Question 1

Explain the notion of continuous expectation of performance.

Accepted Answer

The courts have held that a contract exi

Question 2

In situations where an exemption clause appears too be so broad as to shield the wrongdoer from liability,

Accepted Answer

A)  the courts have determined that the clause is effective to protect the wrongdoer. 
B)  the courts have declared that the exemption clause amounts to an anticipatory breach of the contract. 
C)  the courts have declared the exemption clause to be void. 
D)  the courts have characterized the breach as a fundamental breach and have argued that the exemption clause does not cover a fundamental breach. 
E)  the courts have declared that the exemption clause is too broad and thus not part of the contract. 
A)  the courts have determined that the clause is effective to protect the wrongdoer. 
B)  the courts have declared that the exemption clause amounts to an anticipatory breach of the contract. 
C)  the courts have declared the exemption clause to be void. 
D)  the courts have characterized the breach as a fundamental breach and have argued that the exemption clause does not cover a fundamental breach. 
E)  the courts have declared that the exemption clause is too broad and thus not part of the contract.

Question 3

Exemption clauses are generally strictly construed against the party that is not seeking to rely on them.

Accepted Answer

A) True 
 B)False

Question 4

A warranty is

Accepted Answer

A)  a guarantee contained in a contract regarding the performance of an obligation. 
B)  an essential term of a contract that guarantees the performance of an obligation. 
C)  a guarantee of performance given by one party to another. 
D)  a non- essential term of a contract. 
E)  a non- essential term of a contract that guarantees the performance of an obligation. 
A)  a guarantee contained in a contract regarding the performance of an obligation. 
B)  an essential term of a contract that guarantees the performance of an obligation. 
C)  a guarantee of performance given by one party to another. 
D)  a non- essential term of a contract. 
E)  a non- essential term of a contract that guarantees the performance of an obligation.

Question 5

What is an anticipatory breach?

Accepted Answer

A breach that occurs

Question 6

A minor beach is

Accepted Answer

A)  a breach of a minor obligation of the promisee. 
B)  a breach of a minor obligation of the promisor. 
C)  an insignificant breach by the defendant that is ignored by the plaintiff. 
D)  a breach that is so insignificant the courts will not interfere when there is a breach. 
E)  a breach of a non- essential term of the contract or of an essential term in a minor respect. 
A)  a breach of a minor obligation of the promisee. 
B)  a breach of a minor obligation of the promisor. 
C)  an insignificant breach by the defendant that is ignored by the plaintiff. 
D)  a breach that is so insignificant the courts will not interfere when there is a breach. 
E)  a breach of a non- essential term of the contract or of an essential term in a minor respect.

Question 7

Jack agrees to paint the home of Jim. During the negotiations Jim leads Jack to believe that he is in some financial predicament and so cannot pay the full fee. Jack agrees to give him a discount because of his predicament. A few days before Jack is due to perform he learns from a source that Jim is a very wealthy man. Jack decides that because he has been tricked he will not honour his obligation to paint the home. He gives away all his tools and equipment and tells Jim that he cannot paint the home because his tools have been stolen. Jack's conduct is

Accepted Answer

A)  a breach of contract because Jack's conduct renders performance impossible. 
B)  a breach of contract by implied repudiation. 
C)  not a breach of contract. 
D)  a breach of contract by express repudiation. 
E)  a breach of a condition. 
A)  a breach of contract because Jack's conduct renders performance impossible. 
B)  a breach of contract by implied repudiation. 
C)  not a breach of contract. 
D)  a breach of contract by express repudiation. 
E)  a breach of a condition.

Question 8

A breach of a minor term will not discharge a contract, but a major major term that is broken in only a minor respect will discharge a contract.

Accepted Answer

A) True 
 B)False

Question 9

A breach will discharge a contract if

Accepted Answer

A)  the breach is of the whole contract or an essential part of the contract. 
B)  the innocent party suffers significant financial loss. 
C)  the breach causes injury to the innocent party. 
D)  the breaching party decides to abandon its obligations under the contract as a result of the breach. 
E)  the injured party elects to treat it as discharging the contract. 
A)  the breach is of the whole contract or an essential part of the contract. 
B)  the innocent party suffers significant financial loss. 
C)  the breach causes injury to the innocent party. 
D)  the breaching party decides to abandon its obligations under the contract as a result of the breach. 
E)  the injured party elects to treat it as discharging the contract.

Question 10

Jack purchases a train ticket Toronto. During the journey there is small fire and his luggage is destroyed. Jack approaches the owners of the train and requests some compensation for his loss. He is told that the company is not liable for such losses. The public relations person to whom Jack speaks draws Jack's attention to an exemption clause behind Jack's ticket. Which of the following is true about the effect of the exemption clause?

