Rivers v. Deane
Supreme Court of New York, Appellate Division
209 A.D.2d 936 (1994)
Rivers (plaintiff) hired Deane (defendant) to build an addition to his home, but Deane's construction was so faulty that it could only be fixed with substantial additional work. Rivers sued for breach of contract, and the trial court applied the 'difference in value' rule, awarding only $10,000 based on how much less valuable the finished addition was compared to what was promised. Rivers appealed, arguing that measure understated his actual damages.
Whether, when a construction-contract breach is substantial enough to render the finished building partially unusable and unsafe, damages should be measured by the market price of completing or correcting the work rather than by the diminished value of the building.