davindra maharaj judgmentfinal3 2webopac.ttlawcourts.org › ... › cv_07_04373dd10may2011.pdf ·...

of 51

Republic of Trinidad and Tobago

IN THE HIGH COURT OF JUSTICE

PORT OF SPAIN

Claim No. CV 2007-04373

Between

DAVINDRA MAHARAJ Claimant

And

DEOROP TEEMAL

And

TEEM ENGINEERING SYSTEMS LTD. Defendants

Before The Honourable Mr. Justice Devindra Rampersad

Appearances:

Mr. Azeem Mohammed instructed by Mr. Yaseem Ali for the Claimant

Mr. Bronock Reid instructed by Ms. Francine Wilson for the Defendants

Delivered on 10th May 2011

JUDGMENT

of 51

Contents

JUDGMENT ............................................................................................................................................. 1

STATEMENT OF CASE ............................................................................................................................. 4

Particulars of Damage at the Pasea apartments: ............................................................................ 4

Particulars of Damage at the Macoya apartments: ......................................................................... 5

DEFENCE ................................................................................................................................................. 6

THE EVIDENCE: ....................................................................................................................................... 9

PRELIMINARY ISSUES: .......................................................................................................................... 10

Preliminary issue 1: Whether the first defendant was a party to any contract with, or in any way

personally liable to the claimant? ................................................................................................ 10

Preliminary issue 2: Whether pursuant to an express agreement, $60,000.00 was paid by the

defendant to the claimant in full and final settlement of all claims arising out of or in

connection with the outstanding works to the various premises? .............................................. 14

THE COURT’S VIEW OF THE EXPERT WITNESSES: A necessary preliminary pronouncement ............. 18

THE CORE ISSUES: ................................................................................................................................ 24

Core Issue 1: The terms of the Contract: Whether there was a contract for the construction of

two external staircases at the Pasea apartments? ...................................................................... 24

Core Issue 2: What is the effect of the grant of extensions of time by the claimant to the

defendant for completion of the building and/ or renovation works? ........................................ 26

PASEA APARTMENTS: .......................................................................................................................... 29

Core Issue 3: Whether the defendant completed construction of the Pasea apartments on 30

September 2004? ......................................................................................................................... 29

Core Issue 4: Whether the claimant identified to the defendant any defects or omissions at the

Pasea apartments at the time the keys to same were handed over to him, or anytime

thereafter? If so, were said defects or omissions rectified by the defendants? ......................... 30

MACOYA APARTMENTS: ...................................................................................................................... 31

Core issue 5: Whether, upon handing over the keys thereto on 31 October 2004, any works

remained outstanding and/ or defective, and whether such works, if any, were completed and/

or rectified? .................................................................................................................................. 31

Core Issue 6: From when should damages, if any, begin to run in respect of the Macoya

apartments? ................................................................................................................................. 33

CLAIMANT’S HOME: ............................................................................................................................. 35

Core Issue 7: The various incomplete/ defective works referred to in the Further Information.35

REINSTATEMENT: Whether the claimant is entitled to reinstatement as claimed, or some other

measure of damage in respect of the perimeter wall, jacuzzi, cesspit and swimming pool? ..... 41

The Law: ....................................................................................................................................... 41

The Evidence: ............................................................................................................................... 44

Core Issue 9: ................................................................................................................................. 45

REMOTENESS OF DAMAGE: Whether the defendant ought to be held liable for the loss of rental

income and loss of use of the buildings consequent upon the claimant’s termination of its

services? ....................................................................................................................................... 45

ORDER:Consequently, the Court orders as follows: ............................................................................ 49

of 51

1. This action concerns the construction of certain apartments and certain renovation works

carried out by the defendants, whose business is building contracting. It is a case of breach of

contract - first, an allegation that the defendants failed to honour their time obligations for

completion of the works under the contract, and secondly, that the works were executed in an

unworkmanlike manner and were left incomplete. The claimant claims that as a result of these

breaches, he has suffered loss and damage, which he identifies as reinstatement in part, cost of

remedial works and loss of rental income.

STATEMENT OF CASE

By an oral contract made on or around the period 9 September 2003 between the claimant and

the defendants, it was agreed that the second defendant would construct a six (6) bedroom

apartment building (2 two bedrooms and 4 one bedrooms) at No. 3 Macoya Road, Tunapuna

(hereinafter the “Macoya apartments”) and five (5) one bedroom apartments at No.6 Moore

Street, Pasea, Tunapuna (hereinafter the “Pasea apartments”). The total cost of construction

inclusive of VAT was agreed at $600,000.00, with a completion date set for 31 January 2004.

2. The defendants began construction of the said apartments on 10 September 2003, and on

the 20 May 2004, the claimant and the defendants agreed to further renovations (including

extensions and the construction of a swimming pool) to the claimant’s home at an agreed sum of

$400,000.00 VAT inclusive.

3. Between 10 September 2003 and 16 August 2005, the claimant paid to the defendants the

sum of $965,000.00 for works done, leaving outstanding the amount of $30,000.00. On 18

November 2005, the claimant terminated the services of the defendants on the basis of poor

workmanship and inability of the defendants to complete the projects even on an extended

timeline. As a result, the claimant claims to have suffered damages, loss of rental income and

further consequential losses.

Particulars of Damage at the Pasea apartments:

Cost of Construction of back (2nd) steps $45,000.00

Repair to water pump $2,820.00

Loss of Rental income at $7,500.00 per month

($1,500.00 x 5 from 31/01/04 to 20/05/05)- 14 months $105,000.00

of 51

Particulars of Damage at the Macoya apartments:

Cost of remedial and unfinished construction:

Swimming Pool $150,000.00

Foundations and cracks $45,000.00

Plumbing $25,000.00

Electrical $18,000.00

Grano to pool area $13,000.00

Masonry $18,000.00

Water Pump $ 2,800.00

Painting $24,000.00

$295,800.00

Loss of Rental income at $10,000.00 per month

($1,500.00 per month x four 1 bedroom apartments and

$2,000.00 per month x two 2 bedroom apartments) from

31/01/04 to 18/11/05- 22 months $220,000.00

Cost to Central Concrete Ltd. $1,250.00

Cost of Architect report $5,000.00

4. A report1 dated 26 February 2007 and prepared by one Mr. K.S. Holder, registered

architect and interior design consultant, was filed by the claimant on 20 November 2007.

However Mr. Holder was not called as a witness in this matter, nor was a Notice of Hearsay

Evidence supplied to the Court. In the circumstances, the Court is unable to attach very much

1 Report addressed to the claimant in respect of # 3 Macoya Extension, Tunapuna, which concerns, “remedial

work to the [aforementioned] project in the sum of $295,800.00 (VAT exclusive) together with a copy of our

invoice.”

of 51

weight to said report. A copy of the receipt for payment in respect of preparation of the Holder

Report in the sum of $5,000 was submitted in the claimant’s bundle of documents. Although Mr.

Holder did not give evidence in this matter, this court does not deem this expenditure to have

been unreasonably incurred since this report provided the basis for these proceedings and for

further reports to be done. This report identified the issues raised by the claimant from an

independent perspective and was also used by one Mr. S. Joseph Affoo, Chartered Quantity

Surveyor, on behalf of the defendants, in the course of the conduct of his investigations. As a

result, the cost of this report is allowed.

5. The incomplete and/ or defective works referred to by the claimant were expanded upon

in his Answers to Request for Further Information filed on 3 November 2008 and were further

elaborated upon by counsel on behalf of both the claimant and defendant in written submissions

and at the trial of this matter. The Answer to request for Further Information has therefore been

included as part of the pleadings and its contents are one of the issues to be dealt with in this

matter.

DEFENCE

6. The defendants deny that the claimant was a client of the first defendant, since at all

material times the contract was between the claimant and the second defendant only. The first

defendant was at all times the managing director of the second defendant, who alone carried on

the business of a building contractor.

7. The second defendant admits that it entered into a contract, the terms of which were

partly oral and partly in writing, for the construction of the Macoya and Pasea apartments. The

second defendant prepared conceptual floor plans, together with a breakdown of costs and a

schedule of payments which were then agreed to by the claimant. The second defendant admits

that the total costs for the works then contracted was $600,000.00 and that the date initially

agreed for completion was 31 January 2004.

8. Between 14 July 2004 and 21 July 2004, the claimant and the second defendant agreed to

vary the scope of the works to include the following:

Macoya Apartments:

8.1. The preparation and concrete paving of the driveway and the front yard;

of 51

8.2. Construction of fence walls to the north and south sides of the buildings;

8.3. Backfilling of the area between the south fence wall and the building.

Claimant’s home at No.3 Macoya Road Extension, Tunapuna

8.4. The extension and renovation of the claimant’s house;

8.5. Construction of a swimming pool and pool terrace.

9. Additional works were agreed at the cost of $400,000.00. The defendants agree that the

sum of $965,000.00 was paid to them for works done, leaving a balance of $30,000.00. The

defendants state that the claimant expressly and/or impliedly consented to several extensions of

time for the completion of the works as follows: Pasea Apartments- 20 September 2004; Macoya

Apartments- 31 October 2004; extension and renovations at the claimant’s house- 31 October

2004.

10. The defendants also claim that further extensions were granted by the claimant as

evidenced in his several letters. In respect of the Pasea apartments, the second defendant duly

completed the scope of works thereto and handed over the keys for the apartments on or about 30

September 2004. No complaints of any defects or omissions in the scope of work were identified

by the claimant at that time or subsequent thereto.

11. The second defendant duly completed the Macoya apartments and delivered the keys for

same on or about 31 October 2004. Thereafter the claimant identified the following defects:

11.1. Cracks in the external wall;

11.2. Cracks in 3 of the internal walls;

11.3. Uneven alignment of external masonry edge on concrete roof slab;

11.4. Rough surface of concrete bases to kitchen.

12. The defendants say that the above defects were corrected by the second defendant on or

before 31 January 2005. No further defects or omissions were reported by the claimant at the

time or subsequent thereto.

of 51

13. In relation to the works carried out to the claimant’s house, the second defendant avers

that as at 31 October 2004, the following items were to be completed:

13.1. Installation of pool wall and base coating (diamond brite finish);

13.2. Installation of pool equipment;

13.3. Correction of minor leaks in masonry wall.

14. The defendants aver that by December 2005 the said swimming pool was functional

and/or in use and/or that some or all of the adjacent apartments were occupied. The defendants

further contend that the second defendant was not required and/or contracted to supply and/or

install lights and/or to place “grano” in or around the said swimming pool.

15. At a meeting in or about March 2006 between the first defendant(who at all material

times acted on behalf of the second defendant) and the claimant, it was agreed that the second

defendant would waive the balance of the contract price and refund to the claimant the sum of

$60,000.00 in full and final settlement of all claims arising out of or in connection with the

incomplete works. Within about 2 days of the said meeting, the said sum of $60,000.00 was duly

paid by the second defendant to, and received by, the claimant.

16. The defendants deny that the second defendant’s building and other works were of a poor

standard and/ or that it was unable to complete all of the contract works alleged or at all and/ or

that they are liable to the claimant in the manner claimed or at all.

