IN THE COURT OF APPEAL BETWEEN MICHAEL JOSEPH DEOSARAN HOUSING & INVESTMENT TRINIDAD & TOBAGO APPELLANTS/DEFENDANTS AND

Transcription

1 REPUBLIC OF TRINIDAD AND TOBAGO IN THE COURT OF APPEAL CvA. NO. 59 OF 2002 BETWEEN MICHAEL JOSEPH DEOSARAN HOUSING & INVESTMENT TRINIDAD & TOBAGO APPELLANTS/DEFENDANTS AND WINSTON BARROW JUDITH BARROW PLAINTIFFS/RESPONDENTS CORAM: M. Warner, J.A. W. Kangaloo, J.A. S. John, J.A. APPEARANCES: Mrs. R. Van Lare for the Appellant Ms. J. Jones for the Respondent DATE DELIVERED: 10 th February, 2004 JUDGMENT Delivered by Warner J.A. Page 1 of 24

2 1. This case raised a narrow but important issue. It concerned the duty of care if any, which a land developer owed to a purchaser who entered into a contract with the developer to purchase lands at Diego Martin which were owned by the developer, together with a building, (in this case a dwelling house), which the developer promised to build and did build, according to his (the developer s) design and specifications and with his materials, on the parcel of land. 2. The plaintiffs brought their action in contract for breach of an implied covenant; and in tort, for negligence. They did not however, pursue the claim in contract and chose to leave it not argued. The learned trial judge held however that the claim in contract was statute barred, and there has been no appeal against that finding. I need only concern myself peripherally, with that issue. 3. The plaintiffs case is a claim for pure economic loss, the type of claim which has always produced a wide range of conflicting authorities in England. Although I shall refer later in this judgment in more detail to the case of Murphy v Brentwood [1991] 1 AC 398, I think I ought to extract from that judgment the concise and helpful explanation as to the characteristics of pure economic loss, in the context of this case. At page 479, Lord Bridge observed - damage to a house which is attributable to a defect in the structure of the house is not recoverable in tort on Donoghue v Stevenson principles, but represents purely economic loss which is only recoverable in contract or in tort by reason of some relationship of Page 2 of 24

3 proximity which imposes on the tortfeasor a duty of care to protect against economic loss. In my view, therefore, the principles to be applied in the instant case are to be found in Hedley Byrne & Co. Ltd. v Heller and Partners Ltd. [1964] A.C. 465; Henderson v Merrett Syndicates Ltd. [1995] 2 A.C. 145; Marc Rich & Co. v Bishop Rock Marine Co. Ltd. [1996] 1 AC 211 and Williams v Natural Life Ltd. [1998] 1 WLR 830. I shall refer to these authorities later in this judgment. 4. In their statement of claim the plaintiffs sought to recover the cost of remedial work as well as the pecuniary loss suffered as a result of the sale of the dwelling house and land, hereinafter referred to as the property, at a reduced value. The trial judge gave judgment for the plaintiffs, and in assessing damages he used the market value of the property in the year 1979, at the time of the purchase as providing some evidence of value of the premises as it should have been, that is to say, $225,000. From that figure he deducted the price for which it was sold in the year 1989 ($130,000.) and awarded the plaintiffs damages in the sum of $95,000. with interest at the rate of 3% from May 26 th 1988 to September 20 th 2000 and thereafter at the rate of 6%. 5. The defendants appealed on the issue of liability and the award of damages. The plaintiffs cross-appealed on the quantum of damages. Page 3 of 24

