ROYAL COURT
(Samedi Division)
29th July 1999
Before: B I Le Marquand Greffier Substitute
BETWEEN Two Retraite de la Mielle Limited PLAINTIFF
AND Bedell & Cristin Executors Limited
(formerly known as B&C Executor & Trustee Company (Jersey) Limited)
(by counterclaim) DEFENDANT
Assessment of damages in relation to carpets which were damaged by the former tenant’s dog
Advocate R.G.S. Fielding for the Plaintiff in the counterclaim
(hereinafter referred to as "the Plaintiff")
Advocate S.J. Young for the Defendant in the counterclaim
(hereinafter referred to as "the Defendant")
JUDGMENT
THE GREFFIER SUBSTITUTE: The defendant is the executor of the estate of the late Mrs Shilston, who died in 1993. Mrs Shilston sub-leased the flat known as Two Retraite de la Mielle from the plaintiff for a period of six years from 25th March, 1998 to 24th March, 1994. Prior to Mrs Shilston’s death, her dog urinated on the carpets in many places. The defendant is the executor of the estate of the late Mrs Shilston. Mrs Shilston had paid a deposit of £5,000 upon the signing of the original lease in March 1998 and under the terms of clause 1.9 of the original sub-lease the sum of £5,000 was to be held by the plaintiff in a deposit account and to be applied towards the settlement of any breakages, losses or damage caused to the Flat or to all or any of the plaintiff’s fixtures, fittings and furnishings through the fault or negligence of Mrs Shilston, her servants agents or invitees which deposit was to be returned to Mrs Shilston together with any interest which may have accrued thereon at the determination of the sub-lease or be forfeit in part or in whole in compensation for such damage, losses or breakages without prejudice to any further claim which the plaintiff may have against Mrs Shilston for such damage, losses or breakages.
Mrs Lincoln, who is the sole beneficial owner of the plaintiff, discovered the damage to the carpets soon after the death of Mrs Shilston. However, the defendant found an alternative tenant, a Mr Egglishaw, who completed the tenancy of Mrs Shilston. Mr Egglishaw then sub-leased the premises for 1 year ending in March 1995 and Mrs Lincoln gave evidence that the plaintiff did not suffer any loss of rental during that period by reason of the state of the carpets. Subsequently there was a further tenant who sub-leased the Flat together with the original carpets and that tenancy ended in early 1996. Again, Mrs Lincoln gave evidence that the company did not suffer any loss of rental during that period by reason of the state of the carpets.
The carpets were first inspected by Mr Richard Allen of ARC Carpets some time in 1993. Mr Allen gave evidence, which was corroborated by Mrs Lincoln and not challenged by the defendant, that the initial carpets were high quality carpets and that both the Flat itself and the general furnishings thereof were of high quality. Both Mr Allen and Mrs Lincoln gave evidence that all the carpets in the Flat were badly stained. Mr Allen, who has worked in the carpet industry for 41 years, was firmly of the opinion that both the carpets and the underlay required replacement. Mr Allen had not examined the condition of the underlay but gave his opinion that this also would have been stained. Advocate Young cross-examined him as to whether it would be possible to cut out the stained areas of the underlay and to patch up the areas cut out. He was firmly of the opinion that this would be uneconomical because of the time which would be involved in cutting out the parts involved, cutting appropriate patches and fitting the same.
Mr Allen gave evidence that ARC Carpets had produced various quotations for replacement carpets. The earliest of these, dated 19th January 1995, did not include replacement of the underlay and was for a sum of £5,587.50. From the quotation dated 3rd February, 1997, it is apparent that the 1995 quotation was based upon 1993 prices. From the quotation dated 4th June, 1997, it is apparent that the cost of new underlay in 1993 would have been £477.75.
Mr Allen, who was a convincing witness, gave it as his opinion that the normal useful life of a carpet of this quality would be 20 years.
Mrs Lincoln moved into the Flat personally for the first time in early 1996. She gave evidence that she was extremely dissatisfied with the condition of the carpets but that she put up with these for the following 2 reasons:-
(1)Because she felt it necessary to retain the carpets as evidence of the stains as, at that time, and indeed until April, 1999, when the defendant admitted liability in relation to the carpets, liability for the damage to these was not admitted.
