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26 September, 21:20

Lauren hires Humphrey, a CPA, to audit her financial statements. The engagement letter includes a statement acknowledging that audited financial statements are required to be filed with a regulatory body by October 1. Humphrey does not complete the audit until October 5. Lauren is late filing the financial statements and is fined $100,000 by the regulatory body. Lauren would most likely sue Humphrey claiming:

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  1. 26 September, 22:13
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    breach of contract

    Explanation:

    Lauren and Humphrey have entered into a contract agreement. Each party has agreed to fulfill a certain obligation for some consideration. Humphrey has failed in fulfilling his obligation in the agreed time. Consequently, Lauren has incurred losses of $100,000.

    Contracts are legally enforceable agreements. An aggrieved party like Lauren can seek legal redress in case of a breach of contract. Lauren will need to show that he was in contract with Humphrey. He has to demonstrate that he has suffered losses as a result of Humphrey not fulfilling his obligation. Lauren has the option to sue Humphrey for breach of contract that has resulted in financial damages.
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