Real Stones Inc. and Sparkling Jewelry stores enter into a contract for a sale of gemstones. The seller fails to deliver. Sparkling can recover as damages the difference between
A)any loss avoided and any profit gained.
B)the actual price and the hoped-for price.
C)the contract price and the market price.
D)the current prices in the contracting parties' places of business.

Question

Quizplus · Accepted Answer

The correct answer is C) the contract price and the market price. In a situation where a seller fails to deliver goods as per a contract, the buyer can recover damages equal to the difference between the contract price and the market price of the goods at the time and place of delivery. This measure of damages is designed to put the buyer in as good a position as they would have been had the contract been performed.