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CIPS Exam L3M3 Topic 3 Question 17 Discussion

Actual exam question for CIPS's L3M3 exam

Question #: 17
Topic #: 3

[All L3M3 Questions]

A contract clause indicating damages to be recovered in the event of under-performance, with the proposed damages being a genuine pre-estimate of loss, is called a:

APunitive damages clause

BLiquidated damages clause

CPenalty clause

DUnliquidated damages clause

Show Suggested Answer

Suggested Answer: A

In English law, implied terms exist, even if you can't see them in the contract documents. They commonly derive from statute. An example is the Sale of Goods Act.

by Chana at Aug 05, 2024, 07:56 AM

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Adelle

2 months ago

Liquidated damages it is. Better to have a clear agreement on the damages upfront than leave it up to the courts later on.

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Florinda

5 days ago

D) Unliquidated damages clause

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Maryanne

10 days ago

C) Penalty clause

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Laurel

12 days ago

B) Liquidated damages clause

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Kiley

15 days ago

A) Punitive damages clause

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Bobbie

24 days ago

A: Exactly, it helps avoid any disputes in the future.

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Kenneth

1 months ago

B: I agree, it provides clarity and certainty for both parties.

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Lindsey

1 months ago

A: Liquidated damages clause is definitely the way to go.

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Kristofer

2 months ago

Haha, I almost went with the 'Penalty clause' option. Sounds like something out of a bad movie contract!

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Naomi

2 months ago

Yeah, I agree. Liquidated damages is the correct answer here. It's a way to avoid the uncertainty of unliquidated damages.

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Lon

2 months ago

Yes, you're right. It helps to provide certainty in case of under-performance.

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Carri

2 months ago

I think it's a liquidated damages clause.

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Cathrine

2 months ago

Hmm, I think the answer is B. Liquidated damages clause. That's the one where the damages are agreed upon beforehand, right?

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Eleonore

1 months ago

That's right, a liquidated damages clause specifies the amount to be paid in case of under-performance.

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Tegan

1 months ago

Liquidated damages clause is when the parties agree on the amount of damages in advance.

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Herminia

1 months ago

I agree, the damages are predetermined in a liquidated damages clause.

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Dahlia

2 months ago

Yes, you're correct. It is indeed B) Liquidated damages clause.

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Reiko

2 months ago

I'm not sure, but I think C) Penalty clause is also a possibility. It's important to differentiate between liquidated damages and penalties.

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Lajuana

2 months ago

I agree with Nidia, because liquidated damages are meant to be a genuine pre-estimate of loss.

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Nidia

3 months ago

I think the answer is B) Liquidated damages clause.

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