CIPS Exam L5M3 Topic 2 Question 42 Discussion

Actual exam question for CIPS's L5M3 exam

Question #: 42
Topic #: 2

[All L5M3 Questions]

When assessing damages caused by a breach, which of the following statements is true?

Adamages are limited to what is stated within the contract

Bdamages can be difficult to assess before a breach has occurred and therefore should be decided through conflict resolution

Cdamages attempt to position the innocent party in the position that they would have been in had the contract been performed as expected

Ddamages attempt to compensate the innocent party for errors made by the offending party

Show Suggested Answer

Suggested Answer: C

The correct answer is: 'damages attempt to position the innocent party in the position that they would have been had the contract been performed as expected'. This is a quote from p. 121 Option1 is incorrect as unliquidated damages aren't stated in a contract. Option 2 is incorrect because liquidated damages are an assessment of damages before a breach. Option 4 is incorrect because not all breaches are caused by errors (they can be caused by negligence or the offending party withholding something).

by Melodie at Oct 19, 2024, 10:50 AM

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Catalina

3 months ago

Ah, the age-old question of contract damages. I'm going with C - it's the only one that makes sense from a legal perspective. Though I do wonder if the offending party gets a discount for their 'creative interpretation' of the contract.

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Gaston

2 months ago

It's important to consider all aspects of contract damages and ensure that the innocent party is properly compensated.

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Madonna

2 months ago

I'm not sure about giving the offending party a discount for their 'creative interpretation' of the contract. They should be held accountable for their actions.

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Linsey

3 months ago

I think damages should definitely aim to put the innocent party back in the position they would have been in if the contract was fulfilled.

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Francine

3 months ago

I agree, option C seems to be the most fair and logical choice.

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Wilda

4 months ago

D sounds good, but I'm pretty sure that's not the right answer. Damages are about compensating the innocent party, not punishing the offending one.

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Adolph

3 months ago

I think C is the correct answer. It's about making things right for the innocent party.

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Phillip

3 months ago

B) damages can be difficult to assess before a breach has occurred and therefore should be decided through conflict resolution

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Michael

3 months ago

C) damages attempt to position the innocent party in the position that they would have been in had the contract been performed as expected

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Cecily

3 months ago

A) damages are limited to what is stated within the contract

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Noe

4 months ago

I agree with Luis, damages are meant to put the innocent party in the position they would have been in if the contract was performed as expected.

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Luis

4 months ago

I think the answer is C.

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Barney

4 months ago

Haha, the correct answer is definitely not B. Waiting for a breach to happen before deciding on damages? That's like trying to close the barn door after the horses have already escaped!

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Bettina

4 months ago

I think option C is the correct answer. The purpose of damages is to put the innocent party back in the position they would have been in if the contract had been performed as expected.

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