Fitt v Woburn Land Rover Ltd & Ors

Damages for breach of contract aim to place the claimant, so far as money can, in the position that performance would have produced. They are generally assessed at the date of breach, or, where the claimant was unaware of the breach, when it should reasonably have been discovered, unless that would cause injustice. Where loss cannot be quantified precisely, the court must make the best assessment possible on the available evidence. A claimant seeking damages based on diminution in market value must provide evidence of the relevant values. Repair costs may inform the assessment but do not necessarily determine the recoverable loss.

The claimant purchased a new Land Rover from the first defendant, financed by the second defendant and manufactured by the third. Corrosion was discovered approximately 18 months after purchase. The county court found the second defendant in breach of contract and awarded £3,000 damages and interest of £779.01, assessing the loss by reference to the reduction in market value when the corrosion was discovered.

The claimant sought permission to appeal, arguing that the discount was too low, that the corrosion had been discovered earlier, and that the trial judge had improperly restricted questioning of the defendants’ experts. The central issue was whether the assessment of damages involved an error of law or was open to challenge on the evidence.

1. Application refused. The county court judge had made a rational assessment of the evidence and there was no real prospect that a full court would interfere with the award.
2. Damages for breach of contract are intended to place the claimant, so far as money can, in the position that performance would have produced. Where the evidence does not permit precise quantification, the court must assess the loss as best it can on the available evidence, applying the principle stated in Tai Hing Cotton Mill Ltd v Kamsing Knitting Factory [1979] AC 91.
3. Damages are ordinarily assessed at the date of breach. Where the claimant did not know of the breach, assessment will usually be made at the date when the breach should reasonably have been discovered, unless that approach would cause injustice.
4. The judge was entitled to assess the loss by reference to diminution in market value at the appropriate date. The claimant had produced no evidence of the vehicle’s value as it should have been and its value with the corrosion. Repair costs were relevant evidence but were not the measure of loss and could not be used to assess the vehicle’s condition at a later date.
5. The judge’s findings that the corrosion was discovered in early 1997 and that a £3,000 discount represented the best estimate of the market reduction were rationally open to him. The complaints about the factual finding and the conduct of the trial were unsupported and disclosed no arguable error.

Order: application for permission to appeal refused.

• Court of Appeal (Civil Division): Permission to appeal from the Milton Keynes County Court was refused. The county court’s award of £3,000 damages and £779.01 interest therefore stood.