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McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
True/False Questions
1) In the context of contractual damages, there is only one measure of relief.
a. True
b. False
2) While damages in tort are always backward-looking, damages in contract are always
forward-looking.
a. True
b. False
3) Because of the need for commercial certainty, a court will award expectation damages
only if the value of the plaintiff's loss can be calculated with precision.
a. True
b. False
4) Penelope contractually agreed to repair Don's roof with a specific type of tile for a price
of $10 000. After she completed the job, Don noticed that she had not used the type of tile
that was required by the contract. She had used a lower grade of tile. Consequently, Don's
roof was worth $3000 less than he had expected. It will cost $5000 to remove the tiles that
Penelope used and to put the proper type of tiles in their place. If a court awards cost of
cure damages to Don, he will be required to use that money to actually replace the existing
tiles with the tiles that he expected to receive under his contract with Penelope.
a. True
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
b. False
5) Dina entered into a contract with George. She agreed to decorate his office and he agreed
to pay her $10 000. She spent $3000 performing her obligations under the agreement. He
has paid her $2000, but refuses to pay any more. Under the concept of reliance damages,
George must now pay $8000 to Dina.
a. True
b. False
6) On June 1, Sergei contractually agreed to purchase a widget from Marisa. The total price
was $15 000. Sergei paid $5000 immediately and promised to pay the remainder upon
delivery. Although Marisa was required to deliver on July 15, she refused to do so. The
market value of the widget was $15 000 on June 1, but $22 000 on July 15. Sergei is
entitled to receive $12 000 in expectation damages.
a. True
b. False
7) On October 15, Madeleine contractually agreed to sell a widget to Hugh. The total price
was $20 000. Hugh paid $4000 immediately and promised to pay the remainder upon
delivery. Madeleine delivered the widget to Hugh on November 2, as required by the
contract. He refused to accept it, however, because its market value had dropped from $20
000 to $10 000. Madeleine is entitled to receive $6000 in expectation damages.
a. True
b. False
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
8) On March 26, Sanjeev agreed to sell a widget to Anita for $50 000. She paid $10 000
immediately and promised to pay the remainder when he made delivery on August 30.
Sanjeev breached the contract, however, by refusing to deliver the widget. On August 30,
its market value had dropped to $47 000. Anita cannot recover expectation damages, but
she can recover a maximum of $3000 in reliance damages.
a. True
b. False
9) On September 1, Mira agreed to sell a shipment of beans to Marco for a total price of
$20 000. He paid the price immediately and the contract required her to make delivery on
December 1. She failed to do so. By that time, the market value of the beans had increased
to $27 000. Although Marco could have arranged to receive a shipment of beans from
another supplier almost immediately, he actually waited three weeks before entering into
such a contract with Hector. By that time, the market value of the beans had increased to
$30 000. Marco is entitled to expectation damages of $30 000 as long as a reasonable
person could have predicted the full price increase on December 1.
a. True
b. False
10) The courts often award cost of cure damages in order to punish the defendant for acting
outrageously.
a. True
b. False
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
11) Imran contractually agreed to sell a widget to Juanita for a total price of $200 000.
Juanita paid $50 000 immediately and promised to pay the remainder upon delivery.
However, Imran refused to ever deliver a widget. Between the time that the contract was
created and the time of breach, the value of the widget dropped from $200 000 to $100 000.
Juanita nevertheless is entitled to get back her payment of $50 000.
a. True
b. False
12) A court will award punitive damages only if the plaintiff is not entitled to expectation
damages.
a. True
b. False
13) Brown's Construction Co agreed to renovate a lecture hall at Moosehead University.
The contract required the work to be done between July 1 and September 1 so that classes
would not be disrupted. The contract also stated that Brown's would be required to pay the
university $10 000 per week for each week that the work ran over schedule. That part of the
contract was intended to allow Moosehead to rent other premises for the purpose of holding
class off-campus in the event of a delay as a reasonable pre-estimate of liquidated damages.
