How much can I expect in damages?

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.

How can I resolve the situation?

What about contracts for services?

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3 comments… add one
  • DENNIS HILEY 8 January, 12:15 pm

    late 2012 i had the roof on my old mid terraced house re furbished using the original slates+replacements with new batons and felt.pre work i had 2 minor leaks into the attic which were dripping into a bucket..since the work was completed and some heavy rain i now have rain damage in my bedroom in variuos areas along the ceiling line where the chimney breast is and a corner outside bedroom wall,i asked the roofer to view the damage and he suggested taking the stack down to below the roof line and slate the gap,as i didnt have a problem in this area pre-roof work,i suggested there was maybe a flashng problem which he dismissed,in the mean time im dreading more rain damage…

  • lynn 19 December, 1:18 pm

    My builder has made a mess of laying my floor tiles they are lipping and the grout is coming out.He has left unfinished jobs. I have leaks from plumbing washingmachine, water damaged door, odd skirting boards the list is just endless. He now has asked us for more money, we have refused until we see undone jobs and floor is rectified. He has walked off the job, took his tools and now says he is going to take us to the small claims court.. What are our rights,, he was paid cash no contract and he has had three quarters of the money already,, regards Lynn

  • Caroline 7 September, 7:47 am

    It would appear that the householder can do very little to get their money back, why are the laws so easy for the rouge trader to get around? These people are laughing at the so called powers that Building Inspectors have, not to mention their attitude towards the courts. We have an ongoing situation of 15 weeks, during which time we have been lied to, people have not turned up, the Project Manager and the builder neglected to get building regs permissions and have left us in an unsafe environmentand yet they can seemingly refuse to put any of it right and defy the Inspector by not turning up! If the law was clear and tough builders would not flout them. Financial penalties should apply if you provide a dodgy contract or ignore the terms of any contract.