4 The specific issues which were agreed upon by the parties to arise for determination by this court are issues of law and fact (1) whether the defendants were under a duty to conduct a subsoil investigation, that is to carry out bores and digs in order to determine the subsurface soil conditions and to ascertain the suitability of the site. (2) whether on the facts, the failure of the defendants to carry out bores or digs fell short of the exercise of ordinary professional care and skill. (3) The measure of damages. These issues arise directly from the grounds of appeal filed by the parties. 6. Mendonca J. has comprehensively set out the facts in his judgment. I need therefore only summarise them. Background facts In 1961, members of the Jutagir family owned a parcel of land comprising 2 acres and 14 perches at Diego Martin. They obtained planning permission to subdivide it into building lots, each comprising 5000 sq. ft. or thereabout. In 1974 the defendants purchased the entire parcel and continued to develop the land by establishing roads, putting the infrastructure in place and obtaining the necessary statutory approvals. Phase (1) of the project was commenced and completed in or about Page 4 of 24

5 Five houses were built by the defendants and they were sold to various persons. 7. In 1979, in response to a newspaper advertisement, the plaintiffs offered to purchase from the defendants a lot of land comprising 4,960 sq. ft., with a house to be constructed on the land by the defendants at a total price of $225,000. This transaction represented part of the Phase (2) project. The plaintiffs duly paid the purchase price. 8. The plaintiffs house was completed in or about March By deed dated 13 th June 1980 and registered as No. 122 of 1980 the parcel of land and the building erected and standing thereon were conveyed by the first defendant to the plaintiffs, in fee simple as joint tenants. By the year 1983 cracks had begun to appear on both the substructure and superstructure of the house. Part of the boundary wall became contorted and had to be replaced. 9. The plaintiffs made a claim on their insurers, who, through their adjusters employed an engineer, Dr. Braveboy to advise them. After requesting that a pit be dug and conducting soil investigations, Dr. Braveboy discovered vegetable fill some five feet under the surface and he concluded that it was likely that the vegetable soil layer extended over a large portion of the lands thereby rendering the lands mobile and susceptible to external loads. He stated that any changes in the water content of that strata of the soil would result in vertical as well as lateral movement. According to Dr. Braveboy, it is normal that all vegetable Page 5 of 24

6 material be removed from a building site before any fill is utilized, but this was not done in this case. 10. Dr. Braveboy made certain recommendations which were not followed by the plaintiffs. The insurers settled the plaintiffs claim in the sum of $51,482. Thereafter the plaintiffs did repairs to the house and to the foundation, aimed at stabilizing the foundation. It is of some relevance that in the course of these repairs the plaintiffs discovered concrete culverts running below the surface of the lands in the area of the garage and towards and along one of the boundary walls. Stones and boulders in plastic bags were found in the culverts. At the northeastern corner of the house there were boulders covering a spring which was overlaid by galvanized iron sheets. The water from the spring flowed towards the house. The plaintiffs took steps to divert the water away from the house by installing pipes to convey the water into the waste water drainage system. This discovery had not been brought to Dr. Braveboy s attention, and the trial judge held that it would be speculative to conclude that it would have featured as a cause of the damage. 11. However, although the defendants claimed to have had no knowledge of the spring or the culverts, the trial judge found that, given the closeness of both to the surface, it was more probable than not, that even if the culverts were not placed there by the defendants that during the course of construction of the house they must have been aware of them and so too of the spring. Page 6 of 24

7 12. In 1985, repairs were completed and the property was leased to the Government of Trinidad and Tobago for occupation by its employee. The problems however resurfaced. Cracks appeared once more in the same and other areas of the house. 13. Although it was not argued in the court below, this court requested both counsel to consider whether or not the principles formulated in the leading case of Murphy v Brentwood (above), applied to the facts of this case. 14. The plaintiffs case at the trial was grounded on the expert evidence contained in Dr. Braveboy s report of the 3 rd December This evidence was not challenged. His findings, as they appeared in his report were as follows - 1. It is conceivable that the vegetable soil layer extends over a sizable portion of land in this locality. 2. This layer of soil contains a large proportion of decaying vegetable material and it is quite porous. 3. The underlying strata will be more dense and is probably gravelly-clay as elsewhere in this area. 4. Water in the soil will almost certainly saturate the entrapped vegetable layer thus increasing the volume of material in this strata as well as rendering it potentially mobile and susceptible to external loads. 5. Changes in water content of this strata of soil will result in compression of the strata, a vertical movement, as well as some associated lateral movement. Page 7 of 24