In fact, the project was finished six weeks late. Because of an unexpected downturn in the
economy, however, the university only had to pay a total of $20 000 to hold classes off-
campus during the delay. Brown's Construction nevertheless may be required to pay $60
000.
a. True
b. False
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
14) If defendants in a private law case refuse to obey orders for specific performance, they
can be sent to jail for contempt of court.
a. True
b. False
15) If the plaintiff proves an enrichment, a corresponding deprivation, and a juristic reason
for the enrichment, it will normally be entitled to the remedy of restitution.
a. True
b. False
Multiple Choice Questions
1) Susan contractually agreed to sell a particular computer to Davor for $5000. Although
Davor paid the money, Susan refuses to actually give him the computer. A court will likely
award monetary damages, rather than specific performance, to Davor because
a. judges do not have the authority to force the defendant to act in a particular way.
b. Davor has already paid the purchase price.
c. Susan has not committed a serious breach of contract.
d. monetary damages will provide Davor with an adequate remedy.
e. the loss of the computer is too remote.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
2) Savannah agreed to buy a car from Rhett for $10 000. Savannah paid the price, but Rhett
refused to perform the contract after he discovered that the vehicle was really worth $17
000. At the time that the contract was created, neither he nor Savannah was aware of the
vehicle's actual value. Which of the following statements is TRUE?
a. The court will likely award expectation damages based on the profit that Rhett expected
to receive under the contract.
b. The court will likely award specific performance because of the significant difference
between the contract price and the actual value of the car.
c. Savannah cannot get expectation damages for $17 000 because she did not expect to
receive a car of that value when she entered into the contract.
d. Savannah will be entitled to receive a total of $7000 in expectation damages because that
is the profit that she should have received under the contract.
e. Even though he breached the contract, Rhett may not be liable for the full difference
between the contract price and the market value if Savannah could have purchased a similar
car from a third party for less than $17 000.
3) Which of the following statements is TRUE?
a. Damages in contract are always forward-looking.
b. Damages in contract are always backward-looking.
c. In deciding whether or not damages in contract should be forward-looking or backward-
looking, a court will be influenced by whether or not the defendant's breach was deliberate.
d. Damages in contract are usually forward-looking because the courts want to protect the
fact that promises are valuable only if they will be kept in the future.
e. Expectation damages compensate the plaintiff for expenses that it actually paid in
reliance upon the contract.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
4) Luis contractually agreed to sell a widget to Monica for $20 000. Monica accepted
delivery of the widget, but has paid only $13 000. Although neither party realized it when
they created their contract, the widget is actually worth $23 000. A court will order Monica
to pay Luis
a. $10 000.
b. $7000.
c. $20 000.
d. $13 000.
e. $23 000.
5) Joshua contractually agreed to sell a widget to Maya for $50 000. Before the sale was
completed, however, Maya announced that she no longer wanted the widget. She therefore
refused to accept delivery of it or to make any payment. The widget is really worth $55
000. There are several other parties who are willing to buy it from Joshua at that price. At
the time of entering into his contract with Maya, however, Joshua thought that the widget
was worth $60 000. He therefore thought that he would earn a profit of $10 000 under the
contract. A court will order Maya to pay Joshua
a. $5000.
b. $50 000.
c. $10 000.
d. $55 000.
e. $1.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
6) Armand contractually agreed to sell a widget to Melanie for $100 000. However, she
refused to accept delivery of the widget or to pay the contract price because the widget is
really worth $80 000. Britt then offered to buy the widget from Armand for $80 000, but he
rejected that offer. If Armand claims expectation damages, a court will order Melanie to
pay him
a. $100 000.
b. $20 000.
c. $40 000.
d. $80 000.
e. $0.
7) The victim of a breach of contract is entitled to
a. claim expectation damages for remote losses.
b. enforce a contractual term regarding liquidated damages but not penalties.
c. compel the party in breach to mitigate the losses.
d. insist upon receiving cost of cure damages.
e. recover damages for intangible losses only if the defendant deliberately breached the
contract.