17. The second defendant specifically avers that it was never a part of the scope of works that

a second back step be constructed for the Pasea apartments. It further states that the water pump

was supplied and installed by the second defendant in respect of and for the supply of water to

the Pasea apartments, not to the residential building to the front of that property- which led to the

pump’s overload and malfunction. The second defendant contends that the said water pump was

functioning properly and/or effectively prior to and at the time of the termination of the second

defendant’s services by the claimant.

18. The second defendant further specifically contends that upon the handing over to the

claimant of the said apartment buildings, and in particular, the Macoya apartments, it was the

express and/or implied responsibility of the claimant to obtain the connection and/ or a supply of

electrical power thereto from the Trinidad and Tobago Electricity Commission (T&TEC)- the

of 51

second defendant having obtained the required Electrical Inspectorate Certificate of Inspection,

which was duly handed over to the claimant at or prior to the said termination of the second

defendant’s contractual services. Any delay in the connection and/or supply of such power to the

said apartments thereafter was the fault and/or responsibility of the claimant and/or was not

caused and/or occasioned by the second defendant. The claimant would have been unable to

obtain tenants and therefore rental income in respect of these said apartments in the absence of

an electricity supply therein.

19. In response to the report of Mr. K. S. Holder, the second defendant engaged the services

of Mr. S. Joseph Affoo, Chartered Quantity Surveyor, who inspected the building works and

prepared his own report dated 19 March 2009. The said Mr. Affoo sought to meet Mr. Holder to

review the said building works, but Mr. Holder was unavailable for this purpose, despite a letter

of 9 July 2007 written prior to the commencement of this action by the second defendant to the

claimant’s attorney at law in a genuine attempt to avoid litigation.

THE EVIDENCE:

20. The following witness statements were filed on behalf of the Claimant:

20.1. Davindra Maharaj, the claimant filed on 30 June 2009;

20.2. Brendon Inniss, Structural Engineer filed on 30 June 2009;

20.3. Willie Roopchan, chartered quantity surveyor filed on 30 June 2009;

20.4. Charles Melville, plumber filed on 30 June 2009.

And on behalf of the defendants:

20.5. Deoroop Teemal filed on 30 June 2009;

20.6. Anton Goodluck filed on 30 June 2009;

20.7. Stephen Joseph Affoo filed on 30 June 2009.

21. The viva voce evidence comprised all the aforementioned witnesses on behalf of both the

claimant and the defendant.

of 51

22. There are certain preliminary matters that have arisen for determination, and of necessity,

shall be dealt with before the core issues may be delineated.

PRELIMINARY ISSUES:

23. Whether the first defendant was a party to any contract with, or in any way personally

liable to the claimant?

24. Whether pursuant to an express agreement, $60,000.00 was paid by the defendant to the

claimant in full and final settlement of all claims arising out of or in connection with the

outstanding works to the various premises?

Preliminary issue 1: Whether the first defendant was a party to any contract with, or in any way personally liable to the claimant?

25. This issue is important to the question of liability, as the claimant seeks judgment against

both defendants, an approach pursued by the claimant to secure payment on his claim should

judgment be granted in his favour. It is the claimant’s position that an oral contract for services

was entered into between the claimant and both the first and second defendants. The foundation

of the claimant’s claim against the first defendant is that as a structural/ civil engineer, he had a

hands-on approach to the building works, and collected monies in his personal capacity, which

he placed into his personal accounts.

26. On the contrary, the defendants’ unequivocal argument is that the first defendant was

never a client of the claimant, the contract with the claimant having been executed with the

second defendant alone. With respect to payments, the first defendant in his witness statement

did admit to receiving money in his personal capacity2. He however justifies this direct payment,

stating that same was at the request of the second defendant, “in order to repay director’s loans

made to the company.”3

27. The absence of a written contract means that the court must look to the intention of the

parties to determine whether the contract was made between the claimant and second defendant

2 Witness statement of Deoroop Teemal dated 30 June 2009 at para. 26

3 Ibid.

of 51

alone, or whether it extended to include the second defendant’s managing director. Intention may

be gleaned from the contemporaneous dealings of the parties at the time of making the contract,

such dealings evidenced by reference to contemporaneous documents.

28. The “Breakdown of Costs- Phase 2 and Schedule Payments” which is undated, but

acknowledged by the claimant to have been prepared at the time of contracting, is so prepared

under the headnote of “TEAM ENGINEERING SYSTEMS LIMITED”. The bundle of quantity

take off sheets is prepared under a similar headnote. In a letter dated 10 September 2003,

confirming the total cost of construction in the sum of $600,000.00, the claimant addressed same

to:

“Mr. D. Teemal

Teem Engineering Systems Ltd.

Macoya Road,

Tunapuna

Dear Mr. Teemal”

29. The above is the template form utilised by the claimant in every subsequent letter to the

defendants. To my mind, that template suggests that the first defendant was written to in his

capacity as managing director of the second defendant, acting on its behalf. There is nothing in

the said letter of 10 September 2003 or any subsequent letter between the claimant and

defendants remotely indicative of the claimant’s intention that personal liability be attached to

the first defendant. I have looked at all the documentation provided to the court

contemporaneous in time to the execution of the contract between the claimant and the second

defendant, and save for four cheques totaling $155,000.00 made out to the first defendant, I am

unable to fully understand the basis on which the claimant seeks to impose liability on the first

defendant.

30. Of course, the claimant may only be trying to protect his claim, in the event that he is

successful and the second defendant becomes insolvent, but there are certain prerequisites that

must be proven to justify going behind the corporate veil and finding personal liability. To my

mind, this is the effect of the claimant naming the managing director of the second defendant in

of 51

these proceedings. While it has not at all been addressed by either side, I think some light must

be shed on the fact that instituting proceedings against a director, as is the case here, is not a

matter to be taken lightly, not least because of the costs, potential personal and professional

embarrassment involved and the flagrant waste of judicial time that is occasioned by a baseless

claim against that person in his personal capacity.

31. Lifting the veil and attaching personal liability is a very deliberate pleaded and proven

process. In Kay Aviation b.v. v. Rofe (2001) PESCAD 7 (P.E.I. C.A.), the court observed at

paragraph 25:

“The minimum level of material facts in a statement of claim founded on causes of action against an officer, director or employee of a corporation with whom the plaintiff has contracted is very high. The imposition of personal liability ... is the exception rather than the rule. To justify a departure from this rule [the] plaintiff must plead all the relevant material facts to establish there is a reasonable cause of action. In the absence of specifically pleaded material facts the action against the director, officer or employee of the corporation will be struck out.”

32. In Sylvan Lake Golf & Tennis Club Ltd. v. Performance Industries Ltd 2000 ABCA

116 (Alta. C.A), para. 23, the Court held as follows:

“The trial judge found the actions of O'Connor to be "fraudulent, dishonest and deceitful". Those findings of fact require deference on appeal. They provide the necessary support for lifting the corporate veil. As the corporate veil cannot be used as a shield for misconduct or fraud, liability may be extended to the principals of a corporation where they have engaged in this type of conduct.”

33. The claimant in the instant case has pleaded neither fraud, fraudulent misrepresentation,

nor negligent misrepresentation, nor has he provided material facts specific to such claims in this

proceeding. The action against the defendant is in breach of contract flowing from the

defendant's failure to meet timelines and for defective works. While it is accepted that it was the

first defendant who negotiated with the claimant, it appears clear on the evidence that he did so

in his capacity as managing director of the second defendant. In coming to that conclusion, I

have had regard to all the correspondence and invoices between the parties at the material time of

the contract, and as already determined above, I am unable to lend any credence to the claimant’s

claim of personal liability to the first defendant.

of 51

34. In Montreal Trust Company of Canada v. ScotiaMcLeod Inc. (1995) 129 D.L.R. (4th)

711 at 720 (Ont. C.A.), the court summarized the circumstances under which the corporate veil

can be pierced to render directors or officers of a company liable as follows:

“The decided cases in which employees and officers of companies have been found personally liable for actions ostensibly carried out under a corporate name are fact-specific. In the absence of findings of fraud, deceit, dishonesty or want of authority on the part of employees or officers, they are also rare. Those cases in which the corporate veil has been pierced usually involve transactions where the use of the corporate structure was a sham from the outset or was an afterthought to a deal which had gone sour. There is also a considerable body of case law wherein injured parties to actions for breach of contract have attempted to extend liability to the principals of the company by pleading that the principals were privy to the tort of inducing breach of contract between the company and the plaintiff: see Ontario Store Fixtures Inc. v. Muffins Inc. (1989), 70 O.R. (2d) 42 (H.C.J.) and the cases referred to therein. Additionally there have been attempts by injured parties to attach liability to the principals of failed businesses through insolvency litigation. In every case, however, the facts giving rise to personal liability

were specifically pleaded. Absent allegations which fit within the categories described

above, officers or employees of limited companies are protected from personal liability

unless it can be shown that their actions are themselves tortious or exhibit a separate

identity or interest from that of the company so as to make the act or conduct

complained of their own.”

[emphasis added]

35. In the instant case, the plaintiff's pleadings do not allege any tortious conduct on the part

of the first defendant, or conduct that takes him out of the role of a directing mind of the second

defendant exhibiting a separate entity or interest from that of the company making his conduct

his own as opposed to that of the corporate entity. It must be remembered that this is not a case

of negligence in tort against the first defendant, which had it been, may have founded a cause of

action against him. This action is rather, a straight case of breach of contract.

36. The evidence establishes that the first defendant accepted cheques made payable to him,

and while there was no evidence for his justification that said cheques were repayment of

director’s loans, it is trite law that a contracting party can direct payments to be made to a third-

party on its behalf. The fact that the first named defendant intermingled his funds with that of the

second named defendant suggests that there may be poor accounting practices in place in respect

of the second defendant's accounts. That, however, is a matter for the Board of Inland Revenue

and not for this Court. The contemporaneous documents suggest that the first named defendant

was a part of the second named defendant’s operation and, quite clearly, was the main

of 51

protagonist in the second named defendant’s operations. At this time, however, this is not

sufficient, to my mind, to render him personally liable. It must not be taken to mean that the

court in any way condones the lack of documentary evidence to support the first defendant’s

assertion, but rather a recognition that the onus was on the claimant to prove that the first

defendant’s actions were in anyway procured by fraud or misconduct to render him personally

liable to the claimant on his breach of contract claim.

37. In Kay Aviation b.v. v. Rofe supra, the court held as follows at paragraph 19:

“Therefore, persons who deal with a corporate entity, knowing the extent to which liability is limited, do not have a cause of action against both the company for breach of contract and an action against the officer or director for inducing breach of contract, which is tortious in nature and provides for a scope of damages much broader that those flowing from the breach of the contract. See: ADGA Systems International Ltd. v. Valcom Ltd et al (1999), 43 O.R. (3d) 101 (Ont. C.A.). On the other hand where directors, officers or employees of a company partake in independent tortious conduct, the individual could be liable presuming of course the proof of a standard of care and a breach of duty. The pleadings alleging such a cause of action must set forth with particularity the material facts thereby providing the factual underpinning for the cause of action. The reason for this is not only the Rules of Court, but the well established policy that in order to insure the proper functioning of commerce, the directing minds of a corporation should not have to be continually looking over their shoulder in the fear of being sued when they direct a corporation to take certain action in relation to a contract. The directing minds of the corporate entity cannot be held liable for the actions of the corporation unless there is independent tortious conduct such as fraud, deceit, dishonesty or want of authority.”

