By Matthew Ingber*
Originally published in Volume 30 | Number 3 in 2014 in the Touro Law Review
*Matthew is an associate attorney at Brown Altman & DiLeo, LLP and handles all matters involving land use and zoning law, municipal law, commercial and residential transactional real estate, and commercial litigation. Matthew has obtained municipal approvals throughout Long Island for national restaurant chains, gasoline station retailers, and alternative energy companies. Matthew graduated summa cum laude from Touro Law Center in 2015. He was a member of the Touro Law Review and served as an Issue Editor.
I. INTRODUCTION
Courts measure damages for breach of a real estate contract based on the difference between the contract price and the fair market value of the property at the time of the breach,[1] which seeks to protect the injured party’s expectation interest.[2] This measure usually provides an injured seller with an adequate remedy in the event of a buyer’s breach[3] but “[i]n some cases, the actual loss suffered as a result of a breach exceeds the amount yielded by that formula.”[4] In American Mechanical v. Union Machine Co.,[5] the buyer contracted to purchase the vendor’s real estate for $100,000.[6] The property was then resold for $55,000, and the seller sought to recover the difference between the original contract and resale price.[7] Although the court recognized that the general measure of damages sometimes inadequately protects the benefit of the injured seller’s bargain,[8] the court failed to formulate an alternative measure to address the problem.
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