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Question 1
On May 1st, Howard and College Painters, Inc. enter into a contract under which College Painters will paint Howard's house and Howard will pay the company $10,000. Howard specifies in the contract that he wants Dutchman brand Grade A light blue paint used on his house and nothing else. The contract calls for the work to begin on May 15th and conclude on May 30th. On May 8th, the federal government bans the use of Dutchman Grade A light blue paint because of high levels of lead in the paint. When May 15th comes around, the company does not begin working and Howard sues for breach of contract. Howard will win:
Correct
Incorrect!
Correct The general rule is that performance of a contract will be excused if the performance is made impracticable by an occurrence that neither party to the contract anticipated. One type of impracticability is where the subject of a contract becomes illegal before the date of performance. In such an instance, performance is excused. Here, the paint to be used in the contract became illegal before performance was due. That being the case, the Company is excused from the contract and FALSE is the correct answer.
Incorrect! The general rule is that performance of a contract will be excused if the performance is made impracticable by an occurrence that neither party to the contract anticipated. One type of impracticability is where the subject of a contract becomes illegal before the date of performance. In such an instance, performance is excused. Here, the paint to be used in the contract became illegal before performance was due. That being the case, the Company is excused from the contract and FALSE is the correct answer.
Question 2
On May 1st, Howard and College Painters, Inc. enter into a contract under which College Painters will paint Howard's house and Howard will pay the company $10,000. The contract calls for the work to begin on May 15th and conclude on May 30th. On May 8th, Howard's house is struck by lightning in a storm and burns down. On May 15th, the company comes to begin work but is unable to because the house has been destroyed. The company demands to get paid anyway and Howard refuses. If the company sues Howard for breach, Howard will win:
Correct The general rule is that performance of a contract will be excused if the performance is made impracticable by an occurrence that neither party to the contract anticipated. One type of impracticability is where the subject matter of the contract is destroyed. In such a case, the duty to perform is excused. Here, the subject of the contract, Howard's house, is destroyed. That being the case, the Company cannot paint it and Howard is excused from paying them. That being the case, TRUE is the correct answer.
Incorrect! The general rule is that performance of a contract will be excused if the performance is made impracticable by an occurrence that neither party to the contract anticipated. One type of impracticability is where the subject matter of the contract is destroyed. In such a case, the duty to perform is excused. Here, the subject of the contract, Howard's house, is destroyed. That being the case, the Company cannot paint it and Howard is excused from paying them. That being the case, TRUE is the correct answer.
Correct
Incorrect!
Question 3
Howard commissions the Lyons construction company to build him a house. Under the contract, Howard will pay Lyons $1 million and Lyons will build the house exactly according to Howard's specifications. Lyons has completed 75% of the house when it is struck by lightning during a storm and burns down. Howard demands that Lyons rebuild the house and Lyons demands to be paid for the work he has already done before he begins rebuilding. Howard refuses to pay Lyons anything and sues Lyons for breach. Howard will probably:
Correct
Incorrect!
Correct The general rule is that the destruction of a partially built building does not excuse the contractor's performance. In other words, the building being destroyed does not represent impracticability because the construction company can start over. In fact, if the construction company does not begin building again, they will be in breach of the contract. In addition, if the contractor refuses to rebuild, he will not be entitled to collect for the work he had completed before the building was destroyed. That being the case, Howard will be able to recover damages from Lyons if they do not rebuild and, if Lyons does not rebuild, Howard will not have to pay them for the work they did before the house was destroyed. Therefore, B is the correct answer.
Incorrect! The general rule is that the destruction of a partially built building does not excuse the contractor's performance. In other words, the building being destroyed does not represent impracticability because the construction company can start over. In fact, if the construction company does not begin building again, they will be in breach of the contract. In addition, if the contractor refuses to rebuild, he will not be entitled to collect for the work he had completed before the building was destroyed. That being the case, Howard will be able to recover damages from Lyons if they do not rebuild and, if Lyons does not rebuild, Howard will not have to pay them for the work they did before the house was destroyed. Therefore, B is the correct answer.
Correct
Incorrect!
Correct
Incorrect!
