Free SQE Mock Test 36 — 20 Questions + Full Answers
Solicitors Qualifying Examination · Trainee solicitors · SQE1 sits: Jan & Jul
Sections: FLK1 · Applaa proprietary paper — free to download and print
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Applaa SQE Mock Test 36
applaa-sqe-mock-36.pdf · 20 questions
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8 of 20 shownCorrect answers highlighted in green. Full explanations included.
A director of Vanguard Industries plc (a private company limited by shares) wants to allot new shares to a new investor (Nathan) to raise capital of £25,000. The company has only one class of ordinary shares. Under the Companies Act 2006, which of the following is correct regarding the director's authority to allot these shares?
- A.The director has automatic statutory authority to allot the shares without shareholder approval under Section 550, unless restricted by the articles.
- B.The director must always obtain authorization by ordinary resolution of the shareholders under Section 551.
- C.The director must obtain authorization by special resolution of the shareholders to allot any shares.
- D.The director requires the approval of the Board of Trade before alloting any class of shares.
- E.Authority is only required if the allotment would cause the company to exceed its authorised share capital as stated in the memorandum.
✓ Worked Explanation
Core Concept: Director's Authority to Allot Shares (Section 550 CA 2006) The Companies Act 2006 grants directors of private companies with a single class of shares a specific statutory power to allot shares of that class without requiring shareholder approval - unless the articles restrict this. Step-by-Step Resolution: 1. Identify Company Type: Vanguard Industries plc is a *private* company limited by shares with *one* class of ordinary shares. 2. Apply Section 550: Directors of such a company
James offered to sell a printing press to Daniel for £150,000. Daniel replied: 'I accept your offer, but I will pay £135,000.' James did not respond. Two days later, Daniel wrote to James saying: 'I accept your original offer of £150,000.' Is there a binding contract between James and Daniel?
- A.Yes, because the second letter constituted a valid acceptance of the original offer.
- B.Yes, because the original offer remained open and had not been revoked by the offeror.
- C.No, because the counter-offer of the lower price killed the original offer, meaning it could no longer be accepted.
- D.No, because a contract for sale of goods must be made in writing signed by both parties.
- E.Yes, because the offeror's silence on the counter-offer constituted acceptance of the lower price.
✓ Worked Explanation
Core Concept: Counter-Offer and the Death of the Original Offer A counter-offer is a rejection of the original offer combined with a new offer on different terms. Once a counter-offer is made, the original offer is extinguished - it cannot be revived or accepted later. Step-by-Step Resolution: 1. Original Offer: James offers the printing press for £150,000. 2. Counter-Offer: Daniel replies with £135,000 - this is a counter-offer, NOT an acceptance. Under Hyde v Wrench (1840), this kills the ori
The directors of Omega Holdings Ltd wish to allot new ordinary shares for cash. The company's articles do not exclude pre-emption rights. Which of the following resolutions of the shareholders is required to disapply the statutory pre-emption rights under the Companies Act 2006?
- A.An ordinary resolution with a simple majority (over 50%).
- B.A special resolution with a 75% majority of votes cast.
- C.A written resolution signed by 100% of the shareholders.
- D.An extraordinary resolution requiring a 90% majority.
- E.No resolution is required; the directors can disapply pre-emption rights by a board resolution.
✓ Worked Explanation
Core Concept: Disapplying Pre-Emption Rights (Sections 570/571 CA 2006) Pre-emption rights protect existing shareholders from dilution by giving them the right to purchase newly allotted shares in proportion to their holdings. To *disapply* these statutory rights requires a special resolution (75% majority). Step-by-Step Resolution: 1. Understand Pre-Emption Rights: Under Section 561 CA 2006, when directors allot equity securities for cash, existing shareholders have a right of first refusal (p
Yasmine offered to sell a office building to Isabella for £1,500. Isabella replied: 'I accept your offer, but I will pay £1,350.' Yasmine did not respond. Two days later, Isabella wrote to Yasmine saying: 'I accept your original offer of £1,500.' Is there a binding contract between Yasmine and Isabella?
- A.Yes, because the second letter constituted a valid acceptance of the original offer.
- B.Yes, because the original offer remained open and had not been revoked by the offeror.
- C.No, because the counter-offer of the lower price killed the original offer, meaning it could no longer be accepted.
- D.No, because a contract for sale of goods must be made in writing signed by both parties.
- E.Yes, because the offeror's silence on the counter-offer constituted acceptance of the lower price.
✓ Worked Explanation
Core Concept: Counter-Offer and the Death of the Original Offer A counter-offer is a rejection of the original offer combined with a new offer on different terms. Once a counter-offer is made, the original offer is extinguished - it cannot be revived or accepted later. Step-by-Step Resolution: 1. Original Offer: Yasmine offers the office building for £1,500. 2. Counter-Offer: Isabella replies with £1,350 - this is a counter-offer, NOT an acceptance. Under Hyde v Wrench (1840), this kills the or
A director of Meridian Group Ltd (a private company limited by shares) wants to allot new shares to a new investor (Victor) to raise capital of £95,000. The company has only one class of ordinary shares. Under the Companies Act 2006, which of the following is correct regarding the director's authority to allot these shares?
