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.