When a Client Breaches a Contract with a Construction Contractor

question 57

Multiple Choice

When a client breaches a contract with a construction contractor in the early phase of construction,what is the contractor generally able to recover?

• A) the amount of the contract price
• B) only the out-of-pocket costs incurred by the contractor up to the time of the breach
• C) the amount necessary to provide the same profit to the contractor that the contractor would have earned if the contract were fully performed
• D) three times the contract price as punitive damages
• E) the amount determined by the court to have been a fair profit on the contract

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Definitions:

Outstanding Shares

Outstanding shares refer to the total number of shares of a corporation that are currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.

Treasury Shares

Shares that were issued and subsequently reacquired by the issuing company, reducing the amount of outstanding stock on the financial market but not considered when calculating earnings per share or dividends.

MBCA

Stands for the Model Business Corporation Act, which is a template law designed to standardize and regulate the formation and operation of corporations across the United States.

Limited Voting Rights

Voting rights that are restricted in some manner, such as being allowed only under certain conditions or only applying to specific matters.