Question 4
Howard commissions the Lyons construction company to do extensive repairs on the wiring, plumbing and shingling of his house. Under the contract, Howard will pay Lyons $100,000 for the repair work. Lyons has completed 75% of the repairs when the house is struck by lightning during a storm and burns down. Because Lyons never finished the repairs, Howard refuses to pay Lyons anything. Lyons sues Howard for breach of contract. Howard will probably:
Correct
Incorrect!
Correct
Incorrect!
Correct
Incorrect!
Correct If a contractor is supposed to repair a building and the building is destroyed after he begins performance, the contractor's duty to perform is excused and he will be able to recover for whatever work he had completed before the destruction of the building. That being the case, Howard will have to pay Lyons for the work he did before the house was destroyed and D is the correct answer.
Incorrect! If a contractor is supposed to repair a building and the building is destroyed after he begins performance, the contractor's duty to perform is excused and he will be able to recover for whatever work he had completed before the destruction of the building. That being the case, Howard will have to pay Lyons for the work he did before the house was destroyed and D is the correct answer.
Question 5
Howard commissions the Lyons construction company to build him a house. Under the contract, Howard will pay Lyons $1 million and Lyons will build the house exactly according to Howard's specifications. One week before Lyons is supposed to start work, he falls off a scaffolding and is severely injured. After several months, Lyons recovers and signs a contract to work on a different house. Lyons contacts Howard and informs him that he will not be able to build a house for him. If Howard sues Lyons for breach, Howard will probably:
Correct Where contracts for personal services are concerned and one of the parties to the contract either dies or becomes incapacitated, both parties are excused. However, where the impracticability is only temporary, the parties are not excused from performance. Rather, the promisor's duty is temporarily suspended while the impracticability continues. Once the impracticability passes, the duty reattaches but only if performance would not increase the burden on either party or make the performance different from what was originally promised. Here, the impracticability was only temporary and building the house would not impose any undue burden on Lyons. That being the case, Howard will recover from Lyons and A is the correct answer.
Incorrect! Where contracts for personal services are concerned and one of the parties to the contract either dies or becomes incapacitated, both parties are excused. However, where the impracticability is only temporary, the parties are not excused from performance. Rather, the promisor's duty is temporarily suspended while the impracticability continues. Once the impracticability passes, the duty reattaches but only if performance would not increase the burden on either party or make the performance different from what was originally promised. Here, the impracticability was only temporary and building the house would not impose any undue burden on Lyons. That being the case, Howard will recover from Lyons and A is the correct answer.
Correct
Incorrect!
Correct
Incorrect!
Correct
Incorrect!
Question 6
Howard commissions the Lyons construction company to build him a house. Lyons calculates that, between labor and supply costs, it will cost $700,000 to build the house. Under the contract, Howard agrees to pay Lyons $1 million and Lyons will build the house exactly according to Howard's specifications. One week before Lyons is supposed to start work, he falls off a scaffolding and is severely injured. After several months, Lyons recovers. However, by this time, supply costs have increased to the point where building Howard's house will cost $1.2 million. Lyons contacts Howard and informs him that he will not be able to build a house for him. If Howard sues Lyons for breach, Howard will probably:
Correct
Incorrect!
Correct
Incorrect!
Correct
Incorrect!
Correct Where contracts for personal services are concerned and one of the parties to the contract either dies or becomes incapacitated, both parties are excused. However, where the impracticability is only temporary, the parties are not excused from performance. Rather, the promisor's duty is temporarily suspended while the impracticability continues. Once the impracticability passes, the duty reattaches but only if performance would not increase the burden on either party or make the performance different from what was originally promised. Here, the impracticability was only temporary but, because of the rise in costs, building the house now would impose an undue burden on Lyons. That being the case, Howard will not be able to recover from Lyons and D is the correct answer.
Incorrect! Where contracts for personal services are concerned and one of the parties to the contract either dies or becomes incapacitated, both parties are excused. However, where the impracticability is only temporary, the parties are not excused from performance. Rather, the promisor's duty is temporarily suspended while the impracticability continues. Once the impracticability passes, the duty reattaches but only if performance would not increase the burden on either party or make the performance different from what was originally promised. Here, the impracticability was only temporary but, because of the rise in costs, building the house now would impose an undue burden on Lyons. That being the case, Howard will not be able to recover from Lyons and D is the correct answer.