Question 1

Jennifer substantially performs her service contract with Gretchen.Due to Jennifer's failure to render complete performance,Gretchen:

Accepted Answer

A)  is discharged from any further contractual obligations. 
B)  is required to pay the full contract price, minus the value of Jennifer's defective performance. 
C)  is required to pay the full contract price. 
D)  may declare a material breach and pay only for the value received. 
A)  is discharged from any further contractual obligations. 
B)  is required to pay the full contract price, minus the value of Jennifer's defective performance. 
C)  is required to pay the full contract price. 
D)  may declare a material breach and pay only for the value received.

Question 2

Al contracted to sell his house to Bev.Subsequently,they both changed their minds and agreed to cancel the contract.The contract between Al and Bev is discharged by:

Accepted Answer

A)  full performance. 
B)  rescission. 
C)  accord and satisfaction. 
D)  novation. 
A)  full performance. 
B)  rescission. 
C)  accord and satisfaction. 
D)  novation.

Question 3

Specific performance may be available for the breach of a contract to sell:

Accepted Answer

A)  an original painting. 
B)  20 shares of AT&T stock. 
C)  a red "Radio Flyer" wagon, available at toy stores. 
D)  a 2009 Lexus in mint condition. 
A)  an original painting. 
B)  20 shares of AT&T stock. 
C)  a red "Radio Flyer" wagon, available at toy stores. 
D)  a 2009 Lexus in mint condition.

Question 4

Compensatory damages are typically assessed against the breaching party:

Accepted Answer

A)  as a penalty for breaching the contract. 
B)  only under the UCC when the sale of goods is the subject of the contract. 
C)  to put the non-breaching party in the position it would have been in had the contract never been formed. 
D)  to put the non-breaching party in the position it would have been in if the contract hadn't been breached. 
A)  as a penalty for breaching the contract. 
B)  only under the UCC when the sale of goods is the subject of the contract. 
C)  to put the non-breaching party in the position it would have been in had the contract never been formed. 
D)  to put the non-breaching party in the position it would have been in if the contract hadn't been breached.

Question 5

Dr.Gonzalez ordered specialized surgical equipment from Physician's Supply Co.,but her order was not delivered by the agreed date.Dr.Gonzalez is under no obligation to minimize damages since the contract was breached by Physician's Supply,not Dr.Gonzalez.

Accepted Answer

A) True 
 B)False

Question 6

Ramon purchased 5,000 pounds of coffee from Quick Jump Coffee.The coffee was to be delivered on September 1.Since the contract included a date for performance,time is of the essence.

Accepted Answer

A) True 
 B)False

Question 7

In a construction contract,there is a $1,000 per day estimate of damages for each day that the contract runs over the completion date.The contractor is 30 days late when the job is completed,resulting in a prospective damage award of $30,000.What is this type of clause,and when will it be enforced?

Accepted Answer

This type of clause is known as a liquid

Question 8

The objective of a(n)____________ is to restore to the injured party the benefit he provided.

Accepted Answer

A)  expectation interest. 
B)  reliance interest. 
C)  restitution interest. 
D)  equitable interest. 
A)  expectation interest. 
B)  reliance interest. 
C)  restitution interest. 
D)  equitable interest.

Question 9

Liquidated damages are awarded to parties who have experienced an injury to their legal rights but have no actual loss.

Accepted Answer

A) True 
 B)False

Question 10

Courts use a two-part test to determine if a party has substantially performed its contractual duties.

Accepted Answer

A) True 
 B)False

Question 11

Costs to rent a vehicle for a short period of time after an auto dealer fails to deliver a purchased vehicle would be:

Accepted Answer

A)  compensatory damages. 
B)  incidental damages. 
C)  consequential damages. 
D)  punitive damages. 
A)  compensatory damages. 
B)  incidental damages. 
C)  consequential damages. 
D)  punitive damages.

Question 12

In promissory estoppel cases:

Accepted Answer

A)  courts award compensatory and incidental damages. 
B)  courts generally award only reliance damages. 
C)  the restitution interest is primary, and courts generally award only restitution. 
D)  consequential and incidental damages are generally awarded. 
A)  courts award compensatory and incidental damages. 
B)  courts generally award only reliance damages. 
C)  the restitution interest is primary, and courts generally award only restitution. 
D)  consequential and incidental damages are generally awarded.

Question 13

M & E contracted to sell 500 music stands to Coda,Inc.M & E shipped the stands in accordance with the agreement.Coda paid for the stands as promised.The contract between M & E and Coda is discharged by:

Accepted Answer

A)  full performance. 
B)  agreement. 
C)  rescission. 
D)  accord and satisfaction. 
A)  full performance. 
B)  agreement. 
C)  rescission. 
D)  accord and satisfaction.