38. The claimant’s statement of case does not set forth any material facts to found a cause of

action against the first defendant. In those circumstances and in light of the clear evidence of a

contract between the claimant and second defendant only, as ascertained from the

contemporaneous documents, I am of the view that there is no viable foundation for establishing

personal liability against the first defendant, and accordingly, I dismiss the action against him.

Preliminary issue 2: Whether pursuant to an express agreement, $60,000.00 was paid by the defendant to the claimant in full and final settlement of all claims arising out of or in connection with the outstanding works to the various premises?

39. It is the contention of the defendants that in or about March 2006, the claimant had

agreed to accept payment of the sum of $60,000.00 in full and final settlement of all claims

of 51

against the second defendant arising out of the incomplete works. According to the defence, the

said sum was in fact paid to the claimant in furtherance of that agreement.

40. In written submissions filed on behalf of the claimant, it is stated that the defendants have

shown no proof of the payment of $60,000.00 to the claimant in full and final settlement of all

claims. The claimant argues that if such were the case, the second defendant’s response to the

pre-action protocol letter would have indicated this position- instead it called for an amicable

settlement. However the claimant in his witness statement explained that he did receive the sum

of $60,000.000, but this was on account of total settlement, and not the full and final settlement

itself.

41. While I do not wish to belabour this issue, it is one that I must comment upon, as it has

been explored by the second defendant as a possible defence herein, having submitted that there

was a mutual agreement between the parties that the sum of money shall be full and final

settlement of the claim. It is further submitted in the alternative, that were the second defendant

found to be in breach of its contract, the said sum of $60,000.00 ought to be taken into account in

any award of damages granted to the claimant.

42. This is an accord and settlement type situation. Perhaps the question of whether the

$60,000.00 was indeed accepted in full and final settlement would best be answered by reference

to the case of Day v. McLea (1889) L.R.22 Q.B.D. 610. The facts were that the plaintiffs made a

claim against the defendant for a sum of money as damages for breach of contract. The

defendant sent a cheque for a less amount stating that it was in full settlement of all demands.

The plaintiffs kept the cheque stating that they did so on account and brought an action for the

balance of their claim. It was held by the Court of Appeal, affirming the judgment below, that

keeping the cheque was not, as a matter of law, conclusive that there was an accord and

satisfaction of the claim, but that it was a question of fact on what terms the cheque was kept.

43. Lord Esher MR said at page 612:

“It was contended that the keeping of the cheque so sent was, a matter of law, an accord and satisfaction of the claim, and that the plaintiffs were bound either to take it in full satisfaction or to return it. The contention, therefore, was that the plaintiffs having kept the cheque must be taken in law to have accepted it in satisfaction. Upon the other side it was contended that the keeping of the cheque could only be evidence of accord and satisfaction, and that whether or not it was taken in satisfaction was a question of fact to be determined according to the circumstances of the case. That argument raises the

of 51

question whether the fact of keeping a cheque sent in satisfaction of a claim for a

larger amount is in law conclusive that there has been an accord and satisfaction. It is

said that that inference of law must be drawn even though the person receiving the

cheque never intends to take it in satisfaction and says so at the time he receives it. All I can say is that if that is a conclusive inference it will be one contrary to the truth. I object to all such inferences of law.” [emphasis added]

44. Day v. McLea is not a case dissimilar to the present. The second defendant contends that

the $60,000.00 which the claimant deducted from a default judgment (the claimant assisted the

defendant in recovering in an unrelated matter) was in full and final settlement of claims in this

matter. The claimant disputes this contention on the basis that while indeed he did retain the

money, he did so on account of the total settlement due. At paragraph 13 of his witness

statement, the claimant states, “When I received this sum ($149,740.09), I told Mr. Teemal of the

success [of the default judgment matter] and he agreed that the sum of $60,000.00 [sic] I would

deduct on account of the total settlement once he had fully calculated the figures to be agreed

and paid to me”.4

45. The important point about accord and satisfaction is that it depends on the debtor

establishing an agreement between the parties whereby the creditor undertakes the valuable

consideration to accept a sum less than the amount of his claim. As with any other bilateral

contract, what matters is not what the creditor himself intends but what, by his words and

conduct, he has led the other party as a reasonable person, in this case, the debtor, to believe: see

Bell v. Galynski [1974] 2 Lloyd’s Rep. 13 per Megaw LJ at page 15.

46. What therefore, did the claimant, by his words or conduct lead the second defendant to

believe in relation to the deducted $60,000.00? The answer lies in a letter written by the claimant

to the defendant on 16 June 2006. Having referred to the High Court default judgment, the letter

read in part as follows:

4 This is to be read against the background of what the claimant states at paragraph 13 of his witness

statement, as follows: “During the 2 year period I tried having the matter settled with the defendants from 18th

November 2005 up to the filing of this action on 20th

November 2007. I was given on many occasions the verbal

assurances by Mr. Teemal that he would settle my claim. During this period we spoke on the phone atleast twice

per month. However on each occasion I was given excuses when he told me something and I came to the conclusion

that he was saying that ‘Anton (his employee) was working out the figures, ‘Anton hasn’t completed as yet’, ‘Anton

was on holidays’, ‘He was going through some bills’, ‘The file got misplaced’, ‘he was not well as he had a heart

attack’ and several others. Even by letter...the defendants assured me of their intentions to settle my claim.”

of 51

“I am very dissatisfied with the length of time you are taking to calculate the figures so that we can settle the damages I have suffered through you.

By this letter I also acknowledge receipt of the sum of $60,000.00 which we have agreed to be deducted on account of the total settlement when you have fully calculated your figures.”

47. If the claimant at the very moment of paying in the cheque (here, by deduction) makes

clear that he is not assenting to the condition imposed by the debtor, how can it be said that,

objectively, he has accepted the debtor's offer? The debtor, herein the second defendant,

contends that it offered the $60,000.00 on the condition of full and final settlement relative to the

incomplete works. However, the absence of documentary evidence to support its claim aside, the

second defendant’s contention is ousted by the unequivocal evidence, both documentary and in

cross examination5, that the claimant did not accept the $60,000.00 as accord and satisfaction of

the claim.

48. Bowen L.J. in Day v. McLea supra, emphasised that there must be clear evidence of

accord and satisfaction in order that such a finding might be made. At page 613 of the judgment

he stated:

“It seems to me, as a matter of principle, as well as of authority, that the question whether there is an accord and satisfaction must be one of fact. If a person sends a sum of money on the terms that it is to be taken, if at all, in satisfaction of a larger claim; and if the money is kept, it is a question of fact as to the terms upon which it is so kept. Accord and satisfaction imply an agreement to take the money in satisfaction of the

claim in respect of which it is sent. If accord is a question of agreement, there must be

either two minds agreeing or one of the two persons acting in such a way as to induce

the other to think that the money is taken in satisfaction of the claim, and to cause him to act upon that view. In either case it is a question of fact.”

[emphasis added]

5 Cross examination of the claimant on the issue of the $60,000.00:

“Q: After you fired the defendant, my instructions are that you agreed that the second defendant would waive the balance of the contract fee of $30,000.00 and would pay a further $60,000.00 to you in settlement of all claims arising? A: I do not agree. Q: You accept that the balance of $30,000.00 was waived? A: He never completed the job so I did not have to pay him. Q: He paid $60,000.000? A: He did not pay $60,000.00. I deducted $60,000.00 from what I had paid him. Q: So you were paid $60,000.00? A: Yes I was.”

of 51

49. There was no agreement between the claimant and second defendant to take the

$60,000.00 in satisfaction of any claim. Neither can it be said that the claimant induced the

second defendant to think that such was the case. The contrary is true, and I cannot be more

satisfied, upon principle or authority that the money was received only on account.

50. What is also worthy of comment is that it seems to me that the defendants never truly

considered this payment as a full satisfaction of this matter since it was inserted as an

afterthought in the amended defence and was never referred to by the defendants in any response

to the claimant’s pre-action letters.

THE COURT’S VIEW OF THE EXPERT WITNESSES: A necessary preliminary

pronouncement

51. In the spirit of important preliminary observations, I must mention a matter, which

though seemingly obvious, permeates and governs this entire trial, and it is that “in the absence

of express descriptions, there will usually be implied terms that materials and workmanship shall

be of a proper standard or quality”6As further elaborated at page 305 of Hudson’s Building

and Engineering Contracts, 10th ed:

“In the absence of any special term or direction in the contract specifying the manner in which work is to be done, there is an implied condition in all contracts for work and labour that the work will be carried out with care and skill, or as it is sometimes expressed, in a good and workmanlike manner.”

52. The parties have both either brought witnesses to contest or confirm the good and

workmanlike manner in which the building works were executed. In support of all of the issues

raised by the claimant with respect to the breach of this implied term, he relied upon the evidence

of three "experts". No permission was sought or obtained pursuant to Part 33 of the Civil

Proceedings Rules 1998, as amended for the use of expert evidence by the claimant.

6 Hudson’s at pages 50=51.

of 51

53. Mr. Willie Roopchan.

53.1. Mr. Roopchan described himself as a chartered quantity surveyor of 26 years

experience who was also the holder of a Bachelor of Science degree, and a

member of the Royal Institute of Chartered Surveyors of London, England and a

member of the Institute of Surveyors of Trinidad and Tobago. Mr. Roopchan’s

report is dated 27 October 2008.

53.2. Mr. Roopchan did not impress this court with the quality of his evidence. When

cross-examined about the misalignment of the windows, he said that he saw the

misalignment with his naked eye but took no measurements. His approach to the

alignment of the windows issue was therefore quite unscientific and cannot be

viewed as reliable. With respect to the cracks complained of by the claimant, Mr.

Roopchan did not do any scientific testing either to determine whether the cracks

were active or dormant. In respect of the issue of the plug/cap for the Jacuzzi,

once again he showed that he was not very thorough in his approach as he failed

to take into account any viable alternatives. He was not able to assist this court

with respect to whether alternative caps were available on the market to be used

instead of the one which the claimant said could no longer fit the hole nor was he

able to assist this court in determining whether a suitable replacement could be

manufactured. In fact, he readily admitted that he knew of no other way to save

the Jacuzzi without even contemplating the alternatives. When it came to an

analysis of the crack in the swimming pool, once again his approach was far from

acceptable. He inspected the pool whilst it was filled with water and proceeded to

state that the crack in the pool (which he saw) would require continuous attention

yet no foundation or basis for making this statement was given. In fact, he said he

was able to reach that conclusion just by looking at the crack. He never performed

any scientific testing to determine whether the crack was an active one which

would continue to grow and require continuous attention.

53.3. This court must confess that the nature of the evidence given by this witness in

cross examination brought into doubt his professionalism which, in turn, affected

the weight of his evidence in respect of opinions expressed by him. Further, his

of 51

report failed to identify the matters required by Part 33.10 (3)7 of the CPR. To

my mind, these prerequisites are important to allow the court and all other parties

to be aware of the matters which would have engaged the mind of the expert in

coming to his findings and formulating his report.

