Question 1

Restitution is an action to undo a contract.

Accepted Answer

A) True 
 B)False

Question 2

To be liable for consequential damages, the breaching party need not know nor have reason to know that the breach will cause special damages to the other party.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is true of specific performance?

Accepted Answer

A)  Specific performance of personal service contracts is not granted. 
B)  Specific performance is not awarded if the subject matter of the contract is unique. 
C)  Specific performance exempts works of art, antiques, and heirlooms as subject matter. 
D)  Specific performance is not available to enforce land contracts. 
A)  Specific performance of personal service contracts is not granted. 
B)  Specific performance is not awarded if the subject matter of the contract is unique. 
C)  Specific performance exempts works of art, antiques, and heirlooms as subject matter. 
D)  Specific performance is not available to enforce land contracts.

Question 4

Which of the following torts arises when a third party induces a contracting party to breach the contract with another party?

Accepted Answer

A)  intentional interference with contractual relations 
B)  breach of the covenant of good faith and fair dealing 
C)  tort of bad faith 
D)  malicious breach of contractual relations 
A)  intentional interference with contractual relations 
B)  breach of the covenant of good faith and fair dealing 
C)  tort of bad faith 
D)  malicious breach of contractual relations

Question 5

The amount of compensatory damages that will be awarded for breach of contract depends on which party breached the contract.

Accepted Answer

A) True 
 B)False

Question 6

Anticipatory repudiation occurs when one contracting party informs the other that he or she will not perform his or her contractual duties when due.

Accepted Answer

A) True 
 B)False

Question 7

If the builder breaches a construction contract either before or during construction, the owner can recover the increased cost above the contract price that he or she has to pay to have the work completed by another contractor.

Accepted Answer

A) True 
 B)False

Question 8

In an anticipatory breach, the nonbreaching party does not have the right to sue the breaching party until performance is due.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following terms refers to an unconditional and absolute offer by a contracting party to perform his or her obligations under a contract?

Accepted Answer

A)  injunction 
B)  writ of garnishment 
C)  tender of performance 
D)  writ of attachment 
A)  injunction 
B)  writ of garnishment 
C)  tender of performance 
D)  writ of attachment

Question 10

Which of the following statements is true of nominal damages?

Accepted Answer

A)  They are also known as compensatory damages. 
B)  Only damages above $1,000 can qualify as nominal damages. 
C)  Most courts favor nominal damages lawsuits. 
D)  They are awarded even when a breach did not result in financial loss. 
A)  They are also known as compensatory damages. 
B)  Only damages above $1,000 can qualify as nominal damages. 
C)  Most courts favor nominal damages lawsuits. 
D)  They are awarded even when a breach did not result in financial loss.

Question 11

________ refers to an equitable doctrine that permits the court to rewrite a contract to express the parties' true intentions.

Accepted Answer

A)  Reformation 
B)  Injunction 
C)  Conjunction 
D)  Garnishment 
A)  Reformation 
B)  Injunction 
C)  Conjunction 
D)  Garnishment

Question 12

To rescind a contract, the parties must make restitution of the consideration they received under the contract.

Accepted Answer

A) True 
 B)False

Question 13

Minor breach occurs when a party renders substantial performance of his or her contractual duties.

Accepted Answer

A) True 
 B)False

Question 14

In the event of a material breach, the nonbreaching party is discharged from further performance under the contract.

Accepted Answer

A) True 
 B)False

Question 15

When a party commits an anticipatory breach, the nonbreaching party ________.

Accepted Answer

A)  must wait until the performance was due before suing 
B)  is immediately discharged from his or her own duties 
C)  cannot seek damages because he or she received advance notice of the breach 
D)  loses his or her right to sue after the due date for performance is reached 
A)  must wait until the performance was due before suing 
B)  is immediately discharged from his or her own duties 
C)  cannot seek damages because he or she received advance notice of the breach 
D)  loses his or her right to sue after the due date for performance is reached

Question 16

Poole Contractors makes a contract with Delta Resources to pay $50,000 for the supply of 500 truckloads of sand within a week. Delta Resources delivers the sand two days after the contract was made, and Poole Contractors pays it $50,000 promised in the contract. This is an instance of ________.

Accepted Answer

A)  substantial performance 
B)  material breach 
C)  minor breach 
D)  strict performance 
A)  substantial performance 
B)  material breach 
C)  minor breach 
D)  strict performance

Question 17

Nett Labs orders 30 desktop computers from iDeal, a local computer dealer. Nett Labs requires that each computer has a 2.6 GHz processor, 500 GB hard disk, and Windows operating system. iDeal supplies 30 desktop computers, each with a 2 GHz processor, 500 GB hard disk, and Windows operating system. Which of the following terms hold true for iDeal's performance?