Accepted Answer

A)  A court will say that the exemption clause is only effective if Jack was provided adequate notice of the clause. 
B)  A court will say that Jack signed the contract and so the clause is effective to bind him. 
C)  The court will impose punitive damages on the corporation to punish it for its unfair attempt to limit liability. 
D)  The exemption clause is not part of the contract between Jack and the corporation and so it is ineffective. 
E)  A court will say that the exemption clause is too broad and so is ineffective. 
A)  A court will say that the exemption clause is only effective if Jack was provided adequate notice of the clause. 
B)  A court will say that Jack signed the contract and so the clause is effective to bind him. 
C)  The court will impose punitive damages on the corporation to punish it for its unfair attempt to limit liability. 
D)  The exemption clause is not part of the contract between Jack and the corporation and so it is ineffective. 
E)  A court will say that the exemption clause is too broad and so is ineffective.

Question 11

Damages are not available for an anticipatory breach because the time for performance has not arrived.

Accepted Answer

A) True 
 B)False

Question 12

Michael's Shop has a standard form contract that includes an exemption clause. What must Michael do to ensure that the use of the exemption clause is accepted by a court as proper?

Accepted Answer

A)  Michael must enter into a collateral agreement with any person regarding the clause. 
B)  Michael must not use the exemption clause. . 
C)  Michael must modify the clause. 
D)  Michael must bring the exemption clause to the attention of any person with whom he seeks to enter into a contract. 
E)  Michael must notify the court of his use of the exemption clause before he enters into the contract. 
A)  Michael must enter into a collateral agreement with any person regarding the clause. 
B)  Michael must not use the exemption clause. . 
C)  Michael must modify the clause. 
D)  Michael must bring the exemption clause to the attention of any person with whom he seeks to enter into a contract. 
E)  Michael must notify the court of his use of the exemption clause before he enters into the contract.

Question 13

Jack as a contract to deliver goods to Jim on June 2, 2003. On the morning of June 2, 2003, Jack tells Jim that he will not be able to deliver the goods as promised. This is

Accepted Answer

A)  a warranty. 
B)  an express repudiation of the contract. 
C)  a minor breach. 
D)  an implied repudiation. 
E)  a rescission of the contract. 
A)  a warranty. 
B)  an express repudiation of the contract. 
C)  a minor breach. 
D)  an implied repudiation. 
E)  a rescission of the contract.

Question 14

If one party breaches a condition of a contract, the other party will generally be entitled to repudiate the contract.

Accepted Answer

A) True 
 B)False

Question 15

A breach of contract may be criminal

Accepted Answer

A)  when a party breaks a contract with the knowledge that the action will endanger human life. 
B)  when the contract between the parties is a criminal conspiracy or agreement to commit a crime. 
C)  when the promisor commits a criminal offence that is related to the contract. 
D)  when the parties to a contract enter into an agreement with a known criminal. 
E)  when the promisee commits a criminal offence that is connected to a contract. 
A)  when a party breaks a contract with the knowledge that the action will endanger human life. 
B)  when the contract between the parties is a criminal conspiracy or agreement to commit a crime. 
C)  when the promisor commits a criminal offence that is related to the contract. 
D)  when the parties to a contract enter into an agreement with a known criminal. 
E)  when the promisee commits a criminal offence that is connected to a contract.

Question 16

The effect of the doctrine of substantial performance is that

Accepted Answer

A)  where there is substantial performance a court will not entertain a suit for damages for breach of contract. 
B)  the promisor who has substantially performed a contract is entitled to damages. 
C)  where there is substantial performance, a court will entertain a suit for damages for breach of contract. 
D)  a promisee cannot seize upon a trivial failure of performance to avoid his or her obligations under a contract. 
E)  the promisee who has substantially performed a contract is entitled to damages. 
A)  where there is substantial performance a court will not entertain a suit for damages for breach of contract. 
B)  the promisor who has substantially performed a contract is entitled to damages. 
C)  where there is substantial performance, a court will entertain a suit for damages for breach of contract. 
D)  a promisee cannot seize upon a trivial failure of performance to avoid his or her obligations under a contract. 
E)  the promisee who has substantially performed a contract is entitled to damages.

Question 17

Which of the following is not true?

Accepted Answer

A)  A breach of contract may be criminal when it is done with the knowledge that the action will cause mental distress to the other party. 
B)  A breach of contract may be criminal when it is done with the knowledge that the action will expose valuable property to damage. 
C)  A breach of contract may be criminal when it is done with the knowledge that the action endanger human life. 
D)  A breach of contract may be criminal when it is done with the knowledge that the action will deprive inhabitants of their supply of gas and power. 
E)  A breach of contract may be criminal when it is done with the knowledge that the action will cause bodily harm. 
A)  A breach of contract may be criminal when it is done with the knowledge that the action will cause mental distress to the other party. 
B)  A breach of contract may be criminal when it is done with the knowledge that the action will expose valuable property to damage. 
C)  A breach of contract may be criminal when it is done with the knowledge that the action endanger human life. 
D)  A breach of contract may be criminal when it is done with the knowledge that the action will deprive inhabitants of their supply of gas and power. 
E)  A breach of contract may be criminal when it is done with the knowledge that the action will cause bodily harm.

