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CIPS Exam L5M3 Topic 1 Question 28 Discussion

Actual exam question for CIPS's L5M3 exam

Question #: 28
Topic #: 1

[All L5M3 Questions]

Restitution damages are often calculated before contracts are signed and are clearly stated within a contract. Which of the following statements is not true?

Arestitution damages means you are unable to claim for future losses

Brestitution damages may leave the breaching party in a worse position than they were in before the contract began

Crestitution damages are calculated based on how much the breaching party gained, ra-ther than how much the innocent party lost

Drestitution damages cannot be mitigated by the actions of the innocent party

Show Suggested Answer

Suggested Answer: D

'restitution damages cannot be mitigated by the actions of the innocent party' is the untrue state-ment out of these four. The general principle of Restitution Damages is that the innocent party is expected to be proactive in mitigating the consequences of any breach and should not allow costs to spiral out of control. See p. 124

by Gayla at May 18, 2024, 03:02 PM

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Lili

5 months ago

Haha, I bet the exam writers had a field day coming up with these tricky answer choices. Restitution is no laughing matter, though!

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Alysa

5 months ago

It's important to understand the implications before signing any contract.

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Sylvia

5 months ago

I know, restitution damages can be quite complex.

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Jesusita

5 months ago

Yeah, these answer choices are really making me think.

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Lynelle

5 months ago

D is definitely not true. The innocent party can take actions to mitigate the damages, reducing the restitution owed.

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Ilona

5 months ago

I think C is the correct answer. Restitution is based on the gain to the breaching party, not the loss to the innocent party.

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Raul

4 months ago

That's right, it's not about the innocent party's loss but the breaching party's gain.

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Leontine

4 months ago

I agree, restitution damages focus on what the breaching party gained.

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Royce

5 months ago

That's right, it's not about the loss to the innocent party but the gain to the breaching party.

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Adelina

5 months ago

I agree, restitution damages are calculated based on how much the breaching party gained.

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Shaun

5 months ago

That's right, it's not about the innocent party's losses at all.

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Haydee

5 months ago

I agree, restitution damages are all about how much the breaching party gained.

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Marylyn

6 months ago

Option A seems wrong. Restitution damages can include future losses, just not as the primary focus.

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Herminia

5 months ago

D) restitution damages cannot be mitigated by the actions of the innocent party

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Vonda

5 months ago

Option A seems wrong. Restitution damages can include future losses, just not as the primary focus.

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Agustin

5 months ago

C) restitution damages are calculated based on how much the breaching party gained, rather than how much the innocent party lost

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Emeline

6 months ago

B) restitution damages may leave the breaching party in a worse position than they were in before the contract began

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Tori

6 months ago

A) restitution damages means you are unable to claim for future losses

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