INTERPRETATION OF CONTRACTS

401. It is the determination of the meaning of the terms or words used by the parties in their
written contract.
a. Casual contract
b. Interpretation of contracts
c. Assignee contact
d. None of the above

402. It is the process of ascertaining the intention of the parties from the written words
contained in the contract.
a. Casual contract
b. Interpretation of contracts
c. Assignee contact
d. None of the above

403. If the words appear to be contrary to the evident intention of the parties, the latter shall
__________ the former.
a. Have no rights
b. Prevail over
c. Has the right
d. None of the above

404. What article speaks of act contemporaneous and subsequent to the celebration of the
contract, antecedent circumstances under which it was made may also the be considered.
a. Article 1373
b. Article 1156
c. Article 1371
d. Article 2000

405. If one interpretation makes a contact valid and the other makes it illegal, the former
interpretation is one which warranted by the rule stated in _______.
a. Article 1373
b. Article 1156
c. Article 1371
d. Article 2000

406. A ________ contract must be interpreted as a whole and the intention if the parties is to
be gathered from the entire instrument and not from particular words, phrase or clauses.
a. Agreement
b. Obligation
c. Contracts
d. None of the above

407. The taking back of an offer by the officer is

a. Revocation
b. Rejection
c. Cancellation
 d. Consideration

408. A contract that amounts to nothing and has no legal effect is

a. Bilateral
b. Voidable
c. Void
d. Unilateral

409. A contact that contains promise by both parties is

a. Express
b. Implied
c. Bilateral
d. Unilateral

410. If the terms of the contract are clear and leave no doubt upon the intention of the
contacting parties, the literal meaning of its stipulation shall not be in control.
a. True
b. False

411. If the words appear to be contrary to the evident intention of the parties the latter shall
prevail over the former
a. True
b. False
c.
412. In order to judge the intention of the contracting parties their contemporaneous and
subsequent acts shall be principally considered.
a. True
b. False

413. If a valid offer is met with a valid acceptance the result is.
a. Misinterpretation
b. Genuine agreement
c. Legality
d. Capacity

414. People sometimes enter into ____ contracts without saying a word.
a. Implied
b. Voidable
c. Express
d. Forceable

415. The offeree’s refusal or _____ of an offer ends that offer.

a. Revocation
b. Rejection
c. Cancellation
d. Consideration

416. An offer must be definite, communicated to the offeree and, ____

 a. Signed
b. Implied
c. Seriously intended
d. Timely

417. When the bilateral mistakes are made, neither party may avoid the contract
a. True
b. False

418. However general terms of a contact may be, they shall not be understood to
comprehend things that are distinct and cases that are different from those upon which the
parties intended to agree.
a. True
b. False

419. If some stipulation of any contract should admit of several meanings, it shall be
understood as bearing that important which is most adequate to render it effectual.
a. True
b. False

420. The various stipulations of a contact shall be interpreted together, attributing to the
doubtful ones that sense which, may result from all of them taken jointly.
A. True
B. False

421. A deliberate deception to secure unfair or lawful gain is

a. Misinterpretation’
b. Libel
c. Unilateral mistake
d. Fraud

422. Overcoming a person’s will through force is

a. Fraud
b. Duress
c. Extortion
d. Ratification

423. Words which may have different signification shall be understood in that which is most
in keeping with the nature and object of the agreement.
a. True
b. False

424. The usage or customs of the place shall be borne in mind in the interpretation of the
ambiguities of a contact and shall fill the omission of stipulation which ae ordinarily established.
a. True
b. false
425. the interpretation of obscure words or stipulation in a contact shall favor the party who
caused the obscurity.
a. True
b. False

426. Contact most of the terms of which do not result from mutual negotiation between the
parties as they usually prescribed in printed forms by one part to which the other may “adhere”
if he chooses but which he cannot change.
a. Interpretation of contracts
b. Contacts of adhesion
c. Gratuitous contract
d. None of the above

427. If the doubts refer to incidental circumstances of a gratuitous contract such

interpretation should be made which would result in the last transmission of rights and interest.
a. Interpretation of contracts
b. Contacts of adhesion
c. Gratuitous contract
d. None of the above

428. Alex persuade his grandmother, clara to sell him her cat for 1,000. They both knew the
cat was worth more than that. However, Clara did not need the cat anymore and loved her
grandson, so she agreed to sell him the cat. The next day clara found out that Alex was planning
to sell the cat for 2,000. Clara can avoid the contract because of:
a. Duress
b. Fraud
c. Undue influence
d. Mistake