8 6. It is normal that all vegetable material be removed from a building site before any fill is utilised. This was not done here. The problem now, is to reduce the effective plan area of the unsatisfactory strata and so reduce or isolate vertical and lateral movement. 7. It is recommended that a system utilising (a) rubble drain around building and (b) short radial retaining wall with counterforts be employed; the whole, designed to maintain stable ground conditions thus allowing better control of building movement. The plaintiffs relied in the main, on the defendants failure to remove the vegetable fill, and the presence of the subterranean drain. Counsel for the defendants submitted that the developer, having observed that the quality of the soil was sandy loam, had taken that factor into consideration in determining the type of foundation. He had no knowledge of the vegetable or grassy material. Accordingly, the resulting damage to the building was not foreseeable. 14. At the outset, I ought to mention that the limitation point apart, there was clear and cogent evidence to support a claim in contract founded on a breach of an implied warranty, that is to say, a breach of duty to build the house in a good and workmanlike manner. It is indeed in this context that the trial judge s citation of the case of Hannock v Brazier Ltd. [1966] 2 All E.R. 901 was relevant. It was held that where a purchaser bought a house from a builder who contracted to build it, a three fold warranty was implied Page 8 of 24

9 (a) that the builder would do his work in a good and workmanlike manner; (b) (c) that he would supply good and proper materials that the house would be reasonably fit for human habitation and the warranty extended to materials used before the contract was signed. 15. The trial judge found that the claim in contract was statute barred. It was, however, in my view, necessary for him to go on to examine whether there was a breach of duty in tort. It is of course recognised that, since there was no exclusion or limitation of liability, it was possible for the plaintiffs to make concurrent claims in contract and tort. (See Henderson s case above at pages and CvA. No. 23 of 1991 (unreported) Bank of Commerce and Trinidad & Tobago Ltd. v David Lakhan (Administrator of the Estate of Mary Lakhan). 16. Analysis of the legal principles A convenient starting point is the case of Marc Rich (above) where it was held that whatever harm, a plaintiff suffered, in order to determine the defendant s liability in tort for negligence, the court had to consider the elements of foreseeability and proximity, and whether it was fair, just and reasonable to impose a duty of care on the defendant. Page 9 of 24

10 17. In Marc at page 235, Lord Steyn observed that these principles of law had been settled since the decision in Dorset Yacht Co. Ltd. v Home Office [1970] A.C Since however, in the instant case, it was common ground that the damage consisted of economic loss, further proof beyond the criteria of foreseeability was required. 18. Before I refer to what I consider to be the other governing principles I must consider the leading case of Murphy v Brentwood (above) which comes into focus in any case in which, as in the present, a claim is made for damages for economic loss. Although this case related primarily to liability alleged to have been incurred by a local authority for approving plans negligently prepared by an engineer employed by a developer, the principles are of much wider application. A house of seven judges presided over by the Lord Chancellor was convened and it subsequently overruled Anns v Merton London Borough [1978]A.C. 728, its own decision which had stood for twelve years. Briefly, in Anns, a remedy in tort was held to have been available to an occupier who found that a house he had purchased was built on defective foundation. Under the doctrine, espoused in Anns, a householder of a house, whether first or subsequent purchaser could recover anticipatory costs against the person responsible for structural defects - that is to say, the builder or the person responsible for enforcing building regulations, not only for personal injury but for the cost of Page 10 of 24

