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Exam question help – measuring damages

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › Exam question help – measuring damages

  • This topic has 3 replies, 2 voices, and was last updated 6 years ago by MikeLittle.
Viewing 4 posts - 1 through 4 (of 4 total)
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    Posts
  • May 7, 2019 at 7:46 pm #515256
    kingkongsajang
    Member
    • Topics: 95
    • Replies: 75
    • ☆☆

    Why is it this:

    “It would be the cost of completing the work to the required specification unless the cost of remedying the defects are disproportionate to the difference in value between what was supplied and what was ordered”

    ? What Does this mean?

    I thought it was just the difference in the value of what the building would be if job done properly to contract, and the value it is now when there has been a breach of contract and agreed terms are not met properly.

    Thank you sir

    May 8, 2019 at 6:44 am #515279
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23314
    • ☆☆☆☆☆

    This is illustrated by the 1965 case Ruxley Electronics v Forsyth – worth a read and here’s the link:

    https://en.wikipedia.org/wiki/Ruxley_Electronics_and_Construction_Ltd_v_Forsyth

    You’re correct in querying the case – even the Appeal Court judges got it wrong

    But where the ‘damage’ from the breach was not of great significance, one has to say that common sense got in the way

    There has been an exam question based on the Ruxley case about a lady (was she called Anne? I can’t remember) that wanted a wall to be built high enough to hide a local tip

    Read the Ruxley link and then, if you’re still not completely happy, post again

    OK?

    May 15, 2019 at 12:43 pm #515991
    kingkongsajang
    Member
    • Topics: 95
    • Replies: 75
    • ☆☆

    So it’s not the cost of fixing the problem to what it should have been, if the cost of remedying it exceeds the actual cost incurred?

    Therefore it’s basically what the actual damage incurred is, which may not be the difference in value between what it would be if supplied as contracted, and what the value is when there is breach of contract?

    May 15, 2019 at 1:36 pm #516006
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23314
    • ☆☆☆☆☆

    Correct – it’s NOT “the cost of remedying it exceeds the actual cost incurred?” … necessarily (the Ruxley case)

    I believe that your second paragraph succinctly explains the Ruxley decision

    OK?

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