Question 1

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

Accepted Answer

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

Question 2

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

Accepted Answer

A) True 
 B)False  False

Question 3

Handcrafts & Hobbies Store agrees to hire Iliana for one year at a salary of $600 per week.When Handcrafts & Hobbies cancels the contract,Iliana spends $150 to obtain a similar job that pays $450 per week for a year.Iliana is entitled to recover

Accepted Answer

A)  the amount of the wages that Handcrafts & Hobbies promised only.
B)  the difference between the wages at the two jobs only.
C)  the difference between the wages at the two jobs plus $150.
D)  $150 only. C

Question 4

Ordinarily,a waiver by a contracting party will not operate to waive subsequent,additional,or future breaches of contract.

Accepted Answer

A) True 
 B)False

Question 5

Ileana orally agrees to pay Jaime to plant and harvest a quarter of Ileana's farm acreage for four corn-planting seasons.After Jaime prepares the land and plants the first crop,Ileana says that their deal is off.Jaime can most likely recover

Accepted Answer

A)  in quasi contract.
B)  in reformation.
C)  in restitution.
D)  on the parties' existing contract.

Question 6

Punitive damages generally are awarded in lawsuits for breach of contract.

Accepted Answer

A) True 
 B)False

Question 7

An award of damages for a breach of contract can elevate the nonbreaching party to a better position than he or she would have been in if the contract had not been breached.

Accepted Answer

A) True 
 B)False

Question 8

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 9

Nonny agrees to buy a unique collection of Olympics memorabilia for $7,000 from Piper and sends $1,500 as a down payment.When Nonny sends Piper the rest of the price,she refuses to ship the collection.Nonny should seek

Accepted Answer

A)  damages.
B)  quasi-contractual recovery.
C)  rescission.
D)  specific performance.

Question 10

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 11

Leif contracts to sell his Micro Brewery & Pub to Naomi on April 1.On March 15,Leif tells Naomi that he will not go through with the deal.Naomi can recover

Accepted Answer

A)  the cost of any property that Naomi would find suitable.
B)  the cost of a similar,nearby brewery and pub.
C)  the Micro Brewery & Pub.
D)  nothing.

Question 12

A liquidated damages provision specifies that a certain amount is to be paid in the event of a future default or breach of contract.

Accepted Answer

A) True 
 B)False

Question 13

Fact Pattern 19-B1 (Questions B4-B5 apply)
Ambrose enters into a contract to buy 350 acres from Belle Vista Farms to cultivate grapes and open a winery.
-Refer to Fact Pattern 19-B1.If Belle Vista breaches the contract,Ambrose's remedy would most likely be

Accepted Answer

A)  a certain ratio of the amount that Ambrose expected to invest in the project.
B)  a percentage of Belle Vista's unrealized profit.
C)  the difference between the land's contract and market prices.
D)  specific performance.

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

Courts order reformation most often when fraud or mutual mistake is present.

Accepted Answer

A) True 
 B)False

Question 16

Fact Pattern 19-B1 (Questions B4-B5 apply)
Ambrose enters into a contract to buy 350 acres from Belle Vista Farms to cultivate grapes and open a winery.
-Refer to Fact Pattern 19-B1.If Ambrose breaches the contract,Belle Vista's remedy would most likely be

Accepted Answer

A)  a certain ratio of the amount that Ambrose expected to invest in the project.
B)  a percentage of Ambrose's unrealized profit.
C)  the difference between the land's contract and market prices.
D)  specific performance.

Question 17

Meatpackers,Inc.,enters into a contract with Nemiah's Ranch for the delivery of a certain number of beef cattle on a set schedule.Nemiah's delays the first delivery for five days,aware that Meatpackers loses a certain percentage of profit each day.An award to Meatpackers of consequential damages would

Accepted Answer

A)  establish,as a matter of principle,that Nemiah's acted wrongfully.
B)  provide Meatpackers with funds for a foreseeable loss beyond the contract.
C)  provide Meatpackers with funds for its loss of the bargain.
D)  punish Nemiah's and set an example to deter other suppliers from similar acts.

Question 18

Liquidated damages provisions usually are enforceable.

Accepted Answer

A) True 
 B)False

Question 19

A party seeking to recover in quasi contract must show that he or she acted as a volunteer in conferring a benefit on another party.

Accepted Answer

A) True 
 B)False

Question 20

In a contract for a sale of goods,the usual measure of compensatory damages is the difference between the contract price and the market price.

Accepted Answer

A) True 
 B)False

Exam 19: Breach of Contract and Remedies

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

Handcrafts & Hobbies Store agrees to hire Iliana for one year at a salary of $600 per week.When Handcrafts & Hobbies cancels the contract,Iliana spends $150 to obtain a similar job that pays $450 per week for a year.Iliana is entitled to recover

Ordinarily,a waiver by a contracting party will not operate to waive subsequent,additional,or future breaches of contract.

Ileana orally agrees to pay Jaime to plant and harvest a quarter of Ileana's farm acreage for four corn-planting seasons.After Jaime prepares the land and plants the first crop,Ileana says that their deal is off.Jaime can most likely recover

Punitive damages generally are awarded in lawsuits for breach of contract.

An award of damages for a breach of contract can elevate the nonbreaching party to a better position than he or she would have been in if the contract had not been breached.

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

Nonny agrees to buy a unique collection of Olympics memorabilia for $7,000 from Piper and sends $1,500 as a down payment.When Nonny sends Piper the rest of the price,she refuses to ship the collection.Nonny should seek

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

Leif contracts to sell his Micro Brewery & Pub to Naomi on April 1.On March 15,Leif tells Naomi that he will not go through with the deal.Naomi can recover

A liquidated damages provision specifies that a certain amount is to be paid in the event of a future default or breach of contract.

Fact Pattern 19-B1 (Questions B4-B5 apply) Ambrose enters into a contract to buy 350 acres from Belle Vista Farms to cultivate grapes and open a winery. -Refer to Fact Pattern 19-B1.If Belle Vista breaches the contract,Ambrose's remedy would most likely be

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

Courts order reformation most often when fraud or mutual mistake is present.

Fact Pattern 19-B1 (Questions B4-B5 apply) Ambrose enters into a contract to buy 350 acres from Belle Vista Farms to cultivate grapes and open a winery. -Refer to Fact Pattern 19-B1.If Ambrose breaches the contract,Belle Vista's remedy would most likely be

Liquidated damages provisions usually are enforceable.

A party seeking to recover in quasi contract must show that he or she acted as a volunteer in conferring a benefit on another party.

In a contract for a sale of goods,the usual measure of compensatory damages is the difference between the contract price and the market price.