Question 1

Outdoor Properties, Inc. (OPI), agrees to sell certain acreage to Pia. OPI repudiates the deal. Pia sues OPI and recovers dam?ages. Pia can now obtain

Accepted Answer

The answer of Outdoor Properties, Inc. (OPI), agrees to sell...

Question 2

Ira orally agrees to buy a unique collection of sports memorabilia for $1,000 from Jane and sends her $250 as a down payment. When Ira sends her the rest of the price, Jane refuses to ship Ira the collection. Ira should seek

Accepted Answer

Since the collection of sports memorabilia is unique, and Jane has refused to sell it to Ira after he made a valid agreement and sent a down payment, Ira can seek specific performance. This means that he can ask the court to order Jane to complete the transaction and deliver the collection to him as agreed. Damages, reformation, or rescission may not be appropriate in this situation, as they would not guarantee Ira's access to the unique collection.

Question 3

Refined Commodities, Inc., agrees to deliver ten tons of sheet metal to Select Builders Corporation. The agreement states that delivery is to be within "3" days, although the parties intend "30" days. Refined cannot convince Select to amend the contract. Refined should seek

Accepted Answer

Refined should seek reformation of the contract to reflect the parties' actual intention of a 30-day delivery period. This will allow the contract to be amended to accurately reflect the agreement and prevent any potential breach of contract.

Question 4

Dino hires Eve to perform at Dino's Club, but Eve later breaches the agreement to accept a higher-paying job at First Star Arena. Dino files a suit against Eve. The court will most likely

Accepted Answer

If Eve breaches the agreement, Dino can file a suit against her to recover damages. The court will most likely award damages to Dino to compensate for the loss suffered due to Eve's breach. Cancelling or ordering Eve to perform the contract is not feasible as Eve has already breached the agreement. Reforming the contract is also not applicable in this scenario.

Question 5

Roy contracts to sell his Double-R Ranch to Sam on May 1. On April 20, Roy tells Sam that he will not go through with the deal. Sam files a suit against Roy. Sam can recover

Accepted Answer

Sam can recover the Double-R Ranch because Roy breached the contract by refusing to perform before the due date, allowing Sam to seek specific performance, which is a remedy that compels the breaching party to fulfill the terms of the contract.

Question 6

A orally agrees to pay B to plant and harvest a quarter of A's farm acreage for four corn-planting seasons. After B prepares the land and plants the first crop, A says that their deal is off. B can most likely recover

Accepted Answer

B can recover in quasi contract because A's oral agreement is unenforceable under the Statute of Frauds, which requires contracts that cannot be performed within one year to be in writing. Quasi contract allows B to recover the value of the benefit conferred to A.

Question 7

Home Delivery Corporation and Interstate Transport, Inc., sign an agree?ment that provides for the payment of "$1,000 by whichever party commits a material breach of the contract that creates damages difficult to esti?mate but approximately $1,000." This is

Accepted Answer

The clause specifies a predetermined and fixed amount of damages to be paid in the event of a material breach, which is a characteristic of a liquidated damages clause.

Question 8

To avoid liability for intentional injuries, Vermont Power Corporation in?cludes in its contracts an exculpatory clause. This is

Accepted Answer

Exculpatory clauses that relieve a party from liability for intentional injury are generally not enforceable as they go against public policy and undermine the deterrent value of tort law. Therefore, Vermont Power Corporation's exculpatory clause is not enforceable even if the other parties consent to it or have equal bargaining power.

Question 9

Value Acquisitions, Inc., contracts to buy Wobbling Corporation's as?sets. Wobbling breaches the contract. Value files a suit against Wobbling, seeking various remedies. The doc?trine of election of remedies has been elimi?nated in contracts involving sales of

Accepted Answer

The doctrine of election of remedies has been eliminated in contracts involving sales of goods under Article 2 of the Uniform Commercial Code (UCC), which governs the sale of goods. The doctrine allowed a party to choose between different remedies for breach of contract, such as canceling the contract or suing for damages. However, under the UCC, a party may pursue multiple remedies simultaneously without having to make an election.

Question 10

A contract for a sale of land from United Properties, Inc., to Variety Investments Corporation contains an erroneous legal description. The most appropriate remedy for these parties is

Accepted Answer

The most appropriate remedy for an erroneous legal description in a contract for the sale of land is reformation. This involves correcting the error in the legal description and is preferable over rescission, which involves canceling the contract altogether, or damages, which may not fully compensate the parties for their losses. Specific performance may also be an option if both parties agree to proceed with the sale after the legal description is corrected. However, reformation is the best initial option for correcting the error.

