AEREN FOUNDATION’S Maharashtra Govt. Reg. No.: F-11724
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SUBJECT : Corporate
Law
COURSE : GDM 2nd Sem Total Marks : 80
Q.1 In the following statements only one is
correct statement. Explain Briefly?
i)An
invitation to negotiate is a good offer.
ii)A
quasi-contract is not a contract at all.
iii)An
agreement to agree is a valid contract.
Answer:
A quasi-contract is not a
contract at all
A quasi-contract (or implied-in-law
contract) is a fictional contract created by courts for equitable, not
contractual purposes. A quasi-contract is not an actual contract, but is a
legal substitute for a contract formed to impose equity between two parties.
The concept of a quasi-contract is that of a contract that should have been
formed, even though in actuality it was not. It is used when a court finds it
appropriate to create an obligation upon a non-contracting party to avoid injustice
and to ensure fairness. It is invoked in circumstances of unjust enrichment,
and is connected with the concept of restitution.
Q.2.A
ship-owner agreed to carry to cargo of sugar belonging to A from Constanta to
Busrah. He knew that there was a sugar
market in Busrah and that A was a sugar
merchant, but did not know that he intended to sell the cargo,
immediately on its arrival. Owning to
Shipment’s default, the voyage was delayed and sugar fetched a lower price than it would have done had it
arrived on time. A claimed compensation
for the full loss suffered by him because of the delay. Give your decision. Explain
Briefly?
Answer:
A can claim ordinary damages. Loss of profits is a special less and can
be claimed only if the other party was aware of the possibility of such a loss
(Sec. 73).
In the absence of any explicit
communication, we have to infer what could have been in the contemplation of
the parties from their actions. The court reasoned that the carriers had no way
of knowing that a would loose
Q.3.The
proprietors of a medical preparation called the “Carbolic Smoke Ball” published
in several newspapers the following advertisement:-“£ 1000 reward will be paid
by the Carbolic Smoke Ball Co. to any person who contracts the increasing
epidemic influenza after having used the Smoke Ball three times daily for two
weeks according to printed directions supplied with each ball. £ 1000 is
deposited with the Alliance Bank showing our sincerity in the matter. On the
faith in this advertisement, the plaintiff bought a Smoke Ball and used it as
directed. She was attacked by influenza.
She sued the company for the reward.
Will she succeed? Explain Briefly
Answer:
She (Mrs. Carlill) was held entitled to the announced reward of £1000.
A general offer may be accepted by any person doing the stipulated act (Carlill
vs Carbolic Smoke Ball Co.).
She will not succeed. The facts show that
there was no binding contract between the parties. The case is not like,
Williams v carwardine H.B Ad 621 where the money was to become payable on the
performance of certain acts by the plantiff, here the plantiff could
Q.4.
Fazal consigned four cases of Chinese crackers at Kanpur to be carried to
Allahabad on the 30th May,1987. He intended to sell them at the Shabarat
festival of 5th June 1987. The railway discovered that the consignment could
not be sent by passenger train and asked Fazal either to remove them or authorize
their dispatch by goods train. He took no action and the goods arrived at
Allahabad a month after they were booked. Fazal filed a suit against Railways
for damages due to late delivery of the goods which deprived him of the special
profits at the festival sale. Decide & explain briefly ?(5 Marks)
Answer:
Fazal shall not be entitled to
Q.5.
‘Lifeoy’ Soap company advertised that it would give a reward of Rs. 2000 who
contracted skindisease after using the ‘Lifeoy’ soap of the company for a
certain period according to the printeddirections. Mrs. Jacob purchased the
advertised ‘Lifeboy’ and contracted skin disease inspite ofusing this soap
according to the printed instructions. She claimed reward of Rs. 2000. The
claim isresisted by the company on the ground that offer was not made to her
and that in any case she hadnot communicated her acceptance of the offer.
Decide whether Mrs. Jacob can claim the reward ornot. Give reasons. Explain
briefly?
