OK Bar Performance 3 — Questions and Answers
Question 1: A farmer contracts to sell a specific identified crop from a named field, and the crop is destroyed by an unforeseeable flood before harvest. What is the likely result?
- The farmer's duty is discharged by impossibility/impracticability (Correct answer)
- The farmer must buy substitute crops on the open market
- The farmer is liable for full expectation damages
- The buyer may compel specific performance
Correct answer: The farmer's duty is discharged by impossibility/impracticability
Destruction of specifically identified subject matter essential to performance, without fault, discharges the duty under impossibility or impracticability doctrine.
Question 2: A city hires a contractor to build viewing stands for a parade that is later cancelled by an unforeseeable event. The stands could still be built. The contractor's best discharge argument is:
- Frustration of purpose (Correct answer)
- Impossibility of performance
- Mutual mistake
- Unconscionability
Correct answer: Frustration of purpose
Frustration of purpose applies when performance remains possible but an unforeseeable event destroys the shared, principal purpose of the contract.
Question 3: One month before performance is due, a seller unequivocally states, 'I will not deliver under any circumstances.' What may the buyer immediately do?
- Treat it as an anticipatory repudiation and sue at once, or await performance (Correct answer)
- Nothing until the performance date passes
- Only demand adequate assurances
- Rescind but never recover damages
Correct answer: Treat it as an anticipatory repudiation and sue at once, or await performance
An unequivocal repudiation before performance is due allows the nonbreaching party to sue immediately, suspend performance, or await the performance date.
Question 4: A party has reasonable grounds for insecurity about the other side's performance under a UCC sale. The proper step is to:
- Demand adequate assurance in writing and suspend performance if justified (Correct answer)
- Immediately terminate the contract
- Sue for anticipatory repudiation without more
- Withhold payment indefinitely without notice
Correct answer: Demand adequate assurance in writing and suspend performance if justified
The UCC permits a written demand for adequate assurance, and failure to provide it within a reasonable time (not exceeding 30 days) operates as a repudiation.
Question 5: A repudiating party attempts to retract the repudiation before the performance date. The retraction is effective unless:
- The other party has materially changed position or indicated the repudiation is final (Correct answer)
- The retraction is oral rather than written
- More than 48 hours have passed
- The contract involves goods over $500
Correct answer: The other party has materially changed position or indicated the repudiation is final
Repudiation may be retracted until the aggrieved party materially relies, accepts the repudiation as final, or sues, after which retraction is ineffective.
Question 6: A singer contracts to perform at a venue but dies before the concert. The singer's estate is:
- Discharged, because personal services contracts are excused by death of the performer (Correct answer)
- Liable for breach because death was foreseeable
- Required to hire a substitute performer
- Liable only for consequential damages
Correct answer: Discharged, because personal services contracts are excused by death of the performer
Death or incapacity of a party whose personal performance is essential discharges the contractual duty by impossibility.
Question 7: After a contract for the sale of goods is formed, a new regulation makes delivery illegal. The seller's duty is:
- Discharged by supervening illegality (Correct answer)
- Still enforceable with money damages
- Converted into a duty to deliver substitute goods
- Suspended for exactly one year
Correct answer: Discharged by supervening illegality
Supervening governmental regulation or law that makes performance illegal discharges the duty as a form of impossibility/impracticability.
OK Bar Performance 3
A farmer contracts to sell a specific identified crop from a named field, and the crop is destroyed by an unforeseeable flood before harvest.
What is the likely result?