Which of the Following Contracts Has Been Frustrated

question 7

Multiple Choice

Which of the following contracts has been frustrated?

• A) Dreamhomes Co is planning to construct 40 semi-detached homes. After a public offer has been made and all prospective units have been sold but not allocated, the City Council only gives permission to build 36. The four purchasers left out in the cold after allocation of the homes claim damages. Dreamhomes claims that those contracts have been frustrated.
• B) Flytech Industries Co has been contracted by Libyan National Airways to construct a passenger jet for immediate use. Libyan Airways plans to use the passenger jet for a new route between Tripoli and Rome. As construction nears completion, Libyan Airways is told by the authorities at Da Vinci Airport in Rome that it will not be issued landing rights at the airport.
• C) United Tankers Co operates two tankers for the shipment of oil from the Middle East, the Monaco and the Lichtenstein. United Petroleum contracted with United Tankers for the shipment of oil from Qatar to Portsmouth in April. Internally, United Tankers allocates the Lichtenstein for this job. In February, the Lichtenstein is attacked by terrorists and sunk off the coast of Yemen. The Monaco is occupied with another job. United Petroleum sues for damages. United Tankers claims frustration.
• D) None of the options given is correct.

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Definitions:

Expectancy Theory

A psychological theory proposing that an individual's motivation is related to their expectation of success, the value of that success, and the perceived likelihood that effort leads to achievement.

Instrumentality

A belief or expectation that a particular level of performance will lead to specific outcomes or rewards.

Utility Reactions

The perceived usefulness and the positive or negative responses of individuals towards a particular intervention or program.

Return on Expectations

A measurement of the success of a project or investment based on the fulfillment of the stakeholders' initial expectations and objectives.