In 1987, Gordon and Amy Tan opened a drug store in the city of Newton. During the next 30 years, the Tans devoted themselves to developing their business and to raising their four children. In 2017, when their youngest child graduated from college, the Tans decided that it was time to sell their business, which had grown to 12 stores, and to retire. Through their lawyer, Stewart Taylor, the Tans employed Miranda Evans, a business broker, to assist them in the sale of the business. The Tans and Evans entered into a brokerage contract in which the Tans agreed to pay Evans 5 percent of the sales price of their business as a commission. Under the terms of the contract, 25 percent of the commission was due when the contract was signed, with the balance payable at the closing of the sale. In June 2018, Evans succeeded in finding a purchaser, Simpson's, Inc., a large regional chain of drug stores. On June 19, 2018, the parties signed a contract of sale in which Simpson's agreed to purchase the Tan's 12 stores for a price of $4.5 million. The contract provided for a closing on October 15, 2018. Simpson's paid an earnest money deposit to Taylor of $250,000. With the approval of the Tans and Simpson's, Taylor paid from this deposit $56,250 to Evans as payment of the commission due Evans, leaving a balance held by Taylor of $193,750. p. 972On September 15, 2018, the Tans received a letter from Simpson's stating that as a result of its due diligence investigation of the Tan's business, it would no longer be in a position to go forward with the purchase of the Tan's stores. The Tans immediately consulted with Taylor and Evans about how to proceed. Evans suggested that she would investigate informally what had happened to cause Simpson's to change its plans. Taylor advised the Tans that they should write to Simpson's to put it on formal notice that the Tans would insist on their contract rights. They decided, however, to delay this letter for a few days pending the results of Evans's contacts. A few days later Evans met with Taylor and the Tans. Evans informed them that she had learned that a dramatic restructuring of the retail drug industry was under way, with many existing companies and new entrants beginning to offer drugs over the Internet. Apparently, Simpson's had decided to follow this route and would be closing, rather than opening or acquiring, new retail outlets. Taylor immediately wrote to Simpson's stating that Simpson's was bound contractually to purchase the Tan's stores, that the Tans insisted on strict compliance with the contract, and that the Tans were ready, willing, and able to proceed with the sale. He demanded that Simpson's proceed with the closing as scheduled. They received no response to this letter. On October 15, the Tans and Taylor appeared at the closing, but no one appeared on behalf of Simpson's. Taylor immediately wrote to Simpson's informing it that Simpson's had committed a total breach of the contract by failing to appear at the scheduled closing. Taylor informed Simpson's that the Tans would use their best efforts to attempt to resell the business, but that their sales efforts were with full reservation of all rights to seek to enforce the contract against Simpson's by action for specific performance or damages. After consultation with Taylor and Evans, the Tans decided to place their stores on the market again and to proceed with a lawsuit against Simpson's seeking to enforce the contract. The Tans signed a new commission contract with Evans, which contained terms identical to the first contract. Taylor filed suit on behalf of the Tans against Simpson's for breach of contract. In January 2019, Evans informed the Tans that she had received an offer to purchase their stores from Rite-Buy, a large national chain of retail drug stores for a price of $2.5 million. Evans told the Tans that she thought that Rite-Buy was "bottom fishing" because it knew about the failed deal with Simpson's. The Tans were in a state of shock and bewilderment from this news. They both believed that the price was grossly inadequate. But, after talking with Taylor and being advised of the "uncertainties of litigation," they finally concluded that they couldn't take a chance on being able to find a better offer. They decided to sell to Rite-Buy and to try to hold Simpson's responsible for damages. The Tan's sale to Rite-Buy was originally scheduled to close on March 3, 2019, but it was twice delayed, finally closing on May 15, 2019. Meanwhile, the lawsuit against Simpson's proceeded through discovery toward trial. The stress of these matters had an effect on the Tans, both of whom worried constantly about Rite-Buy changing its mind and about the lawsuit. Gordon was p. 973especially affected by these events. He treated Simpson's refusal to go forward with the contract as a personal insult. In late May, shortly after he gave a deposition in the case, Gordon suffered a heart attack, which was fortunately a relatively mild one. As part of discovery, Simpson's has served interrogatories on the Tans. One of the interrogatories asks them to state the amount and basis of the damages that they claim in the case. In answer to this interrogatory, Taylor has listed the following elements of damage: The purchase price of the contract totaling $4.5 million. Interest on this amount from October 15, 2019, at the market rate of interest available on U.S. Treasury bonds on that date (approximately 3 percent). Loss of the investment appreciation on the purchase price of $4.5 million if this amount had been invested in the Chambers U.S. Treasury Bond Mutual Fund on October 15, 2019, as the Tans planned to do. Taylor's answer showed that had the Tans invested $4.5 million in that fund on October 15, 2019, the amount would have appreciated by $326,000 as of the time the answer to the interrogatory was given. Commissions paid to Evans totaling $181,250. Attorney fees incurred in litigation with Simpson's. Damages for emotional distress suffered by the Tans as a result of the willful breach of contract by Simpson's in an amount determined by the jury. Punitive damages for fraudulent, willful, and malicious breach of contract in an amount to be determined by the jury.

Assuming the Tans can establish a breach of contract by Simpson's, how should their damages be computed?