8) The monetary value of expectation damages may be affected by
a. the concept of disgorgement.
b. the concept of esperanto.
c. the profit that the defendant unreasonably expected to receive under the contract.
d. the money that the party in breach saved as a result of the breach.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
e. the fact that some of the plaintiff's losses are intangible.
9) Which of the following statements is TRUE?
a. Cost of cure damages will never be awarded unless the plaintiff has already spent money
to cure the defect in the defendant's performance.
b. Cost of cure damages will always be less than loss of value damages.
c. Cost of cure damages will always be awarded if the plaintiff's only loss is intangible.
d. Cost of cure damages are more likely to be awarded if the innocent party has a
reasonable and legitimate reason for wanting to have a defect actually cured.
e. Cost of cure damages are a form of reliance damages.
10) Woody entered into a contract with Jezebel. She promised to pay $10 000 and he
promised to build a sun deck in her backyard. The contract contained specific terms
regarding the quality of the materials that Woody would use. Woody built a sun deck, but
many of the materials that he used fell below the standard required by the contract. As a
result of that breach, the deck is worth $1000 less than Jezebel expected. It will cost $9000
to replace the defective materials with materials that satisfy the terms of the contract.
Which of the following statements is TRUE?
a. A court will certainly award cost of cure damages if Woody deliberately used materials
that did not satisfy the terms of the contract.
b. A court will probably refuse to award cost of cure damages because the difference
between the loss of value and the expense of repairing the defect is very large.
c. If Jezebel is awarded cost of cure damages, she must use that money to cure the defect.
d. Cost of cure damages are classified as a form of punitive damages because they often
require the defendant to pay for more than the plaintiff's actual loss of value.
e. If Woody deliberated breached the contract by using inferior materials, Jezebel will
receive total damages worth $18 000.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
11) An intangible loss
a. is a loss that has market value.
b. traditionally resulted in expectation damages.
c. usually triggers the remedy of an account of profits.
d. usually leads to reliance damages.
e. may be the subject of damages if the contract was intended to provide "peace of mind" to
the plaintiff.
12) Harold agreed to sell a widget to Sheila for $10 000. Sheila paid the purchase price
immediately and Harold was required to deliver the widget on June 1. In fact, Harold did
not deliver the widget until June 21. As a result, Sheila was unable to perform a contract for
ABC Inc. on June 19 that would have paid her $15 000. Which of the following statements
is TRUE?
a. Sheila is entitled to recover $15 000 in damages from Harold as long as she knew, or
should have known, that late delivery would cause her to lose her contract with ABC Inc.
b. Sheila's loss of $15 000 is best described as an intangible loss.
c. Sheila is liable to Harold for $15 000 as long as he knew, or should have known, of the
possibility of that loss when he breached the contract.
d. Damages will be reduced to the extent that Harold failed to mitigate the loss that was
caused by the breach.
e. Depending upon the facts, Sheila's damages may be reduced on the basis of both the
concept of remoteness and the concept of mitigation.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
13) The concept of remoteness
a. allows recovery for losses that were not reasonably foreseeable.
b. is related to the risks that the parties accepted when they created their contract.
c. always applies if the plaintiff mitigated the loss that was caused by the defendant's
breach.
d. is based on facts that the defendant knew, or should have known, at the time of
committing the breach of contract.
e. applies only if the plaintiff's loss was caused by a combination of the defendant's breach
and the actions of a third party.
14) Widgets are manufactured by very few companies and they are often difficult to locate.
On January 1, Alpha Corp contractually agreed to sell a widget to Beta Inc. Beta paid the
total purchase price of $30 000 immediately. The contract required Alpha to deliver the
widget on April 1. On March 25, Alpha contacted Beta and announced that it would not be
able to deliver the widget. By that time, the cost of a widget had increased to $50 000. On
March 28, Beta paid $2000 to an independent firm to locate an alternative widget supplier.