(2)Secondly, because she thought that the matter should be treated in the same way as an insurance claim and that if the defendant had to pay for new carpets then they would be entitled to have these.
An action was commenced by the defendant in 1994 for the return of the deposit of £5,000 together with interest thereon. This led, eventually, to an agreed judgment being taken against both the plaintiff and against Mrs Lincoln on 26th November, 1997, for the sum of £5,000 together with interest at Barclays Bank 1 year fixed deposit rate of interest from time to time for the period from 25th March, 1988 to 11th November, 1994, inclusive and further interest upon the total sum at the Court Rate from time to time from 12th November, 1994 until payment thereof. However enforcement of those orders was stayed pending determination of the value of the counterclaim.
In February, 1999, Mrs Lincoln purchased replacement carpets and underlay for which she paid the sum of £7,907.25 on 12th May, 1999. She gave 2 reasons for so doing which were as follows:-
(1)That she was no longer willing to put up with having sub-standard carpets which, she believed, emitted a foul smell.
(2)That she was starting to consider putting the Flat up for sale and wanted it to be in good order so that it could be presented to a prospective purchaser as a high quality Flat. Mrs Lincoln, who has for a number of years run a shop which sells clothes for ladies, was concerned that she would not be able to obtain the best possible price if she could not present the Flat together with its carpets in good order.
Advocate Young, in cross-examination, sought to challenge as to whether it was necessary for the carpets and the underlay to be replaced. However, the defendant did not produce any independent evidence in relation to this.
On 23rd April, 1999, the counterclaim was returned before the Royal Court which pronounced judgment as to liability against the defendant and referred the assessment of damages to the Greffier.
I made the following findings of fact:-
(1)That both the Flat and the carpets therein were of high quality.
(2)That the damage to the carpets and the underlay was such as to render it perfectly reasonable for the plaintiff to replace all of these with carpets and underlay of equivalent quality.
(3)That the plaintiff could have done this as early as March 1994, when the sub-lease of the estate of Mrs Shilston ended.
A further complication arose during the hearing inasmuch that I had to hear further evidence as to whether the plaintiff had entered into any contract with Mrs Lincoln to purchase the new carpets and underlay from her. On this point Mrs Lincoln gave evidence that she considered herself and the plaintiff to be effectively one entity as she was the sole beneficial owner of the plaintiff. The plaintiff did not have any separate bank accounts and annual accounts were not produced for it. She conceded that no formal meetings of the company had taken place in relation to the acquisition of the carpets. However, she did not believe that any formal meetings had taken place in relation to the leasing of the Flat by the plaintiff as she was the agent of the plaintiff. I came to the conclusion that in February, 1999, the new carpets had been purchased by Mrs Lincoln personally and that as at the date of the hearing before me, no formal arrangement had been agreed between Mrs Lincoln and the plaintiff.
I should mention in passing that there was no dispute between the parties that the original carpets were owned by the plaintiff, which held the head lease of the Flat and which Mrs Lincoln had purchased by purchasing its shares. Mrs Lincoln was not clear as to whether the company had owned the original carpets when she purchased it but that was not relevant.
The position of the plaintiff was that in March 1994 it should have been provided by the plaintiff with new carpets and underlay. Accordingly, it claimed the price of new carpets and underlay in 1994 which amounted to £6,065.25 together with interest thereon from 25th March, 1994 to the date of payment thereof at the Court Rate from time to time.
The first position of the defendant was that it was not necessary for the carpets and underlay to be replaced at all. The various tenants had continued to live with the carpets until 1996 and Mrs Lincoln herself had lived with them for 3 years until February, 1999. As I have said above, I rejected this argument. During the hearing, Advocate Young developed a second line of argument that there had been no loss suffered based upon the fact, which I have found, that the replacement carpets have been purchased by Mrs Lincoln personally and not by the plaintiff. I shall deal with that point later.
