Revision Class

1. Revision Class MERCANTILE LAW

2. Marks Allocation Table

3. Mercantile Law (Last 2 attempts)

4. Marks Allocation inContract Act 1872

5. Basic list of concepts repeat in Syllabus Historical sources of law are not required to be followed unless adopted through legal sources of law. Consensus ad idem Estoppel and Holding Out Law does not accept unjust enrichment A debt returned is valid consideration for a debt given He who comes to equity must do equity Nemodat quod non habet Privity of contract Remedy in breach is intended to put a party in position he/she would have been in as if breach had not occurred. Equitable remedy is only given if damages are not proper remedy. Unless otherwise agreed Notwithstanding any contract to the contrary. Caveat Emptor Joint & Several liability Every person is required to act bona-fide Where liability lies ambiguity must not lie

6. List of special contracts in Contract Act 1872 Quasi Contracts Contract of Guarantee Contract of Indemnity Contract of Bailment Contract of Pledge Contract of Agency

7. Contracts for which consideration is not essential Gifts in near relations made out of love and affection. Agreement to compensate a past voluntary act. Agreement in writing to pay a time-barred debt. Remission and Waiver Contract of Guarantee Contract of Indemnity Contract of Bailment Contract of Agency Trust transaction A minor entered into benefits of partnership Accommodation transaction Acceptor for honour

8. Examination Techniques (ICAP) Controlling the anxiety is the key Arrive early at the exam to avoid panic. Be on your seat atleast 10 minutes before the examinations. This will reduce your anxiety and allow you to sort out issues which may consume your time during the examinations. In the exam, spend 15 minutes wisely in glancing through the paper to make sure you understand the instructions and to decide which questions to answer first. Read the question very carefully until you know exactly what is required Note any special requirements e.g. list, detail, advise, explain, report etc. Budget your time for each question in proportion to the marks given. Stop working on it when that time is up, return to it if you have time to spare. Spending too much time on favorite topic at the expense of others may cost you the exam Repetition of the same point using different descriptions does not fool the examiner & only wastes time The first 50% of the marks of a particular question are the easiest to get; the next 25% are harder; the last 25% are the hardest. If you run out of time: two half answers may get more marks than one full one; jot down the main points to include while they are in your mind and return later. Write clearly so the examiner can read your work. Number answers correctly.

9. Questions…… How to Answer them Possibilities for organizing your information in an exam include: First plan your answer as to how you want to go ahead with your answer Give a clear opening paragraph, present information in a clear order, a final paragraph drawing conclusions/summarizing. The opening paragraph should be linked with final conclusions through one of the following ways: - step by step points where there is a sequence or stage - a main initial point to make an impact which you then develop - Putting different sides of an argument - Grouping theories/concepts through a theme Present your work well. Headings and a good layout make your work easier to read Tables and graphs need to be clear with correct labeling Use practical examples to illustrate the points made subject to the availability of time and requirements of the question. It may not be practical to give examples where only brief answers are required As far as possible give answers in pointers showing the main heading and then describing it in appropriate details as per the requirements of the question. Just by giving pointers you can atleast secure some marks and convey your knowledge to the examiner.

10. Attempting Scenario based question • The reason for the introduction of these types of questions is to discourage rote learning. • It has been noted that most students only give the conclusions in such type of questions. • The most important aspect of giving such questions is to test if you have understood the law. Therefore the key element in such questions is the reasoning for the conclusion and not just the conclusion. • ICAP does not give marks for guessing the conclusion; you have to support your answer. • If you have proper reasoning for the conclusion you will get pass marks even if your conclusion does not match with that of the examiner.

11. Most Common Mistakes • Getting stuck over a single question • Not clearly understanding the requirements of a question • Panic and pressure handling • Not being quick enough • Not resting adequately before the paper • Not planning before attempting the question • Not effective presentation.

