In the sale of goods, when a buyer covers in good faith, how is cover damages calculated?

• A. Cover price minus contract price
• B. Market price minus contract price
• C. Value as promised minus value delivered
• D. Contract price

Answer: (A)

When a buyer covers in good faith under the UCC, the damages are measured by the difference between the cost to obtain substitute goods (the cover price) and the contract price. This means the buyer can recover the extra amount spent to cover, plus any incidental or consequential damages related to obtaining the substitutes, minus any savings from not having to purchase under the contract. The essential idea is to put the buyer in the position they would have been in had the seller performed. The other options don’t fit this remedy: using market price instead of cover price applies to different scenarios, valuing what was promised versus delivered is a broader measure not specific to cover, and only the contract price ignores the buyer’s actual outlay to cover.