Question 1

The UCC governs damages for a breach of a sales contract involving goods.

Accepted Answer

A) True 
 B)False

Question 2

Only those consequential damages that are unforeseeable can be collected.

Accepted Answer

A) True 
 B)False

Question 3

Intentional interference with contractual relations requires a showing of bad faith before liability can be imposed.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following is true about the recovery of punitive damages in connection with contracts?

Accepted Answer

A)  They are recoverable whenever a breach of contract is intentional. 
B)  If awarded,they are held by the court to be distributed to other parties with whom the defendant has breached a contract. 
C)  They can be covered for tortious conduct in connection with a contract,but generally not for the breach of a contract. 
D)  They are awarded only by an appellate court. 
A)  They are recoverable whenever a breach of contract is intentional. 
B)  If awarded,they are held by the court to be distributed to other parties with whom the defendant has breached a contract. 
C)  They can be covered for tortious conduct in connection with a contract,but generally not for the breach of a contract. 
D)  They are awarded only by an appellate court.

Question 5

Justin purchased a new Ford Thunderbird in April of 2003.This was to be Justin's midlife crisis car and would not be used in everyday driving.He did not sell his current car and would continue to drive it most of the time.Even though this was a low-volume car,Justin wanted his to be unique.He entered into a contract on May 1,2003 with a firm to make a custom interior for the car,with the job to be completed on June 11,2003.The customizer informed Justin on May 10 that the car would not be ready until late June.On June 12,2003,Justin rented a 2003 Thunderbird Convertible from a specialty car rental company at a cost of $120 a day until his car was ready on June 29.Can Justin recover his car rental cost from the customizer?

Accepted Answer

Given that Justin did not need

Question 6

When one party substantially,but not completely,performs a contract,creating a minor breach,which of the following remedies may the aggrieved party choose?

Accepted Answer

A)  deduct the cost necessary to complete performance from the payment due to the breaching party 
B)  sue the breaching party for the cost to complete performance 
C)  rescind the contract 
D)  A,B,and C 
E)  A and B only 
A)  deduct the cost necessary to complete performance from the payment due to the breaching party 
B)  sue the breaching party for the cost to complete performance 
C)  rescind the contract 
D)  A,B,and C 
E)  A and B only

Question 7

Pat Painter contracts to paint Harry Homeowner's home for $6,000.Pat would supply all materials at a cost to Pat of $1,000.Harry breaches by refusing to let Pat paint the house,which Pat found out before spending any money on the materials.Pat is able to find another job that nets a profit of $4,200 during that same time that Harry's house was to be painted.How much can Pat recover from Harry in damages?

Accepted Answer

A)  $1 
B)  $800 
C)  $1,800 
D)  $3,200 
E)  $5,000 
A)  $1 
B)  $800 
C)  $1,800 
D)  $3,200 
E)  $5,000

Question 8

Damages that are fixed in the contract for the amount to be awarded in the event of a breach are known as:

Accepted Answer

A)  punitive damages 
B)  liquidated damages 
C)  consequential damages 
D)  conditional damages 
A)  punitive damages 
B)  liquidated damages 
C)  consequential damages 
D)  conditional damages

Question 9

Specific performance is generally awarded:

Accepted Answer

A)  in cases where nominal damages are also awarded 
B)  where the contract involves the sale of property that is unique 
C)  only under the UCC 
D)  when the nonbreaching party requests it 
E)  only if provided for in a liquidated damages clause 
A)  in cases where nominal damages are also awarded 
B)  where the contract involves the sale of property that is unique 
C)  only under the UCC 
D)  when the nonbreaching party requests it 
E)  only if provided for in a liquidated damages clause

Question 10

A buyer can generally recover the additional cost of acquiring substitute goods if the seller breaches by not delivering the goods.

Accepted Answer

A) True 
 B)False

Question 11

The Smiths hire a contractor to build a home for them.The total cost of the contract is for $110,000.Some of the building materials are delivered,and the contractor refuses to build the house.An alternate contractor agrees to build the house using the same materials for $125,000.Are the Smiths entitled to damages? If so,how much?

