Question 1

Russell and Joe make a contract for Russell to manufacture five leather chairs of a specified design.Prior to their manufacture,the factory is destroyed in an accidental fire that is no one's fault.If the chairs are available from other sources:

Accepted Answer

A) Russell must supply the chairs, even if he must buy them elsewhere. 
B) Russell's duty to deliver the chairs is discharged by the destruction of the factory. 
C) Russell has materially breached the contract if he fails to deliver the chairs. 
D) Two of the above, (a) and (c).

Question 2

Which of the following is true with respect to substantial performance?

Accepted Answer

A) It has particular importance in the construction industry. 
B) Substantial performance does not defeat the purpose of the contract. 
C) When one party to a contract has substantially performed, the other party cannot recover damages for the imperfect performance. 
D) All of the above. 
E) Two of the above, (a) and (b) are correct.

Question 3

Ashley contracted to perform on her horse,Coronation,in the opening ceremonies of the World Equestrian Games.If,before the event,Coronation pulls a tendon in its leg and Ashley has to cancel her appearance,this is a case of:

Accepted Answer

A) subjective impossibility, which does not excuse Ashley from liability for breach of contract. 
B) objective impossibility, which discharges Ashley's contractual duty. 
C) frustation of purpose, which does not discharge Ashley's contractual duty. 
D) commercial impracticability, which excuses nonperformance.

Question 4

Paul promises Marty $1,500 if he will completely landscape Paul's yard.Which of the following would discharge Paul's obligations to pay under this contract?

Accepted Answer

A) Marty leaves a one-foot strip of land barren. 
B) Marty doesn't begin work on the landscaping until after he finishes two other jobs. 
C) Marty doesn't plant any flowers or grass. 
D) Paul isn't satisfied with Marty's design.

Question 5

A person who has made a financially unsound contract may be relieved from performance under the doctrine of commercial impracticability.

Accepted Answer

A) True 
 B)False

Question 6

A novation is an agreement between two parties to have one substitute for the other in a contract.

Accepted Answer

A) True 
 B)False

Question 7

The definition of "discharge by breach" is:

Accepted Answer

A) performance that is incomplete but that does not defeat the purpose of the contract but entitles the injured party to damages. 
B) wrongful failure to perform the terms of a contract that gives rise to a right to damages by the injured party. 
C) a breach that prevents performance by either party. 
D) None of the above.

Question 8

In all substituted contracts there must be an agreement among three parties where a new promise is substituted for an existing promise or a new promisor is substituted for an existing promisor.

Accepted Answer

A) True 
 B)False

Question 9

The principle illustrated in the Christy v.Pilkinton case is:

Accepted Answer

A) a breach of contract is material if it is an intentional breach. 
B) subjective impossibility does not discharge the contractual duty of the party. 
C) objective impossibility generally discharges the contractual duty of the party. 
D) commercial impracticability occurs when performance can only be accomplished under unforeseen and unjust hardship.

Question 10

Rebecca sees a pair of beautiful silver shoes in a store window.She goes in and tells the shopkeeper,"If I am asked to the prom,I will buy those shoes.Please hold them for me." If the shopkeeper signs a note that says,"Will hold for Rebecca silver shoes,style 1028,size 8," will he have to honor that promise?

Accepted Answer

A) Yes, and there is a condition precedent to the contract of sale. 
B) Yes, there is a contract with a condition subsequent. 
C) No, there is no contract but simply an illusory promise. 
D) No, a contract is formed after Rebecca is asked to the prom.

Question 11

Belinda has a household insurance policy,which requires that she notify the insurance company within 30 days of any loss before she is eligible to receive payment for her loss.The notification requirement is a condition precedent to the insurance company's obligation to perform,even though the notification must occur subsequent to the loss.

Accepted Answer

A) True 
 B)False

Question 12

If there is a novation,the original promisor remains liable to the original promisee if the new promisor fails to perform.

Accepted Answer

A) True 
 B)False

Question 13

The "perfect tender rule" provides that only substantial deviations from the promised performance in a sales contract under the Code constitute a material breach and discharge the aggrieved party from the duty of performance.

