oral offer and acceptance by conduct.
2. There is an express offer and an oral acceptance.
3. There is both an offer and acceptance by conduct.
4. There is an offer by conduct and an express oral acceptance.
5. There is a firm oral offer and an unqualified acceptance.
Answer: 3. There is both an offer and acceptance by conduct.
Note: There is neither an oral offer, not an oral acceptance. No words were exchanged between the
parties. The placing of the R10 on the counter and pointing at the sweets constitutes and offer
by conduct. X taking the money amounts to an acceptance by conduct.
2. C, an owner of an exclusive bicycle shop, advertised a special limited edition bicycle for sale and
invited the public to make offers for the bicycle. J and P were among other people who submitted
written offers for the bicycle. J’s offer was for R150 000 and P’s offer was for R160 000. Although
C intended to accept P’s offer, she erroneously accepted Jane’s offer. C’s mistake is:
a. Not material.
b. An error in persona.
c. An error in motive.
d. Material.
1. a.
2. b.
3. c.
4. b. and d.
5. a., b. and c.
Answer: 4. b. and d..
Note: b. is correct because there if a mistake relating to the identity of the parties with whom C
intended to contract with (an error in persona). C’s mistake was materially (d.) because she
inadvertently accepted the offer of one party (J), whereas she intended to accept the offer of a
completely different party (P).
The facts in this problem are similar to the facts in National and Overseas Distributors
Corporation (Pty) Ltd v Potato Board 1958 (2) SA 473 (A), where the Appellate Division found
that the mistake was material.
c. is incorrect as the error did not relate to C’s reason for concluding the contract.
3. C, an owner of an exclusive bicycle shop, advertised a special limited edition bicycle for sale and
invited the public to make offers for the bicycle. J and P were among other people who submitted
written offers for the bicycle. J’s offer was for R150 000 and P’s offer was for R160 000. Although
C intended to accept P’s offer, she erroneously accepted J’s offer. C’s mistake is material. Which
statement(s) is/are CORRECT?
a. C’s error was an iustus error.
b. C’s error was not an iustus error.
, c. C misrepresented her intention to J by accepting J's offer.
d. C by accepting J’s offer, led J to reasonably believe that they had reached consensus.
1. a.
2. b.
3. c. and d.
4. b. and c.
5. b., c. and d.
Answer: 5. b., c. and d.
Note: The requirements for both iustus error and the doctrine of quasi mutual assent are relevant
when answering this question.
A mistake is an iustus error if it is both material and reasonable. It has already been
established that the error was material. The issue now is whether the mistake was also
reasonable. In National and Overseas Distributors Corporation (PTY) Ltd v Potato Board
1958 (2) SA 473 (A), the court ruled under similar circumstances that the mistake by the
contract denier was not reasonable. The mistake furthermore does not fall into one of the
recognised categories of reasonable mistakes. Therefore option b. is correct.
Options c. and d. relate top the requirements for the doctrine of quasi-mutual assent. This
doctrine requires that the one party reasonably believes that the other party had agreed to
enter into the contract and that this belief must have been caused by the letter party. C made
a misrepresentation to J that she wanted to conclude a contract with J by accepting J’s offer
and this led J to reasonable believe that consensus had been reached between the parties.
Therefore both options c. and d. are correct.
See application of the doctrine of quasi=-mutual assent to the facts of National and Overseas
Distributors Corporation (PTY) Ltd v Potato Board 1958 (2) SA 473 (A).
4. C, an owner of an exclusive bicycle shop, advertised a special limited edition bicycle for sale and
invited the public to make offers for the bicycle. J and P were among other people who submitted
written offers for the bicycle. J’s offer was for R150 000 and P’s offer was for R160 000. Although
C intended to accept P’s offer, she erroneously accepted J’s offer. Which case has similar facts?
1. National and Overseas Distributors Corporation (PTY) Ltd v Potato Board 1958 (2) SA
473 (A).
