In a sale of goods under the UCC, the buyer accepts nonconforming goods and later sues for breach of warranty. What is the proper measure of damages for a breach of warranty that reduces the value of the goods?

• A. The difference between the value of the goods as delivered and the value if they had been conforming, plus incidental and consequential damages.
• B. The contract price paid for the goods.
• C. The diminution in value alone, without incidental damages.
• D. The cost to repair the goods, up to the contract price.

Answer: (A)

The key concept is how damages are measured after the buyer has accepted nonconforming goods. When a breach of warranty occurs post-acceptance, the proper measure is the diminution in value caused by the nonconformity, plus incidental and consequential damages resulting from the breach. In other words, you compare what the goods are worth as delivered with what they would be worth if they had conforming quality, and you add the additional losses incurred because of the breach (like inspection, handling, transport, and other foreseeable damages).

This is why the correct choice captures both parts: the difference in value plus incidental and consequential damages. The contract price alone doesn’t reflect the actual loss in value, and using only the diminution in value omits recoverable incidental and consequential damages. The cost to repair isn’t the governing measure for the post-acceptance warranty damages, though repair costs may fall under incidental damages in some cases, they’re not the primary measure by themselves.