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100+ Free NCA Commercial Law Practice Questions
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2026 Statistics
Key Facts: NCA Commercial Law Exam
$500 CAD
Fee Per NCA Exam (plus taxes)
nca.legal Costs and Timelines (2025-2026)
3 hours
Maximum Exam Duration
National Committee on Accreditation
Open-book
Exam Format (fact-based, written)
National Committee on Accreditation
50%
Passing Grade (pass/fail)
National Committee on Accreditation
Ontario PPSA
Primary Secured-Transactions Statute on Syllabus
NCA Commercial Law Syllabus (November 2025)
100+
Practice Questions Here
OpenExamPrep question bank
The NCA Canadian Commercial Law exam is a substantive subject for internationally trained lawyers seeking to qualify in a Canadian common-law province. Administered by the National Committee on Accreditation under the Federation of Law Societies of Canada, it is open-book, fact-based, and up to three hours, with short-answer, essay, and problem questions graded pass/fail (50%). The November 2025 syllabus covers Ontario PPSA secured transactions (scope, attachment, perfection, priorities, PMSIs, ordinary-course buyers, default remedies, and the trustee in bankruptcy), the liquidated damages versus penalty distinction, and Sale of Goods Act rules on the nature of the contract and the passing of property. The exam fee is $500 CAD plus taxes. This free OpenExamPrep bank provides 100 multiple-choice knowledge-prep questions on that content; note the real exam uses written answers, not multiple choice.
Sample NCA Commercial Law Practice Questions
Try these sample questions to test your NCA Commercial Law exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.
1A supplier sells equipment to a buyer under a conditional sale agreement that reserves title until the price is paid in full. Under the Ontario Personal Property Security Act (PPSA), how is the seller's reserved title interest generally characterized?
A.As a security interest to which the PPSA applies, despite the reservation of title
B.As ownership remaining outside the PPSA until default
C.As a mere contractual condition that never creates a security interest
D.As a common-law lien that is excluded from the PPSA
Explanation: The Ontario PPSA applies a functional approach: a conditional sale that secures payment is a security interest even though the seller purports to retain title. Form labels such as 'title retention' do not take the transaction outside the Act. The seller must therefore perfect and observe PPSA priority and remedies rules.
2A lender takes a chattel mortgage over a borrower's delivery truck to secure a loan. For PPSA purposes, which statement is most accurate?
A.The chattel mortgage creates a security interest in personal property governed by the PPSA
B.Chattel mortgages are exclusively governed by land-title rules and fall outside the PPSA
C.A chattel mortgage is valid only if registered under the Registry Act for real property
D.The PPSA abolishes chattel mortgages, so the document is void
Explanation: A chattel mortgage is a classic security device over goods. Under the PPSA's functional approach, it creates a security interest in personal property and is governed by the Act's attachment, perfection, and priority rules. Registration is through the Personal Property Security Registry financing statement system, not real-property land titles.
3A film production company assigns its present and future accounts receivable to a financier as security for financing. Under the Ontario PPSA, which statement best describes the assignment?
A.An assignment of accounts that secures an obligation is generally within the PPSA's scope
B.Assignments of accounts are always absolute sales and never security interests
C.Only assignments of tangible goods can create PPSA security interests
D.Accounts receivable cannot be collateral under the Ontario PPSA
Explanation: The Ontario PPSA expressly contemplates security interests in accounts. An assignment of accounts receivable that secures payment or performance is within the Act's scope and must be perfected, typically by registration. Absolute true sales of accounts may raise different characterization issues, but a security assignment is classic PPSA collateral.
4A dealer delivers inventory to a retailer under a 'consignment' arrangement. The Ontario PPSA may still apply. Which feature most strongly indicates that a consignment falls within the Act?
A.The arrangement is a commercial consignment of the kind the PPSA brings within its scope even without a traditional security purpose label
B.Any delivery of goods on approval is automatically outside the PPSA
C.Consignments are governed only by the Sale of Goods Act and never by the PPSA
D.The PPSA applies to consignments only if the consignor is a bank
Explanation: The Ontario PPSA extends to certain consignments (see s. 2 and related definitions), bringing commercial consignment arrangements into the Act's publicity and priority regime. Parties cannot avoid PPSA consequences merely by calling the arrangement a consignment when it meets the statutory criteria.
