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Examination Timing: 00H00M01S

Mark Thompson agreed with a contractor, John Baker, to build a tennis court in his back garden, specifying a length of 60 metres. However, the completed court has a maximum length of only 46 metres. Mark now wishes to sue for the cost of demolishing the tennis court and rebuilding it to conform to the original specifications. 


Which measure of damages do courts usually employ in contractual disputes of this nature?

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In cases where the cost of reinstatement is disproportionate to the benefit obtained, courts typically award damages based on the difference in value. This principle was established in cases such as Ruxley Electronics and Construction Ltd v Forsyth [1996] AC 344, where the cost of reinstatement was deemed unreasonable because the expense would be vastly out of proportion to the benefit. Therefore, the court awarded damages based on the difference in value between the contracted performance and the actual performance. Mark's case would likely follow this precedent, as demanding the complete demolition and rebuilding of the tennis court may be considered excessive. 


Key Point: In contract law, when the cost of reinstatement is unreasonable or disproportionate, the measure of damages is usually the difference in value between what was contracted and what was provided. This approach balances fairness and practicality in awarding damages.

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