Arnold and Doug Make a Contract for Arnold to Manufacture

question 41

Multiple Choice

Arnold and Doug make a contract for Arnold to manufacture five leather chairs of a specified design.Prior to their manufacture, the factory is destroyed in an accidental fire that is no one's fault.The chairs are available from other sources.Arnold:

• A)must supply the chairs, even if he must buy them elsewhere.
• B)is discharged from his duty to deliver the chairs by the destruction of the factory.
• C)has materially breached the contract if he fails to deliver the chairs.
• D)must return any money paid by Doug.

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Definitions:

Noncompete Clause

A provision often included in a contract to purchase a business that restricts the seller from entering the same type of business within a specified area for a certain amount of time.

Intellectual Property Contract

A legal agreement that outlines the terms of use, distribution, and ownership of intellectual property between two parties.

Similar Business

A company that operates in the same industry or offers similar products or services as another business.

Last Minute

Refers to actions or decisions made very close to a deadline or an event's scheduled time.