- A.The director has automatic statutory authority to allot the shares without shareholder approval under Section 550, unless restricted by the articles.
- B.The director must always obtain authorization by ordinary resolution of the shareholders under Section 551.
- C.The director must obtain authorization by special resolution of the shareholders to allot any shares.
- D.The director requires the approval of the Board of Trade before alloting any class of shares.
- E.Authority is only required if the allotment would cause the company to exceed its authorised share capital as stated in the memorandum.
✓ Worked Explanation
Core Concept: Director's Authority to Allot Shares (Section 550 CA 2006) The Companies Act 2006 grants directors of private companies with a single class of shares a specific statutory power to allot shares of that class without requiring shareholder approval - unless the articles restrict this. Step-by-Step Resolution: 1. Identify Company Type: Meridian Group Ltd is a *private* company limited by shares with *one* class of ordinary shares. 2. Apply Section 550: Directors of such a company have
A claimant was injured when a defendant (Lucas), who was engaged in delivering expired pharmaceuticals, caused an accident. The defendant admits they owed the claimant a duty of care and breached it, but argues that the claimant's own negligence contributed to the injury. Under the Law Reform (Contributory Negligence) Act 1945, what is the legal effect of contributory negligence?
- A.It acts as a complete defense, and the claimant receives no damages.
- B.It reduces the claimant's damages to the extent that is just and equitable, reflecting the claimant's share of responsibility.
- C.It has no effect on damages but requires the claimant to pay the defendant's legal costs.
- D.It shifts the burden of proof to the claimant to show that they took all reasonable precautions.
- E.It renders the claim null and void, requiring allocation to criminal arbitration.
✓ Worked Explanation
Core Concept: Contributory Negligence (Law Reform (Contributory Negligence) Act 1945) Contributory negligence is a partial defence - it does not defeat the claim entirely, but reduces the damages awarded to reflect the claimant's own responsibility for their injury. Step-by-Step Resolution: 1. Identify the Defence: Lucas admits negligence but argues the claimant also contributed to their own injury (e.g., not wearing a seatbelt, failing to follow safety instructions). 2. Legal Effect (LRCNA 194
Grace offered to sell a printing press to Wendy for £500. Wendy replied: 'I accept your offer, but I will pay £450.' Grace did not respond. Two days later, Wendy wrote to Grace saying: 'I accept your original offer of £500.' Is there a binding contract between Grace and Wendy?
- A.Yes, because the second letter constituted a valid acceptance of the original offer.
- B.Yes, because the original offer remained open and had not been revoked by the offeror.
- C.No, because the counter-offer of the lower price killed the original offer, meaning it could no longer be accepted.
- D.No, because a contract for sale of goods must be made in writing signed by both parties.
- E.Yes, because the offeror's silence on the counter-offer constituted acceptance of the lower price.
✓ Worked Explanation
Core Concept: Counter-Offer and the Death of the Original Offer A counter-offer is a rejection of the original offer combined with a new offer on different terms. Once a counter-offer is made, the original offer is extinguished - it cannot be revived or accepted later. Step-by-Step Resolution: 1. Original Offer: Grace offers the printing press for £500. 2. Counter-Offer: Wendy replies with £450 - this is a counter-offer, NOT an acceptance. Under Hyde v Wrench (1840), this kills the original off
A claimant (Victor) makes a valid CPR Part 36 settlement offer to the defendant (Katelyn) of £95,000. The defendant rejects the offer. The case goes to trial, and the claimant wins, obtaining judgment of £109,249. What is the primary costs consequence under Part 36?
- A.The claimant must pay the defendant's costs on the indemnity basis.
- B.The defendant must pay the claimant's costs on the indemnity basis, plus interest on those costs, from the expiry of the relevant offer period.
- C.The court will split the trial costs equally between both parties.
- D.All costs recovery is capped at the Small Claims Track limit.
- E.The defendant is immune to costs penalties because they defended the claim in good faith.
✓ Worked Explanation
Core Concept: CPR Part 36 Offers and Cost Consequences A Part 36 offer is a formal settlement mechanism under CPR. When a claimant's Part 36 offer is beaten at trial (i.e., judgment exceeds the offer), the defendant faces automatic cost penalties designed to encourage early settlement. Step-by-Step Resolution: 1. Victor's Offer: £95,000 - a valid Part 36 offer. 2. Katelyn's Decision: Rejected the offer and proceeded to trial. 3. Trial Outcome: Victor wins £109,249 - which *exceeds* the Part 36
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Paper Info
- Exam
- SQE
- Mock number
- 36 of 250
- Questions
- 20
- Format
- Multiple Choice (MCQ)
- Sections
- 1
- Audience
- Trainee solicitors
- Timing
- SQE1 sits: Jan & Jul
- Copyright
- Applaa Proprietary
Sections Covered
- FLK1
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