On May 1, Fred agreed to sell and deliver 1,000 bushels of wheat to a baker for $7 per bushel. After the market price of wheat rose to $8 per bushel, Fred breached the contract by refusing to sell a bushel of wheat at $7. He demanded that the baker pay $8.50 per bushel of wheat. If the baker can get substitute wheat at the current market price, can he get specific performance? If not, what options are available to him if he seeks damages for breach of contract from Fred? What will he recover under each option?
What will be an ideal response?
The baker cannot get specific performance because wheat is not a unique product, is readily obtainable elsewhere, and in this case, is obtainable at the market price. The two alternative options available to the baker are to either to cover (buy substitute wheat) and claim the difference between the contract price and the price of the substitute wheat, or to sue for the difference between the market price at the time of breach and the contract price. In this case, either remedy will allow the baker to recover $1,000.
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