A and B Enter into a Contract Whereby a Agrees

question 4

Multiple Choice

A and B enter into a contract whereby A agrees to supply B with 10 000 tins of tuna at the rate of 1000 tins per month from his tuna factory in Bayport,Nova Scotia,and B agrees to pay A $2 per tin.A supplies 1000 tins of tuna,but before he can collect,his factory is destroyed by fire.If the contract is discharged by frustration,which of the following statements is correct?

• A)A must obtain the tuna from another source to satisfy the contract.
• B)B will have to pay A the sum of $2000 because there was no deposit.
• C)Only future obligations are discharged,and B must pay A the sum of $2000.
• D)All obligations under the contract are discharged,A and B's obligations are both discharged,and B does not have to pay A the sum of $2000.
• E)B will not have to pay A the sum of $2000 because there is no longer a contract.