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Questions and Answers
Why can F not annul the contract on the grounds of E's incapacity?
Why can G annul the contract with H on the ground of fraud?
In the context of the text, which situation would NOT constitute a ground for annulling a contract?
Why is E, being a farmer, relevant in the context of selling his carabao to F?
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What is the nature of an option contract?
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When can an offerer withdraw an offer in an option contract?
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What distinguishes a gratuitous option contract from an onerous one?
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Why is withdrawal of a gratuitous offer not considered a breach of contract?
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What is the main reason why G can annul the contract in the given scenario?
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Why can I, as a collector of rare coins, not annul the contract on the ground of mistake?
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Why can A and B not claim mistake as a basis for invalidating their contract of sale?
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In what circumstance can a contract be annulled due to mistake?
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Study Notes
Contract Annulment
- F cannot annul the contract on the grounds of E's incapacity because E's capacity is not relevant to the contract, as E is a farmer selling his carabao (a type of water buffalo) to F.
- G can annul the contract with H on the grounds of fraud because fraud is a valid reason for annulling a contract.
Invalid Reasons for Annulment
- A situation that would NOT constitute a ground for annulling a contract is a mistake made by a collector of rare coins (I) regarding the contract.
Option Contracts
- The nature of an option contract is that it gives the optionee the right to choose whether to enter into a contract or not.
- An offerer can withdraw an offer in an option contract before it is accepted.
- A gratuitous option contract is distinguished from an onerous one in that the former involves no consideration or payment, whereas the latter does.
- Withdrawal of a gratuitous offer is not considered a breach of contract because it is a unilateral offer that can be revoked at any time.
Grounds for Annulment
- The main reason why G can annul the contract in the given scenario is the presence of fraud.
- A and B cannot claim mistake as a basis for invalidating their contract of sale because they have a valid contract.
- A contract can be annulled due to mistake if the mistake is related to the essential qualities of the thing being sold or if the mistake is mutual.
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Description
Test your knowledge of contract law with this quiz on offer, acceptance, and withdrawal. Explore the legal implications of communication methods and deadlines in forming a contract.