12. How to improve presentation Marks that you will obtain for your answers depends on two factors: - what you answered - how you answered Start each new answer on a new page The arrangement should be pleasing to the eyes Write a fairly large and legible handwriting. But you should not try to change your style just for the examinations. You will have to practice it before the examinations Write your headings boldly Use a dark ink and medium pointed nib Leave space between subsections of answers The subject matter should be broken up into small paragraphs Use Apt sub-headings as it attracts the attention to the main divisions of the chapter The sentences should be short and crisp Make cancellations and corrections neatly Insert new words or sentences legibly and in an orderly way Watch your spelling and punctuation as it helps quick reading & prevent misunderstanding

13. Tricky Questions Q.3 (a) Tariq was seriously ill and needed money for his operation. Murad agreed to lend him Rs. 100,000 at 15% per annum. The rate of interest prevalent in the market was 10% per annum. Later, Tariq refused to pay interest in excess of 10% claiming that he entered into the agreement under undue influence of Murad. Do you agree with Tariq? Explain with appropriate reasons. (05) Examiner Comments (Spring 08):Undue influence: For an appropriate answer, a sound knowledge of Section 16 of the Contract Act 1882, particularly of Section 16 (2) and (3) was required. Only a few students could relate the various requisites of undue influence to arrive at their conclusions. Most of them just gave their conclusions without proper reasoning. The students are once again advised to understand that although the final conclusion is an important part of the answer, yet the more important part is the argument which the student gives to support his conclusion.

14. Tricky Questions Q. 4 (b) Bushraenterd into a contract with Akhtar, the manager of a radio programme, to conduct a show, twice a week, during the next three months. Bushra did not appear for the sixth show. She conducted the next show but soon thereafter Akhtar rescinded the contract and informed her that her services were no longer required as she failed to conduct the sixth show. Narrate the rights of Akhtar and Bushra in the above situation. (05) Examiner Comments (Spring 08): This question was based on Section 39 of the Contract Act 1882. Very few of the students were able to put forth the following arguments: • Akhtar could not rescind the contract as he had affirmed the contract when he allowed Bushra to conduct the seventh show. However, he was entitled to claim damages sustained by him through Bushra’s failure to conduct the sixth show. • If Akhtar had put an end to the contract, it would have amounted to breach of contract and remedies of breach of contract would be available to Bushra.

15. Tricky Question Q. 3 (b) Talib was indebted to Bashir for Rs. 10,000. On Talib’s request Bashir agreed to accept Jahangir as his debtor, in place of Talib. Jahangir failed to make payment on due date. Under the provisions of Contract Act, 1872 you are required to explain whether Bashir can now demand payment from Talib. (02) Examiner Comments (Spring 09): The situation given in part (b) required an answer based on section 62 of the Contract Act, 1872. The students were simply required to explain that when parties to a contract agree to substitute it with a new contract, they can not demand the performance of the original contract. Most of the answers were based on Yes/No and very few candidates managed to give the required justification.

16. Tricky Question Q. 5: Anwar and Bashir jointly and severally guarantee the repayment of loan of Rs. 500,000/- given by Qasim to Dawood. Anwar and Bashir mutually agreed that in case of Dawood default Anwar shall be first liable. Dawooddefaulted in payment and Qasim filed suit against Anwar and Bashir. Bashir claimed that he is not liable as surety because of arrangement between him and Anwar. You are required to comment on the claim of Bashir: (a)If Qasim was not aware about the arrangement between Anwar and Bashir. (b)If Qasim was aware about the arrangement between Anwar and Bashir (M 05) Examiner’s Comment (Autumn 04):This question relating to co sureties was poorly answered by a vast majority of the candidates as they failed to apply the provisions of section 132 of the Contract Act to this short case study.

17. Tricky Question Q. 4 (c): A holds a lease from B, which is terminable on three months notice. C, an unauthorized person, gives notice of termination to A. After two months, B ratifies the notice and asks A to vacate the premises. A knows that C has given the notice without authority and claims that the ratification is invalid. On what basis can A make such a claim? (M 02) Examiner’s Comments (Autumn 06):Very few knew that an unauthorized act which has the effect of subjecting a third person to harm/damages cannot be ratified. (Refer Section 200 of Contract Act 1872).

18. Tricky Question Q. 9 (d) Haroon contracted to purchase pineapples from Ismail. It was agreed that Ismail would fill the tins weighing 500 gms each and pack them in cases containing 30 tins each. Ismail’s staff had filled 40% of the pineapples in tins in presence of Haroon when a fire broke out accidentally and the entire stock was destroyed. Ismail contends that Haroon should bear 40% of the loss. Who in your opinion should bear the loss? Discuss with reference to Sale of Goods Act, 1930. (03) Examiner Comments (Autumn 08): This part of the question required practical application of the knowledge. Most of the students failed to derive the correct conclusion that the goods would not be considered to be in a deliverable state unless the tins were also packed in cases.

