Farley v Skinner [2001] 3 WLR 899

KEY POINTS

• Compensation can be granted for inconvenience, yet not solely for emotional distress.

• However, when a contract's purpose is to provide peace or enjoyment, and this is thwarted due to a contract breach, the aggrieved party may be eligible for damages to cover the emotional distress resulting from the loss of expected pleasure.

FACTS

• A successful businessman was considering retirement and sought to purchase a peaceful country residence. He was interested in Riverside House, a beautiful property in Blackboys village, Sussex, located around 15 miles from Gatwick International Airport.

• The plaintiff wanted to ensure that the property was not significantly impacted by aircraft noise, as tranquillity was his main priority. The plaintiff hired the defendant, an experienced surveyor, to inspect the property and address specific concerns, including aircraft noise. He clearly stated that he did not want a property on a flight path.

• The surveyor's report provided reassurance regarding aircraft noise, stating that they did not notice any noise during their inspection and believed the property would not be greatly affected by it. Based on this positive report, the plaintiff decided to purchase the property for £420,000, which included chattels worth £45,000.

• After moving in, the plaintiff discovered that the property was indeed affected by aircraft noise, contrary to the surveyor's earlier assessment.

JUDGEMENT

• Appeal allowed. Trial judge’s award of damages restored.

COMMENTARY

• The ruling articulated that damages for distress could be claimed when the contract's primary purpose is to provide emotional satisfaction or pleasure, and this purpose is frustrated by the breach.

• The decision emphasised that the nature of the contract, its specific objectives, and the foreseeability of distress are pivotal factors in determining whether damages for emotional distress can be awarded.

ORIGINAL ANALYSIS

• F employed S to go to a house that F intended to buy for relaxing weekends and to report on noise levels. S said no noise. In fact house was by a runway and the noise was v loud. 

• HL awarded F £10,000 compensation for “distress and inconvenience”. HL accepted that the contractual breach no longer had to relate to the “sole object” of the contract but to a “distinct and important obligation”

Lord Steyn

• Bingham LJ’s dicta in Watts were merely broad guidelines, not rules. 

• Also that case was about defects and general information, whereas this case is about one specific question: noise levels. 

• He agrees with Bingham LJ’s assertion that in general the contract breaker is not liable for frustration, anxiety etc. However there are exceptions: where D has been caused pain, suffering or loss of amenity (this exception defies the rule!). 

• He refutes the assertion that the breach has to relate to “the very object” of the contract (as required in Watts): if a “major or important part” of the contract is to give pleasure or peace of mind, then this is enough.

  • NB though, the only real distinction between this an Watts is the fact that the surveyor was asked about noise specifically here i.e. it was the object of the contract. If Lord Steyn is right about the word “object” then Watt is really being overruled.

Lord Scott

• The word “physical” in Bingham LJ’s guiding principles refers to the cause of the discomfort (e.g. being woken up by a plane) i.e. a sensory discomfort, as distinct from a feeling of unhappiness provoked by being sacked, for example.

RELATED CASES

• Hamilton Jones v David Snape

• Watts v Morrow