Answer:
Mrs. Jacob can claim, the reward. General offer may be accepted by any
body [Carlill vs Carbolic Smoke Ball Co.].
Q.6.
In each set of statements, only one is correct.
State the correct statements &
Explain briefly?
A)
I)A bailed has a general lien on the goods bailed.
Answer
: A bailed has a
ii)The
ownership of goods pawned passes to the Pawnee.
Answer
: The ownership of good pawns passes to is
incorrect statement. For ownership to
pass, goods must be specific ownership in goods cannot pass till the goods are
curtained.
iii)A
gratuitous bailment can be terminated by the bailer even before the stated time.
Answer : A
gratuitous bailment can be
b)
i) A substituted agent is as good an agent of the agent as a subagent.
ii)
An ostensible agency is as effective as an express agency.
iii)
A principal can always revoke an agent’s authority. (5 Marks)
B)I)A
substituted agent is as good an agent of the agent as a sub-agent.
Answer : A substituted agent is as good an
agent of the agent as a sub agent is
incorrect statement. The general rule is that an agent can’t delegable
his authority and appoint another agent. An agent being delegates cannot
transfer in
ii)
An ostensible agency is as effective as
an express agency.
Answer
: An ostensible agency is an effective as an
ostensible authority exist where the principles words or conduct would lead a
reasonable person in a 3rd party’s position to believe that the agent was
authorized to act, even if the
iii)A
principal can always revoke an agent’s authority.
Answer
: A principal can always revoke an agents authority
is incorrect statement. However, principal cannot revoke agency coupled with
Q.7.
A, an unpaid seller, sends goods to B by railway. B becomes insolventAnd A
sends a telegram to Railway authorities not to deliver the goods to B. B. goes
to the Parceloffice of Railway Yard and by presenting R. R. (Railway Receipt) takes
delivery of the goods andstarts putting them in the cart. Meanwhile the Station
Master comes running with the telegram inhand and takes possession of the goods
from B. Discuss the rights of A and B to the goods in possession of Railway
authorities. (5 Marks)
Answer:
ABC has purchased
goods on behalf of the principal either with his own
funds, or by incurring a personal liability for the price, he
Q
.8. X needs Rs. 10,000 but cannot raise
this amount because his credit is not good enough. Y whose credit is good accommodates. X by giving him a promote made out in favor
of X, though Y owes no money to X. X
endorses the promoter to Z for value
received. Z who is holder in due course
the promoter to Z for value received. Z
who is holder in due course demands payment from Y. Can refuse and plead the arrangement between
him and X Explain briefly?
Answer:
According to sec 120 of the negotiable instrument act, e stoppets
against denying original validity of instrument, No maker of a
Q.9.
Will C has the right of further negotiation in the following cases: (B signs
the endorsements) Explain briefly? (5 Marks)
i)
‘Pay C for my use’
ii)
‘Pay C’)
iv)
‘Pay C or order for the account of B’
Answer:
The endorsement of a negotiable instrument followed by delivery
transfers to the endorsee the property therein with the right of
Q.10. A promissory note was made without
mentioning any time for payment.
The holder added the words’ on
demand on the face of the instrument. State
whether it amounted to material alteration and explain the effect of such alteration.
Explain briefly?
Answer:
This is not note material
Q.11. State
whether the following instruments are valid promissory notes:
I)I
promise to pay Rs. 5000 to B on the dearth of ‘B’s uncle provided that D in his
will gives me a legacy sufficient for the promise of payment of the said
sum.
ii)I
hereby acknowledge that I owe X Rs. 5,000 on account of rent due and I agree
that the said sum will be paid be me in regular installments. I acknowledge myself indebted to B in Rs.
5000 to be paid on demand for value received.
Answer: i)It is not a promissory note
because it does not contain an unconditional promise; the amount being payable
only if uncle gives
Q.12. A Payee holder of a bill of exchange. He endorses it in blank and delivers it to B.
B endorses in full to C or order.
C without endorsement transfers the
bill to D. State giving reasons
whether D as bearer of the bill of exchange is entitled to recover the payment
from A or B or C. Explain briefly?
