Which of the following is NOT a reason as a matter of good governance for having a contract in writing?

• It is evidence of the intention of the parties.

• It allows a signing ceremony to be conducted.

• It is a point of reference for parties as to what has been agreed.

• It serves as record of the transactions entered by a party.

ABC Petroleum has issued an invitation to bid to 12 bidders worldwide. The invitation to bid constitutes a/an ___________ to the 12 bidders.

• Invitation to treat

• Offer

• Acceptance of offer

• Consideration

A requires 200,000 bbls of low sulphur fuel oil. B is only able to supply 100,000 bbls, to be delivered in 3 shipments. A valid contract can be created if A accepts B’s terms of supply and delivery.

• True

• False

A valid contract can have 10 parties. It is also possible to further add more parties to the contract during the contract period with the agreement of all the original parties.

• True

• False

Information which must be set out in a commercial contract include:

• Name and address of the parties.

• Quantity of cargo and tolerance.

• Price and payment terms.

• All of the above

Which of the following is NOT a delivery term under INCOTERMS 2010?

• FOB

• CIF

• DAE

• DDT

An indemnity should be sought:

• To cover costs of legal proceedings in the event of default by the counter-party.

• To cover the costs of damage to cargo which may be caused by the counter-party.

• To cover the amount of claims made by a third party as a result of default by the counter-party.

• All of the above.

What does NOT generally constitute a legal right for the termination of a contract:

• Breach of terms and conditions by a party.

• Force Majeure lasting beyond agreed period.

• Buyer is able to procure goods at a lower price from another seller.

• Winding up proceedings being instituted against a party.

Upon the termination of a contract, which of the following should still be performed by the parties:

• Delivery of the monthly quantity of cargoes committed under the contract.

• Payment for cargoes delivered during contract period.

• Delivery of the yearly quantity of cargoes committed under the contract.

• Acceptance of cargoes delivered after the contract period.

A shipment of cargo was lost at sea as a result of tsunami caused by a major earthquake off the coast of Country A. What should generally be the treatment of the loss under a sale and purchase contract?

• Breach of contract by seller.

• Breach of contract by buyer.

• Event of Force Majeure.

• Default of the government of country A for failing to provide warning of impending earthquake.