That firm suggested Gamma Ltd. On March 30, Beta paid $50 000 to Gamma Ltd to deliver
a widget by April 1. A court would probably order Alpha to pay Beta
a. $2000.
b. $82 000.
c. $22 000.
d. $50 000.
e. $30 000.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
15) On June 1, Lauto Inc contractually agreed to buy a Pupmobile LX from Dos Motors
Ltd for $25 000. Payment of the price and delivery of an appropriate vehicle were
scheduled to occur on July 15. On July 1, however, Dos informed Lauto that it had
carelessly crushed its only Pupmobile LX with an industrial-sized garbage bin. Dos
apologized profusely and explained that it did not have another one in stock. It also
informed Lauto that, because a Pupmobile LX had recently appeared in a highly successful
movie, such cars were in great demand. "If you still want one," said the manager at Dos,
"you had better act quickly. I'll expect that they will start to go up in value very quickly."
Between July 1 and July 10, Lauto could have agreed to purchase a Pupmobile LX from
another dealer for $30 000. Nevertheless, Lauto waited until July 11 before buying a
Pupmobile LX from Tertius Motors Ltd for $35 000. By July 15, the market value of such
vehicles had increased to $40 000. A court would probably order Dos to pay Lauto
a. $15 000.
b. $10 000.
c. $25 000.
d. $5000.
e. $30 000.
16) Dave was contractually required to deliver a widget to Pam by July 1. He failed to do
so. At that point, Pam predicted that she would suffer a loss of $100 000 during the next six
months because her factory cannot operate efficiently without a widget. Which of the
following statements is TRUE?
a. Because she is under a duty to mitigate, Pam cannot receive any damages unless she
purchases a widget from another supplier.
b. Because she is under a duty to mitigate, Pam must do everything possible to acquire a
widget from another supplier.
c. Because he is under a duty to mitigate, Dave will be held liable for $100 000 unless he
takes reasonable steps to help Pam purchase a widget from another supplier.
d. Because Dave is under a duty to mitigate, the damages that he must pay will be reduced
to the extent that he reasonably spends money trying to help Pam purchase a widget from
another supplier.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
e. Because she is under a duty to mitigate, Pam will be denied damages to the extent that
she could reasonably avoid a loss flowing from Dave's breach.
17) Alexi agreed to sell a particular type of car to Carole for $15 000. He breached the
contract by refusing to deliver the car and complete the sale. She bought another car of the
same type from Ivan for $18 000. These facts most clearly illustrate the concept of
a. remoteness.
b. mitigation.
c. cost of cure.
d. loss of value.
e. intangible losses.
18) Shinji contractually agreed to record a concert for Keith. The concert was to occur on
November 8 and Keith was to pay a price of $10 000 on the same day. On October 15,
Shinji informed Keith that he would not be able to record the concert. On November 2,
Keith entered into a contract with his good friend, Manfred. Under the terms of that
agreement, Manfred was required to record the concert on November 8 and Keith was
required to pay $25 000. The evidence indicates that Keith could have easily hired someone
other than Manfred for $17 000. Which of the following statements is TRUE? A court
would probably order Shinji to pay Keith
a. $25 000.
b. $17 000.
c. $15 000.
d. $10 000.
e. $7000.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
19) Sammy Productions Inc wanted to hold an open-air concert on September 30. On
February 1, it entered into a contract with Maxine, a wealthy landowner. Under the terms of
that agreement, Maxine agreed to let the concert be held on her property and Sammy agreed
to pay her 10 percent of its gross revenues from the concert. The parties agreed to set the
price in that way because they did not have any way of knowing how many people would
attend the concert. Attendance would depend upon a large number of factors, including the
weather and the general state of the economy. Based on past experience, however, Sammy
and Maxine agreed that the event would certainly be profitable. After signing its contract
with Maxine, Sammy spent $75 000 on advertising. It also passed up an opportunity to
organize a Canada Day celebration in Ottawa, for which it would have received $100 000
in net profits from the government of Canada. Maxine was aware that Sammy sacrificed
that opportunity. On August 1, however, Maxine abruptly announced that she would not
allow the concert to be held on her land. She offered Sammy $50 000 as compensation for
its losses. It is not possible for Sammy to arrange another site for its concert given the late
date. A court would most likely order Maxine to pay Sammy
a. $50 000.
b. $100 000.
c. $75 000.
d. $175 000.
e. $0.
