Susan, a merchant, agreed to construct a special industrial machine for Betty, another merchant, for $40,000. The machine was almost finished when the contract was made. Susan was to ship the machine to Betty, but before the machine was completely finished, the building containing the machine burned to the ground, totally destroying the machine. The fire was not anyone's fault.

a. Betty must pay for the machine.

b. Susan and Betty split the loss not covered by insurance.

c. Susan must build another machine and stand ready to perform or be sued for breach of contract.

d. Betty's performance is excused and the contract is terminated.

e. If Betty had made a down payment, Betty will lose it as Betty's contribution to Susan's loss.

Answer rating: 100% (QA)

d Bettys performance is excused ... View the full answer