Spokes Bicycles has a contract with Trail Parts,Inc.that requires Spokes to buy 200 bicycle gears from Trail at a price of $50 per gear.For an unknown reason,Spokes cancels the contract after Trail has already finished manufacturing all 200 gears.Trail offers the gears to ACE Bikes for $20 each.ACE is shocked by the great deal because these types of gears normally retail for $50.ACE agrees to purchase the gears.Trail then sues Spokes for its lost profits.Which of the following is true?
A)ACE bikes must pay Trail $50 per gear.
B)Trail is not entitled to damages because it was able to resell the goods.
C)Trail's damages will be limited because its resale was not in good faith and in a commercially reasonable manner.
D)Trail will be able to recover damages for the difference between the resale price and the price the buyer agreed to pay in the contract.

Question

Quizplus · Accepted Answer

If the seller sets aside goods intended for the contract or completes the manufacture of such goods,he is not obligated to try to resell the goods to someone else.However,he may resell them and recover damages.The seller must make any resale in good faith and in a commercially reasonable manner.If the seller does so,he is entitled to recover from the buyer as damages the difference between the resale price and the price the buyer agreed to pay in the contract [2-706].

Spokes Bicycles Has a Contract with Trail Parts,Inc