Builders,Inc.,agrees to construct an office building for Champion Fitness Clubs,Inc. The project proceeds according to plan,but before it is done,Champion tells Buildersto quit. Buildersmay recover
A)the contract price less costs of materials and labor.
B)the contract price.
C)the costs needed to complete construction.
D)profits plus the costs incurred up to the time of the breach.

Question

Quizplus · Accepted Answer

Builders, Inc. is entitled to recover the costs needed to complete construction as Champion Fitness Clubs, Inc. breached the contract by telling Builders to quit before the project was completed. The costs needed to complete construction would enable Builders to recover their losses and also compensate them for the work already completed. Options A and B do not take into account the costs incurred by Builders and therefore do not provide full compensation. Option D includes profits, which may not be recoverable as they are dependent on the completion of the project.