Andy Has Entered into an Agreement Whereby He Can Make

question 32

Multiple Choice

Andy has entered into an agreement whereby he can make limited use of software that will remain stored at the licensor's site.Andy accesses the software over the Internet when he needs to use it,but does not store the software on his own computer.Andy uses this software three or 4 days a week,and usually has no problem,but on some occasions the licensor's computer is down and Andy cannot access the software.Based on the above,which of the following is true?

• A) Andy can get out of the contract because the inability to access the software is a material breach whereby he is not getting the benefit of the bargain.
• B) If the periods the computer is down are considered normal in the industry,there has been no breach.
• C) This is considered a breach of the warranty of noninterference.
• D) The downtime of the computer is not a breach only if it is scheduled in advance and Andy is given notice of it.

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Definitions:

Commercial Substance

A transaction's capability to change the future cash flows of a business in a way that is measurable.

Old Machine

A piece of equipment that has been in use for a significant period and may be near or beyond its expected useful life.

Depletion

The allocation of the cost of a natural resource over its useful life as it is consumed or mined.

Ore Mined

The quantity of valuable mineral or material extracted from the earth.