11 remedying defects. Lord Wilberforce in delivering the leading judgment referred to the two stage process - that is whether there was the sufficient relationship of proximity and secondly, whether any considerations were present to negate, reduce or limit the duty. The upshot of that decision (Ann s) was that there was support for new areas of liability in the tort of negligence under a new and broader approach. 19. In Murphy, the facts were that ABC Homes as part of a large development, built some 160 dwelling houses on a sloping site which had to be filled and levelled. Conventional foundation was not used. A concrete raft foundation was cast below the surface level, and filled. It proved to be inadequate. The plaintiff purchased his home in By 1981, the foundation had become distorted and cracks appeared in the walls of the house. 20. The plaintiff claimed damages for negligence against the District Council which had approved the plans. He was awarded damages in the sum of 35,000. the loss he sustained on resale of the house in its defective state. The Court of Appeal upheld the decision on the basis of Anns. The decision was reversed by the House of Lords. It was held that no action in negligence could be brought by an owner occupier of a defective building against persons who were concerned with its construction, including the local authorities unless the building had caused personal injury or damage to property other than the building itself. Page 11 of 24

12 21. What however, is of most relevance to the instant case is that in all the speeches in Murphy, claims for economic loss based on the voluntary assumption of liability under Hedley Byrne principle was clearly recognized. (See in particular speeches of Lord Keith at 468 and Lord Bridge at 481). 22. While therefore there was a proximate relationship between the plaintiffs and the defendants that reasonable care be exercised with respect to the building including the foundation, the question was whether that relationship and duty of care, extended to economic loss suffered by the plaintiff. 23. The law was later developed in Henderson v Merrett Syndicates when the theory of assumption of responsibility, which was rejected in the case of Smith v Eric Bush [1989] 2 All E.R. 574 was restored. 24. In Henderson Lord Goff at page 180 had this to say In subsequent cases concerned with liability under the Hedley Byrne principle in respect of negligent misstatements, the question has frequently arisen whether the plaintiff falls within the category of persons to whom the maker of the statement owes a duty of care. In seeking to contain that category of persons within reasonable bounds, there has been some tendency on the part of the courts to criticise the concept of assumption of responsibility as being unlikely to be a helpful or realistic test in most cases (see Smith v Eric S. Bush [1990] 1 A.C. 831, , per Lord Griffiths; and see also Caparo Industries Plc. V Dickman [1990] 2 A.C. 605, 628, per Lord Roskill). However, at least in cases such as the present, in which the same problem does not arise, there seems to be no reason why recourse should not be had to the concept, which appears after all to have been adopted, in one form or another, by all of their Lordships in Hedley Byrne [1964] A.C. 465 (see e.g. Lord Reid, at pp. 483, 486 and 487; Page 12 of 24

13 Lord Morris (with whom Lord Hodson agreed), at p. 494; Lord Devlin, at pp. 529 and 531; and Lord Pearce at p.538). Furthermore, especially in a context concerned with a liability which may arise under a contract or in a situation equivalent to contract, it must be expected that an objective test will be applied when asking the question whether, in a particular case, responsibility should be held to have been assumed by the defendant to the plaintiff see Caparo Industries Plc. V Dickman [1990] 2 A.C. 605, 637 per Lord Oliver of Aylmerton. In addition, the concept provides its own explanation why there is no problem in cases of this kind about liability for pure economic loss; for if a person assumes responsibility to another in respect of certain services, there is no reason why he should not be liable in damages for that other in respect of economic loss which flows from the negligent performance of those services. It follows that, once the case is identified as falling within the Hedley Byrne principle, there should be no need to embark upon any further enquiry whether it is fair, just and reasonable to impose liability for economic loss. (Emphasis added) It is also useful to mention Lord Browne- Wilkinson s observations in White v Jones [1995] 2 AC 207 at 273. He stated Just as in the case of fiduciary duties, the assumption of responsibility referred to is the defendants assumption of responsibility for the task not the assumption of legal liability. Even in cases of ad hoc relationships, it is the undertaking to answer the question posed which creates the relationship. If the responsibility for the task is assumed by the defendant he thereby creates a special relationship between himself and the plaintiff in relation to which the law (not the defendant) attaches a duty to carry out carefully the task so assumed. Later in Williams, (above) Lord Steyn in a concise judgment under the rubric The theory of the extended Hedley Byrne principle, said at page It is clear, and accepted by counsel on both sides, that the governing principles are stated in the leading speech of Lord Page 13 of 24

