Bellgrove v Eldridge Facts: Eldridge retained Bellgrove to build a brick house villa for $3500.

However, Eldridge only paid $3100. Bellgrove sued for the balance, Eldridge countersued for damages b/c substantial departure from the contract which caused grave instability in the villa. Trial judge rejected Bellgroves claim. Trial judge accepted Eldridges claim and awarded damages of $4950. Bellgrove appealed on the question of damages as trial judge decided that the work was so defective that rendered demolition and reconstruction of the villa. Issue: Whether trial judge erred in assessing damages on basis of demolition and reconstruction of the building? In particular should the trial judge have assessed damages by comparing the value of the villa if it had been properly built against the value as it currently stood? Held: Appeal dismissed Trial judge correctly assessed damages on basis of costs associated with demolition and reconstruction b/c demolition and reconstruction required to remedy defects as defects likely to cause grave instability Court noted that Eldridge might not demolish and rebuild end up living in defective villa and still receive payment for damages. Court said it was immaterial Eldridge is still entitled to compensation for the breach of contract Principle of Assessing Damages for Defective Works Method The method of assessing damages is whether it was 1) necessary to produce conformity (entitled to what they bargained/signed for); and 2) reasonable course to adopt Measure of damage 1) cost of rectification 2) loss in value of property Which measure to use? 1) If it is both necessary and reasonable to undertake rectification then the proper measure of damages is cost of rectification 2) If it was necessary to rectify to conform to the contract but not reasonable, the value of such loss is the diminution in value produced by the defects (ie value of the building had it been built as required by the contract less its value as it stands). 3) In assessing whether rectification is both necessary and reasonable is a question of fact