Question 1

Ordinarily,the remedy for a seller's breach of a contract for a sale of real estate is damages.

Accepted Answer

A) True 
 B)False

Question 2

Restitution involves one party's recapture of a benefit conferred on the other party that has unjustly enriched him or her.

Accepted Answer

A) True 
 B)False

Question 3

Consequential damages are foreseeable damages that arise from a party's breach of a contract.

Accepted Answer

A) True 
 B)False

Question 4

Metro Facilities,Inc.,contracts to sell a parking garage to Nouveau Property Company.The contract provides that if Metro does not close the deal by September 15,it must pay Nouveau one-half of the contract price.This provision is not enforceable because it is

Accepted Answer

A) a liquidated damages clause. 
B) a waiver of breach clause. 
C) a limitation-of-liability clause. 
D) a penalty clause.

Question 5

Compensatory damages compensate a party injured by a breach of contract by punishing the party that breached the contract.

Accepted Answer

A) True 
 B)False

Question 6

Lunch Trucks,Inc.,contracts to deliver and serve Meals Catering Service's products to its clients for $5,000 per event,payable in advance.Meals Catering pays the money,but Lunch Trucks fails to perform.Can Meals Catering rescind the contract Can Meals Catering also obtain restitution What does it mean to "rescind" a contract How is a contract rescinded What is restitution How is restitution accomplished Explain.

Accepted Answer

The answer of Lunch Trucks,Inc.,contracts to deliver and serve Meals...

Question 7

Bread & Bagels Bakery enters into a contract with Cineplex for discounted tickets for Bread & Bagels' employees.Cineplex breaches the contract and Bread & Bagels enters into a contract with DigiMovies for the same service at a lower price.Bread & Bagels might be awarded nominal damages to

Accepted Answer

A) establish,as a matter of principle,that Cineplex acted wrongfully. 
B) provide Bread & Bagels with funds for a foreseeable loss beyond the contract. 
C) provide Bread & Bagels with funds for its loss of the bargain. 
D) punish Cineplex and set an example to deter others from similar acts.

Question 8

Isaac holds one ton of perishable fruit in storage for Juice Smoothies Corporation.Juice Smoothies does not pay for the storage.Isaac sells the fruit to Kayo Beverage Company.This sale represents

Accepted Answer

A) a breach of contract. 
B) a mitigation of damages. 
C) liquidated damages. 
D) a quasi contract.

Question 9

Renew Turf,Inc.,enters into a contract with Sports Park to provide surface material for Sports Park's baseball fields by October 1 for a series to begin October 5.The contract specifies an amount to be paid if the contract is breached.This is a liquidated damages clause if the amount is

Accepted Answer

A) meant to pay for additional liquid sealant in the event of damage. 
B) a reasonable estimate of the loss on a breach. 
C) designed to penalize the breaching party. 
D) intended to quickly provide cash to the nonbreaching party.

Question 10

A remedy is the relief provided to an innocent contracting party when the other party breaches the contract.

Accepted Answer

A) True 
 B)False

Question 11

Rashi contracts to work for Social Data Analysis Corporation during June for $4,500.On May 31,Social Data cancels the contract.Rashi declines a job of a different type and rank with Tech Collection,Inc.,which would have paid $3500.Rashi files a suit against Social Data.As compensatory damages,Rashi can recover

Accepted Answer

A) $4,500. 
B) $4,000. 
C) $500. 
D) $0.

Question 12

When one party breaches a contract,the other party can only sue for damages.

Accepted Answer

A) True 
 B)False

Question 13

Sati contracts to work exclusively for Thermal Imaging Company during July for $5,000.On June 30,Thermal Imaging cancels the contract.Sati finds a similar job for the month of July but earns only $3,000.Sati files a suit against Thermal Imaging.As compensatory damages,Sati can recover

Accepted Answer

A) $3,000. 
B) $2,000. 
C) $1,000. 
D) $0.

Question 14

Dry Gulch Farms hires Elliot to repair its irrigation system on site on a certain date for $2,500,but Elliot does not show up as agreed.Dry Gulch hires Fernando to do the job for $2,000.Dry Gulch may recover from Elliot

Accepted Answer

A) nothing. 
B) compensatory damages. 
C) consequential damages. 
D) nominal damages.

Question 15

A contract between Recreational Games & Rides,Inc.,and Summer Fair Corporation includes a provision excluding liability as a result of fraud.This provision is

Accepted Answer

A) enforceable because the parties are protected from liability. 
B) enforceable because the parties consented to it. 
C) enforceable if the parties have equal bargaining power. 
D) not enforceable.

