Exam 9: The End of the Contractual Relationship

"In contract law, warranty is a promise by the manufacturer of a product to be responsible to make repairs on that product, if it's defective." Discuss the accuracy of this statement.

Where a contract is discharged or modified by a unilateral discharge, explain the problem that arises and its solution.

A condition precedent is a term of a contract that will bring that contract to an end when the specified condition is met.

Smedlap, a trucker, and Dewdney, a farmer, entered into a contract under which Smedlap agreed to haul all of Dewdney's pumpkin crop to market in time for the Halloween sales. However, the day before Smedlap was to pick up the pumpkins, he called Dewdney and told him that, since he had received such a good offer to sell his truck, he had sold it and therefore was not able to haul Dewdney's pumpkins. There was not enough time for Smedlap to buy another truck, but he was sure that Dewdney could make other arrangements and he hoped that he hadn't unduly inconvenienced him. Unfortunately, Dewdney was not able to make arrangements in time for the Halloween market, and instead he had to sell his crop to a pie-filling canner for much less than he could reasonably have expected at the market. Furthermore, the market owners were so disappointed by Dewdney's failure to deliver that they refused to give him their usual order for Christmas turkeys. In previous years, this turkey order had generated his major income for the year. He was forced to find another outlet for his turkeys, and again he ended up selling to commercial processors for a substantially lower price. As a result of these two events, Dewdney was unable to keep up his mortgage payments on the farm and eventually he lost it to the bank in a foreclosure action. Dewdney is now suing Smedlap to recover these losses. Identify the correct statement with respect to the question of whether Smedlap's conduct was a breach of contract.

Which of the following is true with regard to remedies for breach of contract?

The creation of a new contract through the substitution of a third party for one of the original parties to a contract, with consent by all, is known as ________.

Which of the following is true with regard to ending a contract by agreement?

Mikael recently started a home-based business selling custom fishing lures. He decided that he could make a lot more money selling his homemade lures on the Internet. Mikael is not the least bit technologically-inclined, but he knows that his next-door neighbour, Perm, does web design on the side. He decides to hire her to create a website for his new venture. Perm has him sign an agreement that includes an exemption clause that limits her liability in cases of negligence. In the course of designing the website, Perm becomes annoyed at Mikael because his dog keeps digging up her rose bushes. Rather than confront Mikael directly, Perm deliberately puts the wrong pricing information on Mikael's website to get him back. If Mikael suffers damages as a result and wants to sue Perm, what would the likely result be?

An injunction involves a court order to do something (to perform the contract), whereas specific performance usually involves an order to refrain from some offensive conduct.

The victim of a breach cannot recover damages that he could have avoided if he had made a reasonable effort.

Which one of the following is False with regard to exemption (exclusion) clauses?

If neighbours have a contract agreeing not to erect a building that blocks the other's view, which remedy might the court impose if that agreement is breached?

Joe agreed to sell Sam his model-T Ford automobile. The day before delivery, he took it out for one last drive. Through his own fault, he got into a collision in which the car was destroyed. Because it was impossible to go through with the terms of the contract, he claimed that it was frustrated. Discuss the legal position of the parties.

When a contract anticipates some catastrophic event, such as a riot, invasion, earthquake, or flood that will interfere with the performance of the contract, this is referred to as a

The claim of frustration is not available in which of the following circumstances?

Gill, a wholesale fish seller, agreed to provide Blanchet's Restaurant with 1000 pounds of fresh salmon per week throughout the months of July, August, and September. Things went as planned for July and August. However, Gill was unable to meet the requirements of the contract for the first two weeks of September because his boats simply did not catch that much, although other companies did better and other fish was available for Gill to purchase, but at a higher price than what Blanchet was paying him. Rather than sell at a loss, Gill simply did not supply during the two-week period. At the end of that period, the Federal Fisheries Department shut down the fishery altogether because of the depletion of fish. After that, no more fresh salmon was available at all. Blanchet sued Gill for breach of contract with respect to his failure to deliver any fresh salmon in September. Which one of the following statements accurately sets out the legal situation here?

A breach of warranty will bring the contract to an end.

What is the three-part test for determining if novation has occurred?

Which of the following is False with regard to ending contracts and remedies?

Victims of breach have a duty to mitigate damages, meaning they must do what they can to keep those damages as low as possible.