CAIB 3 Practice Exam Questions and Correct Answers
What is the name given to the collection of written decisions? - Answer-Case Law
Explain the concept of the Rule of Precedent. - Answer-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". - Answer-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. - Answer-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. - Answer-
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. -
Answer-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? - Answer-The defendant has the right to establish a defense against an action
alleging strict liability.
What determines if a product is defective? - Answer-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. - Answer-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. - Answer-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 - Answer-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
What is the name given to the collection of written decisions? - Answer-Case Law
Explain the concept of the Rule of Precedent. - Answer-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". - Answer-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. - Answer-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. - Answer-
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. -
Answer-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? - Answer-The defendant has the right to establish a defense against an action
alleging strict liability.
What determines if a product is defective? - Answer-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. - Answer-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. - Answer-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 - Answer-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
