Multiple choice

Directions: Given below is a statement of principle, followed by a factual situation. Apply the principle to the facts and select the most appropriate answer among three alternatives given. Encircle your choice and explain why you think your answer is correct in not more than 3 to 4 lines. If it exceeds 4 lines, then penalty may be imposed.

Principle 1: No consideration - No contract. Principle 2: Consideration is something done or abstinence of a party at the desire of another party. Principle 3: Consideration must have value in the eye of law. Fact: Innovative Education Trust manages a School named Bharat Vidyaniketan. Ashok, the parent of a student in the School suggested to the Trust that it could build a new library building for which he would bear a part of the cost. The School authority accepted the suggestion and started construction of the building. Ashok having suffered a loss in business, now refuses to pay the part he had offered earlier.

Which of the decision you think is appropriate?

  1. Ashok is not liable to pay as the building was for the benefit of the School and he has nothing to do with it by way of enjoying any benefit.

  2. He is liable to pay as Ashok's child is a student in the same School.

  3. Ashok is liable to pay because based upon his promise, the School authority started construction of the building.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

(3) because the promise to pay money and the decision to construct the library are reciprocal promises.

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