Buyer B pays $10,000 to New Orleans grain dealer D in exchange for D’s promise to deliver grain to buyer B’s London office on October 1. As a result of signing this contract, B decides not to sign a similar contract with another dealer for $10,500. D contracts with shipping company S to transport the grain. Buyer B agrees to resell the grain on arrival in London for $11,000 to another party. B pays $100 in advance (nonrefundable) as docking and unloading fees for the ship’s projected arrival in London. The ship begins taking water several days out of New Orleans and returns to port. Inspection reveals that the grain is badly damaged by salt water, and D sells it as cattle fodder for $500. D conveys the news to B in London, who then purchases the same quantity of grain for delivery on October 1 at a price of $12,000.
a. How would you measure expectation damages for D’s breach of contract with B?
b. How would you measure reliance damages?
c. How would you measure opportunity-cost damages?