Section 4 Damages

• Library: Consumer Law and Practice 2010

The measure of a seller's damages for a buyer's breach of a real estate contract is well-established. In 1862, the Supreme Court of Missouri stated:

"That a vendor of land, on failure of a purchaser to pay, may re-sell and recover damages for the breach of the first contract, is well settled; and, although the difference in price between the first and second sales is not conclusive, yet, according to the authorities, it affords a good criterion of the damages actually sustained."

Hawkins v. Foster, 897 S.W.2d 80, 86 (Mo. App. S.D. 1995) (quoting Gardner v. Armstrong, 31 Mo. 535, 540-41 (1862)).

When the buyer breaches, a seller is not required to sell the property to another buyer in order to be entitled to damages:

"In sales of an interest in realty, there is no obligation on the part of the seller to elect his remedy when the buyer defaults and there is no applicable theory of mitigation of damages. The seller may resell the property or retain it and, in either event, be entitled to recover his loss measured by the difference between the contract price and the market price. . . . [I]f he does resell within a reasonable time after the breach, the price obtained is some evidence of market value."

Hawkins, 897 S.W.2d at 87 (quoting Leonard v. Am. Walnut Co., 609 S.W.2d 452, 455 (Mo. App. W.D. 1980)). It...