429. A minor has the right to avoid a contract.

a. True
b. False

430. A legal means of enforcing a right correcting a wrong is a(n)

a. Breach
b. Remedy
c. Avoidance
d. Beneficiary

431. a minor who claims to be over the age of majority commits

a. fraud
b. misinterpretation
c. extortion
d. larceny

432. a minor would be held responsible for the fair value of which of the following?
a. Athletic shoes
b. CDs
 c. Medical care
d. Video games

433. After reaching the age of majority, a person may _________ a contract during minority
by using, selling or keeping the item, or by making payments.
a. Confirm
b. Disaffirm
c. Sign
d. Ratify

434. A promise to do something that is already under a legal obligation to do the same things
is not consideration.
a. True
b. False

435. Consideration in a contract means:

a. A person has the mental capacity to enter into contract
b. The two parties deal with the contract in a polite manner
c. The contract is legal and fully valid
d. Something of value is being exchanged by the two parties

436. For consideration to be present in a contract, the two parties must pay the market value
of the goods. For example, if one party is selling a car to another party, the car must be priced as
it would at a dealership.
a. True
b. False

437. A court’s award that reimburse a buyer for reasonable express when the seller has
breached a contract is ________ damages.
a. Incidental
b. Actual
c. Real
d. Illusory

438. If both parties to an illegal agreement are equally at fault, the court will aid both parties
equally.
a. True
b. False

439. When the contract is eventually end, they are said to be

a. Rejected
b. Avoided
c. Discharged
d. Unenforceable

440. Illegal agreements are

a. Voidable
b. Limited
 c. Enforceable
d. Void

441. Charging more than the maximum legal interest rate is:
a. Fraud
b. Usury
c. Extortion
d. Price-fixing

442. Competitors who sell a particular product or service at an agreed price are engaged in
a. Price fixing
b. Restraint
c. Usury
d. Restrictive covenant

443. A promise not to compete is

a. A restrictive covenant
b. Price fixing
c. Restraint
d. Usury

444. The destruction of the subject matter of a contract discharges that contra t.
a. True
b. False

445. Can a contract be ended by mutual agreement by the parties.?

a. Yes
b. No

446. As long as all long terms have been carried out properly and completely, the contract is
discharged by ____________.
a. Agreement
b. Avoidance
c. Performance
d. Exaction

447. Damages agreed upon by the parties when they first enter into a contract are called
a. Actual damages
b. Incidental damages
c. Anticipatory damages
d. Liquidated damages

448. What is a legal term used in contract, trust or other legal documents?
a. Planning law
b. Controlling law
c. Managing law
d. None of the above
 449. It refers to the laws of the state which will be relied upon in settling disputes, and is
often stated as one of the provision in an official agreement between two parties.
a. Planning law
b. Controlling law
c. Managing law
d. None of the above

450. Rules of construction governs the relationship between the ordinary and the legal
meanings of parties words and action or between the parties’ intent and their contractual
obligation.
a. True
b. False

451. ordinary meaning is the standard that the court uses for determining the language of
the contract.
a. True
b. False

452-455.
Choose the following that is not consider in interpreting a contact of a court.

452.
a. The drafting of the language
b. The plain meaning of the language
c. All of the above
d. None of the above

453.
a. other relevant terms that might not help determine the meaning of the language
b. The purpose of the clause
c. All of the above
d. None of the above

454.
a. the purpose of the contract as a whole
b. the facts and circumstances around the parties at the time of contract formation
c. all of the above
d. none of the above

455.
a. commercial common sense
b. court may allow the parties to introduce extrinsic evidence but may not
c. all of the above
d. none of the above

456. A court must interpret the contract in a way that reflects and promotes the intention of the parties
at the time they entered into the contract.
a. as expressed in the document
 b. intention of the parties
c. contra proferentem
d. parol evidence rule

457. Prevents extrinsic evidences from being considered unless the language of the contract is
ambiguous.
a. as expressed in the document
b. intention of the parties
c. contra proferentem
d. parol evidence rule

458. A court should give effect to the intentions of the parties as expressed in the written document, if
there is one.
a. as expressed in the document
b. intention of the parties
c. contra proferentem
d. parol evidence rule

459. the presence of ambiguity will also allow a court to apply __________.
a. as expressed in the document
b. intention of the parties
c. contra proferentem
d. parol evidence rule

460. if s court determines that there are conflicting terms in the contract, it should attempt to
harmonize the conflicting terms in order to give effect to the contract as a whole.
a. specific over general
b. conflicting terms
c. absence of words
d. surrounding circumstances

461.It is the relevant background of contract formation may be examined by a court.

a. specific over general
b. conflicting terms
c. absence of words
d. surrounding circumstances

462. The absence of the particular words in the contract should be considered in contract interpretation.
a. specific over general
b. conflicting terms
c. absence of words
d. surrounding circumstances