54. Mr. Brendan Inniss

54.1. Mr. Inniss described himself as a civil engineer with a Bachelor of Science degree

in civil engineering specializing in the area of Structural Engineering.

54.2. He did not strike this court as being independently professional to the extent that

he was not able to do any sort of empirical testing to give independent data upon

which he could base his findings. A substantial amount of his information came

from the claimant himself especially in relation to the pool.

54.3. Mr. Charles Melville:

54.3.1 Mr. Melville was, by far, the most credible of the witnesses on behalf of

either side. He was the most comfortable in giving evidence and he did not

seem to be caught up in the need to be overly technical or too particular in

his evidence to the extent that he became a difficult witness.

54.3.2 Having regard to the manner in which he gave his evidence, this court was

impressed with his delivery and his forthrightness.

55. On the other hand, the defendant relied upon the evidence of:

55.1. Mr. Stephen Joseph Affoo.

55.1.1 Mr. Affoo described himself in his witness statement as a project manager/

chartered quantity surveyor/ chartered builder/ corporate building

engineer/ chartered project management surveyor. He claimed to be the

holder of a Master of Science degree in construction management and a

diploma in quantity surveying. He also claimed membership in a number

7 Pt. 33.10(3):

“There must be also attached to an expert's report copies of –

(a) all written instructions given to the expert;

(b) any supplemental instructions given to the expert since the original instructions were given; and

(c) a note of any oral instructions given to the expert,

and the expert must certify that no other instructions than those disclosed have been received by him from the party

instructing him, his attorney-at-law or any other person acting on behalf of the party"

of 51

of professional associations as set out in paragraph 3 of his witness

statement. To aid in the discharge of his instructions, Mr. Affoo utilised

the report of Mr. Roopchan and said that when he visited the premises to

do the inspection, he met the claimant, the first named defendant and the

project manager, Mr. Anton Goodluck.

55.1.2 Like Mr. Roopchan, Mr. Affoo demonstrated an approach which seemed

to be less than professional. More strikingly, however, Mr. Affoo also

demonstrated a partisan approach and seemed to be biased towards the

defendants.

55.1.3 His report seemed to suggest that the first defendant and the project

manager were present for the entirety of his inspection. However, in cross

examination, he stated that Mr. Goodluck spent only a very short time on

this site visit, as did the first defendant, and that many of the issues which

were raised by the claimant were raised after they had both left. This

seems to be rather strange in the circumstances especially since this was a

perfect opportunity for the parties to discuss all of the issues with the

defendants’ "independent professional" present.

55.1.4 Throughout his evidence, Mr. Affoo proved to be evasive and

argumentative. Very often, he would not directly answer a question easily

without trying to be too technical. For example, when he was shown page

14 of the list of the claimant's documents – which was a photograph – he

was quite evasive and argumentative about whether the column which was

shown in the photograph looked like the drawing at page 6 of the list of

documents. In his attempt to be overly technical, he went on to say that

because he had no specifications, he could not say if the column in the

photograph and the column in the drawing were exactly the same. Quite

obviously, the intent of the question was to determine if the design of both

were meant to be the same by his estimation yet he insisted on avoiding a

straight answer to the question. Later on he was asked if, in a situation

where there was no specification in respect of the design for a panel,

whether he would build a poor quality panel to which he responded "it all

of 51

depends on what the client wants". At one point in his cross-examination it

was suggested that he was being defensive in his answers because of his

manner of response. Again, in cross examination, he was shown

photographs and it was suggested that there were cracks evident in the

photographs which he said he could not agree or disagree. He was then

shown all the photographs and asked if he saw any cracks at all to which

he said that he generally agreed. He then went on to say, quite strangely,

that "I am seeing cracks but I do not know if they are camera tricks" - a

response which seemed to be totally out of sorts since there was no

suggestion of any camera tricks in a bundle of photographs which was

entered by consent into evidence. Still later on, he was specifically asked

if he carried out any tests to which he said he did not carry out any

scientific tests. He went on to admit that his observations were subject to

what a specialist in the area – such as an engineer – would have to say,

especially when he referred to the swimming pool. Even in respect of the

figure he gave for the repairs to the swimming pool, when asked where he

got the figure from he said it was derived from his experience and that he

did not have his worksheets with him to show the basis upon which he

reached the figure. In other words, he exhibited no foundation whatsoever

for his findings.

55.1.5 He, like Mr. Roopchan, made visual observations to base findings without

scientific evaluations of the problems. For example, even though he had a

spirit level in his car, he did not utilize it to do the investigation and could

not tell if the walls were bent or not. He made yet another startling

statement in cross examination, that the type of professional required to

verify the alignment of the windows was a different type of professional.

He said that the defects in a building have to be determined by an

architect. This, of course, brings into question his role then in preparing

this report since, despite his several qualifications, he was not an architect!

Quite obviously, it hardly requires an architect to determine if a window is

out of alignment – from common sense, it would take a measuring tape (to

of 51

determine if the casement is equidistant from the edges at the four corners)

and a spirit level to check the alignment of the casement within the gap for

the window. He talked about the missing cap for the Jacuzzi but did not

measure the hole. In his report, he gave a replacement value of $50 for the

missing cap. The Court wonders how he came up with this value at all. He

did not know the size of the hole in the Jacuzzi nor did he know if there

were any such caps available nor could he point to any substitutes that

might be readily available in the market.

55.1.6 What was also remarkable was that Mr. Affoo took photographs which he

annexed to his report and when it was suggested to him that none of those

photographs identified any of the issues of concern to the claimant, his

response was "I do not understand the question". When he was shown

many of the photographs, which the both sides agreed were photographs

of the subject property, he was unable to recognize many of them which

led this court to the conclusion that he was not familiar with the property

at all.

55.1.7 All in all, Mr. Affoo was even less believable than Mr. Roopchan – both

of whom, as aforementioned, exhibited a less than professional approach

to their reports and findings.

55.1.8 Mr. Affoo's particular disregard of the provisions of Part 33.10 of the

CPR, including the provision relating to the compulsory statement

required at the end of his report as defined at Part 33.10 (2) and (3), was

quite blatant, again reinforcing that he was not truly au courant with his

duties as a purported expert. This also colored his partiality towards the

defendants, in this court’s mind, in a negative manner.

55.2. Mr. Deerop Teemal- The first defendant:

55.2.1 Unlike Mr. Affoo, who had no formal training as an engineer, the first

defendant described himself as a civil/structural engineer having graduated

with a bachelor’s degree in civil engineering. However, he did not make

an assessment of his own in relation to the claimant’s complaints which

of 51

were identified in Mr. Roopchan’s report. Instead, he relied on the

findings of Mr. Affoo as stated in his report.

55.2.2 The first defendant suffered a major blow to his credibility when the issue

of the receipts/invoices for the work done arose. He initially insisted that

he was never asked for receipts by the claimant but when he was reminded

that he was taken to the Magistrate’s Court for the production of the

receipts, he tried to shrug it off unconvincingly. He then reassured this

court that he had the invoices at his office and could produce it the next

day. He did not and, instead, took the following weekend to produce

invoices which quite obviously shone through as being freshly prepared.

This one act of desperation cast a very dark cloud on the Court’s

impression of him and portrayed him as being untrustworthy.

THE CORE ISSUES:

56. Having determined that liability in this case, if any, can attach only to the second

defendant, and that there was no accord and satisfaction between the parties sufficient to dispose

of this claim, the court now proceeds on this basis to an assessment of the core issues.

Core Issue 1: The terms of the Contract: Whether there was a contract for the construction of two external staircases at the Pasea apartments?

57. It is not in dispute that a contract for services was executed between the claimant and the

second defendant. It is also not in dispute that said contract was subsequently varied to include

further construction and renovation. What is disputed however are the exact services contracted

to be executed under the original contract. This is a claim for breach of contract and in order to

determine liability, if any, and damages, the terms of the contract referable to the breach must

first be ascertained. However ascertaining these terms has proven to be quite a difficult task for

this Court, especially in consideration of the tremendous allegations of defective works and the

equally massive amount of evidence from both sides either seeking to confirm or dispute these

defects. In an effort to not only resolve the issues as to contract terms and liability, but as a

prerequisite, to unravel those issues, the court has chosen to adopt the approach of analysing the

of 51

defective works by reference to the various reports, contemporary documents, witness statements

and viva voce evidence.

58. It is trite law that he who alleges must prove. The burden is therefore on the claimant to

prove his case and that burden must be discharged on a balance of probabilities. The claimant’s

case of breach of contract is premised on the incomplete and defective works carried out by the

second defendant. To prove these works, the claimant relied heavily on two reports of Willie

Roopchan, chartered quantity surveyor, dated 27 October 2008 and 30 October 2008 (hereinafter

the “Roopchan Reports”). The Court is well aware that there is a difference in time of about three

(3) years from the termination of the second defendant’s services and the preparation of the

Roopchan Reports, and is mindful of this lapse in time in its assessment of the works at the

material time of the performance of the contract. As aforementioned, in answer to the Roopchan

Reports, the defendant obtained a report from chartered quantity surveyor, Mr. Stephen Affoo

dated 19 March 2009. The court will refer throughout its ruling to these reports in some detail.

59. The parties both agree that the original contract was for the construction of a 6 bedroom

apartment building (2 two bedrooms and 4 one bedrooms) - the Macoya apartments, and a 5

bedroom apartment building (5 one bedrooms) - the Pasea apartments, to be completed by 31

January 2004 at a total cost of $600,000.00. There is general consensus as to the variation of the

terms of the contract for certain additional works to be done at the Macoya apartments, and

extensions and renovations to the claimant’s home including construction of a swimming pool

and terrace, all at an additional cost of $400,000.00. As stated in Hudson’s supra, at page 22, “A

simple contract may be validly varied by the subsequent agreement of the parties, so long as

there is consideration to support the variation agreement.”

60. The claimant however claims that pursuant to the original contract, he agreed to, and paid

for, the construction of 2 external staircases at the Pasea apartments. Only one was constructed

and the second Roopchan Report estimates the cost of constructing that second staircase

(apparently, backsteps) to be about $15,000.00. In support of his claim, the claimant cites the

following item in the “Breakdown of Costs- Phase 1” document prepared at the time of making

the contract:

Macoya Pasea

First Floor Slab, Beams and Staircases $79,595.00 $38,556.00

of 51

61. In the Court’s view, the above does nothing to advance the claimant’s case that a second

flight of staircase was contracted to be built. It is an item broken down in very general terms and

in no way does it expressly or impliedly, speak to the number of staircases to be built at either

the Macoya or Pasea apartments. If anything, given that the cost allotted to the Macoya

apartments was twice that allotted to the Pasea apartments, one may more likely conclude that

less work had to be carried out at the Pasea apartments. This however is speculation, and it

serves the sole purpose of demonstrating the non sequitur of the claimant’s argument as to an

agreement to construct two (2) external staircases to the Pasea apartments.

