CAIB 3 PRACTICE EXAM 2025 UPDATE WITH
CORRECT QUESTIONS AND ACTUAL ANSWERS .
What is the name given to the collection of written decisions? -
ANSWERS-Case Law
Explain the concept of the Rule of Precedent. - ANSWERS-Current
court decisions must follow those made in cases having similar
circumstances, which allows the development of a logical body of
general principles against which specific cases to be compared.
Explain the meaning of the term "damages". - ANSWERS-
Compensation in money for the loss or damage suffered.
Compensatory damages for bodily injury are an amalgamation of
general and special damages, and based on a number of factors
which the courts take into account.
State four factors that influence the determination of
compensatory damages. - ANSWERS-1. extent of financial support
provided by the injured party to his or her family
2. social position
3. reputation
4. financial circumstances
5. ability of the plaintiff's legal representative
Explain the assumption that lies at the centre of the Doctrine of
Strict Liability. - ANSWERS-Based on the assumption that certain
activities are so hazardous that, in the event of injury or damage
arising out of them, the person conducting the activity shall be
presumed to be legal liable
,Identify two activities that impose strict liability on the person
conducting the activity. - ANSWERS-The setting off of explosives ,
the lighting of fires, the operation of aircraft, the keeping of a
dangerous thing on the premises, such as water in a dam or
cistern; gas; electricity; wild animals.
What is the position of the defendant in a legal action when the
law deems the defendant strictly liable? - ANSWERS-The defendant
has the right to establish a defense against an action alleging
strict liability.
What determines if a product is defective? - ANSWERS-A defective
product is one that contained something that it should not have; or
something that should have been there was omitted in its
manufacture.
The Sale of Goods Act sets out the contractual responsibilities of
sellers for their products. This Statute Law contains a number of
implied warranties that form part of every contract for the sale of
goods.
Identify one implied warranty which is of significance to sellers of
products. - ANSWERS-fitness of a business's product(s) for a
particular purpose
The Sale of Goods Act also addresses a buyer's responsibility to
exercise care as to the suitability and quality of the products
purchased.
State the exception to this general rule. - ANSWERS-When a buyer
makes known the particular purpose for which the goods are
required, and relies on the seller's skill or judgment, there is an
implied condition that the goods will be reasonably fit for such
, purpose. If they are not, the seller will be liable for damages
should injury or property damage result from their use.
Your client, the proprietor of pub, is insured under the Commercial
General Liability Policy. Indicate whether or not the policy would
respond in the following instances. State COVERED or NOT
COVERED
The insured entered a claim for the recovery of a $1,000 payment
made as a goodwill gesture to a customer, a well-known
entertainer, who injured himself during a fall from a bar stool -
ANSWERS-NOT COVERED - REFERENCE: Ch. 2, pg. 4
Your client, the proprietor of pub, is insured under the Commercial
General Liability Policy. Indicate whether or not the policy would
respond in the following instances. State COVERED or NOT
COVERED
The insured had to cancel the booking of the pub for a large
private event because a ruptured pipe had caused serious water
damage to the premises and the restoration would not be
completed in time. The insured was sued for breach of contract by
the band that was hired to perform at this event. - ANSWERS-NOT
COVERED - REFERENCE: Ch. 2, pg. 10
Your client, the proprietor of pub, is insured under the Commercial
General Liability Policy. Indicate whether or not the policy would
respond in the following instances. State COVERED or NOT
COVERED
The insured received a $3,000 bill for a dental procedure from a
customer who broke a tooth when she bit on a piece of bone in
the pizza she had consumed at the pub. The customer had
informed the server of the incident - ANSWERS-COVERED -
REFERENCE: Ch. 2, pg. 3, 5
CORRECT QUESTIONS AND ACTUAL ANSWERS .
What is the name given to the collection of written decisions? -
ANSWERS-Case Law
Explain the concept of the Rule of Precedent. - ANSWERS-Current
court decisions must follow those made in cases having similar
circumstances, which allows the development of a logical body of
general principles against which specific cases to be compared.
Explain the meaning of the term "damages". - ANSWERS-
Compensation in money for the loss or damage suffered.
Compensatory damages for bodily injury are an amalgamation of
general and special damages, and based on a number of factors
which the courts take into account.
State four factors that influence the determination of
compensatory damages. - ANSWERS-1. extent of financial support
provided by the injured party to his or her family
2. social position
3. reputation
4. financial circumstances
5. ability of the plaintiff's legal representative
Explain the assumption that lies at the centre of the Doctrine of
Strict Liability. - ANSWERS-Based on the assumption that certain
activities are so hazardous that, in the event of injury or damage
arising out of them, the person conducting the activity shall be
presumed to be legal liable
,Identify two activities that impose strict liability on the person
conducting the activity. - ANSWERS-The setting off of explosives ,
the lighting of fires, the operation of aircraft, the keeping of a
dangerous thing on the premises, such as water in a dam or
cistern; gas; electricity; wild animals.
What is the position of the defendant in a legal action when the
law deems the defendant strictly liable? - ANSWERS-The defendant
has the right to establish a defense against an action alleging
strict liability.
What determines if a product is defective? - ANSWERS-A defective
product is one that contained something that it should not have; or
something that should have been there was omitted in its
manufacture.
The Sale of Goods Act sets out the contractual responsibilities of
sellers for their products. This Statute Law contains a number of
implied warranties that form part of every contract for the sale of
goods.
Identify one implied warranty which is of significance to sellers of
products. - ANSWERS-fitness of a business's product(s) for a
particular purpose
The Sale of Goods Act also addresses a buyer's responsibility to
exercise care as to the suitability and quality of the products
purchased.
State the exception to this general rule. - ANSWERS-When a buyer
makes known the particular purpose for which the goods are
required, and relies on the seller's skill or judgment, there is an
implied condition that the goods will be reasonably fit for such
, purpose. If they are not, the seller will be liable for damages
should injury or property damage result from their use.
Your client, the proprietor of pub, is insured under the Commercial
General Liability Policy. Indicate whether or not the policy would
respond in the following instances. State COVERED or NOT
COVERED
The insured entered a claim for the recovery of a $1,000 payment
made as a goodwill gesture to a customer, a well-known
entertainer, who injured himself during a fall from a bar stool -
ANSWERS-NOT COVERED - REFERENCE: Ch. 2, pg. 4
Your client, the proprietor of pub, is insured under the Commercial
General Liability Policy. Indicate whether or not the policy would
respond in the following instances. State COVERED or NOT
COVERED
The insured had to cancel the booking of the pub for a large
private event because a ruptured pipe had caused serious water
damage to the premises and the restoration would not be
completed in time. The insured was sued for breach of contract by
the band that was hired to perform at this event. - ANSWERS-NOT
COVERED - REFERENCE: Ch. 2, pg. 10
Your client, the proprietor of pub, is insured under the Commercial
General Liability Policy. Indicate whether or not the policy would
respond in the following instances. State COVERED or NOT
COVERED
The insured received a $3,000 bill for a dental procedure from a
customer who broke a tooth when she bit on a piece of bone in
the pizza she had consumed at the pub. The customer had
informed the server of the incident - ANSWERS-COVERED -
REFERENCE: Ch. 2, pg. 3, 5
