Mercantile Law

EXAMINATION, 2004 MERCANTILE LAW. TIME ALLOWED: THREE HOURS MAXIMUM MARKS: 100 NOTE: Attempt FIVE questions in all including QUESTION No.8 which is COMPULSORY. Allquestions carry EQUAL marks. 1. A firm of building contractors had contracted to build 50 houses in 10 months. The work took 20 months to complete because of the lack of skilled labour. The contractors pleaded that the contract price was not bninding on them, and that they were entitled to 3 greater sum on the basis of a quantum meruit in view of the extra labour costs involved because the contract had been frustrated. What are you Comments? 2. Mr. Zulfiqar was offered the post of Professor of Law at X University on the condition that he would get his practicing licence cancelled to cease law practice. Mr. Zulfiqar did not agree to cease to practice. On this the University authorities refused to employ him in the post. Can Mr. Zulfiqar succeed in the suit brought by him against the University for getting the job? Explain. 3. A company had power under its * Memorandum'—"to sell or lend all kinds of railway plant and to carry on the business of mechanical engineers and contractors". Its directors agreed to build a dam to produce hydra 1 power in country T and this agreement was ratified by the company. Develop your answer keeping in view the legal importance of the object clause in a memorandum of a company. 4. A. the holder of a bill transfers it to B, without consideration. B also transfers it to C without consideration. C transfers to D for value. D transfers it to* E without consideration. Discuss the rights of E against A, B, C and D. 5. Write a detailed note on the different modes of dissolution of a firm. 6. Discuss the law regarding appointment of Umpire. Can the court remove the umpire and under what circumstances? 7. Is the insurer liable in the following cases? (a) A takes a policy on his life and later commits suicide. (b) A takes a policy on his wife's life and discovers her She dies.

(Mercantile Law) TIME ALLOWED: 3 HOURS MAXIMUM MARKS: 100 NOTE: Attempt FIVE questions in all, including Question No.8 which is Compulsory. All questions carry equal marks. 1. What are the various kinds of shares? Briefly give distinctive features of each. 2. Under what circumstances will a banker be justified in dishonoring a cheque of a customer? 3. Discuss advantages and disadvantages of registration and non registration of a firm. 4. (a) Explain 'consideration' as an element in a valid contract. State the exceptions to the rule that an agreement without consideration is void. (b) Should consideration always move from the promisee? 5. State the various modes in which a contract may be discharged and the modes in which a man may be discharged from the obligations of a contract. 6. (a) Explain the position and rights of a minor under the law of partnership. (b) What are the powers and duties of an arbitrator? 7. Explain the general rule that no one can give a better title than he himself possesses. Discuss and illustrate the exceptions to this rule. COMPULSORY QUESTION 8. Write only the correct answers in the Answer Book. Don’t reproduce the questions. (1) Payment can be made on a Bill of Exchange to: (a) Its bearer (b) Only to a person specified therein (c) None of these. (2) How a cheque is treated by a banker among the following when the balance at credit of drawer is found insufficient" (a) Be dishonored. (b) Be honored partly (c) Be treated a request for loan by way of an overdraft. (3) 'Accommodation Party’ is a person who has signed a negotiable instrument: (a) On receiving the value thereof. (b) Without receiving the value thereof. (c) None of these. (4) Which of the following is correct:

(a) A Provincial Government can constitute a Corporate Law Authority. (b) The minimum number of members of the Corporate Law Authority is five (c) None of these. (5) Which of the following is correct: (a) Any member of a Public limited Company can appoint more than one proxy to attend any meeting. (b) A proxy must be member of the company (c) None of these. (6) Good will: (a) can be sold separately from other property of a firm. (b) cannot be sold separately. (c) is not saleable commodity. (7.) When undue influence is used in a contract by one party against the other, the contract becomes: (a) void (b) void able (c) illegal (8) Which of the following is correct: (a) The bailee can mix the goods of the bailor with his own goods under the law: (b) cannot mix (9) Pledgor or Pawnor are: (a) same persons (b) different persons (10) The principal must ratify the contract: (a) as a whole (b) in part. (11) A dormant partner is one: (a) who is found sleeping during meeting of a firm. (b) whose name does not appear in any way as partner. (c) is not liable for the debts of the partnership. (d) none of these. (12) Caveat Emptor means: (a) Preemptor against sale of goods. (b) the seller is duty bound to point out the defects in the goods. (c) The buyer should be aware of the suitability of goods for his purpose. (13) If the seller of immovable property has effected a fire insurance policy in respect of the property, the purchaser, of the property: (a) cannot claim any benefit of it. (b) can claim benefit as transferee of the property. (14) The delivery of the insurance policy to the assured is:

(a) essential to make binding contract. (b) not essential (c) to accept the terms of the policy by the insurer. (d) none of these. (15) The grace period for every instrument payable at a specified period after date or after sight is: (a) 15 days (b) 3 months (c) 3 days. (16) Special Resolution is passed at a general meeting of a Public Company when not less than the following notice has been given: (a) 30 days notice (b) 15 days notice (c) None of these. (17) One of the special privileges of a Private Limited Company is that: (a) there is restriction on the right of members to transfer their shares. (b) there is no restriction on the transfer of shares. (18) A company shall be eligible for registration as a Modaraba Company if its paid-up capital is not less than: (a) 2 million rupees. (b) 3 million rupees. (c) 2.5 million rupees. (19) A and B are partners. A buys land with partnership moneys for his sole benefit. Thereafter, A debits himself in the firm books and becomes a debtor to the firm for the amount of the purchase money. The purchased property is: (a) partnership property. (b) not partnership property. (20) Whether a partner has got power to assign his partnership interest to any other person so as to make him a partner in the business? (a) Yes (b) No ***************************