Question 1

Under common law,an individual improperly fired from their employment has a duty to their former employer to try to find a replacement job as quickly as possible.

Accepted Answer

Under common law, the duty to mitigate damages requires an individual who has been improperly fired to make reasonable efforts to find new employment to reduce the damages owed by the former employer.

Question 2

An assignment is effectively the same thing as novation.

Accepted Answer

An assignment involves transferring the benefits under a contract, such as rights or interests, from one party to another, but the original party remains obligated under the contract. Novation, on the other hand, replaces one of the original parties to the contract with a new party, thereby releasing the original party from their obligations.

Question 3

Specific performance is only available with the goods are easily replaced.

Accepted Answer

Specific performance is typically sought in cases where the goods are unique and cannot be easily replaced, making monetary compensation inadequate.

Question 4

Which remedy would a court most likely award to restore parties to their original pre-contractual positions?

Accepted Answer

Contractual rescission is the remedy that aims to restore the parties to their original positions before the contract was made, effectively treating the contract as if it never existed.

Question 5

A person claiming frustration must establish that the event arose without either party's fault.

Accepted Answer

For a claim of frustration to be valid, it must be demonstrated that the event causing the contract to be impossible to fulfill occurred without the fault of either party involved.

Question 6

Which of the following accurately describes the legal position of the plaintiff in a case of anticipatory breach of the contract by the defendant?

Accepted Answer

In cases of anticipatory breach, where the defendant indicates they will not fulfill their contractual obligations before the due performance date, the plaintiff is entitled to sue for damages immediately. This allows the plaintiff to address the breach without having to wait for the time of performance to pass, providing a remedy for the loss anticipated due to the defendant's expressed intention not to perform.

Question 7

A warranty is a contract term that entitles a party to rescission of the contract.

Accepted Answer

A warranty is a promise or guarantee provided by a seller to a buyer regarding the condition of a product, but it does not automatically entitle a party to rescission of the contract. Rescission is typically related to more fundamental breaches of contract.

Question 8

Speedy Deliveries delivered an envelope two days later than they had promised in their courier services contract.Unbeknownst to Speedy,the envelope contained important title documents and their client now alleges the late delivery caused a real estate deal to fall through and is suing Speedy for the $200,000 profit it had expected to make from the deal.Which statement describes the most likely outcome?

Accepted Answer

The claim is likely to fail because the damages (loss of $200,000 profit from the real estate deal) are considered too remote, meaning they are not a foreseeable consequence of the breach of contract (late delivery of the envelope) that Speedy Deliveries could have anticipated. In contract law, for damages to be recoverable, they must be a foreseeable result of the breach at the time the contract was made. Since Speedy was unaware of the contents of the envelope or its significance to a real estate deal, the loss of profit is not a direct and foreseeable consequence of the late delivery.

Question 9

An assignee's rights can be no greater than the assignor's rights.

Accepted Answer

An assignee steps into the shoes of the assignor and therefore can only acquire the rights that the assignor had to transfer.

Question 10

A creditor has assigned a debt to a collection agency.As an assignee,the collection agency is not a party to the original contract and is therefore barred under the doctrine of privity from acquiring any rights to own the debt under it.

Accepted Answer

When a creditor assigns a debt to a collection agency, the agency steps into the shoes of the creditor and acquires the rights to collect the debt, despite not being a party to the original contract. This is a common practice in debt collection and is legally permissible.

Question 11

Both parties to the original contract must agree to an assignment for it to be enforceable.

Accepted Answer

An assignment of a contract typically does not require the consent of the non-assigning party, unless the contract specifically states otherwise or the assignment would significantly change the obligations of the non-assigning party.

Question 12

What legal remedy is applied in circumstances where a court orders a party to refrain from acting in a specific manner?

Accepted Answer

An injunction is a legal remedy issued by a court that compels a party to do or refrain from specific acts. It is often used to prevent harm or to maintain the status quo during litigation.

Question 13

Novation of a contract will result in the termination of the original contract.

Accepted Answer

Novation of a contract involves substituting a new contract in place of the old one, effectively terminating the original contract and releasing the parties from their obligations under it.

Question 14

What is the legal definition of the term injunction?

Accepted Answer

An injunction is a legal order issued by a court that requires a party to do or to refrain from doing specific acts. It does not involve the substitution of parties or contracts, nor does it pertain to the transfer of contractual rights.

Question 15

What is the legal term for a remedy in which the court utilizes its jurisdiction to order an injunction for a stated period of time?

Accepted Answer

An interlocutory injunction is a court order that prohibits a party from doing something for a stated period of time.

Question 16

An assignee is entitled to collect the debt owed under a contract despite not being involved in the creation of the contract that produced the debt.

Accepted Answer

An assignee, having been transferred the rights under a contract by the assignor, is entitled to collect the debt owed, even though they were not a party to the original contract. This is a fundamental principle of contract law that allows for the assignment of rights.

Question 17

A breach can have the effect of terminating a contract.

Accepted Answer

A breach, especially a material breach, can give the non-breaching party the right to terminate the contract and seek damages.

Question 18

Under the common law test for remoteness,damages are not generally considered reasonably foreseeable where any unusual circumstances were communicated to the offending party at the time the contract was formed.

Accepted Answer

Under the common law test for remoteness, damages are considered reasonably foreseeable if the type of damage was communicated or should have been known by the offending party at the time the contract was formed, including any unusual circumstances.

Question 19

A clause that excludes or limits liability even for a profoundly serious breach of contract is unenforceable,if it is unconscionable or would be unfair or unreasonable.

Accepted Answer

Such clauses, known as exclusion or limitation clauses, can be deemed unenforceable if they are found to be unconscionable, unfair, or unreasonable, especially in cases of serious breaches. This is because the law aims to prevent parties from evading liability for significant wrongdoing through contractual terms.

Question 20

Normally the goal of damages in contract law is to put the wronged party in the same monetary position as if the contract had been completed.

Accepted Answer

Damages in contract law are typically aimed at compensating the injured party for their loss, essentially putting them in the position they would have been in had the contract been fully performed.

Quiz 9: Termination and Enforcement of Contracts