Question 1

Usually, a court will not award an equitable remedy unless the remedy at law is inadequate.

Accepted Answer

A) True 
 B)False

Question 2

Cow's Milk Creamery, Inc., needs a certain part for its pasteurizing equipment to continue its operations and orders one for $3,000 from Dairy Supplies Company. Cow's Milk tells Dairy Supplies that it must receive the part by Tuesday or it will lose $10,000. Dairy Supplies ships the part late. Cow's Milk can recover

Accepted Answer

A)  ​$13,000. 
B)  ​$10,000. 
C)  ​$3,000. 
D)  ​$0. 
A)  ​$13,000. 
B)  ​$10,000. 
C)  ​$3,000. 
D)  ​$0.

Question 3

Mother & Daughter Jewelers breaches its lease with Longview Mall and vacates the premises six months before the end of the term. In some states, Longview would have to

Accepted Answer

A)  ​avoid reletting the premises to recover damages. 
B)  ​use reasonable means to find a new tenant to mitigate damages. 
C)  ​relet the premises to recover any damages. 
D)  ​sell the premises to recover any damages. 
A)  ​avoid reletting the premises to recover damages. 
B)  ​use reasonable means to find a new tenant to mitigate damages. 
C)  ​relet the premises to recover any damages. 
D)  ​sell the premises to recover any damages.

Question 4

Nominal damages are designed to punish a wrongdoer and set an example to deter similar conduct in the future.

Accepted Answer

A) True 
 B)False

Question 5

Reformation is an equitable remedy that allows a court to rewrite a contract to suit itself.

Accepted Answer

A) True 
 B)False

Question 6

Metro Holding Company agrees to sell a vacant lot to New Town Property LLC. The contract provides that if Metro does not close the deal by October 15, it must pay New Town one-half of the contract price. This provision is not enforceable because it is

Accepted Answer

A)  ​a liquidated damages clause. 
B)  ​an exculpatory clause. 
C)  ​a limitation-of-liability clause. 
D)  ​a penalty clause. 
A)  ​a liquidated damages clause. 
B)  ​an exculpatory clause. 
C)  ​a limitation-of-liability clause. 
D)  ​a penalty clause.

Question 7

Under the doctrine of mitigation of damages, the duty owed depends on the nature of the contract.

Accepted Answer

A) True 
 B)False

Question 8

Bread & Bagels Bakery (B&B) enters into a contract with CinePass for discounted movie tickets for B&B's employees. CinePass breaches the contract and B&B enters into a contract with Dine+View for the same service at a lower price. B&B might be awarded nominal damages to

Accepted Answer

A)  ​establish, as a matter of principle, that CinePass acted wrongfully. 
B)  ​provide B&B with funds for a foreseeable loss beyond the contract. 
C)  ​provide B&B with funds for its loss of the bargain. 
D)  ​punish CinePass and set an example to deter others from similar acts. 
A)  ​establish, as a matter of principle, that CinePass acted wrongfully. 
B)  ​provide B&B with funds for a foreseeable loss beyond the contract. 
C)  ​provide B&B with funds for its loss of the bargain. 
D)  ​punish CinePass and set an example to deter others from similar acts.

Question 9

​Rescission is an equitable remedy used when the parties have imperfectly expressed their agreement in writing.

Accepted Answer

A) True 
 B)False

Question 10

Specific performance will not be granted unless the party's legal remedy is inadequate.

Accepted Answer

A) True 
 B)False

Question 11

Damages that compensate the nonbreaching party for the loss of a bargain are known as consecutive damages.

Accepted Answer

A) True 
 B)False

Question 12

Sara contracts to work exclusively for Thermal Company during July for $5,000. On June 30, Thermal cancels the contract. Sara finds a similar job for the month of July but earns only $3,000. Sara files a suit against Thermal. As compensatory damages, Sara can recover

Accepted Answer

A)  ​$3,000. 
B)  ​$2,000. 
C)  ​$1,000. 
D)  ​$0. 
A)  ​$3,000. 
B)  ​$2,000. 
C)  ​$1,000. 
D)  ​$0.

Question 13

Dry Gulch Farms hires Elliot to repair its irrigation system on site on a certain date for $2,500, but Elliot does not show up as agreed. Dry Gulch hires Fernando to do the job for $2,000. Dry Gulch may recover from Elliot

Accepted Answer

A)  ​nothing. 
B)  ​compensatory damages. 
C)  ​consequential damages. 
D)  ​nominal damages. 
A)  ​nothing. 
B)  ​compensatory damages. 
C)  ​consequential damages. 
D)  ​nominal damages.

Question 14

Porches & Verandas, Inc., agrees to build a screen porch for Quinn, but fails to complete the job. Quinn hires Ramadas, Inc., to finish the project. Quinn may recover from Porches & Verandas

Accepted Answer

A)  ​the contract price less costs of materials and labor. 
B)  ​the contract price. 
C)  ​the costs needed to complete construction. 
D)  ​profits plus the costs incurred up to the time of the breach. 
A)  ​the contract price less costs of materials and labor. 
B)  ​the contract price. 
C)  ​the costs needed to complete construction. 
D)  ​profits plus the costs incurred up to the time of the breach.