19. Tricky Question Q. 10 (c): Munir and Naeem purchased a taxi to ply it in partnership. The firm was not registered. The business continued for one year, and then Munir sold the taxi without the consent of Naeem, and did not pay anything to him. Naeem filed a suit against Munir to recover his share in the sale proceeds. You are required to answer the following questions, giving reasons: (i) Whether a partner of an unregistered firm can file suit against the firm or other partners? (ii) Whether the suit filed by Naeem is maintainable? (M 05) Examiner’s Comments (Autumn 04): Generally the question was poorly answered as the candidates did not mention the exceptions to the general rule in part (i). Candidates not having knowledge of the exceptions did not give correct reply to part (ii) of the question. Section 69(3)(a) of the Partnership Act 1932 lists an exception to the general rule that a partner of an unregistered firm can file a suit for the realization of the property of the dissolved firm. Some candidates mentioned the exceptions in part (i) but failed to apply them in part (ii).

20. Tricky Question Q.7 (c) A borrowed Rs. 50,000 from B by giving a promissory note in his individual capacity. He used the proceeds of the note in the partnership business. While A had gone abroad for medical reasons, B sued the partnership as the promissory note became overdue. With reference to both the Partnership Act, 1932, and Negotiable Instruments Act, 1881, explain whether the firm is liable to pay the amount. Would it make any difference if A had informed B that the borrowing was being made for the purpose of the firm? (06) Examiner Comments (Autumn 07): The students generally failed to highlight that (under section 22 of the Partnership Act 1932), a partner can bind the firm only when an act is done either in the firm’s name or with express or implied intention to bind the firm. They just gave the answer in yes or no without giving any reason and lost most of the marks. On the other hand, only few candidates could explain the liability of the firm under the Negotiable Instruments Act, 1932, according to which the firm will only become liable if the fact of the agency is mentioned on the instrument.

21. Tricky Question Q.8 (a) Ahmed draws a bill of exchange in favour of Bilal, a minor or to his order. Bilal endorsed the bill in favour of Dawood, an agent of Fareed, against appropriate consideration. Dawood endorsed the same in favour of Ghalib. Answer the following giving appropriate reasons: Can Ahmed refuse to pay the bill on the plea that it was issued in favour of Bilal who being a minor was not competent to contract? If Ahmed fails to pay the bill on presentation, can Ghalib claim the amount from Dawood? Can Ghalib claim the amount from Bilal if the amount received by Bilal as consideration for the bill is still available with Bilal? (06) Examiner Comments (Spring 08):The performance in the question was poor as students didn’t seem to have adequate knowledge and understanding of the Negotiable Instruments Act 1881. The common mistakes committed in various sub-parts were as follows: The students were generally of the opinion that being a minor, the endorsement of the Bill by Bilal was invalid. Very few could realize that although Bilal was not liable for payment yet, his endorsement in favour of Dawood was valid. Very few of the students knew that Dawood was personally liable for making payment against the bill unless he had specifically stated on the bill that he was endorsing the bill in his capacity as an agent of Fareed.

22. Tricky Question Q. 8 (c) A bill was drawn payable to ‘Ahmed or order’. It was lost subsequently. Basheer who found the bill forged Ahmed’s signature and endorsed it to Chawla who took it for value and in good faith. Is Chawla a ‘holder in due course’? Discuss. Would your answer be the same, if the bill was bearer? Discuss. (04) Examiner Comments (Spring 08):It was a poorly attempted question. Most candidates had no clues to the answer and resorted to guess work. The question was based on forged endorsement amounting to ab initio absence of a valid title. Most candidates confused the concept with that of an instrument obtained by fraud and having a defective title and consequently lost marks. Furthermore, even those few who concluded as above, were mostly unable to clarify that if it was a bearer instrument, the rights of holder in due course would not be affected.  

23. Tricky Question Q.10 The goods received by Haseeb Brothers were damaged owing to improper cooling system in the ship owned by Blue Ocean Shipping Company. State the rules relating to claim for loss of goods to be lodged by Haseeb Brothers with Blue Ocean Shipping Company, with reference to Carriage of Goods by Sea Act, 1925. (05) Examiner Comments (Autumn 08): As discussed previously, the students had not given due emphasis to the Carriage of Goods by Sea Act, 1925. Almost 20% didn’t attempt the question whereas many others wrote answers based on common sense and general understanding instead of mentioning the relevant rules contained in Article III of the Act. Many of them wrote lengthy paragraphs on cooling chambers, sea worthiness of the ship, change of route etc., which were not relevant.