Question

Contractors Service, Inc., enters into a contract to build a restaurant for Dierdre’s Soup Spoons Bistro with Dierdre’s payment due on August 1. On August 1, her bank is closed, and for this reason, she claims that she cannot pay on time. In this situation:
a. ​Dierdre is in breach of contract.
b. ​Dierdre’s bank is liable to Contractors Service.
c. ​the contract is suspended.
d. ​the contract is discharged.

Answer 1

Answer:

a. ​Dierdre is in breach of contract.

Explanation:

Breach refers to not filling the duty as mentioned in the contract and then legally not following the contract.

When a contract is made, then there is bound to complete the act contracted, by both the parties,

This is because the contract binds both the parties.

Here, in the given instance Contractors Service Inc. is bound to build the restaurant for Dierdre's Soup Spoon Bistro.

In return the contract binds Dierdre's Soup spoon Bistro to make payment on 1 August.

Thus, in case if the bank is closed on 1 August, the payment shall have been made on 31 July.

Or in case there is some clause inserted in the contract allowing payment some other day in case of banks not working on the contract date.

Thus, this is breach of contract.

Since it did not completed its duties.