Question 1

These result from a breach of contract and may also be limited or excluded by an agreement.

Accepted Answer

Liability for consequential damages resulting from a breach of contract (such as lost profits or damage to property)may also be limited or excluded by agreement.The limitation or exclusion is not enforced if it would be unconscionable.

Question 2

When the buyer refuses to accept goods that conform to the contract or repudiates the contract,the seller has to resell the goods.

Accepted Answer

When the buyer refuses to accept goods that conform to the contract or repudiates the contract, the seller typically has the right to recover damages, but is not required to resell the goods. In some cases, the seller may resell the goods, but this is not a requirement under most contracts or legal systems.

Question 3

When a buyer breaches a contract,a seller does not have the right to mitigate damages.

Accepted Answer

A seller has the obligation to mitigate damages when a buyer breaches a contract. This means that they must take reasonable steps to minimize the losses caused by the breach, such as reselling the goods or finding another buyer. Failing to mitigate damages can result in a reduction of the damages awarded to the seller in a legal dispute.

Question 4

An injured buyer is able to recover consequential damages even if he could have prevented the damage by obtaining substitute goods.

Accepted Answer

Consequential damages are recoverable only if they are foreseeable and the injured party has not failed to mitigate damages, which includes obtaining substitute goods if reasonably possible.

Question 5

If the seller fails to deliver the goods,the buyer may cancel the contract.

Accepted Answer

According to the general rule, if the seller fails to deliver the goods, the buyer has the right to cancel the contract. However, if the seller proves that the delay was due to circumstances beyond their control, the buyer may not be able to cancel the contract.

Question 6

A breach of warranty is normally considered to have occurred:

Accepted Answer

According to the Code,a breach of warranty normally is considered to have occurred when the goods are delivered to the buyer.

Question 7

When one of the parties to a contract fails to perform his obligations,he enjoys a variety of remedies for breach of contract.

Accepted Answer

The answer of When one of the parties to a...

Question 8

If the seller refuses to deliver the goods called for by the contract,the buyer can recover as damages from the seller the difference between the contract price of the goods and the cost of the substitute goods.

Accepted Answer

This is correct. It is known as the measure of damages for non-delivery or anticipatory breach. The buyer is entitled to recover the difference between the contract price and the market price at the time and place where the buyer could have obtained substitute goods.

Question 9

A seller is not liable for paying damages when the buyer rightfully rejects goods.

Accepted Answer

A seller is typically liable for damages if the buyer rightfully rejects goods due to non-conformity with the contract.

Question 10

If the parties agree on the amount of damages that will be paid to the injured party,this amount is known as ____.

Accepted Answer

The buyer and seller may provide their own remedies,to be applied in the event that one of the parties fails to perform.If the parties agree on the amount of damages that will be paid to the injured party,this amount is known as liquidated damages.An agreement for liquidated damages is enforced if the amount is reasonable and if actual damages would be difficult to prove in the event of breach of the contract.

Question 11

If a liquidated damages clause is not enforceable because it is unconscionable,the injured party is barred from recovering actual damages.

Accepted Answer

If a liquidated damages clause is found to be unconscionable and unenforceable, the injured party may still be able to recover actual damages.

Question 12

Which of the following statements is true for consequential damages?

Accepted Answer

Liability for consequential damages resulting from a breach of contract (such as lost profits or damage to property)cannot be enforced if it is found to be unconscionable.

Question 13

The seller may recover the contract price from the buyer when he/she manufactured goods especially for the buyer and those goods are not usable by anyone else.

Accepted Answer

This concept is known as "specialty goods" under the Uniform Commercial Code (UCC) and allows the seller to recover the contract price from the buyer if the goods were specially made for the buyer and are not suitable for sale in the ordinary course of business to others.

Question 14

Parties may extend the length of time in which a lawsuit can be filed for breach of sales contract to six years.

Accepted Answer

The answer of Parties may extend the length of time...

Question 15

After breach of contract by a buyer,if a seller auctions the goods and makes profit,he is not liable to give the profit to the buyer.

Accepted Answer

If a buyer breaches a contract, the seller has the right to re-sell the goods and keep any profits made from the auction. This is known as the principle of "resale damages" or "cover damages." The seller is not liable to give any profits made to the buyer.

Question 16

The objective of providing remedies for breach of a sales contract is to:

Accepted Answer

Usually,both parties to a contract for the sale of goods perform the obligations they agreed to in the contract.Occasionally,however,one of the parties to a contract fails to perform his obligations.When this happens,the injured party has a variety of remedies for breach of contract.The objective of these remedies is to put the injured person in the same position as if the contract has been performed.

Question 17

Buyers are entitled to specific performance if the goods covered by a contract are unique.

Accepted Answer

If the goods covered by a contract are unique, buyers are entitled to specific performance, which is a court-ordered remedy requiring the seller to fulfill their contractual obligations and deliver the unique goods to the buyer. This is because it may be difficult or impossible for the buyer to obtain similar goods elsewhere, and damages would not be an adequate remedy for the buyer.

Question 18

Any attempts to limit consequential damages for injury caused to a person by consumer goods is considered prima facie unconscionable.

Accepted Answer

This statement is taken from Section 2-719(3) of the Uniform Commercial Code, which states that any attempt to limit consequential damages for personal injury caused by consumer goods is prima facie unconscionable. This means that such a provision would be presumed to be unfair or unreasonable unless proven otherwise, and may be unenforceable as a result.

Question 19

If the seller fails or refuses to deliver the goods called for in the contract,the buyer has the right to cover.

Accepted Answer

If the seller fails or refuses to deliver the goods, the buyer has the right to cover by purchasing substitute goods from another seller and may recover any damages incurred as a result of the seller's breach of contract.

Question 20

The parties' agreement on the amount of damages to be paid,if one of them breaches their contract,will not be enforced if the amount named is unreasonable.

Accepted Answer

This is known as a penalty clause, and courts do not generally enforce them as they are seen as a way for one party to exert pressure on the other party to comply with the contract. The amount of damages named must be a reasonable estimate of the actual harm that the non-breaching party would suffer if the contract is breached.

Quiz 22: Remedies for Breach of Sales Contracts