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Bmgt 313: Business Law Question Paper
Bmgt 313: Business Law
Course:Bachelor Of Commerce
Institution: Kabarak University question papers
Exam Year:2008
INSTRUCTIONS:
Answer question ONE and ANY other THREE questions
Marks may be lost for illegibility
1. a) A husband who was a civil servant in Nairobi went to London with his wife for a
vacation. When his leave was nearing its end and had to return home, he promised
his wife, a household allowance of Kshs. 40,000/= a ,month till she joined him in
Nairobi. Later the parties separated and the husband withheld the allowance. The
wife sued the husband to recover the withheld allowance. Can she succeed?
(5 marks)
b) A owns two houses,, one in Kakamega and another in Nairobi. A intends to sell his
house in Kakamega for Kshs. 1,500,000/=. B thinks he is buying the house in
Nairobi and forwards a bankers’ cheques for Kshs. 1,500,000/= to A. Is there a
contract between A and B? (5 marks)
c) A horse was sent by railway from Nairobi to Kisumu. However, the owner was not
present to collect it on time. The station master at Kisumu arranged for its feeding
and stabling incurring an expense of Kshs. 10,000/=. The station master filed a suit
to recover the money and the owner of the horse refused to pay. Decide.
(5 marks)
d) B told Kamau, a car dealer that he wanted a car that would be comfortable for touring
purposes. Kamau recommended to be a “Bugatti” Car. B relied on Kamau’s expert
advise and bought a “Bugatti” car. When it was delivered, it was found that it was
neither comfortable nor suitable for touring purposes. B. sued Kamau for the return
of the purchase money. Can he succeed? (5 marks)
e) Kamau, Wasike and Mose entered into a Partnership to execute contracts works.
Kamau secured a Partnership work estimated to cost 10 million shillings. He
obtained the said contract upon payment of Kshs. 500,000/= to a person in authority
and debted the sum in the account books of the Partnership as an item of expense.
Wasike and Mose objected to the item. How would you decide the dispute?
(5 marks)
f) George pays Kshs. 50,000/= to Abel a civil servant employed in the Government
department, in consideration of A’s promise that a Government contract which is at
the disposal of his department will be placed with George. Before this can be done,
Abel is transferred to another department. George wishes to reclaim from Abel Kshs.
50,000/= paid to him. Will he succeed? (5 marks).
2. a) Discuss essentials of a Promissory Note. (5 3
1 marks)
b) Explain the rights of an agent. (8 marks)
3. a) What is a tort? (4 3
1 marks)
b) With specific illustrations explain the defences available to a defendant in an action
arising out of a tort. (9 marks)
4 a) Explain the essential elements of a partnership (5 marks)
b) Discuss the duties of a partner towards other partners. (8 3
1 marks)
5. a) Explain the functions of law (5 marks)
b) Explain the following maxims of Equity.
i) He who seeks equity must do equity (3 marks)
ii) Where there is equity, the law must prevail (3 marks)
iii) Equity regards substance rather than form. (2 3
1 marks)
6. a) Discuss the Principal advantages of Arbitration as a process of settling Commercial
Disputes. (5 marks)
b) Discuss the conditions and Warranties implied in a contract of Sale of goods.
(8 3
1 marks)
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