MBE Sample – Question 18 - Actual
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MBE Sample - Question 18

A company contracted with a builder to construct a new corporate headquarters for a fixed price of $100 million. At the time of the contract, structural steel was widely available and was included in the contract as a $6 million item. Before work began on the project, tornado damage shut down the production facility of the biggest structural steel supplier in the country, and the price of structural steel increased by 20% as a result. The builder informed the company of the steel price increase, and the parties then orally agreed to increase the project price to $101 million.

The builder proceeded with construction and delivered the project on time. The company paid the builder $100 million but refused to pay the additional $1 million.

If the builder sues the company for $1 million, is the builder likely to prevail?

A
No, because the modification was never reduced to a writing signed by the party to be charged.
B
No, because there was no consideration for the modification of the contract.
C
Yes, because the company’s promise was supported by consideration.
D
Yes, because the modification was fair and equitable in view of the unanticipated increase in the price of structural steel.
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