Question 11

A enters into a contract with B to provide surface material for A's tennis courts by April 1 for a tournament to begin May 1. 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 liquidated damages clause is considered valid and enforceable if the amount specified in the contract is a reasonable estimate of the actual damages that would be incurred in case of a breach. Therefore, choice B is the correct answer. Choices A and C are incorrect because an excessive estimate of damages or a clause designed to penalize the breaching party would make the liquidated damages clause unenforceable. Choice D is incorrect because the purpose of a liquidated damages clause is not to provide quick cash to the nonbreaching party, but rather to compensate them for actual damages incurred.

Question 12

Lou and Mira want to rescind their contract under which Lou sold an MP3 player to Mira for $50. To rescind the contract

Accepted Answer

Rescinding a contract means that the parties want to undo the agreement and return to their original positions. In this case, Lou must return the $50 and Mira must return the MP3 player for the contract to be rescinded. Both parties must give back what they received in order for the contract to be fully undone.

Question 13

Creekside Property Corporation enters into a contract with Delta Management Associates to manage and maintain Creekside's apartment complex. Their contract provides that neither party can recover damages for a non-fraudulent or unintentional breach. This is

Accepted Answer

This is a limitation-of-liability clause, which limits the liability of both parties in the case of a non-fraudulent or unintentional breach of the contract.

Question 14

For Petra to recover the benefit of her bargain from a breached real estate contract with Quality Properties, Inc., the most appropriate remedy is

Accepted Answer

Specific performance is the most appropriate remedy for a breached real estate contract as it involves the party fulfilling their obligations as agreed upon in the contract. This would require Quality Properties, Inc. to transfer the property to Petra as agreed upon in the contract. Damages may not fully compensate Petra for the loss suffered, quasi-contractual recovery is not applicable as there was a valid contract in place, and rescission would only cancel the contract without ensuring that Petra receives the property she bargained for.

Question 15

Rig Heli-Pads, Inc., enters into a contract to employ Scott as an on-site project manager for two years. If Rig breaches the contract, Scott has a duty to

Accepted Answer

If Rig breaches the contract, Scott has a duty to mitigate his damages, which means he must take reasonable steps to reduce the losses that he might suffer as a result of the breach. This would include seeking alternative employment to minimize his loss of income. Punishing Rig or rescinding the contract may not be appropriate or feasible options.

Question 16

Ray breaches his lease with Sunny Properties and vacates the premises six months before the end of the term. In some states, Sunny would have to

Accepted Answer

In most states, landlords have a duty to mitigate damages by making reasonable efforts to relet the premises when a tenant breaches their lease and vacates early. This means that Sunny Properties should try to find a new tenant as soon as possible to minimize the financial impact of Ray's breach. Option A is incorrect because avoiding reletting could result in greater damages for Sunny Properties. Option C is not entirely correct because reletting is only one way that Sunny Properties can recover damages, but not necessarily the only way. Option D is also incorrect because selling the premises is not a practical or reasonable solution for recovering damages from Ray's breach of lease.

Question 17

Grady enters into a contract to buy 440 acres from Hollis to expand Grady's ranch. If Hollis breaches the contract, Grady's normal remedy would be

Accepted Answer

The best choice is D, specific performance. This is because the contract concerns the sale of unique real property (440 acres), so monetary damages would not be an adequate remedy. Therefore, Grady would seek a court order requiring Hollis to perform the contract and sell the property as agreed. Quasi contract (B) would not apply because there is an actual contract between the parties. Reformation (C) is a remedy used to correct mistakes in the contract, and it would not apply if Hollis breached the contract.

Question 18

Drew contracts to sell a residential duplex to Evan. The contract pro?vides that if Drew does not close the deal by September 15, he must pay Evan one-half of the contract price. This provision is not enforceable be?cause it is

Accepted Answer

The provision is not enforceable because it is a penalty clause. Penalty clauses are provisions that are designed to punish a party for failing to perform rather than to compensate the other party for the damages suffered. Courts generally disfavor penalty clauses and may strike them down as unenforceable. In this case, the provision requiring Drew to pay one-half of the contract price if he fails to close by September 15 is a penalty and not a valid liquidated damages clause.

Question 19

A contract between E-Debits, Inc., and First Credit Corporation includes a provision excluding liability as a result of fraud. This provision is

Accepted Answer

A provision excluding liability for fraud is generally not enforceable because it goes against public policy to allow parties to contract out of liability for fraudulent acts.

Question 20

Rural Utility, Inc., enters into a contract with Shovel Excavation Service to dig up, replace, and rebury Rural's cables in a certain location. Rural advances Shovel 10 percent of its cost. If the parties rescind the contract, Shovel's refund of the payment would be

Accepted Answer

The answer of Rural Utility, Inc., enters into a contract...

Quiz 18: Breach of Contract and Remedies

Outdoor Properties, Inc. (OPI) , agrees to sell certain acreage to Pia. OPI repudiates the deal. Pia sues OPI and recovers dam?ages. Pia can now obtain