Question 15

In most situations, when a breach of contract occurs, the innocent injured party is held to a duty to mitigate the damages.​

Accepted Answer

A) True 
 B)False

Question 16

Ida orally agrees to pay Jim to seed and harvest a quarter of Ida's farm acreage for four hay seasons. After Jim prepares the land and plants the first crop, Ida says that their deal is off. Jim can most likely recover on a theory of

Accepted Answer

A)  ​reformation. 
B)  ​restitution. 
C)  ​liquidated damages. 
D)  ​quasi contract. 
A)  ​reformation. 
B)  ​restitution. 
C)  ​liquidated damages. 
D)  ​quasi contract.

Question 17

Builders, Inc., agrees to construct an office building for Champ Fitness Clubs, Inc. The project proceeds according to plan, but before it is done, Champ tells Builders to quit. Builders may recover

Accepted Answer

A)  ​the contract price less costs of materials and labor. 
B)  ​the contract price. 
C)  ​the costs needed to complete construction. 
D)  ​profits plus the costs incurred up to the time of the breach. 
A)  ​the contract price less costs of materials and labor. 
B)  ​the contract price. 
C)  ​the costs needed to complete construction. 
D)  ​profits plus the costs incurred up to the time of the breach.

Question 18

Tile & Grout (T&G) contracts to resurface the insides of the pools at Water Park. T&G knows that without the resurfacing, Water Park will have to delay its seasonal opening. T&G does not perform as promised. As consequential damages, Water Park can recover

Accepted Answer

A)  ​the cost of new pools. 
B)  ​the difference between T&G's price and the eventual cost of resurfacing. 
C)  ​the loss of profit from the delayed opening. 
D)  ​nothing. 
A)  ​the cost of new pools. 
B)  ​the difference between T&G's price and the eventual cost of resurfacing. 
C)  ​the loss of profit from the delayed opening. 
D)  ​nothing.

Question 19

A party seeking to recover in quasi contract must show that the other party has been unjustly enriched.

Accepted Answer

A) True 
 B)False

Question 20

Guido and Hal want to rescind their contract under which Guido sold Hal a mountain bike for $100. To rescind the contract

Accepted Answer

A)  ​Guido must return the $100 and Hal must return the bike. 
B)  ​Guido must return the $100 only. 
C)  ​Hal must return the bike only. 
D)  ​the parties can keep the "benefits" of their bargain. 
A)  ​Guido must return the $100 and Hal must return the bike. 
B)  ​Guido must return the $100 only. 
C)  ​Hal must return the bike only. 
D)  ​the parties can keep the "benefits" of their bargain.

Exam 19: Breach of Contract and Remedies

Usually, a court will not award an equitable remedy unless the remedy at law is inadequate.

Mother & Daughter Jewelers breaches its lease with Longview Mall and vacates the premises six months before the end of the term. In some states, Longview would have to

Nominal damages are designed to punish a wrongdoer and set an example to deter similar conduct in the future.

Reformation is an equitable remedy that allows a court to rewrite a contract to suit itself.

Metro Holding Company agrees to sell a vacant lot to New Town Property LLC. The contract provides that if Metro does not close the deal by October 15, it must pay New Town one-half of the contract price. This provision is not enforceable because it is

Under the doctrine of mitigation of damages, the duty owed depends on the nature of the contract.

Bread & Bagels Bakery (B&B) enters into a contract with CinePass for discounted movie tickets for B&B's employees. CinePass breaches the contract and B&B enters into a contract with Dine+View for the same service at a lower price. B&B might be awarded nominal damages to

​Rescission is an equitable remedy used when the parties have imperfectly expressed their agreement in writing.

Specific performance will not be granted unless the party's legal remedy is inadequate.

Damages that compensate the nonbreaching party for the loss of a bargain are known as consecutive damages.

Sara contracts to work exclusively for Thermal Company during July for $5,000. On June 30, Thermal cancels the contract. Sara finds a similar job for the month of July but earns only $3,000. Sara files a suit against Thermal. As compensatory damages, Sara can recover

Dry Gulch Farms hires Elliot to repair its irrigation system on site on a certain date for $2,500, but Elliot does not show up as agreed. Dry Gulch hires Fernando to do the job for $2,000. Dry Gulch may recover from Elliot

Porches & Verandas, Inc., agrees to build a screen porch for Quinn, but fails to complete the job. Quinn hires Ramadas, Inc., to finish the project. Quinn may recover from Porches & Verandas

In most situations, when a breach of contract occurs, the innocent injured party is held to a duty to mitigate the damages.​

Ida orally agrees to pay Jim to seed and harvest a quarter of Ida's farm acreage for four hay seasons. After Jim prepares the land and plants the first crop, Ida says that their deal is off. Jim can most likely recover on a theory of

Builders, Inc., agrees to construct an office building for Champ Fitness Clubs, Inc. The project proceeds according to plan, but before it is done, Champ tells Builders to quit. Builders may recover

Tile & Grout (T&G) contracts to resurface the insides of the pools at Water Park. T&G knows that without the resurfacing, Water Park will have to delay its seasonal opening. T&G does not perform as promised. As consequential damages, Water Park can recover

A party seeking to recover in quasi contract must show that the other party has been unjustly enriched.

Guido and Hal want to rescind their contract under which Guido sold Hal a mountain bike for $100. To rescind the contract

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Rescission is an equitable remedy used when the parties have imperfectly expressed their agreement in writing.

In most situations, when a breach of contract occurs, the innocent injured party is held to a duty to mitigate the damages.