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2. When a party to a contract breaches the contract, the other party is legally
entitled to:
a. An apology.
b. Nothing, because breaches are legally permissible and have no
consequences.
c. Money damages.
d. Prosecute the breaching party for a criminal violation.
ANS:
a. Incorrect. Morality may require an apology in this situation, but the law
does not.
b. Incorrect. The nonbreaching party is entitled to money damages.
c. Correct. Because the nonbreaching party has been harmed, he or she is
entitled to money damages.
d. Incorrect. Breach of contract is a civil violation, not a criminal violation.
3. When the remedy of specific performance is not possible, what is the measure
of damages in a case involving the sale of land?
a.
b.
c.
d.
ANS:
a. Incorrect. Foreseeable damages would be consequential damages.
b. Incorrect. Punitive damages are not usually awarded under contract law.
ANS:
a. Correct. Because the purpose of punitive damages is to punish a
wrongdoer, they are typically not available in contract cases.
b. Incorrect. This form of damages is generally not available.
c. Incorrect. Even for minors, this form of damages is generally not available.
d. Incorrect. This describes nominal, not punitive, damages.
6. If Valerie contracts with Bill to build a stone wall on his property and Valerie
breaches the contract, Bill is under a legal obligation to:
a.
b.
c.
d.
ANS:
a. Incorrect. As a general rule, Bill does not have to wait for Valerie to
perform; he may find another contractor to build the stone wall.
b. Correct. Bill has a legal duty to mitigate, or lessen, the damages he suffers
as a result of Valerie's breach.
c. Incorrect. Bill cannot just sit by and do nothing. He must take reasonable
steps to lessen the harms he suffers.
d. Incorrect. Bill does not have to absorb all the costs associated with
Valeries breach--she is responsible for many of these costs.
7. Liquidated damages may be defined as:
a.
b.
c.
d.
ANS:
a.
b.
c.
d.
8. Suppose that Jennifer agrees to tutor Sals children during the summer. After
one week, Jennifer decides that she cant handle the children and refuses to tutor
them any longer. If Sal sues Jennifer for specific performance, a court would
likely:
a. refuse to order specific performance of the contract because it is a
contract for personal services.
b. grant Sals request, because Jennifer breached her contract.
c. grant Sals request, but only if Sal could not find another tutor.
d. require Jennifer to mitigate her damages.
ANS:
a. Correct. Courts refuse to enforce such contracts because to do so
amounts to a type of involuntary servitude, which is contrary to the public
policy expressed in the Thirteenth Amendment to the Constitution.
b. Incorrect. Courts refuse to enforce such contracts because to do so
amounts to a type of involuntary servitude, which is contrary to the public
policy expressed in the Thirteenth Amendment to the Constitution.
c. Incorrect. Even in this situation, a court would refuse to enforce the
contract because to do so amounts to a type of involuntary servitude,
which is contrary to the public policy expressed in the Thirteenth
Amendment to the Constitution.
A contributory clause.
An exculpatory clause.
An indentured clause.
A force majeure clause.
Incorrect. These kinds of clauses are not known as contributory clauses.
Correct. This is an example of an exculpatory clause.
Incorrect. There are no indentured clauses.
Incorrect. This is not an example of a force majeure clause.
10. In order to prevent plaintiffs from recovering twice, plaintiffs are required
under the common law to:
a.
b.
c.
d.
ANS:
a. Incorrect. Suing in state courts only will not satisfy this concern.
b. Correct. Plaintiffs must elect which remedy they wish to seek in order to
prevent double recovery.
c. Incorrect. Suing in federal courts only will not satisfy this concern.
d. Incorrect. Suing only for nominal damages is not the required means of
satisfying the double-recovery concern.