Chapter 8 Multiple choice questions

. The performance of the contract must be exactly what is promised under the contract in order for the contract to be discharged by performance but there are some exceptions. Are these:
(a) Where there has been substantial performance of the contract.
(b) Where the contract is a divisible contract.
(c) Where one party is prevented by the other from completing the contract.
(d) Where partial performance of the contract is accepted by the other party.

(a) (b) and (c) only.

(b) and (d) only.

(a), (c) and (d) only.

(a) (b), (c) and (d).

. Drugs Ltd contracts with Supermarket Ltd to manufacture and supply 50 cases of a drug called SuperX. Supermarket Ltd pay the contract money, £5,000, to Drugs Ltd but before delivery takes place the Government introduces a law banning the manufacture and supply of SuperX. Can Supermarket Ltd enforce the contract?

No, the contract is frustrated.

No, there is a breach of contract.

Yes, because Supermarket Ltd has already paid the contract price of £5,000.

Yes, the contract was legal when it was made.

. The consequences of a contract being frustrated are governed by which Act?

The Law Reform (Frustrated Contracts) Act 1943.

The Frustrated Contracts Act 1943.

The Unfair Contract Terms Act 1977.

The Reform of Contracts Act 1977.

. Where there is an anticipatory breach of contract, when is the injured party first entitled to sue?

Only after a reasonable time.

From the date the other party indicates their intention not to complete the contract.

From the date that the other party fails to actually perform their part of the contract.

If it is an anticipatory breach of contract, the injured party has no right to sue for beach of contract.

. What is the aim of an award of damages for breach of contract?

To punish the party who has broken the contract.

To restore the innocent party to the position he was in before the contract was made.

To ensure the party who has broken the contract suffers a reasonable penalty.

To put the innocent party in the same financial position he would have been in if the contract had been carried out.

. The case of Hadley v Baxendale (1854) laid down:

Test of reasonableness.

Test of remoteness of damage.

Test of measure of damages.

Rules of specific performance.

. Which one of the following sentences is correct?

If a party has suffered no loss through a breach of contract, he will only be entitled to nominal damages.

Damages can never be claimed for distress or disappointment.

A claimant can claim for all losses that have occurred through breach of contract.

A claimant generally has no duty to mitigate his loss.

. Which one of the following statements is false?

Specific performance is an equitable remedy.

Specific performance is a court order to the party in breach of contract to perform his obligations under the contract.

Where damages would be an adequate remedy specific performance will not be granted.

Specific performance may be awarded if one party fails to carry out his contract of employment.

. Where a contract states the sum to be paid in the event of a breach of contract, the stated sum is known as:

Unliquidated damages.

Liquidated damages.

Contract sum.

Stated damages.

. Which of the following is a common law remedy?

Injunction.

Specific performance.

Damages.

Penalty.

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