1. (a) With the help of the decided cases, discuss various ways in which an agency may be created. (12 marks)

(b) Juma had sent 10 tons of mangoes from Meru through Meru Transporters Ltd to a buyer  in Nairobi. It was not possible for the mangoes to continue the journey further after about 

100 kms from Meru since a bridge had collapsed. Meru Transporters entrusted their driver to sell the mangoes in a nearby town. The driver sold the mangoes at a price lower than the marked price. Juma sued Meru transporters for selling mangoes. Advise Meru Transporters. (11 marks) 



  1. The mere act that one or more parties to a contract under a mistake does not, as a

general rule, affect the validity of the contract. A contract is only void on the ground of mistake when the mistake is such that there was never any real agreement between the parties. In light the light of this statement discuss different types of mistake and their effect on the validity of a contract. 



  1. (a) Whenever there is a breach of contract by one party, the other is entitled to bring an action for damages. If the innocent party has sustained loss, he is entitled to substantial  damages which are calculated in accordance with certain rules. Discuss those rules. 

(12 marks) 

(b) Kimani bought a boiler from Kuria for use in his factory. Delivery was to be made on 15th March but was not made until 20th October. Kimani claimed (1) loss of profit the factory would have made had the biler been delivered in time and (2) loss of profit from some highly profitable contracts. 

Advise Kuria on the legal position. (11 marks) 



  1. (a) Examine various rules in respect of an acceptance of offer. (12 marks)

(b) Abba & Co. accepted a tender submiited by Khamala for supply of stationary for two 

years as when required within two years & Co. never placed any order. Khamala sued Abba & Co. for breach of contract. 

Advise Abba & Co. 

Will your answer be different if Abba & Co. bought stationary from Kenstationer Ltd within the contract period? (11 marks) 



  1. (a) Discuss various classifications of law (8 marks)

(b) Discuss the following sources of law 

  • Common law and equity (8 marks)
  • African customary law (7 marks)



  1. Write explanatory note on any TWO of the following:
  • Capacity of a minor (12 marks)
  • Frustration of a contract (12 marks)
  • Invitation to treat (12 marks)
  • Consideration (12 marks)
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