1. GEN 2B Sample Questions

2. Sample Multi-Choice Questions

3. Sample Question  The Golden rule, when used to interpret an Act of the Oireachtas states: states: A that words should be construed in their ordinary sense B that where words literally interpreted would produce an absurd result, a different interpretation that avoids this may be used result, a different interpretation that avoids this may be used C that the purpose of the Act should be determined by considering the abuse it was intended to remedy the abuse it was intended to remedy D that general terms occurring after a list will be interpreted as being of the same kind as the listed items being of the same kind as the listed items

4. Answer  The Golden rule, when used to interpret an Act of the Oireachtas states: states: A that words should be construed in their ordinary sense B that where words literally interpreted would produce an absurd result, a different interpretation that avoids this may be used result, a different interpretation that avoids this may be used C that the purpose of the Act should be determined by considering the abuse it was intended to remedy the abuse it was intended to remedy D that general terms occurring after a list will be interpreted as being of the same kind as the listed items being of the same kind as the listed items Answer: B

5. Sample Question  Which of the following are features of a partnership that distinguish it from a limited company? distinguish it from a limited company? A A partnership has no corporate existence; details of finances are confidential; there is no legal limitation on the maximum number confidential; there is no legal limitation on the maximum number of partners of partners B A partnership has a separate legal status from the individual partners; details of finances are confidential; there is a legal partners; details of finances are confidential; there is a legal limitation on the maximum number of partners limitation on the maximum number of partners C Partners generally have unlimited liability; details of finances are confidential; there is a legal limitation on the maximum number of confidential; there is a legal limitation on the maximum number of partners partners D All partners must agree to the appointment of a new partner; details of finances are publicly available; there is no legal details of finances are publicly available; there is no legal limitation on the maximum number of partners limitation on the maximum number of partners

6. Answer  Which of the following are features of a partnership that distinguish it from a limited company? distinguish it from a limited company? A A partnership has no corporate existence; details of finances are confidential; there is no legal limitation on the maximum number confidential; there is no legal limitation on the maximum number of partners of partners B A partnership has a separate legal status from the individual partners; details of finances are confidential; there is a legal partners; details of finances are confidential; there is a legal limitation on the maximum number of partners limitation on the maximum number of partners C Partners generally have unlimited liability; details of finances are confidential; there is a legal limitation on the maximum number of confidential; there is a legal limitation on the maximum number of partners partners D All partners must agree to the appointment of a new partner; details of finances are publicly available; there is no legal details of finances are publicly available; there is no legal limitation on the maximum number of partners limitation on the maximum number of partners Answer: C

7.  In determining whether damages are recoverable for nervous shock, which of the following statements is true regarding the tests given in the judgement in Kelly v Hennessey [1995] ? AIf harm results from perception of the aftermath of injury the plaintiff must have a close personal relationship with the victim BThe plaintiff must have suffered illness consequent upon the event, though the type of illness is not specified CThe test of reasonable foreseeability applies to personal injury but not to nervous shock DIf there is no connection between a witness to a serious accident and the victim, there can be no successful cause of action Sample Question

8.  In determining whether damages are recoverable for nervous shock, which of the following statements is true regarding the tests given in the judgement in Kelly v Hennessey [1995] ? AIf harm results from perception of the aftermath of injury the plaintiff must have a close personal relationship with the victim BThe plaintiff must have suffered illness consequent upon the event, though the type of illness is not specified CThe test of reasonable foreseeability applies to personal injury but not to nervous shock DIf there is no connection between a witness to a serious accident and the victim, there can be no successful cause of action Answer: A Answer

9.  When determining whether interference is sufficiently unreasonable to amount to nuisance, which of the following statements is true? AIt is irrelevant how long the alleged nuisance has existed BNo action for nuisance can arise if an individual puts themselves in a situation where the nuisance already exists CMalice on the part of the alleged tortfeasor will not alter the fact of whether an activity is regarded as a nuisance DThe alleged nuisance must be continuous or repetitive and not a ‘one off’ Sample Question

