Chapter 10 Multiple-choice questions

. A prohibitory injunction can be granted to prevent a future breach of contract. Where, however, a claimant wishes to compel a defendant to remedy an injury caused by a breach that has already occurred, the claimant must obtain a mandatory injunction.

True

False

. A non-breaching party is entitled to an order of specific performance once it proves that damages are an inadequate remedy for the other party's breach and where the contract is not one that cannot be specifically enforced.

True

False

. In relation to a claim for the contract price, which one of the following statements is false?

The claim is not subject to the test of remoteness.

The claim is not subject to the mitigation principle.

A liquidated damages clause in the contract does not apply to the claim.

The claim arises from a breach of contract by the defendant.

. Which of the following statements relating to enrichment by subtraction are true? [Please select all that apply.]

A party may recover money paid in anticipation of a contractual performance on the ground of total failure of consideration only when the other party has, in breach of the contract, totally failed to render the stipulated performance.

Where a party has received nothing under the contract but the other party has started performance, the first party is generally not able to recover any money paid in advance on the ground of total failure of consideration.

Where a supplier has fully performed its contractual obligation to provide a service under a contract with detailed contractual terms and the customer refuses to pay the fixed contract price, the supplier cannot claim a quantum meruit.

In some circumstances, even if there has been no breach of contract, a party may recover money paid in anticipation of a contractual performance that the other party has failed to provide.

. Where a promise to provide a service is given in exchange for a promise to pay a fixed price and the latter promise has been partly performed before any service is provided, there will be no total failure of consideration and thus no restitution of such payment is possible.

True

False

. Which one of the following statements most accurately describes the reason why an order of specific performance was granted by the House of Lords in Beswick v Beswick [1968] AC 58?

There was no substitution available for the nephew's performance under the contract.

The contract between the uncle and the nephew was one for the sale of land.

The uncle's estate suffered no loss from the nephew's breach of contract and was only entitled to nominal damages.

The uncle's estate was entitled to claim damages from the nephew but the damages were difficult to quantify.

. An account of profits is generally available as a remedy for a serious breach of contract.

True

False

. Where a claimant's loss or damage is difficult to measure and the claimant has a legitimate interest in preventing profit-making activity carried out in breach of contract, the claimant will be able, as a matter of principle, to elect a remedy based on an account of profits.

True

False

. Which one of the following remedies of specific relief is most likely to be granted?

An order of specific performance sought in the event of a photographic studio, in breach of its contractual obligation to deliver a customer's portrait photos taken during her birthday party, attempting to resell the photos to a third party.

An order of specific performance sought in the event of a breach by a supermarket of its contractual obligation to keep a leased property open for retail trade during the usual hours of business.

A mandatory injunction sought in the event of a breach by an employee of her obligation not to join the competitors of her employer within a certain period following the termination of that employment.

A prohibitory injunction sought in the event of a breach by an employer of its obligation not to employ anyone other than a specific person as its manager.

. Which of the following statements are consistent with the decision of the House of Lords in Attorney-General v Blake [2001] 1 AC 268? [Please select all that apply.]

The owner in Ruxley Electronics and Construction Ltd v Forsyth [1996] 1 AC 344 might recover from the constructor the latter's savings in costs in building the swimming pool in accordance with the decision in Attorney-General v Blake.

An account of profits for breach of contract was available only when the breach involved the use of, or interference with, a property interest of the non-breaching party.

One of the reasons for allowing an account of profits in that case was the deliberate and repeated breaches by the spy, which caused unquantifiable damages.

Even where a case fell within the 'exceptional circumstances' identified by the House of Lords, it was still a matter of the court's discretion whether an account of profits should be awarded.

. Where the buyer under a contract for the sale of specific goods indicates, before the date of delivery, that she no longer wishes to buy the goods, the seller is entitled only to claim damages and cannot claim the contract price.

True

False

. In which of the following situations is the court most likely to grant an order of specific performance? [Please select all that apply.]

A enters a contract to sell her detached house to B for £20 and then refuses to proceed with the deal. B applies for an order of specific performance.

A enters a contract to sell 1,000 tons of steel to B and then refuses to proceed with the deal. Because there is a worldwide shortage of steel, B applies for an order of specific performance.

A enters a contract to grant a lease to B in return for B's promise to repair the premises personally. When B has completed 80 per cent of the repair work, A refuses to proceed with the deal and denies B access to the premises. B applies for an order of specific performance.

A enters negotiations to sell his house to B and rejects an initial offer by B to buy the house for £200,000. B then receives a letter from A offering to sell for £120,000. B immediately accepts the offer and, when A refuses to sell the house at that price, applies for an order of specific performance.

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