62. In his witness statement, the claimant states that as a result of the defendant’s failure to

construct the backsteps, he thereafter had one constructed8. In cross examination, he stated that

said construction occurred “within the year after November 2005 when I fired them [the

defendant[s].” The claimant went on to say that he “hired someone named Raj to construct it

[the backsteps].” There is no witness statement from “Raj” or other evidence before the court on

the circumstances surrounding the subsequent construction of these back steps, and without more

than the claimant’s response of “I don’t know” in answer to the reason for this lack of evidence

in cross examination, the Court has no choice but to conclude that the claimant constructed said

backsteps of his own volition, and not pursuant to a contract on such terms. In consideration of

the very limited evidence before the Court on this issue, the Court rules that there was no

contract between the claimant and second defendant for the construction of a second staircase at

the Pasea apartments. The $15,000.00 which the claimant claims in respect thereof is therefore

disallowed.

Core Issue 2: What is the effect of the grant of extensions of time by the claimant to the defendant for completion of the building and/ or renovation works?

63. In its amended defence, the defendant averred that the claimant expressly and/ or

impliedly, consented to several extensions for the completion of works as evidenced in the

claimant’s six letters, as set out in the claimant’s Answers to Request for Further Information9.

These six letters and their respective contents were confirmed at paragraph 22 of the claimant’s

8 Para. 18(kk) of the claimant’s witness statement

9 Filed on 3 November 2008

of 51

witness statement10. The claimant however took an altogether different view of the letters and

said at paragraph 22:

“At no time did I ever grant extensions to the defendants for the completion of the apartment building. The agreed date of completion of apartments was the 31st January, 2004 and by several letters I called upon them to finish by [sic] as follows:-

Letters Called upon the Defendants to complete by

20th May 2004 15th June 2004

9th August 2004 25th August 2004

18th August 2004 31st August 2004

29th December 2004 20th January 2005

3rd February 2005 20th February 2005

5th October 2005 31st October 2005”

64. It is more than passing strange - in fact, the Court is extremely perplexed - that the

claimant admits by his own words and corresponding documentary evidence, that he extended

the time for completion, but fails to recognise this very deliberate act as an unequivocal consent

to extension of the original deadline of 31 January 2004.

65. A good starting point is the general principle of contract law, the instant being a contract

for services, that failure to perform a stipulation as to time does not differ intrinsically from any

other failure to perform11 and would normally entitle the injured party, here, the claimant- to

rescind the contract12 and sue for liquidated damages13 or affirm it and to claim further

performance14. At the point of the breach therefore, the claimant had the option to determine the

contract, but chose instead to extend the timelines for completion. This constitutes a waiver in

the sense of election on the claimant’s part and is explained by Sir Guenter Treitel in The Law

of Contract. 11th ed. 2003 at page 811 as follows:

10

Filed on 30 June 2009 11

The Law of Contract. Sir Guenter Treitel. 11th

ed. 2003 at page 826 12

Ibid. 13

See generally Hudson’s at page 638 14

Treitel supra at page 844

of 51

“A party who is entitled to rescind may indicate that he will nevertheless perform his

part of the contract. He is then said to have waived his right to rescind, or to have elected

to affirm the contract.”

66. The effect of affirmation or the failure to rescind is that each party is bound to perform

his primary obligations when that performance falls due15- in the present case, the defendant

ought to have completed the building works by the expiration of the last extended date, and the

claimant was bound to pay for those works. As observed in Hudson’s at page 638- 9, “The

power of granting extensions of time for delays, when acted upon, fixes a new date for

completion, and the obligation of the builder is then to complete by that date.”

67. It is quite evident from the claimant’s six letters to the defendant that he was very

frustrated by the non-completion of the works, and the continuous grant of extensions that he had

to employ in hopes of completion. The following extract from the claimant’s final letter dated 5

October 2005 provides some indication of the prevailing sense of frustration the claimant

experienced due to the frequent delays on the part of the defendant:

“I have undoubtedly lost all faith in your company as regards both the time and

quality [of the works] and in this regard please be informed that you are now called upon

to fully complete your projects on or before 4 pm on the 31st of October 2005 after which,

in the event that same is incomplete, I have taken the firm decision to hire another

contractor to complete same.”

68. While the claimant undoubtedly erred on the side of leniency and goodwill by the

repeated extensions of time - the present action being testimony to same- it is not open for him to

now say that he never granted extensions for the completion of works when, by his several

letters, he elected to affirm the contract, despite the defendant’s failure to comply with the

original deadline of 31 January 2004.

69. Hudson’s supra provides an apt insight of what obtains in an extension of time situation

relative to written building contracts, which I hardly doubt cannot equally be applied to oral

contracts. Page 639 states:

15

Ibid at page 855

of 51

“There is, in most contracts, no reason why subsequent additional extensions of time

should not be granted...However, it is submitted that, on the wording of most contracts,

once a stage has been reached when, allowing for full extensions of time then justified,

the works should have been completed, liquidated damages commence to run and will

continue to do so till completion, and later events which otherwise would have justified

an extension of time can no longer be relied on by the builder to reduce his liability.”

70. The effect of the claimant’s election to affirm, therefore, is that loss of income, if

awarded in respect of the Pasea and Macoya apartments, will be calculated respectively from

and upon expiration of the date of the last extension granted. With respect to the claimant’s

home, any damages awarded will be assessed in the same manner as aforementioned. On a

related issue, it may well be a point of argument that the claimant has acquiesced in any breach

of the terms of the contract, be they for non-completion or delay, if upon the expiration of the

date of the last extension granted, the claimant fails to rescind the contract. In response thereto,

the Court invokes and re-emphasises what was said at page 639 of Hudson’s supra. Any

objective analysis of the documentary evidence in this case would conclude that in consideration

of the many grants of extensions, the date of the last grant of extension is the stage which has

been reached “when, allowing for full extensions of time then justified, the works should have

been completed, liquidated damages commence to run and will continue to do so till

completion.”

PASEA APARTMENTS:

Core Issue 3: Whether the defendant completed construction of the Pasea apartments on 30 September 2004?

71. The defendant’s case is that it duly completed the scope of works at the Pasea apartments

and denied that any complaints were made as to the quality of said works on the date of handing

over the keys on 30 September 2004 or subsequent thereto. There is some dispute as to the date

of completion, the defendant citing 30 September 2004 and the claimant, 20 January 2005. I

prefer the evidence of the claimant in this regard, since by letter dated 29 December 2004 from

the claimant to the defendant- 3 months following the date the defendant allegedly handed over

the keys- the claimant, having expressed his concern at the delay in completion of both sets of

of 51

apartments, wrote, “I now call upon you to have the apartment building at Pasea and Macoya

fully ready for occupancy on or before the 20th January 2005.” This is the last correspondence

by the claimant specific to a deadline for completion of the Pasea apartments, and in the absence

of any evidence to the contrary, the Court determines 20 January 2005 as the date of extension

granted by the claimant for completion of the Pasea apartments. Any loss of income therefore, if

awarded in respect of said apartments, will take effect from 20 January 2005. By necessary

implication therefore, the Court determines that as at 30 September 2004, the Pasea apartments

were still incomplete.

Core Issue 4: Whether the claimant identified to the defendant any defects or omissions at the Pasea apartments at the time the keys to same were handed over to him, or anytime thereafter? If so, were said defects or omissions rectified by the defendants?

72. The defendant denies that any complaints were made by the claimant as to any defects or

omissions at the time of handing over the keys. In his statement of case, the claimant identified

the particulars of damage to the Pasea apartments as being relevant only to the construction of

the back steps16, repair to water pump and loss of rental income. In his witness statement

however, he identified the following additional defects: individual lock off valves installed but

lost and covered when casting aprons, improper alignment or grade of front steps, under ceiling

of steps rough and unsightly with beam bent and lack of a fire escape. These additional defects

will not be considered in any award of damages in respect of the Pasea apartments as they are

neither dealt with in the pleadings nor in the Roopchan Reports, and therefore no figures have

been ascribed for their rectification.

73. With respect to the repair to the water pump, the claimant claims that the water pump had

to be repaired at a cost of $2,820.00 due to improper wiring and connection by the defendant. He

has exhibited an invoice for said amount from one “Greenhouse Plumbing Company” dated 25

May 2005. The defendant contends that the claimant abused the pump by using it to service

another building in the front of the property and that the need for repair was not due to improper

wiring at all. The court accepts the findings of Mr. Roopchan that the wiring to the water pump

was not done to the correct voltage in that 110 V wiring was provided but the pump operates on

220 V. Mr. Affoo did not address this issue of the incorrect wiring in his report at all. Instead all

16

Already dealt with under Core Issue 1

of 51

he had to say was that the pump was working on the day he visited without directly coming to a

finding as to the improper wiring. As a result, this figure is allowed.

74. The claimant also seeks loss of rental income at $7,500.00 per month ($1,500 x 5) from

31 January 2004 to 20 May 2005, a total $105,000.00 for 14 months. As mentioned above, this

court finds that the starting date for any claim for loss of rental income must be when the final

extension expired on 20 January 200517. To calculate the period for which rental income was

lost, it is obviously necessary for the claimant to identify how long he was unable to rent the

premises as a result of the defendant’s breach of contract. The difficulty that the Court has with

this claim is that the claimant has not given any evidence in respect of when the period of loss of

rental income must come to an end. There is no evidence before this court of the date when the

claimant had the premises completed so that, even though the claimant may very well be entitled

to the loss of rental income, no cutoff point has been established by him. The date he had

suggested was 20 May 2005 but the rationale for that is not readily apparent. Regrettably, the

court cannot make an award in respect of his loss without the proper evidence – especially since

the burden was upon him to establish the parameters of his claim.

MACOYA APARTMENTS:

Core issue 5: Whether, upon handing over the keys thereto on 31 October 2004, any works remained outstanding and/ or defective, and whether such works, if any, were completed and/ or rectified?

75. The defendant contends that it duly completed and handed over the keys to these

apartments on or about 31 October 200418. Thereafter the claimant identified the following

defects, which were corrected by the defendant on or before 31 January 2005:

75.1. cracks in the external wall;

75.2. cracks in 3 of the internal walls;

75.3. uneven alignment of external masonry edge on concrete roof slab;

75.4. rough surface of concrete bases to kitchen.

17

See findings at Core Issue 3 above 18

Paragraph 10 of amended defence

of 51

76. According to the defendant, no further defects or omissions were reported by the claimant

at that time or subsequent thereto. However in the Answers to Request for Further Information,

the claimant identified the following additional defects:

76.1. Entire apartment had to be repainted at a cost of $25,000.00. The claimant gave

evidence that the apartment was repainted as a result of the Defendant painting it

in two different colours. This repainting took place some two years after

completion and this court does not find it reasonable to hold the defendant

accountable for the entirety of this repainting which, in the normal course of

things, may have been a regular part of continued maintenance of the premises.

There was no reason given as to why the repainting was not done to match either

of the already existing 2 colours. Consequently, 50% of this claim is allowed;

76.2. Defendant repainted front of apartment No.1 with a different shade of colour from

existing colour resulting in the building having 2 different shades of colour;

76.3. Wiring to portable water pump not done to correct voltage, 110 v wiring provided

but pump supplied operates on 220 v;

76.4. Lack of planning in plumbing ;

76.5. Insufficient “clean outs” and no lock off valve to connections.

76.6. Drain pipe from cesspit tank to “soak away” was installed too low;

76.7. Waste line into cesspit tilted too steep;

76.8. One door leading into and out of apartments with no fire escapes: It stands to

reason that proper fire safety guidelines ought to have been employed in the

construction of these premises. However, bearing in mind that this is not a case in

negligence but one of breach of contract, the burden is on the claimant to show

prima facie that it was a term of the contract that a fire escape be built.