10.  When determining whether interference is sufficiently unreasonable to amount to nuisance, which of the following statements is true? AIt is irrelevant how long the alleged nuisance has existed BNo action for nuisance can arise if an individual puts themselves in a situation where the nuisance already exists CMalice on the part of the alleged tortfeasor will not alter the fact of whether an activity is regarded as a nuisance DThe alleged nuisance must be continuous or repetitive and not a ‘one off’ Answer: D Answer

11.  In relation to the duration of an offer in the form of a quotation provided by an insurer to individuals, which of the following statements is true? AA time limit in a quotation for insurance has a greater significance than offers in law generally BRevocation of a quotation may be made at any time before acceptance even if a time limit is given in the quotation CA quotation made generally to the public to insure at specific rates ceases to be a general offer when one person accepts DA counter-offer by the individual will not act as a rejection of the original offer provided it occurs within the period of validity of the quotation Sample Question

12.  In relation to the duration of an offer in the form of a quotation provided by an insurer to individuals, which of the following statements is true? AA time limit in a quotation for insurance has a greater significance than offers in law generally BRevocation of a quotation may be made at any time before acceptance even if a time limit is given in the quotation CA quotation made generally to the public to insure at specific rates ceases to be a general offer when one person accepts DA counter-offer by the individual will not act as a rejection of the original offer provided it occurs within the period of validity of the quotation Answer: A Answer

13.  Which of the following statements is true regarding warranties in insurance contracts? AInsurers are entitled to treat a breach of warranty under any insurance policy as relieving them of all liability under that policy from the date of the breach BA warranty must be complied with in general terms rather than literally, since it does not go to the root of the contract CFor insurance policies with private individuals, there must be a causal connection between a breach of warranty and a loss if insurers wish to avoid a claim payment DWhen there is a breach of warranty, insurers may avoid the claim to which it relates but the policy remains in force Sample Question

14.  Which of the following statements is true regarding warranties in insurance contracts? AInsurers are entitled to treat a breach of warranty under any insurance policy as relieving them of all liability under that policy from the date of the breach BA warranty must be complied with in general terms rather than literally, since it does not go to the root of the contract CFor insurance policies with private individuals, there must be a causal connection between a breach of warranty and a loss if insurers wish to avoid a claim payment DWhen there is a breach of warranty, insurers may avoid the claim to which it relates but the policy remains in force Answer: C Answer

15.  In what way was the interpretation of a material fact re-defined in the case of Chariot Inns v Assicurazioni Generali (1981) ? AThe Judge added a ‘prudent insurer’ test to the definition BThe Judge added a requirement for an insurer to ask specific questions for facts in areas the insurer knows to be material CThe Judge added a test of what a ‘reasonable insured’ might see as material to the definition DThe Judge added a test of reasonableness of the insurer to the definition Sample Question

16.  In what way was the interpretation of a material fact re-defined in the case of Chariot Inns v Assicurazioni Generali (1981) ? AThe Judge added a ‘prudent insurer’ test to the definition BThe Judge added a requirement for an insurer to ask specific questions for facts in areas the insurer knows to be material CThe Judge added a test of what a ‘reasonable insured’ might see as material to the definition DThe Judge added a test of reasonableness of the insurer to the definition Answer: D Answer

17.  Which of the following is a correct statement regarding the insurable interest of joint owners of property? AThey must insure property jointly if they wish to insure for the full value BThey may each insure for their respective financial interests in the property but no more CThey may each insure for half the value DThey may each insure for the full value Sample Question

18.  Which of the following is a correct statement regarding the insurable interest of joint owners of property? AThey must insure property jointly if they wish to insure for the full value BThey may each insure for their respective financial interests in the property but no more CThey may each insure for half the value DThey may each insure for the full value Answer: D Answer

