Examination Timing: 00H00M01S
Jeremy Clarkson contracted with Whitfield Construction Ltd for an extension to his Derbyshire home, which included building a new garage. The agreed specifications in the contract stated the garage should be 28’ wide by 14’ deep. However, upon completion, the garage was built to dimensions of 27’ by 13’, rendering it too small to accommodate Jeremy’s car. As a result, Jeremy has initiated legal proceedings against Whitfield Construction for the costs of demolishing the incorrect structure and building a new one to specification. You are advising Whitfield Construction on their legal position.
Which of the following is the best description of Whitfield Construction's position regarding the claim's quantum?
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The correct answer is C. Under common law, specifically referring to the principles established in cases such as Ruxley Electronics and Construction Ltd v Forsyth [1995] UKHL 8, damages for breach of contract are typically calculated to put the claimant in the position he would have been had the contract been performed correctly. Here, Jeremy is primarily claiming for the cost of reinstatement, which the court must consider. The court will assess the reasonableness of such a remedy by examining the disproportionality between the cost of demolition and reconstruction and the actual loss suffered in terms of utility and value. While Jeremy is entitled to damages, the court may find that the cost of reinstatement is disproportionate compared to the benefit of having a garage of the exact specifications. Therefore, Whitfield Construction might be liable only for the difference in value or loss of amenity, not necessarily the full cost of reinstatement.
Key Learning Points:
Contract Law - Damages: Understanding how damages are calculated in contract law, including the concepts of difference in value, cost of reinstatement, and loss of amenity.
Proportionality Principle: The importance of the proportionality principle in awarding damages, especially in construction contracts.
Legal Defense Strategy: Recognizing viable defences and advising on potential liabilities and outcomes based on specific legal precedents.
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