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Deciding the basis on which damages should be assessed is often a relatively straightforward matter, even if the final amounts are arguable, writes Sue Lindsey.

For example, damages for a contractual claim for defective building work will usually be measured as the cost of putting it right, although there may be debate about whether the extent or cost of the remedial works claimed for are entirely reasonable.

But dif'culties can crop up, making it important to think each time about what it is that the damages are compensating. Remember Ruxley v Forsyth (1996), in which the House of Lords rejected the contractual claim for the cost of rebuilding a swimming pool in Kent which had been built 46cm too shallow. They held that rebuilding was unreasonable, as the swimming pool was perfectly serviceable and its lack of depth had no adverse effect on the value of the property.

A different swimming pool cropped up in a decision of the Privy Council about damages in January this year, in connection with a problem far removed both geographically and legally from that of Mr Forsyth. On appeal from the Court of Appeal of Jamaica, Horsford v Bird (17 January 2006) concerned the building of a house and pool in Antigua by Mr Bird, the then Prime Minister of Antigua and Barbuda. Unfortunately, the boundary wall of the property strayed onto Mr Horsford's land, in effect appropriating 42m 2 of it.

The court at first instance refused Horsford's request for an injunction to remove the wall. The question then was how much was to be paid in damages, and that issue found its way to the Judicial Committee of the Privy Council.

Their Lordships acknowledged that the same bit of land can have different values to different people. The Court of Appeal had assessed damages on the basis of the value per m 2 of Mr Horsford's undeveloped land next door.

But the Privy Council took into account the extent to which the encroached-upon piece of land had enhanced the value of Mr Bird's house.

The extra 42m 2 accommodated a pathway which was wide enough for a vehicle to get around the edge of the swimming pool, and for an area of garden between the pathway and the boundary wall. If Bird had been made to give the land back, this layout would have been compromised.

Furthermore, the demolition and rebuilding of the boundary wall would have cost Bird a considerable sum.

The Privy Council assessed the damages on the basis of how much Horsford could reasonably have asked Mr Bird to pay for the extra land when he realised that the wall was in the wrong place.

They concluded that the sum was double the value per m 2 of the rest of Horsford's land.

When they added an amount for 'rent' for the appropriated land to the award of damages, Horsford was about three times better off as a result of his trip to see their Lordships.

Sue Lindsey is a barrister at Crown Of' ce Chambers. Visit www. crownofficechambers. com

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