Court Opinion

ID: 9790952
Source: CourtListenerOpinion
Date Created: 2023-08-31 02:01:54.741604+00
Date Added: 2024-06-11T07:37:32.826416
License: Public Domain

Dimmick, J.
(concurring in part, dissenting in part) — I concur in the majority's adoption of Restatement (Second) of Contracts § 348 (1981) to determine the proper measure of damages for breach of a construction contract. I further agree that defendant's Consumer Protection Act cause of *57action is appropriately remanded. I disagree, however, that remand is needed on the issue of damages for the construction defects at issue here.
It appears to me that the majority opinion gives no clear direction to the trial court. Section 348 appears to give the injured party alternative remedies, assuming defective or incomplete construction and inability to prove loss of value with sufficient certainty. As I read section 348, the trial court may award the cost of remedying all the defects if that cost is not disproportionate to the value the repairs will actually confer on the injured party. See Restatement (Second) of Contracts § 348, comment c (1981). But in some cases such an award would produce a large windfall because the injured party would not find it cost beneficial to make the repairs. Then the trial court must award only the difference in market price with and without the defects. In theory the rule is clear. In practice, where the defects range from trivial to extensive, does the trial court evaluate each defect for the cost benefit of its repair to the injured party? Or should the trial court consider the repair cost of all defects and then evaluate the proportionality of that total cost to the probable value of repair?
As written, section 348 suggests that the cost of repairing all defects should be compared to the value conferred from all repairs. The majority, however, implies that the trial court should evaluate each defect separately. This is clearly the fairest approach, one that has been approved in several jurisdictions. See, e.g., Summit Constr. Co. v. Yeager Garden Acres, Inc., 28 Colo. App. 110, 470 P.2d 870 (1970); Gerodetti v. Broadacres, Inc., 363 So. 2d 265 (Miss. 1978). But what does the trial court do with defects that are disproportionately costly to correct? Does the trial court award additional damages based on the resulting reduction in market price? If so, the market price appraisal must take into account the increase in value, if any, that will result from the correction of defects for which damages have already been awarded. One must wonder if a market price evaluation attempting to account for all these factors would *58be more than speculation.
In this case, I would affirm the trial court's award of damages. If my understanding of the procedure that the majority wishes the trial court to follow is correct, I think the trial court has already complied. Damages were awarded for defects already corrected by Hess and for repairs clearly of significant value to Hess in relation to repair costs. No damages were allowed for only those defects that the trial court found would not cause substantial loss. For these defects, the cost of repair would clearly be considerable (e.g., replacing insulation under concrete floors) and resulting benefit minimal. The disproportionality test is therefore satisfied.
Further, the trial court rejected testimony regarding the value of the condominiums as constructed. Apparently no other testimony on market price was offered. Thus, any further award based on a loss of market price due to irremediable defects is not possible. Under these circumstances, I find remand for reconsidering the construction defect damages to be useless.