Chapter 10

Question 1

fail to perform one’s duty under a contract

Answer 1

breach

Question 2

a party has performed the duties under the terms
of the contract exactly as specified

Answer 2

Complete performance

Question 3

a party has not provided complete performance but
has not committed a material breach

Answer 3

Substantial performance

Question 4

occurs when a party does not perform a significant duty under the contract

Answer 4

material breach

Question 5

a condition that must be satisfied before performance is required by another party under a contract

Answer 5

condition precedent

Question 6

a condition that requires performance until a condition is no longer satisfied

Answer 6

condition subsequent

Question 7

If both parties are subject to conditions, the existence of mutual conditions that must be performed simultaneously are referred to as

Answer 7

conditions concurrent

Question 8

a written or verbal condition stated as part of a contract

Answer 8

express condition

Question 9

a condition that is neither written nor oral but nonetheless exists as a part of the contract and can be inferred from the facts surrounding the contract

Answer 9

implied condition

Question 10

contains a reasonableness standard in regard to determining or judging when the condition has been met

Answer 10

objective condition

Question 11

determined to be satisfied by the subjective opinion of a party to a contract

Answer 11

subjective condition

Question 12

remedy that is generally non-monetary in nature

Answer 12

Equitable remedies

Question 13

meant to compensate or reimburse the plaintiff for what they have lost because of the breach of contract

Answer 13

Compensatory damages

Question 14

awarded to compensate the plaintiff for the direct and foreseeable loss caused by the breach of contract

Answer 14

general damages

Question 15

arise when the damages to be compen-sated are not normally foreseeable and thus require the defendant have received notice of the possibility for such damages

Answer 15

Special/Consequential damages

Question 16

the difference between the position where the plaintiff expected to be and where the plaintiff was left after the breach

Answer 16

Expectation damages

Question 17

compensate the plaintiff for expenses they have incurred by relying on the contract that was breached by the defendant

Answer 17

Reliance damages

Question 18

equal to the amount of value the defendant has received from the plaintiff

Answer 18

Restitution damages

Question 19

damages that are not meant to compensate a party for a loss suffered from the breach of contract but are instead designed to punish the breaching party for improper behavior

Answer 19

Punitive damages

Question 20

damages provided in a contract that are meant to compensate the non-breaching party in the event of a breach of contract

Answer 20

Liquidated damages

Question 21

a small amount of damages awarded in a contract breach case that are intended to establish liability on the part of the breaching party but not necessarily compensate the party for damages realized

Answer 21

Nominal damages

Question 22

means to do specifically as promised

Answer 22

Specific performance

Question 23

a court order that demands a defendant stop performing an action

Answer 23

injunction

Question 24

the act by which a court cancels or undoes a contract

Answer 24

Rescission

Question 25

an equitable remedy that a court uses to change or modify the terms to a contract

Answer 25

reformation

Question 26

a typographical error

Answer 26

scrivener’s error

Question 27

goods that meet the specifications of the contract

Answer 27

Conforming goods

Question 28

damages arising because of the breach of the seller and include costs such as shipping the goods back to the seller or having the goods inspected by a third party

Answer 28

Incidental damages

Question 29

damages that compensate the injured party for costs or lost profits caused because of the breach or damages and that the seller knew would result or had reason to know would result

Answer 29

Consequential damages

Question 30

occurs when a party to a contract informs the other party to a contract that it will be unable to perform under the terms of the contract

Answer 30

anticipatory repudiation

Question 31

a legal doctrine that discharges a party from their contractual duties if it is impossible to perform such duties and the difficulty was not foreseeable at the time of contracting

Answer 31

Objective impossibility

Question 32

a legal doctrine where a court discharges a party from their contractual duty because it is commercially impractical but not objectively impossible for the party to perform

Answer 32

Commercial impracticability

Question 33

a legal doctrine that discharges the duty of parties to perform where the original purpose of their contract can no longer be achieved

Answer 33

Frustration of purpose

Question 34

a party whom the original parties to a contract intend to benefit with their contract

Answer 34

intended beneficiary

Question 35

a party whom the original parties did not intend to benefit with their contract

Answer 35

incidental beneficiary

Question 36

owed performance by one of the parties because of a preexisting obligation owed to the intended beneficiary

Answer 36

Creditor beneficiaries

Question 37

are not owed a performance because of an existing duty but because a party to the contract has decided to provide them a benefit

Answer 37

Donee beneficiaries

Question 38

occurs when a party transfers its rights under a contract to a third party

Answer 38

assignment

Question 39

the party who transfers a right

Answer 39

assignor

Question 40

the party receiving the right

Answer 40

assignee

Question 41

a party who owes a performance under a contract

Answer 41

obligor

Question 42

the party who delegates a duty

Answer 42

delegator

Question 43

the party to whom a delegation of duty has been made

Answer 43

delegatee

Question 44

the person to whom a duty is owed

Answer 44

obligee

Question 45

clauses that attempt to limit the liability of a contractual party

Answer 45

Exculpatory clauses

Question 46

a contractual clause that excuses a party’s performance in the event a certain agreed-on event occurs that is out of the control of the parties

Answer 46

force majeure clause

Question 47

specifies the court forum that will hear a breach of contract dispute in the event one occurs

Answer 47

Choice of forum clause