14 Goff of Chieveley in Henderson v Merrett Syndicates Ltd. [1995] 2 A.C First, in Henderson s case it was settled that the assumption of responsibility principle enunciated in Hedley Byrne & Co. Ltd. v Heller & Partners Ltd. [1964] A.C. 465 is not confined to statements but may apply to any assumption of responsibility for the provision of services. The extended Hedley Byre principle is the rationalisation or technique adopted by English law to provide a remedy for the recovery of damages in respect of economic loss caused by the negligent performance of services. Secondly, it was established that once a case is identified as falling within the extended Hedley Byrne principle, there is no need to embark on any further inquiry whether it is fair, just and reasonable to impose liability for economic loss: p Thirdly, and applying Hedley Byrne, it was made clear that - reliance upon [the assumption of responsibility] by the other party will be necessary to establish a cause of action (because otherwise the negligence will have no causative effect) (p.180) Fourthly, it was held that the existence of a contractual duty of care between the parties does not preclude the concurrence of a tort duty in the same respect. (Emphasis added) 25. The findings of the trial judge For ease of reference, I shall summarise the trial judge s significant findings of fact 1. that the defendants attempt to suggest that the damage was caused by blasting in a nearby quarry was a recent fabrication. 2. that the cause of the damage in 1983 and 1988 was the presence of the porous material (vegetable fill) below the foundation. The existence of such material resulted in unstable Page 14 of 24

15 conditions and impacted adversely on the load bearing capability of the soil. The land was prone to foundation movement. 3. that the defendants must have become aware of the culverts and spring under the surface, during the course of construction. 4. that the design was not suitable. 26. Application of relevant principles to facts Although the actual text of the advertisement for sale was not adduced in evidence, it was common ground that the defendants offered to provide financing to prospective purchasers. This offer in my view, demonstrated the defendants strategy to make the offer attractive to purchasers. It is also a reasonable inference, that the first defendant, having shown to the first plaintiff the five houses in Phase (1) which he had completed, would have used that achievement to encourage the plaintiff to take part in the second phase of the development. 27. In examination-in-chief, the first defendant in his evidence concerning the preliminary matters connected with the sale, said - I requested Mr. Barrow to check for his mortgage and to select a colour scheme.. I gave Mr. Barrow a copy of the house plan together with receipt for down payment and the land plan for the phase. Page 15 of 24

16 28. The plan was therefore a contemporaneous document which was submitted by the defendants as owner/builders to the building authority for its approval. The plan referred to foundation detail, an item for which, as the evidence shows, the first defendant specifically assumed responsibility. He testified as follows - The soil is referred to as sandy loam. The soil condition played a part in the foundation used. That type of soil required the laying of ground because similar to Westmoorings. The ground plans were provided for in the plans. As regards the preparatory work, the defendants were responsible for clearing the land for development. He testified We cleared six inches off the land after cutlassing it.. all my lots were cleared in one day.. after the site was cleared.. we filled the house site with 20 loads. The first defendant also accepted in cross-examination that it was not proper procedure to cover down a spring and build on it. 29. The first defendant has had thirty-four years experience as a contractor. Both defendants had experience in the development of residential buildings. They arranged for the plans to be drawn and they obtained the necessary approvals. They used what they considered to be the appropriate structural, mechanical, geotechnical and engineering procedures. They secured the building material. Page 16 of 24

