(1) Subject to the provisions of this article with respect to proof of market price (Section 2-723 [55-2-723 NMSA 1978]), the measure of damages for nondelivery or repudiation by the seller is the difference between the market price at the time when the buyer learned of the breach and the contract price together with any incidental and consequential damages provided in this article (Section 2-715 [55-2-715 NMSA 1978]), but less expenses saved in consequence of the seller's breach.

(2) Market price is to be determined as of the place for tender or, in cases of rejection after arrival or revocation of acceptance, as of the place of arrival.

History: 1953 Comp., § 50A-2-713, enacted by Laws 1961, ch. 96, § 2-713.

OFFICIAL COMMENTS

UCC Official Comments by ALI & the NCCUSL. Reproduced with permission of the PEB for the UCC. All rights reserved.

Prior uniform statutory provision. — Section 67(3d), Uniform Sales Act.

Changes. — Rewritten.

Purposes of changes. — To clarify the former rule so that:

1. The general baseline adopted in this section uses as a yardstick the market in which the buyer would have obtained cover had he sought that relief. So the place for measuring damages is the place of tender (or the place of arrival if the goods are rejected or their acceptance is revoked after reaching their destination) and the crucial time is the time at which the buyer learns of the breach.

2. The market or current price to be used in comparison with the contract price under this section is the price for goods of the same kind and in the same branch of trade.

3. When the current market price under this section is difficult to prove the section on determination and proof of market price is available to permit a showing of a comparable market price or, where no market price is available, evidence of spot sale prices is proper. Where the unavailability of a market price is caused by a scarcity of goods of the type involved, a good case is normally made for specific performance under this article. Such scarcity conditions, moreover, indicate that the price has risen and under the section providing for liberal administration of remedies, opinion evidence as to the value of the goods would be admissible in the absence of a market price and a liberal construction of allowable consequential damages should also result.

4. This section carries forward the standard rule that the buyer must deduct from his damages any expenses saved as a result of the breach.

5. The present section provides a remedy which is completely alternative to cover under the preceding section and applies only when and to the extent that the buyer has not covered.

Point 3: Sections 1-106, 2-716 and 2-723.

Point 5: Section 2-712.

"Buyer". Section 2-103.

"Contract". Section 1-201.

"Seller". Section 2-103.

Buyer may recover purchase price and incidental damages. — A buyer, who rightfully rejects or justifiably revokes acceptance of goods, has the right not only to rescind and recover back the purchase price paid, but, in addition, the right to recover incidental damages resulting from the seller's breach, including expenses reasonably incurred in the care and custody of such goods. Grandi v. LeSage, 1965-NMSC-017, 74 N.M. 799, 399 P.2d 285.

Law reviews. — For article, "Special Property Under the Uniform Commercial Code: A New Concept in Sales," see 4 Nat. Resources J. 98 (1964).

For article, "New Mexico's 'Lemon Law': Consumer Protection or Consumer Frustration?", see 16 N.M.L. Rev. 251 (1986).

Am. Jur. 2d, A.L.R. and C.J.S. references. — 22 Am. Jur. 2d Damages §§ 509, 510.

Loss of anticipated profits as damages for breach of seller's contract as to machine for buyer's use, 32 A.L.R. 120.

Measure of recovery by buyer where seller breaches agreement to repurchase at selling price, 50 A.L.R. 325.

Loss of, or damage to, crops as element of damages for breach of contract of sale of agricultural machinery or fertilizer, 69 A.L.R. 748.

Inability of a seller of a commodity manufactured or produced by a third person to obtain the same from the latter as a defense to an action by the buyer for breach of contract, 80 A.L.R. 1177.

Buyer's acceptance of part of goods as affecting right to damages for failure to complete delivery, 169 A.L.R. 595.

Interest as element of damages recoverable in action for breach of contract for the sale of a commodity, 4 A.L.R.2d 1388.

Right to recover, in action for breach of contract, expenditures incurred in preparation for performance, 17 A.L.R.2d 1300.

Necessity that buyer, relying on market price as measure of damages for seller's breach of sales contract, show that goods in question were available for market at the price shown, 20 A.L.R.2d 819.

Mental anguish as element of damages in action for breach of contract to furnish goods, 88 A.L.R.2d 1367.

Allegation of buyer's ability and willingness to perform, in action for damages for failure to deliver goods purchased, 94 A.L.R.2d 1215.

77A C.J.S. Sales § 395 et seq.