The fallback position of the defendant was that it would not be fair and just for the defendant to have to provide the plaintiff with something better than she ought to have had. Advocate Young submitted that in March 1994, the plaintiff ought to have had a 6 year old carpet which had been subject to reasonable wear and tear and not a new carpet. Accordingly, he submitted that the cost of the carpet ought to be based upon March 1994 prices which would be the said sum of £6,065.25 less an appropriate discount for use. He submitted that as the carpets had remained in use until 1999 and as they had an expected life of 20 years, the discount should be 11/20ths. Advocate Young also submitted that as no payment had been made in relation to replacement carpets until 1999, it would not be possible for interest to be ordered under the Interest on Debts and Damages Law for the period between 1994 and 1999. Accordingly, the defendant’s fallback position was that I should order the payment of 45% of the 1994 price of the carpets without the new underlay.
Article 2 of the Interest on Debts and Damages (Jersey) Law 1996 commences as follows:-
"(1)Subject to paragraph (4), in any proceedings, whenever instituted, for the recovery of any debt or damages, the Court may, if it thinks fit, order that there should be included in the sum for which judgment is given simple interest at such rate as it thinks fit on the whole or any part of the debt or damages in respect of which judgment is given, or payment is made before judgment, for the whole or any part of the period between the date on which the cause of action arose and -
(a)in the case of any sum paid before judgment, the date of the payment; and
(b)in the case of a sum for which judgment is given, the date of the judgment."
As the cause of action in relation to this matter arose on or before 25th March, 1994, I have no doubt that I have the power, if I deem it appropriate, to order interest for the period from March 25th, 1994, onwards.
I turn now to the principles of law in relation to the assessment of damages in such a case as this. The principle which must be applied both in relation to a tort case and in relation to a breach of contract case such as this is the principle of restitutio in integrum. That is to say, the plaintiff must be returned to the position in which they should have been but for the tort or breach of contract. From the authorities which were put before me, it is clear that slightly different principles are applied to different cases. However, what I am dealing with here is damage to a chattel. The plaintiff brought to my attention the case of Bacon -v- Cooper (Metals) Limited (1982) 1 All E R 397. That action concerned a scrap metal dealer who had purchased a fragmentiser. An essential part of this had broken and the plaintiff had been forced to purchase a replacement part. One of the arguments raised by the defendant had been that the part could have been used for a further three and three quarter years. The defendant argued that it would not be just for it to have to pay the whole of the cost of the new part as the plaintiff would thereby have a new part rather than an old part.
However, the Court decided that in the circumstances of that case, it was appropriate that the plaintiff be reimbursed for the whole of the cost of the new part. The following section commencing on page 400 of the judgment is helpful:-
"Counsel for the plaintiff contends that the plaintiff is entitled to the whole £41,500 which it was necessary to spend in order to put the fragmentiser back into working order. He relies on the decision in Harbutt’s Plasticine Ltd v Wayne Tank and Pump Co Ltd [1970] 1 All ER 225, [1970] 1 QB 447. Counsel for the defendants says that that was a case about the replacement of a building and the present case is about the replacement of a chattel which is a wasting asset. That may be so, although I think it is more correct to describe this case as a case about the repair of a chattel, namely a fragmentiser, the repair necessarily involving, as repairs often do, the incorporation of a new part. Counsel for the defendants says that, if counsel’s submission for the plaintiff is correct, the defendants would be liable for the cost of a new rotor even if the damaged one had had only a few days of remaining useful life. He says that that would be an absurd result. I think it would be. The application of any general principle is inappropriate at the point where it would produce an absurdity. Each case should depend on its own facts. What are the facts here? But for the defendants’ breach of contract, the plaintiff would not have had to lay out any money at all on buying a new rotor for nearly four years. At the expiration of that time he might reasonably be expected to have to buy a new one on hire purchase. It is not, of course, a complete certainty that he would buy a new one because all sorts of things might happen by the end of 1983. One can speculate on what might then have happened if there had been no accident. At the end of 3¾ years this early type of fragmentiser may be out of date and superseded by a machine or a process which is more efficient and profitable. The plaintiff, who will long ago have paid off his original hire-purchase agreement for the fragmentiser, might decide to change the machine, or the process, for producing scrap for steelmakers, particularly if he is faced with the heavy cost of a new rotor. Fragmentisers have only been in use in this country since 1975 and already there have been some modifications.
