Bar Exam Bar Exam Remedies 1

Question 1

In a breach of contract action, expectation damages are designed to:

Accepted Answer

Place the plaintiff in the position they would have been in had the contract been fully performed

Answer

Expectation (benefit-of-the-bargain) damages compensate the non-breaching party for the economic equivalent of full performance, including lost profits.

Question 2

Consequential (special) damages in a contract action are recoverable under the rule of Hadley v. Baxendale only if they were:

Accepted Answer

Foreseeable as a probable result of breach at the time the contract was formed

Answer

Under Hadley v. Baxendale, consequential damages are recoverable only if they were foreseeable to the breaching party as a probable consequence at the time of contracting.

Question 3

The non-breaching party's duty to mitigate damages requires:

Accepted Answer

The non-breaching party to take reasonable steps to reduce losses after the breach

Answer

After a breach, the non-breaching party must take reasonable steps to avoid or reduce the resulting losses; unmitigated losses that could have been avoided are not recoverable.

Question 4

Reliance damages in a contract action are designed to restore the plaintiff to their:

Accepted Answer

Pre-contract position by reimbursing costs incurred in reasonable reliance on the contract

Answer

Reliance damages compensate the plaintiff for expenditures made in reliance on the defendant's promise by restoring the plaintiff to the pre-contract status quo.

Question 5

A liquidated damages clause in a contract is enforceable when:

Accepted Answer

The amount is a reasonable pre-estimate of anticipated harm and actual damages are difficult to calculate

Answer

A liquidated damages clause is enforceable only if it represents a genuine reasonable forecast of actual harm at the time of contracting and actual damages would be difficult to prove.

Bar Exam Practice Test

Bar Exam Practice Test

Bar Exam Bar Exam Remedies 1