Educads publishes fully funded scholarships, Internships, Free online Courses , Job opportunities for all from around the world.

Mercantile Law Paper, 2013

Q: 1 Part 1 Objective


(i) Select the best option/ answer and fill in the appropriate Circle on the OMR
Answer Sheet.( 20×1=20)
(ii) Answers given anywhere, other than OMR Answer
Sheet, shall not be considered.

1. Jurisdiction in company matters is to
be exercised by:
(a) Civil Court
(b) Any judge of high court
Company Bench of High Court
(d) None of These

2. Any alteration in
Article of Association affecting the substantive right or liabilities of members
of the company can be made
(a) If Board of Director pass such
(b) By vote of simple majority of members
(c) By a vote ¾
majority of members
(d) None of these

3. A special audit of a company
can be ordered by a commission on an application made by members holding not
less than
(a) 20% Voting Rights
(b) 25% Voting Rights
(c) 51% Voting
(d) None of these

4. A listed company in accordance with
companies ordinance is required to have at least:
(a) Two director
Seven director
(c) Three Directors
(d) None of these

5. When a
negotiable instrument may be construed either as a promissory note or bill of
exchange, law recognizes it as:
(a) Promissory note
(b) Bill of
(c) Ambiguous Instrument
(d) (d) None of these

6. When a
bill of exchange has been dishonored, the holder can cause such dishonor be
certified by a notary public, such certificate is a:
(a) Claiming
(c) Protest
(d) None of these

7. If a cheque is
transferred to any person to constitute him as a holder, the instrument is said
to be:
(a) Delivered
(b) Negotiated
(c) Presented
(d) None of

8. A partner can be expelled from a Firm:
(a) By simple majority
of partners
(b) If all partner consent to it
(c) Only by exercise of
powers conferred by the Contract
(d) None of these

9. A new
partner can be inducted in an existing partnership:

(a) By recommendation
of any partner
(b) By the consent of all partners
(c) By the consent of
half of the partners
(d) None of these

10. Any admission made by a
partner regarding the affairs of the firm in ordinary course of business:
Is evidence against the firm
(b) Has no validity against the firm
Ordinary statement
(d) None of these

11. An agreement between partners
imposing reasonable restriction on a partner for not carrying on any business
within a specified time or local limits on ceasing to be a partner is:
(b) Valid
(c) Illegal
(d) None of these

12. The goods
which form the subject of a sale can be:
(a) Existing Goods
(b) Existing
and future Goods
(c) Existing, Future and Contingent Goods
(d) None of
13. If the seller make use of pretended bidding to raise the price the
sale is:
(a) Voidable
(b) Void
(c) Illegal
(d) None of

14. The principle of indemnity does not apply in the case
(a) Life Insurance
(b) Marine Insurance
(c) Fire Insurance
None of these

15. Promise which form the consideration or part of the
consideration for each other are called:
(a) Agreement
(b) Contract
Reciprocal Agreement
(d) None of these

16. Mr. Aslam applied to a bank
for a loan at a time when there is stringency in the money market, the banker
declines to make the loan except at an unusually high rate of interest, this is
(a) Undue influence
(b) Transaction in the ordinary course of
(c) Free consent
(d) None of these

(17) When consent to an
agreement is caused by coercion, fraud, or misrepresentation, the agreement
(a) Valid
(b) Void
(c) Voidable
(d) None of these

(18) A
person who finds goods belonging to another and takes them into his custody; is
subject to the same responsibilities as:
(a) Trustee
(b) Owner
(d) None of these
(19) An agreement in restraint of the marriage of
any person other than a minor is called:
(a) Valid
(b) Invalid
(d) None of these

(20) Authority of any appointed arbitrator
or umpire can be revoked:
(a) At the discretion of either party
(b) With
the leave of the court
(c) Irrevocable
(d) None of


Attempt only four

Q.2. Discuss the methods for discharge of contract
and clarify discharge by operation of law and Discharge by Agreement with

Q.3 Distinguish between winding up and dissolution.
Under what circumstances the Court can order the Compulsory winding up of a
company and in what circumstance may a company be wound up

Q.4. Distinguish between condition and warranty.
Suppose Mr. Imran shopping in a self-service market, he picked up a bottle of
Maka cola from a shelf. While he was examining it, the bottle exploded in his
hand and injured him. Can Mr. Imran claim damages for the

Q.5. Define partnership deed and describe its

Q.6. Write essay on any two of the following.
Undue Influence
(b) Memorandum of Association
© Presumptions as to
negotiable Instruments

Q.7. Write comprehensive note on any two of
the following:
(a) Implied authority of partner as agent of the firm
Sale by person not the owner
© Crossing of Cheque

Q.8. Write
Short notes on any Four of the following
(a) Fraud
(b) Associated
(c) Cases when presentment of a bill of exchange is excused
Mode of determining existence of partnership
(e) How unpaid seller stop goods
in transit
(f) Re-Insurance