Psi Corp owned a ship called The Greek. It intended to use that ship to fulfill a contract with Omega Inc under which it promised to deliver widgets from Vancouver to Los Angeles. If it failed to perform that contract, it would be required to pay $5 000 000 to Omega Inc. Wilson negligently created a fire that destroyed The Greek. Psi Corp wanted to buy a replacement ship for the purpose of performing its contract with Omega Inc, but could not immediately afford the purchase price of $20 000 000. It therefore rented a ship, The Canadian, for $2 000 000 and used it to fulfill its contractual obligation. Psi Corp has successfully sued Wilson for negligence. The court agrees that Psi Corp is entitled to $20 000 000, which was the value The Greek. Psi Corp, however, claims that it is also entitled to $2 000 000, representing the money that it was required to pay in order to rent The Canadian. Which of the following statements is TRUE with respect to Psi Corp's claim for $2 000 000?
A) That claim traditionally would have failed because the relevant loss is partially attributable to the plaintiff's own poverty.
B) That claim will be decided by the crumbling skull rule.
C) That claim is properly decided under the concept of an intervening act.
D) That claim will probably fail because there was a lack of factual causation.
E) That claim will probably fail because there was no duty of care.
Correct Answer:
Verified
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