Accepted Answer

A)  No; the contract was terminated before construction began and the house was still built. 
B)  Yes; they are entitled to contract damages in the amount of $15,000. 
C)  Yes; they are entitled to contract damages in the amount of $110,000. 
D)  Yes; they are entitled to contract damages in the amount of $125,000. 
A)  No; the contract was terminated before construction began and the house was still built. 
B)  Yes; they are entitled to contract damages in the amount of $15,000. 
C)  Yes; they are entitled to contract damages in the amount of $110,000. 
D)  Yes; they are entitled to contract damages in the amount of $125,000.

Question 12

Under which kind(s)of performance by the other party can a party rescind a contract?

Accepted Answer

A)  substantial performance 
B)  inferior performance 
C)  both A and B 
D)  neither A nor B 
A)  substantial performance 
B)  inferior performance 
C)  both A and B 
D)  neither A nor B

Question 13

Alice has a contract with a surgeon to have a medical procedure performed on July 17.The surgeon notifies Alice on July 5 that he is in the Bahamas and will be there until the end of August and will not be able to do the surgery.Which of the following is true at this point?

Accepted Answer

A)  There will be no breach until July 17. 
B)  Alice must wait until July 17,and if the surgeon does not perform the procedure,then Alice can contract with another surgeon. 
C)  If Alice contracts with another surgeon prior to July 17,and this second surgeon is aware of Alice's original contract,the second surgeon has no obligation to perform. 
D)  Alice is free to contract with another surgeon. 
A)  There will be no breach until July 17. 
B)  Alice must wait until July 17,and if the surgeon does not perform the procedure,then Alice can contract with another surgeon. 
C)  If Alice contracts with another surgeon prior to July 17,and this second surgeon is aware of Alice's original contract,the second surgeon has no obligation to perform. 
D)  Alice is free to contract with another surgeon.

Question 14

When an employer breaches an employment contract,what obligation does the employee have in seeking substitute employment?

Accepted Answer

A)  Because it was the employer who breached,the employee has no obligation to seek substitute employment. 
B)  The employee must accept any employment available with the same employer,but is not required to accept any substitute employment with a different employer. 
C)  The employee must accept any employment available with a different employer,but is not required to accept any substitute employment with the same employer. 
D)  The employee is obligated to accept any employment for which the employee is qualified. 
E)  The employee is obligated to accept substitute employment only if it is comparable employment. 
A)  Because it was the employer who breached,the employee has no obligation to seek substitute employment. 
B)  The employee must accept any employment available with the same employer,but is not required to accept any substitute employment with a different employer. 
C)  The employee must accept any employment available with a different employer,but is not required to accept any substitute employment with the same employer. 
D)  The employee is obligated to accept any employment for which the employee is qualified. 
E)  The employee is obligated to accept substitute employment only if it is comparable employment.

Question 15

A contract that has been fully performed by all parties is said to be:

Accepted Answer

A)  executed 
B)  tendered 
C)  mitigated 
D)  liquidated 
E)  substantiated 
A)  executed 
B)  tendered 
C)  mitigated 
D)  liquidated 
E)  substantiated

Question 16

Mitigation of damages is no longer necessary in the area of employment law.

Accepted Answer

A) True 
 B)False

Question 17

What is tender of performance in connection with a contract?

Accepted Answer

A)  one party's completion of duties under the contract 
B)  a party's offering substitute performance that is superior to the performance called for in the contract 
C)  performance whose terms have been ordered by the court 
D)  an unconditional offer by a contracting party to perform his or her obligations under a contract 
A)  one party's completion of duties under the contract 
B)  a party's offering substitute performance that is superior to the performance called for in the contract 
C)  performance whose terms have been ordered by the court 
D)  an unconditional offer by a contracting party to perform his or her obligations under a contract

Question 18

What does the term "mitigation" refer to in connection with damages?

Accepted Answer

A)  the calculation of lost profits in determining damages 
B)  the duty of the breaching party to make a damages payment as soon as practical 
C)  the combination of the different kinds of damages into a single dollar amount 
D)  the duty of a nonbreaching party to make reasonable efforts to reduce damages 
E)  the requirement of the nonbreaching party to allow the breaching party one final chance to perform the contract before being entitled to collect damages 
A)  the calculation of lost profits in determining damages 
B)  the duty of the breaching party to make a damages payment as soon as practical 
C)  the combination of the different kinds of damages into a single dollar amount 
D)  the duty of a nonbreaching party to make reasonable efforts to reduce damages 
E)  the requirement of the nonbreaching party to allow the breaching party one final chance to perform the contract before being entitled to collect damages

Question 19

A liquidated damages provision will be validated if it is considered to be a penalty.

