Chapter 5 Self-test questions

. What must be agreed to have a 'concluded bargain'?

The important matters only must be agreed.

Almost all matters must be agreed, with several matters still to be agreed.

Everything which requires agreement must be agreed.

The parties must agree only on price.

. If the parties state that 'time of delivery is to be agreed' but do not express a time of delivery in their contract, how may the court proceed?

The court may imply a term that delivery should occur within a reasonable time.

The court may imply a term that delivery should occur within one year.

The court may not imply a term that delivery should occur within a reasonable time.

None of the above.

. When will a court usually treat a contract as unenforceable for lack of certainty?

Only where the court is unable to determine what the parties intended to agree, or would have agreed to.

Whenever enforcing the contract is not easy.

Whenever the parties have not agreed on all the issues.

The court will always enforce a contract.

. What is generally meant by 'executed' and 'executory' agreements?

Executed agreements have already been performed; performance in executory agreements lies in the future.

Performance in executed agreements lie in the future; executory agreements have already been performed.

Both executed and executory agreements are types of hire purchase contract.

Executed agreements are contracts for hire purchase; executory agreements are contracts for services.

. According to Denning J in British Bank for Foreign Trade v Novinex, how will the court assess the amount payable for performance which has already been completed, but where the parties did not agree on a particular price?

A nominal sum is to be paid.

The contract is unenforceable: the party who has performed cannot recover their costs.

The contract is unenforceable: the party who has performed is entitled to a remedy in unjust enrichment.

A reasonable sum is to be paid.

. What is a 'lock-out' agreement?

An agreement not to negotiate with anyone else for a specified period of time.

An agreement to negotiate with a particular party for a specified period of time.

An agreement not to negotiate with anyone else for an unlimited period of time.

An agreement to negotiate with a particular party for an unlimited period of time.

. Is an agreement in which A agrees to negotiate with B valid?

Yes: it is sufficiently certain to bind the parties.

Yes, provided there is price clause.

No: it lacks the certainty necessary to bind the parties.

No, unless there is a good faith restriction.

. Where the price has not been fixed, can a valid executory contract be concluded?

Yes

No: all terms, including price, must be fixed.

No, unless the parties agree to settle price 'by agreement'.

None of the above.

. If the contract price is to be agreed by two valuers, and the valuers are unable to agree, how might a fair and reasonable price be settled?

By the higher price of the two suggested by the valuers.

By the lower price of the two suggested by the valuers.

By an umpire appointed by the valuers.

The party who pays the money may decide.

. In which of the following circumstances will an agreement be valid?

B makes a positive agreement to negotiate with A.

B and A conclude an agreement, and agree that the price shall be fixed by the parties at a later date.

B and A conclude an agreement to grant a lease to B at a later date.

All of the above are circumstances in which a valid agreement will be found.

. When will a 'subject to contract' clause be found by a court to have been waived?

Always.

Never.

When one party begins to perform the agreement before the formal contract is entered into.

When the conduct of the parties indicates that the clause has been dispensed with.

. If the parties conclude an agreement 'subject to satisfactory survey', can the contract still be binding?

Yes, provided the 'subject to' clause is sufficiently precise and definite to be able to say when it is satisfied.

Yes, provided that the 'subject to' clause does not leave either party with a discretion about whether to go on with the transaction.

Both option (a) and option (b) are correct.

Neither option (a) nor option (b) are correct.

. When may one party waive a 'subject to satisfactory survey' clause?

Always.

Where the clause is for the exclusive benefit of one party.

Where they disagree with the surveyor's findings.

Never.

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