Unfortunately, there has been no clear indication in the evidence that such was

indeed the case. As a result, this claim cannot be allowed.

of 51

Core Issue 6: From when should damages, if any, begin to run in respect of the Macoya apartments?

77. As aforementioned, the defendant stated that it handed over the keys to the Macoya

apartments on 31 October 2004. Even this evidence of the defendant is questionable when

viewed in light of the defendant’s own witness’ evidence. At paragraph 4 of the witness

statement of Anton Goodluck, the defendant’s project technician, he states:

“Around the end of November 2004, the works done by Teem Limited at the apartment building at 3 Macoya Road Extension were substantially completed and the keys were handed over by me to the owner, Mr. Davindra Maharaj at this time.”

78. The Court notes the discrepancy in times given by the defendant’s own witness but views

more cautiously the defendant’s contention that at the time of handing over, it had “substantially

completed” the buildings works at the Macoya apartments. This is quite obviously not the case

and the Court is asked to reject the defendant’s evidence that handing over of the keys is

indicative of substantial completion of the works. I think the defendant’s position in this regard is

that having handed over the keys, and taking into account its assertion that it “substantially

completed” the works, the claimant is said to have accepted the works as so being. At page 376

of Hudson’s, it is said thus:

“Acceptance is sometimes discussed in the context of building contracts in a sense having still more drastic consequences, since it is frequently contended by contractors that there is some general theory whereby acceptance of the work by the employer has the effect of depriving him altogether of his right to claim damages at some later time for defective or incomplete work. It is sufficient to say that even in the case of sale of goods no such rule ever existed, and that the common law right of the employer to sue for damages for any breach of contract, including the right to recover for defects in the work, can only be lost as a result of some express provision in the contract, or by operation of the doctrines of waiver or estoppels which, it will be remembered, require either consideration, or a clear representation intended to be acted upon and accompanied by an alteration of the other party’s position to his detriment. It will be seldom that facts could arise in practice, it is submitted, which would found such a waiver or estoppel.”

of 51

79. The instant is not the atypical case to found such waiver or estoppel. The claimant has

certainly not waived his right to sue for damages, and it can equally be implied that he has not

accepted the works as complete merely because of the handing over of the keys19.

80. The defendant is therefore liable for the incomplete and/ or defective works at the

Macoya apartments. The issue is identifying from when liability should attach. The claimant has

said that notwithstanding the defendant’s contention that it had substantially completed its works

by 31 October 2004, its own evidence that the Electrical Inspectorate Certificate of Inspection

was handed over to the claimant by the date of termination- 18 November 2005- is an indication

that the claimant was out of use of the apartments up until said date of termination, at the very

least. This is a reasonable inference for the Court to draw, since without the requisite Certificate

of Inspection the claimant could not have obtained electricity, and in this day and age, it is not

extravagant to assume that an apartment without electricity would hardly, if ever, be rent worthy.

81. The defendant has however stated that it handed over the said Certificate at or prior to the

the date of termination by the claimant, and therefore having discharged its duty in respect

thereof, it was then incumbent on the claimant to obtain the electricity and mitigate his losses as

to rental income. Whilst the court agrees with this argument of the defendant, it remains

cognisant of the following key points:

81.1. The Certificate is not determinative and/ or indicative of completion;

81.2. By letter dated 5 October 2005 to the defendant- almost a year after the defendant

allegedly completed the works and handed over the keys, and to which the

defendant never objected by responding in any way - the claimant gave one final

extension of time for completion of works to 31 October 2005, so that it stands to

reason, that as at 31 October 2004, the defendant had yet to complete certain

building works; and

81.3. Certain works as identified above, still remained incomplete and/ or defective at

and following the date of termination of the contract.

19

An analogous situation may be as stated in Hudson’s at page 377. “A building owner does not accept work

merely by resuming occupation or continuing in possession of the land on which the work has been carried out.”

of 51

82. Following upon the Court’s reasoning in core issue 2 above, the claimant’s entitlement to

damages for loss of income would begin to run not from the date of termination of the contract,

but from the expiration of the extended date, that is, 31 October 2005.

CLAIMANT’S HOME:

83. Except for the works listed below, the defendant denies liability for additional incomplete

and/ or defective work cited by the claimant. The defendant states that as at 31 October 2004, the

following works remained outstanding:

83.1. Installation of pool wall and base coating (Diamond Brite finish);

83.2. Installation of pool equipment;

83.3. Correction of minor leaks in masonry wall.

84. In his answers to Request for Further Information, the claimant identified the following

additional incomplete/ defective works at his home. In an effort to determine liability, it is

proposed to deal with these matters seriatim.

Core Issue 7: The various incomplete/ defective works referred to in the Further

Information.

85. Windows not symmetrically aligned within jabs –

85.1. Mr. Roopchan said that there was a total of 24 casements which were not

symmetrically aligned within the jambs and he said in his report that to remedy

the nonalignment, the steel casement of the windows had to be cut out and reset

with correct alignment to finish flush. Cement and sand mortar had then to be

applied to finish flush and the units had to be replaced as required if any was

damaged during removal. In addition,the casements had to be redecorated with 2

coats of oil paint along with the masonry with 2 coats of emulsion paint. He gave

this cost as $15,000. He was not cross examined on the reasonableness of this

value.

of 51

85.2. Mr. Affoo said in his report that only 2 windows were out of alignment and the

cost to repair those two was $2,895.00.

85.3. The issue therefore is which of the two experts should this court believe?

85.4. For the reasons mentioned above, and in particular because of the seemingly

partisan approach of Mr. Affoo, this court prefers the evidence of Mr. Roopchan

and would therefore allow the figure proposed by him. In any event, his figure

seems quite reasonable when compared to that of Mr. Affoo who quoted a sum of

$2895 to repair 2 windows amounting to approximately $1448 per window as

opposed to Mr. Roopchan's estimate of $15,000 for 24 windows at a cost of

approximately $625 per window.

86. Rendering work to eastern wall of building at ground floor level was not in one

vertical plane.

86.1. Mr. Roopchan said that it was necessary to hack the face of the wall to form a

bond and apply cement and sand render to the wall in varying thickness to bring

the surface to one vertical plane; and then to redecorate the wall with one primer

and two quotes of emulsion paint. The total area was about 320 ft.² and he

estimated the cost to be $5000. He was not cross-examined on this.

86.2. Mr. Affoo said in his report that "as there were no specifications in the contract

one cannot state that the plasterwork does not conform to an unknown

specification." As mentioned before, Mr. Affoo did not utilise a spirit level in his

assessments, and is therefore unable to assist this Court in respect of whether the

rendering work was done in one vertical plane.

86.3. Consequently, this Court accepts Mr. Roopchan's estimate that it was necessary to

do the work he mentioned at the cost of $5000.00.

87. Water seepage where aluminium windows meet masonry works along corridor

leading to back house

87.1. To repair this problem, Mr. Roopchan said it was necessary to clean out the

mortar between the Windows and masonry and apply non-hardening silicone

of 51

inside and outside. He estimated that about 120 feet of silicone was required and

the cost of this remedial work was $4000.00.

87.2. Mr. Affoo opined, however, that there was evidence of ponding on the tiled roof

to the corridor and that as there was no waterproofing to the concrete slab, it was

most likely that water seepage inside the corridor came from the ponding.

87.3. Once again, Mr. Roopchan seemed more credible in his explanation and analysis

of the problem and this Court accepts his finding in that regard. As a result, the

Court would allow the sum of $4000.00 which he claims is necessary to remedy

the problem.

88. Several cracks in rendering work at various locations throughout the building

88.1. It was quite evident from the photographs in evidence before the Court that there

were several visible cracks throughout the building. Again, Mr. Affoo seemed far

from credible when addressing the issue of the cracks suggesting at times that

they were lines on the walls which "could be cracks".

88.2. Consequently, Mr. Roopchan's estimate of $8000.00 to remedy this issue is

accepted by this Court.

89. Masonry walls in perimeter fencing separating from concrete columns; structural

cracking occurring at joints; walls and columns not in plumb and true to lines.

89.1. In respect of this issue, Mr. Inniss and Mr. Roopchan were in agreement in

respect of the need to take down the walls and columns of the perimeter fencing

as the perimeter fencing could not be repaired. It was suggested in cross-

examination of Mr. Inniss that he could not say with certainty that the wall had to

be destroyed and reconstructed. However, these are civil proceedings and the

standard of proof is a balance of probabilities rather than the criminal standard.

Mr. Affoo, once again, gave another bewildering response in cross-examination

by saying he could not agree or disagree if there were cracks on the perimeter

fencing. Having regard to the fact that Mr. Affoo deferred his opinion in the face

of a suitably qualified professional and having regard to the fact that Mr. Inniss

exhibited such qualification, this Court accepts the suggestion of the claimant's

of 51

witnesses that the perimeter fencing has to be demolished and rebuilt at the stated

cost of $69,400.00.

90. Visible hole in Jacuzzi from over cutting when fitting pipework and accessories;

water seepage through opening to underneath of Jacuzzi affecting floor finish; base of

Jacuzzi left suspended instead of packing under with sand.

90.1. As mentioned above, this Court is not satisfied with the attempts of Mr. Roopchan

to deal with this issue completely. Neither is this Court satisfied with Mr. Affoo’s

off-the-cuff comments as to the availability of replacement caps.

90.2. Consequently, this Court is not minded to award the sum of $12,000 as estimated

by Mr. Roopchan. Instead, this Court feels that a suitable replacement cap can be

manufactured. In any event, it is inconceivable that this Jacuzzi has been

inoperative for so long. Regrettably, the replacement cost of this Jacuzzi is out of

proportion to what may be a simple solution at the end of the day. This court

therefore determines that the reasonable cost of manufacturing a suitable

replacement cap be reported on to the Court by Mr. Roopchan within seven days

of this judgment.

91. Water backup through waste in bathroom lavatory basin when pool activated -

wrong connection of waste lines.

91.1. Mr. Affoo said in his report that "there was no problem with the waste water

plumbing from the lavatory basin at the time of handing over the project. There

was no problem with the waste line when we visited the site. ” This finding does

not seem consonant with a thorough investigation of the problem as he did not

mention any specific analysis of the problem.

91.2. Once again, Mr. Roopchan's evidence in respect of this issue is preferred and his

estimate of $3500.00 to remedy this issue is accepted.

92. Electrical cable leading from panel in front building to backhouse damaged when

drilling through masonry.

92.1. Once again, Mr. Affoo did not confront this issue. He said in his report that the

electrical cable was “in good working order when the building was handed over.”

of 51

It is assumed that he got this information from the Defendants. Whether or not his

words which followed were intentionally meant to be ambiguous, he followed up

his statement about the cable being in good working order in the following

sentence: "there was no electrical problem when we visited the site." Of course,

this does not specifically address the cable issue. It is a generalized statement

following a specific mention of the electrical cable. This raises some doubts in the

Court's mind as to the reason for Mr. Affoo expressing himself in this manner in

his report.