Accepted Answer

A) True 
 B)False

Question 20

A court will not enforce a liquidated damages clause when which of the following is true?

Accepted Answer

A)  The amount specified is too small and considered to be unfair. 
B)  The amount of actual damages is significantly greater than the amount specified as liquidated damages. 
C)  The amount was agreed to by the parties prior to the existence of an actual breach. 
D)  The amount is so large that it is viewed as a penalty. 
E)  The actual damages are difficult to determine and compare to the amount specified as liquidated damages. 
A)  The amount specified is too small and considered to be unfair. 
B)  The amount of actual damages is significantly greater than the amount specified as liquidated damages. 
C)  The amount was agreed to by the parties prior to the existence of an actual breach. 
D)  The amount is so large that it is viewed as a penalty. 
E)  The actual damages are difficult to determine and compare to the amount specified as liquidated damages.

Exam 16: Remedies for Breach of Traditional and E-Contracts

The UCC governs damages for a breach of a sales contract involving goods.

Only those consequential damages that are unforeseeable can be collected.

Intentional interference with contractual relations requires a showing of bad faith before liability can be imposed.

Which of the following is true about the recovery of punitive damages in connection with contracts?

When one party substantially,but not completely,performs a contract,creating a minor breach,which of the following remedies may the aggrieved party choose?

Damages that are fixed in the contract for the amount to be awarded in the event of a breach are known as:

Specific performance is generally awarded:

A buyer can generally recover the additional cost of acquiring substitute goods if the seller breaches by not delivering the goods.

Under which kind(s)of performance by the other party can a party rescind a contract?

Alice has a contract with a surgeon to have a medical procedure performed on July 17.The surgeon notifies Alice on July 5 that he is in the Bahamas and will be there until the end of August and will not be able to do the surgery.Which of the following is true at this point?

When an employer breaches an employment contract,what obligation does the employee have in seeking substitute employment?

A contract that has been fully performed by all parties is said to be:

Mitigation of damages is no longer necessary in the area of employment law.

What is tender of performance in connection with a contract?

What does the term "mitigation" refer to in connection with damages?

A liquidated damages provision will be validated if it is considered to be a penalty.

A court will not enforce a liquidated damages clause when which of the following is true?

Legal Heritage and the Information Age

Court Systems and Jurisdiction

Judicial, Alternative, and Online Dispute Resolution

Constitutional Law for Business and E-Commerce

Intentional Torts and Negligence

Strict Liability and Product Liability

Intellectual Property and Cyber Piracy

Criminal Law and Cyber Crimes

Nature of Traditional and E-Contracts

Agreement

Consideration and Promissory Estoppel

Capacity and Legality

Genuineness of Assent and Undue Influence

Statute of Frauds and Equitable Exceptions

Third-Party Rights and Discharge

Internet Law and E-Commerce

Formation of Sales and Lease Contracts

Title to Goods and Risk of Loss

Remedies for Breach of Sales and Lease Contracts

Sales and Lease Warranties

Creation of Negotiable Instruments

Transferability and Holder In Due Course

Liability,Defenses and Discharge

Checks, the Banking System, and E-Money

Creditor's and Debtor's Rights

Secured Transactions and Electronic Filing

Bankruptcy and Reorganization

Agency Formation and Termination

Liability of Principals, Agents, and Independent Contractors

Employment,Worker Protection,and Immigration Laws

Labor Law and Collective Bargaining

Equal Opportunity in Employment

Small Businesses, Entrepreneurs, and General Partnerships

Limited Partnerships and Limited Liability Limited Partnerships

Corporate Formation and Financing

Corporate Governance and the Sarbanes Oxley Act

Corporate Acquisitions and Multinational Corporations

Limited Liability Companies and Limited Liability Partnerships

Franchises and Special Forms of Business

Investor Protection and Online Securities Transactions

Ethics and Social Responsibility of Business

Administrative Law and Regulatory Agencies

Consumer Protection and Product Safety

Environmental Protection and Global Warming

Antitrust Law and Unfair Trade Practices

Personal Property and Bailment

Real Property

Landlord Tenant Law and Land Use Regulation

Insurance

Accountants' Liability

Wills, Trusts, and Elder Law

Family Law

International and World Trade Law

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