1- Mary Sue entered into an agreement to buy fifty computers from Alice for a to
ID: 363035 • Letter: 1
Question
1- Mary Sue entered into an agreement to buy fifty computers from Alice for a total of $70,000. The price did not include $500 in freight and insurance and a $3,000 installation charge. Alice agreed to install the network for Mary Sue. Two days before delivery, Alice phoned and said she would not be able to deliver the computers and that she was going out of business. Mary Sue protested and said she needed the machines, as she had already sold her old network and had started removing it in anticipation of the new machines. Alice apologized but said there was nothing she could do for Mary Sue.
Mary Sue went out and purchased similar computers from Bill for $90,000. He charged her no freight but did add a $5,000 installation fee. In addition, Mary Sue paid Ruth $10,000 for emergency computer service so that Mary Sue could continue operations until the new machines were installed.
Mary Sue now sues Alice for breach of contact. Alice claims she is not liable, as she notified Mary Sue in advance and Mary Sue mitigated her losses with replacement machines. Please discuss the amount of damages, if any, that Mary Sue may recover.
Explanation / Answer
In given case- Its breach of contract. As per contractual term & obligation both party must develop proposal which must include clause "what if", clause which explain penalty clause if either party deny to perform said task as per agreement then whats are measure available to decide losses.
Summery-
Accordingly damages involve difference in cost which occur due to breach of contract. In given case Alice fail to prove reasons behind to breach the contract was beyond control or due to force de-measure in that case damages are recoverable from Alice. which include cost of Ruth $ 10000 & difference $90000- $70000 that is recoverable amount $ 30000. Due to breach of this contract marry has to pay difference of installation that is $5000-$3000 that is $2000 additional cost incurred. Hence total recoverable amount $ 32000 As amount of installation & fright and insurance was beyond the scope of agreement but due to breach of this contract unwanted expenses bear by Mary sue.
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