92.2. On the other hand, Mr. Roopchan was not seriously tested in this respect in cross-

examination.

92.3. On the whole, this Court prefers Mr. Roopchan's evidence in this regard as well

and will award the sum of $2500.00 to replace the cable and reconnect the supply

at both ends as stated in his report.

93. Pool structure showing crack from from top to weir.

93.1. This is dealt with in Core Issue 8 ante, under reinstatement.

94. Further complaints/issues

94.1. The following complaints/issues were referred to in the further information but

were not dealt with by Mr. Roopchan and no figures for their remedy were given

as such. Consequently, the court is unable to entertain any claim for the award of

remedial work in relation to these matters:

94.1.1 Waste line for upstairs bathroom could not be found so an unsightly one

was made protruding exterior of building.

94.1.2 Most walls of home out of plumb

94.1.3 Edges out of plumb and uneven.

94.1.4 Under ceiling not smooth and unsightly.

94.1.5 Inside of building slicked with gypsum mud to hide unsightly plastering.

94.1.6 Column with wall at southern corner of downstairs bedroom out of plumb

and noticeably unsightly (front of house).

of 51

94.1.7 Plastering uneven along corridor.

94.2. Joining of corridor with steps left with space between allowing water seepage

during rainfall.

94.3. Where corridor meets the back existing roof no wall flashing was used- instead

the existing galvanise was bent and nailed to the concrete wall resulting in heavy

leaking during rainfall.

94.4. Leaking roof in downstairs bedroom damaging gypsum ceiling.

95. With respect to the issue of whether there was an agreement to put grano in the pool area,

this Court accepts this evidence from the claimant who the Court views as a more credible

witness. As such, the Court will allow the sum of $13,000.00 for this as claimed.

96. Mr. Roopchan referred to certain unfinished work at paragraph 2 of his report which he

admitted was information given to him by the claimant. The claimant, however, never chose to

refer this court to the actual expenditure incurred by him in relation to the repairs necessary to

repair the roof and the finishings around the pool. The implication from the evidence was that the

work was completed but no explanation was given for the failure to include those receipts or

even to have the replacement builder give evidence to confirm the extent of the incomplete work.

Bearing in mind that such a builder would have been best placed to assist the court in terms of

the extent of the incompletion, this court finds it unsafe to rely upon the hearsay evidence

coming from the claimant informing Mr. Roopchan of the extent of the works required. As a

result, this Court will not award damages in this regard as in the Court’s view, the claimant has

not crossed the threshold of the requisite burden of proof.

97. Having determined that the claimant is liable in respect of certain works as discussed

above, damages will be awarded in respect thereof. General damages in the sum of $30,000.00

will also be awarded to compensate the claimant for the blatant and continuous breaches by the

2nd defendant which can only be seen as shoddy work on the whole.

of 51

Core Issue 8

REINSTATEMENT: Whether the claimant is entitled to reinstatement as claimed, or

some other measure of damage in respect of the perimeter wall, jacuzzi, cesspit and

swimming pool?

The Law:

98. In the much quoted words of Baron Parke in Robinson v. Harman (1848) 1 Exch 850,

855, “the rule of the common law is that where a party sustains a loss by reason of a breach of

contract, he is, so far as money can do it, to be placed in the same position as if the contract had

been performed.” Leaving aside the anomalous exception of punitive damages, damages are

compensatory. That is axiomatic. The claimant herein seeks compensation under the head of

reinstatement for the damage he says he sustained as a result of the defective building works

carried out by the defendant in relation to certain items. The learned author of Hudson’s

Building and Engineering Contracts supra, states at page 587:

“In the case of defective work (or work not in accordance with the contract) there are in fact three possible bases of assessing damages, namely, (a) the cost of reinstatement, (b) the difference in cost to the builder of the actual work done and the work specified or (c) the diminution in value of the work done due to the breach of contract. There is no doubt that wherever it is reasonable for the employer to insist upon reinstatement, the courts will treat the cost of reinstatement as the measure of damage.20”

99. It is this principle that the ordinary measure of damages for defective performance under

a building contract is reinstatement that the claimant has latched onto in his claim relative to the

swimming pool, perimeter wall, Jacuzzi and cesspit. However, as recognised above,

reinstatement is not the only measure of damages. In Ruxley Electronics and Construction

Ltd. v. Forsyth [1996] A.C. 344 at 367, Lord Lloyd, after quoting extensively from the

celebrated judgment of Cardozo J. giving the majority opinion in the Court of Appeals of New

York in Jacob & Youngs v. Kent, 129 N.E. 889, said:

“Cardozo J.'s judgment is important, because it establishes two principles, which I

believe to be correct, and which are directly relevant to the present case; first, the cost of

reinstatement is not the appropriate measure of damages if the expenditure would be out

20

Approved by Lord Upjohn in East Ham B.C. v. Sunley [1966] AC 406 at 445.

of 51

of all proportion to the benefit to be obtained, and, secondly, the appropriate measure of

damages in such a case is the difference in value, even though it would result in a

nominal award.”

100. What then determines whether reinstatement is the appropriate measure of damage? The

authorities emphasise the central importance of reasonableness in selecting the appropriate

measure of damages. In Birse Construction Ltd. v. Eastern Telegraph Company Ltd. [2004]

EWHC 2512 (TCC), the learned judge stated at para. 51 of the judgment:

“In my judgment it is now clear from Ruxley (and indeed many of the cases referred in the speeches) that the normal measure of damages for defective works is the cost of reinstatement (i.e. the cost of remedial works) but in every instance it has to be reasonable to apply it. Thus where that measure is out of proportion to the claimant’s real loss, then some other measure should be used. This is the case where there has been a modest effect on the utility of the works and where it would be reasonable to assess the loss on the basis of diminution of value. A pragmatic approach may have to be applied although the claimant is not to be too readily deprived of the ordinary measure of compensation.”

101. In the instant case, the cost of reinstatement is opposed by the defendant on the basis that

the claimant’s personal preference for the highest quality/ standard of work, although a factor to

be considered, cannot make it reasonable for him to demand that work which fails to meet his

standard be demolished or removed and replaced. Lord Jauncey referred to this personal

preference factor in Ruxley Electronics and observed the following at pages 358-359:

“It was submitted that where the objective of a building contract involved satisfaction of a personal preference the only measure of damages available for a breach involving failure to achieve such satisfaction was the cost of reinstatement. In my view this is not the case. Personal preference may well be a factor in reasonableness and hence in determining what loss has been suffered but it cannot per se be determinative of what that loss is.”

102. The case of Ruxley Electronics has been heavily relied upon by counsel on both sides on

this aspect of the claim, mostly because that was a case where the cost of reinstatement was

sought in respect of a swimming pool which was not built according to the contracted

specifications- a case not wholly dissimilar to the present. In Ruxley, a builder had contracted to

build a swimming pool in his customer’s garden. The contract required the pool to have a

of 51

maximum depth of seven feet, six inches but the pool actually built had a maximum depth of

only six feet, nine inches. This breach of contract did not significantly affect the value of the

pool; nor, since the pool remained, in spite of the breach, perfectly safe and serviceable, would

the cost of rebuilding it to the stipulated depth have been reasonably incurred, being wholly

disproportionate to the benefit to be obtained in carrying out these operations. Thus the customer

was entitled neither to the difference in value nor to the cost of reinstatement, but was awarded

damages for loss of amenity21. In summing up the measure of damage to be awarded, referencing

the paramount consideration of reasonableness, Lord Jauncey said at page 358 of Ruxley

Electronics:

“Thus in the present appeal the respondent has acquired a perfectly serviceable swimming pool, albeit one lacking the specified depth. His loss is thus not the lack of a useable pool with consequent need to construct a new one. Indeed were he to receive the cost of building a new one and retain the existing one he would have recovered not compensation for loss but a very substantial gratuitous benefit, something which damages are not intended to provide.

What constitutes the aggrieved party's loss is in every case a question of fact and degree. Where the contract breaker has entirely failed to achieve the contractual objective it may not be difficult to conclude that the loss is the necessary cost of achieving that objective. Thus if a building is constructed so defectively that it is of no use for its designed purpose the owner may have little difficulty in establishing that his loss is the necessary cost of reconstructing. Furthermore in taking reasonableness into account in determining the extent of loss it is reasonableness in relation to the particular contract and not at large.”

103. In determining whether the appropriate measure of damages is the cost of reinstatement

as the claimed by the claimant, this Court shall, being mindful of all of the foregoing principles,

take into account the following factors as posited in Hudson’s Building and Engineering

Contracts supra, at pages 588-589, viz:

103.1. Whether the work actually carried out is reasonably satisfactory for its purpose;

103.2. Whether the building owner has carried out or in fact intends to carry out the

work of reinstatement;

21

The court held that where there had been a breach of performance resulting in loss of expectation of

performance, satisfaction of a personal preference or a pleasurable amenity but there had been no diminution in

value the court could award modest damages to compensate the plaintiff. Although this loss of amenity award was

upheld by the House of Lords, it was recognised that that in most building contract cases, no such damages are

available to the customer: see speech of Lord Lloyd at page 374 of the judgment.

of 51

103.3. Whether the defect or omission has substantially affected either the market value

or the amenity value to the building owner of the works;

103.4. Whether the cost of reinstatement is wholly disproportionate to the advantages of

reinstatement.”

104. Hudson’s continues on page 589, “It is suggested that if, for the above reasons, cost of

reinstatement is rejected as the measure of damage, then the measure should be the difference in

cost to the builder, or the diminution in value of the works, whichever is the greater.”

The Evidence:

105. The Perimeter Wall:

105.1. This has already been dealt with above and the costs of the demolition of these

perimeter walls and their rebuilding have been allowed.

106. Jacuzzi:

106.1. This too has already been dealt with above and the claimant's quantity surveyor,

Mr. Roopchan has been given seven (7) days from the date of the judgment to

provide to the Court a cost with respect to a replacement cap.

107. Cesspit:

107.1. This Court deems Mr. Melville a credible witness and accepts his evidence when

he said that the sewer lines were too low and when he recommended that it was

necessary to dispose of the septic tank and install a new one. The Court also

accepts his evidence that the soakaway has to be disposed and a new one installed

at his stated price of $35,000.00. The Court is also minded to award, and does so

award, the cost of the three additional "cleanouts" and "lock off" valves in the

sum of $2000.00 as recommended by Mr. Melville.

108. Swimming Pool:

108.1. Following on from Ruxley, this court must admit that this has been the most

troubling issue in this matter. However, from the evidence before this Court, the

of 51

pool has been in use by the claimant ever since it was constructed. The major

defect, however, in this issue seems to be the matter of the crack which, as can be

expected, would result in the seepage of water into the pool’s foundation.

108.2. As indicated above, the court was not totally satisfied with the evidence of the

structural engineer, Mr. Innis, who failed to do proper testing, independent of the

claimant’s representations, to assist this court in what would be a reasonable

solution in the circumstances.

