Applying the basic principles of English contract law, if building
work is defective due to a breach of contract, the remedy is the cost of correcting
the defects.
Another approach is to retain the defective work as built
and make an equitable deduction in payments to the builder. Deductions might be based on whichever of the
following is applicable: the savings made by the builder’s not having to
correct the work, the loss of value in the finished building caused by retaining
the defects, the lower cost of building poorly, the foreseeable increased cost
of building maintenance, loss of longevity, etc.
The courts have in most cases based remedies on the cost of
correction or of diminution in value.
There are exceptions where the courts have awarded nominal damages only. This has occurred where the defects caused loss
of amenity for the owner’s personal preferences. The case of Ruxlev Electronics and Construction
Ltd. v. Forsyth is often cited in this connection.
In a more recent case the courts awarded nominal damages for
a failure to build a garage to the specified dimensions. While the logic by which the courts held that
nominal damages were an appropriate remedy can be distinguished from Ruxley,
the effect is the same in so far as it makes it uncertain that a contract requiring
building work to be done precisely as drawn and specified can be enforced
effectively. Where does this leave
building professionals who advise on and prepare building contracts? Do we have to say to our clients, if you
enter a building contract based on agreed drawings and specifications, you may have
to put up with a deficient building or pay twice?
