Damages for distress and inconvenience in building contracts

Having building work carried out can be a stressful experience. The situation is even worse if the project does not go according to plan and is delayed or there are substantial defective works. The emotional stress and anxiety can often cause more of a dispute than the financial value of the claim.

The recent case of Vyas and another v Goraya (trading as Taj Construction Roofing) [2016] EWCA Civ 1095 restated the current law that

1. The amount awarded will be modest;
2. In the absence of particular physical symptoms or illnesses caused by the breaches it is unlikely that general damages to exceed the rate £3,000 per person per year. In many cases it may be less.

The Works included a loft conversion, an extension at ground floor level, rewiring and some re-plumbing, a new staircase, new kitchen and new windows. The detail of the work is set out in a written contract dated 27 February 2012. The work was to start on Monday, 27 February 2012 and be completed by in 16-18 weeks. The contract price was approximately £75,000. The work was not completed on time or at all and there were substantial defects in the work. The contract was terminated in early 2013.

The property owners claimed they did not have the money to pay for someone to carry out the remedial works, and claimed damages for distress and inconvenience for 2 years and 9 months. The trial judge awarded damages of £2,000 per annum per adult and £1,500 per annum for each adult child for a period of 2 years.

In relation to the award for distress and inconvenience, the court did not think it could interfere with the judge’s assessment as to the amount awarded and the period for which it was payable, as it had not heard the evidence, but noted that:

1. by way of mitigation, the property owners should have taken steps to complete the works within a much shorter period than two years (it had emphasised earlier in its judgment that they could not recover additional damages because of their inability to fund the necessary repairs; and
2. the basis on which damages had been awarded in respect of the children (who were not parties to the contract) was unclear. However, as this point had not been appealed, the Court of Appeal did not comment on the matter any further.

This reiterates that in real terms the damages for distress and inconvenience will be modest despite the fact that to the individuals involved it is significant.

We recommended that the parties entering into a contract agree the amount of liquidated damages payable per week in the event of delay to the completion of the Works where the fault is down to the Contractor. This provides certainty as to the compensation payable in the event of delay without the need to actually prove the actual financial or other loss suffered.

If you need more information contact Richard Millard, Construction & Dispute Resolution Partner on 01908 689382 or email rmillard@geoffreyleaver.com.