Exam 7: Contract Performance: Conditions, Breach, and Remedies

Max has contracted with Lew to have his house painted.The contract specifically stated that the job was to be completed by 8/25.Lew completes the job on 8/26.Max has suffered no loss due to the delay.The job was otherwise done exactly to all contract requirements and specifications.If Max sues Lew for breach of contract due to the missed completion date,were the courts to award damages,what type of damages would most likely be awarded?

Damages agreed to when the contract is written and prior to any actual breach are called ________ damages.

Unless a contract for services calls for unique personal services,that contract cannot be discharged by impossibility.

Incidental beneficiaries are known about when the contract is entered into.

Compensatory damages cover a broad spectrum of losses for recovery of ________ damages suffered by the nonbreaching party.

You are an accounting major at your school.Your goal is to go to grad school to obtain further education and the appropriate credits necessary to become a Certified Public Accountant.Your goals are well known to your faculty and administration and it is also well known that your parents and grandparents are CPAs as well as your older brothers and sisters.As you enter your junior year,after paying your tuition and room and board fees in full,your school loses its regional accreditation making any degree issued by the school essentially worthless.A worthless degree will not be recognized by grad schools and will not be recognized by state accounting boards.When you demand a refund the school refuses claiming that they will still provide classes and knowledge.Do you have grounds to have the contract terminated and receive a refund?

You are taking a course with an adjunct professor who is teaching under a one course contract.With six weeks to go in the course,she is offered a tenure track position at another school.They require her to start within a week.When she approaches the administration,what options are available,if any,regarding the adjunct contract and her desire to leave early?

Patios R Us contracts with Karl's Concrete to have 35 yards of concrete delivered to a job site they are working on.Payment is to be made 30 days after delivery.Five days after the concrete is delivered,Patios R Us files for bankruptcy and the filing is accepted by the court.Karl's cannot sue to enforce the contract and receive payment.

Nominal damages are rarely awarded in contract cases.

Harry sees an AK-47 automatic assault rifle in a gun shop window.He inquires about the price and is told that it is $2,500.Harry signs a contract promising to pay the $2,500 on Friday,taking possession of the rifle when payment is made.On Thursday,a law is enacted making the ownership,sale or possession of an automatic rifle illegal.This contract:

How do compensatory damages and consequential damages differ?

Harry enters into a contract with Sally in which she was to pay $50,000 for Harry's hunting cabin.All negotiations,witnessed by various third parties,stated the $50,000 figure as the sales price.When the contract was written,a typographical error was made indicating a price of $5,000.At settlement,Sally tendered $5,000 and demanded the deed per the written contract.Must Harry sell the cabin for $5,000?

The Chicago Cubs major league baseball team is in the playoffs and doing well.Behind the left field wall there is an apartment building and the owner advertises,"Space available on the apartment building roof with a clear view of the field available for the World Series.Bring a lawn chair,your radio and a cooler and enjoy the game.Just $50.00 per game." Bart,a lifelong fan,answers the ad and pays the building owner $100.00 to reserve space for the first two games.Unfortunately the Cubs start playing poorly and don't make it to the World Series.

Robert and Philip are the named beneficiaries under Alan's insurance policy.Robert and Philip would specifically be considered to be ________ beneficiaries.

What is an anticipatory repudiation and what must be shown for it to be enforced?

Beth has just signed a contract to work for a bank.A clause in the contract says that before she begins work,she must pass a drug test and that should drug use be discovered,the contract becomes void.This clause would be a:

Liquidated damages must be directly related to the breach of contract they are compensating the nonbreaching party for.

Alan has accepted a new job.Which of the following is not a contract condition related to that job?

Fred's Flooring (FF)contracts with Harry homeowner to install wood flooring throughout Harry's home.Harry was to purchase the flooring and the contract was solely for installation.Payment was to be 20% at the time that the work commenced and 80% once the flooring was installed.Harry purchased the flooring materials and paid the 20%,so FF began work.When FF was half way completed,Harry realized that he didn't have the money to pay FF upon completion so he bolted the doors and refused access.If FF wants to rescind the contract and be paid for work completed,FF would sue for:

When the parties perform their obligations in good faith in order to complete the contract,this completion is called _______.