Answer : D is the bearer and the holder of
the bill in case of dishonor of the bill, D is entitled to receive payment or
recover the money by suit from the
Q.13. Write a short note on the Doctrine of
Indoor Management? Explain briefly?
Answer :
Memorandum of association and articles of association are two most important document needed for the
incorporation of a company. The memorandum of a company is the constitution of
that company. It sets out the (A) Object
(B) Name Clause (C)
Registered office clauses (D)
Liability Clauses (E) Capital Clauses whereas the articles of association
enumerate the internal rules of the
company under which it will be governed Undoubtly , both memorandum of
association and the articles association
are public documents in
Q.14. The shareholders at an annual general
meeting passed a resolution for the payment of dividend at a rate higher than
that recommended by the Board of Directors.
Examine the validity of the resolution. Explain briefly?
Answer: Dividend : According to
regulation 85 of Table A of the companies Act 1956, a company in general
meeting may declare dividend recommended by the board of the director of the
company. The share holders at an annual general meeting may reduce the amount
of dividend , recommended by the board of direction of the of the company
Q.15.
In a prospectus issued by a company the Managing Director stated that the
company had paiddividend every year during 1921 – 27, which was a fact.
However, the company had sustained lossesduring the relevant period and had
paid dividends out of secret reserves accumulated in the past.Examine the
consequences of the observation made by the Managing Director. Explain
briefly?(5 Marks)
Answer : Prospectus is a formal legal
document, which is required by and filed with the Securities and Exchange
Commission, that provides details about an investment offering for sale to the
public. A prospectus should contain the facts that an investor
Q.16.
A buys from B 400 shares in a company on the faith of a share certificate
issued by the company. Atender to the company a transfer deed duly executed
together with B’s share certificate. Thecompany discovers that the certificate
in the name of B has been fraudulently obtained and refuses toregister the
transfer. Advise A. Explain briefly? (5 Marks)
Answer : A deed in lieu of foreclosure
(lieu deed) is a conveyance, by the owner of property encumbered by a mortgage,
to the mortgagee, in full satisfaction of the obligation secured by the
mortgage.The mortgagee takes title to the property subject to existing claims
or liens affecting the property, but the mortgage is not merged with the
lender's title to the property. Id. Acceptance of a lieu deed terminates the
liability of the borrower and all other persons liable for the mortgage debt
unless there is an agreement to the contrary made contemporaneously with the
lieu deed transaction. Id. The terms and conditions under which a borrower will
grant and a lender will accept a deed in lieu of foreclosure are highly
negotiable and will depend on the rela
Q.17.
A insured his house against fire. Later while insure, A killed his wife,
severely injured his only son,set fire to the house and died in the fire. The
son survived and sued the insurer for the fire loss,advice the insurer. Explain
briefly? (5 Marks)
Answer : Because the fire was set
deliberately they would not cover the cost. It was not accidental and as the son did not insure
himself, if the insurance company will not
pay out and I believe they would not because it was not a tenant,
therefore, they
Q.18.
a) Satrang Singh admitted his only infant son in a private nursing home. As a
result of strong dose ofmedicine administered by the nursing attendant, the
child has become mentally retarded. SatrangSingh wants to make a complaint to
the District Forum under the Consumer Protection Act, 1986seeking relief by way
of compensation on the ground that there was deficiency in service by
thenursing home. Does his complaint give rise to a consumer dispute? Who is the
consumer in theinstant case? Explain briefly?
Answer:The
Consumer Protection Act, 1986 (in short, ‘the Act’), is a benevolent social
legislation that lays down the rights of the consumers and provides their for
promotion and protection of the rights of the consumers. The first and the only
Act
b)
Smart booked a motor vehicle through one of the dealers. He was informed
subsequently that theprocedure for purchasing the motor vehicle had changed and
was called upon to make furtherpayment to continue the booking before delivery.
