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Exam 12: Performance of a Contract

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Question 31

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Ernest operates an ice cream stand during the months of May, June, July, and August. Ernest's ice cream machine is broken and needs a new part to run. He contracts to have the part shipped to him by special carrier. Ernest emphasizes that the part needs to be delivered by April 25 and the carrier agrees, knowing that Ernest intends to open his stand May 1. If the shipper fails to deliver the part on April 25, Ernest will be able to recover consequential damages caused by the delay.

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Question 32

Multiple Choice

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Lawrence took out a life insurance policy in which his daughter, Madeline, is named as a beneficiary. Madeline is a(n)

A) promisor.
B) obligor.
C) intentional beneficiary.
D) incidental beneficiary.

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Question 33

Multiple Choice

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Generally, in comparison to a donee beneficiary, a creditor beneficiary has

Expectation interest can best be described as money spent in reliance upon the agreement.

Assignment is prohibited when the obligor is agreeing to perform personal services.

Martina hires Alexander to renovate her home and specifies that Alexander use Spiffy Painting for all the painting because of Spiffy's excellent reputation. In this case, Spiffy is a(n)

Char-Glo Industries contracted with Evergreen Lawn Service to mow and trim the company's lawn. In the contract, Char-Glo included a clause prohibiting Evergreen from delegating its duties. Courts will ordinarily not enforce such a clause.

Carlos is hired to paint a house for $700. Before he starts, the woman who hired Carlos tells him she does not want the job done after all. Carlos finds another house-painting job that afternoon, but it pays only $500. If Carlos sues the woman for damages and is awarded $200, that amount is an example of

In which case would true impossibility NOT apply?

Andrew Durham was injured in a job-related accident that resulted in a workers' compensation settlement agreement with the employer's insurance carrier, Traveler's Indemnity Company. The settlement agreement required Traveler's to pay Durham $2,500 per month for the rest of his life. To finance its obligation, Traveler's purchased an annuity in its name. The settlement agreement required Traveler's approval or written consent prior to an assignment of the annuity payments. Durham later decided to open a business and went to a credit union for a $214,000 loan. The credit union loaned the money, taking a security interest in Durham's monthly annuity payments. Traveler's consent was never secured. Discuss the conditions in which a right may not be assigned and assess if this was a valid assignment.

Norm and Frank have a legal contract that is silent with regard to an assignment of the contract. In order for Norm to assign all or part of his rights under a contract, Frank must grant such permission to Norm.

Cheryl enters into a contract with Gabe. In this contract, Cheryl asks Gabe to pay the money he owes her from the contract to her friend Leah because Leah is having financial troubles. Leah is

Larry wanted to buy a 1957 Cadillac once owned by Reggie Jackson. Larry entered into a contract with the owner agreeing to pay $102,000. The owner subsequently changed his mind. If Larry sues, what remedies are potentially available?

If Valley Bridge contracts with Rainbow Painters to paint a bridge and the contract requires that only Sherwin Williams paint be used, then Sherwin Williams, as third party beneficiary, will most likely be able to enforce the contract against either Valley Bridge or Rainbow Painters.

A third party beneficiary's status occurs

To win expectation damages, the injured party must prove the breach of contract caused damages that can be quantified with reasonable certainty.

Injunctions are frequently used by courts to force employees to complete their contractual obligations with their employers.

A party who benefits from the contract although the contract was not designed for that party's benefit is a(n)

Specific performance may be available for the breach of a contract to sell