A Florida seller breaches a $350,000 contract. The buyer incurs $2,500 in inspection costs, $1,200 in loan application fees, and $800 in attorney fees, then purchases a comparable property for $365,000. What are the buyer's total compensatory damages?
Correct Answer
C) $18,500
Total compensatory damages = Cover damages ($365,000 - $350,000 = $15,000) + Out-of-pocket expenses ($2,500 + $1,200 + $800 = $4,500) = $18,500. Option A only includes expenses, ignoring cover damages. Option B only includes the price difference, ignoring expenses. Option D incorrectly adds an extra $1,000.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Consideration is something of value exchanged between parties to a contract, making the agreement legally binding. It can be money, a promise to act, a promise to refrain from acting, or anything else of value.
Contingencies are conditions written into a real estate contract that must be met before the transaction can close. If a contingency is not satisfied, the buyer can typically cancel the contract without penalty.
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
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