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Buss 212:Business Law I 2Nd Trimester 2014 Question Paper
Buss 212:Business Law I 2Nd Trimester 2014
Course:Bachelor Of Business Information Technology
Institution: Kenya Methodist University question papers
Exam Year:2014
BUSINESS LAW 1 (BUSS 212) 2ND TRIMESTER 2014
KENYA METHODIST UNIVERSITY
END OF 2'ND 'TRIMESTER 2014 (FT) EXAMINATION
SCHOOL : BUSINESS AND ECONOMICS
DEPARTMENT : BUSINESS ADMINISTRATION
UNIT CODE : BUSS 212
UNIT TITLE : BUSINESS LAW 1
TIME: 2 HOURS
INSTRUCTIONS
Answer question one and any other two questions
Question One
Law is broadly defined as a set or a body of enforceable rules and principles intended to regulate and guide human conduct. Explain with appropriate illustrations five key functions of law
Otieno appointed Ahmed to transport fresh fish from Kisumu to Nairobi. As Ahmed was preparing to leave Kisumu for Nairobi he was arrested and detained by the police on allegations of being in the country illegally and engaging in terrorist activities. Fearing that the fish would go bad Ahmed tried to call Otieno to organize for alternative means of transport but failed. He them instructed his friend Mwangi to sell the fish at the best possible price he could get and bank the money in Ahmed’s bank account so that he could have it transferred to Otieno’s account later. Mwangi sold the fish at Ksh.1,500,000 and banked ksh.500,000 only in Ahmed’s account. He then visited Ahmed in police cells and told him that he had managed to sell the fish at Ksh.500,000 and had banked the same as instructed and as such he needed to be paid Ksh.50,000 for the services rendered. Ahmed was very happy with the report and he immediately gave Mwangi a cheque of Ksh.50,000 for the services rendered. Ahmed was released two weeks later and immediately upon his release he was able to contact Otieno who symphathized with him and accepted to be paid Ksh.350,000 for the fish. Otieno has now discovered that the fish was actually bought by his business rival at ksh.1,500,000 who processed it and sold it at Ksh.3,000,000. With this in mind answer the following questions
How many types of agency relationship are you able to identify in this case and how are they formed?
(10 Marks)
List and explain five duties of an agent
(5 Marks)
Otieno needs you advice on the way forward
(5 Marks)
Ahmed has since discovered that his arrest and detention was engineered by Mwangi who had made a false report to the police about him. Advice Ahmed
(5 marks)
Under which law would place the allegations made by the police against Ahmed and how are they different from those made by Otieno against Ahmed following your advice?
(5 Marks)
Question Two
It is always necessary to communicate acceptance to communicated acceptance of an offer to the other party to the contract. Explain why communication is important noting to capture all the aspects of a valid acceptance
(5 marks)
With appropriate examples distinguish between innocent misrepresentation and fraudulent misrepresentation in the law of contract
(5 marks)
Kamau entered into a hire purchase transaction with Hard Time Hirers Ltd for a car whose cash price is Ksh.600,000 and hire purchase price is ksh.400,000 and agreed to pay the balance by equal monthly installments of Ksh.41,666 until payment in full. Kamau has paid the agreed installments for the 8 months but he has since defaulted and Hard Time Hirers Ltd has promptly repossessed the car. Explain the legal principles in this situation and advice Kamau
(10 marks)
Question Three
In relation to the law and insurance list and explain five important principles of insurance. You must use appropriate examples to illustrate your answer
(10 marks)
Using appropriate examples explain how negotiable instruments facilitate business transactions
(10 marks)
Question Four
What is arbitration and how does it facilitate business transactions?
(8 marks)
The law of sale of goods provides that where goods are sold by a person who is not the owner thereof and who does not sell them with the consent or authority of the owner, the buyer acquires no better title to the goods than the seller had
What do you call this principle of law?
(2 marks)
Identify and explain five exceptions to this principle. Appropriate examples must be used to support your answer
(10 marks)
Question Five
Write brief notes on the following using appropriate examples to illustrate your answer
Delegated legislation
(4 marks
Morality
(4 marks)
Caveat emptor
(4 marks)
Privity of contract
(4 marks)
Contractual liability
(4 Marks)
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