Ruxley Electronics and Construction Ltd v Forsyth
[1996] AC 344
Ratio Decidendi
The cost of reinstatement is not always the appropriate measure of damages for defective performance. Where reinstatement would be unreasonable or disproportionate, the court may award damages for loss of amenity or diminution in value instead.
Fapte
Forsyth contracted Ruxley to build a swimming pool 7ft 6in deep. The pool was built to only 6ft 9in deep, though it was still safe for diving. Forsyth claimed £21,560 for the cost of rebuilding the pool. The trial judge awarded £2,500 for loss of amenity instead.
Rezumatul hotărârii
The House of Lords upheld the £2,500 award. Lord Jauncey held that the cost of reinstatement was grossly disproportionate to the benefit obtained — the pool was perfectly usable. The appropriate measure was loss of amenity reflecting the consumer surplus of the bargain.
Citate cheie
"Damages are designed to compensate for an established loss and not to provide a gratuitous benefit to the aggrieved party."
— Lord Jauncey
Tratament ulterior
Leading authority on the assessment of damages for defective performance, particularly the choice between cost of cure and diminution in value.