20) Which of the following statements is TRUE?
a. If a court awards nominal damages, it will always award costs against the party that
breached the contract.
b. Canadian judges award punitive damages more often than American judges.
c. Nominal damages are usually worth more than punitive damages.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
d. Punitive damages are intended to compensate the plaintiff for losses that it unexpectedly
suffered as a result of the defendant's breach of contract.
e. An account of profits normally is not available even if the defendant earned a large profit
as a result of committing a breach of contract against the plaintiff.
21) Brianna contractually agreed to sell a widget to Oren. She was required to deliver the
item on June 1 and he was required to pay $75 000 on the same day. Paragraph 21 of the
contract said that if Brianna breached the contract by refusing to deliver the item, Oren
would be entitled to a payment of $20 000. Brianna did, in fact, refuse to deliver the
widget. Oren therefore has not yet paid the price. Which of the following statements is
TRUE?
a. If Oren suffered a loss of $15 000 as a result of Brianna's breach, he will be entitled to
payment of that amount if paragraph 21 of the contract was a penalty.
b. If Oren suffered a loss of $10 000 as a result of Brianna's breach, he will be entitled to
payment of $20 000 if paragraph 21 of the contract was a penalty.
c. If Oren suffered a loss of $30 000 as a result of Brianna's breach, he will be entitled to
payment of that amount if paragraph 21 of the contract was for liquidated damages.
d. If Oren suffered a loss of $10 000 as a result of Brianna's breach, he will be entitled to
payment of that amount and no more if paragraph 21 of the contract was for liquidated
damages.
e. If Oren suffered a loss of $20 000, and the court classified paragraph 21 as liquidated
damages, then Brianna would be liable to pay $95 000.
22) Which of the following statements is TRUE?
a. Liquidated damages are always available if the defendant breached a contract for the sale
of land.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
b. Liquidated damages are enforceable if they represent a genuine estimate of the losses
that the plaintiff might have suffered as a result of the defendant's breach.
c. The plaintiff can recover more than a liquidated damages clause provides for if it
suffered a larger loss as a result of the defendant's breach.
d. The plaintiff cannot recover the full amount of liquidated damages if it suffered a smaller
loss as a result of the defendant's breach.
e. Because of the risk of unfairness, liquidated damages are never allowed unless the
defendant received independent legal advice at the time that the contract was created.
23) Mayo committed a breach of contract against Dirk. After ordering Mayo to compensate
Dirk for the losses that he suffered, the judge also ordered Mayo to pay an additional $10
000 to Dirk. These facts most likely demonstrate the concept of
a. nominal damages.
b. liquidated damages.
c. a penalty clause in the contract.
d. punitive damages.
e. equitable relief.
24) As a general rule, punitive damages will not be awarded for a breach of contract unless
a. monetary damages would not adequately compensate the plaintiff.
b. the plaintiff committed an independently actionable wrong.
c. the contract expressly allows for such relief.
d. the plaintiff seeks equitable relief.
e. the defendant is guilty of breaching at least two obligations.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
25) Katarzyna contractually agreed to sell a painting to Trent. She promised to deliver it on
June 1 and he promised to pay $10 000 on the same day. On May 15, Katarzyna discovered
that the painting is really worth $25 000. She therefore has told Trent that she does not
intend to fulfill the contract. Which of the following statements is TRUE?
a. Since specific performance is an equitable remedy, Trent is entitled to receive the
painting only if he agrees to pay $25 000 to Katarzyna.
b. Trent is not entitled to an order for specific performance because a court will not force
Katarzyna to act in any particular way.
c. If specific performance is not available, Trent will probably be entitled to receive $25
000 from Katarzyna.
d. A court will probably give Trent specific performance and reliance damages.
e. Trent probably is not entitled to specific performance if Katarzyna is under the age of
majority.
