Contracts for Work and Materials often involve the incorporation of goods into other goods, property or land. Therefore you cannot simply get your money back and be put back into the same position you were in before the work started. Imagine having a conservatory built which is then condemned, or a sofa irreparably damaged by a poor attempt to upholster, or the laying of a new floor which has only got to the stage of ripping out your old floor. Not only will you have to get the money back for the work which hasn’t been done, but you will have to pay another firm to come and put right the work already carried out. Because of this the usual remedy is often damages, although the first step is to terminate the contract with the original supplier to prevent any further work being carried out. It is important not to forget that damages must be a fair reflection of any economic loss, personal injury, damage to property and (perhaps but not always) distress and inconvenience. You cannot be seen to be benefitting from any cash settlement over and above what you need to put things right. The extent of the damages awarded obviously depends on the overall effect the breach of contract has had on you. Imagine having a dress made which turns out to be poorly made and a poor fit. Imagine the same situation if it was a wedding dress. Now imagine what would happen if the dress was delivered late and only arrived on the morning of the wedding. Therefore the damages will be greater if there is significant reliance on or expectation from the service being performed.
There are several other preconditions necessary in order for damages to be awarded. Firstly the loss must arise directly from the breach, and not from any intervening events. Imagine if you had called a taxi to take you to the airport for an important business meeting in New York. The taxi then turned up late causing you to miss your flight and lose a multi-million pound deal. Would it be fair to claim the loss of millions on the lateness of a taxi?
Secondly, it is your responsibility to mitigate losses in the intervening period. For example if you come home one day to find your house has been damaged by a leak, you must do everything you can to prevent any further damage, rather than simply ignoring the situation and allowing it to worsen.
Thirdly, if the consequences of the breach could not reasonably have been foreseen by your supplier, then you may not be awarded damages. If an air conditioning system breaks down in a room where fresh food is being stored, causing the food to perish, the firm who installed the system cannot then be held liable for the economic loss of the food if they were not aware the room would be used for that purpose at the outset.
- Where the price is significantly higher than the estimate
- The job was done as a ‘foreigner’. Do I have any rights?
- Using the Small Claims Court