Contract Law (CLAT Legal-Aptitude): Questions 12 - 12 of 97

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Question number: 12

» Contract Law

MCQ▾

Question

PRINCIPLE: A contract by which one party promises to save the other from loss caused to him by the contract of the promisor himself, or by the conduct of any other person, is called a “contract of indemnity”. The promisee in a contract of indemnity, acting within the scope of his authority, is entitled to recover from the promisor all damages which he may be compelled to pay in any suit in respect of any matter to which the promise to indemnify applies. The promisor shall not be liable for damage not covered by the scope of the contract of indemnity.

FACTS: Ramu had hired a truck along with driver owned by Meflin & Co. for transporting huge amounts of grain from one storage to another storage. As per the terms of contract of indemnity, Meflin & Co. was to remain indemnified for all harm to the truck in the transport. In the way to the destination, the driver of the truck was found negligently driving the truck and was severely fined on the way by the policeman. Meflin & Co. seeks to recover this amount from Ramu. Will they be successful?

Choices

Choice (4) Response

a.

No, the contract of indemnity does not cover such damage.

b.

Yes. Since the matter involves hiring of services, Meflin & Co. deserves to get any such amount.

c.

Yes. The responsibility of ensuring that the driver drives properly rests on Ramu.

d.

Yes, the company could recover any amount no matter whether there was any contract of indemnity or not.

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