Question 1

A novation requires

Accepted Answer

A)  the existence of a previous, valid obligation. 
B)  consideration greater than $5,000. 
C)  performance of the original contract by all of the parties. 
D)  an accord and satisfaction.

Question 2

Any contract can be discharged by agreement of the parties.

Accepted Answer

A) True 
 B)False

Question 3

If a condition to a lease for university housing that the tenant must be a student is not satisfied, the landlord's obligations under the lease are discharged.

Accepted Answer

A) True 
 B)False

Question 4

Debt Collection Service enters into a contract to employ Emma as a billing manager for two years. During the first year, Emma is often absent without explanation and when present fails to adequately do her job. This

Accepted Answer

A)  discharges the employer from the contract. 
B)  has no effect on the employer's performance. 
C)  changes the employer's duties under the contract. 
D)  suspends the employer's duty to perform.

Question 5

Architects LLC enters into a contract with Barns & Silos Inc. to provide designs for a certain number of farm buildings. Architects provides fewer than half of the designs by the time specified in the contract because the firm is busy with other projects. Architects' performance is most likely

Accepted Answer

A)  a material breach. 
B)  a minor breach. 
C)  a reasonable breach. 
D)  no breach.

Question 6

City Delivery, Inc., enters into a contract to deliver furniture to Damien's house with payment due on July 4. On July 4, Damien's bank is closed, and for this reason, he claims that he cannot pay on time. In this situation

Accepted Answer

A)  the bank is liable for breach. 
B)  Damien is in breach. 
C)  the contract is discharged. 
D)  the contract is suspended.

Question 7

Lana agrees to work as Michelle's personal assistant for one year but dies in the ninth month of the contract. Lana's death

Accepted Answer

A)  discharges the contract. 
B)  breaches the contract. 
C)  requires Lana's estate to pay damages. 
D)  suspends performance of the contract.

Question 8

Anticipatory repudiation discharges a contract.

Accepted Answer

A) True 
 B)False

Question 9

The most common way to terminate contractual duties is by

Accepted Answer

A)  agreement. 
B)  repudiation. 
C)  failure of a condition. 
D)  performance.

Question 10

A party who in good faith performs substantially all of the terms of a contract can enforce the contract against the other party.

Accepted Answer

A) True 
 B)False

Question 11

Bottling Company enters into a contract with Chug's Brewery to provide certain bottling and delivery services. Before Bottling starts to work, the market price rises for the fuel for glass ovens. Bottling tells Chug's that due to the added cost it will not perform their deal. Bottling's contractual obligation to Chug's is

Accepted Answer

A)  breached. 
B)  discharged. 
C)  rescinded. 
D)  suspended.

Question 12

Performance becomes commercially impracticable when a foreseeable, added burden of performing increases the cost slightly.

Accepted Answer

A) True 
 B)False

Question 13

Any breach of contract allows the breaching party to negotiate to receive additional benefits in order to remedy the breach.

Accepted Answer

A) True 
 B)False

Question 14

Performance can be accomplished by tender.

Accepted Answer

A) True 
 B)False

Question 15

A novation requires the contracting parties to make restitution of whatever they received under the contract.

Accepted Answer

A) True 
 B)False

Question 16

Under a construction contract that requires a builder to meet certain specifications, complete performance is required to avoid material breach.

Accepted Answer

A) True 
 B)False

Question 17

When a party's performance is perfect, it is complete.

Accepted Answer

A) True 
 B)False

Question 18

When an anticipatory repudiation occurs, it is treated as a material breach of a contract.

Accepted Answer

A) True 
 B)False

Question 19

Iggy and Jon sign a contract by which Iggy agrees to deliver and install a gas fireplace on October 15 in exchange for Jon's promise to pay the $500 price within ten days of the install date. The delivery and installation of the fireplace and the payment of the price are examples of

Accepted Answer

A)  conditions precedent. 
B)  concurrent conditions. 
C)  conditions subsequent. 
D)  implied conditions.

Question 20

Range Free Farms enters into a contract to sell Sara's Market a truckload of eggs. Range Free fails to deliver. Sara's Market

Accepted Answer

A)  must pay for the eggs to avoid a breach of contract. 
B)  does not have to pay for the eggs because Range Free did not perform. 
C)  must pay for the eggs, but can sue Range Free for breach of contract. 
D)  does not have to pay for the eggs, but then cannot sue Range Free.

Exam 16: Performance and Discharge

A novation requires

Any contract can be discharged by agreement of the parties.

If a condition to a lease for university housing that the tenant must be a student is not satisfied, the landlord's obligations under the lease are discharged.

Debt Collection Service enters into a contract to employ Emma as a billing manager for two years. During the first year, Emma is often absent without explanation and when present fails to adequately do her job. This

Architects LLC enters into a contract with Barns & Silos Inc. to provide designs for a certain number of farm buildings. Architects provides fewer than half of the designs by the time specified in the contract because the firm is busy with other projects. Architects' performance is most likely

City Delivery, Inc., enters into a contract to deliver furniture to Damien's house with payment due on July 4. On July 4, Damien's bank is closed, and for this reason, he claims that he cannot pay on time. In this situation

Lana agrees to work as Michelle's personal assistant for one year but dies in the ninth month of the contract. Lana's death

Anticipatory repudiation discharges a contract.

The most common way to terminate contractual duties is by

A party who in good faith performs substantially all of the terms of a contract can enforce the contract against the other party.

Performance becomes commercially impracticable when a foreseeable, added burden of performing increases the cost slightly.

Any breach of contract allows the breaching party to negotiate to receive additional benefits in order to remedy the breach.

Performance can be accomplished by tender.

A novation requires the contracting parties to make restitution of whatever they received under the contract.

Under a construction contract that requires a builder to meet certain specifications, complete performance is required to avoid material breach.

When a party's performance is perfect, it is complete.

When an anticipatory repudiation occurs, it is treated as a material breach of a contract.

Iggy and Jon sign a contract by which Iggy agrees to deliver and install a gas fireplace on October 15 in exchange for Jon's promise to pay the $500 price within ten days of the install date. The delivery and installation of the fireplace and the payment of the price are examples of

Range Free Farms enters into a contract to sell Sara's Market a truckload of eggs. Range Free fails to deliver. Sara's Market