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Fred G. Dare Appliances, Inc. sold a $2,000 refrigerator to W.H. Pool. Per the terms of the agreement, the buyer was to pick up the appliance on July 1, and pay for it in full before taking possession. July 1 came and went, and the buyer did not appear. Fred G. Dare, the owner of the store, is certain that W.H. Pool breached the contract.
Fred has a plan. His best friend, Sam S. Ung, desperately needs a new refrigerator, but he cannot currently afford one at full retail price. In fact, Sam only has $200. Fred plans to sell the refrigerator to Sam for $200, and then send a bill for $1,800 to W.H. Pool. (The $1,800 represents the difference between the price of the refrigerator in Fred G. Dare Appliances, Inc.’s contract with W.H., and the “resale” price of $200 to Sam.) Fred’s reasoning is that W.H. breached the contract, and that he is simply exercising his resale right. Fred’s brother-in-law, an attorney, once told him that if a customer breaks a purchase contract, the seller has the right to resell the good to a substitute buyer, and then recover any damages from the original, breaching buyer.
What is your legal opinion of Fred G. Dare’s plan?