Question

In: Economics

Sally enters into a contract with John to purchase John’s 2015 Volvo for $18,000. On the...

Sally enters into a contract with John to purchase John’s 2015 Volvo for $18,000. On the day that the contract is to be performed Sally tenders the $18,000 but John refuses to deliver the Volvo. Sally sues John for breach of contract.

Sally locates a Volvo identical to John’s. Sally purchases the identical Volvo for the price of #20,000. In addition the automobile was located 150 miles from where Sally and John resided. Sally pays Bill, a classmate, $150 to go to “pick up and deliver” the Volvo.

Discuss the amount of damages, if any, that Sally can recover. Identify the legal classification for each “type” of damage Sally receives.

Would the amount of damages change if Sally went herself to pick up the Volvo?

Solutions

Expert Solution

Sally entered into the contract with John to purchase a car for $18000 but John refused to deliver the car on the execution day.
The car similar to that was located 150 miles away and has been bought by Sally for $20000 and also paid $150 for pick up and deliver.
This is a clear case of breach of contract and Sally is entitled to damages for the extra amount she paid for the same car.
In addition to that, she is also entitled to receive 'pick up and deliver cost' and legal expenses incurred to seek the damages.
She should also claim damages for psychological stress she has to go through and interest on the payment she made to purchase the car.

It is the case of breach of contract and although she has hired her classmate to pick up and deliver the car, the cost would not have been changed even she herself was there to pick up the car.
She is entitled to additional damages for the time and cost incurred for picking up that car which was 150 miles away from where she has resided.


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