Under the terms of a written contract, Karp agreed to construct for Manor a garage for $10,000. Nothing was said in the parties' negotiations or in the contract about progress payments during the course of the work. For this question only, assume the following facts. After completing 25% of the garage strictly according to Manor's specifications, Karp demanded payment of $2,000 as a "reasonable progress payment." Manor refused, and Karp abandoned the job. If each party sues the other for breach of contract, which of the following will the court decide? 
Both parties are in breach, and each is entitled to damages, if any, from the other.  Only Karp is in breach and liable for Manor's damages, if any.  Only Manor is in breach and liable for Karp's damages, if any.  Both parties took reasonable positions, and neither is in breach. 