New 2023 L5M3 Dumps for CIPS Level 5 Advanced Diploma in Procurement and Supply Certified Exam Questions and Answer
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NEW QUESTION # 23
A failure to perform a provision of a contract which does not affect the end performance of the contract is known as what?
- A. small breach
- B. major breach
- C. warranty breach
- D. minor breach
Answer: D
Explanation:
This is a minor breach. This is the definition as given in the study guide on p. 48
NEW QUESTION # 24
Which of the following is not a form of ADR (Alternative Dispute Resolution)?
- A. negotiation
- B. conciliation
- C. mediation
- D. arbitration
Answer: A
Explanation:
Negotiation isn't an alternative dispute resolution because it's supposed to be the 'default' dispute resolution- the one you automatically do when a problem occurs. Only if negotiation fails should you turn to ADR. P. 142
NEW QUESTION # 25
Sarah is a baker and orders free-range eggs from a local supplier which she uses to make cakes. There is a contract in place which included a specification that states that the eggs must be free-range. One day the supplier delivers eggs which Sarah uses in the cakes. Later she dis-covered that these were not free-range. Sarah believes that the supplier has broken the con-tract. Is this true?
- A. no - there has been a breach in a warranty
- B. Yes- this is a fundamental breach
- C. Yes- this is a breach of a condition
- D. no- the specification is not a contract document
Answer: A
Explanation:
"No- there has been a breach in warranty" is the correct answer. The key to answering this question lies in the fact that the specification in this example is a warranty rather than a condition of the contract. P.45 of the study guide explains that the Sale of Goods Act has implications on whether or not a specification is a condition, warranty or innominate term and it's all about whether the product is in 'good condition' and can be used for its intended purpose. In this example the eggs were used for their intended purpose and were in good condition (or Sarah wouldn't have put them in the cakes). Therefore in this example, the eggs needing to be free-range is a warranty of the contract not a condition. Therefore options A and B are both wrong. Answer C is also wrong because the question mentioned that the specification was included in the contract. If you want to know more about the implication of the Sale of Goods act on specifications see p.45.
NEW QUESTION # 26
Dianne has a loan agreement which contains a clause for default. What does a clause for default imply?
- A. this allows the lender to declare insolvency
- B. this allows the lender to demand overdue payments are made straight away
- C. this allows a lender to demand payment from a guarantor if the borrower is unable to pay
- D. this allows the lender to demand full payment of the outstanding balance
Answer: D
Explanation:
A Clause for Default 'allows the lender to demand full payment of the outstanding balance'. See p.102. And always read the small print before you sign a loan agreement :)
NEW QUESTION # 27
Which of the following will you put into box 1?
- A. reputational damage
- B. penalty clause
- C. subcontracting
- D. consequential loss
Answer: D
Explanation:
The correct answers are as follows:
This is consequential loss. Brian Air is going to lose the profits from the sales of the flights it had sold. Now those flights won't go ahead Brian Air can claim for consequential loss which would help balance the books.
NEW QUESTION # 28
A large financial organisation ensures that they have contracts with all of their suppliers. In which instance would indemnity not necessarily form part of the contract?
- A. A Deed of Appointment of a Consultant
- B. A confidentiality agreement
- C. In assignment of intellectual property rights
- D. A software licence agreement
Answer: B
Explanation:
Indemnity isn't usually used for confidentiality agreements - this is stated on p.21 of the study guide. This is because it's hard to indemnify against- you don't know what the consequence of a breach of confidentiality is going to be so it's hard to quantify. Unliquidated damages is more suitable. The study guide does state that indemnity is frequently used in intellectual property rights, software licence agreements and share purchase agreements. This is also written on p. 21.
NEW QUESTION # 29
Which of the following are a suitable course of action to take in the event of a minor breach of a contract? Select TWO
- A. liquidated damages
- B. collaboration
- C. adjudication
- D. progress meetings
- E. litigation
Answer: B,D
Explanation:
In the event of a minor breach, CIPS says it is best to work with the defaulting party by conducting progress meetings and collaboration. This is on p. 50 of the study guide
NEW QUESTION # 30
Which of the following will you put into box 3?
