Cleo entered into a contract with Harvey in June to redecorate his apartment before Christmas. However, in the middle of October, she informed him that she would not be able to do his job because she had been offered a big contract in Japan that would take her away until spring. Which of the following is true with respect to this situation?
A) Cleo could claim quantum meruit for any work she had done so far and that would be the end of the matter.
B) The most likely remedy would be for the court to award specific performance to make her do the job.
C) Their contract has been frustrated by circumstances outside their original contemplation, and thus they are excused from their previous obligations.
D) Cleo has repudiated the contract and Harvey can take legal action immediately.
E) Harvey must wait until Christmas to see if Cleo actually performs before he can take legal action.

Question

Quizplus · Accepted Answer

Cleo has clearly repudiated the contract by informing Harvey that she would not be able to do the job. Harvey can take legal action immediately to seek damages for breach of contract. Specific performance is not a likely remedy in this situation as it would be difficult to force Cleo to complete the job, especially if she is in Japan. Frustration of the contract applies in situations where it becomes impossible to perform the contract due to unforeseeable circumstances beyond the control of both parties. It does not apply in this case as Cleo's inability to perform was due to a new and better opportunity, not an unforeseeable circumstance. Quantum meruit may apply for any work already done, but that would not be the end of the matter as Harvey would still be entitled to seek damages for breach of contract. Waiting until Christmas to see if Cleo actually performs is not a reasonable option as it would delay any legal action and may result in further losses for Harvey.

Cleo Entered into a Contract with Harvey in June to Redecorate