On being aggrieved, Smart filed a complaint withthe State Commission under the
Consumer Protection Act, 1986. Will he succeed? Explain briefly?
Answer:In
terms of the provisions contained in the Consumer Protection Act, 1986,
complaints:-
·
Where the value of goods or
services and compensation, if any, claimed below Rs. Twenty Lacs or upto Rs.
Twenty Lacs, can be filed before District Forum.
c)
Brittle and Company, a small-scale industry, sought nursing and financing
facilities from its bankersby means of grant of further advances and adequate
margin money in anticipation of good demandfor its products. In failing to
obtain this and having become sick, it proceeds against its bankersunder the
Consumer Protection Act, 1986, Will it succeed? Explain briefly?(5 Marks)
Answer: The
Disputes Redressal Agencies (District Forums, State Commissions and National
Commission) under the Consumer Protection Act,1986 adjudicate upon the
complaints of consumers relating to defaults in products and
Q.19
Avinash booked his goods with Superfast Freight Carriers at Delhi for being
carried to Firozabad. The goods receipt
note mentioned that all the disputes would be subject to jurisdiction of the
Mumbai Court. Vanish lodged a complaint
for certain deficiency in service against the transporter in the District Forum
at Delhi. Superfast Carriers contested
that District Forum at Delhi had no jurisdiction to entertain the complaint as
the head office of the transporter was at Mumbai and the jurisdiction has been
clearly stated in the goods receipt not.
Is the content nation of the transporter tenable? Explain
briefly?
Answer: The contention of the transporter
is not tenable. This is based on the facts in the pares vs. Rosh an freight carrier case, where
in the national commission has ruled that the parties could not confer
jurisdiction on a Court which had no jurisdiction. The agreement signed between the parties
conferring exclusion jurisdiction on a particular court was of no
Q.20.
X who was working as a truck driver had taken a general insurance policy to
cover the risk ofinjuries for a period from 1.11.1998 to 30.11.1999. He renewed
the policy for a further period of oneyear on 10.11.1999. On the same day, he
met with an accident and suffered multiple injuriesincluding fractures. X
submitted the claim along with documents to the insurance company. Theinsurance
company repudiated the claim on the ground that the premium for the renewed
policy wasreceived in the office only at 2.30 p.m. on 10.11.1999, while the
accident had taken place at 10.00a.m. on that day and hence there was no policy
at the time of accident. Will X succeed if he files acomplaint against the insurance
company for this claim? Explain briefly?(5 Marks)
Answer
: The Department of Insurance makes sure all insurance companies, HMOs,
producers selling insurance in Illinois and other regulated entities obey state
insurance laws. The Department provides consumer information and investigates
complaints
Q.21
Avinash booked his goods with Superfast Freight Carriers at Delhi for being
carried to Firozabad. The goods receipt
note mentioned that all the disputes would be subject to jurisdiction of the
Mumbai Court. Vanish lodged a complaint
for certain deficiency in service against the transporter in the District Forum
at Delhi. Superfast Carriers contested
that District Forum at Delhi had no jurisdiction to entertain the complaint as
the head office of the transporter was at Mumbai and the jurisdiction has been
clearly stated in the goods receipt not.
Is the content nation of the transporter tenable? Explain
briefly?
Answer
: The contention of the transporter is not tenable. This is based on the
facts in the pares vs. Rosh an freight
carrier case, where in the national commission has ruled that the parties could
not confer jurisdiction on a Court which
Q.22.
With reference to the provisions of the Consumer Protection Act, 1986,
decide the following giving reasons
in support of your answer.
I)Such
Duke Ltd. dispatched certain consignments of goods by road through Fastrack
Roadways Ltd. The goods were unloaded and stored in a go down enrooted on the
suggestion of consignee. A fire broke
out in the neighboring go down spread to the go down and goods were
destroyed. The Fastrack Roadways Ltd.
claimed that there was neither negligence nor deficiency in service on their
part and goods were being carried at “Owner risk” and since no special premium
was paid, they were not responsible for the loss caused by fire. Whether Fastrack Roadways Ltd. is liable to
pay damages to consignor?