Question 16

Rebecca hires Samson to perform music at Becca's Bistro,but he breaches the agreement to accept a higher-paying job at Three Courses Dinner Theater.Rebecca files a suit against him.The court will most likely

Accepted Answer

A) award damages to Rebecca. 
B) cancel Samson and Three Courses' contract. 
C) order Samson to perform the contract with Rebecca. 
D) reform Rebecca and Samson's contract.

Question 17

Porches & Verandas,Inc.,agrees to build a screen porch for Quinn,but fails to complete the job.Quinn hires Ramadas,Inc.,to finish the project.Quinn may recover from Porches & Verandas

Accepted Answer

A) the contract price less costs of materials and labor. 
B) the contract price. 
C) the costs needed to complete construction. 
D) profits plus the costs incurred up to the time of the breach.

Question 18

Dawson owns Evergreen,a complex under construction that will include commercial and residential suites,as well as a parking garage.Dawson allows First Call Construction,Inc.,the contractor,to complete a stage of construction late.This waives Dawson's right to sue for

Accepted Answer

A) this delay only. 
B) any subsequent breaches by First Call. 
C) any future breaches by First Call or any subcontractor. 
D) none of the choices.

Question 19

Whether a contract's limitation-of-liability clause will be enforced depends on the type of breach that is excused by the provision.

Accepted Answer

A) True 
 B)False

Question 20

Medical Eye Clinic Corporation enters into a contract with local musician Natalie,who agrees to perform for a meeting of Medical Eye's personnel to be held in its main office building.Before the date of the meeting,Natalie refuses to perform,citing a higher-paying gig.Meanwhile,Medical Eye contracts to sell the building to Optical Center,Inc.,but before the transaction is complete,Perfect Vision Company offers to pay a higher price.Medical Eye refuses to transfer the building to Optical Center.In separate suits by Medical Eye against Natalie and by Optical Center against Medical Eye,each plaintiff seeks specific performance.How might the court rule in each case,and why

Accepted Answer

The answer of Medical Eye Clinic Corporation enters into a...

Exam 19: Breach of Contract and Remedies

Ordinarily,the remedy for a seller's breach of a contract for a sale of real estate is damages.

Restitution involves one party's recapture of a benefit conferred on the other party that has unjustly enriched him or her.

Consequential damages are foreseeable damages that arise from a party's breach of a contract.

Metro Facilities,Inc.,contracts to sell a parking garage to Nouveau Property Company.The contract provides that if Metro does not close the deal by September 15,it must pay Nouveau one-half of the contract price.This provision is not enforceable because it is

Compensatory damages compensate a party injured by a breach of contract by punishing the party that breached the contract.

Bread & Bagels Bakery enters into a contract with Cineplex for discounted tickets for Bread & Bagels' employees.Cineplex breaches the contract and Bread & Bagels enters into a contract with DigiMovies for the same service at a lower price.Bread & Bagels might be awarded nominal damages to

Isaac holds one ton of perishable fruit in storage for Juice Smoothies Corporation.Juice Smoothies does not pay for the storage.Isaac sells the fruit to Kayo Beverage Company.This sale represents

Renew Turf,Inc.,enters into a contract with Sports Park to provide surface material for Sports Park's baseball fields by October 1 for a series to begin October 5.The contract specifies an amount to be paid if the contract is breached.This is a liquidated damages clause if the amount is

A remedy is the relief provided to an innocent contracting party when the other party breaches the contract.

When one party breaches a contract,the other party can only sue for damages.

Sati contracts to work exclusively for Thermal Imaging Company during July for $5,000.On June 30,Thermal Imaging cancels the contract.Sati finds a similar job for the month of July but earns only $3,000.Sati files a suit against Thermal Imaging.As compensatory damages,Sati can recover

Dry Gulch Farms hires Elliot to repair its irrigation system on site on a certain date for $2,500,but Elliot does not show up as agreed.Dry Gulch hires Fernando to do the job for $2,000.Dry Gulch may recover from Elliot

A contract between Recreational Games & Rides,Inc.,and Summer Fair Corporation includes a provision excluding liability as a result of fraud.This provision is

Rebecca hires Samson to perform music at Becca's Bistro,but he breaches the agreement to accept a higher-paying job at Three Courses Dinner Theater.Rebecca files a suit against him.The court will most likely

Porches & Verandas,Inc.,agrees to build a screen porch for Quinn,but fails to complete the job.Quinn hires Ramadas,Inc.,to finish the project.Quinn may recover from Porches & Verandas

Dawson owns Evergreen,a complex under construction that will include commercial and residential suites,as well as a parking garage.Dawson allows First Call Construction,Inc.,the contractor,to complete a stage of construction late.This waives Dawson's right to sue for

Whether a contract's limitation-of-liability clause will be enforced depends on the type of breach that is excused by the provision.