CCNP Risk Assessment & Conflict Resolution 5

Question 1

A company discovers that its contract with a vendor does not include a data breach notification requirement. What category of risk does this represent?

Accepted Answer

Compliance and regulatory risk

Answer

Missing data breach notification requirements expose the company to violations of privacy regulations such as GDPR or CCPA, constituting compliance risk.

Question 2

Which conflict resolution approach is MOST appropriate when a long-term strategic partnership is more valuable than winning a specific contractual dispute?

Accepted Answer

Accommodation or collaboration

Answer

Accommodation or collaboration preserves the relationship by prioritizing the other party's needs or jointly finding mutually beneficial solutions over short-term positional wins.

Question 3

What is the primary purpose of including a 'dispute resolution ladder' in a contract?

Accepted Answer

To require parties to attempt progressively formal resolution methods before litigating

Answer

A dispute resolution ladder requires parties to first negotiate directly, then mediate, then arbitrate, saving litigation as a last resort and reducing resolution costs.

Question 4

When assessing counterparty risk in contract negotiations, which due diligence activity is MOST critical?

Accepted Answer

Analyzing the counterparty's financial statements, litigation history, and credit ratings

Answer

Financial statements, litigation history, and credit ratings provide the most direct evidence of a counterparty's ability and willingness to perform contract obligations.

Question 5

A contractor claims a change in law has made contract performance significantly more expensive. Under what legal doctrine might they seek contract relief?

Accepted Answer

Doctrine of frustration or commercial impracticability

Answer

Commercial impracticability (or frustration of purpose) may excuse performance when an unforeseen event, such as a new law, makes performance radically different from what was contracted.

(CCNP) Certified Contract Negotiation Professional Practice Test

(CCNP) Certified Contract Negotiation Professional Practice Test

CCNP Risk Assessment & Conflict Resolution 5