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Questions on Indemnity and Guarantee

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Indemnity and Guarantee Question Bank

Question 1
Who is protected under the contract of guarantee ?

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A
guarantor
B
debtor
C
third person
D
creditor
Question 2
The guarantee of single transaction is ………..
A
general guarantee
B
implied guarantee
C
continuous guarantee
D
none of these
Question 3
In the contract of Indemnity ……….. to promise is essential.
A
profit
B
benefit
C
none of these
D
loss
Question 4
Liability of surety is ………..
A
secondary liability
B
co-related liability
C
subsidiary liability
D
preliminary liability
Question 5
Life insurance contract is an indemnity contract in India ?
A
Ambiguity
B
Limited
C
Yes
D
No
Question 6
The contract of guarantee is for protection of ………..
A
none of these
B
creditor
C
debtor
D
guarantor
Question 7
On whose default, the promise of discharge of liability is given in contract of guarantee ?

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A
All above
B
Principal debtor
C
Subsidiary debtor
D
Principal guarantor
Question 8
The liability of surety is exact nature of ………..
A
principal debtor
B
implied guarantor
C
subsidiary debtor
D
subsidiary guarantor
Question 9
In contract of indemnity must be ………..
A
agreement without consideration
B
implied consideration
C
lawful consideration and object
D
five parties
Question 10
How many parties are there in contract of guarantee ?
A
Three
B
One
C
Two
D
At will
Question 11
In contract of indemnity how many parties are required ?
A
7
B
4
C
2
D
6
Question 12
The person to whom the guarantee is given is called ………..
A
third party
B
surety
C
debtor
D
creditor
Question 13
The contract of Guarantee should be ………..

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A
only oral
B
written or oral
C
only written
D
Implied
Question 14
Which type of guarantee is given for series of transaction ?
A
general guarantee
B
general and continuous guarantee
C
continuous guarantee
D
implied guarantee
Question 15
In which type of contract promise is being protected ?

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A
Contract of guarantee
B
Contract of bailment
C
Contract of agency
D
Contract of indemnity
Question 16
When guarantor becomes free ?
A
None of these
B
By increase of liability
C
By getting benefit
D
Change in terms of contract
Question 17
Whose consent is necessary in the contract of guarantee ?
A
Creditor
B
Surety
C
Debtor
D
All as under
Question 18
The person in respect of whose default, the guarantee is given is called ………..
A
principal bailee
B
principal creditor
C
principal surety
D
principal debtor
Question 19
Liability for paying money ………..
A
secondary liability
B
subsidiary liability
C
preliminary liability
D
co-related liability
There are 19 questions to complete.

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