King Aircraft Sales, Inc. v. Lane

King Aircraft Sales, Inc., doing business as King Aviation Services (King) (plaintiff), offered to buy two “quality, no damage” airplanes from Joe Lane Jr., doing business as The Lane Company, and Lane Aviation, Inc. (Lane) (defendants). King intended to resell the planes for a profit. After Lane accepted King’s offer, Lane proposed to sell the planes to King “as is” instead. King did not accept this proposal, and Lane backed out of the original agreement. King sued Lane in equity for specific performance. Before the trial, however, Lane sold the planes to a third party, which resold the planes at a profit. The trial court found that although the planes were not truly unique, King could not cover because the planes’ outstanding condition was so rare. The trial court held that the other-proper-circumstances provision of Uniform Commercial Code (UCC) § 2-716 applied, and awarded King the amount that the third party had made on the resale. Lane appealed, arguing that a damages award was improper in a suit for specific performance. Lane also argued that § 2-716 did not apply because King had not shown an inability to cover based on the lack of a remedy at law, given that King had rejected Lane’s proposal to sell the planes as is. King cross-appealed, arguing that King should have received the blue-book value of the planes instead of the resale profit at the time of trial.