Near Privity Differs from Privity in That

question 62

Multiple Choice

Near privity differs from privity in that:

• A) The plaintiff has standing in cases where the wrongdoing is less severe than fraud.
• B) The auditor must know the plaintiff.
• C) The plaintiff must show that (s)he relied on the financial statements.
• D) All of the above.

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Definitions:

Liquidated Damages

A bona fide estimate of the monetary damages that would flow from the breach of a contract.

Consequential Damages

Indirect damages that do not flow directly from the act but occur as a consequence of the initial act, often involving loss of profit or other secondary losses.

Liquidated Damages

A pre-determined sum agreed upon by parties in a contract as compensation for breach of contract, where actual damages are difficult to ascertain.