1) A Continuing guarantee may be revoked for further transactions :

A) Before five months

B) Within three months

C) At any time

D) May not be revoked

Answer : C 

2) A, B and C as sureties for D, enter into three several bonds, each in a different penalty, namely, A in the penalty of 10,000 rupees. B in that of 30,000 rupees, C in that of 50,000 rupees, conditioned for D's duly  accounting to E. D makes default to the extent of 30,000 rupees, A, B, C liable to pay :

A) In ratio 1 : 3 : 5

B) Only B is liable

C) Each liable to pay 10,000 rupees

D) Only C is liable

Answer : C

3) A, B and C are sureties to D for the some of 3,000 rupees lent for E, E makes default in payment. A, B, C are liable

A) To pay 1,000 each

B) Only B is liable

C) Only C is liable

D) Only D is liable

Answer : A

4) Section 133 of Indian Contract Act 1872 provides :

A) Discharge of Surety by variance in terms of a contract

B) Surety's  liability

C) Release of one cosurety does not discharge other

D) Implied promise to indemnity Surety

Answer : A

5) In contract of guarantee, the person who gives the guarantee is known as :

A) Debtor

B) Surety

C) Creditor

D) Principal debtor

Answer : B


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