Mr Wallace, the defendants’ commercial director, thoroughly disapproves of this type of fragmentiser. He says it is self-destructive and not an economic proposition. He told me that already a new system is being developed which makes the scrap metal extremely brittle before it is put into a machine to be broken up. There are other possibilities, of course, because life is uncertain. At the expiration of 3¾ years the plaintiff might radically change the nature of his scrap metal business, or start a completely different business, or retire from business altogether, or he might die, but, whatever it is supposed might otherwise happen in 1983, the plaintiff, even though he may continue to use his present fragmentiser for seven years or more, is bound, if counsel for the defendants is correct, to incur the financial burden of spending £19,268 now, from his own strained resources and without recourse to the defendants who caused this very considerable burden to fall on him.
In his argument counsel for the defendants assumed that at the end of 3¾ years the plaintiff would have entered into a new hire-purchase agreement to purchase a new rotor, and I think that is a reasonable assumption on the basis that the plaintiff would continue to operate this fragmentiser after that period, for he has not much ready money to spare. Entering into the new and burdensome hire-purchase agreement at the end of 1983 is very different from having to pay out £19,268 years before he would have to pay anything at all. It is not the plaintiff’s fault that he had to buy a new rotor for his machine; it is entirely the fault of the defendants. When they suddenly put him in that situation there was nothing else he could do. He could not have gone out and bought a rotor with only 3¾ years of life; it had to be a new one.
In Harbutt’s Plasticine Ltd v Wayne Tank and Pump Co Ltd [1970] 1 All ER 225 at 240, [1970] 1 QB 447 at 472-473 Widgery LJ said:
‘In my opinion each case depends on its own facts, it being remembered, first, that the purpose of the award of damages is to restore the plaintiff to his position before the loss occurred and secondly, that the plaintiff must act reasonably to mitigate his loss. If the article damaged is a motor car of popular make, the plaintiff cannot charge the defendant with the cost of the repair when it is cheaper to buy a similar car on the market. On the other hand, if no substitute for the damaged article is available and no reasonable alternative can be provided, the plaintiff should be entitled to the cost of the repair. It was clear in the present case that it was reasonable for the plaintiffs to rebuild their factory, because there was no other way in which they could carry on their business and retain their labour force. The plaintiffs rebuilt their factory to a substantially different design, and if this had involved expenditure beyond the cost of replacing the old, the difference might not have been recoverable, but there is no suggestion of this here. Nor do I accept that the plaintiffs must give credit under the heading of "betterment" for the fact that their new factory is modern in design and materials. To do so would be the equivalent of forcing the plaintiffs to invest their money in the modernising of their plant which might be highly inconvenient for them.’
That was a case about a building, but as long ago as 1844 much the same principle was applied in the High Court of Admiralty in a case about repairs to a ship involving the replacement of old articles by new. In The Gazelle 2 Wm Rob 279 at 281, 166 ER 759 at 760 Dr Lushington said:
‘The right against the wrongdoers is for a restitutio in integrum, and this restitution he is bound to make without calling upon the party injured to assist him in any way whatsoever. If the settlement of the indemnification be attended with any difficulty (and in those cases difficulties must and will frequently occur), the party in fault must bear the inconvenience. He has no right to fix this incovenience upon the injured party; and if that party derives incidentally a greater benefit than mere indemnification, it arises only from the impossibility of otherwise effecting such indemnification without exposing him to some loss or burden, which the law will not place upon him.’
In my view the law will not place this burden on the plaintiff to relieve the defendants from some of the unavoidable consequences of their wrong. I consider the plaintiff is entitled to recover the whole cost of the replacement rotor. The result is that the claim for £47,259, for making the fragmentiser fit for use, succeeds."