Question 18

Michael's Shop has a standard from contract that includes an exemption clause. Michael enters into an agreement with Jill. Jill signs the agreement without reading it because she says she trusts Michael. When Michael fails to perform his part of the agreement, Jill tries to sue. The court in considering the effect of the exemption clause, will most likely

Accepted Answer

A)  require that experts provide it with a report on the effect of the clause. 
B)  apply the clause. 
C)  refuse to apply the court. 
D)  strictly construe the clause against Michael. 
E)  seek the opinion of Jill on how the clause will affect her. 
A)  require that experts provide it with a report on the effect of the clause. 
B)  apply the clause. 
C)  refuse to apply the court. 
D)  strictly construe the clause against Michael. 
E)  seek the opinion of Jill on how the clause will affect her.

Question 19

Which of the following is not true?

Accepted Answer

A)  If a breach is of a fundamental term, the party not in breach is still bound but the party committing the breach may elect to discharge the contract. 
B)  A major term may be broken in only a minor respect. 
C)  If a breach is of a minor term, the contract is still binding on both parties. 
D)  Not every breach may distract a contract. 
E)  A party to a contract may breach it by acting in a way that makes performance impossible. 
A)  If a breach is of a fundamental term, the party not in breach is still bound but the party committing the breach may elect to discharge the contract. 
B)  A major term may be broken in only a minor respect. 
C)  If a breach is of a minor term, the contract is still binding on both parties. 
D)  Not every breach may distract a contract. 
E)  A party to a contract may breach it by acting in a way that makes performance impossible.

Question 20

Which of the following is not a reason why exemption clauses are attractive?

Accepted Answer

A)  They enable a supplier of goods and services to keep its prices low because there is no need to increase prices to cope with risk. 
B)  If the supplier is sued for damages. it can completely disclaim liability. 
C)  The supplier is able to enter into a contract with a third party. 
D)  If the supplier uses a standard form contract it will have an advantage over the other party because it can prepare the form to suit itself. 
E)  all of the above 
A)  They enable a supplier of goods and services to keep its prices low because there is no need to increase prices to cope with risk. 
B)  If the supplier is sued for damages. it can completely disclaim liability. 
C)  The supplier is able to enter into a contract with a third party. 
D)  If the supplier uses a standard form contract it will have an advantage over the other party because it can prepare the form to suit itself. 
E)  all of the above

Exam 14: The Effect of Breach

Explain the notion of continuous expectation of performance.

In situations where an exemption clause appears too be so broad as to shield the wrongdoer from liability,

Exemption clauses are generally strictly construed against the party that is not seeking to rely on them.

A warranty is

What is an anticipatory breach?

A minor beach is

A breach of a minor term will not discharge a contract, but a major major term that is broken in only a minor respect will discharge a contract.

A breach will discharge a contract if

Damages are not available for an anticipatory breach because the time for performance has not arrived.

Michael's Shop has a standard form contract that includes an exemption clause. What must Michael do to ensure that the use of the exemption clause is accepted by a court as proper?

Jack as a contract to deliver goods to Jim on June 2, 2003. On the morning of June 2, 2003, Jack tells Jim that he will not be able to deliver the goods as promised. This is

If one party breaches a condition of a contract, the other party will generally be entitled to repudiate the contract.

A breach of contract may be criminal

The effect of the doctrine of substantial performance is that

Which of the following is not true?

Which of the following is not true?

Which of the following is not a reason why exemption clauses are attractive?

Law and Society

The Machinery of Justice

The Law of Torts

Professional Liability

Formation of a Contract: Offer and Acceptance

Formation of a Contract: Consideration, and Intention to Create Legal Relations

Formation of a Contract: Capacity to Contract and Legality of Object

Grounds Upon Which a Contract May Be Impeached: Mistake

Grounds Upon Which a Contract May Be Impeached: Misrepresentation, Undue Influence, and Duress

The Requirement of Writing

The Interpretation of Contracts

Privity of Contract and the Assignment of Contractual Rights

The Discharge of Contracts

Remedies for Breach

Sale of Goods

Leasing and Bailment

Insurance and Guarantee

Agency and Franchising

The Contract of Employment

Negotiable Instruments

Intellectual Property

Interests in Land and Their Transfer

Landlord and Tenant

Mortgages of Land and Real Estate Transactions

Sole Proprietorships and Partnerships

The Nature of a Corporation and Its Formation

The Internal Affairs of Corporations

The External Responsibilities of a Corporation

Secured Transactions

Creditors Rights

Government Regulation of Business

International Business Transactions

Electronic Commerce

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