Contracts and Sales Multistate Bar Practice Exam

In what situation can restitution be limited to the contract price?

1. When the plaintiff has provided a benefit to the defendant

2. When the plaintiff is in breach of contract

3. When there is no contract between the parties

4. When the benefits received are fully compensated by the market value

The correct answer is: When the plaintiff is in breach of contract

The situation in which restitution can be limited to the contract price occurs when the plaintiff is in breach of contract. This is grounded in the principle that a breaching party is not entitled to recover for benefits conferred under the contract beyond the agreed-upon terms. Essentially, if the plaintiff fails to fulfill their obligations under the contract, they cannot claim restitution beyond the contract price because it would be unjust to allow them to benefit from their own breach. In this scenario, limiting restitution to the contract price serves to uphold the contractual agreement between parties and ensures fairness in enforcing contract terms. The idea is that allowing a breaching party to recover more than what they were entitled to would undermine the contract itself and incentivize breach. Restitution operates on the premise of preventing unjust enrichment, and when one party breaches, the expectation is that they do not deserve any additional compensation beyond what the contract stipulated, reinforcing the idea of maintaining the integrity of contractual obligations.