26) Which of the following statements is TRUE?
a. A court will refuse to award specific performance if monetary damages are inadequate.
b. The requirement of mutuality means that specific performance will not be awarded
unless both parties provided consideration under a contract.
c. Specific performance is not available if the defendant has "dirty hands" when it comes to
court.
d. Because it is an equitable remedy, specific performance is always available even if the
plaintiff waits a long time before suing the defendant.
e. Although the courts traditionally awarded specific performance for a contract to sell a
piece of land, the plaintiff will now receive damages unless a piece of land is somehow
special or unique.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
27) Iago contractually agreed to sell a particular piece of land to Desdemona. He later
changed his mind and decided to keep the property for himself. Which of the following
statements is TRUE?
a. A court would not award an order for specific performance because it would not be
willing to supervise the transfer of land.
b. Since the contract dealt with a sale of land, Desdemona will certainly receive an order for
specific performance.
c. Desdemona probably is not entitled to an order for specific performance if the land is not
unique or special.
d. Desdemona will be entitled to receive an order for specific performance only if she
grants an injunction to Iago.
e. Desdemona will receive specific performance only if Iago comes to court with unclean
hands.
28) Silvio agreed to perform as a pianist with the Moose Jaw Symphony Orchestra (the
MJSO). His contract with the orchestra contained two important clauses. One required him
to perform with the MJSO four times per month for three years. The other prohibited him
from "acting in any musical capacity for any other employer" during the same period. After
a short time, Silvio grew dissatisfied with the MJSO. He therefore announced his intention
to quit the MJSO and to join the Thunder Bay Orchestra (the TBO). Which of the following
statements is TRUE?
a. Because Silvio has special skills, a court would certainly grant an order of specific
performance to the MJSO.
b. Silvio is entitled to quit the MJSO and join the TBO because a contract for personal
services is never enforceable.
c. A court might grant an injunction to the MJSO to prevent Silvio from performing for the
TBO if it is reasonably possible for Silvio to earn a living without violating the terms of his
contract.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
d. Since an injunction is an equitable remedy, such relief is available only if the contract
between Silvio and the MJSO was under seal.
e. A court would not grant either specific performance or an injunction because the
requirement of mutuality could not possibly be satisfied on the facts.
29) Eleni agreed to act as an investment adviser for Gnuhigh Ltd. After completing her first
project for Gnuhigh, she asked for payment of $10 000, as calculated under the terms of the
parties' agreement. Gnuhigh refused to pay. In support of its position, it pointed to the
Financial Industry Standards Act, which says that a contract for investment advice is
unenforceable unless it is registered with a government official. The agreement between
Eleni and Gnuhigh is not registered. Eleni is most likely entitled to receive
a. $10 000 as restitution for unjust enrichment.
b. $10 000 as reliance damages.
c. $10 000 as liquidated damages.
d. $10 000 as expectation damages.
e. an order for specific performance.
30) Manny contractually agreed with Akio Inc to present a series of ten lectures to that
company's employees. The total price of $5000 was to be paid after the last lecture. The
work turned out to be far more complicated and far more expensive than Manny first
expected. He nevertheless carried on with the agreement because he did not want to
damage his reputation for reliability and professionalism. Manny spent $12 000 preparing
and delivering five lectures. It would have cost the same amount to prepare and deliver the
remaining lectures. At that point, however, Akio breached the contract and prevented
Manny from completing the contract. Which of the following statements is TRUE?
a. Manny is entitled to receive $5000 as expectation damages.
b. Manny is entitled to receive $12 000 as reliance damages.
McInnes/Kerr/VanDuzer: Managing the Law: The Legal Aspects of Doing Business, Fourth Edition
Chapter 12: Contractual Remedies
c. Manny is entitled to receive an order for specific performance.
d. Manny is entitled to receive $12 000 as restitution.
e. Manny is not entitled to any remedy.
31) Which of the following sets of remedies are both equitable?
a. punitive damages and nominal damages
b. restitution and punitive damages
c. specific performance and injunction
d. liquidated damages and rescission
e. account of profits and reliance damages
32) Which of the following concepts limits the availability of specific performance?
a. mutuality
b. remoteness
c. mitigation
d. penalty
e. cost of cure
33) Which of the following statements is TRUE with respect to reliance damages?