Advocate Fielding also brought to my attention the following section beginning on page 13 of the 16th Edition of McGregor on Damages and which reads as follows:-
"The second variety stems from the frequent impossibility of repairing damaged property without putting it into a better condition than it was before the damage had been inflicted, since repairing with old and worn materials is not a practical possibility. In these circumstances the question arises whether there should be a deduction from the cost of repair of the amount by which the property, after repair, is more valuable than beforehand. The first cases tended to hold that there should indeed be such a deduction, this solution appearing both in cases where land was tortiously damaged and in cases where lessees were in breach of covenants to repair. But, at a comparatively early date, the cases concerning damage to ships rejected the argument that there must be a deduction on account of "new for old" since, as was well expressed by Dr Lushington, if the plaintiff:
"derives incidentally a greater benefit than mere indemnification, it arises only from the impossibility of otherwise effecting such indemnification without exposing him to some loss or burden, which the law will not place on him".
This approach has been adopted in modern times in relation to damage to land, whether caused tortiously or through breach of contract, and has been applied to chattels other than ships. Thus where a contractual breach resulted in the destruction of a factory, the Court of Appeal refused to allow any deduction from the damages, which were based on the costs of rebuilding, on account of what was described as "betterment", for, as Widgery L.J. pointed out, "to do so would be the equivalent of forcing the plaintiffs to invest their money in the modernising of their plant which might be highly inconvenient for them". Lord Denning M.R. pointed out that, when their factory was destroyed, the plaintiffs had no choice but to replace it as soon as they could, not only to keep their business going but also to mitigate their loss of profit. On the other hand, where the necessity of the case does not demand reinstatement, plaintiffs may find themselves limited to claiming for the diminution of the value of the property in question. This is so, for instance, where a house has been purchased in reliance on a negligent surveyor’s report, the cost of putting the property into the condition described in the report not being required to put the purchaser into the position he would have been in had the surveying contract been properly fulfilled."
Both parties also drew my attention to the case of Dominion Mosaics and Tile Co Ltd and another -v- Trafalgar Trucking Co Ltd and another (1990) 2 All E R 246.
The first section which I want to quote from that judgment commences on page 249 and reads as follows:-
"‘In my judgment, whilst every case depends on its own facts, what it all comes down to is this question: what is reasonable and what is fair between the parties? In some cases the plaintiff may arguably receive a bonus, as for example in the Harbutt’s Plasticine Ltd case, but that in itself, so long as the general principle or reasonableness and fairness is not infringed, is not a reason for reducing the plaintiff’s damages. As was said in one case, ‘The general rule is that the injured person is to be fairly compensated for the damage he has sustained, neither more nor less" (see Philips v Ward [1956] 1 All ER 874 at 876, [1956]1 WLR 471 at 473 per Denning LJ]. It seems to me on the whole of the evidence eminently reasonable that the plaintiffs should have done what they did in relation to the acquiring of new premises and that, indeed, by not rebuilding, they have saved the defendants money. Furthermore, it seems to me eminently reasonable and fair that the defendants should recompense the plaintiffs for the cost of acquiring new premises, in principle. It would not be reasonable and would not be fair to award damages, in my judgment, on the basis of the diminution in value which it is alleged was suffered by the burning down of the building. Accordingly, I am abundantly satisfied that the basic figure of £390,000 is correct as a starting point.’".
There is a further helpful section commencing on page 250 which reads as follows:-
"‘The destruction of a building is different from the destruction of a chattel. If a secondhand car is destroyed, the owner gets its value; because he can go into the market and get another secondhand car to replace it. He cannot charge the other party with the cost of replacing it with a new car."
There is a further helpful passage on page 251 which reads as follows:-
"‘The various decided case on each side of the line to which my attention has been drawn, and to some of which I have referred in this judgment, reflect in my opinion merely the application in them of two basic principles of law to the facts of those various cases. These two basic principles are, first, that whenever damages are to be awarded against a tortfeasor or against a man who has broken a contract, then those damages shall be such as will, so far as money can, put the plaintiff in the same position as he would have been had the tort or breach of contract not occurred. But secondly, the damages to be awarded are to be reasonable, reasonable that is as between the plaintiff on the one hand and the defendant on the other.’"