Answer
: The present problem is based on
nath bros exis international ltd. V best roadways ltd 2000 (2) scale 5ft, where
the national commission dismissed the claim. The supreme court allowed the
appeal and held that the liability of the carrier is that of an insurer and is
absolute in terms in the sense that the carrier has to deliver the good, at
ii)Life
Insurance Corporation (LIC) formulated a scheme called ‘salary saving scheme’
under which employees of an organisation could buy an insurance policy. Premium due on each policy was collected by
the employer from the salary of the employees nor did it issue any premium
notice. When the widow of the deceased
employee made a claim to LIC on the death of her husband, the LIC repudiated
the claim on the ground that four installments of premium had not been
paid. The widow was approached the
consumer forum for redressed. Is the LIC liable for deficiency in service?
Explain?
Answer
: LIC is liable for deficiency in
services. In the instant case the employer had implied authority to called
premium on behalf of the corporation.
iii).
Raman booked a ticket from Delhi to New York by Lufthansa Airlines. The
airport authorities in New Delhi
did not find any fault in his visa and other documents. However, at Frankfurt airport authorities
instituted proceedings of verification because of which Raman missed his flight
to New York. After necessary
verification, Raman was able to reach New York by the next flight. The airline authorities’ tendered apology to
Raman for the inconvenience caused to him and also paid as goodwill gesture a
sum of Rs. 5,000. Raman intends to institute proceedings under the Consumer
Protection Act, 1986 against Lufthansa Airlines for deficiency in service. Will he succeed?
Answer
: The present problem is similar to ravneet singh bagged and KLM royal
dutch Airlines 1999 (7) scale 47. In the present problem lefthansa airlines
could not be held to be quality of clerifency in service. Although roman had
been subjected to
Q.23.With
reference to the provisions of the Consumer Protection Act, 1986, decide t he
following giving reasons in support of your answer.
I)Sohan
sent all relevant documents in an envelope regarding consignment of goods to a
buyer in the USA through Fast Service Couriers.
The documents did not reach the buyer as a consequence of which the
buyer could not take delivery of the goods.
By the time the duplicate copies of the document had been received by
the buyer, the season of the goods was over.
He claimed that he had suffered a loss of US $ 5,000 as a result of the
negligence of the courier. The State
Commission ordered the payment to be made by the Fast Service Couriers, but the
National Commission in appeal reversed the order and ordered payment of US $
100 only as per the receipt issued by the Fast Service Courier to the consignor
at the time of the dispatch of the latter.
Advise Shan.
Answer
: Sohan will not succeed. The liability of Fast Service Couriers will be
limited to the payment of $100 as per the receipt issued by the courier service
to the consignor. The problem is based on Supreme Court decision in Bharathi
Knitting Co. vs
ii)Mahesh
purchased a machine from Astute Ltd. to operate it himself for earning his liver
hood. He took the assistance of a person
to assist him in operating the machine.
The machine developed fault during the warranty period. He filed a claim
in the consumer forum against the company for deficiency in service. Astute Ltd. alleged that Mahesh did not
operate the machine himself but had appointed a person exclusively to operate
the machine. Will Mahesh succeed?
Answer
:Mahesh will succeed. The Supreme Court, in Laxmi Engineering Works vs
P.S.G. Industrial Institute, held that if a person purchased a
iii)Pilli
purchased a car by taking a loan from Kerala cooperative Bank Ltd. and gave
post-dated cheques to the bank not only in respect of repayment of loan installments
but also of premium of insurance policy for two succeeding years. On the expiry
of the policy. Pilli’s car met with an
accident. Will Pilli succeed in getting
a claim against the Bank?
Answer:
Pillai will not succeed. The obligation to renew the policy is on the
owner of the car alone. Merely forwarding cheques to the
Dear students get fully solved
assignments
Send your semester &
Specialization name to our mail id :
“ help.mbaassignments@gmail.com ”
or
Call us at : 08263069601
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