THE CONCEPT OF MARKET IN THE SALE OF GOODS

Abstract

This article addresses two questions related to breach of contract: 1) For what kind of damage is an innocent party allowed to claim compensation? and 2) How is the actual monetary value to be assigned to items for which the contract breaker is responsible? The value of performance is determined by the market test; despite this, there is very little guidance on what the term “market” means. In an attempt to clarify, the author reviews both the traditional and new English approaches to determining the “available market.” He argues that the recent English definition, linking the available market to current price is unnecessary, confusing and productive of restriction in the application of market valuation. He explores the effect of price fixing on the Sales of Goods Act, reviews the history of the term “available market,” considers the importance of the nearest market when there is none readily available and the extent of the market area to be taken into account. Finally he explains the current meaning of “available market” in England, the Dominions and the United States.