Steve the Stonemason enters into a signed written contract with Harry Homeowner

Question

Steve the Stonemason enters into a signed written contract with Harry Homeowner to build a stone retaining wall along his front property line. The contract contains detailed specifications regarding the location and size of the wall as well as the materials to be used. The contract price is $4,400. Steve will provide all materials and labor at Steve’s expense. In accordance with their agreement, Harry pays Steve a deposit of $1,700 before work starts with the remaining $2,700 to be paid upon completion of the work. Steve starts the job but then, without a valid legal excuse, he stops work in the middle of the job. Harry is completely unable to locate Steve to find out when he will finish the job. After a few months and no word from Steve, Harry hires Sally Stonemason to complete the job at a contract price of $3,200. What damages, if any, can Harry recover fromSteve based on these facts

A.$400

B.$750

C.$2,700

D.$500

E.$4,400

Explanation / Answer

As a standard measure of compensatory damages, one can recover the damage that is caused by hiring a substitute. Suppose, Steve completed the job then Harry would have paid him $ 2,700. But now, he had to pay $3200. Hence, actual loss that can be recovered = 3200 - 2700 = $500

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