Where the courts have been faced with an exemption clause that exempts a breach that is so serious that it defeats the whole purpose of the contract, the court, to prevent the party in breach from sheltering behind the exemption clause,
A) interpreted the contract without the exemption clause.
B) have required that the party in breach pay a fine.
C) have awarded damages to the aggrieved party.
D) have classified the breach as a fundamental breach
E) have classified the breach as an anticipatory breach.

Question

Quizplus · Accepted Answer

When a breach is classified as a fundamental breach, it means that it is so serious that it goes to the root of the contract and defeats its essential purpose. In such a case, the party in breach cannot rely on any exemption clause in the contract to avoid liability. Therefore, choice D is the best option.

Where the Courts Have Been Faced with an Exemption Clause