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Exam 16: Performance and Discharge

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Question 1

True/False

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The most common way to terminate contractual duties is by repudiation.

A) True
B) False

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False

Question 2

Multiple Choice

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Rene contracts with Scot to pay him $5,000 for repairs to Rene's lake cabin. After Scot performs, Rene tells him that she cannot pay him in full immediately. They sign an agreement in which Rene promises to pay $2,500 now instead of $5,000 later. This is

A) a mutual agreement to rescind.
B) an accord and satisfaction.
C) a novation.
D) specific performance.

E) A) and B)
F) B) and C)

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Question 3

Essay

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Quest Resources, Inc., contracts with Ring Communications Corporation (RCC) for RCC to design and build an all-weather communications system for Quest's field operations. RCC builds the system, but it functions effectively only in good weather. Is this a breach of the contract? If so, what remedies does Quest have?

If performance of a contract is not substantial, there is a material breach, which excuses the nonbreaching party from performance.

Sara enters into a contract to sell her condo to Ted for a certain price on a specific day. On that day, Sara unconditionally offers to perform. Sara's offer

There is only one way to discharge a contract-all parties must fulfill their contractual duties.

Megan contracts to sell Nonny her horse for $4,000. This contract will be fully discharged when Megan and Nonny

An accord and its satisfaction do not discharge an original contractual obligation.

Tender is an unconditional offer to perform by a person who is ready, willing, and able to do so.

A contract is substantially performed when one party receives most of the benefits promised in the deal.

Jason and Kelly enter into a contract for Jason to renovate Kelly's house by a certain date. Jason never performs. After the applicable limitations period has passed, Kelly decides to bring a suit against Jason for breach. This suit

Hilton enters into a contract to erect a fence around Irene's cattle pasture. When the fence is built, Hilton's performance will be

Restoration Inc. enters into a contract to refurbish an old bus depot for Quality Café LLC. If Restoration completes most of the work promised in the contract, its performance will be

Contractual obligations will be discharged if unforeseeable circumstances make it impossible to attain the deal's purpose.

East Bay Café orders seafood from Fresh Catch Company. Fresh places the goods at East's disposal. Fresh's performance under the contract is

Vera enters into a contract to work as a lifeguard at Water Park for the summer in exchange for a weekly paycheck. The duties under this contract will be discharged when the duties are

Discharging a contract by executing a new agreement with performance different from what was originally promised is

Build-It Construction LLC contracts to build a warehouse for Corporate Storage Inc. Corporate does not have to pay Build-It if the warehouse is not built. Their respective promises are

Adrian operates a recycled metals business and contracts to provide ten tons of scrap steel at $500 per ton to be delivered to Build-It-Rite Materials, Inc., in seven months. An unforeseen shortage of scrap steel suddenly develops, making it impossible for Adrian to fulfill the contract for less than $5,000 per ton. Adrian's best defense against performing the contract would be that

A statute of limitations limits the amount of damages that the nonbreaching party can obtain for a breach.