- A. Subcontracting
- B. Specification
- C. Payment Term
- D. Time is of the Essence
Answer: B
Explanation:
The correct answers are as follows:
Specifying the food needs to be organic is a 'specification'
NEW QUESTION # 31
Which of the following will you put into box 7?
- A. Mediation
- B. Arbitration
- C. Negotiation
- D. Litigation
Answer: B
Explanation:
The correct answers are as follows:
Arbitration - this is a binding resolution made by a third party. This answer could be litigation, but that option has been taken by box 6 and you can only use the answers once. Mediation would not be a binding resolution and negotiation doesn't involve a third party.
NEW QUESTION # 32
A failure to perform a provision of a contract which does not affect the end performance of the contract is known as what?
- A. small breach
- B. major breach
- C. warranty breach
- D. minor breach
Answer: D
Explanation:
This is a minor breach. This is the definition as given in the study guide on p. 48
NEW QUESTION # 33
Which of the following will you put into box 5?
- A. mediation
- B. arbitration
- C. adjudication
- D. litigation
Answer: C
Explanation:
The correct answers are as follows:
This is adjudication. Adjudication is the only option which has a specified timeframe.
NEW QUESTION # 34
Perry is seeking a resolution to a conflict he has with his supplier. He wants a third party to make a binding and legally enforceable decision and wants the issue to remain confidential. He is considering litigation. Is this the best solution for Perry?
- A. no - Perry should try Conciliation
- B. no- Perry should try mediation
- C. yes- litigation is the most appropriate for his requirements
- D. no- Perry should try Adjudication
Answer: D
Explanation:
Perry should try adjudication. Litigation is public so there would be no confidentiality. Out of the four options only adjudication would provide Perry with what he needs; a binding decision which is confidential. See p.146 for more information on litigation.
NEW QUESTION # 35
Which of the following conflict resolution styles involves a strict timeline and is commonly used within the construction industry?
- A. conciliation
- B. arbitration
- C. adjudication
- D. litigation
Answer: C
Explanation:
Adjudication has strict timescales (this is one of the advantages of using this conflict resolution method). It has roots in the construction industry and has been widely used since the 1990s. See p.76 for more information
NEW QUESTION # 36
Which of the following will you put into box 8?
- A. Condition
- B. Innominate Term
- C. Warranty
Answer: B
Explanation:
The correct answers are as follows:
This is a condition. Again the food being organic would be fundamental to the contract as the health of the llamas depend on it.
This is arbitration as it involves a panel.
This is an innominate term as it won't be mentioned in the contract. It won't be until a breach occurs when it is decided whether the issue of subcontracting is a condition or a warranty, and which one it will be, will likely depend on the situation. For example if they subcontract out to a non-organic llama food provider, that would probably be a Condition. If they get help fulfilling an order and the subcontractor is also organic, that's probably a warranty.
NEW QUESTION # 37
David is selling his house and Barbera would like to buy it. David is expecting to get £100,000 for his house. Barbera offers £80,000 and David asks Barbera if she'll pay £90,000 instead. Barbera says no. After a week David hasn't had any other offers so would like to accept Bar-bera's offer. Can he do this?
- A. yes- Barbera's offer is still valid as it didn't come with a time clause attached
- B. no - David's counter offer rescinded Barbera's offer
- C. yes- Barbera's offer is the best he will receive
- D. no- he waited too long and Barbera's offer has expired
Answer: B
Explanation:
"No - David's counter offer rescinded Barbera's offer" is the correct answer. Remember: "once a counter offer is made, the original offer is viewed as rejected" - p.6 of the study guide. What this means is when David goes back to Barbera about the £80,000 - he is now the offeror - and Barbera has the option to reject this. David is no longer in a position to accept or reject - Barbera is.
NEW QUESTION # 38
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