There is a further helpful passage commencing with the last paragraph on page 252 which reads as follows:-
"‘The general principle, referred to in many authorities, has recently been recognised by Lord Wilberforce in Miliangos v George Fralnk (Textiles) Ltd [1975] 3 All ER 801 at 813, [1976] AC 443 at 468, namely that "as a general rule in English law damages for tort or for breach of contract are assessed as at the date of the breach". But in the very passage in which this "general rule" is there stated, it is stressed that it is not a universal rule. That it is subject to many exceptions and qualifications is clear...The true rule is that, where there is a material difference between the cost of the repair at the date of the wrongful act and the cost of repair when the repairs can, having regard to all the relevant circumstances, first reasonably be undertaken, it is the latter time by reference to which the cost of repairs is to be taken in assessing the damages.’".
There is a further helpful passage commencing with the third paragraph on page 254 which reads as follows:-
"‘I quite readily accept that the replacement value is a starting point and is very often the whole test. However, it is quite clear that is not always so. For example, it is not so if the result of giving the full value would be absurd. An example of this was given in Bacon v Cooper (Metals) Ltd [1982] 1 All ER 397. If these paternoster machines had been virtually worn out, with, and I take an extreme example, a month’s life left in them, it would, in my judgment, offend reason and fairness if the plaintiffs could be awarded the full value of the machines.’".
There is a further helpful passage commencing with the last paragraph on page 254 which reads as follows:-
"Second, counsel for the respondents submits the judge was wrong to take account of the fact that the respondents had not replaced the machines even by the date of trial. Their evidence that they would have done had they been in funds was expressly accepted by the judge. In any event, there is no obligation in principle on a plaintiff to deploy damages awarded for loss of a chattel in replacing it. He is free to do whatever he wishes with his damages".
On page 255 of the judgment Taylor LJ discussed the different positions of the different parties and in one of the paragraphs of his judgment he stated as follows:-
"Had it been argued that in fairness to the appellants some discount from £65,000 should have been allowed to reflect the depreciation of the machines in their few months of service, the point would have merited consideration."
I deduce from these judgments the following principles:-
Firstly, in a case such as this the principle of restitutio in integrum should apply.
Secondly, every case depends on its own facts and it comes down to the question as to what is reasonable and what is fair between the parties.
In some cases the plaintiff may receive a bonus but that in itself, so long as the general principle of reasonableness and fairness is not infringed, is not a reason for reducing the plaintiff’s damages.
Applying these principles, the first question which I have to determine is as to whether it is reasonable that the defendant be ordered to pay the cost of replacement carpets and underlay or only some proportion thereof in order to reflect the fact that in March 1994, the plaintiff should have been left by the defendant 6 year old carpets and not new carpets. I take into account the fact that this is a case in which there does not exist a ready market for secondhand carpets. The plaintiff could not reasonably go out and buy 6 year old carpets in 1994 in the way that a plaintiff might be able to buy a 6 year old car. There is, however, a ready supply of new carpets of similar quality.
If the matter had come before me in March 1994, then I would have had no hesitation in awarding to the plaintiff damages based upon 70% of the cost of new carpets and underlay. I would have done this upon the basis that 6 year old carpets would still have had about 14 years of use. Such a settlement would possibly be slightly generous to the plaintiff inasmuch that the depreciation of the value of carpets is presumably higher in the earliest years of usage. I would not then have been convinced that this fell into the category of the Bacon v Cooper Case or into the category of the Dominion Mosaics Case because a normal prudent owner of dwelling accommodation expects to have to replace his carpets from time to time and, in this case, about every 20 years. I do not think that there would have been any injustice in the plaintiff being required to put in 30% of the price of the new carpets and underlay at that time if they had been bought then because that is not a significant sum to the owner of a high quality flat and because new carpets are clearly more valuable than 6 year old carpets. Thus, in my view, an element of betterment must be allowed for in order to do justice to both parties.