17 30. The trial judge had to determine on that evidence, whether the appropriate standard of care and skill had been met before the foundation was constructed. The defendants relationship with the plaintiffs was multi-faceted. They were vendors, developers and building contractors. Clearly, the situation demanded the use of special skills and competence. The standard of skill was that of a person of ordinary competence exercising the same calling. The defendants, having undertaken the task of developing and building, would therefore have been expected to exercise the skill and competence of an ordinary competent practitioner of the relevant calling. (See Bolam v Friern Hospital Management Committee [1957] 1 WLR 582 at 586). 31. In deciding what the appropriate standard of skill was, the trial judge was presented with the unchallenged evidence of Dr. Braveboy, whose finding was that the vegetable fill extended over a sizeable portion of land in that locality and ought to have been removed. It is clear to me that an ordinary prudent and reasonable person would have foreseen that to build on vegetable fill, was inherently risky and would ultimately result in damage and loss. 32. If the defendants did not have the necessary skill, then they ought not to have been engaged in the business of development and construction. If, as the first defendant testified, on a visual inspection, he concluded that a certain type of foundation was appropriate, without Page 17 of 24

18 having carried out the necessary bores and digs, then he had not fulfilled his obligations as a developer. 33. The defendants had clearly assumed responsibility for the suitability of the site, the plans, the quality of earth fill and workmanship. As subsequent events proved, the defendants did not carry out a full investigation of the site. Lord Steyn in the recent case of Phelps v Hillingdon London Borough Council [2000] WLR 776, in considering whether a local authority, and a psychologist employed by them owed a duty of care to provide educational services of children at school at 791E said It is sometimes said that there has to be an assumption of responsibility by the person concerned. That phrase can be misleading in that it can suggest that the professional person must knowingly and deliberately accept responsibility. It is however, clear that the test is an objective one... The phrase means simply that the law recognises that there is a duty of care. It is not so much that responsibility is assumed as that it is recognized or imposed by the law. The concept was applied by this Court in the Bank of Commerce case (above), where the appellant bank had failed in its undertaking to remit certain insurance payments under a standing order which the respondent plaintiff had signed in favour of the insurance company. This Court upheld the trial judge s finding that the bank was negligent. The claim in contract was held to be statute barred. Hamel-Smith J.A. citing a passage from the speech of Lord Goff in Henderson, at page 180, Page 18 of 24

19 emphasised that the principle of assumption of responsibility extended beyond the provision of information and advice and included the performance of services. 34. Reliance by the plaintiffs upon the assumption of responsibility In Williams (above) Lord Steyn at page 836 warned that if reliance is not proved, it is not established that the assumption of personal responsibility had causative effect. The governing principle is to be found in Hedley Byrne at pages 502 and 503. The issue of reliance, in my view, was explained in the speech of Lord Morris when he said - Furthermore, if, in a sphere in which a person is so placed that others could reasonably rely upon his judgment or skill or upon his ability to make careful inquiry, a person takes it upon himself to give information or advice to or allows his information and advice to be passed on to another person who, as he knows, or should know will place reliance on it, then a duty of care will arise. It is clear that the plaintiffs accepted that the defendants undertook all aspects of the work, from the ground up, and from start to completion. In the final analysis, the trial judge s finding that the defendants were in breach of their duty of care can be supported on the evidence. 35. I do not think that it can be reasonably advanced that the pleading was deficient. As I see it, in the plaintiffs plea that the defendants Page 19 of 24

20 warranted that the premises would be reasonably fit for habitation could only refer to an implied commitment to the plaintiffs, and accordingly reinforces the assumption of responsibility aspect of the case. In this regard Lord Goff, in Henderson, observed that assumption of responsibility may and frequently does occur in a contractual context. As Lord Steyn observed at page 835 in the Williams case. The touchstone of liability is not the state of mind of the defendant. An objective test means that the primary focus must be on things said or done by the defendant or on his behalf in dealings with the plaintiff. In my view, the extended Hedley Byrne principle was clearly engaged. Everything done by the defendants or on their behalf fulfilled the criteria set out in the authorities to which I have referred. 36. The New Zealand position It is also useful to mention the case of Invercargill City Council v Hamlin [1996] A.C. 624 where the Privy Council upheld the decision of the New Zealand Court of Appeal in a building case. The New Zealand Court held that a local authority owed a duty to the plaintiff in respect of its inspection of defective foundations of a house which ultimately caused economic loss. In the Privy Council Lord Lloyd cited several authorities which were decided in the New Zealand Courts over a twenty-year period, which Page 20 of 24

