First Principles of Business Law
Quiz: Remedies for breach of contract

Question 10

 

 

 

A, an importer of goods, agrees to sell 100 TVs to B, a retailer of electronic goods.  It is a term of the contract that A will inspect each TV for faults before delivering them to B.  B does not consider this promise to be fundamental to the contract, but he hopes it will minimise the delivery of defective TVs.  In the event, A delivers the first 50 TVs without inspecting them.  B wants to keep these TVs and will pay for them, but he also wants to stop any further performance of the contract with A.  Which of the following statements correctly describes whether, in these circumstances, B is entitled to terminate further performance of the contract?

 

(a) In this situation, B cannot stop further performance of the contract because, although there has been a breach of contract, it is only a breach of warranty and a breach of this kind does not justify termination.

(b) In this situation, B can stop further performance of the contract because there has been a breach of contract and any breach of contract gives the non-defaulting party the right to terminate performance of outstanding obligations.

(c) In this situation, B cannot stop performance of the rest of the contract because he wants to keep and pay for the TVs that A has already delivered and B cannot both enforce the contract and repudiate it at the same time.

 

 

 

 

 

 

 

 

 

 

  

 

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