## Facts

- A. Lenobel, Inc. was the official Plymouth automobile dealer for Long Island City.
- On May 27, 1936, Charles G. Senif agreed in a written contract to buy a Plymouth automobile from Lenobel for $781.50 and paid $50 down.
- On June 1, 1936, Senif sent a written notice attempting to cancel the contract; Lenobel refused to accept that Senif had a right to cancel.
- Lenobel later resold the same automobile for $781.50.
- Lenobel sued Senif for breach of contract, claiming $226.50 as “loss of gross profits.”
- To support its damages theory, Lenobel offered proof of dealership overhead and selling expenses (including salesmen, advertising, providing cars and gasoline, and employing men to seek and interview prospective buyers and to demonstrate cars), arguing that Senif’s breach reduced the number of sales over which such expenses could be spread.
- The trial court excluded the overhead evidence, dismissed Lenobel’s complaint, and entered judgment for Senif on his counterclaim seeking return of the $50 deposit.
- On intermediate review, the dismissal of Lenobel’s complaint was affirmed; the counterclaim disposition was altered (reversed and a new trial ordered on the counterclaim).
- Lenobel obtained leave to appeal to the Appellate Division limited to a single question: the proper measure of damages.

## Issues

1. Under New York Personal Property Law § 145(3), when a dealer resells the same car for the contract price in an available market, may the dealer recover claimed lost gross profits by characterizing general overhead and selling expenses as “special circumstances” showing greater proximate damage?

## Decision

- The court applied New York Personal Property Law § 145, which governs a seller’s damages for a buyer’s nonacceptance.
- Where there is an available market, § 145(3) sets the default measure of damages as the contract price minus the market/current price at the time acceptance was due, absent “special circumstances” showing greater proximate damage.
- Lenobel’s resale of the same automobile for $781.50 supported the conclusion that an available market existed and that the contract–market differential was zero.
- The court rejected Lenobel’s overhead-allocation theory as a basis for “special circumstances” damages in this setting.
- Because overhead and ordinary selling expenses were not the kind of proximate, transaction-specific loss contemplated by § 145(3)’s “special circumstances” proviso, the trial court properly excluded the proffered overhead evidence.
- With no recoverable damages shown beyond the statutory measure, dismissal of Lenobel’s complaint was affirmed on the damages question that was the sole subject of the appeal.

## Legal Principles

- Under New York Personal Property Law § 145(3), a seller’s damages for a buyer’s refusal to accept goods are generally the difference between the contract price and the market/current price at the time acceptance was due, when an available market exists.
- A resale at the contract price is strong evidence that an available market existed and that the statutory contract–market measure yields no damages.
- “Special circumstances” under § 145(3) require a showing of greater proximate damage than the contract–market difference; ordinary overhead and routine selling expenses, without more, do not satisfy that requirement when the seller resells the same goods at the same price.
- A seller is not entitled to recast general operating costs as additional damages to obtain a recovery beyond what the statutory market-based measure permits in a ready resale market.

## Conclusion

The Appellate Division affirmed the denial of lost-profit recovery because Lenobel resold the same automobile for the contract price in an available market, making damages zero under Personal Property Law § 145(3), and the dealer’s proposed proof of general overhead and selling expenses did not constitute “special circumstances” showing greater proximate damage.


A. Lenobel, Inc. v. Senif, 252 A.D. 533 (1937)