Question 1

Bob's brother, Steve, planned to visit over Labor Day weekend. Together they planned to build a deck in Bob's backyard. Bob ordered the lumber, concrete, nails, and other supplies to be delivered on Friday. He also arranged to rent a saw for the weekend (Sat., Sun., and Mon.) at a cost of $20 a day. When he went to pick up the saw, the store had already rented it. He drove all over town trying to borrow another but could only get one for Sunday, Monday, and Tuesday at a cost of $50 per day. Because they couldn't work on Saturday without a saw, Bob had to hire Mac at a cost of $80 to work with him on Tuesday and, of course, Bob had to take off from work. Calculate the damages to which Bob is entitled. Why? Explain.

Accepted Answer

The answer of Bob's brother, Steve, planned to visit over...

Question 2

In the case of Hadley v. Baxendale , the plaintiff was seeking damages for:

Accepted Answer

The case of Hadley v. Baxendale involved a claim for lost profits due to a delay in the delivery of a broken mill shaft, which caused the mill to remain non-operational.

Question 3

Which of the following is correct with respect to election of remedies?

Accepted Answer

A person who seeks an injunction may also seek incidental damages for the breach, as these remedies can be complementary rather than mutually exclusive.

Question 4

Busby contracts to build a house for Connell. Busby finishes approximately half of the house and quits. Connell files suit against Busby. Which remedy is not available?

Accepted Answer

The answer of Busby contracts to build a house for...

Question 5

To accomplish the basic purposes of contract remedies, which of the following limitations have not been imposed upon monetary damages?

Accepted Answer

Restitution is not a limitation on monetary damages; rather, it is a type of remedy aimed at preventing unjust enrichment. The limitations on monetary damages typically include foreseeability, certainty, and mitigation.

Question 6

In which of the following situations will a court grant specific performance?

Accepted Answer

Specific performance is typically granted in cases involving the sale of real property and where goods are unique or rare, as monetary damages would not adequately compensate for the loss.

Question 7

Bartow signed a contract to coach baseball for Washington High for a period of three years. After two years he is offered and accepts an assistant coaching position at State University. Contract law will not allow Washington High to ask for:

Accepted Answer

Specific performance is a remedy in contract law that compels a party to execute the contract according to its precise terms. However, it is generally not applicable to personal service contracts, such as coaching, because it would be impractical and against public policy to force someone to work against their will.

Question 8

Howard needs a truck to pull a 2,000-pound trailer. Gordon tells Howard, "My truck will pull a 2,000 pound trailer with ease." Relying on Gordon's statement, Howard buys the truck, but it will not pull a 2,000-pound trailer. If Gordon did not intend to deceive and Howard sues for nonfraudulent misrepresentation, he can ask for:

Accepted Answer

Howard can ask for out-of-pocket damages, which compensate for the difference between the value of what was received and what was paid, plus consequential damages for any additional losses caused by the misrepresentation.

Question 9

Contract damages that put the injured party in as good a position as if the other party had performed are:

Accepted Answer

Compensatory damages are intended to compensate the injured party for the loss incurred and to put them in the position they would have been in if the contract had been performed as agreed.

Question 10

Carolyn agrees to sell Marianne an antique handmade lace tablecloth for $1,500. When Carolyn discovers that her cousin wants it too, she breaks the contract with Marianne. Marianne can ask the court to order:

Accepted Answer

Specific performance is a remedy that compels a party to execute the contract according to its precise terms, often used when the subject matter is unique, such as an antique tablecloth.

Question 11

Lynne agrees to buy Harriette's farm for $200,000 and puts $20,000 down. Then Lynne learns she is allergic to hay and repudiates the contract. If Harriette can sell the farm in a good faith transaction for $190,000 a month later, she may:

Accepted Answer

Harriette can keep $10,000 of Lynne's down payment as damages for the breach of contract, which represents the difference between the original contract price and the resale price.

Question 12

Barbara, an antique dealer, intentionally misrepresents the value of an antique chest of drawers, as $6,000 when she has reason to know the value is considerably less. Margaret agrees to buy it for $5,500. It is worth $2,500. In a state that uses the "out-of-pocket" rule, Margaret's damage award would be:

Accepted Answer

Under the "out-of-pocket" rule, damages are calculated as the difference between the price paid and the actual value. Margaret paid $5,500 for an item worth $2,500, so her damages are $5,500 - $2,500 = $3,000.

Question 13

What principle did the court apply in the case of Madison Square Garden Corp., Ill. v. Carnera ?

Accepted Answer

The court applied the principle that when damages are not adequate, an injunction may be used to enforce a negative covenant regarding exclusive services that are unique and extraordinary.

Question 14

Damages for reliance include expenses for:

Accepted Answer

Reliance damages cover expenses incurred in preparation for performance or in reliance on the contract, not lost profits, personal injury, or punitive measures.

Question 15

A power of avoidance held by a party may be lost if:

Accepted Answer

A power of avoidance may be lost if the contract is affirmed, there are unreasonable delays in exercising the power, or if the rights of third parties intervene.

Question 16

Vladimir entered into a contract to buy Daniel's collection of rare stamps. Vladimir mailed payment of $10,000 for the stamps to Daniel, but now Daniel tells Vladimir, "I'll never part with these stamps." Are the following remedies available to Vladimir?

Accepted Answer

Restitution is available because Vladimir paid $10,000, and he can recover this amount if the contract is breached. Specific performance is also available because the stamps are unique items, and monetary damages may not adequately compensate for the breach.

Question 17

David enters into a contract giving Edward the right of first refusal on a tract of land owned by David. David subsequently offers the land to Fred without first offering it to Edward. An appropriate remedy for Edward to seek would be:

Accepted Answer

An injunction would be appropriate to prevent David from selling the land to Fred until Edward has been given the opportunity to exercise his right of first refusal.

Question 18

Scott, a minor, sells his digital camera to Megan, who then sells it to Sherry. Under these circumstances:

Accepted Answer

If Sherry is a good faith purchaser for value and she buys the camera before Scott elects to rescind, no rescission is permitted. This is because a good faith purchaser for value is protected under the law, and Scott's right to rescind is cut off once the item is sold to such a purchaser.

Question 19

In which of the following situations is restitution available as a remedy?

Accepted Answer

Restitution is available in all these situations: as an alternative remedy for breach, for a party in default, and when a contract is unenforceable due to the statute of frauds.

Question 20

Harry said to Marge, "I have a ring once owned by Marilyn Monroe. Would you like to buy it for $500?" Marge pays for the ring, but the next day a friend tells her that Harry had recently purchased the ring at a local store. Marge enjoys wearing the ring and wears it constantly for twelve months. Finally, she goes to Harry and says, "Here is the ring you lied about. Give me my $500." Most likely Marge will:

Accepted Answer

Marge will not get her money back because she affirmed the contract by wearing the ring for twelve months, which is considered an unduly long time to disaffirm the contract based on the alleged fraud.

Quiz 18: Contract Remedies