19.  Which of the following statements is correct regarding proximate cause where two operating perils are involved? AIf independent perils combine to cause a loss where each would have caused some damage on its own, the insurer has no liability for the loss BIf independent perils combine to cause a loss where each would have caused some damage on its own, the insurer has full liability for the loss CIf independent perils combine to cause a loss where neither would have caused damage on its own, if one is an insured peril and the other excluded, the insurer has no liability for the loss DIf independent perils combine to cause a loss where neither would have caused damage on its own, if one is an insured peril and the other unnamed in the policy, the insurer has no liability for the loss Sample Question

20.  Which of the following statements is correct regarding proximate cause where two operating perils are involved? AIf independent perils combine to cause a loss where each would have caused some damage on its own, the insurer has no liability for the loss BIf independent perils combine to cause a loss where each would have caused some damage on its own, the insurer has full liability for the loss CIf independent perils combine to cause a loss where neither would have caused damage on its own, if one is an insured peril and the other excluded, the insurer has no liability for the loss DIf independent perils combine to cause a loss where neither would have caused damage on its own, if one is an insured peril and the other unnamed in the policy, the insurer has no liability for the loss Answer: C Answer

21.  Which of the following statements is true regarding ‘agreed value’ policies? AThe agreed value is payable both for total losses and substantial partial losses BOnce stated the agreed value will apply to the forthcoming period and future periods if the policy is renewed CPartial losses must be based upon the agreed value unless a policy term states otherwise DDepreciation will be taken into account in any agreed value claims settlement Sample Question

22.  Which of the following statements is true regarding ‘agreed value’ policies? AThe agreed value is payable both for total losses and substantial partial losses BOnce stated the agreed value will apply to the forthcoming period and future periods if the policy is renewed CPartial losses must be based upon the agreed value unless a policy term states otherwise DDepreciation will be taken into account in any agreed value claims settlement Answer: C Answer

23. Sample Problem Question

24.  ABC factors limited purchased a building which had originally been constructed as a church and was therefore of substantial construction. They purchased it for a price of €190,000 (its current resale value) though its rebuilding cost was substantially more, estimated at €400,000. Its site value is €50,000. The cost of erecting a building of modern construction to provide the same functionality is estimated at €280,000. Sample Problem Question

25.  If ABC Factors were actively wishing to sell the building, but wished to insure it what would represent a fair basis for indemnity, based upon the decision in Leppard v Excess Insurance Co Ltd (1979) ? A€140,000 B€190,000 C€230,000 D€400,000 Problem Question A

26.  If ABC Factors were intending to use the building and not sell it (rebuilding in the event of damage), what would be a fair basis for indemnity, based upon the decision in Reynolds and Anderson v Phoenix Insurance Co Ltd (1978) ? A€140,000 B€230,000 C€280,000 D€400,000 Problem Question B

27.  If ABC Factors insure the building on an indemnity basis and subsequently a serious fire claim occurs, necessitating substantial rebuilding, which of the following statements is true regarding any improvement in value following repairs being carried out? ANo deduction for this increase in value will be made by insurers BThe only deduction that could be made is in respect of any excess that applies under ABC Factors’ policy CInsurers will deduct the full amount of the difference in value when settling the claim with ABC Factors DInsurers will only make a deduction if this can be negotiated with the ABC Factors Problem Question C

28.  What term is used to describe a building such as the one owned by ABC Factors, now used for a different purpose than that originally intended? AAdapted BObsolete CImproved DAged Problem Question D

29.  If, instead of insuring on an indemnity basis, ABC Factors were to insure the building under a policy subject to the reinstatement memorandum, what effect would this have on the following claims settlements if the sum insured they choose is €350,000? AA claim for €4,000 would be settled for €3,500 BA claim for €4,000 would be settled in full CA claim for €375,000 would be for €328,125 DA claim for €375,000 would be settled in full Problem Question E

30.  1A – Answer: A  1B – Answer: D  1C – Answer: C  1D – Answer: B  1E – Answer: B Answers to Problem Question