Contracts-Effect of Breach on the Aggrieved Party

Common law: duty to mitigate (but no obligation by employee to take different type of work, lower pay, or relocate in order to mitigate; burden on employer to show employee had available mitigate options).

UCC:
Cover-- in event breach goes to whole contract, buyer may "cover" by obtaining the goods from a substitute seller and recover difference between contract price and cost of cover contract as consequential damages.

Loss of bargain-- failure to cover does not preclude loss of bargain remedy but buyer's loss is limited to such as could not have been obviated by cover. Buyer will have to prove this amount.

Resale contract-- when breach is by the buyer, seller has a duty to resell the goods in the marketplace to fix his consequential damages as the different between resale and contract prices.

Perfect tender, rejection and cure under the UCC:
1. buyer has duty of prompt inspection
2. if inspection reveals any non-conformity of goods or tender, buyer may accept whole, reject whole, or accept any commercial unit and reject the balance.
3. if buyer accepts, he retains a claim for damages for any difference between the market value of the goods accepted and the contract price for conforming goods.
4. if buyer rejects, he must give seasonable and specific notice to the seller.
5. if time remains for seller's performance, buyer must cooperate with seller in any cure effort. seller must give seasonable notice of intent to cure.
6. Merchant buyer must seek and follow reasonable instructions re disposing of non-conforming goods. If no instructions, buyer may store them, ship them back, or re-sell them for the seller's account (retaining a reasonable fee for expenses, not to exceed 10% of resale price). If goods are perishable, merchant buyer MUST try to sell them for seller's account.

Revocation of Acceptance for Accepted Goods:
1. where non-conformity escaped detection despite reasonable inspection and revocation occurs 1) within reasonable time after discovery (or should have discovered) and 2) before change in condition of goods not caused by the undetected defects.
2. buyer accepted in reliance on seller's express assurance of cure and seller fails to cure within a seasonable time.
Revoking buyer must preserve economic value, mitigate loss, and cooperate with cure effort if revocation is due to undiscovered defect.

Consequential damages for a repudiated contract under the UCC are fixed when the buyer learns of seller's intent not to perform, rather than at performance date.