Contracts II, Pages 1059–1060

Jacob & Youngs v. Kent

Court of Appeals of New York, 1921

Facts:

Plaintiff built a residence for defendant. Defendant moved in, and after nine months he learned that some of the pipe was not made in Reading like the contract specified. The makes of pipe were practically identical and only distinguishable by the name stamped on them every six or seven feet. Defendant's architect directed plaintiff to redo the pipe work, despite it already being already sealed in the walls. Plaintiff refused and sued for the remainder of his payment.

Procedural History:

The trial court excluded the evidence about the pipes' identicalness and directed a verdict for the defendant. The appellate division reversed and granted a new trial.

Issue:

What damages are owed when the breach causes no difference in value and would be costly to fix?

Rule:

Ordinarily damages are measured by the cost of replacement, but this is not the case if the cost is grossly and unfairly out of proportion to the good to be attained. Then the measure is the difference in value.

Reasoning:

Requiring plaintiff to replace all of the plumbing in defendant's finished house with equivalent plumbing would be grossly and unfairly out of proportion to the good it would attain.

Holding:

If the breach does not cause a difference in value and would cost a grossly and unfairly proportional amount, there are no damages. Affirmed with all costs.

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