Contracts Question

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Skyrocket11
Posts: 3
Joined: Thu Jan 06, 2011 6:01 am

Contracts Question

Postby Skyrocket11 » Mon Jan 31, 2011 12:07 pm

Buyer enters K with Seller in San Francisco for $1000 for widgets. Buyer breaches the K. Delivery of widgets was supposed to be on Nov 1 in New York. These same widgets were selling for market price of $600 on Nov. 1 in San Francisco, and market price of $800 on Nov. 1 in New York. There are no incidental expenses.

I know the formula is K price - market price at time and place for tender +/- incidental expenses incurred or saved. What is market price at time and place for tender?
Is the formula
A) 1,000 - 600 = 400 in damages
B) 1,000 - 800 = 200 in damages

???

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dailygrind
Posts: 19667
Joined: Wed Oct 22, 2008 11:08 am

Re: Contracts Question

Postby dailygrind » Mon Jan 31, 2011 2:45 pm

seems to need a litttttle bit more information, but the most likely outcome is A.

in answering A, i assume that the seller has not yet shipped the widgets to NY (which is made more credible by the fact that there have been no incidental expenses yet). since the seller has not yet shipped, when he mitigates damages the best he can do is mitigate in SF, which leaves him with a claim for 400 in damages. there's some duty to mitigate stuff that can complicate this slightly, but i'm guessing that it's unimportant in this hypo.

lawschooliseasy
Posts: 460
Joined: Mon Dec 28, 2009 7:13 pm

Re: Contracts Question

Postby lawschooliseasy » Mon Jan 31, 2011 2:49 pm

Skyrocket11 wrote:Buyer enters K with Seller in San Francisco for $1000 for widgets. Buyer breaches the K. Delivery of widgets was supposed to be on Nov 1 in New York. These same widgets were selling for market price of $600 on Nov. 1 in San Francisco, and market price of $800 on Nov. 1 in New York. There are no incidental expenses.

I know the formula is K price - market price at time and place for tender +/- incidental expenses incurred or saved. What is market price at time and place for tender?
Is the formula
A) 1,000 - 600 = 400 in damages
B) 1,000 - 800 = 200 in damages

???


EDIT: Misread the question. I think that the seller is justified in any sale that is made with "reasonable effort" at market price. I doubt the law would compel them to sell in either location.




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