International Construction Law Review
NON-PECUNIARY DAMAGES IN CONSTRUCTION CONTRACT CLAIMS: LOOKING FOR PRINCIPLES
M. Saleh Jaberi*
Partner, ESK Law Firm
Unlike compensation for pecuniary losses, the common law courts have traditionally been averse to awarding damages for non-pecuniary harm resulting from breaches of contract, as such losses used to be considered unforeseeable. However, several exceptions have developed and the courts have awarded damages for emotional distress where the main object of a contract was personal, or a breach of contract led to physical inconvenience. Although the essential nature of construction contracts is material, a review of the authorities shows that the courts have often awarded damages for non-material damage in residential building cases. This article looks for the principles and tests that have been used by the courts to award damages for non-pecuniary losses in construction cases, despite ongoing objections.
I. INTRODUCTION
One of the main purposes of the law in ancient societies was to regulate people’s behaviour and protect their property against physical damage. The primitive and punitive Code of Hammurabi, based on even older collections of Sumerian and Akkadian law, provides for economic compensation or restitution for building damage.1 The Twelve Tables, known as the first code of Roman law, and the lex Aquilia that partly displaced the Tables in the early third century BC, provided for the payment of monetary compensation for property damage.2 Several centuries of discussions have followed regarding the theory of restitution and the consequences of civil liability. However, it is believed that the distinction between pecuniary and non-pecuniary losses was not clearly drawn until the nineteenth century.3
* Dr M Saleh Jaberi is an attorney at law and a partner at ESK Law Firm. He is also the author of the book, Construction Law, and is actively involved in construction contracts. (Jaberi@esklawfirm.com). He is indebted to Mr Richard Harding KC of Keating Chambers, London, for his assistance with the finalisation of this article.
1 Sections 232 and 233 of The Code of Hammurabi (LW King trans, 1910) (ca 1750 BC) state:
“232. If it ruin goods, he shall make compensation for all that has been ruined, and inasmuch as he did not construct properly this house which he built and it fell, he shall re-erect the house from his own means. 233. If a builder build a house for someone, even though he has not yet completed it; if then the walls seem toppling, the builder must make the walls solid from his own means.”
2 Ibbetson, D, “Wrongs and Responsibility in Pre-Roman Law”, Journal of Legal History, Vol 25, No 2, August 2004, page 113. See also, “Roman Statutes”, Edited by Crawford, M, Institute of Classical Studies, London 1996, Bulletin of the Institute of Classical Studies, Supplement 64.
3 Jansen, N, “Trapped in categories: On the history of compensation for immaterial damages in European contract law”, The Recovery of Non-Pecuniary Loss in European Contract Law, Edited by Palmer, V V,
(Cambridge University Press, 2015), page 23.
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