Question 1

The "American rule" states that the losing party in a lawsuit is responsible for all attorney fees.

Accepted Answer

A) True 
 B)False

Question 2

When the plaintiff seeks the remedy of specific performance, the plaintiff wants the other party to carry out the terms of the contract and not pay damages.

Accepted Answer

A) True 
 B)False

Question 3

If one party to a contract breaks the contract, the other party generally is under a duty to stop any further performance to avoid sustaining greater damages.

Accepted Answer

A) True 
 B)False

Question 4

If an exculpatory clause limits liability for damages caused by negligent conduct, the tortfeasor's liability is:

Accepted Answer

A) ​contributorily negligent. 
B) not limited if the conduct is willful. 
C) ​limited unless the plaintiff signed a release. 
D) ​limited if the conduct is grossly negligent. 
A) ​contributorily negligent. 
B) not limited if the conduct is willful. 
C) ​limited unless the plaintiff signed a release. 
D) ​limited if the conduct is grossly negligent.

Question 5

The rule of mitigation of damages requires that a party injured by a breach of contract must:

Accepted Answer

A) ​take any and all steps possible to reduce the damages that will be sustained because of the breach. 
B) discharge the contract before filing suit for breach. 
C) ​hire someone else to perform the contract. 
D) ​take reasonable steps to reduce the damages that would otherwise be sustained because of the breach. 
A) ​take any and all steps possible to reduce the damages that will be sustained because of the breach. 
B) discharge the contract before filing suit for breach. 
C) ​hire someone else to perform the contract. 
D) ​take reasonable steps to reduce the damages that would otherwise be sustained because of the breach.

Question 6

A landlord who continuously accepts late rental payments without collecting the late fee provided in the lease:

Accepted Answer

A) ​waives the late fee. 
B) will collect the late fee at a later date. 
C) ​is ignorant of the late fee. 
D) ​allows the tenant to repudiate the lease. 
A) ​waives the late fee. 
B) will collect the late fee at a later date. 
C) ​is ignorant of the late fee. 
D) ​allows the tenant to repudiate the lease.

Question 7

When an anticipatory repudiation of a contract occurs, the non-breaching party may do any of the following except:

Accepted Answer

A) ​do nothing and wait for performance per the contract. 
B) immediately declare a breach of contract. 
C) ​consider the repudiation as an offer to cancel the contract. 
D) ​immediately seek an injunction. 
A) ​do nothing and wait for performance per the contract. 
B) immediately declare a breach of contract. 
C) ​consider the repudiation as an offer to cancel the contract. 
D) ​immediately seek an injunction.

Question 8

Only direct losses from a breach of contract may be recovered by an injured party.

Accepted Answer

A) True 
 B)False

Question 9

When a party fails to perform in the manner called for in the contract, a breach occurs.

Accepted Answer

A) True 
 B)False

Question 10

If monetary damages would be an adequate remedy, then an action for specific performance is not appropriate.

Accepted Answer

A) True 
 B)False

Question 11

In some cases the court may require specific performance, whereby the court will order the contractual performance to be carried out.

Accepted Answer

A) True 
 B)False

Question 12

A firm request for additional payment under an existing contract without refusal to perform until the additional payment is made is considered a repudiation of a contract.

Accepted Answer

A) True 
 B)False

Question 13

When a party expressly declares before the time for performance arrives that the contract will not be performed, such a declaration is called an anticipatory repudiation.

Accepted Answer

A) True 
 B)False

Question 14

When one party commits a non-material breach of contract, the other party may rescind the contract.

Accepted Answer

A) True 
 B)False

Question 15

When the contract requires that both parties submit disputes to arbitration, this is an example of a limitation-of-remedies clause.

Accepted Answer

A) True 
 B)False

Question 16

A provision stipulating the amount of money damages to be paid in the event of default or breach of contract is known as a __________ damages clause.

Accepted Answer

A) ​nominal 
B) contract 
C) ​liquidated 
D) ​breach 
A) ​nominal 
B) contract 
C) ​liquidated 
D) ​breach

Question 17

A waiver of a breach may be either express or implied.

Accepted Answer

A) True 
 B)False

Question 18

An injured party that does not suffer an actual loss from the breach of a contract is entitled to consequential damages.

Accepted Answer

A) True 
 B)False

Exam 19: Breach of Contract and Remedies

The "American rule" states that the losing party in a lawsuit is responsible for all attorney fees.

When the plaintiff seeks the remedy of specific performance, the plaintiff wants the other party to carry out the terms of the contract and not pay damages.

If one party to a contract breaks the contract, the other party generally is under a duty to stop any further performance to avoid sustaining greater damages.

If an exculpatory clause limits liability for damages caused by negligent conduct, the tortfeasor's liability is:

The rule of mitigation of damages requires that a party injured by a breach of contract must:

A landlord who continuously accepts late rental payments without collecting the late fee provided in the lease:

When an anticipatory repudiation of a contract occurs, the non-breaching party may do any of the following except:

Only direct losses from a breach of contract may be recovered by an injured party.

When a party fails to perform in the manner called for in the contract, a breach occurs.

If monetary damages would be an adequate remedy, then an action for specific performance is not appropriate.

In some cases the court may require specific performance, whereby the court will order the contractual performance to be carried out.

A firm request for additional payment under an existing contract without refusal to perform until the additional payment is made is considered a repudiation of a contract.

When a party expressly declares before the time for performance arrives that the contract will not be performed, such a declaration is called an anticipatory repudiation.

When one party commits a non-material breach of contract, the other party may rescind the contract.

When the contract requires that both parties submit disputes to arbitration, this is an example of a limitation-of-remedies clause.

A provision stipulating the amount of money damages to be paid in the event of default or breach of contract is known as a __________ damages clause.

A waiver of a breach may be either express or implied.

An injured party that does not suffer an actual loss from the breach of a contract is entitled to consequential damages.

The Nature and Sources of Law

The Court System and Dispute Resolution

Business Ethics, Social Forces, and the Law

The Constitution As the Foundation of the Legal Environment

Government Regulation of Competition and Prices

Administrative Agencies

Crimes

Torts

Intellectual Property Rights and the Internet

The Legal Environment of International Trade

Nature and Classes of Contracts: Contracting on the Internet

Formation of Contracts: Offer and Acceptance

Capacity and Genuine Assent

Consideration

Legality and Public Policy

Writing, Electronic Forms, and Interpretation of Contracts

Third Persons and Contracts

Discharge of Contracts

Personal Property and Bailments

Legal Aspects of Supply Chain Management

Nature and Form of Sales

Title and Risk of Loss

Product Liability: Warranties and Torts

Obligations and Performance

Remedies for Breach of Sales Contracts

Kinds of Negotiable Instruments and Negotiability

Transfers of Negotiable Instruments and Warranties of Parties

Liability of the Parties Under Negotiable Instruments

Checks and Funds Transfers

Nature of the Debtor-Creditor Relationship

Consumer Protection

Secured Transactions in Personal Property

Bankruptcy

Insurance

Agency

Third Persons in Agency

Regulation of Employment

Equal Employment Opportunity Law

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