2. Brink v Humphries & Jewell (Pty) Ltd 2005 (2) SA 419 (SCA).
3. George v Fairmead Hotel (Pty) Ltd 1958 (2) SA 465 (A).
4. Du Toit v Atkinson’s Motor Bpk 1985 (2) SA 893 (A).
5. Alien v Sixteen Stirling Investments (Pty) Ltd 1974 (4) SA 164 (D).
Answer: 1. National and Overseas Distributors Corporation (PTY) Ltd v Potato Board 1958 (2)
SA 473 (A).
5. G points a loaded gun at P and orders him to sign a written contract. G explains that the
document is for the sale of P’s car to him (G) at a price of R50 000 which is far below the market
value of the car. P, fearing for his life, signs the document. To establish a cause of action, which
of the following is NOT necessary for P to prove?
1. That P had reasonable fear.
2. That the threat weakened P’s power of resistance and rendered his will compliant.
3. That there was a threat of an imminent evil.
4. That the threat was contra bonos mores.
5. That the pressure G used caused damage.
Answer: 2. That the threat weakened P’s power of resistance and rendered his will compliant.
Note: The requirements for duress are relevant to this question, as it appears that P did not freely
conclude the contract, but through fear for his life.
Options 1, 3, 4 and 5 are all requirements that must be present to prove a cause of action
based on duress.
, Option 2 is not a requirement to prove duress, instead it has a similar wording to a
requirement which is necessary to prove undue influence.
6. X has a watch that Y likes. X offers to sell her watch to Y for R1 000 and X and Y agree that X’s
offer will be open to acceptance until 1 June. This is a case of:
1. a pre-emption formed unilaterally
2. an option formed bilaterally.
3. an option formed unilaterally.
4. neither an option, nor a pre-emption.
5. a pre-emption formed bilaterally.
Answer: 2. an option formed bilaterally.
7. X has a watch that Y likes. X offers to sell her watch to Y for R1 000 and Y accepts this offer. X
and Y agree that they will reduce their contract to writing and that they will both sign it (“the writing
clause”). The parties reduced their contract to writing, but failed to sign it. Which statement(s)
is/are CORRECT?
1. The law presumes that X and Y intended the writing clause to facilitate proof of the terms of
their contract, because there is doubt about what the intended purpose of X and Y was with
the inclusion of the writing clause in the contract.
2. There is no binding contract because the formalities created by X and Y were not complied
with.
3. The writing clause also constitutes a non-variation clause.
4. A binding contract was concluded even though X and Y only partially complied with the
writing clause.
5. Options 1 and 4.
Answer: 5. Options 1 and 4.
8. S negligently informs P that there are 1 000 fruit trees on S’s farm, as a result of which P buys the
farm for R8 000 000. P pays R8 000 000 and the farm is registered in P’s name. It is later found
that there are only 800 fruit trees on the farm. P would not have bought the farm had she known
the truth about the number of fruit trees, but decides nevertheless to uphold the contract. The
value of the 200 missing fruit trees is R500 000. The market value of the farm is R7 800 000. The
farm would have been worth R8 400 000 if it had 1 000 fruit trees on it. What amount will P be
able to claim from S based on negligent misrepresentation? (Do not apply the Consumer
Protection Act to this question)
9. S negligently informs P that there are 1 000 fruit trees on S’s farm, as a result of which P buys the
farm for R8 000 000. P pays R8 000 000 and the farm is registered in P’s name. It is later found
that there are only 800 fruit trees on the farm. P would not have bought the farm had she known
the truth about the number of fruit trees, but decides nevertheless to uphold the contract. The
value of the 200 missing fruit trees is R500 000. The market value of the farm is R7 800 000. The
farm would have been worth R8 400 000 if it had 1 000 fruit trees on it. P’s claim against S is
based on:
1. delict.
2. breach of contract.
3. unjustified enrichment.
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