Free Practice Questions for CIPS L5M3 Exam

Explanation

The correct answers are as follows:

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This is mediation because 1) it's private and 2) there's a third party present

Explanation

The correct answers are as follows:

The answer is compromise as they're seeking a solution that will satisy everyone.

Explanation

No - There is no consideration. For a document to be considered a contract there must be consideration. This means something of value must be exchanged. In this example John gives Larry something but Larry doesn't give John anything. Therefore there is no consideration and this is not a contract. See p.12

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The correct answers are as follows:

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It's reputational damage as the scenario mentions 'bad press'

Explanation

They can claim damages but not terminate the contract. If Blue company has broken a Condition, they would be able to terminate the contract, but this isn't the case for a breach of a Warranty. See p.43 for more details

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The correct answers are as follows:

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This is litigation as it involves a legal team and it's public. Out of the 4 options only litigation is a public dispute resolution.

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The correct answers are as follows:

This is arbitration as it involves a panel.

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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 :)

Explanation

If you're not happy with the decision of an adjudication you can appeal the decision. So option 2 is correct. If the appeal is turned down then unfortunately there's not much more you can do as adjudication is binding and legally enforceable. See p. 143 for more info on adjudication

Explanation

The correct answers are 1 and 3. The other options are false; Mediation does not produce legal precedents- only litigation can do this. Mediation is a cheap dispute resolution option (much cheaper than arbitration or litigation) and the third party has no authority on the matter- they are there as a facilitator of dialogue, not to make a judgement. For more information on mediation see p.74