Which of the following is true about a substituted contract?
A) The prior contract can be enforced against a breaching party of a substituted contract.
B) A nonbreaching party can sue to enforce its terms against the breaching party.
C) Parties in the contract are not liable for nonperformance.
D) The contract substitutes a third party for one of the original parties.

Question

Quizplus · Accepted Answer

A substituted contract involves substituting a new contract for an existing one. In this context, a nonbreaching party can enforce the terms of the substituted contract against the breaching party. The prior contract is discharged, and the parties in the contract remain liable for nonperformance. Option A is incorrect because the prior contract is discharged, and therefore, it cannot be enforced against the breaching party of the substituted contract. Option C is also incorrect because the parties in the contract remain liable for nonperformance. Option D does not make sense in the context of a substituted contract.

Which of the Following Is True About a Substituted Contract