108.3. Consequently, the Court intends to have Mr. Inniss provide a report to this Court

within 14 days of judgment herein, bearing in mind his current responsibilities

and obligations, as to the cost of rectifying and remedying the crack in the

swimming pool. Obviously, the pool would have to be drained of water for a

proper investigation and analysis to be conducted. In the circumstances of this

case, it is this Court's view that justice requires closure to this issue, and this can

only be properly had in the manner suggested above.

108.4. At this time, therefore, this Court is not minded to order the defendants to replace

the pool unless it is absolutely impossible to repair the crack, in which case the

court will hear further evidence in that regard.

Core Issue 9:

REMOTENESS OF DAMAGE: Whether the defendant ought to be held liable for the loss

of rental income and loss of use of the buildings consequent upon the claimant’s

termination of its services?22

109. This issue affects the question of computation of time in determining the extent of the

defendant’s liability for the breaches of contract due to delay and defective works. It will be

recalled that following several extensions of time to complete the building works, the claimant

terminated the defendant’s services on 18 November 2005, and to put the time factor into

perspective- some two (2) years after the commencement of the original contract, and about a

year and a half (1 ½) following the amended contract. Following that termination therefore, the

22

The claimant’s duty to mitigate is also considered in this issue.

of 51

claimant employed the services of another contractor to complete and/ or remedy the building

works that were respectively outstanding and/ or defective. This necessarily, in the Court’s view,

raises the question of liability beyond the terminated contract, and the concept of remoteness

assumes, in the Court’s mind, a very real role in this assessment.

110. In Transfield Shipping Inc. v. Mercator Shipping Inc. (The Archilleas) [2008]

UKHL 48, the House adopted a somewhat new approach to remoteness in contract. That new

approach criticised the arbitrators’ reasoning that “what mattered was that the type of loss

claimed was foreseeable” and deemed it “too crude a test and an error of law to adopt it”: per

Lord Walker at paragraph 48 of the judgment. In that case, the ship owners had fixed the

chartered vessel for a new four to six month hire to another charterer, following on from the

current charter, at a daily rate of US$39,500. During the period of delay, the rates had fallen, and

in return for an extension of the cancellation date to 11 May, the owners agreed to reduce the rate

of hire for the new fixture to US$31,500 a day. The owners claimed damages for the loss of the

difference between the original rate and the reduced rate over the period of the fixture. At

US$8,000 a day, that came to US$1,364,584.37. The charterers said that the owners were not

entitled to damages calculated by reference to their dealings with the new charterers and that

they were entitled only to the difference between the market rate and the charter rate for the nine

days during which they were deprived of the use of the ship. That came to $158,301.17. The

arbitrators found for the owners. The appellant charterer appealed against a decision ([2007]

EWCA Civ 901, [2008] 1 All E.R. (Comm) 685) upholding the arbitrators' ruling on the

damages to which the respondent ship owner was entitled following the late return of the ship

which the appellant had chartered from it. The House, in allowing the appeal, found that the

charterer could not reasonably be regarded as having assumed the risk of the owner’s loss of

profit on the following charter.

111. Martin Dixon in the article ‘The New Test of Remoteness in Contract’ L.Q.R. Vol. 25

provides a concise summary of the approach of the House in Transfield Shipping to the concept

of remoteness in damages thus:

“It is not an external rule of law imposed upon the parties (Lord Hoffman at [9]23), instead being agreement-centred and so requiring the court to look at the ‘presumed intentions’, ‘common intention’ and ‘shared understanding’ of the parties (see [12], [24],

23

Similar bracketing herein refers to the paragraphs from the judgment in Transfied Shipping.

of 51

[36], [69] and [84]. The court must ask ‘whether the parties must be assumed to have contracted with each other on the basis that the [defendants] were assuming responsibility for the consequences of that event’ (Lord Hope at [30]), and thus identify the ‘common expectation, objectively assessed, on the basis of which the parties are entering into their contract’ (Lord Walker of Gestingthorpe at [78], i.e. what the parties would ‘reasonably have considered the extent of the liability they were undertaking’ (Lord Hoffman at [23]). Accordingly, although still relevant, forseeability of a loss as a not unlikely consequence of breach is now neither necessary nor sufficient for a finding that the loss is not too remote and therefore recoverable (see especially [9], [17], [21], [32], [36] and [84].”

112. I think the loss in Transfield Shipping, based as it was on a volatile shipping market, is

distinguishable from the present loss claimed herein, since unlike the former loss, in this case, it

cannot be seriously doubted that following termination, the claimant would have required the

services of another contractor to remedy the defective works and complete the buildings. The

expenses which the claimant would have incurred by the hire of a new contractor is to the

Court’s mind, the “kind” or “type” of loss which the contract-breaker ought fairly to be taken to

have accepted responsibility.24 At paragraphs 25 of Transfield Shipping, Lord Hoffman stated

that:“the question of whether a given type of loss is one for which a party assumed contractual

responsibility involves the interpretation of the contract as a whole against its commercial

background, and this, like all questions of interpretation, is a question of law.”

He continued at paragraph 26:

“But, as I have indicated, the implication of a term as a matter of construction of the contract as a whole in its commercial context and the implication of the limits of damages liability seem to me to involve the application of essentially the same techniques of interpretation. In both cases, the court is engaged in construing the agreement to reflect the liabilities which the parties may reasonably be expected to have assumed and paid for.”

113. The agreement between the claimant and defendant was for the construction and/ or

renovation of certain buildings. Having breached this agreement, it cannot be sensibly said that

the loss of use the claimant suffered and the additional expenses he incurred were not “within the

horizon of the parties’ contemplation”25 at the time of contracting. It is true that parties, in

making contracts, rarely contemplate the losses which would result from its breach, rather

24

Per Lord Hoffman at para. 15 of Transfield Shippping. 25

Per Lord Walker at para. 78 of Transfield Shipping.

of 51

counting the advantages they will gain from its performance. However using the agreement-

centred approach in Transfield Shipping to ascertain the “common intention” and “shared

understanding” of the parties, this Court is more than satisfied that while not expressly stated, it

must have been within the contemplation of both the claimant and defendant that termination of

the contract upon a breach would attract the unhappy consequences of loss of use of the

buildings and additional expenses to remedy and/or complete same.

114. The defendant is therefore liable to the claimant for the period that he was out of use of

his buildings and for the monies incurred to place him in use. Unfortunately, however, the

claimant did not deem it necessary to quantify those costs or to provide receipts for the extent of

the works which were completed by a third party. Therefore, despite the fact that he may have

been entitled to the same, there is no evidence of this aspect at all. As a corollary as well, there is

no evidence in respect of the completion of the work by the third party so that, as before, this

Court has no proper material upon which to award loss of rental since the court is unaware of the

period for which the loss applies.

115. On a related issue, the Court recognises the claimant’s duty to mitigate his losses. It is a

trite principle of contract law that first, the claimant must take reasonable steps to minimise his

loss; and secondly, he must forbear from taking unreasonable steps that increase his loss.26 At

page 977 of Treitel27supra, it is said as follows:

“It follows from the principle on which the ‘duty’ to mitigate is based that the duty will

normally arise only when the claimant has become aware of the breach, the duty will not

arise merely because he was careless in failing to discover it; but that such carelessness

might be relevant for other purposes e.g in making the loss (or part of it) too remote…”

116. The claimant was more than vigilant in discovering the various breaches occasioned by

the defendant, and as already stated, the loss which the claimant seeks is not affected by the

incidence of remoteness. Treitel supra, continues at page 977, “[I]f the claimant fails to take

reasonable steps to minimize his loss, he cannot recover anything in respect of extra loss due to

that failure.” Similarly, if the claimant acts unreasonably in attempting to mitigate, he cannot

26

Treitel supra at page 977

of 51

recover extra loss which he suffers as a result.28 The rules of mitigation require only that the

injured party take such steps as are reasonable.29 He therefore does not need to take steps which

would involve him in complicated litigation30or which would ruin his commercial reputation31 or

which would involve him in unreasonable expense or inconvenience.32

117. The evidence before the Court is that the claimant was anxious to have his buildings in a

state of use, and so I do not think it can be said that the claimant did not take reasonable steps to

minimize his loss or that he unreasonably augmented same. While the duty to mitigate is the

claimant’s, this Court is satisfied that the claimant has not incurred extra loss such as to disentitle

him to any part of his claim for want of mitigation.

ORDER:

118. Consequently, the Court orders as follows:

118.1. That Mr. Willie Roopchan provide to the Court within seven (7) days from the

date of judgment herein the cost of a replacement cap for the Jacuzzi.

118.2. That Mr. Inniss provide to the Court a report, within fourteen (14) days of

judgment herein, as to the cost of rectifying and remedying the crack in the

swimming pool.

118.3. The Court awards special damages in respect of the following :

118.3.1 Repair to water pump: $ 2,820.00

118.3.2 Cost of new cesspit: 35,000.00

28

Ibid. 29

Ibid at page 1018 30

Ibid at page 978 citing Pilkington v. Wood [1953] Ch. 770; The Ines [1995]] 2 Lloyd’s Rep.144 at 159 31

Ibid citing James Finlay & Co. Ltd. v. NV Kwik Hoo Tong HM [1929] 1 KB 400 etc. 32

Ibid citing The Griparion [1994] 1 Lloyd’s Rep 533; Hussey v. Eels [1990] 2 QB 227.

of 51

118.3.3 Three additional “cleanouts” and “lock

off” valves: 2,000.00

118.3.4 Realignment of 24 windows: 15,000.00

118.3.5 Plastering: 5,000.00

118.3.6 Remedying water seepage problem: 4,000.00

118.3.7 Repair to cracks throughout buildings: 8,000.00

118.3.8 Rebuilding of parameter fence: 69,400.00

118.3.9 Remedying the waste water/ plumbing

problem: 3,500.00

118.3.10 Replacement of Electrical cable: 2,500.00

118.3.11 Cost of Mr. Holder’s report 5,000.00

118.3.12 Repainting 12,500.00

118.3.13 Payment to Readymix Concrete 1,250.00

118.3.14 Installation of grano in the pool area 13,000.00

Total: $178,970.00

Less – payment on account ($ 60,000.00)

Balance $ 118,970.00.

118.4. The court also awards general damages for breach of contract in the sum of

$30,000.00.

118.5. The second named defendant to pay interest on the judgment debt as follows:

118.5.1 At the rate of 6% per annum on the special damages from the 18th

November 2005 to judgment;

of 51

118.5.2 At the rate of 12% per annum on the general damages from the 19th

November 2007 to judgment.

118.6. The claim against the first named defendant is dismissed – the claimant to pay the

1st named defendant’s prescribed costs.

118.7. The second named defendant to pay the claimant’s prescribed costs of the action.

118.8. Further hearing adjourned to 26th May 2011 at 9 am in POS 15 to deal with the

further reports directed by the court and to deal with the assessment of costs.

DEVINDRA RAMPERSAD J

Assisted by:

Shoshanna Lall

Attorney at Law

Judicial Research Assistant (JRA)

davindra maharaj judgmentfinal3 2webopac.ttlawcourts.org › ... › cv_07_04373dd10may2011.pdf ·...

Documents