Question 14

The concept that an injured party may recover consequential damages only if the breaching party should have foreseen them was established in:

Accepted Answer

A)  Brunswick Hills Racquet Club, Inc. v. Route 18 Shopping Center Associates. 
B)  Milicic v. Basketball Marketing Company, Inc. 
C)  Hadley v. Baxendale. 
D)  Rosenberg v. Son, Inc. 
A)  Brunswick Hills Racquet Club, Inc. v. Route 18 Shopping Center Associates. 
B)  Milicic v. Basketball Marketing Company, Inc. 
C)  Hadley v. Baxendale. 
D)  Rosenberg v. Son, Inc.

Question 15

If one party materially breaches a contract,the other party is not only discharged from its performance but may also sue for damages.

Accepted Answer

A) True 
 B)False

Question 16

The interest designed to return to the injured party a benefit that he has conferred on the other party,which it would be unjust to leave with that person is the:

Accepted Answer

A)  restitution interest. 
B)  reliance interest. 
C)  expectation interest. 
D)  equitable interest. 
A)  restitution interest. 
B)  reliance interest. 
C)  expectation interest. 
D)  equitable interest.

Question 17

Virginia,a CPA,fails to complete an audit by the March 30 deadline in her "time of the essence" contract with Waymuth Corp.The corporation is legally obligated to allow Virginia a reasonable extension.

Accepted Answer

A) True 
 B)False

Question 18

Courts typically divide the expectation damages into:

Accepted Answer

A)  four parts, which are direct damages, special damages, incidental damages, and liquidated damages. 
B)  four parts, which are compensatory damages, incidental damages, nominal damages, and consequential damages. 
C)  three parts, which are compensatory damages, consequential damages, and incidental damages. 
D)  only two parts, which are incidental damages and consequential damages. 
A)  four parts, which are direct damages, special damages, incidental damages, and liquidated damages. 
B)  four parts, which are compensatory damages, incidental damages, nominal damages, and consequential damages. 
C)  three parts, which are compensatory damages, consequential damages, and incidental damages. 
D)  only two parts, which are incidental damages and consequential damages.

Question 19

If the purpose of a contract becomes illegal,that discharges the contract because of impossibility.

Accepted Answer

A) True 
 B)False

Question 20

Identify four factors courts consider in deciding commercial impracticability and frustration of purpose claims.

Accepted Answer

In deciding whether a change in circumst

Exam 11: Conclusion to Contracts

Jennifer substantially performs her service contract with Gretchen.Due to Jennifer's failure to render complete performance,Gretchen:

Al contracted to sell his house to Bev.Subsequently,they both changed their minds and agreed to cancel the contract.The contract between Al and Bev is discharged by:

Specific performance may be available for the breach of a contract to sell:

Compensatory damages are typically assessed against the breaching party:

Dr.Gonzalez ordered specialized surgical equipment from Physician's Supply Co.,but her order was not delivered by the agreed date.Dr.Gonzalez is under no obligation to minimize damages since the contract was breached by Physician's Supply,not Dr.Gonzalez.

Ramon purchased 5,000 pounds of coffee from Quick Jump Coffee.The coffee was to be delivered on September 1.Since the contract included a date for performance,time is of the essence.

In a construction contract,there is a $1,000 per day estimate of damages for each day that the contract runs over the completion date.The contractor is 30 days late when the job is completed,resulting in a prospective damage award of $30,000.What is this type of clause,and when will it be enforced?

The objective of a(n)____________ is to restore to the injured party the benefit he provided.

Liquidated damages are awarded to parties who have experienced an injury to their legal rights but have no actual loss.

Courts use a two-part test to determine if a party has substantially performed its contractual duties.

Costs to rent a vehicle for a short period of time after an auto dealer fails to deliver a purchased vehicle would be:

In promissory estoppel cases:

M & E contracted to sell 500 music stands to Coda,Inc.M & E shipped the stands in accordance with the agreement.Coda paid for the stands as promised.The contract between M & E and Coda is discharged by:

The concept that an injured party may recover consequential damages only if the breaching party should have foreseen them was established in:

If one party materially breaches a contract,the other party is not only discharged from its performance but may also sue for damages.

The interest designed to return to the injured party a benefit that he has conferred on the other party,which it would be unjust to leave with that person is the:

Virginia,a CPA,fails to complete an audit by the March 30 deadline in her "time of the essence" contract with Waymuth Corp.The corporation is legally obligated to allow Virginia a reasonable extension.

Courts typically divide the expectation damages into:

If the purpose of a contract becomes illegal,that discharges the contract because of impossibility.

Identify four factors courts consider in deciding commercial impracticability and frustration of purpose claims.

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