21 concerned building cases and economic loss suffered by reason of defects. 37. It was held that since the common law adapted itself to the differing circumstances in which it had taken root, the Court of Appeal, in New Zealand, ought not to be deflected from developing the common law as was appropriate in its own setting. Their Lordships also took cognizance of the fact that in New Zealand, there was no legislation corresponding to the Defective Premises Act 1972, which was enacted in England, and which gave statutory protection to home owners. Therein lay the Privy Council s rationale for upholding the New Zealand court s refusal to apply Murphy. In this jurisdiction, there is as well, no similar legislation. I am however, content to decide this case on the assumption of responsibility and reliance principle for the reason that the facts of this case to my mind, indisputably point in that direction. 38. Damages The trial judge assessed damages on the basis of the difference in the value of the building as it should have been less its value as it was at the time of damage. It is to be recalled that the plaintiffs purchased the property for $225,000. and sold it for $130, The only evidence on damages was from a Report signed by Louis E. Kenny, an Appraiser and Certified member of the International Institute Page 21 of 24

22 of Valuers. The Report is dated 25 th April It appears to have been accepted without challenge. 40. The area in which the trial judge went wrong, however, was to have used the date of the purchase of the property by the plaintiffs as providing some evidence of the value of the property as it should have been. The trial judge in his judgment had this to say So far as the 1983 appraisal is concerned, 1983 was at or near the end of a period of relative prosperity for the country which saw an increase in the prices of real estate from year to year may have marked the end of that period but prices of real estate were still buoyant. There was however, no evidence to support this finding of fact. 41. The Valuer estimated that the value of the property as it stood was $400,000. In fact, he stated that the building was in good solid condition. The evidence however does not bear out that fact. The function of an expert witness is to assist the court on technical matters, so that it could form its independent judgment based on the facts proved in the case. In a valuation matter of this nature, I am of the view that the evidence of the Valuer would have been of more assistance to the court had he made his findings against the background of an engineering report, not necessarily Dr. Braveboy s. When therefore, he reported that the house was in good solid foundation in I have serious reservations about that conclusion and ultimately, his finding that the value of the house in 1983 was $400,000. The plaintiff testified that the tenant Page 22 of 24

23 who occupied the house complained about its state, and the fact that the occupants had endured the hardship for quite some time. Interestingly, the Valuer advised that homes in the area were in the range of $250,000 to $400,000 bracket. I am not however, prepared to use the higher end of the scale, in the light of the defective condition of the house and the fact that there were complaints about other houses in the development. It is of significance that Dr. Braveboy had concluded that vegetable soil layer extended over a sizeable portion of land in the locality. In my view, it is more appropriate to fix the value it would have fetched, at the lower end of the scale, that is to say $250, Order I would therefore deduct $130,000 from $250,000. and award the plaintiffs damages in the sum of $120,000. instead of $95,000. as awarded by the trial judge, with interest at the rate of 3% from May 26 th 1988 to September 28 th 2000 and thereafter at the rate of 6%. The appeal is therefore dismissed and the cross appeal, in respect of the quantum of damages is allowed to the extent that I have indicated above. Page 23 of 24

24 43. Costs The appellant will pay the respondents costs on the appeal and cross appeal. Margot Warner, Justice of Appeal I have read the judgment of Warner J.A. and I agree with it and do not wish to add to it. W. Kangaloo, Justice of Appeal I have read the judgment of Warner J.A. and I also agree with it and do not wish to add to it. S. John, Justice of Appeal Page 24 of 24