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MMLU / A contractor agreed with a city government to build it a bridge. The contractor…

Problem

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question

A contractor agreed with a city government to build it a bridge. The contractor was guilty of undue delay in getting the bridge construction finished. The contract had a liquidated damages clause that provided for a deduction from the contract price for each day of delay in completing the bridge. The formula for the deductions from the contract price was based on how much traffic flow was turned away. The city tried to deduct the damages from the contract price. The contractor, however, pointed out that the city had not yet connected a road to the bridge so that there was no traffic flow and hence no damage to the city. Will the court uphold the liquidated damages clause in favor of the city?

choices

  1. No, because the city's failure to perform has frustrated the purpose of the liquidated damages clause, making liquidated damages in this case unnecessary due to no damages suffered.
  2. Yes, because the contract provision for liquidated damages has been breached and the city had no obligation to connect a road.
  3. Yes, because the bridge delays caused the city to delay finishing the road, thereby creating the need to enforce the provision for liquidated damages.
  4. No, because the city breached the contract by not connecting a road to the bridge.

subject

professional_law

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Source and history

task_id
d4a259b2-9c2a-55c2-a7cf-66933f22a2d3
task_key
all--test--d4a259b2-9c2a-55c2-a7cf-66933f22a2d3
task_revision_id
1
config / split
all / test

Official source

initial import