463. If a court tries to allow both conflicting terms by harmonizing them, the court will have specific
terms quality general terms.
a. specific over general
b. conflicting terms
c. absence of words
 d. surrounding circumstances

464. If the contract in question is onerous, then the doubts should be settled in favor of the greatest
reciprocity of interest.
a. onerous contract
b. principal object of the contact

465. If the doubt refers to the principal object of the contract and such doubt cannot be resolved
thereby leaving the intention of the parties’ unknown, the contract shall be null and void.
a. onerous contract
b. principal object of the contact

466. The principles of interpretation stated in Rule 123 of the Rules of Court shall likewise be observed
in the construction of contracts.
a. True
b. False

467. the plain meaning of the language.

a. true
b. false

468. the drafting of the language

a. true
b. false

469. other relevant terms that might help determine the meaning of the language
a. true
b. false

470. the purpose of the clause

a. true
b false

471. An interpretation involves a question of law since there is a force of law between the contracting
parties.
a. true
b. false

472. Contract interpretation is needed if there is a dispute over the terms, words, or definitions in a
contract. If the parties cannot agree on what a certain contract term means, they may need to file a
lawsuit in order to have the contract reviewed by the court.
a. true
b. false

473. Controlling law is a legal term used in contracts, trusts, or other legal documents.
a. true
b. false
474. A contract is ambiguous when it is uncertain what the intent of the parties was and the contract is
capable of more than one reasonable interpretation.
a. true
b. false

475. There are many rules and regulations governing contract interpretation. Courts should always
interpret contract terms with the goal of identifying the intention of the parties. Determining the intent
of the parties should be an objective analysis. The court should not consider subject
a. true
b. false

476. Silent agreements are either agreements that have been reached out of the public eye and are
subsequently put forth as compromises from both parties or, more commonly, a lack of protestation
from the opposite party that implies that they agree with the proposed position.
a. true
b. false

477. contracts may be classified into three namely, Express Contract, Implied Contract, and. Quasi –
Contract.
a. true
b. false

478. Ordinary meaning is the standard that the court uses for determining the language of the contract.
This is also known as the dictionary definition or common use.
a. true
b. false

479. contract is shown to be using specific technical language, it will be interpreted using ordinary
meaning.
a. true
b. false

480. Words Prevail Over Conflicting Numbers in Contract

a. true
b. false

481. If a contract is a legal obligation, 'illegal contract' is a contradiction in terms.

a. true
b. false

482. The contra proferentem rule is a legal doctrine in contract law which states that any clause
considered to be ambiguous should be interpreted against the interests of the party that created,
introduced, or requested that a clause be included.
a. true
b. false

483. Silence means yes when the other person has confirmed that it means yes.
a. true
 b. false

484. An implied-in-fact contract is a form of an implied contract formed by non-verbal conduct, rather
than by explicit words.
a. true
b. false

485. An unenforceable contract is a written or oral agreement that will not be enforced by courts.
a. true
b. false

486. Legally binding” means that the parties must obey the terms written in the contract and perform
their contract duties as stated.
a. true
b. false

487. A null and void contract is a formal agreement that is illegitimate and, thus, unenforceable from the
moment it was created.
a. true
b. false

488. when attorneys draft contracts they don't just write the numerals like regular people. Instead,
attorneys typically write out numbers in words as well as add the numerals in parentheses.
a. true
b. false

489. A simple rule for using numbers in writing is that small numbers ranging from one to ten (or one to
nine, depending on the style guide) should generally be spelled out.
a. true
b. false

490. A contract of adhesion refers to a contract drafted by one party in a position of power, leaving the
weaker party to “take it or leave it.”
a. true
b. false

491. Adhesion contracts are generally created by businesses providing goods or services in which the
customer must either sign the boilerplate contract or seek services elsewhere.
a. true
b. false

492. Ambiguity in contract law can result in a void or voidable contract, depending on the type of
ambiguous language identified in the agreement.
a. true
b. false

493. Once a contract is deemed illegal and void, the court will refuse to enforce the contract and leave
the parties as it finds them.
 a. true
b. false

494. It held that there was no blanket rule that the contract termination requirements must always
override the common law right to terminate.
a. true
b. false

495. Witness testimony describing what they thought the contract meant
a. true
b. false

496. Emails or correspondence discussing contract terms

a. true
b. false

497. how the parties acted if under a different contract together containing similar terms
a. true
b. false

498. commercial common sense a court may allow the parties to introduce extrinsic evidence, but may
not
a. true
b. false

499. the facts and circumstances around the parties at the time of contract formation
a. true
b. false

500. the purpose of the contract as a whole

a. true
b. false