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Watts v Morrow [1991] 1 All ER 937

By Oxbridge Law TeamUpdated 04/01/2024 07:00

Judgement for the case Watts v Morrow

KEY POINTS

  • In the legal discussion about financial compensation one party seeking as redress for the harm or losses they have incurred. The determination of these damages’ rests on several crucial factors that are integral to the case.

  • The method employed to quantify the extent of damages owed to the aggrieved party should be under scrutiny. The central question pertains to the most appropriate basis for calculating the financial compensation owed to the affected party.

  • The accuracy and content of the surveyor's report should be carefully examined, given its potential impact on the final determination of damages. The report is pivotal in the ongoing dispute, as it was essential in assessing the extent of damage. The accuracy and content of the surveyor's report are carefully examined, given its potential impact on the final determination of damages.

  • Negligence is a fundamental element that significantly influences the question of liability for damages in any legal dispute.

  • Determining the expenses related to rectifying the defects that can be reclaimed is a pivotal issue in the overall assessment of damages.

  • The damages can be measured by assessing the variance between the property's described value, as presented in the surveyor's report, and its actual true value, factoring in the identified defects. This assessment method is central in quantifying the damages sought within this legal dispute.

FACTS

  • The plaintiffs, a married couple, acquired a property for the sum of £177,500. Their decision to purchase this property was based on a building surveyor's report issued by the defendant in August 1986. 

  • The plaintiffs' intention in obtaining the property was to use it as a second home, and they had explicitly sought a property that would not necessitate extensive repairs, desiring a reasonably trouble-free residence. The defendant's report, which the plaintiffs relied upon, conveyed that the defects identified in the property could be managed through regular maintenance.

  • Upon taking possession of the property in 1987, the plaintiffs encountered defects beyond those outlined in the defendant's report. The expenses incurred to rectify these unreported defects amounted to £33,961. Subsequently, the plaintiffs initiated legal proceedings against the defendant, asserting negligence and breach of contract claims.

  • In the initial trial, the judge ruled in favor of the plaintiffs, ordering the defendant to pay for the cost of repairs, totaling £33,961, and awarding general damages of £4,000 to each plaintiff as compensation for the "distress and inconvenience" they experienced.

  • The defendant subsequently appealed the decision, specifically challenging the quantum of damages awarded by the court.

JUDGEMENT

  • In the judgment delivered upon the appeal, it was held that the appeal was allowed. The court reasoned that in the absence of a specific warranty from the defendant guaranteeing the accuracy of the property's condition as described, no legal grounds existed for awarding the entire cost of repairs to the plaintiffs. 

  • In this case, the appropriate measure of damages was the amount required to place the plaintiffs in a position as if the contract had been correctly fulfilled. Consequently, the plaintiffs suffered financial loss was confined to the disparity between the represented value of the property and its actual value in its true condition.

COMMENTARY

  • A married couple purchased a property based on a building surveyor's report, expecting it to be trouble-free. However, they discovered defects beyond what was mentioned in the report, incurring repair costs of £33,961. 

  • They sued the surveyor, alleging negligence and breach of contract. The initial judgment favored the couple, awarding them repair costs and additional damages for distress.

  • Upon appeal, the court ruled in favor of the surveyor. Since there was no guarantee of the property's accuracy in the report, the court found no basis for the full repair cost. 

  • The damages were calculated based on the difference between the property's represented value and its actual value, aligning the plaintiffs' position with what they would have been if the contract had been fulfilled accurately.

ORIGINAL ANALYSIS

  • A surveyor, Defendant, told Plaintiff of the value of a house, but failed to report many defects, causing them to undertake costly repairs and suffer inconvenience when the repairs were occurring.

  • CA said that the aim of compensation was to put the owners in as good a position as they would have been, had there been no breach of contract. Therefore Defendant had to pay the difference between the actual value of the house and the value as Defendant represented it to be.

  • On the question of inconvenience-based damages, CA said that in the case of the ordinary surveyor's contract general damages were recoverable only for distress and inconvenience caused by physical consequences of the breach of contract and that the compensation for the physical inconvenience should be a modest sum. 

Bingham LJ

  • In general, for policy reasons, "A contract-breaker is not in general liable for any distress, frustration, anxiety, displeasure, vexation, tension or aggravation” that his breach causes, except where the contract’s purpose is to “provide pleasure, relaxation, peace of mind or freedom from molestation”.

  • A surveyor’s contract does not fall within that category. However for cases not falling within that category, “physical inconvenience and discomfort caused by the breach and the mental suffering directly related to that inconvenience and discomfort” can be compensated, albeit with “modest” awards.

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Contract Law Notes
1,511 total pages
754 purchased

From the AuthorContract law notes fully updated for recent exams at Oxf...