Accepted Answer

A) True 
 B)False

Question 14

A condition subsequent is a much more frequent occurrence than a condition precedent.

Accepted Answer

A) True 
 B)False

Question 15

If the contract does not state otherwise,standard goods under a contract for sale to meet the satisfaction of the buyer must:

Accepted Answer

A) meet the buyer's actual satisfaction, if honest and in good faith, even if unreasonable. 
B) meet the buyer's actual satisfaction, only if reasonable. 
C) meet a subjective standard. 
D) satisfy a reasonable person.

Question 16

Sid contracts to put new kitchen cabinets in Ned's house.Sid repeatedly tries to install the cabinets,but Ned does not grant him access to the house.In this case:
a.Ned is discharged from his duties under the contract because of material breach.
b.the frustration of purpose doctrine applies to discharge the contract.
c.Sid is discharged from his duties under the contract because Ned's prevention of Sid's performance constitutes a material breach.
d.Both Sid and Ned are discharged from their duties because of impossibility of performance.

Accepted Answer

The answer of Sid contracts to put new kitchen cabinets...

Question 17

Carl,a contractor,has a contract with Ron,a realtor,to construct a new condominium complex.The contract provides that Carl must furnish a certificate of occupancy and conformity with the local fire code before Ron has an obligation to pay.The furnishing of the certificate is an implied-in-fact condition subsequent to the construction of the building.

Accepted Answer

A) True 
 B)False

Question 18

Wilmer and Grace have an executory contract for the sale of some goods.Wilmer files for bankruptcy and is then discharged by the bankruptcy court.Wilmer has no obligation to perform under the contract with Grace.

Accepted Answer

A) True 
 B)False

Question 19

The Code greatly alters the common law doctrine of material breach by adopting what is known as the:

Accepted Answer

A) perfect tender rule. 
B) anticipatory repudiation rule. 
C) prevention of performance rule. 
D) discharge by operation of law rule.

Question 20

Which of the following would be considered a material breach of a contract?

Accepted Answer

A) Partial performance that omits some essential part of the contract. 
B) Delivery of 50 chairs in a contract that calls for 100 chairs. 
C) An intentional breach of the contract. 
D) All of the above would be material breaches. 
E) Only (a) and (b) above would be material breaches.

Exam 17: Performance, Breach, and Discharge

Russell and Joe make a contract for Russell to manufacture five leather chairs of a specified design.Prior to their manufacture,the factory is destroyed in an accidental fire that is no one's fault.If the chairs are available from other sources:

Which of the following is true with respect to substantial performance?

Ashley contracted to perform on her horse,Coronation,in the opening ceremonies of the World Equestrian Games.If,before the event,Coronation pulls a tendon in its leg and Ashley has to cancel her appearance,this is a case of:

Paul promises Marty $1,500 if he will completely landscape Paul's yard.Which of the following would discharge Paul's obligations to pay under this contract?

A person who has made a financially unsound contract may be relieved from performance under the doctrine of commercial impracticability.

A novation is an agreement between two parties to have one substitute for the other in a contract.

The definition of "discharge by breach" is:

In all substituted contracts there must be an agreement among three parties where a new promise is substituted for an existing promise or a new promisor is substituted for an existing promisor.

The principle illustrated in the Christy v.Pilkinton case is:

If there is a novation,the original promisor remains liable to the original promisee if the new promisor fails to perform.

The "perfect tender rule" provides that only substantial deviations from the promised performance in a sales contract under the Code constitute a material breach and discharge the aggrieved party from the duty of performance.

A condition subsequent is a much more frequent occurrence than a condition precedent.

If the contract does not state otherwise,standard goods under a contract for sale to meet the satisfaction of the buyer must:

Wilmer and Grace have an executory contract for the sale of some goods.Wilmer files for bankruptcy and is then discharged by the bankruptcy court.Wilmer has no obligation to perform under the contract with Grace.

The Code greatly alters the common law doctrine of material breach by adopting what is known as the:

Which of the following would be considered a material breach of a contract?