Accepted Answer

A)  complete performance 
B)  material breach 
C)  substantial performance 
D)  anticipatory breach 
A)  complete performance 
B)  material breach 
C)  substantial performance 
D)  anticipatory breach

Question 18

Intentional interference with contractual relations arises when a third party induces a contracting party to breach the contract with another party.

Accepted Answer

A) True 
 B)False

Question 19

Strict performance by a party discharges that party's duties under the contract.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following hold true in a case of liquidated damages?

Accepted Answer

A)  For liquidated damages to be lawful, the actual damages must be precisely determined. 
B)  Liquidated damages are enforceable even if actual damages are later determined to be different. 
C)  A liquidated damages clause is considered a penalty if actual damages are not determinable in advance. 
D)  If a liquidated damages clause is found to be a penalty, it continues to be enforceable. 
A)  For liquidated damages to be lawful, the actual damages must be precisely determined. 
B)  Liquidated damages are enforceable even if actual damages are later determined to be different. 
C)  A liquidated damages clause is considered a penalty if actual damages are not determinable in advance. 
D)  If a liquidated damages clause is found to be a penalty, it continues to be enforceable.

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

Restitution is an action to undo a contract.

To be liable for consequential damages, the breaching party need not know nor have reason to know that the breach will cause special damages to the other party.

Which of the following is true of specific performance?

Which of the following torts arises when a third party induces a contracting party to breach the contract with another party?

The amount of compensatory damages that will be awarded for breach of contract depends on which party breached the contract.

Anticipatory repudiation occurs when one contracting party informs the other that he or she will not perform his or her contractual duties when due.

If the builder breaches a construction contract either before or during construction, the owner can recover the increased cost above the contract price that he or she has to pay to have the work completed by another contractor.

In an anticipatory breach, the nonbreaching party does not have the right to sue the breaching party until performance is due.

Which of the following terms refers to an unconditional and absolute offer by a contracting party to perform his or her obligations under a contract?

Which of the following statements is true of nominal damages?

________ refers to an equitable doctrine that permits the court to rewrite a contract to express the parties' true intentions.

To rescind a contract, the parties must make restitution of the consideration they received under the contract.

Minor breach occurs when a party renders substantial performance of his or her contractual duties.

In the event of a material breach, the nonbreaching party is discharged from further performance under the contract.

When a party commits an anticipatory breach, the nonbreaching party ________.

Poole Contractors makes a contract with Delta Resources to pay $50,000 for the supply of 500 truckloads of sand within a week. Delta Resources delivers the sand two days after the contract was made, and Poole Contractors pays it $50,000 promised in the contract. This is an instance of ________.

Intentional interference with contractual relations arises when a third party induces a contracting party to breach the contract with another party.

Strict performance by a party discharges that party's duties under the contract.

Which of the following hold true in a case of liquidated damages?

Legal Heritage and the Digital Age

Courts and Jurisdiction

Judicial, Alternative, and E-Dispute Resolution

Constitutional Law for Business and E-Commerce

Intentional Torts and Negligence

Product and Strict Liability

Intellectual Property and Cyber Piracy

Criminal Law and Cyber Crime

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

Digital 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

Warranties

Creation of Negotiable Instruments

Holder in Due Course and Transferability

Liability, Defenses, and Discharge

Banking System and Electronic Financial Transactions

Credit, Mortgages, and Debtors Rights

Secured Transactions

Bankruptcy and Reorganization

Agency Formation and Termination

Liability of Principals, Agents, and Independent Contractors

Employment, Worker Protection, and Immigration Law

Labor Law

Equal Opportunity in Employment

Small Business, Entrepreneurship, and General Partnerships

Limited Partnerships and Special Partnerships

Corporate Formation and Financing

Corporate Governance and the Sarbanes-Oxley Act

Corporate Acquisitions and Multinational Corporations

Limited Liability Companies and Limited Liability Partnerships

Franchise and Special Forms of Business

Investor Protection and E-Securities Transactions

Ethics and Social Responsibility of Business

Administrative Law and Regulatory Agencies

Consumer Protection and Product Safety

Environmental Protection

Antitrust Law and Unfair Trade Practices

Personal Property, Real Property, and Insurance

Real Property

Landlord-Tenant Law and Land Use Regulation

Insurance

Accountants Duties and Liability

Wills, Trusts, and Estates

Family Law

International and World Trade Law

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