CIPS Exam L6M5 Topic 2 Question 9 Discussion

Actual exam question for CIPS's L6M5 exam

Question #: 9
Topic #: 2

[All L6M5 Questions]

Cyril Engineering entered into a contract with Dojo Ltd for electrical engineering services to a power station.

The contract was successful for two years, but Cyril Engineering failed to fulfill obligations recently.

Q: What is this situation known as?

Answer Options:

AConsequential Loss

BDamages

CDefault

DDirect Loss

Show Suggested Answer

Suggested Answer: C

Failure to meet contractual obligations is classified as Default (p.123).

Consequential Loss (A) refers to indirect financial loss due to contract failure.

Damages (B) are legal remedies for breaches.

Direct Loss (D) relates to immediate financial impact, but default is the correct term for a failure to meet obligations. [P.123]

by Dottie at Apr 03, 2025, 05:51 AM

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Gregg

4 months ago

I'm going with C) Default. It's the only option that accurately describes the situation where a party fails to fulfill its contractual obligations.

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Jenise

3 months ago

Default is definitely the most appropriate term for this scenario.

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Rosalia

3 months ago

I agree, Default is the term used when a party fails to fulfill their obligations in a contract.

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Grover

3 months ago

Yes, you're right. Default is the correct option in this situation.

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Reuben

4 months ago

Yes, because Cyril Engineering failed to fulfill their obligations, causing harm to Dojo Ltd.

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Leslee

4 months ago

This question is a piece of cake! C) Default is the obvious answer. Cyril Engineering defaulted on the contract, plain and simple.

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Broderick

4 months ago

I think it could also be considered as Damages.

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Dominque

4 months ago

B) Damages is the way to go here. Cyril Engineering's failure to fulfill obligations has caused damages to the client, Dojo Ltd.

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Mauricio

4 months ago

D) Direct Loss seems like the correct answer to me. The failure to fulfill obligations led to a direct loss for the client, Dojo Ltd.

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Catrice

3 months ago

D) Direct Loss seems like the correct answer to me. The failure to fulfill obligations led to a direct loss for the client, Dojo Ltd.

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Twana

3 months ago

D) Direct Loss

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Mireya

3 months ago

C) Default

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Cora

4 months ago

B) Damages

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Graciela

4 months ago

A) Consequential Loss

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Rodolfo

5 months ago

I think the answer is C) Default. The contract was successful for two years, but Cyril Engineering recently failed to fulfill its obligations, which is a clear case of default.

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Dino

3 months ago

So, the correct answer is C) Default.

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Quentin

3 months ago

In this situation, Cyril Engineering failed to meet their obligations, leading to default.

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Bok

3 months ago

Default is when one party fails to fulfill their obligations under a contract.

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Pamella

3 months ago

Yes, you are correct. It is indeed a case of default.

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Dulce

3 months ago

So, the correct answer is C) Default.

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Melodie

4 months ago

In this situation, Cyril Engineering failed to meet their obligations, leading to default.

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Celestina

4 months ago

Default is when one party fails to fulfill their obligations under a contract.

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Esteban

4 months ago

Yes, you are correct. It is indeed a case of default.

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Reuben

5 months ago

The situation is known as Default.

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