CIPS Exam L5M3 Topic 2 Question 36 Discussion

Actual exam question for CIPS's L5M3 exam

Question #: 36
Topic #: 2

[All L5M3 Questions]

Logan Gin Distillery is creating a contract for one of its new suppliers. It is a complicated item that they are ordering and if things go wrong, it would have an extremely negative impact on production, and therefore on revenue. However it is impossible to say what the cost of this would be if things were to go wrong. What type of clause should be included in the contract?

Aliquidated damages

Bunliquidated damages

Cpenalty clause

Dservice credit

Show Suggested Answer

Suggested Answer: C

DEF must deliver the pasta required by ABC is the correct answer. Specific performance is when the innocent party is rewarded by receiving what was initially negotiated - in this case the delivery of pasta. It's basically a posh way of saying that the court mandates you to do what the contract says. See p. 129 for information on Specific Performance.

by Corinne at Sep 11, 2024, 01:56 PM

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Tracey

1 days ago

I think we should include a liquidated damages clause in the contract.

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