(1) Subject to the provisions of this article with respect to proof of market price (section 4-2-723), 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 4-2-715), 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.
Source: L. 65: p. 1340, § 1. C.R.S. 1963: § 155-2-713.
ANNOTATION
Law reviews. For article, "One Year Review of Contracts", see 39 Dicta 161 (1962). For article, "Commercial Law", see 55 Den. L.J. 425 (1978).
Annotator's note. Since § 4-2-713 is similar to repealed § 121-1-67, CRS 53, and CSA, C. 143A, § 67 (uniform sales act), relevant cases construing those provisions have been included in the annotations to this section.
Where a corporation refuses to deliver stock pursuant to an option agreement, the price paid for the option is not the measure of damages, and where the stock is available on the market at a much lesser price than that in the option agreement, dismissal for lack of damages is appropriate. Colo. Mgt. Corp. v. Am. Founders Life Ins. Co., 148 Colo. 519, 367 P.2d 335 (1961).
Where there is no mutual rescission of a contract for sale, the buyer cannot recover a down payment if he wrongfully refuses to accept redelivery. Thack v. Durham, 120 Colo. 253, 208 P.2d 1159 (1949).
"Time when buyer learned of the breach" means "time of performance" in anticipatory repudiation cases. Cargill, Inc. v. Stafford, 553 F.2d 1222 (10th Cir. 1977).
Damages normally measured from time performance is due. Under this section damages normally should be measured from the time when performance is due and not from the time when the buyer learns of repudiation. Cargill, Inc. v. Stafford, 553 F.2d 1222 (10th Cir. 1977).
Under this section a buyer may urge continued performance for a reasonable time. Cargill, Inc. v. Stafford, 553 F.2d 1222 (10th Cir. 1977).
After reasonable period, buyer should cover. At the end of a reasonable period during which the buyer may urge continued performance he should cover if substitute goods are readily available. Cargill, Inc. v. Stafford, 553 F.2d 1222 (10th Cir. 1977).
Calculation of damages if buyer cannot cover. If a valid reason exists for failure or refusal to cover after the reasonable time for urging continued performance is over, damages may be calculated from the time when performance is due. Cargill, Inc. v. Stafford, 553 F.2d 1222 (10th Cir. 1977).
Calculation if buyer could but does not cover. If after a reasonable time during which a buyer urges continued performance substitution is readily available and buyer does not cover within a reasonable time, damages should be based on the price at the end of that reasonable time rather than on the price when performance is due. Cargill, Inc. v. Stafford, 553 F.2d 1222 (10th Cir. 1977).
Applied in William B. Tanner Co. v. Mesa Broad. Co., 575 F. Supp. 1501 (D. Colo. 1983).