However, this case was actually complicated by the fact that the carpets were not replaced until 1999 and then at the expense of Mrs Lincoln personally and by the fact that 11 years of usage of the carpets were obtained and not 6 years. I also have to consider what, if any, is the effect of the fact that the Flat may soon be put up for sale. The plaintiff produced in evidence a letter from an estate agent, namely a Mr Mike Sloman of Sloman & Son (Estate Agents) Limited. In the second paragraph of that letter Mr Sloman stated:-
"With regard to your question relating to the replacement of fitted carpets, I have to state that it is my opinion that new fitted carpets are not going to have any material effect on the price achieved in the eventual sale."
I am bound to say that the quality of that letter, as evidence, was extremely poor. Mr Sloman should have been called as a witness so that he could be cross-examined as to his opinion on the matter. I could have taken the view that the letter had no evidential value at all. In fact I took it as nothing more than an opinion that a prospective purchaser would probably not offer more for a flat with new carpets than he would for a flat with old carpets which were in good condition.
In any event, Mrs Lincoln, in her evidence, clearly disagreed with that statement insofar as it related to the general presentation of the premises as luxury premises for the purposes of sale. The plaintiff sought to argue that, in the light of Mr Sloman’s opinion, it would receive virtually no benefit from the new carpets. To date it has not because it has not paid for the carpets and underlay. From Mrs Lincoln’s evidence it is clear that a benefit will be received by her of being able to present a flat with brand new carpets rather than a flat with 11 year old carpets. In any event, I cannot tell whether or not the Flat will shortly be sold and what value the purchaser might put on the new carpets or Mrs Lincoln might gain from a marketing point of view in relation to the eventual sale price by virtue of presenting the Flat with new carpets. All of these things are in the realms of pure speculation.
I do not think that the question as to who purchased the new carpets has any relevance. Part of the extract which commences with the last paragraph on page 254 of the Dominion Mosaics Company Limited Case indicated that there is no obligation in principle on a plaintiff to deploy damages awarded for loss of a chattel in replacing it. If the fact that the new carpet was purchased by Mrs Lincoln and not by the plaintiff has any relevance then this could simply be rectified by the plaintiff paying Mrs Lincoln for that carpet. However, in any event, what was lost was clearly the 6 year old carpet and underlay in 1994. Accordingly, I have come to the conclusion that I should ignore the events which have occurred after 1994. Although the tenants of the plaintiff continued to have the use of the carpet for a further 2 years and no financial loss was incurred during that period and although Mrs Lincoln, very unwillingly, continued to use the carpet for a further 3 years, I do not think that either of these things changes the basic position that in 1994 she should have been left a 6 year old carpet and underlay in good condition.
Accordingly, my assessment of damages is 14 years divided by 20 years x £6,065.25 = £4,245.68. To that will be added interest at the Court Rate from time to time pursuant to Practice Direction 93/1 from 25th March, 1994 until the payment thereof.
I believe that interest should run upon that basis as interest has been allowed upon the amount of the deposit upon that basis for most of the relevant period.
What remains to be determined is the issue of the costs of and incidental both to the original action and to the counterclaim. I will expect both counsel to address me on this at the hearing when this judgment is formally delivered and will let them have copies of a draft judgment prior to the hearing so that they can prepare appropriately for the hearing. Finally, I noted that at the previous hearing, Advocate Fielding, on behalf of the plaintiff, indicated that the plaintiff wished to amend its counterclaim in order to include a claim for damages for failures of decoration. I then indicated that I could not consider this as part of the present hearing because all that I was ordered to do by the Royal Court was to assess the damages in relation to the existing counterclaim following upon the judgment for liability which had been entered against the defendant on 23rd April, 1999.
Any application in relation to an amendment of the counterclaim ought to be made at the hearing when I deliver this judgment. If an amendment is allowed then I will need to go on to consider whether or not the judgment on the original action should remain stayed in whole or in part pending determination of that further claim and I would expect both counsel to address me on that point.
Authorities
Interest on Debts and Damages (Jersey) Law 1996, Article 2.
Bacon -v- Cooper (metals) Limited (1982) 1 All ER 397.
McGregor on Damages, 16th Edn., p.13.
Dominion Mosaics and Tile Co., Ltd. & another -v- Trafalgar Trucking Co., Ltd. & another (1990) 2 All ER 246.