Explanation

This is affirmation of the contract. When a breach occurs the injured party has two options; termi-nate the contract or affirm the contract. In this example they have affirmed the contract- they have chosen to continue working with the offending party. See p.60.

Explanation

The correct answers are as follows:

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This is a fundamental breach. The key here is the scenario says 'huge issue'. Out of the four scenarios this one is the most important / serious and therefore will be the fundamental breach.

Explanation

3 is the correct answer. This question is testing your understanding of 'consequential loss' which is explained on p.109. Consequential loss is where you can claim damages for incidental loss (loss that isn't a direct cause of the breach of the contract, such as future earnings). In this scenario the breach is the late delivery and the incidental damage is John not being able to sell any chocolate in his shop or make his Easter Eggs. There are questions like this in the real exam- remember to think what the textbook would say and don't overthink this. The scenario doesn't always give you a lot of information (for example this doesn't say if there is a contract in place) so think- which of these four options is the most logical and what is this question trying to test me on.

Explanation

A variation clause and signed agreement by both parties is required to make the change. See p.16-17 for more information on contract variations. Note a 'notification of change' isn't valid unless it's accepted by the other party- so it's a good idea for both parties to sign to say they agree to the change.

Explanation

The first stage is 'identify the nature and source of the conflict'. Stage 2 is assess the impact of the breach, stage 3 is look at remedies available and stage 4 is agree on a way forward and type of conflict resolution. These stages are explained on p.62 of the study guide.

Explanation

The correct answers are as follows:

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Subcontracting is the correct answer as they're using another company to fulfil the contract

Explanation

The correct answers are as follows:

This is arbitration as it involves a panel.

Explanation

The correct answers are as follows:

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This is payment terms- the clues here are 'financial' and 'progress payments'

Explanation

Where there's no order of precedence, it is assumed that all documents have equal significance. This is a direct quote from the study guide p.15

Explanation

Litigation is the most adversarial. It's usually the last resort and shouldn't be used if you want to preserve the working relationship. P. 145