CIPS Managing Contractual Risk L5M3 Question # 31 Topic 4 Discussion

CIPS Managing Contractual Risk L5M3 Question # 31 Topic 4 Discussion

L5M3 Exam Topic 4 Question 31 Discussion:
Question #: 31
Topic #: 4

GoGo Ltd has contracted Reny Manufacturing to produce a bespoke piece of equipment for them. It is an asset and costs a significant amount of money. A contract is drawn up which states that GoGo Ltd has the right to terminate the contract at any time for any reason. Halfway through production of the asset, GoGo Ltd calls Reny Manufacturing to cancel the order. Reny Manufacturing has incurred many costs already. Can GoGo Ltd cancel the order?


A.

yes- the order has not yet been delivered meaning that GoGo Ltd can cancel- there has been no transfer of ownership


B.

no- Reny Manufacturing will sue for damages


C.

yes- there is a termination clause in the contract


D.

no- the termination clause is unfair


Get Premium L5M3 Questions

Contribute your Thoughts:


Chosen Answer:
This is a voting comment (?). It is better to Upvote an existing comment if you don't have anything to add.