5A lessor leases a photocopier to a business for a fixed term of three years. Under Ontario PPSA amendments reflected on the NCA syllabus, when does the PPSA generally apply to a lease?
A.When it is a lease for a term of more than one year (as defined), bringing the lessor's interest within the Act
B.Only when the lease is for a term of less than thirty days
C.Never; true leases are always excluded from the Ontario PPSA
D.Only when the leased goods are real property fixtures
Explanation: Ontario amendments brought leases for a term of more than one year within the PPSA's scope, so that long-term lease interests are subject to registration and priority rules even if the lease is a 'true lease' rather than a disguised security interest. Short-term leases are treated differently under the statutory definition.
6Which of the following interests is most likely excluded from the scope of the Ontario PPSA under the Act's exclusion provisions?
A.A repairer's common-law or statutory possessory lien arising from work on goods
B.A bank's perfected security interest in inventory
C.A conditional seller's reserved-title security interest in equipment
D.A lessor's interest under a three-year equipment lease
Explanation: PPSA s. 4 excludes certain interests, including liens given by statute or rule of law for providing goods, services, or materials in respect of goods (subject to the Act's precise wording). Ordinary consensual security interests, conditional sales, and long-term leases are within scope, not excluded as such liens.
7What is a primary policy purpose of a modern Personal Property Security Act registry system?
A.To provide a notice-based public registry so third parties can discover competing claims to personal property collateral
B.To transfer legal title of all financed goods automatically to the secured party
C.To replace the Bankruptcy and Insolvency Act for all insolvency proceedings
D.To abolish priority contests by making all security interests equal
Explanation: The PPSA establishes a notice-filing system. Registration of a financing statement gives public notice of a claimed security interest so subsequent creditors, buyers, and other searchers can discover it. It does not itself transfer title, replace insolvency statutes, or eliminate priority rules.
8A security agreement grants a lender a security interest in 'all present and after-acquired personal property' of the debtor. Under the Ontario PPSA approach reflected in the syllabus, which statement is correct?
A.A security interest may extend to after-acquired property, subject to statutory attachment and description requirements
B.After-acquired property clauses are always void as against public policy
C.Only goods owned on the signing date can ever become collateral
D.After-acquired property can be covered only if each new asset is listed in a new deed
Explanation: The PPSA expressly contemplates after-acquired property. A properly drafted security agreement can create a floating-style interest that attaches when the debtor acquires rights in new collateral, without a fresh deed for each asset, subject to attachment rules and financing-statement description requirements.
9In Joseph Group of Companies v. Pickles Tents and Awnings Ltd., a case on the NCA Commercial Law syllabus, the dispute illustrates which broader PPSA theme?
A.How traditional title-based or older security devices are brought within a functional PPSA analysis
B.That only banks may take security interests in tents and awnings
C.That the Sale of Goods Act exclusively governs all inventory financings
D.That oral security agreements are always unenforceable in Manitoba and Ontario
Explanation: Syllabus cases such as Pickles Tents address the application of PPSA concepts to commercial financing arrangements and the treatment of security devices within the modern personal property security regime. The teaching point is functional coverage and priority analysis, not industry-specific or formalistic limits invented outside the Act.
10A creditor takes a written guarantee from a principal's shareholder securing the corporation's PPSA-secured indebtedness. Under Ontario PPSA provisions concerning personal guarantees (as treated on the syllabus), which concern is most characteristic?
A.Statutory rules about the enforceability and relationship of guarantees to the secured obligation and collateral realizations
B.A rule that personal guarantees automatically perfect a security interest in land
C.A rule that a guarantee replaces the need for any security agreement with the principal debtor
D.A rule that guarantors can never waive notice of disposition
Explanation: The syllabus flags PPSA provisions dealing with personal guarantees (including s. 17 themes and related case law such as First City Capital v. Hall). The focus is how guarantees interact with the secured obligation and enforcement, not transforming the guarantee into real-property perfection or eliminating the need for a security agreement with the debtor.
About the NCA Commercial Law Practice Questions
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