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3)An electricity company rented an underground pipe system from a city. The developer's purpose in renting the pipe was to use it for installing electrical cables. The electricity company then

entered into another contract with a sub-contractor for a price of$2,000,000 to complete the installation by a specified date. The contract specified that if the sub-contractor fails to complete the installation on time then the sub-contractor is responsible to pay a penalty of $10,000 a day with a maximum liability of$500,000.Case Study Scenario: The sub-contractor failed to meet the specified deadline. Moreover, during installation, the contractor has damaged significant amounts of the electrical cables, with the result that the electricity company incurring additional expenses to fix the damaged cables. The total cost of supplying and installing the replacement cables plus the amount of incurred penalties for which the sub-contractor is responsible of totaled $750,000 Question: Explain and discuss what the electricity company could sue the sub-contractor for? In giving reasons for your answer, identify and explain the relevant legal principles (from your experience in fundamental breach of contract) and how it would apply.

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